Today
Sun 5 December 2021

Significant amounts of public money have been invested in the company, yet the Government hasn’t declared any conflicts of interest, reveals Sam Bright

The Government has invested £12.4 million in a company owned by a Conservative Party donor for the research of flying taxis, Byline Times can reveal.

The funding has been provided via Innovate UK – a Government body that since 2007 has invested some £2.5 billion to help businesses to develop new ideas and technologies. Innovate UK works with various Government departments and agencies to deliver the public investment, under the direction of the Department for Business, Energy and Industrial Strategy (BEIS).

Government records show that, in the 2020/21 financial year, £12.4 million in grant funding was awarded to a firm called Vertical Aerospace Group, via the UK Aerospace Research and Technology Programme. This has been one of the largest sums of money handed out by Innovate UK during the last three financial years, the Government data shows. BEIS has also invested £2.5 million in a consortium associated with the firm.

According to Innovate UK, Vertical Aerospace “is developing a high performance urban air taxi, electrically powered, and capable of vertical take off and landing”. The Government’s investment will help the firm to “develop the key technologies to enable the aircraft to commence prototype flight testing”.

Vertical Aerospace Group is owned by Stephen James Fitzpatrick, who also acts as its CEO. Fitzpatrick, a wealthy entrepreneur, has many business interests – also owning a company called Imagination Industries Incubator. In March 2019, Imagination Industries Incubator donated £173,000 to the Conservative Party, while a Stephen J. Fitzpatrick similarly donated £12,000 to the party a month earlier.

There is no suggestion that Vertical Aerospace has been awarded Government grants due to the donation of Imagination Industries Incubator to the Conservative Party. Indeed, all recipients of Innovate UK funding are subject to a competitive application process.

“All decisions regarding funding are made through a completely fair and open process. Vertical Aerospace received funding to support the innovative low carbon technology it is developing which is helping to unlock urban air mobility,” a BEIS spokesperson said. “Exciting advances in low carbon aerospace technology like this are proudly supported by the Government.”

However, Fitzpatrick’s political interests were not declared by the Government when the funding was announced. Subsequently, Fitzpatrick’s links to the Conservative Party have not been reported by the media, in relation to the work of Vertical Aerospace.

Indeed, an aversion to transparency is witnessed throughout the Government’s work with private sector firms. The Government has spent tens of billions of pounds on the goods and services provided by the private sector during the pandemic – at least £3 billion of which has been awarded to firms with links to the Conservative Party. Yet, the Government has not publicly declared potential conflicts of interest when releasing the contracts.

This defies the Government’s own recommendations. The Cabinet Office has issued guidance to departments on public sector procurement, updated in May, warning of “far-reaching consequences” if conflicts of interest are not handled properly. If the public perceives a potential conflict of interest in the awarding of a contract, this can risk “reputational damage, undermining public confidence in the integrity of the organisation and Government as a whole,” the Cabinet Office warns.

Failing to declare the political interests of individuals involved in Government contracts and grants surely does nothing to improve confidence in the process.

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The Government’s funding for Vertical Aerospace will be devoted to developing a “smart charger” for the firm’s VA-4X electric aircraft.

“The charger will analyse in-flight and charge event data. This data could then be used to optimise battery lifetime, schedule maintenance and detect anomalies. The charger will be able to determine battery lifetime, state of charge, and will detect any potential failures onboard the vehicle’s battery before they happen,” a press release on the company’s website says.

The firm claims to be revolutionising air commuting by developing a five-person aircraft that has zero emissions and can travel at speeds of up to 202 miles-per-hour. The VA-4X, which has the appearance of a helicopter merged with a small aircraft, has already received pre-orders from American Airlines, Avolon, and Virgin Atlantic, subject to conditions.

Vertical Aerospace is set to float on the New York Stock Exchange later this year, by virtue of a £2.2 billion merger. Although the VA-4X has yet to take its first test flight, aviation firms believe the aircraft could be used to transfer passengers between home and airports.

The development of the smart battery is expected to conclude in October 2022, while the company hopes that the VA-4X will be certified by the European Union Aviation Safety Agency in early 2024.

Vertical Aerospace andImagination Industries Incubator were approached for comment.

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