Virtual Lancaster

Otters at Halton on the proposed Link Road route Photo by Stan Parrott. More pictures: www.polypics.co.uk

The Transport Solutions for Lancaster & Morecambe (TSLM)  legal challenge to the Heysham-M6 Link is due to commence in court on 22 July. In the meantime, a row has broken out over the tax dealings of Peel Holdings, owners of Heysham Port and the main potential beneficiaries of the massive publicly-funded roadbuilding project.

The current estimated costs of the scheme are moving inexorably toward the £140 million mark, with Lancashire County Council (LCC) committed to meeting all costs above the Government’s limit of £111 million despite facing £300 milllion budget cuts over the next 4 years.

The two main beneficiaries of the scheme were EDF, which originally had plans to build a new power station in Heysham – plans which have since been scrapped – and the Port of Heysham.

Peel Holdings, owners of Heysham Port, will benefit most from the Heysham M6 Link Road, but have declined to contribute a single penny to it. In March 2013 the conglomerate was the subject of a report by Liverpool-based research think-tank Ex Urbe who noted that it has received hundreds of millions of pounds worth of public UK and  EU funding over the years. (Download full report here as PDF)

They found that Peel has 320 registered companies and subsidiaries in the UK, and said there is “no doubt” Peel practices legal tax avoidance.  Peel Ports Holdings (CI) Limited, for example, which received £50m+   from the Ministry of Defence in 2008/09, is based in the Cayman Islands. The report states that:

“Peel’s parent company is an organisation called Tokenhouse Limited, registered  offshore in the Isle of Man. Its total assets are reportedly worth over £18 billion.   Tokenhouse Limited is also the parent company to Tokenhouse Investments   (Guernsey) Limited and to Peel Ports Holdings (Ci) Limited, which is based in the   Cayman Islands. All of Peel’s concerns lead back, through a complex web of   intermediate ‘parent’ companies and subsidiaries, to Tokenhouse Limited.  The Peel Group is thus a vast network of companies – it operates along “Russian doll” lines – a   company within a company within a company within a company and so on.”

The report quotes a letter that Ramsbottom-born  millionaire John Whittaker wrote about the family business in 2011:

“The Peel Group is controlled by the Billown Trust, which was established by my father, John Whittaker, and whose discretionary beneficiaries and are myself and other members of the   Whittaker family. The Billown Trust is based in the Isle of Man and owns approximately 73 per cent, of Peel, of which I am Executive Chairman. The investment in Peel is by far the most substantial asset within the Billown Trust. The remainder of the Peel Group is owned by the Olayan Group” (The Olayan Group is a Saudi family-owned conglomerate).

In June 2013, Margaret Hodge, Committee Chair of the Public Accounts Committee, dubbed the firm a virtual ‘monopoly’ and attacked the BBC for handing it millions of pounds in licence fee cash.  During an outing to Salford’s MediaCity, Mrs Hodge’s powerful public accounts committee grilled BBC chiefs on the value of their £1bn move north.  She singled out its contract with landlord Peel for criticism, accused the Peel Group of tax dodging, and stated that some parts of the group pay on average 10% Corporation Tax, and that some of the more profitable parts of the Peel Group pay 0% Tax. (Read the report in the Manchester Evening News)

The property giant rejected the criticism (see Lancashire Telegraph report), noting that  it had not been asked to give evidence to the Parliamentary hearing. Their spokesperson added,

“Following comments made at the Public Accounts Committee meeting on Monday, The Peel Group would like to make it clear that it rejects any assertion that it is not paying its fair share of corporation tax.
All Peel operating businesses, including Peel Media (the developers and owners of MediaCityUK), are UK domiciled for taxation purposes and pay the appropriate level of UK tax.”

The Ex Urbe report focussed on the influence Peel exercises over development and planning policy in the Merseyside area and noted that:

“Those democratically elected to represent the public interest  appear happy to throw the city region’s lot in with this organisation because it claims to offer a panacea to many of the area’s socio-economic ills. A cause and effect of this has been the blurring of the boundaries between public and private interests. The ever greater role of   a privately owned and run company in sub-regional strategy formulation, infrastructure   planning, decision-making and funding on Merseyside has, in our view, led to an increasing   lack of transparency and accountability, the ‘commodification’ of Liverpool and the wider Merseyside conurbation in the quest for investment, the diversion of political attention and effort into supporting Peel’s commercial goals and the triumph of marketing spin over hard fact, where public information is concerned.”

The report goes on to look at connections between the ‘Peel men‘  and the North West political infrastructure. One of the examples they list is Robert Hough, a director of Peel Holdings and numerous Peel companies. Mr Hough was for some years on the board of the North West Regional Development Agency, a powerful supporter of the Link Road project,  becoming its unelected chair in 2009. In 2012, he was made chair of the board of the Liverpool City Region Local   Enterprise Partnership, the Government-sanctioned, increasingly powerful, strategic  economic driver for the sub-region, which last year enabled Urban Splash (developers of Morecambe’s Midland Hotel), through the award of a public funding grant, to outshine a rival bid for a development – a move that appeared to benefit the Peel Group. (See Example 1, p177).

Now it appears that despite local budget cuts, which have already had harsh effects on local services and the public infrastructure county-wide, with worse to come, a significant portion of the County Council budget has been committed in an open ended promise to finance the Heysham-M6 Link Road scheme. We have yet to identify, when you cut through all the hype, any proof that, beyond the jobs created in the building of it (which must be offset against the hundreds of public service job losses required to finance it)  it will bring any economic improvement whatsoever to the region, with the sole exception of the Port of Heysham, which is likely to benefit from further publicly funded subsidy on the back of this ‘too-big-to-fail’ investment. We can find no grounds for the assumption that road haulage patterns will remain unchanged or even increase their custom, despite the rising costs of diesel and that they will not, as in the rest of the world, begin the expected transition to more sustainable models of rail freight over the next 20 years.

In fact the hard reality is that the completed sections of the link A683 which already connect Heysham to Morecambe Road are so underused that car retailers on the adjacent White Lund industrial estate use its long empty stretches for acceleration tests and the police complain of drivers speeding in excess of 90mph.

The Ex Urbe report noted: “The power and influence of the conglomerate across the North West generally …. has grown remarkably (and disproportionately) over the past few years. It now plays a quasi-political role in the sub-region, so entrenched has its role become in local governance.”

All other proposals to reduce local traffic congestion over the years have been rejected by the County Council, which has stated that any works or improvements are contingent on the Heysham-M6 Link road scheme being accepted. This refusal alone has cost the area economically as the issue of local traffic congestion, which the M6 link scheme fails to address, continues to create a barrier to long-awaited city centre and South Lancaster developments.

David Gate, the chair of Transport Solutions for Lancaster & Morecambe has written to County Councillors requesting that they:

“hold a special meeting of full council so that councillors can scrutinise the financial implications of this project, ask questions on the information that has been put into the public domain, and get answers to show how the additional costs of up to £15 million will be paid for, and the impact that this will have on overall council budgets and service cuts, and the degree to which the project soaks up transport spending throughout the county for some years ahead.”

Read the full text of the letter and the background to the campaign to prevent a pointless, unaffordable and destructive scheme at: http://heyshamm6link.btck.co.uk/.

At the bottom of their hompage you can see an animated simulation of the proposed scheme with notes underneath showing some of the impact that the monster elevated road will have on the area as it cuts through the previously peaceful and much-loved local greenbelt in a massive embankment.