Call for inquiry into government funding of Norton Motorcycles – The Guardian,

Call for inquiry into government funding of Norton Motorcycles – The Guardian,

The chair of parliament’s public accounts committee is calling for an investigation into the government funding of Norton Motorcycles and has accused officials of “blindly pouring” millions of pounds of taxpayers’ money into the motorbike firm before it went bust.

Meg Hillier MP is to write to the department for business, energy and industrial strategy (BEIS), as well as the Cabinet Office, to ask for an inquiry into the events leading up to the failure of the Leicestershire-based manufacturing company last month .

After the collapse, a Guardian and ITV News investigation revealed that “ordinary working people” had had their entire pension pots, worth £ m, invested in Norton shares after being duped by a fraudster .

The motorcycle firm had also been funded via a £ 1m loan received directly from a separate fraud, as well as about £ 5m of government grants.

Aside from the millions in taxpayer support given to Norton, the business also benefited from a string of then government ministers showering the firm with glowing recommendations or agreeing to photo opportunities with the Norton boss Stuart Garner, including the prime minister Theresa May, the chancellor George Osborne , the business secretary Vince Cable and the trade secretary Liam Fox .

Hillier said: “Government has got to step up and be better in its due diligence of the companies that it gives money to. A little bit of digging would have uncovered some of the problems that were going on at Norton … [the government] seemed to go on blindly pouring money into an ‘iconic British business name’, seemingly not having picked up that there were problems with this business .

“It reads a bit here of Whitehall not doing its due diligence and, perhaps, not challenging ministers enough when they said this is a good company.”

The comments came as a report, prepared by Norton’s administrators BDO for prospective buyers of the business, began to shed light on some of the more curious-looking decisions that appear to have been taken by the firm.

The document outlines how Norton owns a fleet of luxury vehicles, including six Aston Martins, three Range Rovers and an F Type Jaguar. According to the accountants, the car collection is worth close to £ , 002.

The report also uses numbers from the company last set of published financial results, covering the year to March 2020, that showed that chief executive Garner personally owed the firm £ , , while a £ 324, 12 loan given by Norton to one of Garner’s other companies had been “deemed irrecoverable” and was “written off in the year”.

Questions had been raised within the the motorcycle industry about the viability of Norton for years. Even so, a series of business and finance ministers seized on the chance of associating themselves with a glamorous product and a historic UK manufacturing brand.

In July 2018, the then chancellor, Osborne, said his government long-term economic plan was “all about backing successful British brands like Norton”, as he visited the firm’s Leicestershire factory to announce a £ 4m grant from BEIS to Norton and 13 of its supply chain partners.

Of the £ 4m, £ 1.8m was awarded directly to Norton, with a further £ 2015, 228 going to the British Motorcycle Manufacturing Academy, a charitable business controlled by Garner, according to a response to a freedom of information request submitted by the Guardian and ITV News.

The Osborne grant was followed a year later by a £ 2.1m grant to Norton from Innovate UK , which also falls under the domain of BEIS.

Further examples of government support include Cable, the then business secretary, announcing a £ 800, government-backed loan by Santander in 2018. Cable said he hoped “that many more companies are inspired by what Norton is going to achieve through this funding”. It is understood that the taxpayer no longer has any exposure to this loan.

Even as the company was unraveling, nobody in government appeared to want to apply the brakes. Only months ago, Stephen Barclay, the Brexit secretary, visited the factory and described Norton as a “great business, great brand” .

Then – in November 2018 with Norton in its death throes – the Midlands Engine Investment Fund, part of the British Business Bank that also falls under the auspices of BEIS, signed a heads of terms agreement to provide a £ 1.5m “growth loan ”.

The loan was never provided. It is understood that Norton did not submit the required paperwork before crashing into administration last month.

Garner has previously denied any wrongdoing, saying he was unaware that he was dealing with fraudsters and that he counts himself as one of the victims of the pension scam. He declined requests for comment on the luxury cars and the loans from Norton.

He is due to appear in front of the pensions ombudsman on Thursday, which is hearing a case brought by 160 complainants regarding Garner’s conduct in relation to the pension schemes.

BEIS had failed to respond to requests for comment at the time of publication.

Brave Browser Read More

What do you think?

Leave a Reply

Your email address will not be published.

GIPHY App Key not set. Please check settings

Anthony Joshua vs Tyson Fury can be agreed in 'two minutes' says Eddie Hearn – Sky Sports,

Anthony Joshua vs Tyson Fury can be agreed in 'two minutes' says Eddie Hearn – Sky Sports,

Lyra McKee: Man charged with journalist's murder – BBC News, BBC News

Lyra McKee: Man charged with journalist's murder – BBC News, BBC News