Business

Labour Party listed among creditors owed thousands by Harland & Wolff

Administrator’s report reveals government party and closely linked think-tank owed £30k by shipbuilder

PICTURE: JORDAN TREANOR
Harland & Wolff's famous cranes in Belfast, which could soon fall under the ownership of Spain's Navantia. PICTURE: JORDAN TREANOR
By Ryan McAleer

The Labour Party and a Labour-linked think-tank have been listed among the creditors owed thousands of pounds by Harland & Wolff Group Holdings.

Administrators from Teneo were called in by the company on September 27 in a process that does not include Harland & Wolff’s four shipyards.

Alongside the Belfast and Appledore yards, Harland & Wolff also owns the Arnish yard on the Isle of Lewis, and Methil in Fife. Between them, the four sites employ around 1,000 people.

Rothschild is currently overseeing the sale of the yards, with the state-owned Spanish shipbuilder Navantia currently in active talks to finalise a deal that could be closed as soon as this week.

But the first administrator’s report from Teneo has detailed £158 million owed to the creditors of Harland & Wolf’s non-trading parent entity, including a debt of £156.7m with New York-based lender Riverstone Credit Management LLC.

While as a secured creditor, Riverstone is first in line to recoup its debt, Teneo has listed 75 unsecured creditors owed in the region of £1.2m.

They include both the Labour Party, which is owed £18,000 and Progressive Britain, a think-tank with strong links to the government party, which has an outstanding balance of £12,000.

The administrators have already said they don’t believe there are enough assets available for unsecured creditors to see any money.

Progressive Britain said the £12,000 was the fee for Harland & Wolff to join its corporate forum for 2024.

The forum is promoted as a means to “build connections between the Labour front bench and the leaders of Britain’s key industries”.

A spokesperson for the think tank said: “I can confirm that we have not received any money from Harland & Wolff – this year or ever before – and we do not anticipate receiving any money from the administrators.”

It’s understood the outstanding money owed to Labour was a fee associated with their party conference.

The collapse of Harland & Wolff followed its failure to secure the backing of the new Labour government to provide a guarantee on £200m of new borrowing in a bid to refinance its high interest loan with Riverstone.

In a statement just 17 days after being named as the UK’s new Business Secretary, Jonathan Reynolds said the shipyard owner’s application for a UK Export Finance Export Development Guarantee represented “a very substantial risk” to the taxpayer.

Despite being part of a the Navantia-led consortium awarded a £1.6 billion MoD contract to build three vessels for the Royal Navy, Harland & Wolff’s upfront spending left it with pre-tax losses of £113m in 2022 and 2023.

The UK's Business Secretary Jonathan Reynolds (inset) and a wide view of the Harland & Wolff shipyard in Belfast.
The UK's Business Secretary Jonathan Reynolds (inset) said a government guarantee on £200 million of loans for Harland & Wolff posed too great a risk to taxpayer money.

With production for the seven-year fleet solid support (FSS) programme not due to start until 2025, liquidity became Harland & Wolff’s biggest issue.

Unable to secure Labour’s support for new finance, the company was left with little option than to call in the administrators.

Despite its interest via the MoD contract being chiefly with Belfast and Appledore, Navantia is reportedly in talks to acquire all four yards.

The state-owned company is also reported to be providing financial liquidity to keep the shipyards in business as it seeks to negotiate more favourable terms.

On Sunday, Sky News reported that the British and Spanish governments have been engaged in discussions about the prospective deal.

Any deal is likely to involve guarantees around job security.