STUC general secretary: What happened at BiFab "nothing short of a disgrace"

STUC general secretary Grahame Smith spoke to the STUC disabled workers conference after the announcement that BiFab has been saved from administration

THE STUC GENERAL secretary has said that what happened at engineering firm Burntisland Fabricators (BiFab) is “nothing short of a disgrace”.

Grahame Smith told the STUC disabled workers conference that “it is beyond belief” that the 1,400 jobs at yards in Fife and Lewis where under threat because of a contractual dispute between BiFab and its customer Seaway Heavy Lifting (SHL).

Smith made the comments after an agreement was reached on Saturday (18 November), to prevent BiFab from going into administration.

The Scottish Government held talks with the Dutch-based SHL following a dispute with BiFab.

“The workforce of [BiFab] was left to face the consequence of there being no money to pay their wages beyond the end of this week if no solution was found.” Grahame Smith 

The deal means that work will continue on its current contract for the Beatrice Offshore Windfarm.

Smith said: “What has happened at BiFab is nothing short of a disgrace and it is as clear example as you will ever likely find of unacceptable behaviour from a multinational company.

“The customer, SHL, simply refused to pay the supplier, BiFab, for work that has already been done.

“The workforce of the company was left to face the consequence of there being no money to pay their wages beyond the end of this week if no solution was found.”

“You had a situation where SHL, part of a multinational company called Subsea 7, had taken out a performance bond -in effect an insurance policy - to insure itself against the prospect of the order not being completed.” Grahame Smith

BiFab warned last week that if no solution was found the company faced the prospect of going into administration.

Ministers said that a financial package will now be provided by SHL, SSE and windfarm partners JCE Offshore.  

The Scottish Government has indicated that it is willing to provide a loan to BiFab if required.

Scotland’s first minister, Nicola Sturgeon, said that even though this deal lifts the immediate threat of administration, there is still a long way to go to secure the long-term position of BiFab.

Read more – BiFab workers marched on Holyrood amid the “biggest industrial dispute in a generation”

Smith added: “You had a situation where SHL, part of a multinational company called Subsea 7, had taken out a performance bond -in effect an insurance policy - to insure itself against the prospect of the order not being completed.

“Surprise surprise SHL, having changed the specification of the order on several occasions, claimed that BiFab hadn't performed to its expectations, therefore cashing in the bond. I will tell you it is a lot of money.

“You might also be surprised to know that substantial part of that bond is underfunded by the UK Government, in other words, us as the taxpayers.

“If BiFab went to the wall and fell on the contract, SHL would have immediately pocketed the money at the expense of 1,400 jobs at BiFab at a big chunk of taxpayer money.”

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