Bernard Matthews new focus of pensions probe
THE takeover of turkey farm group Bernard Matthews will be the latest focus of a probe by MPs this week, after the Pensions Regulator complained of being powerless to protect workers’ pensions put at risk by the deal.
The investigation is set to scrutinise ‘pre-pack’ administration deals, which can allow a company to keep trading while leaving creditors, including its pension fund, out of pocket.
The latest focus of the investigation comes after the regulator, Lesley Titcomb, wrote to the Work & Pensions Committee of MPs saying she had been frozen out of the deal to rescue Bernard Matthews.
The firm was taken over last month by Boparan Holding, owned by food manufacturing billionaire Ranjit Boparan, in a pre-pack administration deal. Such deals allow the sale of assets to be arranged in advance of a company going into administration. Creditors can then be left unpaid.
The Bernard Matthews pension liabilities are now part of the Pension Protection Fund, meaning hundreds of staff face cuts of up to ten per cent in their retirement income.
In a letter to committee chairman Frank Field, Titcomb said her organisation had been in talks with the company over a deal to shore up its troubled pension scheme as far back as 2007. Despite that, the body had been kept out of any involvement in the takeover.
‘We were not approached by the pre-administration lenders, shareholders or by the purchaser seeking clearance for the sale,’ she wrote.
It is understood the scheme has a shortfall of about £16million. The case is set to draw comparisons with stores group BHS, which closed with a £571million hole in its fund.
The inquiry into Britain’s pensions laws, led by Field, begins on Wednesday.