§ Motion made, and Question proposed,That this House do now adjourn.—[[Mr. Brooke.]
§ 3.9 am
§ Mr. William McKelvey (Kilmarnock)
When I applied for this debate it never crossed my mind that it would take place at 3.9 am. Nevertheless, that does not detract from the importance of what I have to say, and it is important to me and to my Labour colleagues in Ayrshire, my hon. Friends the Members for Central Ayrshire (Mr. Lambie) and South Ayrshire (Mr. Foulkes), that we ensure that the record is kept straight and that the history of the events surrounding the occupation of the Wallacetown foundry is recorded in Hansard.
I should like to give the House a brief history of how the occupation came about. The Wallacetown foundry is a subsidiary of Simplex General Electric and has been completely owned by the multinational General Electric America since January 1980. The foundry is part of the Simplex electrical division and is one of three main factories, the others being situated in Brighton and Blythe Bridge. The foundry produces sophisticated electrical equipment, including specialist switchgear for the National Coal Board.
In May last year the employees at Wallacetown were engaged, through their union the AUEW, in the annual round of wage talks. At that time, there were 765 employees. During the wage discussions, the management intimated to the trade union that there were to be redundancies, and a notice of intent was issued. That is not a unique feature in negotiations between managements and trade unions, but it is worth noting that that pressure was applied on union representatives while wage negotiations were taking place.
The union did not oppose the redundancies and enough volunteers came forward to satisfy the management's requirements. The work force was reduced to 678.
The company has been profitable since 1975. Its main customer has been the NCB, and in 1981 more than two-thirds of sales went to the board, totalling about £12 million—a substantial order. The order book at the end of March this year was 2 per cent. above the expected level. The work force has co-operated over the past two years in achieving complete flexibility and there has been a good record of industrial relations. There seemed to be no great problems in that area.
It came as a big surprise to me, my hon. Friends from Ayrshire, the Secretary of State for Scotland, in whose constituency the foundry is located, and the Under-Secretary of State for Scotland that the developments that I am about to outline happened as quickly as they did.
During this year's round of wage negotiations, on the anniversary of the previous redundancies, the management again announced while the trade union was discussing wages that there were to be redundancies. The union had thought that that device might be used, but there was a sinister change in the application of the managerial technique, which took the form of the management arguing that it could not see that the number of volunteers who might have come forward would satisfy the management's requirements and they were, therefore, calling for compulsory redundancies.
As the foundry is under the convenorship of the engineering union, it is important for the House to know 922 that at national level the AUEW does not accept a policy of compulsory redundancy. However, the management of the firm was aware of that. During the discussions with the shop stewards in which some 14 volunteers had come forward, the management rejected 11 of those and broke the normal negotiating pattern by issuing a list naming those who were to be made redundant. To the dismay of the workers, the shop stewards convenor, Alex Baird, appeared at the top of the list. He is a man who is much respected by workers in the factory and by trade union members in the Ayrshire district. He sits on the district committee of the AUEW.
It became patently clear to the workers of that firm that in seeking the redundancy the management were using it as an excuse to neutralise an effective leader of an effective trade union organisation. The workers felt that the management should withdraw the list. The management refused, and the workers unanimously decided that they should occupy the factory—a technique that has become somewhat commonplace in the difficult industrial relations in Scotland at the moment. On 1 May—an appropriate day—the workers occupied the factory. They have occupied it since, and are still in occupation.
At the divisional level, through the good offices of Willie Aitken, the trade union managed to have some informal discussion with the management yesterday which lasted some seven hours. At the end of that seven hours, I regret to say, the management was intransigent in its attitude to the list. The redundancy hit list was to remain and the workers said that they would stand firm and that the occupation of the factory would continue.
We see in Ayrshire an extremely serious development. First, the firm has previously had a good record of industrial relations. We see a changing pattern which we imagine is the influence of the multinational General Electric. There is certainly a feeling abroad in the factory that there is more to this redundancy operation than meets the eye. Perhaps the Minister will have some answers to my questions.
My hon. Friends the Members for South Ayrshire and Central Ayrshire will have points that they wish to underline and amplify if they catch your eye, Mr. Deputy Speaker. Before replying to some of my questions, the Minister should consider first that I and my hon. Friends are completely committed to support the workers in their action. Secondly, the AUEW national policy will be to support the workers who are fighting the management's compulsory redundancies.
Since the management was bound to know that the AUEW's national policy would be to resist with the maximum use of whatever force was available to it—it must have known—why did it continue with this line? Can it be, as some of the workers have asked us, that it has jumped the gun in introducing its "get tough" policy, prior to the Employment Bill becoming law. That is now so infamous in Ayrshire as to be referred to as the Tebbit Bill. If it has jumped the gun it is an extremely dangerous ploy. Why is it continuing? What effect will the loss of production have on the National Coal Board? What is the commitment of General Electric to the Ayrshire plant? Does it want to continue it in existence or is it possible that the Ayrshire plant is to be put up for sale? If that is the case, and the General Electric company is disposing of its 923 firms in the electrical division, would it be more profitable to neuter a trade union organisation within it so that it might appear more attractive to a potential buyer?
Those are the questions that the workers are asking us. They are convinced that the root of the matter is an anti-trade union move by the firm to remove an effective, efficient shop steward. I pose those questions to the Minister in the hope that he has an opportunity to answer them.
§ Mr. George Foulkes (South Ayrshire)
I am grateful to my hon. Friend the Member for Kilmarnock (Mr. McKelvey) and to the Minister for the opportunity to intervene in support of my hon. Friend. My constituency is seriously affected because a number of my constituents work at Wallacetown. It is an important source of employment because it is the type of industry one would expect to spearhead the industrial revival about which we hear from the Under-Secretary. It has had a good record of industrial relations until recently, and I ask the Minister to speculate as to why matters have deteriorated over the past few years. Is the management muscle flexing? Is it part of the United States management style because of the General Electric company involvement, or is it the effect of the encouragement that the Government are giving to some managements to be more belligerent with their trade unions? If that is the case it is a sorry example that we find at Wallacetown.
As my hon. Friend said, last year during the wage negotiations redunancies were announced. Two months ago I went out of my way to see Jim Pickering because I was worried about potential redundancies. I was assured by him that no redundancies were envisaged for at least six months. I was rather surprised and somewhat annoyed and disappointed when 40 redundancies were announced a couple of weeks ago.
Again, it was during the wage negotiations, but this time the difference was, as my hon. Friend said, the victims were named. I used the word "victims" advisedly. It was no surprise to some people that the chief shop steward was included. The Minister must not underestimate the workers' great respect for Alec Baird. They are 100 per cent. behind him. He showed that he could not be bought off on a previous occasion. He is an effective advocate for the men he represents. That is why my hon. Friend and I are suspicious that something fishy is up. Wallacetown is the only visible plant which Simplex General Electric has in its electrical division. It may be hiving it off. It may have some plans for it that it is not divulging. It wants to soften up resistance in advance by getting rid of the person most able to fight anything that would be detrimental to the workers.
If the Minister knows what is up he should come clean. The management knows what is up and it should come clean. As my hon. Friend said, he, my hon. Friend the Member for Central Ayrshire (Mr. Lambie) and I support the work force wholeheartedly. The present occupation is entirely the result of heavy handed management. I have respect for some—but not all—of the managers involved. There is no doubt that if the management has the sense to withdraw the hit list and to agree to voluntary redundancies—which would go a good way towards achieving the management's aims—the occupation would cease.
924 I ask the Minister and, in particular, the Secretary of State for Scotland to urge the management to think again. They have the power of Government and can influence the management. I ask them to urge the management to reconsider the matter so that the men at Wallacetown can get down to the work that they do so well. Our country needs the talent and expertise of such workers.
§ The Under-Secretary of State for Scotland (Mr. Alexander Fletcher)
My right hon. Friend the Secretary of State and I are as concerned as the hon. Members for Kilmarnock (Mr. McKelvey) and South Ayrshire (Mr. Foulkes) about the additional redundancies that the company is now being forced to seek. Redundancies and job losses are always a serious matter. It is a particular matter of regret to my right hon. Friend, because the company is in his constituency of Ayr and many of the workers involved are his constituents.
However, we are even more deeply concerned that the sit-in might put at risk investment decisions and future plans for the company. We have kept closely in touch with the situation at Wallacetown throughout the past few weeks. On 26 April, my right hon. Friend met the managing director to discuss the situation and that was just prior to the start of the sit-in. As a result of the sit-in the situation has become much more serious and we have been in frequent touch with the company during the past week to assess the position.
Following the meeting that my right hon. Friend and I had on Tuesday with the hon. Member for Kilmarnock and his colleagues, we passed their points on to the managment. Obviously it was right to do that. However, that is a far cry from interfering in the direct negotiations that are taking place between management and workers. Indeed, they can only take place between management and workers. I cannot see that the dispute will be assisted by raising the matter in the House tonight. I have no objection to responding to the points raised, but a dispute that can be settled—in any factory—only through the agreed procedures is not helped by such a debate.
In such situations, it is easy to make judgements a; an outsider and to level criticism, but that is counterproductive. In the first place, management must be left to manage. The hon. Member for Kilmarnock will not dispute that. In the second place, negotiations must be between management and the work force and the representatives. They are the people who will have to live with the decisions that they make and they have a shared interest in achieving an outcome. For any of us to seek to interfere in that process—particularly in such a delicate situation—would be highly risky, and might be irresponsible.
§ Mr. McKelvey
Of course, we accept that management has the right to manage, but it does not have the right to mismanage, particularly when unemployment in Ayrshire fluctuates between just below and just above 20 per cent. That is why we have raised this matter. We are seriously worried that this issue could develop and spread.
§ Mr. Fletcher
That is all the more reason for management and unions sticking closely to agreed procedures when attempting to settle such a dispute. I cannot imagine that there is anything in the agreed procedures that requires a dispute that management and 925 workers are trying to settle to be raised in the House or that requires interference from Members of Parliament or Ministers at this stage. Despite our interest in the matter and our concern about the unemployment rates, the last thing that we want to do is to lecture the company or its workers on how to conduct their affairs.
My information, incidentally, is that the procedures are not being followed and that there is a dispute about procedures in the company. If hon. Members have any influence with the workers, I hope that they will do their utmost to persuade them to stick to the negotiating procedures that have been agreed and practiced over the years. I understand that informal discussions have been taking place involving the employers Federation and full-time union officials aimed at getting proper discussions with agreed procedures under way between management and union representatives at the factory. Every effort should be bent in that direction.
In my capacity as industry Minister in Scotland, part of my job is to see that promotional tours are undertaken and investment encouraged to come to Scotland. I listened with interest to the hon. Gentleman's criticism of multinational companies. In Scotland generally, we are very happy to have a number of highly successful multinational companies creating many thousands of jobs, bringing the latest technology to Scotland and providing great opportunities not just for their employees but for subcontractors and others involved in Scottish industry generally.
Attracting investment to Ayrshire and other parts of Scotland requires the maintenance of the best possible industrial relations record. As I said earlier, the investment decisions and the future of the plant are affected by a dispute of this kind. As I think I advised hon. Members informally, until recently the Department has been involved with the company, not with a view to any takeover or any rubbing of noses into the ground because of trade union legislation. On the contrary, my Department has been involved with the company in the consideration of Government grant for an expansion project which would create more jobs. That is now on the shelf, following the sit-in.
In my view, a sit-in is the worst kind of industrial dispute. From the point of view of bad publicity, it is worse than a strike. I know that sit-ins have become fashionable and one or two of them may have achieved some success as a result of the publicity, but I would say to any work force contemplating such action that it is easier to obtain notoriety than good publicity in such a situation. Moreover, the publicity is not confined to the dispute itself or to the company. It contaminates industrial reputations in the area and in the country generally. We all have a great interest in trying to avoid that.
As I understand it, because proper procedures have not been followed, there is now a sit-in. From what the hon. Gentleman has said, there seems little hope of a settlement at this stage. I hope, therefore, that when he and his hon. Friend the Member for South Ayrshire talk about giving full support to the workers they will do so objectively, with a view not just to taking sides but to finding a solution to the dispute and to the problems faced by the workers themselves and the damage that they may do to their own 926 job prospects if they are not prepared to deal with the problem in the correct manner through proper negotiating machinery with the management.
§ Mr. Foulkes
I assure the Minister that my hon. Friends the Members for Kilmarnock and Central Ayrshire (Mr. Lambie) and I are prepared to say to the workers that they should end their occupation and get back to work on the clear condition that the management withdraws not the redundancies—let it keep the redundancies, however regrettable they are in an area of high unemployment—but the hit list of compulsory redundancies. That is a simple request. If the Minister and his colleagues are willing to ask the management to do that simple thing, we in turn will ask the men to end their occupation so that they can get back to work.
I hope that the Minister will give the assurance that I ask of him, just as we have now given the assurance that he asked of us.
§ Mr. Fletcher
The information that I have about the so-called hit list is that the management has not been asked to withdraw the list of names. On the outside looking in on such disputes, hon. Members on both sides of the House must ensure that they are fully aware of all the facts and the problems. Frankly, I do not see how we can be fully aware, sitting here in Westminster. It is extremely dangerous to pass judgment on the matter, and the best thing that we can do is to urge the management and the workers to stick to the agreed negotiating procedures in trying to find a solution to their problem.
I have already referred to the fact that the new investment about which the company talked is currently on ice because of the present position. I hope that it can be revived, but clearly it will not help the reputation of the holding company, General Electric of America, if the position is reported, as it must be because the sit-in is in its second week. That cannot be good news for investment plans, because such a large company or any other multinational always has a choice of locations for investment. We should remember also the risk that was taken with Wallacetown and the fact that it has been characterised as having a stable work force. Until this dispute, it had a strike-free record that was second to none in the United Kingdom group of companies. That is the message that we wish to get across to investors at home and abroad. I hope that this is a one-off position that will soon be resolved.
It does not help the position not just to try to solve the problem from a distance but to indulge in kite flying or even spreading rumours about plans for a takeover or for repression of the work force and trade unions. Those were the sort of noises made by the hon. Member for South Ayrshire a few moments ago. They are not justified. I have no information other than that the company wishes to pursue its business in Ayr in the best possible way and seeks the full co-operation of the work force. The hon. Member for South Ayrshire and the hon. Member for Kilmarnock should try, like my right hon. Friend and I, to encourage management and workers to resolve the dispute. The ball is firmly in their court. They are adults and they know the problem better than hon. Members or me. The best message that we can give them tonight is that they should sit down together and resolve their differences.
§ Mr. McKelvey
I assure the Minister that the information that came directly from the shop stewards' convenor and from the divisional organiser of the AUEW to us as Members of Parliament was that if the firm were to withdraw its list of names and return to negotiations on the question of redundancies—on who was to go—the dispute would be over instantly. That is the fact that will be recorded in Hansard.
§ Mr. Fletcher
It can be recorded in Hansard, to which one has no objection. If it is recorded in Hansard 100 times, it is no substitute for the fact that workers and management must sit down and resolve the dispute. I hope that that will be the case first thing tomorrow morning.
§ Question put and agreed to.
§ Adjourned accordingly at twenty-two minutes to Four o'clock am.