A senior financial consultant has said he is "not surprised" that Tesco plans to close its DB pension scheme.

Speaking on Radio 5 Live's Wake up to Money programme, Barnett Waddingham senior consultant Malcolm McLean said the current scheme was bound to be under threat as Tesco continues to navigate difficult times.

"There is no doubt about it that the current scheme is one of the best, if not the best, on the market – offering as it does a guaranteed risk-free way for Tesco employees to accumulate valuable pension provision for later lives," he said.

"Tesco is now clearly going through a difficult patch in terms of its business affairs and is looking to improve its profitability and reduce costs on a number of fronts – it's hardly surprising against this background and in the face of rapidly growing deficits that this very lucrative scheme may have to close down."

Mr McLean's comments follow the revelation that Tesco has written to its 300,000 staff outlining plans for the future of the supermarket's pension scheme as it looks for ways to plug the estimated £5bn black hole.

In the letter to staff, Ruston Smith, Tesco pensions director, wrote: "In January we announced our plans to consult on closing our existing pension scheme and replacing it with a new one – these proposed changes would allow us to continue to protect any pension you have already built up and allows us to continue offer a competitive pension for colleagues in the future."

Tesco has recently announced its worst-ever annual results and unions are preparing for the worst as Dave Lewis, the chief executive, has already put in place radical changes to the running of the company, stripping out layers of management in head office and on shop floors.

However, the shop-workers union, Usdaw, has told Tesco staff they will try to overturn the retailer's plans to scrap the defined benefit pension scheme and encourage bosses at the supermarket to look for other ways to save costs.

Usdaw's national officer, Pauline Foulkes, said: "We will be seeking further details, including the business case and rationale for the proposed changes, what can be done to maintain a defined benefit pension scheme and for the defined contribution scheme Tesco is proposing to replace it with."

First published 23.04.2015

Lindsay.sharman@wilmington.com