Thousands of jobs are at risk at retailer Toys R Us as a pensions gap threatens to tip it into administration before Christmas.

The beleaguered US-owned company has already applied for bankruptcy protection in America and revealed proposals to close 26 UK stores.

However, for the Pension Protection Fund (PPF) to agree to the plans for a company voluntary arrangement (CVA), which would allow the business to continue trading, Toys R Us will have to pay £9m within two months towards a £25m to £30m black hole in its pension scheme by Thursday.

Toys R Us is understood to be unable to pay the cash, with bankruptcy proceedings in the US preventing its parent from acting.

Should it fail to make an agreement with the pensions lifeboat, the company will be forced into administration which could lead to 3,200 jobs being lost, including at Norwich and Ipswich stores.

The Ipswich store was named in the tier of top-performing shops, while Norwich was in the third of five groups, meaning it needed to secure a rent reduction of at least 35% within seven months of a CVA or face closure. CVAs allow businesses with debt problems to make an agreement with creditors over the repayment of some or all of their debt.

Malcolm Weir, director of restructuring and insolvency at the PPF, said it was working closely with pension scheme trustees.

'We have yet to decide how the creditor rights will be exercised in the CVA vote. We are seeking to fully understand the current position of the company, including its future potential, position of the US parent and the reported historic financial transactions.

'The pension scheme is already underfunded and, if we were to vote in favour of the CVA, we would need actions taken that ensure the position of the pension scheme was not going to further weaken.'

He said the CVA filing had triggered an automatic assessment for the pension scheme, adding: 'Whatever the outcome of the CVA the pension scheme members can be reassured that they remain protected.'

It is understood that talks can continue between the PPF and Toys R Us after the proxy vote deadline, midday on Tuesday, up until Thursday's CVA decision.

The PPF's tough stance comes after heavy criticism for failing to better protect pensioners at BHS.