DTI gives grant to Major's bankrupt friend: Inventor gets pounds 25,000 to make gaming machines
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Your support makes all the difference.PUBLIC MONEY is being given to help a business run by a friend of John Major's who is a Conservative Pary fundraiser and has gone bankrupt.
Gordon McNally and his wife, Henrietta, have visited the Majors at their home in Huntingdon and at Chequers and have socialised with them on at least six occasions.
The McNallys hosted a private party for senior members of the Prime Minister's Huntingdon constituency association and business guests at their luxurious flat in Mount Street, Mayfair, central London. The party was a personal thank you from Mr Major to the organisers of his constituency association's annual ball: the business guests had sponsored the ball. Mount Street was sealed off for the evening in an extensive and costly security operation.
Despite the lavish decoration and furnishings of the flat, Mr McNally, 48, an inventor and former business partner of Lord Hesketh, the recently retired Tory chief whip in the House of Lords, had gone bankrupt. He said last week that he has been named in private evidence to the Scott arms- to-Iraq inquiry.
A bankruptcy order was made against him in August 1990 and has still not been discharged. Andy Samuels, from the Official Receiver's office, said last night: 'I can confirm unequivocally that Gordon McNally is bankrupt.' He had 'no funds for distribution - he has no assets at all'.
Yet in January last year, soon after the party, Mr McNally approached officials in Mansfield, Nottinghamshire, for grants for two products - an automatic roulette machine and a computerised car park.
Mansfield has been hit hard by the rundown of the Nottinghamshire coalfield and qualifies for assisted area status. Mr McNally told officials at Business Technology Network, set up to encourage new industries into the town, that he was an inventor and a close friend of Mr Major's.
He did not tell them he was an undischarged bankrupt, and was under no obligation to do so, but they discovered that later.
He was referred to the Department of Trade and Industry, which administers the grants. Last July the DTI offered McNally Industries (Mansfield) Ltd the maximum it could receive at this stage: a development grant of pounds 25,000.
The meetings and grant negotiations were conducted by Mr McNally. On paper, however, the company is run by three people, including Henrietta, an Australian-born actress. As an undischarged bankrupt, Mr McNally is forbidden from becoming a company director.
Trading while a bankrupt is an offence which can, on conviction, carry a jail term. Mr McNally is not a director of McNally Industries (Mansfield) Ltd but he appears to have been active in the business.
He said during a lengthy telephone conversation last week that he was in charge of the plans to build a factory in Mansfield for production of his gaming machines and that he has been conducting the negotiations.
His wife is listed as a director of the company but has taken no active part in obtaining the grant, although her name was on the application.
Latest company records show Mrs McNally is resident in East Brighton, Victoria, Australia, and that her profession is 'actress'. However, she is currently sharing the Mayfair home with her husband. Other directors listed are Dean Lees, who lives in Nottinghamshire, and Michael Oaksmith, of the United States.
In interviews with the Independent, Mr McNally has repeatedly said that he is in charge of the Mansfield project. Potential sub-contractors of McNally Industries said they had dealt with Mr McNally, not his wife.
'I am moving production of my car parks and gaming machines to Mansfield,' Mr McNally said. 'I am getting government support.' He claimed to be worth 'quite a few millions' and said he had chosen Mansfield because he wanted to help the Nottinghamshire miners.
The DTI said the company applied for and was offered a development grant. The department understood it was 'the company's intention to establish a manufacturing presence in Mansfield'.
Downing Street said last night that it had no information about Mr McNally or his friendship with Mr Major.
Chequered career, page 3
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