BHS staff reassured over wages as owner works to save collapsed retailer

Staff at stricken retailer BHS have been paid this week and will continue to receive wages as a "priority payment", administrators have confirmed.

Administrators Duff & Phelps said the chain's 11,000-strong workforce had been paid over Wednesday and Thursday and added that it has been "working hard to stabilise the business" since its failure on Monday.

The update comes after the owner of BHS said he is working with private US investors to put together a rescue package for the collapsed retailer.

Dominic Chappell said he would look to save a "substantial majority" of the department store chain's 164 shops and continue the business under the BHS brand.

Philip Duffy, joint administrator of BHS, said they were pleased to have received "a number of expressions of interest".

He added: "We appreciate the hard work of staff that have ensured that stores have continued to trade as normal.

"Staff have been paid over the course of yesterday and today and we want to reassure them that they will continue to be so whilst the group remains in administration, as a priority payment."

BHS went into administration on Monday, putting 11,000 jobs at risk.

Duff & Phelps are currently seeking buyers for the retailer as a going concern, although industry experts have expressed doubts over whether BHS can be saved in its current form.

Speaking to the Press Association, Mr Chappell said: "The pension deficit was weighing us down and not allowing us to move forward.

"After the administration, when the pensions side of the business is sorted out, we will be able to move on. I'm working with US investors to buy a substantial majority of stores.

His move came as it emerged that a second committee of MPs would investigate the chain's collapse.

Mr Chappell acquired BHS for £1 from retail tycoon Sir Philip Green last year, taking on a £571 million pension deficit.

Both men have come under fire - Sir Philip for paying his family £400 million in dividends from the business and mismanaging the pension scheme, and Mr Chappell for sucking a reported £25 million out of BHS over the last year.

However, Mr Chappell hit back, saying: "It's a storm in a teacup. All the money that was taken out was legal and legitimate and went to pay fees."

While not blaming Sir Philip directly for the retailer's demise, when asked where the blame for the retailer's collapse lies, Mr Chappell said: "You only need to look at the pension deficit when we took it over."

It is understood that a number of retailers, including Sports Direct, are considering making a play for several stores.

On Tuesday it was revealed that Sir Philip will be called to appear before the Work and Pensions Select Committee to face questions over the collapse.

And a second committee of MPs is also poised to examine what went wrong at BHS.

The Business, Innovation and Skills (BIS) Select Committee has announced an inquiry into the sale and acquisition of the firm.

The committee said it will examine the steps taken by Sir Philip's Arcadia Group to ensure that BHS's new owner, Retail Acquisitions Limited, headed by Mr Chappell, was responsible. It said the "inquiry will also explore what checks were undertaken by RAL to verify that BHS was a going concern".

Committee chairman Iain Wright said: "The collapse of BHS brings misery and uncertainty for thousands of workers and also places a potentially significant burden on the taxpayer in the form of pension liabilities.

"The sale and acquisition of BHS raises real questions about whether directors acted in the best long-term interests of the company and their employees.

"Is there too much of an incentive in the system for owners to asset-strip, take out vast sums for personal gain, and then dump and run, leaving the taxpayer to pick up the tab when the company fails, rather than create value for the long term?

"In this inquiry we'll want to question the role of advisers - the lawyers, bankers, auditors and others who advised on the sale and purchase of BHS - and examine the legal obligations of company directors in this process."