Sunday 2 April 2017

Pensions Hole Deepens At Sir Philip Green's Arcadia

Sir Philip

The pension deficit at Sir Philip Green’s Arcadia Group soared to £565m last year as BHS was dragged to its knees by its own shortfall, according to new documents released last night by MPs.

The retail billionaire had said he would double his annual contribution into Arcadia’s pension fund to £50m. However, at that time it was believed the deficit was only £200m.

Now new papers, dated after the company’s triennial valuation, show the full severity of the issue. They also reveal that Sir Philip would have been paying only £15m until August before jumping to £35.5m last September.

In an attempt to address concerns about the viability of the pension fund, Arcadia, which includes the Topshop, Dorothy Perkins and Miss Selfridge brands, has appointed Ernst & Young to carry out an independent review of the scheme. The accountant said that the contributions were “at the top end of what the company could reasonably afford to pay”.

The scheme, which has 11,000 members, also includes a repayment timeframe of 13 years compared to the 23 years that was agreed for BHS.

Frank Field MP, chairman of the Commons work and pensions select committee, welcomed the new plan but said it was “clear from these figures that Sir Philip was long favouring the Arcadia schemes over their BHS counterparts, which have more members”.

He added: “Not long after he refused to shift on a ludicrous 23-year recovery plan for the BHS scheme, he agreed a 13-year plan for Arcadia with well over double the deficit contributions.” Sir Philip declined to comment.

Sir Philip had resisted demands from MPs to give details about how he would tackle Arcadia’s deficit while he was negotiating a deal to pump money into BHS’s pension scheme.

In February, Sir Philip bowed to intense pressure and volunteered to pay £363m into BHS’s pension fund after being threatened with enforcement action from The Pensions Regulator.



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