BHT UPDATE ON BEMBRIDGE HARBOUR PLANNING ISSUES 13 JULY 2017
Introduction
On 4 July 2017, Malcolm Thorpe widely circulated a paper that he had prepared in which he covered a number of matters that we had raised in our 23.12.06 professionally drawn up report for the Planning Officers on the finances of the Harbour Company and its group companies. The need for this financial report was to draw to the attention of the Planning Office matters that directly relate to flaws in Mr Thorpe’s “enabling development” argument that we believe disadvantages the Harbour.
IWC planning officers agreed they needed full answers to the questions raised in the context of the application.
Mr Thorpe has used an “enabling development” proposal because his planning application to build houses on the St Helens Duver Works site and the Bembridge Marina site would otherwise fail as it breaches planning policy, not least on placing households in the flood zone, outside the settlement boundaries and involves housing types that are contrary to the requirements of the Local Plan.
Mr Thorpe describes the proposals as a “regeneration scheme” for the Harbour. Any review of the application makes it clear that this is fundamentally a residential development with 86% of the floor space housing. The Harbour sees minimal benefit. Such marine residential schemes are very popular with developers as they assure a premium sale price, a robust specialist market even in lean times and a corresponding high profit.
There is much in Mr Thorpe’s paper that we disagree with or is incorrect or has an element of spin that needs straightening out. It is unfortunate that we have to go back and forward like this as clearly more openness would be helpful. BHT has now responded in detail to Mr Thorpe’s Paper, sending this to local Councillors, Mr Thorpe and a few other organisations that we believe were sent copies. We are seeking to establish whether it was also made as a formal submission on the planning application, in which case we shall respond in that forum too.
BHT Trustees have recently met with Mr Thorpe and Local Councillors to seek an amicable way forward with the future of the harbour business after the planning application is determined, and we all look forward to working together (along with all other stakeholders) but the air must be cleared, as there is no place for secrecy in a cooperation.
There is a lot of detail in our response as the Planners and other officials need to have updated and corrected information. The document is unavoidably long. We thought you might prefer a brief summary and some background for context here, the full response is here should you wish to consider it.
Some of the key matters that are going on are:
1 It is understood that the Planners have the given the applicant, Bembridge Investments Ltd, the opportunity to submit more information before their Counsel finalises his advice and report to the Planning Committee is produced. This may be in time for the Planning Committee meeting on 1 August but this is looking increasingly less likely.
2 The Bembridge Harbour Act of 1963 sets out rules as to how Harbour income should be used for the benefit of the Harbour. One of the matters in dispute is how these rules have been followed. In particular, that under the Act the income from the Harbour business should be invested in the Harbour and not used to pay off other group companies debts.
3 BHT in its legal financial report had asked the Isle of Wight Council to ask the harbour company 9 fundamental questions that had been suggested by experienced accounting professionals relating to the use of funds, and their availability for improvements. IWC consider that these questions have not yet been satisfactorily answered by Mr Thorpe. They are critical to any “enabling development” justification.
4 Mr Thorpe has said that he has “invested” over £1 million in the Harbour whereas the financial statements actually show £870,000 leaving the Harbour to his other companies. This is not explained.
5 It would appear from the income generated by the Harbour business and house boat sales that there is no need for a house building project at all. Certainly not for Harbour benefit. The Harbour can move forward very positively without that.
6 One of the problems for BHT and the IWC Planners is that the amount of published financial is very limited as the companies in the group only have to file “abbreviated” accounts which tell you very little. We have frequently asked for full accounts but Mr Thorpe denies them. It is difficult to see why he resists if he wishes to achieve the required openness to move these discussions forward. We remember the first public meeting that Mr Thorpe held on 31 January 2012, just after he had bought the business. He said then that one of the problems of the previous owner was that he was very evasive about disclosing financial information but he would stop that and hold annual meetings with full disclosure!
7 It appears that after 17 months of resisting a Section 106 agreement with an “overage” clause as required by Planners, Mr Thorpe now says that “he has no problem” with this.
8 The £945,000 of “harbour improvements” promised in the planning application do not go to the Harbour at all. They go to a private property company who will charge the Harbour rent for them.
9 It is also questionable whether the proposed Harbour improvements are even necessary or the Harbours priority needs for attracting new and retaining existing custom. If they are needed BHT believe they could be achieved by building fewer houses. Less houses displace less car parking and valuable buildings, so better visitor reception space and less unnecessary costs. In our view there is minimal local benefit.
10 Amongst many others, there is one very strange transaction over the sale of a houseboat plot which has been queried. The plot was sold by BHIC, the Harbour Company, for £1 to Bembridge Boat Storage. The very same day it was sold on to a third party, for £87,500 thus appearing to extract rightful income from the Harbour company.
11 There is a complex network of inter company loans that are concerning and are being queried. Some arise from the acquisition financing.
12 We questioned the costings put forward by Mr Thorpe in his planning application and organised an independent review by specialist surveyors. The conclusion was that they were grossly over stated showing a far lower level of profitability than might reasonably be predicted. We are puzzled as to why the later reviews of profitability have used the “highest build costs on the island” (according to the District Valuer) indexed to today, whilst sale figures appear to reflect normal speculative standard and have not been updated , despite a 9.15% increase in the local House price index since they were first proposed.
13 You will be pleased to know that BHUG continues with its project to repair the Bembridge Point Groyne which is receiving considerable local support and from the Harbour Company.
The Trustees of the Bembridge Harbour Trust
14 July 2017
Response to Mr Thorpe’s paper 04/07/17
Who are BHT? A registered Charitable Trust, with clearly published Objectives and wide membership of Harbour users and the community.
What have they got to gain? Money? No – members are barred from financial advantage.Power? No – there is just a desire for community-influenced, open management for the good of the Harbour and its dependent communities.
Are they secretive? They openly share information and invite comment and debate.
What is the quality of their information? It is properly referenced and supported by expert professional advice.
Why do they make such a fuss? Because the Harbour is a critical asset of the community, its economy and its social welfare.