SPCK/SSG Creditors have 2 weeks to Act (Updated)

Matt Wardman writes:

This advert appeared in this week’s Bookseller.

Note that you only have about a fortnight to write in.

ST STEPHEN THE GREAT CHARITABLE TRUST

This charity has been in the press over recent years as a result of concerns expressed over its operations. In April 2009 the Charity Commission appointed Peter Gotham of Begbies Traynor as Interim Manager to take over its running - other than with respect to its religious mission in the churches it controls. This objective was made more complicated by virtue of the fact that since July 2007 the shops previously operated by the charity were managed instead by other companies appointed by the Trustees. The Interim Manager has now completed his initial work, has retaken possession of most shops, and is moving towards meeting valid claims on the charity’s assets. In order to do this he has instructed agents to put various of the Trust’s properties on sale. He is now advertising for creditors’ claims incurred before 1 July 2007 in order to ensure that no valid claims go unmet. (Any claims incurred after 1 July 2007 will be the responsibility of the various companies engaged by the Trustees.)

Creditors who believe that they have a valid claim against the Trustees of St Stephen the Great Charitable Trust incurred before 1 July 2007, should write to the Interim Manager at Begbies Traynor (Central) LLP, 32 Cornhill, London EC3V 3BT under ref S8703 before the close of business on 16 December 2009.

Presented by: Begbies Traynor (Central) LLP

Presenter’s Reference: S8703/PJG/NGA/BRS

———————————————————————————-

Editorial Note: I am not at all convinced by the cut-off date, though, without seeing rock-solid evidence. For example, Mark Brewer was reported by the Bookseller as acting for SSG in November 2007 when the chain dropped the SPCK name.

And which external companies were responsible for running the shops after 1 July 2007? The company which seems to have been responsible for running most of them – ENC Shop Management Ltd – was not registered at Companies House until 11 March 2008

Groups such as the Church of England Pensions’ Board and various government agencies, and other creditors, need to take a close look at this.

And you only have 2 weeks to do so.

[Update: 27/9/1009.

We have been in touch with the interim Manager's team during the afternoon.

The reason why responsibility is accepted for debts incurred before 1 July 2007 is that the Interim Manager was appointed to manage the "St Stephen the Great Trust" (no 1119839) charity, while a separate  charity - a Company Limited by Guarantee - had been created to manage the bookshops. The Interim Manager was not appointed to manage this Company Limited by Guarantee, and so they are not accepting reponsibility for debts incurred by this Company.

Editorial note: This is all horribly complicated, and we will try and submit a list of detailed questions to the Interim Manager and the Charity Commission over the weekend.  The Company Limited by Guarantee was merged with the parent charity (no 1119839) by direction of the Charity Commission on 27 July 2007 - see the "subsidiary charities" page on the link above, so it is not clear to us how the Interim Manager is entirely not responsible for actions of this charity.

In the meantime, there is an email address for the Interim Manager on the Charity Commission website, where you can send your precise queries.

My brain still hurts.]

STL UK puts up the ‘For Sale’ sign: who will buy?

IBS-STL UK Announces Plans to Sell Operations

Phil Groom writes:

In a press release issued earlier today, STL UK, the UK and Europe’s major distributor of Christian books and related products, have announced that their business is being put up for sale by their USA owners, Biblica. This decision comes in the wake of ongoing cashflow and stock movement difficulties faced by the organisation since an unsuccessful IT systems upgrade in October last year: combined with the current economic climate, the financial stress has become unsustainable.

This represents the biggest shake up in the Christian book trade for well over a decade, the SPCK/SSG debacle not withstanding, and not only puts STL’s 490 employees at risk of losing their jobs but also risks seriously undermining those hundreds of Christian retailers and suppliers who have become dependent upon STL for their supply chain.

I personally believe that this development does not need to be a disaster and at the weekend I put forward what I have called A Modest Proposal to Save STL UK. There are thousands of people whose livelihoods are likely to be disrupted if STL’s future is not secured: all the employees at Authentic Media and Paternoster Publishing; everyone at STL Distribution; all those working for Wesley Owen; and all the retailers and suppliers I’ve already mentioned. But if we stand together, between us I believe that we could stage a trade buy-out and take over the business as a shared ownership company.

But there is no reason why others — churches and other Christian organisations — couldn’t get involved. We have the means, if we have the will.

If you believe the idea of such a buy-out has merit, please spread the word amongst your friends and churches; if you have any other suggestions for a way forward, please speak out; and please pray for all those whose livelihoods are now under threat.

The UK Christian book trade and the church itself failed when SPCK hit hard times back in 2006. Many people’s lives were ruined and many are still picking up the pieces. It would be a tragedy beyond belief to see that failure repeated with Wesley Owen and its associated companies.

Related Posts

• IBS-STL UK Trade Communication: STL Blog, 16/11/2009
• Send the Light up for sale: Everything Christian, 16/11/2009
• STL’s UK businesses for sale: Wesley Owen bookshops, Authentic Media, STL Distribution: Church Times Blog, 16/11/2009

Peter Hebden, RIP

Phil Groom writes:

With great sadness, today we report the loss of Peter Hebden, former SPCK bookseller and the driving force behind the relaunch of Leicester’s former SPCK Bookshop as Christian Resources in November 2007.

I understand that Peter’s death, during the morning of Monday 9th November, followed a short illness, but have no further details at this stage.

We take this opportunity to offer deepest condolences and sympathy to Peter’s family, friends and colleagues.

Melanie Carroll, a former colleague and now owner of Unicorn Tree Books, Lincoln, writes:

Peter was a committed Christian and bookseller and invested much of himself into the Leicester Shop.

He had a good sense of humour, though on the dry side and will be surely missed by those who knew him and worked with him.

 

Freeholds For Sale at York and Bradford: Where Next?

Former SPCK Bookshop, York - Freehold For Sale

Phil Groom writes:

Thanks to the intrepid asingleblog for these photos of the York shop, now up for sale; and thanks to David Ormondroyd for the original tip off when he spotted the sign going up on Friday October 30th.

Interestingly, the company handling the sale is none other than DTZ, which readers with good memories will remember from the notices posted on the shop doors when the Charity Commission started seizing control: Changing the Locks: Official Notices as seen in Chester, Newcastle-upon-Tyne and Worcester. At the time of posting, this property does not appear to be listed at www.dtz.com.

Would purchase include fittings, fixtures and stock, I wonder? Judging from the photo below there’s actually quite a bit of stock left.

The other freehold properties are Bradford (For Sale sign spotted by Bradforddian), Canterbury, Exeter, and Truro. Exeter, of course, is history, but all five properties are still, if SPCK have the gumption to enforce it, subject to a seven year covenant — full details here (pdf, 745kb), excerpt below — restricting use of the the premises to trading as Christian bookshops. I wonder if the Interim Manager, having inherited the covenant, will insist upon any subsequent purchaser abiding by it?

Restrictive Usage Covenant

Former SPCK Bookshop, York - Freehold for Sale

Photos taken on Sunday evening, November 1st, 2009.

SPCK AGM 2009 – Salient Points

Matt Wardman writes.

On this blog we have attempted to keep up with a dozen or more different strands, and have communicated formally or informally with everyone from bullied staff to suppliers left high and dry to the USDAW Union to the Church of England Pensions’ Board.

More than 12 months on, some of the tectonic plates in the SPCK-SSG saga have shifted, some staff have received compensation after a long legal battle, and the Bookshop Chain is nearly (except for Durham Cathedral Bookshop. Bah!) under the control of trustworthy management in the shape of the Charity Commission Interim Manager of the SSG Charity. Painful decisions will continue, but the management can now be relied upon to follow the law of the land, and a set of honest principles.

The saga will continue for a long time to come, as debt recovery action takes place (I hope), assets are recovered, the Messrs Brewer are (we hope) brought to what justice is possible, and some new initiatives and bookshops continue to emerge from the rubble of the destroyed SPCK chain.

Following the SPCK Annual General Meeting on October 1st, these are some joint reflections drawing out some of the more salient figures from the Accounts and Annual Report.

SPCK Annual General Meeting 2009

The performance of SPCK in its current format of publishing and mission still holds relevance and concerns for former bookshops staff, and the publication of the latest Annual Report at http://www.spck.org.uk/about_spck/spck_2009_rept_accts.pdf gives cause for question.

Former bookshop staff still have a loyalty to the Christian mission of SPCK as it affects the wider Christian world through its publishing programme and world wide literature initiatives; feel worried about the fate of the bookshop premises once owned by SPCK which were funded by the giving and the support of thousands of Christians for nearly 200 years; and apprehensive about the shortfall in the pension fund which affects existing SPCK pensioners and those yet to receive their pensions.

Those with financial expertise and insight can read the Accounts and draw conclusions but key paragraphs in the Annual Report are as follows:-

From the Chairman’s Overview

“First, we experienced a large drop in the valuation of our investments; and second, we suffered from the outcome of a revaluation of a pension fund.”

From the Financial Review

“The Society recorded a net surplus , before exceptional items and gains and losses, of £294,000 (2008: surplus of £751,0000. Exceptional items in this time of economic downturn include an increased provision of £3,832,000 for funding a revised larger deficit in pension funding relating to a now-closed scheme, which was identified after a revaluation of funds by the Church of England Pensions Board. In addition, there was a large non-cash cost in the form of a net loss on the revaluation of investment assets of £3,111,000 (2008: net loss of £1,318,000). The net movement in funds for the year was a deficit of £6,648,000 (2008: deficit of £674,000).”

Further on investments

“The investment in William Leech (Investments) Limited has been used as security to guarantee the Society’s liability for additional pension contributions to the Church of England Defined Benefits Scheme”. Presumably because of stock market performance, the ordinary shares in William Leech, at market value fell from £4,640,000 in 2008 to £3,521,000 in 2009.

Sales

Sales income from Publishing in 2009 was £1,733,000 – in 2008 £1,834,000. The budget figure for 2010 implies a further fall.

Freehold Properties

The freehold properties housing the former SPCK Bookshops are no longer quoted assets.

Commentary

The Christian book trade is said to be in a fragile state at present, and the loss of 23 SPCK Bookshops can have been no help to publishers especially coinciding with a Recession. One hears worrying rumours about the future of Biblica/STL and the Wesley Owen shops. If SPCK did not survive, not only would the future of Christian mission and publishing be harmed, but also the pensions of former staff would be jeopardised and the William Leech Foundation, a generous charitable donor, harmed.

The pensions of former staff are held by the C of E pensions board, so if SPCK itself suffered really serious trouble, those funds are safe.

Finally, things may change (again) as the economy recovers from the current recession – perhaps particularly for investments held by the pension fund.

Wrapping Up

If SPCK wish to respond to any comments here, we are happy to publish a statement or commentary.

The SPCK AGM, Unfinished Business and Unanswered Questions

David Keen writes

The SPCK Annual General Meeting is happening this Thursday – 1st October – and the annual report and accounts for 2008-9 are online. There is a passing reference to the former SPCK bookshops:

“SPCK continues to have a number of significant legal issues with Saint Stephen the Great Charitable Trust in regard to matters connected with the former SPCK Bookshops. The Charity Commission has appointed an Interim Manager for the Trust, and progress is being made.” (page 6)

Others have stronger views than I over how much responsibility SPCK should shoulder for handing over their bookshops (and staff, customers, and suppliers) to a family of charlatans, who have unfairly dismissed over 30 former staff, been censured in the US courts for a fraudulent bankrupcty claim, and finally been booted out by the Charity Commissioners. And that’s just the tip of the iceberg.

Some better news for former staff: the report reveals that their pension scheme, which is managed by the CofE pension folks (as far as I can tell), had a big shortfall as a result of the CofE revaluing its pensions (though it was struggling before this). SPCK has started making additional payments into the fund of £285,000 to top it up. This is going to be paid for the next 15 years, and the whole amount has been put on this years balance sheet – £3,832,000.

As I recall from comments on this blog, there is some question about whether the Brewers have kept up with pension payments to the staff they inherited from SPCK. Whose job is it to retrieve those: SPCK? Charity Commissioners? Church of England Pensions Board? What happens if they aren’t paid? Maybe this is a question which needs to be asked at the AGM.

Though the pension fund has imploded, SPCK are at least doing their bit to support former bookshop staff on this front. But we’re not out of the woods by any means.

Couple of other things:
- SPCK have nearly £300k in a restricted fund for Newcastle Bible House, which seems to be for the purpose of Christian retailing in Newcastle. This is listed in the accounts. What’s going to happen to this?

- Do the premises of former bookshops still belong to SPCK, or were they completely made over to the Brewers? The shops, as I understand, were given over with restrictive covenant, and at least one has been sold on by the Brewers for another use. I’m not sure what the legal situation is here, whether the shops revert to SPCK if the covenant has been transgressed.

There are other questions which need asking at the AGM, so if any readers of this blog are planning to be there, here is your mission, if you choose to accept it…..

Chichester: The Door is Shut. Only Durham remains.

Matt Wardman writes:

These are two photos cross-posted from the ASingleBlog site. The former-SPCK Bookshop in Chichester has been closed on the instructions of the Charity Commission.

This is sad, and yet it means that – exactly as per the takeover of the SPCK-SSG charity by the Charity Commission Interim Manager – those trying to resolve this are now dealing with people of integrity, so we can at least say that Chichester is now on the way out of the swamp.

So the Brewer cash-generating, personal-expenditure subsidising, money-grubbing, supplier-swindling, staff-bullying, legality-avoiding (e.g., lack of required liability insurance), asset-stripping, and Durham Cathedral brand-poisoning, activities can now only be carried on in the Durham Cathedral Bookshop.

Every day that the Brewer-boys retain control of that shop provides a further opportunity for abuse.

Will someone in authority please finish the job?

Here are the Chichester Photos:

Podcast Interview with USDAW Legal Department about Bookshop Tribunal

Matt Wardman writes:

Last week we reported that a negotiated settlement had been reached and now implemented in the Employment Tribunal action between 32 ex-employees of the former-SPCK bookshop chain, and the Society of Saint Stephen the Great, now controlled by the Charity Commission through an Interim Manager.

I have done a podcast interview with Christine Peacock of the USDAW Legal Department, who has handled the employee cases (and the cases of paperwork) for the last couple of years. This interview aims to show some of the complexity of the case, and to give an inside view of the process. Here it is:

For new visitors, the background to this interview is that I’ve been involved with others in a campaign to place a spotlight on the mismanagement and asset-stripping of the chain of 25 bookshops which used to go under the name of SPCK, by the brothers J Mark and Philip Brewer. This blog has a very detailed account.

A community of campaigning bloggers, and a wider international network based mainly on Facebook and other social media sites, has had a role in this over a period of more than 2 years – gathering information, helping to expose a fraudulent bankruptcy attempt, keeping the Charity Commission on the case, and maintaining a spotlight on the case.

But this still has a long way to run – notably because there are still many small businesses who were simply never paid, and because compensation payments still have to be made – though that can be expected now that the Brewer Brothers no longer control the charity. There are more complex aspects such as what happened to pension and national insurance contributions which the Brewer Brothers never passed to the correct recipients.

And then there is the matter of bring Mark and Philip Brewer to some sort of justice, and making sure that those who need to learn the lessons from this debacle do just that. It is one more signifcant step forward, however.

The two Facebook groups are We Support Dave Walker (who was “Cease and Desisted” after 18 months of objective reporting; his blog is here), and A group for all those people who mourn the tragic demise of SPCK Bookshops, which still have a combined membership of well over 500 activists and supporters.

Making the News: The Usdaw Settlement

Phil Groom writes:

After such a long time of what feels like a few diehards more or less going it alone, it’s good to see the Usdaw settlement story making the news in so many places — thanks to all concerned and congratulations to Usdaw’s PR dept!

Search results for bookshop workers win payout: Google | Twitter

I’ve added all that appear to be genuine reports, including where they’ve simply run verbatim with the Usdaw press release, to the News Index. Best headline award in my opinion goes to Louise Nousratpour in the Morning Star:

• Staff beat un-Christian bosses

Taking Stock in Chichester

Phil Groom writes:

I have been informed that the Charity Commission are now closing in on the Chichester shop. Anyone in Chichester, please keep your eyes peeled and cameras ready to record any suspicious activity…