Arcadia workers must “not pay the price of Philip Green’s greed”, says Miliband

Ed Miliband has declared that workers at Arcadia should “not pay the price of Philip Green’s greed” while highlighting that the chairman’s family recently took the largest dividend payment in British history.

The Shadow Business Secretary raised the plight of workers at Arcadia and Debenhams, two large high street employers which recently collapsed, during an urgent question in parliament today and urged the government to take action.

Miliband told the minister this afternoon: “Let me join the minister in expressing deep sympathy for those who are at risk of losing their jobs. The test of government and indeed this House is whether that sympathy translates into action…

“Philip Green owes the workers at Arcadia a moral duty. His family took a dividend worth £1.2bn from the company, the largest in UK history, more than three times the size of the pension deficit.

“The workers at Arcadia should not pay the price of Philip Green’s greed. So will the minister now publicly call for Philip Green to make good any shortfall in the pension scheme? And will he ensure the pensions regulator takes all possible steps to make sure this happens?”

Miliband also argued that the government must “learn lessons” from the demise of the two chains and subsequent fallout and bring forward legislation to ensure pension fund holders are made priority creditors when businesses go bust.

He argued: “In the insolvency bill this summer, Labour put forward amendments to make pension fund holders priority creditors when businesses went bust. The minister said it was not necessary.

“Does he now agree now that it was a mistake, that this change would have better protected the pensions at Arcadia and that this should be put right through legislation in the future?”

Miliband called for “specific and targeted help” to ensure that those facing redundancy can get back into work and for additional support to high street businesses in the pandemic, including the extension of the rent evictions moratorium.

Reports emerged earlier this week that Debenhams is set to close its stores after the retail business failed to secure a rescue plan. Around 12,000 workers will lose their jobs when the chain’s 124 shops stop trading.

The news followed just hours after the Arcadia group, of which Philip Green is chairman, went into administration. The organisation owns Topshop, Topman, Wallis, Evans, Burton, Miss Selfridge, Dorothy Perkins and Outfit.

Arcadia has 444 stores in the UK and 22 overseas with and overall total of 13,000 employees. While online companies such as Asos are thought to be interested in acquiring some of the brands, they are unlikely to take on the physical stores.

Shopworkers’ union Usdaw has called on the Conservatives to work with retail employers and trade unions to develop a recovery plan for the industry and highlighted that the sector was already struggling before the pandemic began.

Commenting on the scale of the challenge in the crisis, Paddy Lillis said: “Over 200,000 retail job losses and 20,000 store closures this year are absolutely devastating and lay bare the scale of the challenge the industry faces.”

The general secretary added: “What retail needs is a joined up strategy of unions, employers and government working together to develop a recovery plan.

“There are substantial issues that need to be addressed likes rents, rates and taxation, to create a level playing field between high streets and online retail. Those issues will not be resolved with the support the governemnt has already announced.

“Retail is crucial to our town and city centres, it employs around three million people across the UK. The government must take this seriously and we need a recovery plan to get the industry back on its feet.”

Labour leader Keir Starmer highlighted the impact of the two companies going bust during Prime Minister’s Questions this afternoon, calling on Boris Johnson to provide greater support to the retail industry in the health crisis.

Below is the text of the contribution made by Ed Miliband today.

Let me join the minister in expressing deep sympathy for those who are at risk of losing their jobs. The test of government and indeed this House is whether that sympathy translates into action. So I have four specific questions for him.

First, Philip Green owes the workers at Arcadia a moral duty. His family took a dividend worth £1.2bn from the company, the largest in UK history, more than three times the size of the pension deficit. The workers at Arcadia should not pay the price of Philip Green’s greed. So will the minister now publicly call for Philip Green to make good any shortfall in the pension scheme? And will he ensure the pensions regulator takes all possible steps to make sure this happens?

Second, we need to learn lessons. In the insolvency bill this summer, Labour put forward amendments to make pension fund holders priority creditors when businesses went bust. The minister said it was not necessary. Does he now agree now that it was a mistake, that this change would have better protected the pensions at Arcadia and that this should be put right through legislation in the future?

Third, on the workers at Debenhams and indeed Arcadia facing redundancy, given the scale of redundancies and the grim economic backdrop will he look at providing specific and targeted help for them to get back to work?

Fourth, we have an emergency on our high streets with an estimated 20,000 shops closing and 200,000 workers losing their jobs since the economic crisis began. While we welcome the support that has been provided, will he recognise the government must do more? Extending the rent evictions moratorium beyond December when it is due to expire. Increasing the support for hospitality businesses which was a call across this House yesterday. And addressing the massive disadvantage high streets face around business rates compared to online retailers?

Today is a day of great news on the vaccine. The government has a massive responsibility to preserve the businesses and jobs we need on the other side of this crisis. They are still not acting on a scale that meets the economic emergency our country faces. They need to do so.