The chair of a local YMCA who is being sued over a disputed £18,200 pension liability has said he plans to give up his legal battle and close down the charity because it cannot afford further costs.
Colin Shaw, chair of Hirwaun YMCA in south Wales, has been sued by the YMCA Pension Plan Trustee, which runs the pension scheme for most of the country's YMCAs. The pension plan is £29m in deficit and was closed to new entrants in 2007.
The PPT is in dispute with a small group of other local YMCAs over their debts to the scheme. One, Hastings and Rother YMCA, has said it fears there will be several other cases of legal action against individual trustees if the PPT wins its case against Hirwaun.
Two Hirwaun staff were members of the scheme, but the charity's trustees dispute liability for its share of the deficit because they say the charity itself never signed up to the scheme.
Shaw said he expected his organisation would have to sell its building and close down next year in order to pay the pension debt.
"Our legal costs are rising and we do not think we have a good enough chance of winning a court case to continue," he said. "We have already run up several thousand pounds in legal bills, as well as the original debt.
"We don't have enough money to pay the pension debt and legal costs without selling the building."
Shaw added that the PPT had previously offered the charity the chance to make repayments starting at £151 a month until February 2011 and that the charity would inquire whether that offer remained on the table.
"We can afford to make repayments at that level," he said. "But we cannot afford repayments to rise much above that - and they will, because we have been told we will have to repay the entire debt inside 10 years.
"We will also have to pay at least some of the legal costs of the Pension Plan Trustee."
Shaw said he had hoped to sell the building to another YMCA and lease it back, but now expected to have to close the building and make the two staff who work there redundant.
Shaw said he had been told by the PPT that he would not have to pay personally for any debts the charity could not pay, but he added that it would now take "a miracle" to save the charity from closure.
Nobody at the Pension Plan Trustee was available for comment.