John Shimmin has quit the Council of Ministers over the Sefton loans affair.
Chief Minister Allan Bell has reluctantly accepted Mr Shimmin’s resignation as Economic Development Minister, conceding his position was no longer tenable in the aftermath of revelations that two loans awarded to the Sefton Group were unlawful.
Just two days ago Tynwald was told the Minister had tendered his resignation but Mr Bell had declined to forward it to the Lieutenant Governor.
But following a crunch Council of Ministers meeting today, the Chief Minister, who has just returned from a trip to meet the Chinese Prime Minister, told iomtoday.co.im: ‘My primary concern throughout has been the protection of the economy.
‘That is why the government supported the Sefton Group in the first place and why I initially declined the Minister’s resignation because I was keen to maintain momentum and continuity in the development of the economy.
‘However, it is clear from further discussion with Mr Shimmin that he feels his role is untenable and he can no longer be confident of the political support necessary for the Department of Economic Development to progress its strategy.
‘He believes he must step down as Minister so the department can get on with its vital work without the hindrance of political controversy.’
Mr Bell paid tribute to Mr Shimmin for ‘his determination to do the right thing in the island’s national interest’.
Eleven months ago, the Economic Development Minister offered to fall on his sword if it was discovered that giving loans to the Sefton Group had been inappropriate.
This week the government was rocked by the findings of UK barrister Richard Moules, whose independent legal advice concluded that ‘more likely than not’ both the original £450,000 loan made in 2012 and a £1.3m cash loan given the following year were ‘ultra vires – i.e. not lawful’.
Mr Moules said neither loans should have been paid out as the Sefton Group was not an ‘eligible business’ under the Enterprise Act as it was in arrears with tax and had incurred civil penalties.
He said government has powers to recover the money, or it could enact legislation to validate the loans retrospectively.
The DED Minister’s future and the government’s response to the legal opinion were top of the agenda at this morning’s CoMin meeting.
The question is now who will be named as Mr Shimmin’s replacement.
Mr Moules’ legal opinion prompted an emergency debate in Tynwald and calls for Mr Shimmin’s resignation to be accepted - and even for Ministers to be surcharged.
In a statement to Tynwald Mr Shimmin apologised unreservedly for the failure for which he said he took full responsibility.
During the emergency debate he said that after 12-and-a-half years as a Minister, the decision had been ‘quite straightforward’ to tender his resignation by email to the Chief Minister at 8am on Tuesday.
He said he would speak to Mr Bell on his return to find out why his resignation had not at first been accepted. He said he believed this was because of the support he had received from the business community.
Mr Shimmin is expected continue to working as a backbench MHK. Now he is no longer a minister, it means he will be paid less.
A minister gets 50 per cent more than the MHK’s basic salary of £38,771.33.
Today’s Manx Independent’s editorial comment called for Mr Shimmin to go.
John Shimmin was born in Douglas in 1960.
He was educated at Douglas High School and Worcester College of Higher Education where he studied physical education.
Having enjoyed a career in teaching, both in the UK and the Isle of Man, he decided to enter politics in 1996 and was elected to the Tynwald for Douglas West at his first attempt.
In 1999 he became chairman of the Isle of Man Post Office and then went on to undertake a variety of ministerial roles in the Departments of Transport, Home Affairs and Local Government and the Environment.
Following the restructuring of Government in 2010, Mr Shimmin became Minister of the Environment, Food and Agriculture before being appointed by the Chief Minister to his position as Minister for the Department of Economic Development in October 2011.