ITV given six month deadline for Box Clever funding plan
The Pensions Regulator (TPR) has told ITV and four connected firms that they must deliver a future funding plan for the Box Clever Group Pension Scheme within six months.
The broadcaster and regulator have been mired in legal action for eight years over ITV's responsibilities to the scheme, with the Upper Tribunal and Court of Appeal both agreeing with TPR's case. The Supreme Court last month also dismissed an application to appeal.
The scheme has a £115m actuarial deficit and around 2,800 members and has been in Pension Protection Fund (PPF) assessment since 2014 while ITV and TPR wrangled over complex legal debates.
The dispute arises from the creation of Box Clever, a TV rental company formed in 2000 as a joint venture between Granada, now ITV, and Thorn, now Carmelite. However, the company collapsed in 2003, and TPR issued a financial support direction (FSD) against ITV.
The courts heard significant debate about whether such a move could be made retrospectively, given that all events relating to the creation and collapse of Box Clever preceded the creation of TPR and the FSD powers. Arguments were also considered relating to reasonableness and the exact corporate structure and power arrangements within Box Clever.
However, last year the Court of Appeal said ITV's arguments were "without substance" and TPR has now demanded a plan of action by September. The FSD approach does not allow the regulator to dictate the exact funding plans of ITV for the scheme, but the watchdog must approve those which are submitted.
TPR director of enforcement Erica Carroll said: "In a bid to avoid responsibility for the Box Clever scheme, ITV has used every possible legal challenge to fight against our actions to safeguard the retirements of thousands of members."
While the case was referred to the Upper Tribunal in 2012, it was drawn out by a series of appeals from ITV over TPR's submission of additional evidence in late 2013. The substantive hearings finally began in 2018.
Carroll continued: "Now they have exhausted the legal process, we look forward to receiving a credible plan to support the scheme and its members. ITV could have resolved this matter years ago and we hope they will now want to seek a swift resolution and provide closure to the scheme's 2,800 members."
ITV's shares had fallen 12% by 3pm on 17 March as a result of the cancellation of the Euro 2020 tournament due to coronavirus fears. The six-month deadline is set by TPR's Determinations Panel but ITV and the other targets are able to request an extension, which could be needed during the current market climate. Any request would be considered by TPR.
An ITV spokesman said: "ITV notes the Supreme Court's decision and looks forward to meeting TPR to take the matter forward."
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