Sir Philip Green could be asked to pay £280m over BHS pension deficit

Reports last week suggested the Pensions Regulator had been in talks with Green, asking him to contribute to the cost of the pension scheme.

It is now considering asking Green to pay out £280m, 12.5% of his estimated net worth of £3.5bn, according to the Sunday Times. 

Green’s Arcadia Group sold BHS to Retail Acquisitions, a relatively unknown quantity in British retail for £1 last March.

The pensions deficit at the struggling department store stands at £571m. 

This £280m would form the bulk of the £300m sum it would cost the Pension Protection Fund to close the gap, if it is asked to take responsibility for BHS’s pension scheme.

The agreement would see current BHS staff take a pension cut of 10% while pensioners will be kept on the same plan as they are now.

The Pensions Regulator’s plans come at the same time as landlords warning BHS that a CVA may not save it from administration.

If BHS’s CVA is successful, rents in 47 stores would be reduced “to market levels” while rents in another 40 need to be cut “substantially” if the branches are to be viable. 

BHS boss Daren Topp told Retail Week earlier this month: “There’s been a whole raft of actions that have had a positive impact but one of the things we’ve not been able to get traction on is the rents.”

Creditors will vote on the CVA on March 23.

BHS has 171 stores and employs 11,500 people.