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bubbaclaire
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We are an incorporated Ltd company run as a charity,with a management sub committee and have Articles Of Association. Within these it states any changes to our Articles must be agreed by the PLSA. We want to move away from the PLSA as we are struggling to maintain a Committee, is there any way of getting rid of the PLSA???

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So literally ending our membership means we can make a new Articles of Association & get approval from Charities Commission then lodge with Companies House?

as a company you should be registered with companies house already.

 

If in doubt talk to your accountant.

Your articles are set up by your company....you will have chosen to add the 'agreement' bit at some point.

Speak to the PSLA but although we are members we no longer adopt their constitution as the articles over-ride these.

 

Sorry I don't know much about this way of running. I must admit though that I thought changing to these other options meant a parent committee was no longer needed.

We do not have a parent committee but we do have a group of trustees which do a similar job to governors in school. Someone needs to 'own' the company

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I recently bought my Committee Run setting - the first thing we did was leave the PSLA - simple as cancelling our membership and then changing our constitution (with committee agreement). It was then a case of using a solicitor to purchase the business - an independent valuation was done, I created a Ltd Co (the easiest part of the whole process) and I am the sole director and then I purchased the business. I assume it would be similar if you have the permission of the Trustees to 'buy them out' - most solicitors offer a free consultation. I did this to remove the necessity of the committee - unfortunately nobody wanted the responsibility - and I don't blame them.

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I recently bought my Committee Run setting - the first thing we did was leave the PSLA - simple as cancelling our membership and then changing our constitution (with committee agreement). It was then a case of using a solicitor to purchase the business - an independent valuation was done, I created a Ltd Co (the easiest part of the whole process) and I am the sole director and then I purchased the business. I assume it would be similar if you have the permission of the Trustees to 'buy them out' - most solicitors offer a free consultation. I did this to remove the necessity of the committee - unfortunately nobody wanted the responsibility - and I don't blame them.

This is a good idea as long as you can afford the rates for your buildings etc! as a registered charity we are given relief on rates and can also apply for grants etc which gives us many opportunities. The rates for our building would be 23K a year and would instantly put us out of business!. As a sole trader of course although profits may be yours so are ALL the financial issues!

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We want first & foremost to remove PLSA and change lengths of service time for Directors, change from 60% family members to 40% family members (PLSA refused) so that we actually have a chance to remain as a community preschool. At the moment it's a massive massive stress every year as the monies we have raised for a replacement building are in danger of being taken by the PLSA if we cannot recruit Directors. I feel like the PLSA own us whilst giving us nothing in return.

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Bubbaclaire that is exactly why we left - we had significant money in the bank which had been donated for our new building and PLSA would have taken the lot. Re the rates we get 'Small Business Allowance' - our rates are very reasonable - definitely not 23K - worth checking that out. I have found very little difference losing the charity status.

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I would have thought that any new constitution would have a 'dissolving the charity' process, which would mean donating the money to a charity in the event that the nursery closed even if this wasnt the PLA.

 

It might be worth checking out being a sole trader if you have the money to purchase the business if the current committee are in agreement.

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Hopeytg....how much did you buy out for, if you don't mind me asking? To be honest our preschool makes zero money, the resources aren't worth massive amounts, I'd be taking it on for the community, but that's OK with me. I run my own childminding business & this is my labour of love!

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I would have thought that any new constitution would have a 'dissolving the charity' process, which would mean donating the money to a charity in the event that the nursery closed even if this wasnt the PLA.

 

You would run under articles not a constitution. The trustees are responsible for the dissolution of the business and how disbursements are distributed (sorry about that bit of alliteration!)

You can stay with the PSLA and chose not to adopt their constitution if you are run under different arrangements.

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We want first & foremost to remove PLSA and change lengths of service time for Directors, change from 60% family members to 40% family members (PLSA refused) so that we actually have a chance to remain as a community preschool. At the moment it's a massive massive stress every year as the monies we have raised for a replacement building are in danger of being taken by the PLSA if we cannot recruit Directors. I feel like the PLSA own us whilst giving us nothing in return.

Wouldn't the money automatically go to the PSLA if you dissolved the playgroup to make it run as a business? I thought that's what happened?

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We want to change articles to allow us to make changes the PLSA will not agree to, changes which will enable us to keep running as a community preschool, as it stands, the preschool is a huge business but without a Chair (I have to leave next year) or treasurer (leaving ASAP) we have no option but to dissolve at which point the PLSA get everything. Our first step is removing the PLSA to prevent this from happening.

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The 'Business' was valued at £1 - which was paid to the Committee and then passed onto a local charity - we were the same - the setting was not making any money - we had no savings - the money we had, had been used to purchase our 2nd hand mobile classroom, 6 years ago, which had been valued at nothing - it would actually have cost more to remove it and then taking into account the staff - I have taken on their redundancy costs which are quite high as most of the staff have been with the setting for over 7 years I have actually taken on quite a financial commitment.

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You sound an amazing person to have taken that on hopeytg. I presume it has all worked out for you, although I imagine hard work.

 

Bubbaclaire, your preschool sounds like it does have money which would need to be donated to another charity if yours was dissolved, you wouldnt be able to take this into your new business.

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We want to change articles to allow us to make changes the PLSA will not agree to, changes which will enable us to keep running as a community preschool, as it stands, the preschool is a huge business but without a Chair (I have to leave next year) or treasurer (leaving ASAP) we have no option but to dissolve at which point the PLSA get everything. Our first step is removing the PLSA to prevent this from happening.

OK feeling confused.....How do you WANT to run? who is going to 'own' the business and take any profits??

 

 

 

Bubbaclaire, your preschool sounds like it does have money which would need to be donated to another charity if yours was dissolved, you wouldnt be able to take this into your new business.

unless you are setting up a charity preschool

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I've done a lot more research, so here goes:

 

Whilst we do have money, we currently make no money, we have enough to cover 3 months redundancy of all staff, we have fundraised enough to replace our temporary building, we haven't saved anything in 3-4 years. In this regard, I think we need to stay in our existing form.

 

We want to remove PLSA first and foremost, then change our articles to allow Directors to be reinstated every 3 years if the Sub Committee feel it is appropriate and beneficial for the charity for this to occur. We basically want to safeguard the business as it is and make it less likely the PSLA could benefit from the situation of not being able to find new directors, as at the moment it is exceedingly likely we would have to close imminently.

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Contact your local authority early years business support team if you are still unsure - they will be able to advise you of the best course of action. Leicestershire's BSA has had a look at the comments above and noted that there is some very sound advice on this thread. Please feel free to PM me if you would like me to pass on any questions or queries to our BSA.

 

Laura

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  • 1 month later...

Very interesting discussion.

 

We are a community preschool, registered charity and company limited by guarantee. All our directors and trustees are parent volunteers. The Pre School is well established and popular, being in situ over 20 years.

 

We are struggling to find parents willing to take on the responsibility of being on the committee, plenty want to help out but dealing with current staff issues, paperwork etc is proving time consuming, we all have jobs/children too.

I am the current chair and a friend is the treasurer, we are already find it all such hard work and it's only been six months.

 

I wouldn't to buy the business, I don't think I know enough and can imagine the same from other parents. What other options could we have, to keep running as a community preschool/charity but take off the pressure of having a parent committee. Is there even another way?

 

Will follow this post.

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can you afford to have an administrator? We moved from your model some 7 years ago..i could no longer expect that volunteers had the time or knowledge to do everything. (we are still a limited company run by trustees) As manager i run the business but I have an administrator who does invoices/pays bills/wages/pensions/admissions/etc ...if you can't afford a part time admin how about getting a wages company to do that part then allocating time to the manager to do some jobs and maybe pay someone to do admissions

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