 |
| The Pensions Regulator said it would be “fingering the collars” of Carillion bossesJoe Giddens / PA |
The Times
The bosses of Carillion could have to hand millions of pounds of their own money to pensioners of the defunct contractor after the industry regulator said it was investigating whether they should be held personally liable in its collapse.
[post_ads_2]
Under often fiery questions from MPs on the business and work and pensions committees, the Pensions Regulator confirmed that it would be “fingering the collars” of Carillion’s directors and executives as the authorities examine who is responsible for the failed company’s more than £500 million pension deficit.
“Our contribution notice powers can go wider than just looking at corporates: it can look at individuals who are connected and associated with corporates as well. We are looking at all avenues for the use of our powers . . . we have an investigation [afoot],” Nicola Parish, executive director of frontline regulation at the regulator, said.
“If fingering their collar means pursuing an investigation and looking into the activities of all the parties concerned to see what all of the possibilities are for the use of our powers, yes we are. We are gathering information.”
Her admission came after Frank Field, chairman of the work and pensions committee, demanded to know whether the regulator would go “after the boss group [of Carillion], who made so much”.
The payouts to former Carillion managers in the months before the business’s demise have caused outrage. Richard Howson, the former chief executive who stepped down in the autumn, received £1.5 million in salary, bonuses and pension last year. Carillion also agreed to keep paying him a salary of £660,000 and other benefits worth £28,000 until October.
[post_ads]Earlier in the session Lesley Titcomb, chief executive of the Pensions Regulator, faced ridicule from the politicians after she could not say how many corporate pension schemes it currently had concerns about. “If Rachel [Reeves, chairwoman of the business, energy and industrial strategy committee] and I bumped into you at a bus stop we would be expect you to be better informed than you are now,” Mr Field said.
“I can only apologise,” Ms Titcomb replied.
“The fact you are not on top of the detail should send huge shockwaves,” Ms Reeves said.
Carillion’s more than 29,000 former workers are facing cuts to their pensions after the company failed last month, leaving behind a shortfall in its retirement schemes of £567 million. On a worst-case “buyout” basis the cost of honouring the contractor’s pension commitments is estimated at as much as £2.6 billion.
[post_ads]Three weeks ago Robin Ellison, chairman of Carillion’s six biggest defined-benefit schemes, admitted that he had never asked the regulator to use its powers to force the company to hand over more money to its pensioners. “I don’t think there was anything more we could have done,” Mr Ellison said.
Ms Titcomb told today’s hearing that the regulator had lessons to learn from the Carillion debacle. “I think we need to be clearer, quicker and tougher,” she said.
The questioning will increase the pressure on the Pensions Regulator, which was already facing pressure over its role in failing to properly protect BHS pensioners after the retailer fell into administration in 2016 after its sale a year earlier by Sir Philip Green for £1 to Dominic Chappell, a thrice-bankrupt former racing driver.
“If we close our eyes we could be talking about BHS . . . where is the learning going on,” Mr Field said.
Tags
Business