Pfizer: did politicians know? And why under-fire Southeastern could get its extension

Pfizer: did politicians know? And why under-fire Southeastern could get its extension

by Paul on Politics, by political editor Paul Francis Wednesday, February 2 2011

After the devastating news about Pfizer closing its plant in Kent, there has inevitably been speculation about whether ministers were privy to the announcement before it was made. Business minister David Willetts said today that the government was told 'a few days before' in a briefing with the company and immediately set about asking if there was something the government might do to change its mind.

That does rather suggest that it was as much as a shock to the government as it has been to everyone else. That incidentally, includes Kent County Council.

The question then becomes whether the government's radar was adrift on what was happening in the wider pharmaceutical industry and should - could - have been more pro-active.

Labour is suggesting - rather inevitably - that ministers ought to have been in the loop and should have been making efforts to encourage Pfizer to stay put. That may be rather over-estimating the influence and leverage governments have when it comes to persuading global corporations faced with a contracting market in a recession to bend to their will.

One other consequence of Pfizer's decision is that it raises a serious question about the government's central contention that job losses in the public sector will be absorbed by growth in the private sector - especially in the context of expected job losses of 1,500 at KCC and many others in the county's public sector.

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I am getting the distinct impression that for all its faults and the opproprium heaped on it by disgruntled passengers, the odds on Southeastern being offered a two-year extension to its contract are growing.

Despite the admirable efforts by Kent MPs to pile pressure on the government to do otherwise, it seems ministers are in a legal bind that would make it extremely difficult to go against the conclusions of its 'continuation review' and it appears likely that Southeastern may be on course to meet the required thresholds - notwithstanding the many complaints from its passengers.

The government will be extremely wary of exposing itself to any kind of legal action from Southeastern were it to go against the review and the possibility of handing out compensation to the company.

Of course, ministers will be able to blame the previous government for laying down the franchise rules that place them in an awkward position but I very much doubt that will appease Southeastern's long-suffering users or the county's equally frustrated MPs.

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Categories: National Politics | Politics

Comments

Wednesday, February 2 2011 #

Chris Fribbins

Could there also be a connection betwwen Pfizer's closure and Southeastern. Since December 2009 the rail connectivity to and from London has been degraded and the Highspeed serice does not stop at Sandwich (also Deal). Would such connectivity make that location more attractive (for Pfizer and any new businesses that coould be interested in moving in).

The legal contractual reasons to prevent an 'automatic' 2 year extension are around financial grounds and not performance.

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Paul on Politics, by political editor Paul Francis

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