BT to consult 65,000 staff over future changes to pension schemes to tackle £9billion black hole — including raising the retirement age
The telecoms giant pension scheme was over £9billion in deficit at their last valuation three years ago
BT is to start consulting up to 64,500 staff about possible changes to its two pension schemes.
Chief exec Gavin Patterson said talks would take place within weeks.
Options under consideration include raising the retirement age in exchange for future benefits and closing the costly final salary scheme to the accrual of future benefits.
This scheme, with more than 32,000 active members, was £9billion in deficit at the last valuation three years ago, with the next due early next year.
The telecoms giant is also seeking to change the inflation measure it uses to calculate pension payments — helping save up to £2billion.
The proposal is subject to a court hearing in December.
The firm’s newer defined contribution scheme, where performance is linked to the stock market rather than to salaries, is also under examination. It also has more than 32,000 members.
Mr Patterson said he would be seeking an outcome that balanced “affordability and fairness”.
He said he wanted to ensure that “not one group was treated unfairly”.
But the radical plans could set him on a collision course with unions.
BT revealed a four per cent drop in earnings to £1.8billion in the three months to the end of September due to heavy investment in sports rights and ongoing woes in its global services arm.
Global services, which has been dogged by an accounting scandal in Italy, saw earnings tumble by 39 per cent to £81million in the second quarter.
Despite this, Mr Patterson said that it had been a “solid quarter” in line with expectations.
