LONDON – Sir Philip Green said he has not broken the law, and has “no legal liability” to make any payment to support the pension scheme of his former retail holding BHS, whose demise was the subject of a high-profile inquiry by a joint British parliamentary committee.
Over the weekend, yet another war of words erupted between Green and Frank Field, the British parliamentarian who led the inquiry, and who is demanding that Green personally plug the BHS pension gap, which swelled to 571 million pounds, or $755 million, under the retail tycoon’s ownership.
Parliament’s Work and Pensions, and Business, Innovation and Skills committees published a report last week following the investigation, calling the BHS affair the “unacceptable face of capitalism,” and castigating Green for his management of BHS, for the pension fund hole, and for the sale of the retailer to Dominic Chappell, a man with no retail experience.
“Much as you would love to, you cannot point to any rules or laws that I have broken. Because I have broken none. You hide behind parliamentary privilege by publicly traducing me and my family in select committee hearings with allegations of theft,” Green wrote in a letter to Field late Saturday.
The letter came in reaction to an interview Field gave to the Times of London in which he asked once again that Green plug the gap – and more. He now wants Green to write a check for 700 million pounds, or $926 million, to cover the shortfall, although he did not clarify why the figure is now bigger.
“I thought he would actually do the decent thing,” Field told The Times. “I couldn’t believe somebody so rich, who could have acted so quickly and walked away smelling of roses, didn’t do so.” Field also wants Britain’s Serious Fraud Office to launch a formal inquiry into the sale and purchase of BHS.
The BHS issue – both the collapse of the company and its pension scheme – is an ethical one, and there have been no charges filed and no allegations of illegality. Some 11,000 jobs were lost when BHS fell into administration and 22,000 pensioners could potentially see much smaller payouts due to the shortfall.
Green has apologized publicly for the BHS fiasco and maintains he is working on finding a solution to the pension fund.
In his letter, Green said there is a detailed process, legislated for by the British Parliament, around defined benefit pension schemes. “Your repeated attempts to lead the public into thinking that it is simply a matter of me writing a cheque are utterly disingenuous. The Pensions Regulator has its own processes that we are obliged to follow.”
Green added that he has continued to engage with Britain’s pensions regulator before and after the sale of BHS, and has cooperated fully with their processes. “Recently, real progress has been made” with the regulator with regard to BHS.
“But you should be in no doubt, Mr. Field, that any solution relies on a voluntary decision on our side to support the BHS pension schemes. There is no legal liability to make any payment to support the schemes. Indeed, I am unaware of any precedent for any private company or individual doing so,” Green wrote.
“We want to help the BHS pensioners. I will not be bullied by your press campaign and political grandstanding into supporting the BHS pension schemes. If you continue to seek to usurp the pension regulator’s role with your characteristically unfathomable statements, and hurl daily abuse at us, any failure to arrive at a pensions solution will be down to you. The BHS pensioners can only hope that you now reign yourself in.”
On Sunday morning, Field told BBC TV that Green could be asked to appear once again before parliament over the BHS affair, and that Field planned to meet the pensions regulator to discuss Green’s claims about finding a solution to the pension shortfall.