The Pensions Regulator (TPR) has secured a settlement for the Plumbing & Mechanical Services (UK) Industry Pension Scheme after a participating employer took steps to avoid paying a section 75 debt of around £252,000.

TPR said Cliden Construction Limited (CCL) triggered the debt in early 2019 after it ceased to employ active members of the defined benefit (DB) multi-employer scheme.

However, instead of recovering money owed to it by a connected company and using the proceeds to meet its pension liability, CCL undertook a series of transactions that reduced the assets available to the scheme.

TPR noted that its intervention ensured CCL’s liability was not left to be carried by the scheme’s other participating employers.

As at 5 April 2023, the scheme had assets of around £1.43bn and a buyout deficit of approximately £258m. It closed to future accrual in 2019.

CCL ceased to employ active members in late 2018 and was notified by the trustee in February 2019 that a section 75 debt had been triggered.

The trustee subsequently estimated the debt at £251,600.

At the time, Stuchbery Investments Limited (SIL), one of CCL’s minority shareholders, owed a substantial intercompany debt to CCL.

TPR found that CCL reclassified its shares in 2019, enabling it to declare a dividend of £252,163 to SIL.

No cash was transferred, but the dividend was accounted for by reducing the debt owed by SIL to CCL to zero.

Further dividends were recorded in CCL’s accounts for the years ending September 2020 and September 2021, further reducing the assets that could have been used to pay the pension debt.

TPR found that CCL director, Trevor Stuchbery, was aware of the existence and estimated size of the section 75 debt. He was also a director and 50 per cent shareholder of SIL.

However, CCL entered liquidation in June 2023, leaving the scheme unable to recover any part of the debt.

TPR subsequently launched an anti-avoidance investigation and considered using its power under section 38 of the Pensions Act 2004 to issue Contribution Notices.

In June 2025, it issued a Warning Notice seeking Contribution Notices against Stuchbery and SIL on a joint and several basis.

The regulator stated its view was that the main purpose of the actions undertaken by Stuchbery and SIL was to prevent the scheme from recovering the section 75 debt.

TPR used section 72 information-gathering powers and compelled individuals to attend interviews on three occasions under section 72A of the Pensions Act 2004.

It also issued a fixed penalty notice to CCL’s accountants, Thornton Springer LLP, after the firm failed to comply with an information request.

The accountants appealed after the deadline had passed, and the appeal was refused. The penalty was subsequently paid in full.

Following the Warning Notice, TPR received several settlement offers from Stuchbery and SIL.

A settlement was agreed after discussions with the trustee, and payment has now been made to the scheme. TPR did not disclose the amount.

The regulator ceased its enforcement action following the settlement.

TPR executive director of the enforcement and legal group, Gaucho Rasmussen, warned that employers could not avoid their responsibilities to pension schemes.

“Members rely on pensions to provide them with a sustainable income in retirement, and employers cannot simply walk away from their responsibilities," he said.

“While we aim to prevent harms through constructive engagement, we will not hesitate to use our enforcement powers where necessary to secure positive outcomes and as a deterrent against this type of behaviour.

“We will continue to work together with the trustees of the plumbers’ scheme to ensure that employers understand the importance of paying their debts to the scheme and the potential consequences of not doing so."

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