David Bailey, motor industry expert and professor at Coventry University Business School, looks at the report for the Department of Business on the MG Rover collapse.
Four bosses running MG Rover awarded themselves “unreasonably large” payouts, the long-awaited Department of Business report said last week.
The car firm went bust back in 2005 owing £1.3 billion, with the loss of 6,300 jobs directly and
more in the supply chain.
The pay and pensions of five directors (including the infamous Phoenix Four) totalled £42 million yet the risks they took were ‘relatively unsubstantial’.
The report contains surprisingly little criticism of the Government, and focuses its fire on the greed of the directors in excruciating detail.
The report also found the Government couldn’t be blamed for the collapse of the talks in 2005 between MG Rover and Shanghai, as the latter had lost interest in Rover.
While the British Government “seriously” considered offering a £100 million bridging loan to facilitate the deal, it rightly decided there was little realistic prospect of it ever being repaid.
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