Wilko’s founding family asked to cover pension shortfall

Wilko’s founding family was branded “the unacceptable face of capitalism” this weekend after saying it had no plans to help plug the bankrupt retailer’s £70m pension hole.

The discount chain collapsed a year ago with the loss of more than 12,000 jobs and the closure of 400 stores. The Mail on Sunday revealed that Wilko’s owners – descendants of its founder James Kemsey Wilkinson – had made £77m in dividends over the previous decade.

Wilko had debts of £625m when it collapsed. The collapse left its pension fund with a huge deficit, meaning more than 1,000 workers who have not yet retired face the prospect of a reduction in their annual income for life.

But Wilko’s parent company, Amalgamated Holdings Wilkinson Limited (AHWL), said last week it did not believe it had any obligation to plug the pension gap.

AHWL, whose directors include Lisa Wilkinson, granddaughter of the company’s founder, added that it had “never been the sponsoring employer” nor provided a guarantee to the scheme.

The comments were criticised by Lord Mann, a former Labour MP and chairman of the Treasury Select Committee, whose Bassetlaw constituency included Wilko’s Worksop headquarters. He described the landlords as “the unacceptable new face of capitalism”.

“Their place in history as a successful family business has been destroyed in a frenzy of greed. It’s quite appalling, the law is clearly too weak,” Mann added.

Wilko’s pension scheme could be rescued by the Pension Protection Fund (PPF), the industry’s lifeline which is assessing the scheme. Experts said there was also precedent of owners poking holes in pension funds.

Dr Gordon Fletcher, from the University of Salford Business School, said businessman Sir Philip Green paid £363m into the pension fund of 11,000 BHS workers two years after its collapse in 2016. There are growing calls for the Wilkinson family to follow suit.

“It is an absolute disgrace that the family owners of Wilko feel they do not have to face up to their responsibilities towards loyal workers,” said Nadine Houghton, national officer of the GMB union.

Last week there was no one at the £3m three-storey house occupied by Lisa Wilkinson and her husband on one of Cambridge’s most exclusive streets.

Cobwebs had accumulated around the front doors of the property.

A neighbor said they hadn’t seen Lisa Wilkinson in weeks.

Last year, she tearfully told MPs she was devastated by the collapse of the discount chain but claimed the family’s multi-billion pound fortune was not enough to repair the pension fund. The parent company did not have enough assets, which were mostly tied up in start-ups and property in the UK, Wilkinson said.

Only £20m of the £70m pension fund deficit is secured against Wilko assets, meaning pensioners will lose most of what they are owed unless the Wilkinson family pays up or the PPF makes up the shortfall.

The PPF promises to pay all pensions already in receipt, but only about 90 percent of payments due to members who had not retired when their employer went bust.

A PPF spokesperson said: ‘We are working closely with the Pensions Regulator and scheme trustees to ensure the best possible outcome for members.

“We want to reassure members, at what must be a worrying time for them, that we are here to protect them for as long as they need us.”