De La Rue has launched a consultation at its Gateshead Plant that could result in the loss of 170 jobs, with union Unite laying the blaming squarely on the company’s loss of its £490m UK passport contract.
The union said that that the Home Office's decision to award the £490m contract to print the post-Brexit blue passports to French firm Gemalto impacted De La Rue’s financial viability, which has led the UK firm to review its Gateshead operation.
The 170 "skilled printing jobs" that the union said were to be lost are related to the security print group’s foreign currency contracts. According to Unite, these cuts are in addition to a further 100 jobs related to passport printing that are expected to go in the autumn.
Unite national officer Louisa Bull said: “This is devastating news for the workforce, their families and also for the north east economy which can ill-afford to lose such skilled jobs.
“Unfortunately, there is a dearth of printing jobs across the region and the employment opportunities for those losing their jobs are few-and-far between. Most European countries regard the printing of passports as a national security matter which should be done in the home country.
“However, we have a government which prioritises a rigid adherence to a right-wing outsourcing agenda before maintaining skilled printing jobs in the north east and guaranteeing national security.”
About 200 workers will remain at the Gateshead plant once all the planned job cuts are undertaken, according to Unite.
Bull claimed De La Rue would likely look to place more contracts abroad where production is cheaper, such as at its Kenya and Sri Lanka plants.
She concluded: “The final distasteful irony is that Gemalto has now outsourced the printing of UK passports to a Polish firm.”
However, the Home Office and Gemalto declined to confirm to PrintWeek whether this would be the case or if Gemalto would be using its own plant in Tczew, Poland, to print the British passports.
De La Rue related the loss of jobs to a proposal to shut one of the print lines at the Gateshead plant and insisted it was “currently consulting with all parties concerned”.
“As the world’s largest commercial banknote printer, we regularly review our operational footprint to ensure it meets global demand,” a De La Rue spokesperson said.
“We are currently in the final stages of a footprint restructuring programme that was announced in 2015 to ensure our business continues to be competitive on a global scale.”
Concurrently, De La Rue announced further changes to its board following the confirmation last month that chief executive Martin Sutherland would depart following a process to find his replacement.
Senior independent director Andy Stevens will depart as his replacement is found, though no later than 31 December this year. He will be followed by chair Philip Rogerson, who will leave following the bedding in of Sutherland's replacement.
Upon announcing Sutherland’s decision last month, De La Rue issued a warning on profits that saw its shares fall by nearly 30%.