Philip Green in new BHS pension delay

BHS pensioners are facing a protracted wait over the future of their payments as it emerged that it will take “months” for Sir Philip Green to broker a deal. It comes as 10,000 workers face unemployment after the last 22 BHS stores closed their shutters yesterday.

BHS pensioners are facing a protracted wait over the future of their payments, as it will take “months” for Sir Philip Green to broker a deal to plug the retailer’s pension black hole, it has emerged.

The news comes as 10,000 workers face unemployment after the last 22 BHS stores closed their shutters yesterday, marking the end for one of the high street’s most enduring names.

Sir Philip promised MPs more than two months ago that he would “sort” BHS’s pension deficit after the collapse of the retail chain left a £571m gaping hole. The deficit has since swollen to about £700m due to the fall in sterling and the Bank of England’s interest rate cut.

However, it is unlikely that the billionaire will have to pay even half that amount as he is negotiating a deal that would transfer his money directly to BHS pensioners, rather than the Pension Protection Fund.

Under the mooted proposal, dubbed “Project Atlantic” by advisers at Deloitte, thousands of shortterm former workers would be offered lump sums of up to £15,000 while a separate scheme would be set up to fund the future payments to longer-serving employees.

Sir Philip wants the Pensions Regulator to drop its anti-avoidance investigation into his ownership before he settles a deal that would be the first voluntary contribution of its kind. But, industry sources said that while “it was an obvious desire” of the billionaire, now holidaying on his £100m yacht around the Greek Islands, “there was no standard practice” to suggest the watchdog would agree to such demands.

The Pensions Regulator expects to have made progress with its probe by the end of the year. As a result it is unwilling to enter into deals until it has come to a conclusion whether the Topshop owner tried to avoid his pension responsibilities. By the same token, Sir Philip is unwilling to make a contribution whilst the threat of further demands loom over him, an ally of his said. It will take “months”, they said.

Sir Philip’s advisers are presenting his proposal as a swifter solution for BHS pensioners than an attempt to recover money through the pensions regulator’s “contribution enforcement” process – whereby it demands money to cover the deficit.