A decision on an alleged £28 billion state guarantee of BT’s pension fund has been reached by ministers and is expected to be announced shortly.

The Department of Trade and Industry said that it had received final legal advice on the so-called “Crown guarantee” that BT maintains covers 75 per cent of its liabilities if it were to go bankrupt.

The DTI is now in detailed discussions with the telecoms group about its conclusions.

The Government’s decision on the pledge – described by Sir Tim Chessells, the chairman of the BT trustees, as “an important insurance policy” for pension fund members – will have wide-ranging implications for BT and could determine whether the group finds itself embroiled in lengthy legal action.

The talks are one area on which investors are expected to quiz the telecoms group today at its full-year figures.

Also at the presentation Sir Christopher Bland, the retiring chairman, is expected to round off his tenure by unveiling a share buyback of up to £2 billion, funded by borrowing against its independent Open-reach arm, and announce record revenues of £20.3 billion.

The existence of a government pledge to underwrite BT’s pension fund emerged only last year, although it was made by ministers at the time of the group’s privatisation.

Sir Christopher has said that the group was satisfied that it had all the legal clarity it needed over the guarantee and the extent of the pension scheme covered by it.

However, the DTI has consistently refused to confirm that position, fuelling speculation that it was seeking to wriggle out of the pledge. It would say only that it was taking legal advice.

A refusal by the Government to stand by the pledge – or the value attributed to it by BT – could force the group to take legal action to secure official recognition.

Ironically, if the Government backs BT’s position the group could itself face legal action as lawyers in the UK have said that the pledge bears “many of the hallmarks” of state aid.

They maintain it could have given BT financial advantages, such as a better credit rating or better terms on loans, than rivals that do have not such a guarantee.

One competitor has already complained to the European Commission that it could constitute state aid.

A spokesman for the DTI said: “We have received legal advice and we are now discussing it with BT and the BT pension fund trustees. While these discussions continue we're not in a position to say anything further.” He said the issues were “complex.”

BT declined to comment.

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