14 November 2023
BT Group announces triennial pension valuation
BT Group and the BT Pension Scheme (“BTPS”) have agreed the 30 June 2023 triennial funding valuation (“2023 valuation”) and how the deficit will be addressed (the “recovery plan”):
1. The funding deficit at 30 June 2023 is £3.70bn, down from £7.98bn at the 2020 funding valuation following £4.36bn of deficit contributions
2. Annual contribution amounts remain unchanged, at £600m in each financial year until 31 March 2030, and a final payment of £490m before 30 April 2030. In addition, BT Group will continue to make payments of £180m each year under the asset-backed funding arrangement agreed at the 2020 valuation
The BTPS will continue to de-risk its investment strategy through to 2034, providing more certainty over outcomes, and is on track to be fully funded by 2030.
BT Group has agreed to continue to provide the BTPS with legal protections to 2035 as part of a long-term funding framework. The changes made to contractual protections for the BTPS at this valuation are consistent with our statutory obligations under the Pension Schemes Act 2021. The amendments agreed to the BTPS’s existing stabiliser mechanism provide greater certainty that BTPS will achieve full funding and increase the likelihood of a future refund to BT Group.
Simon Lowth, BT Group Chief Financial Officer, said: “I am pleased that the BTPS continues to deliver in line with the long-term plan, despite the uncertainty and headwinds observed since 2020. Building on the framework agreed at the 2020 valuation allowed for a swift conclusion of the 2023 valuation.
“The agreement allows us to deliver on our strategic initiatives such as investing in our networks and transforming our business. And it is consistent with our funding priorities of investing in value enhancing opportunities, supporting our pension funds, paying progressive dividends and maintaining a strong balance sheet.“
Otto Thoresen, BTPS Chairman, said: “The BTPS continues to be on track to fulfil its commitments to members, despite high levels of macroeconomic volatility and uncertainty.
“Our deficit is reducing, funding levels have improved and we remain on course to be fully funded by 2030.”