Isle Of Man / Ellan Vannin

Economic Development Minister steps down over hotel deal

The Manx economic development minister has stepped down following a row over the legality of a hotel bail-out.

John Shimmin tendered his resignation on Tuesday but it was originally refused by the Chief Minister.

It comes after legal experts found that a multimillion-pound deal to bail out a hotel group in the Isle of Man was "outside of government powers".

Independent London lawyer Richard Moules said the two loans given to the Sefton Hotel chain were "ultra vires".

Chief Minister Allan Bell said on Thursday, that after a conversation with Mr Shimmin he had decided to accept his resignation.

'Very disappointing'

He said it was "very disappointing but I can understand Mr Shimmin's position".

"Ultimately we have to think about the people of the Isle of Man and growing the Manx economy- it's most important we don't lose that momentum."

The £4.5m rescue package for the Sefton Group included a £1.3m loan, plus £3.2m to buy land in Douglas earmarked for development.

The Sefton Group PLC is a Manx company, which owns the Sefton and the Palace Hotel Casino on Douglas promenade, along with the Sefton Express hotel near Ronaldsway airport. The group employees about 300 people.

The bail-out package was scrutinised externally after being criticised by Tynwald members for being "unfair" and "biased".

John Shimmin has been an MHK for Douglas since 1996 and has been the island's economic development minister since 2011.

He has also held ministerial positions in Home Affairs, Local Government and Transport.

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