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West Somerset Railway General Discussion

Discussion in 'Heritage Railways & Centres in the UK' started by gwr4090, Nov 15, 2007.

  1. Hemerdon

    Hemerdon Member Friend

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    You seem to be criticising the post and then agreeing with the content. Is jma1009 involved in running the railway? Please don’t tar everyone with the same brush because of a few unconstructive and bitter posts.
     
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  2. Lplus

    Lplus Member

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    Absolutely - as least they appear to be the only organisation on the WSR with a shred of remaining moral rectitude...

    Implicate them in the Washford situation? I don't think so. They may not have reacted against the actions of the Plc but the Washford debacle seems to me to be the result of a venomous fit of pique following the failure to extract additional money from the SDRT.

    And if that isn't seen as "constructive comment" - well, tough.
     
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  3. johnofwessex

    johnofwessex Part of the furniture

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    I do not propose to go on about this matter, but I will say it once

    The WSRA & the WSSRT between them hold sufficient shares in the PLC if not to exert absolute control, to at least have some influence on the PLC board. Something that appears not to have happened for some time.

    The PLC's behaviour towards the S&DRT, in particular the press releases brought the WSR into disrepute, and more importantly as the COVID situation developed there is a question to be asked about the impact it had on fund raising.

    Then of course there is the Seaward Way level crossing..........

    As shareholders in the PLC & as organisations supporting the WSR, I suggest that the WSRA & WSSRT have some responsibility for the 'Good Governance' of the line so, in my view should have expressed an opinion on the matter, and at least indicated that they had done so. Any public comments clearly should be carefully worded even if the private communications are more forceful.

    To date however I am not aware that any such discussions have occurred, which suggests a serious failure of governance by the two organisations, and may well be a contributory factor if the WSR either does not reopen in 2021 or fails to make it through 2021.
     
  4. gios

    gios Member

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    The disgraceful treatment of the S&DRT was an unforgivable and self defeating act which remains a stain on the WSR and should never be forgotten.

    As George Orwell so succinctly put it: " In a time of universal deceit - telling the truth is a revolutionary act".
     
  5. rodders154

    rodders154 Member

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    Whilst I dont agree with this post What has the DEPG or the friends groups done to garner your distrust?
     
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  6. Lplus

    Lplus Member

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    Good point - My apologies to the DEPG and friends groups.
     
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  7. Monkey Magic

    Monkey Magic Part of the furniture

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    Silence is complicity.

    Could have, should have, didn't.

    And spare me all the 'oh but we tried behind closed doors' the reality is that even if they did try, they failed miserably to protect another member of the WSR family. Why? Well, only those who did nothing, or those who chose to support the PLC know their motives for doing so. But I am sure people can draw their own conclusions as to the reasons why people on the WSR have chosen to do the things they have done.

    That said at least the S&DRT has been able to move on and has a bright future, which is more than can be said for the rest of the WSR.
     
  8. jnc

    jnc Well-Known Member

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    I've yet to see a more viable explanation. (Especially given the announced extended lease on Washford yard.)

    The WSR might want to examine their own lease from the SCC pretty carefully, to make sure the cash-strapped SCC can't adopt the same rules there. I'm still mildly surprised that the SCC didn't find some way of wriggling out of paying for the replacement level crossing; I'm sure they could justify it to the public by saying the money was going to be spent on a more worthy cause (e.g. medical care for the elderly).

    Noel
     
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  9. Bayard

    Bayard Part of the furniture

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    No, it means that Mike could call an EGM of the WSRA.... Clue: the Plc has shareholders, not members.
     
  10. Bayard

    Bayard Part of the furniture

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    That's an interesting point. Whereas individual shareholders do not have such a responsibility, beyond wanting to see that the company that they own a part of is well run, the charities hold their shares as part of their charitable objectives and, as far as I know, do not just own them following a desire to put money into the company. They are not getting a monetary return from them, so why are they, as a charity, allowed to hold them and does this place any responsibility on them vis a vis the governance of the company they own a part of? Perhaps one of our resident lawyers would like to comment. It does seem to me that the grounds for charities owning valueless, non-dividend-paying shares are pretty shaky in the first place. After all, it is no secret that many, if not most, of these shares were acquired for the sole purpose of funding the Plc.
     
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  11. Lineisclear

    Lineisclear Member

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    It is a very interesting question which I have asked myself previously. I believe it depends on the rules governing Investments by Charity Trustees. Yes I realise they are not putting investment cash in at the moment, and some of the shares are inherited , but they are choosing to hold them and that surely amounts to a continued investment. It would not be legitimate for the charities to hold shares in a company that could declare dividends ( that would involve tax privileged charity money being used to support private gain). Fortunately the PLC Articles were changed to exclude dividends.
    The acid test is whether the investment can be justified as helping the charities achieve their respective limited charitable objectives neither of which include operation of the railway.
     
  12. martin1656

    martin1656 Resident of Nat Pres Friend

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    When a charity hold a certain amount of shares in the operating company, its often as a way to ensure members control the direction of the operating company, and its a safe guard from a hostile take over by anyone who may have ideals not in the keeping of the membership of the railway, that's why often, the supporting charity, will be the majority stakeholder in the operating company, it also serves as a way to hold the company to account, should the management forget they are the servants of the railway, not the owners.
     
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  13. 35B

    35B Resident of Nat Pres

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    Looking at the Articles of both organisations, I don't think overmuch creativity is required to argue that a donated shareholding in the plc is in pursuance of helping to ensure those objects. Given the way that they have been acquired, and their lack of investment value, it doesn't seem much of a stretch to treat the shareholdings as supporting either:
    or
    The more interesting question with restructuring in mind is whether the shareholdings will be a blessing or a curse.
     
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  14. Bayard

    Bayard Part of the furniture

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    Ah, I had supposed that charities could hold dividend-bearing shares as a way of an investment of their cash assets to produce a return that could be used to further their charitable objectives and it was the holding of shares that produced no return that was dubious, because of the reasons for their acquisition. One lives and learns.
     
  15. cav1975

    cav1975 Member

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    I suspect that you might be in error there John.

    There is guidance here which seesm to permit many and varied investments:-

    https://www.gov.uk/government/publi...s-and-investment-matters-a-guide-for-trustees

    In section 5 it states:-

    5.1 What can a charity invest in?
    The short answer (legal requirement)
    Trustees can make financial investments in any asset that is specifically intended to maintain and increase its value and/or produce a financial return.

    Trustees must also be clear about the difference between investment and trading (see 5.2 and Legal underpinning: charities and investment matters (part 1)

    In more detail
    Trustees can invest in any type of investment while following the principles set out in this guidance. Possible types of investment include:

    • interest bearing cash deposits in bank or building society accounts (see section 9)

    • shares in a listed company (listed equities)

    • interest bearing loans to a company or the government (bonds or gilts)

    • buildings or land

    • common investment funds and other collective investment schemes (see 5.3)

    • non traded equity in private companies

    • hedge funds

    • commodities

    • derivatives
     
  16. Jamessquared

    Jamessquared Nat Pres stalwart

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    Are you sure that Charities cannot hold investments in companies that declare dividends? The guidance rather suggests the opposite: a charity can make an investment with the intention of making an investment return, so as to use the money generated to further the charitable objectives. If they do so, they must have a governance structure for making such investments in a prudent way.

    See https://www.gov.uk/government/publi...s-and-investment-matters-a-guide-for-trustees

    Alternatively, they can invest to create a holding in a way they feel furthers the charitable aims. For educational charities such as the WSRA and WSSRT, they might perceive that the demonstration of historic machinery and operational practice is educational, and therefore such investment in the plc so as to further those objectives is appropriate. That might mean, for example, that they would use the shareholding to resist moves away from traditional / heritage practice which the company may wish to make on cost saving grounds.

    The problematic bit for me is the stated intention of the WSSRT that it wishes to have no part in the future governance of the railway. At which point, it's own investment is problematic, since it can clearly not provide an investment return, but - by marking a withdrawal from any overt role in the governance of the WSR - neither can the trustees use their shareholding to direct the plc to act in a way that furthers the educational aims of the charity. That appears problematic to me.

    Tom
     
    Last edited: Nov 24, 2020
  17. 35B

    35B Resident of Nat Pres

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    I hadn't read that guidance. Isn't the kernel of the issue that, if the WSR plc were legally able to pay a dividend, an investment by a WSR related charity would be caught between being a financial investment (of probably low or no financial value considered as a financial investment), and being in pursuit of the charity's objects?

    Either way, my concern is that a legal technicality is distracting from the fundamental question of what are these organisations for, now and in a "post Bailey" future? That surely has to drive how WSRA and WSSRT act in future in pursuit of their respective - and different - charitable purposes, in a world in which the WSR can be expected to go through a fundamental corporate restructuring. The question of the independent future of WSSRT now being settled, this member of WSSRT will be considering his continued membership, and AGM votes, based on how the trustees/directors of WSSRT pursue their independent vision; @aldfort has been admirably clear about the process that WSRA are going through, and the role that members have in that consultation.

    More immediately importantly, we should focus on three things:
    1. following the government's announcements today, how the WSR can make a commercial success of it's Santa operation;
    2. how the grants given to the WSR plc are spent effectively over the next 4 months to support the railway's recovery from Covid; and
    3. how the railway steps back into full operation in the spring, especially given that the Seaward Way crossing replacement appears unlikely to be completed before the spring operating season.
     
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  18. Lineisclear

    Lineisclear Member

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    All fair points. At the risk of boring the hell out of the non lawyers those not of a nervous disposition might look at the paper appended to the Charity Commission guidance on Charity Investments entitled "Legal Underpinnings Charities and Investment Matters CC14".
    To quote from paragraph 5.18 of that august document which applies to "Programme Related Investement" of the type the charities hold in the PLC:

    "Where the non charity company is not owned or controlled by the charity it is only likely to be possible for the trustees to invest in the equity capital of such a company as a way of furthering their purposes in exceptional circumstances. These circumstances are only likely to arise where there is a correlation between the social purposes of the non charitable company and the charity's aims."
     
  19. nanstallon

    nanstallon Well-Known Member

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    Quite so, you won't catch me joining either.
     
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  20. nanstallon

    nanstallon Well-Known Member

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    All that is needed for evil to triumph is that good people do nothing.
     
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