Roadchef Employees Benefit Trust

Patricia Gibson Excerpts

Tuesday 19th December 2017 Commons Chamber

[Neil Gray (Airdrie and Shotts) (SNP)]

Thank you, Madam Deputy Speaker, for granting this debate. I thank the hon. Members from across the House who have so far agreed to stay back to listen and perhaps contribute to the debate. What I am looking to discuss this evening can be boiled down to basic fairness and people getting access to what is rightfully theirs. I think it is important to set out some context to where we are today, before I come to the main points that I hope the Minister might be able to help with.

In 1986, the Roadchef employees benefit trust was established to give employees at Roadchef motorway services, such as those at Harthill in my constituency, Watford Gap, Hamilton or dozens of other locations across these isles, access to a John-Lewis-style employee-ownership scheme, whereby they would benefit from increasing share entitlements based on length of service. It was established honourably by the then chief executive Patrick Gee in consultation with and with the support of the GMB union. Sadly and tragically, Patrick Gee died aged 43 before the scheme could be fully realised and Tim Ingram Hill took over. He then transferred the shares that Mr Gee was making available to employees into a second employee benefit scheme, of which he was the only beneficiary.

When Roadchef was subsequently sold to the Japanese company Nikko about a decade later, Mr Ingram Hill made approaching £30 million on the shares that should have been made available to Roadchef employees. In 2000, he made a tax payment on his ill-gotten share windfall to Her Majesty’s Revenue and Customs to the tune of approximately £10 million, something which has only to come to light further down the line. On discovering the unjust enrichment, the trust then took Mr Ingram Hill to the High Court, and Justice Proudman found that he had acted in breach of trust and, crucially, that the shares were never his in the first place—they were the employees’ shares. The purchase of the shares in the sale of the company was therefore void and—this is important—the £10 million paid to HMRC also belonged to the beneficiaries, not Mr Ingram Hill.

Subsequent to the High Court ruling, Mr Ingram Hill settled with the trust, thus ending our interest in him for the purposes of this debate, but the trust then notified HMRC of the fact that the settlement had occurred and that it now intended to pay out to its beneficiaries, who total some 4,000 current and former Roadchef employees. The trust also wished to clarify that there would be no tax implications from the payments being made, thinking that that would just be a formality, but the response from HMRC was rather surprising. HMRC said that it would be happy to waive any tax implications for the beneficiaries as long as the trust did not pursue it for the £10 million paid in tax by Mr Ingram Hill. That was the first time that the trust had been made aware of such a tax payment. In accordance with any trustees acting on behalf of beneficiaries, the trust has challenged HMRC on the £10 million payment, which should be repaid to the trust with interest. That brings us up to date on this complex and unique case.

I am grateful to the chairman of the trust, Christopher Winston Smith, and to Huw Edwards for their insight ahead of this debate, and to the current CEO of Roadchef, Simon Turl, who I spoke to last night. Roadchef wants the issue settled for its current and former employees and has been working constructively with HMRC to that end. The trust has also worked with a number of hon. Members from across the House to raise the matter with HMRC, including my hon. Friend the Member for Linlithgow and East Falkirk (Martyn Day) and the hon. Members for Newport East (Jessica Morden), for Newcastle-under-Lyme (Paul Farrelly), for Congleton (Fiona Bruce), for Stafford (Jeremy Lefroy), for Dudley North (Ian Austin) and for Westmorland and Lonsdale (Tim Farron).

My constituents certainly want this issue settled. Twenty constituents, most of whom live around the service station at Harthill, have contacted me about the matter, but I am sure that more are waiting for their payment. They include Mrs Margaret Gibson, who lists some of the things that she has struggled to do in recent years that this money would have helped with, including borrowing money for home improvements, helping her son to pay for his wedding, or helping her and her husband to get by during periods of unemployment. She considers it a ridiculous amount of time to wait for what is rightfully hers, and I completely agree.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

My hon. Friend is making a powerful speech. Does he agree that what adds insult to injury here is that, as well as being deprived of the payments, many of the people concerned are also working on quite low pay?

[Neil Gray]

Absolutely. I believe that the main thrust behind Mr Gee’s setting up of the trust in the first place was to ensure that low-paid staff were able to benefit from the company doing well. That has sadly not happened yet, and many low-paid workers have suffered as a result. Many of my constituents—I will list some shortly—have suffered and continue to suffer as a result of the payments not being made, so my hon. Friend is absolutely right.

Linda McLeod and Margaret Main pointed to the time it has taken for their money to be returned, but they also highlighted the number of former colleagues who have sadly passed away and will not get the benefit their hard work merited. Caroline Todd contacted me on behalf of her mother, Mrs Quigley from Harthill. She desperately hopes this gets resolved soon so that her mum, who is getting older, is able to enjoy her own money. Margaret Forsyth just wants HMRC to settle matters so that she can have some security, a sentiment echoed by Jane Paxton and Elizabeth Campbell.

Joyce Simm’s husband has been receiving treatment for small-cell carcinoma for three years, and she has been out of work while she cares for him. They have had to survive on pensions and savings, which are fast disappearing. They have now been hit with the sad news that he has a carcinoid tumour and will be undergoing surgery on 21 December. I am sure the whole House will join me in wishing the family well, but clearly any pay-out now would be particularly beneficial.

Another constituent of mine visited my surgery. He is seriously ill and in a difficult financial situation, and the money he is entitled to get back would simply be life changing and would help him immensely. He is desperate to see HMRC settle as soon as possible. I know many other hon. and right hon. Members on both sides of the House will have constituents who are affected and, sadly, will be able to share similar stories. Indeed, I understand Mr Speaker has constituents who are affected by this issue.

It is worth mentioning someone else who has been affected by this case. The former company secretary at Roadchef, Tim Warwick, blew the whistle on what the then chief executive was doing before there was any kind of whistleblower protection. Exposing this affair effectively ended Mr Warwick’s career, and we should all thank and pay tribute to him for his efforts.

What can the Minister do to help my constituents and their 4,000 colleagues across these isles who are waiting for their money? I understand that HMRC is a non-ministerial department of Government and that the Minister is therefore somewhat restricted in what he can do, but I hope he can join me and colleagues on both sides of the House in calling on HMRC to settle this case with the trustees and to return the £10 million, plus interest, to the rightful owners—the trustees and beneficiaries.