So much for the Thanet Council Tory Group's one-day-old promise to promote open and transparent government and allow filming at Council meetings. The word hypocrites comes to mind. I therefore decided to film the meeting secretly, but was discovered. I was asked to leave the meeting but refused. The Chairman closed the meeting and postponed it to another time.
During the short time the meeting was in session a Council officer distributed a letter which we were told was written by the Ostend Port Harbour Master. The letter is not dated or signed but reference to the forced sale of the TransEuropa ferry Gardenia would put it about late September/ early October.
The letter says that Ostend Port has lost 3.5 million euros (£2,938,953) by deferring Transeuropa's fees and charges in the same way that Thanet did. The letter also sates that Ostend will be trying to sell the remaining Transeuropa Ferry, the Larkspur, to offset some of its losses. But just like the case of the of Gardenia which was sold for 750,000 euros in September, Thanet Council will not share in the proceeds of this sale because senior Council officers and Labour Cabinet members chose not secure Transeuropa's mounting debts against its assets.
This astoundingly foolish and incompetent decision has cost the taxpayers of Thanet a share of about 1.5 million euros which will have been realised by the sale of TransEuropa's assets. This money would have gone a long way to cushion the blow of a secret gamble with your money which went badly wrong!
But most surprising of all the letter from Ostend makes some extremely serious allegations about the owners of TransEuropa Ferries. These allegations are so serious that I have edited them from the letter so that I will not be sued. If these allegations are true then why on earth did the Council agree to defer debts which rose to an astronomic £3.5million in 3 years when there appears to have been some serious worries on the integrity front
One of the excuses given by the Council Chief Executive is that TransEuropa were in discussions with investors who promised to pay back all the company debts to the Council. However, the Chief Executive is on record as saying that the Council did not perform financial due-diligence on these investors. This is incomprehensible. Surely if someone who owes you several £million tells you they have an investor who will pay off the debt the first thing you would do is to check if the investor is good to cover the debt. But not Thanet council. Not good old incompetent, maladministered Thanet Council. They simply took the word of a company which Ostend is now describing in incredibly strong libellous terms. Sounds a bit like Pleasurama if you ask me
Some final comments on this appalling scandal of mismanagement and incompetence is that the Council has allegedly received independent legal advice which says that it has 2 hopes of recovering the £3.5 million debt - Bob Hope and No Hope. Word on the street is that this sad news will be announced before Xmas. Surely this should mean the political leaders (Clive Hart, Rick Everitt, Bob Bayford and Martin Wise) and the senior council offices who managed this scandal should do the honourable thing and resign. But not in Thanet. Things don't work that way here.
Instead my Council insiders tell me that a fall guy has been set up to save some top honcho arses. The fall guy is now busily clearing his desk for a New Year departure with a large cash settlement and gagging clause perhaps? But mine and Richard Eastcliff's imaginary rabbit friend called Harvey is telling me to be careful what I say.
One thing is for sure Thanet Council's augean stables stink and need a Herculean cleaning out. In 20015 you help to do this.
Here is the edited letter enjoy
To Mr. Mark Seed
Before taking on the issue of Transeuropa, I think I will have to explain the (legal) structure of the Port of Oostende.
There are 4 seaports in Belgium (Antwerp, Gent, Zeebrugge, Oostende) governed by a regional decree (Flanders) setting out in great detail structures, authorities, etc., including the possibilities for some government interventions of which the most important ones are the provision of base infrastructure (e.g. approach channels) and the maintenance thereof (dredging). The region of Flanders owns all land and water but gives that in a 99 year lease to the Port Enterprise (see further). From there on the Region is not involved at all in any matters concerning the Port, save for controlling if everything is done legally, on the basis of the Port Decree mentioned earlier.
The legal structure imposed by the Port Decree is that of an "Autonomous Municipal Harbour Enterprise". In essence it means that the port is an enterprise, a company governed by the laws on private enterprises, not under administrative law as for government or municipal agencies. This harbour enterprise is fully owned by the city in which it is located. (You could say the City owns 100% of the shares although there is in this case no issued shares as they are in any case never transferable).
As a result, the port decree states that the harbour enterprise is to be governed by a board of directors, 18 in total. Of these 18, 11 are city councilors from all parties represented in the city council. There is 6 parties in all, a coalition of 3 form the majority.
The board of directors of the Port is in a way a reflection of the city council with an additional 7 independent members (from industry, academy, education, and myself). The chairman is the mayor of the city (the mayor in our system is elected and combines your functions of leader of the council and mayor).
The board meets in principal four times a year and is given all relevant information, including financial. The fact that Transeuropa didn't pay its bills was mentioned with each financial report. Given the information available the board decided each time to give it a further chance. If we would pull the plug so to say, it would have meant the immediate end of the line with no - or very little - chance of ever starting again. It was considered that the continuation of the line was to be given every chance, knowing the risk of failure but at the time not jeopardizing its chances of survival.
At the board meeting of March 2013, for the approval of the accounts for 2012 (Balance sheet, p/I, etc.) the board agreed to my suggestion to write off all outstanding debts of TEF up to 31/12/2010 as a precautionary measure. This resulted in a extraordinary cost of 655 000 euro for 2012.
The accounts, as in any company, have to be approved at the AGM of shareholders. In our case, that is the city represented by the City Council. The City Council approved the accounts, unanimously (including opposition!) knowingly writing off old debts of TEF and was informed about the debts for 2011 an 2012, still in the accounts as receivable.
When TEF finally failed, the board was informed (again) of an outstanding debt of about 2,5 million euro for 2011 and 2012. We had sent, but not booked, invoices for 2013. These are therefore obviously a loss of income but not to be written off as a bad debt. Through a question officially filed on the meeting of the City Council in June by an opposition member, the Mayor confirmed to the City Council the debt of 2,5 million to be written off (which the councilors - board members already knew). Obviously it was then picked up by the press but caused not further commotion other than the community expecting the council and the port to try its best to attract another ferry line. After all, this was a break in a tradition that had started in 1846 and is understandably an emotional event.
Our accounts at the end of 2013 will cumulate the loss of income in 2013 and the write off of 2,5 million euro for 2011 and 2012, resulting in a net loss of some 3,5 million euro. Since its creation in 1996, the Port never lost money, quite the contrary, but we will have to seriously consider on how to finance the future running and development of the port.
I hope the above sheds some light on how the Port of Oostende dealt with the failure by TEF. An additional problem now is that the ships are abandoned in our port and there is no provision under Belgian law about who should take care of an abandoned ship. As they are in our port, and a threat to safety in our port, we had to take charge. They cost us about 25 000 euro per month with no guarantee we will be able to recuperate that money.
The Gardenia has now been sold (two weeks ago), the Larkspur will hopefully be sold towards the end of the year.
All in all very unsavory story with the Dias family appearing -------------- rather than the image of distinguished gentlemen they succeeded in making us believe.