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Auction to help heritage rail get back on track, says liquidator

By Ian Bushnell - 19 July 2017 6

Beyer-Garratt 6029 locomotive

The Beyer-Garratt 6029 locomotive, City of Canberra, in action. It is not up for sale.

The auction next month of some of the Canberra Railway Museum’s assets, including 100-year-old carriages, is a key step in getting the beleaguered organisation back on track, according to the liquidator.

The museum closed last November with debts of $700,000 after the collapse of its ill-fated freight operation which had been designed to support its heritage trains program.

Deloitte’s Eddie Senatore said the Australian Railway Historical Society’s ACT division owed the Australian Taxation Office about $160,000 and employees about $60,000.

He said the auction was part of overall plans to restructure the organisation so that it can be financially viable and return to its core reason for being  – running heritage trains, maintaining a museum, and providing a place for volunteers to be  involved.

Mr Senatore said he was working with a range of parties – including the ACT Government, some private equity groups, the NSW Rail Museum and interested individuals – to find a way back for the museum.

He said none of the key pieces of the fleet would be up for sale when the auction takes place on site at Kingston on August 2.

He said some of the fleet, including the prized Beyer-Garratt 6029 locomotive, had been moved to the NSW Rail Museum at Thirlmere for safekeeping.

He denied the auction was a fire sale and refuted claims by some members of the Society, who have called for a public campaign to save the entire museum, that the carriages going under the hammer were of great historical significance to the ACT.

He said some of the carriages did carry troops but not necessarily from Canberra, while the Southern Aurora and steel carriages had no connection with the ACT.

He said the carriages that brought the early parliamentarians to Canberra were not being sold.

“What is being sold is not necessarily a ‘must have’ to bring the organisation back to running locomotives with an historical connection to the ACT,” he said.

“We’ve got all the small steam locos that aren’t up for sale at Kingston, so there are some really dilapidated carriages up for sale and it’s arguable that some of those have a historical connection to the ACT, but to the extent that you have $600,000 to $700,000 worth of creditors, the bottom line is you have to deal with them.

“We have to come up with a financial model that allows them to be operated in a financially robust way so that this situation doesn’t happen again.”

Mr Senatore said poor governance and a lack of financial oversight had led to the organisation growing beyond its means and running into major compliance issues, particularly with the scrap metal train to Botany Bay.

The cancelling of that contract was in dispute and the outcome may bring some return to the organisation.

He said it appeared that the heritage train ticket and charter prices had not reflected the expensive running costs of those trains.

He hopes that any resurrected organisation adopts a financial model that has been specially created to adequately price journeys.

“All you need to do in the model we’ve created is put ‘from, to’ and which locomotive and it should punch out the cost, and from there you can work out the price, and I can tell you its going to be more than $3 a person,” he said.

Mr Senatore said he hoped the auction raised interest from the train industry and lovers of trains.

“Private equity groups and individuals have approached us about how they can get involved with the Society, so we’re hoping that’ll happen. You can always stop an auction up until the day of the auction,” he said.

But Society member John Davenport believes the auction would be the thin edge of the wedge.

“These exhibits are doomed, so what is not being sold in this first auction is of great importance,” he said.

“If the liquidator decides to sell more of the collection, locomotive 6029, aka The City of Canberra, could be sold to a scrap metal merchant.”

A spokesman for Environment and Heritage Minister Mick Gentlemen said the ACT Government would not be intervening.

“The liquidator has a formal role to fulfil in managing the affairs of the organisation, and we need to allow that process to proceed. Many of the debts are commercially related and it is not the role of government to assume responsibility for commercial debts,” he said.

“We understand the liquidator is focused on retaining enough of a collection to enable a new organisation to be established and to continue sharing the history of rail in this region.

“The ACT Government will not be purchasing any rolling stock from the liquidation sale, but understands the historical significance these objects have to the Canberra region. As such, we have been working with the museum member representatives and the liquidator to identify the best way to support such a new organisation.”

The auction will take place at 10 am and the catalogue can be viewed here.

Should the Government step in to stop the auction and come up with a rescue package?

What’s Your opinion?


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6 Responses to
Auction to help heritage rail get back on track, says liquidator
Pandy 6:39 pm 04 Sep 17
switch 9:59 am 31 Aug 17

“The Beyer-Garratt 6029 locomotive, City of Canberra, in action. It is not up for sale.”

Yes it is!

Pandy 5:34 pm 22 Jul 17

Man, the days of Kerry, Cheesman, Potters running the show are well and truely past. all those hopes and dreams of ruining the Michelago Tourist Railway. What happened to their shed tat Micky?

I have a fond memory of 6029 though I have never seen her in steam. I hope she finds a great home.

I guess as the old timers get older, it becomes a lot harder to run these old trains in the days of Tinder.

dungfungus 10:27 am 20 Jul 17

dungfungus said :

In the medium term it was the plan to re-locate the society’s operations from Kingston to the vacated former site of an oil depot at Fyshwick which has some pollution issues.

The society currently occupies land that developers would love to “regenerate” and if the administrator/liquidator can’t realise enough from the items already listed for sale this would usually mean that further assets would have to be disposed of. The main asset would be of course the lease they have on the area they operate from which they may even be obliged to surrender.

I note that the administrator says he is working with a number of parties including the ACT government however no comment has been forthcoming from the Minister about what may happen if total liquidation occurs

The government has poured millions into the glass works in Kingston as a way of preserving the heritage value of the old power house and some would argue that they should do the same for the railway enthusiasts given the equal, if not bigger, heritage connection the railways have with Canberrans.

I won’t be holding my breath.

Admittedly, I am a slow learner as now I realise that unless there is a link to some of the claims I make, nobody takes any notice so here’s the link. Note the important role the the railway played in the power station’s history.

http://www.canberraglassworks.com/about/our-building/heritage/

The railway historic society really need some expert PR work on their cause. Lot’s of “pop-up” potential in Kingstown Town. There is a huge global market in old steam trains too. Ask some of the society’s members how often they have travelled to the UK and Europe to enjoy the old tourist railways there.

dungfungus 11:05 am 19 Jul 17

In the medium term it was the plan to re-locate the society’s operations from Kingston to the vacated former site of an oil depot at Fyshwick which has some pollution issues.

The society currently occupies land that developers would love to “regenerate” and if the administrator/liquidator can’t realise enough from the items already listed for sale this would usually mean that further assets would have to be disposed of. The main asset would be of course the lease they have on the area they operate from which they may even be obliged to surrender.

I note that the administrator says he is working with a number of parties including the ACT government however no comment has been forthcoming from the Minister about what may happen if total liquidation occurs

The government has poured millions into the glass works in Kingston as a way of preserving the heritage value of the old power house and some would argue that they should do the same for the railway enthusiasts given the equal, if not bigger, heritage connection the railways have with Canberrans.

I won’t be holding my breath.

switch 9:46 am 19 Jul 17

“We’ve got all the small steam locos that aren’t up for sale at Kingston…”

Is this a misquote? Because there are two steam locos for sale in that auction catalogue, ie 3013 and 3102. And why would you be selling hard to source garratt spare parts, probably for scrap metal prices, if you intend running 6029 here again in future?

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