CSC: Redundancies

Catherine McKinnell Excerpts

Tuesday 28th February 2017 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to see you in the Chair, Sir Edward. I congratulate my UK Parliament football club teammate, the hon. Member for Chesterfield (Toby Perkins), on securing this debate. I do not know about him, but it is certainly a while since I have been able to turn out for the team, and it appears results have been improving in that time—I am sure there is no correlation.

The hon. Gentleman’s excellent and powerful contribution brought a very important issue to the attention of hon. Members. He highlighted well the impact that the redundancies will have on his constituency and across the public sector. In Chesterfield, as he stated clearly, where CSC moves in, jobs move out. The size of the new company and its likely dominance of the market will therefore be of concern. Equally concerning is CSC’s lack of contact with its local Member of Parliament, particularly when it was about to become the subject of this debate. The hon. Gentleman raised some very concerning issues for the Minister to address.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

Since I am a Newcastle Member of Parliament, it may seem that my constituents are not directly affected by this debate. However, I have been contacted by a constituent who is employed by the company, is very concerned about the news and wants some reassurance from the Minister about the support that will be provided for those being made redundant. They may not all be at specific employment sites; they may be employed remotely around the country.

[Neil Gray]

I thank the hon. Lady for raising a salient point, which relates to some questions that I will put to the Minister later.

The hon. Member for Preston (Mr Hendrick) highlighted the fact that the behaviour of CSC in Preston suggests that it knew about the recently announced redundancies long before it notified staff. He also said that 20% of staff had been made redundant this year alone, which is a very concerning trend for a large Government contractor.

As the hon. Member for Chesterfield said, CSC is headquartered in Texas and provides IT services for a large chunk of UK Government organisations, including Network Rail, the Metropolitan police, the NHS, the civil nuclear fuels and the Departments he mentioned, particularly the DWP. It is clearly an important public sector contractor that works in sensitive organisations, so the current issues have far-reaching consequences. At the end of this month, CSC will merge with HP Enterprise Services to form DXC Technology and the new company is likely to be the largest single IT services supplier by some margin. In the run-up to the merger, CSC has announced two redundancy programmes under which 1,600 out of just under 5,500 staff will be out of the company by the end of March. Those are the latest cuts at a firm that has had nine separate redundancy rounds in this financial year. In parallel, it is also running a contractor reduction programme from a starting point of around 700 contractors.

Unite, the largest union that serves CSC employees, has stated that it believes that

“the company is critically endangering its own ability to continue to provide these services.”

It appears that many of the jobs will be moved abroad. That alone should be of concern to the UK Government, and not just because CSC is an important public sector contractor. As we approach the Brexit Britain landscape, how will we ensure that such jobs are not only retained but attracted here? The job cuts do not appear to be about the performance of the business in the UK, which appears to be doing well, as briefings have outlined. The UK Government must be concerned about the implications for the public sector organisations that rely on CSC services.

I hope the Minister will advise us whether the Government are concerned about the speed of these cuts; what support they will provide to try to protect as many of the threatened jobs as possible; what support they will provide to anyone who is made redundant, as the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) asked; and what contingency plans they have to deal with the impact of the cuts on the services provided to major public sector bodies.