The Sunday Times Scotland carried the news that Brian Souter was now looking to the US to find a company to run his referendum in Scotland. Propounding the myth of a sinister clique undermining the majority, he was reported telling them: “If someone felt as strongly about repeal then they could launch a campaign. There’s an enormous (amount of) money coming from the gay lobby group, who are even sponsored, sometimes, by people in the City”. Patricia Nicol joined him on the sofa in his tartan-carpeted Victorian drawing room in Perth for an interview in the broadsheet. “A devout Christian, Souter is not comfortable discussing sexual mores with a stranger”, she observed. “He avoids eye contact at first and seems awkward…” Pat Nicol asked him why he thought a half-hour’s role-playing exercise at 14 was going to change a child’s sexuality. Brian replied: “We all know that when children are going through a phase in their early teens, when they are coming to terms with their own sexuality, they often have a same-sex crush. Now when they are going through that difficult stage I think it would be wrong to send a child a message that ‘gay is a good choice’, because a perfectly normal heterosexual child going through that phase could be encouraged into a series of sexual experimentations that could actually be very damaging to them. It could leave them emotionally scarred and at risk from sexual disease. As a parent I don’t want that for my children - I want them to be nurtured with things that are wholesome and good and conform to our traditional values”. The interviewer emphasised that “he says he did not experience such a crush himself, but has a close friend who did”. Adding: “He seems so awkward that I wonder how he deals with his children asking about sex. ‘I’m just a normal guy,’ he answers softly. ‘It embarrasses me. The one time Amy asked me something I said, ‘Your mother will tell you when she gets back from the shops’.”
In a letter to Brian Souter, an elderly gentleman from Broughton begged to know what he would do should one of his own sons turn out to be gay. In a handwritten reply, he said only that he was entitled to his opinion.
Then The Observer in Scotland announced: “Souter’s new ambition is to buy Herald”. Columnist Arnold Kemp, a former editor of The Herald, found, “although his spokesman, Jack Irvine, of Media House, dismissed the suggestion as fantasy, it is known that Souter has told friends that he is keen to buy the paper, perhaps jointly with his friend and fellow millionaire Tom Hunter, founder of Sports Division”. The Herald was bought by the Scottish Media Group, which owned Scottish and Grampian TV for £110m. Irvine told The Observer in Scotland: “That’s fantasy. He must have been winding somebody up” and re-affirmed Souter was willing to spend up to £2m before dismissing his pledge to go back to living in a council house in Perth as hyperbole.
As the spring of 2000 arrived in Scotland, Jack Lovie of Irvine wrote in The Herald: “May I interrupt the avalanche of intellectual debate in your letters pages on the repeal of Section 28 to inquire if anyone has heard the first cuckoo?”
Back in February 2000, after Mike Kinski, the Stagecoach chief executive had sensationally resigned, Stagecoach shares had plummeted. £265m was lost in just 24 hours. Neither was it just a blip. On Tuesday, 4 April, amidst calls to boycott Stagecoach, news broke in the City of London that - as The Herald put it - “Stagecoach shares had hit the buffers with a grinding crash…” The Scottish Mail reported: “Stockbrokers’ screens turned into a sea of red” after Stagecoach shares went into freefall. The Perth-based bus, rail and airport group, owned by Brian Souter and his sister Ann Gloag, employing more than 40,000 people world-wide, had warned that profits at its Coach USA acquisition were going to be worse than expected. They blamed difficult labour marketing conditions and a hike in oil prices. Coach USA, the largest provider of sightseeing and charter bus operations in the US, which had 16,500 coaches and 3,000 taxis and cost Souter £1.2 billion in 1999, was a price too high according to some analysts. The Scotsman’s Business View hinted: “The US had been tipped as the market where Stagecoach would find major growth. But yesterday’s news aroused fears that if it can’t get it right in the US, then perhaps its strategy is faulty”. Souter had already suffered the sudden departure of Coach USA chairman Larry King at the end of February and before that, chief executive Mike Kinski with a £1m ‘golden goodbye’ and a £1.4m pension provision. In Larry King’s case, The Sunday Herald reported: “The theory goes that King deliberately pumped up the group’s turnover ahead of its sale through a series of fast and loose acquisitions, ‘just so he could persuade some sucker to buy it’.” The Record reported Mike Kinski “quit after a series of boardroom fallouts with Souter. The antagonism reached a head in a row over the publicity Stagecoach was attracting through Mr Souter’s high profile involvement with the bitter Section 28 controversy”. In The Herald’s Business Comment, they said: “According to one insider, it was a profound disagreement over strategy that led to Kinski’s departure. The former ScottishPower director was said to want measures to boost earnings short term. Souter, on the other was said to have insisted on giving priority to growing passenger volumes at the expense of short-term profit. Amongst other business interests, Prestwick Airport in Ayr, also owned by Stagecoach, had been badly hit by the withdrawal of Federal Express. There had already been discussions in 1999 to sell Prestwick for £71 m. Now it was up for sale with a book price of £21m. Stagecoach’s Scandinavian subsidiary, Swebus was sold at a loss in October 1999 after a three-year struggle to make it pay and Souter had already pulled out of markets in Kenya and Malawi. Added to that, Souter wanted to be China’s biggest bus operator and had a minority share in a toll-road business there called Road King, which had also turned out to have been a disappointment. To clear the air, Stagecoach announced the sale of its Porterbrook, train-leasing arm to Abbey National for £1.4 billion. This was a controversial move since this highly profitable company had been contributing between a third and a half of the group’s profits, providing a safe and steady income. Despite the much-hyped new share issue to pay for Texas-based Coach USA in 1999, Stagecoach was now saying they planned a £250m share buy-back. The City got nervous and £850m was wiped off the Stagecoach share value in two hours of frenetic trading. The shares tumbled 42 per cent in two hours, falling at a rate of £116,000 every second. Shares plunged 51¼p to a four-year low of 70¼p by the time the Stock Market closed. Although more people wanted to travel by train, Stagecoach was finding it impossible to pack more paying-passengers onto its overcrowded commuter trains. Added to that, South West Trains had to face a £5m cut the following year in its annual rail subsidy. Brian Souter and his sister Ann Gloag had £170m wiped off their personal fortunes. They were no longer Scotland’s richest couple. Their new worth of £238m made them fifth behind Tom Hunter with an accumulated wealth of £400m. It was not often that Brian Souter was not available for comment to The Record but “a spokesman for Stagecoach” told them “Mr Souter was ‘on an aircraft and uncontactable’ while travelling abroad on business”. Souter’s friends in the press did their best to soften the blow. Hamish Macdonell, the Scottish political editor for The Scottish Daily Mail warned there would be “no end of funding for polls”, referring to Souter’s quest for a private company to administer a referendum in Scotland over Section 28. The paper praised him as the “tycoon with a £1m heart” over his gift of a heart scanner to Glasgow University. The Record also made a contribution, describing his donation as “typical of the generosity to charity shown by him, and, on an even greater scale, by his sister”. Ann Gloag made what was believed to have been the largest single donation to a Christian charity in Britain: A £4m floating hospital for the Third World.
The next day, on Wednesday, 5 April, 2000, Stagecoach took another tumble with £190m wiped off the company’s value, pushing it below the psychologically important £1 billion barrier. The sort of fury the City was now displaying was normally reserved for companies on the brink of going bust. The day had started badly with a slide in the share-price target from 210p to 85p and security house Goldman Sachs downgrading its rating of Stagecoach from ‘market outperformer’ to ‘market performer’. Similarly, Morgan Stanley downgraded its recommendations from ‘strong buy’ to just ‘neutral’. Stagecoach’s value had been halved from £2 billion to £1 billion in just two days. Fears were growing that Stagecoach could be in danger of a hostile takeover bid. The Record found an Edinburgh stockbroker to beef up the news. “This is not the end of the road for Stagecoach - there are still many good bits to the business”. Gert Zonneveld, transport analyst at securities house WestLB Panmure was not so optimistic. He reported in The Herald’s Business section that Stagecoach should not have included in its exit price the £270m of Porterbrook train purchase commitments being taken on by Abbey National. The price was, he argued, only £1.17 billion and therefore at the bottom, rather than the top end of City expectations ranging from £1 billion to £1.5 billion. Once again Souter was unavailable for comment and Keith Cochrane, his new chief executive was on a flight to Hong Kong for a board meeting of the Citybus subsidiary. The City was not best pleased. Brian Souter and his sister Ann Gloag dropped further to sixth place in the league of Scotland’s richest and The Herald speculated that Souter might take Stagecoach off the stock market.
Amidst rumours Brian Souter was going to take the company private, Stagecoach spent £6.4m buying back its own shares to halt a collapse in price. Stagecoach edged up 1.75p to 65p after it bought 10.25 million in the open market at 62p. Souter had a lot of explaining to do to, not just to the City, but his institutional investors: Standard Life; Mercury Asset Management and Franklin Resources. As the following Scotland on Sunday’s Doug Morrison advised: “The buses are still running. So too are the trains. But for Stagecoach, as far as its share price and its relationship with the City are concerned, the wheels have well and truly come off”.
Just over a week later, on Thursday, 13 April, The Herald reported “Stagecoach on the ropes” after another 10 per cent slide in the value of its already battered share price. Brian Souter failed to attend a 7am breakfast briefing for City transport analysts. In just two days, the stock market value of Stagecoach had nearly halved to £1.05 billion.
Weeks later there was another resignation at Stagecoach, this time, the non-executive chief executive Jim Leng who complained Souter was treating the company as his personal fiefdom. The much-respected businessman’s resignation was not disclosed during or after an extraordinary meeting at Stagecoach in Perth. Instead, it was announced after the stock market closed for Easter. Leng was critical of the group’s corporate governance and was supposed to have made his views known to Souter after the executive chairman of Coach USA, Mike Kinski’s departure. The City saw Leng as the most independent director on the Stagecoach board.
There was still no let up in Souter’s campaign to halt the repeal of Section 28. Another of the The Herald’s morally conservative commentators, a former Conservative parliamentary candidate and historian Michael Fry warned: “We’re off along the road laid down by Hitler and Stalin” before signalling his willingness to “stand up and be counted” in support of Section 28. Fry insisted if referendum supporters hadn’t taken up “the people’s cause” against repeal, “somebody else would have”. He believed that “during a quarter of a century, Scots have grown practised in their own form of civil disobedience: a quiet, steady refusal to take, if they do not want it, what is handed down to them from on high…” Referring directly to Section 28, he declared: “This is the latest example… Ministers and their sycophants shout about homophobia, yet Scotland does not seem noticeably more or less homophobic than other countries. Scottish homosexuals are fully tolerated, and nobody is calling for constraints to be placed on them. No, the worried ones are the parents. I dare say most parents… acquire a bias in favour of that form of social organisation, which is often commended by politicians, too… They tend to think it would be a great affliction if one of their children grew up to be a homosexual… Since homosexuals do not procreate, they only increase through recruitment. And Section 28 is a safeguard against recruitment. That line of reasoning, central in the campaign to keep the clause, does not rely on the money or character of its backers”. The Herald was very generous to Michael Fry, opening up their offices for him to broker a new publishing deal, and, a week after he wrote this feature, Brian Monteith, the Scottish Tory leader was sharing with readers how he had enjoyed “Scottish crustaceans” in a late lunch with him.
The Record turned its attention on Health Minister Susan Deacon’s plans to spend £150,000 on four new Brook Advisory Centres in Glasgow, Aberdeen, Dundee and Stirling to add to two already operating in Edinburgh and Inverness. The Scottish Daily Mail simply headlined: “Fury over new sex clinics for the under-aged”. In 1998 there were 9,218 teenage pregnancies in Scotland, the highest in Europe. Of those, 4,033 were abortions. Of the 12,500 abortions that were being performed each year in Scotland, 4000 were amongst teenagers. “Deacon faces pro-life fury over sex clinics”, ran the headline. “They drew up plans to picket her in protest at the centres which offer contraceptives and abortion advice to girls as young as 12 without the permission or knowledge of their parents”. Comments were fielded from the ‘Sexfinder General’, a nickname Monsignor Tom Connelly had earnt for his vigilance of all matters sexual in the Scottish press, telling The Record: “Evidence is clear over the years that, the more the availability of contraception, the higher the number of pregnancies”. Rose Docherty, development officer for the Society for the Protection of Unborn Children felt: “The abortion figures are going up and it’s clearly time to go back to the drawing board. We are living in a sex-saturated society”. The Mail allowed “Miss Deacon” to explain; “Brook Centres do not promote under-age sex. They do provide essential information about all aspects of sexual health in a way which encourages young people to make informed choices”. Her voice was drowned by a motley-crew of moral conservatives, ‘family values’ campaigners and militant Christians. Rosie Docherty portrayed Scotland’s history as one of sexual anarchy: “For years now the approach has been to give out more condoms and more information on sex to young people, but where is the evidence it is reducing the problems when the statistics are going up?” The ‘Sexfinder General’ agreed while Valerie Riches, the director of Family and Youth Concern declared that Susan Deacon’s plans: “…Is a charter for underage sex”. Truth was: Scotland had never demonstrated a liberal sex education in its schools and was still reaping the consequences.
The attacks in the media on the Health Minister, Susan Deacon began when she started her drive to improve the sexual health of Scotland’s teenagers. The ferocity of the backlash had caught her off-guard. The health minister was branded a nutcase by a spokesman for the Catholic Church, depraved by anti-abortion campaigners and morally suspect by The Record. They even went so far as to suggest in an editorial that Ms Deacon shouldn’t be passing judgements on sex education because she wasn’t married to her partner John Boothman and they had a child out of wedlock. News that National Health Service bosses were using dance classes as a team-building exercises was the only excuse the tabloid needed to picture Susan Deacon alongside the headline: “FAT CATS GET DANCE CLASS ON THE NHS” and in another Record report by Carlos Alba, she was accused of “being the source behind a bid to destabilise the Scottish Cabinet”.
A conference organised by Children in Scotland called: Developing a Sexual Health Agenda for Scotland’s Children and Young People took a bold step. Professor Peter Aggleton, director of the Thomas Coram Research Unit, at the Institute of Education, University of London said: “Sex has become linked to infection and disease and in the case of young people at least, to unintended pregnancy. We are encouraged therefore to view sexual health in largely negative terms. It seems important to recognise that sexual health is, or should be, an affirmative concept, a state of well-being imbued with positive qualities, not merely the absence of those that are undesired. Sexual health must be concerned with the attainment and expression of sexual pleasure not with the repression of sexual energies and desires, still less with their denial”. Aggleton went on to relate how he’d trawled the various agencies working with young people on reproductive and sexual health matters and found only one - the London Brook Advisory Centre - that made any reference to sexual pleasure. The Sunday Herald reeled in the ‘Sexfinder General’, Monsignor Tom Connelly who said: “The adult world is obsessed with sex. It is time the adult world gave young people a sense of discipline”. He insisted young people wanted “discipline” and a “decent code of conduct” and declared it the responsibility of adults to ensure children were not allowed to “lose the innocence of youth”.
Next: Part 33 – Money and Connections.
garry@garryotton.com
