§ 2.58 p.m.
§ Lord Dean of Beswick asked Her Majesty's Government:
§ Under what circumstances the chairman of the Residuary Body of Greater Manchester has assumed control as chairman of the G Mex Company in Manchester.
The Minister of State, Department of the Environment (The Earl of Caithness)My Lords, the chairman of the Greater Manchester Residuary Body was appointed chairman of Greater Manchester Property Trust Limited at a meeting of the board of that company on 29th April 1988. The company had been established by the Greater Manchester Council to safeguard the public sector's investment in the G Mex Development. Since abolition the company has ceased properly to represent the public interest. The residuary body took the view that it was necessary for it, in seeking to discharge its responsibilities, to secure control of this company.
§ Lord Dean of BeswickMy Lords, I am grateful to the Minister for that reply. I realise that in this case there is certain commercial sensitivity. The Minister will know that, nearly three years ago, I met the previous Secretary of State for the Environment with his ministerial team, including two Members of your Lordships' House. In complete confidence I expressed to them my fears as regards what might happen. In view of the Answer that the Minister gave, can he tell me whether it is in order for the chairman of a residuary body to become the chairman of a commercial trading company? Can the Minister tell me whether the appointment as chairman ceases when the residuary body itself ceases to exist, bearing in mind that as yet the 10 districts have no input into the situation?
The Earl of CaithnessMy Lords, as I understand, it is in order for the present situation to exist. I further understand that when the residuary body is wound up then the interest of the present chairman will finish because the residuary body will no longer have an interest in the company. I assure the noble Lord that we are also in touch with the districts on this matter.
§ Lord Dean of BeswickMy Lords, in view of the enormous debt that has been run up under the previous chairman in his dual role as chief executive—I do not wish to quote the figure because it has already been quoted in the Sunday Times—and because of the way in which this matter has been mishandled by that person, can the Minister give an undertaking that his services will not be retained in any position, either as an officer in the corporation or as a consultant, bearing in mind the whole debacle which the chairman of the residuary body is trying to resolve?
The Earl of CaithnessMy Lords, I cannot give that undertaking. As the noble Lord knows, following the board meeting, the previous chairman was no longer chairman but, as I understand it, remains a director.
§ Lord McIntosh of HaringeyMy Lords, in his reply the noble Earl said that the association was no longer in the public interest. Will he indicate to the House whether this change, so that it is no longer in the public interest, has resulted in any loss to the public purse?
The Earl of CaithnessMy Lords, the position is extremely complicated because not only is G Mex involved but there is at least one other property and one development site of 26 acres adjacent to G Mex. The residuary body is doing its best to protect the public interest and in my view is doing an extremely good job in reducing the liabilities. We hope therefore that it will be sorted out in the not too distant future.
§ Lord McIntosh of HaringeyMy Lords, when the noble Earl talks about reducing the liability, does he mean that there is some extra liability to the public purse as a result of this affair, even though it may be reduced by the actions taken?
The Earl of CaithnessMy Lords, as I understand it, not to the public purse. Certain liabilities were entered into by GMC and that is what is being sorted out at the moment.