Former employees of Wilko have called on MPs to hold the Wilkinson family, which owned the company, to account over the collapse of the budget retailer this year.
The GMB union, which represents thousands of former Wilko staff, has written to Liam Byrne MP, the newly elected Labour chair of parliament’s business and trade select committee, to hold a special emergency session to question the family.
All 400 Wilko stores were shut last month with the loss of almost 12,400 jobs, leaving large gaps on numerous high streets, after the company called in administrators in August as it struggled with debts of £625m.
The group’s pension fund is being assessed for the industry-funded lifeboat scheme as it was left with a deficit of just over £70m, only £20m of which was cleared by the sale of Wilko assets it held a charge over.
Under the Pension Protection Fund scheme, those of pensionable age or already collecting their cash will receive their full payout but other savers’ funds will be cut by 10%.
Although the pension fund is in line, with other unsecured creditors, for further cash injections from money raised through the breakup of the group, it is unlikely to receive more than £4m extra, according to administrators.
The family reportedly took £77m in dividends from Wilko over the decade before its collapse, including £9m since 2019 – although this figure includes a payment, including several properties, related to one side of the Wilkinson family selling their stake to the other in 2015. The company injected more than £4m a year to help support its pension fund from 2019 to 2021 and £8m last year.
The retailer was founded in 1930 when JK Wilkinson opened his first store in Leicester, and the family continued to control the company until its collapse, with a family member, Lisa Wilkinson, stepping down as chair only at the start of this year.
She has defended the decision to pay the dividends. In August, after Wilko’s collapse, Wilkinson said: “What we have taken out really wouldn’t have made a difference,” adding that the group’s board “went through the right governance” before signing off the dividends, ensuring there were “profits or reserved profits” and sufficient cash.
Nadine Houghton, the national officer of the GMB, said: “From ignoring clear warnings about the business’s future, to dishing out millions in payouts for owners and shareholders, Wilko management has failed at every turn.
“The collapse of Wilko isn’t just a tragedy for its loyal workforce, it will also add to the decline of high streets across the country. Wilko workers deserve answers from the company that crushed their livelihoods.”
The Pensions Regulator is scrutinising the handling of the company’s finances in the run-up to its collapse. It has the power to pursue owners to plug pension shortfalls if their actions are deemed to have put savers’ benefits at risk.
Parliament is on a break before the king’s speech next week but a spokesperson for the business and trade select committee said: “The chair has been very clear that he is determined to see the committee sustain its work on exposing corporate misdemeanour.”
They added that the committee’s future programme was flexible and any announcements about hearings would be made on its website. MPs have previously looked into the demise of BHS and Debenhams.
PwC and the Wilkinson family declined to comment.
