Notes went missing from the Royal Mint

Royal Mint chiefs have come under fire from MPs for a catalogue of errors that led to the theft of more than �25,000 and the loss of 220 jobs.

The influential Commons Public Accounts committee criticised "lax attitudes" to security and basic financial controls.

It also said it was time to end the Mint's immunity from prosecution after it emerged that it faced no criminal action over the death of an employee in June 2001.

A Health and Safety Executive investigation showed the Royal Mint was at fault over an accident in which long-term employee John Wynne was fatally injured when he was struck by a furnace that fell from the hook of an overhead crane.

Open all hours?

The committee, chaired by Conservative Edward Leigh, singled out the fact the Mint's safe was left unlocked during the day and the absence of CCTV in the area.

An earlier theft of �5,000 in banknotes had not prompted necessary new safeguards.

The Mint must make sure recent improvements in security are enough to prevent further theft of banknotes Edward Leigh

The Royal Mint had a �6.5m operating loss in 2001-2 - �25,680 of which was stolen banknotes.

But despite the theft of the �20 notes between April and December 2001 no arrests had taken place.

In fact the theft had lain undiscovered for up to eight months despite the fact the Mint's South Wales Llantrisant plant is guarded by MoD police.

The report said that neither the two keys containing the banknotes was held securely and was poorly located away from the gold store supervisor and once opened was left unattended until evening.

Metal detectors

Some contractors working on the site had access to the area where the safe was located.

Mr Leigh heads the Public Accounts Committee

Furthermore precautions to prevent the theft of coins such as metal detectors were not able to prevent the risk of people stealing banknotes.

The Royal Mint was also censured for embarking on a "seriously flawed" �25m expansion plan in 1997 to produce new coins for the launch of the euro.

It had set itself an over-ambitious target of securing 20% of the contracts.

Ultimately it secured just 5% having been slower than its competitors in reaching the technical specifications for producing euro coins in time for the 1 January 2002 launch of the single currency.

The plan cost �12m and 220 job losses resulted.

'Serious flaws'

Mr Leigh said: "The Royal Mint's decision to embark on a major expansion programme to produce new coins for the launch of the euro was seriously flawed.

"These failings caused over 200 people to lose their jobs.

"The continued losses must be addressed by getting a firm grip on costs and productivity."

"The Mint must also make sure that recent improvements in physical controls and security are enough to prevent further thefts of banknotes."

The Public Accounts committee urged vigorous action with any shortcomings in management following allegations the Royal Mint made improper payments.

Criticisms

The Serious Fraud Office is now investigating the claims to establish whether criminal offences have been committed.

The chief executive of the Royal Mint, Gerald Sheehan, said he would answer each criticism made in the committee's report.

And he stressed that he had tried to co-operate with their inquiry by providing a "detailed account" of the Mint's financial position.

"There is no quick fix for an organisation such as ours but I have reported to the public accounts committee that steady progress has been made in relation to a number of key corporate governance issues," he said.

"I have already taken the action necessary to fulfil the Royal Mint's obligation to maintain the highest ethical standards in conducting our business."