IT is important that the real issues behind the decision by Hamilton Accies' supporters to field a candidate in the Hamilton South by-election are understood.
The club is 97% owned by a consortium called Deeka, set up and organised by local accountant, James Watson, a former Chairman of the club. Deeka transact no business and don't make anything. As publicly stated by Mr Watson, they exist purely for the purpose of selling
tax relief.
The way it works is that investors, after buying shares in Deeka, are allocated a shell company by Mr Watson. They then sit back and wait for the annual consortium tax relief to arrive. If you own 10% of Deeka, you get 10% of the losses made by Hamilton Academical each year. This tax credit is applied to the investor's individual tax code, allowing them to reduce the amount of tax paid on other income. The best bit is that this relief will roll in for every year that Accies make a loss. The investors don't, above all, have to invest any money in the football club.
Consequently, it is not in the interests of these people for the club to prosper. In fact, they make far more money if the club is doing badly. Occasionally, when the losses have accumulated to such an extent that the bank manager is getting anxious, players have to be sold to balance the books.
This systematic asset-stripping is perfectly legal. However, I would question the morality of it. A famous old club like Hamilton Academical should be a source of civic pride and a focal point for the community, not a tax-efficient plaything for a bunch of local businessmen.
As it stands, Accies have been away from the town for over five years and crowds have dwindled to an almost fatal level. Unless they can be returned to the town in a new stadium without Mr Watson and his placemen then I fear for their long-term future.
Gilbert Mowat,
16 Aspen Way,
Hamilton.
September 24.
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