The Pensions Regulator (TPR) has tonight intensified its investigation into Sir Philip Green as it seeks to end the crisis engulfing the retirement scheme of collapsed retailer BHS.
Lesley Titcomb, the head of the pensions watchdog, announced late on Wednesday that TPR is to escalate its enforcement action as it seeks redress for 20,000 BHS pension scheme members.
Green, the parent company of his empire Taveta Investments, Dominic Chappell, who was sold BHS last year, and his company Retail Acquisitions have each been sent warning notices – setting out evidence to support the use of contribution notices and financial support directions, which would demand money from the parties.
The warning notices sent to Green and Taveta differ from those issued to Chappell and Retail Acquisitions.
Each party now has the opportunity to respond to the notices, which run to more than 300 pages.
TPR remains open to solutions to the pension deficit outside of this process.
BHS’ pension deficit stood at £571m when Green sold the company to Chappell’s Retail Acquisitions for £1 in March last year.
Titcomb said: “Our decision to launch enforcement action is an important milestone in our work to attain redress for the thousands of members of BHS schemes who have been placed in this position through no fault of their own.”
Green responded with a statement claiming he had provided TPR with “what I believe to be a credible and substantial proposal, with evidence and bank confirmation of cash availability, which would prevent the scheme from entering the Pension Protection Fund”.
This is in order to achieve a better outcome for the BHS pensioners.
I have also spoken to the chairman of the trustees who is supportive of the proposal on the basis that it provides members with better benefits than they would receive from the PPF.
I believe the above statement confirms the statement of intent that I made in regard to the BHS pensioners.
The move was welcomed by Frank Field MP, chair of the Work and Pensions Committee, who has been highly critical of Green since the collapse of the retailer.
“We are not surprised that the Pensions Regulator has, like all the rest of us, lost patience with Sir Philip Green’s excuses and empty promises,” Field said in a statement.
“His answer throughout our inquiry was always that he was going to ‘sort’ the disastrous position he left the pension fund in when he sold off BHS to Dominic Chappell for £1.
“We are glad to see TPR is now calling his bluff and instigating enforcement proceedings. It seems clear Sir Philip would rather kick the can down the road and avoid responsibility than come up with any fair, sustainable settlement for BHS pensioners.”
Iain Wright MP, chair of the Business, Energy and Industrial Strategy Committee, said:
In June Sir Philip told us he would sort out the pensions mess at BHS. Five months on, we’ve seen Philip Green sunning himself on his yacht - his third - but no credible plan or cash on the table.
He is meant to be able to do deals quickly but he hasn't been keen to do a deal which would quickly end the misery for thousands of BHS pensioners.
Sir Philip said he would sort it but he has not yet been true to his word. He has not come up with the money to satisfy the regulator, who has clearly and quite rightly now lost patience with his obviously empty promises.
Labour’s shadow secretary of state for business, energy and industrial strategy Clive Lewis MP said:
Four months after Sir Philip Green promised to make good the pensions deficit created by his shoddy management of BHS, and weeks after MPs voted unanimously to strip Green of his knighthood, tens of thousands of pensioners are still waiting to find out the fate of their pensions.
Let's hope that, by stepping up their investigations, the pensions regulator will finally hold Philip Green to account and give those pensioners the security they deserve.