Vickers: Tank Factory Job Losses (Hansard, 22 October 1998)

§ Lord McIntosh of Haringey
My Lords, job losses are always regrettable. It is very sad that Vickers has been unable to sustain its current workforce in Leeds, especially as it has had a long association with the city. I am therefore pleased that the Government Office for Yorkshire and Humber has announced that it is establishing a rapid response unit to bring together the city council, the Leeds training and 1559 enterprise council, the Employment Service and the company to ensure that every possible help with retraining and redeployment is available. I am sure that the skills of these employees will prove attractive to other employers. This help is in addition to the out-placement services which Vickers will offer to all staff who are made redundant.

§ Lord Calverley
My Lords I thank the Minister for his reply. But is he aware that the Strategic Defence Review of 11th July this year stated that, substantial work [is assured] … for the next three years"? Just two months later these cuts were announced. Does he agree with the Governor of the Bank of England that this is an acceptable price to pay?

§ Lord McIntosh of Haringey
My Lords, the Strategic Defence Review provided a clear basis for the aerospace and defence industries to plan for the future. That does not mean that every single job at every single location is automatically protected.
As to the noble Lord's second question, I have to remind him that the Governor of the Bank of England is not a Minister of the Crown, unlike the previous Chancellor of the Exchequer who said that unemployment was a price worth paying. If the noble Lord looks at the Governor's remarks as reported in the Newcastle newspaper, The Journal, he will see that he said: My anxiety is to try to keep unemployment lower than it has been in earlier phases of slowdown and earlier phases of recession. I am very hopeful that any rise in unemployment that we will see will be nothing like the kinds of rises we have seen in the past".

§ Lord Merlyn-Rees
My Lords, we know in Leeds why there is a decline in the number of tanks needed by the Army. We understand and confirm the steps that have been taken by the local authority. In Leeds we do not have the incentives that are offered in other parts of the country to attract new industry into the area. Given what has happened at Vickers, formerly Barnbow and the ROF, which has provided work in Leeds for many decades, we should look again at possible incentives to bring work back to that part of Leeds.

§ Lord McIntosh of Haringey
My Lords, I cannot deny what my noble friend said about incentives. The economy in Leeds is diverse and buoyant. Leeds is one of the fastest growing cities in Europe. We recognise that there are areas of severe deprivation in Leeds and for that reason the Government are investing over £60 million in the city through the single regeneration budget up to and including the year 2004–2005.

§ Lord Vivian
My Lords, can the Minister assure the House that the proposed reduction in the number of workers at the Vickers factory will not affect the numbers and times of issue of Challenger 2 tanks to our armed forces?

§ Lord McIntosh of Haringey
My Lords, Vickers, rather than the Government, is responsible for meeting 1560 its contractual obligations to government. I understand that it made its decisions as to its workforce in Leeds for commercial reasons. I have no reason to suppose that it is putting its contractual obligations at any risk.

§ Lord Dean of Beswick
My Lords, does the Minister accept that, though the number of those who will lose their jobs in Leeds—namely, 450—is a lot fewer than the losses predicted at Rover, it is as big a blow to every man who loses his job in Leeds and to his family as it would be to anyone working in the car industry? Can the Minister assure us that the Government will treat this issue as seriously as that in relation to Rover?

§ Lord McIntosh of Haringey
My Lords, my noble friend is right. Every time a job is lost in engineering, whether it is in cars or defence manufacturing, ancillary jobs of suppliers are also at risk. That is why I said in my first Answer that a rapid response unit was being set up to tackle problems of that kind. That does not gainsay the fact that my noble friend is right. Job losses are serious for the economy and a tragedy for those involved.

§ Lord Gillmore of Thamesfield
My Lords, I should first declare an interest as a non-executive director of Vickers. Does the Minister accept that the job losses at Leeds would have been far greater had not the company decided to use about half the existing site to establish a centre of excellence for the maintenance, re-equipment and support of the tanks now in service with the British Army?

§ Lord McIntosh of Haringey
My Lords, with the greatest respect, I am not sure that a non-executive Director of Vickers should be asking questions about that matter in this House. These matters are for Vickers, not the Government.

§ Lord Burnham
My Lords, is it not the case that at present we have a substantial number of the heavy tanks in which Vickers has specialised? Is it not also the case that the need is for a lighter and different type of armoured fighting vehicle and that so far Vickers has proved unable to succeed in competition for contracts to produce such a vehicle on which it should now be advised to concentrate?

§ Lord McIntosh of Haringey
My Lords, I do not think it is for the Government to advise Vickers as to what type of vehicle it should concentrate on. It must make commercial decisions. What the Government can do, and have done, is to try to set out as clearly as possible for a number of years ahead their defence strategy and, therefore, the procurement policies which follow from that.