CLYDESIDE HAS SHIPBUILDING A FUTURE IN SCOTTISH RIVER’S YARDS?

Press, Volume CIX, Issue 32016, 17 June 1969, Page 14

CLYDESIDE HAS SHIPBUILDING A FUTURE IN SCOTTISH RIVER’S YARDS?

(Reprinted from the ‘‘Economist" by arrangement)

Upper Clyde Shipbuilders, Britain’s largest shipyard and shipbuilding’s biggest money loser, is to be bailed out again by the Government with £l3 million to give the five-shipyard group a second chance of proving that shipbuilding has still a future on Clydeside. It took weeks of pleading from U.C.S. to get the Government to find the money that the Upper Clyde’s management claims it must have to avoid liquidation when it has a £lOO- - order book. It seems they have succeeded—but only at a price. Whether or not they would have succeeded if Glasgow were not facing a by-election—with Labour on the defensive again—is another matter. It has happened before.

The Glasgow executives have failed to make the merger an initial success and the Government is in a mood now to force its own efficiency squeeze on the river. Although all Scotland’s political factions united in opposing the Government’s initial resistance to the pleas for more London money for the Clyde, there has been, it is claimed, no weakening in the Technology Ministry’s determination to cut the one-time pride of the Clyde to profitable size. We shall see. This sort of talk has been heard before. Redundant Men The nub of the matter, and the basis of much cynicism, is that Upper Clyde ShipBuilders, Ltd, the ungainly phoenix that arose from last year’s merger of five yards at Clydebank, Govan and the upper reaches, has been carrying 5000 more men on its payroll than it could conceivably find work for. The consequence of having the largest shipyard labour force in Britain (13,500 plus their support battalion of salaried staff) js that eomewhat between £5 million and £6 million is estimated to have been paid out in unnecessary wages since the merger, building up a financial millstone that now requires £l3 million of public money to reprieve U.C.S. from liquidation.

Clydeside is shouting all the more hysterically now because, if U.C.S. did disappear, the social consequences, even in a perennially high unemployment zone, would be regarded as unusually tough. And a Labour Government in London forgets Labour’s 42 Scots M.P.s at its peril. Closure Of Brown’s As no local politician will dare publicly to face the reality of the situation, which would mean that John Brown’s of Clydebank, which is to Clydeside what General Motors is to America, should close down to save U.C.S. from bankruptcy, someone else must do it for them.

At Clydebank (population 50,000) John ' Brown’s shipyard remains the principal source of skilled employment. But the bitter truth of the matter is that though the Clyde built the Cutty Sark and all three Cunard Queens, the last two ocean liners built at John Brown’s have lost more pounds than Scotland has people. In 1965 £3 million was lost on the Kungsholm, flagship of Sweden’s merchant marine, delivered five months late. The Cunard company let it be known this week that it is also claiming £3 million from John Brown’s as compensation for the trials and tribulations of the Queen Elizabeth 11. History Reversed

To many people on Clydeside these realities are a reversal of history. The modern Clyde came into being to build ships. Its uplands in Lanarkshire provided the coal, iron ore and steel, and Glasgow’s workshops supplied the machinery to power the industry and its products. If there is one single activity dominating the habits and the very education of Glasgow and its neighbourhood it is shipbuilding. And for every job which the Minister of Technology, Mr Wedgwood Benn, prunes out of U.C.S., at

least five others will be affected somewhere in central Scotland. Some claim it is bad management that got U.C.S. into difficulties; others say it is because the trade unions reverted, understandably, to the hedgehog tactics of the 1930 s when it became clear that the upper Clyde yards were in for a rough time. Whoever is right, it is 'ital that U.C.S.’s troubles are not loaded on to the other part of the reshaped Clyde, the lower reaches’ group of shipyards, just when they are finding their feet. These yards, ScottLithgow’s, have some 10,500 wage earners now working steadily and profitably through a £65 million order book. Upper Clyde has a £lOO million worth of orders—which looks impressive until anyone asks how much of the order book is actually profitable. Merger Shelved Until the waterlogged condition of U.C.S. was appreciated in London, Government pressure was to force a merger of the two groups. But this project has been shelved until it becomes clear whether or not U.C.S. can make a go of it The crux is whether there are enough jobs about on Clydeside to ease the shock of closure. The unemployment rate among Clyde shipyard workers was 4.4 per cent last month. But other industries are moving in. There are now more men working in RollsRoyce’s Scottish aero-engine factories than building ships on the upper Clyde. There are as many Scots working for Imperial Chemical Industries, even though modern chemical processes are a notoriously low user of manpower, than there are in the rest of the Clyde yards. All this may help to explain why nothing has been heard from that devoted watchdog of Scotland’s economy, the Scottish Council (Development and Industry). Not a single mention of the U.C.S. crisis has come from the Scottish Council through all the stramash about the shipyards. A Lost Cause? Some will say this is because the Scottish Council’s present chairman, Lord Ciydesmuir, as head of the steel-making Colville clan, feels it is better not to intervene in the troubles of so important a steel-user as shipbuilding. But it may also be because there are those in Scotland who recognise a lost cause when they see one. After all, Dundee, where not so long ago the jute indus-

try meant what shipbuilding still means to Glasgow, is now in a position where a single American-owned light engineering company, National Cash Registers, provides 6,575 jobs, many more than the city’s largest jute mill. What happened in Dundee can happen on Clydeside.

Later this month, the Scottish Council is to produce an interim report on the Clyde’s future as a deep-water terminal capable of constructing and harbouring vessels of 500,000 tons—without any dredging or other alteration of nature’s handiwork. But the report will emphasise that it is only on the lower reaches of the Clyde that these major waterside developments are feasible. Considerable sums will be needed if these schemes, and others like them, are to go through, and the feeling is that none should be prejudiced to maintain unwanted shipbuilding capacity on the too-narrow, too-shallow upper reaches of the Clyde. 80,000 Affected But if the estimates are correct, closing the Upper Clyde yards would affect more than 80,000 people in and around the shipyards, not to mention the small tradespeople who depend on their earnings. Not all U.C.S.’s yards need be closed, of course: Yarrow, for one, will continue; so, probably, will Fairfields, in spite of Sir Andrew Crichton’s outburst this week about the lateness (six months behind schedule now, probably ten months by the time it is eventually delivered) of the quite small, 29,000 ton container ship being built there for one of his companies. Five sister ships built in West Germany were all delivered, said Sir Andrew, on time. But the loss-making yards should not be kept open, at the cost of a public subsidy, merely to keep men at pointless work. If the Government is to put money in, it should give it to create new and more worthwhile jobs for the shipyard men. Shipyard trades include many that could usefully be put to rebuilding more of Glasgow’s slums more quickly, for a start. Last year there were not enough men around even to mend the roofs stripped by Scotland’s January hurricane.

Upper Clyde’s management asked for a float of £l3 million from the Government A lot of houses, public works, and jobs—and most important of all, confidence —could be obtained for that if spent more wisely than on U.C.S.