Interserve in crunch talks over pensions
THE pensions watchdog is on red alert over the crisis at Interserve amid fears over the future of the ailing contractor’s retirement scheme.
The Pensions Regulator (TPR) is in talks with company bosses and trustees of the pension scheme as the firm fights for survival.
shares are down 49pc this week and 87pc this year amid warnings that it could become ‘Carillion mark two’ following the collapse of its rival in January. Interserve is now in crunch talks with its lenders to ease its crippling debt burden.
The firm, which works in schools, the NHs, prisons and other state sectors, has said its debt could reach as much as £650m by the end of the year. The crisis has sparked fears over the future of 75,000 Interserve staff and the members of its pension scheme.
The regulator has been in talks with the pension scheme’s trustees over a period of several months. The watchdog has also been in touch with company bosses.
The talks that have been held with the regulator are not routine, though TPR often holds discussions with companies during major corporate changes such as mergers or restructurings.
A spokesman for TPR said: ‘We are working closely with both the trustee and sponsoring employers to ensure the best outcome for pension scheme members. We will not be commenting further.’ Interserve’s defined benefit pension scheme had a surplus of £32.1m at the end of June, up from a deficit of £48m at the end of 2017. The improvement comes from a change in the way that future pension increases are calculated. If a company goes bust and cannot afford to pay its pension liabilities, employees are usually protected by the industry lifeboat, the Pension Protection Fund (PPF).
Interserve has not been in discussions with the PPF so far.