POOR decision-making by West Somerset Railway’s top management has led to years of financial losses and could have put the heritage line out of business, its chairman said this week.
Jonathan Jones-Pratt admitted to shareholders that the railway had suffered “critical business failures which have resulted in significant financial losses”.
And he said that emergency action had been necessary after top-level management “took their eyes off the ball”.
Mr Jones-Pratt warned that the latest figures for the 15 months up to March this year would show a “sharp decline in the financial condition of the PLC” and said that “tough decisions remained ahead”.
But he insisted that the current plan was putting the company back on track and there were already signs of a “great recovery”.
The state of the 22-mile heritage railway was highlighted in a sweeping financial and business review triggered by what was described as the “recent poor performance” of the company
This week, local MP Ian Liddell-Grainger welcomed the fact that the railway had admitted there were problems.
“But what puzzles many people is why it should have taken this long for the directors to remove their heads from the sand and come clean about the true state of affairs,” he said. “All the signs have been there not for months but for years.”
Mr Liddell-Grainger said the company’s fortunes had dramatically changed from the days when it had “a £1 million cushion safely tucked away in the bank”.
He claimed that today, WSR had “become so desperate for cash that it has had to mortgage a locomotive, go cap-in-hand to the bank and even sell off coaches -the most sought-after and valuable items for any heritage railway”.
Mr Liddell-Grainger said he believed many local residents were prepared to help turn round the company’s fortunes.
“But if the railway company wants their help – which I firmly believe it needs – there has to be a complete culture change.
“Secrecy will have to be replaced by transparency. Only by adopting such a regime will the company secure the respect and trust of the local population.
“Only when it gains both of those can it then start to approach them for support to see it through what looks very much like its darkest hour.”
The MP added: “The moment of truth is close – as is, surely, the day of reckoning for those in charge of the railway during the critical business failures which have lost it so much money.”
In response, Mr Jones-Pratt told the Free Press: “It was very apparent that the top-level management took their eye off the ball and this has led to us taking emergency action to sort out the dramatic losses year on year and cleansing the poor decision-making that ultimately would have seen the WSR fall over.
“The focus is now moving from ‘turnaround’ to ‘recovery’ but for shareholders and staff, we owe it to them to be transparent.”
As previously reported in the Free Press, the company is faced with a major programme of replacing miles of track and ballast after a report by the Government’s transport safety watchdog, the Office of Road and Rail, and has launched an appeal to raise £400,000 towards the work.
A former chairman, Ian Coleby, has also warned that the business is not generating enough income to cover long-term maintenance and investment or to meet a soaring wage bill which is nudging £1 million a year.
The company has already announced the line will be closed between Watchet and Minehead for five months over the winter to allow the time-expired track identified by the ORR to be lifted and replaced.
Mr Jones-Pratt said: “The business must, and will, be ready for 2020 operations. We may need to take some further, tough decisions as we aim to ensure a professional operation of the WSR in the future.
“My job is to execute a plan that will ensure that the railway gets back in charge of its own destiny.
“The immediate safeguard changes that have been made have meant that financially the railway is now on target and performing to a positive business model.
“What isn’t positive is the past, and for that reason there are some bad news stories for those periods. There is no hiding from that.
“We also have a decline in our infrastructure that needs attending to – as professional operators we can now see a collective plan coming together to deliver a best practice railway.”
railway.” Mr Jones-Pratt added: “I am not yet finished with changes and further detail will unfold in the coming weeks. Next year is my target to ensure that we put the past to bed.
“We are seeing a great 2019 recovery, focusing on improving morale and doing a far more professional job than in past years.
“The management accounts now show a positive uplift, the business is back in profit, and we now have our creditors back in control – another milestone.
“There are some very positive messages coming through now – we are on track and the plan is working.
“I cannot, and will not, cover up the past. My duty is to deliver a successful railway and I am absolutely committed that we will succeed, even with a challenging journey ahead.
” A WSR spokesman said that changes for the near future included a new board of directors to take charge of operations, engineering, finance, safety and infrastructure.
It was announced last Friday that general manager Paul Conibeare, who was appointed a director last year, would be stepping down from the board.
“It was felt that the role of general manager is to run the daily operation and should be reporting back to the board, not participating on the development of plc strategy,” Mr JonesPratt said.
Article Written by By TONY JAMES West Somerset Free Press.