MPs reel at body blow to city’s economy

11:00am Thursday 31st July 2008

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MPS have branded Norwich Union’s announcement as “bad” and “disappointing” news for York – and urged the insurer to do its utmost to avoid compulsory redundancies.

Tory MP John Greenway, whose Ryedale constituency includes Monks Cross, where the jobs are going, said: “It certainly is bad news for York. It’s very disappointing news.”

But he said Norwich Union was still going through some very significant restructuring, and was working in an extremely competitive market.

Hugh Bayley, the Labour MP for York, said: “I want Norwich Union to do everything possible to avoid compulsory redundancies and redeploy staff to other Norwich Union jobs.

“This is bad news for the Norwich Union staff, who have my sympathies.”

He said he had spoken to management at length yesterday about the developments and it was clear that Norwich Union remained one of York’s biggest employers and was committed to the city.

He said he had been given figures showing the number of employees in York had risen over the last three years, despite redundancies in 2006.

The number had risen from 3,270 in May 2005 to 3,590 in May this year, he added.

Politicians urge action

CITY of York Council leader Andrew Waller has organised talks with Norwich Union directors to discover why so many jobs are leaving the city.

He told The Press: “Clearly for many hundreds of York residents this will now become an anxious period for them and I appreciate the human cost of news like this.

“The council will be seeking to find out from Norwich Union the reasons behind why so many jobs are being outsourced from the city.

“I have spoken with Carole Jones, human resources director at Norwich Union, to express my concerns on behalf of the city, and together with the council’s economic development managers, I have arranged to quickly meet with directors at Norwich Union to understand their new long-term plans for York.”

He said he appreciated strenuous efforts would be made to redeploy within Norwich Union many of those workers whose jobs are at risk, and a few might transfer to Glasgow or Basildon, in Essex.

“However, for those people who may be made redundant in 2009 as a result of these changes, the council will actively work with Norwich Union to help workers through Future Prospects, and the other high-quality training and education centres in the city, for which there is a successful track record in getting people back into work.”

The deputy leader of the council’s Labour group, Coun Ruth Potter, expressed her sympathy for workers losing their jobs.

“I’m saddened to hear this news,” she said. “Sudden loss of employment is obviously devastating for those workers involved.

“I would be particularly worried if these 500 jobs are in the low-paid service economy as redundancy will hit a lot of families particularly hard at this difficult economic time.

“It will be extremely difficult to replace these jobs, and we will be speaking with the council’s economic development unit to establish the full facts and find out what help can be given if there is no hope of Norwich Union’s decision being reconsidered.”

Coun Ian Gillies, Tory group leader, claimed the job losses were yet more evidence of the economic downturn, and the knock-on effect it was having on the local economy. It is a devastating blow for those involved, and together with the proposed cuts at HM Revenue and Customs, it will have a serious impact on the local economy,” he said.

“It is particularly disappointing that Norwich Union, having created a base at Monks Cross in the recent past is now moving the functions away from the city.

“We are living in uncertain times, and it makes it all the more important that the city has the robust and appropriate policies to encourage both private companies and public sector departments to locate their operations in the city.

“All parties need to work together in order to invest in the infrastructure to provide a broad-based, successful economic future, including both service and manufacturing sectors, to help withstand the present and future economic challenges.”