A VITAL £2.3bn government aid scheme for the ailing car industry has failed to pay out a single penny in three months, it was revealed yesterday.
Crisis-hit firms and trade unions are “angry and frustrated” at the failure to deliver the Automotive Assistance Programme (AAP), an inquiry by the Commons business committee was told.
The scheme was launched in a blaze of publicity on March 11, with ministers confidently predicting more than 100 car-makers and supply-chain companies would be helped.
But, three months on, just four applications are “close to full appraisal” – and there is no predicted date for paying out the first loan.
The AAP pledged £2.3bn to unlock £1.3bn of loans from the European Investment Bank (EIB) for investment in “greener” vehicles, with a further £1bn of government loans available.
One of the four applications was made by Jaguar Land Rover, which employs 2,000 people at its Halewood plant and a further 13,000 in the West Midlands.
It was already known a £340m loan for JLR to develop “clean cars” has not been paid out – despite being approved by the EIB in April – because of rows over restructuring the company.
The Government is thought to have demanded the right to appoint a new chairman, a guarantee of no further redundancies and a pledge by owner Tata to inject further cash into JLR.
