The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)
As the right hon. Lady has said, Rolls-Royce announced this morning that as part of an ongoing restructuring of its business, it intends to reduce the size of its worldwide management and support workforce by up to 4,600. As the company’s main management base is in Derby, it has said that that is where the biggest reduction will be felt. Although the company will embark on a statutory consultation with staff and unions, it is obvious that the news will come as a blow to the workforce, and that this is a very worrying time for the dedicated and talented employees who did nothing to bring it on themselves, but who will be affected.
Rolls-Royce is one of our most important companies. It is a world leader in new technology, and plays a vital role in our industrial strategy. I spoke to Warren East, the chief executive, yesterday evening. Mr East explained that the company’s view is that the job losses are a necessary part of a drive to make the business more efficient and therefore more competitive. The jobs are principally in management and corporate support facilities rather than engineering and operational roles. Rolls-Royce has informed me that the announcement does not reflect a reduction in growth by the company; indeed, it reflects the reverse. It has a growing order book amounting to more than £170 billion,[Official Report, 25 June 2018, Vol. 643, c. 3MC.] and Mr East told me that it would need more staff directly employed in both the manufacture of components and assembly to meet that demand. The company has told me that it will continue to recruit engineers, technicians and apprentices. It is continuing to invest in research and development. It invested £1.4 billion last year, and about two thirds of that investment was in the United Kingdom. Last year it filed 704 patents, more than any other single UK company.
When I visited Rolls-Royce at Derby just a few weeks ago, it was to break ground on the new test bed, part of an £150 million investment to ensure that the next generation of aero-engines will be built in Derby for many years to come. We will work closely with the company, the unions, the local enterprise partnership, councils and, of course, the right hon. Member for Derby South (Margaret Beckett) and other colleagues to ensure that each and every worker is supported in finding new work. We will continue to support a company, and an industry, of which we can be proud, and our biggest contribution will be to ensure that everyone in Derby, and in Britain as a whole, is able to benefit from a growing, modern economy that creates good jobs now and will do so long into the future, so that when jobs are lost, people can find new ones to support themselves and their families.