HCT Group enters administration

News stories are free to read. Click here for full access to all the features, articles and archive from only £8.99.

Following a number of months during which its operating companies were sold or closed down, the 40-year old social enterprise group has now itself closed

HCT Group ceased trading on Friday 23 September, with Mark Thornton, Martha Thompson and Neville Side of BDO LLP appointed as Joint Administrators of the company. Whilst HCT Group itself provided no further information, Frank Villeneuve-Smith, HCT’s former Communications Director, explained via his personal LinkedIn account following the closure: “It is with deep regret and immense sadness that we announce that, after four decades serving our communities, HCT Group is to close. The move follows a period where we have been rocked by multiple challenges – a period of difficult trading prior to the pandemic, the financial impact of the pandemic itself, followed immediately by the current surge in fuel prices and the cost of living crisis. This has led to unsustainable commercial losses and we see our situation as irrecoverable.

“Our priority has been to reduce the impact of the closure on our staff, suppliers, creditors and communities through the sale of trading arms and, where that has not been possible, working with commissioners to identify new providers for services. Our London red bus operations were sold to Stagecoach in August, transferring our London red bus team to the new operator. Our businesses in Jersey and Guernsey were sold to Tower Transit, part of the Kelsian Group, in mid-September, transferring all staff and services. In Bristol, we have transferred our Metrobus m1 route to First Bus, with relevant staff transferring with the route – and job offers made to staff on other services. Work continues by commissioners to re-instate other services disrupted by the closure.

“Working with our commissioners in London, new operators have taken over our special educational needs, dial-a-ride and adult social care transport services, transferring all staff. A buyer could not be found for our CT Plus Yorkshire and Powell’s Bus subsidiaries in West and South Yorkshire, where we operated mainstream bus services along with school transport services. These subsidiaries closed in early August. Many routes transferred to other operators, protecting services and a significant number of jobs.

“Our community transport operations have been similarly affected, with the closure of our community transport unit in Bristol and the cessation of route 812 in Islington and other London services at the end of August. As a result of these disposals and hand-overs, the overwhelming majority of livelihoods at HCT Group have been preserved, albeit with different employers. It also means that most of the passengers and commissioners that relied on our services will not experience disruption. However, we are saddened by the impact this has had on our colleagues and communities where alternative provision could not be arranged – particularly in our community transport services.

“Closure is the last possible outcome we wanted and a very sad day for everyone at HCT Group. Everyone here has worked tirelessly to put the organisation on a sustainable footing and we have done everything in our power to prevent this situation, but our position cannot be sustained any further. We have run out of road.”

Founded in 1982, HCT Group started out as Hackney Community Transport, providing transport for disadvantaged individuals and local community groups. It grew first across London and then across the British Isles as a social enterprise, using its community services to tackle social isolation and long-term unemployment. Frank continued: “Over that time, HCT Group placed its social mission at the heart of its work and touched the lives of tens of thousands of people. It has provided many millions of passenger trips for older and disabled people on its specialist transport services, tackling social isolation and loneliness. It has provided millions more passenger trips for local community group, helping to bring our communities together. Thousands of long-term unemployed people gained rewarding jobs through programmes at our Learning Centre.

“First and foremost, HCT Group was a social enterprise. HCT Group came to an end because of the unique circumstances we’re living through, not as a consequence of some fault in the promise of social enterprise to tackle our most pressing social issues. Even as we close, the ideas that started us on our course all those years ago still abide: that compassion is the first of all values, that if we want to make a better world, we must come together to do so; and that service to others is greater than service to oneself.

“We cannot pretend that the mission that drove us is complete. We still live in a world where barriers to access for vulnerable people are an everyday reality. Transport is the means by which the most marginalised in our society can access jobs, education, healthcare – or even the simple freedom of getting out and about – and taking down barriers to access is an urgent priority. We know that social enterprises and community transport operators across the UK are working to missions like ours, giving us hope for the future.”

According to its latest accounts, which included what it said was a significant level of one-off and non-recurring losses, HCT Group saw a deficit of £10.3m for the extended financial year from 1 April 2019 to 28 September 2020 on a total income of £123.7m. The charity breached covenants in its loan facilities, but was extended a waiver by lenders. Some of the losses related to operations in Jersey, which accrued a £1.6m loss as a result of the drop in passenger numbers during the pandemic, and £2.2m at its former Manchester Community Transport operation.