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Monday 25th
posted by Lamiat Sabin in Britain

MPs condemn ‘king of retail’ who ruined firm

SENIOR MPs have savaged ex-BHS boss Sir Philip Green for running the high street chain into the ground while amassing “a fortune beyond the dreams of avarice.”

A joint report published today by the Commons business and work and pensions committees accuses Mr Green of trying to blame anyone but himself for the firm’s problems, despite systematically taking huge sums out of its coffers while leaving BHS workers’ pension fund desperately short.

MPs said Mr Green has a “moral duty” to make a “large financial contribution” to the 20,000 pensioners at risk of losing a big chunk of their payouts.

The pension fund was in surplus before he bought BHS for £200 million in 2000, the report states, but it suffered as Mr Green’s family was paid huge dividends — more than double the after-tax profits of £208 million between 2002 and 2004.

While MPs fingered Mr Green as the main culprit they also slammed the ex-racing driver he sold BHS to for a quid, Dominic Chappell, and the “directors, advisers and hangers-on” associated with the deal.

This is because Mr Green had refused to plug the “substantial and unsustainable deficit” in the pension fund while his family had accrued “incredible wealth” from the early years of owning BHS while paying little tax.

It was “inconceivable” that Mr Green did not realise Mr Chappell was a highly unsuitable buyer, the report finds.

Mr Chappell is described in the report as being “out of his depth” and “over-optimistic to the point of arrogance.”

The committees accused him of having “had his hands in the till” and paying “lavish” rewards to himself.

But Mr Green had rushed the deal through by ignoring the buyer’s obvious shortcomings and “heavily incentivising” his advisers — making it worth it for them for the deal to go through.

BHS went into administration in April this year, leaving 11,000 workers facing unemployment.

The committee’s report is published just days after the Cabinet Office said it is considering whether Mr Green should be stripped of his knighthood.

Commons work and pensions committee chairman Frank Field said: “One person, and one person alone, is ultimately responsible for the BHS disaster. His reputation as the king of retail lies in the ruins of BHS.

“His family took out of BHS … a fortune beyond the dreams of avarice, and he’s still to make good his boast of ‘fixing’ the pension fund.

“What kind of man is it who can count his fortune in billions but does not know what decent behaviour is?”

Shopworkers’ union Usdaw national officer David Gill said it raises serious questions about how firms are run.

“Sir Philip Green made two promises to BHS staff after the company went into administration,” he said.

“First, to offer employment within the Arcadia Group to the blameless, dedicated and loyal staff who suddenly find themselves unemployed.

“Second, to ‘sort’ the pension scheme and we wait to hear details of what he proposes. We need him to come good on these commitments as soon as possible.”

While MPs branded Mr Green the “unacceptable face of capitalism,” his actions show him to be the “normal face of capitalism,” Communist Party general secretary Robert Griffiths said.

“Capitalism is a system based on the ruthless maximisation of profit, whatever the human cost. He personifies capitalism and deserves to be its poster boy,” said Mr Griffiths.