Flexible Retirement Policy – BT Pension Scheme

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Flexible Retirement in BT (the ability to put pension into payment whilst continuing to work for BT)

This is of particular interest to members of the BT Pension Scheme who want (either now or in the future) to take their pension whilst continuing to work for BT. It does NOT apply to members of the BTRSS.



As you may recall, in February BT suspended the ability of individuals in the BTPS to put their pension into payment whilst continuing to work for the company. The initial intention was to suspend this option for a short period, whilst the issue was discussed between BT and the unions. In practice those talks turned out to be a great deal more complex and involved than was initially envisaged and it has taken until now for them to be concluded. They have now been concluded – without agreement between the company and the unions - and BT will be writing to all members of the BTPS in the next few days to outline the approach the company intends to take in future. 

In summary, the future position will be that individuals in certain categories will be able to apply for their pension to be put into payment if they meet certain criteria. Overall, the individual will need to be 55 or over (this is an HMRC requirement) and a member of the BT Pension Scheme (BTPS). The requirement for BT agreement to put pension into payment whilst continuing to work for the company varies from section to section. 

• Section A members of the BTPS, will not require agreement to put their pension into payment whilst continuing to work for BT  – however, please note that a Section A pension is normally significantly lower than a Section B pension, so opting for an early payment of the BTPS pension on Section A terms could be disadvantageous in the long term.

 • Section B members will not need BT agreement once they reach age 65.

 • Section C members will require BT agreement if they are under age 75. 

 BT has indicated that it is likely to give agreement to the individual putting their pension into payment whilst continuing to work for the company in the following circumstances:

  1. The member, their Line Manager and HR Business Partner all confirm that the individual has tendered their resignation and will be leaving the Business within the following three months.
  2. The member, their Line Manager and HR Business Partner all confirm that the individual has clearly agreed to leave Business before 14th September 2016 and where the member confirms that they have received financial guidance, for example, having attended a Wealth at Work seminar.
  3. The member can demonstrate that they will suffer financial hardship, or material detriment (for example, because a pensionable allowance such as shift allowance will cease to affect their pension), which would be alleviated by early payment of their pension but would not be overly detrimental to their future financial position.
  4. In addition, BT will continue to reserve its right to consent in certain other cases where it chooses to exercise discretion. 

Although there has been some alleviation of the blanket suspension of the ability of the individual to take their pension whilst continuing to work for BT, we do not believe the proposals the company is putting into place are consistent with the terms of the 2008 agreement between the company and the unions on BT pensions.

We have reluctantly accepted that, between the age of 55 and 60, BT does have the right to withhold consent from individuals seeking to put their pension into payment. But from age 60 onwards, in our view, the 2008 pension agreement gives individuals the right to put their pension into payment, whilst continuing to work for BT, without company consent. We and the CWU will therefore continue to make the case to BT and additionally will be raising it with the BTPS Trustees.

You can access the company’s letter to the unions here.