A PETITION to support Silentnight as it fights to avoid going into administration has been launched by Pendle Labour Party.
Its members will collect signatures on a stall in Barnoldswick Town Square on Saturday from 10 a.m. to 2 p.m.
They are calling on Pendle Council to put pressure on ministers to assist the company and its workforce.
Member Bill Roberts said: “It is a critical issue for the local area. We’ve also offered a meeting with the Chief Executive of Silentnight to discuss the issues.”
Silentnight announced it has applied for a Company Voluntary Arrangement, where the firm asks creditors to agree to a repayment schedule which will see them recuperate 65p of every £1 they are owed.
The company, one of Pendle’s biggest employers with 650 staff based in Barnoldswick, found itself in trouble after Yorkshire Bank withdrew its funding in January, leaving a £100m. pension hole.
The firm’s directors will meet creditors next week to seek approval for the CVA.
Labour County Coun. George Adam said: “This is very worrying news from one of Pendle’s major employers and reflects the inability of this government to boost the economy. Without a proper policy for growth, companies like Silentnight are suffering the biggest squeeze on consumer spending power since the 1970s. And there is no serious pressure to force banks to increase lending.”
Pendle MP Andrew Stephenson responded, saying: “While Pendle Council, myself and many others are working to ensure the firm comes through these difficulties, the local Labour Party is trying to make political capital out of the situation. People deserve better from their elected representatives.”
County Coun. Mohammed Iqbal, leader of the Labour Group in Pendle Council, said he was concerned about what the CVA could mean for past and present employees’ pension funds. “A matter of concern about the proposed Silentnight CVA is that, according to reports, the company is looking to reduce its pension responsibilities to solve its liquidity problems,” he said. “If, as has been reported, the CVA would mean 65p in the pound for creditors what does that leave pensioners with?”
Silentnight said if the CVA is approved Silentnight’s pension scheme, which has 1,500 members, will be assessed for inclusion in the Pension Protection Fund. This is run by a quango that pays compensation to employees of businesses that have gone through a qualifying insolvency event to continue their pension payments.
In this scheme, members who are over normal retirement age or retired early due to ill health receive 100% of the pension they are currently receiving. Other members receive 90% compensation.
The firm said of the 1,500 members, only 100 are still working at Silentnight and contributing to the scheme.
There’s more on this story in this week’s Leader-Times Newspapers.