Millions wasted on Armouries say MPs

The Government wasted millions of pounds of taxpayers' money by bailing out the privately-run Royal Armouries museum in Leeds, MPs ruled today.

The judgment by the Public Accounts Committee is another blow to the reputation of former Culture Secretary Chris Smith, who was responsible for the decision. Under a deal struck by the Conservative government in 1993, exhibits were moved from the Tower of London to a £43 million museum.

A private finance initiative (PFI) deal was struck with Royal Armouries (International), which put up £14 million to operate the attraction. Low visitor numbers meant the company ran up losses of £10 million. Faced with the prospect of seeing the museum shut, ministers paidoff the debts and took it back under public control.

Today's report said the bail-out made a "mockery" of the idea that the private sector is paid for taking risks.

Committee chairman Edward Leigh said: "The handling of this was weak and commercially naive."