Yahoo News Sir Philip Green told to fund Arcadia's 'worrying' pension deficit with his own money
![Sir Philip Green’s embattled retail empire Arcadia is set to close twice as many stores as it was initially announced earlier this week, it has emerged.The group, which includes brands such as Topshop and Dorothy Perkins, had said 23 shops were to shut across the country as part of a plan to rescue the struggling business.But it now appears that a further 25 stores will also go – with the brunt being borne by plus size clothing chain Evans and fashion outlet Miss Selfridge.The extra closures are detailed in the small print of a company voluntary arrangement, an insolvency procedure which Sir Philip hopes to use to cut staff, slash rents and reduce the company pension pot in a bid to save the wider group from collapse.“Due to the intensely competitive environment, [Evans and Miss Selfridge] will reduce their retail store portfolio significantly in the short term,” the agreement proposal says, while also adding that Sir Philip would be willing to consider selling parts – or even all – of the business.Arcadia currently has more than 560 stores across the UK and Ireland and employs some 22,000 people.Under the proposed restructuring announced earlier this week, it would shut 23 stores and reduce the company's contribution to the pension fund by £50m a year.Ian Grabiner, the group’s chief executive, said the action was "tough but necessary”.But before the plans can be put in place, they must be approved by landlords, creditors and the company's pension trustees.On Friday, MP Frank Field, chair of the Work and Pensions Committee, wrote to Sir Philip suggesting he had a moral obligation to use his own money – much of which he has extracted from Arcadia – to support the pension fund.The new blow is just the latest in a series of calamities for the 67-year-old tycoon, who was reported as no longer being a billionaire in March.Last year he was embroiled in claims – strongly denied – of racist and sexist bullying and harassment towards staff.Before that, he was criticised in parliament over the demise of department store BHS, which collapsed leaving a huge pension deficit a year after he sold the business for a pound.](https://s.yimg.com/ny/api/res/1.2/PJCRBhjNS86wMVEjwJn.hA--/YXBwaWQ9aGlnaGxhbmRlcjt3PTk2MDtoPTY0OQ--/https://media.zenfs.com/en/the_independent_577/aeb0895d9df3485c2e4b927db0723100)
![Sir Philip Green’s embattled retail empire Arcadia is set to close twice as many stores as it was initially announced earlier this week, it has emerged.The group, which includes brands such as Topshop and Dorothy Perkins, had said 23 shops were to shut across the country as part of a plan to rescue the struggling business.But it now appears that a further 25 stores will also go – with the brunt being borne by plus size clothing chain Evans and fashion outlet Miss Selfridge.The extra closures are detailed in the small print of a company voluntary arrangement, an insolvency procedure which Sir Philip hopes to use to cut staff, slash rents and reduce the company pension pot in a bid to save the wider group from collapse.“Due to the intensely competitive environment, [Evans and Miss Selfridge] will reduce their retail store portfolio significantly in the short term,” the agreement proposal says, while also adding that Sir Philip would be willing to consider selling parts – or even all – of the business.Arcadia currently has more than 560 stores across the UK and Ireland and employs some 22,000 people.Under the proposed restructuring announced earlier this week, it would shut 23 stores and reduce the company's contribution to the pension fund by £50m a year.Ian Grabiner, the group’s chief executive, said the action was "tough but necessary”.But before the plans can be put in place, they must be approved by landlords, creditors and the company's pension trustees.On Friday, MP Frank Field, chair of the Work and Pensions Committee, wrote to Sir Philip suggesting he had a moral obligation to use his own money – much of which he has extracted from Arcadia – to support the pension fund.The new blow is just the latest in a series of calamities for the 67-year-old tycoon, who was reported as no longer being a billionaire in March.Last year he was embroiled in claims – strongly denied – of racist and sexist bullying and harassment towards staff.Before that, he was criticised in parliament over the demise of department store BHS, which collapsed leaving a huge pension deficit a year after he sold the business for a pound.](https://s.yimg.com/ny/api/res/1.2/q1X0_bKctPsIvf3TlwTUDw--/YXBwaWQ9aGlnaGxhbmRlcjt3PTk2MDtoPTY0OA--/https://media.zenfs.com/en/the_independent_577/d56776fe290b068f37f20ae1b32ec586)
Sir Philip Green has been told to use his own money to fund the pension scheme for his embattled retail empire.
MP Frank Field, chair of the Work and Pensions Committee, wrote to Sir Phillip asking him to replicate the funding he provided when a “similarly grim situation arose for BHS pension scheme members”.
Sir Philip’s Arcadia group, which includes Topshop, Burton and Miss Selfridge, Arcadia announced this week that 23 stores would close putting 500 jobs on the line as part of a plan to overhaul its business and boost its flagging profits.
Under the plans, Arcadia will halve contributions to its pension scheme from £50m to £25m as it attempts to narrow a “worrying” deficit.
Mr Field said it was “disappointing” to see the proposals include a reduction of contributions.
Under the plans, Sir Philip’s wife Tina Green who is Arcadia’s main shareholder will contribute £25m per year for the next three years plus a one-off payment of £25m.
Mr Field welcomed the proposal for personal contributions to reduce the scheme’s “worrying” deficit, but he warned “this is not sufficient to ensure adequate protection for scheme members”.
The MP said: “It was disappointing to to see the proposals that contributions to reduce the deficit will be halved as part of the financial restructuring.”
Mr Field’s letter notes that Sir Philip only stepped in to fund the BHS pension scheme after regulators became involved.
The MP asked Sir Philip to “offer a guarantee to Arcadia staff that you would do the same for them should the deficit reduction plan prove insufficient - and this time, without the need for the Regulator of Parliament to step in first?“
Sir Philip has previously faced fierce criticism from politicians including Mr Field for his handling of BHS's sale and subsequent collapse.
He eventually paid out £363m of his personal wealth to help shore up the group's pension deficit.
The retail tycoon’s fortune is estimated to have been halved to £950m in the past year as Arcadia.
Sir Philip and his wife Tina had wealth valued at £4.7bn in 2007 but the compilers of the Sunday Times Rich list said the Arcadia group on which much of their fortune is based is now “worthless” because of its huge debts. The group has also failed to keep up with changing trends and shopping habits.
