LONDON (Alliance News) - The UK government will have to guarantee the payment of BT Group PLC's pension scheme should the company become insolvent, following a court of appeal ruling Wednesday, the Financial Times reported.
The court of appeal decision confirmed an earlier High Court judgement. The government had challenged the need to cover pensions agreed after privatisation in 1984.
However, the court dismissed the appeal and confirmed that the Crown guarantee extends to liabilities relating to members that joined after privatisation.
The ruling does, however, mean that the state will no longer need to pay for the scheme as a whole should BT go into administration. Instead it will have an obligation to pay deficit contributions akin to BT's.
http://www.ft.com/cms/s/0/350cd4e0-0cdf-11e4-bf1e-00144feabdc0.html?ftcamp=crm/email/2014717/nbe/UKBusiness/product#axzz37XZV3ONO
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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