MG Rover collapse report still unpublished
By Alex Stevenson
The government’s refusal to publish a report by independent investigators into the demise of carmaker MG Rover has prompted anger from unions and politicians.
It follows the announcement earlier today that Peter Mandelson has referred the case to the Serious Fraud Office (SFO).
The business secretary has asked the SFO to consider whether a criminal investigation should take place.
Already the probe is mired in controversy, having taken four years to be conducted at a cost of over £15 million.
In an urgent question in the Commons shadow business secretary Ken Clarke said that delays to the investigation made further delays inappropriate, however.
“It’s quite inadequate now to decide to refer the issue again,” he said.
MGRG, the manufacturer of MG and Rover cars, went into administration in April 2005. Its demise was viewed as a major setback for British car manufacturing and resulted in the loss of 6,000 jobs.
Alan Johnson, during his time as trade and industry secretary, appointed inspectors to scrutinise the company’s demise. They delivered their report on June 11th this year, despite Mr Johnson having said in 2005: “I have asked them to report to me as quickly as possible”.
Business minister Ian Lucas responded by insisting the government did the right thing in not hurrying the independent investigators.
“It would have been quite inappropriate for the government to intervene,” he said.
Earlier Lord Mandelson said: “There has been a comprehensive and thorough investigation into the events which led to the company failing, workers losing their jobs and creditors not getting paid. The SFO must now see if there are grounds for prosecution.”
The GMB union, which said its calls for an inquiry had led to the latest move, expressed outrage at the government’s decision not to publish the investigators’ report.
Bert Hill, GMB’s organiser for the engineering industry in the West Midlands, said: “The question everyone is asking is who was responsible for the collapse of MG Rover and the loss of 6,500 jobs at Longbridge and many more within the supply chain?”
“With a criminal investigation by the SFO now a possibility the release of the report into the failings at MG Rover, including possible mistakes by the government will be delayed even further.”
Mr Lucas said publishing the report could prejudice a future trial, however, after Mr Clarke had pointed out to him “the workers are the innocent victims”.
A £16 million trust fund consisting of money raised from the asset sale cannot be released for former workers at MG Rover’s Longbridge plant until the report is published.
Four businessmen bought MG Rover in 2000 for £10, after which the company made consistent losses for several years.
In 2004 talks were entered into with the Shanghai Automotive Industry Corporation but these collapsed a year later, sending MGRG into administration.
Its assets were subsequently bought by Nanjing Automobile, another Chinese firm, which revived the MG brand and resumed production at the Longbridge plant.
News of the SFO referral came as the government released good news for the car industry. Figures out today showed its car scrappage scheme had had a positive effect on new car registrations, slowing their monthly fall to levels not seen since last summer.
