The Labour movement column
By Anthony Painter / @anthonypainter
A couple of years ago I was driving up the A38 – the Birmingham road section approaching Longbridge – for the first time in a while. I actually grew up not far from there and went to school just a mile or so from that section of the road. As I approached what used to be the Rover car factory I felt a visceral sense of loss. Where the Rover factory – that was once the second biggest car factory in Europe in the 1970s – had stood, there was now a void. In its place were a few JCB diggers and mounds of rubble.
It was the realisation that a part of the community – the central part of the community – has simply been amputated. And like an amputee sensing a phantom limb, the communities around the factory must continually look at that site and wonder, "what happened? How could it happen?"
I remember the strikes in the 1980s, going around the factory and looking with awe at the robots and the shiny new minis, and the excitement of the Maestro onboard computer (over-excited; it was hardly Kit out of Knight Rider, though it felt like it was at the time). A huge number of working age men in the local community either worked in the factory or in the parts and supplies manufacturers that fed off Rover. Friends would tell me with pride that they had got a job at the factory and, what’s more, it was a job for life. In my snotty way, I would tell them that there was no such thing. Unfortunately, I was right. But I had no notion that the entire thing would disappear.
Sure, most of the people who worked there have gone on to find employment elsewhere. They are often jobs that are much less well remunerated, much less secure, and lack the same sense of pride that came with working at an icon that generations of your family had worked at too. Social mobility was all well and good but this was pride. Pride in your community, pride in your city, pride in your family and pride in yourself. This was not share capital, return on investment, or rate of return – it was about identity; who you were and celebrating your place in the world. If you want to get a sense of Birmingham at that time then read The Rotters Club by Jonathan Coe – that is just how it was.
And now, that community is left with retail parks and promises of high-tech renaissance. That shouldn’t be knocked but it’s not the same thing. A measure of the consternation that local people must feel is the emergence of the BNP. In Northfield, Longbridge and Kings Norton wards, they polled 16.9%, 14.1%, and 10.8% respectively.
At Christmas, we’d sometimes get the train from Longbridge station into Birmingham New Street. One of the stations we’d pass through was Bournville. It was a magical place – I had been convinced that the canal that passed alongside it was made of chocolate. You don’t have to reach for Roald Dahl to remember the excitement when each new Cadbury bar found its way onto the shelves. Kids were proud of their parents who worked in Cadbury, just as kids were proud of their parents who worked at Rover.
OK, so the takeover by Kraft doesn’t spell the end for Cadbury. Who knows, Irene Rosenfeld could remain true to her word and it could mean an expansion of manufacturing output and employment in the UK. I just wouldn’t bet on it. And we have no way to enforce it.
There was no reason for Cadbury to be sold to Kraft. It is a perfectly healthy business. It is embedded in the local community. It has history. More importantly, it carries an ethos – a company is more than a vehicle for ownership. It is the engine of community. It has responsibilities to its workforce and the community in which it operates. Bournville is a model village (OK, apart from the fact it doesn’t contain a pub.) The well-being and health of Cadbury’s workers were central to the ethos of the business. Quakers knew how to be good capitalists.
The shocking thing about this takeover is not that it is happening. It is that it is happening with so few guarantees for the future of the Bournville factory, its brands, its workers, and the local community. This is not because the Government didn’t want concrete assurances – it is clear that Lord Mandelson did his best within the confines of the law. But the power balance between the market and the state has shifted over the last three decades so that not only can we not get assurances that hostile takeovers will be in the public interest, we can no longer even ask the question in any meaningful way.
We should not be in a position where a major hostile takeover can not be required to agree to undertakings that they will act in the public interest and the interest of the communities they will serve. Will Hutton and Phillip Blond put it about right in a piece in the FT last week:
“The competition rules are ill-interpreted and toothless without a public interest test for mergers and buy-outs.”
This position is not a return to a naïve protectionism. It is simply to ensure that wider interests than the current shareholders – some of whom will have become recently shareholders having smelt blood – are protected when a hostile takeover occurs. It is a way of building greater legitimacy in markets. It is a way of embedding markets in society. It is a way of giving neutral market forces a soul and ethos.
Rover and Cadbury are not the same cases at all. Cadbury’s future seems assured in some respect. However, the importance of both companies to their local (and in some ways overlapping) communities is clear. Kraft should agree, legally, to undertakings to protect the public interest because rapid industrial and economic change can devastate an area – just look at those former coal-mining villages. The problem we have as a nation is how do we force them to do so if they refuse to play ball? That is a more profound issue that goes into the balance of power between the state and the market. It has become apparent that we have got that balance wrong. It is time to re-adjust.
Delicious
Digg
Reddit
Facebook
StumbleUpon
Lets celebrate the fact that all the F1 cars are made here and spend the money we used to subsidise BL with on better things.
Well, you may; personally I deplore the carbon footprint, gratuitous consumption, and exorbitant income associated with F1.
My parents drive a Toyota - a Japanese car built on the outskirts of Derby. Why is it that a Japanese company was able to mantain manufacturing mass-produced cars in Britain when Rover couldn't?
In my book, Toyota cars built here qualify as British-built cars because of the employment of British people. Good for your folks, although I hope their car does not have the problem of that accelerator pedal. In the same way, Honda at Swindon, Nissan at Sunderland, Vauxhall at Ellesmere Port and Luton, also qualify as British-built.
Your second question is one for the Thatcher government. Her government gave incentives for Nissan to establish its plant in Sunderland and Toyota followed. Others might be better able to comment.
I also agree with Max - it aint chocolate they produce.
Oh and the Rover 75 - goodish car but the design was just horrendous. Like a 1950's throwback.
Shame about Longbridge though. Agree with Mike (be interested to know what designs his uncle has been involved with)
My uncle cut his draughtsman teeth on P6 and the semi-independent rear suspension. He then worked on P8, P9 & P10, a large 4L V8 saloon (P5 replacement), a mid-engined V8 2+2 sports car and a P6 replacement subsequently canned by BL board fighting. Then onto SD1, 2, 3. The SD1 was a world-beater on paper until the muppets on the production line got near it. He also spent a short time on the Triumph Stag at the behest of Spen King who was the ex-Rover chief engineer in charge.
He then got sought out for the ECV project which was using advanced composites and aluminium to build fuel efficient cars (this was around 1980). Again, Rover's patent aluminium technologies were world-beating at the time.
He left when only the K-series engine was selected out of the project, the cars which were all aluminium monocoque were deemed 'too futuristic'.
He then worked for a number of design shops including Prodrive and also McLaren and Williams as a freelancer.
Thanks so much for the response. Your uncle sounds very talented and visionary.
Why pick the name Ludwig?
(Unlike me, of course. I can - and frquently do - spout off on any subject under the sun ;-)
Opine all you wish, but today your nom de plume seems to be a misnomer.
I'll try to add something nasty about Brown and his Labour Government - but what can one say that hasn't been said? What can one add to the mountain of opprobrium that he and they generate?
Although, I could mention that Brown did tell a porkie a PMQs today - denying Peter Watt's claim about Brown's private slush fund.
Who is Dave?
The best way for workers to protect their jobs is to be skilled, on top of QC and efficiency improvements. Unfortunately unlike the Germans and Japanese we have allowed ourselves to become shoddy in our ways. Now we are shoddy and expensive. Sorry boys and girls, the market has gone global and in many sectors we have been left behind. Time for a radical rethink. Let's start with education and training, shall we.
I remember, as a supplier of factory automation equipment, the machinations of Red Robbo. He took BL workers out on strike, because the Gov. was weak and to demonstrate that he could. The Bolshy attitude of Unions, in the past, has much to do with the demise of British manufacturing.
I remember the demarcation strikes at Cammel Laird, the lockouts that ensued, because the Boilermakers Union could not agree with the Union that looked after the Pattern-makers "who would twang the string".
Then as a young engineer I went to Germany to test a machine that was ready for delivery, to find that a young woman had installed all of the electric's, hydraulics, mechanics, sensors and controllers, and had commissioned the machine by herself. I was impressed. In the UK it would have taken at least four trades to do the same job.
Secondly, state support is stronger in Germany and France, especially the latter. In fact, it verges on the state capitalism of the emergent east. Under Thatcher, the UK was diverted to the transatlantic model rather than the European model of capitalism - the fons et origo of all the decline.
State support can be enabling: Heath did a U-turn on the 'Selsdon man' policy to rescue the lame duck Rolls-Royce. Look at RR now - possibly the pride of British manufacturing.
Thatcher and her government put £12bn in 1983 money into BL/ARG from '79 to '86 which is about £50bn in today's money.
The big mistake in my eyes was not retaining their golden share.
You raving socialist.
Yes, I agree - although I am not a raving socialist - they should have persisted with it. That is the time when we had a Princess and a Montego and were satisfied with them (so now you can call me a raving loony).
In Berlin they have 'Trabi Safaris' - city tours using antiquated Trabants much loved in an 'Ostalgic' post-modernist way.
May I suggest a business proposition: tours around the Midlands (ex)industrial areas in reconditioned British Leyland models.
"Though cowards flinch and traitors sneer/
We'll keep our Princess on the road 'round 'ere!"
Absolutely.
I have close family ties to Rover, the Rover Car Company that is. That would be the car firm in the 1960s that regularly invited their Japanese and German counterparts to show them how to make cars.
My uncle did his apprenticeship as a draughtsman, moving through design before ending up as a department head in Special Division. It broke his heart to see good innovative design either get sat on by government (or the ever-so-loyal penny-pinchers) or worse, see the bolshie workforce make a total Heath Robinson of it.
Things did improve under Michael Edwardes and Graham Day to a point but by then the long-term damage had been done. The plant was simply too far behind the game and the unions were still resistent to any kind of Japanese lean practices or modern machinery. He went freelance in the 80s as he saw the writing on the wall. He's now working in a UK design studio designing cars that are made abroad.
The criminal shame was MG Rover was a reformed firm but starved of product investment, the plant was excellent and the workforce had been turned round with excellent flexible processes and good quality management.
Heartbreaking to see the plant shipped to China along with the best engineer brains in the firm.
I see him from time to time and ask how work is "No b*oody unions" is the stock reply which is an family joke.
A criminal shame though. We could use £1bn a year in exports right now.
I'm am not convinced that Mandleson would have done anymore beyond 'assurances', even if the 2002 legislation had not been passed.
you would do well to ponder how government might work more efficiently and effectively with business - the engine room of the nation - rather than simply how it can further interfere, stifle and handicap it.
...value generated and wealth created all the way down the food chain. that's capitalism. be grateful for its fruits...
OK, let me get this right.
Suppliers get screwed because of greater buying power;
Customers get screwed because monopolies or duopolies are created;
Employees get screwed, because of redundancies.
Managers and shareholders make out like bandits.
This is wealth creation for the few,not the many, and these fruits of your dead-beat bankrupt Capitalism are Dead Sea fruits.
We need a new co-operative capitalism where the interests of managers are aligned with other stakeholders, and there is no need for unproductive shareholders, who represent costs for other stakeholders, and should therefore....to borrow the rhetoric, be cut.
It was the Enterprise act that removed any public interest test from the process of approving mergers/takeovers beyond whether competition would be affected.
That legislation was put through by this Government by Patricia Hewitt in 2002.
Without it Mandelson could have actually have done something rather than just pretend to be tough.
There was scope for intervention in takeovers on the grounds public interest until 2002. Labour got rid of it. Another instance of this government having been to the right of the previous Conservative one, which is why some of us can't stomach the "progressive" narrative.
I can accept that their products pluck an emotional string among those who like such tat. (These same people probably have a warm spot in their hearts for the bloody awful British cars that Rover/BL produced in the past 40-50 years...)
Funnily, with over 90% of Cadbury's production and staff is overseas, I heard no words of anxiety about the outsourcing this 'strategic' industry until very recently.
Always bought British-made cars, never eat Cadbury's - Fairtrade Co-op 85% cocoa solids @ one square each day.
I was refering to those British cars produced under the BL marque.
Over the past 40 years none of the Top 100 US companies have ever been acquired by outside interests; quite rightly, the US and our so-called partners in the EU will not permit the takeover of strategic industries. Over here we create ever more jobs for lawyers and hide behind EU legislation whenever leadership is required.
Erm, what about the reign of Red Robbo and his Communist shop-stewards. Forgotten comrades Anthony?
BL (not Rover, more about that later) was an prime example of the State being in control.
The collection of British car manufacturers in the 1960s in private hands made some of THE best cars in the world to making some of the worst in the 1970s in government hands.
Rover, one of the UK's finest car manufacturers and innovators became a moniker slapped on the BL created rubbish. It did enjoy a renaissance in the mid to late 1980s with a partnership with Honda but ultimately it was Labour happy to see a major strategic industry that exported £1bn worth of goods go under for want of a £120m of loan guarantee.
Labour killed the British Car industry, its invention and talent has been well recieved elsewhere.
As for Cadbury, that's business, what should be happening is British firms taking over foreign ones but when a government saddles taxes, additional regulations and costs on them, they simply cannot compete.
It should be a lament that Labour killed the golden geese that laid the golden eggs with its social costs and taxes.
Or in the words of one Government Minister "They can all get jobs in supermarkets."
The loss of Cadbury's was the consequence of leverage by private equity companies in this country making a quick buck - financed, sadly enough, by RBS because the government has a hands-off approach to RBS and Hester keeps blackmailing the government.
If the utilities had not been privatized by Thatcher, they wouldn't be in foreign hands now - shareholders just want their returns and don't bother about who owns the company.
I think it was Ricki who asked about the closure of coalmines. Well, it wasn't the Labour government which closed them. The pits were privatized in 1994 and Richard Budge bought them (and was subsidized by government), consolidated as RBJ maining. Eventually, he closed all the deep mines and concentrated only on opencast.
So people should buy an inferior car out of a sense of National Pride?
Your namesake, whilst fighting on the Eastern Front in WW1, wrote: "The English - the best race in the world - cannot lose". I'm pretty sure that even this ardent anglophile would have bought a German car in preference to the equivalent British make.
Local government workers received their salaries from the country and bought foreign (mainly Japanese) cars. I dealt with a lot of steel shelving companies and each of their reps drove a foreign car (such as Fiat).
The steel shelving companies were British too.
We bought British-made cars as a matter of reciprocity. Why should anyone in this country pay for my services if I do not, as far as possible, buy goods manufactured or assembled in this country? Many people here declare that they want people to be employed rather than dependent on the state - that was the opportunity to do something about it.
The Rover 75 was certainly not inferior, 28 international awards and a very capable car. 100% designed and built in the UK using 70% British parts.
The rest were certainly near the end of their life but they were by no means worse than other offerings in the market, certainly better quality than their French & Blue Oval counterparts and could give some German cars a good run for their money.
All I know is that whenever I encounter a doddering driver on a country road, they seem to be driving a Rover...
How well they've lasted - both driver and car.
They're always wearing a hat ;-)