The decision of the government to offer a taxpayer loan for just four weeks to LDV, with no extension, is a carefully chosen time period for the lending.
Four weeks from today takes us beyond the local and European elections, avoiding embarrassing headlines about the collapse of a vehicle maker when votes have to be garnered. The unwary in the media may even do the government’s bidding, and offer us “rescue” headlines, to show the government feels the motor industry’s pain, and is on board to help them.
We should instead be asking
1. Why don’t the nationalised banks lend money to LDV? Do they think it a bad prospect?
2. Why will the deal be done in another four weeks?
3. What happens if the deal is not done in four weeks?
4. What security have taxpayers got for their £5 million?
The good news is it’s only £5 million. If it had been a bank, then it would have been a different story – huge sums for unlimited time periods. What a pity none of this bank money has produced bank finance for a company the government thinks should and can be saved!