Trustees of the BHS pensions fund have finally come to a deal that will give 9000 former staff some long-awaited reassurance over their pension payout.
According to The Times, UK specialist insurer the Pensions Insurance Corporation has taken over the scheme, which landed BHS staff in uncertainty when the retailer went into administration over two years ago.
The pensions are now reportedly backed by a regulated insurance company with its own capital, meaning BHS staff could expect their pensions to be paid out in the long term.
The corporation will buy £800 million of pension liabilities in the retail chain’s BHS2 scheme.
The lost pensions were one of the most bitter aspects of BHS’s administration in 2016.
Former owner Sir Philip Green was accused by the Pensions Regulator of offloading the business in order to prevent taking on liability for the pensions.
The regulator demanded Green hand over £363 million to rescue the scheme, after BHS’s demise lead to the loss of 11,000 jobs and a pension deficit of up to £571 million.
Green’s payout last year meant the scheme did not have to enter the Pension Protection Fund (PPF), which would have resulted in an average payout of around 75 percent of the promised pensions.
Around 10,000 of BHS’s 19,000 pension scheme members chose to transfer their pensions to the PPF or take a lump sum payout worth less than £18,000 instead.
Speaking to The Times, chairman of the trustees of the BHS scheme Chris Martin said the deal with the Pension Insurance Corporation was the “best possible outcome” and “most secure solution” for the remaining members.