The unravelling of Rangers

[ian1964 10,409]

By Andrew Smith, Tom English and Moira Gordon

Ibrox annus horribilis goes from bad to worse but somehow championship title is still a live prospect

SANCTIONS from UEFA over sectarian singing, a takeover that remains in the balance, bankers putting on the squeeze and scares over a tax case that could spiral Rangers into insolvency. Manager Walter Smith would be forgiven for dreading what next might assail his beloved club. "I hope there's not anything that comes next. There can't be a 'next'," says Smith.

 

Remarkably, what could come next is Rangers snaring their third consecutive title. For, in the midst of all their batterings and buffetings, the Scottish Premier League fixture list for the post-split games means the Ibrox men must be considered slight favourites for the championship. Celtic have five away games in their final seven, one of these at Ibrox.

 

Rangers have any number of ready-made excuses for forgivable failure. Smith has never allowed his players to seize on these. The state of the Ibrox squad might not be so parlous as is popularly promoted, considering �£4m from sales was reinvested in Nikica Jelavic only last summer. However, the fact that Rangers have continued to squeeze out victories to give them a real chance of sending Smith into his retirement next month with a 21st trophy and tenth title, in the face of deluge of negative headlines, is testament to their manager's strength of character.

 

"If we look at recent events, the different things going on around the club, I can't say it doesn't have an effect on us," Smith states. "But we've had a circumstance for three years now where we've had to sit down with every player and tell them they're up for sale. They've been seeing the squad get gradually reduced. Maybe, they've actually become a bit immune to the things that have happened on the outside. Whatever anyone says about our team, we've handled the circumstances of our club really well from the footballing side. The players haven't allowed it to affect them too greatly. But it's now reaching a tipping point - every day now you feel as if there's something different that takes the focus away from the football.

 

"We've avoided it so far. The UEFA charge last week was bad enough, this week it's worse. I've said to the boys it's a big test and challenge for everyone here, from myself all the way down, to keep our concentration levels purely on the football side of things."

 

The absence of a takeover and the loss of the tax case would preclude Ally McCoist being able construct a competitive side. That would be a real tipping point of everything that's gone on. And everything that has gone on has, Smith admits, spoiled his final season at the club. "I would have liked the season to have gone smoothly. I don't mean we would have to win, just be competitive and able to concentrate on the football side. We had a fair idea it wouldn't be the case towards the end of last season; that there would be other things with the club up for sale. Now you can add this latest UEFA charge and it's a shame." ANDREW SMITH

 

Tribunal resumes tomorrow on the '10,000lb gorilla in the room'

 

When it comes to the Rangers tax case one certainty can be stated. The First Tier tribunal resumes tomorrow at a tax chamber in Edinburgh and is scheduled to sit for the next fortnight in private, with a decision expected within a month to six weeks. Under the microscope will be the Murray Group's Employment Benefit Trust which operated between 2001 and 2010 for some salaried employees of the Ibrox club. And depending on which tax experts you believe, the tribunal ruling could either sound the death knell for Rangers as we know the club, or clear the way for a takeover.

 

As we also know, when discussing the club's half-year results a fortnight ago, Rangers chairman Alistair Johnston described the tax bill from HMRC - which is said to have lodged a demand for an unpaid sum of �£24m - as a "10,000lb gorilla in the room" and that "you don't know how hungry it is". The tone of such comments suggests the club will in some way require to satiate HMRC's appetite for what it sees as tax evasion.Yet, the other side of this is the fact that Rangers have appointed QC Andrew Thornhill to argue their case. He is one of three Queen's Counsel on their bench convinced they can successfully argue that the EBTs the club operated were then run in similar fashion at a number of companies. Thornhill is considered the country's leading legal figure on such matters. The Chambers guide describes Thornhill as "a superb heavy hitter against the Revenue". What can be gleaned of the case suggests he had better be. Rangers elected to make payments to players and other employees through what are called loans to EBT totalling �£33m in all. No PAYE and NI contributions are made on these, with the idea being the loans will be repaid. In practice, they never were and became benefits in kind, a loophole since closed by HMRC.

 

At the initial hearing last October, evidence from a number of players was heard, though there was not sufficient time to get through all those called. It emerged the club had indemnified all players from paying tax on their loans, which may or may not be used against Rangers by an HMRC determined to squeeze the use of EBTs as it mounts what it sees as a major crackdown on all forms of tax avoidance. Were Rangers to lose they would be liable for interest on the underpaid tax, calculated at around �£10m. Then there could be a fine, around 75 per cent of the original sum, that would add a further �£18m to a bill that, weighing in at around �£52m, Johnston has admitted the club could not pay. Neither could David Murray, with Lloyds in no mood to extends his credit facilities that have been again stretched with Murray International Holdings' debts standing at �£713m, despite a 25 per cent debt-for-equity swap with the company's bankers.

 

The bottom line is that if the HMRC is successful in the case against Rangers there appears no way that administration can be avoided. The situation is that stark. ANDREW SMITH

 

It is stated that the hold-ups in the takeover saga are down to legal bureaucracy rather than anything more sinister, but the longer it goes on the more uncertain the Rangers fans will become. Whyte has proven to all parties that he has the funds to buy the club and believes that there is a will to get the deal completed.

 

There is an acceptance in all camps that the coming week is pivotal. TOM ENGLISH

 

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[Super_Ally 0]

Ibrox annus horribilis goes from bad to worse but somehow championship title is still a live prospect

 

What? Chance of a title. League Cup. And a decent European run. Terrible year right enough. Didn't read the rest of this pish.