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Theresa May repeats vow to clamp down on company pension abuse
Prime Minister Theresa May has repeated her warning that company bosses who fail to protect workers pension schemes will face huge fines.
After the collapse of Carillion left a £900m deficit in its pension scheme, May repeating a still-unfulfilled pledge from April last year that she will protect workers pensions from company abuse.
May said she will take action against companies like Carillion, which rewarded shareholders with dividend increases as pension deficit grew from £318m in 2015 to £587m last year and chief executive Richard Howson was given a £1.5m pay package, including a £245,000 bonus a year before the company's collapse.
The Department for Work and Pensions is expected to release a white paper in March with "tough new rules" for bosses who are not protecting their workers' future.
The paper had been expected this winter with the pensions regulator to given powers to issue fines on company directors that are abusing their workers' pension funding and find them fully accountable if their pension schemes collapse.
One of the measures that is also being discussed would give regulators permission to block takeovers that may put pension schemes at risk.
The PM said that while governments should not get involved in the everyday management of businesses, the state should protect the ordinary working people. She criticises the business culture that prioritises the immediate financial rewards than the long term well-being of their workers.
"Too often we've seen top executives reaping big bonuses for recklessly putting short-term profit ahead of long-term success. Our best businesses know that is not a responsible way to run a business and those who do so will be forced to explain themselves," said May in the Observer article.