Bombardier says lost government contract cost jobs

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The Independent Online

Unions and opposition politicians yesterday called on the Government to give national interests higher priority after Britain's last train maker blamed missing out on a state contract for its decision to cut more than 1,400 jobs.

The UK division of Canada's Bombardier said it was cutting 446 permanent jobs and 983 contract staff at its Derby plant, which employs 3,000. The company last month lost out to Germany's Siemens in bidding to build 1,200 carriages for the Thameslink route from Bedford to Brighton.

Bombardier said that by the end of September work would be finished on two contracts leaving only one. "The culmination and successful delivery of these projects and the loss of the Thameslink contract, which would have secured workload at this site, means it is inevitable we must adjust capacity in line with economic reality," Francis Paonessa, president of Bombardier UK's passengers arm, said.

The Government said it chose Siemens because it was the best value for money and because EU rules do not allow governments to favour companies based in their countries. But unions pointed out that Germany and France regularly favour their own manufacturers when awarding contracts.

Bob Crow, general secretary of the RMT union, said: "It's a scandal that the Government are colluding with the European Union in a policy of industrial vandalism. The German rail giant Deutsche Bahn awarded a £5bn fleet contract to German company Siemens and no one batted an eyelid."

The Unite union said the decision threatened Bombardier's Derby plant and the local supply chain, which is heavily dependent on the railway industry. John Denham, the shadow Business Secretary, and Maria Eagle, the shadow Transport Secretary, have written to David Cameron asking him to review the decision.

Philip Hammond, Transport Secretary, said: "There is a need to examine whether the UK is making best use of the application of EU procurement rules."