IoD warns of millions lost due to rail strikes
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Your support makes all the difference.ESCALATION of the rail strikes will cost British business millions of pounds in lost production as companies are starved of materials, says the Institute of Directors.
A spokeswoman for the IoD said yesterday that modern 'just-in- time' manufacturing techniques left companies without stockpiles of raw materials to fall back on. Continued disruption would force companies to give up using rail in future as a means of moving goods.
'Interruptions in the flow of production are not what you want at this stage in the economic recovery,' she added.
British Steel, British Rail's third largest customer, could not quantify the impact of the strikes so far. But a spokesman for the company, which spends pounds 70m a year with BR, said: 'Further disruption could affect long-term transport decisions.' British Steel moves 18 million tonnes of raw material a year by rail.
The railways' biggest customers are the power generators, National Power and PowerGen. They are buffered by huge coal stockpiles at power stations, which they are trying to run down. The strikes have come at a time when there is a downturn in power consumption.
Businesses in general claim to have been no more than inconvenienced by the difficulty faced by staff in getting to work. The Confederation of British Industry said between 70 and 85 per cent of staff were getting in somehow.
Shell UK, which employs about 1,600 people near Waterloo station in London, said that 85 per cent managed to get to work last Wednesday compared with 50 per cent on the first strike day. This week the company plans to run 20 coaches from outside London at a cost of up to pounds 500 a coach each day.
IBM, also a major employer on the South Bank, said that employees having difficulty could log on to a computer terminal in a local branch and work normally. BT said its policy of 'teleworking' from home helped to offset the effect of the strikes.
The CBI's main concern is that high-street businesses in cities will lose trade. However, the evidence, confirmed by the Dixons retail chain, is that lost business is being transferred to local and regional stores as people work from home.
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