Feeds:
Posts
Comments

Archive for February, 2012

Opposition to the government’s “work for your JSA” schemes has continued to grow. Companies from Burger King to Poundland have pulled out of programmes that make “jobseekers” (that’s unemployed people to you and me) carry out work placements for no money.

And new revelations have shown that exploitation runs beyond just stacking shelves, while there are doubts that the workfare scheme actually has any real benefit at all.

Before I get into the details, a word for Employment Minister Chris Grayling if he happens to be reading. The views set out in this post are my own, not those of the Socialist Workers Party or some other far left group. I don’t belong to a political party at all, in fact.

It might be convenient for you Tories to attack all opposition by using McCarthyite tactics and smears, but the reality is that many ordinary, independent minded people oppose what you are doing. And an awful lot of us take the simple view that those who work should be paid for their labour.

So far much of the opposition to workfare schemes has concentrated on the retail sector, where the unemployed have been offered opportunities to gain experience in such high skill areas as stacking shelves or sweeping floors – or been mandated to swell the profits of supermarkets by working for nothing if you prefer.

It turns out there are other sectors involved too. Take another high skill industry: cleaning.

The Guardian has used Freedom of Information requests to establish that several cleaning companies, including a major government contractor, Avanta, have used jobseekers as unpaid cleaners in houses, flats and offices across the UK.

But surely they must get a lot of high quality training that will help them to gain full time employment? No, according to one company which was asked if they were job shadowing, the reply was that “they are actually doing” cleaning.

And all of this was revealed just days after reports surfaced that A4E, one of the biggest private sector providers of such scheme, had compelled jobseekers to work unpaid in its own offices.

That’s the same A4E currently being investigated by the police for allegations of fraudulent business practices. The same A4E that has already had to pay money back to the government for several breaches of rules. The same A4E that was founded by Emma Harrison, who has now stepped down as David Cameron’s “families tsar” and from the board of the company.

It has also been reported that the Social Security Advisory Committee, an impartial body set up to advise the DWP on welfare policy, has expressed concerns that some unscrupulous employers are using workfare schemes for their own benefits. Well, who would have thought?

Some companies reportedly took on unpaid staff through various government programmes to cope with the busy Christmas period before deciding come January that there were actually no jobs available. Others reduced the overtime paid to existing staff because they could get free labour instead.

And the Committee’s chair, Paul Gray, has asked the DWP to take further action to prevent work experience roles taking over paid jobs: “He said that the committee had voiced some serious concerns around the potential for exploitation of the work experience scheme”.

But surely the bottom line is that these schemes do actually get people into work? No less an authority than the Prime Minister has said that half of those involved go into employment, hasn’t he?

And the Work and Pensions Secretary, Ian Duncan Smith, has said the same: “The fact is that 13 weeks after starting their placements, around 50 per cent of those taking part have either taken up permanent posts or have stopped claiming benefits.”

Well, the reality is a little different.

For a start leaving JSA does not necessarily mean going into a full time job. Some people leave because they go into education, get sick, have a baby, start to look after an ill or elderly relative or even die.

Jonathan Portes, the Director of the National Institute of Economic and Social Research, has said that the general figures for those leaving Jobseekers Allowance are high: “almost 60% of claimants leave within three months and almost 80% leave within six months of making their claim.”

So there you are. Workfare is exploitative and unfair. And it doesn’t even work.

Perhaps if government ministers were to spend rather less time on personal attacks of their opponents and more time on coming up with ways to create more jobs then they might manage to dig themselves out of their current hole. A hole, it has to be said, that is entirely of their own making.

 

Read Full Post »

Why A Diamond Jubilee?

Am I the only one who is already bored with the Diamond Jubilee?

We seem destined for a whole year of events to mark the fact that we have been ruled by the same person for sixty years. But is this really something to be proud of? And can anyone tell me what the monarch actually does that’s so important anyway?

Now I have nothing personal against Elizabeth of the House of Saxe Coburg and Gotha, or Windsor as they now call themselves. And I do think it is wrong that anyone in their eighties should still be working rather than enjoying their retirement. But the basic question is one of why we actually need a queen, or indeed king, at all.

Or to put it another way, if the monarchy had simply stopped back in 1952 would we actually notice any great difference over the past sixty years?

We live in a constitutional monarchy, we are told. Many of the powers of the crown would never actually be used. For example, if the Queen didn’t like a bill passed by Parliament she could technically refuse to give it the Royal Assent and it wouldn’t become law. It’s not likely to happen though. And many other powers, like the creation of peers or the awarding of honours, are really just rubber stamping what the Prime Minister of the day decides anyway. So why do we need a monarch?

The vast majority of the role of the head of state is ceremonial. The key skills required for the job are the ability to wave, to listen to endless speeches without looking bored and to make small talk with a lot of dull people. But the pay is good and there is a lot of foreign travel involved, not to mention a hefty salary plus expenses.

And then there are the fringe benefits. Lots of land, a few palaces and several castles come with the job. All of your family are also automatically employed in similar, but less important, roles that come with their own hefty salaries, etc. And you even get to be the head of your own religion.

All of this costs us, the taxpayers, somewhere around £200M each and every year.

The celebration of the Diamond Jubilee represents sixty years since the death of the current queen’s father. The monarchy is of course a hereditary office. There is never any consideration of who might be the best person for the job or, perish the thought, an election. No, when one monarch goes there will always be another from the same family ready and waiting to take over.

Many supporters of the monarchy hold the views they do out of respect for the current queen, who we are told does a good job. Leaving aside exactly how the performance of a monarch is best judged, shouldn’t we be looking at the principle of the post rather than the current incumbent?

Opinion polls indicate that support for the monarchy will fall dramatically when the next King Charles takes to the throne, and there are those who would like to skip a generation to King William. But that misses the point of a hereditary system. You don’t get a choice, that’s exactly how the whole thing is designed. You get the next in line whatever their perceived strengths and weaknesses might be.

And the media continues to “report” on the royals’ every move in a deferential and fawning style that is far from journalism. ITV News thought the fact that the name of the queen’s grandson’s new dog had been revealed worthy of inclusion in all of its main bulletins earlier this week. And even the supposedly impartial BBC is under fire because of the one sided nature of its documentary ‘Diamond Queen’, which was so biased that it could have been a palace produced propaganda piece.

But isn’t it time that we consigned this whole expensive fancy dress pageant to the past where it belongs? The crowns and the parades, the pomp and the ceremony. Many other countries seem to manage pretty well without a royal family. In fact the vast majority of the world’s independent nations have no royal family.

I’ve written before about the need for a modern written Constitution that would clearly set out how our state should operate. The abolition of an unelected and undemocratic head of state should be a part of that process.

So why doesn’t the country give the queen a real Jubilee present? Bring her current role to an end and let her live out the rest of her life in Buckingham Palace in a long and happy retirement as a former monarch.

Surely that would be a suitable present for a Diamond Jubilee?

Read Full Post »

I first wrote about coalition plans to force unemployed people into unpaid work on fear of losing benefits over a year ago. Now the Government’s Workfare scheme – or Mandatory Work Activity as they call it – is both under pressure from opponents and facing employers leave the scheme in droves.

Social networking sites have been full of the story recently as job adverts from Tesco and even the Department of Work and Pensions (DWP) itself have been posted – adverts looking for staff to work full time for just Jobseekers Allowance plus expenses.

Online pressure and demonstrations at stores has seen Tesco call for the government’s scheme to become totally voluntary. And the likes of Sainsbury’s, Waterstones, Matalan, TK Maxx and Maplin Electronics have already withdrawn, causing embarrassment to the government.

Even the discount shop 99p Stores has said it had signed up to the scheme but was withdrawing because of the negative publicity, having not yet taken on a single worker through it.

How does that feel Mr Cameron, Mr Clegg? The 99p Store thinks you are cheap!

And Chris Grayling, a Minister at the Department of Work and Pensions has appeared rather confused about how Mandatory Work Activity (MWA) actually operates. He was quoted as saying that the scheme is purely voluntary (what does the M in MWA stand for again?). He also said that participants are free to leave at any time. Well, if they don’t mind losing all of their Jobseekers Allowance, I suppose.

So how does it really work?

The DWP can exempt jobseekers from national minimum wage laws for up to eight weeks and they are offered placements in supermarkets and other large businesses, often in the retail sector. They work for up to 30 hours a week for eight weeks – and do not get paid. Those who refuse to participate can have their benefits frozen.

DWP officials claim that if jobseekers “express an interest” they must continue to work without pay after a one-week cooling-off period or face having their benefits stopped. But many of those involved have told the media that they were never informed of this cooling off period – and had been led to believe that they had no choice but to take part or lose their benefits.

There is no guarantee of a job at the end of this period of unpaid work, and there appear to be no limit to the number of jobseekers that any employer can take on at the same time. According to the latest figures 34,000 people were put through the scheme between January and November last year.

It’s a great deal for employers – they get free labour after all. But many people have another name for a scheme whereby someone is forced to work for no pay: slavery.

Cait Reilly, a geology graduate from Birmingham, is currently taking legal action, seeking a review of the legality of its forced labour. She was told that she would lose her £53 a week if she refused to stack shelves at Poundland for no pay. Public interest lawyers acting on behalf of Ms Reilly have sent a letter-before-action, the first stage in a potential judicial review, challenging the Jobseeker’s Allowance (Employment, Skills and Enterprise) Regulations 2011

The actions taken by protestors against Tesco show that consumer pressure can have an effect. No company, not even a very large one, likes bad publicity. And Tesco will not want to see any repeat of the demonstrations that brought one London store to a standstill last weekend.

In a statement on Friday night Tesco, which made £3.8bn in profits last year, said it wanted MWA to become free from any sort of sanction. It said that it had engaged with the government in good faith but was now concerned about the compulsory nature of participation.

“We understand the concern that those who stay in the scheme longer than a week risk losing their benefits if they drop out before the end of their placement,” Tesco said. “We have suggested to DWP that to avoid any misunderstanding about the voluntary nature of the scheme, this threat of losing benefit should be removed.”

Waterstones has said that it left because did not want to encourage unpaid work. Sainsbury’s stressed the only back-to-work scheme it was engaging with was entirely voluntary and would try out benefit claimants for an actual job vacancy. And The Guardian has reported that other major high street chains are reconsidering their involvement with MWA.

In Scotland, government officials will not even confirm which employers are involved. The DWP has rejected a Freedom of Information request from The Herald newspaper, arguing that there was no public interest argument for releasing the information.

Meanwhile the DWP does not need to look too far to find evidence that schemes like this one simply do not work. In fact it has already completed its own research report into Workfare schemes. That DWP report concludes:

“There is little evidence that workfare increases the likelihood of finding work. It can even reduce employment chances by limiting the time available for job search and by failing to provide the skills and experience valued by employers…

“Workfare is least effective in getting people into jobs in weak labour markets where unemployment is high… Workfare is least effective for individuals with multiple barriers to work.”

And if all of this wasn’t bad enough, the government has now announced that it plans to extend this scheme to groups of sick and disabled people, including people with complex conditions, serious mental health issues and those terminally ill with cancer with more than 6 months to live. Now that is taking exploitation to new depths.

Clearly forced labour for zero pay is only in the interests of the companies who benefit from it. So when even they are backing out of the MWA scheme in large numbers it must be time for even this government to realise that a change in policy is required.

But this morning Work and Pensions Secretary Ian Duncan Smith defended the controversial scheme. He dismissed opponents as, “a commentating elite which seems determined to belittle and downgrade any opportunity for young people that doesn’t fit their pre-conceived notion of a ‘worthwhile job’.”

Well, Mr Smith. I have no problems at all with unemployed people gaining any job that they can. If only there were more jobs out there for them to get. But unemployment seems to have a bad habit of rising under Conservative governments, doesn’t it?

Where my problem comes is when unemployed people are forced to work for no pay. That’s cruel and exploitative and the practice should be stopped right now.

Read Full Post »

Rangers FC is in administration.

That’s the headline many people assured us that we would never see. It was just some fantasy made up by the club’s opponents. A Celtic supporters’ wet dream. It could surely never be allowed to happen to such an important club.

But the day has come.

The board of Rangers Football Club is no longer running things; instead joint administrators Paul Clark and David Whitehouse of Duff and Phelps are now in charge of what should now legally be referred to as “Rangers FC PLC (in administration)”.

The job of the administrators is to run the club for the benefit of the creditors. Not for the benefit of its shareholders, fans, players or Scottish football. The creditors.

The Insolvency Act of 1986 tells us that the administrator must either rescue the company as a going concern, achieve more for creditors through running the company than they would get through liquidation or sell off property to pay debts.

Good luck to them is all I can say!

It has amazed me how much of a shock the current state of affairs has seemed to come as to many Rangers fans. Surely enough information has been available for a long enough time that those with a direct interest in Rangers should have been aware of how dire the club’s position was?

This is partly down to the Scottish mainstream media, which has downright refused to investigate the matter properly. There have been few questions asked, a scarcity of reports written. No difficult questions asked. Up until now Craig Whyte’s credentials as saviour have not been questioned. It all looks so different now, doesn’t it?

But the information has largely been in the public domain. The new media has taken the lead in examining documents and filings that any good investigative journalist should have had his or her hands on months ago. It wasn’t that they couldn’t get to the truth. They simply refused to go looking for it.

So what happens next?

Can any extra income be generated for the club? Well, there are no cup matches coming up to sell tickets for. A few tickets can be sold for home league games, but not enough to make a real difference. Catering and the like are contracted out so even selling a few extra pies won’t bring in additional cash.

When Motherwell went into administration a number of years ago they cancelled season tickets. You see, if you hold a season ticket you effectively become a creditor. You have paid in advance for something and the administrator could simply add you to the list of creditors rather than supply what you have paid for.

So in theory all 30,000 plus season ticket holders could now be charged at the gate to attend home matches. That would bring in an additional £1M or so from each home match. But would fans who had already paid out for season tickets be willing to pay again, knowing that the money was simply going to be used to pay the club’s debts?

The administrators will try to cut costs for a start. And the key area they will look at is the salaries bill. It is likely that playing staff will go as well as support staff. Players whose contracts end soon will be first out the door as they have no resale value.

Every other area will be looked at too. Can the club be run with less advertising or hospitality? What bills can be reduced? Which supplies are nice to have rather than must have?

But how long can a club that is currently running at a £10M per annum loss (Craig Whyte’s figure, not mine) survive? How can a figure of that magnitude possibly be turned into a profit? Because if the club continues to run at a loss that simply means more creditors looking for a share of less money – and remember that the administrator has to act in the interest of the creditors.

Just how much does the club actually owe in total?

That’s a difficult question. We know that what is called the Big Tax Case concerns Rangers appeal against a £49M bill and that they are likely to lose. We know that there is now a further £9M in outstanding income tax, National Insurance and VAT owed. We know that Craig Whyte’s company is owed £18M for the bank debt he paid off and that a further £24M has been borrowed from Ticketus.

So that little lot comes to £100M. That’s one hundred million pounds. £100,000,000.

Then there’s the matter of the 6807 fans who bought debentures in the club deck at Ibrox in 1990 at prices ranging from £1000 to £1650. The issue document states that ”the debenture shall immediately become repayable at par without interest” if ”any administrator or receiver is appointed to the undertaking of the company or any of its property or assets”

We can therefore add somewhere between £6.8M and £11.2M to the total debt.

We also know from press reports that money is owed to several other football clubs. Hearts are due further payments on the Lee Wallace transfer. Dundee United and Dunfermline are owed ticket money. And Inverness have effectively extended credit to Rangers by giving them tickets for a forthcoming game.

Now Craig Whyte’s business practice in recent times has appeared to be to pay bills at the last possible moment, in many cases only when court action is taken. So would anyone be surprised if money is also owed to the police, the local authority for business rates and to a multitude of other smaller companies for goods or services received?

The total debt then? I’m guessing at somewhere around £125M. Unless of course there are other big bills which I don’t know about.

Could the administrator ever generate enough money to pay off these bills? Simply, no. Even if Ibrox Stadium and all of the first team squad could be sold off it would generate nothing like that sum.

Talk amongst fans is of an agreement being reached with creditors that they will take only a percentage of the moneys owed to them, on the basis that some money is better than no money.

To get such an agreement, creditors owed at least 75% of the total debt must agree, giving the tax man an effective veto. And Her Majesty’s Revenue and Customs will not agree to any such deal. The idea is, quite simply, dead in the water.

So what is the future for Rangers FC PLC (in administration)?

I simply can’t see any way that the club can get out of this situation. The debt is too much, the damage is done. Unless someone comes up with a spare £125M or so that they are willing to donate, then liquidation is the inevitable outcome.

Rangers FC will cease to exist.

As I’ve already written, a new company will in all likelihood be formed, call it Glasgow Rangers (2012) Ltd or something similar. Like any new clubs it will have to start from scratch and to gain a league position. And that raises a whole host of new arguments.

But the current club, the one with 140 years of history, the one that refused to employ anyone of a certain religion for so many years, the ones whose supporters rioted from Barcelona to Manchester and everywhere in between, the one run into the ground by Sir David Murray and Craig Whyte, will be no more.

And one small point to anyone who says that could never happen – you were telling us exactly the same thing about administration just last week.

 

Read Full Post »

In my last blog I mentioned that I would cover what would happen if/ when Rangers Football Club goes bust. Let’s now take a closer look at two things: what should happen and what could happen if we listen to those who claim that the club must be given special treatment “for the good of Scottish football”.

So here’s the scenario. The outcome of the Big Tax Case is announced and, as expected, the result goes against Rangers.  A bill of around £50,000,000 from Her Majesty’s Revenue and Customs arrives at Ibrox. There is no way to pay it and HMRC is in no mood for a deal. A winding up order is issued by the courts and the club is liquidated. Assets are sold off to pay back money owed to Craig Whyte’s company (as the priority creditor), with any others owed money, and there are likely to be a fair few, receiving only a fraction of the sums they are owed.

In terms of company law, Rangers simply ceases to exist once all of the necessary technical and administrate matters are resolved.

But what happens in footballing terms?

Well, for the answers we need to look at the Articles of Association of the Scottish Premier League Limited (SPL), which can be downloaded from its web site. The SPL is a company in which each Member, that is each club playing in the league, owns a Share. When one club is relegated at the end of each season the rules state that its Share must be passed to the club promoted from the first division. This is clause 15, for the anoraks out there.

Clause 14 sets out what happens when a member club goes bust, and the process to be followed is:

“that Member or its manager, receiver, administrative receiver, administrator or liquidator or any other person entitled to the Share shall, on receiving notice in writing from the Board following the Company in General Meeting passing a Qualified Resolution that such notice should be issued by the Board and confirming the identity of the proposed transferee, transfer its Share to such other person as the Board shall direct at the price of £1 and the Club owned and operated by such Member shall forthwith cease to be a member of the League and the Club owned and operated by the transferee shall become a member of the League in its place.”

Simple, isn’t it?

In essence what it says is that the SPL will decide on another club to which the share of the club that goes bust must be passed. This club will then become a company member in place of the one that has gone bust and will therefore play in the SPL.

So what is very clear is that a new club will come into the Premier League. But how will that club be selected? Well, first let’s look at another document, the Rules of the Scottish Premier League, which are also available to download.

Clause H5 tells us what happens if a club goes bust during the season:

“If any Club in the League ceases to operate or to be member of the League for any reason, its playing record in the League may be expunged and the number of relegation places from the League shall be reduced accordingly.”

That means all results involving the team going bust are forgotten, as if those games had simply never happened. The eleven teams remaining would play on until the end of the season and no club would be relegated.

The champions of the first division will then expect to be promoted as normal and there is a vacant space for them. So that club, be it Falkirk, Ross County or whoever, simply takes the place and we are back up to twelve clubs once more.

And, crucially for this piece, there is then no space for a new team to join the league.

But, we are told, if Rangers goes bust a new club will be formed and it could play at Ibrox. This phoenix arrangement, where a new company is quickly formed to take the place of an old one, is perfectly legal. The new company (Newco) is not responsible for the debts of the old one and can start again, pretty much with a blank sheet of paper. It may be slightly more complicated than I’ve made it sound, but not much!

Now, I’ve already shown that the rules of the SPL mean that there would be no room for a new club to join at the end of the season. There would, though, be a spare place in the third division once all of the promotion and relegation arrangements are decided. And the precedent here is clear: the Scottish Football League would advertise a vacancy, any clubs that wished to could apply and the members of the league would vote on which one to choose.

And that’s where the Newco should be. Applying for a place in the third division along with any clubs from the Highland League, South of Scotland League and so on who fancy their chances. Indeed, these clubs, for example Huntley or Dalbeattie Star to name but two, have a history and a place in their communities that arguably gives them a stronger case for admission than the Newco.

So that’s what should happen if all of football’s rules are followed.

But there is a view being propagated through the Scottish media that a different approach should be taken. The Newco, it is argued, should be allowed direct access to the SPL “for the good of Scottish football”.

This implies that all of the rules quoted above simply be ignored, that the Newco assumes the place of the departed Rangers in the SPL and then everything goes on much as before.

You see, we are told that Scottish football needs Rangers. It simply cannot live without them, in one form or another. TV revenue would drop, other clubs would lose gate income, the league would become uncompetitive. A swarm of locusts is probably next on the list of catastrophes that must be avoided at all costs.

But that is all, to put it politely, nonsense.

There are many arguments as to why the established rules should be followed. Basic fairness and sporting integrity are at the top of this list. The Newco is exactly that, don’t forget: a new company, a new football team. It has no history and no pedigree. And no right to any special treatment.

Think what the actual benefits to Scottish football of sticking to the rules would be.

Remove one of the big clubs from a small top division and every other team has more chance of success. Higher league positions. European qualification. A better chance of progressing in the cup competitions every season.

Successful football teams attract more fans; that’s always been true. Surely those in charge of SPL clubs would rather have more of their own fans at every home game? They might lose one or two big away supports each year, but would gain in every home game. And there would also be a greater chance of fans outside Glasgow following their local team.

Perhaps the most competitive period in Scottish football was the 1980s when the “New Firm” of Aberdeen and Dundee United challenged Celtic for trophies while a failing Rangers were amongst the also rans. Scottish football seemed to manage pretty damned well without them as a power. Just look at the success the New Firm had in European competitions to see how strong they were.

And let’s not forget that for the Newco to join the SPL another club must be excluded. Would that mean no promotion from the first division? Or would a side be relegated to make way? Either way one club must lose out in order to accommodate the Newco, which is hardly fair.

No, Scottish football would be just fine without the Newco in the SPL. And, if it did win the vote for admission to the third division it could always work its way up the league structure. That way any eventual place in the top division would be secured on merit rather than through a flagrant disregard of football’s rules.

And if the Newco inherits a chunk of the support of Rangers it will benefit all lower league clubs it plays through higher attendances. Surely that’s a win for our smaller clubs, bringing money to where it could potentially save other clubs.

If the scenario I have outlined does come to pass and Rangers goes bust, Scottish football will have a big decision to make. Does it stick to its own rules or does it make an exception for the Newco?

Pressure will be applied through the media for the latter course of action, but I hope that those who run the game will show the integrity to withstand it. There should be no special treatment, no favours, for the Newco.

There are those who think a Rangers Mark 2 has some sort of right to sit at the top table. But rights must be earned. And in a footballing sense, to gain the right to be in the Premier League you must fight your way up through the structure.

A special case or exception to disregard the established rules of Scottish football quite simply throws any measure of sporting integrity out the window. It would mean accepting that one club is bigger than the rest, indeed that one club is bigger than the game in our country.

And at that point we may as well all pack up and go home, because, to use a good Scots phrase, the game would be a bogie.

No, any Newco must start at the bottom. It must be given no favours. And this must be done for the good of Scottish football.

 

Read Full Post »

So the transfer window is closed and attention turns from potential targets. But life looks very different from Glasgow’s two main clubs right now. To clarify, I mean Celtic and Rangers, although we may soon be talking of Celtic and Patrick Thistle under that heading.

It was a decent window for Celtic. Despite the media’s best attempts to talk up most of the first team regulars leaving, no one was actually sold. The only players to leave were youngsters seeking playing time through loan deals.

And several new players joined the club. The collection of international full backs was augmented with the signing of Sweden’s Mikael Lustig from Rosenborg, while youngster Andre Blackman is also on board.

African midfielder Rabiu Ibrahim won a deal after impressing in a trial, while Polish international striker Pawel Brozak has come in on loan for the remainder of the season, with an eye on a permanent deal if all goes well. Efrain Juarez and Morten Rasmussen also returned to Paradise after loan spells in Spain and Turkey, respectively.

Another Pole, centre half Jaroslaw Fojut, signed a pre-contract deal and will join Neil Lennon’s squad in the summer.

Competition for places is fierce these days with a large number of internationals at the manager’s disposal. But those are the type of problems that managers like to have.

Meanwhile over on the south side of the city, young Swede Mervan Celik was the only addition to Ally McCoist’s squad. A bewildering array of triallists found themselves at Murray Park for short periods before being told that there was actually no money to sign them. Indeed, Rangers suffered the indignity of seeing Honduran international Jorge Claros depart as they were unable to meet even his relatively modest wage demands and then sign for eleventh placed Hibs

A string of players left the club, including club captain David Weir and supposed wunderkid John Fleck, who is on loan at Blackpool. But the biggest loss will be top scorer Nikica Jelavic, now an Everton player. The fee was a modest £5M, far less than the reported bid from an unnamed club turned down in the summer and the talked of £10M valuation that Rangers placed on the player.

Still, when you are known to be desperate for money, what buyer is going to pay over the odds?

With a weakened squad, manager McCoist approached chairman Craig Whyte/ White for some spending money but was unceremoniously dismissed empty handed. Clutching a scrap of paper outlining the remainder of his squad the former Question Of Sport captain drove away from Ibrox surely contemplating his future in the job. I’m certain he would rather be up against John Parrot right now.

So where does this leave Rangers?

Well, any team that has a strike force of Kyle Lafferty and David Healy as its first choice must be in trouble.

And off the park things are looking increasingly bleak for Chairman Whyte and co – and that’s before a likely £49,000,000 bill from the tax tribunal lands on the doorstep. Even the Daily Record is now picking up on information that has been around for months and writing articles about what a perilous state the club is in.

With the accounts yet to be signed off by an auditor a month after they should have been submitted to Companies House and no AGM yet called, it looks rather like Mr Whyte has something to hide. Could it be to do with how he managed to find the money to pay off the bank the £18M that the club owed when he bought it?

For the avoidance of doubt, there are two main reasons why the Rangers finances make those of Greece look healthy right now.

Firstly, years of overspending under Sir David Murray’s ownership.

Secondly, years of not paying their taxes under Sir David Murray’s ownership.

And it must be remembered that these factors gave the club an unwarranted, indeed illegal, sporting advantage. That’s why they could afford to buy the players that they brought in and pay wages that no other club could match.

It is clear that Murray was eventually forced to sell Rangers for the princely sum of £1 after being unable to find a buyer any other way. The bank, HBOS, had run out of patience and wanted their money back.  And, probably correctly from their point of view, they didn’t give a damn who or where it came from. They knew Murray couldn’t come up with it so he was told to find someone, anyone, else who could.

Enter Craig Whyte. Alleged millionaire, or is it billionaire? Man of several names and many companies. Well known to the authorities and having recently finished a ban on being a company director as a result of previous misdemeanours. The saviour, who promised to wipe out the debt (which he didn’t as it is now owed to his company) and to invest in the club. Hasn’t quite worked out that way, has it?

Whyte’s method of running things is complex and although much has been brought to light, no one really knows the full story. I’m not altogether certain I follow all of the financial arrangements that make up this particular house of cards. But I know enough to see that the whole damn thing is going to blow away and pretty soon too.

The ongoing tax case regarding the non payment of tax and NI in relation to past players and other employees was always the elephant in the room. The unmentioned issue that shrouded the club’s future at the time of the takeover. But delays in the case mean that no decision has yet been announced, and that has caused Whyte difficulties as he tries to keep the club solvent in the short term.

Plan A was Champions League qualification. That would have given enough of a cash injection to get through to the end of the tax case. Plan B was Europa League qualification. Less income but it would probably still be OK. And if those both failed? Well, surely Ally couldn’t screw up that badly could he?

Plan C? There was no plan C.

No bank or other financial institution will now extend the club any credit. Whyte now been forced into the effective mortgaging of future season ticket sales as a means of raising money to pay the basic bills. And this gives a clear indication of the short term nature of Craig Whyte’s thinking. Money in now, no money in future seasons.

The funding of the Glazers’ purchase of Manchester United has been mentioned as a comparison. But that is the ultimate chalk and cheese situation. A little grain of chalk compared with the annual cheese production of France actually.

Manchester United makes massive profits every year and can therefore sustain making large payments annually. Rangers quite simply doesn’t and can’t. By Craig Whyte’s own admission there is a shortfall of £10 million between annual income and expenditure right now.

Whyte’s business model is the equivalent of borrowing half of the next three years’ salary from Wonga.com just to pay off some of your debts after the bank has cut up your credit card. You have money today of course. But what about future bills? And how do you pay back that loan – which has a dirty great chunk of interest added on?

Let’s be honest here. Craig Whyte has never been interested in running a football club.

He is doing exactly what he has done in the past. He has identified an ailing company. He has bought it at knock down price. He will wait until the moment when he can sell the assets and make a profit. And then he will walk away.

If by some fluke of the legal system the tax case is won, he will sell the club. And if, as is more likely, it is lost he will be paid back his £18 million plus several million more in fees for managing the club. It will be liquidated and he will walk away with a profit.

Rangers as a business is long past the point of no return. There is no way out from under the debts caused by largely by Murray but added to by Whyte. It’s as simple as that.

Rangers Football Club is a dead man walking, just waiting to be put out of its misery.

What happens after that finally happens is a complex discussion all of its own. I’ve always argued that some sort of new club would emerge from the ashes, and still think that is the most likely scenario. I’ll return to how and when that is likely to happen, and who might be running things, another day.

It’s hard not to feel some sympathy with those low paid employees of the club who will in all likelihood lose their jobs. The office staff, those who maintain the pitch and so on.

But that’s as far as my sympathy extends. I’m with the journalist Ian Archer, who as far back as the 1970s described Rangers perfectly:

“This has to be said about Rangers, as a Scottish Football club they are a permanent embarrassment and an occasional disgrace. This country would be a better place if Rangers did not exist.”

I couldn’t have put it better myself.

Read Full Post »