Westcombe Engineering – Councillor Slams VAT Error

taxman07:22 Monday 17th June 2013
Bigger Breakfast Show
BBC Radio Cambridgeshire

[P]AUL STAINTON: The future of jobs at a Peterborough engineering firm is looking uncertain after a serious accounting error. Westcombe Engineering, which is controlled by the City Council, failed to pay half a million pounds in VAT. The cash has now been repaid in full, but the Council has announced a consultation that puts two posts at risk of redundancy. The workforce there is largely made up of individuals with disabilities. .. Mike Fletcher is the Independent councillor in Peterborough. He’s fought to keep Westcombe Engineering open in the past. Morning Mike.
MIKE FLETCHER: Good morning Paul.
PAUL STAINTON: Are you shocked to learn there could be some redundancies here.
MIKE FLETCHER: It’s very sad news. Making a cock-up like they have done and then wanting to make the most vulnerable disabled people pay for it is absolutely shameful. What I would like to have, and we haven’t got it now, but is the time to talk about the whole core of rottenness that I found surrounded Westcombe.
PAUL STAINTON: Well let’s not get into that right now, because obviously we’d need to go through ..
MIKE FLETCHER: It’s awful.
PAUL STAINTON: … yes let’s not make any accusations that we can’t sustantiate at the moment.
MIKE FLETCHER: I can. I can substantiate it Paul.
PAUL STAINTON: Well we’ll talk .. we’ll talk further another time, but right now, this is the issue that is most pressing. The Council will say that if they had accounted properly in the first place, then to run the business, and even to break even, they would have needed to have employed less staff anyway.
MIKE FLETCHER: I can’t see that. They’re blaming the self-billing system. I’ve been doing VAT returns for over 30 years, and I’ve worked with companies that operate self-billing schemes, and it’s no different to a normal invoice and statement scenario. Your VAT is defined, and you pay that VAT at the end of the month, or the end of a quarter, depending which scheme you’re on.
PAUL STAINTON: Yes but evidently somebody’s made a mistake here. Somebody’s made a mistake. I think what the Council’s position is is if they hadn’t made that mistake, they would have had to do their sums slightly differently, so they perhaps wouldn’t have had all of these jobs anyway.
MIKE FLETCHER: They should have had those jobs. Paul, I need to go back in time just a little bit.
PAUL STAINTON: Well don’t make any accusations anyway.
MIKE FLETCHER: No no no. Ok I won’t. Off the back of Westcombe, when we were cleared out, another company was set up that now employs over 30 people and is quite profitable. That business could have all gone into Westcombe, expanded it, and been good for Peterborough, good for the disabled people.
PAUL STAINTON: But when the Council took Westcombe over, it was in liquidation, wasn’t it?
MIKE FLETCHER: They forced us into liquidation. As I tell you, they worked actively against us. I can prove all this. I’ve still got all the papers, and fortunately I was going to throw them out only two or three weeks ago. But I’ve still got them.
PAUL STAINTON: Well the Council right now are not here to defend themselves, so let’s just leave that to one side for now.
MIKE FLETCHER: Yes. Fair enough.
PAUL STAINTON: The jobs here, for the people working at Westcombe, they’re the things to worry about.
MIKE FLETCHER: Of course they are. Yes. And they should explore every possibility of expanding that business, or making enough work for its people. There’s no reason why they shouldn’t. Let’s not be wrong about this. They’ve had four consultants, or interim managers, down there since I left. And now we’re in the stage where they’re still losing money. It’s just a ridiculous situation.
PAUL STAINTON: Yes. And of course there’s the half a million pounds that the taxpayers have to find.
MIKE FLETCHER: This is correct. And so where are they going to find this from? They say that it’s because the Council are not used to running a manaufacturing business. This is the same people who want to run the solar farm for God’s sake. If they can’t run this little business, how on earth do they think they’re going to make a solar farm profitable?
PAUL STAINTON: What should happen in your view, right now?
MIKE FLETCHER: They should call somebody in. The person we brought in to run the place, a proper expert who knows what he’s doing with an engineering works, bring him back, and let him sort it out.
PAUL STAINTON: That’s the councillor who was very interested in Westcombe Engineering before it was taken back into Council control Mike Fletcher, Independent councillor for Peterborough.