Llangollen Railway

The interesting question to me is 'how many more lines will be having to put out similar statements soon?'

But my best wishes to the new crew there, and I hope they can right the boat.

Noel

 

No doubt a few multimillionaires making a fortune, wanting a loco!

 

The old adage is 'if you want to make a small fortune from heritage railways, start with a large one'

Patrick

 

Llangollen does have a perfect storm of having spent its capital on an extension just as Covid bites, management weaknesses coupled with its losses/liabilities with contract engineering, and Welsh railways as yet not having had Cultural Recovery funds announced.

Let's hope for a good Santa season.

Furlough to March will help heritage organisations considerably, paying the wageroll in the off season might actually improve their budgeted finances.

Patrick

 

The only flaw in that argument is that the paid staff are usually needed to do a lot of work during the closed season and, if that work isn't done, possibly no trains at Easter.

 

Not to mention, where's the money coming from? [The heritage rail sector is a molecule in the bucket on this issue, of course. Still, that was my immediate thought on reading this.]

Oh, right, put it on the never-never, our kids (and grand-kids) can pay it back.

Noel

 

Not an unusual situation if the 'old' signatories on the bank accounts have walked and don't want to know. Then there's no one the bank knows to authorise the new people so the bank has to do their due diligence and make sure the 'new' people who are trying to gain access to the accounts actually are entitled to before they will let them have access and follow their instructions to delete the 'old' crew. And of course the banks are not renown for their helpfulness and speed these days as this sort of thing needs human intervention and not just ticking boxes on their computer...

 

Agreed - but still one hell of a mess to deal with.

 

To true. And not a quick process in my experience.

Having been involved in a similar situation in the past I was surprised when the bank concerned didn't seem to want to 'help' with the process even though the bank manager was a member of the club concerned and knew all the people involved and the situation... It still took 3 months to get access to the accounts.

 

It is a shame the line is in such difficulties as it is a lovely railway, I really hope it can succeed and overcome the situation.

I do think though that any railway getting into debt like this is playing a dangerous game. There should be no spending money you don't have.

 

Off thread: the Covid-19 public finances are being paid for by QE (aka printed money) of which another £150bn was created last week, the interest on which is being paid by the government to the Bank of England, who give it back again. The same arrangements followed the 2007/8 financial crash and are practiced by the EU, US etc and not a penny of it has ever been reversed. As yet the government's not borrowed anything off anyone else and isn't paying any interest on it. I don't think they or other governments will ever reverse it and pay it back (can you see a future election promise: "we will sell these bonds back to the market and destroy the money they give us; we will then tax you more to pay them the interest"?).

The UK's share of the QE was £445bn from the 2009-2016 round and £450bn so far for this. I've seen forecasts they will continue further rounds for some years to come

Ends...back on thread

Patrick

 

That's not really a realistic view, though, is it? how many of us could afford to buy a house or even a car without borrowing some money? The vast majority of us do so and manage to live within the constraints of what we can afford to repay. Most businesses borrow at some point to speed up their development and take advantage of opportunities they cannot otherwise afford. Provided it is done sensibly and with a good business case I don't see a problem, and most heritage railways tend to be asset-rich and cash-poor.

 

Guess British volunteers aren't allowed into Wales not helping either. Looks like a very busy winter for most workers, too. It will all be ok in the end though.

 

3 out of 4 countries maybe but not English.

 

I have tried 4 times and I still cannot access the Statement....I am not on Facebook. Could somebody just cut and paste it?

 

It's an attachment on a public page and not marked as copyright or confidential, so I don't think there will be an objection to it being shared

Patrick

 

Thank you Patrick......It certainly is a very honest appraisal and I'm sure that there will be widespread support to pull the situation round.

 

Point taken, but still some relief for short periods for some railways that employ staff in non-operational roles.

So yes to staff on Pway but during November and Jan-March when for some lines trains aren't running you might find you can furlough paid sales, communications, retail, events or museum staff. You can flexi-furlough from as little as a minimum claim period of 7 calendar days. If you can, perhaps defer for a few months that Valve and Piston exam , or work on that carriage.

Also, an employer can continue to claim for a furloughed worker’s wages when the worker takes annual leave. So the railway can agree with their worker to take unused leave before the holiday leave year end, or half term in February, and get it paid as furlough (that surprised me).

Every little helps - particularly where cash is short.

Patrick

 

It is a good, concise report and hopefully sets the tone for future updates. It does raise questions about how the previous Boards have led the railway in to this mess.

It seems to be a common heritage railway theme; people in very responsible roles either operating outside of their level of commercial & professional expertise or operating without sufficient oversight and challenge from their colleagues. Organisational failings rarely just happen, they’re a slow car crash. Covid has accelerated the process.

The positive aspects of the Llangollen are that the transition to the new regime has been swift, there’s a sense of urgency, communications seem to be open and brutally honest, and there’s a prioritised plan of action. Hopefully this will give confidence to creditors (who hold the key to allowing the railway to trade or not) and it will inspire people to provide financial and practical support.