Job Losses As Petrochemical Plant To Close

The owner of the Grangemouth petrochemical plant is to close the operation permanently and keep shut, for now, its major oil refinery amid a continuing pay dispute.

The move threatens up to 800 jobs at the petrochemicals business, which makes products used in everyday items such as packaging and plastic bags, unless it can be sold.

The Grangemouth site's owner Ineos said while it would retain the refinery, which produces 80% of Scotland's petrol and diesel, production would remain shut down until the threat of industrial action was removed.

The Government said there was no current threat of fuel shortages in Scotland because of contingency planning.

Workers were given news of the closure at a meeting with Ineos petrochemicals chairman Calum MacLean following the passing of a deadline on a survival plan which asked all Grangemouth staff to accept changes to pensions and other terms and conditions.

The Unite union said around 680 of the site's total 1,370-strong workforce rejected the proposals, which included a pay freeze for 2014-16, removal of a bonus up to 2016, a reduced shift allowance and ending of the final salary pension scheme.

Following the meeting with staff, one worker who did not want to be named, said: "I feel sick. It's gone."

The worker, who appeared close to tears at points, told Sky News he could only listen to about 10 minutes of the meeting, before he felt he had to leave.

"There's no livelihoods left and we don't even know if we're going to get redundancy out of it. I hope they're happy with themselves," he said.

Unite has accused the company's owner Jim Ratcliffe of playing "Russian roulette" with the future of Grangemouth, the biggest industrial site in Scotland, and said it would back any efforts by the Scottish Government to find a new buyer for the petrochemical complex.

In a statement, Ineos blamed the union's opposition to its survival plan for the decision to close the petrochemical plant - saying shareholders could no longer fund it.

Mr MacLean said: "This is a hugely sad day for everyone at Grangemouth. We have tried our hardest to convince employees of the need for change but unsuccessfully.

"There was only ever going to be one outcome to this story if nothing changed and we continued to lose money.

"We still struggle to comprehend what has happened here. The employees were offered a chance to secure substantial new investment in the company, preserve their jobs and keep their salaries. Sadly this will no longer be the case."

The company added: "As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week."

Energy Secretary Ed Davey said: "I am saddened to hear of Ineos' plans to place the petrochemicals business into administration, particularly because of the impact it will have on the workforce and local community.

"While respecting Ineos' right to make this decision, it is regrettable that both parties have not managed to negotiate a fair and equitable settlement that delivers a viable business model for the plant.

"Even at this late stage, I urge Ineos to continue dialogue with the workforce and Government will offer help and support with this.

"Ineos have informed us that the refinery will stay open and the management wish to restart full operations as soon as possible.

"We stand ready to help with discussions between the management and the union to ensure this can happen.

"Fuel supplies continue to be delivered as usual and there is no current risk of disruption to supplies."

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