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Isle Of Grain Power Station

Volume 986: debated on Friday 20 June 1980

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Motion made, and Question proposed. That this House do now adjourn.—[ Mr. Brooke.]

2.31 pm

I thank you, Mr. Deputy Speaker, for allowing me to raise the vexed and sorry subject of the Central Electricity Generating Board power station at Grain in Kent. It may be of interest to you to know that this is not the first time that this site has figured in an Adjournment debate.

On 7 February 1977 my predecessor as the hon. Member for Gravesend discussed the result of a strike there, with particular reference to the distribution of unemployment benefit. While I hope sincerely that this will be the last time that we talk about industrial disputes at The Grain, as it is called, I fear that that hope may be optimistic.

As the House will know, three weeks ago on 27 May there were scenes of violence between the police and pickets outside this power station. In an official dispute the General and Municipal Workers Union had called upon thermal insulation engineers—better known as laggers—to come to Grain and aid 27 of their colleagues.

It was the boast of the GMWU that up to 6,000 pickets would assemble. In the event around 400 turned up, some from as far away as Scotland. Thirty-six were arrested and many thousands of pounds of ratepayers' and taxpayers' money was spent in providing police protection. The latest estimate of the cost for that morning is £30,000.

The freedom of movement of the small population of Grain village was disrupted and the result was that around 1,500 workers at The Grain led by John Baldwin of the Associated Union of Engineering Workers, in his official capacity, crossed that official picket line and went to work. They did the unmentionable and crossed the official picket line of another union because they wished to keep their jobs at Grain.

I know that my hon. Friend is well aware that, although The Grain is in his constituency, many of the workers to whom he has referred have, over many years, come from my constituency. I share his pleasure at the fact that he has the opportunity today to talk about a matter which—though it is perhaps the last of the present saga—is unfortunately part of a long continuation of dispute on that site.

I and my predecessor who represented Rochester and Chatham in this House have, on occasion, been called together to the site because of another industrial dispute. I support my hon. Friend today in the hope that the Minister will be able to give us some words of optimism as to the final resolution of this whole disastrous episode which has continued now over such a long time.

I am grateful to my hon. Friend the Member for Rochester and Chatham (Mrs. Fenner). This is not merely a local problem affecting two hon. Members. There are national implications in the events which I witnessed on 27 May at the temporary police headquarters at Grain.

If the The Grain is closed because the trade unions cannot agree among themselves—the closure is threatened by the CEGB—about £500 million of taxpayers' money will have been wasted. Perhaps my hon. Friend the Under-Secretary, to whom I am most grateful for coming here today to reply to this debate, would like to confirm that figure.

It is quite clear from an answer to a question which I put to my right hon. Friend the Secretary of State for Energy four months ago that up to December 1979 construction work at The Grain had cost the taxpayer no less than £433 million.

Looking back over nine years of building at the Grain, I believe that we must question management's ability to manage effectively quite as much as we must question the inability of trade unions to agree among themselves. I ask, too, what are the actual needs of the national electricity grid. Do we really need Grain power station on line with all five generators ; or is the Central Electricity Generating Board using the trade union quarrels to back away from what has become a white elephant? There are also the questions of law and order and, perhaps, most vital of all, of our ability as a nation to survive economically and make some industrial progress in the last two decades of the twentieth century.

I should like to delve a little back into the history of the Grain. Designed to be the biggest oil-fired power station in Europe, designed and started before the first oil crisis of 1973–74 and succeeding rises in the price of oil, it was originally estimated to be completed by 1979, and the cost was estimated at £209 million. Today, if peace happened to break out, the estimated completion date is 1983—four years late—and the cost would be about £500 million or £550 million, moving towards three times the original estimate.

The power stations that Britain built during the 1960s had been plagued by labour disputes, so when the CEGB started on the Grain it dispensed with multiple small contractors and looked forward to better labour relations by using five main contractors. Grain was to be the model. What a sick joke it has turned out to be!

There have apparently been no fewer than 28 site managers at Grain in nine years. Tea breaks could take 30, 40 or even 60 minutes. In short, productivity, to be polite about it, has been low.

Has my hon. Friend the Minister been given any up-to-date productivity figures for Grain? I am told that on a good site of this sort about 45 per cent of an eight-hour day is spent actually working. On a bad site the percentage is much lower, and Grain can only be described as a bad site.

One of the subcontractors, CDN, was reported as reckoning that Grain workers were 90 per cent, less productive than men doing a similar job elsewhere in the country. It was estimated that in 18 months at Grain CDN completed the equivalent of one month's production.

Early in 1976 the laggers at Grain went on strike to obtain protective clothing. For pertinent health reasons, asbestos was not now used in lagging, but there had been an American report that the material that the laggers were using—a glass fibre—gave off a dust that was linked to a type of lung cancer. The factory inspector was summoned, and agreed that the laggers should have protective clothing. But the management refused, saying that the American research was inconclusive. The factory inspector insisted, and the local manager then agreed with the inspector, but he was overruled by his bosses in CDN.

Some time later a compromise was agreed. The laggers were given a one-off loan of £125, repayable over five years, to buy the clothing. Satisfied, or reasonably so, they returned to work.

However, a short time later the scaffolders came out with the same demands for protective clothing, but there was one difference. They wanted free protective clothing. As a result of their strike, three men were dismissed, and by June the entire Babcock work force of 1,000 was out.

Here the factory inspector enters the scene again. He pronounced that the dust on the scaffolding where those men operated was up to 30 times above the acceptable level. But another expert said :
"The dust is no worse than what a cowboy puts up with when riding across the range. He just wears a handkerchief over his mouth."
It is possibly also worth mentioning that the scaffolders had been having rows with their employer over bonus payments. Was it dust or gold dust that they were after?

Those examples—there are many more—are surely the result of plain bad industrial relations. To be sure, bonus payments on the treasure island of Grain are a large part of the story, but would a capable management fight over the issue of a few suits of protective clothing—peanuts against the multi-million pound spending on that site?

As a result of that kind of management-labour contest, if the trade unions cannot agree and the laggers at Grain will not allow a ceiling to be placed on the bonuses that they earn, I believe that the CEGB has no choice but to carry out its threat of total closure.

During this week we have heard little news of progress in the negotiations. The trade unions involved have been in close touch, I believe, through Mr. Len Murray, as I hope they have also been in close touch with the CEGB. Perhaps no news is good news. I most sincerely hope so. Nothing would give me greater pleasure today than a message delivered, as I am speaking in this House, saying that the unions have settled their differences.

I congratulate my colleagues who serve on the Select Committee on Energy, who have grasped this nettle and will start an examination of the position at Grain on Monday. But if this tragedy continues to a remorseless ending and the Grain is closed, the Select Committee inquiry will, I believe, not be enough. We need nothing less than a full public inquiry to satisfy all of us who have paid our taxes for this project, if it should finally close. I hope that my hon. Friend the Minister can give me an assurance that this will happen in that sad event.

Last summer it became clear that the bonuses paid to the laggers had been considerably in excess of the work they achieved, although why it took quite so long for this to be realised makes me wonder. It could be said that the contractor could not perhaps have been too much bothered, because, under reimbursable contracts, the money was paid anyway by the CEGB.

It was, therefore, the CEGB which last year looked for some sort of agreement on uniformity of bonuses, and particularly that ceiling on hitherto open bonuses paid to the laggers, some of whom were reputed to be earning £300 or £400 a week, or even more.

The laggers claim that their work is skilled, that it takes four years' training and that it is dangerous. Early in the last century, lagging was done with wood or even cow dung. Then came asbestos, which we all acknowledge was very hazardous. I am informed that today the majority of their work is concerned with clipping pre-formed sections of lagging around pipes.

Has my hon. Friend any information as to the real need in 1980 for four years' training for a lagger? What evidence is there that the job is more hazardous than many others less well paid? Has my hon. Friend noticed that the new laggers at the Grain, who have been working there in the past week, seem to have been managing with a training of weeks rather than months or years?

But last August the 27 laggers stuck to their guns. They would have nothing of compromise unless they kept their open-ended bonus scheme. The sub-contractor in charge, CDN, was sacked on 5 December last year and a week or so later CEGB announced a stop on the two least completed units, Nos. 4 and 5, at Grain. Redundancy notices went to all manual workers on the site, and by 23 April this year there was still no agreement with the GMWU, the laggers' union, so CEGB announced the total closure of the Grain from June, with the resultant loss of a total of 2,000 jobs.

At this point the other trade unions on the site got together, led—and I emphasise led—by Mr. John Baldwin. They agreed that they would accept the CEGB bonus schemes and also agreed to allow laggers from other unions to train and to work on the site. When these new laggers—after a brief training, as I have described—started work, the mass picket of 27 May was the response given by the GMWU, in spite of its being well known that most of those original 27 laggers had found employment elsewhere.

About 400 people arrived to picket peacefully. Their peaceful persuasion included throwing bricks and stones through coach windows, heaving and scuffling with police, and generally intimidating everyone they could see. For how much longer does my hon. Friend expect the British public to put up with this form of peaceful persuasion? If the Public Order Acts cannot or will not be used by the police, does he really believe that this Government's Employment Bill, as it is today, will stop this mass thuggery and intimidation?

The laggers regard themselves as a closed shop. Surely, if we had followed many other countries and outlawed the closed shop years ago, we would have seen differently in Grain, and possibly none of the events that I have described would have occurred.

You may have noticed, Mr. Deputy Speaker, that I am not blaming anyone in particular. I am blaming everyone—the CEGB and its contractors for a long period of weak and ineffective management ; some trade unions, for being out of control of their members ; unofficial groups of strikers for lack of thought for their work mates ; and, on the evidence that I have seen, the laggers for wanting pay packets of hundreds of pounds in excess of other trades, when it would seem that they were hardly doing what could be called a full day's work for that reward.

I have been grateful for the opportunity to talk about Grain. We must save those 2,000 jobs, or as many of them as possible. That they might be lost because of disputes between trade unions is almost the great irony of our time. I hope that agreement will be reached. I am a member of two trade unions, and, if trade unionism is 27 workers, most of whom have found other employment, putting 2,000 of their brothers out of work—I want nothing of it.

2.45 pm

My hon. Friend the Member for Gravesend (Mr. Brinton) has spelt out a position that is of real concern both to the Government and to all hon. Members. I am happy to say that it is not symptomatic of all industrial relations, but it does represent the worst elements.

I share my hon. Friend's views, and that expressed by my hon. Friend the Member for Rochester and Chatham (Mrs. Fermer), that this should be the last time that we debate this sorry business in the House. I know that they agree that it is unlikely that a settlement of the dispute will be brought nearer by parliamentary debate. I am certain that no one here, or in the forthcoming hearings by the Select Committee on Energy, will want to say anything that may make the achievement of a settlement more difficult. I could not agree more with my hon. Friend that we all want a settlement. We recognise that the dispute can be solved only by the parties concerned. They must be conscious of the wide interest in their proceedings.

I understand that discussions involving the CEGB, the unions and the TUC are continuing. I also understand that lagging work on Grain has been proceeding satisfactorily for over a month. There have, of course, been differences of opinion, to put it no higher than that, between some of the unions concerned, but I am sure that the TUC offers the best forum for resolving such differences. Although the independent ACAS has a good deal of experience of the industrial relations problems of large mechanical engineering sites, it would not be sensible for ACAS to volunteer its services at the moment, though it remains ready to do so if asked. In all those circumstances, neither the House nor my hon. Friends would expect me to go into detail about the dispute, nor attempt to answer particular points about the substance of the negotiations.

I shall deal with two aspects of the position at Grain. First, with my hon. Friend, I deplore the violence, the intimidation, the excessive picketing and the threats of secondary action that have occurred in this and earlier disputes at Grain. That is the unacceptable face of trade unionism, which is recognised widely by those who work on the site. Some of it is currently unlawful, and some will be unlawful if it is repeated after the Employment Bill has been enacted.

I do not agree entirely with my hon. Friend that the dispute is related to the closed shop. What has happened at Grain is an example of the understanding, realism and change of attitude that is part of the Government's policy. It is part of the reason why we put so much emphasis on the Employment Bill, which we need to change attitudes about that sort of trade union action if we are to revive our economy.

Secondly, my hon. Friend has sug-that the CEGB has used the current dispute as an excuse to close down a station it does not now really need. As I understand the position, if the dispute had not occurred, the CEGB would still have been pressing forward to obtain the earliest possible completion of the five units which were intended to make up the station. But, over the years, disputes and other delays, including very poor productivity, have held up work, and the board has been obliged to reconsider its attitude to the completion of that station in a period of very high oil prices.

The present position is that one unit is complete and operating. As a result of reconsideration by the board, work on two units, Nos. 4 and 5, is suspended. The future of these is a matter for the board. I am advised that a number of options are being evaluated, but no final decision has been taken. Work on units Nos. 1 and 3 was also suspended as a result of the dispute, but the suspension was lifted in May when lagging work on the Grain site was resumed. It is the board's objective to get the lagging on these units completed. I must emphasise that the station's future was in the first place thrown open to doubt by the difficulty in getting it finished rather than by second thoughts on the part of the board.

As we have heard, Grain is four years behind schedule, and there have been serious delays at other power station sites. These delays are extremely costly and it is the public who pay the price—not so much as taxpayers, as my hon. Friend suggested, but as consumers of electricity. I can confirm that the figure of £433 million was correct up to December. The latest figure is £450 million as at the end of March.

The CEGB recognises the need to improve performance on its construction sites and it is taking a number of steps to this end. It is developing a strategy at Drax which involves co-operative action by site contractors as a contractual obligation to create consistency of employment conditions and payments on the site. It is also a leading supporter of a single agreement and national joint council covering the engineering construction industry.

It is vitally important that such initiatives succeed. The future well-being of the economy depends on the completion of large engineering projects to cost and on time ; multi-national clients could and will go elsewhere to make their investment if that is not done. And in the longer term our energy supplies here at home, and in particular the Government's nuclear programme, depend on success in engineering construction.

Delays on large engineering construction sites are not confined to power stations. Chemical plants, oil refineries and others are affected. The problem has been the subject of several major reports. They have concluded that the problems are caused by a combination of factors—as my hon. Friend rightly suggested, the finger cannot be pointed in any one direction—including inadequate preparation at the design stage, delays in supply of materials at the work place, industrial relations, problems on site and the prospect of lay-offs on completion of a project.

All these questions are being pursued on an industry-wide basis by the economic development committee—the little Neddy—for the engineering construction industry.

If the causes are being being pursued—I recognise that it will cover a wide range of different sites under construction—will my hon. Friend consider whether a single cause is the closed shop at each of them? That would be an interesting part of his analysis.

I give my hon. Friend the undertaking that we will look at the matter, but there is a great variety of industrial practices on all these sites.

The CEGB is among the clients who sit on this committee along with representatives of the employers and trade unions involved.

My right hon. Friend the Secretary of State for Employment has carried on with a remit given to his predecessors by the National Economic Development Council to see whether he could assist the parties to develop and implement proposals to reduce delays on engineering contraction sites. He and I have met the parties on many occasions in the past year, and continue to lend what help we can to their efforts to produce a single agreement and a national joint council for the engineering construction industry.

Too many deadlines have been missed for me to make predictions, but I believe that there is a good chance of serious negotiations on a new agreement taking place in the next few months.

To some extent, the dispute at Grain has given added impetus to the negotiations for a new agreement for the industry as a whole. It has brought home to everyone the necessity for arrangements which bring some order and control to the chaotic earnings and industrial relations problems on large sites. Such arrangements are not something that Ministers can impose on industry, but they are something that we can help to promote and encourage. That we do, and I am pleased that the CEGB and the TUC feel the same way.

My hon. Friend posed the question of the length of time it takes to train laggers. I think the point he makes reinforces the determination of the Government to back the MSC's endeavours to see that in all trades and jobs, training is related not to time served but to standards achieved. Of course, the time taken to achieve particular standards will vary from trade to trade and individual to individual. But it is the way forward to a more flexible responsive use of talent which will be increasingly needed in the coming decades.

To conclude, my involvement in discussions about a new agreement for the engineering construction industry took me to the Isle of Grain just over a year ago. I met some CEGB officials, contractors, trade union leaders and shop stewards. I was impressed by the volume of support for a new agreement and new working arrangements expressed by all the groups. There was a wide understanding of the implications of persistent delays on power station construction and of the destabilising effect of substantial differences in earnings which were felt to reflect neither skill nor effort. To me, that seems to be what the present dispute is about. It also underlines why the endeavours we are making to get new working arrangements for the industry are so critical. I can assure my hon. Friend that we are doing all in our power to support them.

I thank my hon. Friend the Member for Gravesend for the opportunity he has afforded us for this debate. I hope that I have answered his questions. I shall look into the matter put to me by my hon. Friend the Member for Rochester and Chatham.

I repeat what I said at the beginning of my remarks. We all hope to see a settlement of the dispute in the next few weeks.

Question put and agreed to.

Adjourned accordingly at five minutes to Three o'clock.