Business

Arcadia paid £2m to favoured BHS staff

Sir Philip Green

Sir Philip Green's Arcadia made special payments to favoured BHS staff, a BBC investigation has discovered.

Panorama found that around 200 staff at BHS headquarters received more than £2m in total as the business went into liquidation.

Sir Philip's spokesman said payments were made to help retain staff as they looked for a buyer.

But the programme found that staff only received the payments after no buyer had been found.

'Philip bonus'

It was announced on 2 June this year that no buyer had been found for BHS and staff were told 11,000 jobs would go.

Panorama has discovered that on the same day, around 200 staff at BHS head office in London were told they would receive an ex-gratia payment.

Panorama was told that the payments were not included in final salary payslips but were transferred into employee bank accounts. Some staff called the payments a "Philip bonus."

Sir Philip's spokesman initially told Panorama that the payments had been funded by Arcadia to help retain staff while the administrator looked for a buyer.

But the programme found that staff were only told they were getting the payments after no buyer for the business had been found.

Sir Philip's spokesman later told the programme that maybe payment had been delayed.

The collapse of BHS earlier this year with a half a billion pound hole in its pension fund has left many employees feeling betrayed.

Image caption Anne and Keith Bostock worked for BHS for years.

Sir Philip's generosity to a select few at head office didn't extend to other BHS workers, like Anne Bostock. She had worked at the BHS store in Stockport for 42 years. She met her husband Keith there.

"It doesn't surprise me because the higher up they are the better looked after you are," says Keith.

"It's the people on the bottom end who do the hard work at the sharp end, the coal face, whatever who actually make the firm work, [who] generate the profit always get left behind."

Earlier this year Sir Philip told a Parliamentary select committee that the first time he had thought of selling BHS was probably in 2014. Panorama has discovered that he considered an offer to buy BHS from his own non executive chairman, seven years earlier in 2007.

Sir Philip's spokesman told Panorama that every business gets approached from time to time, but there was no sale process and nothing happened.

However, Panorama also understands that in 2007, Sir Philip even named his price - he would want half a billion pounds for BHS and his own chief financial officer attended a meeting at investment bank Goldman Sachs to discuss a possible deal.

Panorama asked Sir Philip's spokesman about the meeting at Goldman Sachs. He said they had been approached by Goldman Sachs and repeated there was no sale process.

There are three investigations now looking into the collapse of BHS and there are calls for Sir Philip to be stripped of his knighthood.

MPs are set to debate the collapse of BHS in Parliament later this month.

You can watch Panorama BHS: How Did it Happen? on Monday 10 October at 8.30PM on BBC One or catch up aftewards on iPlayer

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