Burton's defends closure plans as MP launches attack

Eagle - who is Labour MP for Wallasey - is leading an adjournment debate in the House of Commons​ tonight (Jan 26) about Burton's Foods’ plans to close the site with the loss of 342 jobs​.

Speaking to FoodManufacture.co.uk earlier today, she said: “The company signed a memorandum of understanding (MOU) with the workforce in 2007 ​[when the site was last under threat of closure] that it would not undergo further significant restructuring until 2012, but is now saying there is no alternative to closing it.​

“The company says the site is loss-making, but it is impossible to verify this based on the very limited information that it has made available so far."​

Burton's: Overcapacity issue​

However, a spokesman for Burton's insisted that the agreement to keep the site going outlined in the MOU was always "subject to significant business change, and we would argue that the world has changed significantly since 2007. Burton's Foods has invested more than £17m in Moreton since 2001, including £3m since 2008, but the business now finds itself with an overcapacity issue."​

He also rejected claims that bosses had not given staff access to the data they needed to respond to its proposals.

He added: "The Unite union has been given a 38-page document detailing a good section of financial data, and we are also putting together a data room that will provide much more information. It is true that there has been a slight delay in setting this up, but that's because of the sheer volume of information we are putting in it. It has been agreed with Unite that this will be available from tomorrow (Jan 27)."​

It was also "in the public domain that the site has been losing money for two years", ​he claimed.

Ritchie James, regional organiser for Unite, said that while Burton's had claimed Moreton was losing money, a lot depended on the way that overhead costs were allocated. “It’s an argument that’s been going backwards and forwards.”​

The union, which has demanded an extension to the consultation period because of how long it had taken company bosses to hand over the financial data to the workforce, was also looking into the legal status of the MOU, he said.

Outsourcing chocolate refining​

Speaking to FoodManufacture.co.uk earlier this month​, Burtons Foods boss Ben Clarke said Moreton (which makes chocolate biscuits and has a chocolate refinery) was the smallest of its four UK biscuit factories but had the highest cost base.

He added: “We are also looking into the feasibility of outsourcing chocolate refining to a third party specialist." ​

The firm, which entered into a 90-day consultation period with staff on January 12, expects biscuit production to start transferring to factories in Edinburgh and Llantarnum in the spring. However, plans to introduce new shift patterns and working practices will also result in 70 redundancies at Llantarnum, which employs 725 staff, he said.

"Demand in the biscuits market is incredibly volatile because of seasonality but also the high levels of promotional activity, so we need to be much more flexible in the way that we manage production and structure our workforce."​

Burtons, which makes Maryland Cookies, Jammie Dodgers, Wagon Wheels and own-label biscuits, plus Cadbury-branded products under licence, is owned by Apollo Global Management, Canadian Imperial Bank of Commerce and private equity firm Duke Street Capital.

The firm, which has its HQ in St Alban's, has four UK factories in Blackpool, Moreton, Edinburgh and Llantarnum.