l In mid-August, British Coatings Federation (BCF) president Peter Rieck wrote to Patricia Hewitt at the UK Department of Trade and Industry asking for official recognition of the critical state of UK manufacturing and calling for appropriate and urgent action to be taken.
According to BCF, the situation is most severe in the industrial coatings sector where sales have been falling at an annual rate of 10% with June figures showing the seventeenth consecutive monthly decrease. General industrial coatings, wood finishes for the furniture industry and printing inks have taken the hardest hits. BCF contends that “profits continue to fall with 40% of firms in the industrial coatings sector now trading unprofitably, with 80% of all participants in a recent survey reporting lower gross margins than a year ago.”
BCF’s letter also noted that employee numbers fell five percent in the last year, the largest decrease since 1996, while new investment is down 20%. In addition to declining sales, BCF cited increasing labor costs, energy and other environmental taxes and the disproportionate burden of EU legislation as enacted and enforced in the UK as “serious threats” to UK competitiveness.
The plan of action submitted to the government by the BCF included a reduction of the legislative load, a 12-month delay in implementing costly forthcoming EU labeling laws and the introduction of smaller industry direct support to encourage investment in R&D and environmental schemes.