Tycoon Philip Green accrued ‘cash beyond the dreams of avarice’

In Britain the influential lead work and pensions committee chairman Frank Field has delivered a broadside against former British Home Stores boss and multimillionaire Sir Philip Green.

The businessman is chairman of the profitable Arcadia Group, a retail company that includes Topshop, Topman and myriad lucrative labels, but is facing mounting pressure to be stripped of his knighthood and to rectify the black hole in the BHS pension fund after an excoriating joint report by two House of Commons select committees.

Field said Green is “much worse” than media mogul Robert Maxwell, who raided the pension pot of the Mirror Group newspaper business.

He also described the businessman as a “Napoleon figure” floating around on his yacht, having “orchestrated” an “old-fashioned classical asset-stripping” which has put the jobs of 11,000 BHS workers at risk and left 22,000 pensioners with a risky future.

‘Incredible wealth’

The report – among the most scathing ever issued by a commons committee – comes just days after the cabinet office disclosed that it was reviewing Green’s knighthood.

It said that although his family had accrued “incredible wealth” from their early, profitable years of owning BHS – while paying little in tax – Green had failed to invest in the company and refused to address the “substantial and unsustainable deficit” in the pension fund.

The committees said it was “inconceivable” that the businessman had not realised Dominic Chappell, a former bankrupt with no retail experience, was a “manifestly unsuitable” buyer and that he had “acted to conceal the true state of the BHS pension problem” from him.

Field, co-chairman of the inquiry, told the BBC Radio 4 Today programme: “[Green’s] much worse. I never thought Maxwell . . . he was just borrowing money all over the place.

“This person has plundered BHS and Arcadia. The Arcadia group of companies – their pension scheme is now also in deficit.

“Money beyond the dreams of avarice have gone up to the Green family and 11,000 workers are now going to hit the dole queues; 22,000 pensioners are actually suffering cuts. I think that is worse because he has it in his power to do things. Maxwell didn’t have it in his power. The music stopped while there was no money there.”

Pension surplus

When Green acquired BHS in 2000 for £200 million, the report said the company pension schemes were in surplus, but the high level of dividends paid out – more than double the after-tax profits of £208 million between 2002-04 – had left it weakened.

Although he had been aware of the growing problem with the pension fund, he had resisted calls to deal with it, primarily because he did not want to reveal details of his past business dealings to the British pensions regulator.

Faced with consistent losses, Green struggled to find a buyer for the company – in part because of the hole in the pension fund. Having rejected Paul Sutton – “a fraudster and a bankrupt” – he settled on his junior business associate, Mr Chappell.

In order to push the deal through, the committee said that regulatory concerns had been “circumvented”, advisers were “heavily incentivised” to make progress while background checks proved “inadequate”.

The deal was completed on March 11th, 2015, and 13 months later, on April 26th, 2016, BHS went into administration leaving 11,000 employees facing an uncertain future.

Mr Chappell, described in the report as being “out of his depth” and “over-optimistic to the point of arrogance”, was accused by the committees of having “had his hands in the till”, paying “lavish” rewards to himself and his associates while the company foundered.

The committees were scathing about the way the participants had each sought to blame each other, saying that at times their inquiry had resembled a “circular firing squad” with Green the “worst example”.