U.K.'s May Plans Tougher Take-Over Rules to Protect Pensions

(Bloomberg) -- Prime Minister Theresa May is set to impose new restrictions on company take-overs in the U.K. as part of a plan to protect workers' pensions from “unscrupulous” bosses.

If re-elected in June, May's Conservatives will give authorities the power to block such deals and launch criminal prosecutions of company bosses who put pension schemes at risk, the party said.

“I am setting out our plans, if elected, to ensure the pensions of ordinary working people are protected against the actions of unscrupulous company bosses,” May said Saturday in an emailed statement. “Safeguarding pensions to ensure dignity in retirement is about security for families, and it's another example of the choice in this election.”

May's promise comes as new opinion polls show her party remains on course to win a bigger majority in the June 8 vote , which Tories say they need in order to strengthen the premier's position ahead of Brexit negotiations.

Her focus on protecting pensions follows a public outcry in Britain over the collapse of the retail chain BHS after Philip Green, majority owner of clothier Arcadia group, sold the company. In February, he agreed to pay as much as 363 million pounds ($470 million) to compensate 19,000 former workers of the collapsed department store chain after months of haggling with the country's Pensions Regulator.

‘Punitive Fines'

Under May's plan, any company pursuing a merger or acquisition valued over a set amount -– or with more than a prescribed number of members -– would have to notify the Pensions Regulator, which could then apply clearance conditions, the Conservatives said on Saturday.

In extreme cases, where there was no credible plan or willingness to ensure the solvency of the scheme, the pension scheme or Pensions Regulator could be given new powers to stand in the way of takeovers, the party said in an emailed statement.

Other sanctions could include “punitive fines” for those found to have willfully left a pension plan under-resourced; barring individuals from being company directors for a period of time; and introducing a specific new criminal offense of a company board deliberately or recklessly putting a pension scheme at risk.

A poll from ORB for the Sunday edition of the Telegraph newspaper put the Conservatives at 42 percent, with Labour at 31 percent, the Liberal Democrats at 10 percent, and the U.K. Independence Party (UKIP) at eight percent.

Another survey from Opinium for the Observer newspaper put the Tories at 47 percent, up 2 percentage points, with Labour at 30 percent, up 4 points, and the Liberal Democrats down 3 points to 8 percent. UKIP polled 7 percent.

To contact the reporter on this story: Tim Ross in London at tross54@bloomberg.net.

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Steven Crabill, Ros Krasny