BT Group (LON:BT.A) has moved a step closer in its efforts to overhaul its pension system, as members of the Prospect trade union voted in favour of the telco’s proposals. The move comes as the FTSE 100 group looks to tackle its massive pension deficit.
BT’s share price has advanced in today’s session, having added 1.79 percent to 272.76p as of 13:58 GMT, outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.45 percent higher at 7,731.51 points. The group’s shares lost just under 30 percent of their value over the past year, as compared with a near seven-percent rise in the Footsie.
Union votes in favour of BT proposals
Trade union Prospect announced in a statement yesterday that managers and professionals working at BT had voted to accept the telco’s new pension deal. The union’s members balloted on a pay and pensions offer negotiated by the union at the end of last year, including an increase in pay by one-two percent on performance rating and position in pay range, extra transitional payments for members being moved out of BT’s defined benefit pension scheme to its defined contribution scheme, as well as an increase in employer contributions for existing members of the contribution scheme.
The former telecoms monopoly announced plans to review its defined benefit pension scheme last year. The scheme closed to new members in 2001, with new employees joining a defined contribution scheme.
Analysts on BT Group
Macquarie remains bullish on the former telecoms monopoly, having reiterated its ‘outperform’ rating on the group last week, without specifying a price target on the shares. According to MarketBeat, the blue-chip telco currently has a consensus ‘hold’ rating and an average price target of 339.06p.