BT Group and the BT Pension Scheme (BTPS) have agreed the 2023 triennial funding valuation, revealing that the scheme’s funding deficit has fallen from £7.98bn at the 2020 valuation to £3.7bn as at 30 June 2023.

The parties also agreed on a new deficit recovery plan as part of the valuation, meaning that annual contribution amounts will remain unchanged, at £600m in each financial year until 31 March 2030, with a final payment of £490m due before 30 April 2030.

In addition to this, the sponsoring employer, BT Group, will continue to make payments of £180m each year under the asset-backed funding arrangement agreed at the 2020 valuation.

At the same time, the BTPS will look to continue to de-risk its investment strategy through to 2034, in an effort to provide more certainty over outcomes.

BT Group also agreed to continue to provide the scheme with legal protections to 2035 as part of a long-term funding framework.

While the scheme is already on track to be fully funded by 2030, the group suggested that the amendments to the scheme's existing stabiliser mechanism will provide greater certainty that the BTPS will achieve full funding and increase the likelihood of a future refund to BT Group.

BTPS chairman, Otto Thoresen, 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."

BT Group chief financial officer, Simon Lowth, added: "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."

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