About 4,000 MG Rover workers who lost their jobs after the carmaker went into administration have received redundancy payments averaging £5,000 each.
The £20m-plus payout, which will ultimately be paid by the taxpayer, was speeded up by officials, Patricia Hewitt announced while campaigning for the general election in the West Midlands yesterday.
The trade and industry secretary said the total payments to former Rover workers would be closer to £50m than the £40m she had announced when the company collapsed last month.
Former workers at the Longbridge plant in Birmingham, where more than 5,000 jobs were lost, had complained they would receive payments up to £3,300. But the trade and industry secretary said the actual statutory redundancy payouts were larger. Speaking in the marginal constituency of Redditch, she said: ‘I am delighted that my officials have put in a great deal of extra overtime and have made these payments in two weeks compared with the six weeks it can take to come through.’
The money is part of a £150m package pledged by the government to help the estimated 20,000 workers who have lost jobs at MG Rover and its suppliers.
The Transport and General Workers’ Union said:
‘It’s excellent that the government has moved very fast. But it’s awful that people with years of service have been left with the statutory minimum.’
The union also called for a quick settlement for the workers who were not paid their statutory 90-
day notice period because of the speed of the redundancies.
Ms Hewitt said administrators had received a ‘large number’ of expressions of interest from companies contemplating acquiring assets or divisions of Rover, but it was uncertain whether they would save any jobs.

About 1,250 out of more than 5,000 workers who lost jobs when MG Rover collapsed in April have found new employment. A government-appointed taskforce said it was evidence that ‘the West Midlands is fighting back from the biggest company closure in years’.
MG Rover, the last British-owned volume carmaker, went into administration after Shanghai Automotive Industry Corporation pulled out of collaboration talks. Yesterday’s news on employment suggests the blow to the local economy will be lighter than many predicted. This reflects a tight labour market and diversification by suppliers after BMW sold Rover to local industrialists in 2000.
The MG Rover Taskforce, which updated the Prime Minister on its progress yesterday, said 2,200 MG Rover workers had signed up for training courses.
About 1,000 have already started retraining. A few hundred MG Rover staff have been retained by the administrators to look after the Longbridge factory site, leaving about 1,000 other workers still looking for jobs or pondering their futures. The administrators have set today as the deadline for bidders to lodge their offers for MG Rover businesses Tony Blair praised the taskforce, whose efforts could become a model for dealing with future mass redundancies, alongside such examples as the regeneration of Corby after steelworks closures. The body’s task has been made easier by generous funding.
The Labour government, which was seeking reelection when MG Rover collapsed, has pledged £175m and the EU has put up £40m. That totals almost £36,000 per worker, though much of that money has not yet been spent..............

Before answering these questions read all three articles from the Financial Times.

Questions
1. Outline the organisational downsizing strategy that was adopted by Rover.
2. Outline the range of support offered to redundant Rover workers.
Why do you believe this support was offered?
3. Why did the UK government become involved in the downsizing at Rover?
4. What were the intended and unintended outcomes of the downsizing strategy adopted?