Economy in Doldrums as Massey Closes

Workers' Daily Internet Edition: Article Index :

Economy in Doldrums as Massey Closes

Manufacturing Recession

Victory for Tower Hamlets Nursery Nurses on Pay and Terms

Safeguard the Future of the NHS – Reduce the Cost of Contracts

The announcement of the closure on Friday, July 25, of the Massey Ferguson tractor factory in Coventry with the loss of a thousand jobs is a major blow to manufacturing and the economy both locally and nationally. The estimated loss to the local economy has been put at around £20m according to business leaders.

The announcement comes at a time when official statistics show that the economy is in serious crisis, stagnating at around quarter on quarter GDP at 0.3% growth between April and June. Economists had been hoping for growth of 1.8% for 2003 that is around 0.5% per quarter.

Massey is owned by the American tractor-maker and manufacturer of farming equipment AGCO, which has decided to consolidate production in France and Brazil. The manufacture of high specification vehicles will go to Beauvais in France, while more basic units will be transferred to Canoas in low-cost Brazil. In this move, the famous Banner Lane plant in Coventry closes, marking the end of an era in agricultural machinery production.

The effect is to jeopardise the economic backdrop to nation building and requires the working class to step in and save the day. If the major transnational companies are allowed to remove production willy nilly to wherever they want and for their own interests then whole economies are threatened. Workers must themselves become political and decide the direction the economy must take, ensuring that decisive production facilities are maintained.

Output from Britain's industrial sector slipped into the red in May, official figures showed on July 7. The office for national statistics said car production and hi-tech engineering led the 0.2% decline in manufacturing output in May, which erased some of April's increase and left factories producing 2.1% less than they were a year ago.

May's manufacturing downturn was widespread, the ONS said, with six of the 13 sub-sectors reporting falling production. Overall industrial output, which includes energy extraction and supply, rose 0.1% in May.

Over the last three months the most significant cutbacks in production were in the metals industry, where output was down by 2%.

There was no sign of a revival in the hi-tech sector, which plunged into recession after the dotcom bubble burst. Output was down by 1.3% over the three months to May, despite hopes that a small rise in April marked the beginning of a recovery. Computer production fell by 4.8% in May alone.

Downturn dogs producers

Manufacturers on both sides of the Atlantic suffered a renewed contraction in business in June, surveys revealed earlier this month. "The manufacturing sector is likely to contract once again in the second quarter and today's PMI supports only a weak recovery heading into the second half [of the year]" said Alan Castle of Lehman Brothers on July 2.

Nursery nurses in East London’s Tower Hamlets have won a decisive victory in their fight against moves to change their working conditions, UNISON reported on July 23.

The nurses had initially been offered more money on a higher pay grade, but at the price of seeing their year-round contracts changed to term-time only. The dispute eventually flared up until a three-week strike, backed by local residents, who helped contribute a 3,000-strong petition to the local council.

That strike has now ended with all 120 nurses involved getting full-year pay but salary for a full 35-hour week instead of the 32.5 they are now paid for. They will now be paid £19,791 to £20,859 per year, UNISON says.

Speaking on behalf of Tower Hamlets UNISON, Chris Connolly said: "The dispute was never just about money, it was about the principle of treating nursery nurses as full-time professional staff. The fact that we had an extremely well organised, determined group of women on strike, backed strongly by parents and the public, meant that the council had to take notice of us."

Chris Connolly added that other nursery nurses struggling for professional recognition should take heart from the victory and continue their fight.

When the cost of funding the NHS is raised there is never a mention of the cost of contracts. Corporate contractors are bleeding the country dry by charging extortionate prices for the work they carry out. Everyone knows how much the price is put up by bloodsucking companies when one has to think back to the price of the rail link to the channel tunnel. Original estimates always seem to go up and up. When the very arteries of the road system are looked at and new motorways are built or extended the scam is to push the costs up and up.

In Dudley the plans made by the local trust were to put all of the local hospitals under one roof and we now have a situation where a multi-million pound contract was shared by building contractors like McAlpine. The consequence has been that the "modernised" Russells Hall complex has now fewer beds to offer. The privatisation scam led the auxiliary workers to wage a mammoth strike against the proposals a couple of years ago.

The simple fact is that in all social programmes, private contractors are making a killing out of the situation. They have services by the throat and are willing to drain every last drop out of them.

In a school local to Russells Hall a company has charged over £50m just for double-glazing and new roof tiles. Who on earth is sanctioning such a rip off? Where is the voice of the local clerk of the works? Why are authorities held to ransom in this way?

Recently a Wolverhampton company netted a huge £1bn contract to re-develop a Portsmouth Hospital. The hospital company, it turns out, is a joint venture between Carillion and the Royal Bank of Scotland. It is line to re-build the Queen Alexandria Hospital. The contract will see the creation of a single 1,200 bed site drawing together scattered facilities by 2007. The proposal looks very much like the arguments for rationalising Russells Hall but on a bigger scale still.

How on earth can such huge figures be justified? What is going into the building to warrant such costs? One worker asked, "How much does it cost Railtrack to re-lay a few rail lines, when they are asking for billions to do it, after all they are only a couple of pieces of metal and a few wooden sleepers? What is a building, a few rooms and a roof? I might be being simplistic because things have to go into a hospital but you know what I'm getting at don't you?"

When you look at the way the monopolies control the market you can see how the private corporations are plundering the national wealth. Even suppliers to the NHS are haemorrhaging it like, for instance, the pharmaceuticals. It is time that the working class moved in to prevent this complete stitch up. There is no need for most of the social sector to be tied to such contracts, maintenance and new projects require a completely new approach so that the work is done at the least cost to the economy. In this way the workers can set about a complete renewal programme and one of nation building without the constant wounding it regularly receives.