Independent Labour MP Frank Field has promised to look carefully at the pension deal made by Arcadia with the UK pension authorities, as the vote on the ailing retailer’s restructuring plan has been delayed by a week.
Mr Field, chairman of the Work and Pensions select committee, said the next week would give Sir Philip Green time to try and agree a deal that lets him off the hook, for both "immediate responsibility for the dire state of Arcadia", and the "full brunt of the pension scheme’s mega deficit".
He added: "We will use this time to look even more carefully at the adequacy of the Arcadia pensions deal that The Pensions Regulator is satisfied with, despite it apparently leaving a deficit in the pension scheme for years to come."
Following discussions with the Pension Protection Fund and TPR, Arcadia agreed to provide an extra £25m to its pensions schemes, bringing the additional security up to £210m.
Yesterday (June 5) the PPF stated it would vote in favour of the company voluntary arrangement Arcadia proposed, which will see the closure of 23 of its 566 stores in the UK and Ireland, and the loss of 520 jobs.
But some of the CVAs, which were scheduled to be voted on yesterday, have been adjourned to June 12, so that Arcadia can confer with a few of its properties' landlords, with a view to securing a final decision on the restructuring plan.
A PPF spokesperson said: "As Arcadia confirmed earlier there is now a seven-day adjournment on their CVA proposal.
"We voted in favour of the Arcadia Group Limited CVA as we believed the funding and security package agreed was a good outcome for members of the pension schemes and the PPF.
"We still believe this to be the case and hope that this extra time will allow the company and the parties concerned to reach mutual agreement.
"We recognise that this continues to be a worrying time for members of the Arcadia pension schemes and they can be reassured that the PPF is here to protect them whatever the outcome of the CVA vote."
The ailing retailer has two final salary plans with a combined deficit in 2018 of £537m on technical provisions, or £727m on a buy-out basis (the amount needed for an insurer to take on the liabilities).
As part of the CVA, the retailer is proposing to decrease the annual contributions made to the schemes from £50m to £25m, for three years, "with security over certain assets being granted in order to provide support to the schemes".
Lady Green - Sir Philip Green’s wife and the ultimate owner of Arcadia — has offered to bridge the shortfall with funding of £25m per year for the next three years, plus an additional £25m contribution, resulting in total payments of £100m.
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