Privatisation the Virgin way

Virgin has many privatised contracts with the NHS. Is there any reason to believe his companies will treat the NHS any differently to the way they treat what used to be our railways?

“Sir Richard Branson will have taken at least £306m in dividends from Virgin Trains by the time the firm’s 22-year tenure as a rail operator comes to an end within the next 12 months.

Branson said on Wednesday the Virgin name could disappear from trains by November, after its joint venture partner, Stagecoach, was blocked from three franchises by the Department for Transport over its refusal to pay more into rail staff pensions.

Analysis by the Guardian indicates that Virgin Rail Group Holdings, the joint venture company, will have collected at least £600m since its launch in 1997, a figure that drew criticism from Labour. …

The final total is likely to be higher once this year’s dividend is declared when the company’s next set of annual accounts is published in October next year.

Branson’s Virgin Group owns 51% of the venture, giving him a £306m share of the overall dividend pot.

The remaining £294m was allocated to the Stagecoach transport group, whose largest shareholder is the Scottish businessman and Scottish National party donor Brian Souter, together with his sister, Ann Gloag.

The highest dividend in a single year was paid in 2009, when Virgin Trains paid out nearly £95m. The figure has hovered around £50m over the past three years.

Andy McDonald, the shadow transport secretary, said: “This money could and should have been used to invest in services and hold fares down, not siphoned off by shareholders.

“The railway should be run as a public service in public ownership. Instead, absurdly, its run in the financial interest of foreign state-owned companies and billionaires such as Richard Branson. If Virgin disappears from the railway as Branson warns, it won’t be missed by taxpayers or passengers. …””

https://www.theguardian.com/business/2019/apr/11/richard-branson-earned-300m-virgin-rail-franchises?

McCarthy and Stone poor results: closing operations in south-west – whither PegasusLife now?

“A slowdown in secondary housing transaction volumes eroded operating margins for McCarthy & Stone (MCS) during the first-half, as the retirement home providers used discounts and incentives – including part-exchange – to boost sales.

Management hopes to make more than £90m in cash savings between 2019 and 2021 by scaling back sales and marketing teams, standardising build designs and closing operations in the south-west of England.”

https://www.investorschronicle.co.uk/shares/2019/04/10/mccarthy-stone-hindered-by-property-slowdown/

AND

“Half-year profits at McCarthy & Stone tumbled by two-thirds as it ploughed more cash into a turnaround to cope with a slowdown in the housing market.

The retirement housebuilder handed consultants £4.5m for advice relating to its strategy shake-up, which included closing offices in Scotland and the south-west of England and making almost 200 of its 2,500 staff redundant at a cost of £3.5m.

Those and other one-off costs left McCarthy & Stone with pre-tax profits of £3.6m for the six months to February, down from £10.5m the previous year.”

https://www.telegraph.co.uk/business/2019/04/10/redundancies-restructuring-hit-mccarthy-stone-profits/

Read this before buying a new home (particularly from Taylor Wimpey )

Owl says: surely developers building shoddy or dangerously constructed new homes should be banned from tendering for new schemes and banned from using government subsidies from Help to Buy schemes to sell homes already constructed forever?

“It took seven families two years, but a group of homeowners in Scotland has taken on a housing giant in order to have their “crumbling” new-build homes repaired. It’s part of a broader, UK-wide issue – this is their story.

Sheila Chalmers moved to Peebles with her husband 10 years ago. Her three-bed home was one of 250 built by developer Taylor Wimpey on a new site in the Scottish borders.

For eight years, life went on as normal. Then something strange started to happen. Overnight, families at the top end of the estate started to vanish. But there were no for sale signs and no-one new was moving in. “It became almost a ghost street,” she says. “Houses were empty. People were disappearing.”

Sheila later heard that the properties had been bought back by Taylor Wimpey after problems were discovered. The owners had signed non-disclosure agreements so they could not speak out.

Taylor Wimpey confirmed it did buy back a “small number of homes” to start with. It later sent a letter to all the remaining residents, saying that some houses did have a problem with the mortar holding together their bricks.

Sheila thought she did not have anything to worry about, but she went outside and checked anyway. Patches of mortar were clearly eroding, she says, and in other places it could be scraped out with a fingernail.
She paid for assessments by two different structural engineers, who both said the house needed extensive repair work, though Taylor Wimpey said its own inspections found that was not the case.

Mortar is made up of two key materials: cement and sand. The more cement in the mix, the stronger the mortar, though the more brittle it can be.
The family paid to have their laboratory tests on the mortar carried out by a specialist firm.

The results suggested that there was far more sand in the mix than you would expect for a home in that area, although Taylor Wimpey says the type of chemical test used was “not appropriate” and the results could not be relied upon.

Our investigation in 2018 found similar complaints about weak mortar across at least 13 estates in the UK all built by different companies.

Three doors down from Sheila, live Pete and Jill Hall with their 13-year-old son. Like Sheila, they first learned about the problem two years ago when Taylor Wimpey were buying back the individual houses. They paid for their own tests, which showed only one in eight samples taken from their home met industry guidelines, although again Taylor Wimpey says the test used was “not appropriate”.

“On the garage the tests came back showing it was just sand,” said Pete.
A video filmed by the family after a rainstorm clearly shows the mortar on the back wall falling out when a screwdriver was run gently along it.

Handmade signs

In the end, seven core households became involved – passing on details to a wider community group on the estate. The families worked together to build their case, paying for their own structural surveys and using Freedom of Information laws to demand internal documents from the local council.
They made handmade signs and protested outside the showroom of another Taylor Wimpey estate in the area.

In 2017, they presented their findings to Taylor Wimpey’s lawyers, saying that they would go public if their properties were not fixed, demolished or bought back. They were surprised at the response.

The families’ solicitors received a letter back saying they had decided not to report the group to the authorities under the Proceeds of Crime legislation. “It was accusing us of bribery, effectively,” said Pete. “It took me about 10 minutes to stop laughing. But it was intimidation, a threat.”

By then, Pete and Jill had hired their own engineers to examine the house. They recommended that the couple should stop using the garage because it was at risk of collapse, although Taylor Wimpey denies that there was a structural problem.

The couple bought a giant shipping container, covered it with warning stickers and left it on their front lawn.

That, they say, got Taylor Wimpey’s attention and – two years down the line – an agreement has now been reached for their home to be fixed. “It falls short of where we think a full repair should be, but they have said it’s that or nothing – so we have accepted it,” Jill says.

‘Someone has to stand up’

In December 2018, Taylor Wimpey sent out letters saying all 130 houses in the estate built with the weaker mortar would now be offered “remediation” work.

Properties are being dealt with one at a time. Construction crews are scraping out the old mortar and replacing it with a stronger material.

Taylor Wimpey said it “sincerely apologises” to the all the homeowners affected, is “fully committed to resolving matters” and has “a clear plan in place to remediate affected homes”. “This is a localised issue and falls short of the high-quality standards we uphold,” it said.

The firm has now apologised to Sheila and, even though its own inspections found a full repair is not needed, said work to replace the mortar in her home will start this summer. It will refund the £16,000 she has spent on legal costs and technical reports, most of which she had to borrow.
Repair work on Pete and Jill’s property, which may involve the demolition of the garage, is due to start in mid-July.

Both families say the fight has been time-consuming, stressful and put them off ever buying a new-build home again. “These developers, these companies, cannot be allowed to continue the destruction of people’s lives with building shoddy homes,” said Sheila. “Somebody has to stand up and show them that they cannot get away with it.”

What went wrong?

Maps drawn up by Taylor Wimpey show about half of the 250 homes were built with far weaker mortar than recommended under industry standards

A memo sent to all developers in the UK by the National House Building Council (NHBC) in 2013 warned about this problem

The local council in Peebles says the mortar used was not the type in the original building warrant and was changed later without its knowledge

Taylor Wimpey says the material was “of sufficient strength to meet structural requirements” as “supported by an independent review” by the local council, but accepts it may be “less durable under prevailing exposure conditions”

It says it has now offered to repoint “any home which was constructed with the same mortar, regardless of whether our inspection found this was necessary or not”

https://www.bbc.co.uk/news/business-47816530

EDDC external auditors being investigated for their work with failed EDDC HQ builder

“Britain’s audit watchdog said on Thursday it was investigating the audits by Grant Thornton UK of some financial statements of Interserve, the outsourcer that was taken over by lenders last month.

Scrutiny of Britain’s “Big Four” accounting firms has been spurred in the past year by a handful of investigations into listed company’s financial reporting as well as the collapse of Carillion and Poundworld, which led to an inquest in auditing industry standards.

One of the British government’s biggest contractors, and a peer of collapsed infrastructure and outsourcing group Carillion, Interserve was placed in administration in mid-March after shareholders rejected a rescue plan to deal with its debts.

The Financial Reporting Council said it was probing the audit of the company’s financial statements for 2015, 2016 and 2017.

Grant Thornton UK did not immediately respond to a request for comment outside of work hours.

The FRC is already investigating the accounting firm’s audit of cafe chain owner Patisserie’s financial statements for 2015-2017 after the discovery of a black hole in its finances led to the breakup and sale of the group.

The run of bad news has led to calls by lawmakers for the breakup of Britain’s “Big Four” accounting firms Ernst and Young, KPMG, Deloitte and PricewaterhouseCoopers.”

https://uk.reuters.com/article/uk-britain-interserve-investigation/uk-watchdog-investigating-grant-thornton-interserve-audit-idUKKCN1RN0IN

Retiring Chief Constable blames political choices for ‘systemic failings’

“A departing police chief has used his farewell address to suggest his force no longer has the resources to “protect its citizens”.

Jon Boutcher, chief constable of Bedfordshire Police, attacked government cuts as he announced he would be leaving after five years in the job.

It comes amid a row between police forces and ministers over whether reduced policing budgets are to blame for a rise in violent crime.

In a statement announcing his departure, Mr Boutcher claimed that Bedfordshire Police had been the worst-hit force in the country.

“Policing remains hugely underfunded and Bedfordshire Police provides the most profound example of this as a force with the most challenging and complex demands normally only faced by metropolitan forces such as the Met, West Midlands and the like, and yet the funding gap has still not been addressed,” he said.

“I recognise recent efforts by the current Home Secretary and Policing Minister to reverse a long standing lack of police investment however I would remind everyone that it is the first responsibility of government to protect its citizens, policing must be properly funded.

“The consequences of previous budgetary decisions are now being felt by all of our communities. This must be addressed.”

Mr Boutcher earned nearly £123,000 a year, and will be entitled to a healthy taxpayer-funded pension. Last year it was revealed that two thirds of chief constables received a total of at least £1.37million in pension contributions in the last two years – with some getting more than £40,000 a year.

In March 2017 Mr Boutcher publicly criticised a report by Her Majesty’s Inspectorate of Constabulary which rated his force as the worst in the country for keeping people safe and reducing crime. It identified “systemic failings”, and deemed overall service provision “inadequate”, a drop from the previous year’s assessment of ‘good’.

In response, Mr Boutcher claimed: “My officers cannot cope with the demand and no-one seems to be listening. Something is going to give. Things cannot go on as they are. My officers are exhausted.

“I can’t tell you why they aren’t listening. I can only assume it is political.” …”

https://www.telegraph.co.uk/news/2019/04/08/police-chief-warns-force-can-no-longer-protect-citizens-blames/