Courtaulds (Hansard, 13 December 1976)

§ 14. Mr. Hoyle
asked the Secretary of State for Industry whether he will now set up a Government inquiry into Courtaulds.

§ Mr. Varley
My right hon. Friend the Secretary of State for Employment and I are still in discussion with the company and the unions concerned about the recently announced closures at Courtaulds, including the possible basis for an inquiry. Meanwhile I understand that the company has invited the Courtaulds trade unions co-ordinating committee to meet it.

§ Mr. Hoyle
Does my right hon. Friend agree that there is a need for a public inquiry when a firm, on its own admission, has received £40 million in Government grants of one kind and another in the past three years and yet when it faces the slightest difficulty moves out of a 955 development area and gives only 24 hours' notice to the trade unions concerned? Does not that show once more the need for the Government to take equity in firms which seek this aid and also the need for compulsory planning agreements?

§ Mr. Varley
I have made plain on more than one occasion how disturbed I was about the decision to announce closures and the nature of the closures. As I have already said, my right hon. Friend the Secretary of State for Employment and I are to discuss the matter further with the Courtaulds management. An important development over the past few days has been the decision of the Courtaulds management to discuss further the closure programme with the trade unions co-ordinating committee. I do not think that I want to go further at this stage.

§ Mr. Fletcher-Cooke
If any inquiry is ever launched into this matter, will the right hon. Gentleman ensure that it probes to see what inducements and pressures were brought by the Government of the day upon Courtaulds to develop not in the traditional weaving area of North-East Lancashire, as the company wished, but in a wholly untried new town?

§ Mr. Varley
It is part of Government regional policy to encourage expansion to go into areas of high unemployment. I do not think that as a policy that has generally been disputed across the Floor of the House. I am disturbed that the Courtaulds factory at Skelmersdale in particular has not been the success that it was originally thought it would be, but Courtaulds will discuss the matter further with the trade unions concerned, and I think that that is a good development.

§ Sir A. Meyer
Is the right hon. Gentleman aware that the threatened closure of the Castle Works in Flint will impose a catastrophe even greater in its effect on the local employment situation than that threatened in Lancashire? The workers at that factory are convinced that at the last minute the Government will pull something out of the hat and guarantee their future. Is their confidence well placed?

§ Mr. Varley
Again, I know that the Courtaulds management is discussing the 956 situation at the Castle Works in Flint with the trade union mainly responsible, the TGWU. I do not know the latest developments there, but we very much regret the closures that have taken place. Some are due to bad operations, as in Skelmersdale. Some are due to the effects of the market. Courtaulds is a valuable employer of labour throughout the country and while, as my hon. Friend the Member for Nelson and Colne (Mr. Hoyle) said, the company has received Government grants totalling £40 million from 1973 to date, it has contributed a great deal of its own resources to this development, and I think that it has to be looked at like that. I hope that the discussions over the next few days will bring about some hope for those who work at these factories.

§ Mr. Biffen
The right hon. Gentleman referred to factors that led to the lack of success of the Skelmersdale enterprise by Courtaulds. Will he say what he thinks were those major factors?

§ Mr. Varley
Some of those factors—not all of them—relate to industrial relations, and Courtaulds, on its own admission, takes some of the blame as management. I hope that the meetings with the co-ordinating committee will go into the matter even further. If an inquiry is set up as suggested by my hon. Friend, I think that the terms of reference should include all relevant factors and they should be brought to light.

§ Mr. Madden
Will my right hon. Friend give an assurance that every consideration will be given by his Department to any application to establish a worker co-operative within Courtaulds and, indeed, within any other textile plant that is acquired by a company and then is said to be in a position of not having long-term viability? Will my right hon. Friend consider most carefully any applications and destroy any suspicion that there is a reluctance within the Department of Industry to support worker co-operatives within the textile industry?

§ Mr. Varley
Under the 1972 Industry Act I am required to consider any proposals that come to the Department. If proposals come from textile companies or from workers, they will be considered in the light of that legislation.