Ofcom has confirmed its decision to not change the way it treats BT's wholesale costs in terms of the pension deficit it is running. Ofcom had previously consulted twice over this matter and BT has said it will seriously consider legal action if the regulator did not change its tact.
BT believe that it should be able to take in to account pension costs when setting wholesale costs for its Openreach services which are regulated by Ofcom. This is generally the practice used in other industries as Ofgem allows energy companies to increase wholesale charges to help with pension deficits. Indeed, Ofcom increased its own fees to BT partly to help cover costs of a deficit in their pension.
"We believe that we have provided strong evidence that pension deficit payments should be reflected in our costs while there is also precedent from other regulated industries to support our view.
We will be reviewing Ofcom's document in detail before deciding on an appropriate course of action."BT Statement
BT were running a £5.2bn deficit on the pension scheme at the end of September. The full Ofcom statement can be read here.