When BHS collapsed into administration last April, bringing an end to nearly a century of trading on the high street, it was left with a massive deficit in its pension scheme. Despite Sir Philips assurances that he would personally deal with the matter, he has, as yet, done nothing at all to address the £570m shortfall.
The collapse of the BHS retail chain resulted in job losses of over 11,000 jobs and left pensioners with massive shortfalls in their anticipated retirement incomes, sparking a bitter row between its former owners, advisers, regulators and BHS’s administrators.
Green sold BHS for £1 in 2015 to a group of investors led by Dominic Chappell who had previously been declared bankrupt. The administrators were called in April this year but with the last of its 170 stores shut at the end of the summer.
The billionaire tycoon Sir Philip Green looks close to a deal set to salvage the pensions of thousands of ex-BHS workers in a deal likely to cost him in excess of £350m.The former owner could be just a matter of days away from signing a deal with The Pensions Regulator to address the BHS scheme’s controversial deficit.
The last formal valuation of the pension deficit stood at £571m but is thought to have increased recently because of the as ultra-low interest rates have depressed gilt yields.
However, the agreement could leave BHS pensioners continuing to face some cuts to their benefits, although any settlement reached would have to be an improvement on the terms of the industry-funded lifeboat, the Pension Protection Fund (PPF)
It is considered likely that a deal could be struck as soon as next week, however, eight months after Sir Philip’s pledge to sort out the problem no details of his plans have yet been released.
Any deal will be carefully watched over by MPs on the Commons Work and Pensions Select Committee. The chairman, Frank Field, has fought a long battle to persuade Sir Philip to pay up.
Sir Philip, who owns famous brand stores such as Top Shop and Dorothy Perkins, has been at war with Mr. Field and MPs who demanded that he be stripped of his knighthood.
Sir Philip was seeking a promise from the regulators that they would abandon their anti-avoidance probe into BHS’s pension deficit if he were to make made a “voluntary” financial contribution to the retirement pots of thousands of former employees.