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OSCR threatens trustees over reform…again

OSCR chief executive David Robb

CHARITY regulator OSCR has told Shetland Charitable Trust that its trustees could face suspension if they pull back from proposed reforms of its governance structure.

On Thursday trustees meet to finally approve changes that would finally remove Shetland Islands Council’s control of the trust, replacing it with a board made up of seven councillors and eight independent trustees.

There have been 68 objections to the reform plans, mostly concerning the loss of democratic control of the trust.

Trust vice chairman Jonathan Wills

Trust vice chairman Jonathan Wills has called for the proposals to be dumped and opt for a different structure where all trustees are elected. Click here for detail.

However OSCR chief executive David Robb has warned that would delay the process by at least six months, and could force him to step in and take control of the trust.

The reforms were agreed last December following a tortuous debate that resulted in the resignation as trustees of both former council convener Sandy Cluness and councillor Wills.

May’s elections brought in a new board of trustees, all of whom received a letter from Robb last month noting his “considerable disappointment” that some of them were now unwilling to proceed with the reorganisation OSCR itself approved in July.

He repeated the threat he made last year that if the changes were not sanctioned on Thursday, OSCR would have to consider stepping in to run the trust and suspend trustees for misconduct.

Trust chairman Drew Ratter

Trust chairman Drew Ratter said it was “absolutely bizarre” the trust was still debating the same issue after four years and urged trustees to approve the plan.

“I don’t want the trust to go on and on having to send all its documents in to be examined by OSCR. I want it to be operating and thinking strategically about what can be done for the benefit of the people of Shetland,” he said.

“I certainly don’t want to get into yet another extended period of naval gazing.”

On Thursday the trust will also propose removing all trustees from its subsidiary companies, including the one which manages its 45 per cent stake in the proposed £600 million Viking Energy wind farm.

The trust commissioned the Institute of Directors to carry out a review of the subsidiary firms, which include property company SLAP and district heating scheme operator SHEAP.

Ratter said the move would avoid conflicts of interest, such as those which held up the decision to invest a further £6.3 million into the Viking Energy development prior to the last council elections in May.

It would also ensure the companies were run on a more commercial basis and allow the trust to scrutinise them properly.

“I think it makes the whole task of being dispassionate and examining the performance of these companies much easier,” he said.

The suggestion is for SLAP and SHEAP to have three non-executive directors with relevant experience and skills.

The complex structure of Viking Energy involves three separate companies.

Viking Energy Ltd has responsibility for the trust’s financial stake in the wind farm, while Viking Energy Shetland LLP (VES LLP) is responsible for project development.

VES LLP is 10 per cent owned by Viking Wind Ltd, the partners behind the Burradale wind farm.

It is proposed that VES LLP would have five directors, who would also be chosen for their skills and experience.

VES LLP would have a 50 per cent share of the actual wind farm alongside power giant Scottish & Southern Energy plc, who between them form the Viking Energy Partnership.

Once the wind farm is up and running, VES and SSE would each have three directors.

The papers for Thursday’s meeting can be seen at here.

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