Scott Lithgow: Free hand-out for the Tories' friends

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THE Tories' financial wheeling and dealing as they manoeuvre to privatise the Scott Lithgow shipyards on the Lower Clyde is slotting more and more into line with the various other dubious business deals currently creating an atmosphere of financial scandal around the government.

On 3 February a delegation from the Trafalgar House conglomerate visited the shipyards. They declared a readiness to take over the yards if the Britoil contract was restored and if the workforce was cut to 1,500. They claimed that no other company was interested in taking over Scott Lithgow.

Four days later, Trafalgar House and British Shipbuilders representatives met for discussions in London. The following day an outline agreement for the acquisition of the shipyards by Trafalgar House was announced.

The transfer of ownership would take place not later than the last day of February. Trafalgar House planned to cut 2,000 jobs straight away, and another 750 by late summer.

How much, if anything at all, was being paid for Scott Lithgow [current book value: £18 millions] remained unclear: initial reports said nothing, whilst the British Shipbuilders chairperson claimed that "it was not a free transfer, money will be passing to us in due course," without mentioning a figure.

Trafalgar House would also benefit from the government writing off Scott Lithgow's debts [£168 million], making the redundancy payments [£15 million] and providing further capital investments for the yard.

This agreement with Trafalgar House was reached before other bodies with an interest in taking over the yards [the British subsidiary of Bechtel and a consortium involving Howard Doris and Gotaverken Arendal] had had a chance to make an offer.

Moreover, it was British Shipbuilders who had approached Trafalgar House to suggest a take-over of the yard, not vice versa, and British Shipbuilders did nt admit Bechtel's interest until after it had already been reported in the media.

And from the point of view of 'straight' capitalist management and profitability, a Bechtel take-over makes more sense than one by Trafalgar House. The former is far more experienced in oil-rig construction than the latter, for example, and Trafalgar House has also admitted that it would have to buy in a new management team to complete the Britoil contract.

In addition, Trafalgar House hopes to win a contract from Sun Oil for an oil rig if it gets hold of Scott Lithgow. But the advisers for the Sun Oil rig are Bechtel.

None of this is to say that workers should take sides in the wrangling over which group of capitalists should get their money-grubbing hands on Scott Lithgow. The workforce needs to oppose privatisation itself, not privatisation to a particular company.

What it does show however is the extent to which the government must have been active in attempting to hand Scott Lithgow over on a plate to Trafalgar House.

This point is underlined by the fact that, faced with uproar at the announcement of the initial agreement, Britoil [effectively controlled by the government, since it owns 48% of it] suddenly announced an extension of its deadline for pulling out of the yards, thereby allowing other firms apart from Trafalgar House to make a bid for the yards.

In other words, the fate of thousands of jobs and the livelihood of thousands of families dependent upon them was being stitched up in backdoor deals which were not only closed to the workforce but kept secret from them as well.

Such financial chicanery underlines the need for workers at Scott Lithgow, and all other industries threatened with job losses, to demand the opening of the books and an end to secret negotiations and deals.