Work and Pensions Committee chair Frank Field will have a private meeting with the Insolvency Service to obtain more detail on the investigations around the collapse of BHS, it has emerged.
In a letter to the committee, Insolvency Service chief executive, Sarah Albon, invited Field to discuss details around the Financial Reporting Council (FRC) investigation into the retailer, after the body decided not to pursue any further “disqualification action” over the case.
In August, the FRC published a “devastating” report slamming PwC for its role in the 2014 audit of Philip Green’s parent firm Taveta Group, handing them a £6.5m fine and told to monitor and support its Leeds Audit Practice and provide detailed annual reports to the FRC for the next three years.
Field said: “It is difficult for the outside observer to understand why the Insolvency Service sees no reason for further action on what happened at BHS.
“The current system apparently cannot prevent, capture or punish the conduct that ran BHS into the ground and left its pensioners well short of their entitlement. I hope the Insolvency Service’s insights can now help us start to make the UK’s corporate governance fit for purpose.”
Writing to the FRC chief executive Stephen Haddrill, Field said that it was “difficult to believe that the 2014 audit was an isolated case”, given the extent of the failures.
Sir John Kingman, undertaking an independent review of the FRC, confirmed that he would be considering this as part of their review.
Following the high profile collapses of BHS and Carillion, new proposed measures would give powers to the Insolvency Service, allowing it to investigate the directors of dissolved companies, enhancing their recovery powers and the ability to disqualify directors of holding companies.
BHS, which had 163 stores and employed 11,000 people, entered liquidation on 25 April 2016 with a pension scheme deficit of £571m.
The BHS2 Pension Scheme has completed an £800m buyout with Pension Insurance Corporation, securing its 9,000 members’ pension benefits in full.
The scheme covers the members of two predecessor schemes, was set up in 2017 following the collapse of BHS and a subsequent £363m cash injection from Sir Philip Green.