More than £2.5m will be paid into the Danapak Flexibles Retirement Benefits Scheme (DFRBS) following a recent court ruling and previous enforcement action by The Pensions Regulator (TPR).  

TPR previously took enforcement action after money was taken from Dundee packaging firm Discovery Flexibles Limited (DFL) despite its pension scheme, DFRBS, having a significant deficit.

The latest update on this action confirmed that "millions" have been returned to the scheme via its trustees, although valuations as of 31 March 2023 suggested that the scheme had a technical provisions deficit of £10.5m, a section 179 deficit of £7.5m and a buyout deficit of £13m.

DFL, which has supplied packaging to household brands, was bought by Thomas Christopher Wrigley and his wife Elizabeth Wrigley for £1 in 2008, with the business later sold to its current owners for the same amount in 2019.

TPR's investigation, launched following reports from the scheme's independent trustee, found that money had been extracted from the firm while its pension scheme was in deficit between 2008 and 2019, which, according to TPR, caused material detriment to the scheme.

To help plug the scheme’s deficit, TPR sought payments by way of contribution notices from Chris Wrigley, Elizabeth Wrigley, Chris Wrigley's brother, Robert Paul Wrigley, and his sister Elizabeth Ann Pelgrave.

TPR was able to reach agreements with the some of the individuals involved, as Chris Wrigley and Elizabeth Wrigley agreed to pay £2m into the scheme in settlement of TPR’s regulatory action against them in October 2023, while Paul Wrigley paid £222,482.83, the amount TPR’s Determinations Panel determined his contribution notice should be, which was formed of £217,353.16 plus interest.

However, Pelgrave, who was issued with a contribution notice for the same amount, referred the matter to the Upper Tribunal, which reviews decisions by TPR.

The final decision on the case was shared by the Upper Tribunal this week (4 August), upholding the regulator's determination and confirming that Pelgrave should pay £245,749 plus interest of approximately £85,000.

This means that a total of approximately £2,552,000 will be paid into the scheme as a result of TPR's anti-avoidance action.

TPR executive director of regulatory compliance, Gaucho Rasmussen, held up the case as a demonstration of TPR's commitment to protecting savers and preserving the integrity of the pensions system.

"It also shows that we remain open to engagement and settlement where it delivers good outcomes for schemes," he added. 

"Importantly, it highlights that even when an employer remains in business, we will intervene where necessary to safeguard pension benefits.

"The pensions system relies on employers with defined benefit schemes doing the right thing by their savers – and the vast majority do.

"But when things go wrong, mechanisms are in place to alert us. And when savers are at risk, we act to put things right."

This is not the first action taken against Chris Wrigley, who, as well as being chief executive of Discovery Flexibles, was also chair of trustees of DFRBS until TPR moved to protect the scheme, banning him from acting as a trustee in December 2017.

In November 2018, Chris Wrigley was also convicted of refusing to give information to TPR after he repeatedly refused to comply with TPR’s requests for information in connection with an investigation into how the scheme was being run.

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