Business Minister calls on Young's to deliver on commitment to ‘do right by the people of Annan’.
In a letter sent to Young’s Seafood, Business Minister Paul Wheelhouse told the company they have a ‘moral obligation’ to support the community that has served the business loyally over the past ten years.
Mr Wheelhouse reiterated the severe implications for the community of Annan and while the Scottish Government will use all its power to support workforce requirements at this time, has urged that Young’s step up to take tangible action to lessen the ‘bitter blow’ through efforts such as financial contributions to legacy projects.
In the letter, Mr Wheelhouse wrote:
CEO Young’s Seafood Ltd,
Your announcement last week to now proceed with the closure of the Pinneys of Annan site was not unexpected, but it is, as we have discussed previously, still nevertheless extremely disappointing and a bitter blow to your employees, their families and the wider community. Indeed, this decision comes in the wake of your most recent trading update which shows the group is now seeing a pattern of sales growth in both the frozen and chilled categories.
You will be aware that the Scottish Government and its partners have worked closely with your team to explore a range of alternative options to maintain your presence at the site, but none of those options were deemed by the company to be attractive or viable or in some cases had been discounted during your previous, internal deliberations.
Our focus is now, therefore, on identifying and supporting any potential new investor to the site. As you know, it appears at least one credible investor has come forward and we are now in dialogue with them on the package of support that could be available from the public sector to help secure their investment in operations from the site. However, I understand the determining factor will ultimately be the commercial terms of the deal and I would hope that Young’s Seafood approach any discussions and negotiations in a fair and reasonable manner with the best interests of the workforce and wider community in mind. This would be in line with, and keeping to the spirit of, the commitment of the company to me that you want to “do right by the people of Annan”.
Given the complexity of any discussions around the terms of a sale with potential investors, I expect it will take some time before any final agreement could be reached. As such, I would ask for you to re-assess your current plans to transfer the natural salmon production to your Grimsby site in July and, instead, in parallel, put on hold the next phase of redundancies planned for then.
As we do not yet know what the workforce requirements may be for any potential investor it would seem to be premature to release more staff in July until we have clarity on this specific aspect – this would then give us all some flexibility in terms of retaining what might prove to be key personnel for securing an investor through protecting vital expertise and skills for a bit longer and, crucially, giving continued employment and income for employees who wish to be retained in local employment rather than transfer to sites further afield. There will obviously be commercial factors to be considered but the Action Group would be willing to discuss with you what additional support might be available to enable such an approach to be taken by Young’s to maintaining staffing throughout the summer. I should add that I previously raised this issue with Marks and Spencer and they did not raise any objections given the decision to transfer the production to Grimsby was made by Young’s.
More generally, I do of course appreciate you need to make decisions that secure the future commercial viability of the wider group and I appreciate Young’s remains a key employer in the area, in terms of scampi production. Nonetheless, this decision now has severe implications for the community of Annan that has served the business so loyally over the past ten years. I therefore strongly believe Young’s Seafood has a moral obligation to support the community of Annan in the aftermath of its decision and one way this could be done is through an appropriate financial contribution to support associated legacy projects.
The purpose of these projects would be to sustain and ultimately grow the local economy which will be extremely fragile given its exposure to job losses at the Pinneys site – some initial suggestions include the creation of a dedicated ‘Annan Action Team’ to work intensively in the town to attract inward investment, business growth, and stimulate employment opportunities; and another is around enhancing transport links to other towns or cities to help aid current employees commutate to alternative places of work. I know that our partners in the Action Group have other ideas, so I’d like to discuss both the principle and the details with you. Clearly the Scottish Government and public agencies are considering what resources we could all put into such legacy projects but that should not prevent nor preclude Young’s also considering a suitable resource contribution.
We have also previously discussed how best we can ensure the long term competitiveness of scampi production in Annan and you have reassured me that there are no plans to change Annan as your location of choice for scampi production. Indeed we have discussed the potential to grow this further to expand the operation and attract more employment. You indicated that your Operations Director, Steven Lidgett, would provide us with some initial thoughts on this but we have yet to receive any information – I think this could present a good opportunity which we would be very willing to work in partnership with you to scope out the options. I would welcome receiving more information in this regard in early course to allow us to commence those discussions and considerations.
Finally, I know you appreciate this is an extremely difficult time for your employees with so much uncertainty about their future. You will know our PACE team is already working hard to support the employees and identify alternative employment opportunities for them, and I appreciate the good support your team is providing to facilitate this effort – for example, in supporting any jobs fairs. The Scottish Government is absolutely focused on securing continued employment for the workforce and I hope that we will have your full support and cooperation as we seek to do so, as we know that will deliver the optimum outcome for your colleagues affected by redundancy.
It would be helpful if we could meet again at the site in the near future or so to discuss these issues in more depth.