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					                       MG ROVER TASK FORCE

Final Update Report : THE WORK GOES ON




Prepared for Submission to the
Department of Trade and
Industry




                                   March 2006
                                                               MG Rover Task Force Report


FOREWORD Nick Paul
The MG Rover Task Force met for the final time on 21st February 2006.
Established for a fixed term of nine months by the Secretary of State for Trade and
Industry to deliver the national response to MG Rover‟s closure, the Task Force leaves a
legacy of achievements and lessons learnt and with work in progress to help more
people back into jobs, to support supply chain companies and to secure a sustainable
and prosperous future for the area of Birmingham worst affected by the closure.

The tragic closure of MG Rover will live long in the memory. But I hope that 2005 will not
only be remembered for its closure. I believe 2005 should also be remembered for the
positive way in which the West Midlands region responded to it and has moved on.

We have set the benchmark for how a region should respond in the event of a major
industrial closure. The fortitude of MG Rover‟s workforce, the resilience of its supply
chain, combined with a co-ordinated and speedy response from Government has
prevented long-term damage to our regional economy.

At a time of great worry and uncertainty for former workers and their families, the Task
Force sought to take at least some of the worry away. Jobs and benefits advice was
immediately available on-line and in brochures, and all workers were able to begin their
claims for Jobseekers Allowance within a week.

As quickly as possible workers had their redundancy payments and peace of mind that a
substantial part of their pension would be protected. Job matching and training courses
began within weeks.

Many of the workers had never experienced redundancy before, and the disorientating
effects it can have. Some undoubtedly found the speed with which support arrived head
spinning, but we were determined not to let the situation to drift and people fall through
the support net. All the measures we took were to ease the path back into work.

Where they wanted to stay in manufacturing, we tried to match them to jobs with more
than 750 people helped so far. Where they wanted to try something new, and acquire
new skills, we did our level best to meet their requests and provide the right training
courses which to date have helped more than 1,000 people into work. We were also
able to provide help with travelling expenses in a range of cases.

Overall, our support and the determined attitude of former workers means that - at the
time of writing – over 4,000 workers are back in jobs, with around 100 people a week
finding work since April 2005.

This is a momentum we want to maintain. Although the Task Force ends, we will not cut
and run – we have no intention of ignoring the remaining workers still out of work. Whilst
many are still on training courses and others are experiencing difficulties in getting into
work, we are under no illusions that we are now entering the most difficult phase.

We are working on, and about to launch a new programme of support which will provide
intensive support to the remaining 1850 people who need this additional help to
overcome barriers to employment.


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Whilst the main focus of media attention was on the thousands made redundant at
Longbridge, the Task Force was clear that equally profound and devastating job losses
were threatened in the MG Rover supply chain.

As with the Longbridge workforce, we had to act quickly to support companies who
overnight lost thousands of pounds worth of business. Our main concern was that a
knee jerk reaction amongst suppliers would see dozens of companies close with
thousands of people out of work.

We estimate that eleven supply chain companies closed – far fewer than anticipated.
The support companies received from the previous Rover Task Force to diversify away
from Rover in 2000, together with support from the current Task Force which
safeguarded more than 1,300 jobs, kept company closures and job losses to a minimum.
The more limited impact also demonstrates that the West Midlands region has a more
robust manufacturing sector than perhaps some would give us credit for.

But as with former workers, the work of the Task Force goes on with a new programme
of support for suppliers to start this year which will help improve their innovativeness,
their products and processes and in turn improve their competitiveness.

Much of the economic impact of MG Rover‟s closure is concentrated in and around the
Longbridge plant. The workforce was drawn predominantly from this area and those still
out of work will be the first to benefit from our intensive programme of support mentioned
earlier.

However, there are the longer-term effects that the loss of a major employer has on a
local community – the skills and employment prospects of young people, the eyesore of
a largely derelict site, the impact on local retailers.

We have to guard against a spiral of decline where young people perceive that there are
little or no prospects for them now that a major employer has gone and many people of a
working age are jobless. It is important to act now and put in place long-term measures –
such as the proposed 14-19 Vocational Centre - that target future generations and
ensure they are equipped with the skills they need to find jobs – including on the
Longbridge site.

Over the next few months, there is no magic wand that can be waved to transform the
area. However, the Task Force is determined that the hole left by MG Rover‟s closure
can be turned into a major economic opportunity.

Over the long-term, the redevelopment of Longbridge offers a once in a lifetime
opportunity to make South West Birmingham an area of high value jobs and real
economic growth. The three local authorities who have a part of the site within their
boundaries, Advantage West Midlands and the landowners St Modwen‟s are now
working on plans to make sure the site has the right mix of development and so be the
catalyst for the regeneration of the wider community.

In summary, a lot has been achieved by the MG Rover Task Force since April 2005, but
there remains a lot still to be done. Although the Task Force comes to an end, the work
goes on to help those who still need it.


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The success of the Task Force and the overall regional response is down to the efforts
of many people and organisations – from central Government all the way down to the
staff at Jobcentre Plus and community call centres who were in the frontline and
providing the face to face support people badly needed.

It has been a monumental effort by all involved. There were the sceptics who doubted
that a public sector led response would provide the effective support necessary to stave
off the worst effects of the MG Rover‟s closure. I believe we have proved those doubters
wrong.

We have shown ourselves to be speedy in our response and imaginative and flexible in
dealing with problems as and when they arose. And we have provided Government with
an invaluable evidence base and a series of recommendations so that in future every
region can deliver an effective response if anything on this scale happens again.




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Contents
                                                                                          Page No



 1. Introduction & Executive Summary                                                        6

 Part 1: Update of Work in Progress

 2. Employee Support – Update                                                               10

 3. Supplier Support - Update                                                               15

 Part 2 - Future Actions 2006-2008

 4. Transition process                                                                      17

 5. Supplier Support – Phase 2 - Longer Term                                                19

 6. SW Birmingham Growth & Support                                                          22

        6.1 Investing for Transformation                                                    22

        6.2 Longbridge Site Development                                                     23

        6.3 SW Birmingham Community Support Programme                                       25

        6.4 Longer Term Skills Development                                                  27

 List of Appendices:

       1. Finance Summary                                                                   29

       2. List of Associated Reports                                                        31

       3. Longitudinal Study Tables                                                         32




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1.0 Introduction and Executive Summary

In our previous „Six months On‟ report, issued in November 2005, we reported on the
consolidation of the initiatives, commencement of major projects, and updated
achievements, but also took a more reflective look on what was done and, with
hindsight, if it could have been done better. From the lessons learned the Task Force
was able to compile 15 policy recommendations to Government for review, including a
set of operational response suggestions for any future major business closures.

This is the final report of the MG Rover Task Force. It is in two parts. Firstly, it provides
an update on the work currently in progress which was outlined in the comprehensive
November report.

The second part looks forward to new initiatives conceived by the Task Force but
delivered by Birmingham City Council, Jobcentre Plus, the Learning and Skills Council,
Advantage West Midlands, and Birmingham Chamber of Commerce and other
Government Agencies. It also explains how the progress of this work will be monitored
by an Executive Steering Group made up of members of the Task Force.

A more comprehensive description of the activities mentioned below, and of others not
mentioned, is given in later chapters.

PART ONE: WORK IN PROGRESS

From the beginning the Task Force focused on three areas that were identified as crucial
for the prospects for individuals and the economy: employees, MG Rover suppliers, and
local communities.

Employees
Priority was to get ex-workers back into the jobs market as quickly as possible.
Benefits and redundancy payments, pension protection and company car concerns were
rapidly dealt with so that workers could concentrate on identifying the right jobs
vacancies or training courses for them.

          To date Jobcentre Plus has taken claims from nearly 6,300 individuals
           relating to former MG Rover and supply chain workers.
          Over 4,000 individuals are now back in work (63%)
          1,600 have been placed into work as a direct result of the MG Rover Hotline
           and the Cannon Hill Park Jobsfair.
          Throughout the Task Force campaign so far, the average rate of individuals
           getting back to work has been around 100 per week
          Over 4,000 people have completed an individual skills advice session to
           develop their own Individual Training Plan
          Over 2,000 people have undertaken some form of individual assessment
           and/or training provision.
          1,000 of those now in work received training through LSC. 79% of those
           currently in training believe their training will help them get a job


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             Over 30 people have started higher education courses at one of the regional
              universities
             a Manufacturing Hub formed to match manufacturing workers to jobs in the
              sector – 750 people have found jobs through the Hub
             None of the original 88 MG Rover apprentices are now seeking placement
              assistance.

Supplier Companies
The Wage Replacement Scheme paid participating companies £50 per day for up to six
weeks for employees whose job was reliant on MG Rover, but might potentially be
saved, to encourage employee retention. Companies in MG Rover‟s supply chain could
overcome immediate cash flow problems, deferring tax liability on bad debts or applying
to a loan fund.

             Mainly as a result of interventions since the Rover crisis of 2000 and following
              MG Rover‟s closure, supply chain company closures have been limited to 11,
              from the 150 or so located in and around the West Midlands and the 350 total
              nationwide.
             170 companies took up the Wage Replacement Scheme. Funding of £3.4
              million helped retain 1329 jobs
             VAT/PAYE/NI deferrals amounted to £12 million and helped 106 companies
             The Transition Loan Fund assisted 17 companies with approved loans
              totalling £5m so far, and further assessments are in the pipeline for company
              transitions into new business plans.

Community
In the local community, a network of advice centres provided support to former workers
and their families:

            6922 clients interviewed and supported by Birmingham Council‟s
             Neighbourhood Advice and Information Service – including family members
             and others affected from other Local Authority areas.

            The Debt Advice Team has delivered 227 hours of work, averaging 6.1 hours
             per client. 35% of clients are from outside the Birmingham boundary.

PART TWO: THE FUTURE
In recent months, the Task Force has been building for the future, based on the lessons
learned. These responses are being put in place now, and will provide longer-term
solutions to tackle barriers to work for those former workers still unemployed, to support
competitiveness in the supply chain and to develop South West Birmingham into an
engine of economic growth.

Employees
The new Employment Support Package addresses barriers to employment and work to
move former MG Rover workers and potentially in the future SW Birmingham residents
into sustainable employment. The support package brings together services currently
delivered by Jobcentre Plus, LSC, local colleges, other providers, and Birmingham City
Council.



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After June 06, a one stop shop in Northfield will offer intensive personalised support
around job search, training and interview techniques and be combined with travel and
childcare support to up to 1,000 former workers. This will give individuals the maximum
chance of obtaining sustained employment by developing the skills to apply for
advertised vacancies and make effective direct approaches to companies.

Supplier Companies
As part of the longer-term approach, programmes are being developed which focus on
increasing the number of businesses which are truly globally competitive. These
programmes are focussing on the productivity of complete supply chains as well as
capability in new product development and design.

      A Productivity Alliance designed to close the productivity gap through sustainable
       dissemination of best practice. It will be aimed at approximately 50 medium-to-
       large automotive companies in its pilot phase, mainly Tier 1 and Tier 2 suppliers.
       It will produce significant improvements in quality, cost and delivery measures
       and in the long-term capability of these companies and their supply chains.

      A Business Support Programme (based upon established best practice) which
       will focus on supporting approximately 100 small-to-medium automotive
       companies to penetrate new markets, develop new products and win new
       business by improving their competitiveness.

      An Innovation – Technology Programme which under the guidance of the
       Innovation and Technology Council has been developed to set up a series of
       Centres of Excellence. These will cover areas such as electronics reliability,
       conceptual design for niche vehicles( in partnership with Coventry University),
       and developments moving forward from the current Premium Automotive
       Research and Development programme (in partnership with Warwick University
       Manufacturing Group).

South West Birmingham - Investing for Transformation:

Birmingham City Council are chairing the co-ordinating forum of Government agency
partners to drive forward an ambitious programme of transformation specifically in South
West Birmingham. This will be delivered through the best use of public assets to trigger
private investment in partnerships, developments and joint ventures.

A Prospectus will be developed by this group which will include three key elements to
continue the work done through the Task Force, namely; the regeneration of the largest
development site in the region – the Longbridge plant; the short to medium term
community support programme; and longer term development of the skills of the
community matched to available employment opportunities.

Longbridge Factory Site
The three local authorities involved, together with landowners Advantage West Midlands
and St Modwen‟s, are drawing up a master plan for the Longbridge site, to include
improved transport access for a mixed-use site amongst which will be high value
employment. The intention is for the site to be a catalyst for economic growth for the
surrounding South West Birmingham area.


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Community Support Programme
Community work will emphasise maintaining the confidence of families and individuals in
the most affected areas, and notably the area around Longbridge itself. This will include
work with young people, as well as debt advice and specific neighbourhood work, and
assistance to local businesses.

A key element of this programme is the Employment Support Package to address
barriers to employment and work to help unemployed former MG Rover workers and SW
Birmingham residents move into sustainable employment. The support package brings
together services currently delivered by Jobcentre Plus, LSC, local colleges, other
providers, and Birmingham City Council.

Existing services will be offered under a “one-stop shop” approach where possible. This
will deliver an individually focused package of support services meeting specific needs
including job search and learning support, travel costs, financial management advice,
and childcare.

Longer term skills development
Vocational training provision for 14-19s is the first element of this plan. Attention will also
be paid to developing skills for the future amongst the residents. The Learning and Skills
Council have secured European funding to continue longer term training for the
community as a result of the MG Rover closure and will lead on these provisions to give
focus on business demands.




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Part 1 - Update on Work in Progress

2.0 Employee Support - Update
BACK TO WORK – keeping up the momentum
Throughout the Task Force campaign so far, the average rate of MG Rover and supply
chain employees getting back to work has been around 100/week during the 9 month
period (May to January inclusive). This is illustrated in the Fig 1 below.

Fig 1 - „Stacked‟ graph of MG Rover and supply chain „back to work‟ history.
                                                BACK TO EMPLOYMENT PROGRESS

                7000

                6000                                 MGR Non Claimants
                                                                                            Total claimants 6271

                5000     5107
                                                                                         Total in new jobs 4000
    Employees




                                                                             Ex claimants destination
                4000            MGR & supply chain                           unknown (443)
                                    claimants      Supply chain workers in
                3000               unemployed              new job


                2000
                                                                                            MGR Workers in
                                                                                               new job
                1000

                   0
                  April / May      June       July     August    September   October    November   December       January   February

                                                                         Months

*Employment statistics from Jobcentre Plus as at 14 February 2006
At the time of writing, a total of 4000 people are back in work out of 6271 former MG
Rover and supply chain workers who claimed Jobseekers Allowance. Over ninety per
cent of those in work are in full-time jobs and the majority see their new career as long-
term even though just over half are earning less than at MG Rover. Nearly a quarter are
actually earning more. The number of those who have to travel further to their new job is
only slightly higher than the number of people who have found work closer to home.1
The back to work rate took a slight dip over the Christmas period but it is anticipated that
the rate will pick up again as employees complete training courses, and the new
initiatives for those experiencing particular problems with barriers to re-employment



1
 Taken from draft interim results from a Task Force commissioned study by Vector Research on the
employment destination of MG Rover employees - January 2006, to be published later in 2006.


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begin. Jobcentre Plus, the Learning Skills Council and the Local Authorities will continue
all endeavours to keep up this pace of return to work.

BACK TO WORK - through training
One of the cornerstones of the Task Force rapid response to the training needs of MG
Rover employees was the Service Level Agreement forged between Jobcentre Plus and
the Learning Skills Council to deliver a variety of vocational courses, both long and short
term, as the path to new employment.
The latest analysis of total MG Rover and supply chain employees back in work and
processed through training is summarised in the following table:
 DATA Description                           *Jobcentre Plus/LSC  People % of
                                                              Data update issue 14 Feb 06                                Claims
 Total MG Rover and supply chain benefit claims held by Jobcentre          6271
 Plus
 THOSE IN WORK:
 Number now in work where no training received                             2863
 Number now in work where training has been received                       1111
 (57% of those who have had training are now working)
 Total Individuals now in work                                            39742 63%
 THOSE NOT IN WORK:
 Number currently in training                                            365
 Number awaiting training (230 have start dates)                         302
 Total of individuals in or awaiting training                               667
 (1946* have received training in total, 473 their full training
 entitlement)
 Number who have trained and currently not working                          398
 (includes part trained)
 Number currently not working but have not requested or followed up         530
 on available training options. (200 have had Training Plans)
 All other Benefit leavers with no known destination (being tracked)        443
 Number who have claimed alternative benefit after claim for JSA            259
 Total Individuals not in work                                             2297 37%
 Total claims                                                            6271
*One day assessment/try-out courses are not counted in the above analysis.
** This table contains registered data and does not relate to the survey data (based on a
sample) in Appendix 3.

In all, partnership working between Jobcentre Plus and Learning Skills Council led to
1963 starts on training courses. A total of 1,854 are still registered and claiming
Jobseekers, training, and other benefit allowances, including the 530 that have not yet
agreed a training plan, and this group will be targeted for a new „Working for Jobs‟
package of support developed by Jobcentre Plus and LSC, and being marketed in the
SW Birmingham region to provide further services to assist people into employment.
This package is detailed in Section 6.3


2
    By 24 February 06, ‘individuals now in work’ had increased to 4029, hence a nominal 4000 quoted within this report




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BACK TO WORK - tracking destinations
Jobcentre Plus and the LSC have worked very hard to provide a new integrated data
base from their two or more discrete systems to provide a clear picture of individuals
moving into employment and the links between training and work.
Beyond this, the Task Force felt it would be useful for future intervention plans on mass
redundancies to understand the likely destinations into new employment by job quality,
sector, location, etc. Led by Jobcentre Plus and LSC, Vector Research has been
commissioned to undertake a long term „Longitudinal Study‟ for this which will be
completed later in 2006. To start with, a telephone survey of 570 former employees was
made, and some of the initial interpretation of results, mostly derived from reference to
the sample Figures and Tables included in Appendix 3, are highlighted as follows.
For example:
Of those in work: 91% are in full time or self employment, with 62% being in full time
permanent positions. Only 9% are in part-time work (refer Fig 1). Depending on job type,
between half and two thirds are in jobs they are settled into new jobs as opposed to stop
gap jobs (Table 4), and there is more or less a 50/50 split in those who are working
further from or nearer to work.

Although in Table 1 the survey indicates that 23% of overall respondents are actually
earning more in terms of salary, it also indicates that over 50% of respondents overall
are now earning a lot less than they had been at MG Rover, particularly those in the
£15k - £25k range (60%).

In terms of quality of job it seems approximately two thirds of those who were formerly in
either Managerial or Professional roles or Process or elementary roles have found
employment in the same kind of roles, and notably over a third of Administration or
Customer Service roles are now in Management or Professional roles. The most striking
change in occupational roles is that over half of those who were formerly in Skilled
Trades roles have found employment in Process or Elementary roles (Table 2).

BACK TO WORK - in Manufacturing and Engineering

One major issue was to avoid the potential loss of manufacturing and engineering
expertise within the East and West Midlands as a result of the closure of MG Rover.
Partly as a result of the initiatives such as the Skills Hub detailed below, approximately
40% of those who have found work were still working within manufacturing. (Refer to
Table 3 in Appendix 3)

The Manufacturing and Engineering Hub or „Skills Hub‟ was established in order to
address this drift and is the major part of the MG Rover Training Support Programme
(£4.4m) running on through 2006/7which has on offer:
    a travel subsidy up to £75/week for up to 20 weeks
    minimum NVQ2 training for employee plus one other from host employer
    wage induction subsidy to employer £50/wk for 12 weeks.

Jobcentre Plus delivers the recruitment and front face of the programme from its regional
office, whereas the LSC delivers the skills element of the package, and administration of




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payments. This service has had a significant impact in helping ex-MG Rover workers
obtain new employment, and immediate job offers with training and travel subsidies.

To date 751 individuals have gained new jobs through the Hub. 75% of these people are
receiving training and/or travel support. Notable employers are BMW, Rolls Royce,
Toyota and Bentley, although the scheme supports a wide range of manufacturing
companies outside of the motor industry, 20% of all individuals placed into new work
have returned to alternative car manufacturing companies.

The Hub has also been the focal point for a number of customised training programmes
funded by LSC aimed at former MG Rover and supply chain workers. This has included
collaborative contact by LSC/Jobcentre Plus with:
      2 major recruitment exercises aimed at the rail network and training for Personal
        Track Safety Certificates. 70 individuals are now working in this sector as a
        result
      A major bus company in the West Midlands to reserve spaces for former MG
        Rover workers for their driver training. To date 40 individuals have expressed
        interest in the recruitment exercise with more to commence in February.
      The Automotive Academy to secure 100+ vacancies in the automotive industry.
        A 15-week training programme leading to a manufacturing qualification and
        potential employment is planned.

Jobcentre Plus Hub staff have assisted EPM Technology (composite body shell
production on Longbridge site) in the sifting, screening and interviewing of managerial
staff. Up to 200 Production staff will be recruited during 2006.


BACK TO WORK - we’re not stopping!

Major efforts are still being made to assist those still unemployed by continuation of the
many initiatives as listed below:
    Special LSC Training entitlement up to £2500 per employee
    Jobcentre Plus continues to work flexibly within the limits of benefits legislation to
       provide training allowances for people attending training for more than 16 hours a
       week.
    MG Rover Training Support Programme continues through the 2006/7 financial
       year and besides the skills hub noted above, includes employee Bursary Support
       for higher level training.

During January/February 2006 as a precursor to the Employment Support Project
outlined in section 6.3 of this report, a series of short events were held at Birmingham
South West (BSW) Jobcentre Plus Office after mailing-out the 550 remaining
unemployed former MG Rover workers registered with them. The events were run over a
two week period and covered the following subjects:

 Work Trials  “What do employers want”  Marketing yourself to employers
 Working in construction  Financial help when working  Working for Agencies
 Working for the NHS  Money management  Self Employment.




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100 individuals responded and advisory staff from the Employment Support Project
attended each session to encourage individuals to take up the support opportunities.
With 90% attendance rate, client feedback has been extremely positive.
Jobcentre Plus and LSC work will now continue through 2006/7 to engage with and
provide a further programme of assistance to remove some of the barriers that prevent
the unemployed in this area from getting back to work. Birmingham City Council will
assist with management of the pressures of debt. (Refer Section 6.3)

ENTERPRISE SUPPORT

Financial support is one of the main hurdles faced by ex- MG Rover employees
interested in self-employment. Often a small intervention is required to enable the
purchase of equipment. The Chamber has been able to respond very quickly in terms of
making contact with potential entrepreneurs and giving consultancy support in kind. But
financial support through the Chamber is limited to links and backing for financial loans,
which can be unhelpful to redundant employees already stretched financially. This has
prevented the Chamber from making selected financial interventions that might lead to
successful business start-up for many of these individuals, and consideration has been
given for some time on the best way to responsibly remove this barrier within allowable
grant processes. Consequently, a £200k Enterprise Award scheme for Small Business
start-ups is currently being developed for approval through the Task Force Executive
Sub Group to provide flexibility for small investments in purchase of equipment less than
£5k, etc.




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3.0 Supplier Support – Update

Wage Replacement Scheme
The Wage Replacement Scheme offered suppliers £50 per person per day for
individuals laid off for up to six weeks. This intervention was aimed at enabling suppliers
to avoid the knee jerk reaction of making immediate redundancies, which could later
become unnecessary following reassessment of their business plan.
This scheme was formally closed on 31st December 2005 since no new supplier
applications had been received for the three previous months.
As stated in the „Six Months On‟ report the final result was that from 170 suppliers
contracted, 1329 jobs were confirmed as saved through Wage Replacement Scheme,
which equated to an average cost £2537 per job saved. There has been no movement
since then.
Modernisation and Diversification – ongoing core programme:
Resulting from the original crisis of Rover Group in the year 2000 a major modernisation
and diversification programme was introduce to improve the competitiveness and
resilience of automotive suppliers. Funding to extend this core programme of Accelerate,
Diversification, and Mustard projects was agreed and topped up on the basis of the MG
Rover closure.
With MG Rover having around 150 suppliers in or around the West Midlands and 350
nationally, the success of these programmes is reflected in the relatively small number of
supplier failures and redundancies occurring as a result of the MG Rover closure.
         Estimated number of supplier redundancies – 2500*
        (*Based on survey of those companies on the wage replacement scheme Sept 05)
         Number of companies in administration - 7,
         Number of company or plant closures - 11,
A new, more specifically targeted, Phase 2 Supplier Support Programme has also been
approved for medium to long term, aimed at a smaller number of businesses who have
the potential to become globally competitive, and this Programme is detailed in Part 2 of
this report.
International Trade
This is another on-going intervention to support a number of trade activities that would
enable automotive cluster suppliers to explore opportunities in international markets.
These activities are supporting attendance at various trade events in new markets within
the extended EU, other EU candidate states and China, typically including:
         A training seminar on presenting/selling your product, prior to the event
         Subsidised travel package
         Subsidised entrance to the event
         Assistance of UKTI staff from the UK and posts/agents overseas
         Assistance from Accelerate




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The programme is managed by the UKTI team delivering international activities to the
AWM Transport Technologies Cluster delivered in partnership with “Accelerate”, the
SMMT and the UKTI, automotive international sector unit.
The programme provides a balance between examining the mature European market
and rapidly developing markets.        Companies will have access to experienced
international trade advisers as mentors.
   13 companies were supported to attend the Equip Auto exhibition in Paris 13th-18th
    October. Initial feedback on the event was very positive.
   Two companies were supported on an MIA/SMMT/UKTI automotive mission to China
    in late October
   This initiative will part fund a project designed to match West Midland suppliers with
    opportunities in the Slovak Republic. The research in Slovakia will start next month.
   Recruitment has started for a partnering event with the automotive cluster in
    Flanders
This programme will continue to be supported through 2006/7, particularly to enable
follow up of the work being undertaken in Slovakia and to undertake projects in China
once the position re Nanjing Automotive Corporation (NAC) and Shanghai Automotive
Industry Corporation (SAIC) becomes clearer. i.e. In terms of the ex MG/Rover products
they will produce in China, and any resultant component supply opportunities from the
UK.




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Part 2 – Future Actions 2006 -2008

4.0 The Transition Process
Task Force Executive Sub Group:
Originally, the need for the MG Rover Task Force to fulfil its co-ordination role was
expected to cease by the end of December 2005. Due to the numerous ongoing and
new projects and final reports to Government by the Task Force and the National Audit
Office, it was considered necessary to extend this period to the end of February 2006.
Following the ending of the Task Force, individual agencies will be responsible for their
own areas and all Task Force funded projects will be managed directly by the
responsible agency which will be accountable for delivering the planned outputs, and for
financial reporting.
A Task Force Executive Sub-Group, chaired by Nick Paul, will be formed to approve in
principle any further TF expenditure, or any change in the application of TF Funds. The
membership will include the executive agencies, together with a small number of non-
executive TF members representing business and the workforce.             This Group, as
defined below, will where necessary provide overall co-ordination for continuing inter-
agency work related to MG Rover.
The Task Force Executive Sub Group will meet approximately once every three
months or as needs develop and will consist of:
    Chairman, Advantage West Midlands (Chair)
    Chief Executive Officer, Advantage West Midlands
    Chief Executive, Birmingham & Solihull Chamber of Commerce
    Regional Director, Jobcentre Plus
    Regional Director, Learning and Skills Council, Birmingham
    Regional Director, Government Office West Midlands, also representing DTI
    Strategic Director for Development, Birmingham City Council
    Two Industry representatives from the Task Force
    One Workforce representative from the Trades Unions.
    Secretariat - AWM

Role of the MG Rover Task Force Executive Sub Group:

      In principle approval of further expenditure of Task Force funds, or change of
       their use.
      Strategy, policy, and priority guidance for actions funded by the MGR Programme.
      Co-ordinate inter-agency activities where necessary/requested
      Monitor progress to targets
      A communications channel to/from Government to/from the actioning Agencies
       on MG Rover issues.
      Appropriate reporting




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SW Birmingham – Investing for transformation

In addition to the Task Force Executive Sub Group which co-ordinates the overall MG
Rover regional response programme, there is an additional steering group which acts as
a forum for the various agencies to co-ordinate their work specifically focused on SW
Birmingham. This group is chaired by Birmingham City Council.

The Prospectus which will be developed by this group will include three key elements to
continue the work done through the Task Force. This work will need to be reflected in the
Regional Economic Strategy (RES).

    To drive forward a growth and regeneration agenda. A key element of this will be
     the regeneration of the largest development site in the region – the Longbridge
     plant. There will also be particular focus on housing and physical infrastructure, for
     longer term benefits.
    To steer the short term tasks within the Community Support Programme. The
     various agencies will participate in this group to co-ordinate and deliver their own
     work.
    To match the longer term needs of growth and enterprise developments with an
     improved local skills base and thus secure more employment and inclusion of the
     community in future plans for the area.

The form of governance will emerge as the phasing and priorities of the workload
demands, but it will reflect the roles and accountabilities of the individual agencies and
the overall Task Force Executive Sub Group.

Relationship between the Task Force Executive Sub Group and the South West
Birmingham Steering Group:

The Task Force Executive Sub Group provides region-wide co-ordination of the whole
ongoing MG Rover Task Force support programme. The South West Birmingham
Steering Group acts as the co-ordinating forum for agencies planning and delivering
services and support specifically for South West Birmingham.




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5.0 Supplier Support - Phase 2 - Longer-Term
The Phase 1 Supplier support was a short term reactive intervention to give the MG
Rover supply chain at all levels the breathing space to adjust their business plans and
minimise redundancies, whereas the second phase aims at strengthening the
automotive sector in the region. It is aimed at businesses which have the capability to
grow and evolve, and contribute to the regional economy in the long-term. Further
developed since the last Task Force report, the proposed structure of the £9.6m „Phase
2‟ programme comprises 3 principal elements:

         A Productivity Alliance designed to close the productivity gap through
          sustainable dissemination of best practice. It will be aimed at approximately 50
          medium-to-large automotive companies in its pilot phase, mainly Tier 1 and Tier
          2 suppliers. It will produce significant improvements in quality, cost and delivery
          measures and in the long-term capability of these companies and their supply
          chains.
         A Business Support Programme (based upon established best practice) which
          will focus on supporting approximately 100 small-to-medium automotive
          companies to penetrate new markets, develop new products and win new
          business by improving their competitiveness.
         An Innovation & Technology Support Programme to encourage take-up of
          innovation and technology by the automotive sector. Under the guidance of the
          Innovation Technology Council, proposals have been developed for a series of
          Centres of Excellence. The first two are in the areas of electronic reliability and
          design for niche vehicles. Other proposals are being developed.

All of these elements are crucial to the sustainable development of the West Midlands
automotive supply chain in light of the demise of MG Rover and consistent with the
broader West Midlands Automotive Strategy.

5.1       PRODUCTIVITY ALLIANCE (PILOT)
Objective
    To increase the productivity and competitiveness of approximately 50 automotive
       suppliers whose continued presence is of key importance to future health of the
       West Midlands supply chain and economy.
    To up-skill these workforces in a set of tools and techniques recognized by all the
       global vehicle manufacturers with facilities in the UK, these skills will be
       transferable beyond the automotive sector, aiding company diversification and
       employee mobility.

Method
    The pilot programme will be a development of the well-established NEPA (North
      East Productivity Alliance) scheme which has been operational for almost 4
      years. NEPA is sponsored by AWM‟s sister RDA One North East.
    Following the NEPA model, major companies will second suitable personnel to
      the programme for a two years training period. Having been trained in “learning
      by doing” mode and helped targeted companies improve their Quality, Cost and



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          Delivery performance, the secondees will return to their own companies thus
          building the capacity of capable “Change Agents” within the region.
         The companies targeted for engagement in the scheme will be those seen as
          long-term strategic members of key supply chains.
         Employees of the targeted companies will be registered for a range of NVQs
          which are specified in the Sector Skills Agreement complied by SEMTA – the
          Sector Skills Council whose footprint encompasses automotive, general
          engineering, aerospace and science.

Delivery, Cost and Timing
    Detailed planning of the programme is approaching completion and it is expected
       to commence as a pilot scheme in Quarter 1 of 2006-07.
    The programme will be managed by the Manufacturing Advisory Service – West
       Midlands. SMMT Industry Forum will be the principle delivery partner. An
       industry-led steering group will be established which will include senior figures
       from automotive and related sectors.
    The programme will assist 50 companies, directly improve the skills of 446
       people and safeguard 140 jobs.
    An investment requirement of circa £3.5m has been indicated as necessary to
       cover the pilot phase of the programme.

5.2       BUSINESS SUPPORT PROGRAMME
The Business Support Programme will have two parts, covering new product
development and improving competitiveness.

Product Development & Introduction

The primary scheme will be an adaptation of the current High Performance Engineering
(HPE) Scheme, which supports companies in procuring specialist technical support,
primarily from R&D organisations and Universities, in the design and development of
specific new products.

Funds will be used to expand capacity of the existing HPE programme to accommodate
increased demand, and will be extended beyond its current completion date of March
2006. The current scheme has no capacity for additional participants. Delivery is the
responsibility of Coventry Chamber of Commerce.

This will be supplemented with a new scheme, The Product Innovation Consortium,
which provides surrogate project management of the new product development and
introduction process, using specialist advisers from the Manufacturing Advisory Service
(MAS).

The scheme is aimed at companies which lack the experience of successfully
developing and implementing new products. Funds will be applied to a pilot scheme for
10 automotive companies and will be delivered by MAS-WM.

Improving Competitiveness

The primary scheme will be an adaptation of the Accelerate New Business Development
Grant, which was introduced and proven to be effective in Phase 1 of the MGR Supplier


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Support Programme. This will provide a flexible way of providing supplier support in
areas relating to winning and undertaking new business.

The scheme will comprise individual interventions tailored to the specific needs of
companies affected by the demise of MGR, and will include the flexibility to support a
range of projects including investment in new equipment, improving manufacturing
processes, implementing e-business, developing marketing strategies and improving
logistics. Delivery will be the responsibility of the Accelerate team at Birmingham
Chamber.

5.3 INNOVATION AND TECHNOLOGY SUPPORT
At the time of writing this Final MG Rover Update report, of the Centres of Excellence
proposals currently being developed, the ITC has prioritised 1 (Electronic Reliability) & 2
(Design for Niche Automotive) for detailed development. The six proposals, under 3
(PACE) are currently being developed, and two more have been suggested for
investigation; these projects are currently being developed for subsequent prioritisation.

1. a Centre of Excellence in Electronics Reliability (in partnership with TWI – The
   Welding Institute) dedicated to systems reliability and product life management.
2. a Niche Automotive Centre of Excellence in Design (in partnership with Coventry
   University.)This will support collaborative research and innovation in conceptual
   design, styling and manufacturing feasibility for low-volume niche vehicle production
3. Premium Automotive Centres of Excellence (PACE)
   Building on the current Premium Automotive Research & Development (PARD)
   Programme, discussions are taking place with Warwick Manufacturing Group
   concerning the possibility of creating up to 6 centres of excellence.
        Vehicle Electronic/Electrical Systems Engineering
        Multi-material Characterisation & Application
        Advanced Joining & Forming
        Hybrid Control Systems Integration
        Craftsmanship
        Digital Manufacturing




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6.0 South West Birmingham Growth & Support

The community impact of the MG Rover failure is highly localised with the greatest
concentration in South-West Birmingham. In tandem with the work on delivering high
value added jobs, work is needed to develop immediate jobs in these areas. South-
West Birmingham does not fall within a Regeneration Zone and some mechanism is
needed to avoid descent into a spiral of decline. Work is currently underway on
developing a longer-term strategy for South-West Birmingham which will major on the
projected population growth of this part of the City over the next two decades. As
promised in the previous report, the outcome of this work is outlined here.

Birmingham City Council are chairing the partner Government agencies in the SW
Birmingham Steering Group to drive forward an ambitious programme of transformation
in the SW Birmingham area. This will be delivered through the best use of public assets
to trigger private investment in partnerships, developments and joint ventures.

The form of governance will emerge as the phasing and priorities of the workload
demands, but it will reflect the roles and accountabilities of the individual agencies and
the overall Task Force Executive Sub Group (see section 4.0).

The Prospectus which will be developed by this group and will include three elements to
continue the work done through the Task Force, namely:
    the regeneration of the largest development site in the region – the Longbridge
      plant (Section 6.2).
    short/medium term community support programme (Section 6.3).
    longer term skills development for jobs (Section 6.4).

The challenges that lie ahead over the short and medium term remain formidable – and
can only be remedied in the interests of the quality of life of present and future
generations by being set in an ambitious long term strategy which is reflected in the
Regional Economic Strategy.

South West Birmingham will now be an established priority in the work of the principal
partners, and is particularly a new major priority for Birmingham City Council which will
lead the process of transformation.

6.1     SW BIRMINGHAM – INVESTING FOR TRANSFORMATION
The following critical success factors will apply:

                 Short term responses are within a longer term vision
                 Physical transformational actions, combining public and private sector
                  investment will denote success
                 Public sector working in partnership to create private sector conditions
                  for growth will be a defining principle

A process of consultation and debate is currently taking place that will culminate in a
statement of the vision for the SW of Birmingham. The City Council will launch a


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prospectus of opportunity to enable public and private sector partners to direct
investment in a coherent and effective way.
Key Drivers:
              Growth for the city-region
              Continued economic diversification through the Central Technology Belt
                 (CTB)
              Stimulation of investment in local centres
              Housing demand for choice and sustainability
              University Hospital and development of medical technologies
              Best use of public sector land supply and its contribution to investment
                 agenda

Co-ordination through meetings with strategic partners is already taking place and will
contribute towards the production of a strategy and critical timetable for delivery. The
content will inform future major strategic and programme decisions and main agencies
and continue a dialogue with Government.

Key issues for the future

Economically, socially and environmentally there is a need for concentrated effort post-
MG Rover. There are a number of particular factors which should be addressed:

   Recognition of the continued impact of local economic decline in SW Birmingham
    and the endorsement of a continued public sector response

   The need to identify and work with the residual cohort of older, lower skilled
    workers concentrated in SW Birmingham and those disadvantaged in the labour
    market. This should be addressed through tailored partner responses.

   Proactive efforts through debt advice are still needed

   Strategic identification of potential benefits from physical regeneration schemes
    such as local labour and training agreements with site developers and occupiers

   Addressing the significant potential mis-match between those seeking work and
    the employment opportunities attracted within the knowledge intense sector (CTB)
    e.g. through actions in education to prompt aspirations and appropriate skills
    development.


6.2    LONGBRIDGE SITE DEVELOPMENT
As a result of the closure of MG Rover, of the 160 hectare site occupied by the
production plant and ancillary uses, significant parts may become available for
redevelopment. This site offers one of the largest and strategically most significant
development opportunities in the West Midlands for many years.

At the time of writing, Nanjing Automotive Corporation (NAC) have extended their lease
on 42 hectares of the site, and have stated an intent to start up automotive production in


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2007, but there are no details of their long-term business proposals. However, the
relevant authorities will continue to work with NAC to maximise opportunities.

The preparation of an Action Plan by Birmingham and Bromsgrove Councils will
represent a „once in a generation‟ opportunity which could see even more people
employed from the complex than at the time of closure. Key issue will include:

           o    The need to ensure the primary use of the site delivers significant new
                employment opportunities across a range of sectors.

           o    Review of existing land use and the density of new employment
                opportunities will allow the consideration of other development options
                including housing and associated open space and play facilities.

           o    Consideration of the range, location and type of uses including retail,
                services, health and community uses that could be provided in the agreed
                new local centre.

           o    Options for transport infrastructure, including The M42 Link Road, public
                transport provision - particularly links to the Frankley area, Park and Ride,
                and potential alterations to the existing highway network.

           o    An exciting proposal to create a 14 -19 vocational centre to focus on
                community needs and employer demand for workforce skills. There are
                also discussions around the possibility of a more substantial relocation of
                Bournville College to the Longbridge site. A central theme in these
                projects is integrated community and schools connections expressed as a
                vocational hub, offering skills in computer engineering, science,
                electronics and construction technologies. A landmark bid to the Lottery
                for a building to take this agenda forward has also been prepared by
                Bournville College

Wider regional and national interests may well emerge through the consultation process.
The scale of development opportunity is likely to generate significant interest at the
national and also possibly international level. The Area Action Plan could address the
scope for the development of a major visitor attraction or other centres of wide
geographical significance such as facilities of education, sporting, or other excellence.

Irrespective of the range of final agreed land uses, there is the potential to deliver
architecture, design and sustainable development of high order.

The Local Authorities will organise significant consultation as part of the preparation and
delivery of the Area Action Plan. The involvement of communities and stakeholders at an
early stage is a key feature of the process and will be the principal means through which
the development options for the site will be generated.

Progress to Date:

A local Longbridge Development Framework covering 28 hectares of land released
following the first Rover crisis had already been adopted (January 2003), and this



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outlined a number of early start sites to facilitate the delivery of a high technology
business park, and a new local centre for Longbridge. The delivery of such uses in
connection with the A38 Strategy and the Central Technology Belt remains a priority, as
does the delivery of a strategic park and ride facility, about which discussions continue
with Centro. Outline planning permission exists for the High Technology Business Park
and detailed permission exists for the first new industrial buildings to be constructed on
the former North Works car park. Development work is now on site. The availability of
additional development sites will now allow some of these earlier land-use decisions to
be revisited.

The application for ERDF grant assistance to facilitate the preparation of the Action Area
Plan has been successful, and this will provide £350,000 of additional resources. This
will be matched funded by Birmingham City Council officer time in kind, and potential
contributions from Bromsgrove District and Worcestershire County Councils

The Action Area Plan process will involve the following stages:

         The preparation of baseline information about the constraints and opportunities
          associated with the site (this will include information about economic and social
          issues, transportation, infrastructure, site conditions, ecology etc.,),
         The preparation of development options for the site in consultation with the local
          community and all other interested parties, and consultation on emerging
          development options,
         The preparation of preferred options for the site and consultation on options,
         The submission of the preferred options to the Secretary of State for examination
          in public. The Secretary of State‟s decision on the document will be binding

Consultants are in the process of being secured to undertake early technical aspects of
the preparation of the plan and assist with what will be a substantial consultation
process. It is proposed that preferred options stage will be reached during the summer.

6.3       SW BIRMINGHAM COMMUNITY SUPPORT PROGRAMME
To accelerate direct action on many urgent employability and debt relief issues, a SW
Birmingham Community Support programme of projects will be funded from a specific
allocation in 2006/7 and 2007/8 within the Phase 1 Emergency Package of the overall
MG Rover Task Force Programme.

Urgency for special action is illustrated by the initial findings of the Longitudinal Study
commissioned by the LSC and Jobcentre Plus (mentioned in Section 2), which indicated
that at the time of the survey (October 05), 49% of unemployed respondents were not
confident of finding work in the next twelve months, while 47% of those unemployed did
not have any training plans/self employment plans/ interviews or job offers.

Base data shows that at the time of closure, 47% of the MG Rover workforce were over
45 years old, and the study indicated that this group had the highest proportion still
unemployed (45%) and were experiencing more than double the unemployment rate of
the under 35s (19.6%).

The survey sample indicated that a small group – 2.4% of the former workforce –
remains inactive in terms of seeking employment. Whilst this accounts for not much


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more than 100 individuals – it does include former employees from all age groups. The
qualitative exercises revealed the influences of mortgage protection, and the benefits
trap in relation to what were perceived as largely low wage jobs on offer.

Introduction and summary of the proposal

The aim is to use and develop best practice from the Working Neighbourhood Pilot in
Newtown, Aston, in Birmingham (WiN). This is one of 12 Jobcentre Plus pilots nationally
testing a new approach of offering intensive support to help local residents overcome
barriers to employment. The scheme in Newtown is run by Pertemps as part of their
Employment Zone contract with Jobcentre Plus.
This Employment Support Package will be for former MG Rover employees and the
South West (SW) Birmingham community.

Branded „Working for Jobs‟, the Employment Support Package addresses barriers to
employment and work to help former MG Rover workers and SW Birmingham residents
move into sustainable employment. The support package brings together services
currently delivered by Jobcentre Plus, LSC, local colleges, other providers, and
Birmingham City Council.

At the time of writing, 1854 ex–MG Rover and supply chain employees are still to find
new employment. These are made up of people who are currently retraining, those who
have had training and have now returned to claim benefits and those who have not yet
taken up the offer of re-training. They continue to face major challenges in getting back
to work e.g.

      Lack of appropriate level of work experience;
      Lack of confidence;
      Inadequate job application and interview skills;
      Lack of awareness about selection processes used by companies;
      Unrealistic expectations of the labour market – location of work and rates of pay;
      The need for debt counselling and possible family mediation;
      Travel to work constraints for those living on the periphery of Birmingham.

Many of these barriers are not exclusive to former MG Rovers but are also being
experienced by many of the community of South West (SW) Birmingham.

The Hollymoor Centre will be the focal point for the Employment Support package prior
to it being relocated to a high street shop / office based premises in the Northfield
shopping centre. Hollymoor has been the primary base used for MG Rover Skills
activities developed to support ex MG Rover workers employees in SW Birmingham
area, funded through European Social Funding (ESF) via Birmingham & Solihull LSC.

The initial process

Existing services will be offered under a “one-stop shop” approach where possible. This
will deliver an individually focused package of support services meeting the specific
needs of former MG Rover workers and SW Birmingham residents. At present work is




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underway to produce a unique identity and branding for the project. Once completed, the
employability support package would offer a menu including:

Individual Employability Support:
This will give individuals the maximum chance of obtaining sustained employment by
developing the skills to apply to advertised vacancies and make effective direct
approaches to companies. E.g. Diagnostic one-to-one interviews, job search techniques,
CV support, interview techniques, work experience, etc.

Individual Personal Support:
To overcome the underlying factors that act as barriers for individuals. E.g. Debt advice /
money management, benefits assistance, dealing with rejection, motivation / confidence
building, travel passes, etc.

Additional Support:
Consisting of: Learn direct, childcare, access to phone / ICT / stationery; access to
limited financial support for employment start up costs e.g. transport, travel, and clothing.

Engagement with the workforce has already commenced with mail-outs and initial
diagnostic interviews, and has put Jobcentre Plus, LSC and BCC in a better position to
understand the range of provision needed to deliver the aims of the programme and
begin to “buy in” the services

Rollout of the programme

All former MG Rover workers who have to date not found new employment will be
included in this exercise and invited to participate. At a later stage potentially SW
Birmingham residents will also be eligible to participate. Their involvement in the
programme will be via a drop in basis initially. Once suitable marketing material has
been produced, a wider campaign to encompass all eligible customer groups will
commence. The impact on SW Birmingham residents of the delivery of the programme
will undoubtedly gain impetus once the project relocates into shop-front premises in
Northfield from the end of June 2006.

Linkages to City Council actions

Debt advice and advice to individuals and families through the Northfield Neighbourhood
Office will connect with the employability support package being assembled. Two
additional specialist staff are being employed for 18 months.

Careers support for entry into employment with Birmingham City Council and linked
organisations will continue. It is estimated that up to 30 people affected by the closure of
MG Rover are now employed by the City Council.

Engagement programmes to provide connection to social activities for individuals and
families, to benefit from service enhancements and to develop the reach and potential of
the Rover Community Action Trust (established by the community) will continue to be
steered by the Community Support Board. A Community Networks project is recruiting
shortly for a development team to work with local organisations in engaging people in
economic activity and to link them to social support and services of benefit.



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Local Business Support and Local Environmental Management

Another urgent action provision within the Community Support programme is for the
business environment of SW Birmingham which is suffering ongoing economic threat as
a result of the closure of MG Rover. Many local traders and non-automotive suppliers
have had reduced income and difficulty in staying in business and have either laid off
workers or reduced staff hours to cut costs. A study in September 2005 of 400 small
businesses in seven wards 3 (selected for their high concentrations of redundant MG
Rover workers) indicated that 44% of small businesses in SW Birmingham recorded a
fall in turnover and that 35% had considered selling or closing their business as a result.

This „Business Connections‟ proposal provides:
   A network of local business to enable business forums to operate
   Passporting of job capture and skills needs of business to the partners
   City Council connection for local environmental management and other services.
   Access to business image investments

The package includes £55k for image improvements, signage, litter management,
lighting, etc.

6.4 LONGER TERM SKILLS DEVELOPMENT

The Learning Skills Council has secured European funding to extend the timescale of
the Community Support package from August 2006 until March 2008. Continuation of
this employment support to SW Birmingham long-term will be co-ordinated with the
industrial, retail, and commercial plans being developed for the Longbridge site which
will ensure that enterprises attracted to the area supply jobs of a variety of skill types and
levels, and that local education, skills training, and work experience, is directed to meet
the demands of these incoming jobs and other available employment opportunities.

The MG Rover Task Force has given approval in principle for a £3.0m allocation to
create a Vocational Training Centre for 14 - 19 year olds in the Longbridge area. The 14
- 19 centre will create opportunities for new vocational provision in particular with regard
to the forthcoming national „specialist‟ diplomas which will be made available at three
levels from September 2008. Bournville College will work with local schools and the
collegiates in the South West of Birmingham to identify and develop an appropriate
curriculum and facilities. Initial planning is focussing on the feasibility of the centre being
located on the existing Longbridge site, aiming for it to be operational by September
2008.




3
    Bartley Green, Bournville, Brandwood, Kings Norton, Longbridge, Northfield and Weoley



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                                                                        APPENDIX 1 1 of 2

MG ROVER SUPPORT PROGRAMME - FINANCE SUMMARY

Shortly after the MG Rover failure the Secretary of State for Trade & Industry announced
the allocation of £155.6M subsequently Advantage West Midlands and Birmingham City
Council added a further £20m of public funding to support the response to the situation.
The allocation of this funding is set out below. (“Allocated “).

The table is the status as at 10th February 2006 and shows the amount of money
“forecast” for expenditure against each programme over the whole three years, as well
as the amount already “committed” or approved by the Task Force to each programme.

Forecast and committed figures in some programmes may change as further
commitments are made.
                                                                                                 1             1,2
 Project Description                                                  Allocated     Forecast         Committed
                                                                                                     or Approved
 (Three year programme 2005/6/7-8)                                                                   by Task Force

                                                                      (£m)          (£m)             (£m)
 Supplier Support:
 Extension to current diversification/accelerate/mustard                     18.4           18.4              18.4
 Phase 1 Short Term Response
 - Emergency Supplier Support - Wage replacement, etc 3                      10.2            6.4               5.9
                                    4
 - Task Force Response Fund – Jobs Fair, Business start-                      3.0            2.7               1.0
                                            ups, etc.
                                                                5
 Phase 2 Long Term – Competitiveness Improvement                             10.0            9.6               6.2
 Sub Total                                                                   41.6           37.1              31.5
 Employee Support:
 MG Rover Training:
 - Revenue - Manufacturing Skills Hub project                                 5.0            4.7               4.4
 - Capital - HD Academy & 14-19 Vocational Centre (£3m)                       5.0            5.0               5.0
 Birmingham City Council Projects (see App 1 page 2)                         10.0           10.0               3.5
 Direct Employee (redundancy/notice/compensation)                            40.0           55.0              55.0
                                        6
 Regional Training Programmes:
 - Training/training support - all spend on MGR companies                  10.0             10.5               5.8
 - Wage subsidy, work experience – objective 2 project tba.                 5.0              5.0               0.0
 - Employer Training Pilot - MGR draw-down insignificant                   25.0              0.0               0.0
 Sub Total: Employee Support                                              100.0             90.2              70.7
 Technology & Innovation – Capital - Contribution to Centres                9.0              8.0               0.0
                                                of Excellence
                                                  7
 Advantage Transition Bridging Fund                                          25.0           10.0               5.0
 Total Programme                                                          175.6            145.3             110.2
1.
     Forecast and commitment/approvals as at 10th February 2006.
2.
     Forecast is what the programme expects to spend. Apparent under- commitments are explained by:
3.
     Fewer MG Rover suppliers than feared needed to claim wage support
4.
     Includes TF approved proposal for SW B'ham Community Support(£1.4m)
5.
     Includes TF Approved proposal for Innovation & Technology Centres of Excellence(£3.2m)
6.
     This regional training budget was available to, but not exclusive to ex MG Rover /supplier employees.
7.
     Additional applications in pipeline



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               MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006
                                                                 MG Rover Task Force Report

                                                                       APPENDIX 1 2 of 2

Birmingham City Council Funding to assist with the consequences of
events at MG Rover


 Key points:

 We have provided these key roles:
    To facilitate a community input to the work of the Task Force
    To adapt and expand our own service response
    To provide investment for the medium and longer term future of those
       areas affected, particularly SW Birmingham
    To provide a reference point for other local authorities to inform their
       provision

 £6m is the direction of existing regeneration programmes, £4m additional
 resource.

 Projected Spend
 £m                       2005/06              2006/07               2007/08                Total
 Existing                   0.66                 1.67                  3.67                  6.0
 Additional                 0.22                 2.57                  1.21                  4.0
                            0.88                 4.24                  4.88                 10.0



Measure              Projects allocated so far                                Exist(£m)         Add‟l(£m)
Economy:             Access to Employment and business skills                                     0.30
Focusing on          Access to employment issues                                 0.40
access to            Jobs Fairs                                                                   0.05
employment and
                     Community Economic Network                                                   0.75
welfare (20% of
resources            Kings Norton New Deal for Communities                       0.70
Infrastructure:      Master planning for Longbridge Site                                          0.25
Land use dev‟t       City Image – improved marketing                                              0.15
and access to        Frankly Centre Regeneration                                 1.30
strategic site
development
Enterprise &         Enterprise Centre at Aston Science Park                                      1.00
Innovation:          Investment in Commercial Centres                            2.00
Focusing on the      Creative Development                                        0.50
diversification of
the local
                     Enterprise in the South West                                                 1.00
economy              Successful Business Network                                                  0.10
                     The Entrepreneur fund                                       0.40
Community            Community Service Enhancements                                               0.40
Support and          Advice provision for 18 months                                               0.12
Regeneration
                                                                 TOTAL            5.3             4.12




                                             Page 30 of 34

              MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006
                                                         MG Rover Task Force Report


                                                               APPENDIX 2 1 of 1

ASSOCIATED REPORTS


  1) Closure of MG Rover: Economic Impact Assessment
                          – An interim Report – July 2005

     Commissioned by the MG Rover Task Force

     Author: Regeneris Consulting
             Nos. 1 – 5 The Downs, Altringham, WA14 2QD
             Tel: 0161 926 9214

  2) Supplementary Report : Lessons Learnt - July 2005

     Author: MG Rover Task Force members with editorial assistance
     from Stephen Nicol, Regeneris Consulting

  3) Closure of MG Rover: Economic Impact Assessment
                          – Stage 2 Report – November 2005

     Commissioned by the MG Rover Task Force

     Author: Regeneris Consulting
             Nos. 1 – 5 The Downs, Altringham, WA14 2QD
             Tel: 0161 926 9214

  4) Review of insolvency framework in the light of the MG Rover
     Collapse – September 2005

     Commissioned by the MG Rover Task Force

     Author: Tim Mocroft FCCA

  5) Impact of MG Rover’s Closure on Small Businesses in South West
     Birmingham

     Author: Birmingham City Council – October 2005




                                     Page 31 of 34

      MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006
                                                                                        MG Rover Task Force Report

                                                                                                 APPENDIX 3 1 of 3
LONGITUDINAL STUDY TABLES
The figures and tables below are examples of draft interim results of the „Longitudinal
Study‟ commissioned by the MG Rover Task Force, and undertaken by Vector
Research. This study is in progress, and will cover a number of themes with completion
due later in 2006. These first quantitative results are based on a telephone survey of 570
ex-MG Rover employees in October 2005, hence all results are indicative not absolute.

Figure 1: Destinations of former workers

By mid October 46 per cent of former MG Rover workers had secured new employment
– of which 62 per cent was permanent full time employment;

                                                                       Incapacity benefit
                                                      Retired
                                                                             2.0%
                                                       0.3%


                                                                                                    Work - f/t perm
                                                                                                       29.0%

                         Unemployed
                           40.5%




                                                                                                   Work - f/t temp
                                                                                                       8.6%

                                                                                               Work - p/t perm
                                                                                                   1.7%

                                                       Training                Self-emp          Work - p/t temp
                                                        10.4%                   5.0%                 2.4%

Percentages, Weighted Base: 558

Figure 2: Salary comparison

             39.7

                                        33.6

                          28.1
                                 25.2


                                                                17
                                               12.2
                                                                     7.6           8.8
                                                                                         6.1                4.8       5.2
                                                                                                      4.6                   4.4
       2.8




    Under £15k        £15k to £19.9k    £20.0k to         £25k to £29.9k £30k to £34.9k £35k to £39.9k                £40k +
                                         £24.9k

                                                  At MG Rover              In new job

Percentages, Weighted Base: 304




                                                         Page 32 of 34

                    MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006
                                                                       MG Rover Task Force Report

                                                                                 APPENDIX 3 2 of 3
Table1: Salary comparisons
                                                     Salary at MG Rover
                                   Under      £15k -    £20k - £25k - £30k -                        £35k -      £40k
Salary is now:          Overall    £15k       £19.9k £24.9k £29.9k £34.9k                           £39.9k      +
Much higher               5.0         3.9        2.4       2.7      7.4  24.8                         -           6.0
A little higher          18.1        51.7       10.0      11.0     27.6  31.1                        27.9         6.0
About the same           13.8          -        15.1      12.1     17.2  14.0                        26.7        12.0
A little less            12.8        11.1       11.9      13.4     14.2   3.8                        16.5        21.9
A lot less               50.3        33.2       60.7      60.7     33.5  26.2                        28.9         54
Total                   100.0       100.0      100.0     100.0    100.0 100.0                       100.0       100.0
Percentages, Weighted base: 304
Key:
Soc 1,2,3        Managerial professional
Soc 4,5,6        Admin/personnel/customer services
Soc 5            Skilled trades
Soc 8,9          Process elementary


Table 2: Changes in occupational role
                                                     SOC code of former role at MG Rover, %
                                                     Soc 1,2,3              Soc 4,7            Soc 5              Soc 8,9
SOC code of new employment
Base                                                         68                   20                 43                 72
Managerial/professional                                      64.6                 36.8                9.8               10.1
Admin/personnel/customer services                            16.9                 42.1                7.3                13
Skilled Trades                                                3.1                 10.5               29.3               10.1
Process/ Elementary                                          15.4                 10.5               53.7               66.7
Total                                                       100.0                100.0              100.0              100.0
Percentages, Weighted Base: 204


Table 3: Changes in industry by occupational role
                             SOC code of former role at MG Rover, %
SIC category of new
employer                     Soc 1,2,3        Soc 4,7               Soc 5                Soc 8,9          All
Base                               45                 15                    37                58                155
Manufacturing                     34.9               42.9              42.9                  36.4               40.2
Electricity, Gas and
Water supply                       0.0               0.0                2.9                  0.0                0.6
Construction                       2.3               7.1                2.9                  5.5                4.3
Wholesale and Retail
trade: repair                     11.6               21.4              17.1                  3.6                9.8
Hotels and Restaurants             2.3                0.0               5.7                  1.8                2.4
Transport, Storage,
Communication                      4.7               0.0                5.7                  14.5               9.1
Financial
Intermediation                     4.7               0.0                0.0                  0.0                1.2
Real estate, renting
and business activities           27.9               14.3              14.3                  18.2               18.9
Public administration               7                 0.0               2.9                   3.6                3.7
Education                          2.3                0.0               2.9                   5.5                 3
Health and Social work             0.0               14.3               0.0                   7.3                4.3
Other community,
social and personal
service activities                                                                                              2.4
           Total                  100                100                100                  100                100
Percentages, Weighted Base: 155



                                               Page 33 of 34

               MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006
                                                                  MG Rover Task Force Report

                                                                          APPENDIX 3 3 of 3
Table 4: Agreement: current employment as stop-gap
                                  SOC codes of former/new employment %

                                  Soc 1,2,3       Soc 4,7         Soc 5          Soc 8,9           All
Former employment type                43.2             41.9          52.7            55.4                47.7
New employment type                   39.8             48.3          36.2            58.9                47.7

Table 4 shows that whilst dissatisfaction as expressed in the view of the job as a stopgap is
greatest amongst those who have secured new process/elementary type employment (i.e. SOC
8/9). However, a significant proportion (in excess of one-third) of all 4 groupings claim to be
looking for something better.

Table 5: Assistance of new skills to gain employment
                                  SOC code of former role at MG Rover, %
In gaining new employment, my
new skills were:                  Soc 1,2,3       Soc 4,7         Soc 5          Soc 8,9           All
Base                                    34              11             30             34                 126
Vital                                 40.6             60.0          48.3           59.4                 55.8
of considerable assistance            25.0             20.0          17.2           12.5                 16.7
of slight assistance                  15.6              0.0          24.1            9.4                 13.3
of no assistance                      18.8             20.0          10.3           18.8                 14.2
Total                                 100              100           99.9           100.1                100
Percentages, Weighted Base: 126


Table 6: Types of new skills developed
                                                                                   No. who gained a
Type of new skills developed                     No.            %                  qualification
HGV / Forklift Truck driving                            27            23.5                  19
IT Skills                                               16            13.9                   8
People skills / Handling customers                      16            13.9                   2
Health & Safety / First Aid                             13            11.3                   7
Electrical skills (wiring / maintenance)                 8             7.0                   1
Machine work (Industrial)                                8             7.0                   3
Building maintenance                                     8             7.0                   3
Small Business (Setting up / Running)                    6             5.2                   1
Computer Aided Design                                    5             4.3                   2
Quality Management                                       5             4.3                   2
Spot Welding                                             3             2.6                   3
Total                                                  115            100                   51
Percentages, Weighted Base: 115


Table 7: Course type
                                                                    No                       %
Long course funded by the LSC                                       31                      56.3
Short course funded by the LSC                                      13                      23.5
Other course at local FE college                                     2                       2.9
Other                                                                9                      17.2
Total                                                               55                      100
Weighted Base: 55




                                              Page 34 of 34

               MG Rover Task Force - Final Update Report - ‘The Work Goes On’ – 6th March 2006

				
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