HC Deb 18 November 1982 vol 32 cc276-7W
Mr. Bulmer

asked the Secretary of State for Industry if he will make a statement on British Telecom's financial objective.

Mr. Patrick Jenkin

Following a review of BT's prospects for 1983–84 I have set the corporation a financial objective of a real rate of return of 6½ per cent. for that year. As with the previous target, "real return" is defined as profit before interest payable but charging historic and supplementary depreciation as a percentage of mean net assets revalued to replacement cost.

The chairman has undertaken to constrain BT' s deferred tariff package, which will not in any event be introduced before April 1983 at the earliest. The increase in average bills will be no more than 3.3 per cent.

BT will at the same time introduce a rebate scheme which will refund part of the standing charge to consumers who make little use of their telephones for outward calls.

These measures, together with the external financing limit of £120 million as laid before Parliament on 8 November will keep BT under pressure to increase efficiency and should provide greater internal resources to fund its investment programme.