Latest news with #SubsidyControlAct2022
The Herald Scotland
7 days ago
- Business
- The Herald Scotland
Unions say Alexander Dennis move to England is a 'political failure'
Union representatives told MSPs that while the proposal has not yet been finalised, the move could endanger approximately 400 Scottish jobs. This news follows the loss of more than 400 jobs just a few miles away in Grangemouth, where the local oil refinery recently closed and was converted into an import terminal. Derek Thomson, the Scotland regional secretary for trade union Unite told economy committee MSPs: 'It'll be catastrophic in Falkirk and Larbert to lose that amount of jobs.' Read more: And Robert Deavy, the senior organiser for manufacturing with GMB Scotland said the situation would require a political intervention to resolve. 'Speaking to our members, this is something that we as a union have been raising for some time – I'm pretty sure Unite have been as well,' he said. 'We believe that this is a political failure that now requires a political solution. He added: 'Now we need everyone to come together – trade unions, politicians and, really importantly, we need ADL involvement on this.' The bus firm at the centre of a row over its move to England after receiving £90 million of public money for Scottish jobs had been offering a grain of hope of a reprieve for hundreds of jobs - following government intervention. Alex Salmond and Nicola Sturgeon launched their financial case for Scottish independence at Alexander Dennis (Image: Newsquest) The Scottish Government was accused of "strategic neglect" after the Herald revealed the extent of support Alexander Dennis (ADL) has had - while the First Minister was warned last year that it was "reconsidering" its "entire investment" in Scotland. And the SNP-led Scottish Government and the Labour-led UK Government have agreed to establish a joint working group to discuss options to find a solution and avert job losses. They are looking at how far they 'can push' the UK 'state aid' rules set out in the Subsidy Control Act 2022 to create a support package to save the 400 jobs. Alexander Dennis has said that they are engaging with both governments "in good faith on the possibility of any intervention" and stressed that a final decision on the move had not yet been made. The committee is due to take evidence from the bosses of ADL in a special session on Thursday. The company, the unions said, is losing out on contracts to cheaper foreign alternatives as a result of their lower costs, with Mr Thomson calling for direct awards to be made from Government to the company and for workers to be paid until work on the contracts begins. 'What we understand is that pending those direct awards or contracts being done, there is a four month gap between bringing those contracts online and the end of the consultation period,' he said. 'What we have been asking for and speaking to the Deputy First Minister about is a time-limited furlough scheme where we can support those workers through that period of the contract being awarded.' Mr Thomson stressed, however, that ADL would need to agree to continue production in Scotland, rather than winning the contract and building the buses at Scarborough. The union leader said the furlough cost is expected to be between £4 million and £5 million. Speaking to journalists earlier this month, First Minister John Swinney said the Government was considering a furlough scheme. Mr Deavy warned MSPs that, if the sites close, then 'the skills are lost forever' in the area.
The Herald Scotland
23-06-2025
- Business
- The Herald Scotland
Hope for 100s of Scots jobs hit by bus firm plan to go to England
And it has emerged that the SNP-led Scottish Government and the Labour-led UK Government have agreed to establish a joint working group to discuss options to find a solution and avert job losses. They are looking at how far they 'can push' the UK 'state aid' rules set out in the Subsidy Control Act 2022 to create a support package to save the 400 jobs. The second meeting of that working group was held on Monday last week and it is due to meet again this week. An Alexander Dennis source said that they are engaging with both governments "in good faith on the possibility of any intervention" and stressed that a final decision on the move had not yet been made. Read more: The Scottish Government came under fire after the deputy first minister Kate Forbes pledged to leave "no stone unturned" in securing a future for ADL. Kate Forbes (Image: Colin Mearns) Ministers have said there was "cause of hope in terms of looking at a way through the challenges". A row erupted in the Scottish Parliament in the wake of revelations in the Herald over the depth of the public funding for Scottish jobs over the past ten years - and even while it was cutting back its workforce by a third five years ago. The Herald also revealed how the First Minister was warned of Alexander Dennis concerns last summer a year before announcing plans last week to relocate to England putting 400 jobs at risk. Alexander Dennis, which has factories in Falkirk and Larbert, said it was considering moving manufacturing to a site in Scarborough. The plans would see work at the Falkirk site discontinued, while the Larbert site would be closed after current contracts are completed. The company said it was facing strong competition from Chinese electric bus manufacturers whose share of the market had risen from 10% to 35%. Alexander Dennis, which manufactures single and double decker buses, said the new proposed structure would lower costs and increase efficiency. Calls have been made to claw public money back money if Alexander Dennis follows through with its plans. The Herald revealed that the row between ministers and ADL emerged over levels of support and had its roots in Scottish Government schemes launched from 2020 to accelerate the use and manufacture of zero and low emission buses in Scotland and 'help drive a green recovery out of the Covid pandemic" which have been worth a total of £155.8m to date. The SNP launched their financial case for Scottish independence at Alexander Dennis (Image: Newsquest) Frustrations emerged after May 2023 when Alexander Dennis hosted the second phase of the Scottish Government's Zero Emissions Bus Challenge Fund (ScotZEB) which was to have funding worth £58m. It also showcased its Enviro100EV concept, a lightweight single-deck zero-emission bus with new in-house battery powertrain confirmed that grant backing accelerated its development. In a scathing letter seen by The Herald, Paul Soubry, president and chief executive of Alexander Dennis's parent company NFI, told John Swinney that recent developments had 'regretfully left [them] with the impression that the Scottish Government has little regard for domestic bus manufacturing jobs in Scotland'. The First Minister was also told they had already been 'forced' to offshore certain manufacturing functions to China. But a Scottish Government memo said that ADL had received orders for 363 zero-emission buses from ScotZEB more than any other manufacturer benefitting from the schemes. A separate briefing states that Alexander Dennis was awarded only 17% or 44 buses from second phase of the programme. A significant grant through the ScotZeb 2 programme was awarded to Zenobe, and its consortium of bus and coach operators to support the transition of bus fleets to electric. ADL, which incurred total losses over three years of £44.9m between 2021 and 2023, made its own bid to the programme but was unsuccessful. While ADL was a supplier to the successful consortium it was not a formal part of it. An Alexander Dennis spokesman said: 'Our focus remains on ensuring our people are supported during our consultation process. "This is a challenging time, and we are grateful for the active engagement from the Scottish and UK Governments and other political parties and stakeholders to discuss options and possible interventions. "It is clear there is a shared ambition to ensure the Scottish and UK manufacturing industry is protected and can thrive and we hope that we can encourage a cross-nation, collaborative approach as we continue to progress these important discussions.' The Scottish Government has said that policy interventions had been designed to "accelerate uptake of zero emission buses in the Scottish market". According to Scottish ministers, ADL secured orders for more than 360 vehicles through Scottish Government funding programmes. And they say the route to providing further support involves looking at ADL's cost base, considering what additional support can be provided to help with productivity and to lower costs and to look at how an order book can be developed for the company. They to say that there is "cause for hope" and that there were "solutions" that can be delivered through the collaborative process. While they say they have to abide by public procurement regulations and subsidy controls, but were working on a "support package" for the company.
The Herald Scotland
12-06-2025
- Business
- The Herald Scotland
Ministers urged to act over Alexander Dennis job losses
The plans would see work at the Falkirk site discontinued, while the Larbert plant would close once current contracts are completed. The company blamed strong competition from Chinese electric bus manufacturers, whose share of the market had risen from 10% to 35%. (Image: Alexander Dennis) Alexander Dennis employs 1,850 people in the UK, with its largest plant in Larbert. During First Minister's Questions, the Scottish Labour leader said the news was a direct consequence of 'SNP failure'. He contrasted the Scottish Government's recent order of just 44 zero-emission buses from Alexander Dennis with Greater Manchester's purchase of 160. 'Under the SNP, the Scottish Government is procuring more buses from China than they are from Scotland,' Mr Sarwar said. 'Greater Manchester Mayor Andy Burnham has bought almost four times as many buses from Alexander Dennis as the SNP Government. That is shameful. "So can I ask the First Minister, why do the SNP always put foreign businesses and manufacturers before Scotland's workers?" READ MORE Mr Swinney said: 'Since 2020, Alexander Dennis has secured more zero-emission bus orders than any other single manufacturer through the Scottish Zero Emission Bus Challenge Fund and its predecessor, the Scottish Ultra Low Emission Bus Scheme. 'We have provided £58 million of funding for zero-emission buses since 2020 through the Scottish Ultra Low Emission Bus Scheme. Scottish Enterprise has also supported Alexander Dennis with £30.3 million in research and development support as a contribution to their research and development activity. 'That has been part of the partnership undertaken between the Scottish Government and Alexander Dennis.' Mr Sarwar saoid the answer was "weak." "If Greater Manchester Mayor Andy Burnham can find a way within the existing legislation to procure more buses in Scotland. Why can't the SNP government? "It is another example of weak leadership from John Swinney. 'When Scotland needs buses, they buy from China,' Mr Sarwar told MSPs. 'When Scotland needs steel for bridges, they buy from China. When we need ferries, they buy from Poland and Turkey. Because all they want to do is manufacture grievance, and all they offer is waste and incompetence.' The First Minister responded that he was focused on delivering 'answers and solutions' rather than posturing. He said his government was in talks with UK ministers to explore ways to support the company. However, he noted that the post-Brexit Subsidy Control Act 2022 — which limits government support — constrained what action could be taken. The First Minister quoted Alexander Dennis managing director Paul Davies, who said: 'The stark reality is that current UK policy does not allow for the incentivisation or reward of local content, job retention and creation, nor does it encourage any domestic economic benefit.' Mr Sarwar claimed it was part of a wider pattern of 'weak, failing leadership' from Mr Swinney, adding: 'Even his own MSPs are now openly rebelling against him, with senior figures saying he has two weeks to come up with a new idea to save his job.' Falkirk MSP Michael Matheson said the jobs were 'not yet lost' and urged both governments to work together. He said: 'The last thing the workforce in my constituency need is for their future employment to be simply turned into a political football. Indeed, they deserve much better. 'Now more than ever, the workforce needs the Scottish and UK governments to work together.' Mr Matheson pressed Mr Swinney to commit to maximising potential new orders for Alexander Dennis across the UK and addressing the 'uneven playing field' created by subsidy rules. Mr Swinney gave Mr Matheson his 'absolute assurance' that the Scottish Government would enter the consultation process 'determined to safeguard the future of employment in his constituency'. Scottish Conservative MSP Graham Simpson accused the Government of ignoring previous warnings that support schemes would end up subsidising overseas firms. 'There have been various funds from the Scottish Government to help bus companies buy electric buses,' he said. 'One of them was launched by Michael Matheson, and that money — our money — has gone to buy Chinese buses. 'Some of us were warning years ago that this would end in tears, and that is where we have got to.' Mr Swinney responded: 'I am trying to handle this issue in a way that is not making any party political remarks. But I have to point out to Mr Simpson that the Subsidy Control Act was legislated for by the Conservative Government in the United Kingdom. 'It is the UK legislation that we are obliged by law to follow. I cannot act in a fashion outwith the provisions of the law, because I will just not be enabled to do so. I will not have a legal basis for acting in that fashion.'
