BAE to cut 946 UK jobs

BAE Systems has ignited debate over the highly charged issue of the defence spending review by unveiling plans to cut almost 1,000 jobs and blaming the move on public spending restraint.

The UK’s biggest military supplier is targeting job losses in its warplane division but has warned that shipbuilding could be badly hit by reductions in naval cash.

Kevin Taylor, managing director of BAE’s Military Air Solutions division, said the potential job losses would come in manufacturing, engineering and associated support functions for aircraft such as the Tornado.

“These potential job losses result from the impact of the changes in the defence programme announced in December 2009, together with other workload changes,” he said, while unions warned the cutbacks could be “the tip of the iceberg” given the wider threat to military budgets from the current spending review.

Almost 450 jobs are at risk at two BAE sites in Lancashire – Samlesbury and Warton – with more than 200 threatened at BAE’s plant in Brough, Yorkshire. Jobs are also expected to go at Farnborough and at Chadderton, Oldham, where the Lancaster bomber was built.

BAE said it had started consulting with workers about 740 job cuts across the five plants, but union leaders said that another 206 jobs were also being shed across BAE’s integrated technologies division, Insyte.

BAE’s announcement today is an embarrassment for a government that has said it would like to rebalance the economy and move away from financial services by reinvigorating the manufacturing sector.

BAE has cut thousands of jobs over the last two years, including 230 at its submarine shipyard at Barrow-in-Furness, 500 at its Land Systems division, and hundreds more at various sites including Guildford, Leeds, Telford, Newcastle and Leicester.

BAE is the UK’s largest defence company and one that provides a range of very well paid jobs. But it has also a controversial reputation, having accepted guilt in relation to accounting offences and agreed to pay penalties in the US and the UK totalling several hundred million pounds to settle long-running allegations of corruption.

Under a deal announced simultaneously in London and Washington last February, BAE said it would pay $400m (£255m) in the US and £30m in the UK.

In the US, the company will plead guilty to accounting irregularities to settle bribery allegations made over the enormous al-Yamamah arms deals with Saudi Arabia stretching back more than 20 years, as well as corruption allegations over arms deals in central Europe.

The deal with the Serious Fraud Office in the UK covers one arms contract only, under which an overpriced military radar was sold to Tanzania. The SFO said some of the cash would become “an ex gratia payment for the benefit of the people of Tanzania”.

From: Guardian