LDV workers in Birmingham pin hopes on government

Mar 20 2009 by Jon Griffin, Birmingham Mail

AROUND 7,000 workers were today pinning their hopes on a Government about-turn over a £600,000 tax bill which could tip Birmingham-based LDV over the edge into administration.

Bosses at the van-making plant were waiting to hear whether Revenue and Customs had agreed to accept deferred payment over the National Insurance demand.

The deadline for payment to the taxman was due to expire today – with a £600,000 debt still the subject of crucial negotiations between LDV and tax officials.

LDV has already warned that the National Insurance demand could tip the firm over the precipice – plunging the future of 850 direct employees and around 6,000 more in the supply chain into jeopardy.

LDV PR and Marketing Director Guy Jones said: “We have requested the Government’s help in deferring payment and they have already deferred some. The actual sum due this week is close to £600,000 and we want them to defer that as well for the moment.”

If the £600,000 demand is not deferred, Customs and Excise could bring a winding-up order against the van maker, potentially hastening a collapse into administration.

But LDV bosses hoping to push through a management buyout from Russian owners GAZ are still hoping that the Government can stump up around £5 million to help prop up the funding package for the MBO.

The Mail revealed yesterday that the van-maker had around £5 million worth of orders in the pipeline for 250 specialist vans, with the vast majority for Postman Pat-style post offices wanted by the Government.

But the factory cannot meet the orders because production remains at a standstill at Washwood Heath while LDV pleads for Government support for the MBO.