// Aviva is close to finalising a £1bn deal with Arcadia that will guarantee retirement payouts to thousands of former Topshop, Burton and Dorothy Perkins employees
// If agreed, it would bring to an end negotiations about one of the UK’s most controversial corporate pension schemes
Thousands of pensioners left facing an uncertain retirement following the collapse of Sir Philip Green’s Arcadia empire are close to securing a funding deal backed by Aviva.
Sky News reported that the trustees of the Arcadia Group pension scheme are close to striking a binding deal with the FTSE 100 insurer to guarantee its members’ pay.
City sources told Sky a formal agreement was likely within weeks, with Aviva understood to have seen off competition from rival insurance companies, including Pension Insurance Corporation.
If successful, it would bring to an end negotiations about one of the UK’s most controversial corporate pension schemes.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
The fate of Arcadia’s pensioners, comprising of popular brands including Topshop/Topman Burton and Dorothy Perkins, has been in the balance since Green was forced to put the group into administration back in 2020 – putting 13,000 jobs at risk at the time.
The group said the impact of the Covid-19 pandemic, including the forced closure of its stores for prolonged periods, had “severely impacted trading across” all of its brands.
While details on the structure of the deal between the Arcadia trustees and Aviva is unclear at this time, one insider told Sky it was expected to involve members receiving full benefits – albeit potentially with more limited future increases than current inflation levels would justify.
Arcadia members are certain to receive superior payouts to those they would have recieved through the Pension Protection Fund lifeboat, which effectively guarantees benefits worth 90% of pension pots to unretired members.
The last public figure for Arcadia’s pension liabilities was in the order of £1bn, although the current figure was unclear.
Click here to sign up to Retail Gazette‘s free daily email newsletter
