During the mid-1970s, we heard lots about the Ryder Report – a Government-sponsored raft of recommendations to ensure BL’s survival and growth into the following decade. Ultimately, they failed…
Here is a run-down of the framework for the Government bail-out of a failing car manufacturer, published in early 1975.
Ryder Report – Governing BL’s future?
Following a disastrous couple of years in the marketplace, by the end of 1974 BLMC was on the brink of bankruptcy. Its financial backers – the City banks – had become very nervous about its future, and persuaded Lord Stokes to approach Tony Benn for financial assistance.
Three-way talks were held between Stokes, Benn and the bankers, and the result was that the Government agreed to guarantee BLMC’s growing overdraft with the banks in exchange for a hand in running the operation. The body chosen to undertake this task was the National Enterprise Board, and its newly-appointed Chairman, Sir Don Ryder, was tasked with reporting on the company and listing recommendations for its future.
What did Ryder need to do?
Ryder had been plunged in at the deep end by the Government. He was given little time to make sense of the mess that had arguably been building up since before the merger of Austin and Morris in 1952. In a nutshell, he was faced with the following problems:
- Appalling record across the factories for striking and industrial disputes.
- Poor build quality and even worse image of the cars that the factories did manage to build.
- Inter-factory competition – workers at Longbridge feeling that they were working for a different end to those at Cowley – ‘Them and Us’ syndrome.
- A range of cars that comprised too many individual model ranges that often competed against each other.
- Weak and ineffective factory management, dominated by the shop stewards.
Sir Don Ryder’s report was called, British Leyland: The Next Decade, and, along with a team that included Bob Clark (Chairman of Hill Samuel), Fred MacWhirter (a senior partner of Peats) and Sam Gillen (the ex-head of Ford UK and Ford of Europe), he managed to produce this document in double-quick time.
Ryder actually passed it to Tony Benn on 26 March 1975, a mere 14 weeks after the original commission! Tony Benn approached the Cabinet for approval and they backed Ryder’s plan wholeheartedly. But some Ministers saw the Ryder Plan as a gamble, because it would set a precedent and dictate government policy for the rest of its term, and this would prove, in effect, to be the undoing of the 1974-79 Labour Government. The report immediately sparked off a round of high-profile resignations, most notably headed by John Barber (to be replaced by Alex Park).
Report published in record time
When The Ryder Report became public on 23 April, it had appeared in record time – rushed almost to the point of recklessness – and it pulled no punches. In brief, the report made the following recommendations:
- Donald Stokes should resign as company Chairman.
- The grotty factory machinery should be replaced and as a matter of highest urgency.
- A cohesive model strategy needed to be devised, cutting out the immense overlap in the company’s range.
- The company should build a new test and development centre in order to facilitate more efficient development of new cars.
- Industrial relations problems should be eradicated.
In terms of finances, it would take an enormous amount of investment to return the company to health, making it a ‘viable and fully competitive’ company by 1981. The Ryder Report proposed that capital expenditure of no less than £1,264 million would be required from the Government, along with £260 million worth of working capital.
These numbers must have made eye-watering reading for Tony Benn, but this paled into insignificance beside the alternative – the notion that the Government had allowed the UK’s leading car company to dissolve. No one wanted to imagine the consequences if the Ryder plan failed because there would be an estimated million people put out of work if British Leyland were closed.
No opposition from the Government
Harold Wilson did not oppose the plan at all – in fact, the Government gave the plan its full and unconditional blessing – and it went forward, full steam ahead. As a result, BLMC ceased to exist as an independent company and, on 27 June 1975, it became known as British Leyland Limited. This signified that the company was now fully under Government control.
Against Ryder’s recommendations that Donald Stokes should resign, Harold Wilson stated that he was his personal friend and that his sacking (for events that were not entirely of his own doing) would hurt the man terribly – it was highly unfair that he was being made the scapegoat for the sins of his predecessors.
The Prime Minister thought that Stokes would be far better employed as some kind of travelling export promoter for the company – an acknowledgement of the fact that Stokes was undoubtedly a super-salesman and an audacious negotiator. Because of the direct involvement of the Prime Minister, Stokes was made the Non-Executive Chairman of the company – effectively a figurehead, just as Wilson had envisaged.
Optimistic about British Leyland’s future
In the event, the Ryder Report was certainly very optimistic about the future of the company, painting a rosy image of what shape it would be in by 1981. One controversial prediction, on which Ryder based a great deal of his forward projections, was that BL would maintain a 33 per cent share of the market in UK.
Amazingly, Ryder made no recommendations for plant closures, just sweeping organizational changes to the management structure. In line with Ryder’s recommendations, Sir Ronald Edwards replaced Donald Stokes as the Executive Chairman of British Leyland, but he would tragically only remain in the role until January 1976 – a mere four months – due to his untimely death.
As far as the output of British Leyland was concerned, Ryder recommended that the company remained a presence in both the volume and specialist manufacturing fields and that it should be split-up into four divisions: Cars, Trucks, International and Special Products. Although Ryder recognised that BL had to ensure that each of the company’s marques should retain their independent identities, he maintained that the BL had to pool its resources – under the all-embracing title of Leyland Cars.
Internal reorganisation needed
The way to do this was to reorganize car production to reflect the fact that Austin-Morris and the Specialist Division would, by this time, need to become a single integrated car business meaning that all development and marketing would be shared. Derek Whittaker, the former Managing Director of British Leyland’s body and assembly division, was the man charged with the unenviable job of putting these recommendations into place, getting the job of running the car division.
Unlike some of his predecessors, Whittaker was a quiet man and a no-nonsense manager, and it was because of these qualities that he was chosen for this role. His first task was to ensure a smooth transition from the separate Austin-Morris and Specialist Division franchises into this unified entity. Whittaker would find the two years for which he was to lead the car division to be a rough ride – especially with regard to the mounting union unrest and the resulting lost car production.
Expansion to lead to prosperity
Ryder had recommended the expansion of the company – to build themselves out of their financial mess – but this still did not address one of the most pressing matters: the unpopularity of the company’s products.
The National Enterprise Board was officially given the task of overseeing the direction that British Leyland was going in, and ensured that Ryder’s plans for the company were being implemented. A partial nationalisation of BL was proposed by Ryder, whereby the National Enterprise Board would allocate large sums of money over the following four years in order to guarantee the company’s survival. Existing shareholders would be offered just 10p per share for their holdings with a nominal value of 50p – down from a peak of 80p in the post-merger euphoria.
The Government’s shareholding was increased with each succeeding year but, contrary to popular belief, they never owned 100 per cent of British Leyland, they were ever only a majority shareholder.
- Archive : MP’s savage Ryder report – AROnline : AROnline
- History : British Leyland, the grand illusion – Part Three – AROnline …
- History : British Leyland, the grand illusion – Part Four – AROnline …
- Archive : 40 years ago – Ryder Report submitted for Government approval
The official summary of the Ryder Report
We were appointed on 18 December 1974 to conduct, in consultation with the corporation and the trade unions, an overall assessment of BLMC’s present situation and future prospects, covering corporate strategy, investment, markets, organization, employment, productivity, management/labour relations, profitability and finance; and to report to the Government.
At the same time the Government obtained Parliament’s approval to a guarantee by the Government of lending by the banks to British Leyland (BL) of up to £50m.
Prospects for industry
We decided that, in assessing BL’s situation and prospects, it would be useless to take a short-term view. In the motor industry three or four years must elapse between the decision to introduce a new model, or to undertake a major plant modernization and the completion of these projects. Once the new model is introduced and the new plant is in full operation, many more years must elapse before resources can be available to replace the model or renew the plant.
Therefore, decisions made now about a capital expenditure programme extending over five to seven years must take into account market prospects 10 years from now. Our starting point was therefore to examine world market prospects for the motor industry generally over the period to 1985. It is unusually difficult to make such an assessment at present. The past 18 months have seen a sharp rise in the price of oil relative to other goods, historically high rates of inflation throughout the world, and a cutback in economic growth, and consumer demand in the main industrial countries. As a result, car sales which had grown rapidly over the two decades up to 1973 fell abruptly in all major markets in 1974 and may be no higher and perhaps even somewhat lower this year.
Along with more long-term anxieties about the environment and congestion, the recent drop in demand has raised some doubts and uncertainties about future prospects for the motor industry. Broadly, our view is that while the world market for the motor industry over the next decade will undoubtedly be less buoyant than in the recent past and will be more fiercely competitiye, particularly in the early years when there is likely to be excess capacity, it will remain a large and valuable market. Moreover, in some areas of the world and for some types of vehicles, considerable growth in sales can be expected.
Nearly half the vehicles produced by BL are cars for the United Kingdom market. The United Kingdom market for cars depends mainly on trends in the economy, particularly in the growth of consumers’ expenditure, and on action which governments take to influence these trends. On reasonable assumptions about these matters we think that the total United Kingdom car market should start to grow again in 1976, should by 1980 have recovered to the 1973 peak of 1.6 million vehicles and should between 1980 and 1985 grow further to at least 1.7 million vehicles and possibly a higher level.
The prospects in overseas markets for cars are discussed. In western Europe (excluding the United Kingdom), which accounted for nearly 60 per cent (some 200,000) of BL’s overseas car sales last year, we believe that total demand will start to recover next year, should reach around 9 million cars in 1980 (13 per cent higher than in 1973) and at least 10 million cars (26 per cent higher than in 1973) by 1985. In most other markets, including the United States, which last year accounted for about 15 per cent (some 52,000) of BL’s overseas car sales, the pattern is expected to be more like that in the United Kingdom, a recovery to 1973 levels by 1980 and little growth between 1980 and 1985. The prospects for vans both in the United Kingdom and western Europe are broadly the same as those for cars.
The United Kingdom market for heavy trucks is discussed. Partly as a result of the tendency to replace such vehicles more frequently because of more stringent vehicle legislation and the cost and scarcity of qualified maintenance staff, total United Kingdom demand for heavy trucks seems likely to be about 30 per cent higher than last year, by 1980 and there should be some further modest growth between 1980 and 1985. The prospects in overseas markets for heavy trucks are good. This is particularly true of those countries which either produce oil (lran and Nigeria) or have good access to favourably priced oil (Turkey), and are growing fast. In these three countries it seems likely that demand for heavy trucks will more than double by 1985. There is also a large market for heavy trucks in western Europe which shows modest but significant growth prospects over the next few years and where BL has a major opportunity for increasing its penetration.
For buses there are problems in forecasting demand both in the United Kingdom and overseas, since it turns on the placing of particular large contracts. In the United Kingdom, BL is a dominant supplier of many types of bus (notably double-deck buses) and operators seem likely to want to place large orders over the next few years which BL could not meet. We recommend that the Department of the Environment should as a matter of urgency hold discussions with BL and the major United Kingdom bus operators to work out arrangements for better coordination between the bus operators and BL to phase orders and deliveries. As capacity becomes available, both to meet home demand and to supply overseas markets on a more regular basis, BL will have to make a more systematic attempt to forecast overseas demand for buses. For agricultural tractors, which accounted for only 13,000 of BL’s total sales of over 1 million vehicles in 1973-74, demand at home and overseas will probably continue to decline, although there’ will be growth in some countries where mechanization of agriculture is likely to develop over the next few years.
The right strategy for BL
Against the background of this assessment of world market prospects we considered what strategy BL should follow over the next decade. We examined the following issues:
(i) Whether there is a future for BL as a vehicle producer;
(ii) Whether BL should diversify into non-vehicle activities and divest itself of its existing peripheral activities;
(iii) Whether BL should remain a producer of both cars and commercial vehicles.
(iv) Whether BL should remain a producer of both volume and specialist cars;
(v) In which geographical areas BL’s marketing effort should be concentrated.
We concluded that there was undoubtedly a future for BL as a vehicle producer. Although competitive pressures will increase over the next decade, there is no reason why BL should despair of improving its position in this very valuable market. Vehicle production does not involve the kind of advanced technology which can only be financed in very strong and highly developed economies such as the United States. On the other hand, although there is likely to be an increasing trend towards local manufacture in the developing countries, there is enough scope for sophistication and refinement to give established producers with skilled labour forces a competitive edge in the developed countries. In general, therefore, vehicle production is the kind of industry which ought to remain an essential part of the United Kingdom’s economic base. We believe, therefore, that BL should remain a major vehicle producer, although this means that urgent action must be taken to remedy the weaknesses which at present prevent it from competing effectively in world markets.
Since BL is already a very large company and needs to concentrate its managerial skills and resources on improving its competitive position as a major producer of vehicles, we concluded that it would not be wise for BL to diversify its activities into unrelated sectors of industry. We have, however, recommended a neutral policy on the divestment of BL’s existing peripheral activities: the operations grouped in BL’s special products division and Prestcold Limited. We provide some factual information about these activities, pointing out that there are major market opportunities and growth prospects for Prestcold in particular which need to be vigorously pursued.
We have, therefore, proposed that, following the Report, there should be a detailed investigation of the future of these companies. We concluded that BL should remain a producer both of cars and of trucks and buses and also that BL should continue in both the volume and the specialist sectors of the car market. In particular we considered whether BL should abandon the small/light sector of the market. In practice, this would mean that BL would not provide for any replacement for the Mini in its future product plans.
We concluded that there were strong arguments both on commercial grounds and on national economic grounds for BL to continue in the small/light sector of the market. In order to compete effectively in all the major sectors of the car market BL would have to cut out competition between models in the same sector and reduce the number of different bodyshells, engines, transmissions, etc. Similar rationalization would be necessary in trucks and buses. BL would also need to build on the reputation for quality and distinction which it enjoys in the more expensive sectors of the market. All its models, throughout the product range, should have sufficient distinction to ensure a competitive edge against the very high volume producers. On markets we concluded that the main thrust of BL’s marketing effort overseas should be to increase its present small share of the expanding western European market both for cars (under 3 per cent at present) and for trucks and buses (about 1 per cent at present). BL should also continue to take full advantage of the very rapidly growing, market for trucks and buses in certain developing countries as Iran, Nigeria and Turkey.
We set out our assessment of BL’s financial capability for carrying out this strategy. An examination of past trading results shows that throughout the period since BL was formed in 1968, profits were wholly inadequate and insufficient to maintain the business on a viable basis. To make matters worse nearly all the profit was distributed as dividends instead of being retained to finance new capital investment. A substantial proportion of BL’s fixed assets were old and had been fully written down. The depreciation charge was therefore an inadequate measure of what should have been spent on capital replacement. Working capital was also run down to a critical level. We concluded therefore that BL’s present levels of capital expenditure and working capital were far too low. Even to maintain these levels in real terms would, because of inflation, require BL to earn at least £100m a year profit, and much larger sums would need to be earned to make up for the capital run down in the past.
We concluded, therefore that very large sums would be needed from – external sources to finance the action required to make BL a viable business.
Product range and markets
In considering what action would be required to make BL viable, we looked first at BL’s product range and market objectives. On the product plan the time lag meant that we could not make any recommendation for introducing new models before the end of 1978. Our other recommendations, together with BL’s existing product plan to the end of 1978, are mainly directed to product rationalization.
With this product plan we consider that BL should be able to retain in the early 1980s its present share of the UK market for cars, trucks and buses. BL’s base in the UK market is still one of its major strengths. As competition from imports will increase substantially, maintaining this home market share will require a considerable and sustained marketing effort by BL. We recommend, however, that BL. should devote more effort than in the past to developing overseas sales.
In recent years BL has had a poor reputation in many overseas markets for not keeping delivery promises, for shortage of parts, and for inadequate after-sales service. Within overseas markets we recommend that the main emphasis should be on western Europe. In western Europe (excluding the UK) BL should aim to improve its share of the car market from around 3 per cent to around 4 per cent and of the truck market from around 1 per cent to around 5 per cent. BL should also take full advantage of the opportunities for truck sales in the richer developing countries such as Iran, Nigeria and Turkey.
We next examined BL’s engineering resources and facilities to see whether they would be capable of carrying out this extensive programme of product development and rationalisation. We consider that the dispersed and fragmented organization of BL product development engineering is a serious weakness. We propose that the skills concerned with various aspects of product development, product planning, styling engineering and vehicle engineering should be brought within a single product development organization for cars and that there should be a similar organization for trucks and buses.
BL also needs new central laboratories and workshops for the design and development of new car and components. We recommend that these should be built by 1979; as an interim measure, temporary facilities probably at Solihull, should provide the centre of control for vehicle engineering personnel; the truck and bus facilities at Leyland should be extended as a matter of urgency. An early decision is needed on how test track facilities can best be provided for BL.
We next examined the adequacy of BL’s production facilities. A detailed study has been made which will be available in due course for BL’s ongoing management.
For historical reasons BL has a large number of plants scattered throughout the country: although some progress has been made since the merger towards a more logical arrangement of manufacturing operations in the different locations, there is still too much movement of manufactured parts and sub-assemblies between plants. In body and assembly operations we recommend that individual plants should be associated with one or more model lines from the receipt of pressed-out panels to final assembly. Likewise, plants should specialize in the production of engines, gearboxes and chassis without distinction by model type and without being involved in body assembly operations.
Similar parts should be produced in the same location. A senior executive should be appointed to develop BL’s parts manufacturing activities to improve costs and reduce the number of different parts. Substantial economies could and should be achieved quickly by a programme to improve the layout of processes within plants. The most serious feature of BL’s production facilities is, however, that a large proportion of the plant and machinery is old, outdated and inefficient. BL’s foundries are in urgent need of modernization to bring them up to modern efficiency levels and safety and environmental standards. These serious deficiencies are the result of the lack of provision for capital expenditure. A massive programmne to modernise plant and equipment at BL must therefore be put in hand immediately in conjunction with the new product plan.
Organisation and management
We then considered whether BL’s existing organization and management would be appropriate to carry out the strategy we had proposed and the necessary programme of product rationalization, reorganization of production and engineering facilities, and new capital investment. We are convinced that BL’s present organizational structure has harmful effects on the efficiency of BL’s operations and is likely to impede its future development. It combines most of the disadvantages of both centralized and decentralized organizations with few of the advantages of either. There has been inadequate integration of the product planning, engineering, manufacturing and marketing of cars.
The Managing Director has too many people reporting to him. The creation of a large corporate staff has undermined the authority and responsibility of line management.
Our approach has been to divide up BL’s activities, within the overall corporate structure, into four separate businesses,
- British Levland Cars
- British Leyland Trucks and Buses
- British Leyland Special Products
- British Leyland
Each would be a profit centre in its own right with its own Managing Director. At corporate level there would be a non-executive Chairman and a Chief Executive and a corporate staff drastically reduced to the absolute minimum. We considered and rejected the approach of dividing up BL’s car operations into two or three separate divisions based on products (Austin Morris, Rover Triumph and Jaguar).
We believe that this would impede the policies of product rationalization and integration of design, engineering and production. We attach the greatest importance to the maximum delegation of authority and responsibility within the new structure, from the Chief Executive to the four Managing Directors and from them to the line management below them. This would take place within a framework of corporate planning and control. Proposals for the integrated organisation of the four separate businesses:
The most important proposals are those relating to British Leyland cars where we recommend four line divisions, one dealing with product planning, development and engineering, one with manufacturing, one with sales and marketing, and one with parts and KD (“knocked down”) activities. This is a radical change from BL’s present organization which consists of separate divisions for different products dealing with their own engineering and marketing and, to some extent, manufacturing, co-ordinated by corporate staff.
Associated with this new organizational structure and approach there will have to be changes in BL’s top management. In some cases we have been able to recommend particular individuals; in other cases, for reasons which are explained, we have not been able to do this but we have candidates in mind. The quality of BL’s second-rank management is generally good, and often very good.
Throughout our inquiry we were aware that, although we had many proposals to make BL more competitive, fewer and better models, improved facilities for design, engineering and production and changes, organization and management, BL’s success would depend most of all on the skills, efforts and attitudes of its 170,000 employees. We have therefore examined industrial relations at BL at some length. We do not subscribe to the view that all the ills of BL can be laid at the door of a strike-prone and work-shy labour force. Nevertheless, it is clear that if BL is to compete effectively there must be a reduction in the man-hours lost through industrial disputes.
More productive use must also be made both of BL’s existing capital investment and the planned additional capital investment and this must mean more realistic manning levels and more mobility and interchangeability of labour. We found ample evidence that BL’s employees at all levels want to make their contribution to solving BL’s problems and we must therefore find ways of sustaining and developing this constructive approach.
We consider it essential that the progress of the capital expenditure programme and the injection of new finance by the Government should be staged and that each stage should depend on evidence of a tangible contribution by BL’s workforce and management to the reduction of industrial disputes and the improvement of productivity. Careful forward manpower planning will be needed particularly in areas where major rationalization of production facilities is undertaken.
We considered measures to improve industrial relations at BL under three main headings – payment systems, collective bargaining and industrial democracy.
We concluded that there should be no major change in the system of payment by measured day-work; there is, however, scope for improving the system and the possibility of introducing some incentive element in the future should be kept under review.
We recommend that BL should continue to negotiate basic wages and conditions through the Engineering Employers’ Federation, but should keep under review the balance of advantage of remaining within the federation. The basic agreements negotiated through the EEF are supplemented by local bargaining at plant level. We consider that the multiplicity of bargaining units and renewal dates is an unsettling factor in BL’s industrial relations. We therefore recommend that discussions should be held with the trade unions about a gradual but substantial reduction in the number of collective bargaining units within BL and about a reduction in the renewal dates for wage settlements. BL line management in the new bargaining units should have sufficient delegated authority to negotiate effectively.
The most crucial factor in improving industrial relations at BL and in creating the conditions in which productivity can be increased is, however, that there should be some significant progress towards industrial democracy. Means must be found to take advantage of the ideas, enthusiasm and energy of BL’s workers in planning the future of the business on which their livelihood depends.
The contribution which we are seeking to the reduction of industrial disputes and the improvement of productivity can only be made in an atmosphere of joint problem solving by management and unions. There should be a framework, removed from the normal arrangements for collective bargaining, in which agreement can be reached on the action required. We have therefore proposed a new structure of joint management/union councils, committees and conferences, in which BL’s shop stewards and particularly their senior shop stewards will have a major role. Trade union members will have to recognise the new responsibilities which the shop stewards are exercising. Urgent action is needed to remedy weaknesses preventing effective competition for sales.
Cost of programme
We have therefore sought to devise a comprehensive and balanced programme to make BL a viable and fully competitive vehicle producer. We have assessed the financial consequences of the programme up to the end of September 1982. In doing so we have thought it necessary to make some assumptions about future rates of inflation. Inevitably, because of the backlog of past massive underinvestment, the capital expenditure required is very large. In constant price terms it is £1,264m and in inflated price terms £2,090m over the eight years to end September 1982. There will also have to be an increased provision for working capital of around £260m in constant price terms or £750m in inflated price terms.
Although the cost of this programme is large we are convinced that this expenditure is necessary to make BL viable and fully competitive. A forecast has been prepared of the effect of this additional expenditure in improving BL’s profits on certain assumptions, including an important assumption about the contribution from the workforce in agreeing to manning reductions and greater mobility and interchangeability of labour.
Our forecast is that BL’s profits as a percentage of sales should improve to 11 per cent in 1981/82 compared with an average of 6.5 per cent in the period 1968/69 to 1973/74. BL’s return on capital employed is also forecast to improve to 19.6 per cent in 1981/82 compared with an average of 9.6 per cent in the period 1968/69 to 1973/74. While we recognize that this is not a satisfactory return, it must be appreciated that it is caused by the past massive under-investment. After 1982 BL should start to reap the benefits of the new capital expenditure programme. We then analysed the effect on BL’s cash flow.
Although BL is forecast to achieve a positive cash flow in 1981/82 there is likely to be a requirement for funds from external sources during the period 1974/ 75 to 1980/81 of £1,300m to £1,400m in inflated price terms. In the period to end September 1978, the requirement is forecast to be £900m in inflated price terms.
Financing of the programme
We set out our proposals for financing the requirement of £900m in inflated price terms up to the end of September 1978. In our view, a very large part of the funds can only be provided by the Government and we argue that there is an overwhelmingly strong case for the Government to provide the funds, because of BL’s importance to the national economy. We recommend strongly against appointing a receiver for BL.
We therefore propose that the Government should be prepared to provide £200m in equity capital now and up to £500m in long term loan capital in stages over the period 1976 to 1978. The equity capital should be provided by the Government’s underwriting of a rights issue to existing shareholders, following a capital reconstruction through a scheme of arrangement.
It is likely that relatively few shareholders will take up these rights and the Government will therefore be left with most of the shares. The rights issue should be preceded by an offer by the Government to buy out existing shareholders at a price of 10p per share. On the inflation assumptions a further £500m is forecast to be required between end September 1978 and end September 1982. It is not possible to foresee the type of financing which will be appropriate for a period so far ahead but the Government must be prepared to make funds available either as loan capital or as a mixture of loan and equity capital. We recommend that, following the initial injection of £200m of equity capital, there should be review points on each occasion when a further tranche of funds is provided to assess the contribution being made to the reduction of industrial disputes and the improvement in productivity.
The timing of the programme outlined in our Report is crucial to BL’s survival.
When the Government announces its intentions about BL, a major effort must be made to ensure that the proposals are fully understood by the employees and that the employees recognize the implications for them. A series of meetings will have to be arranged throughout BL at which the new management of BL can explain what the capital expenditure programme means for the future of BL, that the injection of substantial funds from the Government will be dependent stage by stage on progress towards reducing industrial disputes and improving productivity, and that management and trade union representatives have been asked by the Government to set up a new structure of joint councils, committees and conferences to seek agreement on the action required.