West Somerset Railway General Discussion

The provision for the overhaul was written down in the accounts for accounting policy purposes, it was stated that the previous provisions were higher than that provided under the accounting rules.

I'm pretty sure that in the year that the technical correction was made it *reduced* the loss to £800,000. If one was going to manipulate the accounts to maximise the improvement one would have left the higher-provision in year 1 and reversed it in year 2.

I await to see what the outcome is of discussions between the PLC and the Trust. I've not been following it closely but I haven't seen anything convincing that the WSR will overhaul it without (a) a contribution from the Trust and (b) a future running agreement?

Patrick

 

I'm sure it was, but that doesn't alter the fact that the written down amount was insufficient. In fact, it was doubtful if the un-written-down amount was sufficient, either.

 

I have vague recollection of figure's in the region of 225000 being in a ring-fenced pot for 88 and someone asking a particular person on a Facebook group where that money had gone. It sounded like it was possibly partly S&D monies as well as WSR contributions. With no answer forthcoming it was asked 2 or 3 more times as to where the money had gone, they were effectively silenced by being banned from the group.

 

There is no ring fenced pot of money. There is a provision in the accounts but the two are not the same thing.

 

I think the key word in the previous comment was 'suitable'. Yes, there may be many locos that could be brought in for hire. But when you consider that to be suitable for the WSR at present, a loco needs to be powerful enough to haul 6-8 coaches on a line with some quite challenging gradients, needs to have the water capacity to be able to do 20 miles on one tank if it's doing a MH-BL run (preferably with some water left in the tank at the end to give some wiggle room if things go wrong or you've got steam heat on), and needs to have a lighter axle loading class than GWR Red (which is 17t 13cwt and upwards), plus the fact that they would probably prefer locos with ex BR pedigree (both for image reasons and because many people don't think something like an Austerity is suitable for something like a WSR operation), that means the pool of suitable locos is probably much smaller than the available pool of locos. That probably limits you to locos like Manors, GWR Prairies, 5700s, BR Class 4s, Maybe BR Class 2s if they're capable enough for the job, 9Fs, and that's all my mind can think of atm from the pool of operables locos currently in Britain (feel free to chime in with any I've missed). Then consider the fact that the WSR doesn't necessarily have the best PR at the moment regarding locos (because of the whole SD Trust debacle, rightly or wrongly) and I reckon a portion of the groups / individuals that own a suitable loco might not be so keen about it taking a trip down to the Quantocks, especially if they get a better offer elsewhere.

 

Not sure what the point of your response is if im completely honest.

But in terms of obligations, or requirements as I was referring to, to run, explain how the WSR Plc pays the bills for overheads, staff, loans and mortgages without running train services? The bills will not stop because you have decided not to operate your business for a year. Sitting back and relying on donations or grants is a very big recipe for disaster, especially when your a business running on thin ice as it is.

 

They chose not to run and are still alive. Correct decision. They've paid these bills through furlough and grants like majority of tourist attractions in the UK.

 

Yes available and suitable are two different things, there are plenty of engines looking for work this year and they would not have been short, considering two of their own engines are in operating condition and that they have many years of working with various owning groups from various railways. I don't think owning groups can be fussy on railways willing to steam their locos in the current climate.

 

Give me this big long list of all the locos you think will be looking for work and surplus to requirements on the railways at which they are currently based. You seem to be very confident about it so you must have some concrete information.

 

For some reason my post responded to your response to another item (now deleted), and I note you added in your second sentence after my now deleted response.

So in response to your first sentence, without grants, how would the WSR have survived? Please advise that.

Wouldn't say its the best business decision to use a grant as a mechanism to keep your business purely afloat, especially when you had the ability to generate some form of income at various points in the year. Unlike other businesses which have been prevented from opening by government for a year now. But maybe i'm wrong and you have superior business acumen than me to say i'm wrong, who knows...

 

Would Betton Grange be allowed on the WSR at the present time? (? better RA than a Hall?). I could see the WSR rebuilding their fleet in much the same way as the MHR did following the loss of the Bunch collection.

 

No, red route same as Hall.

 

It tried building up it’s fleet a few years ago by purchasing 4110, and taking 44422 and 6695 on long term 25 year deals. Then look what happened.

The WSR always seems to have got by on a bare minimum fleet of locos, supplemented by one or two additional ones hired in for each season.

Perhaps we will start seeing the fleet build up again though. 7822 confirmed, wouldn’t surprise me if 5199 stayed for longer, and did I hear 6430 is there at the moment or am I making that up?

 

It's depressing how often the assumption is made that all income must be good. What matters isn't income it's surplus over costs incurred. Sure enough heritage railways have huge fixed costs but the run/not run decision needs to factor in the incremental variable costs of opening the railway. If those exceed the income that can be realistically generated then re -opening can make an already challenging situation worse. It also depends on whether there are sufficient cash reserves available to cover fixed costs while you batten down the hatches and wait for the storm to pass.

If the WSR Board Directors concluded reasonably that achievable income would be less than the variable costs incurred then they , and the other lines that stayed shut, made the right, but difficult, call.

 

I would want to form a view on the assumptions underpinning that choice before concluding the decision was right or wrong at the time it was made.

Given the mood of other large railways, and the levels of business last year, I would tend to conclude with hindsight that the wrong call was made.

 

I would agree with you to a degree, but the decision also needs to include the wider economic impact your closure will have, public image, additional costs you will incur by not running, staff and volunteer morale impact, and proper market research. And it appears none of that was really considered, based on a former WSR Plc board members comments on a certain WSR related Facebook page where the only market research into demand was a walk along Minehead seafront on a not particularly nice day prior to several businesses such as campsites, hotels, and butlins opened. And there was no suggestion to say they had even engaged with these businesses, or any others in West Somerset to determine actual demand.

Perhaps running and not being any financially better off or worse than they were by not running might have actually been the better decision. But they chose not to and now will incur additional expenditure which could have potentially been avoided by running.

 

There is a truth in that; however, for a business that is basically a visitor attraction, if opening the attraction doesn't even cover the immediate variable costs of doing so (let alone the huge fixed costs, i.e. infrastructure and equipment renewal) then you really have problems. The levels of grant funding of last year is unlikely to last at those levels for long; at some point you get to a choice between having high fixed costs and no income; or high fixed costs and some income. There is also the point that re-opening after a long shut down brings fixed costs, and the longer you stay closed, the bigger those costs are. (I include cash and non-cash in that thought about costs: a non-cash cost would be volunteer re-training and retention).

So I have to assume that the WSR is able to cover its variable costs from fare income etc. A stab in the dark - maybe about £2,000 to run a steam-hauled train a round trip of 40 miles? So you need about 70 - 80 passengers at full fare, or proportionately more at discount fares, to cover that - about two carriages. Every additional passenger then starts contributing to the fixed costs.

Tom

 

The question would be this - if costs associated with running were greater than potential income was the reason for not running then what has changed in the meantime to mean that income will exceed costs this year.

Why is TnT service this year a money maker when it wasn't last year?