Government aims to increase support for UK train makers

5 July 2011

5 July 2011 | Adam Leach

Transport secretary Philip Hammond is consulting on ways to increase support for UK train manufacturers when awarding rail and infrastructure contracts.

Speaking this morning on Radio 4’s Today programme, he said: “My observation is that the way some of our continental partners approach these things is to look more strategically at the support to the domestic supply chain.” He highlighted that both France and Germany “routinely” award contracts to domestic suppliers.
The issue of domestic support was raised as train manufacturer Bombardier announced it is to cut more than 1,400 jobs from its Derby factory.

Hammond said the Department of Transport is already looking at ways to increase support for the UK supply chain, to come into effect before tenders are submitted for the Crossrail project. He said he is confident that “even within the constraints of the EU procurement directive” it is possible to increase domestic bidders’ chances of success. 

However, shadow business secretary John Denham, also speaking on Today, called on the government to re-open its decision to award the building of carriages for the Thameslink programme to German manufacturer Siemens, instead of Bombardier. But Hammond said his department could only act on the basis of the criteria for the project that was determined by Labour in 2008. He said their only other option was to scrap the project, which was already late and has already cost £1 billion.

Hammond then quoted from a letter he received from Bombardier in May. That explained that job cuts were the result of other work having come to an end and said 1,200 positions would have to go whether or not they won the Thameslink deal. The letter said: “The successful completion of existing contracts means that it is already inevitable that Bombardier will experience a dip in workload, the scale of which will mean the lay-off of around 1,200 employees.”

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