Nov 23, 2016
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UK regulator says earliest could force Green to redress BHS pension is mid-2017

Nov 23, 2016

Britain's pensions regulator probably won't be able to demand payments from former BHS owner Philip Green to plug a hole in the collapsed retailer's pension fund until mid-2017 at the earliest, its boss said on Wednesday.

Lesley Titcomb, chief executive of The Pensions Regulator, also told lawmakers that any demand could then be appealed through the courts, potentially adding months or even years, to the process.

Philip Green

"Things are at a very, very early stage at the moment," she said during an appearance before a parliamentary committee.

Billionaire Green sold the loss-making department store chain last year to Dominic Chappell, a serial bankrupt with no retail experience, for one pound ($1.2) with a pension fund deficit.

The deficit had ballooned to 571 million pounds by the time BHS went into administration in April this year. If not filled, this will leave 20,000 BHS pensioners facing significant cuts to their income.

BHS closed the last of its stores in August and 11,000 jobs were lost in total.

Green had promised in June to "sort" the pensions issue but Titcomb said earlier this month that he had not made a comprehensive and credible offer, a claim Green disputes.

She began enforcement action this month to seek redress on behalf of the BHS pension schemes by issuing "Warning Notices" to Green, his holding companies, Chappell and his vehicle Retail Acquisitions.

Titcomb told parliament's Work and Pensions Committee on Wednesday that recipients of the warning notices had been given time to respond. When they do so the Pensions Regulator will then decide whether to take cases to its Determinations Panel.

That panel, which operates at arm's length from the regulator's case teams, will make a final decision on whether the parties must fill the hole in the pension fund.

"They (the panel) will set their own timetable as to when that hearing happens. That is unlikely to be, I would have thought, before the middle of next year," she said.

"In the meantime our door remains open to any further offers."

Confirmation by the Determinations Panel that the parties must pay would create a legally enforceable debt to the scheme.

However, Titcomb said its decision could still be appealed to the Upper Tribunal.

"The timetable then is completely out of our hands, the Upper Tribunal is part of the courts mechanisms," she said.

On Tuesday Frank Field, the opposition Labour lawmaker who chairs the Work and Pensions Committee, wrote to Titcomb asking what powers she has to seize assets other than cash as part of any enforcement action, prompting media speculation the regulator could go after Green's properties and superyachts.

Titcomb, however, was clear with lawmakers it would be up to the courts to pursue any debt.

A spokesman for Green, whose Arcadia group owns a string of fashion chains including Topshop, declined to comment on Wednesday.

Field has also written to Arcadia's board and the trustees of its pension fund, which is also in deficit, seeking information about its recovery plan. The regulator has also demanded information from Arcadia.

(Editing by Susan Fenton)


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