TAXPAYERS will have to stump up a staggering £23bn to BT’s pension trustees if the telecoms giant ever goes bust.
A landmark ruling yesterday means even BT workers who joined after the firm was privatised in 1984 will have their pension liabilities covered.
The ruling will increase the government’s contingent liability but will not affect the national debt figure. The government is likely to appeal the decision. It had argued its liability only covers benefits that had accrued up until the date of privatisation, which would have capped the guarantee at £7.3bn.
BT insists the scheme will have little financial impact, instead benefitting its trustees. A spokesman said: “The judgment has no impact on our agreed payments to the scheme.”
However, the firm’s shares jumped more than six per cent on news of the ruling amid hopes insurance on the liabilities could decrease thanks to the guarantee. They closed at 156.3p.
The ruling is unlikely to cause other formerly privatised firms to seek protection for their trustees as it relied on a special deal struck between the government and BT during the privatisation process. BT’s pension deficit stood at £9.1bn when it was calculated in December 2008.