MPs demand Sir Philip Green ends BHS black hole

Helen Cahill and Tracey Boles
Top Shop, Kate Moss Clothes Range
Sir Philip Green owned BHS for 15 years (Source: Getty)
top group of MPs has made fresh demands that Sir Philip Green dig deep to plug the gap in BHS’ pension fund as new figures reveal the magnitude of the shortfall.

City A.M. can reveal that Duff & Phelps, the administrators salvaging the wreckage of BHS, are set to contribute a maximum of £45.7m in recovered monies to the failed retailer’s pension deficit – leaving a hole of at least £525m.

“Six months ago Sir Philip promised parliament that he would ‘sort’ the pension scheme, but he hasn’t done that,” said Frank Field chair of the Work and Pensions Select Committee which grilled Green over the retailer’s collapse earlier this year.

“He has made that promise in many ways, many times, before and since. But he hasn’t done it. The Pensions Regulator, after two years of negotiations, asked him to make a reported £350m contribution to the hole in the pension fund. He hasn’t done that.

“I would like to ask now, on behalf of the BHS pensioners: Sir Philip, what have you sorted? What a fantastic Christmas gift it would be to the 20,000 pensioners counting on Sir Philip if he were to keep that promise now.”

Green has been in talks with the pensions regulator about making a contribution, but one offer was rejected as too low.

In a report to creditors submitted to Companies House last month, Duff & Phelps said it expects to return a dividend of between 2p and 8p in the pound to BHS’ unsecured creditors, including to the Pension Protection Fund (PPF), the so-called pensions lifeboat which is preparing to take on BHS’ pension scheme.

On the basis that the PPF will get a maximum of 8p for every £1, the pensions gap could at best be narrowed from £571m to £525m with a contribution of £45.7m.

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At worst, the pension deficit would stand at £559.6m after a smaller contribution from the administrators.

The exact sum left for the pension fund will depend on how much money other secured creditors claim from the carcass of BHS.

In total, BHS has 7,500 creditors, with claims totalling £1.3bn, the report stated. Some of the secured creditors have been paid in full but as one of BHS’ unsecured creditors the PPF, which is acting as a caretaker for the pensioners, has not yet received its share of the BHS empire.

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A PPF spokesperson said: “Members of the BHS pension schemes can be reassured that they continue to be protected by the PPF. Meanwhile the liquidator is now working to maximise the recovery to the pension schemes.”

Sir Philip Green and Duff & Phelps declined to comment on the administrator’s report.

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