Remploy bosses insist they acted fairly in turning down a private bid to take over its Sheffield factory – which is now closing with the loss of 80 jobs.
Office furniture manufacturer Claughtons wanted to continue operating the Brightside Lane site, with two other Remploy furniture factories, as a going concern.
But Remploy said it had received ‘no viable bids’.
Gerard Toplass, Claughtons’ managing director, has demanded to know why his company’s bid was refused.
Mr Toplass said that although it would take up to three years to turn around the site, which is losing £650,000 a month, he was confident his firm’s proposals were viable.
But a Remploy spokesman said: “Bids were assessed against a range of criteria including continued employment of disabled people, sustainability of the proposed business and value for money to the taxpayer. The Claughtons bid did not represent best value for money.
“No decisions regarding the closure of Remploy’s Furniture business were made until best and final offers for the business were assessed by our advisers, KPMG Corporate Finance, and reviewed by the Remploy board, its executive team, an independent panel of experts and the Department for Work and Pensions.
“The bidding process operates on a fair and equitable basis and all bidders are treated the same.
“Bidders have been supported through the process and have been given access to the same levels of information alongside bidder guidance which clearly sets out the criteria upon which bids would be assessed.
“The bid by Claughtons did not provide value for money because it required a high level of continuing support from the taxpayer.
“It would have required subsidy to cover rent, future planned redundancy costs and injection of substantial working capital.
“The Claughtons bid was subject to independent evaluation and analysis by KPMG.
“We now have to move on and a comprehensive £8m package of support has been put in place to help disabled employees made redundant from Remploy to find alternative employment.”
Claughtons’ bid for the furniture factories was turned down after negotiations with another possible buyer, Barnsley-based Metalliform, collapsed.
But James Stribley, organiser for the GMB trade union, said: “This deplorable decision will mean many disabled people being consigned to a life on benefits.
“In the announcement from Remploy they have said there are no viable bids. GMB do not accept and dispute this statement and call on Tim Mathews - Remploy chief executive - to explain exactly why the bid that would have secured jobs at the Sheffield factory is not viable and value for money.”
Anne McGuire, Labour’s Shadow Minister for Disabled People, claimed the government’s record on disability was ‘a disgrace’ and said she feared staff would struggle to find alternative jobs.
But the Government says it is closing or selling Remploy factories because their subsidy would be better-spent helping a larger number of disabled staff into mainstream jobs than are employed by the company.