Wednesday, 1 November 2017

Thousands of BT employees face pension cuts as defined benefit scheme nears axe

Thousands of BT employees will be told later this month of proposed cuts to their pension benefits as the telecoms giant wrestles with a near-£14bn deficit in its retirement schemes.

Sky News understands that BT Group will say on Thursday alongside its half-year results announcement to the City that it is close to setting out a concrete plan to slash the soaring cost of its pension obligations.
Sources said the company was leaning towards closing the BT Pension Scheme to future accruals and moving the remaining years of members' pensions to its defined contribution scheme.

The move comes as BT prepares to outline a new formula for paying its prized dividend following recent speculation that it could be cut after a difficult few months for the company.

The telecoms, broadband and pay-television provider - which competes with Sky plc, the owner of Sky News - will avoid such a reduction, according to sources, but will switch to a model that will re-weight the dividend towards the second half of its financial year, according to analysts.

Sources said that BT's Global Services unit, which has been the source of many of the company's challenges this year, including a huge write down because of a fraud in its Italian business, had continued to struggle.

SKY          News.