The Pensions Regulator has begun enforcement action against former BHS owner Sir Philip Green to seek redress for the 20,000 pension scheme members.

It has sent warning notices with statements of its case to Green and Taveta Investments Limited and Taveta Investments (No.2) Limited – the Green family’s investment vehicles.

In addition, it has also sent a warning notice to Dominic Chappell and Retail Acquisitions Limited, who infamously bought BHS off Green for £1 in 2015. However, the regulator said that the warning notices issued to Chappell and Retail Acquisitions are different to those issued to Green and Taveta Investments.

It said each notice is over 300 pages long, and sets out the arguments and evidence as to why TPR believes the respondent should be liable to support the BHS pension schemes, following the sale of the business in March 2015 and its subsequent insolvency.

The notices set out evidence to support the use of both TPR’s contribution notice (CN) and financial support direction (FSD) powers. A CN demands a specified sum of money, and an FSD requires respondents to put ongoing support in place for a pension scheme, which must first be agreed with TPR.

The regulator first initiated an anti-avoidance investigation in relation to BHS in March 2015. Since then, a complex investigation has been in progress including demands for access to, and subsequent review of, almost 100,000 documents, as well as meetings and negotiations with various parties and stakeholders.

During an inquiry by the Work and Pensions Committee, which concluded that Green was responsible for the BHS pension deficit, estimated to be around £571m, he said he would “sort it”. Since then he has not handed over any money for the pension scheme. However, he said that “contrary to coverage” he is worked to resolve the BHS pension crisis on a “daily basis”.

Commenting on the decision, chief executive Lesley Titcomb said: “We have been clear in our public commitment to make significant progress by the end of 2016 and the issue of these notices meets that commitment.

“Our decision to launch enforcement action is an important milestone in our work to attain redress for the thousands of members of BHS schemes who have been placed in this position through no fault of their own.

“Issuing warning notices at this time reflects the outcome of our investigations and that we are yet to receive a sufficiently credible and comprehensive offer in respect of the BHS schemes. We continue to pursue the best deal for members of the BHS pension schemes. If parties wish to approach us with settlement offers, that course remains open to them.”

Those who have received warning notices now have a specified period of time to respond with their comments and representations in relation to the warning notice.

TPR’s case teams will then consider these before the case can be passed to TPR’s Determinations Panel, which operates at arm’s length from TPR’s case teams and decides on the exercise of some of TPR’s most significant powers, including CNs and FSDs.

The Pensions and Lifetime Savings Association director of external affairs Graham Vidler said the regulator is “doing the right thing” by exercising its powers to begin enforcement action but “despite the regulator’s best efforts this is unlikely to result in a quick resolution”.

“This whole situation could be resolved very quickly, and save a huge amount of time and cost, if Sir Philip voluntarily makes a payment that the regulator deems acceptable,” he added.

In addition, former Pensions Minister Ros Altmann said she is pleased to see The Pensions Regulator pursuing the former owners of BHS on behalf of the Pension Scheme members.

“When I was Pensions Minister, he approached me to try to help him with his pension problems. I refused. He did not seem to understand how the regulatory system works. The impression I had was that he believed it was up to him to tell The Pensions Regulator how much he was willing to pay, rather than him asking the regulator to let him know what was the right amount. He believed she was being unreasonable but it is simply not up to him to decide this. The Regulator is the body established to protect our pension system and ensure employers cannot just walk away from their pension obligations,” she said.

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