The capitulation by Unite to the so-called “survival programme” bulldozed through at Grangemouth by Ineos is a black day for workers everywhere. The terms of the surrender are galling to read: a three year pay freeze, a three-year abstention from strikes, the imposition of inferior pension arrangements and a ban on fulltime union convenors.
Unite had been active in defence of a union official facing victimisation by the company, a dispute which led to the threat of strike action. And the union continued to lead from the front when faced with the ultimatum from Ineos: Desist from striking and consent to punitive new contracts, or face the summary closure of the petro-chemical plant with the loss of 800 jobs. In words at least, Unite stood firm against this intimidation, actively encouraging staff not to return the new contract consent forms to management, instructing them instead to send them unsigned to the union office. This forthright approach encouraged militants to believe that the union was serious about taking on Ineos.
But then, when Ineos called its bluff, pressing ahead with closure, Unite leaders simply folded, prepared to sign up to anything to avoid this outcome. Where only days earlier the union had been emphasizing the strength of feeling in the plant in favour of industrial action, now the official statement piously noted that “decent men and women are being asked to make sacrifices to hold on to their jobs“, but that since this sacrifice was “the clear wish of our members“, then so be it!
This cocktail of adventurism and capitulation is the last thing workers in struggle need to hear right now. It is one thing to retreat in good order and live to fight another day. It is another to go down to the wire, do a complete flip flop then cheerfully proclaim, with Unite Scottish secretary Pat Rafferty that ” Relief will ring right round the Grangemouth community, and across Scotland today. Hundreds of jobs that would have been lost can now be saved and £300m will be invested into the plant .”
It is far from certain that even this shameful retreat, a retreat which cannot but lower the union’s credibility to an all-time low, will now suffice to slake Ineos’s insatiable hunger for profits. Whilst Alex Salmond bobs up to say that ” now we can all agree that Grangemouth has an outstanding future” and Grangemouth boss Calum MacLean smarms that ” What we have now done is given the chemicals business another 15 to 20 years on the back of new raw materials, new contracts and significant investment ,” the founder and chair of Ineos Jim Ratcliffe measures his words more carefully, claiming that Grangemouth “should have a life for many years to come, as long as we can get this gas terminal built and we can sign up gas contracts and bring gas in from America” (emphasis added). To this list of provisos should be added: so long as enough subsidy can be screwed out of British taxpayers, so long as the plentiful supply of cheap shale gas from the US remains constant in the endless flux of energy pricing, so long as the global overcapacity in the refining sector permits, and so long as (in short) a more tasty asset-stripping opportunity does not present itself some place else.
The Grangemouth complex works like this. North Sea oil is delivered to the refinery for processing. The waste products from this process are then delivered to the nearby petrochemical works, where they are used in the production of plastic and drugs. The petrochemical works only works at 60% capacity, in part because of the relatively low ethane content in North Sea oil. Ineos hopes to increase production by ending its reliance on the Forties field and piping in cheap shale gas from the US. But the petro-chemical works will have to be tooled up to deal with that kind of feedstock, and that costs a lot. If the petro-chemical works were to fail, then the refinery would likely follow suit. At the moment it generates revenue from the waste products it supplies to its petro-chemical neighbour. If that neighbouring plant closes down, the refinery will face a choice: either flare off the waste (and watch profits go up in smoke) or try to export it (and face cut-throat competition from the US). And a refinery with thinning profit margins is unlikely to prosper in a refining sector dogged globally by overcapacity. European refineries have been going down like ninepins as Asian and Middle Eastern refineries increase their market share.
These are facts of monopoly capitalist life in times of imperialist crisis. We need to understand these facts in order to understand the character of our enemy, and not pretend to ourselves that capitalism can be pressured into caring a fig about how, when or if millions of households in Scotland and the north of England are to be kept heated and lighted, let alone what standard of living its own workforce can expect to see going forward.
As Lalkar noted in an article back in 2008, “Ineos is not primarily an oil company at all, but rather a chemical business which has become the biggest company of its kind in the UK by the expedient of acquisitions and asset-stripping – as witness its annexation of Grangemouth from BP’s business empire in 2005. As the merger frenzy of imperialism intensifies, it matters less and less precisely what commodity is being produced, so long as the concentration of capital and capacity in ever fewer hands succeeds in stealing market share from rivals and screwing maximum surplus value out of the workforce. The absorption and gutting by Ineos of the unwanted operations of better-known corporate giants like BP, ICI, Unilever, Dow Chemicals and Union Carbide, using high yield bonds to finance the deals, has secured its place as the world’s third largest chemical company, employing over 16,000 workers in twenty different countries. It has an annual turnover of £22.6 billion.”
Unite informs us that the company’s sales have risen by over 50% in the past year, gross profits are up 20%, its operating profits are 56%, and it made a profit of £2bn last year. But the notion that Ineos could quite happily thrive on a marginally less obscene profit margin is just a comforting illusion. Such illusions are eagerly embraced by “left” social democracy, for they point in the direction of a reformist solution, requiring only a little regulatory tinkering. The reality however is that it is insufficient for the monopoly capitalist to make huge profits: he needs to make maximum profits – or face extinction at the hands of his no less ruthless competitors.
After the event, having signed up to what he describes as the “warts and all” agreement, McCluskey complains that ” We have a situation where a company has come along and has put down an ultimatum and we have to respond to the ultimatum. That’s not the way 21st century industrial relations should be conducted .” But that is the very essence of how crisis-period industrial relations are conducted, and rather than lament the fact it behoves unions to recognise that fact, raise their game and start conducting themselves less like auxiliaries of the Labour party and more like the organs of class resistance of which the working class are so sorely in need.
Break the link with Labour!