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Job Losses in Manufacturing Industry

Private Notice Question – in the Northern Ireland Assembly at 4:00 pm on 20th April 2009.

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Photo of Francie Molloy Francie Molloy Sinn Féin 4:00 pm, 20th April 2009

The Speaker has received a private notice question, in accordance with Standing Order 20, to the Minister of Enterprise, Trade and Investment. I advise the House that, generally, when dealing with a private notice question, only the Member who tabled the question and the Chairperson or Deputy Chairperson of the relevant Committee is called. However, given the issue’s importance, the Speaker has agreed that each party will be given the opportunity to ask a supplementary question.

Mr Attwood asked the Minister of Enterprise, Trade and Investment to provide an update on the loss of jobs at Visteon, Shorts/Bombardier, FG Wilson, Nortel and other companies; and on what steps are being taken by her Department to protect the rights of workers and the manufacturing base in Northern Ireland respectively.

Photo of Arlene Foster Arlene Foster DUP

From the outset, I want to reiterate that the job losses that have been announced during the past few weeks by Bombardier, Nortel, FG Wilson and, of course, Visteon are a matter of great regret. My thoughts remain with the employees and families who are affected.

Coming so close together, those announcements underline the impact of the global recession on Northern Ireland and illustrate how much market conditions have worsened during the past few months. I met Bombardier to hear and understand at first hand the reasons behind its redundancies. I am due to have a further meeting with the company’s senior management at the beginning of next week.

Invest NI is currently engaging with FG Wilson in respect of significant training and R&D initiatives which offer opportunities to redeploy and retrain skilled labour as an alternative to redundancies. The company is also developing a comprehensive training plan for Invest Northern Ireland’s consideration, the focus of which will be on enhancing FG Wilson’s skill base to ensure that its products and processes remain amongst the most competitive in the world.

In the case of Visteon, trade union officials from Unite continue to discuss the current situation with the corporation. I have had useful meetings with trade union representatives since the closure — [Interruption.]

Photo of Francie Molloy Francie Molloy Sinn Féin

Order. The Minister has the Floor. Members must resume their seats. I am sorry to interrupt your remarks, Minister.

Photo of Arlene Foster Arlene Foster DUP

I have had useful meetings with trade union representatives since the closure of the factory was announced.

In respect of Nortel Networks, Invest NI continues to meet and communicate regularly with both the company’s administrators and its management. Speculation continues that Nortel may be able to attract interest in the sale of its core wireless-equipment business to other major blue-chip companies. We are also, therefore, working to ensure that we can promote fully the Monkstown campus’s capabilities to take advantage of any new foreign direct investment (FDI) opportunities that may arise.

Unfortunately, in the majority of those cases, redundancies have been a necessary evil and have been made in order to protect the long-term interests and employment potential of major local operations, with Visteon, obviously, being the one to which that does not apply.

The employment rights of workers who have been made redundant by their employers are set out in the Employment Rights (Northern Ireland) Order 1996, which is, as Members will be aware, the responsibility of the Department for Employment and Learning (DEL).

If those workers feel that their rights have been breached in the execution of those redundancies, they can avail themselves of the services of their trade union, employee legal representatives or the Labour Relations Agency and seek the appropriate advice and guidance that could, ultimately, lead to redress through an industrial tribunal. The interpretation and application of employment law is, ultimately, the role of the chairmen of the industrial tribunals and fair-employment tribunals, who are members of the independent judiciary appointed by the Lord Chief Justice.

It is important that we continue to protect our manufacturing business base and ensure that when market conditions improve, Northern Ireland businesses are well placed to capitalise rapidly. Collaboration is a necessity, and I am working closely with my colleague the Minister for Employment and Learning to identify, as a matter of urgency, any new policies and schemes that could be introduced within the powers and resources that are available to the Executive. That work focuses on the provision of practical support and advice as well as implementing training and reskilling programmes and assistance.

As Members may be aware, I recently announced the establishment of a manufacturing advisory group as a subgroup of the Economic Development Forum (EDF). Trade unions suggested that idea to me recently, and it has received broad support from other members of the EDF. I can announce today that Mark Nodder, managing director of Wrightbus, has agreed to chair that subgroup, and work is currently under way to develop the terms of reference and agree membership. Those arrangements should be in place in the very near future, and I expect the first meeting to be held shortly.

On an international scale, the Government continue to take action to bring stability to the financial markets on which all businesses depend. We are in constant dialogue with business about how to alleviate the current difficulties. However, people must realise that there is no easy fix and that the measures will take time to have an effect.

Photo of Alex Attwood Alex Attwood Social Democratic and Labour Party

I thank the Minister for her presence this afternoon, and I acknowledge that, during the recent difficult weeks, she has been available in person and by phone. Given that Ford and its subsidiary Visteon have benefited from millions of pounds of grant aid over many years for operations in Northern Ireland, does she consider it unacceptable for Visteon to get up, go, and close its doors? It is a slap in the face for the company’s workers, who, during many difficult years, always turned up to work for Ford in this part of the North.

Furthermore, is she concerned that the actions of Visteon and Ford, in denying their obligations to workers and by setting up subsidiary companies, could become a model for other international companies that operate in Northern Ireland and which might do likewise in the future? Finally, what contact has the Minister, and other levels of Government, had with Ford in America in order to ensure that Ford and Visteon honour their obligations to the 200-odd workers in west Belfast?

Photo of Arlene Foster Arlene Foster DUP

I thank the Member for his supplementary question. I had useful meetings with SDLP and Sinn Féin delegations about the issues that the Member mentioned. I heard, at first hand, how hurt the workers felt about their treatment by the management of Visteon, which, rather than announce the news themselves, left that task to the administrators. I empathise with the workers’ feelings. However, we must now consider ways to help those people.

I have made several attempts to speak to Ford in Europe — I forget the gentleman’s name — but have, unfortunately, been unable to connect with him. I will continue to try to contact him about issues that are within my remit. I encouraged trade union representatives to continue to seek legal advice and to continue to work with their unions. Furthermore, I urged them to look to their contract, which they showed to me, particularly the element that said that their conditions would mirror those of their Ford counterparts — I think that that was the term that was used. I understand that Unite continues to engage with Visteon and Ford, and Government will continue to monitor the situation and do what we can.

Photo of Mark Durkan Mark Durkan Leader of the Social Democratic & Labour Party

I thank the Minister for the details that she has outlined in answer to the question. The Committee for Enterprise, Trade and Investment recognises that these are serious difficulties for any Minister to have to confront at the rate at which events have unfolded in recent times.

Will the Minister indicate whether she is content with the degree of economic intelligence available to her and her Department in advance of some developments, and whether she is looking at ways of improving the advance warning that the Department might have? What other interventions are she and her Department looking at in trying to ensure more effective support for firms and workforces that face such situations? Is she considering relaxations of specific EU state-aid rules in order to allow us to help in ways that have been ruled out in the past and to restore some of the supports that were available in the past?

Photo of Arlene Foster Arlene Foster DUP

I thank the Chairman for the points he has made. In relation to the first of those issues, I am satisfied with the economic intelligence available insofar as it goes. However, some of the companies involved — I am thinking of Bombardier in particular — are quoted on stock exchanges, and we do not have the information as quickly as we would like, but we understand why that is so. The information is provided to my Department as quickly as it possibly can in the circumstances. To be fair to all of the companies — Nortel, Bombardier and the other company — they have all been in constant contact with my Department, and are working with us. They are trying to find ways of reskilling their people as an alternative to redundancies.

I had a useful meeting with the Minister for Employment and Learning last week, and we are looking at ways to refocus on the provision of practical support for those people who find themselves in difficulties, and for those companies that are economically viable in the medium to long term, but are facing short-term difficulties. Those are the companies with which we need to work, in order to find ways in which to keep those people on board in the short term. The Minister for Employment and Learning and I hope to make an announcement in relation to those issues in the near future.

Photo of Simon Hamilton Simon Hamilton DUP

I join with the Minister and others in expressing my concern at the job losses, particularly those at Bombardier Shorts, which most directly affect my constituency and constituents. Does the Minister agree with me that those job losses underscore the importance of the CSeries project? Given the importance of the manufacturing sector to the Northern Ireland economy despite these job losses, can the Minister confirm that she, her Department, the Executive and Invest Northern Ireland remain committed to the manufacturing sector in Northern Ireland, and will she outline how that commitment is manifested?

Photo of Arlene Foster Arlene Foster DUP

In relation to Bombardier, the CSeries project is on schedule. My Department and I are working closely with the company to make sure that that new, highly technological development that is taking place here in Belfast goes ahead. There was some confusion in some of the media reports of the Bombardier job losses that they were in some way linked to the CSeries project; they are not. The jobs that will be lost at Bombardier are as a result of the current global recession, and Bombardier has revised its current aircraft production rates downwards. That has nothing to do with the development of the CSeries; in fact, the CSeries development shows that the company is looking to the future. It is providing a new aircraft that will be fit for purpose for the latter half of the twenty-first century. We should take that as a sign that the company is here, and is here to stay.

Indeed, FG Wilson confirmed today in a statement that it remains absolutely committed to its plants in Northern Ireland, and refuted any allegations to the contrary. Those companies are here in Northern Ireland, and want to stay in Northern Ireland, because they know the value of the workforce and the skills base here.

However, those companies are facing a short-term downturn. The Government must find ways to help them, which is why I am having talks with the Minister for Employment and Learning, in the hope that we can bring forward a package to help the manufacturing sector in particular, which, as we know, lost 2% of its base in just one week. That was a huge hit, and we must provide a rapid response that will help the manufacturing sector.

Photo of Paul Maskey Paul Maskey Sinn Féin 4:15 pm, 20th April 2009

Go raibh maith agat. We hear that the administrators are trying to take action against the Visteon workers to remove them from the site. Perhaps the Minister’s Department could look at clawing back some of the money that Invest NI gave to Visteon over the years. We should send out a clear message of support for the workers in the Ford Visteon plant in west Belfast in the hope that the administrators will call off their attempt to remove them. Dialogue is the only way forward in this case, and Sinn Féin urges that.

Gerry Adams MP, along with other colleagues and the Minister, met the Visteon employees to discuss the situation at the plant. That situation is a massive blow to west Belfast and other areas. However, it is easier to sustain existing jobs than to create new ones. On that basis, what is the Minister’s Department doing to sustain existing jobs and create new jobs? Go raibh maith agat.

Photo of Arlene Foster Arlene Foster DUP

I hear what the Member says about the administrators at Visteon, and I agree that dialogue is the way to sort out those difficulties. He referred to clawback: Invest NI provided Visteon with financial assistance in 2003 for the development of a fuel rail, and of that offer, £97,210 was paid. In that instance, the letter of offer contained clauses to protect our investment, and clawback will be invoked if we feel that there is a need for it. Having looked at the situation briefly, it appears that that will be the case.

As regards what the Department is doing to sustain jobs, I hope that the Member understands that my talks with the Minister for Employment and Learning are based on practical issues, and on supporting economically viable firms that may not be able to sustain jobs in the short term. I hope that we will able to do something about that in the short term.

We will continue to look for new jobs and new foreign direct investment (FDI). I met Invest NI international staff this morning in Belfast and I told them that this is a good place in which to do business because of our skills levels and our people. We still need investment from abroad, and there is a need to go out and sell Northern Ireland as a place to invest in. Although I totally agree with the Member about sustaining jobs, there is also a need to look for new FDI.

Photo of Ken Robinson Ken Robinson UUP

I thank the Minister for her replies up to now. She will recall that I have spoken to her and written to her, and to Sir Reg Empey, expressing my concerns about looming job losses. Unfortunately, we are now dealing with real job losses. Retraining and upskilling will work in some instances, but the approach of some employers has been less than helpful, and we heard about examples of that from other Members. What can the Minister and the Executive do to continue to pursue management to ensure not only that they respond to the positive moves that she is making through the Executive, but to value the work, skill and loyalty that has been put in over the years by existing workforces?

We must retain those workforces; we must ensure that firms survive the economic downturn and that the workforce is there to give the Northern Ireland economy the lift that it is going to need at some point in the future. Will the Minister assure the House that those issues are being considered and will be addressed?

Photo of Arlene Foster Arlene Foster DUP

I thank the Member for his question. He is absolutely right; there is only so much that Government can do. I hope that Sir Reg Empey and I will be able to offer packages in the near future, but employers must play their part and, as part of those packages, offer retraining and reskilling to their staff.

That is a big commitment for them. However, indigenous employers in particular have told me that they want to retain their staff. William Wright of Wrightbus said that the redundancies that he announced some time ago were the first that he had ever had to make. That is a big wrench for someone of his standing.

We will certainly work with employers. We will tell them that they have a responsibility to the community — as I said, most of them take that responsibility seriously — and that we want them to work with the Executive so that we can keep people in their jobs in the short term. By doing so, those firms will be ready when the upturn comes, in the medium to long term. In fact, this represents an opportunity for employers to provide their staff with new skills and training, and we hope that they will see it as such.

Photo of Séan Neeson Séan Neeson Alliance

I thank the Minister for her reply, and I acknowledge her efforts in dealing with the problems that have arisen. As the Minister knows, many of the people whom the job losses have affected live in east Antrim. I, therefore, have a personal interest in what is happening.

First, is the Minister satisfied with all the work that Invest NI is doing to deal with the problem? Secondly, can more be done to assist research and development, the creation of new products and the development of further overseas markets?

Photo of Arlene Foster Arlene Foster DUP

I am glad that the Member mentioned a number of issues. He is absolutely right: we need to raise a number of issues with those firms. That is exactly what we are doing with companies such as FG Wilson. Invest NI has engaged with FG Wilson on training and on new research and development initiatives, and to help it to find new markets for its goods. That is the type of work that we are doing with those companies.

FG Wilson is considering a number of offers of R&D support, and we hope that we will have several R&D projects with the company in the near future. That demonstrates FG Wilson’s willingness to do work in Northern Ireland and its commitment to Northern Ireland, which it spoke about in the press today. I have no doubt that it wants to keep its staff in place, as do the other companies, apart from Visteon. Bombardier Shorts and Nortel are here for the long term, and we want to work with them to ensure that they can stay for the long term.

Photo of Dawn Purvis Dawn Purvis PUP

I thank the Minister for her answers so far. I also thank her for her focus on securing and developing the manufacturing base in Northern Ireland. More than 2,000 job losses have been announced in the past month, the majority of which are from companies in my constituency, including Bombardier Shorts and Hughes Christensen.

First, what use is being made of the EU globalisation fund to reskill and retrain those people who face redundancy? Secondly, apart from clawback, will the Minister clarify what lessons can be learned about the investment money that Invest NI gave to firms for research and development? Products that are researched and developed in Northern Ireland should also be produced here, and not moved out by companies, a point to which other Members referred.

Photo of Arlene Foster Arlene Foster DUP

The latter issue is a difficult one, because it is only when a company moves research and development to another country that one realises that is what exactly it was planning to do. However, we will continue to apply due-diligence tests to the amount of money that we give to those companies in order to ensure that they remain in Northern Ireland.

Concerns have been raised with me about the use of research and development money in Visteon, and the fact that that money went to South Africa to develop a product that is now being used there. Obviously, that is of great concern to us, and we will pursue clawback, if that is the procedure that we need to use.

We have looked into whether we can avail ourselves of the EU globalisation fund. Unfortunately, however, the scale of the job losses in Northern Ireland is not huge in European terms.

Such job losses are not considered huge in European terms: that would entail the loss of tens of thousands as opposed to thousands of jobs. We have looked at the EU globalisation adjustment fund, but I am afraid that it does not appear that we can avail of it. That is not to say that we will not continue to engage with Europe.

Earlier, the Chairperson of the Committee for Enterprise, Trade and Investment said that we should consider relaxing some state-aid rules. We are doing that, and I apologise for not responding to that earlier. We are engaging with Europe and are looking at ways in which we can be more creative with our schemes, and we hope to be able to say something about that in the near future.