Chief Pleas trying to force ‘fire sale’ of Sark Electricity

The answer is as you should expect – badly.

One of the major differences between modern democracies and other forms of government such as autocracy, dictatorship, communism, etc, is the protection given to individuals and minorities.

Under a modern democracy, the majority is never allowed to take advantage of a minority and oppress it to benefit the majority. And when a proper government decides to nationalise a company, it leaves the purchasing to the civil service, who understand that they are required to be fair and reasonable.

But not in Sark. Sark does not have a civil service. Instead it is left to the politicians, who openly talk about getting ‘the best price for the people of Sark’ (the majority) but who have no idea about how to govern fairly, reasonably and in the best interests of all. They are in it for themselves, using the powers of government to try to force a ‘fire sale’ of the company. All with an eye to lowering their own bills today, rather than securing cheaper electricity for Sark tomorrow.

Every so often the mounting pressure from some quarter persuades the Chief Pleas committee that they must make a fair market value offer for the company. For a brief interlude, they pay lip service to this idea, waiting for the pressure to subside. Then they drop it, preferably blaming the company. The last time this happened they left us with a wasted £45,000 in legal fees spent negotiating honestly and openly. At least that’s how we approached it.

The next tactic was to introduce pricing regulation and appoint a commissioner in an attempt to force us to give up the company for nothing. We have seen how that went. Two years down the road, several hundred thousand spent on both sides, and due to the unfair and unlawful way in which they encouraged the commissioner to go about his job, we are no closer to cheaper electricity or the purchase of the company.

It seems as though, despite the positive sentiment expressed at the time of settling our court proceedings in December, we are in one of those interludes again. The committee has no intention of paying fair market value for the company and is trying hard to delay the process of valuing the company until the pressure ebbs away, again.

There is no need for valuation in any case. After the last interlude we arranged for an independent assessment of the company’s fair market value. The committee refuses to look at this and insists on conducting an unnecessary new valuation to let them include the damage to the company’s value caused by the attempt to bankrupt the company last year.

When they said they wanted to value the company, we were fully aware that they had no intention of determining the fair market value of the company, but wanted to create a minimal value. So we insisted that any valuation should be a cooperative one, with two valuers - one appointed by them and one by the company. These would work together to agree on the value.

They are now trying to derail this process by insisting that the company pays for half of their costs, while their electricity price commissioner insists that ‘the electricity customer should not be asked to pay for this.’ It is delightful to find something on which we completely agree with the commissioner. This is a government boondoggle and the government should pay for it, not our customers.

So we tested them. We offered that if they would pay these costs upfront, we would deduct 150% of these costs from the fair market value purchase price. This would give them the costs back and a 50% bonus. But only if they go through with the deal. Sadly, but unsurprisingly, the committee have rejected this offer as they clearly have no intention of purchasing the company at fair value.

This is all very sad. My father spent half his life on Sark and invested millions of his own money to change the power station from something that could be heard at the other end of the island into an operation that can barely be heard outside the door. He removed the Third World appearance given to the island by the wires drooping to every house. My son and I completed this by removing the final loop of wires that ran around the edge of the island. I have now spent 12 years running the company and completing this work and have put in almost £500,000 myself.

All of this has been done at our own commercial risk and expense with no government help, subsidy, access rights or protected status. Neither I nor the shareholders are willing to let a Chief Pleas committee steal the results of our family’s hard work and investment.

Chief Pleas has a constituency with a higher concentration of millionaires per square mile than any other in the British Isles. Yet they have the audacity to complain, ‘We have no money. We want to own your company to reduce our electricity price but can only afford to pay scrap value’.

That will not happen.

DAVID GORDON-BROWN

Director, Sark Electricity.