Often Partisan

Pocketing Expenses Pt II

A week ago, I ran an article on this site with respect to the wages of Acting Chairman of BCFC Peter Pannu. Mr Pannu had been roundly criticised in from all quarters for a salary of close to £700,000 at a time when Birmingham City are close to the wall financially.

Mr Pannu responded to the Birmingham Mail that he only took £250k gross salary and the remainder was “pocket expenses” used for the salaries of his HK staff when travelling to the UK and suchlike.

Yesterday, the accounts for Birmingham City PLC were released. Birmingham City PLC is the UK parent of the club and sits one layer above the club and one layer below Birmingham International Holdings. BC PLC was the former holding company that was listed on the Alternative Investment Market (AIM) under the days of Sullivan, Gold and Brady and was the company that was bought by BIH when they bought the club. As BIH now own the vast majority (96.58% or so) of the shares, the company was delisted from the stock exchange.

These accounts are very interesting. They confirm that one director within the BC PLC group was paid £688,000 – but they also give a breakdown.

As you can see, these accounts state that one director in the group received £661,000 as a salary with only £27,000 paid as benefits in kind. Unfortunately, this conflicts with what Mr Pannu told the Birmingham Mail. It’s also germane to note that these accounts (like the ones for the club) were signed off by Mr Pannu.

Whilst I understand that a person in the position of Mr Pannu is going to receive a large salary, and the usage of a house and a car whilst in the UK I must admit that I personally think that a director has the responsibility to lower his wage expectation when a company is struggling – particularly when that is down to cashflow problems. I would like for Mr Pannu to explain why he told the Birmingham Mail what he did when it seemingly conflicts with what is written in the publicly available accounts that he himself signed off.

Most of all, with the financial situation seemingly heading towards meltdown I’d like some reassurance from Mr Pannu that he has lowered his personal salary and/or expenses to help the club and company out in a time of distress.

A copy of this article has been forwarded to Mr Pannu for his comments.

Should anyone wish to obtain a copy of the accounts they are available from Companies House for £1. The Company number required is 3304408.

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79 Responses to “Pocketing Expenses Pt II”

  • Vern says:

    Pannu intact said he was paid the money as a salar which was then used to pay other employees expenses. Not his own. Hence this disclosure doesn’t prove or deny his story.

    If expenses were paid directly for the employees it wouldn’t be disclosed as directors emols. It doesn’t matter what Pannu used the cash for, would still go down as salary.

    I see no sence in it though as this would all be subject to the highest rate of tax, I would assume not all the employees fell into this bracket.

    • Vern says:

      Apologies for the typos, bloody iPad.

      One more thing, purely hypothesising, could the £400k ish difference have been used to pay Carsons bail? This is in effect him paying his own bail, the only way hecouldhave done it with assets frozen.

  • Liam moakes says:

    More good work sir. Can I ask you for a prediction?
    Is your gut feeling that we will see the season out without administration or not?I know it’s impossible to call really, but I really hope the sale of a player or two suffices until the Carson trial in April at least and then hopefully the picture will become clearer.

  • Carson Yeung says:

    Two little dodgy blokes sitting on our board
    One named Peter, one named Yeung
    Fork off away Peter, Fork off Yeung
    My new family from China speak with dodgy forked tongue

  • daddybluenose79 says:

    outstanding reporting but i doubt we will get a response from pannu it seems to me that it is simply a nice lump sum for his time before the big A arrives. The only true undrrlying fact is we will persevere and kro

  • Micky says:

    You do so much hard work….if it wasn’t for this site I wud really struggle without all this information as I live in Ireland and the blues are not very well followed hear! Nice to have a good regular insightfull piece to keep me fully updated!

    Very interested to hear pp’s response….is it in him to admit defeat? Doubt it

    • Mortonsblue says:

      Micky I would be absolutely amazed if Pannu responds. I would also be amazed if his shadow ever darkens these shores again.

  • Liam moakes says:

    Mortonsblue, yes I do. I can’t see another reason for trial being adjourned again.

  • Evesham blue says:

    So many smoke screens. Don’t believe a word PP says now. We don’t have any transfer embargo’s on us. We are probably better off than a lot of clubs in football. Cash flow is a problem because of CY arrest. So feck off and sell to someone who can put money in to cover the cash flow problem instead of delaying your trial and prolonging the agony for the fans. We don’t want you anymore. You are hurting us.

    • Support your club - Don't go down he says:

      Fill the ground improve the cashflow.

      Keeping the club going is also a responsibility of us fans. We had Wembley and Europe because of it. Sadly a high percentage of those who enjoyed these games have betrayed the club same as the premier league newbies.

      Can’t keep ignoring that. Especially when the filth get 6x that 6x what we get for a midweek home game.

      No worries though the usual suspects will be doing the job for the rest of you tomorrow

      • stu says:

        Fill the ground will fill their pockets.
        When will you guys understand that the more you spend at the club, the more the directors will siphon off into their own pockets.
        Boycott the club to force a sale. Even going into administration might allow us to start progressing.
        Unfortunately we are just in a state of limbo at the moment

        • Wingman Blue says:

          Spot on Stu. Whilst i would find it very hard to boycott the club, it certainly looks like too many have already lost faith.
          PP, if he is genuine, clearly doesn’t understand that you lead by example.

          • Conbcfc says:

            How is that going to look to potential investors?
            If we stop going down we look fickle. Like the muppets with the bed sheet the other week, it makes out (what used to be loyal) fans look stupid and not worth the hassle of spending money on. Fill the ground in the face of adversity and that will benefit the club in the long run. You won’t see a return for your money at most clubs so don’t worry about lining their pockets and support the team and the club

        • Support your club - Don't go down he says:

          What will happen to the club if everybody stops going down?

          Explain that one to me please.

          • chris says:

            Admin hopefully, which means Pannu and Yeung will be history and i have no doubt it will be very painfull for Blues, but it maybe anyway, even under Pannu we may sell our best assets, get relegated and go into admin anyway.
            Even if Blues got another 10000 on the gate to take our average to 26500, it would only pocket the club £2 million over the last ten games of the season.
            Pannu was talking about selling Butland for something similar to the start of the season, so it probably means £2 million isn’t enough to keep us going till June.

  • Eric says:

    What ever happened to the Italians? Have they said anything? Or are they lying low to wait for the big A? May of missed it being in Canada. Have to say that this site is better than the Mail offerings which tend to be repetative – however we do need the media to probe as well. KRO

  • Letsby Avenue says:

    :-)

    I was the 0.0001% that thought OJ Simpson was innocent !

    :-)

    If I can use the “L” word?

    Your interpretation AJ, and the questions you have found fit to raise (justifiably imo), would suggest that Peter P has misled or misdirected our local reporters (who have to report in good faith if they don’t want the door slammed in their faces.)

    It looks like he may have told a “Lie”.

    I find this hard to accept, believing in his experience and knowledge—why would he Fib when he knew, obviously that the second tier accounts were coming?
    That isn’t logical.
    AND—it doesn’t matter whether Pannu, Hui or Dunford, ‘signed off’ on any auditor’s accounts.

    The audit stands or is contested (we’ve been there}—-so, in simple terms, why would Pannu explain in one way, publicly, if he knew he was going to be disproven a week later??

    That doesn’t make any sense.

    Pannu isn’t thick. He isn’t like that Doncaster owner who was playing the shell game with finances, confusing the amateurs and only being caught indirectly by the semi-pros.HRMC & VAT inspectors.
    Bates has got away with so many ‘dubious’ deals he makes Paladini look an amateur.

    I still don’t understand one thing.

    If what Peter P calls “pocket expenses” equates with what we in the UK know as “Petty Cash”, then it is audited. Down to the last receipt for paper clips or a massage.

    Although those items will be being taxed BECAUSE they have gone through his “salary”, whereas they might not have been if they were bona-fide disbursements for enetertainment (dinners etc) claimed by the visiting hordes.
    Whatever….
    He has to be on solid ground.
    He knew what each of the two audits revealed, he ‘explained’ to the only journalists who were bothered – they reported in good faith – so why would he L.L..ie?
    …………..
    Pannu seems to me to be a combative and secure personality.
    And a bit of a wum that people don’t appreciate.

    Remember last year when the hordes starting chanting “Where’s the money Gone?” at him…..and he waived his wallet at them with a smile.
    We had weeks and weeks of forum complaints about his response – the bullies outflanked by wit couldn’t take it.
    …………..

    The questions you raise, HAVE TO BE RAISED.

    Because we can’t just think, oh well, he’s explained everything…when he clearly hasn’t for some people, so the questions have to be raised.

    Personally, I still think Pannu needs to be more explicit, because as he himself has said, Administration is a possibilty (a lot of salt needed there, imo)— but, as I’ve said, I think Pannu is a deft and confident negotiator. He has the courtroom experience to wind-up-anatagonists….and ALSO, make people “rush-to-judgement”.

    I doubt that he has “L>>L>>>ied”, I think he is not being as straightforward as he could be, which might be a result of his wum character or his sadness at keeping us afloat and being abused.

    ……….

    • chas says:

      Letsby, Love your comment re .. The Bullies being outflanked by Wit ,etc.’..Great , and so true..

    • Wingman Blue says:

      Letsby, you’re obviously one of those great guys that thinks the best of people. Unfortunately, in my experience I have had people working for me who have blatantly lied, even though they must have known I would find them out. I put it down to ‘school homework syndrome’ – i.e hope against hope you won’t get caught out even though you know you probably will.
      P.P. might be innocent. Then again, he might not care what comes out a day or two later. Look at the way politicians promise, knowing they’re never going to deliver.

  • Blue in Spain says:

    Dan, you have printed the 2011 headline figure alongside the 2012 figure, and it show an overall reduction of 41k, so costs have been shaved somewhere?

  • Masaccio says:

    Pannu fiddles whilst Rome burns

  • brocklbank says:

    is cy,s son still on the board?
    does he still getting his education over here?
    does he still live in the house they purchased in london?
    WHOSE PAYING FOR THIS IF ALL THE ASSETS ARE FROZEN??????

    • almajir says:

      Yes he is
      Don’t know
      Don’t know

      The house is paid for outright. As pointed out previously on this site it’s not included in the asset freeze. Also, some of Carson’s frozen money is allowed to be used for day-to-day expenses anyway.

  • StevieW says:

    Well it just gets better every day(Not). So do I read it right that Pannu had a salary that was part earnings and part slush fund to cover un audited expenses of others.

    Are there grounds here for Pannu to end up in the dock with his mate????

  • arthurc says:

    I think what Pannu may have done is received the 661K then claimed c400K as his personal expenses, and shown that on his tax return, therefore not receiving a personal tax liability. He may have claimed that these monies were paid to overseas coleagues – when in reality to another little Chinaman awaiting clink? This would fit with his account of events and avoid a massive UK tax bill. However, HMRC would need to be convinced that these expenses were genuine, which sounds highly unlikely. So it sounds to me that he’s found a little angle to squeeze money out of our dying club so that he can channel it to Yeung.

    The question is, when we sell Butland etc, where will the money go? I can see Pannu’s next expense payment to his entourage being c£4M.

  • Support your club - Don't go down he says:

    How can it be that the highest earner can sign off the balance sheets??

    Obvious recipe for disaster.

    I agree with your comment Dan that ‘that a director has the responsibility to lower his wage expectation when a company is struggling – particularly when that is down to cashflow problems’ but I’d go further and say he should provide us with a breakdown of where this huge sum goes. Like most people who manage a budget have to do.

    The quote of £400K for staff involved in the HK holiday fortnights, who are they? What column do their wages sit on? Bin the trips to HK and use the 2013 communication network and keep the dough in the club.

    • almajir says:

      Paul – I have the weensiest suspicion that this staff thing was a red herring.

      • Paul Carter - The Voice Of Reason says:

        Wilfully provising false information to the taxman is considered a serious criminal offence in this country.

        As PP is a barrister I can’t see him doing that so the HK staff may be out there.

      • Mjt says:

        So ‘Support your club – Don’t go down he’ = ‘Paul Carter – the voice of reason’ it has been obvious for a while but it is useful to have the confirmation. Very peculiar.

    • Blue in Spain says:

      Zigic signs off the balance sheets…. who knew!

  • bkkblue says:

    Looking forward to readiing ‘Pocketing Expenses pt III’, when the BIHL accounts come out. I wonder if there are any more directors salaries being paid out there….

  • Blueboy88 says:

    Almajir – With Administration in 2013 more likely by the day, & the window of opportunity to sell the club firmly slammed in their face , could BIHL just cut their losses & close down BCFC , sell of the saleable assets , players, ground etc & be done with it ?

  • SirHarry1875 says:

    Thank you Almajir. Another fantastic piece of journalism from the number 1 Birmingham City site.

  • andy says:

    Great write up. Remember all, this is the same guy that waved his money at supporters, the same guy that dodged doing a phone in on the radio, its a disgrace.

  • Art Watson says:

    Almajir.

    What role did the clubs FD play in this matter?

    Surely he would have been made aware of this payment and should of challenged it.?

  • Mickey07 says:

    Mayor

    Looking at the bigger picture is there anything in all of this that the police or I.R. Would interested in?

  • swissjonny says:

    According to Sky Sports News-If they are to be believed- we are looking at a Keeper from Celtic.Looks like JB is on the way out.If they are to be believed!!

    • chris says:

      i read or heard somewhere and i think it was tom ross saying if butland left he would go with doyle and townsend

  • Agent McLeish says:

    I’m very surprised that will all the dodgy stuff going on that the B’ham Mail is not digging to expose what some would accuse as a bunch of charlatans conducting dodgy dealings. Maybe they are and I apologies if that’s the case but they seem very very passive in all this. Can you image if local press in Liverpool or Manchester would be as passive if the same was happening to one of their major clubs?

  • Ali Duncan says:

    Very well written. I look forward to not seeing a response from Pete.

  • Brumboi says:

    Balanced argument: –

    Zigic Salary = £2,600,000 (2,6 Million Pounds) (50k per week x 52)

    Pannu Salary = £661,000 (Six hundred and sixty one thousand pounds) That’s based on the most extreme case of the expenses going straight into his pocket, allegedly.

    Whilst not defending PP, I would say he is more worthy of his salary than Zigic. Yet tomorrow, like all games, the fans will be applauding Zigic! Why?

    Zigic knows his 50K weekly cheque is damaging our club, and is our biggest financial liability; yet he and his agent rebuff all transfer interest because they know his current salary won’t be matched by any other club. Sorry, but I don’t buy into this “I love it at Birmingham” and “my kids are settled in school here” blah, blah, blah. I’m guessing his kids wouldn’t be as settled if he was on just 10K per week.

    The FACTS are Zigics salary is far more damaging than PP’s. But Zigic is applauded, whilst PP faces constant verbal abuse.

    • almajir says:

      Zigic can score the goals to keep us in the division – which will be worth more than his wages.

      If Pannu is worth 13k a week, give him a pair of boots and a squad number.

      • Brumboi says:

        How many has he scored this season, and what players could we bring in if we removed him from the wage bill?

      • Brumboi says:

        I’ve just checked his record. 5 goals this season.

        Are you honestly saying we couldn’t get a replacement for a fraction of his wage who could score 5 goals from now to the end of the season. There’s a strong possibility that Adam Rooney may have scored 5 goals this season for us.

        Don’t get me wrong, I like Zigic, but he does miss more than he scores. And his 50K per week is more damaging to our club than PPs salary.

        • chris says:

          We are selling our future e.g. Mutch and very probably more of our future this month just to pay this greedy player.
          He could defer 50% of his wages for a year or two if he cared about the club so much.
          ZIGIC’s GREED IS KILLING THE CLUB.
          We may end up being relegated because we sell the players who may keep us up, just to pay this selfish person’s wages.

          • almajir says:

            Would you defer half your wages because the customers asked you to?

            Seriously?

          • Brumboi says:

            100% right Chris.

            He’s burdened us since relegation by refusing to leave. But I understand when fans say why should he give up his wage. The FACTS are he don’t care about us, but nobody seems to be highlighting this. Instead it’s all about PP, rather than the bigest problem we have; Zigic.

            I’m not saying it’s wrong to have a go at PP, but maybe the energy spent should be to get Zigic out.

            Portsmouth had the same problem with Ben Haim, which the fans realised and exerted presure on him to go, thus reducing their wage bill. Link below.

            http://www.portsmouth-mad.co.uk/news/tmnw/benhaim_finally_leaves_751581/index.shtml

          • Brumboi says:

            Almajir,
            Firstly, I thank you for the hard work you put in to keep us fans informed, and congratulate you on the success of your site.

            About this particular article: –

            You are suggesting PP reduces his wage because the customers asked him to?

            Your comments here- I personally think that a director has the responsibility to lower his wage expectation when a company is struggling – particularly when that is down to cashflow problems.

            Why do you think it’s right for a director to reduce his 661K wage, but not a player (who isn’t producing the goods) to reduce his 2.6M wage. They are both employees of BIHL.

      • swissjonny says:

        I fear a certain song making reference to pies may be heard if he took to the hallowed turf!

        • Blueboy88 says:

          Swissjonny – Clark had a good look at Pannu on the training ground before Christmas,
          thought he couldn’t be any worse than Jervis…& offered him his favourite squad number 688k
          which apparently is seen as a very very auspicious number in HK , & supposedly brings the wearer great financial benefits..for seemingly very little effort..

          Feed Peter Pie & he will score…

    • Agent McLeish says:

      Club agreed Zigic packet and did not install a relegation clause – simple as. Wasn’t PP Vice Chairman at the time? Was agreeing to that contract the action of a good lawer? Anyway why should NZ take a pay cut, it’s not his fault for the poor management of the club; despite what people say most of them would do exactly the same so stop judging him and focus on the real issues.

      • Brumboi says:

        I agree, why should he? The facts are NZ knows his salary could take into admin, but he refuses to go because he knows he’s on a good thing here. Like the CY song goes, NZ doesn’t care about us!

      • chris says:

        Doesn’t have to be a pay cut, just defer it like some Portsmouth players did.

  • Paul Carter - The Voice Of Reason says:

    Total bollox

    Zigic won us a cup at Wembley FFS

    Paid for his wages forever

    Pannu does f*ck all for his. Does nothing .

    comment edited

    • Brumboi says:

      Please keep emotions out of this, and deal with the facts.

      Is anyone saying NZ is worth 50K per week, especially in our current financial situation?

      Is anyone saying his 2.6M wages are less damaging to our club than PP’s 661K?

      • SirHarry1875 says:

        Yes they are. Zigic can keep us in this division which makes us more appealing to prospective buyers.

        And that is the end of the argument.

        We are a football club, forget his salary we need points on the board. We need to score goals and win games and in order to do that need our best players.

        • Brumboi says:

          Sir Harry,

          Zigic has only scored 5 goals this season.

          Many would definately NOT put him in our ‘best players’ category.

          And as you say, to make us more appealing to prospective buyers, we need to stay in this division.

          Even you must agree we expect, and need more than 5 goals from a center forward.We could bring a player/s in on a fractions of his wages who would be more effective. Adam Rooney would probably have scored 5 this season (just useing him as an example).

          Also, keeping Zigic may mean we have to sell a player such Redmond in order to pay his salary.

    • Brumboi says:

      Would you bring back AM as manager and pay him 50K per week. Afterall, his tactics did (useing your words) win us a cup at Wembley FFS?

      Maybe we should have given AM a contract for life because he won us the cup!

    • chris says:

      12 / 13 guys won the cup not just one & one who can’t see or doesn’t care he is killing the golden goose.

  • marc says:

    I just want to say a massive thank you for the great job you do keeping us informed with the going’s on down blues. Thank you.

  • prewarblue says:

    NO money has left St Andrews to go to China !!!!,,,,,who said this ?,,,,,,,Are all the staff employed by Pannu personally [ not the club ] paid in the U.k ?,,,,,,would the taxman be interested in “cash in hand” payments to those staff,,,,,you bet he would,,,,
    Who was it that left the HK police under a cloud for “bribery and corruption charges,,,,,,who signed off the accounts now showing the money,,,,,,and he expects ME,,,,,let alone any one else to believe a word he says from which ever face he uses at the time

    Theres an old saying,,,”You can fool some of the people some of the time,,,,,but you cant fool all the people all the time

  • Art Watson says:

    Here here!

    Glad you have worked out what’s going on!

    How much more will they take before the club is on its knees?

    And he blames the fans for not financially supporting the club.

    Wonder how many will turn up for the next home game?

  • Jaffa says:

    It’s obvious that we are not as skint as Ali Ba Ba would have us all believe.If we were really on our arse then they would of sold us.It stinks to high heaven!

  • andy says:

    Im sorry but there is no point in having a pop at Zigic, he aint the owner, he just works at the club! Birmingham offered him the contract, Zigic is honouring his side of it, so should the club.

    • DoctorD says:

      “Honouring” his contract is a very lofty word for sitting on the bench, farting around on the pitch, and not scoring any goals.

    • Brumboi says:

      PP aint the owner, he just works for the company. BIHL offered him the contract. PP is honouring his side, so should the company.

      But everyone seems to be having a pop at PP, but nobody mentions how damaging the Zigic situation is. Zigic is taking the money, and why shouldn’t he? Eventhough he knows it’s crippling our finances.

      As I originally said; I’m NOT defending PP, but just stating that Zigic salary is more damging than PP’s.I think you may agree with that.

  • Bluenosesol says:

    HMRC may be interested in PP’s expenses, as I know that on occasion that my expenses have been delayed because they have been caught up in an HMRC inspection.

    HMRC Guidelines

    It’s essential that you keep records of any expenses and benefits you provide to your employees. You’ll need these records to make sure that your forms P11D, P9D and P11D(b) are accurate at the end of the tax year, and to ensure that you and your employees pay the correct amount of tax and National Insurance contributions (NICs).

    You also need to retain these records in case HM Revenue & Customs (HMRC) ask to see supporting paperwork if they have any questions about how you’ve accounted for the expenses and benefits you’ve provided to your employees

    KRO

  • Mike says:

    I wonder if it would be worth the Blues trust hiring a business lawyer to look into this matter.

  • Support your club - Don't go down he says:

    I think HMRC will probably be having a closer look shortly

  • SirHarry1875 says:

    I have a feeling that whilst we are all posting on here Almajir is on the case and alerting/contacting all sorts of contacts/officials etc to see if anything can be done.
    He puts the local media to shame with the way he goes about digging for information to keep us informed.

  • Blues1875 says:

    It’s a simple thought .. if you have owners that are not local and I mean in the UK to keep an eye on the running of the club not just financial but all matters on a daily/weekly basis you have a recipe for disaster this is where we are.
    Chelsea for one have owners who yes have cash readily available but more importantly cares about the club (maybe not their managers) but deep down he wants to win Yeung has never cared if we win he cares about his investment which to be fair is his perogative
    Fans care if we win period
    As long as his name remains at the Blues helm we are in deep doodo


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