COMMONS

Government should learn from Bombardier crisis to safeguard UK businesses

08 February 2018

The Northern Ireland Affairs Committee calls on the Government to consider Boeing’s recent actions, and the potential impact on Northern Ireland, when tendering future contracts, in its report into Bombardier.

US International Trade Commission (ITC) ruling

The report welcomes the International Trade Commission’s decision that ruled out high tariffs on Bombardier aircraft and urges the Government to take steps to prevent a repeat situation for UK businesses.

Boeing's complaint

In the ruling, published in January, the US International Trade Commission (ITC) stated that imports of Bombardier C-Series jets did not harm, or threaten to harm, the US domestic industry. Boeing had alleged that the aircraft was given an uncompetitive marketplace advantage due to subsidies from the UK and Canadian Governments. An earlier judgement in the case from the US Department of Commerce threatened to impose tariffs of 292%.

Government must continue to protect Bombardier’s Northern Ireland operations

The Government must maintain pressure on Boeing, who are yet to indicate if they will appeal the ITC decision. The Government must be proactive and continue to protect Bombardier’s Northern Ireland operations from punitive action. Existing Government contracts with Boeing should be reviewed and past behaviour taken into account when bidding takes place for future contracts.

Call for the Government to conduct audit

Detailed commentary on the ITC’s decision has not yet been made public. It is unclear whether the ITC considered UK and Canadian government support of Bombardier to be in contravention of WTO rules, and may have only ruled that Boeing did not suffer direct harm. In light of this, the Committee has called on the Government to conduct an audit of all Repayable Investment Loans it has made to UK companies and risk assessments made, particularly where companies have business in the US market.
 
The Committee praised the work done by so many to make the case for Bombardier, and support its staff, including the UK government, politicians throughout Northern Ireland and trade unions. These interventions were all the more important given the absence of the Executive. It is vital the UK Government continues to work with Bombardier, and partners including Invest NI and the Department for the Economy, to create the optimum conditions for the Airbus venture, and protect high skilled jobs in Northern Ireland.

Chair's comment

Committee Chair Dr Andrew Murrison MP commented:

"Thankfully the right decision has been made on punitive tariffs.  It’s such a relief for workers and the Northern Ireland economy but we are left wondering about the needless damage Boeing’s flimsy claims might have caused.

The Government must ensure that UK based businesses are watertight against such speculative action in the future,  UK workers cannot become collateral in disputes between multi-nationals.

When spurious complaints like Boeing’s can mean months of uncertainty for UK workers, the Government must be robust. If companies are willing to take action that directly harms the UK economy and, potentially, security they should expect a frosty reception when tendering for contracts.

Finally, a big well done to those who fought tirelessly to protect vital jobs in Northern Ireland."

Further information

Image: iStockphoto

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