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Wednesday 08 October 2008

Dear Sir

Socialism's big day - MG Rover

This was a very interesting article and one which I wholly agree with.

I've been saying for the last five years that the economy will go bust. No, I'm not a professional economist or accountant, merely an ordinary council worker in Lancashire. But the Government's grovelling and strategy of sucking up to the City and putting all its eggs in the Financial Services basket has been proved to be utter madness. The debt has to be paid at some point in time and the fragility of the greed-driven, un-principled rumour mill that we know as the Stock Exchange, simply had to crash - the values could not go on rising.

A further disastrous facet of the economic strategy adopted by the Blair/Brown partnership under New Labour, has been the inward capital from foreign organisations eager to get a foot into Europe through Britain, buying up established British companies. The effect of all this capital coming into London has steadily pushed up the value of Sterling on the international money markets, to such a level that manufacturers found it impossible to compete in foreign markets.

So far as MG Rover is concerned. The fact that we are still waiting for the government inquiry to publish its findings after nearly four years is more than a little suspicious. There have been continued allegations of a lack of interest or assistance from the DTI when the Joint Venture negotiations between the company and SAIC in China were taking place.

You may have the opinion that MG Rover produced out-dated cars and whilst I can not disagree that some were past their life span, this did not make them poor. In fact, warranty return figures proved that the build quality was quite exceptional for the price. The company also had a sound business plan and set out a strategy of acquiring a Joint Venture partner in China long before the Chinese market was taken seriously by a lot of the City institutions. Furthermore, new models had already been designed and pre-production tested and the vast workshops of Longbridge awaited re-tooling once the JV had been signed off. The fact that the DTI through incompetence and a strategy of 'manufacturing not being a priority of this Government' is what held up talks as SAIC could not get responses to queries. It was incompetence on a massive scale.

John Towers, the former Chairman and Chief Executive of MG Rover Group has already hired a media company to expose the failings of Government policy and of the DTI once the official enquiry is published, which he fears will be politically aimed at the management team. Don't forget that MG Rover did not want any taxpayers' money in the form of subsidies or bail-outs, unlike Northern Rock or the rest of the London-centric organisations that New Labour courts. It just wanted support in the form of underwriting the pension liabilities.

This government's policies on engineering and manufacturing are now being exposed and perhaps now people will believe that they have no substance.

Simon Robinson, Burnley, England

(original article: here )

hahagotcha