Brown urged to protect ailing engineering industry

British Chancellor Gordon Brown was today urged to act fast to protect Britain’s stricken manufacturing industry.

The Engineering Employers’ Federation is calling for the Chancellor to bring forward measures in his November pre-Budget statement to prevent further job losses and ease the pain for the sector.

The EEF said it was making the call after conducting a survey which showed the engineering sector was suffering worse conditions than during the last recession, from 1990 to 92.

EEF director general Martin Temple said: ‘‘We have not made this call lightly and we are not talking the situation down.

‘‘The figures speak for themselves. We cannot underline enough the severity of the situation facing our sector, where an already deteriorating situation has been exacerbated by the awful events in the US.

‘‘In addition to a further immediate cut in interest rates, there is now an urgent need for the Chancellor to bring forward measures, such as a reduction in employers’ national insurance contributions.

‘‘These would help to alleviate the situation facing many companies and prevent any further job losses.’’

The union is urging the Chancellor to pay urgent attention to ‘‘two particular areas of rising costs’’ the climate change levy and the problems for company pensions associated with the minimum funding requirement.

‘‘We also believe that a temporary reduction in employers’ national insurance implemented in the November pre-Budget would give a boost to business confidence and cashflow,’’ the union said.

The EEF said key findings of its report which covers the third quarter of 2001 were:

:: Engineering is forecast to contract this year by 2.5%, with growth set to recover by only 0.3% in 2002

:: Output, total new orders and export orders all worsened significantly

:: Capital investment was the worst for three years.

:: Employment has plummeted in the last six months with job losses in manufacturing this year expected to rise by 150,000. A further 164,000 are forecast to be lost in 2002.