Visit London pensions: ‘Mayor failed to secure promotional funding’

Boris Johnson secured no Government funding for promoting the capital despite promising to mount a “Stalingrad-like” defence of his budgets according to evidence heard by the London Assembly this morning.

The Assembly’s Economy, Culture and Sport committee was hearing from witnesses as part of its investigation into the placing of Visit London into administration, a move which has caused concern about the future of pensions of the tourism agency’s former staff.

Pensioner representative Ylva French told AMs the scheme’s members were “not asking for any favours, we’re not asking for sympathy, we’re just asking for what we are already entitled to.”

Assembly Members were told by witnesses that London & Partners, a new company set up by City Hall to replace Visit London, has a budget of £14m per year for four years.

Representatives told AMs the lack of long term funding made it difficult for them to take on a previous 20 year commitment by Visit London to pay towards the pension scheme’s deficit.

The Mayor’s regeneration and enterprise advisor Sir Peter Rogers said it had been unclear how much money was needed to safeguard the pensions and that while providing a low sum “was an option”, the reported £7-9m liability “would have decimated the promotions budget.”

Trustees from the pension fund insisted the amount of money needed was around £500,000 and that the higher sum represented a “walk out” figure, not the cost of taking on the liability as a going concern.

The committee also heard from two London businesses which are owed money by Visit London and currently expect to get paid as little as 35-45% of the outstanding debt.

Dan Wardle told AMs that a database his business created for Visit London was being used by London & Partners even though he hadn’t been paid and the £8,000 invoice had been overdue at the time Visit London collapsed.

AMs also heard from recruitment consultant Tim Smith who is owed £14,000 despite staff he’d originally found for Visit London being transferred to London & Partners.

Both businesses complained that London & Partners is “operating from Visit London’s offices, using Visit London’s staff and resources and doing Visit London’s job” while leaving them unpaid.

Wardle said while the transfer of assets and staff to London & Partners may not be illegal, it was “immoral”.

AUDIO: Pensioner and creditor representatives address AMs

AMs expressed concern that in buying Visit London’s assets from the administrators, London & Partners had forced the taxpayer to pay again for resourses they had already funded.

Evidence that no Government money was received for the promotion of London appears to contradict a City Hall press release announcing a new combined promotions agency dated 21st December which said:

“Its creation is the fruit of detailed negotiations with central Government, which are nearing their conclusion, and shows that another key element of my vision for London has been secured.”

A meeting is now scheduled between Sir Peter and pension trustees. Rogers said the Mayor “did feel” a moral duty to staff and creditors but insisted no guarantees about a remedy could be given.

Note: In the original version of this article we reported witnesses had told AMs that London & Partners had been given funding of £14m over four years. In fact the funding settlement from the GLA is for £14m every year for four years.