Twinings grant: MEPs must prove EC acted unlawfully
263 UK jobs will be lost as a result of the firm transferring tea processing operations from North Shields to the site in Swarzedz, while an existing Chinese plant is also being extended, some 129 staff in Andover will also lose their jobs when operations are streamlined.
MEPs Keith Taylor, Peter Skinner and Stephen Hughes – together with Fiona Wilson from the Union of Shop Distributive and Allied Workers (USDAW) – met EU employment commissioner László Andor on Tuesday in Brussels to demand repayment of the grant.
Tried to establish grant illegality
Andor told the politicians that Twinings’ grant should be blocked if they could establish that the EC had acted in an unlawful manner by authorising the grant, something that they then undertook to do directly at the meeting, although without immediate success.
However, Taylor told FoodManufacture.co.uk this morning that he was "hopeful for a positive outcome on two fronts: both in blocking payment of the grant award and seeking money from the Globalisation Adjustment Fund (GAF) for workers".
The GAF reserves €500m of EU funds each year to help workers "severely and personally affected by trade-adjustment redundancies", and provides money for such activities as finding work, specialised retraining and self employment.
Taylor said: “After this meeting I have agreed with my fellow MEPs that we must try to establish that the Commission has acted unlawfully. There is case law which suggests that national subsidiaries of multinational companies cannot benefit from this funding without guaranteeing funds will not be used simply for relocating jobs.
“We will be doing all we can to show that the Twinings decision was wrong. The Commission needs to adhere to the principle that regeneration funding should be used for genuine job creation, not job relocation.”
Plan to petition EU Parliament
Taylor added that the MEPs are promoting the submission of a petition to the EU Parliament “drawing attention to the infringement of proper procedure”, which if accepted would prompt an official investigation.
Andor said the EC would welcome an application from the UK government to pay funds to Twinings workers under the GAF, where it is the responsibility of the Department of Work and Pensions (DWP) to apply if it believes there is a valid case.
Taylor said the three MEPs would all write to the DWP asking them to apply, but warned that that no British government has ever applied for GAF funding, although other member states (in particular Ireland and Denmark) have made extensive use of it.
EC still awaiting Polish response
Andor added that his colleague Johannes Hahn (the Commissioner responsible for EU regional development funding) is still awaiting a further letter from the Polish government concerning Twinings' Polish subsidiary.
The EC has been pressing state officials since last summer to reveal what assurances they "sought or received" that the €12m would be used for regeneration, not production relocation, where the latter employment of such a grant is illegal under EU law.
Associated British Foods (the tea firm’s parent company) originally applied for the ERDF (European Regional Development Fund) grant when the subsidiary was still officially registered as a small to medium-sized enterprise (SME).
Hahn told Taylor in a letter last November that, although staff numbers at the Polish firm exceeded the SME threshold at the time of the grant application, it would only become a large enterprise “once the headcount and financial thresholds have been exceeded for two consecutive accounting periods, i.e. at the start of 2011”.
Earlier this week Twinings denied claims from the trade union USDAW that there were teething problems at its new Polish site, which began production on January 3.
One Andover employee said that the first jobs are likely to go at the site at the end of April, with the majority of staff affected following in June; redundancies are scheduled to begin at the North Shields site soon.
