A VITAL £270m lifeline thrown to Vauxhall’s Ellesmere Port plant is one of the latest Labour spending decisions thrown into jeopardy by the new coalition government.
A Treasury review of all spending commitments made in the run-up to the general election will include the loan guarantee given to General Motors Europe by Lord Mandelson, in March.
Last night, Andrew Miller, the Ellesmere Port and Neston MP, warned that a U-turn, in what will be a savage spending squeeze starting next week, would inflict “huge damage” on manufacturing across the region.
The Daily Post also understands that GM has already contacted the Treasury to stress the loan is vital to its recovery plans.
When Lord Mandelson, as Business Secretary, announced the loan guarantee, it was hailed as safeguarding thousands of jobs at Ellesmere Port and in the 400 companies in Vauxhall’s supply chain.
But, on Monday, the new Lib-Dem Treasury chief secretary, David Laws, announced he was reviewing all “poison pill” spending commitments made by Labour in its dying days. Other car loans made to Ford (£379m) and Nissan (£20m) will also be reviewed, to assess if they represent value for money and are consistent with the new Government's aims.
