The Pensions Regulator (TPR) wants to be given greater powers to block merger deals involving companies with stressed pension schemes, its chief executive has said.
Lesley Titcomb (pictured) told the Financial Times a new power to veto mergers and acquisitions in certain circumstances could better protect the 11 million members of final salary schemes in the private sector.
She urged the government to act quickly to tackle weaknesses in the system after problems with defined benefit (DB) pensions were exposed in a recent parliamentary probe into the failure of BHS.
The Work and Pensions Committee is currently debating the regulation of defined benefit pension schemes and whether the regulator should be handed extra powers.
BHS' collapse left about 20,000 members of its pension scheme facing cuts to their retirement income, with the pension deficit estimated at £571m in March.
Under the current system Sir Philip Green was not required to obtain clearance from the regulator before selling BHS, along with its underfunded pension scheme, to Dominic Chappell in 2015 for £1.
Titcomb said: "Another BHS-type sale could happen because of clearance being voluntary. If we are not approached then there is nothing we can doing about it. That is why one of the areas we need to look at is whether, in certain circumstances, corporate transactions should come to us."
Titcomb said any new power to force companies to obtain prior clearance should be targeted. "We are talking about a limited set of circumstances here, perhaps where there is underfunding [of the pension]," she told the FT.
She added: "I think we do need to recognise, though, that any such power has to be proportionate. To require all corporate transactions to come through us would gum up the system. Cases like BHS are rare."
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