Conservatives talk tough over 'Philip Green law'

In one of several measures that marks an unusually interventionist stance, the Conservatives have pledged a tough new law to protect company pensions.

The party now faces criticism that the policy is a populist reaction that lacks detail.

The proposal would mean "company bosses who 'deliberately or recklessly' risk the ability of a pension scheme to meet its obligations could be charged with a criminal offence," says the Daily Telegraph.

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Under the manifesto, fresh powers would be handed to the Pensions Regulator to issue fines to directors deemed to be in breach of obligations to pensioners.

Experts say the Tory proposal is a direct response to the scandal caused by the collapse of BHS, whose former owner Sir Philip Green was accused of stripping hundreds of millions of pounds from the company while overseeing its demise.

Green owned the company for ten years and made a good chunk of his fortune from the business, but by the time it was sold in 2015 it was in dire straits.

BHS collapsed into administration a year later and was eventually liquidated. It took almost another year to strike a deal with Green to inject £363m into its pension scheme to prevent payouts from being cut.

Business leaders and pensions experts are sceptical about the proposed measures.

"Sceptics will call it the 'Philip Green Law'," says Samantha Brown, a pensions partner at law firm Herbert Smith Freehills. "It is unlikely to be welcomed by businesses or scheme trustees and [will] be seen as reactive."

Hugh Nolan, president of the Society of Pension Professionals, added: "Reckless is an ill-defined term – does that mean investing in the equity markets [is reckless] if the market then crashes?"

Former pensions minister Steve Webb says the move is "symbolic legislation". He added: "I wonder if it's trying to sound tough but when they write the law they will struggle to implement [it]."

Labour proposed its own Philip Green law last year, says Politics Home, but that would have focused on amending the takeover code to stop directors loading debts onto a company that could cause it to fail.

In its own manifesto, Labour is proposing to amend the takeover code to ensure acquiring companies have a plan in place to support existing pension schemes, but does not introduce any criminal offences.