Lynton and Barnstaple - Operations and Development

OSHI is doing very well, very busy, except for getting new staff which is an industry wide problem at the moment.

 

Hi Keith what I have suggested is no different to the FR setting up the WHR Construction Company or the KESR having the Rother Valley Railway Company to rebuild part of their lines.

Ultimately this company would disappear once the railway has been built and I would suggest that the direction of the construction company was given over to a Project Engineer who would be appointed by the CIC directors who are in turn elected by the members.

I do find it hard that all I have suggested is to use the same model that has already been in place by other railway projects.

 

Colin, would it not be much simpler and cheaper for the CIC to employ said Project Manager, avoiding the overhead of setting up and managing a separate company? In construction projects, it is normal to employ separate sub-contractors for specific tasks, so no major employment would be necessary - just a good Project Manager and a supporting team to run with the plan - much of which already exists. No need to add even more complexity to an already complex project, IMHO.

 

And, in any case, the corporate structure should then follow the intended purpose of the work, as is most advantageous for that project.

Those are questions that follow agreeing how the project will be implemented, not that form the basis for decision making.

I’d make no assumptions about the RVR being the right structure for the L&B, simply because it has such a different genesis.


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Great, I *really* hope it succeeds. But the time to judge that is next February, not now.

 

Hi Martyn, you may well be right the big problem at the moment is that just a few people want to run the whole show and as has been seen this has failed big time, as for the construction company there used to be a tax break on construction projects, but I am not sure if that is still the case, If it is then the railway also needs to take full advantage of the situation

I have come across this

What is the Super Deduction?
Under the new scheme, expenditure incurred from 1 April 2021 until the end of March 2023 is eligible for 130% capital allowances on qualifying plant and machinery investments. This means that for every pound a company invests, their taxes are cut by up to 25p.

For example, if a construction firm spends £100,000 on a new fleet of forklift trucks, the corporation tax deduction will be £130,000, giving corporation tax relief at 19 per cent on £130,000, which is £24,700.

It’s important to note that the tax break is only available for limited companies*, not sole traders or partnerships.

What kind of equipment qualifies for the Super Deduction?
A broad range of plant, machinery and other assets are eligible for the SDT. But while vehicles such as construction site plant, trucks and vans are included, ordinary cars do not qualify, as they are not treated as ‘main pool’ plant and machinery for capital allowance purposes.

Pre-owned goods are also excluded. To qualify, assets must be purchased brand new from 1 April 2021 and not second-hand.

Latest government guidance for eligible assets includes:

• Solar panels
• Computer equipment and servers
• Tractors, lorries, vans
• Ladders, drills, cranes
• Office chairs and desks
• Electric vehicle charging points
• Refrigeration units
• Compressors
• Foundry equipment

However, the government stresses that this is not an exhaustive list. Seek professional guidance from a tax expert to establish whether a purchase you are considering might qualify for the new level of tax relief.

* I am not sure if a CIC would quailify for this tax break so a sub company would be required.

So say if the L&BR CIC were to buy a new deisel loco from say some one likes Keefs, that could be subject to super deductions, so as I say I only know that it is possible and I am not a tax expert but not only do we need to make sure that we have the right people we also need to make sure we have access to the sort of information that can give us any sort of advantage in the construction process of the railway

 

I'm not sure that many other railways have set up separate companies to build their extensions, I think the RVR and WHR are the exceptions rather than the rule.
I think in all these cases the questions should be asked "can this function be performed within an existing company/structure?" and "can this function be performed by a volunteer instead of employing someone?"

 

I'd check the end date if I were you.

But more seriously, we are way, way, off that level of detail in the planning. If such concessions are available when the L&B is ready to consider spending serious money, then the value of those tax advantages needs to be looked at - saving £24.7k would be great. But only if that money is a genuine saving, and not distracting from something else more urgent/important.

 

With special emphasis on "can this function be performed by a volunteer instead of employing someone". The cost of employing someone is not just the wagebill, but also the allocation of that wagebill to that role for the foreseeable future.

 

The super deduction section is now irrelevant - I'm not sure why you even posted it!

 

Hi Paul in my working life in both the Construction and Maintenance industries, I have been aware of certain tax breaks for the construction industry, I would guess that with the Governments levelling up programme, tax is yet another area that we need to be exploring.

But as far as I am aware do we have anyone on board with a tax background? possiblity not.

 

I went to visit it after the EA meeting a month ago, and took pictures. Just to see what I had helped to buy. Had lunch there, helped by a 10% voucher they were giving out at WB. Seemed to work OK.
I'll do a little story on my Heritage Herald blog in the near future.

 

Ok so it might be, but it may well have been replaced with something else, but again I am not a tax expert

 

That's what professional advisors can be for. My wife qualified as a chartered accountant but has been out of practice for 18 years; I'd no more lean on her for expert advice than I would on someone who'd been retired half as long, as expertise soon lapses - as she is quick to remind me. That's before you consider that tax is a specialism within accountancy, where wise accountants know their limits and seek expert advice. The same issues will be true of other professions.

The issue is not whether there is Joe Bloggs on the board with that specific expertise, but whether the organisation (a) has access to that expertise and (b) the wisdom and nous to take advantage of it when forming the overall plan. That requires a board with an open and enquiring mind, willing to explore and test advice when reaching it's decisions. And, unfortunately, all of the current noise is not about whether the L&BRT board has relevant expertise or advice, but how the trustees are acting as a board to make the necessary decisions. The consultation on options in March is a case in point - it's a board sticking with it's prior plans, and defending them, not one reflecting on the implications of a decision and considering (difficult) options.

 

Whether a special vehicle company for the purpose of constructing the railway is required is frankly a detail at this point. A detail I sincerely wish was worth even a moment of consideration. But it isn’t.

 

And will anyone but a direct LBBC shareholder get to know ? Presumably all that will show in the L&BR Trust accounts will be the income from any dividends that are paid, which will be some indication. I am hoping someone will tell me I am wrong about that. I am not sure it has been declared how much was paid for the business - will a figure for the property be separate and come up on the land registry ?

 

I'll really look forward to that, Jo.
Frankly, with the exception of Trackbed Trails, your Heritage Herald blogs are about the best source of L&B news out there. Ironic really, considering that you're based on another railway entirely.

 

Thank you

OSHI was quite a large site, but I don't know just how much of it was included in the sale. I also got some gen from talking to people at WB.
I looked round OSHI, also round Barnstaple (with pictures) to see what happened around and after Pilton yard, and have pictures of the derelict Chelfham school. I will report on those three items, but the last one will have to wait for the blog as I don't want to make an appeal for funds on a GWSR blog at the same time as one is running for the viaduct. I think they are still well short. The Chelfham school appeal is very interesting, but for the GWSR's sake I need to hold back a while. It's only fair.
I did send a Chelfham contribution toot sweet, and I encourage you to do the same, it's a unique opportunity. On the other hand, if we don't, it's a threat, so we need to act. Many hands make light work. You get gift aid now too. Check out the YVT website: https://yvt.org.uk/support-us/chelfham-mill-appeal/
The site has been trashed by vandals and 'urban explorers', and the main admin building (made of concrete blocks) set on fire, so it's now on at a reduced rate. The historic buildings are still good though.

 

The Trust - and therefore the Trust Members - have a large shareholding in OSHI (both the controlling A shares and the generally available B shares).

Whether it is strictly required or not - opinions will differ - it would seem to me to be good practice and a way to bolster openness and trust that is in such short supply at the moment for the Trust members to get the same information as the B shareholders as the Trust members effectively are B shareholders, and if the pub were to go bust, there would be considerable impacts on the Trust's position. Similarly, if the plan is to pay off the loans and slowly buy out the shareholders, then Members will probably have a view on that, given that it will cost money that could be spent on other things.

What's not sustainable is the information black hole that currently exists, but that's true for so much of the Trust's current issues.

 

With one trustee stating twice at the AGM that due to the 'work' he has done if the members want to do something other than the option that the board want to follow then he wont be a part of it