Creditors of the defunct public services charity People Can will receive as little as 18p in the pound, according to its administrator
The charity, which supported homeless people, victims of domestic abuse and ex-offenders, went into liquidation in November 2012 because of a £17m pension deficit.
The professional services firm PwC, appointed as the administrator, issued a progress report to creditors this week in which it set out the likely payments.
It said more than 230 claims, totalling £19.5m, had already been submitted; 106 of these, totalling £18.6m, had been accepted and 12 claims totalling about £900,000 were still under adjudication. A further 179 claims totalling almost £1.3m are awaited, PWC said in its report. By far the biggest creditor is the Pensions Trust, which is owed in excess of £17m.
PWC said that preferential, or secured, creditors could expect full payment of the money they were owed, but the charity had no secured creditors. Unsecured creditors will receive between 18p and 22p in the pound.
The report also showed that People Can had incurred more than £1m in additional debts before and during administration, including £10,000 on insurance fees and nearly £90,000 in legal fees.
More than £6.6m of the charity’s assets were released to PwC as part of the liquidation process to repay creditors, although £240,000 of this is ring-fenced for third-party "trust claims". In this case, trust claims are creditors who had specific contracts with the charity, the names of which PwC could not reveal for confidentiality reasons, and the money is ring-fenced until these claims are verified.
The PwC report also details the efforts it has made to sell land owned by the charity in Toxteth, Liverpool. However, overcoming a legal covenant protecting the sale of the land to developers was deemed not to be cost-effective, so PwC "formally disclaimed the land as an onerous asset" – one that would cost more to sell it than it is worth.
The land has since been given to Liverpool City Council, the Chief Land Registrar, Registrar of Companies, Crown Estate Commissioners and the County Palatine of Lancaster.
PwC said it sold IT equipment for almost £7,000 and secured a refund of more than £60,000 on business rates, as well as nearly £1,000 of refunds on insurance premiums.