Diageo 'must explain decision to Scottish workers'

The chief executive of Diageo was challenged to explain directly to workers why the company rejected Scottish government-backed plans aimed at saving hundreds of whisky jobs.

Paul Walsh, chief executive of the drinks giant which also makes Guinness, was last night urged to visit the Johnnie Walker bottling plant in Kilmarnock and explain his firm's decision to the 700 workers there who are now likely to lose their jobs.

It comes after Diageo announced that it is pressing ahead with its plan to close the Kilmarnock plant and the Port Dundas grain distillery in Glasgow.

That decision may lead to a total of 900 redundancies at the sites.

Yesterday, Diageo dismissed alternative business proposals which would have seen work continue in Port Dundas and a new bottling plant created in Kilmarnock.

David Gosnell, managing director of Diageo Global Supply, said: "We examined the alternative proposals thoroughly. They don't deliver a business model that would be good for either Diageo or Scotland."

However Kilmarnock SNP MSP Willie Coffey - who has campaigned against the closure plan - said: "Paul Walsh must come to Kilmarnock, face the 700 employees he is making redundant and explain why he is sacrificing their loyalty and the brand's history.

"For Diageo to walk away from us after 189 years is just shocking and totally unjustified."

A massive cross-party campaign was mounted to try to persuade Diageo to rethink its proposal, with Scottish First Minister Alex Salmond attending a 20,000-strong demonstration through Kilmarnock.

Less than a week ago Scottish Finance Secretary John Swinney presented Diageo with details of alternative proposals, which were drawn up by a taskforce comprising politicians, trade unions, local councils and Scottish Enterprise.

Mr Swinney said the decision to reject those proposals was "deeply disappointing".

The taskforce had "put together the strongest arguments and substantive proposals to retain production and jobs at Port Dundas and Kilmarnock", Mr Swinney said.

"I still do not believe that Diageo appreciate the social consequences of their financial decision in turning their backs on 200 years of history in Port Dundas and Kilmarnock."

Meanwhile, Des Browne, the former Scottish Secretary and the MP for Kilmarnock and Loudoun, described Diageo's decision as a "massive blow to the people of Kilmarnock and the whole of the West of Scotland".

Mr Browne said: "This will devastate and decimate the town. It will ruin families, ruin lives, ruin people's futures."

He said he is now seeking an early meeting with Mr Swinney to find out what happened in negotiations with the company, but he added: "The first task is to do everything we can to rescue the town of Kilmarnock from the black cloud that has been cast over it today."

Harry Donaldson, of the GMB trade union, said he was "shocked" by Diageo's decision.

"We are meeting the company (this morning), at which point we would hope to convince them that they need to think again," he said.

"If they do not, there will be 900 job losses at the plant in Port Dundas, Glasgow, and at Johnnie Walker in Kilmarnock."

Mr Gosnell said: "We need a sustainable Scottish operation that supports our international spirits business and provides a future for the 4,000 people we would employ in Scotland after this restructuring is completed.

"I appreciate their efforts but the taskforce has no workable alternative to deliver what Diageo needs."

The company said it has three key reasons why it had rejected the taskforce's proposals.

It claimed the plans would still leave "inefficiencies" and that one alternative model presented no other option than delaying the closure of the Port Dundas site.

The firm also claimed the alternative plans would still have meant a net loss of around 500 jobs.

The drinks giant has already claimed that the redundancies in Kilmarnock and Glasgow will be "offset" by the creation of 400 jobs at its packaging plant in Fife.

Bryan Donaghey, managing director of Diageo Scotland, said the company is now focusing on "consultation" with employees.

"I fully appreciate that the decision that we cannot take forward an alternative will be another blow to their hopes but I believe we now need to continue our engagement with our employees and their unions about how we move forward from here," he said.

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