Hundreds of jobs are axed by Ford, and we're letting them get away with it

Our current industrial strategy is allowing the company to undermine public trust.

Over 1,400 families are still in shock. Ford’s decision to close plants in Southampton and Dagenham left workers blindsided after almost a century of UK production. At a time of recession, there is a deep concern for the economic wellbeing and material welfare of these workers, as well as many more subcontractors and suppliers. These quality jobs will no longer be available for young Brits. Another nail in the coffin for British manufacturing. The makers are marching straight out of the country.

We are told that it’s inevitable. Of course Ford is now focusing its operations in Turkey. In a brave new world of global competition, this is how we operate. Automobile companies are as cold and sharp as the steel they manufacture; ready to cut and shift production at a moment’s notice. Sympathy is unaffordable. Responsibility and relationship to people and place is naïve. If we want to win the economic war, workers may be collateral damage. The bottom line dictates the show.

But this narrative has masked the deeper failings of Ford and of government. In a meeting earlier this week in Westminster, a little-attended parliamentary debate revealed what is really happening. MPs of all sides dismissed Ford’s behaviour as “shoddy” and “grubby”. The failings of the government’s industrial strategy began to be exposed, and the consequences for the British taxpayer revealed. Three key questions strike to the heart of the problem.

First, why were ministers kept in the dark about Ford’s decision? The business secretary Vince Cable is on record saying he knew nothing about the company's decision to close the plant until just a few days before it was announced. Despite the fact that ministers had 12 meetings with Ford since taking office, Michael Fallon MP said there was “no opportunity to discuss (closures) as we would have liked.”

MPs at a local level went further, claiming they were actively misled by Ford. Alan Whitehead, MP for Southampton Test, said he had received “cast iron” guarantees that local production would continue. Jon Cruddas, MP for Dagenham, said workers were “blindsided” by the decision. Chris Huhne, MP for Eastleigh, called for the minutes of all meetings with Ford to be published from 2008, questioning whether the company gave false impressions of growth to benefit from cheap government loans. John Denham, MP for Southampton Itchen, said that the last communication he had with John Fleming - now head of global manufacturing at Ford - was an email saying that they were planning to increase operations in Southampton.

“Reputations are hard won and easily lost,” says Denham, “I’m sorry to say it will be a long time before MPs will be able to sit down with Ford representatives at the other side of the table and believe they will keep their word.”

Ford insisted they didn’t make their final decision until 19 October – less than a week before ministers were informed - but that doesn’t explain previous assurances.

Second question. Why are British taxpayers supporting Ford’s new line of vehicles outside of the UK? This summer, the European Investment Bank (EIB) gave Ford a cheap £80m loan to develop a new line of transit vans, previously assembled in the UK, in Kocaeli. We part fund the EIB, and our chancellor George Osborne sits on its board. Conservatives themselves were raising concerns about this, including the MP for Romsey and Southampton North, Caroline Nokes:

“Ford globally made $2.2bn profit last year. Why does it need cheap loans to subsidise it to export jobs from the UK to outside the EU?”

Of course Turkey has lower production costs, and its labour costs are one third of those here. But it’s one thing to say it’s cheaper to do business abroad, and quite another to expect British taxpayers to pay for it.

The problems don’t end there. Just a few days before Ford’s announcement, the British people gave some £10m to the company to help it develop a new series of diesel engines here in the UK. This money was awarded by the Regional Growth Fund (RGF), which is chaired by none other than Michael Heseltine – the man recently charged for producing a report for the government on growth. So why didn’t we make this grant contingent on Ford maintaining the rest of its operations here in the UK?

“There is no sense of engagement across the board” says Denham, who called on both the EIB and the RGF to be subject to review. Another MP added, “Ministers have shown themselves to be incapable… you can’t rebalance growth by tossing a few grants here and there.”

And a final bonus question. Given the pain, why aren’t workers going out on strike? Employees are desperately unhappy, but union members say many don’t speak out because they have been given generous pay offs, which include an extra £20,000 “bonus” for not going on strike. When it comes to a definite chance of a pay off verses a small chance of saving your job, most workers are understandably putting their families first. This is obviously less helpful for all those subcontractors on site, who aren’t receiving any redundancy package from Ford.

Ford are keen to emphasise that they are pursuing voluntary redundancies and relocating workers wherever possible. Workers in Dangenham can take some comfort that a new diesel engine is being developed there, but in general Ford say that they are suffering from over capacity.

Nobody disputes that Britain has to adapt to a changing world. But the way Ford is operating now is not good for business. The company has undermined public trust, and our current industrial strategy has let them get away with it. Ford could improve its brand by celebrating production here in Britain. European consumers would be more likely to buy from a company known for providing good jobs, worker representation and apprenticeships here in Europe. Initiatives like this wouldn’t just be good for business, it might also give those struggling workers and their families another chance.

Ford will be closing plants in Southampton and Dagenham next year. Photograph: Getty Images

Rowenna Davis is Labour PPC for Southampton Itchen and a councillor for Peckham

Getty
Show Hide image

What Labour MPs who want to elect the shadow cabinet are forgetting

The idea is to push Jeremy Corbyn to build an ideologically broad team, but it distracts from the real hurdle – management.

Labour MPs who have been critical of Jeremy Corbyn are pushing to vote for shadow cabinet members – rather than having all the posts appointed by the leader.

Most of the parliamentary Labour party who are not Corbyn loyalists believe this should be the “olive branch” he offers them, in order to put his recent words about “unity” and “wiping the slate clean” into action.

Corbyn and his allies have refused to consider such an idea outside of a “wider” democratisation of the party – saying that Labour members should also get a say in who’s on the frontbench. It’s also thought Corbyn is reluctant due to the shadow cabinet having three representatives on the National Executive Committee. He wouldn’t want his opponents voting for those, tipping the balance of the Committee back towards centrists.

Shadow cabinet elections were a longstanding convention for Labour in opposition until Ed Miliband urged the party to vote against them in 2011. Labour MPs on different wings of the party believe a return to the system would avoid Labour’s frontbench being populated solely by Corbyn’s ideological wing.

But there is a complication here (aside from the idea of a party leader having to run an effective opposition with their opponents in key shadow cabinet positions).

Proponents of shadow cabinet elections say they would help to make Labour a broad church. But really they could put those in the “make-it-work” camp who initially helped form Corbyn’s team in a difficult position. Initially conciliatory MPs like Thangam Debonnaire and Heidi Alexander have since left their posts, revealing frustration more at Corbyn’s management style than policy direction. Chi Onwurah MP, who remains a shadow minister, has also expressed such concerns.

One senior Labour MP points out that the problem with shadow cabinet elections lies in those who left Corbyn’s shadow cabinet but had wanted to cooperate – not in bringing ideological opponents into the fold.

“There were lots of people on his team who actually liked Jeremy, and wanted to make policy with him,” they tell me. “And many of them eventually felt they had to leave because of how difficult it was to work with him. They wanted to stay but couldn’t. If people like that couldn’t stay, will they go back? It will be much harder for him to show them he can work differently.”

One of the “make-it-work” faction voices their concern about returning to the shadow cabinet via elections for this reason. “A lot of us [who left] are still really interested in our policy areas and would be happy to help if they asked,” they say. “But it was too difficult to be taken seriously when you were actually in those shadow cabinet meetings.”

My source describes a non-collegiate approach in meetings around the shadow cabinet table, where Corbyn would read out pre-written opening statements and responses when they delivered their ideas. “It was like he wasn’t really listening.”

The plan to reintroduce shadow cabinet elections barely left the ground in a meeting of Labour’s National Executive Committee on Saturday night, on the eve of Labour conference.

This is in spite of Labour MPs urging the NEC to make a decision on the matter soon. Jon Ashworth, an NEC member and shadow minister, told me shortly after Corbyn’s victory speech that this would be “a good way of bringing people back” in to the team, and was determined to “get some resolution on the issue” soon.

It doesn’t look like we’ll get that yet. But for some who have already tried serving on the frontbench, it’s a distraction from what is for them a management – rather than an ideological – problem.

Anoosh Chakelian is deputy web editor at the New Statesman.