BT Pension Scheme Management, which manages the UK telecoms giant’s £47bn (€53.5bn) defined benefit (DB) pension scheme (BT Pension Scheme, BTPS), has rebranded as Brightwell and opened its funding, fiduciary and member services capabilities to third-party DB schemes.
Brightwell’s first new client is the £1bn DB section of EE Pension Scheme (EEPS), which has around 8,000 members.
Morten Nilsson, chief executive officer of Brightwell, said the rationale for the move was, in part, “to address value leakage”. BT’s pension fund shrank by an estimated £11bn last September in the wake of the market turmoil that followed former UK chancellor Kwasi Kwarteng’s “mini budget”.
BTPS said the scheme’s deficit was now close to £4.4bn.
Nilsson said: “We think there is so much to be gained by pension schemes collaborating, which would bring scale advantages. Defined benefit pension schemes are at an inflection point. The economic outlook is challenging, the portfolio risks posed by climate change need careful management and members expect high-quality online services which demand increased investment.
“We devised and implemented an ambitious programme of transformational improvement to the services we provide BTPS and learned a huge amount along the way.”
Nilsson said that Brightwell will look for further opportunities beyond the telecoms sector “with other schemes that have affinity with us”.
“It’s not a volume game,” he added. ”We’re not chasing AUM or members. Our interest is in really making sure we offer a very bespoke, very tailored service and that we continue to focus fully on the clients we serve, including the BT pension scheme.”
Brightwell will continue to support BT’s pension scheme and there will be no changes to the scheme itself or for its members’ day-to-day experience.
Otto Thoresen, chair of trustees at BTPS, said: “BTPS is maturing as a scheme. Making Brightwell’s services available to EE and other schemes helps to answer the challenge of the [BT] scheme securing access to the depth of resource we need to maintain quality service for our members and safeguard their long-term interests.”
Jonathan Clarke, chair at EEPS, believes the partnership will deliver significant benefits for the scheme and its members.
“As schemes like ours mature, it’s vital that they maintain access to the right mix of experience and expertise and we’re pleased to be working with a like-minded service provider able to meet our needs now and in the future,” he said.