BT urged to rethink its cuts as discontent grows

BT urged to rethink its cuts as discontent grows

New analysis by Prospect shows that spending on research and development by telecoms company BT has fallen by 48% in real terms since 2009 and is now second lowest among its G7 competitors

Ahead of BT’s AGM, taking place in Edinburgh today (Wednesday 11 July), Prospect called on shareholders to consider these figures as the company plans to cut 13,000 jobs from the management structure.

BT’s R&D is nationally important, as BT has been third highest investor in R&D in the UK over the past ten years.

Prospect national secretary Philippa Childs said: “Shareholders should be aware that BT’s plans to cut 13,000 jobs from the management structure have been very disruptive.

“BT has been working with Prospect to ensure that there is continued dialogue on how the redundancy process is carried out – most importantly to ensure that there are no compulsory redundancies.

“However, the AGM is an opportunity for shareholders to scrutinise how best the plan will prepare the company for the future. At a time when the entire telecoms industry is changing these cuts – both in R&D and in staffing – could have a lasting negative impact on the future of the company.”


R&D spending in telecoms sector – BT & G7 comparators (+ Spain)


2017 R&D spend (USD Bn)

Nippon Telegraph & Telephone Corp. (Japan)




Deutsche Telekom (Germany)


Telefonica (Spain)


Telecom Italia (Italy)


Orange (France)


BT Group (UK)


BCE (Canada)


Source: PWC R&D study 2017


Shareholders’ remuneration vote

It was also revealed today that 34% of shareholders have opposed the remuneration report presented to the AGM, which included £2.3m for chief executive Gavin Patterson in 2017.

The result will see BT placed on a public register of firms where more than 20% of shareholders have opposed a resolution.

BT expressed disappointment in the “lower level of support” for the remuneration report, suggesting it was, in the most part, attributable to the annual bonus payment to the chief executive for the 2017-18 performance year. The company statement said: “During the remainder of 2018 we will engage further with our shareholders and proxy advisers to understand in full detail the reasons for their concerns and whether we should consider any changes to our longer term approach to remuneration.”

Philippa Childs said of the vote: “This is another indication of the general discontent with the strategic direction being taken by the company.

“For our own members this is expressed in terrible uncertainty about their own futures, and for those left behind, big questions about how the work will be done.

“We do not believe that it is possible to cut thousands of jobs without causing significant harm to the company’s operations.

“We are calling on BT to sit down with Prospect and discuss how to stop these very damaging cuts and instead draw up a resourcing plan that is realistic, achievable and which recognises employees’ skills and expertise.

“It’s time for the company to put people first, and in our experience that’s the approach that will pay off both within the company and in terms of BT’s contribution to the wider UK economy.”