Quote samwire="samwire"is this the same 'remploy' that peter hain decided was 'simply not viable' back in 2007 and promptly shut almost 30 'factories' a year or so later? vote labour, screw the disabled!'"
He did? Have a read:
[url=http://www.publications.parliament.uk/pa/cm200708/cmhansrd/cm071129/debtext/71129-0006.htmHansard 29 November 2007[/url
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Remploy
12.15 pm
The Secretary of State for Work and Pensions (Mr. Peter Hain): I wish to make a statement on the modernisation of Remploy. Since Remploy was founded in 1945, it has played a central role in the lives of thousands of disabled men and women by providing supported employment for those who need it and, increasingly, by placing others in mainstream employment.
Both as a local MP and as a Minister, I have for the past 17 years worked closely with and supported Remploy and, as Secretary of State for Work and Pensions, Remploy workers will continue to have my full support. May I record the grateful thanks of the House for the diligence and commitment of my hon. Friend the Minister for Disabled People.
Of course, the world has developed dramatically since the end of the second world war, not least in how the aspirations and expectations of disabled people have changed, and changed for the better. The vast majority want jobs in mainstream employment, and that is the Government’s priority. That is why we extended the scope of the Disability Discrimination Act 1995. That is why we have been transforming the support that we give to disabled people, moving away from a system that abandons people to the margins to one that helps them to realise their potential.
That is why we spent £66 million last year on the Workstep programme to support 17,000 disabled people. That is why we spent £62 million on access to work, to help 24,000 people. These programmes are already helping disabled people to take their place in an inclusive society. That is why we are introducing the employment and support allowance, which will replace incapacity benefit next autumn. That is why we are extending pathways to work across the country by April next year, offering tailored support to help people on incapacity benefit back into work. And that is why last year, Remploy’s employment services division placed 5,000 disabled people in mainstream employment, for the first time outstripping the number employed by the factory network.
We have helped more disabled people into jobs than ever before. For example, since 2001 the new deal for disabled people has helped over 150,000 into work. None the less, there remains a vital role for supported employment, providing a chance to work for thousands of disabled people who might not otherwise be immediately ready for mainstream work. That has been a central part of Remploy’s work since it was founded, but increasingly, Remploy has struggled to fulfil this role effectively.
Low-wage, low-skill competition from countries like China and the EU accession states has put Remploy factories under enormous pressure. In turn, Remploy has failed to move adequately into higher-value, higher-skill work. Losses have spiralled, and Remploy’s ability to support disabled people has been put at risk. Change is therefore essential for Remploy’s 83 factories across the country, and the 5,000 people whom they employ.
Following the National Audit Office’s report in 2005 and the independent report by PricewaterhouseCoopers and Dr. Stephen Duckworth of Disability Matters last
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summer, Ministers asked Remploy to develop a new five-year restructuring plan. This was to modernise the business, avoid compulsory redundancy for Remploy’s disabled workers, support substantially larger numbers of disabled people into mainstream work, and stay within a funding envelope of a £555 million taxpayer subsidy over five years, to ensure that escalating costs do not put at risk funding for other Department for Work and Pensions programmes for disabled people.
The reality is that without modernisation Remploy deficits would obliterate our other programmes to help disabled people into mainstream work. With no change, in five years’ time Remploy would require £171 million a year on current trends. That would be £60 million over the £111 million funding envelope, which represents nearly the entire current annual Workstep budget.
In May 2007, Remploy made a proposal, for consultation with the trade unions, to close or merge 43 of the 83 Remploy factories. When I took over as Secretary of State a month later, however, it was clear that national and local management had not exhausted procurement opportunities to maintain the maximum number of Remploy sites. There was also a huge gulf between Remploy management and the trade unions, and the likelihood of destructive confrontation.
In August I therefore asked Roger Poole, a former assistant general secretary of Unison, to act as the independent chairman of fresh negotiations, and I want to record my thanks for the way in which he managed to achieve real dialogue and progress. Although there was no agreement on factory closures, there was significant common ground for the first time. There was agreement on the £555 million funding subsidy, on the quadrupling to 20,000 the number of disabled people Remploy would help into mainstream work, on significant cuts in management jobs and costs, on more efficient working practices, and on the vital importance of generating more public sector contracts—and, in consequence, the need for fewer factory closures.
In September I reaffirmed Government policy on Remploy: that everyone should do their utmost to get a negotiated outcome; that there would be no factory closures without ministerial agreement; and that all public authorities should be encouraged to take advantage of European procurement rules allowing contracts to be reserved for supported businesses. I also reaffirmed, as I do again today, that there would be no compulsory redundancies for Remploy’s disabled workers and that they would retain the protection of Remploy’s terms and conditions, including—uniquely for workers facing plant closures or transfers—their salaries and final salary pensions. Both workers and management now need certainty to end the insecurity and worry for Remploy employees and their families and to allow Remploy management to begin the radical changes that we all recognise are needed.
The final proposals that I am announcing today represent the best package for Remploy’s disabled employees in those difficult circumstances. Copies of the modernisation plan are available in the Vote Office, and a letter with agreed proposals to the trade unions has been deposited in the Library. There will be 15 fewer factory closures, with 55 factories remaining open and 11 merging—down from 32 closures to 17.
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The sales target for public procurement will increase to £461 million over five years, up from £298 million since the company’s proposals in May. That is a huge and challenging 130 per cent. increase over the current rate of sales of £200 million. There will be a total cost saving of £59 million from around 25 per cent. fewer managers, changes in working practices and reductions in non-wage costs.
Last week I had productive discussions with the leaders of the GMB, Unite and Community, joined by Remploy chairman Ian Russell, and I pay tribute to Ian Russell for his energy and commitment to get the best for Remploy workers. As a result, we have reached further agreements to protect Remploy’s future and its workers. New skills in public procurement will be brought in to ensure that its marketing and sales effort is targeted appropriately. Appropriate employment advice will be available to all disabled employees whose factories are closing. Remploy will provide a travel-to-work package wherever necessary, where employees transfer as a result of mergers. Furthermore, Remploy has been contacted by third parties interested in keeping some form of production or training at six of the sites due for closure—Lydney, Glasgow Hillington, St. Helens, Treforest, Ystradgynlais and Brynamman. At four other sites—Mansfield, Pinxton, Plymouth and York—there is the possibility of staff transfers to nearby plants, most of which are local authority-supported.
I know there will be disappointment that we are unable to keep even more factories open, but the reality is that it is simply not viable. For those sites, including those mentioned above, this is my message: if management, trade unions, MPs and others come up with a credible option involving a takeover or transfer, we will, of course, co-operate, and Remploy will help to facilitate. However, time is very short. The new funding envelope starts in four months’ time—from 1 April 2008.
We have managed to keep open 55 sites only on the basis of very stretching procurement targets and a tough forward plan. It will be up to everyone with an interest in Remploy—Government, management, trade unions, local MPs and other political representatives— to pull together to ensure that those factories meet their ambitious targets, otherwise they, too, could be put at risk.
The proposals that I have presented today are both realistic about the challenges facing Remploy and ambitious for the future. The plan makes some difficult choices, and many hon. Members wish that the circumstances were different, but we are where we are. What is now vital is that everyone concentrates their efforts on making the new Remploy a success. There will be a top-to-bottom restructuring and reskilling of Remploy. The plan will deliver a new beginning for Remploy requiring a radically new approach across the entire operation, which must include better management and better union relations. Last week, I agreed with union leaders that the modernisation and procurement plan will be properly monitored to ensure that it remains on course, so that Remploy can look to the future with a degree of confidence not enjoyed for some years—the people that it was set up to serve deserve no less. I commend this statement to the House.
Chris Grayling (Epsom and Ewell) (Con): I start by thanking the Secretary of State for giving me advance sight of the statement.[/i