Getty rich quick?

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Nina rich mid 51% shareholding in Electric Machinery GEC buys AB Dick office equipment GEC buys Averys, a leading manufacturer GEC buys Hall Automation who make auto matic machinery for painting and welding. the-site negotiations ... we have enough experience to know that this is not the way to get the most productive and most efficient working."

Arnold Weinstock GEC management have pursued a policy of "product diversification"

This means that by buying companies in different industries you ensure that if a market collapses in a particular sector, you can marginalise the effect on your operations as a whole.

This has been one factor that has relatively insulated GEC from the cold winds of the recession.

The company has also applied a "get rich quick" short-term profitability strategy and steered away from a long-term investment orientation. Hence, though its present profits are very nigh, ils Ciabos HOulI on to its market share over the next fifteen years or so begin to look bleak given the fact that its principal competitors, especially in the engineering and electrical sectors, are pumping huge sums into devising new technology and new product lines for monopolising any future expansion. for long , term planning is a characteristic of UK capital as a whole, and reinforced by high interest and exchange rates, will entail that Britain' economic decline will be further accelerated in the 1980s.

A simple comparison of GEC with Japan's largest company, Matsushita, highlights the differences approach. In 1980 Matsushita (who own Hitachi) employed 12,000 people alone on the Research and Development side of their activities compared to a pathetic 160 for GEC. Similarly, the Japanese spent more money on R&D in the same year than the turnover for GEC's whole electrical engineering division!

Japanese We are not arguing for the introduction of Japanese management strategy • into Britain! Far from it.

We are saying two things. Firstly the historical divorce of Britain's finance institutions from the UK industrial base, and the consequent export of capital on an enormous scale, have set the parameters in which Weinstock and Co. have had to operate.

And secondly that only with a workers' government that took the whole economy into democratic, popular ownership, and that rationally planned invesiment in new technology, new product lines and the growth of Britain's industry, could this country stand a cat in hell's chance of not dropping down the economic hole.

Turnover Profits Profit before £7717 £475.

1976 1977 1978 1979 1980 1381 1982* 1983* *estimated Pre-tax Profit Dividends in 1 RECENT ACI Oct. 1978 April 1979 Nov.

Dec.

PROFITS Power Engineering £531m £61m Average wage per employee €1,297 £4,685 Pre-ta Profit 207.2 278.3 325.3 378.4 415.0 475.0 575.0 670.0 ce per I.

ISITIONS manufacturers.

of weighing and testing machines. £366m £41.6m Retail Index 83.6 281.0 sharehold Dividends 2.75p 3.62p 4.04p 6.25p 8.25p 10.25p 12.50p 15.00p Industrial Controls Corporation USA.

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Ro! Grantham - petrified of a successfi outcome' leliberately underprice their enders for US contracts -tence undermining the US ompetitor's position.

The "immutable laws" of free enterprise" obviously lo not apply when there is a ast buck to be made.

Hence, whilst fleecing inderdeveloped countries of heir meagre savings, GEC rosses have pleaded poverty • their domestic workforces n the annual wage negotitions. Consequentiy, shop tewards in the North West lants intend to bring these asreputable activities to the ull attention of the media nd every GEC worker.

State An AUEW-TASS member rom GEC Trafford Park, jut it well: "In many ways CEC is a state within a state. i sidesteps national laws and conomics when it feels like i; it rifles other counries' tills when it feels like i; it tells bare-faced lies bout its true financial posiion to its workers when it bels like it.

"In other words, because Veinstock has managed to livisionalise the company, plitting plant from plant, rhite collar from blue collar, pen from women workers, le knows he is in an invulterable position to proseute his fight against the nions."

On top of this Weinstock as just given himself a 141% rage increase, resulting in a lary of £141,000 a year! at does the average mployee get per year for his ard work? A paltry £5,541 er year.

Price-fixing

GEC's extraordinary rofitability is assisted by a ick of competition in most f its product areas, which nables it to push up prices • its customers. Significantr, GEC price-fixing activity • not just reserved for breign activities.

Along with BICC, Dezta -ad Pirelli, "Weinstock "corporated" have a long _adition of price fixing *sulated cable goods for teir chief customer in this phere, the rost Orice, as do se three manufacturers who supply British Telecom with telecommunications equipment, GEC, Plessey and STC.

So whilst Thatcher and Howe berate the unions for "disturbing , the free laws of the market" through collective bargaining, they openly support companies like GEC which unceremoniously trample such "laws" underfoot. Moreover, loyalty to the Tories isn't based on any naive patriotism or emotionalism about Britain. Far from it, for it is based on hard cash.

The Financial Times said recently, "Defence shares are all the rage on the stock market again following this week's outstanding figures from Ferranti and GEC as the government steps up defence spending after the Falklands war.

"There is agreement that GEC's 1982-83 profits will continue to grow strongly to around £650 million with super-optimists looking to around £690 million. Total dividend payments are expected to be raised from 10.25p to 12.5p."

Goliath

So what strategy has Weinstock utilised to build this goliath?

Firstly, when amalgamation took place he inherited particularly with AEl, a relatively powerful shop steward organisation that carried out negotiations on an inter-site basis.

The old Metro-Vickers inter-site committee in Manchester was probably the most formidable shop stewards grouping in the engineering industry. It had been formed from the concrete application of left-wing trade union tactics during the inter-war period. Its watchwords were "strike as one man, negotiate as one man, for all engineering workers in the company."

It marshalled 22,000 workers under its banner; it provided the power-base for Scanlon to become convenor in 1946, AUEW Divisional Organiser for Manchester in 1950, and later AUEW President....

But during the spate of wages struggles of the 1950s, the phrase "Scanny will show 'em" was a frequent call of craft workers as they battled both to increase wages and their differentials from other grades.

Scanlon Weinstock intuitively grasped that in breaking up shop floor organisation in his company should consciously utilise pre-existing divisions within the workforce that had not been resolved by the inter-site committees.

He divided up the old amalgam into separate companies (GEC Switchgear, GEC Scientific Instruments, GEC Traction, for example) and then argued that they should all negotiate separately.

He similarly encouraged independent negotiating procedures for white collar sections, as well as attempting to fragment Confederated (CSEU) stewards' committees on particular sites.

Hence, trade union organisation within the GEC KnOw our empire has been atomised, parochialised and demoralised over the last decade. Workers on one site, in say the Power Engineering Division, know little of wage rates, working conditions, new technology, etc., experienced by workers doing the same job at the sister plant down the road.

However, some light can now be seen at the end of the tunnel. Two important strikes have taken place in the last three. months at the GEC Traction Plant in Preston.

In the 1982 wage negotiations GEC Traction Management offered 850 Preston shopfloor workers 5% and demanded the introduction of three shift working. The shopfloor workers, mostly AUEW, rejected the offer and voted for immediate strike action on June 23.

Bitter

On July 5, after a bitter campaign that included mass picketing of other GEC plants in the North West in calls for solidarity action, management came back with a much improved package in total worth 92%. The package included:

*A general increase for all grades of hourly paid piece wolkers and time workers of £6.50 a week.

*A lump sum of £25 for all adult hourly paid workers.

*Improred sickness pay scheme - waiting days reduced from two to one.

As the strike had developed, Weinstock and his surrogates had threatened to close the plant and move production to South Africa. They also stopped the payment of sickness benefit to those members who were ill before the dispute began.

Workers even had regular Weinstock bulletins sent to their homes using Edwardesstyle brow-beating tactics.

Indeed before the strike began, Weinstock summed up his philosophy on industrial relations with a quote to the Financial Times com "People are elastic, the more work they have to do the more they stretch"

However, because of the rock solid action of the workforce, his Lordship decided to cut his losses and concede the essence of the ANDREW WIARD (REPORT) GEC'SI Carring Power Engineeri 1981 Turnover £531 m Profits £61m "mer Foreign 366m £41.6 strikers' demands.

A weakness of this struggle had been the lack of involvement of white collar workers. But only a few weeks later 200 clerical staff in APEX and ACTSS came out after rejecting the same offer management had initially placed before the manual unions.

The outcome of this struggle was the diametrical opposite of its predecessor. After a month of picketing during which TGWU drivers had crossed picket lines, the white collar worke workers were railroaded back to work by national APEX officials.

Roy Grantham ordered the summoning of a mass meeting of his members and made it absolutely clear that if there was no immediate return to work, even without an improved offer, then suspension from the union may well be on the cards.

An APEX member extracted the lessons of these strikes:

"If there's one lesson that's been hammered into our heads by these strikes, it is that we are going nowhere if we 'ry going it alone. We have build up a powerful coordinated combine organisation that can strike in unison against Carrington, Weinstock and the others.

"Unfortunately, drivers from the transport union continually crossed our lines. We have to correct these lapses in solidarity in the future. CHAIRMAN:

MANAGING DIRECTOR:

DEPUTY MANAGING DIRECTOR PRINCIPAL Industrial Electronics Telecoms & Automation £1235m £159.5r "Let's face it. Some people can turn around and say you've not got support from other GEC workers' and there's substance to this. We need to organise along the same product lines as Weinstock himself does. We need a combine organisation for the Power Engineering Division.

"This is the only way forward. Either these multinational managements are going to mould the workforce like a piece of plasticine, making it into anything it likes; or we are going to have to physically impose our economic and social priorities on the governing of these companies.

Buoyant

"As our strike was going on, national APEX leaders were petrified that a successful outcome might translate itself into a new buoyant mood amongst the activists in the union. They played an outrageously pro-management role during our strike by forcing the members back to work, with no improved offer.

"They might have had an argument that 'there was no more money' if we'd all worked for British Steel, but GEC is awash with money."

GEC does have

National Shop Stewards Committee which has met regularly since 1979 with the aim of devcloping unity and comradeship among workers Lord Weinstock Wage: £144,000. 1 2,779,441 - value Pay rise 141%.

Sir Kenneth Bond SHAREHOLDERS: Prudential Corpor Directors Interests £464m £38.7 Carrington Components Cables & Wires Consume Goods 290m £13.4m in all of GEC's 169 companies. However, plant attendance at the National Combine meetings is patchy and some shop stewards feel it is too broad and diverse a company to expect one combine to be able to develop effectively.

Some stewards have argued on the basis of the Preston strikes that combine organisations could be made more effective by organising around GEC's Divisional Structure, thus ensuring that when a strike occurs within say, Traction, then all Power Engineering Division shop stewards could easily be contacted.

Unfortunately the present National Combine excludes white collar unions, including AUEW-TASS. In this way, it is decisively crippled from really coming to grips with the Weinstock mafia.

What is needed is a combine organisation that embraces manual and staff unions and that builds up a political culture of solidarity between both work grades and plants.

Further discussions on these issues are now being made a priority by shop stewards in the company.

CONTACTS:, GEC Traction Works Committee, Preston. C/o TGWU, 228 Strand Road West, Preston.

GEC National Shop Stewards Committee, 40 Capital Road, Higher Openshaw Manchester 11.

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si Organiser no.112 December 9 1982 1

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Quick indeed, this "get rich quick" approach and disdain

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