Pension Superfund offers 'safe harbour' for Arcadia pension schemes

The Pension Superfund has suggested that it would be interested in acquiring the Arcadia pension schemes following the retailer’s company voluntary arrangement (CVA) proposal approval.

The defined benefit pension consolidator said that it has been “watching developments at Arcadia keenly” and it is on “standby to assist the Arcadia pension scheme trustees to deliver scheme members into a safe harbour”.

Arcadia had all seven of its CVA approved by its creditors yesterday (12 June), saving its pension scheme from entering the Pension Protection Fund.

The deal includes a £175m cash injection over three years and £210m provided in security over assets.

The Pension Superfund CEO, Luke Webster, said that the “numbers and the approach by the regulator start to bring Arcadia into the scope of The Pension Superfund”.

He continued: “In our model, pensioners stand to receive a fair share of surplus returns alongside investors. This is a significant potential benefit in addition to the improved security they will have obtained on transfer.”

Arcadia has two schemes, the Arcadia Group Pension Scheme and Senior Executives Pension Scheme, which had a combined deficit of over £500m in 2018.

Webster suggested that he believed The Pension Superfund was the best way forward for the Arcadia schemes, saying: “Some think that the best support for any pension scheme is a trading employer.

“Given the challenges facing UK retailers, we might question whether that is always the case. We offer a very high level of security with generous compensation for the remaining risk.

“We believe many pensioners would be very happy with the outcomes we offer.”

Commercial consolidators The Pension Superfund and Clara Pensions are waiting for official regulation and guidance, and are yet to have any schemes transferred into them.

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