Mandelson confirms Rover investigation
Updated on 06 July 2009
Business Secretary Lord Mandelson announces a serious fraud office inquiry into the collapse of MG Rover, four years after the protests by thousands of workers who lost their jobs.
In a written statement, Lord Mandelson said that the SFO would look to see if there were "grounds for prosecution" following the recent long-awaited results of the Rover report.
But the executives who used to run the company, who are known as the Phoenix Four, said the investigation was "ridiculous". The SFO's involvement follows a four-year probe into the Midlands carmaker's demise. Birmingham-based MG Rover 2005 collapse led to the loss of 6,000 jobs at the carmaker and many more at affected suppliers and dealers.
The four executives in charge of MG Rover at the time reportedly said then there was "no suggestion of improper conduct". The Government launched an investigation immediately after Rover's collapse to examine what went wrong between Phoenix Ventures acquisition of the firm in 2000 and administrators being brought in. But the inquiry took far longer than first thought and has cost the taxpayer £16m to produce.
The report was finally submitted around three weeks ago and there were calls last month for the findings to be made public. However, the Department for Business, Innovation and Skills said the publication of the independent inspectors' report into MG Rover would be delayed further "to ensure any potential prosecution is not prejudiced".
Samira Ahmed spoke to a consultant at the law firm DLA Piper, Robert Wardle.
He said: "I would hope if there is to be an investigation by the SFO it will be on new material. It will concentrate on whether an offence has taken place.
"There will need to be a certain amount of investigation, but presumably after four years the basic problems has been identified, where there are possible criminal offences they have been identified, and the SFO can focus on those and complete its investigation as quickly as possible."
When asked about the four-year lapse since the collapse of MG Rover and the start of this inquiry, Mr Wardle said: "If evidence had emerged during the course of the inquiry, I would have expected it to be referred to the serious fraud office more or less immediately.
"Whether this is something that has come up as a result of coming to the conclusions, or something that has arisen that is new, I can't say. But certainly it is not the best position to be in."
Richard Burden, MP for Birmingham Northfield where the MG Rover plant was situated, told Channel 4 News: "I have really mixed feelings about all of this."
"If there are grounds for investigation… then obviously that’s got to go ahead. But it’s over four years now since MG Rover collapsed and nearly 6,000 people at the plant lost their jobs.
"People in the area need answers – and they still haven’t got those answers. If this leads to further delays, that will be really frustrating for so many people.
"I don’t buy the conspiracy theories, that somehow this is the government trying to kick the issue into the long grass.
"If the government refers a report like this to the Serious Fraud Office, that gives the government less control over the timing of events, not more control.
"But there’s no doubt that in the area… they do need answers.
"So my appeal to the government and to the Serious Fraud Office is: if there are further inquiries to be done, get those finished as quickly as possible and get the inspector’s reported published as quickly as possible.
"The government was in a sense damned if it did and damned if it didn’t.
"It took them (the inspectors) four years to report. It took them £16m of public money to report. A number of us wonder why it took so long and why it cost so much.
"The important thing now is...the report needs to be published as quickly as possible, consistent with not prejudicing any possible legal proceedings, because people in the area, and most particularly those who lost their jobs and their families, they need answers.
"The tragedy was that they (MG Rover) were never able to find a partner, the tragedy was that when the end came, the people who suffered… were the employees of the company, who paid with their jobs and who paid with their livelihoods.
"That’s why we owe it to them to find out exactly what happened, what went right, what went wrong, but most importantly, what the truth it."
