Trustees at BT's 163 million pound defined contribution pension scheme have made a clean sweep of all their current fund managers.

The plan, which has 15,000 active members and 1400 deferred members, has dropped Barclays Global Investors (BGI) for UK and global equities, managed on an active basis, after it failed to meet its benchmark over a three year period.

In addition BT's 'in-house' fund manager Hermes has withdrawn from managing equities, bonds and cash on a passive basis, so relinquishing its role in managing the plan's other funds. Trustees at the plan, which is advised by Hewitt Associates, have replaced these managers with Schroders and Legal and General Investment Management (LGIM).

Schroders will manage an active global equity fund, while LGIM will manage a passively run global equity fund. The plan's lifestyle option will split its assets between these two managers.

LGIM will also manage the fund's other investment choices; a passive UK equity fund, a passive mixed bond fund, gilts and an active cash fund.

In a message to members, trustees said the switch came about after BGI delivered returns of 16.2pc over three years for UK equities against a benchmark return of 18pc and underperformed its global equity benchmark by 0.2pc over three years too. The changes to the funds are taking place between October and January.

In a long letter to members, that reassures members that the changes will not mean any loss of accrued pension, the trustees wrote: "The trustees have been concerned for some time that BGI were not meeting their investment targets. Our investment specialists advised us that, based on future estimates of their investment performance, BGI was no longer a suitable investment manager for the plan."