"Capitalising on Low Cost Manufacturing Environments"

Workers' Daily Internet Edition : Article Index :

US Electronics Multinational Viasystems makes 875 redundant:
"Capitalising on Low Cost Manufacturing Environments"

Conference Opposes Private Sector Involvement in Public Services

Education White Paper:
Opposition to Greater Role for Private Sector Is Not Defence of Vested Interests

NHS Criticised over Temporary Nurses

International News:
Militant Demonstrations at WCAR Demand Solutions to the Problems of Racism

The large US electronics multinational Viasystems which manufactures circuit boards in a sudden move on Monday turned workers away after they returned from the holiday shutdown. The company is to make 550 workers redundant by closing the Longbenton factory and is also making 325 redundant at the remaining South Shields plant with 875 redundancies overall. Viasystems has 34 manufacturing facilities in nine countries on three continents. The company boasts on their website that their facilities are "strategically located in the United States, Canada, Mexico, the United Kingdom, Ireland, the Netherlands, France, Italy, and China, capitalising on the low-cost manufacturing environments which better serve the needs of our customers". Many of the workers at the Longbenton factory have already been forced to relocate when Viasystems closed its Galashiels and Selkirk plants axing 1,000 jobs in 1998. "Capitalising" on the "low cost environment", Viasystems received £24 million from the government in grants over five years when it located its factories on Tyneside.

Angry workers have rightly accused the company of planning to shut up shop on Tyneside and move elsewhere as the terms of the government grant run out. Reports from three years ago show that the Borders economy was devastated after the circuit board producer pulled out of the area. The Scottish National Party MSP for the region, Christine Grahame, said at the time that the move had cost the local economy £21 million a year and she demanded that the Scottish Parliament investigate the company's actions. She said: "I believe one of the main reasons the company initiated the closure and subsequent transfer of machines was because the Tyneside plant had received a £24m grant from the Government. There was no equivalent offer made to the Scottish operation. The main conditions attached to the grant award to the Tyneside factory expire early next year. Then Viasystems will be free to close their operations in the North-East and transfer production to its plants in Shanghai."

Commenting on the closure David Milliband, newly elected MP for South Shields, could only speak about the job losses in his own constituency and that it was a "bad day for South Shields". But such issues concern all workers, who are entitled to ask: how much worse can it get? It is an exposure of the whole policy of New Labour that is further opening up the region and the country to the global economy and inward investment and the inherent and deep economic crisis that this system is causing. This is bringing to the national economy a loss of jobs, loss of job security, and serious damage.

For the workers the only way out of this crisis to start to take up the task of building the Workers' Opposition, which has the perspective of putting an end to the block that is being placed on building a balanced and independent economy and in which the rights and interests of the producers are paramount. The global monopolies should be stopped from taking more out of the economy than is put in and the economy developed to meet the needs of the people of the region and society as a whole.

On Tuesday, the Northern Regional TUC held a one-day Conference in Chester-le-Street entitled "Supporting Our Public Services". Several hundred delegates attended the conference, which was chaired by Gill Hale, Chair of the Northern Regional TUC. The conference was addressed by union leaders Malcolm Wing, UNISON, Kevin Curran, GMB, Roger Spiller, MSF, and Jack Dromey, TGWU. David Price, a fellow at University College London Health Policy & Health service research Unit and of the University of Northumbria, gave a well-received contribution to the conference.

Among other things David Price explained that public private partnerships in public services has eroded what he called the universality in meeting people's needs. He said that the government had replaced this with "subsidy targeting" for the worse off with the rest obtaining their services through the market. He warned the delegates that a new accommodation between the government and the high echelons of the TUC was being brought about. He said that the trade unions had accepted the government case that public finance and funding is a technical issue about "efficiency" and not about politics. The Labour government, he said, is insisting that they speak increasingly like shareholders at board meetings. New Labour presents the reforms as non-ideological, what works, and PFI is presented as "efficient capital procurement". But he pointed out that this just happens to be what the World Trade Organisation (WTO) recommends. He said that the instructions of the WTO are that when seeking to reform the public sector the biggest obstacle for governments is domestic opposition and the best way to circumvent that opposition is to paint the whole issue as technical and not as political.

He went on to say that public sector providers like Hospital Trusts have to pay a 6% return on capital. This is the only statutory duty of the Trust and the Chief Executive. It is not to look after the sick. He pointed out that New Labour is extending this and has changed the way funding is provided from funding health care needs to payments for services rendered. The next step, he said, in New Labour's "modernisation" is to attach the subsidies not to an area of services but to individual service users so that subsidies can be switched from supporting the public services of an area to supporting the purchase of some services in an area. This is all about giving the private provider a bigger role, he said, but these measures bring in huge extra costs. He said that the cost of Worcester PFI escalated from £49 million to £108 million. This caused a serious financial crisis in the local health service and they tried to meet that crisis by cutting beds by 28% and because that was insufficient they closed Kidderminster Hospital. He said the new hospital has at least 32% fewer ancillary workers and 70% fewer nurses. At Carlisle, cost doubled during PFI procurement of the new hospital to £70 million. These costs required bed cuts of 15% he said. He said that the new PFI hospitals are smaller and more expensive than the larger hospitals they replaced. The proportion that the hospital has to devote out of its annual budget has gone from around 8% to around 19% under PFI.

David Price went on to point out that the government had ruled that intermediate care after as little as two weeks could be charged. He pointed out that the government intends to use the mechanism of subsidies that are triggered when the user puts in their own money as the model that the government will transfer from "individual learning accounts", stakeholder pensions and so on. He said the scale of what is happening is extraordinary. In 1977, outsourcing of public services to the private sector accounted for 28% of total expenditure but by 1999 that had reached 57%. David Price concluded that this "Third Way" was not just a concoction of New Labour but that it was an international policy of the WTO, World Bank and the EU. He said that he was shocked to see Clare Short and other government Ministers attaching these same liberalisation requirements for the privatisation of public services to the conditions of debt relief to the poorest countries in Africa.

In the group discussions that followed the plenary session, delegates raised many examples of the situation in their areas and the need to build the opposition. Delegates expressed the need to develop this movement by involving wide sections of the people. A conference document is to be produced highlighting the discussions.

The government has published its education White Paper, "Schools: achieving success". It emphasises the greater role to be given to private firms in state secondary schools, including the tendering out of new schools to firms or the voluntary sector, and reserve powers allowing ministers to compel local authorities to hand failing schools over to private sector management. The new proposals, originally to be published in July and viewed by some as "diluted", were unveiled by Education Secretary Estelle Morris yesterday.

Teachers and local authorities are concerned over the increased role given to the private sector .Specialist schools are expected to increase significantly and the new schools will be able to select up to 10 per cent of pupils on the basis of "aptitude". The introduction of a predominantly "vocational" education for 14-year olds who choose it has been postponed for another two to three years.

Writing in the Guardian, education minister Margaret Hodge argues that wholesale school privatisation is "inimical to our core values". She writes: "Old Labour ideologues should stop dressing up defence of vested interest as vital principle; New Labour managerialists should stop pretending that financial services bosses know all the answers about good customer services."

This can be construed as a "Third Way" interpretation of the struggle which teachers, parents and the community are waging against handing over the managing, financing and control of education to the private sector, and against education being reduced to one of "vocational" training on the one hand, and the selection by "aptitude" for admission to the meritocracy on the other. However, it should not be overlooked that the main thrust of the government's criticism is not against the "managerialists" but against those who are opposed to the direction that the government is taking education as an integral part of the anti-social offensive and the dismantling of society. The defence of the right of all to education cannot be considered as defence of vested interests. It is the principle which lies at the heart of the struggle to safeguard the future of education.

The NHS spent £810 million on temporary nurses last year alone, the Audit Commission revealed on September 5. Highlighting the escalating costs of agency and bank nurses, the commission also suggests that patients lives could be being put at risk after it was found that pre-employment and occupational health checks were often not carried out on temporary NHS staff.

Throughout the UN World Conference Against Racism (WCAR) taking place in Durban, South Africa from August 31 to September 7, mass rallies, marches and other actions have been taking place daily. Each day, as the gangster behaviour and arrogant dictate of the US and European powers become more pronounced, the workers, women and youth of Durban, along with social and political activists from across Africa and around the world, continue to give militant expression to their demands that the Conference serve the interests of the peoples of the world in solving the problems of racism. Throughout the week, the people continue to show that no amount of disinformation on the part of governments and the monopoly-controlled media can stop the growing international support for the just cause of the Palestinian people and all the peoples fighting in defence of their rights the world over.

On August 31, the opening day of the WCAR, a massive march and rally was held in Durban. Thousands of workers, women and youth of Durban were joined by participants in the WCAR and the parallel NGO Forum as they assembled in the morning at Natal Technical College. As they marched some 8 kilometres for over three hours to the International Convention Centre, site of the WCAR, their numbers swelled to the tens of thousands.

Throughout the march and rally, signs, banners, chants and speeches demanded official apologies and redress for the crimes of colonialism and the slave trade, particularly denouncing the past and present crimes of the US imperialists and the Israeli Zionists in their service. At the main rally, speaker after speaker targeted the US and other imperialist powers for their arrogant attempts to dictate the agenda of the WCAR.

The march was organised by the Durban Social Forum, an umbrella group including the Landless People's Movement, the National Land Committee, South Africa's largest labour union COSATSU, the National Consultative Forum on Palestine and dozens of other South African political, social and community organisations. The demonstration took place in the midst of a two-day general strike called by COSATSU involving millions of workers across the country.

Many of Durban's homeless as well as the rural landless took part in the march which also put forward the demands of the people of South Africa that their government take up for solution the continuing poverty and landless problem in the country. At a press conference earlier in the week, march organisers pointed out that the landlessness and homelessness was the legacy of the racist and segregationist apartheid regime and typified the suffering of the peoples of the world due to the continuing economic domination by the big powers in the world. The demonstration, they said, reflected the unity and determination of the people of South Africa to reject the neo-liberal policies being imposed on their country and all the peoples of the world.

Throughout the demonstrations, the determination of the peoples to not be diverted from their cause is being clearly shown. As the peoples step up their fight to affirm their rights and the rights of their collectives, those governments which are intervening in Durban with arrogant dictate, gangster threats and self-serving disinformation to block the aspirations of the people are only revealing more sharply their true colours as forces for retrogression. Regardless of the final outcome of the WCAR, they have already deepened their own credibility crisis.