Harland & Wolff rescue deal hailed as saviour for 400 jobs at threatened Scottish shipyards

A Labour MP has hailed a looming rescue deal for Harland & Wolff as a “victory for workers” amid reports the Titanic shipbuilder is on the brink of a £70 million government-backed package.

Ministers are expecting to announce on Thursday that Harland & Wolff (H&W) and its four UK shipyards are being acquired by Navantia, the Spanish shipbuilder, following months of negotiations.

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The deal will likely see sites saved at Methil in Fife and Arnish, near Stornoway, in the Western Isles where more than 400 jobs are based. Navantia's board is expected to meet to ratify the deal in the next couple of days.

Richard Baker, the MP for Glenrothes and Mid Fife, claimed the deal had been his priority since being elected earlier this year.

He told The Scotsman: “This expected deal will be a huge victory for the workers, local management and everyone who has fought so hard for the Methil yard. This has been my priority since being elected and securing this deal will show the new Labour government is delivering for Fife and investing in the future of our local communities.

Richard Baker MP said saving the site had been his number one priority | Richard Baker

“The Navantia deal is almost secured, but the key issue for me as the local MP is we now need an ongoing commitment and workable plan by all key stakeholders and all levels of government to ensure lasting stability for the yard.

“The 200 skilled workers and apprentices at Methil are vital for our local economy and our future in renewables. They have faced too much anxiety in recent years, but I believe we can now look forward to a brighter future.”

The future of the company had previously been in doubt after the previous Conservative government refused to guarantee £200m of loans because of the "very substantial risk taxpayer money would be lost".

Founded in 1861 by Sir Edward Harland and Gustav Wolff, the firm acquired the two Scottish yards three years ago.

Under the deal, Navantia will take over all of H&W's sites. The Spanish group is expected to pay about £70m for H&W's assets, and also benefit from improved terms on a government contract to build three Fleet Solid Support vessels for the Royal Navy.

In return, it is expected to provide guarantees that it will retain H&W's existing workforce for a specific period, though details of how long have yet to be confirmed.

The rescue deal looms after administrators were originally appointed for H&W in September. The company claimed at the time that between 50-60 immediate redundancies were expected, but that staff employed at its four shipyards were not affected.

The GMB union had previously said uncertainty around jobs came months after the company hailed plans to turn its Scottish sites into manufacturing hubs for renewable energy with new quays and a floating dry dock.

Gary Cook, GMB Scotland senior organiser for manufacturing, said in September: “Both the Scottish and UK governments have made promises of a ‘just transition’. It’s now time for them to keep those promises and secure the future of these yards.”

Matt Roberts, GMB national officer, said this week: “This is good news for UK sovereign capability and capacity in renewables and shipbuilding, but challenges remain.”