New BMW charges put angry Byers on the rack
THE political future of Stephen Byers was thrown into further doubt last night after the chairman of BMW claimed he had warned the trade secretary last year that he might have to sell Rover. In his first interview since the crisis blew up, Joachim Milberg said he told Byers in December that Rover was in "serious trouble" and that a sell-off might have to be considered. He said Byers seemed to take the news calmly and was "unmoved". Byers, who has been angered by BMW's claims, has repeatedly said the company gave no advance warning of its announcement last month, when executives declared they were selling their Rover subsidiary to Alchemy, a venture capital group, threatening thousands of jobs in the west Midlands. Byers faces a grilling about his claims of ignorance when he appears before the cross-party trade select committee on Wednesday. Critics say he should have scented BMW's planned sale of Rover and taken steps to prevent it; the publication today of the interview with the BMW chairman gives fresh support to their claims. Asked when he first came to suspect that BMW might not be able to stick with Rover, Milberg replied: "By the end of November, beginning of December, I was extremely doubtful. Later, around the 20th, I called Byers and told him that Rover was in critical survival mode - in serious trouble." The contents of that call, made on December 22, are disputed by the Department of Trade and Industry (DTI) and will be a focus of this week's cross-examination of Byers by the Commons committee. BMW insists it was made clear that Longbridge as a whole was under threat. The DTI claims only one aspect - the production of the proposed R30 car at the plant, on which a £152m government grant depended - was discussed. The BMW chairman says his warning went unheeded. "The situation did not get any better after this phone call," he said. "The British government did little to help the situation. "I also called Byers again in early January and gave him as clear a signal as I could that possible alternative strategies for Rover were on the table." Milberg also said: "The government, as well as the unions, should have known - how could they not have known - the true situation of Rover cars. We had given them regular figures of what was happening that left them in no doubt we were in a critical situation and had to find a solution. If we kept on, we would have damaged BMW." After the Rover sale had been announced, Tony Blair spoke to Milberg by phone. Milberg recalled the conversation: "Blair's attitudes and opinions seem to be many and varied. I have heard him say different things . . . to attack BMW over this particular commercial decision surprised me. "Blair expressed his sorrow to me that the British government was not informed beforehand. I replied quite firmly that I begged to differ on this point and told him the British had known all along." Byers's critics fear that he has failed to put up enough of a fight against the threat to Rover, and Milberg said the trade secretary had seemed unmoved by the company's fate: "It was not my impression on the phone with him that the minister was angry. I could not really judge his reaction [to news of the sale] because he seemed quite calm." That claim is likely to anger Byers's critics in government and in the union movement. Organisers claimed that as many as 80,000 people marched in Birmingham yesterday to protest over BMW's sale of Rover. Others claimed it was only half that number. The marchers heard impassioned speeches from union leaders, one of whom said afterwards in private that confidence in the trade secretary was waning: "If Byers is to remain it can only be with a really good number two sent into the department, someone who understands industry." Byers has repeatedly claimed that he knew from conversations with BMW and Rover executives that there was a possible threat to some Rover jobs.But he says nobody at BMW ever raised the possibility of a sale and that Werner Samann, the head of Rover, lied to him at a meeting on March 10, a week before the sale was announced. BMW says Samann told Byers: "The clock stands at five to 12. No company can go on with these losses." A source close to Byers denied yesterday that there had been a telephone conversation between him and Milberg in January. "Milberg has no notes of the conversations that did take place," he said. "We have a full civil service note of the crucial conversations, which will vindicate the trade secretary." Byers is to make civil service minutes of his conversations with BMW and Rover executives available to the trade select committee. Up to 100 engineers who agreed to move to Germany to design new models are being sent back to Britain this week, it emerged yesterday. They were seconded to Munich from the Rover design centre in Warwickshire on postings of up to two years. Many have let their homes and will have nowhere to live when they return.
Written By: Michael Woodhead and Michael Prescott
Article Date: Apr 02, 2000
Article Date: Apr 02, 2000