How administrators can avoid redundancies short-term

There have been many questions about the unusual circumstance in football of Rangers going into administration but not making any players redundant.  It is possible, and not totally uncommon, for directors of a company in administration to arbitrarily choose to provide funds from their own resources to pay any chosen creditor, including staff. In football, players’ contracts of employment need to be with the club, but the source of payment can come from anywhere.

In this instance, Rangers Group, the club’s holding company, or any other body or person, could be in sufficient funds to provide the administrators with enough money to not only pay players, but to continue operating in a relatively normal state.  Rangers’ administrators have already suggested Craig Whyte has guaranteed to make-good wages due to be paid this week, although it was not made clear which entity would be paying, or the source of such funds.

Administrators will only be forced into player redundancies if they do not have sufficient funds available to see them through to the timely conclusion of negotiations with creditors, or if they are unable to receive binding undertakings from another source that they will step forward to pay players next month.

Various sources over the weekend suggested HM Revenue and Customs were prepared to extend generous time to pay terms to Rangers.  This club is owned by Craig Whyte.  While we all know what a stand-up guy Craig is, how likely to you think HMRC are to believe he will stick to a plan stretching out years into the future?  It’s just not going to happen.

I hear a ‘We’ll take a few years to pay too’ campaign is set to trickle through the SPL if HMRC agree to this one.  Better using the tax man as a bank than using an actual bank.

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1072 thoughts on "How administrators can avoid redundancies short-term"

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  • jude2005 is Neil Lennon \o/

    gj

    Worserurr and worserurr even!!! lol

  • RalphWaldoEllison-is Neil Lennon Season 2011-12

    Neil Lennon says NO to BESNA!! says:

    20 February, 2012 at 15:05

    Cheers for that.

    I must have missed it in my haste to try and catch up on the backlog blog.

    (From the last thread) a post spoke of how if they go bust the RFC fans who sing their filth will also wash up at other clubs, especially when we’re playing them.

    The campaign and violence against NL last year uncovered a groundswell of complicity from across Scottish society for the anti-Lennon festival.

    More and more, it seems that there are many Scotlands. The tourist’s Scotland, the Scotland Scots export to England, the Scotland that a small number want and hope it can be, and then there is the small minded, inward looking, hegemonic Scotland that revels in high doses of cognitive dissonance. They celebrate hypocrisy and discrimination and paint it up as culture.

    Salmond, we have a problem.

  • The Battered Bunnet

    If Whyte’s plan was a simple hedged punt on the big tax case, and he still has cash enough from his various wheezes to keep them going in some shape for the next few weeks, I’d expect him to provide the cash required on a scaled down basis.

    Whyte’s singular motivation in all of this was and remains profit.

    I suppose he’s got a decision to make now: Stay in the game, or stop throwing good money after bad.

    Which option is likely to be most profitable?

  • Joe Filippis Haircut

    Voguepunter. Thank you for your answer, well as we know they took the Knighthood off Fred Goodwin I can see no reason why Murray should be allowed to keep his if Rangers are found guilty of tax evasion. He as chairman was in charge when Rangers chose not to pay her majestys the tax that was due to them we must await the outcome of the case but if as expected Rangers lose the case constant pressure must be put on the media to ensure Murray doesnt walk away scot free.H.H.

  • Paul67

    St Martin’s Bhoy, v difficult to get work done recently.

    Billy’s Bhoy, yes, there is an air of inevitability.

    Folly Folly, ha.

    Awe Naw, inserting an occasional space will suffice.

    ibleedgreenandwhite1, no probs, you copied and pasted something from elsewhere.

    mickthetic, sure will, thanks.

    ASonOfDan, football is a bizarre business.

    BlantyreKev, your scenario cannot happen in football. If players were contracted to a holding instead of the club, any game one of these players competed in would result in a 3-0 forfeit.

    ArranmoreBhoyLXV11, not so good at marriage counselling.

    Kojo, I don’t see it happening.

    Uncle Fester, deleted, language.

    Celtic Mac, good call.

  • BromleyBhoy

    Paul67,

    Think we would be incredibly foolish to raise some kind of campaign to not let Rangers pay their debts over 10 years.

    Frankly, they would be absolutely crippled by paying >5 million a season (assuming they lose the big case).

    I can’t think of anything more delightful!

    Then we would see the so-called GoD at last.

    If I were HMRC I would ensure that they kept visibilty over future cash flows – perhaps a seat on the Board? – to ensure that they didn’t stray back into ‘bad habits’.

    Them being made insolvent and walking away from their debts as a NewCo would simply not have the desired affect… so please be careful waht you wish for.

    B

  • jock steins celtic

    TBB – by using the Ticketus deal to fund his purchase and then not passing on the PAYE I don’t see how Whyte was planning to be in it for the long term ie next season.

  • Kojo

    My dear,dear,dear,friend.. Awe Naw

    Pal.. yer Astuteness knows Nae Bounds!

    Ye hiv jist Gubbed the Nub o’ the Problem, which , even a Relieved and
    Bloodied… but Unwashed… Survivor, from it’s nasty Bout of Administration
    Sickness…such as oor Hateful Rivals…. wull still hiv tae face.

    and that is…

    The Loss of this League Championship.

    Fur that means..

    Nae Chance of Engaging, fur them… in the Lucrative Euro Championship League..

    And .. this wull be a Devastating Blow tae them, no question aboot that.

    The Loss of A Ten Million Addition tae their Coffers ..wull.
    ensure that next year they wullnae be able tae Buy any New Players of
    Note.

    And.. Ah dinnae need tae elaborate, any further.. as tae
    How Crippling tae The G.A.’s Chances a Winning Next Season’s League Championship…That.. Wull be..

    A Troubled an Impecunious Future..is whit Ah predict fur oor Hated Rivals.

    Kojo
    yer pal..who likes ye aloater

  • South Of Tunis

    The Battered Bunnet @ 15 01

    ” There is no loan ”

    Correct . Ticketus are owned by Octopus . Octopus do investment. They want a return . They will not have invested money in something as mercurial as the potential value of a ticket to an entertainment event without having secured their ass to the value of the original investment plus an allowance for inflation . I assume Octopus will have secured an agreement which says — ” the fewer tickets sold-the more we get of something else.”

    The question is what security did Octopus take ?.

    Liquidation is still a possibility .-at that point The Floating Charge becomes a Fixed Charge.

    Drip Drip Drip.[ into whose pocket ? ]

  • Lardo66

    Jeez Vogue, that’s some story. Are you ok?

  • voguepunter

    Lardo66 says:
    20 February, 2012 at 15:35

    I am as ok as the mentally challenged can be :O)

  • Philbhoy – It’s just the beginning!

    Voguepunter

    Just catching up as usual.

    What a post!

    Keep it up!

  • pheersy

    follow follow thread on the rangers fan lifted for sectarian singing… most replies giving advice of “deny everything and it will be hard to prove..one classic reply as per below :

    not if ten of his mates who were with him all stick to their stories and say that he was singing Celtic Blood because they know to sing fenian blood is wrong

    then 10 > 2

    not guilty or NP at worse

    Last edited by Russell_Nash; Today at 15:29.

  • bigphil47

    Am I right in saying if we win all games between now and March 25 and the nasties drop 5 points we win the title the week before we go to da big house. bigotdom. If so can we please get the presentation at Iroke LOL

  • jock steins celtic

    At this point no one seems to be making public the full details of the Ticketus deal but it seems they paid out 24 Million for something ‘worth’ 40 Million. To get a deal as sweet as that there might be some risk to Ticketus involved in it.

  • Joe Filippis Haircut

    South of Tunis. You are indeed correct Octopus have lent Rangers or Whyte 24 million and they will want a return of much much more than the 24 million once they have there interest added.Now I said this last week and nothing has happened to change my mind Octopus will have some form of security not the season tickets for the next four seasons as the monies from the season tickets is the way Rangers or Whyte prepose to pay them back. So at the moment the administrators are dealing with 9 million unpaid tax and 24 million missing from ticket us by the time interest is added it will be over 40 million I would guess and that is before the court ruleing on the big tax case is decided.H.H.

  • Lardo66

    Vogue, Ar ar ar!!!

  • The Battered Bunnet

    jock steins celtic

    The plan as I see it was to run through to the outcome of the big tax case.

    If Rangers win, he gets a £40M business for a £1.

    If Rangers lose, he gets his money back plus the interest he’s been charging on the funding provided, and runs away pretty pleased with his work.

    He expected the tax case to conclude in November. In my view, it looks like the continuation through to January has presented a cash funding problem from him.

    By hitting Adminstration now, he can cut cost out of the operation while awaiting the decision in March/April.

    That seems to tie in with what we know currently.

  • Gene’s a Bhoys name

    Re the vile singing at Ibroke’s on Saturday – surely the match commander and SPL rep will be writing to the appropriate bodies

    won’t hold my breath

  • Kojo

    Sir Paul

    Straight frum the Get Go…and even afore ..That!

    Baith You and Ah .. saw.. that Whytey wiz an Opportunist.. no

    a Redeemer!

    Especially, as he also brought oan board, wi ‘ him.. his Partner in
    Thievery.. the Slimy Eel-like ..Ellis!

    This Ellis, is No a Jist a Bad Apple.. He is a Rotten Wan!

    And..

    Everything, which we Suspected and Mair..has Unfolded, Exactly… as Those Two
    Connivers wud hiv Planned.

    Noo, whit the Eventual Denouement of This Nefarious Plan, which wiz
    hatched and carried oot..by the Evil Twins…

    Ah canny .. Foretell..or even attempt tae Vizualize.

    Fur..

    Basically, Ah am Faur too Honest a Guy, tae.be able tae fathom..

    Jist Whit.. Whytey and Ellis are Aimin’ at.

    Howevahhhhh..

    Ye kin bet ye boattum Dollah.. that whitever the Eventual Ootcome of this
    Farrago o’ Broken Dreams and Promises,which hiz bin Visited oan the Ibrox Club,by these Two Snakes…

    Wull… Somehow ..

    BE…tae the Financial Advange of These Two Evil Doers.

    Kojo
    Yes, Planned…

  • Neil Lennon says NO to BESNA!!

    RalphWaldoEllison-is Neil Lennon Season 2011-12 says:
    20 February, 2012 at 15:26
    Neil Lennon says NO to BESNA!! says:

    20 February, 2012 at 15:05

    Cheers for that.

    I must have missed it in my haste to try and catch up on the backlog blog.

    (From the last thread) a post spoke of how if they go bust the RFC fans who sing their filth will also wash up at other clubs, especially when we’re playing them.

    The campaign and violence against NL last year uncovered a groundswell of complicity from across Scottish society for the anti-Lennon festival.

    More and more, it seems that there are many Scotlands. The tourist’s Scotland, the Scotland Scots export to England, the Scotland that a small number want and hope it can be, and then there is the small minded, inward looking, hegemonic Scotland that revels in high doses of cognitive dissonance. They celebrate hypocrisy and discrimination and paint it up as culture.

    Salmond, we have a problem.

    No probs…
    Im guilty myself of missing the odd page or 2 to catch up.

    No doubt der hun fans would follow us around to sing secterian abuse, im pretty sure they do it just now.

  • malceye

    “we don’t do walking away – we pay our dues”

  • ‘crushed nuts?’ ‘Naw, Layringitis!’

    Irrespective of whether the Govan Glee Club get time to pay, they will still continue to attract debt.
    The sanctimonious rubbish coming from ‘Blue Knights’, politicians and the LL is exactly that!!

    As a company they’re bust, the brand is toxic, years of living on other people’s money is taking its’ toll.

    Couldn’t happen to a nicer bunch!

  • wonkyradar

    There must be a lot of engineers amongst us – also many busy hands- if we have the will( i know we have) then we could construct a gigantic blender and liquidize whats left of them? We could then petition to place the remaining detritus in a rocket & dropkick them into space.

    Am i being overly idealistic?

  • 31003

    VOGUE

    What a post sir….I doff my cap to you…..one of the best I’ve read…….I’ve e-mailed that to thousands….and don’t worry….I’ve stuck your name on it so people don’t think its mine….(not that they would)

  • Celtic Mac

    Paul67et al

    The campaign currently under way, led by Roddy Forsyth from Ayebroke at the weekend is based on a remark from one of the Administrators (Paul Clark?) that if the HMRC had wanted to close down Rangers they would have applied for a winding up order. The logic being that that they did not, so therefore they must want Rangers to continue to exist. Except that interpretation ignores the fact that the HMRC is also awaiting publication of the Tribunal decision re Rangers’ appeal against the £49 million liability for misuse of EBTs. HMRC does not want Rangers to disappear before that ruling is published. An average family in Scotland which receives working tax credit will lose up to £4000 pa as from April. The reason being that Government expenditure exceeds current revenue receipts. Rangers are part of the problem but not part of the solution. If unable to meet liabilities to the HMRC they will be liquidated. Let us make sure we get that message across!

  • South Of Tunis

    Joe Fillipi’s Haircut – @15 47.

    Ticketus sell tickets at a profit .

    I imagine they allowed for what they might be selling —-?

    Rangers – Barca
    Rangers — Real Madrid
    Rangers – Celtic
    Rangers -ICT
    Rangers -Ross County
    Rangers Cowdenbeath
    Rangers — East Stirling .

    If they aren’t making money from ticket sales — Ticketus/ Octopus will want to be able to make money from something they can sell or rent out.

  • Malorbhoy

    Awe Naw

    Good to see from your post that you will be over in May, have you contacted JC ,as the last time i was up we were talking about meeting you and going for a meal,game the next time you were over

  • Gordon_J backing Neil Lennon

    The Battered Bunnet @ 15:48,

    That’s pretty much my take too: Whyte expected European income to last until the Big Tax Case reported.

    But they got put out twice and the result was delayed, so he now has to put in some cash to keep things going.

  • The Battered Bunnet

    Gordon

    Bummer, eh ;¬)

  • The Honest Mistake loves being first

    South Of Tunis 20 February, 2012 at 16:02:
    I think I read somewhere that Octopus had insurance against certain scenarios.
    No doubt a tax payer owned financial institute will take a hit down the line.

  • bjmac

    Voguepunter

    outstanding!

    Hope you’re well, my friend ;-)

    hh

    bjmac

  • voguepunter

    31003 says:
    20 February, 2012 at 15:58

    Thank you very much Sir,but I did not write it .
    Will take the credit for being able to cut and paste.:O(

  • !!Bada Bing!! Kano 1000

    pheersy says: 20 February, 2012 at 15:40 follow follow thread on the rangers fan lifted for sectarian singing… most replies giving advice of “deny everything and it wil be hard to prove..one classic reply as per below : not if ten of his mates who were with him all stick to their stories and say that he was singing Celtic Blood because they know to sing fenian blood is wrong then 10 > 2 not guilty or NP at worse Last edited by Russell_Nash; Today at 15:29
    the halfwit Gordon Waddell wrote an article a few months ago saying “up to their knees in Celtic blood” was perfectly acceptable.Should have been sacked.

  • voguepunter

    You lot are at it now .

  • bjmac

    Are the hunministrators having a presser this afternoon?

    hh

    bjmac

  • EKBhoy

    The Battered Bunnet says:
    20 February, 2012 at 15:48

    I agree with your comments, CW will be extracting pots of money out of Dignity through various interest charges , fees etc, why go to the bother of stealing illegally , when he can just rip them off legally.

    One point that is nagging me is that if the Holding company is set up with the whole purpose of ‘managing’ the club, I am not sure how keeping a pile of cash in the holding company works when putting the operating company into administration.

    Where is an accountant or lawyer when you need one?

    Did Southampton not get done in the opposite circumstances when the holding company went belly-up, they argued that the club was separate, only to be told , no?

    Crystalballcfc

  • gscbhoy

    Gee whizz, Wigan report losses of £7.2m for the year, and net debts of £72m. Turnover only £50m (an increase of 16% since last year) and wages, wait for it, now 78% of turnover

    Their Chief Exec is making positive noises, but if they are relegated, surely they are in the grubber?

    Could be worse, at least they appear to be paying their taxes

    See BBC Sport report

  • greenjedi

    Russell Nash was Connor MacLeods name in late 20th Centuary New York!!!

  • bunburybhoy

    voguepunter…
    Absolutely stupendous cut ‘n pastin’ mate!
    HH

  • Malorbhoy

    BJMAC

    Great photographs yesterday, what fast train were you on to get there?

  • !!Bada Bing!! Kano 1000

    Techy question,got email from Sky saying broadband limit exceeded for last month.If you have your laptop on “sleep” mode, with sites still open, does it still use up your allowance?thanks in advance.

  • bjmac

    Vogue

    ya rascal, trying to take the credit for something ye simply cut and paste :-))) now if that was Auldheid I could understand him getting the praise – for managing to cut & paste ;-)))

    Still hope you’re well :-)

    hh

    bjmac

  • voguepunter

    BJMAC

    Would you repost your photies please,did not work earlier.

  • oglach

    bunburybhoy says:
    20 February, 2012 at 15:44
    Plod must have been on CQN!

    ———————
    I admit to being amazed by this. I honestly believed that there was no way they would countenance this scenario. We live in strange times indeed.

  • ASonOfDan

    As voguepunter has stated already, he was merely copying the article for us to view. This is the original article.

    http://www.europeanexaminer.eu/

  • wonkyradar

    BromleyBhoy can’t see that lot abandoning their “proud” history- its all part of their “dignified” heritage- under any circumstances short of the full 24 carat apocalpyse now scenario…they’ll take their cups down with the Lusitania…

  • Gordon_J backing Neil Lennon

    The Battered Bunnet,

    The best laid plans …

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