The news comes after the revelation that BT's pension fund deficit has more than halved, from £9bn to £4.1bn between December 2008 and June 2011. The consequence is that the deficit will effectively fall to just over £2bn.

With 330,000 active, deferred and pensioner members, the BT scheme is the biggest private sector scheme in Britain and includes 50,000 current BT employees.

Welcoming the agreement between the scheme trustees and BT, Ben Marshall, Prospect Assistant General Secretary, said: "Against liabilities of about £40bn, this means that the BT pension scheme is now 95% fully funded.

"As a result the scheme is now safe for the pensioners of today and tomorrow. There are very few defined benefit schemes in the UK today that are as securely funded as this one.

"As well as benefiting employees and pensioners, it is also positive for both BT and UK plc. Consolidating BT's strong financial position will enable the company to continue to invest, particularly in Next Generation Broadband provision. That's good news for Britain's economic and social development."

Prospect represents BT's 24,000 managers and professionals.