Memo points to EU yard 'cheats'

Unions fear UK yards are at a disadvantage

Shipbuilding unions say a leaked memo from the Italian Government proves that European yards are being subsidised by up to 25%.

They have called on the European competition commissioner to intervene or to allow Britain to do the same.

Jamie Webster, shop steward convener at the Govan shipyard on the Clyde, said it was time Britain stopped playing by the rules if everyone else was breaking them.

Jamie Webster: "Left out in the cold"

The memo is said to have come from the transport and navigation ministry in Italy.

It was leaked to an official of the GMB union and complained of unfair subsidies being given to yards in France, Denmark, Spain and Germany.

It said those countries were all providing tax relief of up to a quarter of shipyard costs, compared with a British limit of 9%.

Mr Webster believes the memo shows that British yards are being left out in the cold because they are abiding by the rules.

Ferry order

The revelations come as 3,000 workers at the BAE Systems yard in Govan await a decision by the Ministry of Defence on a vital ferry contract.

The bidding process for the contract was thrown into disarray earlier this year when it was revealed that a UK consortium was able to undercut the Govan yard by using German shipyards.

Local politicians and union officials complained about EU bidding rules which meant that the UK Government could not reserve some of the work for Govan.

Officials want the government to act

BAE Systems took over the Govan yard from Kvaerner after the original bid was submitted.

The MoD reopened the tender process on 9 June saying that "changed circumstances" had resulted in bids being revised.

Govan is part of the SeaLion consortium bidding for the work, which covers building the ferries then servicing them for 20 years.

Danish shipping group, Maersk, is a rival to SeaLion, but in a surprise twist, it offered the Clyde yard a chance to tender for the shipbuilding part of the contract.

An official announcement on which yard has won the contract will be made later in the year.