MNRPF chair admits uncertainty over P&O Ferries’ obligations

On March 17, P&O Ferries abruptly dismissed 800 workers via video link, drawing the ire of government and unions.

P&O Ferries has pension assets in the MNRPF, a so-called ‘last-man standing’ pension fund. It also participates in the Merchant Navy Officers Pension Fund.

In these schemes, should an employer exit the scheme or become insolvent, their pension liabilities become known as ‘orphan liabilities’. The scheme’s remaining employers become responsible for these liabilities.

“P&O have not said that they will not meet their obligations, but I think that there’s a much wider concern for me as the chair of trustees,” Oldland told the BBC. 

“The news that has occurred in regard to P&O does challenge member confidence in the pension scheme and in their pensions,” he admitted.

The chair reassured members that their pensions are safe, but made the point that as a last-man standing pension fund, other employers in the fund carry the same responsibilities to the overall fund and its members. 

Oldland quoted a figure in excess of £140mn that the fund is contractually owed by P&O Ferries. On March 18, the Financial Times reported that the Pensions Regulator was investigating concerns that P&O Ferries had not paid a £146mn debt to the scheme.

“We are in discussions with P&O. I cannot predict how successful those discussions will result in. All I can say is that P&O have not said they will not meet their obligations,” he said.

“But clearly, from a trustee perspective, any influence, any pressure that can be brought to bear, whether it’s by the government, whether it’s by TPR to assist the trustee in collecting the contributions owed to the fund by P&O Ferries will be very, very welcome.

“We would like P&O to confirm and commit to meeting their full obligation in the shortest possible timeframe, and so that all of the other employers and companies that support this fund are not affected, and we don’t have a domino effect on other businesses,” he continued.

“We don’t know whether we’re going to get it, we don’t know that we’re not going to get it.”

Oldland admitted that any company that is in financial difficulty must cause concern to the trustees over whether they would receive the funds owed.

Pensions Expert understands that the employer is committed to meeting its liabilities and has paid the MNRPF over £80mn since 2016. The outstanding deficits are secured by a guarantee over three of P&O Ferries' ships.

The MMOPF issued a statement on March 21 assuring its members that its assets are held in a separate trust.

“The trustee has appropriate arrangements in place to ensure that any remaining contributions due to the fund are collected,” it said.

Former pensions minister Ros Altmann told the BBC that “it would be adding insult to injury if there were a decision made that they shouldn’t or won’t put the large sums of money in that had been required over the past few years to try and honour the pension commitments properly”.

P&O Ferries declined to comment.