Taxpayer faces bill for Comet staff

CometThe collapse of electricals retailer Comet has left the taxpayer facing a £50 million hit, a report from its administrator is expected to show.

As the remaining Comet stores prepare to close for good, the report from Deloitte is likely to indicate that insufficient funds have been raised from the winding down of the chain to pay up to £24 million in redundancy payments to 6,000 staff. This means the Government will probably have to step in and ensure workers receive their payments, the Sunday Times said.

The statement, which is expected to be published on Monday, will also disclose that unsecured creditors - including HM Revenue & Customs, which is owed £26.1 million - will receive nothing.

Secured creditors, such as the backers of Comet's parent company Hailey Acquisitions, will get payments of just under £50 million. However, the Sunday Telegraph said this represented a shortfall of £95 million on the amount owed at the time of the collapse of the 236 store chain in early November.

The scale of the problems at Comet will also be highlighted in the report, with the chain reportedly racking up losses of £95 million in the year to April, followed by a further £31 million in the subsequent five months as credit insurers lost confidence and withdrew support for the business.

Hailey was the investment vehicle put together by Henry Jackson of OpCapita, who raised the funding from unnamed investors for Comet's takeover from French retail group Darty.

Deloitte has said the last 50 stores will close for the final time on Tuesday, amid speculation that the brand will be sold to an online retailer and around 20 shops picked up by rivals.

The Sunday Telegraph added that unsecured creditors also included ITV and Google, which are owed £1.2 million and £602,000 respectively for unpaid advertising bills, while holders of £4.7 million of unclaimed Comet gift cards and vouchers are also on the list.

However, an estimated £40 million of payments will be made to suppliers and £2.1 million of holiday and back pay owed to staff will be paid in full.