Stephen Byers: Sustained attacks

Mr Byers has faced weeks of sustained criticism after he insisted that he only knew of BMW's plan to sell-off Rover when it was announced last month.

BMW is holding talks with venture capital group Alchemy Partners over the future of Rover's Longbridge plant. Trade union leaders have been meeting the company to urge it to consider a second consortium's bid.

While the report was highly critical of BMW, saying its approach to the break-up had been "chaotic, incomplete and incoherent", it asked why the DTI did not ask more questions on the future of the Longbridge plant in December following a crucial meeting with BMW.

"It would be reasonable to have expected the secretary of state and his officials to have sought to discover BMW's views on this subject," the report said.

'Five minutes to midnight'

In his evidence to the committee, Rover chairman Werner Samann described how he told Mr Byers "Rover was in survival mode and it was five minutes to midnight".

But the chairman of the committee Martin O'Neill said: "It is apparent that the secretary of state was indeed given some advance indication of BMW's plans on 10 March, and that his officials had allegedly been similarly warned on 23 February."

"But the plans of which they were given notice bore no relation to what the BMW board decided on 16 March [to sell-off Rover].

"There was no suggestion that Longbridge and Cowley were for sale, let alone Land Rover, nor that BMW had begun hawking them around the world's principle car makers."

The report described further information from BMW to the DTI as "worthless and positively misleading".

Thousands of jobs are at stake

The result of a "lack of candour" had denied the minister the opportunity to argue Rover's case or propose alternative solutions, said Mr O'Neill.

"Given assurances from the most senior managers of BMW in the UK and in Munich, it is hard to see how the secretary of state could have anticipated the decision of 16 March," he said.

"We do however, detect some failure in the government's intelligence-gathering mechanism in recent weeks.

"While some signals may have been no more than straws in the wind, we have a strong sense that he machinery of government could and should have done more."

The prime minister's official spokesman, Alastair Campbell, praised the report saying: "We have been clear throughout that the prime minister thinks Stephen Byers handled [the Rover situation] extremely well."

John Edmonds, head of the GMB trade union, said that the Department of Trade and Industry had "dropped the ball".

"It is high time the DTI was restructured and given a new remit," he said.

"Its job from now on must be to ensure the defence and promotion of British industry at home and abroad. We must never see a situation akin to Longbridge again."

Former Conservative Trade Secretary John Redwood said the report showed Mr Byers had either been incompetent or had misled everyone.