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Lights Out on Dunfermline Athletic?

As Dunfermline's financial situation goes from bad to worse, supporters are treading cautiously before parting with their cash.

Dunfermline fans are in no rush to subscribe to share issue. Picture: SNS
Dunfermline fans are in no rush to subscribe to share issue. Picture: SNS

The  lights could soon be turned out on Dunfermline Athletic. Literally.

The debts are piling up at East End Park, with the latest being an overdue electricity bill. ScottishPower, who have switched the club to a more expensive tariff until the £12,800 invoice is settled, now join the  list of creditors.

Her Majesty’s Revenue and Customs are waiting to receive the remainder of an £81,000 tax bill, while the playing staff have not been paid in full for a second month in a row.

With cashflow  a serious problem, the club are desperate for home games to go ahead over the festive period to help ease the burden but, as winter bites, there is every chance of postponements, especially if switching on the undersoil heating or floodlights is only going to add to the financial woes.

The board have blamed the fixture list as well as relegation for their current predicament but there are historical factors at play, too.

Dunfermline’s ownership structure is a particularly complex one but, at the heart of it all, is Gavin Masterton, the former treasurer and managing director of the Bank of Scotland, whose Charlestown Holdings vehicle owns 95% of the club.

In the most recent available accounts, Charlestown Holdings had a net debt of around £35m, while the club, in turn, owed £5.8m to East End Park Ltd, owned by Masterton, and a further £2.4m to Charlestown Holdings. And that is just the most pertinent tip of the ownership iceberg.

Now it has been left to the supporters to try to salvage an increasingly bleak situation.  It is always so. Clubs in trouble tend to turn to their fans to bail them out after years of largely ignoring them, and that bitter-sweet irony has not been lost on the Dunfermline support.

While there is no room for sentiment in business, it is different for those with an emotional connection to say no. Fans could never blithely stand back and watch their club suffer or even go under, something owners and chairmen have never been slow to exploit over the years.

Dunfermline fans have united under the Pars Alive banner and undertaken various fundraising initiatives. They have reached a point now, however, where they must decide whether to progress with their heads or with their hearts. It places them in a near impossible situation.

The instinct of those who choose to act with their hearts is to do everything the club ask of them, to hand over money without questioning where it is going or what they will see in return. Despite being advised to hold off until the situation becomes clearer, a group of fans took the decision at a meeting  on Tuesday night to hand over what is believed to be in the region of £7000 to the club to help pay part of the electricity bill.

There are some Dunfermline fans, though, who feel it more prudent now to take a step back and look at the bigger picture.

In Masterton, they see an owner who has rarely involved them in his running of the club, and who has been less than forthcoming regarding the full scale of the current financial predicament and are, quite rightly, seeking honest answers to a few pertinent questions.  If supporters are being asked to help, they argue, then the least they should expect is greater transparency and a willingness to engage openly with the fans.

Now, after years of being  stuck on the sidelines, the fans are back in the game. The club this week announced it would be offering them the opportunity to buy shares, in the hope that between £300,000 and £500,000 can be quickly raised.

According to the club,  if the issue was successful, Charlestown Holding’s stake would be watered down from 95% to 75% and fans would be given greater representation at board level as the first step to becoming a club wholly run by the community.

The supporters, though, are not planning a rush to subscribe. Despite chairman John Yorkston yesterday insisting the situation is improving and that the players would have all outstanding monies settled by the end of the month, there is a growing feeling among fans’ groups that it might be more prudent to hold off and wait for further details before committing in greater numbers.

If the club are as desperate  as has been suggested, then the supporters would seem to have a strong hand in any negotiations.

There is another reason to squirrel money away in a separate pot. Were the club to go into liquidation, then it would likely be the fans who would be behind any newco that emerged from the ashes.

The Rangers situation has shown that starting again is not as unpalatable a prospect as had previously been the case, making those who would likely be involved question the logic in throwing money just now into a seemingly bottomless pit.
It is just one of myriad difficult decisions supporters face in the coming weeks and months.

Does the head rule the heart?
 

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