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MPs to demand Phillip Green pays £600m into BHS pension scheme

Frank Field MP

MPs holding an inquiry into the collapse of retailer BHS are set to ask former owner Sir Phillip Green to pay up to £600m to help close the pension scheme deficit.

According to the FT, Work and Pensions committee chair Frank Field said MPs would “laugh” if Green offered to pay anything less.

Field estimates the BHS’s scheme’s deficit has risen from £571m to around £600m since the firm has entered liquidation.

He said: “If any proposal amounts to anything less than that, the committee will just laugh at him.”

He added: “The evidence we have been hearing about the BHS sale has been very worrying and disconcerting.

“The committee may have considered a reasonable settlement in the very early days of our inquiry, but things have changed.”

“Sir Philip needs to convince us that he’s come up with the very best deal for those pensioners.”

Green, whose Acardia Group sold BHS for £1 to serial bankrupt Dominic Chappell in 2015, is due to give evidence as part of the inquiry this week.

He called for Field to step down as chair of the inquiry after the politician said he would back calls for Green to be stripped of his knighthood if he did not fill the scheme’s funding blackhole.

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Comments

There are 4 comments at the moment, we would lover to hear your opinion too.

  1. This is such a load of nonsense. BHS has nothing to do with Phillip Green now. The only pertinent question he has to answer is why he sold to Retail Acquisitions rather than to a more established suitor.

    Green could have sold BHS for (say) £500 million and then sorted some of the deficit, but instead he sold it for £1 and the purchaser had to sort the deficit. Most DB schemes run at a deficit and are not expected to clear it in one go. Green had reduced the deficit during his tenure and operations like this tend to take time.

    Anyway a good slug of the problem lays with the Governments stupid rules, proving yet again how little those in Westminster understand pensions. (Why should they – they have their own cushy number).

    There are fewer and fewer DB schemes paying more and more into the PPF. The knee jerk rules put in place after Maxwell completely ignore commercial reality and remain rigidly inflexible. Sure, there has to be some level of protection for those in the scheme, but some kind of orderly exit from these schemes needs to be worked out. We all see the evidence of when we have a benefit agency running a business. General Motors was a prime example and here in the UK we have too many benefit agencies trying to run a business, from Airlines to Telecoms. As an investor I refuse to invest in any company that has a DB scheme and if others are wise they should do likewise. It is the old question – a job with a reduced pension, or no job and an even more reduced pension.

  2. @ Harry Katz
    Are you sure Green reduced the deficit while he was the owner Harry. I thought the scheme had a small surplus when he bought BHS, and that he took a half a billion or so from the company while he was the owner.

  3. “The committee may have considered a reasonable settlement in the very early days of our inquiry, but things have changed.”….. And precisely what can/will they do if he doesn’t make a settlement?

  4. As I understand it Patrick there was a deficit when he took over and he reduced it a little during his tenure. Unfortunately with so much to read I can’t recall the source and it may well be that it’s accuracy is questionable – as with so many other things!

    As we all know the Press is notoriously unreliable! It is difficult to obtain unimpeachable statistics on this.

    Green is by no means as white as the driven snow and by all accounts (my wife actually had business dealings with him in the early 90’s) he is a rather unprepossessing character. But as in all things he’s not quite as black as he is painted in this matter and there ate shades of grey.

    Yet again we have Parliament grandstanding – one of the contributory reasons why they are held in such low esteem.

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