Sounds like bollocks to me mate. All Mk4 Escort speedo are mechanical and that pulse device is for the fuel computer. The speedo cable screws into to top of the pluse device.

I hate to say this but 95% of the time when these speedos stop working its not the cable at all - it's the worm gear in the gearbox.

Does you fuel computer register anything other than 0MPG? If so the gearbox is OK, if it always sits on 0 then it is more than likely the gearbox at fault.