Saving Thomas Cook with a £250million government lifeline would have been throwing “good money after bad”, the Transport Secretary has claimed.
Grant Shapps was slammed for his comment during an urgent Commons debate as it emerged the failed holiday giant owed its suppliers £500million.
Taxpayers are now facing a redundancy bill for Thomas Cook’s 9,000 UK workers and a £100million bill for repatriating 150,000 stranded holidaymakers.
Mr Shapps said: “Our concern was we would put £250million at risk and thrown away good money after bad, then still have to pay for this repatriation.”
But Shadow Transport Secretary Andy McDonald said the Government “sat back and let the company fold”.
Pressure is piling on the Tories after it emerged Turkey and Spain had offered big investments to help Thomas Cook.
But Mr Shapps insisted that Turkey made no approach and the travel firm was “not viable” by the time Spain made its offer.
The TSSA union’s Manuel Cortes said: “The public deserves to know whether our Government was negligent in not acting to safeguard Thomas Cook.”
Court documents filed this week show the firm had a deficit of £3billion – with £1.9billion of debt and nearly £500million owed to suppliers. It had £31million in the bank. Swiss chief executive Peter Fankhauser, 59, concluded in the documents that the firm would “run out of cash” by October 4 “and
probably earlier”.
He and other ex-bosses were criticised after directors were revealed to have shared £50million in pay and
perks since 2008.
Mr Shapps said an Insolvency Service probe would look at the role of directors and had powers to recoup bonuses.
Meanwhile, Thomas Cook customers have reported price rises when trying to book new breaks.
Danielle Quinnin, 26, of Whitley Bay, Tyne and Wear, had booked a £6,000 trip to Disney World.
She said she found a similar trip for £3,174.47 with Virgin Holidays but when she and husband Dean, 32, tried to book two hours later, it was £22,276.53.
Virgin said prices only rise due to high booking volumes and limited availability.
Some Thomas Cook customers have been targeted by scams offering refunds to con them into revealing bank details.
And several tourists were prevented from leaving Cuba without paying extra for their hotels. The deadlock was ended by the British ambassador to Cuba
Rescue flights are now bringing home stranded holidaymakers in an operation expected to take up to two weeks.
