Worries about the growing pension fund deficit at BT Group have overshadowed better than expected third-quarter profits from the UK telecoms operator.

BT revealed that the fund, one of the largest in the UK, is facing a 2002 pension deficit of £1bn (€1.5bn) to £1.5bn - up from £200m at the end of March 2000. It went on to warn that the next triennial pension funding valuation, due later this year, could reveal an even higher shortfall.