Government offers Rover £6.5 million
Jobs at Rover are safe for a week after the Government offered a £6.5 million loan to cover the plant’s overheads – including wages – for a week.
Trade and Industry Secretary Patricia Hewitt said that the loan was designed to protect jobs whilst negotiations on Rover’s future were ongoing.
MG Rover was put into administration last week after talks with the Shanghai Automotive Industry Corporation (SAIC) collapsed, threatening the livelihoods of some 6,000 workers at the Longbridge factory in Birmingham and 20,000 workers employed by its suppliers.
The loan has been set aside to pay for wages and expenses over the next week so as to keep the company going as talks continue to resurrect a deal.
A £40 million support package for suppliers to the industry has already been announced by the Government.
Ms Hewitt said the Government agreed to the funds “to avoid the issuing of redundancy notices at MG Rover while efforts are made to keep the business together”.
She said the Government would “monitor the situation closely” in the coming days and “review the adequacy of funds available while there is a realistic prospect of re-engagement with SAIC”.
The Government was doing everything possible to keep jobs and the future of manufacturing at Longbridge, she added.
Workers at the plant will attend a mass meeting on Monday to hear what is being done to save their jobs.
Administrators PricewaterhouseCoopers (PWC) is combing MG Rovers’ books to see whether the firm can be salvaged or whether it will be broken up and sold off to repay creditors.
It is also assessing claims of a £400 million “black hole” in the pension plan.
