Qinetiq Report Will Be Another Blow For The Treasury - Cable

2.36.00pm GMT Wed 21st Nov 2007

At Prime Minister's Questions today Acting Liberal Democrat Leader and Shadow Chancellor Vince Cable said that the recent disasters in the Treasury now show that it has become too powerful and is unfit for purpose.

He warned that the Treasury will face another blow this week when it is widely expected that the National Audit Office will criticise the Government over its privatisation of defence firm QinetiQ.

He said:

"Things are going from very bad to even worse in the Treasury. The privatisation of QinetiQ is yet another example of the callous disregard this Government has for public money.

"Not only was the firm sold off below its value but its chief civil servant made a total of £22 million.

"The financial naivety of the Government alongside a dogged desire to push through the sale of QinetiQ as quickly as possible has done nothing but benefit the private investor at the cost of the British tax payer."

Notes

· 37.5% of QinetiQ was sold to the Carlyle Group in 2003; the business was subsequently floated on the stock exchange in 2006

· The Carlyle Group sold its stake in QinetiQ in 2006 for a profit of £300m from its original investment of £42m in 2003.

· Sir John Chisholm, Chairman of QinetiQ, received a return of £22m from his original £129,000 investment.

· The National Audit Office will release its report on the privatisation of QinetiQ on Friday.