The Government is to launch an investigation into the Rover sell-off by German car-giant BMW.

The inquiry, to be held by the House of Commons Trade and Industry Select Committee, will explore what options there are for finding an alternative buyer for Rover, as well looking at the Government's role in the affair and ask whether it could have done more.

Committee chairman Martin O'Neill said the inquiry, which would begin within a fortnight, would seek to establish a firm record of the events surrounding the sale.

Mr O'Neill said he did not believe Trade and Industry Secretary Stephen Byers had been "culpable" in the matter.

He said: "I think if people set out to act in a clandestine fashion - and from what I can gather of the discussions he had less than days ago with the director of BMW, the man didn't tell the truth - I don't really know what he is expected to do." Detail of the inquiry came as many of the 9,000 workers at the Longbridge plant, in the West Midlands began to feel the direct effects of the sell-off and as calls were made for British consumers to boycott BMW cars.

"Our members want to hit BMW where it hurts - in the profits," said Sir Ken Jackson, general secretary of the Amalgamated Engineering and Electricians Union.

But the Prime Minister Tony Blair held back from expressing support or disapproval for the calls, with Downing Street saying only that "people will make their own purchasing decisions".

Pressure is mounting on BMW to make a generous contribution to the regeneration efforts needed to cope with job losses in the West Midlands following its sale of Rover last week.

From this morning, a large part of the Longbridge workforce was facing the scaling down of shifts at a cost of about £80 from each monthly pay packet. Mr Byers and delegations from trade unions will be visiting BMW's Munich headquarters this week to discuss the impact of the shock decision.

Mr Byers, who flies to Munich on Thursday, yesterday said BMW's failure to disclose their plans to the Government led to damaging delays in the regeneration programme.

Mr Byers said that in talks with BMW director Prof Werner Samann just six days before the announcement, he had been given no hint that a sale was in the offing.

Andrew Smith, Oxford East MP and Chief Secretary to the Treasury, was expected to visit the Cowley plant this morning. He was due to talk with workers, trade union representatives and plant managers.

*The Government came under fire last night from union leaders over the lack of rights for workers facing redundancy.

Officials complained the secretive sell-off of Rover by German owners BMW, with the likely loss of thousands of jobs in the next few weeks, could not have happened in other European countries because of stricter laws on consultation. One union wrote to the European Commission complaining that a directive covering collective redundancies has not been properly implemented in the UK.

The Manufacturing Science and Finance Union said laws were too weak in this country, making it easier for BMW to off-load Rover.

General Secretary Roger Lyons said: "It is a disgrace that British workers get less protection from mass redundancies than their European counterparts.

"The Rover disaster must surely teach the Government the lesson that complete deregulation of the Labour market encourages short-termism and creates insecurity."

The union says laws should be changed so firms have to consult their workforce before announcing huge redundancies.

The TUC said the priority now was to keep pressure on BMW to put together a package to help the West Midlands and other areas hit by the sell-off. A spokesman said: "When the dust has settled there will be a need to look at all the wider policy implications from the value of the pound, our relationship to the euro through to the rights of workers caught up in this kind of catastrophe."

Story date: Monday 20 March

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.