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Last Updated: Saturday, 9 April, 2005, 17:28 GMT 18:28 UK
More cash pledged for Rover firms
Workers at Longbridge
A task force has been set up to help solve the crisis
The government is prepared to give more money on top of the 40m already pledged to help firms hit by the MG Rover crisis, the chancellor has said.

Gordon Brown also indicated that claims bosses made millions from the car maker might be part of a future inquiry.

The Tories have backed the inquiry idea while the Lib Dems have accused Labour of acting too late to help Rover.

Administrators appointed to run Rover are examining the books to see if jobs and parts of the firm can be rescued.

Mr Brown's comments were made in Edinburgh during a day of low-key general election campaigning while the main party leaders attended the royal wedding celebrations.

It is the job of government to be on the side of people as they face difficult situations
Chancellor Gordon Brown

The government has already announced a 40m support package for suppliers to the industry.

Mr Brown said the government would "continue to do everything in our power" to help the Longbridge-based firm and companies which supplied its factory.

"We have already made some money available to help the supply companies and we will announce more in the next few days if it becomes necessary."

'Early days'

The profits made by the Phoenix consortium from the Rover deal are also in the spotlight.

There are no claims of illegal practices but trade unions complained in 2003 about a 12.6m pension fund set up for executives.

Mr Brown said: "There will obviously be inquiries into what has happened in Rover since the deal with BMW.

"But at the moment we have to look at what we can do to help the existing jobs, the existing manufacturing work, and the existing skills."

Everybody's working incredibly hard... to try and get a successful outcome from this
Price Waterhouse Coopers

Conservative shadow chancellor Oliver Letwin agreed that an inquiry was needed, saying: "The thousands of people working at Rover and the thousands more - including suppliers and pensioners - dependent on Rover will be demanding answers."

Mr Letwin asked why the four Phoenix partners seemed to have benefited by millions of pounds when the company had made no profit.

Liberal Democrat spokesman Malcolm Bruce called the case an "appalling example of bad corporate governance".

"There are important questions not only over corporate governance but also over why the government did not do more five years ago to help Rover to find itself a partner company then," he said.

Administration talks

MG Rover will soon enter administration after rescue talks with China's Shanghai Automotive Industry Corp (SAIC) collapsed.

Accountants Price Waterhouse Coopers (PWC) say they are optimistic about trying to salvage parts of the firm, because of "good assets and a great workforce".

PWC partner Ian Powell said "some pretty crucial discussions" would take place over the weekend with prospective funders and the government.

But everybody was working incredibly hard and it was right to be optimistic, he added.

After an emergency meeting on Friday, Prime Minister Tony Blair said the original deal could not be salvaged.

But the government would seek another way of maintaining production and protecting as many jobs as possible.

Task force

The Birmingham Chamber of Commerce says it is very confident the 6,000 Rover staff could find new jobs.

Birmingham City Council has set up a helpline for those affected by the crisis - the freephone number is 0800 073 0440.

Rover's workers have been told to turn up for work on Monday.

A TGWU spokeswoman said the union's hopes "now lie with the administrators".





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The possible outcome for Rover employees



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