Pension lifeboat demands BHS liquidation in cost-saving move

The pensions lifeboat that was BHS’s biggest creditor when it collapsed into administration is demanding the company’s imminent liquidation in a bid to accelerate investigations into former directors.

Sky News has learnt that the Pension Protection Fund (PPF), which has taken on responsibility for paying retirement benefits to thousands of former BHS employees, has told the retailer's joint administrators that it wants them to begin liquidating the remaining entities by the end of the month.

The PPF's demand is aimed at speeding up a probe into BHS's former directors and shareholders, including Dominic Chappell, who spearheaded the high street chain's purchase from Sir Philip Green last year.

BHS's subsequent collapse - with the loss of about 11,000 jobs - triggered a political firestorm, with Mr Chappell, Sir Philip and pension regulators all facing intense scrutiny of their conduct.

MPs (BSE: MPSLTD.BO - news) are due to debate the retailer's demise in the House of Commons next week.

BHS was forced to call in administrators at Duff & Phelps in April, with rescue efforts over the next two months proving to be unsuccessful.

The PPF then orchestrated the appointment of FRP Advisory to work alongside Duff & Phelps, with the law firm Jones Day enlisted to help probe transactions involving BHS both before and after Sir Philip sold the company in an ill-fated deal worth just £1 last year.

In a statement issued to Sky News, Malcolm Weir, the PPF's head of restructuring, said: "Given BHS ceased trading in August , we believe that it is appropriate that the company now looks to move from administration into liquidation.

"The co-administrators have already been working towards this point.

"Given it will expedite the investigations and reduce costs, it is therefore in the interests of pension scheme members and our levy payers to do this promptly."

A coruscating report by two committees of MPs concluded that Sir Philip bore much of the responsibility for BHS's travails after opting to sell it to a "manifestly unsuitable" buyer in the shape of Dominic Chappell, a former bankrupt.

Sir Philip remains under pressure to fulfil a commitment to plugging the vast deficit in BHS's pension schemes.

To do so, he will have to write a cheque for several hundred million pounds, although the precise structure of a rescue deal for pensioners is taking months to finalise.

The tycoon, who owns TopShop and other leading high street names, has responded furiously to criticism from the Labour MP Frank Field, accusing him of jeopardising the retirement savings of thousands of BHS pensioners.

During the course of their inquiry, the MPs exposed a web of property transactions involving BHS, Green family companies and other entities, the opacity of which was also criticised in their final report.

The PPF has estimated that the cost to it of meeting BHS pensioners' retirement payments at the discounted level it provides would be at least £275m, although that figure is certain to have risen in the wake of last week's Bank of England rate cut.