CAR manufacturer Nissan is to inject £50m into its workers' pension fund to make up for a shortfall.

The company announced in June it was closing its final salary scheme to newcomers and was searching for a way to plug a £121m deficit.

Options included a cash injection by Nissan, an increase in company and employee contributions, and a reduction in the scheme's accrual rate.

After discussions and a request from the company council for more money to be provided by the Japanese employer, Nissan has agreed to increase the size of its cash injection by £20m over five years, up from the £30m originally proposed.

The extra money will enable the proposed increases in employee contributions to be lowered and will also allow accrual rates to be improved for all the final salary scheme's 5,000-plus members.

The proposed increase in Nissan's contributions, from 12 per cent to 16 per cent of salary over three years, will remain unchanged.

Philip Ashmore, personnel director, said: "During the consultations, the company council has been fair but very determined in asking Nissan to bear more of the cost of the pension fund.

"This is a time that has proved difficult for all UK pension funds, given the current investment environment.

"However, the cash injection of £50m underlines Nissan's commitment to safeguarding its final salary scheme for all of its existing members."

Last year, Nissan produced 297,000 vehicles in its Sunderland factory, the largest car manufacturing plant in the UK.