By Bob Duncan
First Minister Alex Salmond has promised he will be “personally involved” in plans to save the Hall’s of Broxburn meat processing factory in West Lothian, and with it 1700 jobs.
In a visit to the troubled plant on Friday, Mr Salmond said: “This plant is an important part of food production in Scotland and is an utmost priority for the Government.”.
The First Minister praised the reaction of workers who were informed on Thursday of plans to close the factory saying they knew more about running the plant than the management team who he said had to provide more information to allow for alternative proposals to be put forward that might save jobs.
Mr Salmond met shop stewards and managers at Hall’s, after the plant’s owners, Vion Food UK, launched a 90-day consultation. He said: “This is obviously a very difficult time for all those whose livelihoods are tied up in this plant, from packers to pig producers.
“This plant clearly has a troubled history, having been in jeopardy twice previously in the last five years. It’s clear that the pressures on profits margins in the Scottish/UK market, which have exacerbated an already difficult situation in the pig meat supply chain, are being mirrored elsewhere in Europe, with companies such as Vion reviewing and consolidating their operations beyond Scotland.
“This has been a decision taken at European level by the company, but I want to be clear, I will travel anywhere and meet anyone to try to protect Scottish jobs.”
But Mr Salmond added: “The workers know more how to run this plant than any member of the management team. They came up with a whole range of interesting suggestions.
“The main thing is they require key information from management so they can come up with alternate proposals during this 90-day consultation period.
“Shop stewards want to know what can be saved from this plant and what jobs can be protected.
“I will be personally involved in dealing with the task force at each stage, giving whatever help I can or they require. I would be delighted to do that as First Minister.”
Fiona Hyslop, local MSP for Broxburn in the Linlithgow Constituency, attended a Government-led Task Force meeting in Broxburn on Friday night to discuss the consultation on the closure of Vion Halls Broxburn Branch which employs over 1,000 permanent full-time workers.
Speaking on Saturday, Ms Hyslop commented: “I am pleased that the First Minister was able to come and speak to people at Vion following the Finance Secretary’s extended visit yesterday and welcome the speed in which efforts are being made to deal with this devastating situation.
“The Task Force meeting last night discussed how the Scottish Government plan to work with the company, the trade unions and all other relevant agencies to try and find a solution for the workers and their families.
“The priority is of course, to work to keep the plant open and provide support for those affected. Any outcome is to too early to predict, however from last night’s meeting it was clear that there is plenty of work going in and out of the plant and I think it is vital that we get to the bottom of why the site is finding it so hard to stay open.
“I will continue to do everything I can to assist the people of West Lothian and our economy on this difficult issue.”
John Swinney the Scottish Finance Secretary said that a general financial strain across the sector is a possible cause for concern at the plant. He said: “All the employees tell me they’re busy, some of them only in the last couple of days were being asked to work overtime. There’s plenty of work going in and out of the plant.
“The challenge is to ensure that we can deliver a productive and profitable approach that maintains continuous employment. That has to be my priority.”
In September, Vion said 250 jobs would be created with £1.5m support from Scottish Enterprise and up to £500,000 from Skills Development Scotland. Among the 250 jobs were to be as many as 100 modern apprenticeships. The investment, which has not yet been accessed, was said to safeguard 1000 other jobs.
Mr Swinney said: “The money is committed but it’s not been drawn down – it has to be part of discussions I have with the company and with other stakeholders about how we take forward the agenda for the plant.”
He said the jobs threat is puzzling, given the firm’s strong market position and “quality” products.
Scottish Secretary Michael Moore said the UK and Scottish governments would work together to explore all options for the future of the site. Mr Moore discussed the approach with the firm’s chairman, Peter Barr, the National Farmers’ Union and Holyrood Finance Secretary John Swinney on Friday.
He said: “The UK Government will provide whatever help we can to support the efforts to protect the future of Hall’s of Broxburn and the jobs of their workers.
“I have spoken with John Swinney and promised to provide the taskforce with whatever support they require from the UK Government. This situation requires a united team-Scotland approach and that is what will happen. JobCentre Plus are already playing their part in the taskforce.
“This is a very worrying time for the workers at the Broxburn factory and other parts of the Scottish food industry who do business with the company. They can be assured that Scotland’s two governments will work together to achieve the best possible outcome.”
Meanwhile, hundreds of Scottish pig farmers fear they could be forced out of business if the closure goes ahead. The famous plant slaughters 70 per cent of the pigs produced in Scotland and farmers have warned that its loss will be catastrophic for the meat processing industry.
Dutch owners Vion have another pork processing plant at Malton in Yorkshire. But farmers say taking pigs there would cost an extra £6 per animal, heaping more financial pressure on an already hard-pressed industry, which has been hit badly by rocketing prices for the grain the pigs feed on.
Philip Sleigh farms at Oldmeldrum, near Inverurie, Aberdeenshire, and sends his pigs to Broxburn. He said: “When the price of feed goes up it impacts greatly on the bottom line so that was already quite a concern, but this is another worry.
“At the moment the reaction in the industry is one of dismay. There had been rumours for a while and it was not unexpected that something was going to happen. Pig farmers who have made the commitment and invested heavily over the last two or three years will hopefully carry on, but the news has created real uncertainty.”
However, there is one small crumb of comfort for the pig industry, the core of which is based in Aberdeenshire, Moray and Kincardineshire. Slaughtering is expected to continue at least until December to cash-in on Christmas trade with closure of the factory likely to be early next year.
Jim McLaren, Chairman of Quality Meat Scotland, said the 90-day consulation period before the planned closure must be used to “thoroughly explore all the options”. He said: “Our pig sector has repeatedly shown its resilience and ability to adapt to a range of challenges in recent years and this flexibility is a great strength. Our producers are highly efficient and now very much focused on long-term sustainability.”
David Hall, the last member of the Hall family to have led the business and who was managing director until 1997, questioned whether its more recent owners had a “feel for the business”. He said: “It became a very big business and one which was difficult to manage.”
David’s father, David A Hall, started the Hall empire from a butcher’s in Edinburgh 80 years ago. The firm grew on the back of their sales of sausage, haggis and black pudding and they later opened a small factory in Newhouse, Lanarkshire. But it was the move to Broxburn in the 1960s which saw it become a household name.
The business was bought by Vion Food Group in 2008. With 1,150 permanent staff and 595 agency workers it is one of the largest plants of its kind in Scotland.
Vion UK chairman Peter Barr said: “This is an extremely sad day and one we have strenuously tried to avoid for the past four years, but the huge losses being incurred mean we believe we have no alternative. Every possible step has been taken to secure the future of the business but we are currently losing £79,000 per day at the site, which is clearly unsustainable.”
Mr Barr said: “If the consultation exercise does not reveal a viable way forward for this plant, a proportion of the work from these facilities will be transferred to other Vion UK plants. We will make every endeavour to identify other Scottish producers who may be able to produce some of these products.”
Vion Foods UK has reported a loss of £39.6 million for the 2011 year – more than double the £14.9 million loss posted the previous year. The UK subsidiary of Netherlands-based Vion NV, said turnover for the year was £1.17 billion, down from £1.21 billion the previous year.
In annual results filed to Companies House, Vion UK said its business, “like the wider UK economy, has faced a challenging year in 2011, with results behind target”.
It added: “In 2011, food companies found themselves being squeezed between input cost volatility, with record grain prices, unprecedented livestock prices for beef and lamb, and continued fuel and packaging price inflation, and consumers whose household budgets were under relentless and growing pressure.”