Meeting of the Parliament

Meeting date: Tuesday, November 13, 2018

Official Report 1094KB pdf

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Texas Instruments

The final item of business is a members’ business debate on motion S5M-13551, in the name of Stuart McMillan, on Texas Instruments. The debate will be concluded without any question being put.

Motion debated,

That the Parliament expresses its concern at reports that the Texas Instruments semi-conductor plant in Greenock is scheduled to close in 2019; notes the effect that this closure could have on the current employees and Inverclyde economy; further notes that a total of 572 positions would be affected with 318 direct jobs, 127 indirect jobs and 127 induced jobs; acknowledges that the Texas Instruments task force, which includes Inverclyde Council, the Scottish Government, parliamentarians, councillors and various public agencies, was established after the announcement, with an initial remit of trying to find a buyer for the plant and to safeguard as many jobs as possible; suggests that all avenues to date have sadly fallen through, and notes calls on everyone involved to redouble their efforts to find a resolution to try and assist the workforce, as well as the Inverclyde economy.

16:51  

I thank every member who signed the motion to allow the debate to take place. I also thank the whips for allocating the time to debate the motion.

I will begin with a short history of the Texas Instruments situation, before going on to explore other aspects of the business and Inverclyde.

On 27 January 2016, TI announced that it was going to close the Greenock plant, with the loss of more than 300 jobs. That came as a blow to my area, which is one that has not been without economic challenges since the decline of the majority of the shipyards, heavy engineering and sugar manufacturing, as well as the huge reduction in the information technology sector in recent times. The local site manufactures semiconductors, but it also had a design centre. The 25 posts in the design centre were made redundant in April and May 2016.

The population of Inverclyde is robust—we have had to be, given that the TI announcement followed the trend of other industries. The vast majority of the TI jobs are technical and highly skilled and their financial contribution to the local economy is vast. The workers deliver results and the Greenock facility is productive.

TI took its decision purely for business reasons. The Greenock site is one of the smallest in its portfolio and, therefore, TI decided to consolidate its business by closing the Greenock site and transferring the work to the United States of America, Japan and Germany. TI is the second biggest manufacturer of semiconductors in the world, so it has the scale and size to enable it to make that type of decision. I am grateful that TI provided a long lead-in time to the closure and extended the closure date to 2019, which has provided valuable additional time to try to find a buyer.

The Texas Instruments task force was established by Inverclyde Council and consists of councillors, parliamentarians, Scottish Government ministers, Scottish Office representatives, public agency representatives and the site director of Texas Instruments. It was genuinely a team Inverclyde approach. The primary goal of the TI task force was—and still is—to find a buyer to maintain the site. If that proved unachievable, then the task force would focus its efforts on providing the best possible outcomes for the workforce and the local community. Government agency staff have visited the plant to talk to the workforce to make people aware of services available to them. I thank TI for its co-operation in that regard.

TI contracted ATREG Inc to help sell the site but, although some companies came forward, it unfortunately amounted to nothing. Earlier this year, the joint statement by Inverclyde Council leader, Stephen McCabe, and Paul Wheelhouse MSP, the then Minister for Business, Innovation and Energy, indicated the past efforts and dialogue with potential buyers that had been undertaken and stated that one deal was still on the table. We have been informed that discussions are continuing, which I am sure will be welcomed by everyone with a stake in the outcome for the workforce and the local economy.

The TI task force has provided a forum to discuss the challenges and possible obstacles facing a successful outcome for the plant and the excellent workforce. I want to put two things on the record. First, I thank everyone on the task force for the collegiate manner in which they have worked. Secondly, but most importantly, I thank the workforce. With the threat of redundancy hanging over their heads, they continue to perform, deliver and contribute to the highest possible standards. They are the consummate professionals, and when TI leaves the area, its loss will be someone else’s gain, whether they are from the same or another industry.

I hope that that summary helps the Parliament to appreciate the efforts that not only have been under way, but continue.

As I said, the 300-plus workforce and what they contribute to my area is hugely important. If it becomes a necessity, they have transferable skills, but maintaining their quality of life by living and working in Inverclyde is important for them and our area.

I do not doubt for one minute that anything and everything that can be done is being done. My message to Texas Instruments, any potential buyer, the Scottish Government, its agencies and to Inverclyde Council is very simple: do not leave any stone unturned to get a deal.

If there is a deal, TI would be able to leave the area knowing that a positive legacy is the outcome. TI will be aware that that has not always been the case locally, so it can show that it is trying to be responsible. Any potential buyer would be getting a first-class, dedicated and highly motivated workforce. The fact that the workforce has done the work every day for years—and that their work has continued after the closure announcement—proves that it is a credit. If the staff can still deliver under the stresses that they are feeling, just think what they could do with job security. The Scottish Government would have an area that is not being hit with a major economic shock and income tax receipts would continue, rather than none being received. Inverclyde Council would not have to worry about an increased number of people leaving the area, adding to the historical population decline and the economic aftershock that that would bring. It is in everyone’s interests that a deal is done.

Some of the challenges that we face include population decline and the claimant count. Our population is down to just under 80,000 when it was once more than 110,000. Recent National Records of Scotland population figures and projections highlight a stark message. Between 1997 and 2017, Inverclyde’s population has decreased by 8.9 per cent, while Scotland’s population has increased by 6.7 per cent. During that period, the 25 to 34 age group has decreased by 28.6 per cent and the 75-plus age group has increased by 20.9 per cent. Between 2016 and 2026, it is projected that Inverclyde’s population will decrease by 3.8 per cent, while Scotland’s population will increase by 3.2 per cent. Between 2016 and 2026, the 16 to 24 age group will decrease by 13.2 per cent, but the 75-plus group will increase by 20.8 per cent. Our claimant count rate, based on the Office for National Statistics figures for September 2018, stands at 5.4 per cent, which is 2,670 people.

With most of the heavy industry gone, we have our challenges, but there are many positives, too. Shipbuilding remains in Port Glasgow with Ferguson Marine, thanks to the support of the Scottish Government. I am immensely proud of its action. We also have ship repair in Greenock at Dales Marine Services. We are the home of the national ferry company with CalMac Ferries in Gourock. We are the recreational marine capital of Scotland, with an increasing level of marine-based activities, including more than 60 cruise ships docking in Greenock this year. That number is expected to increase hugely next year. The new George Wyllie museum, which will be incorporated into the new docking area for cruise ships, will be opening as part of one of the city deal projects. Those are just some of the many wonderful examples as to why Inverclyde should be a destination of choice and a location for investment.

Inverclyde is my home. I grew up there and I live there, and I am immensely proud of my area. We, just like every other part of Scotland or anywhere else across the globe, have our challenges, but we also have our opportunities. We are no different from anywhere else.

I do not want the workforce of TI to be added to the claimant count figures. I want them to continue producing high-quality, high-value products. That would enhance my community and Inverclyde’s economy and reputation. The TI workforce has consistently delivered. Those people have perseverance and hope and I genuinely hope that we can give them the best Christmas present that they could ever wish for—a deal to secure their jobs for the long term.

16:59  

I thank Stuart McMillan for his impassioned speech and for bringing the debate to the chamber. It is an excellent use of the limited time that Parliament has to discuss this important topic.

It is such an important matter because, as Mr McMillan said, it greatly affects not just those who work on site, but their families and the wider economy. Like him, I grew up in Greenock, so I am fully aware of the changes that the town has gone through as some of the big employers have come and gone over the years. The effect of that on the town has been substantial. Sadly, Texas Instruments is another one of those cases.

The task force was set up in 2016 to bring together the council, the Government, some Government agencies such as Scottish Enterprise and the business itself, as well as local politicians, and get round the table to have some frank and honest discussions about the situation. There have been many meetings of the task force and I have tried to attend as many as I can, with the exception of a few absences due to diary clashes. I have always found those meetings to be constructive and open.

I would like to pay tribute to the Texas Instrument task force chair, councillor Stephen McCabe, for the work and effort that he has put in. There has been acceptance that, unless we are collegiate and sit around a table to work together as politicians and agencies, the task force will never achieve anything. I can say honestly that the task force has worked tirelessly to look at and explore all avenues, right up to this point.

To be fair, the Government has done the same. Their agencies have participated in the meetings and they have gone out to the wider market, both in Scotland and overseas, to see what buyers might be out there and there have been many instances of expressions of interest. Some of those companies may have been tyre kicking—looking for an opportunity for a site—and many have come and gone. It is disappointing that we have got to the stage that we have.

Greenock, and Inverclyde in general, has been a resilient and robust part of Scotland. Members of my family worked for decades, until their retirement, in these iconic industries and in some of the companies that have come and gone, such as IBM and National Semiconductor. When they closed their doors it left a legacy in the town. This closure would do so too. I share Mr McMillan’s values in this regard: we do not want these people simply to be more statistics or to be joining the queue of benefits claimants.

We need to look at what happens next. There are only a few potential options. This is the last chance saloon, as we call it, to find a buyer. As the motion says, we should redouble all efforts to do so.

Those who want to use this opportunity to retire should be helped to do so and not judged. Many people have their reasons for doing that and I understand them. However, there are many who wish to continue in employment and that brings me on to another issue: what do we do around retraining and re-employability?

Last Friday, I went to West College Scotland in Paisley which has a campus in Greenock that used to be the old James Watt College. Many people will know it. One of the conversations that I had with the new principal there, who has just recently taken up office, was about how we can use further education facilities such as the college to help with adult retraining and re-employability.

There really is an issue for people who find themselves made redundant at a certain time of life, when it is too early to retire and they want to continue to work, but they struggle, after decades in a particular environment, to adapt to the new digital industries that seem to be coming forward.

We have to have a conversation about how we help such people to retrain, through practical training and through academic study, so that they can take up new opportunities. I know that the partnership action for continuing employment team is working with many people on the site and I hope that it will continue to do so.

In the short time that I have left before I must close, let me say that the TI site is a great site and I struggle to understand why no buyer has been forthcoming. I hope that there is still an opportunity in that regard, but if no buyer comes forward, the people who want to continue in the workplace must be given all the support that Governments and agencies, at every level, can provide.

As Stuart McMillan said, Inverclyde is a great place to live and work. If the plant closes, I hope that the people who work there will at least be able to move into the next stages of their careers. I hope that all politicians, at local level and in the Scottish Parliament, will do everything that they can to assist the workforce.

17:04  

I welcome tonight’s debate, which has been secured by Stuart McMillan. I support the motion on Texas Instruments, because it must be a priority for all of us to protect and create quality jobs in our communities. I agree with Mr McMillan about the plant’s importance—indeed, it would be difficult to overstate it—to the Greenock community and to Inverclyde as a whole.

In an age in which global competition has seen reliable, productive, high-value industrial jobs move elsewhere, the plant has continued to give skilled workers in Inverclyde the opportunity to sustain a valuable and profitable trade. Just as hundreds of people benefit directly from such highly skilled industrial work, hundreds more enjoy the indirect employment that is supported by the presence of Texas Instruments. Thousands benefit from the injection of millions of pounds into the Inverclyde and west of Scotland economy. It is estimated that, in total, the closure of the factory would mean a loss of 572 direct and indirect jobs and of £32.2 million in gross value added.

As others have said, we cannot allow Texas Instruments to withdraw from Inverclyde without a viable alternative emerging. I join other members in commending the work of the Texas Instruments task force, which has worked hard to find such an alternative. By working together to find a way forward, the council-led task force, with other agencies and the business community in the west of Scotland, has exemplified how the public and private sectors can co-operate to promote the economic interests of a community. I commend everyone who has been involved, but particularly Councillor Stephen McCabe and his Inverclyde Council officers for their leadership, as well as the workforce for the commitment and resilience that they have shown in the face of adversity.

The truth is that the factory’s story is not just another one about the stark realities of global competition. The potential loss of such highly skilled industrial jobs is not a sign of the times, nor the result of modernity. The truth is that the plant was profitable—and continues to be so. In the 2017-18 fiscal year, it generated profits of upwards of £3 million.

The sharp decline in silicon glen and the erosion of our electronics industry over the years have been dramatic, but that does not mean that we do not have options now. We do not have to just accept the loss of what remains of our electronics industry in Inverclyde. I agree with what Stuart McMillan has said, in that everything that can be done should continue to be done to protect this important asset. For the past two and a half years, members of the task force and I have said that a buyer can—and must—be found. The plant can still have a long-term future—a future that I hope can be confirmed soon. In pursuing a viable buyer for the plant who can continue to support the jobs, the industry and electronic innovation in the future, we commit ourselves again to building the robust economy that we can achieve and which our people deserve.

17:08  

I, too, express my thanks to Stuart McMillan for bringing to the chamber this important motion, which I support.

I welcome the opportunity to speak about Texas Instruments. The semiconductor plant is an important part of Scottish industry, so its upcoming scheduled closure is of great concern. The closure has the potential to affect not just Greenock and the Inverclyde area, but the worth of Scotland’s industry nationwide.

I echo the points made by my colleague Jamie Greene. I hope that, through the debate, we can raise awareness of the issue and strengthen our motivation to keep fighting for the workforce at Texas Instruments in Greenock. Those highly skilled people deserve to have no stone unturned in our aim to ensure that they have continued employment.

As has been referred to, the scheduled closure of the Greenock Texas Instruments plant in 2019 was announced almost three years ago. It is no mistake to say that the loss of the plant would be a severe blow to the Inverclyde economy and community, and that its workers are an asset to the industry.

The potential loss of Texas Instruments will have a worrying impact. First and foremost, its closure will affect 550 positions, and 318 direct jobs are expected to be lost. What does that mean for the area? Without those jobs, families in the area might feel that they must move elsewhere in search of more concrete employment. That will alter the face of the community and reduce options for incoming businesses and industries to come to Inverclyde.

The closure of Texas Instruments might also result in the loss of healthy competition across the industry in Scotland. The potential financial loss could be high: our economy could lose more than £32 million.

To be clear, this is not just a local problem. Texas Instruments has been of enormous financial benefit to Scotland’s economy. To keep that benefit going, we must safeguard it. I am thankful for the work that has been done by the Texas Instruments task force, which I am pleased to be associated with. The task force is an on-going collaboration between Inverclyde Council, the United Kingdom Government and the Scottish Government, as well as councillors, parliamentarians and multiple public agencies.

Since the closure was announced, our aim has been to protect the employees and to ensure a long-lasting and secure future for the plant in Greenock. As expected, that has been a challenge. For such a niche and specialist industry, finding a buyer for the plant has proved difficult. So far, our efforts have not given us the answer that we hoped for, but with each new possible opportunity, the task force remains hopeful of success, even with on-going negotiations. I am keeping my fingers crossed.

I hope that the efforts made by the task force will continue to be supported from all corners. Only with full support can all avenues be explored in depth. I know that the task force is committed to protecting the skills base that we have on our doorstep, and to using it as much as possible.

Ensuring long-term stability will open doors for the next generation of the community. For that reason, it is essential that we continue to include semiconductor science as part of our high school curriculum. That will encourage young people to direct their sights and their skills at the future of the industry. I hope that our teenagers will have the opportunity to put the skill set that they can gain to practical use in real-life situations, and I hope the Greenock plant is here to provide them.

I echo the call to continue agency-wide co-operation in our efforts to protect the Greenock workforce and support the Government’s efforts. We need to assess our options and every possible solution to keep the momentum going. The Greenock semiconductor plant is part of a global industry and is of much value to the surrounding community, as well as to our economy. In recognition of that, we must further our efforts and maintain our enthusiasm in order to secure the plant’s future for the sake of the employees and their community.

17:12  

I thank Stuart McMillan for lodging the motion and securing the debate. As Jamie Greene said, Stuart McMillan spoke with the passion that he always expresses when he is talking about his home area and, in particular, his efforts with the Texas Instruments task force.

I also welcome other members’ contributions. We often have debates in which we speak with one voice—that is particularly the case with members’ business debates, and quite rightly so tonight. We are all of the same mind. We are all here because we want to secure a positive outcome for the Texas Instruments site and, above all, for its workforce.

Many points have been well made. Stuart McMillan reminded us of some of the history of his home town, which, in line with most of the west of Scotland, has sadly seen some industrial decline during the past few decades. He spoke about Greenock’s shipbuilding heritage and the sugar industry that was once the town’s hallmark. In a later wave of industries, we saw Greenock and Inverclyde establish themselves as a hub for the technology sector, which has also seen something of a decline, with Texas Instruments being the last remaining big employer in that sector. We want to do everything that we can to retain that expertise locally.

We are moving closer towards the plant’s proposed closure in June 2019, so it is absolutely right that we have the debate tonight.

The loss of more than 300 jobs at the TI site would be an enormous blow to the economy. Texas Instruments has made a significant contribution to Inverclyde’s labour market and economy by providing a large number of high-value jobs. No area in Scotland can afford to lose that number of jobs, but I am acutely aware of the wider socioeconomic context that Inverclyde is operating in and the depopulation issues that Stuart McMillan ably set out. That is what we need to focus on.

Scottish Enterprise produced a report that assessed the economic impact of the company’s closure. In that regard, Neil Bibby was correct to say that this is not just about the jobs at that site alone. If we include the jobs supported by the site’s supply chain and the impact of falling household expenditure, Scottish Enterprise’s assessment suggests that 570 jobs could be lost to the local economy. In that sense, the scale of the issue goes far beyond the business itself.

Stuart McMillan welcomed the fact that Texas Instruments gave us some lead-in time to its announcement, which has allowed us time to seek a long-term future for the site and the workforce. Since taking up my role as Minister for Business, Fair Work and Skills, I have attended both meetings of the Texas Instruments task force that have been convened in that time. Of course, Paul Wheelhouse attended the meetings that were convened while he was business minister. As has been set out, the task force was a creation of Inverclyde Council, and it has been a good approach. Inverclyde Council established and convenes the task force, but the Scottish Government has been a critical participant. Also at the table are Skills Development Scotland, Scottish Enterprise and, critically and crucially, Texas Instruments—because it is best placed to tell us precisely what is happening at the site at any given time. Since I have been the business minister, MSPs of various political colours have been at the table: Stuart McMillan has been present, and Maurice Corry was at one meeting. Councillors of different parties also attend. In that sense, we are having the open, frank and necessary dialogue that has been mentioned.

As a Government, we have a strong commitment to work with the task force to secure the long-term future of the plant and its workers. That is an ambition that we all share. We are pursuing the matter outwith the confines of the Texas Instruments task force. In February this year, Keith Brown, then the Cabinet Secretary for Economy, Jobs and Fair Work, met the senior vice-president of Texas Instruments to discuss the situation. We have requested a further meeting with the company’s chief executive, and we have continued to engage with the managing director of the Greenock plant. In conjunction with the council’s officers, Scottish Government officials are now focusing efforts through a working group that started meeting earlier this year.

We maintain that open dialogue with Inverclyde Council to consider interventions that we can take together to support the wider region. Scottish Development International has been working actively and with the utmost determination to find a buyer for the plant, which is the nub of the issue.

As other members have set out, it has been very clear from the outset that finding a buyer for the site has been a significant challenge. Stuart McMillan said that, unfortunately, several expressions of interest have not come to fruition, but discussions are still on-going between Texas Instruments and a potential buyer. We need to give them the time, space and confidentiality to find an agreement. That said, I have been absolutely clear that the Scottish Government remains utterly committed to doing everything that it can to support the purchase and secure the plant’s long-term future.

I thank the minister for his warm words. From attending meetings of the task force, he might have picked up its sense of frustration that similar high-profile potential job losses in other parts of the country—the number in Greenock is in the hundreds, as he mentioned—have garnered much more media focus and more of a national conversation. The situation seems to have gone largely under the radar. I hope that that will not affect the way in which the Government seeks to tackle it and help the community.

To put it simply, and to assure Mr Greene and all other members, no, it will not.

Just as Mr Greene might be frustrated on occasion, so am I, but I cannot control the media output. Notwithstanding the validity of his point, that will not impact on the Government’s determination to find and secure a future for the site and the workforce. In that regard, the engagement that we are undertaking right now is more than a tyre-kicking exercise.

The debate is important because it gives the matter a degree of prominence. It is right that we debate it as a Parliament and reiterate the scale of concern for not only the plant and its workforce but the broader region. We are doing all that we can to secure a viable future for the plant, and we will continue to work in partnership to seek to obtain a solution that is in the best interests of the employees of Texas Instruments, Inverclyde and the Scottish economy. In that regard, I assure Stuart McMillan and other members that we will leave no stone unturned.

Meeting closed at 17:20.