Skinflint's City Diary
Lord Ryder may be playing a deeper game than one gave him credit for. When he produced his original report on British Leyland, it was disappointing that although he proposed al' sorts of ways of making the company 3 profitable entity, with organisational and management restructuring, with cash injection and government aid, he did not make the continued support conditional on employee co-operation. This aspect had always been one of the gravest problems of the company and unless the gross overmanning and the perPe", tual strikes were eliminated, no amount 01 assistance was going to make Leyland a sound enterprise. Since there was no such safeguard in the report, Lord Ryder seemed to be uncovering just another rathole to Pour, taxpayers' money down, with every prospect that the chaos and inefficiency would continue as under Lord Stokes.
And of course they have. It seems amazing
that some Labour MPs and others of the idealist left still seem to imagine that all you need to ensure industrial and social harmony is nationalisation. Nearly thirty years of strikes in nationalised undertakings do not seem to have convinced them that union disruption is unconnected with the Marxist class struggle, arid IS instead prompted by the desire for more inuneY, less work, and better working conditions. And occasionally by sheer bloodymindedness.
Over the past year Leyland has lost some
thing over 100,000 vehicles as a i.suIt of strikes within the company (i.e. not counting the Problems caused by the strike last year of the Scottish lorry drivers, or the one at Dunlop this Year), and there is every sign that the trend is continuing. That of course is only the most bh_latallt part of the company's labour problems. rroductivity within the Leyland group is about the worst in the world, even after the most generous allowance is made for underinvestinent. Output per man at Leyland is about one eighth of that in the Japanese companies such ,asProYota or Nissan. so even when they purport to be at work, the Leyland employees are not exactly breaking their backs. Given such a background it seemed Lord "Ver was making himself a hostage to fortune ,u3.go ahead without safeguards. In retrospect `bias. may be his gesture to show good faith since „e,ix now talking of cutting off financial help ;.niess the car factories improve their produc' uvitY and strike record. But it really is not as easy as that. For a start the car workers are Acunfident that the Government would just not u,are to throw any serious numbers of them out eLor \York and that it would certainly not permit „ r.d Ryder to withhold money and thus ,PreJudice the company's survival. As proof of 'his attitude the strike-prone Cowley works gruund to a halt just one day after Lord Ryder's \Yarning. It was moreover typical of the gratuitous disruption which has made British
Yland notorious.
of For two hours they stopped work as a result t' s4)Me argument about shop steward elecmiuns, thus losing production of some fifty a,,artrlas. A footling excuse apparently for an gurnent, much less for a stoppage, but in fact lef;vaa Part of a power struggle by extreme `.-wingers (said to be Trotskyists) to maintain wort'orst hold on the troubled plant, currently the even in British Leyland. If this was not J„Ust a last-ditch attempt to keep the unions t'iihder local left-wing control, it may indicate a at sc'oner or later Lord Ryder is going to have confrontation with the unions. Reasoning ?Dears to have made no dent in the militancy 'fld Lord Ryder's bluff could be called. anWe shall then see just how independent he ,d,. the National Enterprise Board are, for the rJutical pressures to stump up the cash will be iistitense. Just how great will be the inducement G snown by the apparent willingness of the vernment to put up cash to keep Chrysler „ !Yea little longer in the UK. Although there is rilo rational case for Chrysler to continue, the :Pict redundancy of 20,000 of the 25,000 °titers has so worried ministers that they :le Persuaded Harold Wilson to ignore both men Think-Tank and the Industrial Develop-. ent gloom Advisory Board (which have both been -“Y about the prospects for the car industry an general and for Chrysler UK in particular), d .t° Pump £180 million of our money into the lioribund offshoot of the American company. 20 n,sis money is to ensure redundancies are not tin70 but only about 9,000. In other words at a spe,e,w. hen there is every pressure to cut public 'lug, and every expert thinks the company , should be allowed to die the Government is paying over £18,000 a head to prevent temporary unemployment (and setting up a competitor to the subsidised British Leyland).
It certainly is a high price to pay to prevent unemployment at Linwood near Glasgow, and hence to prevent Labour votes being appropriated by Scottish Nationalists. But it is an indication of the excessive importance the car industry represents in the thinking of the Government. Another is the kite flown that import controls are on the way and might well include cars. Such a prospect raised predictable howls from the Common Market and partly accounted for the rough ride Harold Wilson' had at the Rome meeting.
So what will happen when the BL employees, accustomed to years of threats from a management which in the end always climbed down just to get some production, stick two fingers in the air to Lord Ryder and continue on their disruptive way? In the past 15 months the group has suffered nigh on sixty strikes, and although there is a feeling that management is becoming less liable to knuckle under every time, it is unlikely that disputes will suddenly stop. The causes are too various for that — inter-union rivalry, Trotskyist disruption, political disputes between factions, lack of management communication, pay demands, and occasionally genuine grievances have all contributed to produce an unenviable record.
When the crunch comes Lord Ryder will have the option of saying that he has decided BL is not the viable concern he insists the NEB concentrates on, or he can announce that the only way to keep the company going is to cut back on staffing levels to a drastic extent. It is likely that he will say next spring that the finances of the car company have been so weakened by the continuing strikes that it has to reduce the scale of its operations. In other words several of the works will have to close down and thousands of employees immediately be laid off. It is of course still open to government to direct the NEB to put more cash into BL — which would however have to be specifically provided from the Treasury at a time when the Government is said to be trying to cut expenditure. For the moment Lord Ryder is talking tough — he said, "as a responsible individual I couldn't possibly authorise taxpayers' money if it was going down a bottomless pit." Since the bottom of the BL pit is certainly not visible to outsiders, it will be interesting how tough he will be in practice, or how tough he is allowed to be.
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