Grangemouth Reloaded

Ok, things at Grangemouth have gotten a little out of hand.

Whilst the reactionary will delight in blaming the unions for bringing down the company, Ineos may have beenpulling a twinkie at the refinery. The Grangemouth complex has been losing money for years. By confronting workers with a pay cut and prompting industrial action, the company has an excuse to divest themselves of a loss-making asset. I don’t feel too bad for the workers; I assume they can all take a holiday in their yachts.

There are a hundred facets to this story. I’ll be, perhaps obviously, looking at how this affects the case for Scottish independence. Whilst there is currently word that the plant could remain open, I’ll be working under the assumption it is closing. If it doesn’t, it’s business as usual and, hopefully, all the workers will find themselves with job security. If not, it’ll have repercussions for independence.

The first question is whether the refinery’s poor performance is due to some kind of flaw, essential or temporary in either the Scottish or UK economy, or in Ineos’s running of the facility. Sadly, Ineos’s website is down for maintenance at present, so looking at any financial statements or performance results released by the company isn’t possible at present. I assume that more information will come to light in the next few days, probably of the highly ambiguous kind that can support either conclusion.

Alex Salmond has an excellent opportunity to prove his (and therefore the SNP’s, and therefore Scotland’s) political clout in handling the closure. With David Cameron noticeably silent on the issue in today’s Prime Minister’s Questions, it looks like Grangemouth is very much a Scottish issue at present. Currently, Alex Salmond has said that a new buyer is a priority. If it is simply that Ineos has mismanaged the site, the First Minister showing the political, diplomatic and business savvy needed to negotiate a new owner and operator of the site will be a major coup for the Yes campaign.

However, if Ineos is correct (and I don’t doubt that they are), and Grangemouth is going to need a huge investment programme, this could make finding a buyer for the complex difficult. There is one buyer of last resort though, one that not many people would be happy to see take control of Grangemouth; the state. With even Conservative John Major advocating poltical intervention in the energy sector, the timing may be right for the government to take control of the ailing refinery. This article makes a good case for taking Grangemouth into public hands. Whilst I do appreciate the arguments in favour of privatised companies, anything so vital to Scottish economy that it produces 80% of the country’s oil should not be placed in the hands of one man or one company that is prepared to hold to ransom, not just the livelihood of 1,350 workers, but the fuel supplies of an entire nation.

If the government took over running Grangemouth, it would not just be safeguarding a strategically important asset, but it would be able to provide the investments Ineos says it needs. With the SNP talking about how wonderful a sovereign wealth fund for Scotland would be, having direct control over the the means of production would make it easier for them to implement this. Furthermore, they’d be able to silence most of the no campaign if they could take a struggling refinery and turn it into a profitable one, and then sell it at a profit to private company. This could also increase foreign investment into the country (assuming it was a foreign company buying Grangemouth), or create a national company with a strong asset to back forays into the international market.

I feel that the Grangemouth fiasco is only just developing in its relation to Scottish independence. Certainly, in the next month or so, it will be a major story to watch. But it’ll only be in the next year, easily by the referendum and even beyond that it will fully develop, and its significance to Scotland’s fate as an independent country will become apparent.

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