British Telecom to cut 10,000 more jobs; slash dividend: report

13 April 2009

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.