Leicester training firm Stride collapses leaving 280 young people without jobs
More than 280 young people have been left without jobs and training courses after an organisation aimed at tackling youth unemployment collapsed.
Stride taught budding bricklayers, car mechanics, beauticians and shop workers from across Leicestershire.
Yesterday, 85 apprentices and 33 staff at the group were made redundant when it ceased operations after its bank account was frozen.
Another 200 students have seen their training courses come to an abrupt end.
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It comes after Revenue and Customs officials launched a legal bid to retrieve £200,000 in unpaid taxes.
The move led to Stride's bank, Royal Bank of Scotland, freezing its accounts, leaving the group's directors with no alternative but to close it down.
Deputy city mayor Councillor Rory Palmer said: "This is nothing short of devastating for the city and for those people who are affected by it. Stride did a lot of important work in the city."
Coun Palmer, who visited the organisation's workshops in and around Belgrave Gate two weeks' ago, said: "I'm sure this is a decision and course of events which has caused heartache. We will, as a council, look at how we can support the apprentices in what is a very difficult situation."
The apprentices were due to be paid two weeks' wages yesterday, but didn't get their money. The £16,000 in outstanding payments will be covered by the Government over the next seven weeks. Stride apprentices were aged up to 24, with some of these owed wages of about £300.
Fraser Goodley, 18, of Beaumont Leys, who had been in the middle of a year-long NVQ brickwork apprenticeship, is owed £160.
"I am shocked," he said. "I was close to getting my qualification, now it looks like I'll have to start it again somewhere else.
"There were rumours that Stride wasn't going to be around for much longer. But our supervisor told us the construction side would not close because it made the most money.
"I had just booked to go on my first lads' holiday. I'm annoyed because they would have known before, that things were bad. But I'm lucky because I live with my parents. There are apprentices who are older who have their own places who were relying on their wages to pay for rent, bills and loans. They are in a mess."
Stride was set up in 2000 by city homelessness charity Sharp, which is unaffected by the closure. A sister business, property owner Leicester Social Economy Consortium, is also unaffected.
Stride, which also had 20 apprentices and seven staff in Nottingham, is due to go into liquidation on March 5.
Neil Money, of liquidators CBA, of Leicester, said the £200,000 of unpaid taxes was mainly related to employees' income tax and VAT.
He said Revenue and Customs had launched a winding-up petition.
David Brazier, who is a Stride director and chief executive of Sharp, said: "I suppose I'm annoyed, given the strong desire of governments to promote the training of young people, particularly disadvantaged young people. At a time of such high youth employment, the training we provide is needed more than ever. Public funding cuts, changes to Government financed training schemes and difficult economic conditions have all created problems for us.
"Stride grew rapidly to 2008 and invested in further expansion, unfortunately just before the credit crunch hit."
Building tycoon David Wilson, founder of David Wilson Homes and chairman of Ibstock construction company Davidsons Group, provided funding to Stride in 2009 after being impressed by its training schemes.
"It's a great shame," he said. "They did a fantastic job."
Are you an apprentice affected by the closure? If so call our newsdesk on 0116 222 4241.
30 Comments
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by Happy1900
Wednesday, February 20 2013, 9:13PM
“@CliveB
This is not true, look at their old website and read "http://tinyurl.com/axl9586”
by CliveB
Wednesday, February 20 2013, 8:18PM
“by DavidJCB
"@ amoros11 – They were a charity, as they no longer are trading!"
No, the article says that the charity and other company are safe. Admittedly when you look at the last submitted charity accounts, the writing is pretty much on the wall !
These social enterprise organisations do annoy me as they are mostly run by airy fairy doogooders who sit on boards for vanity purposes and have no understanding of how to run a business properly.”
by DavidJCB
Wednesday, February 20 2013, 5:45PM
“@ amoros11 – They were a charity, as they no longer are trading!”
by amoros11
Wednesday, February 20 2013, 2:09PM
“Stride charity doing it for themselves and not for young people. All such work schemes are cheap an nasty, run by providers with financial connotations under the surface A certain chief provider of The Work Program A4E are also being investigated and their name is all over the media and web. Under fraud that relates to New Deal and The Work Programme but still they get contracts and run the programme.
A4E also held the client data for the Leicester Legal Advice centre a few years ago, before they operated in this region and they lost the confidential information of 24.00 clients in Leicester and Hull. As a company that was based in another part of the country.”
by City_C10
Tuesday, February 19 2013, 10:40AM
“Leicester training firm Stride collapses leaving 280 young people without jobs – This is a very sad piece of news. However, reading the reason why this 'charity' collapsed does seem to point to human error and with the 'charity' not paying their taxes what did they expect? Many businesses turn themselves into charities to get help/relief for taxation, how ironic in this case. I truly feel sorry for all the young people who have lost their course, job, and the chance to better themselves. Alternatively, this is time for them to look elsewhere and not to give up. Also, I wish all the staff well in finding new employment. I wish all involved the very best in their future roles/careers.”
by Fern19
Monday, February 18 2013, 3:18PM
“Best wishes to all the apprentices and staff memebers!! I hope Harry finds simmat he's a decent hard working lad!.”
by JasperC
Monday, February 18 2013, 11:28AM
“DonHenson. You are right in your assertion that the employees part of the liability has been deducted from paypackets. But there is also a sizeable proportion that the Employer has to find themselves. This is the problem........
£200,000 is not a vast amount when you consider the amount of employees in this enterprise.
I await the official 'Inquest' to find out what went wrong at Stride. But I am willing to bet .....It is the same as Jessops, HMV,......The local Frog amnd Mouse Artshop, and ourselves etc. Which is...
Falling Revenues, squeezed margins and ever rising costs. Which are largely due to the Banks and successive Governments lack of forsight and action.
Small Businesses need HELP and they need it NOW.......Before we see tumbleweed blowing down the High Streets.”
by NickDiPerna1
Monday, February 18 2013, 11:08AM
“I don't agree with public money being given to these institutions. Just look at the fraud investigations into job schemes like New Deal and A4e:
http://tinyurl.com/88go27r”
by DonHenson
Monday, February 18 2013, 4:58AM
“JasperC, I'd agree wholeheartedly with you except for the fact that such a huge amount has not been paid. After all, the money was deducted from pay packets.
The small firm I run pays the HMRC at the same time as payroll. Standard business practice that appears not to have happened here!”
by motox
Sunday, February 17 2013, 9:57PM
“My son Harry Marriott was half way through his apprenticeship with stride, is now gutted and they still owe him 3 weeks monies. All they need is to finish there qualifications and then may stand a chance at getting a job, any company who are looking for hard working guys and girls get in touch give them a chance thats all it takes xxxxx”