Revealed: Historic Scots biscuit factory owners shifted production to England

Nearly 500 workers are under threat of redundancy over plans to close the McVitie's biscuit factory in Glasgow.

And Unite believes Pladis, the parent company - based in Middlesex and owned in Turkey is not fulfilling its duty to look at alternatives to redundancy by engaging directly with an action group led by economy secretary Kate Forbes about those options.

McVitie's owner Pladis said the Tollcross plant will close in the second half of 2020 with some staff angry that they are now going "the whole hog" and moving all production down south.

The Unite union which is campaigning to get a change of heart to save the Scottish jobs and has been tracking a "downward spiral" of the factory says that over ten years it has lost nearly 50% of its normal manufacturing volume over 10 years to Pladis factories in England.

McVitie's is a staple of everyday consumer life, as they create an array of nearly 20 brand name biscuits from Digestives, Rich Tea and Hobnobs to Club, Penguin and Jaffa Cakes It wants the Turkish owners to work with multi-agency Pladis Action Group to explore a new site or a bespoke centre of excellence for manufacturing in the sector including a distribution base - which could get the support of public money as part of a taxpayer-funded rescue bid.

Unions are also raising concern for the future of Scottish manufacturing saying there is a "trend" for getting out of Scotland from companies based outside the country to migrate work to England or other countries.

In 2019, it was announced that the Cummins diesel engine factory in Cumbernauld was to close with the loss of 130 jobs with work transferred to factories in England.

The American owners said the plant was expected to close because it needed £3 million of investment and could not compete in current economic conditions.

The firm had two premises in the Wardpark area of the Lanarkshire town, Cummins UK which repairs diesel engines and Cummins Recon which rebuilds them.

And two years ago 200 workers at the Springburn rail works, which handled repairs for ScotRail lost their jobs after the decision was made to close the depot, locally known as the Caley despite a campaign by Unite. Train repair work was transferred to England.

The historic depot under British Rail ownership once employed some 4000 workers and exported locomotives to all corners of the empire.

On Thursday, workers and union officials protested outside Holyrood before delivering a petition with more than 72,000 signatures calling for action to the Scottish Government.

But there is continuing concern that Pladis has not engaged directly with the Action Group, which includes economy secretary Kate Forbes, and had their third meeting on the same day.

It has forged ahead with consultation on redundancies, even though unions have been told the first cuts would not take place till December 31 this year, with the last at August 31, next year.

Unions are concerned that manufacturing has been taken away from McVitie's only remaining Scottish bakery to be placed in sites where there has been investment in production lines - its other UK factories in England - Carlisle, Leicestershire, Sheffield, Manchester and Harlesden which employ 4200 people.

The biscuit factory which makes Hobnobs has received already received nearly £1m in taxpayer funds till three years ago when it drew the last tranche of public funds.

Scottish Enterprise approved over £1,011,000 in grant funding to McVitie's Turkish-owned factory owners Pladis - with just over £895,085 being used.

Part of that included £193,000 taxpayer support approved by Scottish Enterprise to develop their Nibbles product in a £2.4m project to bring the brand to Tollcross from Turkey.

The rest of the fund was orginally approved in 2014 to allow for the upskilling of staff at Tollcross. Scottish Enterprise say it resulted in 485 jobs being safeguarded.

United Biscuits (UK) Limited, which is trading as Pladis, made a £63m pre-tax profit in 2019 - £5m more than the previous year.

Four years ago the GMB union raised fears for the factory's future and sought reassurances from managers over the factory.

The union raised worries Pladis was not committed long-term having been silent over the future of modernisation investment at the Tollcross site. Pladis had said it had invested more than £5m in the previous few years.

Now unions leaders have revealed how there had been a "sabotage" of the factory with the shipping out of responsibility for biscuit-making to England According to Unite, Tollcross now produces 21,000 tonnes of biscuits having moved thousands of tonnes of production from the factory in the past five to ten years to be taken up by factories in Harlesden, London and Manchester. Scotland consumer 27,000 tonnes of biscuits.

According to its analysis of company documents, there has been at least 11,000 tonnes of work lost to England since 2016 alone.

The latest shift of production came in 2020, when 1,198 tonnes of Digestives biscuit manufacturing was moved to Harlesden and Manchester. In 2019, 3774 tonnes shifted to Harlesden.

Some 2,857 tonnes of Rich Tea, 2,686 tonnes of Digestives and 644 tonnes of Hobnobs production was moved to English sites between 2016 and 2019.

Unite industrial officer Pat McIlvogue, who is on the action group, said the company owners have "manufactured the situation" where their assessments of its efficiency of the factory on a cost per tonne basis was set up to fail - by moving so much biscuit manufacturing volume down south.

"In the last two years, in particular they have transferred the work from Scotland to English sites and that has left a lack of volume in Tollcross that has been manipulated into a lack of efficiency and increase in the cost per tonne.

"Yet company's position is that they have too much capacity in Scotland and not enough volume.

"The fact is that despite the company not investing in the factory and letting it erode on the vine, the site was still hitting to performance indicators while at the same time the company are moving volume from Scotland down to factories in Manchester, Harlesden and anywhere else they could stick it.

"This is a situation that has been manufactured by the company, to suit a narrative to try and attempt to give an objective justification on the closure."

Generations of families have worked at the Glasgow biscuit works which first opened in 1925 as part of the Macfarlane and Lang's Victoria Biscuit Works.

The McVitie’s presence in Scotland goes back to the original Scottish biscuit maker, McVitie & Price Ltd, which was established in 1830 in Edinburgh.

The Digestive was a breakthrough innovation in 1892 that is still at the core of the business.

Known as McVitie & Price, it opened a vast London factory in 1902, where it still produces. The Digestive first got a chocolate covering in 1925, and the Jaffa Cake went on sale two years later.

The Penguin biscuit was developed by a rival Glasgow baker from 1932, and later became part of McVitie's. In 1948, it merged with Glasgow's big MacFarlane Lang to become United Biscuits.

Unite Scotland said it was pushing for more public funding support to ensure that the factory is not just a relic of history.

"Our first challenge was not to issue the redundancy notices because it was totally premature. There was no need if there was not going to be anyone made redundant this year and it was to be a phased redundancy process," said Mr McIlvogue.

"Kate Forbes wrote to Pladis and requested for them to engage directly with the action group we have set up to look at alternative to alternatives to closure which is part of their statutory obligation to mitigate the need for compulsory redundancies.

"The company was claiming the site at Tollcross needed £30m of infrastructure improvement to make the site watertight. We don't believe that to be the case, but anyway, we felt it would be better to put any investment into a new facility, that can give better efficiency and diversification into other products. "Pladis won't do this without support from the Scottish Government, it may come in the way of subsidy, or reduced rates on a greenfield site, development money.

"But the galling thing is that McVities refused to directly engage with the action group that has set up to look at the proposals and to engage with people who could potentially bring a subsidy. The proposals are a plan, and they are not fulfilling their obligation to look at alternatives to redundancy. It is a slap in the face for the Scottish Government and is totally remiss."

Paul Smith, a McVities machinery operator, from the Save Our Jobs Tollcross said the workers had felt a "betrayal" having worked through the pandemic to keep production going.

He said there was a fear that the factory owners were "not interested in listening" to alternatives.

"The strength of feeling out there in Glasgow and beyond is massive, the public are behind the workforce," he said.

"We are really relying on the Scottish Government coming through with a substantial financial commitment, hopefully that will convince the company to rethink their plans.

"The Tollcross McVities is like a family business. Generations of the same families have worked in, if it closes it will do terrible damage to the entire area."

A Pladis spokesperson said: “We continue to engage with our employees and their representatives on a weekly basis and remain committed to a meaningful consultation with them.

"We have also been engaging directly with the co-chairs of the Action Group Cabinet Secretary Kate Forbes and Councillor Susan Aitken on a regular basis."

Nicola Sturgeon said during First Minister’s Questions that the Scottish Government will "do everything we possibly can" to stop the closure.

“We cannot force a company to accept offers of help that we give, but we will do everything we can to make sure that those offers are credible and do everything to make sure that they are accepted," she said.