Following the announcements of temporary manufacturing closures and the expected shutdown of much of the UK’s automotive sector in the coming days, Unite, the union representing many auto industry workers, has called on government ministers to introduce measures that will ensure that no business will go to the wall due to the coronavirus crisis.
“The government must ensure that the entire manufacturing sector is ready to ‘leap out of the gates’ when car plants and other firms that have temporarily closed due to the coronavirus reopen,” Unite said on Thursday (19 March).
The union said the government must facilitate the ‘mothballing’ or repurposing of non essential manufacturing and allow workers and businesses to weather the crisis so that they emerge unscathed and ready to go once it’s over.
Unite assistant general secretary Steve Turner said he was continuing to advise the government that its policies of providing interest bearing lines of credit or bridging loans to firms and statutory sick pay or universal credit (welfare payments) to workers was simply not good enough from what is the fifth richest country on the planet.
As well as introducing wage subsidies of at least 75% of earnings that are already in place across much of Europe to sustain workers and preserve vital skills, Turner called on ministers to provide interest free loans and suspend a range of business taxes to allow firms to prepare to spring back into action once the crisis recedes.
He said: “The government must ensure that UK manufacturing is primed to leap out of the gate once the shutdowns are over and the virus defeated. Like France’s president Macron, the UK government needs to commit that no otherwise viable business will collapse as a result of the coronavirus pandemic.
“It should also go without saying that with much of the industry shutting down, workers should not be left on reduced earnings fearful of bills or bailiffs, shivering and struggling to cope. Ministers must take direction from the likes of Austria, Germany, the Netherlands and many other European countries and introduce direct, in [the] pocket wage subsidies as a priority.
“They must also go further than offering loan guarantees by providing interest free grants and suspending business rates, VAT, corporation tax, national insurance and other tax payments alongside utility standing charges for the duration of any closure. It is also essential that businesses be allowed to temporarily ‘mothball’ as an alternative to closure and layoff or liquidation, with essential workers retained at work in the business and the remainder put onto gardening leave, with employment contracts and service secured.
“These measures are particularly important for smaller supply chain companies and their workers who will be hit hard by automotive shutdowns. Some facilities may have the ability to repurpose their output to produce vital medical equipment or other products that will be needed during the crisis. For others production may have to stop but that doesn’t mean that planning and other work has to.
“Now is the time for the government to give industry and workers the resources and breathing space they need to meet the future with confidence. They must ensure that UK manufacturing can spring back into action once the coronavirus is defeated and is ready for the opportunities as well as the challenges ahead.”
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