BT Group PLC, London, is set to consult with employees on proposed changes to its retirement arrangements, said the firm in its latest quarterly update.
The telecommunications firm, which sponsors the £48.7 billion ($63.9 billion) BT Pension Scheme, said in the update that a "review of future pension benefits continues and we expect to consult with affected employees on proposed changes shortly."
The BTPS had a £7.7 billion deficit as of Sept. 30, down 3.75% from the deficit as of June 30. Assets as of June 30 totaled £49 billion. The deficit increased 1.3% vs. figures at March 31, when assets totaled £50 billion, said the update.
The update attributed a 1% fall in liabilities over the three-month period ended Sept. 30, to £57.5 billion, to an increase in the discount rate. The discount rate was 2.5% as of Sept. 30, vs. 2.45% as of June 30. The deficit reduction was "partly offset by a fall in the assets," said the update.
BT is undergoing a triennial valuation of the fund, "and constructive discussions continue" with the trustee, the update said. "We are considering a number of funding options to address the deficit, including arrangements that would give the BTPS a prior claim over certain BT assets. We still expect to complete the triennial valuation in the first half of the 2018 calendar year."
Discussions continue with the firm's unions, said the update.
A spokesman for BT referred questions to the update and declined to comment further.