IN the wake of the collapse of Norton Motorcycles, the chair of the public accounts committee is pushing for an investigation into the government’s funding of Norton Motorcycles.
Officials are calling for the inquiry after millions of pounds of taxpayers’ money was “blindly pouring” into the Leicester-based business.
Norton has received around £5m in government grants in recent years, with another £1m being received from a dubious pensions scheme that saw saver's money used to help float the business.
As well as the money Norton received from the government coffers, MPs also helped to push the profile of the company, with then Chancellor, George Osbourne, joining Garner for a photo opportunity in 2015.
That PR exercise was to celebrate £4m of government funding which was claimed to be to support 600 new jobs which included 200 new apprenticeships.
Now, Meg Hillier MP, elected Chair of the Public Accounts Committee, is to write to the department for business, energy and industrial strategies (BEIS), to request an inquiry into the events prior to the Norton collapse.
The Guardian reports that 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.”
Meg Hillier’s letter comes in the wake of a report from BDO, Norton’s administrators, claiming that the motorcycle manufacturer owns a fleet of high-value vehicles, including a six Aston Martins, a Jaguar F-Type sports car and three Range Rovers. It’s reported that the fleets of luxury cars are valued at nearly £800,000.
BDO’s report also shines a light on some of the numbers the firm submitted outlining financials up to March 2018. These show that Garner personally owed the firm £160,000, while a £324,002 loan given by Norton to one of Garner’s other companies had been “deemed irrecoverable” and was “written off in the year”.
The Guardian also reports that a BEIS spokesperson said: “All Government funding awarded to the company was based on the usual processes of assessment and due diligence. At the time these awards were made, our due diligence did not indicate that the business was failing.”
