Prescott backs aide in shares profit row

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The Independent Online
John Prescott has been forced to defend his appointment of a special adviser whose company may profit from the government reforms he oversees.

David Taylor, who is advising the Deputy Prime Minister on plans for a network of regional development agencies, also runs and holds shares in a firm which is likely to bid for grants from them. He earns pounds 140,000 per year as chief executive of Enterprise Plc and also holds shares in the firm.

The unpaid part-time adviser to Mr Prescott is also a former chief executive of English Partnerships, the development agency which owns the site of the millennium exhibition. The agency's future is under review as part of the consultation on the new regional agencies.

Enterprise Plc, formerly Lancashire Enterprises, was set up in the 1980s as the privatised development arm of Lancashire County Council and made a profit of pounds 3m last year. Mr Taylor owns 3,000 shares in the company and has an option on a further 300,000. Owen Oyston, the Lancashire millionaire serving a jail sentence for rape, is a former director and still a shareholder. Louise Ellman, the Labour MP for Liverpool Riverside, is a director.

Mr Prescott was forced to comment in response to a letter from Gillian Shephard, the shadow leader of the Commons. She argued that Mr Taylor should either relinquish his shares in the company - as the industry minister, Lord Simon of Highbury, was forced to do with his British Petroleum shares - or resign from his post in Mr Prescott's office. Enterprise was reported to have confirmed that it intended to bid for Regional Development Agency funds, she said.

However, Mr Prescott maintained that he had acted in accordance with the ministerial code of conduct.

"David Taylor ... serves me personally as an unpaid special adviser and is able to bring to bear substantial expertise, particularly on regeneration and regional issues.

"While I entirely agree that the handling of these issues needs care they are not different in principle to those which the previous administration had to address and I can assure you that the necessary care is being taken," he said.

Mrs Shephard is on holiday, but last night Christopher Chope, the Tory spokesman on environment, transport and the regions, said: "We are not totally satisfied with the response. We will be seeking further assurances."