Jean Eaglesham, Chief Political Correspondent , Financial Times, 15th April, 2009
The nearly four-year inquiry into the collapse of MG Rover has cost taxpayers more than £14.8m with no end in sight, according to official figures released to the Financial Times. Ministers are privately frustrated and embarrassed by the escalating cost of investigating Rover’s demise, at a time when the beleaguered UK car industry is lobbying for taxpayer cash to survive.
MG Rover, Britain’s last independent volume carmaker, went into administration in April 2005 with the loss of about 6,000 jobs. Ministers reacted to the pre-election furore by promising a ‘speedy” investigation that would include a review of the role of the Directors who had bought the company for £10 from BMW in 2000 – the so-called ‘Phoenix Four.” A report was expected within 18 months.
The independent investigation under the Companies Act 1985 has proved far more time consuming, complex and costly than Ministers expected. It has been led by Gervase MacGregor, a senior partner at BDO Stoy Hayward, the forensic accountancy firm, and Guy Newey QC, an insolvency law specialist. Fees paid to the Inspectors by the end of February totalled £12.2m, with expenses and value added tax taking the total bill to the state to £14.8m, according to official figures.
Every penny spent on this long-drawn-out inquiry is money that would much better have been spent developing green technology for Britain’s motor manufacturers,” Peter Luff, Conservative Chair of the Business Select Committee, said.
Ministers are concerned by the time the inquiry is taking, and government insiders point out that MG Rover’s ownership by the Phoenix Partnership – the contentious period under investigation – lasted only five years. Ten meetings between the Inspectors and officials have been held in the past year to discuss progress. The Inspectors have yet to enter the final stage of the inquiry by sending draft statements to those who will be criticised in the report, according to people close to the investigation.
The Department for Business, Enterprise and Regulatory Reform said on Tuesday that it would not be ‘practical or realistic” to set a deadline for the Inspectors’ report. ‘We know they’re working hard to complete their inquiries,” it said. BDO Stoy Hayward said on Tuesday night that it was unable to comment owing to client confidentiality.
Peter Luff, Conservative Chair of the Business Select Committee, criticised the delay in completing the report. ‘Every penny spent on this long-drawn-out inquiry is money that would much better have been spent developing green technology for Britain’s motor manufacturers,” he said.
[Source: Financial Times]
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