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UK

13/02/2020

The chair of parliament’s public accounts committee is calling for an investigation into the government’s funding of Norton Motorcycles which went into administration two weeks ago leaving customers out of pocket and pension-savers unable to access their money.

Meg Hillier MP accused officials of “blindly pouring” millions of pounds into the company before it went under and said she intended to write to the department for business, energy and industrial strategy (BEIS) and the Cabinet Office to ask for an enquiry into events leading up to the failure of the Leicestershire-based manufacturing company last month.

Going back to 2008, certain politicians lined up to support Norton owner Stuart Garner after he announced he was to revive the brand. George Osborne (pictured with Garner), Liam Fox and Stephen Barclay publicly endorsed Garner’s project, showering the company with praise and providing taxpayers’ money.

In February 2018 Theresa May took Stuart Garner on a Trade Mission to China.

The government made him an “Export Champion” and became one of the faces of an advertising campaign.

Following the collapse of Norton, ITV News and the Guardian revealed that 228 “ordinary working people” had their entire pension savings invested in Norton shares.

ITV News and the Guardian calculate that, since 2011, Norton Motorcycles has received more than £5 million of taxpayer support.

In July 2015, the then chancellor, George Osborne, visited the Norton factory and announced a grant of £4m from BEIS to the firm and 11 of its supply chain partners.

The Osborne grant was followed a year later by a £2.1m grant to Norton from Innovate UK, over which BEIS also has oversight.

In November last year, despite obvious signs that the business was short of cash, the Midlands Engine Investment Fund, part of the British Business Bank that also falls under the jurisdiction of BEIS signed a heads of terms agreement to provide a £1.5m loan.

Norton didn’t end up receiving any money and went into administration last month.

Meg Hillier MP told us: "I think there are really serious questions here.

"Obviously it's impossible for anybody to have known everything that was going on with this failing company and particularly the pension issues. But it does beg questions about why more of the taxpayers’ money was being put into a company that clearly had performance problems.”

Stuart Garner has always strenuously denied any wrong-doing. When Norton went into administration on 29 January he said he was “devastated” for everyone associated with the company.

Garner claimed he had “personally lost everything” and blamed the failure of company on “a growing tax burden and ongoing uncertainties over Brexit affecting many things like tariffs, exports and the availability of funding”.

Garner is appearing in front of the pensions’ ombudsmen today, which is hearing a case brought on behalf 30 pension savers.