UK regulator grants Guinness Peat more time to address warning notice
Guinness Peat Group (GPG) has been granted a further three months to address a formal warning by the UK Pension Regulator (TPR), the result of deficits in two of its pension funds.
GPG and the trustees of one of the affected defined benefit schemes, the Brunel Holdings Pension Scheme, requested that a deadline to submit written responses to January’s warning be extended, delaying any resolution until the first half of 2015.
TPR’s warning is a step ahead of its issuing a financial support direction (FSD), whereby it specifies the level of financial support a sponsor must provide to schemes.
Publishing its half-yearly results, the New Zealand-based investment holding company repeated that it was prepared to set aside £124m (€156m) to support both the Brunel and Staveley Industries Retirement Benefits Scheme.
At the end of June, both the Brunel and Staveley schemes had IAS19 deficits of £35m, up from £28m, while a third fund, the Coats UK Pension Plan, had a deficit of £108m.
However, it said discussions with the regulator had shown that the amount would not be “sufficient to result in TPR ceasing its investigations and withdrawing the Warning Notices”.
The report adds: “The currently proposed package of measures comprises a combination of cash invested directly into the schemes and cash invested into the sponsoring employers of the schemes, which would be loaned within the group over the long term.
“Capped parent company guarantees from GPG plc are also included.”
The company said that, if no agreement can be reached among trustees, the board and the regulator that it deems acceptable, it will instead be referred to the regulator’s Determinations Panel.
GPG said it did not expect a panel hearing to occur before the first half of 2015, after it negotiated the three-month extension to respond to TPR’s warning.