Windfall for group that sacked 800 P&O workers
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The Dubai-owned company that admitted it had broken employment law by dismissing 800 British crew at P&O Ferries last March and replacing them with cheap foreign labour has been awarded a multimillion-pound windfall under Rishi Sunak’s freeports scheme, in what unions condemned as an “appalling” decision.
DP World, the ports and shipping empire controlled by the emirate’s sovereign wealth fund, has had its business plan approved to co-run the 1,700-acre Thames Freeport in Essex, entitling the company to benefit from taxpayer cash and tax breaks, only a year after the mass-sackings.
The company, which is run by Sultan Ahmed bin Sulayem, sacked the staff by video call and hired foreign seafarers who sometimes earn less than £4 an hour, according to the Trades Union Congress. The government, at the time, said it was “appalled”.
Sunak made freeports a key part of his vision for British economic reinvention after Brexit when he was chancellor. Under the scheme, which he launched in 2021, eight sites are to be transformed into low-tax zones, with manufacturers based there importing goods exempt from tariffs. Companies will also be able to claim lower property taxes on new buildings and benefit from lower levels of national insurance on new staff.
The Thames Freeport will be run across three sites in Essex and east London in a partnership between DP World, Forth Ports and Ford. It is made up of DP World’s vast London Gateway site in Thurrock, which is the size of 400 football pitches, the Port of Tilbury near Southend-on-Sea owned by Forth Ports, and Ford’s Dagenham plant.
Last week the government approved the final business case for the project, allowing it to formally constitute its board, and begin to operate fully. This will entitle the port to receive £25 million in government funding and allow the port to press ahead with attracting £4.6 billion in public and private investment to generate 21,000 new jobs.
Paul Nowak, general secretary of the TUC, said: “This is an appalling decision. DP World oversaw the brutal, and illegal, sacking of 800 workers at P&O ferries. Ministers should have stripped the company of all its public contracts and severed commercial ties. But the government has chosen instead to reward DP World with another bumper deal. This is giving a green light to other rogue employers to act with impunity.”
Last summer, when asked if it would give its approval for Thames Freeport, the government appeared to suggest it was considering carefully whether to turn down the plans. A spokesman told The Times: “The government has been clear that we are appalled by the way P&O have behaved towards their employees and DfT ministers have raised this directly with P&O company chiefs.
“We have not yet approved the full business case for the Thames Freeport, and are working to establish whether DP World are in breach of any of the requirements. They have not received any capital funding from government.”
Last week, it emerged that directors and key managers shared more than £15 million, including bonuses, in 2022 up from £14.6 million in 2021.
The company had also been accused by HM Revenue & Customs of avoiding stamp duty over its original £113 million purchase of the London Gateway site in 2010, although it is “vigorously contesting” the demand and will fight it at a tribunal.
A spokesperson for Thames Freeport said the three participants in the scheme had invested £2.5 billion in ports and logistics infrastructure over the past ten years, with £3 billion of further investment planned including a £350 million new berth at DP World’s London Gateway port. He added that 21,000 new “direct and indirect jobs” would be created by the project.
A government spokesman said: “This approval means that the freeport will now receive up to £25 million from the government and potentially hundreds of millions in locally retained business rates. This funding will go to local authorities in the freeport area and will be used to benefit the entire region.”