WSRA Trustee Election Hustings

There is a certain circularity in this (and the other) thread! I remember asking the question "what is the WSRA for?" almost exactly a year ago (see https://www.national-preservation.c...ailway-developments.11128/page-22#post-620615) and we don't seem to be much nearer an answer! That question, incidentally, was posed then (and still is now) not so much in terms of "there is no point to the WSRA" so much as "if the WSRA has a confused mission, no wonder there are tensions with other bodies".

Broadly I'm with 21B on the need to have a commercial body to run the railway, and another body to wrap up the charitable / membership aspects. Where I might differ is that I'm not 100% confident that you can put the charitable and membership aspects in one body, while also having that body invested (via shares) in the commercial body. That feels a bit like sailing too close to the wind given that effectively it is known that the shareholding investment would never produce a dividend: it feels to me like it would be hard for the charity trustees to make a convincing case that investing in a company with no hope of a dividend represents prudent use of their money. Which on the Bluebell at least is why the Society (membership body, not a charity, majority owner of the PLC through shareholding) is separate from Trust (a charity, but with charitable objectives to support the preservation of the railway and associated artefacts). However, clearly that is the situation at the moment with the WSRA (10% of the shares in the plc, so I believe) and I would defer to those with more knowledge of relevant charity and company law as to whether both roles could be combined in a single body.

What is clearly a nonsense is to have so many bodies with confusing purpose. Ignoring for the moment the DEPG and S&DRT, you still have two bodies involved in commercial activity (PLC and WSRA); two that are charities and can reclaim gift aid (WSSRT and WSRA); two that are membership bodies (WSRA and FoWSR, plus of course the individual shareholders in the plc); two that claim to help "support" projects around the railway that wouldn't naturally get funded by the PLC (FoWSR and WSRA), as well as individual "Friends of..." groups for each station that presumably all have their own overheads in terms of structures, accounting, audit etc when all of them could just as easily be managed as a simple restricted fund under a single charity umbrella. In short, a mess!

Finally, I'd say a single strategy for the railway, setting out the long-term objectives and how they can best be delivered (using the resources of all the various bodies to best effect) is a must. Robin gave an interesting anecdote about the near-duplicate purchase of a shunter simply because two bodies independently tried to fill a known requirement without any consultation. Once the operational requirement for a BL pilot was identified (presumably by the PLC as the body responsible for operations), surely it is not beyond the wit of man to ensure that only one body is charged with delivering that objective! There, in a microcosm, was the freehold saga played out all over again, fortunately it seems to much lower financial damage. Which backs up Bean-counter's point that essentially the freehold saga is a symptom of the problem, not the cause. That problem is a simple lack of clarity about who does what - agreed by all parties, and trusted by all.

Tom (off to be Sheffield Park pilot this weekend...)

 

Given the clear position that both WSRplc and WSRA own assets, I am surprised and perhaps, to the extent I have any right to be (i.e. very little) somewhat disappointed that there seems to be a number of those involved with the West Somerset Railway who see "contribution to the railway" purely in terms "how much money has X given the PLC". Different parts of the organisation can contribute in different ways, provide different aspects of the overall West Somerset Railway and have different restrictions and parameters under which they operate.

As a Charity, the WSRA has to operate within its Charitable aims or through its trading subsidiary to support, usually financially, those aims. I was surprised and slightly disturbed to find no mention of the West Somerset Railway (i.e. the Minehead to Norton Fitzwarren line) in the Objects Clause of the WSRA. I would be surprised if that were really not possible within what is required to be a Charity. The NYMHRT's Objects clause quite clearly states that the Trust's aim is to educate the public by the preservation and operation of the Railway line between Grosmont and Pickering. True, there is a big difference that the Trust owns the Railway but I would have expected it to within the wit of a draftsman to make the WSRA an educational charity linked to the West Somerset Railway by name. If this was specifically advised to be impossible, then I have happy to be told so - and it could present an interesting piece of context as to why the WSRA might wish to own the Freehold!

Being a Charity provides many potential advantages (Gift Aid, Inheritance Tax reliefs for those making bequests, easier access to Grant funding) but it does mean there are certain restrictions on what can be done with Charity funds. Specifically, the favourable tax status enjoyed by Charities means they cannot be used as a means of supporting a commercial business or washing commercial profits through a tax advantageous environment. Hence, the Charity cannot simply hand over cash when asked to by the PLC. I sense that a frustration within WSRplc that the Association could not simply support what projects the WSRplc wanted it to lead to the formation of the Friends, which some WSRA members see as devise (in a "they started it first" context). Again, totally happy to be corrected if I have misread what I have seen and heard, of that the WSRA were being more restrictive than their Charitable status required.

Having had a quick look across both sets of accounts for 2013, the level of "charity" type income - donations, bequest, appeals, etc. appears somewhat less than I might have expected. I clearly don't know the detail of the figures - I have merely been able to access the Annual Reports as distributed to members and filed at Companies House, but it does make me wonder if this is an area where the railway is missing out due to the fragmented approach.

What this all comes back to is there appears to be total lack of appreciation by both sides as to exactly what the other is, the restrictions they operate under and how they can best help each other. An overall Strategic Plan that they both bought into could then be "carved up" to best match the qualities and opportunities available to the various groups to the tasks requiring doing and funding - what needs to be in a PLC Share Issue? What would be suitable for Charity funding? What needs a specific appeal? Any small projects where a few donors able to enjoy Gift Aid (or EIS relief on new shares issued) could be used?

Believe me, the more you look at the opportunities, the harder it is to conclude that the West Somerset Railway is not suffering as a result of all this and the more I would conclude that major change is needed.

Steven

 

Just quickly on Tom's point - I believe a charity could invest in a non-dividend paying Company if that Company's purpose was able to deliver or support the Charity's objectives. The degree of control (which could decide whether the Company's Aims changed) could be an issue that would provide uncertainty, although a Charity being able to block the Special Resolution required to change a Company's Articles (which is where the Aims would be stated - they no longer have to be but again a Charity Shareholder could insist they were).

I am not sure if any Railways are set up with the Membership Body as a Charity but the Land and Buildings owned by the PLC. In all honesty, I could see greater problems with a "supporting" charity buying assets for use on a "Commercial" Company's land.

Steven

 

The WSRA is already a large shareholder in the PLC. AFAIK these shares were bought before it became a charity.

 

I may be wrong in this, and I may raise a few hackles, but....

I though the first part of Faol's post summed up the historical situation nicely. When I first became involved with the WSR all those l-o-n-g years ago it was simple - if you wanted to 'support' the Railway then you joined the Association, paid your subs, went down to Minehead or wherever and rolled-up your sleeves, wielded the paint-brush etc, rattled the donation tins etc etc. The WSRA was run by members, elected by the members, on behalf of the members and it all went along fine.

Most of the heritage railways with which I am familiar seem to follow the 'preferred structure' whereby one body (usually a charitable trust) owns the assets and another body ( a commercial company) actually runs the railway. In such cases the latter is usually wholly-owned, or otherwise controlled by, the former. The Trust is usually also the 'supporters body' as well.

The operating company runs the railway on behalf of the owners. Assume for a moment that it were indeed the case that the WSRA bought the freehold, then they - and hence "the members" - would become the owners. Is that really wrong, given that it was "the members" who were/are responsible for bringing the line back to life again? In such a case there seem to be those who think it is a bad thing that the PLC should become 'subservient' to the Association, but is it? After all, if you own a house and then employ a builder to build you (say) a new kitchen, then you would expect him to do what you want and not decide to build a new bathroom instead because he though it was more necessary? (OK, not a brilliant comparison, but I hope you get my gist!) .

IMHO part of the problem in the current situation is that the railway is not owned by any part of the "railway family", but by a third-party namely the SCC. From what I can tell, they simply leave the PLC to run the railway as they see fit. Provided that it retains heritage status and boosts tourism, to what extent do they care about the nitty-gritty? The trouble then is that this leaves the WSRA in something of a 'loose appendage' situation, as it neither leading the way on what should be done on the railway nor is it tasked by the owners with any specific purpose. In the latter case, it lacks direction or guidance and so it has to try to find its own way........

Maybe the proposed stakeholders' group will help with this a little, but I'm not sure....the problem with "stakeholders groups" is often that (a) they simply end up as a form of 'management by committee', (b) may be used by those who should really be making the decisions to do that work for them and (c) can be just a 'tick box exercise' in 'consultation' or ' inclusiveness' or whatever other buzz-word trend you may wish to demonstrate some commitment towards (sorry if that sounds a bit cynical!)

The WSRA must - first and foremost, if not solely - support "the railway". Although in the current situation that may equate to 'support the PLC', how that is done needs to be better defined than currently seems to be the situation. Equally, the PLC may need to 'support the WSRA' in more/better ways than currently in order to work towards the common good. Ultimately the railway needs resources and income to survive - who gets this and how may not be so important as the fact of ensuring that that it happens - all this nonsense about one lot charging the other for 'costs' or 'services' etc gets in the way of simply raising the maximum of amount of money by the best possible means.

Sorry - I think this has got a bit (sc)rambled along the way, but it is getting late

 

Which is all very well, but some of the WSRA have been quoted as saying they want to run the railway - ie, effectively tell the Plc what to do on a day to day basis. You might want your builder to build a kitchen, but you wouldn't stand over him telling him how to do the work itself. That's the basis of the problem and without addressing it, there will continue to be problems.

 

This is a very perceptive comment which I am on record as agreeing with. Forswearing charitable status does have some complexities (not insurmountable) but would free up the WSRA to once again become that supporter's association, able to help the Railway where required, and to focus on the interests of its members (active and armchair), without having to justify actions with an (often tenuous) link to education. This is one option that needs to be firmly on the table for consideration when we are able to have the proper open debate about what the WSRA is for, hopefully over the coming year. It is one of the reasons why I have not felt able to support the WSRAMAG platform which talks of maximising the advantages of charitable status. Charitable staus may well be a millstone rather than an advantage.

Try a specific example. The Railway has been gradually working towards a proper loco shed at Bishops Lydeard. The loco compound there is set out in a way that building a GWR style brick built shed over it will be possible when time and funds permit. The bodies could co-operatively decide that the WSRA will progress that project in partnership with the appropriate plc officers. The WSRA would have a focus for fundraising. The Railway's infrastructure would improve, enginemen would be able to prepare their locos in more sensible conditions likely to encourage volunteers, the heritage environment would improve. WSRA members (both working and armchair) would feel that their membership was valuable and valued. And so much easier without having to justify it with a spurious link to educational charitable objects.

kind regards

Robin White

 

Whilst I have not been able to independently verify this a usually very reliable source has told me that justifying the charitable status takes up a considerable amount of WSRA. management time every year. I also understand that this has had a significant negative effect on the funds WSRA have been able to use on actually supporting the railway. Regrettably the accounts over the last few years are not very helpful in establishing exactly how much monetary benefit the charitable status has benefited the WSRA. My suspicion is that the they might have been better off remaining as they were. I am not convinced that the charitable status would stand up to close scrutiny as an awful lot of money seems to have been spent for very little educational benefit.

 

I have now been contacted by several WSRA members who appear to have been telephoned at home by one of the WSRA present Trustees seeking re-election, apparently by use of the WSRA membership data base, canvassing their vote in the election.

This is a further concerning development. If anyone else is so contacted, I would be grateful if they would let me know.

It would appear that the old adage about 'when you are in a hole stop digging' is not one easily recognised at the WSRA Kremlin.......

On a more positive note, it appears that the suggestions that there be an early evening BL-MD-BL DMU on Saturday 19 July may bear fruit. That cannot be confirmed yet. Watch this space.

kind regards

Robin

 

If that is correct it is more gerrymandering. Does it breach the DPA if this access to the database was not actually authorised?

 

It does seem to be electorally suspect, yet again. It is unlikely to be unlawful under the DPA as the individual concerned is a current WSRA officer.

I think it shows how frightened the re-electees in particular now are.

kind regards

Robin White

 

Just for interest, the charitable objectives of the WSRA are (from the Charity Commission website) - apologies for all caps!

OUR ASSOCIATION IS ESTABLISHED TO PROMOTE EDUCATION BY RESTORING, PRESERVING & DISPLAYING RAILWAY LOCOMOTIVES, CARRIAGES, WAGONS & ARTEFACTS OF HISTORICAL INTEREST & RELATED BUILDINGS PARTICULARLY THOSE CONNECTED WITH SOUTH WEST ENGLAND & ALSO THE PRESERVING & DISPLAYING OF BOOKS, DRAWINGS, RECORDS, DOCUMENTS, RECORDINGS, FILMS & PHOTOGRAPHS RELATING TO SUCH ARTEFACTS, THEIR HISTORY & DEVELOPMENT.

And, interestingly for the WSSRT (which everyone seems to forget in this discussion, but which conceivably could be the natural home of charitable fundraising, freeing up the WSRA to be the member body):

THE CHARITY IS PRINCIPALLY ENGAGED IN THE PROMOTION OF EDUCATION BY FURTHERING INTEREST IN RAILWAY LINES AND EQUIPMENT ESPECIALLY THE RESTORATION AND EXHIBITION OF HISTORIC COACHES. ALSO MUSEUMS AND LOCAL RAILWAY ARCHIVES.

A couple of things leap out at me:

1) Why does neither charity actually specifically mention that their charitable aims are particularly focused on the West Somerset Railway (i.e. the railway that runs between Minehead and Norton Fitzwarren)? As I read it, the WSRA could give a grant to help preserve a historic goods shed or signalbox on the Bodmin & Wenford or South Devon or even at a pinch the Swanage Railway and it would be entirely permissible within its charitable activities!

2) Given the above, the educational requirement seems overplayed, at least if that is being used as a reason why certain projects can't be funded. The mechanism by which education is advanced is specifically stated to include preservation of locomotives, rolling stock and buildings. So I don't see why the WSRA can't, for example, be used to help fund restoration of heritage buildings on the line (using WSRA money to construct new infrastructure, e.g. a Minehead water tower or a Bishops Lydeard engine shed is likely more problematic, as neither would be "restoration and preservation").

I do wonder why they are written that way? There are a number of charitable purposes set out in the charities act one of which is "the advancement of education" but another is "the advancement of the arts, culture, heritage or science" which might be a more natural fit. As an example, the objectives of the Severn Valley Railway Charitable Trust are:

OWNING, REPAIRING AND PRESERVING RAILWAY HERITAGE, COACHING STOCK AND ASSOCIATED ARTIFACTS FOR USE AND APPRECIATION BY THE PUBLIC ON THE SEVERN VALLEY RAILWAY.

which seems pretty clear! It basically says much the same as the WSRA terms, but much more succinctly and importantly, creating a direct link between the charity and the host railway. (Disclaimer : I'm not an SVR member).

Tom

 

Thanks for that. As I suspected but it is certainly morally wrong. They have plenty to be frightened about!

 

In the WSRAMAG group we considered that charitable status was a given when drafting the Consultation Paper. In that situation the WSRA Trustees had been claiming that this gave them an advantage - particularly when it came to buying the freehold - that the PLC didn't have, and that they could thereby raise lots of money. Our point was that they didn't seem to have been exploiting this much so far, and perhaps the WSRA had better get on with it, if they thought it would bring in additional funds. If you are saying that it might actually be better to go back to the non-charitable status, you may well be right. But the pros and cons need to be fully evaluated. Whether it is charitable or not, we would also argue that there is a need for a strong educational role and, again, the current WSRA doesn't seem to be making much of this, apart from engaging a small number of apprentices at Williton. But as I keep saying, our paper is a Consultation Paper, not a blue print! For us, agreeing the process (i.e. stakeholder engagement, full consideration and then transparency in implementation) is the crucial thing to agree at the start. And I think all the "new" candidates are getting close to agreement on that.

Frank

 

Tom

Good research, but my 'engine shed' analogy was specifically chosen to be something operational, which was not being preserved. I appreciate there is an argument that it assist the locos kept within, but should charitable status be not maintained, there would not be the need to justify against such considerations, which, as 'Yorkshireman' has pointed out can soak up a lot of effort.

Try another example - the construction of volunteer accommodation.

kind regards

Robin White

 

This is something the trustees have considered over the last few weeks. It would appear that the objectives were changed from "...supporting the WSR..." to the current wording some time ago under the belief that we werent able as a charity to say we were supporting a Plc. However we now believe that to be incorrect as when we say we are supporting the wsr we mean in the widest sense of the railway as a whole rather than the plc. This might have caused some antagonism and we now intend to look at changing it back to something nearer the old wording. This is something we mentioned to the wsramag when we had our most useful meeting last evening.

Ian Coleby

 

Glad we are able to agree. For a real root-and-branch re-examination, with the potential for a really long-term solution, all bets need to be off at the start of the discussion.

kind regards

Robin

 

The concept that a charity was a safer candidate to be the freeholder always seemed another example of WSRA Chairman's bull wash, as we say in Yorkshire. I have the distinct impression that rather like the North Koreans he thinks the more times it is repeated the more credible it will become. In fact for the SCC to remain the freeholder would be a much better solution since it would mean that both the PLC and WSRA would not have to show large contingent liabilities in their accounts or to fund insurance against a catastrophe such as a major failure in the land underneath the track bed or incursion by the sea.

 

Hi Robin

I chose those two examples simply because you had mentioned one, and the other is presented by FoWSR as a project that they can support that the WSRA can't(?) support.

But my more general point is that other railways seem to find a way to fund all sorts of activities within their charitable objectives. I know a certain railway that funded removal of 100,000 tons of domestic waste via its charitable body, which at face value doesn't seem obvious quite how! So it would seem to me that where there is a will, there is a way. I think there are a lot of financial advantages to having a charity that can support the railway (in its widest sense) financially - but carefully drawn terms would make it much clearer what was in scope or not.

Tom

 

I don't disagree about the advantages of having a charitable body around - you were right to draw attention to the WSSRT. In fact I worked with Peter Thomas on the original arrangements for the legal treatment of the Bluebell waste removal under the landfill tax credit scheme, as you probably know. (As an aside, Chris White (no relation) from the Bluebell, called in to see me at Bishops Lydeard box on Sunday while staying locally - good to catch up on Bluebell matters...)

The important step is to separate the membership body from the charitable one, so that the responsibilities and the drivers can be kept separate, and the advantages of the different structures can be reaped without organisational strain.

kind regards

Robin White