Readers Digest US parent could be held liable for UK pensions deficit
19 Feb 2010, Paul Grant, AccountancyAge
The £125m pension deficit of Readers Digest UK, which forced the company into administration, may have to be paid off by its US parent.
Under UK pension law, the Readers Digest Association could be held liable to pay some or all of the deficit, reports the Telegraph.
The Pensions Regulator, is currently considering whether to issue a ‘financial support direction’ or a ‘contribution notice’ against RDA, which will require them to make payments to reduce the deficit.
Readers Digest UK fell under the administration of Philip Sykes from Moore Stephens when it was unable to meet its pensions obligations and failed to receive approval for a deal between the RDA and the Pension Protection Fund to inject £10.9m into the UK company.
© Incisive Media Investments Limited 2012, Published by Incisive Financial Publishing Limited, Haymarket House, 28-29 Haymarket, London SW1Y 4RX, are companies registered in England and Wales with company registration numbers 04252091 & 04252093
Visitor comments
At last
As someone no longer on the Reader's Digest payroll, but many years away from receiving my RD pension, this is good news. The proposal accepted by the trustees of the fund, but blocked by the regulator, would have been farcical. It is these same trustees who have overseen the decline of the pension fund, the only non-American RDA pension fund to suffer. In my opinion it is time for a new chair of the trustees to be appointed - one who actually knows what he or she is doing.
Posted by: Steve Wilson , 19 Feb 2010 | 00:00
Readers cannot Digest final salary pension scheme
When will the general public finally grasp the fact, that if large companies cannot finance final salary pension funds, which are currently forcing them to go into liquidation, then WE, THE PUBLIC taxpayers, cannot afford to finance the Public Sector final salary schemes!
When can we expect GB Plc. to go into liquidation?
Will it be before or after all of our MPs have repaid their 'fiddled' expenses?
Posted by: Chris Slyfield , 19 Feb 2010 | 00:00