How did Scunthorpe United go bankrupt? Two ways. Gradually, then suddenly.
It's reaching critical mass at Glanford Park, with funding pulled and the club perhaps even homeless.
Back in the days when I was paid substantially more than minimum wage to write about football, I wrote about Scunthorpe United and once opened with this. It’s probably little gauche to quote that old goat Hemingway, these days, but it was difficult not to call this to mind when thinking of the predicament in which they’d come to find themselves:
"How did you go bankrupt?"
"Two ways. Gradually, then suddenly."
When you’ve been covering football clubs in bad positions for a long time (and my hair was definitely not this colour when I started doing this), you get a feel for what’s just a passing problem and what is an indication of something far deeper and insidious. Scunthorpe United had issues building; ground ownership separated from the club, even though nothing bar a slow build-up of rust seemed different about the place on match-days, overspending to a point which became chronic and uncontrollable, a team that couldn’t buy a win, and an increasingly desperate fan-base, at least among those who haven’t melted away as the downward drift has persisted.
These stories have both familiar tropes and familiar plot-lines. Owner gambles on promotion and misses out, funded by loans which are secured against the ground. The ground is subsequently transferred into the name of the owner or one of his business interests. With the money having run out, the team goes into a tail-spin—Scunthorpe’s league record over the last five years has been 23rd, 20th, 22nd, 24th, 23rd—and the owner puts the club up for sale. He doesn’t care about the club, by this stage. This is about land, now.
This is the first and most important point at which due diligence has to come into play, because who would want to buy into this particular football? The hope is for a fan with more money than sense and an attitude towards spending that makes his accountant wince, but that’s… unlikely, and even among those treating the club as an ‘investment’ and no more, there is hardly a shortage of lower league football clubs who would welcome a large amount of inward investment and who don't have the myriad issues that Scunthorpe have had for years. With the stadium gone they’re effectively assetless, effectively valueless, and both functionally and legally insolvent.
And this is when the tyre-kickers start knocking at the door. Your Bassinis. Your Vaughans. The people whose ears prick up when they hear that a football club may be up for sale for a quid because, well, what’s the worst that can happen? They never stop to think that there might come a point at which they’re being screamed about on local radio phone-ins on account of their cack-handed running down of a much-beloved local institution, or if there is, they don’t care.
The ground may or may not get sold. The club may or may not become a tenant in their own home, pushed into that situation by an individual pushing financial responsibility for these bad decisions from themselves onto the club itself. It’s what limited liability is all about, baby. This, of course, is the second-best case scenario in such a situation, after moving straight into a new stadium, but of course this never happens to these clubs. Just look at Coventry City under Sisu. They screamed and screamed until they were very sick indeed about a new stadium, but it never materialised. Or Southend United, 25 years without a new home at Fossetts Farm. The anniversary party was probably missed in the scramble to keep the club alive.
Sometimes the clubs concerned up getting evicted, or ‘leaving’ with some pie in the sky ‘plans’ to build a new stadium better than the old one, with blackjack and hookers, which just happens to only exist in the mind of the man making the proclamation and, if you’re lucky, a couple of artist’s impressions of a glistening new monument to mammon made of glass and steel that will never, ever be built.
It should be clear that the collapse of a football club does not have to be the fault of one person and one person alone. Peter Swann has many questions to answer about his running into the ground of this club, about the possibility that he allowed his own gambling addiction to affect his stewardship of Scunthorpe United. It is neither reasonable nor acceptable behaviour to weigh a football club down with debt and then take its home to cover those loans, and especially when they mounted on your watch.
But this doesn’t excuse David Hilton. Football clubs in the condition in which Scunthorpe United found themselves by the end of last year need care and attention, not shock and awe. And yes, it can be an expensive business. That’s why they cost a quid in the first place, and also why they still struggle to find buyers. So don’t be expecting thanks.
***
It’s easy to forget how far Scunthorpe United have fallen, and how quickly. Fourteen years ago, they were in the Championship. On the 12th September 2009, they beat Crystal Palace 4-0 at Selhurst Park. In the space of four days between the 17th and 20th October 2009, they beat Sheffield United 3-1 and Newcastle United 2-1. This weekend they are due to be playing Buxton in the National League North, if that match can even take place. It really has been quite a fall.
And this week has seen fall after fall after fall. It’s only been eight days since Hilton put the club up for sale, but on Monday he started banning supporters who had been critical of him, including several extremely long-serving fans. Because nothing makes a club look like a more attractive proposition to a business buyer than finding that its most loyal customers are in the process of being banned for life.
Later on the same day, the club’s social media channels flickered out of life, like lightbulbs in the minutes before a power cut, and this was followed by three bombshells in quick succession on the 28th. Firstly, in another rambling club statement, Hilton confirmed that he would no longer be funding the club in any way whatsoever. (Okay, fine, seems like now would be a good time to use that 1899 club money to fund it eh, David?)
Secondly, in the same statement, came the news that Scunthorpe would be leaving Glanford Park and tacking up residence at nearby Gainsborough Trinity after their home match against Brackley Town on the 7th October, while another two board members had resigned. And then thirdly, a couple of hours later:
Gainsborough Trinity FC are aware of a statement issued today by Scunthorpe United. This statement was issued without the knowledge or consent of Gainsborough Trinity. Whilst both clubs do have a preliminary agreement in place for a groundshare, should the need arise from Scunthorpe United, there are still other obstacles to overcome before a Scunthorpe fixture can be played at the KAL Group Stadium.
The local SAG (Safety Advisory Group), Police and local authority would need to issue the appropriate safety certificates, which are not currently in place.
Well, that’s awkward. When even the second-worst case scenario is looking logistically unlikely, you know you’ve got problems.
***
Questions, questions, questions. So many questions:
What’s happened to the 1899 scheme (later name-changed to the 100 Club) money? Where is it? Because at £1,899 a pop, as few as, say, 93 of them would be worth more than £175,000.
If David Hilton still owns Ilkeston Town, why aren’t Scunthorpe going there? And why does this barely seem to have been considered, even though Hilton himself had to be talked out of moving all non-matchday activities to Ilkeston following relegation from the National League?
How do the players and staff get paid at the end of the month?
What’s Peter Swann’s version of the club leaving Glanford Park? (Because Hilton’s attempt is incomprehensible.)
Where’s the season ticket money from the summer? It’s only the end of September. And why could season tickets only be bought with cash or by direct bank transfer during the close season?
Why does David Hilton keep releasing public statements which are stuffed with lies and not only lies, but lies which are obviously disprovable? What on earth did he think he was going to achieve by saying “We’re off to Gainsborough” when he surely must have known that no formal agreement had concluded and that no licence for that level of the game was held?
Nobody ever wants to say this, not even those among us who’ve been there before. But this looks like the end, the ‘rapidly unravelling’ spell. Would it have made a difference, had more Scunthorpe United supporters asked difficult questions rather than forming a protective shield around this charlatan? Maybe not, but it probably wouldn’t have done any harm. But then, no matter how wrong-headed those who’ve nailed their flags to the Hilton mast might have been, this isn’t their fault either, is it?
They haven’t helped. The dismissal of those who raised alarms about him when he first arrived at the club was damaging. But it wasn’t them overspending, taking money by cash only, and reneging on an agreement to buy the stadium (because, well, let’s face it, he never had the money, did he?) either. All Scunthorpe supporters are ultimately victims of a culture which has failed them, in which everybody is in thrall to money, those who have a lot of it, and even those who just claim or imply that they have a lot of it.
Some know what these people are while others, albeit a diminishing number, continue to cheer for the man who is taking such an active role in killing their club before their very eyes. And at this late stage in proceedings, even a mass awakening to this obvious reality might come too late to make any appreciable difference. The windows to save Scunthorpe United are slamming shut and as ever in these situations, that gradually is now starting to become… suddenly. Very suddenly indeed.