Remploy

Frank Doran Excerpts

Tuesday 16th October 2012 Westminster Hall

[The Parliamentary Under-Secretary of State for Work and Pensions (Esther McVey)]

I congratulate the hon. Member for Glasgow North-East (Mr Bain) on bringing this important debate before the House. It is also a pleasure to serve under your chairmanship, Mrs Osborne.

I have met the hon. Gentleman and other hon. Members who are present on various occasions—if we did not meet in person, we have spoken on the phone—about their Remploy sites. Everything he says is correct, but I want to consider everything in its entirety, because we all want the best support for Remploy staff, not only now but in the future.

We have to be open and honest about why we have this case for change, which is about sustainable work and sustainable jobs. We have to consider all disabled people of working age, which at the moment is 6.9 million people, 2,200 of whom work in Remploy factories. A fifth of the £320 million supports those in Remploy factories. Those are the finances.

However, we are also considering sustainable employment, what disabled people and disabled organisations want and what Liz Sayce’s report says. Many people want to work in mainstream employment. They want to look at different ways of engaging and moving forward. We have taken all that into account, and also looked at the losses that were being accrued year on year—£70 million. I appreciate that four years ago a £555 million package was put in over five years for a modernisation plan. However, targets were not met. They were not realistic and they did not allow the factories to continue, because they required an increase in public sales of 130%, and that just did not work.

I know that 28 factories were closed in 2008. We hoped that that could be the end and that the others would move forward, but that has not happened. As an additional way of mitigating the risk of redundancies to employees, Remploy was looking at how to put a commercial process in place. That process had to work with the Remploy staff; it had to work as a proper business model, work with Government and work with everybody whom it would touch. That is what we were trying to do, so the commercial process for stage 1 was open and transparent. It was published on the Remploy website on 20 March. That process was developed using expert advice on its design and structure and it took into account the need to ensure that employees and employee-led groups had an opportunity to take part actively and develop robust bids. The process has taken in excess of five months, and it continues.

[Mr Frank Doran (Aberdeen North) (Lab)]

I am grateful to the Minister for twice giving me the opportunity to meet her and discuss the process in detail. The latest meeting was yesterday. One concern that I did not raise with her is the persistent belief, at least among the staff of Remploy, that the best factories will be cherry-picked by the management. When I raised the issue with her predecessor in the House, I was assured that there would be independent oversight of the whole process. First, who is conducting the independent oversight of the process, and, secondly, will a report of their findings be made public?

[Esther McVey]

Recognising the need to ensure proposals were robustly addressed, an independent panel was set up to provide independent assurance to the assessment process, and the panel is playing an active part in what went on. I can write to the hon. Gentleman with further clarification on that, but that was one of the key facts.

There was also encouragement of employees and employee-led groups to take advantage of a £10,000 support fund for expert advice, and also a time-limited tapered wage subsidy of £6,400 to successful bids to keep on disabled members of staff. That came about because of Remploy and the Department’s responses and the various people who came forward to look at that.

On the factories that the hon. Member for Chesterfield (Toby Perkins) mentioned—Chesterfield and Springburn —discussions are going forward. Information was put on the Remploy website in September. Nothing has been finalised yet. It is going through due diligence at the moment, but it is in best and final offer stage and getting all the support it needs. We are still waiting on facts.

--- Later in debate ---

[Esther McVey]

We have indeed, and I will be in Edinburgh on Monday. We will have continued dialogue on that subject. I also hope to meet the factory workers in Edinburgh and while I am there I would like to see as many staff as possible—those who do not have their job now and those who do. There is an open invitation for people to come and meet me, and I will be in the factory.

The hon. Member for Glasgow North East also raised the issue of TUPE. Any purchaser of a Remploy site will have to offer a pension scheme in which transferring employees can accrue future rights. If TUPE regulations apply to a transfer, purchasers will have to match employees’ contributions up to 6% of pensionable pay, in line with pension legislation. We understand that for the Springburn site TUPE regulations will apply to the transfer.

I hope that I have answered as many questions as possible.

[Mr Doran]

The hon. Lady answered my question about whether there was independent oversight, but not my question about whether a report on that oversight would be published.

[Esther McVey]

I will find out and let the hon. Gentleman know. If there is, he will be the first to know.

Specialist Disability Employment

Frank Doran Excerpts

Tuesday 10th July 2012 Commons Chamber

[Maria Miller]

The Remploy factory in the hon. Gentleman’s constituency will be taken forward; I am not sure why that is not on his list.

[Mr Frank Doran (Aberdeen North) (Lab)]

Our thoughts today must be with the 1,400 Remploy workers losing their jobs and facing probably a lifetime of redundancy. Of course, I am delighted that my factory in Aberdeen is going forward, which is a tribute to staff and management at the Aberdeen factory. It has been achieved, however, in spite of Remploy management’s failure to provide any useful information that would have allowed for any financial planning or even to talk about taking forward social enterprises. I hope that the Minister will ensure that in the second phase these things will be a key part of the process.

[Maria Miller]

I thank the hon. Gentleman for his comments. As for the factory in his constituency, I spoke to the Scottish Government this morning. They are keen to try to continue with their support, as they have been working with us throughout the process. We will of course take forward any lessons from the first stage of factories into the second stage, but I think the process has been handled well and thoughtfully, and with the right level of professionalism.

Disability Benefits and Social Care

Frank Doran Excerpts

Wednesday 20th June 2012 Commons Chamber

[Mr Frank Doran (Aberdeen North) (Lab)]

I am disappointed that the Minister focused mainly on scoring political points. She will be well aware, because my colleagues have made many representations to her, that Remploy workers see many problems with the process for the transfer of the factories, but she addressed none of those. It is the Opposition’s job to oppose, but she has ministerial responsibility and I would have liked to hear her view on some of the points that have been raised.

I will focus my remarks on the Remploy factory in my constituency and the broader context in which it is trying to function. The Aberdeen factory was scheduled to close in the most recent round of closures, but we managed to save it. In the past couple of years people in the factory, with the fine assistance of the manager, Mr Ben Mardall, have been planning to develop a programme that would see five or six types of business in the existing factory. Currently, the factory works in the textile business and furniture refurbishment; it also has a small market garden, which has been sponsored by BP, a canteen, and aspirations for a commercial laundry, and it is reaching out to other social enterprises in the area. I have organised a meeting quite soon with representatives of a number of those social enterprises to consider the development of a social enterprise hub. Added to the industries would be a development programme for work placements so that long-term unemployed and disabled people would have the opportunity to work, gain proper training and experience a variety of different types of work to improve their skills and build up a CV. We see the possibility of such a facility as an important contribution to the city’s resources. Remploy’s management have never been particularly commercially minded—I think this is the first time that any commerciality has been seen in the Remploy process.

Experience in the company is limited, but the management seem to have become completely hung up on commerciality and to have abandoned almost completely the principles of social service, which were the hallmark of Remploy’s previous 70 years’ operation. For example, the process for transferring the factories is long, cumbersome and often difficult to interpret. The management’s communication with the work force is in business-speak, convoluted and, most of the time, inaccessible to most workers, many of whom are vulnerable individuals. Many workers are completely bamboozled.

Most Remploy businesses and workers have had their hands held for the past half century—it is not the way in which I would operate, but it is the way in which Remploy has—and they are finding it difficult to understand what exactly is expected of them in order to move forward.

When the Government’s decision on Remploy was announced, social enterprises wanted to look at the factories and businesses that might become available, but they were told that they could not have access because a consultation period was under way. It may be hard to get these people who were interested in the factories back again.

There are also tight deadlines for the applications, and I know that many representations have been made to the Minister on this point. It is a virtually impossible timetable—partners have to be brought in and business cases put together, and finance has to be raised for any new start-up. It is worth remembering that the previous round of redundancies started with a consultation in May, ended in November and was not implemented until January—and the factories closed with redundancies in March. The 90-day period, which mirrors the consultation period on redundancy, is totally inappropriate to a business situation, so I hope that the Minister understands why we think that the Sayce report was much more realistic than the current arrangement about what to expect and what could be achieved.

There is also a growing sense also that the process is not there to help Remploy staff to move on and create new social enterprises, which many wish to do. There are also strong rumours of a likely management buy-out of the remaining 18 functioning factories, and of the work of the closing factories being transferred to those remaining factories, but that would diminish the viability of any social enterprise that might emerge out of the closing businesses. That is a serious conflict of interest for the board, so I hope that the Minister will examine the issue and consider whether new management, or at least arm’s length, independent consultants, should be engaged to consider the whole process of factory transfer.

In the meantime, I urge the Minister to take a more hands-on approach to what is happening to Remploy. She can change things. When the closures were announced, the press were extremely critical of the Government, even though the main problem lay with Remploy management over many years.

From years of contact with my local Remploy factory in Aberdeen and with others throughout the country, I know that there is potential for something very real and very positive to come out of this process. There is an opportunity for disabled people to run their own social enterprises and businesses, and to develop facilities to help others to find employment, which is what will happen at the Aberdeen factory if we are given the chance. All they need is a fair chance. They are not being given one by Remploy at the moment, and it is the Minister’s responsibility to ensure that they are.

Employment Support

Frank Doran Excerpts

Wednesday 7th March 2012 Commons Chamber

[Madam Deputy Speaker (Dawn Primarolo)]

Order. There are still a lot of Members wanting to get in. We therefore want short questions and short answers.

[Mr Frank Doran (Aberdeen North) (Lab)]

No one will be surprised to hear that the workers in my local factory were devastated by today’s news. They feel particularly angry because for the past two years, the management and the work force have been working together to try to develop a social enterprise that would include not only the Remploy workers but other voluntary organisations around the city. They have gone a long way down the road to achieving that, but there is now huge uncertainty. My reading of the literature that has been produced today is that the factories are to be closed, which means that—

[Madam Deputy Speaker]

Order. I will say it loudly this time: we want short questions, please, not speeches. Mr Doran, a question—now!

[Mr Doran]

I would love to make a speech, but I am trying to avoid one. The future of the factory is crucial. There is a possibility of saving jobs in Aberdeen, so will the Minister confirm what will happen to the factories?

[Maria Miller]

We are going into a 90-day consultation on phase 1 factories. If individuals want to come forward because they feel that there are opportunities to reduce the level of redundancies, Remploy would obviously be pleased to look at them.