Pension money missing at Budge

A pounds 1m shortfall in the pension fund has been uncovered at A F Budge, the collapsed construction group once run by the flamboyant brothers Tony and Richard Budge. Richard, who this week unveiled plans to float his RJB Mining group, is also in dispute with Budge's pension trustees over the transfer of pounds 1.1m to his new company's pension scheme.

In February 1992, Richard led a management buyout of Budge's mining interests - accounting for half the company's pounds 218m turnover - leaving Tony with the construction businesses. A F Budge collapsed 10 months later, when banks and investors failed to agree a refinancing. It was brought to its knees by the property recession and its exposure to a troubled Docklands office investment. Other Budge interests left in the hands of receivers included a Scud missile launcher and a small gold-mine in Arizona.

A F Budge should have paid pounds 1m into its pension scheme three months before the collapse. However, Andrew Turnbull, a trustee, did not know why there was a shortfall. One reason may be a lack of cash. The fund owns an office block in Leeds which Mr Turnbull is trying to sell to ensure there are enough assets to cover the scheme, which has about 600 members.

Tony Budge, a racehorse owner and member of the Jockey Club, was once listed among the UK's 200 richest men. He is believed to have fallen out with his brother, a successful racing driver, over Budge's expansion into property.

So far, about pounds 2m in pension money has been switched from A F Budge to the employees' new scheme at RJB. But a further pounds 1.1m that should have been paid on 15 December was not. RJB's flotation offer document says the company pays pounds 75,000 a year to the personal pension of Richard, aged 47.