Five questions answered on Grangemouth petrochemical plant closure

What has the government's response been?

Owners Ineos announced this morning that the petrochemical plant at the Grangemouth complex in Scotland will close.  We answer five questions on the closure.

Why is the plant closing?

Ineos made the announcement following a meeting with the workforce at the plant and its associated oil refinery this morning.

The decision comes after a long dispute between workers and management. The company had said if the workforce rejected new proposed changes to pay and pensions the plant would close.

Staff rejected both proposals to freeze pay for three years and to reduce pensions.

In a statement the company said:

"The company made it clear that rejection of change would result in closure. Regrettably, the union advised union members to reject any form of change.”

The outcome of the employee vote on the company's survival plan was a 50/50 split.

How many people work at the plant?

About 800 people are employed at the petrochemical plant, as well as other sub-contractors.

What else have Ineos said?

The company statement goes onto say:

"The shareholders met yesterday to consider the future of the business following the result of the employee vote.

"Sadly, the shareholders reached the conclusion that they could not see a future for Grangemouth without change and therefore could no longer continue to fund the business".

 "As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week."

What has the government said?

Nothing official as yet. Ministers, including the Scotland Secretary Alistair Carmichael and the Energy Secretary Ed Davey, are meeting in London to decide on a response to the decision.

Labour's Shadow Energy Secretary, Caroline Flint, has requested an Urgent Question on the Government's contingency planning regarding Grangemouth Refinery.

What financial problems has Grangemouth faced?

According to Ineos the plant, which has been shut for a week due to the ongoing dispute, is losing £10m a month.

It had said it was ready to invest £300m in Grangemouth, but only if workers agree to the new terms and conditions.

The Scottish government said at the beginning of the week it had been trying to find a buyer for the site. 

The Grangemouth Oil Refinery in March, 2012, in Grangemouth, Scotland. Photograph: Getty Images.

Heidi Vella is a features writer for

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The 7 brilliant arguments Theresa May once made against Brexit

Just in case you missed them. 

“Just listen to the way a lot of politicians and commentators talk about the public,” the Prime Minister Theresa May told the Conservative party conference in October. “They find your patriotism distasteful, your concerns about immigration parochial, your views about crime illiberal, your attachment to your job security inconvenient.

“They find the fact that more than seventeen million votes decided to leave the European Union simply bewildering.”

Of course, there was a time not that long ago, when May too found the idea of Brexit pretty bewildering herself. Nicknamed “submarine” during the EU referendum campaign for her low-key support for Remain, she nonetheless had made up her mind it was the right thing to do. 

In a recording obtained by The Guardian, she told an audience at Goldman Sachs that “the economic arguments are clear”. She continued: 

“I think being part of a 500m trading bloc is significant for us. I think one of the issues is a lot of people invest here in the UK because it’s the UK in Europe. 

“I think if we were not in Europe, there would be firms and companies who would be looking to say do they need actually to develop a mainland European presence rather than a UK presence.

But if that hasn’t convinced you, luckily May also made a public case for Remain on 25 April 2016. Here are some of her best points:

1. There’s no such thing as total sovereignty

At conference in October, May said Britain was leaving “to become, once more, a fully sovereign and independent country”. 

But in April, she said that “no country or empire in world history has ever been totally sovereign”. Nation states, she said, have to make a trade off between agreeing to cede some sovereignty “in a controlled way” to prevent a greater loss of sovereignty in an uncontrolled way, such as “military conflict or economic decline”. 

2. It's safer to Remain

In her conference speech, May said she wanted a Brexit deal to include “co-operation on law enforcement and counter-terrorism”. 

In April, though, the then-Home secretary thought it would be a lot simpler just to stay in the EU. She predicted that while a Brexit Britain would still share intelligence, “that does not mean we would be as safe as if we remain”.

For example, May helpfully pointed out, a Britain outside the EU would have no access to the European Arrest Warrant, which allowed her department to extradite more than 5,000 people from Britain to Europe in the last five years. 

She also distinguished between the EU’s freedom of movement rules, and border checks, declaring: “Some people say the EU does not make us more secure because it does not allow us to control our border. But that is not true.”

3. Rules are better than no rules

At conference, May said Brexit would mean “our laws made not in Brussels but in Westminster”. Anyone who believed they were a “citizen of the world” was in fact “a citizen of nowhere”. 

Back in April, she had a more nuanced view. She said Europe had “stumbled its way to war in 1914” because of the “ambiguity of nations’ commitments to one another”. 

She declared: “Nobody should want an end to a rules-based international system.” Although, she did add that reconciling these international systems with democratic government was “one of the great challenges of this century”. 

4. It could break up the UK

In her speech at conference, May took aim at the Scottish Nationalist Party when she blamed “divisive nationalists” for threatening to drive the UK apart. 

When she spoke in April, though, it seemed she might be talking about a different set of nationalists. “If Brexit isn’t fatal to the European Union, we might find that it is fatal to the Union with Scotland,” she warned. 

Scots are more likely to be in favour of the EU than voters in England and Wales, she noted: 

“I do not want the people of Scotland to think that English Eurosceptics put their dislike of Brussels ahead of our bond with Edinburgh and Glasgow. I do not want the European Union to cause the destruction of an older and much more precious Union, the Union between England and Scotland.”

5. Brexit endangers Britain’s financial services industry

In her conference speech, May described London as “the world’s leading financial capital”. 

But according to May circa April 2016, it might not be for much longer. She warned that outside the EU: “There would be little we could do to stop discriminatory policies being introduced, and London’s position as the world’s leading financial centre would be in danger.”

6. Negotiating trade deals won’t be easy

May is a believer in free trade – her conference speech was peppered with references to it – and she has appointed Liam Fox as International Trade secretary to broker new deals.

And she knows how hard that will be. In her April speech, she noted Britain would have to replace 36 existing trade agreements with non-EU countries: “While we could certainly negotiate our own trade agreements, there would be no guarantee that they would be on terms as good as we enjoy now.”

7. Nor is staying in the single market

Even in April, May was clear she thought Britain could survive Brexit, but she was not sure whether it would do so better off.

As she put it: 

"The reality is that we do not know on what terms we would win access to the single market.  We do know that in a negotiation we would need to make concessions in order to access it, and those concessions could well be about accepting EU regulations, over which we would have no say, making financial contributions, just as we do now, accepting free movement rules, just as we do now, or quite possibly all three combined.  

"It is not clear why other EU member states would give Britain a better deal than they themselves enjoy."

Couldn't agree more, Prime Minister. 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.