Aristocrat and self-styled climate ‘contrarian’ Matt Ridley has steadfastly refused to disclose how much cash he makes from the large opencast mines operating on his family estate.
The free market advocate has intimated his share of the bounty from the Northumberland mines is small in comparison to the amount taken by the government (which owns the coal).
Lord Ridley told us: “I receive no financial benefit other than a wayleave in exchange for providing access to the land… the wayleave is very small indeed in relation to the value of the coal mined from my family’s land.”
The Viscount is clearly suggesting that his income from coal – which he has declared at the House of Lords – is moderate and, therefore, has no impact on his vociferous and influential attacks on the regulation of fossil fuels.
But one person has certainly grown extremely rich from the mining of coal from underneath Ridley’s beautiful Blagdon Estate, just north of Newcastle.
Harry Banks, 74, from Durham, and his immediate family have pocketed £3,659,000 in the last year alone through the firm that does all the mining on the Ridley estate. Banks and family own the whole company – including the £158m that the firm boasts in assets.
Grandpa Harry Banks, who we assume is the company’s highest paid director, awarded himself an austerity-defying £84,000 pay bump in 2014, according to newly published accounts.
We do know that Banks took home £284,000 in pay and a further £35,000 in interest for money he is owed by the family firm. This isn’t much, considering he was taking £750,000 in salary before the 2008 economic crisis.
His 42 percent salary boost was awarded despite the fact that the average pay for the 410 miners, and other staff, who were making all the money, fell slightly during the same year.
The massive profits have been driven by the increasingly rapid mining of coal on Ridley’s estate, despite the dire warnings from scientists and campaigners that coal must stay in the ground if we are going to save human civilisation.
Banks Group operations at Shotton Mine, Blagdon Estate. Photo by Brendan Montague
Their company, Banks Group Limited, made operational profits of £27.3m in 2014: almost three times as much as the £11m from the previous 12 months.
The company boasted £128m in turnover for the year, £94m of which came from the mining of coal. And, 82 percent of this (£78m) was mined from sites known to be on Ridley’s land.
But the really shocking thing is just how much the family has already made from mining coal.
A DeSmog UK investigation has found Banks and his immediate family have cashed in on £20.35m through salary, dividends and interest in the last decade alone.
The firm has in the last 10 years enjoyed a turnover totalling £636m, operating profits of £55.4m and has mined £468m worth of coal.
Do they really need to keep mining money out of the Northumberland countryside, putting their own children’s future in serious jeopardy in the process?
And, it seems surprising that Ridley – who believes the market is the perfect mechanism to ensure fairness – would be making considerably less from the coal on his estate than the man he lets manage the actual work.
Millions of Tonnes
An in-depth analysis of the accounts by DeSmog UK has established that Banks Group spent £5.1m in the last year on “operating lease rental for land and buildings.”
All things being equal, £3.1m of the lease rental would relate to coal mined from the Blagdon Estate – very close to the £4.1m that DeSmog UK estimates Ridley earns.
The company directors – not all family members – took a total of £895,000 from the £15.6m paid out in salary and wages by Banks Group Limited. The average salary for non-directors is £36,000 each: about the same as Banks earns solely from his long-term loan to the company.
The accounts also show that a million tonnes of coal were mined from the Shotton opencast mine, and a further 371,000 tonnes from Brenkley in the year leading up to September 2014. Both sites are on Ridley’s estate.
Our analysis suggests Banks Mining made £56 for every tonne of coal mined during the year, which is more than the £40 per tonne that we estimated the company sold its coal for.
And there is no need to worry quite yet that the company is going to get hammered by the collapse in the coal price; they lock down contracts before they do any mining and also wisely spent £763,000 in 2013 hedging against a fall in coal prices.
The latest accounts were published this month, stating: “Forward prices for coal have declined significantly. Whilst forward sales contracts currently in place will enable the coal division to deliver similar trading results in 2015 to those in 2014, the directors expect profit levels to reduce in 2016 if prevailing market conditions continue.”
Indeed, the real threat to the company is Ridley and his anti-wind brigade. The official accounts also note: “The potential for future onshore wind farm development may be adversely affected by the outcome of the next General Election.
“A Conservative administration may seek to remove subsidy entitlement for onshore wind farms consented after the May 2015 election which could cause such developments to be no longer commercially viable.”
DeSmog UK provided Banks Mining with our figures and calculations so the company could correct any errors.
Mark Dowdall, environment and community director at Banks Mining, said: “As with any other reputable business, our accounts are open and lodged at Companies House for anyone to view should they wish to do so.
“The Banks Group is a 39 year-old family-owned business that employs over 400 people across a variety of different operational areas, including in many communities in the North of England and Scotland that have been hit extremely hard by the decline in traditional industries over recent decades.”
Julian Christopher, of Footprint Public Relations, represents the firm and responded when we asked again whether the company would comment on our approximation of Ridley’s earning from coal.
“The comment provided is all Banks wish to say, and responsibility for the accuracy of any figures you quote or assumptions / claims you make in the piece is obviously down to you.”
So, the question remains, if Mr Harry Banks Esquire is smart enough to earn millions for his family from the coal lying under the Right Honourable Viscount Ridley’s family estate, why isn’t our peer of the realm?
Photo by Kyla Mandel
Updated 25/01/2017: The first line of the penultimate sentence was corrected.