Business

Javid orders BHS probe as Green agrees to meet MPs

Sir Philip Green Image copyright Getty Images
Image caption Sir Philip Green sold BHS last year

Business Secretary Sajid Javid has ordered the Insolvency Service to investigate the collapse of UK department store BHS.

It comes as former owner Sir Philip Green agreed to appear before two Commons committees to answer questions about the collapse.

Sir Philip sold BHS to Retail Acquisitions last year for £1, but has faced criticism about his role.

BHS went into administration last month, threatening thousands of jobs.

Mr Javid said in a statement: "I have asked the Insolvency Service to bring forward its investigation rather than wait three months for the administrators to report before launching their inquiry.

"This investigation will look at the conduct of the directors at the time of insolvency and any individuals who were previously directors. Any issues of misconduct will be taken very seriously."

Sir Philip bought BHS in 2000 for £200m, but sold the department store last year.

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At the time, there were questions over the lack of retail experience of Dominic Chappell and his team at Retail Acquisitions, which became the majority shareholder of the department store.

A fortnight ago, the business fell into administration with debts of £1.3bn - including a pension deficit of £571m - putting 11,000 jobs at risk across 164 stores nationwide.

Sir Philip is believed to have offered to provide about £80m to help plug the pension deficit. But he has already faced accusations that he crashed BHS "into a cliff", from the chairman of the Business Innovation and Skills Committee, Iain Wright.

Questions

Meanwhile, Frank Field, chairman of the Work and Pensions Committee, said Sir Philip had contacted Parliament and "indicated his willingness to come to Parliament to give oral evidence" to a joint session of the Work and Pensions select committee and the Business, Innovation and Skills committee.

No date had yet been set for his appearance. There were suggestions that the committees also wanted to quiz Sir Philip's wife, Lady Green. But Mr Field said he believed Sir Philip "will be able to answer all of our questions on the operations of BHS's pension fund".

Image copyright Getty Images

Ahead of Sir Philip's appearance, the Work and Pensions Committee is due to hear from the Pensions Regulator and the Pension Protection Fund, BHS Pension Trustees, and Mr Chappell.

There is no suggestion that Sir Philip did anything illegal.

However, on Friday, the former chairman of Marks and Spencer, Lord Myners, told the BBC Sir Philip had big questions to answer over his stewardship of BHS.

Lord Myners said: "The big question is whether when Philip Green sold BHS to a group of individuals with no retail experience, led by a former mini racing car driver and twice bankrupt person... that the pension scheme had enough assets to meet its liabilities."

He added: "It is the responsibility of the owner to either make sure that the pension fund is adequately funded or that the new owner is going to take on that responsibility and is a fit and proper person with adequate funding and sensible plans to ensure that the deficit will be covered."

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