MPs kick off probe into BHS fiasco
MPs will turn up the heat on Monday on past and present owners of BHS, including Sir Philip Green, when they begin in-depth inquiries into the collapse of the high street retailer.
The initial focus of the investigations by two powerful select committees will be on the firm's worrying pensions situation.
The defined benefit pension at BHS was running a deficit worth £571m when the retailer was placed into administration last month. Sport Direct's Mike Ashley is thought to have walked away from a last-minute deal to buy the company because he did not want to take on the pensions black hole.
On Monday, representatives from the Pension Protection Fund (PPF) and the Pensions Regulator will appear in front of the Work and Pensions and Business, Innovation and Skills committees.
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They will be grilled on whether pensions regulation is adequate to deal with a situation of the magnitude of BHS, and what impact taking on the retailer's pension scheme will have on the PPF.
It is estimated that the so-called “pensions lifeboat” is likely to face a bill of £250m to £300m to bail out the BHS pension scheme.
Frank Field, chair of the Work and Pensions committee, has said that the purpose of Monday's meeting will be "to test how adequately both organisations have carried out their duties to help protect members’ pensions under the existing law, whether the existing law is inadequate and if so how should it be strengthened".
Malcolm Weir, head of restructuring and insolvency at the PPF, has previously said members of the BHS pension schemes will be protected. However, it is widely thought they could face cuts to their entitlements.
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The string of evidence sessions, some of them joint, will also see current owner Dominic Chappell and former BHS boss Sir Philip Green face tough questions from MPs. Last year, Green sold BHS to a consortium led by Chappell despite him being a three-time bankrupt.
Green, who will give evidence to the MPs in mid-June, paid his family huge sums in dividends during their 15 year ownership of BHS.
Also at Monday's hearing, former City minister Lord Paul Myners will be put forward to join the panel of experts assisting the Work and Pensions committee in their inquiry. He and Green have clashed in the past and tempers have frayed ahead of the hearings, with Green saying he has been subjected to a trial by media.