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7.14 pm
Mr. Alex Salmond (Banff and Buchan): I congratulate the hon. Member for North-West Norfolk (Mr. Bellingham) on securing the debate, and thank him for allowing me to make a necessarily brief contribution to it. I welcome the fact that there is better news from Norfolk for the plants in his constituency.
I want to turn the Minister's attention to the fish division of Fisher Frozen Foods, which consists of the key plants in Fraserburgh and Peterhead in my constituency, as well as some important factories south of the border. It is the largest private sector employer in my constituency: some 700 jobs in a rural community that has experienced a number of closures and setbacks in recent years. The Minister will understand just how vital this subject is for my constituency. We are hopeful that there are buyers for the businesses as going concerns, but no deal has been signed and nothing is guaranteed.
A few weeks ago, when I raised this issue with the Leader of the House, he was kind enough to undertake that Government Departments—presumably the Department for Work and Pensions and the Scottish Executive Departments—would be standing by to ensure that any assistance that could be given would be provided to any new investors in these factories. Have approaches been made, either here or at the Scottish level, and does the undertaking of the Leader of the House still stand good? I hope that the Minister will be able to repeat it now.
The hon. Member for North Norfolk (Norman Lamb) may deal shortly with a receiver's duties and obligations to creditors. As I said, we hope and believe that KPMG is working hard to secure buyers for these plants as going concerns. However, a difficulty may sometimes occur when the receiver's duties are narrowly drawn, so that it has a duty only to creditors as opposed to a wider duty that encompasses the work force, the public interest in terms of the public purse, and the key communities. Will the Minister reflect on that?
I want to make it clear that I make no criticism of KPMG, because I hope and believe that it is as anxious as I and other hon. Members are to ensure that the factories are sold as going concerns. There may be a constraint in its fiduciary duties. Will the Minister make some observation on that, because it is in the interests of everyone, especially the wider social and economic interests of my constituency, that the factories are sold as going concerns and not for their break-up value?
7.17 pm
Norman Lamb (North Norfolk): I congratulate the hon. Member for North-West Norfolk (Mr. Bellingham) on securing this debate. It is good news that the plant has been rescued. We all thank the various parties who have played a part in making that possible. The hon. Member for North-West Norfolk, other Norfolk Members and I have worked together on a cross-party basis to facilitate a solution to the big threat that has hung over that part of Norfolk in the past couple of weeks. KPMG, the workers, the trade unions, the buyer and Anglian Water have all played their part in making this possible, and our thanks go to all of them. It is important for the economy of this part of Norfolk that the plant survives. This evening, we face the future with more hope than we did last week.
As the hon. Member for Banff and Buchan (Mr. Salmond) said, the duty on the receiver is very narrow: it is a duty to the creditors. The combination of that duty and the practical application of the TUPE regulations means that the interests of the employees and the wider community are not properly taken into account.
There is a problem with the TUPE regulations. Although they are designed to protect the rights of employees, when a company is in receivership they often work perversely in the opposite direction. They encourage potential buyers to hold back and allow the plant to close so that they may be able to buy plant and equipment without taking on responsibility for employees. My reading of the legal position is that, with the plant reopening so soon, it is almost inevitable that the receiver will get legal advice that it is selling the plant as a going concern and that the TUPE regulations should apply. If that is the case, there will be no redundancies and the redundancy pay that those workers are expecting will not be paid.
I should be grateful if the Minister would take away from the debate a plea for the redundancy payments office to make an urgent decision and communicate it to the workers. As I am sure he understands, there is a lot of concern among people who have made applications and are due to receive an invitation to return to work, but do not know whether they will lose payment, in particular for the period between the plant closure and the date on which they returned to work. Reassurance and certainty for those workers is clearly important, but at the moment they are receiving conflicting messages. The legal situation in such circumstances is often complex, as I am sure that the Minister knows, but we need certainty as soon as possible.
I am grateful for the opportunity to speak and thank the hon. Member for North-West Norfolk for giving me the chance to contribute. I should be grateful if the Minister would respond to my concerns.
7.21 pm
The Parliamentary Under-Secretary of State for Work and Pensions (Malcolm Wicks): I, too, congratulate the hon. Member for North-West Norfolk (Mr. Bellingham) on securing a debate on an issue which is important not only for his own constituency but for those of other hon. Members. I listened carefully to the points that he and other Members have made. Inevitably, I may need to return to some of the more detailed points in writing, or ministerial colleagues may have to respond.
Obviously, we now have better news about the situation in Norfolk, which will be welcomed by the people and communities directly affected. Not many days ago,
however, things looked much gloomier. Since the news broke of possible redundancies at the Fisher Foods processing plant in King's Lynn, our local Jobcentre Plus staff have been working closely with the receiver KPMG, the company itself and the regional development agency. Following the announcement of 350 redundancies on 10 June, open days were organised at a local conference centre on 12 and 13 June, which were attended by our Jobcentre Plus staff, local training providers and 18 local employers, as well as about 300 of the people who were made redundant.The local Jobcentre Plus office reports that the local labour market is buoyant, and it is advertising a large number of vacancies, particularly for people with food-processing skills. Our staff felt that anyone affected by the possible closure of the plant would soon return to the labour market. Indeed, the eastern region has a working-age employment rate well above the United Kingdom average. For example, in the hon. Gentleman's constituency of North-West Norfolk, unemployment has fallen by 57 per cent. and long-term unemployment has fallen by more than 80 per cent.. Moreover, since 1997, every region has experienced falling unemployment and rising employment.
In the past few days, our Jobcentre Plus staff have helped 50 people from the plant to find alternative work, and 50 more people have had job interviews arranged for them, obviously before we had had the better news. However, that shows how quickly our agency could swing into action. Fifty more people are believed to have begun arranging alternative employment themselves, and the remaining employees continue to receive advice and support from Jobcentre Plus.
We acknowledge that the farming industry is going through difficult times. The loss of an important processing outlet would have led to substantial repercussions for local farmers and the economy of which they are part, especially in frozen pea production, where a particularly close relationship between growers and processors is essential. I therefore welcome the announcement by KPMG today that it has succeeded in concluding the sale of that site.
I recognise that there are some remaining uncertainties, which were articulated by the hon. Gentleman and other hon. Members on behalf of their constituents. However, growers now have the assurance that the crop that is about to be harvested can be processed. The future market for peas grown in Norfolk lies in the hands of new owners. We wish them success in securing continuing markets for the product. The important and complex issues surrounding TUPE are not matters for my Department but for the Department of Trade and Industry. However, I will draw the remarks of the hon. Gentleman to the attention of my ministerial colleagues.
Mr. Bellingham: The problem that the TGWU senior steward has is that many people are saying to him that they would want to go back to the factory today, tomorrow or the next day to help on the pea campaign, but they do not know whether they can afford to do so if they are going to lose redundancy, so we need a decision on the matter tomorrow if possible, and advice from the DTI.
Malcolm Wicks: I will draw those remarks to the attention of the Department tonight and stress the urgency of clarification on what I know to be an important issue.
When it comes to entitlement to social security benefits, particularly the jobseeker's allowance, the fact that my colleagues in Jobcentre Plus are already engaged will enable advice about entitlement, should it still apply—it is a complex period—to be forthcoming from my colleagues.The hon. Member for Banff and Buchan (Mr. Salmond) raised important points about his constituency. Unfortunately, I did not know that he was going to speak in the debate, so I am not briefed on those issues, but the assurance given to him by the Leader of the House still applies. I will endeavour to ensure that colleagues in different Departments are apprised of the situation and that any help that can be forthcoming—I can give no guarantees of that—will be forthcoming. We all understand that it is always best in these situations if concerns can be solved as ongoing concerns, if at all possible, but obviously that is not a matter for me.
I understand the importance of the points made by the hon. Member for North Norfolk (Norman Lamb) about the complexity that may now surround the issue of redundancy payments. We will obviously want to give that due consideration too.
In such cases where redundancies are large, potentially large, or will have a major impact, we have what we call our rapid response service, which was introduced recently. The service helps the whole community to cope with the impact of significant redundancy by looking at the total picture rather than just at those being made redundant.
The service works closely with key partners such as the regional development agencies, the still fairly new local learning and skills councils—there can be a retraining issue—local authorities and trade unions to co-ordinate an effective response to redundancy.
The exact nature of the help is always tailored to the needs of the individual, the employer, the local economy and the labour market concerned. From April this year,
the service has received nationally an additional £6 million over the next two years, in order to strengthen its work.In the case of the Albert Fisher business, as we have been saying, it now appears that at the King's Lynn site there has been a successful outcome; we certainly hope that that is the case. I also understand that the receivers have had a number of offers for the eight remaining sites of the business and are conducting detailed discussions with all potential buyers.
The successful conclusion of the sale of the King's Lynn plant is in no small part due to the co-operation and co-ordination of the efforts of all parties involved, including the strong interest of local Members of Parliament—hence this debate. In situations such as this, Government Departments are very willing to assist in any way that is valuable or relevant to find alternative buyers or an alternative future for the employees. I acknowledge the work of my colleagues at Jobcentre Plus, who clearly moved quickly and had already found outcomes for employees before we heard the news affecting the plant.
It is important that we do all we can to ensure that firms continue in production if at all possible. In the first instance, that is a matter for the private sector, but we stand ready to assist companies or the work force in any way that we can, should they face redundancy and loss of employment.
In welcoming this debate on an important issue—perhaps nothing is more important for families than the future of work in such areas—I acknowledge that, for various reasons, I have been unable to answer all the detailed questions put by concerned Members. The issue cuts across different UK Departments, and also affects the Government in Scotland. I understand the urgency of these matters, and I will do my best to draw them to the attention of ministerial colleagues as soon as possible.
- Adjourned accordingly at twenty-nine minutes to Eight o'clock.
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