1. Operate’s people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 12,460 FTE: - 12,301 direct labour - 159 agency New roles for redeployees 299 people in BTTC at 10/11 YE 558 new entrants into BTTC as of end Q3 11/12 648 resolutions by end Q3 11/12 209 people in BTTC at end Q3 11/12 Average resolution time reduced : -164 (09/10) to 100 (10/11) to 115 (11/12 Q3) Sick Absence 1.74% days lost YTD (Q3) Improving vs 10/11 (1.94%) The right skills Training & education BTO is investing £6m in 2011/12, incl: £1,568k in Service Delivery £465k in Security £554 kin Service Infra £408 kin Service Mgt £501k in S&SI Talent Pool 185 managers in BTO Talent pool for 2011 (15% increase on 2010) But down to 159 in Q3 (Net exporter) Your views CAREagile Q3 EEI improved to 3.59 (3.53 Q2) Q3 PCI improved to 3.76 (3.72 Q2) Q3 SMP improved to 3.31 (3.23 Q2) Recognition Promotions 158 across BTO by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 368 (40 yr) & 40 (45 yr) awards in next year Recruitment 206 External Hires to end Q3 in 11/12 - Skill Hires 105 - Apprentices 76 - Grads / Fast trackers 25 Continually improving our performance Getting involved BT Challenge Cup (Tournament 7) 81 BTO teams registered, with 8 teams making it through to semi finals & 71 in Blue Riband 2012 Olympics/ Sprints 27 BTO people received Sprint 7 Certificates and 95 received Sprint 8 Certificates -With 424 BTO Certificates issued in Sprints 1 -6 BTO Volunteers By end Q2, 4% of BTO people had completed a volunteering activity. But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target. Updated Jan 2012 (Q3 results) Future Leaders Programme 64 Team Members completed FLP2 - All 64 completing NVQ L3 in Mgt - 12 have already been promoted 67 delegates start FLP3 on 25 Jan - SD 31 - SI 13 - SM 12 - Security 6 - MSL 5 Rating Number% Q1 2011/12 306 2483 2%E VG AS DN U 20% 60% 16% 1% 7348 1905 85 Rating Number% Q2 2011/12 377 2506 7294 1717 84 3% 20% 60% 15% 1% E VG AS DN U

2. BTO MSL’s people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 616 FTE: - 608 direct labour - 8 agency New roles for redeployees Not applicable Sick Absence 2.97% days lost in Q3 (BTO 1.74%) Declining versus 10/11 YE (2.52%) The right skills BTO Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 5 but now 4 from MSL (1 leaver by end Q3) Your views CAREagile Q3 EEI improved & PCI static (from Q2 11/12): EEI: 3.48 (3.43) (BTO: 3.59) PCI: 3.68 (3.68) (BTO: 3.76) Q3 SMP also improved to 3.22 (3.14 Q2) Recognition Promotions 0 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 0 (40 yr) & 0 (45 yr) awards in next year Recruitment 0 External Hires to end Q3 in 11/12 - Skill Hires 0 - Apprentices 0 - Grads / Fast trackers 0 Continually improving our performance Getting involved Rating Number% Q1 2011/12 11 126 395 56 0 1.8% 21.1% 66.1% 9.4% 0.0% E VG AS DN U Rating Number% Q2 2011/12 15 137 404 36 0 2.5% 22.7% 67.0% 6.0% 0% E VG AS DN U Training & education BTO is investing £6m in 2011/12, incl: £1,568k in Service Delivery £465k in Security £554 kin Service Infra £408 kin Service Mgt £501k in S&SI BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (0 From MSL) & 71 in Blue Riband (Although 0 From MSL) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – although none from MSL BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 2.27% in SD &MSL But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 6.01% in SD & MSL Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - including the 5 from MSL 12 have already been promoted - including all 5 from MSL 67 delegates start FLP3 on 25 Jan - including 5 from MSL Updated Jan 2012 (Q3 results)

3. BTO Security people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 1195 FTE (not incl GES): - 1121 direct labour - 74 agency New roles for redeployees 12people in BTTC at 10/11 YE 33 new entrants into BTTC by end Q3 27 resolutions by end Q3 11/12 18 people in BTTC at end Q3 Sick Absence 1.79% days lost in Q3 (BTO 1.74%) Still improving versus 10/11 (1.83%) The right skills Training & education Investing £6m in 2011/12: £465k in Security BTO Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 13 but now 12 from Security (3 leavers & 2 joiners by end Q3) Your views CAREagile (including GES) Q3 EEI &PCI both declined (from Q2 11/12): EEI: 3.70 (3.77) (BTO: 3.59) PCI: 3.81 (3.87) (BTO: 3.76) Q3 SMP also declined to 3.57 (3.63 Q2) Recognition Promotions 49 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 14 (40 yr) & 0 (45 yr) awards in next year Recruitment 21 External Hires to end Q3 in 11/12 - Skill Hires 20 - Apprentices 0 - Grads / Fast trackers 1 Continually improving our performance Getting involved Rating Number% Q1 2011/12 11 150 638 232 5 1.0% 14.3% 60.6% 22.1% 0.5% E VG AS DN U Rating Number% Q2 2011/12 20 207 627 190 4 1.8% 18.9% 57.2% 17.3% 0.4% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (1 From Security) & 71 in Blue Riband (6 from Security) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 68 from Security Security Volunteers (Incl. GES) By end Q2, 4% of BTO people completed a volunteering activity - 4.59% in Security But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 12.77% in Security Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - including the 3 from Security 12 have already been promoted - 0 from Security 67 delegates start FLP3 on 25 Jan - including 6 from Security Updated Jan 2012 (Q3 results)

4. BTO Service Delivery people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 6,338 FTE: - 6,276 direct labour - 62 agency New roles for redeployees 103 people in BTTC at 10/11 YE 220 new entrants into BTTC by end Q3 244 resolutions by end Q3 11/12 79 people in BTTC at end Q3 Sick Absence SD: 1.97% days lost in Q3 (BTO 1.74%) Improving versus 10/11 wrt both FE (2.41%) and L2C (2.15%) The right skills Training & education Investing £6m in 2011/12: £1,568k in Service Delivery BTO Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 70 but now 59 from SD (19 leavers & 8 joiners by end Q3) Your views CAREagile Q3 EEI & PCI both improved (from Q2 11/12): EEI: 3.48 (3.41) (BTO: 3.59) PCI: 3.70 (3.65) (BTO: 3.76) Q3 SMP also improved to 3.16 (3.06 Q2) Recognition Promotions 51 by Q2 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 252 (40 yr) & 31 (45 yr) awards in next year Recruitment 89 External Hires to end Q3 in 11/12 - Skill Hires 74 - Apprentices 0 - Grads / Fast trackers 15 Continually improving our performance Getting involved Rating Number% Q1 2011/12 139 1189 3856 830 57 2.3% 19.4% 62.8% 13.5% 0.9% E VG AS DN U Rating Number% Q2 2011/12 179 1123 3860 888 52 2.9% 18.2% 62.4% 14.4% 0.8% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (3 From SD) & 71 in Blue Riband (36 from SD) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – 263 from SD BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 2.07% in SD But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 6.01% in SD Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - including the 34 from SD 11 have already been promoted - 3 from Service Delivery 67 delegates start FLP3 on 25 Jan - including 31 from Service Delivery Updated Jan 2012 (Q3 results)

5. BTO Finance people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 57 FTE: - 57 direct labour - 0 agency New roles for redeployees 3people in BTTC at 10/11 YE 6 new entrants into BTTC by end Q3 7 resolutions by end Q3 11/12 2 people in BTTC at end Q3 Sick Absence 0.61% days lost in Q3 (BTO 1.74%), improving from Q2 but still slightly adverse versus 10/11 (0.60%) The right skills Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 6 but now 5 from Finance (3 leavers & 2 joiners by end Q3) Your views CAREagile Q3 EEI & PCI both improved (from Q2 10/11): EEI: 3.43 (3.40) (BTO: 3.59) PCI: 3.60 (3.55) (BTO: 3.76) But Q3 SMP declined to 3.58 (3.66 Q2) Recognition Promotions 1 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 1 (40 yr) & 0 (45 yr) awards in next year Recruitment 1 External Hire to end Q3 in 11/12 - Skill Hires 1 - Apprentices 0 - Grads / Fast trackers 0 Continually improving our performance Getting involved Rating Number% Q1 2011/12 0 11 42 19 0 0.0% 15.1% 57.5% 26.0% 0.0% E VG AS DN U Rating Number% Q2 2011/12 0 11 42 13 1 0% 15.7% 60.0% 18.6% 1.4% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (0 From Finance) & 71 in Blue Riband (Although 0 from Finance) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 2 from Finance BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 1.41% in Finance But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 57.75% in Finance Future Leaders Programme 64 Team Members completed FLP2 - All 64 completing NVQ L3 in Mgt - 12 have already been promoted 67 delegates start FLP3 on 25 Jan - SD 31 - SI 13 - SM 12 - Security 6 - MSL 5 No participants from Finance Training & education BTO is investing £6m in 2011/12, incl: £1,568k in Service Delivery £465k in Security £554 kin Service Infra £408 kin Service Mgt £501k in S&SI Updated Jan 2012 (Q3 results)

6. BTO HR people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 306 FTE (incl apprentices): - 306 direct labour (incl apprentices) - 0 agency New roles for redeployees 1people in BTTC at 10/11 YE 5 new entrants into BTTC by end Q3 6 resolutions by end Q3 11/12 0 people in BTTC at end Q3 Sick Absence 1.82% days lost in Q3 (BTO 1.74%), improving from Q2 but still adverse versus 10/11 (1.78%) The right skills Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 15 but now 10 from HR (8 leavers & 3 joiners by end Q3) Your views Recognition Promotions 4 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 3 (40 yr) & 0 (45 yr) awards in next year Recruitment 79 External Hires to end Q3 in 11/12 - Skill Hires 2 - Apprentices 76 - Grads / Fast trackers 1 Continually improving our performance Getting involved BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (0 From HR) & 71 in Blue Riband (1 from HR) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 10 from HR BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 16.18% in HR But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 41.75% in HR Rating Number% Q1 2011/12 0 26 80 14 1 0% 20.3% 62.5% 10.9% 0.8% E VG AS DN U Rating Number% Q2 2011/12 32 71 12 1 2.5% 26.9% 59.7% 10.1% 0.8% E VG AS DN U Does not include apprentices BTO is investing £6m in 2011/12, incl: £1,568k in Service Delivery £465k in Security £554 kin Service Infra £408 kin Service Mgt £501k in S&SI Specifically in HR: Development Development centers Contracting workshop Analysis workshop Investment in OE upskilling AIM HRBP knowledge sharing session OCI accreditation CIPD funding Coaching for Excellence CAREagile (100% sample on quarterly basis) Q3 EEI & PCI improved (from Q2 11/12): EEI: 4.07 (3.99) (BTO: 3.59) PCI: 4.16 (4.04) (BTO: 3.76) Q3 SMP declined to 3.93 (3.96 Q2) 3 Updated Jan 2012 (Q3 results)

7. BTO Service Infrastructure people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 1.736 FTE: - 1,733 direct labour - 3 agency New roles for redeployees 84people in BTTC at 10/11 YE 126 new entrants into BTTC by end Q3 158 resolutions by end Q3 11/12 52 people in BTTC at end Q3 Sick Absence 1.11% days lost in Q3 (BTO 1.74%) Improving versus SA in 10/11 (1.41%) The right skills Training & education Investing £6m in 2011/12: £554k in Service Infrastructure Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 16 but now 14 from SI (7 leavers & 5 joiners by end Q3) Your views CAREagile Q3 EEI & PCI both improved (from Q2 11/12): EEI: 3.73 (3.62) (BTO: 3.59) PCI: 3.85 (3.76) (BTO: 3.76) Q3 SMP also improved to 3.40 (3.35 Q2) Recognition Promotions 14 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 42 (40 yr) & 8 (45 yr) awards in next year Recruitment 2 External Hires to end Q3 in 11/12 - Skill Hires 2 - Apprentices 0 - Grads/ Fast trackers 0 Continually improving our performance Getting involved Rating Number% Q1 2011/12 53 435 1032 353 6 2.8% 23.0% 54.5% 18.6% 0.3% E VG AS DN U Rating Number% Q2 2011/12 64 418 1033 276 6 3.5% 23.0% 56.8% 15.2% 0.3% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (1 From SI) & 71 in Blue Riband (16 from SI) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 56 from old SA (Sprints 1- 4) and 57 for SI on Sprints 5 - 8 BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 5.85% in SI But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 14.53% in SI Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - 18 from old Service Assurance BU 11 have already been promoted - 2 from old Service Assurance BU 67 delegates start FLP3 on 25 Jan - including 13 from Service Inf Updated Jan 2012 (Q3 results)

8. BTO Service Management people - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 1,436 FTE: - 1,428 direct labour - 8 agency New roles for redeployees 69people in BTTC at 10/11 YE 111 new entrants into BTTC by end Q3 139 resolutions by end Q3 11/12 41 people in BTTC at end Q3 Sick Absence 1.50% days lost in Q3 (BTO 1.74%) Adverse versus SA in 10/11 (1.41%) The right skills Training & education Investing £6m in 2011/12: £408k in Service Management Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 14 but now 12 from SM (6 leavers & 4 joiners by end Q3) Your views CAREagile Q3 EEI & PCI both improved (from Q2 11/12): EEI: 3.70 (3.61) (BTO: 3.59) PCI: 3.81 (3.75) (BTO: 3.76) Q3 SMP also improved to 3.45 (3.26 Q2) Recognition Promotions 35 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 30 (40 yr) & 0 (45 yr) awards in next year Recruitment 10 External Hires to end Q3 in 11/12 - Skill Hires 6 - Apprentices 0 - Grads/ Fast trackers 4 Continually improving our performance Getting involved Rating Number% Q1 2011/12 44 289 736 256 12 3.2% 21.3% 54.2% 18.9% 0.9% E VG AS DN U Rating Number% Q2 2011/12 52 339 802 196 13 3.7% 23.9% 56.4% 13.8% 0.9% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (2 From SM) & 71 in Blue Riband (6 from SM) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 56 from old SA (Sprints 1- 4) and 24 for SM on Sprints 5 - 8 BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 5.62% in SM But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 21.84% in SM Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - 18 from old Service Assurance BU 11 have already been promoted - 2 from old Service Assurance BU 67 delegates start FLP3 on 25 Jan - including 12 from Service Mgt Updated Jan 2012 (Q3 results)

9. BTO Strategy & Service Introduction - The difference is you Our people - the right people in the right roles Our workforce (at Q3 2011/12) 705 FTE: - 705 direct labour - 0 agency New roles for redeployees 26people in BTTC at 10/11 YE 48 new entrants into BTTC by end Q3 59 resolutions by end Q3 11/12 15 people in BTTC at end Q3 Sick Absence 1.60% days lost in Q3 (BTO 1.74%) Improving versus 10/11 (1.76%) The right skills Training & education Investing £6m in 2011/12: £501k in Strategy & Service Introduction Talent Pool 185 managers in BTO talent pool for 2011 (15% increase on 2010) Was 36 but now 29 from S&SI (10 leavers & 3 joiners by end Q3) Your views CAREagile Q3 EEI & PCI both improved (from Q2 11/12): EEI: 3.76 (3.71) (BTO: 3.59) PCI: 3.86 (3.85) (BTO: 3.76) Q3 SMP also improved to 3.56 (3.43 Q2) Recognition Promotions 2 by end Q3 Smooth Operators (Q3 Results) Q3 statistics still being validated Long Service 24 (40 yr) & 1 (45 yr) awards in next year Recruitment 4 External Hires to end Q3 in 11/12 - Skill Hires 0 - Apprentices 0 - Grads/ Fast trackers 4 Continually improving our performance Getting involved Rating Number% Q1 2011/12 44 205 411 111 0 5.6% 25.9% 52.0% 14.0% 0.0% E VG AS DN U Rating Number% Q2 2011/12 44 205 355 85 6 6.2% 28.7% 49.7% 11.9% 0.8% E VG AS DN U BT Challenge Cup 81 BTO teams registered, with 8 teams making it through to semi finals (1 from S&SI) & 71 in Blue Riband (6 from S&SI) 2012 Olympics/ Sprints 546 BTO people received certificates (Sprints 1 - 8) – including 39 from S&SI BTO Volunteers By end Q2, 4% of BTO people completed a volunteering activity - 5.0% in S&SI But by end Q3, following 2012 sprint 8, BTO hit 12.5 % target – 25.42% in S&SI Future Leaders Programme 64 Team Members completed FLP2 All 64 completed NVQ L3 in Mgt - including all 4 from S&SI 11 have already been promoted - 1 from S&SI 67 delegates start FLP3 on 25 Jan - SD 31 - SI 13 - SM 12 - Security 6 - MSL 5 No participants from S&SI this time Updated Jan 2012 (Q3 results)