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BT's long-running dispute with the Communications Workers Union (CWU) over increased allowances for staff who work in London could be settled soon.

The CWU is recommending that its members accept an offer from BT to raise levels of London Weighting.

The new offer includes an increase of £200 with effect from 1 March, with another rise of £25 from 1 Jan, 2005.

If accepted, it would increase Inner London Weighting by 8.6 per cent from £2,600 to £2,825 and Outer London Weighting by 20 per cent from £1,128 to £1,353.

The allowances - which compensate workers for the greater expense of living and working in London - have been frozen since 1999.

The CWU said the deal "reflects the best that can be achieved by negotiation". A ballot of members is expected soon.

In December the CWU described as "derisory and completely unacceptable" BT's offer of an extra £100 for London weighting. The CWU had called for London weightings of £4,000 and £2,400. ®

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