Fascinating

According to accounts just filed at Companies House, BHS saw its pension scheme deficit rise to £139m for the year ended 30 August, from £136.6m the year before. After a £27.8m tax credit, the net deficit was £111.1m, up from £109.3m.

The pensions deficit is one of the biggest challenges facing Retail Acquisitions, which is backed by a number of investors including brokers and lawyers. Its largest shareholder – Dominic Chappell – has a chequered CV that includes bankruptcy.

Mr Ralfe warned that it would be tough for Retail Acquisitions to trim the deficit. He believes that, as at March 2015, the underlying deficit could have sunk a further £20m into the red.

He told The Independent: “The £139m pre-tax deficit at August 2014 would likely have risen to at least £160m by March – a higher value of assets will be more than offset by a higher value of pension liabilities, as long-term interest rates fall to new lows.

Not all of that £700 million is really Sir Philip’s problem, is it?

And it feels really, really, weird to be, so far as I’ve seen at least, the only person making this simple point.

What confuses me more though is, well, why isn’t Green himself telling everyone this?

10 thoughts on “Fascinating”

  1. “What confuses me more though is, well, why isn’t Green himself telling everyone this?”

    Because no-one wants to listen, do they? If I were him, I’d be sitting with a good libel lawyer close at hand waiting for someone (or some entity) to stray just too close to the wind. Then sue the f**k out of them. Then he’s got a court decision to validate him & everyone else will be scared sh1tless to go anywhere near the subject.

  2. Maybe he hasn’t realised it himself.

    Green: “Why is our pension deficit so big?”
    Beancounter: “Well, interest rates and market volatility…”
    Green: “Just give me the simple answer!”
    Beancounter: “Because we didn’t put enough money into it.”

    A lie can travel halfway round the world before the truth gets its shoes on.

  3. Given the total detachment from truth of the hit-pieces aimed at Green, I think he’s wise to hunker down and say as little as possible. If he made some kind of statement on the subject, the same people currently wielding the rhetorical pitchforks would write about how ‘Green says pension deficit is not his responsibility’ or some such twisted nonsense.

  4. Dave – which would be true. From their perspective.
    A wise man can let his enemies speak as they wish while knowing the truth will out.
    Imagine the fun if parliament was convinced to enact a law to get what they have been told and make it retroactive. Then find the courts chuck out the case as incorrect!

    Parliament has been convinced multiple times to create legislation based on what they perceive as the issue. Resulting in lots of other people having problems but not in any way applicable to the person they were out to get.
    One of my cases in the civil service was like that, rabid campaigners used the case to get additional enforcement measures put in place. Except the enforcement never applied to him – it couldn’t.

  5. “why isn’t Green himself telling everyone this?”

    Because of his dedication to intellectual consistency. When one of his (her!) companies makes money, everything is due to his genius. So he can hardly blame interest rates and longevity when one of his (!) pension funds is in the soup, can he?

    Or maybe he’s just an impossible arrogant bastard who wouldn’t demean himself by making logical arguments?

  6. @Tim W
    “Not all of that £700 million is really Sir Philip’s problem, is it?

    And it feels really, really, weird to be, so far as I’ve seen at least, the only person making this simple point.”

    I discussed it with my seventy something mother and she already knew why the falling base rate exacerbates DB pension schemes’ problems.

    We’re not all brain dead reality TV remainians.

    “What confuses me more though is, well, why isn’t Green himself telling everyone this?”

    Maybe he has and the MSM which is in full on “hang Green” mode has ignored it?

  7. Either he doesn’t know (I find this implausible), he doesn’t care (possible, but why make some noises about making the pension good?) or he doesn’t think the point will actually be understood (probably).

    Or, possibly, he is quite tied up with the mechanics of the Chappell acquisition somehow. He clearly wanted it off his hands as there were, I believe, some asset leaseback contortions to make it possible for someone with little capital to do it.

    But your basic point – that the press in general (and possibly some esteemed parliamentarians) just don’t have a clue about some basic financial facts – is correct. The lack of real reporting has saddened me.

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