simmo
Senior Jockey
Still in denial? 
Good people of the North
- Thread starter Warbler
- Start date
The decision of Toyota to locate at Burnaston has been researched by many academic who the hope of trying to gain an understanding as to how Inward Investment decisions are made. It is universally accepted that Thatcher had little to do with it. The lead agency was Derbyshire County Council under the Labour leadership of David Bookbinder. Even the then local MP (Edwina Currie) who hated the man with passion, conceeds its the only good thing he ever did, (not true imo, but then as I said, the two couldn't stand each other).
Bookbinder sent his team on Japanese courses, got Derbyshire businesses with Japanese contacts to train staff in Japanese etiquette. He bribed the contractors conducting roadworks on the A38 on the day of the site visit to remove the cones and facilitate a conjestion free journey. He undertook to build a golf course for them (which has been cited as beign the critical component in the decision on quite a few occasions). He even offered some of the Derbyshire County Couyncil pension fund by way of a financial incentive
. This would be illegal now, and I'm not sure it wasn;t then. The offer remained on the table throughout discussions until such time as Toyota made their decision and thanked Bookbinder for the offer (goodwill gesture) but requested that he withdraw it, (on grounds of the fact that they as an MNE, had a few more shekels than he as a local authority).I wouldn't be so sure that's the case Clive. The 2000 Local Government Act contains something called 'The Power of Well Being' which replaced section 38 of the 1979 Local Government and Housing Act. It has been in place for quite a few years now and few locala uthorities have been prepared to invoke it. Why they haven't invoked I couldn't tell you, and its been the subject of a seperate and desperate government report that has implored local authorities to be more pro-active imaginative. My own theory is that local government is a hierarchical pyramid that only those at the tip of, can make such decision. However, as you rise through the strata the incentive to do anything imaginative and courageous reduces, as you can be held responsible for it. Therefore, those with the powers to make difference, have the greatest incentive not to invoke them. Instead they are happy to administer the machinary and grind it over at the slowest pace they can get away with in order to defend their salaries and pensions. Suffice to say, those in the middle strata grow very frustrated. Local Authority management and leaders would be keen to tell you they are powerless, I'm not so sure they are. 'Well being' is a very open piece of legislation and has deliberately been left so. The idea is to cut a lot of room for interpretation, and there have been a few imaginative uses of it. Indeed, I've invoked it myself (although clearly had to get it sanctioned) for what I regarded as a borderline case (I won't say what we did or name the authority, but our actions did survive a district audit!!!)
I reproduce the piece of legislation for your consideration and ask you why a local authority couldn't have used it?
2 Promotion of well-being
(1) Every local authority are to have power to do anything which they consider is likely to achieve any one or more of the following objects—
(a) the promotion or improvement of the economic well-being of their area,
(b) the promotion or improvement of the social well-being of their area, and
(c) the promotion or improvement of the environmental well-being of their area.
(2) The power under subsection (1) may be exercised in relation to or for the benefit of—
(a) the whole or any part of a local authority’s area, or
(b) all or any persons resident or present in a local authority’s area.
(3) In determining whether or how to exercise the power under subsection (1), a local authority must have regard to their strategy under section 4.
(4) The power under subsection (1) includes power for a local authority to—
(a) incur expenditure,
(b) give financial assistance to any person,
(c) enter into arrangements or agreements with any person,
(d) co-operate with, or facilitate or co-ordinate the activities of, any person,
(e) exercise on behalf of any person any functions of that person, and
(f) provide staff, goods, services or accommodation to any person.
(5) The power under subsection (1) includes power for a local authority to do anything in relation to, or for the benefit of, any person or area situated outside their area if they consider that it is likely to achieve any one or more of the objects in that subsection.
(6) Nothing in subsection (4) or (5) affects the generality of the power under subsection (1).
I acted under 4b incidentally !!!
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If the "acedemics" believe that the success was largely down to a local council leader...then i think they need to look again
He may have won against other UK regions, but the bigger factor was why they came to the UK in the first place. That is the point
I find it very hard to believe that Bookbinder was lobbying the japanese at that level
He may have won against other UK regions, but the bigger factor was why they came to the UK in the first place. That is the point
I find it very hard to believe that Bookbinder was lobbying the japanese at that level
My experience is that a lot of councils choose not to invoke it as it amounts to too much hard work. I recently briefed a Councillor to its existance for instance. The Head of Legal said it couldn't be applied. I said it could, and proceeded to give a whole list of examples where it had been. It became apparent that the Head of Legal wasn't familiar with it, and was confusing it with 'below best' (which requires Secretary of State approval to dispose of land below market value, if you perceive the wider economic benefits for doing so justify it). In the event the Head of Legal conceeded (probably having had to check the 2000 act - the most important piece of legislation that he should be able to recite off hand) that it could be used, but went on to say that I should not be broadcasting its existance in case Councillors wanted to start using it. It's symptomatic of the risk averse culture in management that I was maligning earlier.
Returning to Toyota. At the time 50% of Japanese FDI went to the UK. The reasons are many. In the first case the agency responsible at the time, as the first point of contact would have been the IBB (Invest in Britain Bureau) they're an off-shoot of the DTI, and their Tokyo desk was just about the best run off the lot. The EMDC (East Midlands Development Company) hadn't been established then, but they would later take lead responsibility until being absorbed by the Regional Development Agency, EMDA. Thatcher would have been briefed, but wouldn't have played much part in events, and in practical terms, less than Bookbinder.
One of the principle things behind any Japanese investment is their need for JIT manufacture. It tends to be the case that when you get a critical amount of investment, future investment flows by way of clusters based around 2 hour isochrones (Telford and South wales have benefited thus). With other manufacturers having already established themselves in the UK, I wouldn't under-estimate the influence that the Japanese business network had.
Also of paramount importance to them is the English language, and what they believe to be a common culture. They think we're a nation of civilised people, and I've certainly had the conversation with plenty of Japanese business people who like the fact that we're both island races with independent thought, (don't ask me, it makes no sense either).
Japanese investment (unlike American) is much less inclined to accept financial incentives, (in some cases it can even be taken as a corporate offence). They also have a willingness to invest in non-traditional areas of manufacturing provided the transferable skills are there. It is one of the reasons why our own LSC's and TEC's before them have rarely been able to persuade them to take any training packages. The Japanese conduct their own, training and culturalisation of a workforce (Nipponisation) and don't really want a workforce with engrained ideas and ways of doing things. Derby had an engineering base in Rolls Royce and the then BREL (now owned by the French). Sunderland had an engineering base of sorts in the legacy of ship building.
Again, unlike the Americans, a unionised workforce is not regarded as a deterent, the only thing they tend to insist on is a single union to deal with. The Japanese are confident that they can positively engage a trade union productively and are also happy that they pay well in return for commitment and good terms and conditions. The union isn't seen as a source of confrontation but rather as a valued partner in the development of the product and process. In that respect Thatchers union bashing legislation would have been of little value, but the labour market flexibility which the Japanese do value, would have been.
The UK was always the favoured location, and I wouldn't under-estimate the value of own domestic market to them either. Germany, France and Italy tend to purchase cars manufactured by their own. We are more likely to buy foreign cars (well we have to now!!!). The precise decision to go to Burnaston obviously involved things such as suitable site, good labour, communications (all the usual things) etc, but there's always a short-list of places who can offer all these primary considerations. In order to be the 'first amongst equals' you normally need to establish an advantage in the list of secondary considerations, and this is where Derbyshire forged ahead with it's golf course, and the perception that they really, really, wanted Toyota and were prepared to do anything to secure them. In many respects it is a perfect example of a local authority interveneing aggresively in support of its local economic development, (remember the area was ex-mining and recently suffered at the hands of Thatcher). They needed a new apex employer who could under-write their economy for the next 25 years, and I say fair play to Bookbinder for going the extra mile.
For the record, Bookbinder was fined £38,000 by the then EEC for breaching their regulations in securing Toyota. I suspect he paid with a smile on his face
As the EEC hardly had the right, nor clout to turn round and ban Toyota from the continent. In truth, Toyota could have paid it for him and simply said we're going to Derbyshire anyway, and unless you want to advertise Europe as a no go Jap zone, I suggest you shut up
Returning to Toyota. At the time 50% of Japanese FDI went to the UK. The reasons are many. In the first case the agency responsible at the time, as the first point of contact would have been the IBB (Invest in Britain Bureau) they're an off-shoot of the DTI, and their Tokyo desk was just about the best run off the lot. The EMDC (East Midlands Development Company) hadn't been established then, but they would later take lead responsibility until being absorbed by the Regional Development Agency, EMDA. Thatcher would have been briefed, but wouldn't have played much part in events, and in practical terms, less than Bookbinder.
One of the principle things behind any Japanese investment is their need for JIT manufacture. It tends to be the case that when you get a critical amount of investment, future investment flows by way of clusters based around 2 hour isochrones (Telford and South wales have benefited thus). With other manufacturers having already established themselves in the UK, I wouldn't under-estimate the influence that the Japanese business network had.
Also of paramount importance to them is the English language, and what they believe to be a common culture. They think we're a nation of civilised people, and I've certainly had the conversation with plenty of Japanese business people who like the fact that we're both island races with independent thought, (don't ask me, it makes no sense either).
Japanese investment (unlike American) is much less inclined to accept financial incentives, (in some cases it can even be taken as a corporate offence). They also have a willingness to invest in non-traditional areas of manufacturing provided the transferable skills are there. It is one of the reasons why our own LSC's and TEC's before them have rarely been able to persuade them to take any training packages. The Japanese conduct their own, training and culturalisation of a workforce (Nipponisation) and don't really want a workforce with engrained ideas and ways of doing things. Derby had an engineering base in Rolls Royce and the then BREL (now owned by the French). Sunderland had an engineering base of sorts in the legacy of ship building.
Again, unlike the Americans, a unionised workforce is not regarded as a deterent, the only thing they tend to insist on is a single union to deal with. The Japanese are confident that they can positively engage a trade union productively and are also happy that they pay well in return for commitment and good terms and conditions. The union isn't seen as a source of confrontation but rather as a valued partner in the development of the product and process. In that respect Thatchers union bashing legislation would have been of little value, but the labour market flexibility which the Japanese do value, would have been.
The UK was always the favoured location, and I wouldn't under-estimate the value of own domestic market to them either. Germany, France and Italy tend to purchase cars manufactured by their own. We are more likely to buy foreign cars (well we have to now!!!). The precise decision to go to Burnaston obviously involved things such as suitable site, good labour, communications (all the usual things) etc, but there's always a short-list of places who can offer all these primary considerations. In order to be the 'first amongst equals' you normally need to establish an advantage in the list of secondary considerations, and this is where Derbyshire forged ahead with it's golf course, and the perception that they really, really, wanted Toyota and were prepared to do anything to secure them. In many respects it is a perfect example of a local authority interveneing aggresively in support of its local economic development, (remember the area was ex-mining and recently suffered at the hands of Thatcher). They needed a new apex employer who could under-write their economy for the next 25 years, and I say fair play to Bookbinder for going the extra mile.
For the record, Bookbinder was fined £38,000 by the then EEC for breaching their regulations in securing Toyota. I suspect he paid with a smile on his face
As the EEC hardly had the right, nor clout to turn round and ban Toyota from the continent. In truth, Toyota could have paid it for him and simply said we're going to Derbyshire anyway, and unless you want to advertise Europe as a no go Jap zone, I suggest you shut upOk..Havent read all of this yet
But ...Thatcher "bashed" unions that were often little moe than confrontrational. As Scargill and the Red Robbos of this world admitted themselves, their objectives were more than simply those of of the workfiorce. The Japanese would not have come near Derby with those sort of attitudes in place
They are the same workers but they have new clean safe workplace to work in Thatcher wrecked the country thats why the ones with get up and go got up and went, we now have Romanians street robers old folk not safe in there own homes don't telll me we are better off she couldent give a dam her arms deeling son should be locked up as well it,s not north and south it's rich and poor
Honest Tom
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