Ryan FowlerThe Pensions Regulator has published details of its intervention to secure a stronger outcome for more than 13,000 members of the Northern Foods Pension Scheme after identifying concerns linked to restructuring activity at the scheme’s sponsoring employer.
The regulator said the agreed support package is designed to help the scheme reach self-sufficiency over the next decade, following a period in which the employer covenant had weakened.
Gaucho Rasmussen (pictured), executive director of regulatory compliance at TPR, said: “We expect trustees and sponsoring employers to work together to protect their pension scheme and its members.
“Where corporate transactions take place and the pension scheme is impacted, it’s vital that the pension scheme is treated equitably compared with other stakeholders.
“We can and will use our enforcement powers to support a fair outcome for pension scheme members.
“This includes pursuing financial support from companies associated with the employers, including those outside the employer group.”
TPR said it became concerned after identifying restructuring activity by the owner of Northern Foods Limited.
The sale of multiple businesses between 2018 and 2020 weakened the support for the pension scheme, and the scheme received only a small share of proceeds from disposals totalling more than £400m.
TPR opened an avoidance case, concluding that the scheme had not been treated fairly compared with other stakeholders and that the direct covenant had been significantly reduced.
In July 2024, the regulator issued a warning notice under section 43 of the Pensions Act 2004 seeking formal financial support from Boparan Holdings Limited, its associated entity Boparan Private Office Limited, and several subsidiaries.
Following engagement with the companies and the scheme’s trustee, a joint support package has now been agreed.
Under the package, 2 Sisters Food Group Limited will replace Northern Foods Limited as the scheme’s statutory employer.
Around £300m in contributions will be paid by June 2034 to support the scheme in reaching full funding on a low-dependency basis.
Boparan Holdings’ guarantee has been extended to cover all ongoing liabilities, including the full section 75 debt if required, with material guarantees also provided by its subsidiaries.
The scheme will receive 100% of disposal proceeds from one remaining Northern Foods business and 30% from another if sold.
Boparan Private Office has additionally provided a significant unsecured guarantee for future contributions.
The scheme’s deficit on a section 75 basis has fallen from about £1bn in 2019 to £372.1m at the end of March 2025.
TPR said the new arrangements provide a realistic path to self-sufficiency with enhanced direct and contingent support in place.
