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BHS - what a shambles

(17 Posts)
Gasp0deTheW0nderD0g Wed 08-Jun-16 18:13:14

I was just listening to the BBC news reports about the testimony given to the select committee today. Astounding. Why isn't there effective scrutiny when a big employer is sold off, to protect the workers? Wasn't there any due diligence on behalf of the staff, given that there are thousands of them and also a large number of pensioners, all depending on BHS for their income? Silly question, of course. Neither Labour nor the Tories has had any inclination to stand up to the city and defend the rights of employees. sad angry

cdtaylornats Wed 08-Jun-16 18:42:02

So if company X is going bust and someone wants to buy it but due diligence says they can't buy it and the business crashes how does that help?

Gasp0deTheW0nderD0g Wed 08-Jun-16 18:55:03

In this case, the somebody would appear to have had very little relevant experience. The evidence to the Select Committee today suggests that he was more interested in the property than the retail business. He had no realistic chance of getting that business back on its feet. In the period he owned it, if I understand correctly, its financial position got worse. If the business was doomed anyway, it would have been better for the staff, the pensioners and the UK taxpayer if it had gone bust when Philip Green decided to walk away. That's what I'm speculating about.

cdtaylornats Wed 08-Jun-16 21:17:31

it would have been better for the staff, the pensioners and the UK taxpayer if it had gone bust when Philip Green decided to walk away

Care to explain why you believe that?

QuiteLikely5 Wed 08-Jun-16 21:20:44

Yes but he is a businessman and his business was failing so he sold it - and passed the responsibility of that business to someone else

I agree it's morally wrong but is there moral consideration when you are taking millions of pounds?

Gasp0deTheW0nderD0g Wed 08-Jun-16 22:06:01

I just said why I believe that. Because there was more money in the business when Philip Green sold it than there is now, hence more in the pension pot and more available for redundancies.

It would be nice to believe that a mega-rich entrepreneur would think about the moral considerations, but I don't believe they can be relied on to do that, which is why in my OP I was saying there should be stricter legal controls in these circumstances.

Asprilla11 Wed 08-Jun-16 22:25:55

These Parliamentary Committees are interesting but a total waste of time. The questions are usually poor with only maybe 2-3 out of 8-9 MPs actually asking good questions and following up on points properly.

I'm not usually one for saying the USA does things better than us but in this case they do. They can order evidence to presented and also bring criminal charges if it is found that criminal activity has taken place.

I know we have Public Enquiries but they are quite rare and costly, giving the Parliamentary Committees some powers would at least give these inquiries some teeth.

cdtaylornats Wed 08-Jun-16 22:30:20

There would have been less in the pension pot as they would have missed out on the amount they got between the sale and the redundancy. No money was removed from the pension pot.

Of course there was more money in the business. There was more money when Green bought it - but it was making a loss, for each day it traded there was less.

ceeveebee Wed 08-Jun-16 22:37:57

There was a lot more money in the business when Philip Green bought it. He stripped every penny out, failed to fund the pension properly and then sold it for nothing.

The pension protection fund has no real powers to prevent the sale of a business, it is a reactive body that picks up the pieces. It needs to be strengthened so that businesses cannot be sold if they have a large pension deficit without putting a plan in place to fund it. And there should be changes to company law to prevent dividends being paid if a company has a pension deficit (or at least, not unless there is a proper plan to clear it)

BeJayKayven Wed 08-Jun-16 22:43:18

Im sure the billionaire Philip Green is sorry that all the loyal shop workers have lost their jobs and perhaps pensions. Maybe he will sell one if his multi million pound yachts to help out. Pigs will fly.

ceeveebee Wed 08-Jun-16 22:52:20

This article is interesting reading

"When Green bought BHS in May 2000, the group’s [pension] fund was in surplus"

"Between 2002 and 2004, shareholders extracted just over £422m in dividends – the vast majority of which went to Green’s family"

FarAwayHills Thu 09-Jun-16 17:21:09

Stripping a company of funds to line your own pockets, leaving it in financial ruin and selling it on for £1 is dispicable. Selling it on to someone who does exactly the same is even worse. The whole thing stinks and I doubt for one minute that those responsible will ever be held to account in a meaningful way.

Turbinaria Thu 09-Jun-16 21:00:43

Lord Myners said when Phillip Green expressed interest in buying M&S he demanded access to their pension scheme. Luckily for M&S he was shown the door

Turbinaria Thu 09-Jun-16 21:04:13

I for one think he should be stripped off his knighthood Unless he does right by the BHS pension scheme. I'm sure he prizes that above mere money

Penfold007 Thu 09-Jun-16 21:46:51

I don't understand what any of the BHS shambles has to do with a parliamentary select committee. If fraud is suspected then there are appropriate authorities to deal with it. I suspect fraud has occurred but a PAS isn't going to sort it.

ItsAllGoingToBeFine Thu 09-Jun-16 21:49:23

I doubt there was any fraud - I'm sure it was all above board, just exploiting one of the many loop holes that the moneyed employ. Perks of living in a capitalist society. The people don't matter, just the money.

ceeveebee Thu 09-Jun-16 23:27:28

It will have all been legal - he will have lawyers crawling all over it. But just because legally right doesn't make it morally right. Just like Starbucks et al avoid paying tax without breaking the law. So the law will no doubt change, and the lawyers will have to find new ways to get round it

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