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Motorola, Bathgate

3.31 pm

Mr. Speaker: Private notice question. Mr. Dalyell.

Mr. Tam Dalyell (Linlithgow): May I thank you, Mr. Speaker, for your thoughtful and considerate words, in answer to a point of order yesterday, to those who have lost their jobs at Bathgate, and for allowing me to put a question to my right hon. Friend the Secretary of State for Trade and Industry, of which I have given him private notice--namely, if he will make a statement on the Government's actions in relation to Motorola in Bathgate?

The Secretary of State for Trade and Industry (Mr. Stephen Byers): I know that my hon. Friend the Member for Linlithgow (Mr. Dalyell) will share with me and, I think, most Members of the House, the feelings of regret and disappointment caused by Motorola's decision to close its plant at Easter Inch in Bathgate. This is a bitter blow for hard-working people and their families. In considering our response to this announcement, we need to be aware of the reasons for Motorola's decision and the steps that will need to be taken to help those individuals affected and the communities in which they live.

There is no doubt that Motorola is facing a difficult position with the sharp downturn in the market for mobile telephones. That was the reason given for yesterday's decision. As a consequence of this global decline, Motorola announced trading losses of £140 million for the first quarter of this year.

The closure of the Easter Inch factory is part of the wider rationalisation of global production capacity by Motorola personal communications sector--its mobile phones division. Since December, Motorola has announced plans to cut 12,000 jobs worldwide in this sector alone. It is closing two plants in the United States and cutting its work force in Brazil. In Europe, Motorola has sold its Dublin facility, with a major loss of jobs.

The Scottish Executive have been in constant contact over the past few weeks with Motorola both in the United Kingdom and in the United States. The Government have backed the Scottish Executive's efforts. The Prime Minister, the Chancellor of the Exchequer, the Foreign Secretary and I have all made representations to Motorola.

In the end, Motorola took a decision that it believes to be in the long-term commercial interests of the company. However, there is no doubt that this will be an extremely difficult time for all those affected by the announcement. It will be a devastating blow for individuals, the families and the communities in which they live.

The first priority must be to pursue with Motorola future options for the Bathgate site. We need to explore every possible future use of that excellent facility. There are a wide variety of options to explore with the company--ranging from sale as a going concern to, possibly, sale to a contract manufacturer or to another related business. The other alternatives include new employment for a new employer purchasing the site. Invest UK stands ready to assist the Scottish Executive in that task.

In order to assist the individuals affected, the Scottish Executive are setting up a taskforce, made up of Scottish Enterprise Edinburgh and Lothian, the Employment

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Service, West Lothian council, the careers service, the Benefits Agency and the Scottish Trades Union Congress. The taskforce will draw up an action plan to meet the needs of the Motorola workers. Subject to the agreement of Motorola, that is likely to include an on-site jobshop, business start-up workshops and other support to assist people to find jobs--[Interruption.] The Conservatives may joke at the measures that we are putting in place to help those affected by the decision, but Labour Members and people in Scotland know only too well what the Conservatives did in the 1980s: they did nothing for the people of Scotland--that is the reality of the situation.

Because those individuals need assistance, the taskforce has been set up and has already begun its work to help them. The action plan will meet the needs of those individuals. The Scottish Executive are setting aside up to £10 million to help fund the action plan. It has been made clear to Motorola that it will have to pay back the £16.75 million in regional selective assistance that it has received for the plant during the past six years. That will be the largest clawback of RSA grant in the history of Scotland.

Although the Bathgate decision is a real body blow, we must not forget that Motorola will remain a major employer--and the largest electronic manufacturer--in Scotland. The company has given assurances that its semiconductor operations at East Kilbride and South Queensferry are unaffected by yesterday's decision; we welcome that. The company remains committed to a software development centre at Livingston and to the planned next generation of semiconductor technology in Dunfermline. Despite the decision, towards the end of last year, to reconsider the timing of the Dunfermline plan, Motorola has emphasised its underlying commitment to that project.

We would expect that workers from Bathgate, affected by yesterday's decision, will have the opportunity to retrain and to apply for those new jobs being created by Motorola in Scotland. The company has confirmed that it looks forward to building on its 32 years' association with Scotland, and that it sees Dunfermline as the cornerstone of its future investment.

It is clear that, at a time of globalisation, many sectors of industry are going through major restructuring, and that there are bound to be implications for us in the United Kingdom owing to the slowdown in the world economy, especially in the United States. However, we should not overstate our difficulties. Most forecasters expect manufacturing output to grow this year. The medium-term prospects appear good with productivity having grown at 6 per cent. Exports are also growing, with manufacturing export volumes up by more than 10 per cent. in the last year.

No country can ever insulate itself from world economic events, but it is because of the decisive action that we have taken--introducing tough fiscal rules, reducing the national debt, making the Bank of England independent and delivering the lowest inflation for 30 years--that British economic policy is much better placed than it has ever been in the past.

We are on course to continue to deliver stability and sustained growth, but it is an extremely difficult time for individuals and communities when jobs are lost as industries restructure in the face of change. It is even more frustrating when, as in this case, those losses arise because

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of global managerial decisions based on financial problems in one sector, despite the success and the profits coming from the plant that has been earmarked for closure.

This will be a difficult time for all those affected by the announcement. The Bathgate work force are productive and highly skilled. I know that, working with local and national agencies and the Scottish Executive, the United Kingdom Government will do all we can to assist them to find new jobs.

The closure of the Easter Inch plant will take place over six to 12 months. Motorola, the Scottish Executive, the Employment Service and the Government will work together to ensure that employees are found new employment before redundancy takes effect.

Bathgate has suffered from job losses before. In the 1980s, unemployment reached 17 per cent. but, through hard work and commitment, the situation has been turned around. As a result, the current rate of unemployment in West Lothian stands at 3.8 per cent.--a great success story. However, I am the first to acknowledge that those figures will be of little comfort to the workers affected by the announcement. Many hon. Members will understand the anger and frustration that they will feel. We must do all we can to help them through the difficult months ahead. By working together with the Scottish Executive, I am confident that we will be able to meet the challenges that lie ahead and, as a result, offer real hope to those individuals, their families and the communities affected by Motorola's decision.

Mr. Dalyell: May I thank my right hon. Friend for the tone and content of his statement? Does he sympathise--I do not doubt for a moment that he does--with those who are having to face redundancy, not for the first, not for the second, but in some cases for the third, fourth or even fifth time in their lives? Does he recognise that the majority of the 3,200 people losing their jobs are youngish people, who--thanks, in part, to Motorola's first-class and caring training policies and, in part, to excellent schoolteachers and further education lecturers in central Scotland--are eminently employable?

Looking to the future, should we not co-operate with Motorola in getting the best possible redundancy terms for those who are losing their jobs? Is not the company's offer of four weeks' pay for every year of service four times the statutory requirement, and confirmation of the company's decency towards its employees?

Does the Secretary of State recognise that Motorola has a 32-year commitment to Scotland at East Kilbride and continues to work closely and constructively with many organisations and, in particular, with the Minister of State, Northern Ireland Office, my right hon. Friend the Member for East Kilbride (Mr. Ingram), who endorses my favourable attitude towards Motorola?

Does my right hon. Friend recognise that Motorola has provided 20,000-odd person years of quality employment at Bathgate, which will always be appreciated throughout the central Scotland community? Will he do everything in his power to encourage Motorola to develop and expand research and software facilities in my right hon. Friend the Foreign Secretary's constituency of Livingston and to go ahead with the proposed semiconductor development

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at Hyundai in my right hon. Friend the Chancellor's constituency of Dunfermline, East? Does my right hon. Friend the Secretary of State for Trade and Industry agree with Bill Speirs of the STUC that the Government must do everything to keep Motorola in Scotland?

Albeit that there are legally obligatory repayments under regional selective assistance, when my right hon. Friend considers such matters, will he take into account the point that Motorola should in no way be scapegoated? Is not the truth that West Lothian has been resilient since the days of James "Paraffin" Young in the industrial revolution and that it is a vibrant industrial community, which has the potential to absorb many of the 3,100 skilled work force? Incidentally, is it not a fact that, according to Scottish Enterprise Edinburgh and Lothian, although 800 redundancies were declared by Continental Tyres at Newbridge in late 1999, only 31 people of those people remain unemployed? I know from my first-hand knowledge that there are explanations for some of the cases that are included in that figure of 31.

Do we have the assurance that my right hon. Friend--along with the Secretary of State for Scotland, my right hon. Friend the Member for Airdrie and Shotts (Mrs. Liddell), who is sitting beside him and whose constituency is affected, and the constructive and efficient members and officials of West Lothian district council and the Scottish Executive--will make sure that the full resources of Government are brought to bear to ensure that customised training will help to place these skilled workers as quickly as possible into alternative employment? I cannot sufficiently emphasise the importance of customised training, especially against the backdrop of a continuing skills shortage in our area.

Does my right hon. Friend share a certain unease that part of the trouble has been brought about by young analysts, operating in Wall Street and in the City of London? They have no great knowledge of industry and they are concerned about getting a quick buck. They know very little about the lives of the people affected and on whom they have such a great effect.

Does my right hon. Friend share my unease about the culture of blame that has developed in relation to redundancies in high-tech industries? Hindsight is a marvellous thing, and we might all be better if we possessed perfect foresight. Is it not true that, until Christmas 2000 when every primary school pupil in the playground seemed to have asked for a mobile phone, demand boomed? In six short weeks, the mobile phone has become a product that we replace only when we lose or bust it.

Can we count--I am sure that we can--on the sustained and intense co-operation that my right hon. Friend the Prime Minister promised at 3.15 pm in answer to the pertinent question of my hon. Friend the Member for Kilmarnock and Loudoun (Mr. Browne)?

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