Green told MPs that, with hindsight, the pensions issues should have dealt with when he first bought BHS, ‘which would have been easy to do and we wouldn’t be here now if that was the case’.

Green described what he called a ‘disconnect’ between the management team and the pension scheme, which he said was the responsibility of a self contained pensions teams. He said he had probably only met the pension scheme trustees three times when he was running the company.

‘I had no responsibility for the pension scheme, and I gave no investment advice. The trustees were paying substantial fees to advisers, and I recall pension advisers being paid £650,000 in 2005/06 to something north of £1.5m. The monies paid to third party advisers grew to over £2m a year, ‘Green said.

Green said the scheme’s problems were down to a combination of poor communications on both sides, and said no advisers ever came to see him. ‘I wasn’t actively involved in the pension contributions. Maybe if I had, we wouldn’t be sitting her now, ‘he claimed.

MPs pointed out that in 2000 the BHS scheme had a £43m surplus, but that by 2006 following a period when BHS paid Green and his family a series of dividends, the scheme went into deficit. Green said: ‘That’s not very fair. I put back £750m into the company – everyone wants to ignore that. But I was not responsible for the pensions scheme.’

The select committee chair Frank Field expressed surprise, saying ‘ all our other witnesses have painted a picture of a Napoleonic figure, so we’re slightly shocked that you are telling us all these people are wrong and you don’t make the big decisions, so this terrible pensions deficit just crept up on you.’

In 2012, when BHS had a valuation based on a 23 year outlook which suggested the pension scheme had a deficit of 157m, Green agreed to pay £10m annually to plug the gap. He said he had refused to pay more, on the basis that at the time the company was  not making money and was getting loans,  and until it was in a better recovery position ‘of the funds the company was borrowing, £10m wasn’t affordable but was a minimum to be paid’.

In a tetchy series of exchanges with MPs over whether or not the funding for the scheme was adequate and whether BHS faced paying a levy to the pensions regulator, Green said: ‘With respect, you are asking me questions that are impossible for me to answer. I don't want to pass this to other people, but there has to be some responsibility on behalf of the trustees. There have been some stupid, stupid, idiotic mistakes in the pension scheme’.

Green was asked about Project Thor, on which Deloitte were advisers, which was developed during 2014 and was designed to find a solution to the BHS pension scheme which would provide an outcome for pensioners which was better than the compensation options available under the Pensions Protection Fund (PFF).  Green said he had spent ‘in excess of £1m’ in trying to develop a solution.

While the project details were ready in September 2014 Green said it required suppliers and landlords agreeing to discounts, which BHS thought they were not likely to achieve at this time. The pensions regulator then asked for the proposal to be withdrawn, although Green said his advisers asked for it to be paused.

Green was highly critical of the subsequent behaviour of the pensions regulator in March 2015, prior to the BHS sale, saying there had been a failure to engage with BHS and describing the experience as ‘hitting a brick wall’. However in the last week the regulator has phone up to arrange a meeting and there has been dialogue with advisers.

Green said he was talking to the PPF directly and wanted to find a solution for BHS’s 20,000 pensioners. He still believed money into the PPF did not resolve it, but the problem was sortable and he wanted to give an assurance he would do this. Green said Project Thor, or its successor, was currently in development.

Asked why Green was involved with the pension scheme after BHS was sold, he told MPs that it was always understood that there would be ongoing attempts to provide a solution. While the new BHS management went on to develop their own project to handle this, Green said they lacked the money to fund it.

Challenged about the decision to pause Project Thor, MPs suggested that the pensions regulator had raised questions about potential moral hazard in the BHS proposals.  One MPs quoted an email from the chair of the BHS pension trustees, which says he was unhappy that the regulator was ‘trawling through bullshit from 10 years ago’.

Green denied this, saying it was down to worries about the political situation in Ukraine and Russia and the approach of Christmas trading.

MPs said Dominic Chappell, who bought BHS for £1 via a company called Retail Acquisitions Ltd (RAL) had said Green had pledged the company would be sold ‘pensions-free’, but if Project Thor was paused this could not be the case.

An angry Green said that Project Thor was currently being updated over the past two to three weeks and was ‘about a week away’ from delivering a better outcome than the PPF deal with a ‘commonsense’ solution.

However, MPs focused on events prior to the BHS sale, quoting emails which stated that while Chappell thought the pensions gap was £50m, finance director Paul Budge said ‘of course it’s moved on since then’ and claims that Green had told Chappell if he sought a meeting with the pensions regulator, the deal would be off. 

In further discussion, Green said it was ‘inconceivable’ that he could have stopped Chappell seeing the regulator, and said   Grant Thornton’s due diligence pack prior to the BHS sale had a section on Project Thor, ‘which would not have been there if the pension scheme was not on the table, regardless of what Chappell says’.

Asking for a break in proceedings in order to regroup, Green said he had gone ‘many, many miles’ to try and keep BHS afloat, including deciding against opting for a pre-pack administration in 2014, which might have had a worse outcome for the pension scheme.

The committee session has gone into a break following a sometimes heated series of exchanges and will recommence later this morning.