LETTER: How Red Star deal hurts the taxpayer
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.From Mr M. E. Taylor
Sir: Your editorial on Red Star (23 August) shows how misleading it can be to declare part of a business unprofitable when the results of cost- centre accounting are followed too blindly. If spare capacity was available on BR trains and if staff were under-utilised, then it may well have been financially advantageous to BR to use these for Red Star.
Internal charges for the use of "spare" capacity are a gross distortion of reality for which accountants should be ashamed. The sole economic justification for any particular activity within an organisation is whether the organisation is better off if that activity takes place than if it does not.
Every day I used to give my wife a lift to work on my way to the station. Thanks to modern cost-accounting techniques I have now realised that this should have been properly costed at the pounds 10 per day that a private taxi would charge. Clearly the arrangement was uneconomic and she now travels by bus for only pounds 3.50 per day. We are most grateful that we have been able to save the "hidden subsidy" of pounds 6.50 per day.
I sincerely hope that the Red Star Parcel workers show the same gratitude to the accountants who have revealed them to be an economic liability.
Yours faithfully,
M. E. Taylor
Woodford Green, Essex
23 August
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments