Minister for Enterprise Tim Johnston said that Cube International, which recently had their contract terminated as supplier of the official Isle of Man TT merchandise, owes local suppliers £65,000.
The Department of Enterprise said earlier this month that local retailers were 'not exposed financially' by the government's decision to scrap the contract with Cube because 'merchandise was provided to retailers with payment due after receipt of goods.'
Cube International also owes the government £160,000 plus VAT, with the amount expected to climb daily as interest is applied for a late penalty.
The company had its contract terminated due to a breach in terms to fulfil their required financial obligations within the contracted timeline, despite the contract intended to be for an initial three-year period.
An investigation by Isle of Man Today's sister company Gef revealed that the original TT merchandise contract was awarded to Cube Partnership, which has since gone into liquidation.
Cube Partnership Limited was awarded the contract after a tender process in January before going into voluntary liquidation in July.
The contract was novated by its parent company Cube International, before it was terminated.
In the House of Keys this morning MHK for Douglas North, Mr Wannenburgh, asked Minister for Enterprise Tim Johnston what due diligence was carried out on Cube and by whom; how much is owed by Cube to the government and to other island businesses; and what measures will be taken to recover the amounts owing.
Tim Johnston MHK emphasised that the department will push for full payments.
He also confirmed that 18 companies are now in the running for the TT merchandise in the tender process.
Mr Callister MHK asked whether the Minister for Enterprise could guarantee if merchandise will be on the shelves at TT 2024, to which Mr Johnston replied that there will be merchandise and the tendering process is underway.
Mr Glover asked whether the chosen business for the merch should be a Manx one, to which Mr Johnston said he welcomes local businesses interest, but the department are showing 'proper due diligence' and they're going out to market and welcoming all businesses.
Mr Ashford said there is a number of public statistics available that show why Cube should've rung alarm bells for his department, to which the Minister replied that everything was done correctly in terms of researching Cube and that they were an established company at the point of accepting them.
Mr Wannenburgh said : 'Is it not time someone got a grip of your department'.