GORDON Brown today pledged some government support for Jaguar Land Rover – as the bleak prospect of thousands more West Midland job losses loomed ever closer.
But the Prime Minister, on a visit to Birmingham, held back from announcing actual agreement on the details of any loan urgently needed by JLR to help it survive the credit crunch.
Downing Street’s backing for JLR came in a meeting in the city centre this morning with Birmingham Post editor Marc Reeves as more than 5,000 readers backed the newspaper’s campaign in support of a financial package for the company.
Mr Brown said: “We are determined to do what we can to help, but I don’t think we are in a position where we have been asked to put up a particular sum.
“This is part of a discussion we are having with the company. What we have been talking to Jaguar Land Rover about before Christmas and subsequently, is what we can do to help them through this difficult period.”
Mr Brown said the “first responsibility” for supporting JLR lay with its Indian owners, Tata, who are seeking a loan of up to £1 billion to be paid back over a period of 18 months or two years.
Meanwhile, sources close to the Prime Minister have indicated that a loan deal would almost certainly be agreed – and that the delays were due to complex negotiations between the Indian owners and the Government.
The source said: “It might sound simple to you but if you saw the immense detail and different nature of the financial puzzle on the Indian side you might realise why Treasury officials are currently still scratching their heads.
“In principle, Mr Brown and Lord Mandelson [Business Secretary] are nodding their heads, but the fact is that the due diligence is taking time and immense effort.”
Hopes of an early announcement of an agreement were also raised in a separate interview given by Lord Mandelson, who praised Tata’s commitment to JLR.
He said: “Jaguar Land Rover’s owners have put money in – they have sustained the company during this month.
“We are dealing with a parent company which is open, honest and with integrity. They have not asked for a bail-out and nor would they receive one.
“But some restructuring will be called for on the financial side of the company. That takes time to discuss with banks and other investors.
“The Government will continue to play a role in that in bringing people together and having discussions that need to take place.”
Despite the reassurances, political pressure for an agreement looks certain to intensify amid warnings from both JLR and unions that many more jobs are at risk from the economic downturn.
The number of e-signatures on the petition launched on Number 10’s website calling for government support for JLR grew to more than 5,000 this morning – just four days after it was launched.
? The Birmingham Post's ‘Support Jaguar Land Rover Now!’ campaign is also being run in the Birmingham Mail, the Coventry Telegraph, the Liverpool Daily Post and the Liverpool Echo, a unique media partnership aiming to persuade swift Government action.