Ford UK (Duty of Care to Visteon Pensioners)

Peter Bottomley Excerpts

Tuesday 4th December 2012 Westminster Hall

[Nia Griffith]

Indeed. We often hear the word “mis-selling” used in relation to financial products, but that is far too kind a word, which suggests some kind of mistake. I call it a complete rip-off, a complete betrayal and an absolute disgrace in relation to what people were told and what the reality turned out to be. Clearly, somebody knew what was going on.

[Sir Peter Bottomley (Worthing West) (Con)]

Is the hon. Lady saying—if she is, I agree—that the people in Ford knew that the Visteon pension scheme was not as soundly based as the Ford one? Does she think that the main board in the United States is aware of this history in detail?

[Nia Griffith]

I am coming to that point. In fact, it was the Ford actuarial team that decided the amount of the transfer. The initial £49 million deficit in Visteon’s pension funding was clearly determined by Ford.

Can anyone imagine that there were not already thoughts, in some big boardroom in Ford, about how it could get rid of its liabilities—that nobody had in mind the thought that its biggest problem was the pension deficit and how to fund it for the future, and wondered what it could do to get rid of that? Can anyone tell me that they really believe that Ford had not already thought of hiving off the bits in the supply chain for which it could get cheaper prices, thinking that it could use its 90% purchasing power over Visteon UK to force down prices, before it embarked on the separation plan? It seems clear to me that Ford was determined to drive down prices even further than what it had agreed in the separation plan.

I agree with the hon. Gentleman that there was a very determined plan from the beginning. To me, it seems that there was a cunning plan: Ford wanted to maximise profits and to drive down costs on the backs of the workers in Visteon UK plants. Once it had managed to hive off certain sectors and to form Visteon, we heard that Ford was starting to drive down prices to ones that were significantly lower than those in the original separation agreement.

We also found that Ford tried to source components elsewhere. There were the dreaded confidentiality agreements: “Don’t tell Visteon that you’re making the bits that we get from them now, and that you’ll stockpile them so that we have them ready for when we get rid of Visteon altogether.” Do not tell me that somebody was not already thinking about that right back before 2000. If we look at the whole thing from beginning to end, there was a distinct plan of maximising profits for Ford and trying to get rid of the parts of the company providing components that it could find more cheaply elsewhere.

For Ford to do that on the backs of workers who worked loyally for it for 20 or 30 years is absolutely despicable and totally morally reprehensible. I fully concur with my hon. Friend the Member for Swansea West (Geraint Davies), who said that people have to make ethical choices about from whom they buy products. People need to know how Ford has treated the Visteon workers.

--- Later in debate ---

[Stephen Metcalfe]

I agree with my hon. Friend entirely. That aspect of the case will be tested in court, to see what promises were made and how they were communicated to the work force. What I am championing in Westminster Hall today, with other colleagues, is the case that Ford must meet its moral obligations to its former employees. However that is achieved, I believe that Ford has a moral obligation.

We have heard about other allegations of unilateral price changes, which of course Ford denies; of the pension fund being underfunded, which could be explained as a technical issue involving different valuations; and of Ford moving work away prior to the collapse of Visteon to ensure that its supply chain was not interrupted, and it is interesting to note that Ford never lost a day’s production because of the collapse of Visteon.

However, I will return to my main point one more time before I finish. I suspect that Ford did not want the hassle, the expense or the reputational damage of shutting down its expensive British parts manufacturers or other expensive plants around the world, so it spun them off knowing that ultimately it would be able to source the parts cheaper elsewhere and knowing that Visteon UK probably had no long-term future. I believe that that was known at the time that Visteon UK was spun off.

[Sir Peter Bottomley]

I referred earlier to the main board of Ford United States. My reckoning is that five of the present board members were directors from before 2000: Edsel B. Ford II; William Clay Ford Junior; Irvine O. Hockaday; Ellen Marram; and John Thornton. Homer Neal was also possibly a director from before 2000, which would make six current directors who were in that position. Could they be asked what they knew, if they still have the relevant papers and whether they were ignorant of what was going on in a major supplier in this country?

[Stephen Metcalfe]

Yes. That is a very interesting point and one that, as a group, we should pursue. We have been communicating with Ford UK and Ford Europe, but we should take this matter all the way to the main board of Ford in America.

It is interesting to note that the arrangements in the US are different from the arrangements here. The former employees of Visteon in the US have not been disadvantaged in the same way as the former employees of Visteon in the UK, and if this issue was on the doorstep of Ford’s head office and the 3,000 Visteon employees had been so disadvantaged closer to home, we might have had a different outcome.