Grangemouth: the facts as known
We’ve been digging around behind the scenes for the last few days now trying to make sense of the labyrinthine tangle of claim and counter-claim over what’s going on at the Ineos refinery and petro-chemical plant at Grangemouth. The press is full of competing assertions from the various parties involved, so we’re just going to tell you what we know for sure and see where it ends up.
– Ineos claim that the petrochemical plant loses £50m a year.
– This figure varies from day to day. Earlier this month they said it had lost £150m in the last four years,which would be a significantly lower £37.5m per year.
– In the same story, it gave the value of the petrochemical plant as zero.
– However, on its website it claims that the plant has lost £150m EACH year in that period, and is currently losing £10m a month: £120m a year, not £50m.
– Unite asserts that Ineos is profitable, making £2bn last year, and that its petrochemical operations are forecast to contribute £500m to those profits.
– It seems to be unclear whether the Grangemouth site specifically is currently profitable. We’re not at all sure we follow this seemingly contradictory quote from Gerry Hepburn, chief financial officer of Ineos Chemicals Grangemouth:
– At the end of 2012, Ineos invested in its petrochemical facility in Rafnes, Norway, a move about which it said “Well timed plans significantly strengthen the competitive position of Rafnes, Norway for the foreseeable future.”
– Ineos claims “The company would like to do the same thing at Grangemouth but the site’s lack of competitiveness makes the necessary investment difficult, without change”, and presents changes to workers’ terms as the way to address this situation, coupled with investment from the Scottish and UK governments to the tune of £150m – half the £300m cost of new ethane-handling facilities.
– Separately to the costs issue, there’s an ongoing dispute over the activities of the site’s Unite convenor Stephen Deans, who is the subject of an investigation by Ineos over the alleged use of company time and premises to pursue matters relating to the selection of a Labour Party candidate for the adjoining constituency of Falkirk to replace Eric Joyce, the formerly Labour, now independent MP who is standing down in 2015.
– Labour conducted its own inquiry into the behaviour of Mr Deans, including involving the police, but exonerated him of any wrongdoing. It has refused to publish the results of the inquiry, or to apologise to Deans or Karie Murphy, the Unite member he wanted installed as the Labour candidate.
– Deans had been suspended by Ineos during the inquiry, which is due to reach a decision this week, but was reinstated pending the outcome after the union threatened to strike and close the entire facility (both the petro-chemical plant and the refinery) specifically over the company’s treatment of the union official.
– Although the union called off the strike, the company closed down the plant anyway, and it remains inoperative, for reasons which are unclear. Ineos had demanded the union pledge to call off any strike action for the rest of 2013, a demand the union has accepted.
– It appears that the company has seized the opportunity to conflate the issues of Deans and the new contracts, claiming the shutdown was a precautionary measure ahead of the planned strike, but refusing to fire up the plant again after the strike was called off unless workers also accepted the new working terms, which two thirds of them refused.
Those are the pertinent facts to the best of our knowledge. With the company having today announced the closure of the petrochemical plant with the loss of around 800 jobs, speculation is rife. It’s been widely claimed that if it goes ahead, petrol prices will rise by 10p a litre.
There have been calls from various sources for the Scottish Government to nationalise the plant, even though energy policy is reserved to Westminster. We haven’t a clue whether that’s a viable option or not, either constitutionally or economically, but it seems to us that even a loss of £50m a year (which is roughly 0.16% of the Scottish Government’s block grant) would be a relatively low price to pay to avoid the damage that would be done to the economy, both in terms of unemployment and the knock-on effects of that and of any rise in petrol prices.
(Presumably with Ineos having publicly stated that the value of the plant is zero, the capital cost of purchasing it wouldn’t be an issue.)
When placed in the context of the £4.2bn Scottish taxpayers will contribute to the HS2 rail project for the benefit of London, Birmingham and Manchester, it seems like small beer indeed. That sum would absorb the claimed losses of Grangemouth for 84 years.
The loss of Grangemouth would be a disaster for Scotland, and doubly so for an independent Scotland. The more extreme cynics in the nationalist movement have suggested the current state of affairs suits the Westminster government just fine, and the really extreme extremists claim the whole thing’s a conspiracy to that end.
We can only guess at the motivations of the parties concerned. If Ineos – whose CEO, billionaire Jim Ratcliffe, is widely portrayed as an exceptionally hard-headed and unsentimental businessman – is really making such a loss on Grangemouth, we can’t imagine why it would be trying to keep the plant open at all.
But on the other hand, if Unite are correct that it’s actually profitable, we also can’t see why Ineos would adopt such a risky blackmail, putting those profits in jeopardy for the sake of what in the wider picture is the fairly piddly sum of £150m in grants.
What seems beyond dispute is that the Stephen Deans farce has played into Ineos’ hands. Labour’s shenanigans have provided a smokescreen behind which the company has been able to push whatever its real agenda is. We hope those political machinations don’t backfire catastrophically on the whole of Scotland.
The whole thing just stinks ,
Notwithstanding the viability of nationalisation either constitutionally or economically it seems clear to me that we would be better placed if the Scot Govt had at least even a minor stake in major infrastructure to ensure transparency.
Now call me cynical, but this is all happening at the time the UK Government are rolling out a capital infrastructure investment fund…
http://www.bbc.co.uk/news/uk-politics-24621385
The £40bn UK Guarantee Scheme, launched by Chancellor George Osborne last year, is part of ministers’ efforts to encourage private sector investment and to boost spending seen as vital to the economy’s long-term development.
The new projects eligible for potential support are:
£300m biomass energy generation plant in Avonmouth, Bristol
£400m gas-storage facility in Islandmagee, County Antrim
Two gas-fired power plants in Lincolnshire and Essex
Mixed-used development of homes, offices and shops in Aberdeen
Wind farm on the Forth Estuary
Renewable energy port facility in North Lincolnshire
Chinook Energy renewable energy plants across UK
Gasrec low-carbon fuel plant for commercial vehicles
development of the University of Roehampton campus, Surrey
wood-fired generation plant in Tilbury, Essex
relocation of Northampton University
Five Quarter Energy gas plant in the north-east of England
ethane storage facilities at the Ineos Grangemouth plant near Falkirk, Stirlingshire
Oh, so money has been put aside for this upgrade by Westminster… interesting
Rev, you should remember that although the union called off the strike over Deans, they had already implemented a work to rule and overtime ban.
Quoted here from a BBC story:
‘Unite said the work to rule and overtime ban would slow down maintenance work at Grangemouth, which is split into refinery and petrochemical operations.’
http://www.bbc.co.uk/news/uk-scotland-scotland-business-24420533
An oil refinery that does not make a profit. WHIT THE
Thanks for this article! It does seem to me that Scotland has a strong strategic interest in keeping Grangemouth running, and that things look quite different from Westminster.
Anyway, I’ve found an article that places the closure in an international context: http://www.bloomberg.com/news/2013-04-04/europe-to-shut-10-refineries-as-profits-tumble.html
if Unite are correct that it’s actually profitable, we also can’t see why Ineos would adopt such a risky blackmail, putting those profits in jeopardy.
Could they transfer the work to the new plant in Norway and still supply the UK from there? That way they’d increase profits by doing everything from one plant instead of having the running costs of two?
Considering Labour MP Michael Connarty already accused the company & Westminster of collusion, I think this will run for a while yet!!
“The more extreme cynics in the nationalist movement have suggested the current state of affairs suits the Westminster government just fine, and the really extreme extremists claim the whole thing’s a conspiracy to that end.”
Currently I’m sitting somewhere in between “extreme cynic” and “really extreme cynic” in that case. I’m waiting to see what position the various parties in this take in the following days and weeks before I decide definitely. But so far those on the Better Together pages – assuming they’re a mix of Labour and Tory activists – are pushing me towards the latter. They’re jumping on this with glee as an excuse to bash the SNP.
I’ll give Labour and Tories more public spokespeople, MPs, MSPs etc a few days to convince me otherwise though.
You don’t need to be an extremist to see that sometimes political agendas needs to be nudged into place!
You have to only look at history see how many times England has pulled dirty tricks to trip up Scottish ambitions over the centuries. To help a single company decide to invest elsewhere with the outcome that Grangemouth becomes a political battle field, would only take a few phone calls.
How difficult is that to make a reality?
Just in case…..for those like me who might wish to express their feelings to Ineos these are their press contact e-mails worldwide richard.longden@ineos.com, katrien.poppe2@ineos.com, kevin.ratliff@ineos.com, anne-gret.iturriaga.abarzua@ineos.com, grangemouthcommunications@ineos.com, torhild.eidbo-hansen@ineos.com, erik.ronningen@ineos.com,ingela.frossling@ineos.com, craig.welsh@ineos.com, charles.saunders@ineos.com
This fubar just screams a mixture of self interest, incompetence and opportunism. UK gov are sitting on the sidelines doing SFA and washing their hands whilst the SG are actively looking for prospective buyers.
Stu
Your analysis is spot on. A company that was just waiting for the opportunity and they got it!
“Labour’s shenanigans have provided a smokescreen behind which the company has been able to push whatever its real agenda is.”
In a nutshell. But tomorrow, scores of voters will effectively endorse Labour’s behaviour, and by the weekend, the MSM and BBC Better Together will have presented the whole episode as a disaster for self-determination and its evil totem, Salmond.
“The loss of Grangemouth would be a disaster for Scotland, and doubly so for an independent Scotland.”
The SG can’t let this one pass – it’s time for stand.
Yes this is a disaster for Scotland, but as part of the Union, we are better able to withstand shocks such as this and also the banking failure.
Dont shoot me but you just know whats coming, if Salmond doesnt play a blinder!!
“by the weekend, the MSM and BBC Better Together will have presented the whole episode as a disaster for self-determination and its evil totem, Salmond.”
Yup. And I don’t think you have to be that extreme a conspiracy theorist to believe that’s what it’s been about all along.
So how many Scottish Labour MPs stayed behind in the Commons, after today’s PMQs, to hear the Coalition’s Energy Minister, Ed Davey, make an emergency statement on Grangemouth?
Answer on a post-card to
Johann Lamont
Leader of Scottish Labour
Bunker HQ
Glasgow.
INEOS has been building a plant in Norway, it is possible that they intend to use that as their main base and had no intention of continuing operations at Grangemouth http://www.ineos.com/en/News/Shared-News/gfd/
Also there was a report of unusual accounting policies fro the Sunday Herald.
http://www.heraldscotland.com/news/home-news/ineos-a-company-with-a-habit-of-making-good-on-its-threats.22469392
It’s all very strange, and would most likely take a serious effort in forensic accountancy to determine who is telling the truth on the issue of the site’s profitability. My thoughts go out to the workers whose jobs are under threat and the surrounding community which will be affected to a great degree. My brother stays not far from Grangemouth and it will undoubtedly have a devastating impact on their small village (recovering yet from the mine closures).
We may never get to the “true” profit or loss at the Grangemouth site.
Within multi national companies you can have internal sales (maybe at cost plus, i.e. not an external market price) as well as the murky world of transfer pricing where global management & admin overheads can be added to product costs and show “profitability” where it incurs the lowest level of Corp Tax.
This whole thing stinks. I hope something can be done by the SG to support the 800+ workers that are currently under threat.
So Scott Minto, the money is already there waiting for an opportune moment to save the day?
Terrible news. The implications of this are absolutely huge. Unite really should have seen this coming. Our thoughts have to be with those affected workers and their families.
Put me in the ‘OMG, really, really extreme cynic, with shifty sideways glancing eyes’ category then. I could see this coming – it’s no surprise. I think Ineos were denied their loan, decided to ditch Grangemouth – and what better way to do it than to blame the unions. Wouldn’t put it past Westminster to have slipped them a backhander to do it too…
…but then, maybe I’m just being cynical.
Another example of Union bloody-mindedness playing right into the hands of those with an agenda. It is these types of shenanigans that allowed Thatcher to rape this country and be seen to be on the right side of history at the time.
If it is possible, the Scot Gov should nationalise the plant and state in no uncertain terms that if the workers want to continue their professional lives there they have to budge a bit so it can be profitable. It is in everyone’s interest that the biggest oil producer in the EU has some control of over the processing of the product.
Susan S says: “I think Ineos were denied their loan, decided to ditch Grangemouth”
According to Ed Davey the company had not submitted an application for a loan at this stage.
The Ineos chemical plant (which remains wholly owned by Ineos) may well be worth nothing, but the refinery is owned 50/50 by Ineos and Petrochina under the Petroineos brand. In 2011 Petrochina were reported to have paid $US 1 Billion (£626 million reported at the time) for this 50% stake in Grangemouth refinery and a 50% stake in a similar sized refinery at Lavera near Marseille together with a linked ‘sales operation’. All figures relating to Ineos are of course impenetrable by design.
Better together will ‘save’ the plant, as Scott has pointed out.
I’d be pretty dis-chuffed if I’d paid 1 billion usd for something that lost money for a while then was closed down. Surely these Chinese investors will have something to stay on the matter…
Cath – “But so far those on the Better Together pages – assuming they’re a mix of Labour and Tory activists – are pushing me towards the latter. They’re jumping on this with glee as an excuse to bash the SNP.”
Yep, I made the mistake today of replying to some dimwit saying that it “happened on Salmond’s watch”, and got a raft of Rangers fans trying to tell me this was the SNP’s fault. Utterly unbelievable – if anything, they’re the sole innocent party in this. It’s the same as usual – SNP try to clear up someone else’s mess, and somehow get blamed for it.
I can’t help feeling it’s going to reach a point where anything but a Unilateral Declaration of Independence is irresponsible. We can’t wait a year (or until 2016, really) for things like Grangemouth to be sorted.
As I said on Twitter, anyone who calls for the Scottish Government to nationalise Grangemouth who is planning to vote No next year is a total hypocrite. To be honest, anyone expecting the Scottish Government to be the ones to sort this out who is planning on voting No is a hypocrite. This is national government stuff. If a plant that was crucial to the German economy was being closed down, it’s the German federal government you would expect to be dealing with it, not the government of the state that it happened in. The leader of the country should be getting stuck in here, and so far I see a lot of Salmond and not a peep from Cameron.
This should serve as a perfect example to people of why we need a government that puts Scotland first.
Just saw an interview with Salmond and says he is concentrating and getting both parties round the table one last time. When asked if nationalisation was possible, given Prestwick airport, he says the difference was that with Prestwick we had a willing seller and therfore there were no difficult legal issues. He didnt really rule it out and from what he says, looks like Scot Gov has at least had a look at the possibility.
@Bunter
Possibly, but its rock and a hard place time. They spend the cash to save the jobs and an important part of the country’s infrastructure, then wait for the other shoe to drop as Labour kick in with well why didn’t you use this cash to save x, y, or z? Why didn’t you use the cash to pay for a year of the bedroom tax? Why didn’t you use the cash for… etc
Best outcome is for the SG to be seen either arbitrating a solution or providing a new buyer. Last ditch is the possibility of nationalising the plant. But like the Rev says, is that even possible?
On the point about Gerry Hepburn’s claim that the figures have been checked by a reputable firm of accountants, that doesn’t necessarily mean much at all. Leaving aside the question of whether there is any such thing as a reputable firm of accountants, all they really do is check that the sums are right. And, maybe, have a look to see if anything seriously illegal is going on. What the auditors won’t do is point out devious, but entirely lawful practices.
An illustration might be in order.
Suppose you own a bakery. Not a nice we village bakery making fresh rolls and scones for the locals. A big bread factory churning out tens or even hundreds of thousands of branded loaves every day to be shipped to shops the length and breadth of the country.
Your bread factory sorry… your bakery is in competition with another just like it a few miles down the road. For both, the principal input is flour.
Now imagine that you also own a flour mill. The only flour mill in the country. Your flour mill supplies both your own bakery and the one owned by your business rival. You have to decide what price to sell your flour at. Competition laws prohibit you setting different prices for different customers. So, what do you do?
You could set a fair price for the flour thereby allowing both bakeries to make a reasonable profit. Or you can set the price at a level which makes it all but impossible for either bakery to run at a profit. You lose nothing as you have effectively transferred the profitability of your bakery to the mill. And you get the added bonus of taking a chink of the profits from your rival.
It pays you to run your bakery at what looks like a loss.
There is nothing illegal about any of this. On paper it looks perfectly legitimate. And the auditors would have no reason to comment on the arrangement. But, equally, it creates an entirely false picture of the financial viability of your bakery. A picture which can be used to extort concessions from workers.
Meanwhile, the costs of inefficiencies are passed on to customers while the pressure on margins makes investment in the plants impossible. Or provides an excuse to defer such investment. Eventually, one or both of the bakeries is forced to close down because they can’t compete with the mega-bakery that has been built 400 miles away in another country. All the workers lose their livelihoods and supplies of bread now have to be trucked huge distances.
But you’re not bothered. Because you are still supplying the flour from which you make all your profit.
The point of the story (or, at least, one of them) is that a business may be making a loss on paper. But it ain’t necessarily so.
Sorry, me again, article just appeared in The Herald and we are all saved as A Darling is now on the case! Both Govs must work together as this leaves a huge hole in Scotlands economy or words to that effect.
Could it not be a 50/50 partnership with SG If there are competition/legal/financial impediments? Is Statoil a free phone number?
Compare and contrast:
Alex Salmond – “I am not accepting that Grangemouth is going to close. I can’t accept that because it is too important.”
Ed Davey – “saddened” and “should redundancies be made, support will be available”.
I know who I would want on my side fighting for my job!
A point not noted but Grangemouth and Forties are linked, indeed Grangemouth provides power to Forties and the Forties pipeline could be closed as a result of Grangemouth closing. Check out the podcast (and can someone download it please? You need to sign up) here:
http://www.platts.com/podcasts-detail/oil/2013/october/oilmarkets22?sf912744=1
http://t.co/caonlWEfLi
Call me cynical but yesterday I passed Mossmorran and it also appeared to be shut , anyone know why ?
I wonder if the best thing for Scottish Govt to do is to make it clear in EVERY statement and interview about this that the responsibility for Grangemouth is Westminster. They can continue to do their best, but it has to be made clear who is responsible for what in the UK/Scotland
Magnus Linklater in The Times was saying today that it’s Salmond’s responsibilty to sort this out, or words to that effect. No shadenfreude there at all, no sir.
Norman Smith, BBC’s Chief political correspondent, “A slap in the face for Alex Salmond and independence”
It didn’t take long for the BBC to blame the Scottish government.
A simple search for facts regarding the petrochem market will show that European demand for fuels has been falling for years. There is excessive refining capacity all across Europe which means that only the most modern & efficient plants will survive. However, additional, efficient & competitive refining capacity continues to be developed in the Middle East.
While not having site specific financial reports, it is likely that Grangemouth has been shutdown because it is simply less efficient (i.e. more costly to operate) than other similar facilities in the UK and in Europe.
Unite & Labour have given Ineos a perfect cover because they used the impending strike as a justifiable reason for closure. It’s favourable in political terms too but it seems to me that Ineos would have shut it down anyway. Unite’s heavy handedness seems to have brought forward the decision rather than delay it.
While Grangemouth may well be important to the economy in general, it behaves just like any other manufacturing asset in private hands. When it is no longer profitable, the losses will be sustained only until they are untenable & there are no reasonable alternatives. Ineos will know the impact upon Scotland but they are in the business of making money, not providing welfare & a social safety net; that’s one of the purposes of national government.
I ran a $billion manufacturing budget across multiple regions so have first hand experience of these types of situations. That many of our refined products might now come from somewhere else should be of little concern to the general public because they are being produced at lower costs. This is good. Of course that is no comfort to those losing their job.
Having said all that, it is likely that some production streams inside the refinery may well actually make money but the cost of running the entire site makes those small positive cash contributions meaningless.
It always bothered me anyway that I could smell hydrocarbons when I drove along the M90. The upside is that our air quality in central Scotland will likely improve now that the flares, stacks & atmospheric vents are closed for good. Perhaps the values of homes near Polmont might even go up !
We all know it will make no differance to the Dunfermline by election (Labour shoe in); but lets state the facts anyway for any undecided voters.
As headlines should be –
“Labour’s shenanigans lead to closure of Grangemouth plant “
what public will get from BBC & MSM is –
‘Alex Salmond closes Grangemouth’
any takers ?
@Macart, Bunter
It’s probably worse than that: In about Summer 2014 Ineos comes along and says ‘Now we are thinking about closing the refinery. Since you require it for your petrochemical plant what you have acquired from us, O foolish, independence-minded people, we are quite sure you will either give us a lot of money to keep it going, or else buy it from us before we demolish it….”
@Cath
But so far those on the Better Together pages – assuming they’re a mix of Labour and Tory activists – are pushing me towards the latter. They’re jumping on this with glee as an excuse to bash the SNP.
This comment touches on something that I have been pondering lately. Why is it that, whenever things go wrong in Scotland under the Union, such as the industrial vandalism of the 1980s, and this situation just now, Scottish Unionist activists come out and say the: “if we were independent now we would be fucked” line?
The truth, and it is staring them right in the face, in 50 foot capital letters, is THAT IT FUCKING OCCURS UNDER THE UNION YOU MORONS….Why do they automatically see the financial disasters of RBS and the Bank of Scotland in 2008, and this economic blow to the Scottish economy just now, as somehow damaging to the case for independence? It genuinely perplexes me because it literally makes no sense at all. Then they come out with all the “proud Scots” line!…They see economic problems for Scotland has essentially good news. I really wish plus 40 per cent of the Scottish electorate could waken up, and finally see what being a Unionist in Scotland entails. They are being taken for a ride by their politicos.
Well, one thing that is certain is that those intransigent, incompetent fat cats at Unite will still remain in their “jobs”, even as 800 invaluable manufacturing jobs and livelihoods (and many times that number in supply train secondary firms) are lost. Scotland’s great curse is that it still saddles itself with the moribund, useless, Union-infested politics of the 1970s – IMO of course.
Magnus Linklater in The Times was saying today that it’s Salmond’s responsibilty to sort this out, or words to that effect. No shadenfreude there at all, no sir.
Magnus Linklater is officially an idiot.
O/T warning. https://mobile.twitter.com/MagnusLinklater/status/393005712504152065?p=v
“I can’t help feeling it’s going to reach a point where anything but a Unilateral Declaration of Independence is irresponsible. We can’t wait a year (or until 2016, really) for things like Grangemouth to be sorted.”
I feel that too but it just can’t happen at this stage in the debate. Can you imagine the wailing and teeth gnashing? The only way it could possibly happen would be if Labour in Scotland, along with the unions, came on board with the idea we need independence, and we had a cross-party, all Scotland consensus that to prevent more damage it needed to be done now, with the referendum going ahead but mostly to affirm the decision. Again, nice to dream but I don’t see that happening.
“Labour’s shenanigans have provided a smokescreen behind which the company has been able to push whatever its real agenda is.”
That’s one of the real problems.
I took dogs abuse years for opting out of the levy paid to the Labour Party, I believe strongly in trade unions but I want nothing to do with the Labour Party and the harm they do to Scotland.
I don’t want to pay for my union official to be involved in Labour Party business and I certainly don’t want to help subsidise the Labour Party to stand up in Westminster or Holyrood to run my country down.
There’s a lot yet to come out about what’s being going on in Grangemouth but the shenanigans with the Labour Party in Falkirk have certainly not helped.
While I get the issues on the petro chemical industry challenges I simply cannot be persuaded that Scotland should ever be in the position of importing petrol or diesel.
It is strategically negligent to be dependant on imported fuels when you are Europe’s third (I’m putting Russia and Norway ahead) largest oil producer. There is also the issue of skilled engineering jobs being at stake.
So could the Scottish government step in and nationalise what the unions claim is a profitable plant?
This could be Plan C (nationalisation), after Plan B (find another commercial operator), after Plan A (get both sides talking again).
OK I know what is going on at ineos . Alex Salmond is fat so they are closing down
UCS style work in?
No getting away from the fact that INEOS were just waiting for a chance like this but – since we live in a blame culture, I think the smart focus in this matter is how it all started in the first place (all those who are losing their lively hoods – listening?).
A Labour party official / union member and subsequent shenanigans related to the said Labour party caused this fiasco that has now back fired on you all and looks like it will cost you your jobs; mind and tell the Mrs & the kids that fact.
No amount of Bravado / Brinksmanship and other union shit can resolve this now.
Why not take your spite out on the said ‘Labour Party’ for all their recent help
Gillie
I think you need a Plan D (SG + private operator joint venture) – like Norway’s main refinery where their government own a 50+% stake.
Ineos workers should just get in there and fire up the plant and have themselves a ‘work-in’ – just ike the old days. Just remember thoguh, in the words of the late, great, Mr Reid, “There will be no vanadalism, there will be no hooliganism, there will be no bevvyism…”
YES Scotland.
Murray,
I absolutely agree with you, but unless you are prepared to build a modern, efficient refinery from scratch which produces products that will still be profitable in the face of falling European demand and can compete with cheap US gas and Middle Eastern labour costs, you are left with no alternative but to heavily subsidise a ‘strategic’ industry (which will have no incentive to modernise or compete).
Which was Labour policy in the 1970s…. Didn’t work then, and even less likely to work now.
@Major
Magnus Linklater in The Times was saying today that it’s Salmond’s responsibilty to sort this out, or words to that effect. No shadenfreude there at all, no sir.
I cannot understand this mentality of some Scottish people towards their own nation. They seem to react with glee to very bad news about Scotland. I find it creepy and strange.
@Gillie
Norman Smith, BBC’s Chief political correspondent, “A slap in the face for Alex Salmond and independence”
It didn’t take long for the BBC to blame the Scottish government.
Your link does not work.
Message from SG should be “Westminster should take responsibility or, in the interests of Scotland we declare UDI!”
@Kininvie
Wouldn’t surprise me. I’d prefer either arbitration or new buyer personally.
That being the case and since the door is already opened on a later closure of the refinery, it may be worthwhile greasing the wheels of a total buyout of the site. I believe the FM when he says that he cannot accept that this plant will close and I reckon he’ll move heaven and earth to come up with some sort of solution. Whether he’ll be successful or not is another animal, but if anyone’ll put the effort in, it would be him.
Bill Fraser says:
‘INEOS has been building a plant in Norway, it is possible that they intend to use that as their main base and had no intention of continuing operations at Grangemouth’
Slightly misleading Bill. There is a plant there already, INEOS are just adding an ethane storage tank. This is one of the first sentences from the article you provided the link for:
‘INEOS is to invest in the construction of a new ethane tank at its Rafnes site in Norway.’
INEOS also said this is what they wanted to do at Grangemouth. They would invest £300m while they would ask the Scottish Government for £9m in Regional Selective Assistance and the UK Government for £125 in secure loan guarantees.
This would enable the plant to bring in Gas from around the world to fire the plant. It would also mean that local deposits of gas would not be needed, ie, no fracking in Scotland.
kininvie
You have just described the UK nuclear power industry there. It recently got some future “investment” from us taxpayers.
I would not rule out investment in a new refining plant in Scotland. I would probably site it in the NE to minimise costs.
I know this is not straightforward, but am depressed watching this unfold and the UK government simply being “sympathetic” spectators.
BBC report on Salmond comments:
‘Alex Salmond has said he is not prepared to accept the closure of part of the Grangemouth petrochemical and refinery plant.
The first minister told BBC Scotland: “I am not accepting that Grangemouth is going to close. I can’t accept that because it is too important.”
Workers at the site had earlier been told by site owners Ineos that the petrochemical plant will close.’
So Plan D it is (SG + private operator joint venture).
Lets make it happen.
“They seem to react with glee to very bad news about Scotland. I find it creepy and strange.”
Yup, and still the Facebook pages of Better Together are full of that same glee. I’m waiting in the fond hope some of the Labour and union activists within that campaign will actually stand up for Scotland and for the people and families, and the communities and towns, that are going to be horribly affected by this. Not a peek, all SNP bashing.
Until I see Labour types stand up and say something else, I remain in the “extreme cynics” camp on this one. This is Labour-Tory working together to screw Scotland. Win at any cost at all. I really, genuinely want to be proved wrong but it needs some decent “Scottish” Labour (or indeed Tory) folk with back-bone to do it. Are there any left?
If China stat has an interest in Grangemouth I wonder what their thoughts on it are ? could they be reimbursed with a nuclear power plant
Surely it cannot be beyond the wit and wisdom of Management, Unions and both governments, if they are ALL keen on the truth being known and the best outcome for the future coming about, to setup a joint, neutral but experienced body to investigate the issue and then give a report on what should be done to secure the plants future, what should be retained and what, if anything, should be closed or sold off,
That’s if anybody apart from the Scottish government really does have the plants future in mind!
Folks, this is an economic decision made by an international refiner operating in a market that is suffering from falling demand, falling wholesale prices & overcapacity. Grangemouth was less efficient than other refineries & consequently was losing money. It’s an unsustainable position for any business to incur chronic heavy losses.
Lots of countries import their refined hydrocarbons just like they import bananas or cars. You should be pleased that the cost of producing will now be lower, not higher. This is how the free market works.
The Ratcliffes and Trumps – must never be allowed to kill off ordinary hard working folks lives in their own community where they have the right to its natural wealth and the skills to enjoy it.
Ratcliffe’s behaviour is ruthlessly criminal.
Nationalise all our natural wealth and put it in the hands of the people.
I would hope that neither a British government or main opposition party would have colluded in this matter, although I am not yet convinced they haven’t, but what I do expect is that they will do nothing or little to help rectify the matter, because that is not in scotland’s interest.
It’s flip-side of the ‘something for nothing’ hysteria – skilled workers can’t have decent pay and conditions.
They’re getting too much. They should be happy to do it for less – they should be grateful they’ve got a job at all…etc.
I was listening to someone last night (who runs a small cleaning company) saying that she receives letters every week from women who are offering to work for NOTHING just to ‘get a foot in the door’.
What a fucking rotten stinking society we’ve become. Heartbreaking.
Sometimes I think we are really going to do it, and get a Yes vote next year. I felt like that on the independence rally last month. Other times, like today, when some people in Scotland think it a good idea to gloat over major economic problems here, I think it is a lost cause. I really cannot relate to this triumphalism by Unionists. The degree to which some people in Scotland are die-hard British nationalists is eye opening. They really do not want Scotland to be successful at all. I genuinely do not know how the SNP and the Yes campaign can put up with so much entrenched hatred and animosity that has been thrown at them over the years. All because we want to see our nation govern itself.
Mags Curran has spoken, “Ineos are turning the clock back on industrial relations in this country. The workers at Grangemouth have been treated terribly. The responsibility of the UK and Scottish Governments now is to come up with a plan to save the plant and the jobs that rely on it. Grangemouth is too important to the Scottish economy, and too important for the hundreds of people employed there, to be allowed to lie idle. Now is the time to put political differences aside and join together to get Grangemouth working again. The company now need to take their ultimatums off the table, accept the guarantees given by Unite, and restart the refinery.”
It is a pity she was posted missing when the Energy Minister, Ed Davey, gave an emergency statement in the Commons about Grangemouth today.
I wonder where she was hiding?
“Another example of Union bloody-mindedness playing right into the hands of those with an agenda.”
Seems more like they were forced to play a no-win scenario.
INEOS so-called terms were pretty much shafting the workforce. So if the union sits back and does nothing, they get accused of abandoning the workers they’re supposed to be standing up for.
And as we’ve seen, if they try to fight back, they get accused of making things worse.
No-win scenario. Plain and simple.
All the blaming and finger-pointing is a waste of effort now anyway.
Whether or not it was a conspiracy is also meaningless, the damage has been done. Now we need to figure out how to patch it up quickly.
BT are already using this as a weapon. And it just might be the one that convinces the remaining “Don’t Know”s that Scotland’s economy is now too damaged to sustain itself.
I’ve never been a massive fan of Salmond (though I’d prefer him over Labour or Tory any day!) But I’m really hoping he’s got a trick up his sleeve to deal with this…
@Cath – Just tweeted a clown, who claims he is having fun winding up SNP members. I told him it was a sickening comment and he obviously had no thought for the families who will suffer because of this. However, that is it, not good for the blood pressure and I will not react again. Unionist glee at an unfolding tragedy is quite unforgivable.
Readers, I’m really busy today. I’ve got to pop out for a bit now, and if I have to come back to an hour-and-a-half’s worth of tidying up comment formatting like some of the atrocities posted in the last couple of hours I might just pack in the whole thing, mmkay?
Please.
If you’ve got something to say, don’t just spew it onto the page like a Jackson fricking Pollock painting, present it as if you actually want people to be able to READ it.
JoLa has rushed out a press statement to the BBC from her bunker, “The Ineos announcement isn’t just a hammer blow to the people of Grangemouth and the surrounding communities, it is a hammer blow to the Scottish economy and the rest of the UK. I am glad that the Scottish and UK governments are working together and pledge my support in getting the refinery open again, and finding a way to keep the petrochemicals plant open. Ineos should get round the table and negotiate rather than issue ultimatum after ultimatum. Workers around Scotland and the UK have shown a great degree of flexibility during the global downturn since the banking crash. But it cannot be right in 21st century Scotland that an employer demands that a worker accepts cuts to their wages, their pensions and their conditions, and are told to either agree to them within 96 hours or face the sack. That is a Dickensian way for an employer to behave and cannot be tolerated. There is a committed workforce at Grangemouth. If the Ineos management is equally committed to their business they will negotiate with their workers not threaten them.”
Sorry Rev, my fault everyone.
Thanks for tidying up my post, I’ll be careful in future.
There are several points I wish to address here:
Macroeconomic strategy; Scotland and Norway are Europe’s major oil producers and will continue to be for decades. so oil, and its downstream industries starting with petrochemicals are of strategic importance ,no less than banking and finance are to London.We therefore strategically should protect these industries just as the UK protects London banking.
To allow the Grangemouth petrochemicals plant to close is that old Colonial trick again that I’ve described before. Buy and import from Grangemouth the bulk products from the refinery, process them to add value and then sell them back to the “natives” in the UK. Can you visualise that Ineous’ strategy is perhaps to process the Norwegian refinery bulks of their new petrochemicals plant in Norway plus process exported bulks from Grangemouth to Norway and then export the added value plastics etc ,,,to the UK?
This is raw business competition we are facing. Norway has a financial stake in its refining industries so unlikely that Ineous could try the reverse of what I’ve described and sell Norway bulks to Grangemouth for added value processing and resale back to Norway.
It is reported via the Bloomberg article posted above of an overcapacity of refined fuel in Europe. It must be the refineries that import crude for processing that fall not the refineries of crude supply countries, as is Scotland.Our industry, and the country must set itself to weather whatever financial difficulties arise due to overcapacity.
Then we have industrial relations and attitude.There is an article on Newsnetscotland -Workers’ rights and independence. It is to be hoped that the writer will not be in any negotiating team. “Neo -Thatcher assault,shadowy Swiss based oligarchy,viscious assaults, pistol to the head and etc. It is arbitration that is needed not confrontation.
Eric Joyce has different take on things compared to Mags and JoLa,
“Labour’s position on the Unite/Ineos dispute is now unambiguously to support Unite, which includes the continued threat of a strike. One Scottish shadow cabinet member, Drew Smith MSP, attended a rally on Sunday and has made his supportive position clear on social media. Another shadow cabinet member, Neil Findlay MSP, a Unite member, has also put out an unambiguous statement in favour of Unite and condemning the employer. The Leader in Scotland, Johann Lamont, a Unite member, has condemned only the employer and has cleared her shadow cabinet to take sides. The shadow employment minister, Ian Gray, also a Unite member, has had nothing at all to say all in spite of the actual Employment minister leading the argument for the Scottish government. Labour in Scotland is looking more like the Scottish Unite Party right now. At present, Ed Miliband seems to have been bounced into an anti-employer position when it’s clear that Unite has handled the dispute appallingly. Unquestioned support for a highly questionable Unite action will have dire consequences. He needs to step in, now and make it clear that Unite needs to start operating like a serious trade union, and Scottish Labour like a serious political outfit.”
‘ But it cannot be right in 21st century Scotland that an employer demands that a worker accepts cuts to their wages, their pensions and their conditions,’
Excerpt from Gillie’s post, I wonder if JL has said the same to Stirling Council?
“Italways bothered me anyway that I could smell hydrocarbons when I drove along the M90. The upside is that our air quality in central Scotland will likely improve now that the flares, stacks & atmospheric vents are closed for good. Perhaps the values of homes near Polmont might even go up !”
I am glad to say that thankfully that was the case when Ravenscraig closed. A huge improvement to the environment. I live beside the Clyde a couple of miles downstream from Motherwell and the difference since “The Craig” shut is vast.
Just to add a miniscule drop of comfort. Out walking my wee ginger dug this morning and although it was only a handful of folk that I talked to “word on the street” is that this is all the fault of the unions and Labour.
@ Dave Whitton – While I agree with most of your post I assume your reference to Trump is regarding the new Golf Course at Balmedie, Aberdeenshire? If that is so I cannot agree with your implication that the under threat ‘hard working folks’ of Grangemouth bear any similarity to the folks of Balmedie where employment increased during the construction of the golf course and still does.
Quote:- “Bill Fraser says:
23 October, 2013 at 2:02 pm
INEOS has been building a plant in Norway, it is possible that they intend to use that as their main base and had no intention of continuing operations at Grangemouth http://www.ineos.com/en/News/Shared-News/gfd/Also there was a report of unusual accounting policies fro the Sunday Herald.http://www.heraldscotland.com/news/home-news/ineos-a-company-with-a-habit-of-making-good-on-its-threats.22469392
If Ineos are known have a track record of unequivocally carrying out what they promise to do then why oh why did the Trade Unions think they could win this one?
Well said they men Doug Daniel/ Peter Bell ( is that why James Masons loafs are so dear ) I digress At the top James Cook says Ineos loss £50 mil Calum Mac Lean (ineos ) said they had lost £150mil a yr for the last 4 yrs A Darlings school of accountancy but these companys are Tax Avoiders never get the full account of their profit Starbucks example buying their coffee from Switzerland ( a coffee produseing country ah dint think the work force of G/Mouth should seise control of the plant the whole of Scotland would be behind them ( no sit in workin in a stand must be made)
We need to have a close look at what Camerons announcement today of reducing green subsidies on energy bills has regards Scotlands drive for renewables and re industrialisation. This could be another blow, as they say…..
Good piece Rev.
You’ve done the best you could with the information available.
In my opinion Grangemouth MUST be saved somehow either by a new buyer or nationalisation, if possible. It seems to me that Ineos are holding the workforce, and to a larger extent the Scottish Government to ransom.
Mr Jim Ratcliffe, of whom Ive read, owns over fifty refinery type plants all over the world, knows full well, what he’s doing, and if Grangemouth is indeed a profitable plant, it seems as though this fiasco is all about cutting labour costs, to gain more profits.
I think if Alex Salmond handles this one right, he could come out of it smelling of roses and boost the independence vote, the opportunity is their to be won.
O/T BASF, in Renfrew are to shed jobs, the timing couldnt have been worse.
http://www.bbc.co.uk/news/uk-scotland-glasgow-west-24638168
Has ineos , vitol & better together any overlapping interests?
@G H Graham,
It’s an unsustainable position for any business to incur chronic heavy losses.
Obviously: but it’s entirely unclear whether or not the business was incurring chronic heavy losses. As Peter Bell pointed out in his bakery analogy, multinationals can shift profit and loss around to suit their tax needs.
Until we know whether the whole petrochemical plant could be run profitably under a different owner, or what it would take to make it do so, it’s wrong just to give up on it, especially given the human costs involved & the supply chain implications.
At the very least, I hope part of the SG’s contingency plan is to get into the plant and do some due diligence, so that any potential buyer (including ourselves if it’s to be part SG owned) will know the truth. At the moment I can’t find one single figure for the petrochemical business that I can believe – so it would be a good starting point to have some.
“There are several points I wish to address here:”
I’ll address YOUR sodding points if you don’t start putting proper paragraph breaks in, pal.
no Oneironaut they ‘werent forced to ‘ they were so busy playing the man , the ball completely flew over their heads . Anyone heard a comment from Mr Mclusky or Johann Lamont for that matter .
Yes all workers need someone to stand up and fight for decent conditions but they need people who can see the big picture not rhetoric from the 70s and I say that as someone with Family whose job is a trade Unionist
Jesus Pat Rafferty was on yesterday saying we’ve had workers contact us from Lanzarote on their holidays,really helps the PR for the workers , I don’t think.
you summed it up nicely Muttley 79
Considering Eric Joyce’s words what part did Johann Lamont play in this industrial dispute?
Was she supporting and urging UNITE to take industrial action?
It suddenly has gotten darker. Was Scottish Labour politicians involved in UNITE taking industrial action at Grangemouth?
Peter Bell’s earlier comments about the accountants and the treatment of the capital expenditure got me going off on a bit of a tangent.
Although it’s accepted accounting practice to ‘book’ capital assets to the Balance Sheet (thereby benefitting Balance Sheet ratios), it’s certainly not illegal to book the expense to the Profit & Loss, thereby reducing profit and Corporation Tax payable (no word from Osborne, Alexander or Hodge on this ‘shifty’ practice though).
The thing is, an auditor has a statutory obligation to verify that any accounting treatment adopted will result in the company operating as ‘a going concern’. By calling in liquidators, Ineos must surely be questioning the integrity and authenticity of the auditors. Maybe the auditors should sue.
Ratcliffe also stated that he moved the HQ to Switzerland because HMRC refused time to pay (TTP) arrangements for. £360m VAT bill.
HMRC are culpable for many things but, when a business, especially a business the size of Ineos, is facing hardship, every effort is made to accommodate (sweetheart deals).
Before agreeing TTP though, HMRC do a thorough analysis, often forensic analysis, of filed accounts and future cash flow and accounting forecasts. If HMRC refused Ineos TTP, it would have been on the basis that the ongoing business was viable and profitable.
Calling in liquidators therefore questions the integrity of HMRC.
To me, something is afoot here, and it ain’t adding up to twelve inches.
Hullo is that Mr INEOS?
Yes!
Its Johann Lamont here!
Who?
Johann Lamont, JoLa!
Who?
Leader of Scottish Labour!
Who? What?
Och forget it! <click>
BBC duly report that Johann Lamont doing all she can to end fued while SNP continue their ‘grandstanding’
“they ‘werent forced to ‘ they were so busy playing the man , the ball completely flew over their heads .”
Was it a co-incidence the union action – initially started over the Labour selection row – was timed to co-incide with the SNP conference?
I really feel for the workers and ordinary union members at this plant. They’ve been totally screwed over by their management. But they have also been hugely let down by their union and political leaders. I think Molly is bang on there – so busy obsessing about the SNP and “getting Salmond” they weren’t even looking at the bigger picture.
@Papadocx
Has ineos , vitol & better together any overlapping interests?
Oh, I love puzzle-type quizes. I’ll have a go. Is the answer that Vitol in the United States produces cheap ethane from fracking and Ineos needs cheap ethane from the United States for the petro-chemical plant. But if Vitol got permission to frack in the Central Belt, there would be cheap ethane locally to feed Ineos’ petro-chemical plant. Oh, and Vitol funds Better Together for no apparant reason – or maybe it suits them or energy policy to stay under the control of Westminster. In a United Kingdom context, with Labour in control at Holyrood and any of the mainstream parties in control at Westminster, maybe the permission to frack would be granted?
Did I win anything?
Labour clearly aren’t in the clear on this though:
“Labour MPs have told The Scotsman they believe Scottish leader Johann Lamont is “not in control” of the party after senior figures at Holyrood openly came out in support of yesterday’s Unite strike.”
http://www.scotsman.com/news/politics/top-stories/grangemouth-labour-row-reheated-by-dispute-1-3149253
(apologies for the full link).
Scotland Tonight are having an hour long prog devoted to discussing Grangemouth problem tonight from 10.30.
Eric Joyce has confirmed he will be on and Scotnight are also looking for workers from the plant to appear on prog too.
This from the IHS Chemical week website
NEWS ALERT: Ineos to close Grangemouth petrochemical complex
Ineos announced today that it would close the Grangemouth, UK petrochemical complex and that the PetrolIneos joint venture would decide on the future of the adjacent refinery. The development follows the breakdown of talks at the Advisory, Arbitration, and Conciliation Service (ACAS) last week and the Unite trade union’s refusal to provide a no-strike guarantee before the company restarts the complex, which has been offstream since last week.
Ineos also approached its employees directly, asking them to support the changes Ineos considers necessary to save the Grangemouth petchem business. “Regrettably, the union advised union members to reject any form of change,” Ineos says. The outcome of the employee vote on the company’s ‘survival plan,’ which includes the termination of a final salary pension scheme and a pay freeze, was a 50-50 split. Almost all of the administrative staff at Grangemouth voted for the company’s plan but a large majority of shop-floor employees voted to reject it, the company says.
Observers say the decision announced today may not be the final outcome. “Ineos would still prefer to have Grangemouth running and if the unions were open to negotiations, the complex may restart,” says Matthew Thoelke, director olefins and derivatives/EMEA at IHS Chemical. Ineos said previously that it wants to make investments at the site of some €300 million to build ethane-importing facilities and make some adjustments to the plants. Longer term, it said it was planning to expand the larger of the two crackers significantly.
Thoelke says the site “may well reopen.” Even if it goes into liquidation, someone is likely to acquire some or all of the facilities. However, new owners are unlikely to have the advantage of Ineos’s existing arrangements to import ethane from the United States. And even if the whole of the Grangemouth capacity was removed, there would still be enough ethylene to meet European demand, Thoelke says. [more]
If you want to see the complet piece click on the link below.
http://www.chemweek.com/home/top_of_the_news/Ineos-Grangemouth-petchems-complex-to-close-liquidators-appointed-within-a-week_56109.html?utm_source=CW+Breaking+News&utm_medium=email&utm_campaign=20131023_BN
vellofello says:
‘Can you visualise that Ineous’ strategy is perhaps to process the Norwegian refinery bulks of their new petrochemicals plant in Norway plus process exported bulks from Grangemouth to Norway and then export the added value plastics etc ,,,to the UK?’
Once again, it isn’t a new plant, it is an existing plant that is having a new gas storage tank built so that cheaper gas from around the world can be imported and used. This is what the company suggested happens at Grangemouth and what the £300m investment was for.
Ineos already have an existing plant in the UK that manufacture plastics – at Newton Aycliffe in County Durham (PVC) the largest site of it’s kind in Europe – the plant that processed vinyl in Hull is to close down (announced two weeks ago).
They also have the Runcorn site that produces acids, caustic soda and PVC, the only one of it’s type in the UK.
I don’t know whether or not those facilities received any products from Grangemouth (the Hull plant did) – it could be the case that they rely already on imported raw materials at present.
Just a point of clarification on the numbers around this issue may or may not tell us.
Its great that the Rev has pulled together everything that’s been reported in the one place. However while they appear contradictory its quite possible that all of the numbers that the Rev pulled together in the article can all be correct – it depends entirely on what specific numbers you are looking at and in which time period.
The profit / loss can be different depending on whether you are looking at EBIT or EBITDA (the latter excluding depreciation on capital investment which could be significant in that type of plant). If also depends on how the treatment of for example write-off of equipment or other accounting factors.
The loss can also vary significantly from month to month depending on production levels, costs of materials, plant efficiency etc (so taking an annual number and dividing it by 12 isn’t necessarily accurate)
It also depends on which companies you look at. In something of this size there will probably be a variety of different legal entities (Limited Companies) in some kind of Group structure, and its quite probable that not all of them are UK based companies.
Without looking at the full sets of accounts, and understanding the group structure (i.e. which companies own which other companies) then based on the numbers being thrown about its impossible to know what the true picture is.
Given that there are a number of other plants in the group operating in other countries INEOS will have a number of scenario plans to expand / shrink or exit various parts of that whole jigsaw which they will have available to implement depending on different circumstances.
There may be a solution to this, but it would require a very good understanding of the data and the bigger picture issues that are driving Ineos decision making.
Whether the SG is able to get close enough to that to be able to make a difference I don’t know. Lets hope so.
As JP mentioned, The Forties are powered from Kinneil. During the 2008 shutdown, its alleged 70 fields had to cease production. Why is there not a cheep from BP this time? Is it just the petrochem side shutting down and crude refining and the Forties power stays on? I’m no expert so can’t say if this is feasible or how the divisions are operated.
It was also stated that there was a reserve of fuel for 70 days held at Grangemouth in 2008. Is this shutdown just a standoff again to secure government investment, break the unions and push fuel prices up?
The UK government has been spinning all year about potential power blackouts, to try and push for new (Chinese/French) nuclear at Hinckkey etc.
Scotland is being briefed on the volatility of oil and how it can’t be relied on and wouldn’t cope.
Finally, as Private Eye reported last week, the OPA, the UK pipeline agency and pipelines are being privatised. How are all these interrelated? I don’t know, but I’m sure they are.
link to OPA story
“Has ineos , vitol & better together any overlapping interests? ”
Someone posted this the other day:
http://www.linkedin.com/pub/tom-ramsey/51/663/939
Ian Brotherhood
It’s flip-side of the ‘something for nothing’ hysteria – skilled workers can’t have decent pay and conditions.
This is it Ian. Where is this culture going to end? Everyone is expendable, worthless and ready to be cast aside!
I am also very suspicious of companies that buy organisations and then start to tinker years later with pension rights. If this really was an issue don’t buy the company, or at least make it clear before purchase and get agreement at the outset.
I haven’t bothered looking at BT’s page but if they are gloating I am a tad confused as to why. This is a Labour/Unite/Red in tooth and claw Tory Capitalism show. It has occurred in our wonderful Better Together Union. It had nothing to do with the Scottish Government, the SNP or the move to independence. The loss to the workers and the support services that supplied Grangemouth is not less because of the Union. They are out of a job and that is the only thing that matters. The Union has not saved them. An independent Scotland would not make them twice as unemployed or something equally McDougallesque.
@Ivan McKee
Do you think the S.G can get another buyer in? Is nationalisation a realistic option, or is it not possible?
Oh, I’ve got a quiz question to set for anyone who knows the answer.
Why was Unite asking the workforce to strike over the treatment of one employee? Surely if Mr. Deans was subject to a disciplinary investigation (and I assume, though suspended, he continued to be paid pending the outcome of said investigation), then Ineos has policies and procedures in place, agreed in conjunction with the union(s), that have to be followed. If they don’t follow their own procedure, they can automatically lose at any subsequent Industrial Tribunal, just for not following procedure alone. That’s what usually happens.
The procedure, as I understand it, hasn’t yet concluded. Usually, on conclusion of the procedure, if an employee is found to have done something wrong, sanctions are then applied and the employee appeals. If the appeal is not upheld, then the employee can consult a lawyer. I would think Unite members have access to legal advice via the Union.
So, if there are policies and procedures in place and Ineos is following them, why was the union threatening strike action? Just wondering.
Thanks for the post Ivan – very helpful.
Can the Scottish government force Ineos to open their books, or would those books be so opaque they wouldn’t mean much anyway?
According to Reuters, Ineos owns 100% of the petrol-chemical plant, whilst Petrol-China owns half of the refinery, with Ineos owning the other half.
Ineos operates Grangemouths Refinery solely with the consent of Petrol-China.
This has me wondering just what Petrol-China have to say about this situation, do they agree with Jim Ratcliffes postion? or do they disagree?.
http://uk.reuters.com/article/2013/10/21/uk-scotland-refinery-offer-idUKBRE99KOF120131021
Well, I thought that the issue of the Unite official, came up by chance? just before the SNP conference and the Dunfermline bye election. Their talk of strikes played right into the companies game and here we are.
I saw somewhere that the Boss of the company is a friend of David Cameron, tie these together and it begins to smell. We have the involvement of SLAB and UNITE, with a possible connection back to Cameron. So what motive would there be more them to orchestrate such a bad event if such were the case?
Well, I suppose it would come down to the objectives and the benefits to those involved, excluding the actual workforce. Something to speculate on ?
Can I just echo what Muttley (I think) said, while trying to ensure no cite tags?
The point about the glee of unionists when things go wrong for Scotland is exemplified by an overheard conversation at Pisa airport on Saturday, between a Scottish Daily Torygraph reader (self-confessed), and an English traveller. The Scot told him he would just love it if Wales or England discovered oil, so they could then say, ‘Off you go then.’
The conversation was content-free, consisting solely of 2 or 3 statements of opinion. It ended when other travellers joined them, but at that point the Scot had just opened with, ‘If Scotland should choose to go to war…..’ Staggering.
He turned and looked at me when his mate had gone off and I held his gaze steadily, inviting him to comment or expand on his thinking. Okay, I was dressed like a cool Italian, but the red hair tends to give the game away. I wasn’t going to initiate any confrontation, but I was prepared to give him some facts. He didn’t take the invite.
Ian its deals within wheels am their wheels keep on turning makin money wheres the high heid yin o Unite Mc Cluskey wheres Slab Lamont its a fit up for SNP OIL no making money WTF
Cath @ 4:17
Probably, to the second part. It is difficult enough with accounts published by a UK based, and bourse quoted company, but a Swiss based one operating in many different product area, in many different plants and many different fiscal jurisdictions make it impossible except from the inside to do what everyone here wants. So the answer to the fist question is simply No.
@HandandShrimp
The UK/British way of doing industrial relations has utterly failed. All it has done is pitted workers, represented by the trade unions, against the management of companies, in pointless conflicts with each other. We should look at how Germany does it. These industrial conflicts in the UK are destructive. Both sides just pose for their own sides, while the workers lose their jobs.
O/T but
I have my Notify me of follow-ops ticked but never get a notification now to subscribe to these from WordPress and thus no update on new posts.
Have I missed something because the blog has grown like Topsy and the notifications would have become a deluge?
anyone care to wager that these ‘losses’ exist only on paper as part of a well constructed tax avoidance scheme?
One other thing that occurred to me was those figures the UK government were releasing which we were all surprised about because they showed Scotland doing so well. We wondered then why they were doing it. Was it because they knew they were going be deliberately tanked this year in comparison?
Is this another way of looking at it ?
Ineos were prepared to invest £300m in updating the plant and make it possible to accept imports of cheaper Gas from North America.
They ask the Scottish Government for £9m in Selective Regional Assistance and the UK Government for £125m in loan guarantees (whether that money is actually paid out I don’t know, the word guarantee to me means an ‘insurance’ policy.’)
They want to do this because they claim the Gas supply from the North sea is swindling and their is no local supply.
What they mean by no local supply is there is no ‘fracking’.
So, if the cost to the Scottish Government and Westminster was a potential £9m (accepting that the £125m is just a guarantee and never actually paid out) then that potentially seems like a very small amount to pay to:
a) keep the plant open and secure it’s future
b) not losing 800 jobs and paying them dole (God knows where those guys are going to find another job with their unique skill set)
c) not have any need for fracking in Central Scotland.
I may be completely wrong but it seems worthwhile to turn the scenario upside down and see what we get.
As it is, the reality for those 800 workers is that now they have no pay and no jobs instead of a reduced package, the dole queue awaits them.
If I was in their position I would have accepted the offer and while I was working either start applying for a new job elsewhere or if there are no other jobs elsewhere, stick with what I’ve got because it’s better than the dole.
@tartanfever
paying the blackmailer is better than having the compromising pictures published in the dailies, it doesn’t make it the right decision
Whilst there may be some sort of tie with Cameron, Vitol and Ineos I would be surprised if Unite/Labour are part of the merry game. Ineos have been gunning for Unite for years and the Falkirk debacle was a flimsy excuse for Ineos to move against a shop steward and try and force the closure/pay/pension cuts thing.
If the plant is really losing money hand over fist Ineos will willing walk as the Prestwick owners want to. If they start throwing up excuses and are loathe to step aside then I think it will become obvious they are playing fast and loose with the numbers and cost cutting and union breaking is their real game.
Bugger the Panda I must be gettin aw your posts lol
Caroline, we gave Amazon £10m in regional investment for the distribution package centre in Fife – this is exactly the same thing.
So the blackmailer was paid.
Ooops, my previous post meant to say ‘dwindling’ not ‘swindling’ !
@ Cath
At the end of the day if INEOS don’t want to do a deal then there’s not a lot you can do about it.
BUT these are Business people so there’s always a deal to be done if the numbers are right.
If the government calls you up and says they want to talk about a potential deal then of course you talk to them. The worst that can happen is that you carry on executing on your current plan, and there is always the possibility of new money or a different kind of deal being worked out that is a win-win.
Again it comes down to the business structure and the numbers.
Provided people are talking behind the scenes, and are willing to lay cards and options on the table then if there is a deal to be done it can be worked out.
Whether the numbers stack up though we don’t know.
And while you an pull accounts for a UK based company (and for the annual reports of the group) and get a pretty good picture of what the lie of the land is, if there are numbers hidden away in Swiss companies as someone suggested then its gets more difficult to get the full picture without INEOS opening up.
Welcome back jeannie.
@tartanfever
Your Freudian slip is showing!
oh goody the commentor who ran the billion pound company thinks it will be GOOD for the Scottish people to pay 10p more per liter just as long as ienos makes a BIGGER profit.yea thats really going to help Scotland
Several boffins on Radio Scotland saying, its not just the workforce at Grangemouth who will lose their jobs, due to Grangemouth closing, thousands of other Scots who rely on Grangemouth via other firms could lose their jobs as well.
Not to mention the terrible economic effect it will have to the surrounding areas, the said boffins claim that if Grangemouth closes for good, Scotland will never again have such a prolific refinery.
Is Grangemouth a Ravenscraig in the making, I sincerely hope not.
SG should give Ineos a token couple of quid for the petro-chemical plant and tell them to frack off, then offer the whole refinery to PetroChina with certain guarantees including SG keeping a 20% stake over the next 10 years.
A wee sum.
1400 employees receiving salary and pension package @ £40,000 a year = £56 million.
If it’s the workers terms that are the problem, and you reduce the pay package to £25,000 a year, that’s still costing £35 million a year.
FFS
@John H
🙂
Nae Tax avoidance schemes in a Independent SCOTLAND westminster looking after their pals cameroon will pop up soon Ineos are no welcome in Scotland now Yes supporters should rally in protest at G/mouth supporting SG & making that very clear to all we cant afford to ignore this situation
If the petro chemical refining is financially unsustainable, I wonder what the figures look like for the oil refining that remains once you add overheads that must have been shared across the site?
Given the age of Grangemouth and the investment that is still likely required, even in the smaller site, I assume that will be the next step by the owners in seeking a state contribution?
Interesting background article from The Oil Drum 2008
http://energyandourfuture.org/~europe/node/3907
I heard on the radio that the average wage was £55,000. No doubt, anyone that doesn’t understand what an average is will be shouting ‘greedy bastards’.
Worth a read. SSP National Workplace organiser Richie Venton
http://richieventon.blogspot.co.uk/2013/10/statement-on-grangemouth-by-ssp.html?m=0
From a friend:
Grangemouth now providing fuel for N.Scotland using cheaper imports. Gov. fuel price reduction for the same area. Fuel for the rest of Scotland being provided by Newcastle. Fuel shortfall being imported into S.England(cheaper). Who’s benifiting?
The narrative is becoming clear. The presenter on BBC News24, during a discussion with an INEOS director, just stated that Scotland isn’t competitive. The whole shenanigans is a British State black op. Folk may think that statement is silly.
Remember that the British State has killed hundreds of thousands in past independence conflicts, so a few thousand folk losing their jobs is nothing to them.
“I heard on the radio that the average wage was £55,000. No doubt, anyone that doesn’t understand what an average is will be shouting ‘greedy bastards’.”
I’ve little doubt that most people who DO understand what an average is will be shouting it too. Of course, you can add pension costs and other benefits into that sum as well – all at a plant losing money hand-over-fist, and you can bet the unions resisted every single working practice change, every efficiency, and most certainly every wholesale pre-major investment step change to salaries, benefits etc., as they have done. Their idiocy and greed has cost their members and their country very, very dear.
As an aside, who is it who ends up paying for this vastly skewed salary/benefits gravy-train (and month on month plant losses) – that’ll be the hard-pressed British motorist or oil-fired CH owner, then, struggling to make ends meet in employment (if they’re lucky) not so fortuitously oil- and cash-soaked. Personally, I think most outside of the oil game have had just about enough of spiraling energy bills of one type or another, myself included.
I wonder…………….possible next location of the Grangemouth Petrochemical plant equipment?
http://cbi.typepad.com/china_direct/2013/10/ineos-and-sinopec-break-ground-on-largest-phenol-acetone-plant-in-china.html
(apologies for long link)
Since this company is based in an offshore tax haven,does it contribute any tax to the Scottish eceonomy?If not,what exactly does it contribute beyond employment?
Seems to me that Ineos’s real agenda is to maximise profits by cutting operating costs. Steven Deans was used as the catalyst to close the plant thus holding the workers to ransom. Legislation is required which forces companies to open their books to union and/or independent accountants, it would be obvious to all sides when a company is in trouble and the union would have the responsibility of convincing the members that current remuneration packages are unsustainable.
Penalties for pochling the figures should be harsh.
@CC.
It never took long for your Thatcher underpants to start showing.
@Captain Caveman;
That’s Daily Mail info – an operator’s typical pay is £55K. There are not 1400 operators at Grangemouth.
The Scottish Government, via SEPA, should withdraw the environmental discharge permits from the whole operation, on the grounds of irresponsible actions by the licensee (Remember, Ineos were at pains to point out that a shutdown/re-start posed risks!). Having done that, the asset value of the whole plant really would be zero!
Then await further developments………….
(An intimation to Ineos that they will be pursued for the costs of returning the whole site to green field status may also focus their thoughts a bit.)
Sorry Rev, but the layout I see posted above is now I typed it, 5 paragraphs, one line spacing between each. Is it all merging into one when I press the Submit button? Two spaces between paragraphs the answer?
@Juteman
I’ve never denied it. However, care to actually engage my points though, or are you just going to play the man, not the ball?
Grangemouth town centre has been swamped today with press and broadcast media asking residents and shopkeepers what effect this closure will have on the town.
Apart from the obvious answer, I told them that I blamed the Scottish MSM for not better informing Scotland’s people of what actually happens in their country. That they only print whatever their editor’s favourite Political Party/Spad wants us to hear.
The goings on at Ineos have been the main topic of conversation in the town for the past few weeks. If the MSM had done a bit of research into the owner of Ineos they would have learned that he is a self made, hard headed, billionaire businessman who puts his company and his profits first and foremost. They would have learned he does what he says he’ll do. They’d have learned that he has petrochemical plants elsewhere in the world that are cheaper to run, more profitable, and, according to him, have a more skilled workforce, and, he claimed, that due to costs, Britain is not an attractive place to manufacture. They would have seen the writing on the wall.
Had the Scottish media reported these facts the workers (not to mention the trade union) would have known a bit more about the kind of person they were dealing with. They may still have voted as they did, but at least they’d have been better informed.
I was asked “How do you think it will effect the town’s businesses”. I told him the 800 or so people just paid off are not interested that Greggs might not sell as many sausage rolls in future – That it’s time the Scottish MSM upped their game, ditched the trivia and started reporting the realities in life.
I told him that there was no point saying anything to the press as they never print what you say. He said he would print exactly what I said. I told him, Print this: “That the only way ahead is for Scotland to become independent – That the only way for us to deal with these matters is to be in charge of our own affairs – vote YES next year. He said: “My editor won’t allow that”.
@Atypical_Scot
Sorry, I was just going off what Juteman had said. Mind you, £55k seems like a pretty high (basic?) salary for an operator; no doubt overtime and shift allowance etc. on top, and most certainly pension and other benefits. Compared to other jobs in other sectors, I suggest that is a lot of money.
When oil was discovered in the North Sea the whole thing was played down and hidden from the public. Burma oil a very large capable old Scottish oil company was allowed to go to the wall. If I remember correctly LPG tankers were involved at the same time that oil prices were tripled overnight. luckily for the labour government that solved the Scottish dream of having oil and a company capable of managing it. Uk government was there to save us from ourselves again thank goodness. or maybe they are the bad luck
@AtypicalScot
I’m not sure that SSP statement helps anyone much. Nationalisation may be all very well, but there are no figures…no suggestion of how the plant might continue to operate without massive taxpayer subsidy…indefinitely… I think there’s enough rhetoric floating around. What we need are costed solutions.
Let’s not let them (BT), forget one simple thing – this all happened under the control of the UK parties (still a reserved matter).
Hey remember – we’re all better together apparently.
Remember that UNITE and the guys at the plant, mind and tell the wife and kids ah ‘What the fxxk’ it was only a job anyway but never mind cause >>
We’re ‘better together’ with the UK (apparently ?)
@ velofello – Just to help you, yes you are right double line space between paragraphs will do the business. Think on old typewriters and bash it twice, for real safety bash it thrice. 🙂
@Captain Caveman,
Nuc Power industry plant operators on £70k+, inc shift pay and o/t, Engineers can top £100k with shift pay and o/t.
@Captain Caveman;
Operators are the ones in charge of not letting it blow up. I’d pay them well.
@Kininvie;
In the SSP statement it reads;
“They’ve paid no UK taxes for at least the past 5 years. And again contrary to their lie-machine in recent weeks, in 2011 Grangemouth petrochemicals made operating profits of £31m – which rocketed to £49m last year.”
After paying the staff, they made millions. How much more costings does one need?
kininvie
“What we need are costed solutions”.
I agree with that. However, are you ruling out promising the plant operator twice the market rate for whatever they produce. That is a [incredibly expensive] costed solution.
We seem to being spun a story that nuclear = shiny, good and cheap. Oil risky, expensive and bad.
@CC.
If I earn £10,000 for cleaning the toilets, and the director earns £200,000, what is the average wage in this 2 man company?
I won’t debate with a creature that attempts to link the wages of ordinary workers, to the high prices charged by energy companies.
I would urge every SNP group / YeS campainer,s group that are available to swamp Dunfermline & help Shirley Anne Sommerfield get elected G/Mouth is the start of the dirty tricks this is the start of the fight for our INDEPENDENCE get the message out
@Atypical_Scot
“Operators are the ones in charge of not letting it blow up. I’d pay them well”
Sorry, no. That kind of trite argument just doesn’t wash with me I’m afraid. A nurse routinely saves people’s lives; a fireman stops plenty of things from “blowing up” (and works in far more hazardous environments) etc., yet we don’t pay these people £55k basic + overtime + benefits + generous pension. I know a thing or two about manufacturing also, and I know there are very few, if any fully skilled manual workers on this kind of money.
Bottom line – it’s only ’cause it’s oil that this situation has been allowed to develop, and like I’ve said, it’s ultimately the consumer who pays, not just in Scotland but also in the rest of the UK, most particularly the very hard pressed north of England. Being the private sector (albeit belatedly), the day of reckoning has finally come – either get real, realign with the other 99% of the UK, and we’ll secure your jobs and spend billions to re-modernize your plant. But what do the Unions do? You guessed it; strike and strike again, attempt to hold a gun at the company’s head (in fact strike over the treatment of one bloke IIRC?), all at a plant losing many millions. It doesn’t take a business genius to see how that is going to pan out. (See also the rest of UK manufacturing/the unions in the late 1970s).
‘It is perverse in the extreme that an industrial complex that accounts for 10% of the nation’s GDP, and 85% of fuel supplies in Scotland, as wells it’s implications for the key Forties oilfield, is in the hands of one man – a tax-dodging multi-billionaire to boot. This one fact captures the lunatic immorality of capitalism as a system. Profit is all. People are pawns.
Ratcliffe declares the site ‘worthless’ and in need of huge public subsidies, and yet INEOS’s own company accounts confirm that last year sales jumped by 50%; gross profits rose by 20%; operating profits leapt by an incredible 56%.
So oil-rich Scotland has only one oil refinery, and it’s fate is in the hands of one venture capitalist!’
http://richieventon.blogspot.co.uk/2013/10/statement-on-grangemouth-by-ssp.html?m=0
@Murray McCallum;
Apparently, the refinery is has been running at under 60% capacity in the gas sector. To a dog like Ratcliffe, that’s enough reason to jack it all in even if there’s some profit still to be had.
@ Captain Caveman
This major industry failure all happened under the governmental economic control of the current UK system and its parties (still a reserved matter); do you agree ?
Are we still better together ?
Caveman says ‘ £55k basic + overtime + benefits + generous pension’.
Links please, or you are talking shite.
@Atypical Scot
Sorry – I half discounted those figures. I’d love a source for them, because they run directly contrary to what Ineos is saying about losses. Operating profit (EBIT) is profit before interest (and tax): so does the interest payable (which no doubt Ineos may juggle with) turn these profits into the losses we hear about?
“If I earn £10,000 for cleaning the toilets, and the director earns £200,000, what is the average wage in this 2 man company?”
Duh, and how many directors were there out of that 1400 head count or whatever it was? I *seriously* doubt it was 50% as per your little example – or even 2%.
“I won’t debate with a creature that attempts to link the wages of ordinary workers, to the high prices charged by energy companies”
Yeah, except the excuse that gets trotted out again and again by these companies, including to regulators under *huge* political pressure, is “rising business costs”. I don’t doubt that these claims are likely exaggerated, but completely untrue and wholly groundless? When even you come up with, and attempt to justify manual workers on £55,000 basic plus OT and generous benefits, in their hundreds, at a plant losing vast sums of money that can only be recouped by the consumer of the product – oil?
You can sidestep all you like, call me all the names under the sun for all I care, son. The empirical facts, however, including in this case, are writ large on the wall. They have been for the last 30 years plus.
“Links please, or you are talking shite.”
No need to link; I was just going off your earlier post in this thread…
And on that bombshell etc.
@CC-
What is it with you and the 70s? (All of a sudden, your handle makes grim sense.)
We’re in the twenty-first century. The UK Treasury loses approx. £120,000,000,000 every year through tax evasion, avoidance, and outright fraud perpetrated by these amoral State-backed sharks.
What next CC? Will the dead be lying unburied because of Alex Salmond and his Communist cronies in the Unions?
FFS man, get a grip, eh?
@Captain Caveman;
A Doctor gets around £80k. Fancy telling him he’s not worth it? What about the FM? If he falls asleep on the job, Falkirk doesn’t explode in a fireball the size of, well, Falkirk.
I think your rationale hinges on the average wage being less than half that paid to these chaps at Grangemouth. In my opinion, the average wage is too low. So it’s down to perspectives. If a living wage is supposed to be £10 per hour – £370 a week – £19,240 a year as a starting wage, where would you place a semi skilled employee? A City and Guilds? Degree level?
“This major industry failure all happened under the governmental economic control of the current UK system and its parties (still a reserved matter); do you agree ?
Are we still better together ?”
In fairness, I have not attempted to make a political point over this – my ire has been, and is, exclusively directed towards Unite (crikey, that’s a misnomer if ever there was).
I just reported that the BBC radio said the average wage was 55k, Caveman, and I’ve already mentioned what an average means. You turned that into ‘ £55k basic + overtime + benefits + generous pension’.
Care to explain?
@Murray
It’s all getting incredibly complicated, and I’m about to stop commenting, because I’m not an expert on any of this.
But nuclear/vs gas/vs renewables is basically a question of energy security – and there’s an argument that the EU has made such a cock of energy strategy that we are in serious danger of lights out over the next couple of decades. UK govt. is effectively over a barrel here.
But that’s a somewhat different argument to whether or not the G’mouth petrochemical plant can be pay its way. Apples and pears.
“Care to explain?”
Thought you weren’t debating with a “creature like me”, love? Tell you what buggerlugs, you address the points I leveled at you in my first couple of posts, in all seriousness and good faith, then I’ll think about addressing this. ‘Kay? ‘Kay.
@Kininvie;
Ineos pays no tax in the UK, so it’s not that. From what I’ve read, it’s a globalised competition problem, futures etc. If the top brass see Asia churning out greater volume of the same product and exponentially at that, why not cut losses before real losses actually occur? If you’re a dog of an employer that is…,
Enjoy the job losses Caveman.
I’m finished with you.
“Enjoy the job losses Caveman.”
Troll. I’m as upset as anyone to see UK manufacturing jobs go, for whatever reason but most especially through the short-sighted greed and stupidity of unions, and absolutely nothing I’ve said, in any of my posts above, even remotely implies any different.
Call me all the names under the sun, I don’t care. Rest assured I think you’re a feeble-minded idiot. However, don’t you dare to tell me I’m “enjoying” hundreds/thousands of people and their families being put out of work, or anything even remotely resembling it.
On the STV news there, we just had Scotlands’ First Minister stating that he had spoken with both Ratcliffe and the Unions and that there is a possibly of movement… then the Tieless Director guy for Ineos was interviewed and asked if Ratcliffe would change his mind. He said he; “could only take reports back and try and talk to Ratcliffe, but didn’t know.”
…The reporter signed off with; “It is unlikely that there will be any chamge in Ratcliffes decision”.
Screw the MSM! Mad!
Common Interest…
PQ Corporation is a joint venture between Ineos (40%) and The Carlyle Group (60%). Carlyle Group is of course famous for its cameo appearance in Michael Moore’s Fahrenheit 911 and having had both Bush Sr as an advisor and John Major as Chairman of Carlyle Europe.
Tax dodging Ineos have played their hand with part of the Grangemouth site.
If they really do choose (with state contribution?) to continue their interest in what remains, do we actually want them involved in this strategic Scottish industry?
unite has questions to answer too
@Atypical Scot
If you’re a dog of an employer that is…,
Indeed, there’s no doubt that Ineos is just such a dog. And I think we’d be well rid of them.
But the crucial questions remain:
If we (SG) want to nationalise the plant or do a J/V with someone:
1) Can the petrochemical plant be profitable as it stands?
2) For it to be profitable, would we have to impose the same kinds of T&C on workforce as Ineos proposes?
3) If it can’t be profitable, what do we need to do to make it profitable? And how do we do that?
4) If we can’t afford to make it profitable, what subsidy do we taxpayers have to come up with to retain it in current operation, and for how long? And is that subsidy worth paying to retain a strategic industry in our own hands?
All this talk of how much the people at Grangemouth got paid is a smoke screen. If you want to get paid that amount then study and apply for a job.
This was a giant company with a ruthless boss intent in expanding his personal wealth and power, did nobody notice? This fact (his actions in other areas are proof) combined with the culpable stupidity of Unite in deciding to take industrial action in support of a politically motivated shop steward at a time when the writing was on the wall for this petrochemical complex was a disaster waiting to happen.
In the parlance of the USA, Unite brought a knife to a gunfight and now we, the people of Scotland, are having to suffer.
And to think it all started with a drunken melee in a bar in Westminster HoP. You couldn’t make it up. Reminds me of an old poem. “For the sake of a nail a shoe was lost”
It’s very simple folks; there’s an oversupply & falling demand for petrochem products & fuels across the European market. That drives wholesale prices down eventually to a point where some production facilities are no longer profitable. Grangemouth is one of them.
The reasons appear to be relatively high labour costs combined with lower efficiencies. The cost of labour is usually negotiable while the inefficiencies can only be fixed with large injections of capital.
However, no company will consider investing while its employees aren’t willing to negotiate, especially when the future of the facility is at stake. Since the Union decided to stop negotiating all together, the company decided to withdraw its consideration for investment & opted to close the refinery.
Whether a site like Grangemouth should be nationalised is a different discussion altogether. Meanwhile, a loss making refinery has just been closed.
Any questions?
@Kininvie.
Re point 4.
In an indy Scotland, a refinery is a must, and the state must have some control.
1 question i would ask unite is, why do you have gangsters and middle aged men wearing an earing at the head of your scottish branch? they remind me of the scottish labour party heirarchy
I’ve lost track of developments in Grangemouth but one fact stands out.
The BBC is giving the affair an unusual prominence. They’re clearly enjoying themselves. They can sense a victory of some sort in several hundred people being made unemployed.
A few weeks ago I had an exchange with the Rev in which I insisted that most Scottish unionists were misguided rather than ("Tractor" - Ed)ous.
My opinion is changing rapidly.
First Minister, INEOS and STUC now also on Scotnight hour long prog on Grangemouth from 10.30, which I’ll watch.
Newsnight also having an hour long prog on Grangemouth from 10.30. Don’t know the line-up for that yet, but hope for the blood pressure of anyone watching, it’s not Brewer doing the interventions.
Question – will Prof Curtice make a guest appearance?
O/T Another major closure BASF Paisley plant to close with loss of 141 jobs.
Union Dividend?
Funny that the Westminster government had no problem at all with nationalising the banks in a crisis (including the ‘Scottish’ ones), so what’s stopping them now? And I bet ‘average’ salaries in the banks were a lot more than £55,000…
Alba4Eva:
The Scottish media (print and TV) are out of their depth dealing with important news and the effects of their broadcasts.
They like to play the heavy hitting journalist role, but are unable to understand real people are affected by them
That was what the Leveson Inquiry was all about but they still haven’t learned a single lesson.
Very good clear, concise post G H Graham, but in fact, inefficiencies can also be due to poor and outmoded working practices, as well as outmoded plant and equipment. In other words, inefficiencies are not always fixed with large injections of capital; all the shiny new equipment in the world will not help if your unionised workforce not only will not use it – but won’t accept its introduction (or changed working practice) on pain of all-out strike, and all the massive costs, customer failures and losses this entails.
I’m taking flak for harking back to the late 70s, but of course, this situation is a miniature reconstruction of pretty much the whole of British industry back then. As history shows, most of that was lost to more efficient overseas competition as well. As for whether or not nationalisation would be a good idea, well, once again, recent UK history of precisely the same era empirically demonstrates that this moribund, socialist thinking leads to disastrous results. Reading Thatcher’s autobio at the moment; the costs that the British taxpayer were being expected to spend in order to prop up the strike-ridden, gun-to-head-toting NCB, British Leyland, British Steel et al were utterly shocking and totally unsustainable; no wonder the UK was ruined. People want to go back to that…? Sheesh, time is a great healer, or more likely people have short bloody memories.
G H Graham:
Admirably succint.
But one question: Given the opacity of Inneos’ accounts & its structure, how can we be sure that Grangemouth is not profitable as it stands?
PS If you are going to write reasoned and to-the-point comments, can you please change your avatar? I keep thinking I am listening to JoLa, and it’s causing a mental dysfunction.
G H Graham
Are you the boss of Ineos?
@MajorBloodnok-
‘And I bet ‘average’ salaries in the banks were a lot more than £55,000…’
Although 55k might not be far off their average bonus?
@GH Graham.
You said ‘Meanwhile, a loss making refinery has just been closed.’
Any links to prove the refinery is making a loss, ignoring the fact that it is the petrochemical plant being closed? You can add a link to the losses of the petrochemical plant if you wish.
@Kininvie;
Unite and the SSP among others are adamant the petrochemical part is profitable, and making no loss. That is apparently Ineos’ own accountants calculations. However, the board and the MSM say it is not the case. What if Ratcliffe is withdrawing swathes of profits as salary, he is allowed to by capitalist rules?
@G H Graham;
Why should the workers be paid less at Grangemouth when Ineos invests in multiple countries at once?
Crivens – JoLa is also on Scotnight! Do STV have a direct line to the bunker?
There’s only one word for this whole sham: lunacy. Complete and utter lunacy. This system we have is so shoddy, corrupt and worthless that 800 people are out of a job because of petty, parochial squabbling.
@Doug Daniel“I can’t help feeling it’s going to reach a point where anything but a Unilateral Declaration of Independence is irresponsible. We can’t wait a year (or until 2016, really) for things like Grangemouth to be sorted.”
Exactly how I feel – frankly, I think that the SNP should’ve just declared independence as soon as they were voted in, it would’ve saved us a lot of bother. And yet, the fact that they’re holding the referendum in the first place shows that they care more about what the people of Scotland think than 300 years of Westminster rule. In those 300 years, there has never been a referendum on Scottish independence. Not even the Labour government of the new Scottish parliament saw fit to ask the electorate in an official context, preferring to just to carry on with their mandate of remaining in the UK for the 8 years they were in power.
300 years of the union, and we’ve never been asked if we want to remain in the union. Yet the SNP, who could easily have taken the electoral mandate to mean implicit support for independence, didn’t mak the decision without asking the people. That’s the difference between the SNP and the other parties as they currently stand: much as Labour talks the talk about being for the common man, and the Lib Dems waffle on about social justice, it took the SNP to ask the people of Scotland single biggest question in the history of the United Kingdom.
I do think that if the SNP do decide to “fast-track” the road to independence, it’s starting to get less and less unlikely the more this UK government and the system it upholds continues to make a mockery of the very idea of civilization.
Ian Brotherhood said: Although 55k might not be far off their average bonus?
Indeed. Lower end of the scale probably…
@CC-
Weren’t you working on a positive case for the UK? What happened? Some of us were looking forward to that a couple of months ago. Maybe I missed it.
Or what about addressing the details in Richie Venton’s blog, as linked by ATypical_Scot at 5.05?
Okay, tempers are running high, and you’ve as much right to chip-in your tuppenceworth as anyone else, but whatever your motivation for popping back in right now, please understand that your particular world-view is pretty hard for some of us to stomach.
Enjoy the rest of Mrs T’s autobiography (but don’t tell us the end, eh?).
“Exactly how I feel – frankly, I think that the SNP should’ve just declared independence as soon as they were voted in, it would’ve saved us a lot of bother.”
There’s the small matter of a significant majority of Scots, according to polls, *not* wanting independence? Besides, the SNP have dragged their own heels on this long enough, have they not? The referendum could’ve been done a year ago easily, let alone late 2014!
I was listening to the news the other dayI heard a fat politician who had the nerve to sayHe was proud to be Scottish, by the wayWith the glories of our past to remember”Here’s tae us, wha’s like us”, listen to the cryNo surrender to the truth and here’s the reason whyThe power and the glory’s just another bloody lieThey use to keep us all in lineFor there’s no gods and there’s precious few heroesBut there’s plenty on the dole in the land o the lealAnd it’s time now to sweep the future clearOf the lies of a past that we know was never realFarewell to the heather in the glenThey cleared us off once and they’d do it all againFor they still prefer sheep to thinking menAh, but men who think like sheep are even betterThere’s nothing much to choose between the old laird and the newThey still don’t give a damn for the likes of me and youJust mind you pay your rent to the factor when it’s dueAnd mind your bloody manners when you pay!And tell me will we never hear the endOf puir bluidy Charlie at Culloden yet again?Though he ran like a rabbit down the glenLeavin better folk than him to be butcheredOr are you sittin in your Council house, dreamin o your clan?Waiting for the Jacobites to come and free the land?Try going down the broo with your claymore in your handAnd count all the Princes in the queue!So don’t talk to me of Scotland the BraveFor if we don’t fight soon there’ll be nothing left to saveOr would you rather stand and watch them dig your graveWhile you wait for the Tartan Messiah?He’ll lead us to the Promised Land with laughter in his eyeWe’ll all live on the oil and the whisky by and byFree heavy beer! Pie suppers in the sky! -Will we never have the sense to learn?That there’s no gods and there’s precious few heroesBut there’s plenty on the dole in the land o the lealAnd I’m damned sure that there’s plenty live in fearOf the day we stand together with our shoulders at the wheelAye there’s no Gods
@AtypicalScot
This is exactly what I keep banging on about: How can we know the real profit/loss figures for the petrochem plant?
Only way I can see is for SG to stick a team of accountants & petrochem experts into the plant and do a thorough due diligence.
Pay to keep workforce on books for the time that takes.
Only then can we make a sensible decision
@Ian Brotherhood
Sorry mate, my temper also runs very high when it comes to people losing manufacturing jobs in the UK, I’ve been one of them for a start.
Sorry about the case for the Union etc., I just haven’t been able to do it. Hopefully I can still chip into discussions though.
As for my political views, it’s just *so* frustrating for me when I see intelligent people seemingly deny the empirical evidence of their own eyes, including in this example – but I must not let my incredulity get the better of me.
Am I dreaming? That ReesMog thing is on Ch4 news bigging up coal! It was feckin Thatcher that flooded the Welsh coal mines so they could never be used again!
I’m going offline before I explode!
@fairie
Please follow the Rev’s rules on formatting: http://wingsoverscotland.com/about/
Had you done so, I might have read your post. As it is, I have no intention of doing so.
@Kininvie;
In total agreement with that. It’s sad to see the oil industry split up into pieces as it is. If the industry had been kept as whole, it would have undoubtedly secured even more jobs than there are now.
kininvie
In the meantime I would also be seeking to see their detailed product accounts (part of their internal management accounts). These records, probably in a database format, will show the detailed cost of every product they produce. The costs will be at a very detailed level.
These things are standard in such an organisation.
@ fariefromtheearth
Bit long for a haiku isn’t it?
Just heard Eric Joyce on Channel 4 attacking Unite’s negotiating skills along the lines of the http://wingsoverscotland.com/quoted-for-truth-32/.
Now whether one agrees with him or not why didn’t the BBC or STV quote him?
ALD – Eric Joyce is on Scotnight tonight from 10.30.
Juteman
Lots of misinformation going on about gas.
Heard Chris Huhne on Channel 4 say gas price is going up and that “cheap” US fracking gas will soon fall in line.
Then we have Ineos saying North Sea Gas is running out (used to be a popular band) but massive new gas field coming on stream next year and is being routed via St Fergus where Ineos currently gets its supplies.
http://archive.is/ZoTVn
And now BBC asking Torquill Crichton where the Grangemouth closure leaves Alex Salmond’s indy ref plans re oil! Surprised NOT I am!
To be fair, Torquill being very fair to AS in dealings working with WM on this.
How’s this gong to affect Dunfermline as it’s only Slab and SNP that are getting the airplay on this, for obvious reasons.
“Sometimes I think we are really going to do it, and get a Yes vote next year. I felt like that on the independence rally last month. Other times, like today, when some people in Scotland think it a good idea to gloat over major economic problems here, I think it is a lost cause”
You and me both Bro’. But I’ll tell you one thing, I sense a change.One of the most committed unionist’s I have ever met has turned. That’s not an isolated event. I like to think some of my input in pointing out the error of his ways had a contributing factor, but at the end of the day he’s now one of us. There’s mair like him,lots.
Could G H Graham care to provide some more specific data on plant inefficiency at Grangemouth? As I recall, the plant at the refinery is computer controlled. Have you in mind a software upgrade? Oil refining starts with pumping crude oil – from the North Sea into the lower end of a fractionating column, steam is also pumped in and vapourises the oil such that it rises up through the column and there are several points on the column where the oil can be drawn off at various viscosities – bunker oil, kerosene etc. A fairly simple process. Keen to hear on potential efficiencies from you.
There is a way to lower operating costs, I’ve witnessed it in the Middle East. Bring in 3rd world workers on pittance wages,take their passports from them, set them up in accomodation dormitories and hey, lower operating costs.
Then there is the bulk feed supply tactic neatly explained by Peter A Bell above. Jack up the bulk supply costs, and so profits, and hit the downstream plant with operating losses.
There are loads of unscrupulous ways to demonstrate unprofitability.
And finally, if a patsy of a Trade union comes along, well, its like taking candy from a baby.
Craig m says
“Message from SG should be “Westminster should take responsibility or, in the interests of Scotland we declare UDI!”
Not going to happen,
Rhodesia declared udi in 1965 but no doubt had the support of its army and police forces If we tried that it would end in a short but bloody civil war ,
independence WILL ONLY come through the ballot box
MM has not mentioned Labours part in this dispute, but you can guarantee Labour will mention lack of North Sea Oil as reason, its the SNP that will carry can and be criticized. its telling that Cameron has not stepped in….its in there interests it shuts
next week or two could change next years result one way or other,depending on how Scottish Government handles
This just shows the folly of privatising essential industries allowing them to get so big as to dictate/threaten countries with impunity.
Only slightly O/T but Jim Sillars on sound form in Evening News to-night as to why we should vote YES and paying tribute to Alex Salmond’s speech at Conference.
http://archive.is/qYFeR
Fuck this for a game of soldiers…..Osborne goes to china signs some huge deals and all of a sudden Grangemouth to close…..part of osbornes deal?
More than happy to donate to help buy out Ineos and save Grangemouth for Scotland. Is this possible Stu? Come on Scotland put your money where your mouths are!
SAVE GRANGEMOUTH….SAVE SCOTLAND…..SAVE FACE!
This has always looked like a setup, with Unite as a merely a warmup act.
The plant may or may not currently be profitable – it’s unlikely we’ll know for sure but is in any case irrelevant. Grangemouth must be saved – not just because 800 jobs are at stake, not just because we cannot allow our economy to be dented, not just because this is about Scotland’s energy security, but because we do not wish to remain part of this disgraceful capitalist model which says it’s ok for big businesses to behave in this way.
Right, UDI it may have to be.
MajorBloodnok
Very droll. #:0)
I agree.
Another London Dividend says:
I agree Jim Sillars nails it for me. Required reading.
There’s the small matter of a significant majority of Scots, according to polls, *not* wanting independence?
Polls taken before the last two elections showed an SNP defeat; polls taken before the 1979 referendum showed a No Vote victory. The point is that this is the first time the people of Scotland have actually been asked in a true referendum, rather than relying on weighted polls. Until the referendum comes and goes, we won’t know with any certainty how much of the electorate truly backs independence or not, and history has shown that polls are hardly reliable when it comes to such outcomes.
Besides, the SNP have dragged their own heels on this long enough, have they not? The referendum could’ve been done a year ago easily, let alone late 2014!
It could have, but that would’ve been monumentally stupid. The Yes campaign has had to combat literally centuries of unionist propaganda, the cringe, and constant belittling of the very idea of self-determination. By the exact same token, every other government could have had a referendum at any point in the past century – after all, most polls showed “support” for the union, so why did they “drag their heels”?
The fact that the SNP wanted a referendum at all should show there’s a world of difference: the fact that they chose to take their time rather than rush things through without adequate time to normalise the concept of independence and present a solid, well-thought out case shows that they are competent. More than can be said for more than a few governments.
“SCOTTISH LOTTERY” for good causes across Scotland (including saving industry and jobs)?
YES is the only answer…lamont/liebour hang your heads in same!
@MajorBloodnok-
‘Bit long for a haiku isn’t it?‘
It’s actually a ‘jumboku’ – must contain exactly eight-hundred and ninety-five syllables and at least one pastoral scene.
O/T
The Common Weal may very well get close to their target I see. 🙂
Whatever the outcome at Grangemouth, Scotland will always be on the back foot until we achieve full independence.
Many of the unionists are rubbing their hands in glee at the though that this might damage the YES campaign, proud Scots indeed.
A pox on all of them.
Dear God, this UDI thing is coming up again….
If you want Scotland to have any place in the world other than as a pariah state, recognised only by Iran and Venezuela, then you simply have to stick to international norms. And those norms are, for better or worse, that you don’t get to be a player or a trader, or indeed anything, unless your presence at the table is welcomed and agreed by the vast majority of nation states.
It’s like a wedding where some univited drunk turns up. It’s just not on. Forget it.
If you want convincing, look at Palestine, where half the world is fundamentally in sympathy, yet they are recognised by how many countries? Or South Ossetia, even with the support of Russia?… I could go on, but I won’t.
We have a priceless opportunity to win independence through democratic means, and an assured welcome into the world thereafter. The UDI alternative is, frankly, folly.
@HandandShrimp
Almost there – a couple of quid more from each of us and they’ll be home and dry – c’mon the Common Weal!
http://www.indiegogo.com/projects/the-common-weal-we-need-you-to-build-a-better-scotland
It matters!
I hate to say this but democracy, UK state style, is failing Scotland. Actually it’s failing the UK, but Scotland comes first. UDI has to be seriously considered. 10% of Scotland’s economic strength is being threatened. At some point someone in this world has to stand up to to the Neo Liberal bully boys. The Westminster model of economics is broken. It simply doesn’t work.
Unfettered capitalism just doesn’t work. You have to have state intervention. When you have a nation with a devolved government, voted by the population of that nation, being effectively shafted by the political system of the parent government, then, for the sake of proper democracy, and social cohesion, you have to move beyond the constraints of that system. UDI for Grangemouth and Scotland.
@ Captain Caveman :
Grangemouth failure very likely – Are we still better together ?
In fairness, I have not attempted to make a political point over this – my ire has been, and is, exclusively directed towards Unite (crikey, that’s a misnomer if ever there was).
So responsibility for this apparent major economic failure and your comments responding to the likely outcomes are not political ? Come on thats stretching it.
The UK political economic system holds sway at the moment and has failed in this instance (reserved matter and all that) UK supporters can’t have it both ways.
You can’t revel in this and disassociate with responsilility – that just juvenile.
UK has failed here, it would be nice to get some honesty for once from a regional /unionist supporter.
What the hell gas g h graham been smoking , a loss making refinery is closed down , any questions . My god man where’s your common decency for your fellow man 800 families are distraught tonight .
Why don’t we have a national petition to nationalise the whole of the Grangemouth operation. Then hand it over to the Scottish government and turn it into a company like stat oil in Norway.
@ X_Sticks says
Just as long as no idiot tries to suggest this figure has been achieved because Labour fringe are now sniffing around the edges and suggesting they may get involved – the last thing it needs.
totally disgusted today by the gloating of some of my pro-union workmates. They believe this is now the end of independence. totally sickened by them.
I would tend to agree that that an oil producing country should have a refinery and that it would be better in public hands. If it is such a liability then Ineos should hand the keys over to Holyrood and walk away from the facility and the pensions etc and save themselves £10m a month and future pension costs. Why would they not?
What gordoz, you mean we might have to……fix bayonets? It may get red, but it won’t be labour.
Rev, perhaps we should consider the actual employee terms, conditions, wages and pension rights at the Norwegian petrochemical facility – because Ineos investment for the future was made in that facility – dispite the cost base. To say that the cost base in Scotland is higher or that productivity is lower dose not – on the face of it – stand up to scrutiny.
Johann Lamont on Scotland Tonight.
Why?
Will it be to explain Labour’s role in helping to provide this avenue of escape for INEOS is or will she confirm she continues to have no audible opinion and she and Scottish Labour have absolutely no influence in this affair.
Meanwhile, on a dismal day, cheer yourselves up watching Margaret Curran here
@ X_Sticks says
Christ no ! (Dunfermline Leaflets / Lamont & Co.); geez a break.
Common Weal steer clear of Labour backsliders !
Maybe Lamont’s on STV tonight to apologize to plant staff for Labour member/official involvement that led to a fiasco and advice to the union to hardball their way into a situation where they will now losw their jobs.
That would be refreshing to hear – any takers of the odds ?
UDI is not the answer, because first and foremost you have to be sure you are declaring it on behalf of the majority of the people of the country. I still firmly believe that next year Scotland will make that decision, but I also believe that at the moment there is still a measure of folk to be convinced and if we are to give the least impression of wanting a democratic country afterwards, then we do things in a democratic fashion now!
In one sense it doesn’t matter if the dark forces are not acting in that way, because they never did, but whether we like it or not the majority of folk in Scotland were content to let them remain in control, it has taken years to reach this point and and to get our countrymen and women on our side, to try anything like UDI would only serve to lose us support where we need it most, here in Scotland.
This story has, I believe, a lot more to come and if we are to obtain anything positive from it, then we must not allow ourselves to rush into decisions that might just be what the opposition would like, we need to keep positive in what we believe is right, namely a YES vote, we have to demonstrate by what we do and say, that we will not be deflected from our course, we have to show to the people of Scotland, as do the Scottish government, how we would react if this or something like it, were to happen in an independent Scotland and we couldn’t declare UDI then, It has to be shown that the people of this country are capable and do not panic at the first real trial that comes along and that we handle things in a responsible manner.
I was speaking to another Nat’ tonight, who like myself carries many bruises from past campaigns and we agreed that whilst the name-calling, the lies, the bluff and the bluster were all to be expected, even before the campaign began, that something else was bound to come, (or should that be brought), along, because this time the stakes are so high and unionists will if anything, see that even more clearly than us.
It’s time for clear heads and increased determination, there is still a long way to go, let’s not end up claiming defeat from victory by our own actions!
Just read this
http://www.opendemocracy.net/ourkingdom/robin-mcalpine/whats-really-happening-at-grangemouth-and-what-it-tells-us
ayemachrihanish –
Ineos proposed to do exactly the same thing at Grangemouth as they have done in Norway, build a gas storage facility so that imports of cheaper gas can be brought in and stored.
John Grant says:
What the hell gas g h graham been smoking , a loss making refinery is closed down , any questions . My god man where’s your common decency for your fellow man 800 families are distraught tonight .
Another, equally accurate, way of putting it John would be to say 800 people gambled their jobs on the say so of Unite and lost. How many of those workforce know that Ineos just completely shutdown their operation in Hull two weeks ago ?
This is why a change is gonna come!
Here’s a question for everyone.
How many buyers of petro-chemical plants out there will want to come in and buy Grangemouth knowing that they will have to deal with Unite/Pat Rafferty/Stephen Deans and the local Labour Party ?
Less than £200 now needed to take the Commonweal fund to it’s target, if anyone fancies trying to be the one that brings it over the line 🙂
http://www.indiegogo.com/projects/the-common-weal-we-need-you-to-build-a-better-scotland
Xsticks
Blimey the Common Weal really are almost there. Looking good to hit the target tonight with only about £150 to go.
For the hard of thinking; overcapacity means having a capability of making more product/service than your customers need. Oversupply means more product/service already made in excess of what is actually needed.
Large process plants have a finite capacity but when they run at reduced volumes, there is a volume point under which they cannot cover their overheads. The position is made worse when wholesale prices fall which effectively elevates the volume point below which the plant will lose money.
To make large process plants more efficient, they invariably need to increase production volume (needs cash injection) to spread the overhead, reduce unit energy costs (utilise more modern technology) & minimise waste/rework (improvements in technology & changes to working practises can help here).
But there’s no point in investing in a refinery to make more product when no one wants to buy it. Demand for hydrocarbons is falling. This causes wholesale prices to fall. And if the employees are unwilling to negotiate changes in working practices to assist with improving efficiency, the owners appear to have had no alternative.
All the other conversations about conspiracies, political intrigue & stitch ups belong in the fiction section at the local library. You might be horrified with the consequences but Grangemouth is a victim of a combination of underinvestment, falling demand, falling wholesale prices & an inflexible workforce.
If you feel so strongly that you must respond, then might I suggest driving your car around the block a few times today to elevate hydrocarbon demand next time you prematurely visit the petrol pump. Buying that electric car & cycling to work may not have been the smartest decisions ever made if your priority is to have an oil/chemical refinery on your doorstep.
Are those slow to pick up on the basics of running a large process plant up to speed now?
On the issue of scaremongering linking Grangemouth to North Sea Oil and Independence Prof Alex Kemp stated on Scotland Tonight (last night ) that North Sea Oil has a very good long term future and it was all about falling gas supplies and cheaper franked gas produced from USA. He stated this after John McKay asked him.
The good prof put the record straight. It is just me or STV becoming as biased as the BBC?
G H Graham
Are you seriously saying that BOTH the petro chemical AND oil refining at Grangemouth should be allowed to close?
@ Papadocx
‘Why don’t we have a national petition to nationalise the whole of the Grangemouth operation.’
Already started:
http://tinyurl.com/ox8bqkb
UDI would be very messy and very risky, and would not be a rational response to what is happening at Grangemouth. However, I do think there is a possibility that some time in the future UDI will become the least bad option, if there is a narrow No vote followed by harsh measures from Westminster. I also think that if the UK chooses to leave the EU, and gives formal notice of its exit, then the EU might just be sympathetic towards Scotland declaring UDI in order to remain part of the EU.
I just hope that the vote next year is Yes, so that there is no need to resort to such desperate measures.
If Grangemouth is indeed unprofitable and worthless as Ineos apparently says, then neither the Scottish Government (which can’t nationalise it) nor the UK Government (which can) should do so.
The UK Govt should offer to take it off Ineos’ hands if Ineos pays the UK Govt an amount equivalent to:
A. The redundancy liability costs of the workforce.
B. The entire cost of decommissioning the plant, detoxing the environment and returning the site to a greenfield site.
Less the value of any raw materials and finished product on site and, say a 5% discount on items A & B above, as the Govt would keep it as a going concern.
Oh, and HMRC should immediately begin a forensic (to the level of having them bend over and parting their bum cheeks with (unwarmed) teaspoons) investigation of the tax affairs both of Ineos and its billionaire boss.
Whilst have sympathy for the workers at Grangemouth, I have to say and this is just my personal view, that if I had the choice of taking a wage freeze for a couple of years, a couple of days less holidays or a reduction in hours to save my job and thousands of others I would have voted with my conscience.
For the last 2-3 years we have had to take annual holidays before a certain time as there were not enough hours work to keep all the employees fully engaged. If this wasn’t agreed to there would have been redundancies, and this has been happening country wide.
I got the feeling the the Unions actually thought that the owner of Ineos was bluffing, but looks who’s bluff has been called?
However, no matter the rights and wrongs, I really hope that both sides, the SG and the arbitrators can get around the table and start banging heads together to come to a compromise of some sort and get Grangemouth back up and running before it is too late.
“How many buyers of petro-chemical plants out there will want to come in and buy Grangemouth knowing that they will have to deal with Unite/Pat Rafferty/Stephen Deans and the local Labour Party ?”
I really hope that somewhere within that dark void that once passed for a soul, some people in “Scottish Labour” are doing a bit of searching right now.
The leadership of Unite and Labour (presumably the same people) seem to have played high stakes politics with people’s lives and lost. They lost because they were so busy in-fighting and playing political games they failed to see the big picture, or to understand what was going on. Grangemouth is “Scottish” Labour in action, or non-action. We see their games, lies, smears and general uselessnes week in, week out in Holyrood but this is orders of magnitude worse.
So here is my hope. That this will be a wake-up call. That they’ll start to grasp the realities of Scotland today and what’s happening. And they’ll try to become part of the solution, not part of the problem as they are now. I’m not holding my breath. I expect tonight Lamont will be her usual bitter self and spout vitriol at the Scottish government and Salmond. If so, I really, really hope those better people in Labour or within the union movement can take it in hand and do something, say enough is enough.
The workers in Grangemouth, and Scotland more generally, have been f***ed over by Ineos but their Labour and union leaders were the ones who let them do it. Now the only hope lies with either Westminster or the Scottish government. Good luck getting the Tories to come on side with the workers. So in reality it’s probably the SG. They won’t be able to do much effective if it’s in the face of sniping and emnity.
@ukp50;
Good read, especially, (referring to the UK in general);
“We are one of the few countries in the world where key infrastructure is mainly owned overseas.”
@G H Graham;
“Demand for hydrocarbons is falling”
I don’t think so. For petrol yes, in favour of diesel. Grangemouth’s current production – 25% petrol, 25% diesel, 50% other.
Awkward though, the only over production visible is encapsulated in the number of refineries in the UK. The main competitor for petrochemicals is in fact the even larger Asian and middle eastern complexes – making Grangemouth one of the more competitive European refineries.
I’m afraid “For the hard of thinking” should be supplanted by “For the sake of market forces driven by UK population dispersion and end provider transportation costs”. Essentially, it’s cheaper to haul petrol around England from English refineries. (Since the UK is expected to shed 4 more refineries imminently).
It’s so frustrating as well because in essence, there is not a huge difference in policy between the SNP and Labour, or indeed the Lib Dems. If all 3 would work together to get what’s best for Scotland, they could achieve anything they wanted at all. A cross-party (minus the conservatives) consensus in Holyrood for what should be done at Grangemouth surely can’t be unimaginable?
@Ann;
Did you deliberately omit the whammy of no more end salary pensions?
Common Weal have now made their target and raised £25 000.
Wow, the Common Weal made it! Who’d have thought that a week or so ago?
Well done all. I’m sure Robin will have plenty to say about Ineos. In fact he was on the wirless earier today, doing just that.
“Common Weal have now made their target and raised £25 000.
That’s such a good piece of news to here after everything else today. Sort of the opposite of the rest of the day 🙂
So, who’s up for crowdsourcing buying an oil refinery?
O/T Just watched the Dunfermline Hustings debate on NNS.
British Labour’s Cara Hilton is a very, very poor candidate, but sad to say she will get voted in by the locals in true by election tradition.
In a difficult situation voters revert to default position.
Believe SNP will find it very, very hard to win this seat at this time.
Its a pity because I think they genuinely have the better candidate this time, (by a mile).
I am going to keep repeating this until I am blue in the face.
Shop stewards are there to represent the interests of their members NOT the interests of the Labour Party.
It’s the Labour Party’s shenanigans in Falkirk that has contributed to this mess and once people get that through their skulls then maybe people will tell their shop stewards to back off from their involvement in the Labour Party and concentrate upon the interests of their members.
It’s the fucking Labour Party that is destroying Scotland, its time the shop stewards and the Unions start focussing upon what’s good for Scotland rather than what’s good for the Labour Party.
Great news re the Common Weal reaching its target and introduced a bit of hope on this ghastly day. It’s really true that every little helps:-)
Lets swap the BBC for the refinery.
@ Castle Rock
Totally agree.
Said as much myself at 2.57pm today
Its sad when people get so easily led up the garden path (the unions need a real rethink in Scotland) – the workers got shafte true; but they also got very, very bad advice from their officials – who took advice from Scottish Labour.
Suppose Labour are gonna charge in and save the day ? – sure
Brinksmanship at its worst / only in Scotland
I am one of those ‘EXTREME’ people who think that this is most certainly a conspiracy to undermine Scottish industry, the Scottish parliament, and the Scottish government, especially the SNP.
I say this on the back of having been reading ‘The Flag In The Wind, by John MacCormick which is essentially about the beginnings of the reality of an Independent Scotland being an actual choice for the people of Scotland. Read chapter 12, the correlation between what is happening now regards the media, and westminsters attempts at demeaning Scottish industry and the Scottish poeple, couldn’t be closer, that was back in the 1920’s and early 1930’s.
The closing of Grangemouth is just not going to have any truck when it comes to the referendum and may backfire for the anti Indepedence lot. Hope so!
@ Cynical Highlander
Good call – Im with you !
Well Done to the Jimmy Reid foundation re Common Weal project success
“Shop stewards are there to represent the interests of their members NOT the interests of the Labour Party.
Aye, but in theory MPs are also supposed to represent the interests of their constituents (all of them) in Westminster. In reality – and it was very starkly illustrated in Falkirk – it’s now all about who gets to be Westminster’s represenative to the plebs. And that is decided by a tiny group of in people.
Trouble is, to even begin to address this, you have to wake people up and get them standing themselves, joining parties, forming new parties and mostly not just trooping out to vote for the party who knows they’ll win.
@cath
we could make an opening bid at say…i dunno a quid mibbie?:D
To Murray McCallum,
If a refining process doesn’t make any money it has no ‘right’ to remain open. However, I’ve run many operations at a loss as part of a portfolio of business units which overall made money but the reasons for doing so were invariably to limit local competition or maintain cross regional customer accounts.
But I’ve also shut units down which did not generate a profit & were of no negative strategic consequence. Regrettably, job losses were inevitable but the circumstances which allowed the business to originally operate at a profit had changed. Sometimes they are out of your control; politics/market preferences/technology/competition etc. I know of no one who enjoys closing businesses but sometimes it is unavoidable.
The recession initiated by the banking collapse has caused demand for fuels, chemicals & raw materials to fall all over Europe. Overcapacity in any business in Europe is at risk of closure until demand starts to rise. Some businesses use these quiet periods to reorganise, reinvest or change strategy. But each business is different of course.
Grangemouth is a relatively inefficient refining business in a market suffering from overcapacity, low wholesale prices & falling demand from customers. Only the largest refineries using the latest technology that also enjoy low energy costs, lower labour costs & the minimum of cross border trade tariffs are likely to survive.
Hey Stu : You gave them plenty of time and absolutely nothing
See the MSM totally ignored the J Morton & lottery rule breach scandal at British Together.
Did anyone else hear anything ?
O/T
Speaking to folk from Dunfermline, they are just hoping for Friday and finding out what happened.
But the interesting thing is that the Tories and LibDems have also been out adding to the wastepaper. So it looks as if there’s not another Glenrothes in prospect where the Unionists all turned up together to keep the SNP out. The other two must be reckoning on a SLab win so they are quite at liberty to resume their fight for third and fourth place. So Dunfermline really is a head to head.
IIRC in 2011 the SNP snuck through from third place to win. Amazing that after 6 and a half years of SNP government it is a head to head with SLab. How do they do it?
X-Sticks, Common Weal has made the £25,000 :o)
I have just donated.
BBC announce Unite now agree with the Ineos plans.
Radio 4 news reporting union will accept offered pay package
@Cath
“…you have to wake people up…”
If this doesn’t wake people up then I don’t know what will.
I suspect I know what’s going to happen next, the Labour Party are going to come out and say we need a Labour Government to protect the workers just like they did when they closed Ravenscraig.
We are going to get a lot of hand wringing and weeping of crocodile tears by Labour Party MP’s and MSP’s who will be secretly glad that they might be able to use this to keep Scotland down.
The punters in Dunfermline will elect another bitter and useless Labour Party politician who will do fuck all but line her own pocket while actively supporting the closure of yet another school.
I agree, we do have to wake people up, wake them up to the fact that it’s the Labour Party who are doing Scotland over. Only then will we be free of this kind of shite.
@G H Graham
Sir, you strike me as a particularly despicable type of person. To maintain loss making businesses simply in order to destroy local competition while happily closing others where no such competition existed… You disgust me!
One thing; you will never lack for a donor should you require a heart transplant the surgeon can simply nip down to the local pound shop for the required new wallet.
G H Graham
As far as I am aware, even Ineos have not said that the oil refining business at Grangemouth is loss making.
The “end game” of what you are suggesting is maybe one refinery per continent. Your basic supply and demand, perfect market, no barriers to trade model takes zero account of risk (or even fuel duties for that matter).
The cost of buying fuels in the some parts of Scotland is already very expensive. If Scotland were to import 100% of her fuels I guess we would go cap in hand to Westminster (or maybe ultimately Germany, or Russia) and ask for a subsidy?
If this means the Scottish Government has to take a strategic stake in the oil refining activity at Grangemouth (or maybe even commission a new site) then I am for it.
Gordoz
I wouldn’t call the J Morton thing a scandal. It is in the scheme of things small beer. What is a scandal is that the press harped on about a writer who was legally paid a token amount for his writing time to provide an article for the Yes Scotland but are not interested in pretty much anything Better Together do. It isn’t surprising that the press are not interested in Morton’s lottery books because they would most likely ignore any Better Together funding even if it was provided via the Afghanistan poppy trade.
So, in case I have had an elderly moment, and forgot to take my brain pills, could someone clear something up for me? We have the lowest life expectancy in the developed world, because our diet, but we can’t run a sausage factory at a profit. We have a major alcohol problem, and also export a heckuva lot round the world, but can’t run Whisky distilleries at a profit. We are Europe’s largest oil producer, and have some of the most expensive fuel in Europe, and it mainly comes into the mainland through ONE refinery, and we manage to make it LOSE £49000 a day. We are being asked to stump up several billion for an HS2 rail link which comes nowhere near Scotland, and will operate to its detriment, we manage to fork out BILLIONS for the banks, and even nationalised the Northern Rock. Not one of our wonderful Westminster Government has suggested the government buying over at least part of the plant for a lot less than they have shelled out before… I was obviously off school the day they gave out a believable explanation for all of these things…
Boorach & Linda’s back
Nothing on any news sites re: UNITE accepting any more info?
@ c m d
reported on radio 4 news… INEOS spokesman wouldn’t confirm offer would be accepted
It does stink. BASF closing too ?
I reckon the tories have asked their rich pals to do what they can to upset Scotland before the referendum.
Just saying …
Looks like the SG and UNITE have had a chat.
http://www.bbc.co.uk/news/uk-scotland-24647843
Watch BBC GAVIN ESLER –
HE SAID TO INEOS REP “SCOTLAND IS NOT COMPETITIVE” BUT WAS CORRECTED
HIS ATTEMPTS TO UNDERMINE SCOTLAND ARE DULY NOTED!
PASS ON TO WATCH THIS GUY!
Excellent news about the Common Weal.
It’s amazing the way people can come together when they believe in something.
Mony a mikle maks a muckle my old Gran used to say.
That’s why I have faith we will win our independence.
Just watching Scotland Tonight – have no feckin idea – whatsoever – what JoLa is talking about. My brain must shutdown with her appearance
@Boorach-
I haven’t read all of your comments across all WoS threads, but I’ve never heard you so angry, and that, to me anyway, is proof that this whole episode stinks to high-heaven.
Fuck any party-political allegiances – this is basic stuff. For anyone who’s forty or over, this is deja-vu territory, so we’ve even less excuse than the young ‘uns.
It’s up to us to make sure we don’t get the same outcome – the lines are now so clear that we needn’t debate them at length.
We need to act.
This is the end of the union movement in Scotland. Make no mistake – the floor staff trusted Unite, even when the union threatened to close the plant simply to protect it’s own man! And now they can count the cost on the way to dole line….
Watch union membership collapse – UNITE is finished.
The unite guys just don’t get it.Insulting the one guy,whatever you may think of him,who can keep the place open,on tv, is so thick.
Yeah – there was once 650 people at BASF – 2005 I think – now all gone.. Berlin wall coming down was the worst thing to ever happen to the working man in the West.
With the threat of communism removed and access to new labour forces opened up the shafting of the working class could begin in earnest.
They’ve turned the world into one huge sweat shop and prison and you ain’t getting parole…
Hey, Peter Mirtitsch (10.21) you are bang-on mister, and I love you. Why is your surname so difficult to spell (even more-so than ‘difficult?)
And hey, you, ‘Daughter of the Evil Reindeer’?
Aye, you.
Thanks for that wee Sam Cooke blast.
Nice wee reminder – this whole crazy game we’re part of involves stuff that the BT/No Scotland mob haven’t the faintest idea about, and can never try to claim.
We’ve got ‘Soul’.
They don’t.
@ Leandra
Ineos BASF
http://uk.reuters.com/article/2013/08/28/basf-styrolution-idUKL6N0GS3BY20130828
Some basic arithmetic is in order here. If the plant is losing £10 million a month that cannot possibly be significantly effected by any pay and conditions agreed by the workforce.
There is 1,500 on the payroll right? Do the simple arithmetic, £120 M per year divided by 1500 is £80,000 pounds.
In other words, even if the workforce average salary was £80k per year (which I’m guessing is about actuality X 3) AND they agreed to work henceforth for nothing, nada, zippo (which they won’t of course) that would barely bring the plant to break even.
So if the company claim of £10 m loss per month is true then all this talk about tweaking pay and conditions is only bluster, a smokescreen for failings on either the management part (failure to identify a success strategy for the plant and/or failed purchasing and pricing strategies) or on the part of the UK government (failure to support financially through taxation or investment any sensible strategic development plans put forward by the company).
It is, as usual, convenient for both the real players to blame the workers.
I am sure the Norwegian workforce will not work for nothing and I doubt if their pay and conditions will be less than those who work in Grangemouth. Perhaps it will succeed, perhaps there will be a successful strategy there. But the Norwegian Government would, I suspect, be well advised to take note of who they are dealing with and what is happening here.
@ Ian Brotherhood
Yup, they are spiritually dead!
As far as I can discover Ratcliffe and his pals bought their share of Ineos using junk bonds, that is they front loaded the purchase with the debt of the purchase. As near as I can understand it the business technically buys itself – it is the same problem Man United’s take over by Glazier suffers from.
Ratcliffe and his pals then gouge as much value as they can out of the company while leaving the debt burden behind to make the company look as if it is making a loss for tax purposes then once everything that can be written off or gouged out is used up then the usual modus operandi is to invest a small part back into the business to make it saleable and write off the remaining debt from the original purchase against capital gains liabilities of the sale.
In other words Ratcliffe and his pals sees the taxman off, coming and going. To a large extent how the business actually performs over this period is not that important as the big profit comes from the massive tax breaks claimed.
Ratcliffe and his pals have been caught with their hands in the till, one way or the other and are wanting out in a rush – hence voluntary liquidation. My supposition is that Ratcliffe has got the nod from someone like Iain Taylor of Vitoil that cheap ethane from fracked gas in the Scottish Central Belt is not happening anytime soon, if ever. This cheap local ethane was key to Ratcliffe’s sell on strategy for Grangemouth and without this ethane any investment in an ethane plant at Grangemouth would not make any return.
Having already written off the taxable value of the plant and land Ratcliffe and Ineos would be looking at a large tax bill in the next fiscal year without this new investment in ethane production.
This is not about jobs, it is not about the viability or otherwise of Grangemouth nor is it about the strategic importance of Grangemouth it is simply about profit for Ratcliffe and his pals and how they can bale out with the minimum loss to themselves.
MJM, it’s immoral what these so called big companies get away with, if I owe the taxman a hundered quid the send the hounds of hades looking for me with the full authority of the law behind them. But if you have a few bucks behind you and an army of scumbag lawyers, anything is cool, even murder can be excused if you have the right connections. Fuck I tell you what, im sick of living in a world like this. Where university graduates will roll you over and ruin people just for an extra few pounds. The law is an ass when it condones this. And let’s not beat around the bush, it actively encourages this type of thing. truley sickens me so it does.
Reading between Boorachs lines it obvious the only thing he has run is a hot bath.
Otherwise clueless when it comes to running a large multinational business. Never mind, school opens at 9:00am for those who need to get an education.
LSBF UNI totally corrupt and exposed in STV UNDERCOVER.
Warn students – has a royal patron.
@Molly
Maybe you’re right there. I admit I don’t know much about how Unite operates and exactly what they did to cause things to go haywire like they did. But I still think the entire situation was rigged to blow up in their faces no matter what action was taken.
Richie Venton’s blog post linked somewhere above fills in a lot of the blanks.
What’s happened is what’s happened though.
Pointing fingers and playing the blame game is utterly pointless right now.
Like I said before, the damage has been done. Might be better to concentrate on finding ways to fix it before it starts seriously hurting the Yes campaign.
Anyone know the facts about whether or not the loss of Grangemouth could wreck the economy of an independent Scotland? That’s likely the line that’ll be trotted out in the MSM…
It does not all stack up, something is very fishy.
The sums don’t stack up in many ways there appears to be a bigger picture that we are not all getting here. When things cannot rationally be explained I ask two simple questions:
Who gains from this?, who looses from this?
These two questions lead many of us to be very suspicious, as a ‘good corporate citizen’ 🙂 Ineos needs to shed some light and the first way to do this is to open their books transparently (no loss of commercially sensitive information if they are mothballing the site). Of course this is unlikely to happen and we revert back to the two simple questions.
Britain truly is a fucked up little place and the sooner we are shot of the short-term profit mentality and adopt a long term people driven economy the better.
BTW Boorach you are utterly out of order in your comments to GH Graham. He/she is giving you an insight into the economics of large production facilities and the ‘commercial reality’ of the system we operate in at the moment, you have shot the messenger. You may not enjoy the tone of his post but it actually adds to our understanding of what may be driving decisions that we do not understand.
INEOS are Keeching their breeks as they know long term if Scotland votes yes next year they wont be able to trample over their staff like they can do just now. unions don’t have any teeth under UK rule.
Thatcher extracted all those teeth decades ago
@ G H Graham
Regardless of what I’m capable of running it would appear that you are incapable of reading between the lines. A prerequisite, I’d have thought, for running a large multinational or did you have minions do that sort of thing for you?
Had you read between the lines you would have realised I was talking about common humanity, nothing more, nothing less. Whenever you corporate types drive a smaller business to the wall or close down whatever is not profitable enough for your shareholders you are destroying lives. Turning strivers into skivers with a stroke of a pen!
No doubt you will claim to be a ‘risk taker’, however, the only thing your type risks is your shareholders’ investmentn never your own money.
You are quite correct I couldn’t (and wouldn’t wish to) run any sort of multinational. But for all of your self-vaunted success I wonder which of us is happier in our own skin? I do know that there is unlikely to be anything in your life that I would envy you for.
@kininvie: We have a priceless opportunity to win independence through democratic means, and an assured welcome into the world thereafter. The UDI alternative is, frankly, folly.
As I said, the choice for a referendum is a good thing and shows us why our country’s in better hands than in the UK government’s. Of COURSE it’s a good thing: what better way to shut the naysayers up than to say the people voted for this measure, not to mention prove once and for all that the people are deciding their future, not their governments?
@Scaraben: UDI would be very messy and very risky, and would not be a rational response to what is happening at Grangemouth.
If Grangemouth was happening in isolation, I’d agree, but as we all know, this is hardly the only assault being made on the people of Scotland and the UK itself by Westminster.
However, I do think there is a possibility that some time in the future UDI will become the least bad option, if there is a narrow No vote followed by harsh measures from Westminster. I also think that if the UK chooses to leave the EU, and gives formal notice of its exit, then the EU might just be sympathetic towards Scotland declaring UDI in order to remain part of the EU.
I just hope that the vote next year is Yes, so that there is no need to resort to such desperate measures.
This is my fear too: that things are just going to get worse and worse to the point where this priceless opportunity to become independent through democratic is squandered or pointless. It is pretty clear to me, for example, that the UK has a strong likelihood of voting out of the EU, and even if UKIP never gains any power, their influence on Conservatives and Labour have certainly presented this. The UK government is already toxic, but it’s getting to the point where it’s starting to become a real and present danger to its own people’s health and wellbeing. It’s already devastated the poor, unemployed, and disabled, it’s hunting the asylum seekers and the homeless, pretty soon it’s going to run out of people to punish. And then who’ll be left?
Palestine & South Ossetia had no other option but to UDI, because the alternative was to be wiped out, or subsumed into another country. Scotland isn’t there yet, but for God’s sake, how much more is it going to take for the people of Scotland to WAKE UP.
To paraphrase a film wot came out last year: “How desperate am I? You threaten my country with desolation, you copy right-wing policies you can’t hope to control, you talk about peace yet participate in illegal wars, and you demonise the most vulnerable ’cause it’s fun. You have made me very desperate. You might not be glad that you did.”
Morning all.
This explains a lot I did not know.
http://opendemocracy.net/ourkingdom/robin-mcalpine/whats-really-happening-at-grangemouth-and-what-it-tells-us
Though I’ll admit I haven’t read the massive postings on here.
As the Rev says, not enough line breaks.
@ G H Graham and Boorach
Calm doon lads. G H Graham is merely playing devil’s advocate and basically pointing out that big business is ‘amoral’ – in fact company directors have a legal duty to maximise profit and they don’t run businesses as a philanthropic venture.
The real culprits are the governments and regulators that allow them to get away with all this – particularly our own beloved Westminster mob. I understand that there are moves afoot in the EU to try to harmonised tax regimes without excessive loopholes across Europe (and beyond) but naturally there are a lot of vested interests to make sure that won’t happen.
don’t forget the unions Major ! (the bloody unions)
Absolutely spot on, Business has been de-regulated and allowed to roam the world free and to hide it’s profits in any old place.
Unfortunately when doing this, those Western Governments decided not to set up any world wide regulatory bodies with any power to ensure fair taxation would be paid.
Oooops ! they say, but we know it’s deliberate.
Hilarious that people blame the government and regulators (I’m looking at you, Major), and not the unions, oh no. Even when they call everyone out on strike in a plant teetering on the edge of the abyss and all of their member’s jobs with it – at the eve of a massive make-or-break investment decision – nothing to do with pay, conditions or whatever, but because of (their) one man? How very 1970s (not to mention calling the actual geezer with the requisite billions of pounds in his wallet something rotten on national TV to boot). Just about sums up the political mindset here?
Oh, love the comments about the “outrage” of the management no longer offering final salary pensions to new recruits as well…? Lulz. Psst, guys, but us here in the (non oil soaked) private sector have been without final salary pensions for, ooh, lets call it 20-odd years now, even for those few of us who actually had ’em *at all* in the first place? Unbelievable, and just about sums up the ludicrous expectations/demands of idiot-boy ‘Socialist Worker’ types against a globalised world economy backdrop.
My dear Captain Caveman – you need to calm doon too and read what I wrote and note that I was not blaming or excusing anyone, just trying to explain where I thought G H Graham was coming from.
What I said was that businesses are ‘amoral’ rather than ‘immoral’ – they make decisions (or should make decisions) based on what is the best way to generate profit for their shareholders. Unions have different priorities, that is to make decisions that protect (or decisions that should protect) their members, particulalry relating to working conditions.
That is not to say that in the real world this is always what happens. However, the point is that the framework in which both parties have to operate is defined by statute and that means the laws passed by the Government (or Governments). It is the function of Government to try to balance the interests of all parties for the benefit of the country as a whole, obviously based on where they think the fulcrum should be positioned, which depends on the ideology of whoever’s turn it is to make the rules.
Therefore, if we want things to be different, i.e. businesses to be more compassionate, socially responsibile and to pay all of their taxes, and unions to be more reasonable and tolerant of change, then the only way that can be done is through changes to the rules, which is solely in the power of Government.
Our frustation in Scotland of course is that the Scottish Government does not have these powers and can only tinker at the edges of the Grangemouth crisis. But with independence those powers revert closer to where they are needed, our government would be able to act (and react) appropriately and that is why I will be voting YES.
Captain Caveman , it is quite remiss that Westminster Govts have allowed and continue to allow ‘ big business ‘ to exploit poor legislation . Whether that be by being too unaccountable or tax avoidance
.However , I remember talking to the wife of an employee a few years ago, (not a million miles from Grangemouth,)whose company in the run up to Xmas , were advised they could keep their jobs but work less days or maintain their hours and all be paid off.The husbands logic was its Xmas, to work, but work less hours means it is easier to get a job if your in a job sort of thing.His union colleagues disagreed.The upshot was, the stronger voices carried and what seriously hacked him off, was financially they were getting paid more than he was so they were sitting in a more comfortable position to call a strike.
When you look at how Germany or Scandanavia have evolved for business and Unions,Britain seems stuck in a time warp and you have to say, it cannot change until ‘The City if London’ loses it’s almost state within a state position and the political system changes and at UK level there is no appetite for that.At this time there is only one way to do that- the impact of Independence on the whole of the UK.
That said it doesn’t help the situation In Grangemouth today.
@Captain Caveman
“Oh, love the comments about the “outrage” of the management no longer offering final salary pensions to new recruits as well…? Lulz. Psst, guys, but us here in the (non oil soaked) private sector have been without final salary pensions for, ooh, lets call it 20-odd years now, even for those few of us who actually had ‘em *at all* in the first place? Unbelievable, and just about sums up the ludicrous expectations/demands of idiot-boy ‘Socialist Worker’ types against a globalised world economy backdrop.”
That almost got me angry enough to respond to it. Not bad…
This whole “who’s to blame” topic is yesterday’s news anyway.
What’s done is done. It might be more constructive to focus on how to deal with it now.
I’m still thinking the SG should just go up to INEOS and go: “Ok, you say the plant is worthless? Fine, here’s a pound. Give us the keys and get lost!”
I wonder how the MSM would have been playing this whole affair had Stephen Deans been chairman of an SNP constituency party?
“@kininvie: We have a priceless opportunity to win independence through democratic means, and an assured welcome into the world thereafter. The UDI alternative is, frankly, folly.
It would be folly and a horrible last resort. However, if the referendum was not called off, but the Scottish government called UDI now to stop Scotland being asset stripped prior to the referendum, and made the referendum one about whether the people in Scotland wanted to reverse that and go back under Westminster rule, that would still be equally as democratic, wouldn’t it?
btw, all those bashing unions as being unrealistic and being happy they’ve been defeated will be equally sanguine about this, won’t they?
Indyfortheguy tweet: #Ineos has this morning “requested” all the sub-contracters that work at #Grangemouth to cut their prices. Or lose the work.
Cath – very briefly:
It’s the international consequences of declaring UDI that matter. No matter how we might subsequently vote in a referendum, the message that will be sent to the international community is that Scotland is a breakaway, secessionary state – and that will be enough to ensure we don’t get recognition….
Have a look at the Confederate states during the American civil war and their desperate attempts to get recognition from the UK, and how their failure to do so meant the Union blockade of southern ports was seen to be legal – leading, ultimately, to their defeat, because they could not trade.
I don’t understand why some people are calling for a UDI from the Yes side. When you do this you instantly piss off the international community in a major, major way. They simply do not want to get involved in domestic politics. I think the idea is a non starter. It would instantly isolate Scotland, and we would undermine our relations with other nations, which might have previously been privately sympathetic to independence.
Cath says:
btw, all those bashing unions as being unrealistic and being happy they’ve been defeated will be equally sanguine about this, won’t they?
Indyfortheguy tweet: #Ineos has this morning “requested” all the sub-contracters that work at #Grangemouth to cut their prices. Or lose the work.
Cath, I’ve been questioning the Union in my posts, they have legitimate questions to answer and I think they haven’t represented the workforce particularly well.
However, nowhere in my posts have I shown pleasure at the workforce having their salaries cut or indeed anyone who relies on Grangemouth for work.
I think your posts and articles are excellent, but I’m not so impressed with this.
@Cath
Sadly such like it or lump it rate cuts have been going on all over the place. Ive experienced it 3 times in last 3 years within Finance Sector I.T. Not looking for sympathy, it is what it is and this is the path I chose etc.
These so called Austerity measures give CEOs opportunity and excuses to slice costs from their workforce. Sadly for contractors like myself we just have to lump it and at Grangemouth it seems the same, for contractors and workers regardless of any hopes that a Union presence would make a difference.
O/T
http://www.dunfermlinepress.com/news/roundup/articles/2013/10/22/475780-fife-council-to-contest-bedroom-tax-appeals/
Presumably Boorach & his ilk that despise corporations will be sending their I-Phones, football boots, TV’s & bananas back whence they came since all of these are made in low wage, low regulatory economies?
The double standards & hypocrisy of the general population is always entertaining, especially in periods of perceived crisis.
Once the dust has settled, I predict the vast majority will return to their normal duties, shopping for cheap bargains made in 3rd world countries just in time for Xmas.
For those too bitter to be civil, I’m not advocating the status quo, merely pointing out that you aught to have a clear conscience before castigating folks who have amassed great wealth. Inadvertently, some of us have made it thus whether we like it or not.
But the rules governing how wealth is created, accumulated & disbursed is for government to determine, not the individual. Vote wisely my friends.
G H Graham
“his ilk that despise corporations will be sending their I-Phones, football boots, TV’s & bananas back whence they came since all of these are made in low wage, low regulatory economies?”
You appear to not put much attention towards Boorach’s posts. Your description (as far as I can see) is the opposite to his approach to life and what is important to him.
I support an independent Scotland because I believe society can be fairer (not perfect or a utopia). I don’t want more of the same. What is the point in that?
@Murray McCallum,
You appear to not put much attention towards Boorach’s posts. Your description (as far as I can see) is the opposite to his approach to life and what is important to him.
Parody account comment! wee smily thing 😉
@muttley79: I don’t understand why some people are calling for a UDI from the Yes side. When you do this you instantly piss off the international community in a major, major way. They simply do not want to get involved in domestic politics. I think the idea is a non starter. It would instantly isolate Scotland, and we would undermine our relations with other nations, which might have previously been privately sympathetic to independence.
Forgive me if I’m being obtuse (won’t be the first or the last) but I still don’t understand why the international community has such a problem with UDI as a concept, especially with the apparent scorched-earth, no-trade-no-relations-no-nothing shunning. I mean Jesus Christ, the IC are happy enough not to put sanctions on countries that engage in human rights abuse and worse, but a UDI is grounds for quarantine?
Really, I’m pretty sure I’m missing something extremely obvious, but I don’t understand exactly why it’s not only rejected, but really forcefully so. Please, explain it to me like you would to a bairn, I’m that confused.
Great news that Grangemouth is to remain open, after the abject humiliation of a 100% climbdown by Unite. (Ironically, if they hadn’t been such *dicks* about the whole thing in the first place, doubtless they could’ve negotiated something on behalf of their members. But since when have unions really been bothered about their members’, as opposed to their own interests?)
Perhaps the people of Scotland will think long and hard in future before unquestioningly letting a union like Unite play hard and fast with 10,000 of their precious manufacturing jobs, for the sake of *one* union official?
As for Unite, they seem to be confusing public and private sectors, just like they did with BA?
“doubtless they could’ve negotiated something on behalf of their members”
That seems deeply unlikely given Mr Ratcliffe’s history.
Still, the union posturing was pretty naive. Complaining that the original offer was “putting a gun to our heads”. Why yes, so it was. That’s a fair description. So what do you do about it? Give exactly the response that will result in the trigger being pulled?
Taranaich and Muttley
Kosovo declared UDI from Serbia. Kosovo quickly gained recognition from most of the Western democracies, including the UK which was one of the first to do so. The UN referred Serbia’s ensuing complaint to the International Court of Justice. The ICJ ruled that Kosovo had done nothing illegal under international law. More nation states recognised Kosovo and the total now stands at over a hundred of the World’s 198 (or so? haven’t checked recently).
However, although Kosovo is a member and participant of many European and international organisations like the IMF, it is still not a member of the UN because the acceptance threshold is much higher than 50% (around 70% IIRCC).
The nation states which have yet to recognise Kosovo are generally non or dubiously democratic or have some specific reason of their own not to.
The main justification which is used by those not wishing to recognise a new seceding state is something called ‘territorial integrity’. This is somewhat a vestige of the imperial era where a ‘people’ with a recognised regional demograph, cannot invoke self determination and hence ‘remove’ some of the territory of the original host state.
Clearly, ‘territorial integrity’ and the right of a people to ‘self determination’ (as enshrined in Article 1 of the UN Charter and in other international treaties) are incompatibilities in international law. Unfortunately ‘territorial integrity’ still has some legal status internationally despite its moral and democratic dubiety.
However the ICJ ruling represented significant turn of the ratchet in favour of s.d. over t.i., a movement which has progressed, albeit haltingly, since the end of WWII.
Canada and latterly, the UK have attempted a new(ish) wheez by imbuing their highest courts with the authority to define human rights on a national basis and by bringing in the idea that agreement from the rest of the host state would be required before any secession could go ahead. This, on the face of it, might not sound unreasonable, but it is really just a modern spin on the concept of territorial integrity.
In Canada’s case, Quebec never signed up to those new powers for the Supreme Court, although they have aceepted some of its rulings.
Scotland, technically, is worse placed because the Scotland Act included (even though 99.9 % of those voting in the ’97 referendum were unaware of it) the agreement that constitutional matters are reserved to Westminster.
However, in Scotland’s favour, the referendum came before the UK Supreme Court had established authority by precedence, despite an initial softening up barrage and before the UK has left the ECHR etc. Also the Edinburgh Agreement has ensured that this referendum will be recognised, but if a future referendum is required then it is more than possible that the UK Supreme Court will rule it or any subsequent UDI illegal.
Whether this new barrier between the international human rights of the people and international human rights per se will be accepted internationally has not been tested. The UN and ICJ have remained silent on the matter.
However, the Kosovo ICJ ruling would tend to suggest a future UDI by Quebec or Scotland in the face of opposition from the former host would still not be considered illegal despite the veneer of judicial propriety.
Any kind of national court cannot purport to be free of influence from that which is in the interest of the nation it serves and cannot therefore act in an appropriately judicial manner on such matters and human rights are universal in nature.