BT Hybrid Pension moves closer…


Following months of complex negotiations with the CWU, BT is today (Thursday) launching a major communications exercise detailing an innovative and completely new BT pension option for former contributors to the BT Pension Scheme.

Fulfilling one of the key elements of the 2018 Pensions Agreement, the so- called BT Hybrid Scheme (BTHS) will be available to around 19,000 team members in BT, Openreach and BT Fleet who were active members of the BTPS when it closed for future service accrual earlier this year.

So long as members are still working for one of the three participating companies come April 1 next year, those individuals will have the option of switching to the new ‘Hybrid’ scheme. The new scheme will combine both defined benefit elements (like the BTPS) and defined contribution (money purchase) pension benefits like the BT Retirement Savings Scheme (BTRSS). By combining both types of pension benefit, the BTHS is designed to reduce investment risk and also provide more certainty over pension benefits compared with other options. Defined benefit (DB) pension benefits are guaranteed – whereas defined contribution (DC) pension outcomes depend on a number of factors, including investment returns.

Members of the BTHS will get guaranteed DB pension benefits on the first £17,500 of salary and DC benefits on the residue. The £17,500 threshold is pro-rated for part-timers and will generally increase in future by inflation.

CWU assistant secretary Nigel Cotgrove commented: “This is a key step in the implementation of our Pension Agreement. It’s now important that anyone eligible to join the BTHS weighs up the alternatives before making an informed decision as to what is best for them.”

“In the coming days, thousands of deferred members of the BTPS will receive a ‘Time to Choose’ booklet as well details of an online modeller that will allow them to compare the relative benefits of the BTHS and BTRSS in various different scenarios. It’s important to stress that the modeller cannot provide a guaranteed statement of pension benefits – so is not a substitute for independent financial advice – but it is a helpful tool that will hopefully assist members make an informed decision.”

A series of seminar, webinars and conference calls will also be made accessible to potential BTHS members over the coming months.

Nigel concludes: “While former BTPS contributors obviously have an important decision to make, the fact that the BTHS formally launches on April 1 next year means there is time for individuals to weigh up the options in detail.

“For those who  decide the BTHS is right for them, there’s the option to pre-register for membership of that scheme from the start of March – guaranteeing Hybrid scheme benefits from day one of the new scheme – but eligible members will still be able to opt in until the end of September next year.”

The CWU is legally prevented from giving financial advice but all CWU members are entitled to a no obligation initial financial consultation with Lighthouse Financial Advice. Further information on this option is available on the CWU web site at

For more information see Letter to Branches No. 669/2018 here