British telecom giant BT is planning to shed another 10,000 jobs over and above the 10,000 jobs – mostly contract and temporary workers – it had already cut, newspaper reports said.

Stung by losses at is Global Services division, BT is expected to write down about £1.5 billion and scale back its dividend when it announces its preliminary results next month.

The group would announce the redundancies along with planned cost cutting measures in its annual report next month, the Sunday Times reported citing unnamed sources within the firm.

BT has continuously been reporting losses ever since it was privatised by prime minister Margaret Thatcher in 1984 after it accumulated a pension deficit of around 8 billion pounds ($11.7 billion).

The company, which has a total workforce of around 160,000 in 170 countries, is expected to cut its dividend by up to 60 per cent after provisioning for the pension deficit.

For the third quarter ended 31 December 2008, Global Services, which provides IT and telecoms services to multi-national companies and government bodies, suffered high costs, slow delivery of cost savings and contract review charges that resulted in an operating loss of £501 million at the division, compared with profits of £22 million the previous year.

BT Global Services, which has 17 major contracts, is expected to reveal further writedowns next month. The unit, said last month that overspending on three contracts led to charges of £336 million. It added that two contracts are expected to run to "hundreds of millions of pounds" worth of losses each in the fourth quarter.

These two contracts are reported to be with the NHS and Reuters.

Two of BT's three £12 billion IT upgrade contracts with the National Health Service (NHS) are thought to have gone well. But speculation centres on a third contract to install IT systems at hospitals in London, which is expected to account for most of the write-offs. It is understood that BT's board believe they now have an opportunity to clear up its balance sheet.

Global Services, which employs about 37,000 people, was once viewed as the "jewel in the crown" at BT, but since October it has triggered two profits warnings.

For its third-quarter, BT's group pre-tax profits plunged 81 per cent to £113 million, as soaring costs and writedowns at Global Services took its toll.

BT's other three divisions - retail, whole and Openreach that manages the first mile from telecoms exchanges to customers' premises, however, put up a robust third-quarter performance.