Bombardier - The Facts

While Labour locally have been making vocal protests about the award of the Thameslink contract to Siemens, rather than to Bombardier, local Liberal Democrats have been busy lobbying behind the scenes and getting some facts together. The Lib Dem transport spokesperson in the House of Commons has been in correspondence with Theresa Villiers (Minister of State in the Transport Dept.) Local Lib Dems have had a face-to-face meeting with Norman Baker the Under-Secretary of State and we have had a series of questions put to the government in the House of Lords.

It now seems quite clear that, when the Labour government drew up the tender document in 2008 (signed by Ruth Kelly, if we want anyone to blame) they did so without having much idea of what they were setting in motion. As has already been established, the government does not have now, and the Labour government did not have then, any socio-economic data on the train-building industry. Indeed it seems that no-one in the Labour government was performing the kind of analysis that Manchester University and the Nottingham Business School have performed. No-one in 'New Labour' worked out what outcome would be in the best national interest. They left the problem for the incoming Government to face, careless of the industrial costs to the East Midlands and beyond.

Thameslink was a PFI contract to provide trains and their maintenance over 30 years. Siemens could obtain cheaper finance than Bombardier giving them a great advantage in this type of contract. Lib Dem Business Secretary Vince Cable said it simply: the tender document was so narrowly drawn that there could be no other outcome. In other words, the Labour government either drew up the document suspecting that Siemens would win, or else they had no idea what they were starting.

Despite our initial scepticism, local Liberal Democrats have had to accept there is little this government can legally do to stop the contract going to Siemens. The only legal option would have been to cancel the Thameslink contract entirely and re-launch it under different terms. Even then, EU competition law does not give the government a free hand and we are informed that the delay in getting trains delivered would have been at least 2 years with knock-on effects throughout the rail network.

Just for once the Liberal Democrats find themselves agreeing with the Daily Mail when it said: "… if this Government is serious about rebalancing the economy, it must look beyond blinkered PFI-style contracts drawn up in the spirit of Gordon Brown's rush to get anything he could off the national balance sheet.

Let's be clear. Derby did not lose out because its workers were inefficient or its trains of poorer quality. It was pipped because it wasn't such a clever financier as Siemens. Hardly a sustainable basis for ensuring an enduring manufacturing base"

The Liberal Democrats fully support the coalition government's intentions to re-balance the economy and strengthen the manufacturing sector. We also support the government's phasing out the PFI-style contracts so beloved by Gordon Brown. It is mainly because Labour made the contract a PFI contract that Siemens was best-placed to win it.

So, what can be done? In the short term the government has drawn up a task-force to try and mitigate the effect of these job-losses in the Derby area (not all of which were to do with Thameslink!). Also there are a couple of new contracts that Bombardier would be well-placed to bid for in the short term. In the medium term, the Crossrail contract has been put back a year. There is currently a review of public procurement under way, which is examining the UK's application of EU procurement rules. The review will consider any actions the Government need to take to help ensure that UK businesses can compete for government work on an equal footing with their competitors.

The important thing is to ensure Bombardier Derby's long-term survival both as a manufacturing plant and as a design centre. Our meetings and correspondence with Ministers give Liberal Democrats in the East Midland cautious optimism that the Bombardier plant in Derby will indeed survive.

Derby Liberal Democrats are campaigning to get an Enterprise Zone for Derby on the Number 10 website.

Liberal Democrat Cllr Joe Naitta has set up a petition on the website calling for an enterprise zone in Derby. If 100,000 people sign up to the campaign it can be debated in parliament.

The petition can be signed at here

Liberal Democrat Cllr Joe Naitta said

"An enterprise zone is something Derby desparately needs. The loss of the Bombardier contract and the cutbacks at Egg and Celanese the recession has hit Derby hard. Derby urgently needs an enterprise zone to deliver jobs and investment to get our city through these tough times.

"I would urge everybody to sign the petition so that we can get the subject onto parliament's agenda."