Euan McColm: Grangemouth workers on slippery slope to defeat

'It is not in the government's interest to allow the plant to remain closed for long'. Picture: PA
'It is not in the government's interest to allow the plant to remain closed for long'. Picture: PA
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WHEN workers from the shut-down Grangemouth refinery and petrochemical plant gather outside their place of work today, the demonstration will be one of impotent defiance.

There will be speeches about tradition and hard work and fairness, and a show of solidarity among thousands of staff who fear for their livelihoods.

But everyone participating will know that, as things stand, workers have little power in a dispute that has seen one of the biggest complexes of its kind in Europe cease operations. Owners Ineos are behind the decision to suspend production. And, since calling “everybody out”, union officials have had little power in negotiations.

This has not stopped the owners from placing the blame for the temporary shut-down on Unite and its negotiating team. But before we get to the game being played by management, let’s pick through the reasons the lights have gone out in the Grangemouth plant.

Things have reached this pass because of two issues. Unite first clashed with Ineos over the company’s decision to suspend, reinstate, and then launch an investigation into the activities of union convener Stephen Deans, who was involved in the row over the selection of Lab­our’s Westminster candidate in Falkirk, where he chairs the constituency party.

It was after the threat of a 48-hour strike over Deans’ treatment that a second factor – the need for cuts at the plant – came into play. Ineos has previously warned that Grangemouth loses £10million a month and will close in 2017 without investment and cost-cutting.

The union may have begun fighting over Deans, but the dispute was soon about cuts that would impact huge numbers of the plant’s 16,000 strong workforce.

As staff began shutting down the plant on Monday, politicians urged both sides to find a resolution. On Wednesday, Ineos called Unite’s bluff. It announced that not only was the Grangemouth site shut, but that it would remain so until it had secured the agreement of the union that in addition to abandoning the planned strike, it would not call any industrial action for the remainder of the year.

Ineos boldly played Unite’s trump card – the threat of shutdown – against it. And the union wobbled.

After meetings throughout Thursday, in which First Minister Alex Salmond participated, holding lengthy discussions with both parties, it seemed that a crisis had been averted.

Unite agreed to call off the two-day strike and offered a guarantee of no more industrial action for the remainder of 2013. In return, the union demanded that Ineos should not impose a pay freeze and pension cuts on the workforce, and would instead enter into further negotiations over the future of the plant.

Ineos’s rejection of the union’s deal was followed by a statement from Calum MacLean, chairman of Ineos Grangemouth (UK), in which the company attempted to cast Unite as wreckers. The union’s response was “unbelievable”, said MacLean, especially in light of the great efforts Ineos, and the Scottish and UK Governments had put in to reaching a deal.

The wording of the statement gave the impression that Ineos and the Governments were of a mind on the issues while it was Unite that had broken trust. In fact, political leaders in both Edinburgh and London have pointedly refused to take sides in the dispute.

Workers now have until Monday to agree to what Ineos has called a “survival plan” for the plant. This plan includes the pay freeze and pension cuts which Unite has already deemed unacceptable.

Salmond’s efforts –- and those of his finance secretary John Swinney – to find some resolution appear to have been exemplary. The First Minister believed he had succeeded on Thursday on laying the ground for a deal. That his hopes have not yet been realised appears to be down to Ineos rather than Unite. The refinery’s management – answerable to shareholders – is willing to offer no concessions to the workforce.

Unite is not blameless in this mess. The way it approached the Deans matter was disproportionate. It picked the wrong fight. But now that Unite is down (and make no mistake, the union will struggle to get back on its feet) it’s Ineos that’s putting in the boot.

I fear the workers of Grangemouth should now expect the worst. Ineos appears to hold all the cards. It is not in the Government’s interest to allow the plant to remain closed for long. It provides almost three-quarters of Scotland filling stations with fuel and, although there are supplies in reserve, panic buying could cause significant shortages within days.

A glaring problem for both governments and Unite is that Ineos is untroubled by the need for particularly good press over the dispute. This is not a household name that might easily be boycotted, a brand to be driven into contrition. Fuel shortages would mean a crisis for the UK and Scottish Governments, not for the company. And with a high demand for jobs in Scotland, the company knows it could easily rebuild a smaller workforce should that be necessary. Ineos appears to have nothing to lose.

Theoretically, both governments should have some power. Ineos has plans for a new £300m terminal at Grangemouth and wants a £125m loan guarantee from Westminster and a £9m grant from Holyrood. David Cameron and Alex Salmond could, of course, threaten to withhold that cash. I doubt that either will do so. There are jobs at stake, after all, and the complete closure of the plant would be catastrophic.

In time, today’s demonstration will be a memory. I doubt it will leave a legacy. Ineos has shown both an unwillingness to bend and an enthusiasm for grinding the union into the dirt. Amid fears that it might pull out of Grangemouth completely, I expect the company will get its way in cutting pay and pensions while receiving the Government support it wants.

The accusation from Unite’s Scottish secretary, Pat Rafferty, that Ineos is ­holding Scotland to ransom has a ring of truth. «

Twitter: @euanmccolm