'There was no ulterior motive'

Those are the words of Charles Fargher, one of four former members of the Manx Electricity Authority board who gave evidence in front of a Tynwald select committee today.

The committee was set up in 2005 to investigate the borrowing by the MEA of ?120 million, which was arranged without Treasury approval.

The money was needed to make up a shortfall to fund several major projects.

Matt Kennaugh reports (text, below, from attached audio file):

The former board members who gave evidence today were Charles Fargher, Trevor Ferrar, Terence Duncan and Doctor John Taylor, who all served on the board between 2000 and 2005.

The committee questioned each of them in turn and asked if they were aware Treasury approval was needed for two loans taken out by the Manx Cable Company, a subsidiary of the MEA.

One of the loans was for ?70 million and another for ?50 million.

All four witnesses said they were under the impression Treasury knew, but didn't think such approval was needed.

Government had given the MEA ?185 million but the cost of building Pulrose power station, an undersea electricity and fibre optic cable and a natural gas pipeline spiralled to ?305 million, creating a significant deficit.

When asked if the MEA had deliberately avoided obtaining Treasury consent, all four of the former MEA board members told the select committee that wasn't true.