Thank you for the replies and suggestions, all very helpful indeed and I am most grateful
This does seem to be a known "fault" that VW rectified post 2013 and I cant see any published recalls and we certainly hadn't received any from them. My thoughts from a consumer point of view are that the chain was not fit for purpose from the outset and therefore the goods were not as described or performed as could be reasonably expected in normal usage.
They have confirmed the chain has stretched and having reset the timing they undertook a compression test which gave a zero bar reading on all cylinders - all valves are leaking when closed. From this they deduced that valves and pistons have come together. They have said they will need to strip the head to confirm this which could be a bill of up to £1000 which I have questioned in the strongest possible terms as we're already £340 in for them to check the chain and do the compression tests. To my mind, £1000 to strip the head of a 3 cylinder Polo is taking the proverbial but I remain calm and collected but firm with them.
I have remained calm, polite and professional in my dealings with VW so far and where possible I have aimed to talk turkey on a face to face basis rather than over email or phones. I find face to face usually gets the best results out of people. In fairness to the service staff at VW, they have afforded me the same courtesy.
I have requested the name and contact details for the perons(s) the dealer principal is responsible to both at Inchcape and at VW UK and in the absence of the service team coming up with a solution I have said I will need a meeting with the dealer principal as the next step.
I am happy to allow them to make whatever enquiries they need to with Inchcape and VW UK to offer me an acceptable solution. If there isn't an acceptable solution from them, I will need to turn up the heat with some of the suggestions given.
I have some sterling legal minds behind me if needed!
Will keep you posted.