Friday, 12 November 2010

Sheffield Labour MPs demand an investigation into the Proposed AugustaWestland Loan

Sheffield Labour MPs have today (12th Nov 2010) called on the Business Select Committee to investigate the proposed loan to AugustaWestland.  Repeatedly, the MPs have been told the loan to Forgemasters was cancelled because it was unaffordable, now they have found out the department has found £32million for a loan to Augusta Westland

They are calling on the committee to include this loan in the investigation it is currently carrrying out into the cancelled loan to Forgemasters.
Clive Betts MP for Sheffield South East said,

“The whole issue of the loan for Sheffield Forgemasters has been beset by constantly changing explanations from Government for the reason for withdrawal, it is now time for the Government to come clean. If lack of affordability was the final explanation for terminating the Forgemasters loan how can the money suddenly be found for assistance to another company only a few weeks later”

Commenting , Angela Smith MP for Penistone & Stocksbridge said,

While I welcome this investment in the UK’s manufacturing base, serious questions need to be asked as to how the government has now managed to find £32million when they have repeatedly claimed that the investment in Forgemasters is unaffordable. 
The rationale behind this loan to Augusta Westland needs to be examined and the investigation the select committee is already carrying out into the cancelled Forgemasters loan is the place that should be done.  BIS cannot say the Forgemasters loan is unaffordable and then authorise a loan to another company. There is either money available or there isn’t.

David Blunkett, MP for Sheffield Brightside and Hillsborough, said:

“There may be absolutely nothing untoward about the way in which the Augusta Wetland application was handled, but the contrast with the clear politicisation and confusion from senior government ministers of the refusal of the Forgemasters loan requires true transparency if we are to be able to trust coalition ministers with any major industrial investment decisions for the future.”

Even more worrying is the fact that the former Chief Secretary to the Treasury, David Laws, is the MP for Yeovil, which is where the Augusta Westland factory is located. It is known from parliamentary questions he lobbied for the loan; it is unclear however how much influence he had over the approval of the loan during his time as Chief Secretary.
The MPs have now written to both the BIS select committee to ask for an investigation and also to the Secretary of State for BIS asking why this loan has been approved when he cancelled the loan to Forgemasters on affordability grounds.

They are also seeking clarification of the first point at which Augusta Westland applied for a loan, whether they approached their local Member of Parliament at that time (and if not when such an approach was made), and what due diligence was undertaken by the Department before approving the loan.