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Swinney tells Diageo: Scots won't accept social cost of 900 lost jobs

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Published Date: 13 July 2009
THE finance secretary has warned Diageo that the "social consequences" of its plans to shed hundreds of jobs are "not acceptable" to the people of Scotland.
John Swinney said his priority is to ensure the drinks giant's proposals to cut 900 posts by closing the Johnnie Walker bottling plant in Kilmarnock and a distillery at Port Dundas in Glasgow do not go ahead.

Mr Swinney will chair cross-party disc
ussions tomorrow aimed at saving the jobs, along with representatives from Scottish Enterprise, trade unions, and local authorities.

The Scottish Government has asked that the company make available the financial information behind its original decision, and has vowed to pursue an alternative business proposal.

Mr Swinney's comments came as Diageo's chief executive was accused of hypocrisy yesterday for continuing to sit as the European chairman of the International Business Leaders Forum, a body which promotes business as a means of providing "sustainable and equitable societies".

The proposals helmed by Paul Welsh – whose pension pot is valued at £8.2 million – would "destroy" the town of Kilmarnock by pressing ahead with the cuts scheme, one MSP said.

Speculation is also mounting over the company's ownership of the five-star Gleneagles Hotel in Perthshire, with suggestions it is close to agreeing a £250m sale of the property to part of the Dubai royal family.

Mr Swinney, who described Diageo's business proposal as "potentially devastating cuts," said: "Our priority is to ensure Diageo's proposals, which would have a serious impact on the Scotch whisky industry and Ayrshire economy in particular, are not implemented."

Backed by Scottish Enterprise, Glasgow City Council and East Ayrshire Council, he emphasised that Diageo must hold a "proper consultation".

He added: "Diageo workers can be assured that we are working flat out in our efforts to preserve the strong relationship between Kilmarnock and Port Dundas and the Scotch whisky industry.

"Tuesday's meeting will focus on bringing together the most cohesive arguments and package of initiatives possible.

"Diageo must realise that the social consequences of their financial proposals are not acceptable to the people of Scotland."

Scottish Secretary Jim Murphy will also raise the proposed closures this morning when he holds talks with Scottish Enterprise chairman Crawford Gillies.

Mr Murphy said: "When I met the chief executive of Diageo in London on Wednesday he assured me that they would consider any alternative proposals that emerge from Scottish Enterprise."

Diageo is said to be in advanced talks with the al-Tajir family over the sale of Gleneagles.

A spokesman for the al-Tajir family confirmed they had held talks in 2002 about buying the Perthshire hotel, but refused to comment on the latest rumours of negotiations.

Meanwhile, Formula One fans have been urged to sign an online petition opposing Diageo's plans. One of the firm's key brands, Johnnie Walker, is the sponsor of the McLaren Mercedes team, home of British driver Lewis Hamilton. Kilmarnock MSP Willie Coffey is urging fans to back the campaign. More than 8,000 have added their names so far.





Page 1 of 1

  • Last Updated: 12 July 2009 9:28 PM
  • Source: The Scotsman
  • Location: Edinburgh
  • Related Topics: Diageo , Scotsman Whisky
 
1

tartangladbach,

edinburgh 13/07/2009 01:16:46
i thought jim murphy had this all fixed? he was going to build a new factory?, himself i think? at weekends. thank goodness we don't have to depend on layers of goverment departments deciding the outcome spread over two countries, with a dying goverment in place only interested in self preservation with a looming general election and we can instantly respond with an offer or solution to the problem.
2

Electric Hermit,

13/07/2009 01:31:33
4
tartangladbach

"i thought jim murphy had this all fixed?"

Murphy needs to butt out. His self-important posturing will only undermine the efforts of John Swinney and Alex Salmond. Murphy and the Tory/BLP cabal bow and scrape before their corporate masters. What is needed is a tough approach such as Swinney is hinting at.

Paul Walsh and Diageo need to be slapped into place. Not mollycoddled with taxpayers' money.

3

Am Fògarrach,

13/07/2009 01:48:19
1 Malaclypse the Younger

You will probably be right, but at least Swinney is making the attempt, not just moaning and whining.

Did you happen to notice that "Mr Swinney's comments came as Diageo's chief executive was accused of hypocrisy yesterday for continuing to sit as the European chairman of the International Business Leaders Forum, a body which promotes business as a means of providing "sustainable and equitable societies".

You of course are against Scotland having a sustainable and equitable society of its own rather than being subsumed in the "equitable UK.

4

donald,

glasgow 13/07/2009 06:52:39
Still the Brit Nats blame the Powerless Scottish Government for London based decisions from Labour's capitalist chums.

More punching the air from Labour's numpty traitors.
5

Mercutio,

FALKIRK 13/07/2009 06:57:35
#7 Away and have a wee dram of Diageo's finest.
6

donald,

glasgow 13/07/2009 07:02:57
How much does the English Treasury make from Scotch again?

How much did Guinness make from being allowed to steal Scottish Distilleries and trashing Scots jobs? Compensation is long overdue. I stopped drinking their products in principle a long time ago.

I will raise a glass of my favourite malt to the Scottish Socialist Republic and an end to British Imperialism.
7

Itchy,

13/07/2009 08:03:25
#9"I will raise a glass of my favourite malt to the Scottish Socialist Republic "

Any socialist republic will be an absolute hell hole.
8

Phil C,

13/07/2009 08:12:14
#9 I will raise a glass of my favourite malt to the Scottish Democratic Republic and an end to British Imperialism.
9

john z,

edinburgh 13/07/2009 08:15:23
Luckily, there are many, excellent single malts made by independent distillers and not owned by Diageo, but you.

Diageo need a reality check. Here's a wee accountancy thing - What price do you put on good will. Is 20 million pounds a suitable return for p*ss*ng off the entire population of Scotland.

Any smart businessman knows that good will is literally worth its weight in gold.

The CEO of Diageo, needs to give it some thought.

Is he sure he wants to sell Gleneagles to the Dubai royal family??
10

john z,

edinburgh 13/07/2009 08:21:21
10,

We are just now seeing the truly wonderful nature of capitalism - failed banks being given money from taxpayers just so they can pay dividends to the shareholder fatcats.

Is socialism really any worse??

Either way, out of this wasteful english union, Scotland could set the agenda, and protect its own industries. It is just laughable is it not, that the board of Diageo, are being summoned to answer questions on the closure - but in London.

Yes, they are going to get quizzed by the english parliament - as if Westminster actually gives a flying f***.

Another union 'benefit'
11

The Strategist,

13/07/2009 09:07:19
So Murphy is to meet the Scottish Enterprise Chairman Crawford Gillies to discuss this. I won't be holding my breath.

Gillies told this newspaper that he's instructed an Edinburgh headhunter to look overseas for a replacement for the Scottish Enterprise Chief Exec who is leaving this year. So he obviously doesn't have much faith in or support for Scots either.
12

,

13/07/2009 09:17:21
Comment Removed By Administrator
Reason:
13

P Rayner.,

UK 13/07/2009 10:40:40
Whatever business decision the Company makes, vis its production in Kilmarnock, its extremely unlikely to be influenced by the ineffectual and posturing Swinney. In so far as the Company honours its contractual obligations to its workforce, or it seeks to re-employ, it must be free to do whatever it sees fit in the interests of the Company.
14

letmein,

paisley 13/07/2009 10:50:36
Just stop drinking their products and keep that idiot murphy out of things.
I mentioned las week that John Swinney would sort it.
Nova albion stay down south with your masters and give us peace.
PRayner, you seem to be in favour of all the people losing their jobs. What a dip stick.
15

drunken proffet,

Tassy 13/07/2009 10:54:32
Diego is a well regarded International company. Scotland is an area of the UK belonging to the London Establishment. Whatever Diego decides on, I would think that it is in the long run, for the best interests of Scotland. Just an observation from an expat on the outside looking in.
16

Itchy,

13/07/2009 11:41:52
"13 john z,edinburgh 13/07/2009 08:21:21
10,

We are just now seeing the truly wonderful nature of capitalism - failed banks being given money from taxpayers just so they can pay dividends to the shareholder fatcats.

Is socialism really any worse??"

Failed banks being propped up by the taxpayer is socialism.

You are linguistically and economically illiterate.

Is socialism worse? We can ask those who lived under Socialism in Stalin's Russia, Mao's China, Hitler's Germany etc.
17

,

13/07/2009 11:42:17
Comment Removed By Administrator
Reason:
18

Itchy,

13/07/2009 11:42:52
#13 BTW Independce could work.

Socialism, however, never has and never will.
19

Grumpy,

13/07/2009 11:52:57
Strange that other Diageo companies in Scotland are being so quiet. I would have thought that they would have scome out in support of their colleagues.

But for the Scottish public, the answer is simple - let The Scotsman publish a list of all Diageo products, and let us stop buying them - and I include the wholesalers, supermarkets, publicans, and joe public.
20

GONNYNODEATHAT,

Glasgow 13/07/2009 12:37:22
Swinney ~ "THE finance secretary has warned Diageo that the "social consequences" of its plans to shed hundreds of jobs are "not acceptable" to the people of Scotland" These companies ya dafty has no LOYALTY to you or anyone except Profit. Diageo does not give a blind hoot about social consequences. Are you daft Swinney or something !!
21

Proodence ,

North Queensferry 13/07/2009 13:06:34
22 Grumpy
"But for the Scottish public, the answer is simple - let The Scotsman publish a list of all Diageo products, and let us stop buying them"

And the effect on Diagio...nil! If it did, it would only result in the closure of a few distilleries.
Obviously daft as well as Grumpy, rather like the hapless Swinney really.
22

Fairfax,

13/07/2009 13:08:07
Grumpy (22): "let The Scotsman publish a list of all Diageo products"

Diageo publish this themselves:

http://www.diageo.com/en-row/Ourbrands/
23

Electric Hermit,

13/07/2009 13:39:19
Yet again we see that the Tory/BLP pack here have no interest whatever in addressing the issue of the threat to Scotland's whisky industry. Their sole purpose is to undermine and denigrate the Scottish government. Such irresponsible pettiness would be easily dismissed for the puerile nonsense it is but for the fact that it reflects the attitude of the politicians and parties that these clowns seek to put into power.

These people are supporting and voting for politicians who are declared enemies of their own government and who brazenly put partisan interests before the welfare of Scotland and its people.

What does that make them?

24

Alternative (High-Octane) Fuel Head,

Edinburgh 13/07/2009 14:53:15
If Swinney really cared about Scots' jobs, he would be pressing for the scrapping of the nazi state smoking ban that is decimating our leisure industry.
25

Jack fae Glasgow,

Govan 13/07/2009 15:07:13
EU protection is all thats needed. Taking a leaf from French and Italian Protectionism for some of their drinks and foodstuffs, lets follow suit. Have the EU declare that if Scotch isn't made in Scotland, Distilled in Scotland, Matured in Scotland and BOTTLED in Scotland - then it aint genuine Scotch Whisky. That should focus Diageos Board quite adequately I think!
26

Electric Hermit,

13/07/2009 15:14:55
27
Alternative (High-Octane) Fuel Head

"...nazi state..."

In case you were wondering why nobody takes you seriously, a large part of it must be down to inane comments such as this.

Actually, the leisure industry is doing quite well this year. There are many reasons for this. But clean air in pubs is surely one of them.

The days when you could force others to breathe your disgusting, toxic stench are gone forever. Live with it!

27

Electric Hermit,

13/07/2009 15:17:13
29
Jack fae Glasgow

Spot on! Except that such an appellation scheme would not need to be a matter of EU legislation. It should be the Scottish government that does this.

28

Yeah1,

13/07/2009 16:05:00
#28

There is no point arguing with Alternative (High-Octane) Fuel Head - he appears to believe he has a right to live in a country in which he is entitled to do whatever he wants, regardless of the consequences to anyone else.

He thinks he should be allowed to force others to breathe his cigarette smoke, and drive at whatever speed he wants, regardless of how many people he kills doing either.
29

Western Gael,

13/07/2009 17:00:12
More on GONNYNODEATHAT's comment:

Contrary to Mr. Swinney’s assertion that “Diageo must realise that the social consequences of their financial proposals are not acceptable to the people of Scotland,” the members of the Board of Directors of Diageo probably care more about company profitability than the social consequences of any decision they make, whether in Scotland or not. As for loyalty, they discharge that obligation every week in the workers' pay packets. Diageo’s sole responsibility as a corporation is to maintain the value of its common stock and any bearer bonds it has issued to share holders. The most direct way to maintain profitability in an economic downturn is to reduce expenses. If they can do so most efficiently by closing the bottling plant in Kilmarnock and distillery at Port Dundas then it would be best for the Finance Secretary to draw up plans for handling the consequences of that action, not whingeing about it in the press. And, regardless of Diageo’s assurance to Mr. Murphy, considering an alternative proposal from Scottish Enterprise is no pledge to accept it.
30

Electric Hermit,

13/07/2009 21:11:47
31
Western Gael

"Contrary to Mr. Swinney’s assertion that “Diageo must realise that the social consequences of their financial proposals are not acceptable to the people of Scotland,” the members of the Board of Directors of Diageo probably care more about company profitability..."

Diageo's Board of Directors are not the people of Scotland. When you learn the difference, you may have some sensible comment to make.

31

Electric Hermit,

13/07/2009 21:54:04
31
Western Gael

Your mindless support for the contention that companies may do whatever they wish regardless of the consequences is exactly the kind of "thinking" that caused the current economic crisis.


 

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