The closure of Rover involves the loss of 26,000 jobs, in the plant and the industries that supply it. The present owners were called in to “save” jobs. All they have done is siphoned off millions for themselves. The only answer is nationalisation under workers’ control.
Last month, after 100 years of production, the lights went out at the Rover plant in Longbridge for the last time. This marked the end of the last British volume car producer.
In 2000 BMW tried to shut down Rover. That was in spite of hundreds of millions of pounds in government subsidies over the years, which they were not asked to return. Instead of nationalising Rover at that point, which they could have done free of charge, the government along with the trade unions brokered a deal with Phoenix Venture Holdings (PVH). PVH bought Rover for a token £10 from the previous owner BMW, who also paid a £450 million interest free loan to sweeten the deal.
In this way PVH, in reality four executives; Towers, Stevenson, Beale and Edwards (the Phoenix Four) were able to acquire a multi-million pound company for a tenner. They say that you get on in business by taking risks and putting everything on the line. These four executives put up the price of a pint of beer each and walked away with a billion. Over the last five years they, along with Rover CEO Kevin Howe, have awarded themselves £40 million in pay and benefits. These are ring-fenced so the receivers will not take a penny of it. There are no shareholders to answer to; the Phoenix Four are the sole owners of PVH.
Where has all the money gone?
In the run-up to the collapse The Guardian reported financial irregularities. In their five-year term PVH set up a web of companies between themselves and Rover and somewhere in the morass money has gone missing. For example eleven thousand cars, worth £90 million, have disappeared from the inventory since 2000; there is no explanation of where they have gone. Rover’s income over the past five years was at least £1.3 billion, while losses have only totalled £900 million. Where is the missing £400 million?
Four hundred million pounds missing; but now 6,000 workers in the plant and 20,000 supplying it have redundancy hanging over their heads – £400 million split evenly between the Longbridge workforce would give them £75,000 each. But they will get a maximum of £3360, less than two months wages for most of them.
This is a bombshell for the workers who have mortgages to pay and children to feed. It will be more difficult for them to find decent jobs than the papers are making out. One thing that there is no shortage of in the Birmingham area is unemployed skilled industrial workers and they will all being going for the same jobs. To add insult to injury many of the workers who were offered cheap credit deals on their cars, as a benefit, are being faced with demands for immediate payment of anything up to £10,000 from Rover’s creditors.
The Market
The government now wants to provide a few crumbs for retraining ‘it is sad but what can you do? It’s the market.’
The market should not be more important than people’s lives! In the 1970s when Rover was in trouble the Wilson government took the company into public ownership, even the Tory government of Heath nationalised Rolls Royce to prevent its collapse!
Some on the Labour left like Mark Seddon, who sits on the Labour Party NEC, were calling for government support to keep the company going. He called for the government to take a stake in Rover along the lines of Renault in France in order to reduce its dependence on the market. One suggestion that he made was that all future contracts for police cars should be placed with Rover.
Many on the Labour left seek to shield the worst effects of the market by pouring in state aid to subsidise profits and bribe the capitalists to keep the plant open. This is not a solution, as was the case with BMW in 2000, it will not stop them from pulling the plug anyway when it suits them. It amounts to nothing more than subsidising profits.
Nationalisation under workers’ control
The problem with past nationalisations is that they were done in the interests of business. They provided cheap coal, steel or transport etc for the British capitalists. Company structures were not changed and in many cases the same managers, and fancy pay-packets, remained.
The only solution for Rover is nationalisation under the control of workers themselves. There should be no question of job losses. If there is overcapacity in the car market the skills of Rover workers could be used for other socially useful projects such as producing transport vehicles as part of an integrated transport policy.
Since Labour came to power one million manufacturing jobs have been lost and replaced with low paid service sector jobs. We must fight against any further job losses. We are fighting for decent, skilled and well-paid jobs for this generation and future ones. The unions must demand that the Labour government nationalises Rover and puts it under the control of the workers. The unions could use our industrial and political muscle to make sure that they do. We also need a coordinated campaign to take our struggle into the Labour Party to kick out the Blairites and put forward socialist policies in the in the interest of the working class.
- Prevent further asset stripping by occupying the plant.
- Demand the opening of the books for union inspection.
- Demand that the Labour government nationalises Rover under workers control and management.
- Demand that the Labour government expand and use the skills base in Rover to implement an integrated transport plan as part of a socialist plan of production.