A deal to transform the TT into a viable commercial prospect saw government fork out a whopping £1.6 million to a private firm.

Despite the size of the lucrative deal, it has emerged no contract was ever signed and that £100,000 in expenses was paid over 23 months to the company, even though it was only ever supposed to receive a maximum of £15,000 a year.

Tynwald’s powerful Public Accounts Committee heard evidence this week from key players in the deal between the then Department of Tourism and Leisure and Signature Sponsorship Ltd.

Former chief executive Carol Glover and former Tourism Minister David Cretney MHK gave evidence together and were followed by former tourism director Geoff Le Page.

In often highly charged testimony, Mrs Glover explained the situation had to be understood in the context of the TT’s status in 2005, when negotiations with Signature first began.

Both she and Mr Cretney described an event in dire straits as a result of serious safety concerns raised in the wake of the high profile deaths of nine-times winner David Jefferies in a 2003 practice session and of rider Gus Scott and marshal April Bolster during the 2005 Senior TT. The two incidents threw the event into the spotlight, with critical comments made during inquests and a massive fallout both among the motorcycle industry and the media. During 2005, said Mrs Glover, 1,000 negative articles were written about the TT.

The task at hand was to ensure the event’s future viability.

‘The Minister and I had a really tough time in 2005,’ said Mrs Glover. ‘I had no knowledge of how serious the threats were because I was new and he was absolutely determined we were going to get through them.’

Mr Cretney called the period from TT 2003 to 2005 ‘by far the most difficult’ he had experienced since his appointment as minister in 1996.

Mrs Glover said companies did not want to touch the TT and that when she found Signature, a company with a great reputation for high level hospitality and brand management, she believed the match was right.

PAC chairman Alfred Cannan MHK explained Signature were appointed in January 2006 and worked on the event until mid-2009. Although the company’s work was considered to have been of a good standard, it was decided the deal was ‘overly generous’ and ties were cut.

When government was restructured in 2010, the newly formed Department of Economic Development became responsible for the TT and inherited a £750,000 liability to Signature, despite the fact the deal had expired. At that point, the company had already been paid £900,000.

The deal with Signature saw the company paid a basic £70,000 a year, plus £15,000 in expenses, and on top of that a 22.5 per cent commission deal was agreed.

When questioned whether this percentage was overly high, Mrs Glover said she did not believe so and that, once again, it had to be seen in the context of an event perceived to be struggling. She said a similar commission deal brokered now, when the event was so commercially strong, would be more likely in the single figures. She said: ‘We have been victims of our own success.’

Turning to the £750,000 figure, Mrs Glover said that liability had come about because of the television rights to the TT, which had raised the event’s stock. She said she had left the department before the TV deal was negotiated and that, if she had still been there, she would have renegotiated the original deal with Signature to take the new circumstances into account.

Mrs Glover admitted she had not gone through the tendering process when putting the Signature deal together but said this had happened in a time-pressed environment, when the pressure was on to ensure there would be a successful TT Centenary event in 2007 and a future for the races. She said throughout she had sought the counsel of the chief internal auditor and others in government.

Mrs Glover admitted inquiries made with other companies were not made seriously as she believed Signature were the right people for the job.

In his testimony, Mr Cretney too said he believed Signature were the right people for the job. He also fully backed Mrs Glover.

Referring to the £100,000 of expenses paid to Signature, Mrs Glover said it was the job of Mr Le Page to oversee this and the contract negotiations. These negotiations led to a total of 50 different versions of the contract and 150 revisions.

When asked about concerns raised by the Attorney General’s chambers about the contract, which remained unsigned, Mrs Glover said she believed it was the AG’s chambers that held up the signing of the contract.

‘If you ask me what I would’ve done differently I wouldn’t have employed the Attorney General’s Chambers,’ said Mrs Glover. ‘I would have employed a red hot contractual lawyer. I hated the situation we had with that contract.’

This version of events was not corroborated by Mr Le Page, however, who said most of the changes to the contract came because of government and said he believed Mrs Glover made ‘changes for changes’ sake’ when he believed the contract was ready to be signed on a few occasions. Mr Le Page said although he had been tasked with overseeing the contract, he ended up as a ‘messenger boy’ acting as a go-between when the DTL or Treasury wanted to make changes. This happened so much he stepped away from dealing with the contract.

He admitted relations with Mrs Glover were strained although he said they tried to act professionally about it.

Regarding overpayment of expenses, Mr Le Page said he did not believe the system he was working with was adequate in that it made him, as manager, both ‘poacher and gamekeeper’. In an effort to deal with this, he asked members of the Motorsport Development Team to oversee the expense claims, which still ultimately crossed his desk to be signed off. He could offer no explanation as to the overspend, he said.

Towards the end of the sitting, Mr Cannan attempted to sum up his assessment of the evidence he had heard throughout the morning by saying to Mr Le Page it was perhaps Mrs Glover’s ‘force of personality and determination’ to ensure the success of the TT and her ‘lack of trust’ in her officers that led to a lack of control over the contract and a breakdown in communications with Signature.

Mr Le Page said he agreed with certain elements of what Mr Cannan had said, adding he shared the determination to get the job done but not at the cost of government procedures.

In his testimony to the committee, Mr Cretney said he was sorry the contract issue had not been resolved before the 2006 General Election, when he moved on from the department. It meant the new minister, Adrian Earnshaw, inherited the problem and in the end refused to sign the contract.

He admitted £1.6 million was a lot of money to have spent with Signature but added: ‘The event is in a lot better place than when we started.’



By Angela Gregory
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Typical
It wasnt me it was her-him
No its wasnt me it was them
£1.6m and no one accountable
£30k and they are up in arms for the MGP

Dave

Dave, were this thing have happened here in the U.S. we would of recognized the MGP fuss as a coverup for the TT spending waste... Ooops... perhaps it is..!

Ron..

And whose hands is the future of the TT in ??

(06-11-2012, 05:53 PM)pat slinn Wrote: And whose hands is the future of the TT in ??

Aha Pat that would depend on a couple of things, if it was successfull using DED data it would be the DED, if it was successfull using any other data it would be Paul Philips and the DED, if it was unsuccessfull using anyones data it was never in the sole hands of the DED but it was down to him-her-that person over there-the manx cat-the SPCC-in fact anyone else except the DED and Paul Philips.

Its really extraodinary on the Island..HoK and the DED (in its previous incarnation or whatever they want to call it) are not responsible for getting a £1.6m contract signed off, expenses are overspent to no ones responsibility, money wasted hand over fist without any control and who answers those up in arms, nobody. Government departments holding their hands up or putting heads in stocks. Yet YET the Grand Prix loses a reported £30k and all hell breaks loose, DED pointing fingers and appointing blame. Only on the Island.

Dave