Tuesday the 2nd of June saw Luton Rising (LR) hold a community Engagement Event at Venue 360 in Luton. The event was to tell the real shareholders of Luton airport, the residents of Luton, what has happened, and will be happening with the Development Consent Order (DCO) process, this year and going forward.
A short talk was given by the Chief Executive of Luton Borough Council (LBC), followed by the Chief Executive of LR, accompanied by a slide show. After this was a Question-and-Answer Session; and the meeting ran for 90 minutes.
Nothing new was mentioned. The highlight of the meeting was that the monitoring period for the Green Controlled Growth (GCG) base line base levels started in January, would last a calendar year. The reporting from this would be published in July 2027, which would then trigger the Article 44 request by LR to the Department of Transport.
This would then commence the official start of the DCO and expansion. As Phase 1 works would commence in 2028, taking passenger capacity up to 21.5 million per annum.
When questions were taken, they were answered with mainly long-drawn-out responses. They seemed to answer the points raised, but took so long, you weren’t quite sure they did answer the question.
Questions were answered with ” well the Government wants this”, “we are only doing this because passengers demand it”, or statements that emphasised supposed benefits, whilst papering over some chasm-sized cracks, undermining those benefits.
Two replies particularly pricked our ears.
The LR CEO stated that aircraft emissions were being recorded, as part of the GCG process., yet there was no mention that they were during the slideshow presentation. LR seem to have forgotten the ruling by the Advertising Standards Authority, about their advertising during the lead up to the DCO Inquiry:
www.bbc.co.uk/news/articles/c9r39p7ex4qo
“LR indicated that information related to air traffic emissions had been omitted”
There is an awful lot of paperwork involved with the DCO, so we will put this slip up down to not being able to remember them all.
In reply to a question about the Community First programme, and how charities are now receiving less than half the donations they were when the airport had half the passenger numbers it has now, and that no dividend had been paid to LBC since 2020, the LR CEO stated that there were legal reasons why they had not been paying dividends, and that “I’m not going to Court for paying a dividend”.
This piqued us, so we asked our friendly Google AI the following question: – “Under what circumstances, could a UK company be breaking the law by paying a Dividend to its shareholders”
AI provided the following reply: – A UK company could be breaking the Law by paying a Dividend to its shareholders, if it does not have sufficient profits available for Distribution. The Companies Act 2006 states, that a Company may only make a Distribution, such as a Dividend, if it has profits available for that purpose.
This means that Dividends must be paid only out of accumulated, realised profits less accumulated, realised losses, as shown in appropriate Company Accounts.
So, if a company pays a Dividend without sufficient profits, it is considered an Unlawful Distribution.
Directors of a company making an Unlawful Dividend payment may be in breach of their own fiduciary duties, and can be personally liable to repay the amount of the Unlawful Dividend themselves
The Unlawful Dividend will always remain Unlawful and cannot be rectified to make it Lawful.
The Company’s Accounts may contain errors and will need fixing, which may mean that other transactions carried out because of their contents are tainted too.
A Company can itself be impacted by appearing Balance Sheet insolvent in respect of the Unlawful Dividend being included in its accounts, which could mean a Company may have difficulties in complying with its financial obligations.
As we have stated in our previous articles on LR finances and accounts, we are not financial experts, and just publish what we find, and let those who are in the financial sector make their own deductions.
BUT we read this as, after tax, LR does not have the retained earnings, after tax, to pay a Dividend.
From 2019/20 to 2024/25, LR has received £267.8 million from the Concession Fee.
So if Luton Rising can’t pay its Dividend dues on that sort of income, just how long will it be, and how many passengers will have to use the airport, before it can?