June 5, 2019 / 10:27 AM / 11 days ago

BT to close most of UK office locations under new CEO

(Reuters) - Britain’s former telecoms monopoly BT will consolidate its UK offices from 300 locations to roughly 30 sites while pressing ahead with plans to leave its St Paul’s headquarters in London, the company said on Wednesday.

FILE PHOTO: British Telecom's headquarters is seen in central London, Britain May 10, 2018. REUTERS/Hannah McKay/File Photo

New BT chief Philip Jansen inherited a major restructuring begun by predecessor Gavin Patterson as Britain’s biggest broadband supplier looks to move on from an accounting scandal and battles multiple pressures on its business.

The shake-up, including 13,000 job cuts, was announced a year ago and aims to tackle problems ranging from criticism of BT’s fiber broadband to an underperforming IT services business.

“Today, BT revealed the first eight of the locations that will house its workplaces of the future as part of a three-to-five-year program initially announced in May 2018 to improve and consolidate its workplaces across the UK,” the company said.

Belfast, Birmingham, Bristol, Cardiff, Edinburgh, Ipswich, London and Manchester would be key locations for the group, BT said in a statement.

BT, which employs over 100,000, gave no indication of the impact of the moves on jobs in particular locations.

A company spokeswoman confirmed that the office closures were in line with the plan revealed under Patterson last year to cut managerial and back-office jobs and move to a smaller London base.

The Communications Workers Union (CWU), BT’s main trade union, welcomed the company’s decision to consolidate its UK offices, but said the move was a huge logistical challenge.

“The CWU are in discussions with the company and during this process, our major focus will be on our members’ job security”, Deputy General Secretary Andy Kerr said.

MOVING HOME

The company, which has been based at the BT Centre, near St Paul’s Cathedral and the London Stock Exchange in the City of London since it was privatized in 1984, said on Wednesday it is currently identifying “a new home” for the business in the capital.

The program will consolidate BT’s “footprint” to around 30 sites “containing modern, future-fit buildings, including corporate offices, contact centers and specialist sites,” it said. All will be equipped with 5G connections.

“BT’s workplace improvement and consolidation program is the biggest of its type ever undertaken in the UK and is expected to complete by 2023,” BT said, adding that its telephone exchanges will be retained by the group.

BT has felt the effects of an accounting fraud in its Italy unit two years ago, which required the company to take a 530 million pound ($675 million) charge in early 2017, and a rocky relationship with Britain’s telcoms regulator.

BT, which owns Britain’s biggest mobile operator EE, said last month core earnings would drop again this year - the third decline in a row - to 7.2 billion-7.3 billion pounds.

Jansen, who took up the post in February, has vowed to roll out full-fibre broadband to 15 million homes by the mid-2020s, offering to spearhead Britain’s shift to ultrafast networks if the government and regulator make it worth its while.

Britain has lagged European rivals in building ultrafast connections, and BT, which operates the national fiber and copper-based network, has come under pressure to do more.

Reporting by Justin George Varghese; Editing by Patrick Graham/Keith Weir/ Kirsten Donovan

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