The Courier & Advertiser (Perth and Perthshire Edition)
Extra Tay Cities money ruled out
Action group meets for first time in bid to save factory
Scottish Secretary David Mundell has ruled out increasing the UK Government’s contribution to the Tay Cities Deal as part of a rescue package for the Michelin factory in Dundee.
The tyre company announced last week that it plans to close the factory in 2020 with the loss of all 845 jobs.
It blamed the move on falling demand for 16-inch tyres and cheap imports from the Far East.
Although Michelin has said its decision is final, it is prepared to listen to proposals for retaining the site put forward by the action group.
The group, which includes Scottish Government Finance Minister Derek Mackay and Scottish Secretary David Mundell, met for the first time at DC Thomson’s Meadowside headquarters yesterday. It has three weeks to come up with a plan that will convince Michelin to keep the Baldovie factory open.
After the meeting, Mr Mackay again urged the UK Government to match the £200 million the Scottish Government is putting in to the Tay Cities Deal.
The UK Government is only contributing £150m to the deal, which will be officially signed on November 22.
Mr Mackay said: “We have an unprecedented opportunity to put a proposition to Michelin to stay.
“The UK Government and Scottish Government are working together but of course I’ve reinforced my call for the UK Government to match Scottish Government funding.
“We don’t want to give false hope or raise expectations beyond what is achievable but we’re working really hard to try to get the best outcome we can.”
Mr Mackay also said claims a rise in non-domestic rates contributed to Michelin’s decision were “a total red herring”.
But Mr Mundell said while “flexibility” would be part of the Tay Cities Deal, no additional money will be contributed by the UK Government.
He said: “The Tay Cities Deal is a freestanding commitment in the sense it’s a proposition pulled together to support the Dundee and wider Tayside economy.
“I want to make sure the deal as it currently stands takes into account all the circumstances surrounding the local economy.
“Our commitment remains to be part of this action group and whatever comes out of that.
“Michelin have left the door open for something to happen on that site. That proposition is separate from the Cities Deal, which will be in the terms previously announced other than making sure it has the flexibility to deal with changing circumstances.”
Mr Mundell denied the UK Government had short-changed the Tay Cities Deal and said the government had just invested £5m to support a “creative cluster” in Tayside.
He said: “It’s not a competition. The Scottish Government has different responsibilities to the UK Government.
He added that Scotland having higher taxes than the rest of the UK is “bad for business”.
Michelin have left the door open for something to happen on that site. DAVID MUNDELL