Three of the largest defence contractors in the UK – Babcock, BAE, and Thales – have warned of severe repercussions should there be a Yes win in the referendum on September 18th. More than 20,000 jobs in Scotland directly rely on these defence contracts and concerns are mounting about their future.
Babcock is Scotland’s largest engineering employer, with approximately 8,000 people on their books, and they bring more than £500million annually to the Scottish economy. Management believe a Yes vote would seriously jeopardise their Royal Navy contracts at Rosyth and wipe millions of pounds of the value off their operations at Her Majesty’s Naval Base on the Clyde. The knock-on effect of these financial losses would impact upon the rest of their Scottish operations, including North Sea oil and gas, and the railways.
Raymond Duguid, Unite convener and trade union chairman at Babcock, told the Committee that the Scottish government and Yes side, had painted a utopia to lure voters in and hadn’t honestly spelled out the consequences of independence.
“I firmly believe the people of Scotland are not daft enough to believe that this is all milk and honey and everything is going to be better, because it’s not, it’s not at all,” he said.
Sir Roger Carr, chairman of BAE, has made it clear that a £270million pound investment in their Scotstoun shipyard is on hold until the outcome of the referendum. A Yes vote would signal a, “lengthy period of uncertainty that would have adverse consequences for the group’s business, financial condition, operating results and prospects.”
During his appearance at a Scottish Affairs Select Committee meeting, Henry Wilson, Unite staff convener at BAE Systems, said the unions knew that UK defence contracts would not be awarded to a foreign country, such as Scotland should independence be declared.
“If there is a Yes vote in September, as far as we are concerned, shipbuilding is finished in Scotland,” Wilson said. “From a trade union perspective we are under absolutely no doubt whatsoever from statements that have been made in Parliament, that these contracts will not be placed in Scotland. If a No vote isn’t successful and we go independent that £270 million investment will not come to Scotland.”
Victor Chavez, the CEO of Thales, a vital defence company who employ 650 people in Glasgow, reiterated the concerns of his colleagues. In a publicly-released comment he stated that, “I can see no discernible benefits to our domestic or export prospects from independence. For our Glasgow business, independence would take its largest domestic customer and make it an export customer, with all the inherent complexities and challenges that would involve. This clearly would have a negative impact on Thales.”
Chavez’s comments come on the heels of a union statement circulated within the company that stated, “Our view remains that Thales UK Glasgow is in a vulnerable position should it be a Yes vote. It’s already difficult to win orders while Scotland is part of the UK, so how would we bid and win orders from outside the UK?”
An SRS spokesperson believes: “The fact that Alex Salmond is trying to pull the wool over voters’ eyes and not face up to the real economic impact that these vital employers are warning about beggars belief. Whole communities depend on these jobs and it is simply not an option to ignore their concerns. Salmond should be courting them, not running away from them and refusing to meet them until the rot has sunk in. You can’t just choose which news you want to hear, you have to face up to it all.”