NEWS: Workers at GKN Chester Road factory vote ‘yes’ on redundancy package

Words by Ed King / Pics supplied by Unite, Jack Dromey MP, Google Street View

Workers at the GKN Chester Road factory have voted ‘yes’ to a redundancy package offered by GKN’s owners, Melrose PLC.

After months of fighting the factory’s closure, including the threat of industrial action in September, the 500 plus workforce have now agreed to take the severance pay.

Referring to the Chester Road closure as a “betrayal of a highly skilled workforce”, a statement from Unite the Union told how workers at the GKN Chester Road plant had “little option but to accept a redundancy scheme offered by GKN Melrose after the company refused to reconsider the union’s plan to save the plant despite the government’s request for it to do so.”

Melrose PLC announced their plans to close the Chester Road plant in January 2021, which would see the loss of 519 jobs and major disruption to the local automotive supply chain – GKN Chester Road are a significant supplier to the neighbouring Jaguar Land Rover factory.

Following intervention from Unite the Union, Jack Dromey MP for Erdington, Birmingham City Council Leader Ian Ward, and West Midlands Mayor Andy Street, Melrose eventually entered discussions to explore another possibility to the closure.

However, Erdington Local learned the multi-million pound venture capitalists took only a matter of minutes to reject any alternative plans – committing to the Chester Road closure and sealing the fate of over 500 workers.

A further vote was then passed by Chester Road workers to accept the redundancy package from Melrose PLC.

Following the announcement workers would be taking ‘a negotiated redundancy package’, Jack Dromey MP for Erdington said:

“What cannot now be allowed to happen is for the plant and the 519 strong workforce to be thrown on the scrapheap.

“This plant is a site of British manufacturing excellence with a world-class manufacturing capability. The skill and experience of the workforce is irreplaceable and the envy of many in the industry.

“It is utterly shameful that GKN/Melrose have chosen to close the plant and turn their back on this loyal workforce. The loss of 519 good, well-paid jobs in an area of high deprivation – the fifth most deprived constituency in the country – will be a hammer blow.”

“The closure of the plant by GKN/Melrose is a betrayal of the British national interest.

“Never again can our manufacturing base be left so exposed to the greed and short-termism of private equity-style firms who have no interest in the long-term strategic interests of the British automotive industry.

“While the company have chosen to walk away, I firmly believe that the Chester Road site can have a bright future through an alternative use being found.

“I will continue to work closely with the workers’ union, Unite, the Government, the Mayor of the West Midlands and the Leader of Birmingham City Council to explore this option.

“The workers can be assured of my unrelenting support to leave no stone unturned to keep production going and protect manufacturing in the West Midlands.”

Unite national officer Des Quinn added: “For 10 months our members at GKN have fought hard to save this plant but it is apparent that GKN Melrose was never prepared to reconsider its original decision.

“Having failed to get Melrose to change its mind, the government must not fail the GKN workers again.

“The government must play a dynamic role in finding a company to take over Chester Road and save as many jobs as possible in the process because these are the skills our country needs if we’re to step up to the demands of climate action.”

To find out more about GKN Automotive visit www.gknautomotive.com
For more from Unite the Union visit www.unitetheunion.org
For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk  

NEWS: Strike at GKN Chester Road factory ‘suspended’ until October

Words by Ed King / Pics supplied by Unite and Jack Dromey MP

The planned strike at the GKN Chester Road factory will be suspended until Monday 18 October, announced Unite the Union in a statement issued this week.

Scheduled to begin on Monday 27 September, industrial action will now be put on hold for at least three weeks whilst representatives of the 500 strong workforce finally begin talks with GKN owners Melrose PLC.

GKN workers, Unite the Union, and Erdington MP Jack Dromey have been calling for emergency talks with Melrose for several months, wanting to explore alternatives to closing the plant, but have been constantly rebuffed.

At the eleventh hour ahead of industrial action Melrose have now agreed to enter talks about the future of the plant, which provides essential drives lines for the automotive industry – including the nearby Jaguar Land Rover plant at Castle Vale.

A plan for the Chester Road factory had previously been put forward and hopes remain the Erdington site could play a key part in the electrification of the UK’s automotive sector, building the new propulsion units needed in electric vehicles.

Unite national officer Des Quinn said: “In the spirit of good will, the planned strike action has been suspended to allow for talks about the future of the factory with key stakeholders to take place.

“It is hoped that all sides can use this window of opportunity to secure a long term future for the factory.

“Unite is dedicated to advancing the jobs, pay and conditions of its members and will fight back against any efforts to diminish workers’ living standards.”

Since the closure was announced at the start of the year, MP for Erdington Jack Dromey has been working with Unite the Union to negotiate a deal to save the Erdington factory.

Mr Dromey added: “The reopening of negotiations between the workers, their union, Unite, and GKN/Melrose presents a real opportunity to secure a settlement to save the GKN plant from closure.

“The GKN workers and Unite have always been clear that they stood ready to enter any discussions to save the GKN Chester Road plant from closure.

“In the spirit of that commitment they have suspended strike action to allow these talks to now take place. In return, the company have made clear their commitment to pause any movement of works and machinery out of the plant.

“It is vital that all those involved in these talks now do all they can to keep the plant open and to stop 519 well-paid, skilled jobs being lost in one of Britain’s most deprived communities.

“The role of Government will be key to prevent closure and the export of production to Poland and France. The British Automotive industry needs high-quality components made here in Britain.”

To find out more about GKN Automotive visit www.gknautomotive.com

For more from Unite the Union visit www.unitetheunion.org

For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk  

 

NEWS: GKN Chester Road workers on ‘all out continuous strikes’ from September 27

Words by Ed King / Pics supplied by Unite the Union and Jack Dromey MP

Workers at GKN Chester Road’s factory will be on ‘all out continuous strikes’ from Monday September 27, a statement from Unite the Union announced today.

Earlier in the month, Unite the Union held a ballot for industrial action with 95% of workers who voted saying they were in favour of strikes.

Unite general secretary Sharon Graham said: “GKN’s cynical attempt to close its Erdington plant is a disgrace. We will not stand by and let this employer offshore British jobs without a fight.

“We will leave no stone unturned in the ongoing battle to ensure the future of the Birmingham factory and our members.”

Unite national officer Des Quinn added: “Melrose GKN has grave questions to answer, if it has taken government money for research and development and now intends to use what it has developed abroad, that is a betrayal of the workforce, a betrayal of Birmingham and a betrayal of UK taxpayers.”

In January 2021 GKN Driveline owners Melrose PLC announced plans to close the Chester Road, with production being moved to plants in Poland and France – making over 500 Erdington workers unemployed.

Hopes were the Erdington factory could play a key part in the electrification of the UK’s automotive sector, building the new propulsion units needed in electric vehicles.

But despite repeated efforts from Unite the Union, Jack Dromey MP for Erdington, and the Chester Road factory staff, Melrose have remained steadfast in their plans to close the Chester Road site.

In a previous statement, Melrose said: “GKN Automotive has fully considered the counter proposals put forward. However, the outlook for the highly competitive automotive market remains unchanged.

“Regretfully, therefore, we are proceeding with our proposal to close the site. Supporting our people continues to be our priority.”

Jack Dromey MP raised concerns over the future of the Chester Road factory when Melrose took over GKN back in 2018.

Since the closure was announced at the start of the year, Mr Dromey has been working with Unite the Union to negotiate a deal to save the Erdington factory.

In response to today’s announcement, setting the date for strike action as Monday September 27, Jack Dromey MP said: “For the past eight months, the 519 workers at GKN Chester Road have fought hard to explore all possible alternatives to closure of the Chester Road site.

“In that time, GKN/Melrose have rejected the workers’ comprehensive alternative business plan and since then have flatly refused repeated invitations to enter further discussions about how to save the plant from closure.

“GKN/Melrose have shown nothing but contempt for the workers and what is at stake for them and their families and also the great damage closure will inflict on the local economy.

“Faced with such intransigence by GKN/Melrose and their intention to push ahead with closure by summer 2022, the workers have been left with no alternative but to take strike action.

“The workers have mine and the local community’s 100% support. As their local MP, I and their trade union, Unite, will continue to explore all options to keep jobs and production at Chester Road.

“We believe there is a way forward and we stand ready to enter any talks to save the plant. GKN/Melrose and the Government must now show the same commitment.”

To find out more about GKN Automotive visit www.gknautomotive.com
For more from Unite the Union visit www.unitetheunion.org
For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk

NEWS: Strike action set for GKN Chester Road factory as workers ‘fight for their jobs’

Words by Adam Smith / Pics supplied by Unite and Jack Dromey MP for Erdington

Workers at GKN Driveline have overwhelmingly voted to strike in the face of the Chester Road factory being closed next year.

Unite the Union held a ballot for industrial action and revealed today 95% of workers who voted wanted industrial action.

Announcing the ballot result Unite declared if GKN’s owners do not back down over closure they “could see strike action hit the plant and customers over the coming weeks.”

There was a turnout of 95% meaning of the 519 workers facing redundancy 93.1% voted to strike.

Unite can now call a strike within the next six months providing they give GKN seven days notice.

In January this year, GKN Driveline owners Melrose announced plans to close the factory and have ignored Unite the Union’s alternative business plan to save the factory.

Unite assistant general secretary Steve Turner said: “This is a tremendous result and shows the determination and confidence of the GKN workforce to fight for their jobs, their community and the long-term future of their plant.

“This is a highly viable plant which could and should be playing a leading role as the UK moves to the electrification of its automotive sector.”

He added: “It is now incumbent that everyone concerned with the future of GKN Driveline including customers, the government, local politicians and GKN’s parent company Melrose PLC, come together to hammer out a future for the plant and the UK’s supply of key components.

“The alternative is a long drawn-out dispute that will damage both GKN and the company’s customer base.

“We have called an urgent meeting of all parties involved and expect both GKN, its customer base, as well as the government, to respond positively to a viable alternative plan to secure the plant’s future.

“The ball is now firmly in GKN and Melrose’s court and how they respond will dictate how this dispute will develop over the coming weeks and months.”

Erdington MP Jack Dromey worked extensively on the alternative business plan for the GKN plant and backed workers plans for industrial action.

He said: “Today’s result sends a clear and unambiguous message to Melrose/GKN that the 519 workers will do all in their power to save the historic Chester Road plant from closure.

“In one of the poorest constituencies in the country, the closure of the Chester Road plant would be a hammer-blow to the local community.

“Generations of local families have been given greater opportunities in life due to GKN, yet Melrose/GKN now want to close the plant without even considering any alternative to closure.”

He added: “The workers have today shown that they will stand up to protect their livelihoods, their local community and the opportunities available for future generations. They remain open to any discussions to avoid industrial action and to keep the plant open. They can be assured of my wholehearted support.”

To find out more about GKN visit www.gknautomotive.com

For more from Unite the Union visit www.unitetheunion.org

For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk

NEWS: GKN workers have ‘exhausted every avenue’ as voting begins over strike at Chester Road factory

Words by Adam Smith / Pics supplied by Unite and Jack Dromey MP

GKN Driveline workers have received their ballots for strike action and union bosses are urging them to vote yes.

Unite the Union held an online meeting last night to discuss industrial action and received messages of solidarity from workers across the world.

GKN Unite convener Frank Duffy, Unite West Midlands Regional Secretary Annmarie Kilcline, and Erdington MP Jack Dromey all spoke at the meeting – as well as some of the 519 workers who face redundancy if owners Melrose close the Chester Road factory.

Workers who are making their minds up about whether to strike have already been threatened by Melrose management.

Frank Duffy said: “Workers have been given letters threatening them if they vote yes in the ballot. They were returned to management and then letters were sent to home addresses but again the workforce brought them into the factory and told management they were not listening. I could not be more proud of them.”

If workers strike they will lose pay and bonuses, but Unite the Union is already fundraising for workers welfare during the potential strike.

Erdington workers have been joined in solidarity by workers in Florence, Italy, where Melrose is also closing a factory, leaving thousands more employees jobless.

Mr Duffy believes they have been forced into taking the last resort, industrial action.

He said: “Melrose has undermined this factory for years, the internal market of GKN consistently meant our factory lost out but we were told it was fine because the rest of the company was profitable.

“There are 51 sites across the world but just one in the UK, where the business started, and they are closing this one. Germany would not allow it; France would not, and our Government should not let this scandal happen.”

“They have paid lip service to the workers throughout this sham, they call it a consultation but I call it a sham, but as soon as they made the decision to close us down in January that was it.

“We have done everything possible, including creating an alternative business plan for the plant, but we were ignored.

“We’ve had seven months of hell but are now at a point when they have to listen to us – that’s why I am urging everyone to vote yes on their ballot for industrial action.”

Erdington MP Jack Dromey has been holding weekly meetings with Unite officials since the Melrose revealed its closure plans, which he warned would happen during its hostile takeover of the British engineering institution in 2016, as well as lobbying the Government to take a more proactive role.

He said: “GKN has a remarkable 262 years of history which can be traced back to when it provided the cannonballs for the British to fight Napoleon. The company contributed to the building of the Spitfire which helped defeat the Nazis.

“The Chester Road factory is a vital part of the future of electrification of the industry and cannot be allowed to close.”

He added: “I know the workers have exhausted every avenue available to them and that is why I am backing their decision to take industrial action.

“For every worker who will lose their job at GKN a further two will lose their jobs in the supply chain.”

Several workers made emotional speeches during the meeting describing how much GKN Driveline means to them and their families.

Robert’s family has clocked up 74 years of work at the Chester Road site with his father and grandfather working at the plant before him.

Stuart Turner said: “I’ve been at the factory near enough from school and I know what a devastating impact its closure will have on surrounding areas like Erdington and Castle Vale.

“We need to send a message that we will not back down.”

Unite West Midlands Regional Secretary Annmarie Kilbride revealed a hardship fund has already been set up in anticipation of a strike for workers who will have their wages docked.

She said: “We need the Government to step in if they are serious about levelling up and keeping skilled jobs in this country.

“I urge everyone to support these GKN workers in whatever way they can.”

The result of the ballot for industrial action will be revealed at the end of July.

To find out more about GKN Automotive visit www.gknautomotive.com
For more from Unite the Union visit www.unitetheunion.org
For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk  

NEWS: Hundreds protest the planned closure of GKN Chester Road factory

Words by Adam Smith / Video & pics supplied by Unite the Union

On Wednesday 7 July, more than 220 people braved torrential rain to protest against the closure of GKN‘s factory on Chester Road in Erdington.

Unite the Union organised the protest in response to owners Melrose International’s announcement the sprawling plant would be closed next June with the loss of 519 jobs.

Workers have taken the first step to strike this summer and are expected to take a ballot on industrial action in the next few weeks.

Union representatives also protested outside Parliament in a bid to force the Government to back their alternative plan for the factory.

A defiant Frank Duffy, Unite Senior Rep, addressed the crowd at Sorrell Park, Pype Hayes, in the shadow of the giant factory.

He told Erdington Local: “We are not giving in. It does not make sense to close this factory, we have proved we can make a profit and we will do everything we can to stop Melrose.

“They want to throw 519 loyal, skilled and dedicated workers on the scrapheap.

“Could you imagine a French or German multinational company shutting its only home plant and moving the work to elsewhere in Europe, there would be a national outcry.”

Unite regional secretary for the West Midlands, Annmarie Kilcline, also attended the protest.

She said: “The protest demonstrated the strength of feeling among workers at GKN and the local community against the plans to close the factory.

“This is a highly viable factory which should be preparing to play a key strategic role in the move to electrify the UK’s automotive industry. Closing the factory would be an act of gross industrial vandalism.”

She added: “It is not just the workers at the factory who would be affected by the potential closure but hundreds of workers in the company’s supply chain and the local community would all  suffer job losses.

“It is essential that the government makes good on its promises to provide assistance and they work with Unite and local politicians to keep this factory open.”

Erdington MP Jack Dromey, who helped draft the alternative business proposal, backed the GKN workers.

He said: “What Melrose is doing to GKN is outrageous, I stand shoulder to shoulder with the workers in Erdington. If they decide to take industrial action then I will support them.”

Speaking at the rally, Birmingham City Council Leader Cllr Ian Ward had messages for both Melrose and the GKN workers facing unemployment.

He said: “Step in now and work with the workers at GKN to save this plant. Anything less is simply a betrayal of the hard-working, loyal & dedicated workforce.

“I assure you the city will stand with you and support you all the way in this dispute”

Despite the viability of the factory and potential massive Government backing Melrose still plan to relocate GKN operations from Chester Road to Poland.

Melrose said: “GKN Automotive has fully considered the counter proposals put forward. However, the outlook for the highly competitive automotive market remains unchanged.

“Regretfully, therefore, we are proceeding with our proposal to close the site. Supporting our people continues to be our priority.”

Unite the Union and GKN workers protest closure of Chester Road factory

To find out more about GKN Automotive visit www.gknautomotive.com

For more from Unite the Union visit www.unitetheunion.org

For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk  

NEWS: GKN Automotive confirm closure of Chester Road factory – rejecting rescue plan from Unite and Erdington MP

Words by Adam Smith

The owners of GKN Automotive in Erdington have confirmed the factory will definitely close with the loss of 519 jobs.

Melrose Industries rejected a rescue plan brokered by Unite the Union and Erdington MP Jack Dromey to save the factory.

A Melrose spokesman said: “GKN Automotive has fully considered the counter proposals put forward. However, the outlook for the highly competitive automotive market remains unchanged.

“Regretfully, therefore, we are proceeding with our proposal to close the site. Supporting our people continues to be our priority.”

Jack Dromey MP warned the Chester Road plant would be in danger when Melrose forcibly took over the firm in 2018.

As well as the 519 workers at GKN an estimated 1,500 jobs could be at risk in the supply chain of the company, which can trace its history back more than 200 years.

He said: “This decision is devastating for the 519 workers at the Chester Road plant. The workers, supported by the union, Unite, worked tirelessly to produce a comprehensive and detailed alternative plan to closure.

“It is therefore fundamentally wrong that GKN/Melrose have now called time on the consultation process and instead intend to push ahead with closure.

“GKN Chester Road is vital, not just to Erdington and the West Midlands economy but also the whole automotive industry in the UK. If the plant were to close, it would be a betrayal of the 519 workers, of British automotive, and the British national interest.”

He added: “I will therefore be seeking urgent discussions with the Chief Executive of GKN and also the Government, who have publicly indicated their commitment to offer support to allow the plant to remain open.

“The workers at GKN and their union, Unite, are determined to keep the plant open. As their MP, they have my total and unending support.”

Unite national officer for the automotive sector, Des Quinn, said: “Unite calls on all interested parties including central government, local government, the supply chain, customers and GKN Automotive to come together and ensure the factory’s future.

“The UK’s automotive sector needs e-drive suppliers and a sustainable supply chain or the entire UK automotive sector is at risk of collapse.

“GKN Birmingham has the ability to supply the e-drives that the UK’s automotive sector desperately needs, it just needs the vision, support and investment to ensure it has a crucial role to play in the electrification of UK vehicles.”

To find out more about GKN Automotive visit www.gknautomotive.com

For more from Unite the Union visit www.unitetheunion.org

For more from Jack Dromey MP for Erdington visit www.jackdromey.co.uk

Mayoral hopeful Liam Byrne MP backs GKN workers – calling proposed Chester Rd closure “unthinkable”

Words by Adam Smith / Pics supplied by the office for Liam Byrne MP

Under-threat workers from Erdington’s GKN Driveline factory held a protest outside the plant’s gates this week.

In February, Melrose Industries announced plans to close the Chester Road site with the loss of 520 jobs – but Unite the Union and local politicians are fighting to keep the factory open.

Labour’s West Midlands Mayoral candidate Liam Byrne MP joined workers on Thursday, calling the closure of GKN Driveline “unthinkable”.

He told Erdington Local: “As a region we need more facilities like GKN in Erdington, not closing them down. I wanted to come to Chester Road to show my solidarity with the workers here. If I am Mayor of the West Midlands in a month’s time, I will be behind everyone at GKN.

“I’m sure they have earmarked the land for housing. But Erdington needs industry, because if you build big housing estates without jobs they will end up being full of unemployed people.”

He added: “We need to leading the way in new green industries, just like Joe Biden is doing in America, and historic industrial infrastructure like GKN should be part of this new economy.

“If elected I will be doing everything to convince owners Melrose to keep these jobs in Erdington.

“We will find a way, a solution to keep this factory open.”

Erdington MP Jack Dromey has been working with Unite the Union to create a business plan to keep the Chester Road factory open.

He said: “These workers are outstanding at what they do and they have been thanked by losing their jobs. There are people here who have worked here for 20 years, people whose family have worked here before them. There are skilled jobs here and they should celebrated not axed.

“Melrose’s representatives said at a House of Commons select committee they would listen to alternatives to closure, and the Government have said they will support an alternative.”

He added: “Melrose need to know they cannot buy a company with 262 years of industrial history and then close down, if they think they will get away with it then they have another thing coming.”

Melrose Industries bought GKN in 2018 in a controversial hostile and promised to keep the Erdington plant open. GKN can trace its history back to the Industrial Revolution in the 18th century and has been at the forefront of engineering in the UK ever since, the Erdington site assembles automotive parts.

Frank Duffy, GKN‘s Unite convenor at the Chester Road plant, said: “We have got more than 500 workers here and we are not giving in. We are not working on the premise that the factory is closing because it makes no sense.

“We have not been given redundancy terms yet which is a good sign the factory can remain open.”

To find out more about GKN Automotive visit www.gknautomotive.com

For more from Unite the Union visit www.unitetheunion.org

For more on Liam Byrne MP visit www.liambyrne.co.uk  

NEWS: GKN Automotive to close Chester Road site making over 500 unemployed

Words by Adam Smith

Erdington’s sprawling GKN Automotive factory, Chester Road, is being closed down with the loss of more than 500 jobs.

GKN‘s owner Melrose Industries announced the news, which will bring down the curtain on one of the UK’s oldest engineering assembly lines, to shocked workers this week.

Workers were informed of the decision through a letter from GKN Automotive chief Liam Butterworth, who said: “GKN Automotive has taken the difficult decision to propose the closure of our assembly site at Chester Road, Birmingham.

“Sadly, an increasingly competitive global market means that the site is no longer viable. This is despite significant effort and investment over the past 10 years to reduce the site’s high operating costs and make it competitive.

“Supporting our people is our first priority as we consult on this proposal. Employees at the site are being notified today and support is being made available to them throughout this process. We will then commence a period of consultation with the union and employee representatives in the coming weeks.

“We expect this proposal to impact 519 employees. The proposal envisages that GKN Automotive will carefully wind down the site over 18 months to ensure an orderly and stable transition of operations and give those affected time to find new work. The proposal is to transfer production to other sites in our network.”

Melrose Industries bought GKN in 2018 in a controversial hostile takeover in which they promised to keep the Erdington plant open. GKN can trace its history back to the Industrial Revolution in the 18th century and has been at the forefront of engineering in the UK ever since, the Erdington site assembles automotive parts.

The restructure will not affect GKN’s plants in Sutton Coldfield and Minworth.

Unite national officer Des Quinn said: “The workforce have been left shocked and angry to learn that management is looking to close this highly viable site.

“Unite is now seeking urgent meetings with senior management at GKN to understand the business case and the logic behind this decision.”

He added: “Unite is committed to working with GKN to find a feasible solution, which will keep the factory open and preserve the jobs of this highly skilled workforce.”

Erdington MP Jack Dromey opposed the £8.1 billion takeover in 2018 warning the British multinational Melrose Industries would cut costs and jobs.

He said: “Despite all the warm words by Melrose in 2018 to protect the future prosperity of GKN and its British workforce, the cold reality three years on is that one of GKN’s finest plants now faces closure. Melrose promised a bright future to GKN’s employees – a promise they have now broken.

“This announcement is completely unexpected by employees at GKN. Working together with their trade union, Unite, I will be seeking an urgent meeting with the company.

“Government Ministers also have a responsibility to act after promises they made at the time of the hostile takeover.”

A spokesperson from GKN Automotive said: “Proposing this closure is a difficult decision which has been made despite significant effort and investment over the past 10 years to reduce the high operating costs at the Birmingham assembly site.

“Sadly, an increasingly competitive global market means that the site is no longer viable. Supporting our people is our priority as we consult on our proposals.”

John Taylor Hospice’s former press officer and Pype Hayes resident Ray Woods lamented the closure of the factory and its impact on the community.

He said: ”My thoughts are with the employees of GKN in Pype Hayes. They and their former senior management helped to raise thousands of pounds for John Taylor Hospice. They should be very proud.

“This is another blow for Erdington and the local community.”

To find out more about GKN Automotive, visit www.gknautomotive.com

For more from Unite the Union, visit www.unitetheunion.org

EXPLOITED: Part 3 – The unchallenged rampage of HMOs and shared houses, wreaking havoc for a profit across our community

Words by Adam Smith

In the third instalment of EXPLOITED, Adam Smith looks at the oversaturation problem in the HMO and supported living sector – hearing from the top of two housing associations and going right down to the root cause of the misery.

It’s a license to print money,” one former employee of a housing association tellingly revealed.

And it stands to reasons where there is easy money on offer there will be a queue of people ready to take it.

On the Birmingham City Council website there is a list of HMOs where landlords can charge the benefits system £900 for a room, which often can be more than £500 over the private rented market value. And the list runs into the thousands.

Across Birmingham there are 2345 HMOs with six or more people living in them, with applications pending for another 758 properties – including houses in Mere Road, Queens Road, Chester Road, Hillaries Road, Norfolk Road, Kings Road, Slade Road and George Road in Erdington.

As well as the licensed HMOs there are thousands more smaller HMOs and shared houses which fall into the category of ‘exempt’ or ‘supported’ accommodation. There are hundreds of companies which can apply for an HMO license in Erdington, many of which have been arguably set up just to take advantage of the system.

Spring Housing Association (SHA) is a Birmingham based Housing Association which operates HMOs, hostels and social housing – an organisation that has been referenced in previous Exploited articles. SHA has close links to Birmingham City Council and is one of the biggest housing associations in the Midlands, managing or owning more than 700 properties.

SHA, which has Edgbaston MP Preet Gill on its board of directors, has lobbied the Government to tighten up regulations and is now even turning shared houses into family homes.

SHA group chief executive and founder, Dominic Bradley, told Erdington Local there should be tighter regulations on the mushrooming number of companies which can run HMOs and shared accommodation.

He said: “We believe that there is over saturation of exempt shared housing provision in Birmingham. This is not to say that this type of housing doesn’t have an important part to play in the prevention of homelessness in all of its forms. In fact it’s essential.

However, we have long recognised that in parts of the city we are over saturated with this style of housing – which is disruptive to local communities. Stockland Green is an obvious example of this.”

Dominic added: “It’s one of the reasons we are about to purchase a shared house in Erdington and convert it back to a family home. We are aiming to do something similar in Edgbaston, which has had similar community issues to Stockland Green.

Whilst this is a start and one we are keen to develop further there are wider more systematic issues that need to be tackled around strengthening existing regulations about what we mean about care, support and supervision and work with providers to curb the current unmitigated growth and target provision linked to local strategy which we know Birmingham City Council are very keen to achieve.”

In the last article, Exploited – Humans Must Obey,  we outlined the rules tenants have to follow whilst living in supported housing and HMOs.

In the housing sector the term used is ‘Exempt Accommodation’ because in 1996 Housing Benefit regulations were changed to include ‘non-commissioned EA’ which were defined as ‘accommodation which is…provided by a non-metropolitan country council, a housing association, a registered charity or a voluntary organisation where that body or a person acting on its behalf also provides the claimant with care, support or supervision.

‘If a provider or landlord meets these criteria, they are exempt from rent restrictions within the private rented sector and are able to yield rent levels, paid for from housing benefit, far in excess of ‘general needs’ social sector rents and, often, market rents.’

These two paragraphs provided the starter of the sector gun, as landlords and housing associations realised they could charge more rent without the hassle of tenancy agreements – and the introduction of Universal Credit in 2012 massively increased the sector. The Conservative government’s change of rules, that the tenant received the housing benefit and not the landlord, meant it made sense for landlords to claim their houses were ‘exempt’ so they could get the cash directly as had been the case for decades.

The last Parliamentary research into HMOs, published in 2019, revealed there were more than 497,000 HMOs in England in Wales in 2018. And that number is growing.

Spring Housing Association, the University of Birmingham, and Commonweal Housing combined to produce a 60 page report – Exempt from Responsibility? Ending Social Injustice in Exempt Accommodation – which detailed the shocking state of housing provision and detailed how thousands of people were stuck in negative housing situations across the city. 

Ashley Horsey, chief executive of Commonweal Housing, a charity formed to ‘implement housing solutions to social injustice’, described the damage exempt housing is doing to tenants and communities.

He said: “The findings of this report are stark. That over 11,000 people in Birmingham – and many thousands more across the country – are living in potentially unsafe and unsuitable ‘exempt’ accommodation should concern us all.

Residents interviewed for this report described feelings of ‘entrapment’ in financial instability; exclusion from decision-making processes; lack of control over where, and with whom, they are housed.

At the same time, the nature of too many of the business models involved in this space are causing some concern, not least inflation linked leases from property owners requiring ever rising rents.

In addition, the deficit-based tenant modelling – talking up your tenant’s weaknesses to justify your income stream – is all too common, and a tricky place to be morally. Especially where there remains little oversight.”

Ashley added: “The ‘don’t ask don’t tell’ nature of some of the governance and regulation of this sector is alarming. Of course, everyone accommodated in the exempt accommodation sector is in need of a home. But asking no questions simply because this sector is putting a roof over a head is not good enough.

In particular, the exempt accommodation sector is too often the only housing available for the marginalised, the overlooked, the undervalued and the de-valued in society. They are the women who find themselves here after fleeing domestic violence, as their only housing option.”

The next instalment of EXPLOITED will reveal the shocking stories of women who have either lived in, live in, or have been affected by HMOs, exempt, or shared housing.

To read Exempt from Responsibility? Ending Social Injustice in Exempt Accommodation, visit www.springhousing.org.uk/wp-content/uploads/2019/11/Spring-Housing-Final-Report-A4.pdf

To read the 2019 Parliamentary briefing paper on HMOs, visit www.commonslibrary.parliament.uk/research-briefings/sn00708 

For more on Spring Housing Association, visit www.springhousing.org.uk

For more on Commonweal Housing, visit www.commonwealhousing.org.uk

If you have been affected by HMOs or any of the issues mentioned in this article, we want to hear your side of the story – email Erdington Local on exploited@erdingtonlocal.com