Press Report : Phoenix anger as fraud claim delays MG Rover report

Jon Griffin, Birmingham Post, 6th July, 2009

John Towers’ Phoenix Four have accused the Government of letting down more than 6,000 former Longbridge workers and deliberately stalling a long-awaited inquiry report until after a General Election. The controversial former MG Rover bosses fired a series of angry broadsides at New Labour as Lord Mandelson prepared to tell the House of Commons that a separate fraud inquiry was being launched into the collapse of the Birmingham car firm more than four years ago.

If the Serious Fraud Office (SFO) investigation is confirmed today, the long-awaited publication of the findings of the Government inquiry set up in summer 2005 will be delayed still further and potential pay-outs of four-figure sums to up to 6,500 workers will also be shelved indefinitely, with £16 million gathering dust in a bank account set up by the MG Rover Trust Fund four years ago.

The Phoenix Four went on the attack following weekend reports that Lord Mandelson had ordered a separate SFO inquiry into the collapse of the Birmingham car factory in April 2005 amid debts of £1.4 billion. Reports said that the inquiry report, now in Lord Mandelson’s hands after four years of work, had concluded there were grounds for a criminal investigation.

However, the Phoenix Four responded with a statement which accused Labour of delaying tactics to “disguise their own failings.” The statement by John Towers, Peter Beale, Nick Stephenson and John Edwards said: “If this is true then it confirms people’s worst fears about likely Government/Business Department tactics.

This tactic is probably the only way the Department of Business can realistically avoid publishing a report that, if fair and balanced, will undoubtedly be critical of their and the Government’s overall role in MG Rover’s demise. Another inquiry is the last thing people want, and failure to publish the report lets down the 6,000 people who lost their jobs. We suspect this is nothing more than a Government ruse to disguise their own failings, shift the blame to others and kick the inquiry report into the long grass until after the election, spending yet more taxpayers’ money in the process.” Statement issued by Messrs. Beale, Edwards, Stephenson and Towers, former Directors of MG Rover Group Limited

“This tactic is probably the only way the Department of Business can realistically avoid publishing a report that, if fair and balanced, will undoubtedly be critical of their and the Government’s overall role in MG Rover’s demise. Another inquiry is the last thing people want, and failure to publish the report lets down the 6,000 people who lost their jobs. We suspect this is nothing more than a Government ruse to disguise their own failings, shift the blame to others and kick the inquiry report into the long grass until after the election, spending yet more taxpayers’ money in the process.”

The Phoenix Four said there had “never been any suggestion of improper conduct by the Directors. This was confirmed in a report by the Administrators six months after they took over the running of the company. Four years on, any suggestion of another further investigation is frankly ridiculous. If the Government had been so concerned to get to the heart of the matter why has it flatly refused more than 30 requests under the Freedom of Information Act which would have revealed correspondence and documents the Directors believe would have shed some light on the Government’s role in the affair?”

The SFO inquiry will scupper the hopes of more than 6,000 ex-workers of four-figure payments from the MG Rover Trust Fund at any stage in the near future. The former workers waiting for pay-outs have so far been denied payment on advice from lawyers representing the Phoenix Four.

Money already realised by the sale of Phoenix Venture Holdings (PVH) assets includes £4.5 million for former conference centre Studley Castle and £12 million of dealerships. However, PVH says no money from the trust fund can be paid while the company still has to deal with potential creditors yet to be identified in the Government inquiry report.

[Source: Birmingham Post]

Posted in: AROnline News, MG Rover
Clive Goldthorp

About the Author:

Clive claims that his interest in the BMC>MG story dates back to his childhood in the 1960s when the family’s garage premises were leased to a tenant with an Austin agency. However, back in the 1920s and 1930s, his grandmother was one of the country’s first female Garage Proprietors so cars probably run in his genes! Admits to affairs with Alfa Romeos, but has more recently owned an 06/06 MG TF 135 and then a 15/64 MG3 Style… Clive, who was AROnline’s News Editor for nearly four years, stood down from that role in order to devote more time to various Motor Racing projects but still contributes articles on as regular basis as his other commitments permit.

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