Poundland

Wednesday 4th November 2026 Lords Chamber

Commons Urgent Question

11:50

The following Answer to an Urgent Question was given in the House of Commons on Monday 2 November.

“I am deeply concerned about the uncertainty surrounding Poundland’s future, and the impact that could have on its thousands of staff and their families, who are at the forefront of my mind, especially in the run-up to Christmas. Poundland is not currently in administration and the business continues to trade, but this is a worrying time for employees, suppliers and communities. We are establishing the facts, keeping in close contact with those involved and monitoring developments closely.

The Secretary of State and I continue to engage closely on this issue. We have met, and are in ongoing contact with, the trade union USDAW, which I know is extremely concerned about the jobs and livelihoods of its members, and I thank it for its work and engagement. We will be meeting Barry Williams, the managing director of Poundland, this week. Earlier this week, officials met Gordon Brothers, and the Secretary of State is due to meet it to continue to press our concerns and establish the facts. However, there are ongoing commercial negotiations concerning this private business, and it would not be appropriate for the Government to seek to influence the outcome or comment on the merits of individual bids.

The owners should act in the best interests of their loyal UK staff and stores. We want the best possible outcome for Poundland’s workforce and the future of the business. The 12,000 staff and many thousands of suppliers are at the forefront of our minds, and we want to see an outcome that protects as many jobs as possible and keeps as much of the business trading as possible. The Government stand ready to ensure that affected employees can access the appropriate support, should it be needed.

The Prime Minister has set out his aspiration to bring good growth to every postcode, including by making high streets a new symbol of Britain’s renaissance. Last week, the Government published our high streets strategy, which goes further and sets out the principles for high street success, practical support for businesses with the business rates system, and more policies to support vibrancy and footfall. That includes establishing a ‘high streets first’ principle to ensure that public estate locations drive footfall and opportunities to co-locate public services.

The fundamentals for doing business in the UK are strong. Our economic strategy to deliver growth is investment across the public and private sectors and in every postcode. Our industrial strategy, trade strategy, small business strategy and plan to make work pay address long-standing barriers to growth. Retail is vital to employment and the economy, and we recognise that the sector has been through a significant period of change. We want all types of retail to thrive, now and in the future, so we are working closely with businesses to understand what they need to succeed and grow. The Minister for Employment and I are providing a briefing for Members of Parliament in this House this afternoon on the support available to employees who may be impacted.

I want to emphasise that in the event that a retail company enters administration, my officials will work, where appropriate, with the administrators, the Department for Work and Pensions, the Insolvency Service and local partners to ensure that appropriate support is available to affected employees. We stand ready to support them if they need to move into new employment. However, our priority is always protecting jobs, and the Secretary of State and I will continue to engage with the company to secure the best possible outcome”.

[Lord Sharpe of Epsom (Con)]

My Lords, our thoughts are with those 12,000 Poundland workers and all those in the Poundland supply chain, who are facing an anxious Christmas.

However, only last week the Chancellor had the perfect opportunity in his Budget to reverse £25 billion in employer and national insurance contributions, to cut the most damaging regulations in the Employment Rights Act, to tackle some of the highest industrial electricity prices in the developed world and to reform a business rates regime that is crushing the high street. Instead, he chose to make a bad situation worse. According to a new report, since 2024 the cost of employing a worker on minimum wage has increased by £4,462. For an 18 to 20 year-old, the cost has increased by £4,859. That is double the rate of inflation. Is it any wonder that we have a NEETs crisis? It is sad to say, but Poundland will not be the last. When will the Government get a grip and cut the taxes and regulations that are driving businesses to the wall?

[The Parliamentary Under-Secretary of State, Department for Business and Trade (Lord Leong) (Lab)]

My Lords, I thank the noble Lord for coming in to ask this question despite having a very heavy cold. I wish him a speedy recovery.

Poundland stores remain open, but I know how worrying the uncertainty is for the 12,000 workers, their families and the wider supply chain. Gordon Brothers cites inflation and shoplifting, yet Poundland sales have grown and private buyers have come forward. Therefore, the owner needs to explain what is holding up the sale of the company. For the wider high street, the Budget will take around 70,000 more retail, hospitality and leisure businesses in England out of business rates from April 2027. We are committing £210 million to the community assets programmes, supporting local communities to reimagine and revive the struggling high streets.

[Lord Fox (LD)]

My Lords, in the 1970s Prime Minister Edward Heath coined the phrase the “unacceptable face of capitalism”; if Gordon Brothers turns its back on the acquisition, closes Poundland and lets these important jobs go, that will be unacceptable. Therefore, I am a bit confused by the Minister’s response yesterday in the Commons. She seemed to be clear when she said that the Government would not

“sit by and do nothing”.

That would be clear, had she not said in the previous paragraph:

“We are not interfering with the auction. There are ongoing commercial negotiations about this private business, and we do not want to impede or influence that process”.—[Official Report, Commons, 3/11/26; cols. 729-30.]


Can the Minister clear things up? Which of these are the Government not doing?

[Lord Leong (Lab)]

Currently, the Government are not going to intervene in the ongoing commercial negotiations regarding a private business. It would not be appropriate for the Government to intervene right now. We really need to wait and see what happens after the negotiations. Let us remember that Poundland is currently trading, it has appointed an administrator and there is creditor protection for 10 days, which expires next week. Under such terms, we want to see the negotiations carry on. However, the Government nevertheless want all viable options that are capable of protecting jobs and supporting a sustainable future for Poundland to be properly considered.

[Lord McTague (Lab)]

My Lords, it is clear that many small businesses are being pestered by Poundland to continue to supply to it even though their invoices have not been paid. Can my noble friend the Minister please give them some advice? How should they respond to that request?

[Lord Leong (Lab)]

I thank my noble friend for that very important point. For a small supplier, one unpaid invoice can mean struggling to pay its monthly payroll. Suppliers need to know when invoices will be paid and on what terms they are being asked to send more stock. I would advise all suppliers to look at the terms of supply and see whether they have a Romalpa clause in the invoice, meaning that the title does not pass until the payment is made. We are pressing Poundland’s owner to explain how Poundland will protect suppliers as well as staff. The Home and Gift Association has an open register where suppliers can record their exposure.

[Lord Harper (Con)]

My Lords, I take the Minister back to the situation that was raised by my noble friend on the Front Bench—the wider trading conditions. In its report ahead of the Budget, the OBR made it clear that unemployment would rise in the next year and that the costs from the Employment Rights Act were very significant. These came on top of the very significant national insurance rises. Those were all factors in pushing up unemployment and all under the control of the Government. What are the Government going to do to improve the wider trading conditions for the retail sector?

[Lord Leong (Lab)]

As I explained earlier, regarding Poundland we need to look at not only national insurance but other employment costs. However, looking at the history of Poundland, there was a restructuring High Court hearing in 2025, at which the court said that Poundland was in financial distress. This has been ongoing for some time. The Government mentioned in the Budget that they are taking every step to support businesses, high streets and small businesses, and we are committed to doing so.

[Baroness Wheatcroft (CB)]

My Lords, Poundland is owned by Gordon Brothers, which in turn is owned by Stone Point Capital. These companies are effectively private equity organisations and, as is so often the case, they load companies that they purchase with debt that cannot be serviced. Does the Minister agree that this is the essential problem at Poundland?

[Lord Leong (Lab)]

My Lords, I have I spent my working life building businesses and I support all forms of capital to help businesses to grow in scale. I recognise that there have been questions about Poundland, but our immediate priority is to establish the facts and support Poundland’s workforce. If incidents and wider questions such as the noble Baroness says do emerge from this case, of course we will consider them carefully.

[Lord Sikka (Lab)]

My Lords, private equity has devoured town centres for years. Can I urge the Government to do two things? First, can they abolish the tax relief on interest payments for corporations—a process begun with the Finance Act 2017 by the party opposite. Secondly, can they appoint worker-elected directors on the boards of large companies? If the Minister finds these suggestions too radical, can he make his own?

[Lord Leong (Lab)]

I always find my noble friend’s questions, which are sometimes very challenging questions, quite interesting. On his point about interest, the Government’s position stays as it is. Regarding directors on boards, we can have ongoing conversations, but there are no immediate plans for this.

[Lord Redwood (Con)]

Will the Government rule out specific Poundland subsidy or nationalisation as a solution?

[Lord Leong (Lab)]

The answer is no.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, does the Minister share my concern that chief executives get rises of often more than what their workers get paid in a year and very rich Tories opposite blame a lot of the problems on paying the poorest the minimum wage?

[Lord Leong (Lab)]

My noble friend has a point when it comes to the minimum wage. The Government support the minimum wage. As far as directors’ remuneration, it is entirely up to the company to decide how much it pays its directors.

[The Earl of Effingham (Con)]

My Lords, how can this Government credibly claim to champion the high street while at the same increasing employers’ national insurance and business rates?

[Lord Leong (Lab)]

There are so many ways in which one can answer that question. I refer the noble Earl to my previous answer to his noble friend.

[Lord Leigh of Hurley (Con)]

My Lords, I take the point from the noble Baroness, Lady Wheatcroft, that private equity does typically put debt into businesses. Sometimes that works and sometimes it does not. In this instance, capital has been put into Poundland. When the last restructuring happened, it was going into financial difficulties in any event. But the point remains: does the Minister think that this business has benefited from more tax and regulation, or would it benefit from less tax and regulation?

[Lord Leong (Lab)]

I have tried many times and in different ways to address the point about additional employment costs and tax. As far as Poundland is concerned, there are still ongoing negotiations about a possible sale. Until such time as that happens, the Government will work with Poundland and the owners to try to get a sale going.