Wednesday, July 13, 2005

Has Teflon Whitby come unstuck?

Leader of Birmingham City Council, Mike Whitby, has a top of the range MG SV sports car - prices start at over £60,000 - on loan from Rover. This loan came about because Mike was altruistically

'negotiating a heavy discount for employees of the city of Birmingham so they could buy cars from MG Rover to stave off receivership'
which is an intriguing story, as Virgin pulled out of a deal with Rover some months ago because Rover wouldn't offer a 30% volume discount - quite a reasonable figure in the car market.

Mike then volunteered to act as an ambassador for the marque, having expressed an interest in these exclusive sports cars, and ended up driving one away on loan. He's been such a successful ambassador that MG only sold ten of these cars in total and the entire project ended up costing the company millions for no real return. Perhaps his marketing failure is down to only driving it twice and leaving it parked on a neighbour's drive because his own drive has a skip parked on it at the moment. PWC say that

'We have decided to continue the arrangement because it is promoting the profile of the company.'
PWC clearly have no idea about marketing or 'promoting the profile' - unless they want to be associated with second-rate politicians.

Let us pause for a moment and consider the Birmingham City Council code of conduct for members and what it has to say on gifts - article 17:

A member must within 28 days of receiving any gift or hospitality over the value of £25, provide written notification to the authority's Monitoring Officer [currently the Chief Legal Officer] of the existence and nature of that gift or hospitality
I think that the loan of a £60,000 car counts, don't you? He certainly had a duty to report it, as the Standards Board for England makes clear that they should be reported if they are received in connection with your official duties as a member. As Mike admits, the loan came about because he was negotiating a deal for council employees - and it would take a leap of faith to suppose that MG would loan him a vehicle if he weren't the Leader of the City Council. Mike was also on the Rover Task Force as a representative of the council - although the car loan is obviously irrelevant to that as Rover would have been an issue regardless.

So, what would a reasonable person think of this deal?

1 comment:

Bob Piper said...

You were in fine form with this series of postings, comrade. Very impressive stuff.