Connect with us

Hi, what are you looking for?

Editor’s Pick

Green family to pay £50m into Arcadia pension scheme within 10 days

Sir Philip Green’s family is to pay a promised £50m into their fashion empire’s pension scheme within the next 10 days – almost a year earlier than scheduled – as the business secretary, Alok Sharma, called on the insolvency watchdog to investigate the handling of the failed group.

Sharma has asked the insolvency watchdog to examine whether the conduct of directors at Green’s Arcadia Group, which owns a string of high-street brands including Topshop, Dorothy Perkins and Burton, led to problems for the group’s pension fund.

Arcadia fell into administration on Monday, leaving a pension deficit estimated to be as much as £350m.

Last year, Green’s wife, Tina, who lives in Monaco and is the ultimate owner of Arcadia, pledged to pay an extra £100m into the group’s pension scheme over three years and signed over rights to property worth £210m. The pension scheme also has a claim over a debt owed by Topshop to the main Arcadia Group.

Tina Green has so far paid £50m of the promised extra funding. On Wednesday, Arcadia said she would pay the outstanding amount within the next week to 10 days. The final instalment was not due until September 2021.

Despite the additional cash, there are concerns that the pension scheme’s funding will fall short because the pledged property assets are likely to have fallen in value. The Greens are under pressure to deal with Arcadia’s pension deficit as the group is the second major retailer linked to the family to collapse with a scheme in the red.

The department store BHS went into administration in 2016 with a £571m pension deficit only a year after Green sold it for £1 to Dominic Chappell, a former bankrupt. Green eventually paid £353m to support the BHS scheme after pressure from the Pensions Regulator.

The Arcadia deficit is also controversial, as the Green family benefited from a £1.2bn dividend from the company in 2005, as well as more than £300m in interest payments on loans and rents on properties that the family owned.

Sharma called on the Insolvency Service to take a “rigorous” look at the actions of directors at Arcadia. Within three months of being appointed, administrators must provide the regulator with a report on directors’ behaviour. The agency will then consider whether there are grounds for further investigation.

In a letter to Dean Beale, chief executive of the Insolvency Service, Sharma said: “Given the significance of this case and its implications for thousands of suppliers, pensioners and employees, I would be grateful if you would review this report rigorously.

“If you decide that there are grounds for an investigation, I would ask that it looks not only at the conduct of directors immediately prior to and at insolvency, but also whether any action by directors has caused detriment to creditors or to the pension schemes.”

Boris Johnson highlighted Sharma’s action in parliament, adding: “We will be doing everything we can to restore the high streets of this country.”

Arcadia’s pension fund is being assessed for entry to the Pension Protection Fund, the industry-backed lifeboat that pays pensioners of collapsed companies. Under the scheme, members who have not reached normal retirement age before the date their employer goes into administration could lose 10% of their benefits, even if they have already started taking the pension.

Your information is secure and your privacy is protected. By opting in you agree to receive emails from us and our affiliates. Remember that you can opt-out any time, we hate spam too!

Latest

News

Janet L. Yellen said pandemic relief would take priority over tax increases, but corporations and the wealthy, which both benefited from 2017 Republican tax...

Editor’s Pick

HSBC is to close 82 branches in the UK between April and September this year, claiming customers are turning to digital banking. The company...

News

Over the coming decade, the next major problem the world faces after COVID-19 remains climate change, said the World Economic Forum. Image of a...

Editor’s Pick

The government has unveiled details of a £23m fund to support fishing firms as it tries to quell industry anger over Brexit border delays....

Editor’s Pick

Whole groups of people are falling through the cracks of Covid-19 support schemes due to out-of-date tax systems, MPs have said. Some freelancers and...

Editor’s Pick

Productivity increased at its fastest pace in 15 years in the three months to September as the economy bounced back from the first lockdown,...

You May Also Like

When people envision technology overtaking society, many think of The Terminator and bulletproof robots. Or Big Brother in George Orwell’s Nineteen Eighty-Four, a symbol...

Financial Advisors

Stock Markets9 hours ago (Jul 02, 2020 04:45AM ET) (C) Reuters. ROME (Reuters) – World food prices rose in June to post their first...

Economy

SAN FRANCISCO — The spread of the coronavirus has meant feast or famine for technology start-ups. While many are cutting staff and slashing costs...

Economy

In Wisconsin and Ohio, farmers are dumping thousands of gallons of fresh milk into lagoons and manure pits. An Idaho farmer has dug huge...

Disclaimer: Respect Investment.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 Respect Investment. All Rights Reserved.