HL Deb 16 May 1985 vol 463 cc1271-6

4.38 p.m.

Lord Brabazon of Tara

My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer which has been given to a Private Notice Question in another place on the announcement of job losses in British Rail Engineering Limited. The Answer is as follows:

"At a meeting of their Joint Consultative Committee on 15th May, the management of British Rail Engineering Ltd. informed the unions that they had reluctantly come to the conclusion that it would be necessary to make further reductions in manpower within BREL.

"A year ago the management had already informed the unions at the equivalent meeting of proposed reductions. Their latest evaluation of workload, however, shows a futher reduction of 13 per cent. in repair work. The company has therefore concluded that they need to reduce manpower by a further 1,300 over the next two years.

"It may be helpful to the House if I explain these workload projections, Mr. Speaker. The demand for railway repair and maintenance has declined because of BR's decisions to invest in new rolling stock. In particular, investment in new diesel multiple units with higher performance means that the same frequency of services can now be provided with fewer trains; and each of those fewer units requires less maintenance. Major programmes of refurbishment, particularly the stripping of asbestos from older vehicles, are also nearing completion. This has been a significant part of the recent workload.

"In the light of this reduced demand, BR and BREL have, with considerable regret, decided that they must propose to the unions a sizeable rundown of the Glasgow Springburn Works and some further manpower reductions at other works, particularly Doncaster and Eastleigh. Most regrettably of all, they have decided, after considering the position carefully, that there is insufficent work to maintain the BREL works at Swindon after March 1986.

"Mr. Speaker, I know these proposals will be a hard blow to the communities concerned particularly to Swindon. But British Rail and BREL have considered the matter carefully and concluded that a reduction of capacity on this scale is unavoidable. There will, of course, be an opportunity for all the possibilities to be re-examined fully in the consultations with the employees that now follow BREL's announcement.

"BR and BREL will do all that they can to find alternative work for redundant employees by offering opportunities to transfer to other works, and by encouraging business development and job creation at both Swindon and Glasgow."

My Lords, that concludes the Statement.

Lord Carmichael of Kelvingrove

My Lords, I wish to thank the Minister for repeating in the form of a Statement the Answer to the Private Notice Question. I am sure that the House will realise that it is a serious Statement for a number of old, well established railway communities, particularly that of Swindon, which has a long tradition of railway work, as well as my own town of Glasgow, where the Springburn works have been building and maintaining railway rolling stock for more than 120 years, and where railway work is an absolutely vital part of the community. It was built with the railways, and this is a sad day.

Is the Minister aware that the announcement shows an acceleration of the loss of jobs which British Rail Engineering said would take place over a 10-year period? Only last May they said that 1,700 jobs would go at Swindon and 900 at Springburn. This was bad enough, but now Swindon is to close entirely and Springburn is to be reduced to a mere 460, which must mean that the people remaining at Springburn will be very anxious about whether or not they have any future.

We all recognise the impact of technological change, but the Government, as well as the industry, have a duty to prepare for the new situation arising from this change. The question must be: are the Government taking this responsibility seriously? With regard to the freight loco replacement plan—I raised this earlier with the Minister in another context—the British Rail Board are believed to have put out tenders for prototype models of the new freight locos. I understand that tender offers have gone to seven companies, mainly foreign. Applications are expected back in the winter, and the models should arrive by 1987. Although there are only small batches up for tender just now, the company which wins the tender will have entry into a large market, producing a large number of locomotives, about 750 over the next 25 years.

Does the Minister really believe that other Governments would allow overseas penetration in a field such as this if they had the skills of design and manufacture that we undoubtedly have in these old workshops? I believe that the other countries would give their indigenous industry the breathing space if needed, including in many cases allowing temporary protection to the firms to meet the new challenges. Can the Minister tell the House whether any such help has been offered to British Rail Engineering in respect of the new freight locomotives?

Lord Harris of Greenwich

My Lords, I thank the Minister for repeating the Statement to this House. May I ask him two questions? First, would he not agree that there is bound to be increasing public concern that this proposal will not only damage the West of Scotland, as the noble Lord, Lord Carmichael, has pointed out, but will also do devastating damage to the town of Swindon? It represents a further run-down of our productive capacity in this country at a time when increasing public concern is being expressed by many leading figures in business and industry as to the scale of what has been happening.

In the light of that situation I should like to ask two questions. First, given the fact that there are suggestions that substantial orders are going to be placed by British Rail in the United States, is there not now some urgent need to reconsider that position to see whether it is possible that work of this kind can be put out for tendering within the United Kingdom? Secondly, the Minister referred to British Rail's desire to consider certain job creation possibilities in Swindon and elsewhere. What specifically does this mean? Does it mean, for instance, that British Rail will repeat the example of British Steel and set up a wholly-owned subsidiary like British Steel Industries to create employment opportunities for small businessmen, people who are prepared to start businesses of their own within the supportive environment of a company such as British Steel Industries? Can not that be done in Swindon and elsewhere? Can we have an assurance from the noble Lord that it will be done?

Lord Brabazon of Tara

My Lords, I thank both noble Lords for their reception of the Statement. Perhaps I may first answer the last question concerning the possibilities of job creation in both Swindon and Glasgow. In Swindon British Rail have set up a company called Swindon Holdings to develop redundant parts of the work site. They are already working on the east side of the works. They are studying a consultant's report on the scope for redevelopment potential for industrial and housing use and are aiming to set up a managed workshop by the end of the year. In February they announced that £750,000 was initially available for alternative employment, and in view of yesterday's announcement that figure could be raised.

In Glasgow they have made £500,000 available through discussions with the local enterprise agency, Glasgow Opportunities, and they hope to finalise a package there to assist in finding new employment. Again, in view of yesterday's announcement that figure will probably have to rise.

The noble Lords, Lord Carmichael and Lord Hams of Greenwich, both asked me about the possibility of future orders for locomotives going overseas. Perhaps I may remind both noble Lords that neither Swindon nor Glasgow was actually engaged in the manufacture of locomotives; they were engaged in the maintenance of locomotives.

One reason this sad decision has had to be made is to enable British Rail Engineering to become more competitive and tender for work of this sort, whether in whole manufacture or in part contracts. Any suggestion that we are definitely going to order locomotives from the United States is quite wrong. No such decision has been made. Certainly we hope that many United Kingdom companies will tender, and tender successfully, for these orders.

Lord Shinwell

My Lords, we have been frequently told by Members of the Government that one of the causes of increased unemployment is inflation in wage rates; that is to say, wages go up and as a result unemployment is caused. Are we to believe that that applies in this particular instance, where so far as British Rail are concerned they close down their workshops and there is a loss of orders which has nothing at all to do with wage rates?

If I am right in my observations and in recalling what Government spokesmen have said, what is going to be done about this increase in unemployment? It goes on all over the place. The effect on a place such as Swindon must be disastrous. There have already been considerable reductions in the workforce in that area. For this to happen now will affect not only those associated with British Rail but also shopkeepers. A vast variety of people engaged in trade are concerned. The effects will be far too widespread for this to be allowed to happen without something being done.

Surely in these circumstances the time has arrived to consider whether we cannot engage in a constructive effort to deal with matters that have not been attended to for many years, either because the costs of the equipment were excessive or because it was thought that merely to provide additional equipment for sewers, drainage and the like would not provide more employment. It is a matter of judgment, a matter of opinion. In these circumstances, what is to be done about it? Or is nothing to be done about it?

Lord Brabazon of Tara

My Lords, first I should explain to the noble Lord, Lord Shinwell, that the reason for these sad closures is largely, as I hoped I had explained, the increase in efficiency of the new rolling stock. For every three old-style trains which British Rail used they now need only two of the new diesel multiple units; and each new diesel multiple unit requires 30 per cent. to 40 per cent. less maintenance than the present rolling stock. All that adds up to approximately half the work that needed to be done before. The noble Lord asked me what we were doing to help create extra jobs in these areas. I have tried to answer that in my previous replies.

Lord Stoddart of Swindon

My Lords, is the noble Lord aware that I had the honour to represent Swindon for a long period of time? The news that Swindon works is to close has come as a devastating blow to me as it has to the people of Swindon. Is he further aware that this year the town will celebrate the 150th anniversary of the opening of Swindon works? Tens of thousands of visitors from all over Britain will go through the Swindon works only to be told that there will be no 151st anniversary. That is terribly sad, and I hope the Minister agrees. That is another part of our heritage which has been destroyed by present policy.

Is the Minister further aware that the workers at Swindon railway works have co-operated over a long period of time and have improved productivity several-fold? They now feel betrayed and kicked in the teeth by a Government who appear not to care about the railway system and by a Prime Minister who unfortunately refuses to travel in a British train. Does the noble Lord realise that throughout this country we have much clapped-out rolling stock and a lot of clapped-out railway equipment, particularly in the south-east commuter belt? Does he realise that if a really good effort were made to replace all this stock there would be adequate work for Swindon and all other railway works where they are to lose men?

Is he further aware that it will be seen as an outrage in Swindon and elsewhere that British Rail could even contemplate buying 1,500 locomotives from abroad? Although he says that Swindon has not built railway engines for some time, it has built them for export. What is more, Swindon and other railway works throughout the country could contribute towards building these railway engines in this country. Indeed, Swindon has and continues to have a part to play in the railway work of this country. I fear that present railway policy and Government policy will ensure that in the future we shall very much regret this decision because we shall be very short of railway engineering capacity.

Lord Brabazon of Tara

My Lords, while I fully recognise the long association of the noble Lord, Lord Stoddart, with Swindon—it is sad that on the occasion of its 150th anniversary this decision had to be made—British Rail carefully considered the options and they concluded that the closure of Swindon was the only sensible option for the overall viability of British Rail Engineering. Each works has special skills, equipment and functions, and on future workload forecasts Swindon could not be guaranteed a sufficient workload to be viable. It was a difficult managment decision for British Rail. We back their judgment and there is no question of Government pressure either way on British Rail.

As for investment in the railways, this Government have a record second to none. Since 1979 we have invested £2½ billion at today's prices. In the last 18 months alone we have approved 12 major projects worth over £580 million. We have approved the electrification of the east coast main line, which is a £306 million investment, and British Rail's corporate plan projects further spending on investment of £2.2 billion over the next five years. I think that record speaks for itself.

Lord Boyd-Carpenter

My Lords, in the light of the understandable emotion of the noble Lord opposite, is it nonetheless fair to say that so far from this situation resulting from having a Government who did not care about the railways, the figures of Government investment which my noble friend on the Front Bench has given show the contrary? Is it not a paradox that it is the greater efficiency obtained as a result of that massive investment that has caused this situation? Is there not great danger for British industry in harking back over 150 years instead of seeking to grasp the opportunity which modern technology, backed by massive investment, can bring about?

Lord Brabazon of Tara

My Lords, I quite agree with my noble friend. That is why British Rail Engineering has had to make these difficult decisions to be able to compete in both the home and export markets in years to come.

Baroness Phillips

My Lords, is the Minister aware that as a constant customer of British Rail I am completely astonished to learn that it is much more efficient? Last week I made three journeys to totally different parts and in each case there was a breakdown and a delay. That hardly fits in with his description of greater efficiency. It seems to me that we have never been in greater need of these engineering works because not only do we need more locomotives, but we need a much more efficient service. British Rail is in a sad state of decline. Anyone who uses it constantly and compares it with even 10 years ago will know exactly what I mean.

Lord Brabazon of Tara

My Lords, I am sorry that the noble Baroness feels that way. I am afraid that all I can say is that I disagree with her.

Lord Boothby

My Lords, I agree that in the end one cannot stop the march of modern science and modern technology. Nothing can stop it. Men are now being replaced by the machines which they themselves created. That is a situation which will get steadily worse not better, whatever Government are in power. I should like to urge the Government to give some consideration to the problem that, while we have a substantial, very well paid, highly technical pool of workers, we shall soon have at least as large a pool of unemployed with nothing to do because the machines are doing it for them. Can we consider some method by which these young people can be given a life worth living, unconnected with technical production?

Lord Brabazon of Tara

My Lords, the question asked by the noble Lord, Lord Boothby, goes rather wide of the immediate Statement that I have had to make. But I agree with him and, as I said earlier, I hope that what can be done at Swindon and in Glasgow will be successful in providing new employment.

Lord Carmichael of Kelvingrove

My Lords, have any arrangements been made about the possibility of those who work in the workshops in Swindon and Glasgow being offered alternative employment throughout the railway industry as a whole?

Lord Brabazon of Tara

Yes, my Lords, I said that in my original Statement. British Rail would do all it could to find alternative work for redundant employees by offering opportunities to transfer to other works.