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Mandelson calls for Rover apology Mandelson calls for Rover apology
(40 minutes later)
Lord Mandelson has called for the businessmen who ran MG Rover prior to its 2005 collapse to apologise for taking so much money out of the firm.Lord Mandelson has called for the businessmen who ran MG Rover prior to its 2005 collapse to apologise for taking so much money out of the firm.
The business secretary said the so-called Phoenix Four, who bought Rover for £10 in 2000, had "feathered their own nests" during their time in charge.The business secretary said the so-called Phoenix Four, who bought Rover for £10 in 2000, had "feathered their own nests" during their time in charge.
A report found the men pocketed an "unreasonable" £42m in pay and perks.A report found the men pocketed an "unreasonable" £42m in pay and perks.
The Phoenix Four blame Labour for Rover's collapse but Lord Mandelson said ministers had been "faultless".The Phoenix Four blame Labour for Rover's collapse but Lord Mandelson said ministers had been "faultless".
'No humility''No humility'
And he rejected criticism that ministers had not done enough to try and save the firm, whose collapse cost more than 6,000 jobs.And he rejected criticism that ministers had not done enough to try and save the firm, whose collapse cost more than 6,000 jobs.
However, opposition parties criticised the government for allowing the group to take control of MG Rover in the first place.However, opposition parties criticised the government for allowing the group to take control of MG Rover in the first place.
Given all that has happened, I think they should reflect on what they have done, reflect on what they have said and give an apology Lord Mandelson It is regrettable that they did not investigate the possible misuse of taxpayers' money Kenneth Clarke, shadow business secretary
Lord Mandelson said the Phoenix group had not shown an "ounce of humility" about the firm's demise and that they owed an apology to the firm's employees and creditors.Lord Mandelson said the Phoenix group had not shown an "ounce of humility" about the firm's demise and that they owed an apology to the firm's employees and creditors.
"These people feathered their own nests and filled their own pockets full of a lot of cash during the course of their time as directors," he told the BBC."These people feathered their own nests and filled their own pockets full of a lot of cash during the course of their time as directors," he told the BBC.
"Given all that has happened, I think they should reflect on what they have done, reflect on what they have said and give an apology.""Given all that has happened, I think they should reflect on what they have done, reflect on what they have said and give an apology."
Lord Mandelson defended the government's role in smoothing the way for Phoenix to take control of Rover, saying the then Industry Secretary Stephen Byers could not have known how the men would behave once they took control of the business.Lord Mandelson defended the government's role in smoothing the way for Phoenix to take control of Rover, saying the then Industry Secretary Stephen Byers could not have known how the men would behave once they took control of the business.
"Stephen Byers was faultless is his efforts to save this company, these jobs and to secure the future production of this company."Stephen Byers was faultless is his efforts to save this company, these jobs and to secure the future production of this company.
"He did his level best, which is why he has received no criticism in this report.""He did his level best, which is why he has received no criticism in this report."
He also defended ministers' efforts to rescue the company in 2005 following criticism that it failed to stump up a loan to facilitate a deal with a prospective Chinese partner, saying Rover itself had decided not to proceed with talks on a deal.He also defended ministers' efforts to rescue the company in 2005 following criticism that it failed to stump up a loan to facilitate a deal with a prospective Chinese partner, saying Rover itself had decided not to proceed with talks on a deal.
"The reason there was no bridging loan was there was nothing to bridge to," he said."The reason there was no bridging loan was there was nothing to bridge to," he said.
"Simply to give the money, given what else we had given them in the first place, would have been illegal under EU law.""Simply to give the money, given what else we had given them in the first place, would have been illegal under EU law."
Responding to claims in the report that ministers had given "irresponsible" briefings during these negotiations, Lord Mandelson said this was an "observation" not a criticism.Responding to claims in the report that ministers had given "irresponsible" briefings during these negotiations, Lord Mandelson said this was an "observation" not a criticism.
'Terrible decision' 'Sorry episode'
Ministers have urged the Phoenix Four to voluntarily bar themselves from serving as directors of a company again rather than forcing the government to begin proceedings against them.Ministers have urged the Phoenix Four to voluntarily bar themselves from serving as directors of a company again rather than forcing the government to begin proceedings against them.
The four directors, Peter Beale, John Edwards, Nick Stephenson and John Towers, rejected the report's conclusions, saying the government should take responsibility for Rover's failure.The four directors, Peter Beale, John Edwards, Nick Stephenson and John Towers, rejected the report's conclusions, saying the government should take responsibility for Rover's failure.
"There is no explanation for the Longbridge workers why MG Rover collapsed," they said. "Our remuneration was not the reason for the collapse. The real reason is the government bungled the last chance to save MG Rover.""There is no explanation for the Longbridge workers why MG Rover collapsed," they said. "Our remuneration was not the reason for the collapse. The real reason is the government bungled the last chance to save MG Rover."
Shadow Business Secretary, Kenneth Clarke, for the Conservatives, said it was right that report criticised the Phoenix Four "who seem to have enriched themselves at a time when MG Rover workers were losing their jobs".
But he said the report does not "shed enough light on the government's undoubted involvement in brokering the deal in the first place and failing to realise that the project was heading for disaster".
"It is regrettable that they did not investigate the possible misuse of taxpayers' money, when ministers put in £6.5m in the middle of an election campaign, to keep the company going beyond polling day."
He added: "I can understand why Peter Mandelson was so reluctant for this report to come out because it reminds us of this whole sorry episode from which government ministers do not emerge with any credit."
The Lib Dems said the government must ensure a repeat of the Rover debacle never happened again.The Lib Dems said the government must ensure a repeat of the Rover debacle never happened again.
"It should not be forgotten that the government jumped at a £10 bid from an inexperienced consortium," John Thurso, the party's business spokesman said. The party is calling on ministers to ensure that the proceeds of remaining Rover assets frozen pending the report's publication should now be distributed among former workers.
"This turned out to be a terrible decision for all involved."
The party is pressing the government to ensure that the proceeds of remaining Rover assets frozen pending the report's publication should now be distributed among former workers.