An investigation has been launched into how senior civil servants came to tell a Stormont Committee that one of Northern Ireland's leading motor firms had agreed to participate in a £5m contract to train mechanics.
The managing director of Donnelly and Taggart has written to the committee denying that it had entered into an agreement with troubled British company Carter and Carter to train mechanics at the firm's Eglinton premises outside Londonderry.
The Committee for the Department of Employment and Learning (DEL) was told by civil servants at its meeting on September 19 that Nottingham-based Carter and Carter would fulfil the contract through the Blackwater House training facility at Mallusk and Donnelly and Taggart in the north west.
The claim helped allay fears from trade unions and MLAs that the Carter lacked local facilities.
The contract was awarded under the Training for Success scheme.
On October 12, Donnelly and Taggart managing director TA Donnelly wrote to committee chairwoman Sue Ramsey saying that, "at no time has Donnelly and Taggart entered into an agreement for provision of (training) facilities nor, in fact, discussed the possibility of such an arrangement".
He added: "Donnelly group would have reservations on a company who referred to agreements which have not been made."
On October 25, Ms Ramsey replied on behalf of the committee: "I have forwarded your correspondence on to the relevant Departmental officials for an urgent explanation and answer on this issue."
The contract was awarded to Carter and Carter in May. It was scheduled to come on stream at the beginning of September.
On August 30, Carter and Carter announced its acquisition of Blackwater House for £980,000.
Nipsa union's Dooley Harte, who had attended the September committee meeting and expressed union fears over the contract, commented afterwards: "The criteria laid down included that any bidder had to be financially sound and have a track record and a demonstrable ability to deliver. It also had to be able to show that its tutors and trainers were suitably qualified and experienced. But this company only acquired training capacity here three months after winning the contract - and three weeks before it was due to start delivering. How can this have happened?"
He added yesterday: "Now it seems that the second facility which the civil servants assured the committee had been arranged had in fact not been arranged at all.
"The public is entitled to a detailed account of the process by which this company was selected as the sole provider in the North of training for apprentice mechanics."
Carter and Carter suspended its shares on October 2 after finance director John Green quit.
A spokesman for Carter and Carter commented: "There may have been discussions with various interests about fulfilment of the Training for Success contract, but we can confirm that there was no written agreement with Donnelly and Taggart."