Another stay of execution
ON a Wednesday morning, the Rolls building, just off the Strand in central London, is where companies go to die.
On the morning of 17 May 2023, the insolvency and companies court, sitting in court 30, hosted more than 100 cases whereby HMRC demanded payment via winding up petition. The majority of these, often for a matter of a few thousand pounds, were settled in seconds. A simple statement by the judge that a compulsory order — an order to liquidate the company, often unrepresented — was granted in response to a request by HMRC’s prosecutor. Someone’s hopes and dreams, killed in seconds. It is a clinical and unemotional environment.
While we waited the turn of Southend United Football Club in the public gallery, representations were made by two company directors. One arguing a point of order and successfully winning a few extra weeks to pay his dues, and another, sadly, confessed his inability to pay. The judge thanked him for his frank and honest representations, and brought the curtain down on his business. The director nodded in resigned deference, and sat back down.
At 12.14pm, the file of our city’s football club, formed in 1906, whose ground had been built by its own supporters 68 years ago, were 2006 League One champions and are the only English club to have a 100% record over Manchester United, was passed before Judge Mark Mullen. That sentence doesn’t read very well, but trying to sum up a 116-year history in a few words is a neat metaphor for what was playing out in court.
It was the 19th time the club had faced off HMRC in this arena since Ron Martin became its chairman in September 2000. If the directors of those ill-fated companies who had gone before had seemed nervous and cowering, Martin sat in the public gallery unfazed. It is, after all, one of his business tactics to use HMRC as a bank and not to pay his dues until they really are due. The trouble is, recent years have shown that the well is running dry. Supporters have long speculated about where his money actually comes from, but only recently, in the last couple of months, has he accepted that he has to sell the football club to avoid mutual destruction.
The winding up petition on Southend United FC, originally for around £375,000, was served on 3 April. During the time between this and the petition being made public in the London Gazette on 4 May, the club continued to sell season tickets, vastly increased in price from the previous campaign, to unknowing supporters. In the weeks leading up to the petition, there was no communication, no statement, no reassurance. A truly appalling way for a community football club to treat its supporters. In the absence of any kind of acknowledgement of this potentially fatal court hearing, I turned up alongside four other supporters and the only journalist that saw fit to attend, Chris Phillips of the Southend Echo.
The few mutterings that have emerged from the club in recent weeks, although not via official channels, have blamed the latest financial issues on fans for not buying enough season tickets — as if it never occurred to them that the sabotage of the last four seasons by off-pitch problems was enough to make some people think twice about laying out the best part of £400 that they might never see again. This is of course a football club that, in 2021, blamed its fans for not being able to submit its accounts on time. Those accounts, from 2019/20, are still unpublished, along with those from the following two financial years.
These supporters are widely acknowledged to be among the longest suffering in English professional football over the past five years (will accept applications from Scunthorpe and Yeovil). Between 2019 and 2022, Southend United won a total of 22 league matches as they went from League One to the relegation zone of the National League, with fans unable to do anything but watch much of it from their laptops during the COVID shutout. It was no way to watch such a precipitous demise.
This season, the supporters have backed popular manager and legendary former player Kevin Maher with average gates of over 6,000 at Roots Hall in the fifth division. It is only lower than four other clubs, all of whom welcome significantly higher numbers of visiting fans due to their geography. Away from home is where Southend’s supporters have really proved their club’s potential, taking an average of more than 600 away despite being on a geographical limb, and bringing more in numbers to the grounds of all 23 National League clubs, including Hollywood darlings Wrexham, Notts County and Oldham, than made the reciprocal journey to Roots Hall.
On 1 March, Southend paid off £1.4million at the last minute to stave off a winding-up petition from HMRC that was on its third hearing having been originally served in the Autumn. Supporters were told by chief executive Tom Lawrence shortly afterwards that a transfer embargo, in place since September, would be lifted within four weeks as an agreement had been reached with the taxman. The players, who had battled through an intense six-game February unpaid, lost all seven games in March, a run that ultimately cost the club a play-off place. A couple of fresh faces may have provided the impetus needed to grab the two points that the club would, as it turned out, have required.
The inevitable breach of that new agreement cited by Lawrence was what brought Southend United before Judge Mullen on Wednesday lunchtime. Another broken promise (the transfer embargo is still in place, and Southend are unable to offer new contracts or sign any new players while this is the case).
HMRC were not alone — three other creditors joined the petition, including the club’s own shirt sponsor, PG Site Services, who have allegedly loaned the club a substantial sum of money to cover ongoing costs throughout the season. During a late April meeting with supporters, following some disgruntled social media posts by the firm about the actions of the club, Lawrence played down any rift and insisted the club’s relationship with its main sponsor was fine. Evidently.
During the seven-minute court hearing, the club argued that a process to sell the club to new owners was underway, and if this didn’t happen within a requested 56 day adjournment, Ron Martin would find the remaining £250k owed (the club had to its credit paid off a chunk of the original debt) from his group companies, a myriad of different entities which in turn seem to suffer the same hardships in submitting accounts or paying tax. Begging the obvious question as to why he hadn’t done this already.
The situation is not just an irritant to the taxpayer. Martin’s lack of regard for his own employees has been staggering. Non-playing staff at the football club have been frequently paid late, or not at all. At the time of writing, several administrative staff have gone without pay since the end of February. It is scandalous mismanagement and treatment of good, honest people, many of whom support the football club and have held on despite severe hardship to serve the organization that they love. It is hard to imagine the peril ticket office or admin staff are facing in a cost of living crisis without pay for two and a half months. For a community football club, this ripples out. Southend may be a city of nearly 200,000 people, but perhaps to the shock of the chairman, many of them know each other and speak to each other. The club faces an ongoing battle to lure supporters from the bright lights of the big London clubs, and burning bridges on your own doorstep would not seem to be a sustainable community engagement strategy.
An example of the way staff have been treated was regaled to me by a reliable source on the way to court on Wednesday. On being cajoled, reluctantly, into meeting several unpaid staff, the chairman was confronted by an emotional employee who expressed concern about being able to pay their rent on time and losing their home. In response, the chairman apparently reassured them that at least, on the bright side, he hadn’t made them redundant.
A wise man once said that football is the most important of the unimportant things. It may not be life, death, or family, but it knits communities together, brings people together and forges lifelong friendships. A love for your town or city’s football club gives you an identity that anchors you, from generations of family ties to an unlikely conversation in a bar in Tenerife with a fellow fan or even a fan of a rival lower-league club. It is a conversation starter, it facilitates travel (my geographical knowledge of the UK has been forged by travelling up and down it every other week throughout my adult life), it grounds you, it lends perspective and it shapes your personality.
Supporting a football club with a permanent Sword of Damoclese hanging over it is draining. When you have given your life to supporting it with every fiber of your being, the thought of having it taken away from you is so terrifying it keeps you awake at night, distracts you during your working day and reduces you to a monosyllabic grump in front of your wife and kids. None of whom have done anything to deserve having Ron Martin play an indirect part of their lives. It is almost perverse that, having finally got things right on the pitch after four long years of abject despair, Southend fans have been unable to truly enjoy the good football and impressive performances from an honest and likeable team without the worry of losing their club altogether.
Back in the winders court, the judge (who had, inevitably, presided over a previous hearing) noted that this was a new petition but expressed his exasperation that the club was once again before him and didn’t appear to be learning any lessons. With evidence submitted (at the last minute, as per Martin’s Modus Operandi) suggesting a sale of the club was underway, he had little choice but to adjourn for 56 days — although there was a horrendous few seconds when he appeared to mull things over, prompting the realisation he had 116 years of history entirely in his hands. How has it been allowed to get to this so many times?
So, my club limps on. 56 more days, 56 more days of worry. 56 more days of a transfer embargo while other clubs re-sign their star players and get on with building their squads ready for the next season. We’re alive, but until Ron Martin sells Southend United FC, it’s a bare existence. We deserve better. The staff deserve better. The players deserve better and the coaching team deserve better. The winders court is no place to be on a sunny Spring morning, and I hope I never have to go there again.