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		</div><p><a href="http://londonglossy.com/wp-content/uploads/2010/11/balfour-agrees-pension-deficit-deal.jpg"><img class="alignnone size-full" title="Balfour Beatty has agreed a deal to plug a £375 million hole in its pension fund" src="http://londonglossy.com/wp-content/uploads/2010/11/min-balfour-agrees-pension-deficit-deal.jpg" alt="Balfour Beatty has agreed a deal to plug a £375 million hole in its pension fund"/></a></p>
<p>Building giant Balfour Beatty has agreed a deal to plug a £375 million hole in its pension fund.</p>
<p>The group has reached an eight-year funding agreement with trustees of the pension scheme to pay a one-off £40 million sum and also to double its annual deficit contributions to £48 million.</p>
<p>Balfour has more than 40,000 members in its defined benefit pension scheme, which closed to new members in 2007.</p>
<p>The group had agreed in 2008 to make payments into the scheme of £24 million a year, but the funding gap has soared in recent years &#8211; from around £114 million at the time of the last triennial review in 2007.</p>
<p>Balfour said it had already increased the annual contributions to £36 million since April in anticipation of a greater funding need after the latest scheme valuation. Its new agreement will also see contributions rise by inflation-linked increases every April.</p>
<p>Shares in Balfour rose nearly 2% as news of the deal ended uncertainty over its pension funding.</p>
<p>Mark Howson, analyst at Royal Bank of Scotland, said the contributions were unlikely to impact profit forecasts for Balfour, given that it had already increased annual payments to £36 million.</p>
<p>He added: &#8220;We remain buyers of Balfour Beatty, with our belief that the share price rating very much overplays the effects of the Comprehensive Spending Review on the business.&#8221;</p>
<p>The pension news comes after Balfour recently announced its subsidiary Mansell Construction services was buying Rok&#8217;s social housing arm in the South West and North West out of administration.</p>
<p>Around 380 Rok employees will be transferred as part of the deal.</p>
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