200 redundant at Swan Hunter despite rescue deal: Soffia plan awaits approval from Ministry of Defence Work for remaining 630 workers runs out in November

MORE THAN 200 Swan Hunter shipyard workers temporarily laid off at the end of May are to be made redundant at the end of this week. The news comes as a rescue deal struck between the Tyneside yard's receivers and Soffia-CMN awaits approval from the Ministry of Defence.

One of the receivers, Ed James of Price Waterhouse, said they had no option but to make cuts. 'It is regretted that these redundancies have become inevitable but there is no work in the foreseeable future for those concerned.'

Soffia, based in France, has agreed a deal with the receivers that will enable it keep the yard's design team together and bid for further MoD and commercial shipbuilding contracts.

But the agreement needs clearance from the MoD, which has so far proved unwilling to provide work for the yard. Existing work for the remaining 630 workers runs out in November.

Yesterday the receivers warned that unless Soffia agreed to pick up Swan Hunter's large wage bill by the end of this month, 100 key design staff would have to be laid off, severely limiting the company's ability to tender for new work.

If the Soffia rescue plan is approved, Swan Hunter will bid later this year for a pounds 50m contract to build an ocean survey vessel for the Royal Navy.

Yesterday's redundancies came as little surprise following the failure of the yard to clinch two crucial orders totalling around pounds 50m. Financial insecurity prevented Swan Hunter taking on a pounds 6m contract to refit the tanker Olwen earlier this month, and a vital pounds 40m order to refit the landing ship Sir Bedivere went to the Rosyth shipyard in Scotland last month.

Although the cuts had been expected, the senior union convenor at the yard, Dick Gonzalez, said the announcement came as a blow. 'The workforce are very down at the moment because every time we have a meeting like this with the receiver, it seems something drastic happens,' he said. 'Everything hinges on this government doing the right thing.'