Manufacturing and Engineering (Northern Ireland)

Jim Shannon Excerpts

Thursday 6th February 2025 Commons Chamber

[Jim Shannon (Strangford) (DUP)]

I usually have the graveyard shift down in Westminster Hall on a Thursday afternoon. I think this exceeds that, given the time. It is a pleasure to have this important debate. I am pleased to see the Minister for Industry, the hon. Member for Croydon West (Sarah Jones), in her place. She has seen my asks, so I hope she can respond to them. I am also pleased to see the Secretary of State for Northern Ireland here, too. I will try to focus on the pluses that we have, and I then have a number of questions to ask the Minister. As she has seen those in advance, I hope we can have a positive glass half-full debate. That would be great.

It is a pleasure to see you in the Chair, Madam Deputy Speaker. It is not often we get to share time together, but you have me whether you like it or not, for at least half an hour or thereabouts. I am so appreciative of this time in the House to highlight the needs of the manufacturing and engineering industry in Northern Ireland. Northern Ireland has fast become a giant in aerospace. We have a skilled workforce, lower overheads and the perfect connectivity for business investment. That is what we have and that is what we do.

We have not only the manufacturing giant Spirit AeroSystems, but Wrightbus, Harland and Wolff and Thales—the list goes on. They are all supplied with specialist parts by a plethora of skilled smaller engineering firms that dot throughout the Province, in particular in Strangford. I must make clear from the outset that when I talk about the manufacturing industry today, I do not just mean the big firms; I am thinking of all the smaller firms that rely on this business. The impact on the local economy is massive. Indeed, Invest NI has highlighted that manufacturing accounts for some 11% of employment and 15% of gross value added, making it a key sector in the Northern Ireland economy. I underline that it is a key sector, and I cannot underline that enough. It is vital for Northern Ireland.

Northern Ireland is home to five companies with the SC21 supply-chain quality system gold award, out of a total of nine across the United Kingdom. Northern Ireland is again, as the Secretary of State will know, kicking on and working above the standards that many have for the United Kingdom. With five out of nine, we have more than any other UK region. We offer a reliable, successful, and competitive supply chain, with expertise in key technologies.

For automobiles, we are the world-leading region for the supply of tyre pressure monitoring systems, and we have leading capability in the manufacture of complex aluminium castings, as well as key strengths in the production of composite vehicle bodies for leading sports car brands. We do much in Northern Ireland. We have world-class solutions in the design and manufacture of mobile bulk processing and wet-processing equipment. When people buy from Northern Ireland, they buy 60 years of leading the world in mobile bulk materials processing equipment, and we manufacture more than 40% of the world’s mobile crushing and screening equipment. Again, I want to say these things because Northern Ireland often leads the way, and it is always a privilege to come and tell not only the world, but this Chamber about that.

The low-carbon sector employs more than 12,000 people in more than 300 companies, with an annual turnover in excess of £1.7 billion. Northern Ireland companies have the capability of providing a range of innovative products and services to address the specific needs of the various energy and water supply chains. The wastewater sector in Northern Ireland had a turnover of £1.1 billion in 2019, a GVA of £0.8 billion and 7,000 employees.

Northern Ireland is one of the most diverse consumer goods sectors in the UK, offering a wide range of design and manufacturing-based companies. More than 4,800 people are employed in the sector. Our companies have developed manufacturing capabilities and design or technology-led products and continue to remain competitive in a global marketplace. While that is the foundation of the big picture of manufacturing in Northern Ireland, I also highlight that we are yet to meet our potential, which simply cannot be met without greater investment, knowing that for every penny spent, the local economy reaps the benefit in pounds.

With that in mind, I have been in contact with and met the GMB and Unite unions representing Spirit, who have indicated the support needed in the sale of business transition. Spirit AeroSystems facilities in Northern Ireland produce parts for a variety of aircraft manufacturers, with about 45% of production on the wing and fuselage for Airbus. That work employs—

--- Later in debate ---

Motion made, and Question proposed, That this House do now adjourn.—(Gen Kitchen.)

[Jim Shannon]

I knew what was happening there; I just had not looked up at the clock. It is a pleasure to continue the debate.

I referred to the Airbus fuselage and how that work employs 33% of the 3,700-strong labour force. Labour-intensive contracts equate to some 47% of production—work for Bombardier and small aircraft manufacturers such as HondaJet and Rolls-Royce—and the remaining about 20% of work is in engineering IT, human resources, quality assurance and so on.

It is really important that we focus, if we can, on where we are. Boeing’s interest in purchasing Spirit is primarily about consolidating its own supply chain to ensure quality control. It has no interest in retaining production for its primary competitor, Airbus. Currently, Airbus’s intention is to take control of Spirit operations in its own supply chain; it has no interest in production for other aircraft producers.

Further challenge is posed by the fact that operations across Spirit sites are integrated. Workers are employed across different projects for different clients, so even if a division of activities under separate ownership were possible, it is unclear whether those operations could be sustained. That is one of our concerns. I look to the Minister and to the Secretary of State for Northern Ireland for some help on that. I believe the opinion of the unions is that the facilities must remain under one owner, as that is the only option that would guarantee and safeguard production. Airbus already operates a model that would make the retention of highly skilled jobs in Northern Ireland possible through, for instance, integration into the Airbus Atlantic group. That would include production sites across five different countries—that gives flexibility and strength across continents. Airbus already operates contracts with a variety of partners including, again, Bombardier, Dassault Aviation and ATR.

The Northern Ireland facilities are critical to Airbus and its future growth. Belfast is a vital supplier to the A220, and it cannot risk any disruption to production by taking control of the entire site. A single owner could avoid the outsourcing problems that have plagued Boeing, and disruption could also bring liability for hefty financial penalties. I have to underline that the workers in Belfast, who have given many years of service—their blood, sweat and tears—were the innovators and builders of the Airbus project. The unique expertise in Belfast cannot be easily replicated elsewhere. It is unique to us in Belfast, and it is important that it is retained as such.

According to reports, Spirit Belfast will be profitable if production increases to the planned-for 14 aircraft a month in 2025. The non-Airbus work at Spirit Belfast could be viewed as a bonus for Airbus, not a burden. Spirit Belfast has also recently signed two promising new contracts with successful aerospace companies that are likely to improve the plant’s profitability. Bombardier, which represents some 30% and growing of the work done at Spirit Belfast, has also been a customer for 35 years. There is clear continuity on the base and among the workforce.

All local political representatives and all parties across all of Northern Ireland, Spirit management and the Department agree with our demand for a one-owner solution as the best outcome for all workers, the aerospace sector and the wider Northern Ireland economy. However, to date, disappointingly—I say this with respect; I always do because that is the person I am—the chief executives of all the respective companies and the Secretary of State for Northern Ireland have failed to engage with senior stewards or the workforce. If that has changed, I will be more than happy, but whenever I met them a few weeks ago, that had not happened. They appear to be leaving thousands of jobs and livelihoods at risk or of being dictated to by the market.

This decision is not acceptable; neither is it in the best interests of the 3,700 workers impacted. It is imperative that the next course of action is to maintain and future-proof the highly skilled jobs and the approximately 7,400 jobs intertwined via the supply chain in the Northern Ireland economy. That would continue a vibrant and historic aerospace sector in Northern Ireland. The workforce need the support of central Government. I am quite sure that the Minister and the Secretary of State for Northern Ireland will reassure us.

Why is this important? Spirit AeroSystems is a linchpin of the economy in the greater Belfast area. Statistical analysis from the Northern Ireland Statistics and Research Agency, “Structure of the Northern Ireland Economy 2020”, published in September 2024, estimates that for every job sustained in the non-automobile vehicle production sector in Northern Ireland, almost two more jobs in the broader economy, local services and the supply chain are sustained through indirect and induced employment. For every one job, there are two more out there, so we get three for the price of one. Considering the high value-added nature of Spirit’s activities, with very developed local supply chains both regionally and across Britain and Ireland, that ratio is even higher. It is estimated that the 3,700 jobs at the company’s site in Northern Ireland sustain a further 7,400 indirect and induced jobs in the wider service economy and supply chain, based on the NISRA type II employment multiplier for manufacturers of other transport equipment.

The data is clear, and we need the help. Any threat to Spirit’s operations in Northern Ireland translates to a potential threat to more than 11,000 jobs in the wider economy. Such a threat would be devastating for the Northern Ireland economy, as the wages bill for the Spirit workforce alone amounts to approximately £250 million a year, contributing a large percentage of the region’s total economic consumption. It is not small fry; it means a lot to the Northern Ireland economy, as does the skill factor of those jobs.

The total expenditure of the company is estimated to be at least £600 million a year. The loss of this productive activity would have a huge impact on the Northern Ireland economy. This is key, vital and really important. Based on the 2024 NISRA estimate from a type II economic multiplier for the manufacture of other transport equipment, a reduction of £600 million in demand would reduce Northern Ireland’s gross value added by £1.4 billion. That is more than 3% of the region’s total annual economic output. That illustrates the vital importance of this sector.

Spirit’s production is also a critical element of Northern Ireland’s heavy industrial base and a key driver for exports. It is vital to the realisation of any regional manufacturing or industrial strategy that may be agreed at the Stormont Executive. These jobs represent some of the best employment opportunities for individuals who come from the working-class areas of Belfast and the wider community. The Secretary of State and the Minister know that—we all do. The cross-community employment at the sites benefits all working-class areas, with the jobs created having a profound impact on the transition away from a conflictual society. I know the Secretary of State is committed to that. I want that for our society. This is part of how we do that: we give people jobs and opportunity across the community, to help the community to heal and to move forward. I would certainly like to see that.

Youth employment opportunities in the aerospace sector are always attractive to young workers from all communities who are seeking to improve their lives. Just before Christmas, my right hon. Friend the Member for Belfast East (Gavin Robinson) and I visited the Thales factory. I was really impressed by their commitment to opportunities for apprentices. They are helping apprentices to earn a wage, and they look after student fees. They do not want just an apprentice; they want someone for their entire working life in that factory.

I am concerned that any loss of these skilled jobs would cast a very dark cloud over communities in Northern Ireland that are still emerging and transitioning from the legacy of conflict, at a critical juncture in the history of Northern Ireland. I never doubt that the Secretary of State for Northern Ireland is committed to finding a way forward. This is part of the healing process, moving forward and bringing us together. I ask the Minister gently to get involved—I do not mean that aggressively—and I ask the Secretary of State for Northern Ireland to expend every effort to advance a one-owner entity and ensure that, whoever buys Spirit AeroSystems’ operations in Northern Ireland, the vital social and economic importance of the jobs that it provides is fully recognised and safeguarded. That is in the interests of all stakeholders, and this great mother of Parliaments of the United Kingdom of Great Britain and Northern Ireland. It must be the overriding priority in the coming weeks and months.

I thank you, Madam Deputy Speaker, and all those who have attended tonight: the Minister, the Secretary of State for Northern Ireland, and his shadow, the hon. Member for Brentwood and Ongar (Alex Burghart), who has a deep interest in Northern Ireland. I speak as the MP for Strangford, and on behalf of the business and homes involved. It is not just about jobs; it is about every one of the 11,000 people who have a home, a mortgage and a family. Those people contribute to Northern Ireland, and want to contribute positively going forward. They are supported by the manufacturing industry, which, importantly, needs the involvement of the Government to secure a good deal. With a new US Administration and a desire to enhance relations between our nations, I believe that now is the time for action. I look to the Minister with the greatest respect, in anticipation of what she will tell us.

[The Minister for Industry (Sarah Jones)]

I thank the hon. Member for Strangford (Jim Shannon) for introducing today’s debate in his usual style of gentle persistence, and for the birthday message that he sent me back in December. I think he is the only Member of Parliament who sends birthday messages to every MP. The care with which he treats all of us is an example to us all.

I have a list here of all the good things about Northern Ireland manufacturing. The hon. Member has listed most of them already. For the benefit of the House, I will not repeat the case that he has made; I will just set out a few things about the Government’s approach. First, the Secretary of State for Northern Ireland and I, and others, were in Northern Ireland when we were able to announce a successful outcome on the Harland and Wolff deal. When we first came to power last July, it was one of the early industries in distress that came across our desks. We were faced with the possible collapse of Harland and Wolff, and there was absolutely no way we could allow that to happen. We all worked very hard to ensure that there was a deal that worked both for the Ministry of Defence, in terms of the fleet solid support contract for Navantia, and its commercial interests and what it could do, and for the workers of Harland and Wolff.

We did not do that because we are good people and we did not want to see job losses, although those things are true; we did it because the four Harland and Wolff sites are of incredible strategic importance to us. As it happens, I was in Methil yesterday, the Harland and Wolff site in Fife, where there is a huge future for offshore wind. The site can build part of that future. Sometimes we look through misty eyes at what has happened in the past in Belfast, and what Harland and Wolff used to be. The way we see it is: let us look at what it can be in the future, and how important it is. Of course it is important for people to have good well-paid jobs, but it is the talent and expertise they bring—which I see in spades in Northern Ireland every time I go; the enthusiasm, the talent, the training and the apprenticeship programmes—that mean we can build the future we want to see. They will be very important for our defence, but the whole ecosystem the hon. Gentleman talked about is very important for our future.

What support can the Government bring to ensure that people continue to flourish and thrive? First, we want to work collaboratively across the nations in a way that is productive and useful. I chair the business and industry inter-ministerial group in the Department for Business and Trade. At our first meeting, the hon. Gentleman’s colleagues in Northern Ireland, Wales and Scotland were there, too. What we can do collectively that helps all our nations is really important.

Secondly, the Government set the structure, through the industrial strategy, and a direction of travel that industry can understand. The hon. Gentleman will know that we are developing the industrial strategy. There are eight growth sectors where we think there is the biggest capacity for growth. We are working on honing down what the sub-sectors are within that. Advanced manufacturing, defence and green energy are all key areas that we have identified as opportunities for growth and Northern Ireland has such a role to play in that space. That architecture, which will provide the long-term stability over the next five to 10 years, will be really important and helpful.

The third bit of architecture is our universities, colleges, catapults, Innovate UK and all the other networks that help us to come up with new ideas and new businesses. I met Catapult Network chief executives this morning. They told me about—they were keen that I mention it in this debate, as I said I was coming here—some of the innovative work going on through the catapults in Northern Ireland. They are working with Invest Northern Ireland on hydrogen, which will accelerate supply chains for the hydrogen economy. They are working with Queen’s University Belfast to ensure that Northern Ireland’s manufacturing businesses can connect into national capabilities and help address future challenges. There is a lot of good work going on there.

The next bit of architecture is how we help all those businesses in Northern Ireland to export. I was in Saudi Arabia two weeks ago, alongside Invest Northern Ireland and Northern Ireland businesses, which were taking their huge talent and, I hope, doing some good deals. There was a business—I might get this wrong and have to tell Hansard to correct this—that makes kit that washes sand. It has washed 99% of the sand that needs to be washed—I am going to stop trying to go into detail!—in Qatar. It was a very small business in Northern Ireland that was, basically, providing a service to Qatar that nobody else could do. That was quite extraordinary, but that is the talent we have coming out of Northern Ireland and we want to work with Invest NI on that. We need to get the right architecture in place to ensure the future is bright.

I think what the hon. Gentleman also wants me to talk about is how we protect what we have. He made a very good case on Spirit and how it is not just the jobs, but the supply chain and all interactions. He used some very interesting statistics on the potential impact of closures. What I will say in this space is, first, that we all want the same thing. Secondly, just to correct the record, the Secretary of State for Northern Ireland, my right hon. Friend the Member for Leeds South (Hilary Benn) has met the trade unions to talk about that. I was at Spirit on 19 December and talked about the future. I have talked to all interested parties in this space. Collectively as a Government—the Secretary of State for Northern Ireland and the Secretary of State for Business and Trade, my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds)—we are trying to do what we can. It is a complex situation, as we know, and there are layers of complexity in terms of who does what. We are trying to do what we can. Government can only do what they can in trying to bring people together, come up with solutions and talk to those interested parties, but I think we are pushing in the right direction. Although I cannot click my finger and have the answer that the hon. Gentleman wants this evening, I can give him the commitment that we are doing what we can. If he has suggestions as to further meetings we could hold and things we could do, of course, I would be very happy to do that. I am having conversations regularly on Short Brothers and Spirit AeroSystems, as the hon. Gentleman would expect. I am talking to the aerospace industry, Boeing and all the interested parties.

[Jim Shannon]

I thank the Minister and the Secretary of State for Northern Ireland. I am happy that the meeting has taken place. Whenever I met them—it would have been three or even four weeks ago—they informed me that the meeting had not taken place. I am glad that it has, because that is better. When it comes to moving forward in Northern Ireland, things only ever happen when we all work together. That is important.

I also thank the Minister and the Secretary of State for what they have done in relation to Harland and Wolff. We appreciate that. I know it was complex and difficult, and that there were things they could not say when we asked in the past and things were happening behind the scenes. Could the Minister be involved in those contacts with Spirit and Unite and the GMB unions, again with the Secretary of State? That contact is important. I say to the Minister that she should bring people with her. If we bring people with us, we always win the case.

[Sarah Jones]

I am always happy to meet the trade unions. I think I spend more time with trade unions in government than I did in opposition. We are forever meeting, usually in very happy circumstances where we are all trying to push to the same end in terms of building industry and creating growth. I am therefore always happy to meet and to do that. Of course, it is not just Ministers who are in conversation; I should say that the officials are also talking to all the interested parties, just to see what can be done. But I will not deny that it is a challenge.

The two-pronged approach of trying to ensure we have the architecture to build our manufacturing and our industry in Northern Ireland, alongside trying to see if we can find a solution when it comes to Spirit, is the right thing to do. We should not ignore one or the other; we need to try with both and that is what we will do.

Encouraging new investment into Northern Ireland is also part of the picture. The Government’s investment summit and the work through the Office for Investment and the Minister for Investment really focuses on the strengths of a region and an area—the strength of a nation in this case—and the wonderful manufacturing ecosystem that we should be able to build on and which should be a very attractive proposition to investors who want to come in and expand.

I could talk more about some of the other examples of good practice and exciting things that are happening in Northern Ireland, but I do not want to keep the House longer than is necessary. The hon. Member has made the case very well, and I agree with everything that he has said.

[Jim Shannon]

I suppose the thrust of all the good things—we do not deny them but welcome them because they are good things—is to have the sale as one entity. On behalf of the workers, I especially ask the Minister to commit to looking at what more can be done for the Spirit workers. They are skilled, they are experienced and they are critical to Northern Ireland’s manufacturing base. That is my request to the Minister: to sell it as one entity and keep the workers.

[Sarah Jones]

I thank the hon. Member for that intervention. He is now looking at his phone. I do not whether the unions are messaging him during the debate, but if so, it is very effective.

Of course I will do whatever is useful in this regard. Commercial decisions are being made; we cannot influence all of them, but we can do what we can, and we are trying. We have a very skilled workforce that we do not want to lose, and I am happy to meet, work with and walk alongside our colleagues who are working in Northern Ireland.

I thank the hon. Member for initiating the debate. It is always a joy to talk about what is happening in Northern Ireland, and even more of a joy to be there and see it. I look forward to doing that again soon.

Question put and agreed to.