CART connection charge

[magictime]

It's the quality of the debate that raises this forum above others.

 

A bit of light-hearted humour doesn't change the fact that I have been very careful to construct a close analogy to the situation we're debating, in order to illustrate a point. I've also raised some other questions that are very relevant to the matter at hand - e.g. in your view, should the CRT stop charging businesses other than marinas (e.g. boatyards offering dry dock facilities) for access to their waters, and transfer those costs to all licence fee holders?

 

I love a good (civil) argument, and would be delighted to see someone with an opposing point of view come along and raise the quality of debate by trying to pick holes in my arguments - e.g. by showing that the 'tearoom' analogy doesn't work. Equally, I'd be delighted to see someone bite the bullet and give their reasons for thinking that, in that analogous situation, the house and garden should increase its own admission fees (= the CRT licence fee) rather than charge a neighbouring tearoom (= a marina next to the canal) for access.

[RLWP]

And a well constructed and illustrative analogy it is.

 

Richard

 

Are my scones ready yet?

[MtB]

And a well constructed and illustrative analogy it is.

 

Richard

 

Are my scones ready yet?

 

Agreed. Excellent analogy, but I fear the effort was wasted on some here.

 

 

They do scones too? FANTASTIC! Cheese or fruit?

 

 

MtB

[RLWP]

 

Agreed. Excellent analogy, but I fear the effort was wasted on some here.

 

 

They do scones too? FANTASTIC! Cheese or fruit?

 

 

MtB

 

I can't take you anywhere

 

Richard

[Rich]

 

Agreed. Excellent analogy, but I fear the effort was wasted on some here.

 

Yes, me.

 

Put simply it is a charge that should have been strangled at birth. It has nothing to do with boat access, or EOG moorings (something else I find difficult to understand), or water replacement.

[magictime]

Rich, what I'm trying to get out of you (or someone on your side) is a statement of the basic principle underlying your position.

 

There's nothing unusual about one business charging another for the right to 'piggyback' on it by offering goods or services to its customers. E.g. as Adam points out, the company running a football ground might charge the owner of a burger van for the right to trade there; but nobody thinks that the price of a burger from that van therefore includes a hidden extra charge on football fans and that a better option would be to abolish that charge and raise ticket prices for everyone. Why should fans who don't want to buy from that van pay extra for their tickets just so that it can keep its prices low and/or its profits high?

 

What is it about the CRT/marina case that makes it different, in your view? Why should the CRT not charge these neighbouring businesses for the privilege - and it is a privilege - of having access to its waters, and therefore the opportunity to make money from its customers?

 

Come on: give me some of this 'quality debate' you so regret the lack of!

[Rich]

 

Come on: give me some of this 'quality debate' you so regret the lack of!

 

No. You win. Your analogy is fine and watertight. Canal and River Trust are quite right in charging some boaters more than others and for charging marina proprietors for non-existent boats accessing the canal.

[MtB]

 

No. You win. Your analogy is fine and watertight. Canal and River Trust are quite right in charging some boaters more than others and for charging marina proprietors for non-existent boats accessing the canal.

 

This illustrates the problem I think. You think there is some sort of underlying god-given right for the costs a business has to bear to be 'fair'. Is that right?

 

If so, can you come up with a reason things ought to be 'fair'? I don't think you can, because there isn't one. Which is why things in business are not fair. That's the way life is.

 

MtB

[mayalld]

 

No. You win. Your analogy is fine and watertight. Canal and River Trust are quite right in charging some boaters more than others and for charging marina proprietors for non-existent boats accessing the canal.

 

Do you believe that all boaters should pay the same, no matter what they get?

 

Another analogy for you;

 

My local Tesco has a car park that is too large for the number of customers that use the store. It is never more than half full. Should the council perhaps only charge business rates based on the number of spaces that are used?

[magictime]

 

No. You win. Your analogy is fine and watertight. Canal and River Trust are quite right in charging some boaters more than others and for charging marina proprietors for non-existent boats accessing the canal.

 

Ah, sarcasm. The highest form of debate.

 

(Oops, now I'm doing it!)

 

The idea that the CRT 'charge some boaters more than others' simply by levying a fee on marina owners is precisely as absurd as the idea that a football club 'charges some fans more than others' by levying a fee on the burger van in its car park, or the idea that my imaginary house and gardens 'charges some visitors more than others' by levying a fee on the tea room adjoining its land.

 

Yes, some of the money spent by customers of the smaller businesses ends up in the pocket of the larger businesses on which they 'piggyback', but so what? If you're not happy with the price being charged for the service being offered - bearing in mind that the convenience of the location is reflected in that price - no one is forcing you to give your custom to those businesses. The idea that the smaller businesses should be allowed to piggyback on the larger ones for free in order to keep prices down for their customers, and that the larger businesses should make up the resultant shortfall in income by increasing charges on customers with no interest in burgers, cups of tea or marina moorings, is just... well, can you not see the problem there?

 

If the CRT required every boater to have a mooring in a marina connected to its waters, you'd have a point; this would be a hidden tax on boaters and might as well just go on the licence fee. But that's not the case. It's up to you whether you CC, pay for an inline mooring on CRT waters, moor in a marina on non-CRT waters, or moor in a marina on CRT waters that's subject to the NAA fee. If the owners of the latter marina are charging higher prices in order to cover that fee, rather than just absorbing it themselves, you have to decide whether the package on offer - direct access to CRT waters, plus the security of being in a marina rather than on the canal itself - is worth the price being charged.

 

The point about 'charging marina proprietors for non-existent boats' is similarly absurd, in my view. If I run a shopping centre (say) and someone agrees to pay me £50,000 a year to rent a large restaurant unit, it's no use him coming back to me after six months later in a rage because I'm 'charging him for empty tables'. He's not paying me to make sure his tables are full, he's paying me for a space that he thinks he can make profitable use of.

 

[Edited to include quote.]

Edited January 24, 2014 by magictime

[johnthebridge]

Whilst I'd be the first to say that if you do a deal with someone-anyone-then you should abide by the conditions of that deal, it does seem to me iniquitous that equal conditions aren't applied to all and sundry in these circumstances. But, I suppose that if certain people were/are dumb enough to believe BW's stories that 100% occupancy was a racing certainty and that it could never be otherwise, then more fool them. Perhaps, like recent banking events, some might even feel they've been mis-sold a commodity?

Aren't the analogies with the stately home/tearoom and football ground/burger van somewhat questionable? In those circumstances, there is already something of "value" on site, ie. the stately home or football ground, to which a second party then attempts to add value by installing the tea-room or burger van. In the case of a newly-constructed marina, nothing exists on that site until the marina is actually built. Doesn't the owner/constructor of that marina thereby create the initial "value"?

Before anyone says it, I realise that the water could be construed as "value" but, surely, you already pay a licence to avail yourself of that? Isn't any mooring arrangement made between two parties, whether it be marina, EOG or bankside, merely a mutually agreeable accommodation for one's boat to be left somewhere? In isolation, a mooring permit allows only that. It doesn't allow one access to the "value"-the water.

[Leo No2]

If the connection charge is so unfair why has nobody (or no company) taken BW and/or C&RT to court under the terms and conditions of the Unfrair Trading Act (http://www.oft.gov.uk/about-the-oft/legal-powers/legal/unfair-terms/guidance#.UuJ0-H-QGSM). I suspect they haven't done that because it isn't deemed unfair.

 

I chose to moor in a marina because I prefer the facilities it gives me - I would however prefer, given the opportunity, to moor much closer to home and where I could see the boat from my house but that facility is not currently available to me so my choice is to moor in a marina. The marina pay C&RT for the privilege of having a connection to the canal and that cost is passed on to me - I see no harm in that in business terms - it is all part of the 'package' I receive from the marina. If the marina should pay C&RT 9% and in reality the cost to me is 10% that's the way life is - if they charged me 15% I would probably challenge it.

 

I'd prefer not to pay VAT but I am obliged to and what does the government do to justify the VAT I have to pay - well nothing really and my MP has agreed with me on that when I complained about the vast amount of VAT I paid when having my house renovated.

[magictime]

Aren't the analogies with the stately home/tearoom and football ground/burger van somewhat questionable? In those circumstances, there is already something of "value" on site, ie. the stately home or football ground, to which a second party then attempts to add value by installing the tea-room or burger van. In the case of a newly-constructed marina, nothing exists on that site until the marina is actually built. Doesn't the owner/constructor of that marina thereby create the initial "value"?

Before anyone says it, I realise that the water could be construed as "value" but, surely, you already pay a licence to avail yourself of that?

 

The thing of value that's already on the site is the canal. Yes, you already pay a licence to avail yourself of that - just as the football fans and stately home visitors pay an admission fee to enter the grounds.

 

The tea room and burger van do, I suppose, add value to the stately home and football grounds respectively - they make visiting them a more attractive prospect (to some people) - and I think the same is true of marinas; their existence makes owning a boat a more attractive prospect (to some people). But my point wasn't so much to do with the value of the burger van to the football ground, the tea room to the stately home, and the marina to the CRT. Rather, it was to do with the value of the football ground to the burger van owner, etc. In all three cases, the second party sees an opportunity to make money from someone else's customers, by locating his business where those customers are.

[mayalld]

Whilst I'd be the first to say that if you do a deal with someone-anyone-then you should abide by the conditions of that deal, it does seem to me iniquitous that equal conditions aren't applied to all and sundry in these circumstances.

 

Equal conditions are applied to all and sundry, in respect of any new agreements that have been entered into.

 

There are, however, historic cases where there is a lower (or zero) charge.

 

Let us say that you own a long established marina, that predates the standard 9% of maximum mooring income deal. When you father opened the marina in 1963, the deal that he did with BWB was that he would pay £5 per boat using his marina, with the amount rising with inflation each year.

 

He now pays £76 per boat per year (and nothing on the unoccupied moorings).

 

You could suggest that it isn't equitable that he should have such a good deal, compared to a marina up the road that pays £200 per berth (including unoccupied berths).

 

However, that was the deal that BWB did with him back then, and no matter how "unfair" it might be to competitors, it would be far more unfair if CRT were to come along an unilaterally change the terms.

[churchward]

This thread is quite interesting.

 

I can think of (and could find if I looked) several threads where someone has suggested that Marina moored boats pay/contribute more to CRT funds than a CC paying their licence fro instance.

 

This was met with derision and flaming degenerating into the normal kind of name calling. Yet here on the thread it s those that say it is not an additional charge to boaters that are havng to justify their posts.

 

Life is ironic/contrary nes pas!

[magictime]

can you come up with a reason things ought to be 'fair'?

 

Go on, I'll bite. The reason things ought to be "fair" is that "fairness" is a normative concept; i.e. it's all about the way things "ought" to be. Hence it doesn't really make sense to say something like: "If you want to do what's fair, you'll return the money. But if you want to do as you ought, you'll keep it". "Do what's fair" and "do as you ought" are pretty much interchangeable. They mean "do the right/just/appropriate thing".

[churchward]

To be more serious about the subject. To those that think once the access to the water is paid for there are no ongoing costs then think why this may be.

 

When the canals were commercal and different companies owned the canals and collected fees for passage firstly why not a one off charge rather than tonnage tolls? Secondly why were those companies so aggressive in maintaining their own water rights over other connecting canals?

 

Every new Marina takes more water this has to come from somewhere. It may not overall be that significant but it will be more water taken from whatever source is available be that resevoir or river etc.

[Beaker]

Bump.

 

(For MtB).

[MtB]

Bump.

 

(For MtB).

 

Stop that. It's not fair!

 

Err...

 

MtB

[Beaker]

 

Stop that. It's not fair!

 

Err...

 

MtB

 

[DaveP]

Just as another 'eyes wide open' viewpoint on the startup;

 

The backers are said to be millionaires; they've lent money to a company that they set up to build the marina, which has then leased the site to another company of theirs, which has rented the site to further company to actually run the marina. Not the signs of an unsophisticated mug who just wants to run a marina - in the same way that so many have been fleeced by the pubco's indulging their dream of running a pub.

 

Presumably, they would have evaluated the potential profit between digging a new hole and paying BW the 9%, or buying out an existing marina and not paying the 9%. And decided that the new hole presented a better bet.

[magictime]

The question of 'ongoing costs' is a bit of a red herring, IMHO. Direct access to the canal has a commercial value to the owners of businesses such as marinas, chandlers, and boatyards. The CRT would therefore have to be crazy to let them have that access for nothing, even if that access in itself cost nothing to maintain. Their job is to look after the waterways in the interests of their licence holders and the general public, not to maximise the profitability of businesses who see an opportunity to piggyback on that hard (and expensive) work by providing goods and services to boaters.

 

The more I think about it, the crazier it seems that people are seriously arguing that these charges on businesses should be abolished and replaced with a higher licence fee for individual boaters. Are these people also lobbying for the abolition of business rates and a proportional hike in council tax, on the basis that it's not fair for people who visit Starbucks to pay an indirect 'extra' charge for local services?

[George94]

Rich, what I'm trying to get out of you (or someone on your side) is a statement of the basic principle underlying your position.

 

There's nothing unusual about one business charging another for the right to 'piggyback' on it by offering goods or services to its customers. E.g. as Adam points out, the company running a football ground might charge the owner of a burger van for the right to trade there; but nobody thinks that the price of a burger from that van therefore includes a hidden extra charge on football fans and that a better option would be to abolish that charge and raise ticket prices for everyone. Why should fans who don't want to buy from that van pay extra for their tickets just so that it can keep its prices low and/or its profits high?

 

What is it about the CRT/marina case that makes it different, in your view? Why should the CRT not charge these neighbouring businesses for the privilege - and it is a privilege - of having access to its waters, and therefore the opportunity to make money from its customers?

 

Come on: give me some of this 'quality debate' you so regret the lack of!

 

Quite simple. CART is a monopoly. The marina owner has no choice but to pay. And he gets nothing for it. And, worst of all, it's a fixed charge.

[twbm]

C&RT own an asset that another person wishes to exploit so they can make money. (As has been said marinas are unlikely to be viable if they open in random fields nowhere near a navigable water course, even if they are 9% cheaper). That asset costs money to provide and maintain, so C&RT agree to the third party profiting from their 'product' - without which the marina could not trade - providing they contribute to its maintenance through a connection charge. Filling the marina with boats is down to making it attractive and affordable once all business costs are covered and a required profit calculated. If it doesn't fill with boats that's not a reason for suppliers to be charitable.

 

At the front of our bar is a patio area owned by the local council. I wish to use it for profit making purposes. They are happy to let me but charge me a fee that reflects the fact that I make a profit from the use of their asset. I pass that and all other business charges on to customers.

 

Sky TV is less than £100 a month at home (I believe). Sky TV for the bar would be £900 a month because it will attract football fans who will buy lots of beer. The bar can function without football fans. I do not subscribe to Sky TV. I'm not sure that lasy bit's completely relevant but you get the idea.

 

Talking of bars - it's beer o'clock, and I know one where I don't have to pay anything. Should probably avoid becoming a continuous boozer.

[matty40s]

Quite simple. CART is a monopoly. The marina owner has no choice but to pay. And he gets nothing for it. And, worst of all, it's a fixed charge.

Where do you get this ""nothing for it"" from

It allows them to run day boats up and down CRT waters all summer.

It allows them to get passing trade selling diesel/ pump outs, short term moorings.

It allows them to get passing trade in fixing and blacking boats, not to mention launching them to the network.

It allows them to sell boats, not only directly, but also as an agent for abnb, once you buy it you can sail it away onto the network.