West Somerset Railway General Discussion

Thanks Tom.
That’s a helpful example although it assumes that the objects of the absorbing Charity encompass those of the one it absorbs. It still involves the closure of the absorbed Charity which I believe does require CC approval.
The question still remains. How would the merger achieve the existing objects of the WSSRT?

 

I note you haven't answered my query about what in my post was defamatory. Can you either substantiate your accusation or withdraw it.

 

I have had cause to read the advice on this general topic in the last few months, considering scenarios relating to ecclesiastical charities (which have an uncomfortably broad definition) and what needs to happen if they are to merge.

It is clear from the advice published by the CofE that the Charities Commission is an interested party, and must approve any such change to a charity. However, there are well worn tracks by which this may be done, and they do not in themselves require changes to the absorbing charity, even as that which is absorbed will be dissolved. In the background, the CC have a general view that there are too many small charities, and that consolidation is a good thing, not a bad.

In the case of the WSSRT, I would expect that any such scheme of arrangement would set out how the purposes of the WSSRT would be protected within the WSRA. That is both a moral requirement - no one is arguing that the WSSRT's purposes have now ceased - and a legal one, on which would hinge the approval (or not) of the CC.

That is a fair question, and one that "the 14", if elected, would have to be able to answer effectively in order to achieve their objectives. However, the voice of this and your previous post suggest a presumption that such a move is in and of itself undesirable if precipitated by action like that of "the 14"; a view that is entirely consistent with aspects of your report. I am not so sure that I agree on that point; I firmly believe that the assertive tactics used against the X6, exploiting the law and the articles to rebalance the imbalance of power between trustees and membership, were necessary. I perceive "the 14" as acting in a similar vein in their view of the interests of the WSR as a whole, given the behaviours exhibited by the plc board over the last 18 months or so. It should be for the members to be able to decide which of these two conflicting approaches will prevail for the future of the charity they have chosen to support.

 

Which is precisely why membership organisations should not be limited to those two models as a form of structure. Another reason, to add to the ones given by @Jamessquared , why any future overarching membership organisation for the WSR should not be a charity.

 

Well, if the WSR goes belly-up, I imagine that would negatively impact the existing objectives of the WSSRT.

Noel

 

I have mixed feelings on that, as any of the organisational models I've seen include charity and/or limited companies as part of their structure. The legal constraints would remain, even if the membership organisation were the ultimate owner.

The issue is surely how to craft a structure such that there is effective membership control AND sufficient quality of management that it can be exercised with the lightest of touches. By that measure, the WSR structures have conspicuously failed, and over a sustained period.

 

The CC positively states that a merger with another charity is a valid reason to close a charity. If a charity chooses to do so they are required to notify the CC but it does not require CC approval according to their guidance. See https://www.gov.uk/guidance/how-to-close-a-charity#close-a-charity--the-law

 

Indeed; in the specific example the "adsorbing" charity had wider, but complementary, objectives than the "adsorbed", so there was a fit in that regard. I suspect that the same could be argued in the case of the WSRA and WSSRT.

Yes, but clearly the Trustees were also acting to further the objectives of their charity by winding themselves up and subsuming into a larger organisation.

That is for the prospective candidates to argue. Though if you genuinely believed that the railway (as a holistic thing, not any specific entity) was under an existential threat, then acting in a way you felt avoided that threat would clearly be in the interests of the charity. After all, if the WSR ceases to exist, how does the WSSRT deliver its objectives related to museums or heritage carriage restoration?

I'd also pose a question to you: if the stated aim of the WSSRT is that it wishes to concentrate just on those activities, how does holding a significant shareholding in the plc advance those objects?

I'm actually broadly neutral on whether a merger or not is ideal, or whether a new charity is the best option. What I am clear on though is that the mass-membership body should have primacy in governance: the role of the operating company then being to deliver the ambitions of the members as well as possible within the regulatory and financial constraints. The current structure has a body with I believe ~ 50 members, give or take, having an effective veto over a body with many thousands; and seems to assert that a possibly untraceable shareholder who invested £5 forty years ago has an equivalent stake to a member who pays far more than that annually.

Tom

 

Blimey Martin, Winchester & Alton (my bold) is a step into the past! Any one who's encountered the Chairman of the MHR will know he doesn't do nonsense or flannel (unlike, sadly, some of his predecessors).
Pat

 

A Chairman accused of defending the indefensible and protecting a fiefdom is a an allegation which I suspect you might find hard to justify.

 

I didn't make that statement. That was someone else.

 

Many moons ago @Jamessquared explained the set-up on the Bluebell, which didn't have a charity as the overarching organisation. Whether or not it is because of this that the Bluebell has avoided the troubles of the WSR is impossible to tell, but it certainly shows that such a set-up can be made to work very successfully. John Bailey, on the other hand, is pushing the setup on his home railway, which of course he knows best, all its pros and cons. However, that shouldn't mean that other structures should not also be considered, especially given the lack of any direct democracy in the charity model, something that I am sure that many people see as one of its main features.

 

I apologise profusely! It’s probably my fault in failing to ensure that I replied to the correct posting.
It doesn’t alter my view that the relevant posting was ill advised but absolutely no criticism of you is intended and I hope people will interpret thread accordingly.

 

Whilst I accept that @Lineisclear is privy to information I am not, and clearly has a far greater grasp of all things legal, I struggle to see how the 14, or whatever the number now is can be accused of doing anything underhand or questionable in standing for election.

They are all members, and therefore entitled to put themselves forward under the constitution of the charity.

They complied with the timetable and procedures, and, above all, were entirely open about their motivation for standing.

This last point seems crucial. It is apparently the reason they are are being villified and questioned.

Would it have been better for them to stand without revealing their motives, then spring them on the charity later - always assuming they are elected?

This last point is also crucial, because if the majority of Trust members disagree with them, they will not be elected. And if they agree, it shows that the current board are out of touch with their members.

A further point on ringfencing appeals should the charities merge, or a single one be created.

I donated to the CVR today following the S&T theft and their website was a model of clarity.

I could choose to make a general donation to the railway, or to the ReconnectLeek fund or select from a drop down list of half a dozen specific schemes.

Would such a arrangement would be an option to ensure the schemes of the current charities retain the ability to effectively raise their own funds for pet projects?

 

Absolutely right but am I not allowed to express an opinion on here?

 

No problem. These things happen.

 

Picking up on the conversation now. I agree with @Jamessquared that the objects of the new charity could comfortably accommodate WSST activities.

to give an example if the charities did merge then restricted funds would remain thus eg the 70k held for the sleeping car would have to be applied for that purpose only.

the whole point about the merger is a “whole railway” policy. The railway should be asking “to what extent the museum activities of the WSST should take precedence over other important funding requirements. After all having a museum is great but little point if the railway struggles for engines/carriages etc.

That surely is the while point of the merger ; one democratic charity body raising funds as opposed to two. Take out any element of competition. Museum specific grants can still be sought as part of the overall charity activities and indeed there could be a trustee with this specific remit.

Regards

Matt

 

Exactly. I should certainly think it advantageous if in the new merged body there was a trustee with responsibility for the heritage carriages, one for the museums, one for educational stuff etc. That would be an obvious way to show commitment to the existing objectives of the WSSRT. Re-writing charitable objectives if necessary is hardly unheard of as well, I'm sure the CC would be happy to allow that if it meant a successful merger and one less charity, which they are apparently keen on.

 

Having looked at the object clauses for both organisations they are absurdly similar and clearly a merger (or subsumation realistically) would be possible and I see no reason why Commission approval would be necessary given the relevant clauses of the WSSRT Articles of Association.

It is worth noting that the principle duty of charity trustees is to promote the objects, and if that can best be achieved by being subsumed by another organisation then there is a strong argument that they should do so.

I make no comment as to whether merging would be the best way of achieving the objects, and as I said a few days ago I don't think that the plan of the '14' is the best way of achieving their ultimate aim, but from a lawyer's perspective (and I must make clear that I am not giving legal advice here - just offering an opinion!) the existence of two charities with basically the same objects on the same railway does seem rather odd - any sensibly run 'one railway' would merge the two organisations.

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