The UK Pensions Authority is investigating concerns that P&O Ferries has failed to pay a £146m debt.
The ferry operator owes most of the £1.25billion scheme’s overall deficit but has not owed any since it was acquired in 2006 by logistics giant DP World, majority-owned by the Dubai Sovereign Wealth Fund, according to a High Court voluntary contributions made judgment 2015.
P&O Ferries and its owner have been heavily criticized for their decision Dismissal of 800 British crew members without notice on Thursday to save costs by replacing them with cheaper temporary staff.
The ferry company has lost £100million a year over the past two years and said its business is not “viable” with its current workforce structures. According to an internal email from the Financial Times, the new structure will reduce staff costs by around 50 percent.
The losses were offset by DP World, which reported record results for 2021, with earnings before interest, taxes, depreciation and amortization rising 15 percent to $3.8 billion.
Labor wrote to The Pensions Regulator in January, urging the regulator to investigate P&O’s unpaid contributions to the Merchant Navy Ratings Pension Fund.
Shadow Works and Pensions Secretary Matt Rodda told Parliament in June 2021 that the debt could cause “serious problems” for the fund, which has 20,000 members working in a variety of businesses well beyond P&O.
On Friday, the Pensions Regulator confirmed it had received a letter from Rodda regarding the MNRPF.
“We are working closely with the Trustee of the MNRPF to protect savers of pension schemes,” the regulator said. “We are not commenting further at this time.”
The MNRPF system reported a deficit of £96m when it was last assessed in 2020. As a last-man-standing multi-employer pension scheme, if a participating employer has difficulty paying contributions, other employers must meet the default contributions. About 100 employers participate in the program, but only about half of them are required to contribute.
P&O has paid more than £80million into the fund since 2016 and the outstanding deficit is secured against two of the ferry company’s vessels, according to a person with knowledge of the matter.
P&O declined to comment on its pension obligations.
The scheme’s trustees said: “We are working with the Pensions Regulator to support any investigation or action that would protect the interests of the fund, both in terms of the safety of members’ benefits and the impact on other participating employers .”
In 2018, the Pensions Regulator launched an investigation into the governance of the MNRPF and the following year issued a warning recommending that an independent trustee be appointed to the system due to numerous governance issues.
Additional reporting by Simeon Kerr in Dubai
https://www.ft.com/content/dffbab03-fc8f-49fa-85c4-a87cab076aaa The regulator is investigating concerns about P&O Ferries’ pension payments