Sir Philip Green has been labelled the “unacceptable face of capitalism” after BHS, the retailer he sold for £1 last year, collapsed into administration with a £571m hole in its pension fund.
The Arcadia tycoon, who was knighted in 2006 and carried out a review on Government efficiencies for David Cameron in late 2010, came in for fierce criticism from MP’s on both side of the House of Commons.
It came as BHS’s current owner, Retail Acquisitions (RA), the consortium led by former bankrupt and ex-racing car driver Dominic Chappell, faced intense scrutiny for the way it ran the 88-year-old high street stalwart.
It is understood that RA received payments amounting to more than £25m from BHS since it took ownership of the company in March last year. There is no suggestion of wrongdoing, but the payments will receive close examination given the retailer’s collapse because of its lack of funds.
Some 11,000 jobs are under threat after insolvency firm Duff & Phelps was appointed to handle the administration of BHS and its 164 stores, in what is the biggest high street collapse since the demise of Woolworths eight years ago.
Philip Duffy and Benjamin Wiles, the joint administrators, said the retailer would continue to trade as they attempted to sell it as a going concern. It is understood they have already received more than 30 expressions of interest for all or parts of the department store business. BHS staff will be paid on Friday.
The collapse sparked criticism of Sir Philip, who bought BHS for £200m in 2000. During his 15-year ownership of BHS, Sir Philip’s family received more than £400m from the retailer.
The tycoon has offered £80m to help plug BHS’s pension deficit, but the Pensions Regulator has been pressing him to make a larger contribution. BHS’s two retirement schemes have about 20,000 members and are undergoing assessment to enter the Government-backed Pension Protection Fund (PPF), which will lead to many people suffering a cut of at least 10pc to their benefits.
The pension schemes were the focus of a Commons debate on the collapse of BHS tonight, in which Richard Fuller, a Conservative backbencher, described Sir Philip and BHS’s collapse as the “unacceptable face of capitalism.”
Business minister Anna Soubry said the Government hoped a buyer would be found but that if that proves impossible “then the Government will obviously stand ready to offer assistance”.
MPs on both sides of the House expressed serious concerns about the circumstances leading up BHS’s administration.