News / Trust adopts new governance rules
SHETLAND Charitable Trust (SCT) is in danger of looking “silly” if no councillors are put forward as trustees after next year’s council election, it was claimed on Thursday when trustees voted in a new governance set-up for the £230 million trust.
Trustees voted by six to two in favour of reducing the number of elected councillor trustees from seven to four as of June next year.
However, Shetland Islands Council has already decided that it would no longer put forward any councillors as trustees to avoid any potential conflicts of interest.
Reiterating his opposition to the changes, vice-chairman of the trust, council trustee Jonathan Wills said: “I don’t want the trust to look silly, but the way it’s headed, it will look silly.”
Chairman Bobby Hunter did not confirm if SCT had a contingency plan should there be no council trustees, but he said the issue will “evolve” over time.
Wills raised concerns that if no councillors are put forward next year, then SCT could consist of only 11 or 15 selected trustees, thereby creating a “democratic deficit”.
At the moment, seven of the 15 trustees come from Shetland Islands Council, with the other eight appointed.
“This isn’t a hobby horse of mine,” Wills said. “I’ve met a lot of people who are worried about it.”
Campaign group Democracy For Shetland Charitable Trust said in a statement before the meeting that the trust was in danger of coming an “unaccountable quango” if it does not have a public consultation on its governance.
Wills suggested sending back the document – which was coined by legal company Turcan Connell – to be revised, or to wait until the next council is elected in May to see if there is a change of heart.
However, James Smith warned against delaying the governance shake-up that long. “It needs a bit of trimming, but that can be done later,” he said.
Andrea Manson supported Wills’ calls, saying the trust “needs some sort of public accountability”.
The Shetland North councillor backed the vice-chairman’s motion to send the proposal back for further discussion, but it was outvoted.
The governance document included new wording to state that the total number of trustees will be “up to 15” to provide “flexibility” should there be no councillors put forward in May.
Meanwhile, the annual report for 2015/16 showed that the funds held by Shetland Charitable Trust shrunk by almost £8 million to its current value of £232.8 million, mainly due losses on the global money markets.
Its investments only returned a total of £1.1 million, or 0.5 per cent.
The report revealed that £3.6 million was earned through local investments, held mainly by property arm SLAP, but also through Shetland Heat Energy and Power Ltd and the land owned at Sullom Voe.
Charitable expenditure to a raft of local organisations was at £9.4 million in 2015/16, an amount the trust aims to reduce to £8.5 million by 2020.
As of 31 March 2016 he trust had invested £8.9 million in SCT Renewables, the company that holds a 45 per cent stake in the Viking Energy project, which aims to build a “very large wind farm” in the central mainland.
Chairman Bobby Hunter said the trust has faced “significant challenges” in recent years, including reducing spending to a “sustainable level”.
“During the year the value of our investments on the financial markets fell, although they have since recovered, underlying the fact that we view these as long-term investments and that we need to remain prudent.”
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