LG - The white elephant of Newport

First up we have this:
http://www.newswales.co.uk/index.php?section=Business&F=1&id=9236

Investigation by local AM Michael German has uncovered that £247.2 million was paid to the firm LG by Welsh public bodies to attract the company to Newport in 1997. Welsh Liberal Democrat Assembly Leader Mr German made the enquiries following the closure of the LG Electronics plant earlier this month, with the loss of the final 315 jobs. Mr German said: "It turns out that almost £250 million was paid to attract a company to Newport to create jobs. This company barely stayed for ten years. Newport needs long-term investment in companies that will create prosperity and be rooted to the area.
This was not a value-for money investment. "I will be calling on the Enterprise Minister Andrew Davies to disclose publicly the full set of accounts detailing which public bodies provided support to LG. "It worries me that so much money was paid to a firm which has left us with nothing but redundancies. The Welsh Assembly Government needs to make it harder for companies to take the money and run. "Effectively, this means that Welsh public bodies paid LG around £25 million a year to stay in Newport.
This cannot be the best way to invest in South East Wales." Welsh Liberal Democrat Economic Development spokesperson Kirsty Williams said: "LG is a textbook example of inward investment that failed to live up to the hype and I hope that the Welsh Assembly Government will learn from these mistakes.
I want to see investment in companies that will stay in Wales as well as more transparency about how public money is spent to attract business. "This sum of money could have been better invested in transport infrastructure across South Wales East, such as the rail link to Ebbw Vale, and there would still have been enough funding to create hundreds of long term jobs in Newport."

Next up this from the BBC on costs:
http://news.bbc.co.uk/1/hi/wales/south_east/4155264.stm

In order to attract the investment to Wales, Welsh public bodies offered an aid package worth £247m.
A total of £131m was eventually paid out to the LG companies but the projects were never completed as planned and fewer than half of the planned jobs were ever created.
At the announcement of the closure of the final LG factory on the site last year, the company blamed falling prices and rising costs of producing computer monitors.
£71m was recovered from the LG companies by Welsh public bodies.
A series of recommendations for future projects have been made which includes proper assessments and risk management.
It also recommended that legal agreement for major projects to include a series of interim milestones for clear assessments of the progress of the project.
Chair of the audit committee, David Melding AM said: "We found the Welsh authorities did very well in recovering as much money as they could but there were mistakes with the project appraisal which meant unnecessary risk.
"This is clearly unacceptable and lessons must be learned for the future."

So lets recap:
http://icwales.icnetwork.co.uk/news/wales-news/2007/11/07/lg-project-risks-millions-91466-20071443/

A total of £131m was eventually paid but less than half the jobs were created. At its peak, LG Electronics provided 2,200 jobs but its cathode ray tube plant closed in 2003 and its monitor assembly facility closed in 2006. A semiconductor project was never completed.
A total of £71m in the form of cash and property was recovered but the LG companies were able to retain £60m in recognition of the jobs created during the time of operation and the lasting economic value of the infrastructure created at the 350-acre Imperial Park site, located off Junction 28 of the M4 motorway.

**So 60 million quid of public money has been pissed away. LG came, stayed a short time and trousered 60 million quid. Nice work if you can get it.

But at least someone is moving into the old site:
http://news.bbc.co.uk/1/hi/wales/south_east/4155264.stm

A total of 460 jobs are to be created in Newport after an Irish firm bought the former LG Philips building from the Welsh Assembly Government.
The Quinn Group, which makes radiators, has announced a £133m investment to set up its European base, which will include research and development.
The plant will be expanded and in full production within three years, making four million compact radiators a year.

Local asshat MP adds: Paul Flynn, MP for Newport West: "This is a triumph for the new city and the Welsh assembly and further proof of the remarkable ability of south east Wales to restore its damaged economy."

**Still shame about that 60 million quid!
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