The European Union performed a U-turn over the closure of Peugeot's plant in Coventry yesterday, when it announced it was investigating claims that British taxpayers subsidised the transfer of jobs to Slovakia.
The European Commission has asked the Slovakian Government to provide details of aid going into the Trnava factory in Slovakia, where Peugeot is building the new 207.
As reported in The Birmingham Post, the decision not to build the vehicle at the Ryton plant in Coventry, where the ageing 206 is being phased out, contributed to the loss 2,300 jobs.
EU Competition Commissioner Neelie Kroes revealed she had written to the Slovakian authorities.
State aid granted to Peugeot could be a breach of EU regulations, as the Slovakian Government had made no request for approval from the Commission.
If aid was granted, it is also likely to have come from EU regional funds, which are distributed to encourage economic development in the poorest parts of the community.
Britain is a net contributor to the funds, and West Midland MEP Mike Nattrass believes British taxpayers have effectively subsidised the export of British car workers' jobs.
Mr Nattrass, a UK Independence Party MEP, claimed Trnava received #73 million in state aid, 15 per cent of the total budget.
In contrast it took two years for a #15 million aid application for Ryton to be approved, by which time Peugeot had lost interest.
The claim was denied last month by the European Commission, which said there were "strict rules" to ensure state aid was not granted without approval.
However, Ms Kroes yesterday confirmed she was investigating the claims in a hearing of the European Parliament's Internal Market and Consumer Protection Committee, when she was quizzed by West Midland MEP Malcolm Harbour (Con).
She had written to the Slovakian authorities in response to reports that substantial aid had been granted, she explained.
Mr Nattrass said: "Money that went in to the site would have been money given to Slovakia to grow the economy, which comes from countries such as Britain."
He has asked a number of questions to the European Commission about state aid anomalies, but has yet to receive replies, he added.
Mr Harbour said: "If any illegal state aid pledge has been handed over, we will demand that the Commission carries out a full investigation and forces Peugeot to repay all amounts above the permitted level.
"The European internal market rules are there to protect consumers, citizens and businesses from unfair subsidies that distort markets and cost jobs."
Des Quinn, of the Transport and General Workers' Union, said the union had asked Peugeot whether it received state aid as part of a series of questions aimed at under-standing the decision to quit Coventry.
An EU spokesman insisted: "The Commissioner said she has written to the Slovakian authorities. However, no funding has been given to Peugeot in Slovakia by the EU."
The Ryton car workers will be taking their case back to the streets of Coventry tomorrow as they begin a weekend of demonstrations to overturn Peugeot's threat to close their plant.