The Great Debate UK

Why BT’s pension line is out of order


REUTERS– Neil Collins is a Reuters columnist. The views expressed are his own –

It is a quarter of a century since the ground-breaking privatisation of BT. Unfortunately, it may not be many more years before a reluctant government is forced to take the company back into state ownership.

The new BT annual report, 169 pages of it, gives only a few hints of the scale of the problem facing what John Ralfe recently described as “a badly run hedge fund that happens to own a phone network”.

Ralfe is an independent consultant and something of a maverick in the arcane world of pension deficits, but he has a point. The directors claim that BT will make enough to grow the (reduced) dividend, invest in the business and support the pension scheme, all at once. It’s far from clear how.

BT must be more efficient


david-kuo_motley-foolthumbnail- David Kuo is director at The Motley Fool. The opinions expressed are his own.-

BT’s annual results were expected to be bad. It turns out that they weren’t just bad – they were awful.

Now, many of us were expecting massive losses, a slashing of dividends, the axing of jobs and a gaping hole in the company’s pension fund. And BT duly delivered on all fronts.