Defined Benefit  

Field demands answers over Johnston Press pensions

Field demands answers over Johnston Press pensions

Frank Field, chair of the Work and Pensions committee, has written to The Pensions Regulator to request details on its involvement with the Johnston Press defined benefit scheme.

The move follows the announcement the scheme has entered PPF assessment after the sale of the group to JPIMedia.

Johnston Press, publisher of the I and The Scotsman, was acquired by JPIMedia on 17 November after announcing it was seeking a buyer last month.

The sale triggered the PPF assessment period for the DB scheme. An official for the PPF confirmed the move, but declined to comment on a specific date for when the assessment would start.

In his letter to TPR chief executive Lesley Titcomb, Mr Field requests that a detailed description of TPR’s involvement to date with Johnston Press be made available to the committee, with a full explanation of why it was not possible to find a solution that would have avoided the pension scheme entering the PPF.

Schemes enter the PPF when their sponsoring employer is unable to meet their liabilities.

In the case of Johnston Press the scheme, which has 4,959 members and was closed to future accrual on 2010, has a deficit of more than £40m.

But Mr Field believes as the employer was sold on to JPIMedia, a newly-formed company owned by bondholders of Johnston Press, there was no need for this rescue measure.

He wrote: "It is clear from Johnston Press’s annual reports that it has been engaged in active discussions with the Pensions Regulator for some time now. Might I ask you please to provide the committee with a detailed description of the Pensions Regulator’s involvement to date with Johnston Press?

"In particular, it would be helpful to have an explanation of why it was not possible to find a solution that would have avoided the pension scheme entering the PPF.

"It is difficult to understand why it is possible for JPIMedia to acquire the business, no doubt in the expectation of generating a profit from it, but without taking any responsibility for its pension scheme."

A TPR spokesperson said: "Together with the Pension Protection Fund, we will be working with the administrators to understand the circumstances surrounding the sale and its implications for the Johnston Press Pension Plan and its members at this challenging time.

"Our role at this stage is to assess the terms of the sale of the business to ensure the pension scheme has been treated appropriately. We continue to work closely with the scheme trustee and the PPF."

An Urgent Question is expected to be raised in the Commons this afternoon.

Venilia Batista Amorim is a freelance writer for FTAdviser