House of Commons inquiry into Kraft takeover of Cadbury

MPs are to hold an inquiry into the takeover of Cadbury by US food giant Kraft and the controversial move to close a factory with the loss of 400 jobs.

The business select committee will question senior officials from Kraft at a special Commons session early next month.

The committee’s Conservative chairman Peter Luff said he felt he had no choice but to make the move amid criticism of the US firm and of the Government.

Mr Luff said MPs wanted to know why Kraft went back on its pledge to keep open the Somerdale factory near Bristol.

The plant was earmarked for closure by Cadbury after the chocolate-maker said it would transfer work to Poland.

But while Kraft was bidding to buy the British company it said it would keep the factory open, only to announce its closure after the buyout was completed.

“The Government said it opposed the takeover, then welcomed the deal, but then criticised Kraft for closing Somerdale.

“Fresh hope was given by the Government and Kraft about this factory and it is time someone took them to task. We also want to know what Kraft’s plans are for Cadbury and whether we can trust them,” said Mr Luff.

Hundreds of Cadbury workers staged a protest in Westminster on the day the deal was sealed earlier this month, raising fears for their jobs and criticising the Government for not doing enough to safeguard employment.

Just days later Kraft said it had changed its mind about the Somerdale plant and will close it after all by next year.

Union officials are also set to give evidence to the select committee during the inquiry.

Unite welcomed the news and said Kraft and Cadbury executives should explain their part in the “most unpopular corporate takeover” in recent times.

The union said it was a matter of national importance that both companies were held to account, claiming that both firms had evaded scrutiny of their plans during the takeover process, hiding behind “secretive” UK takeover and keeping workers in the dark.

Deputy general secretary Jack Dromey said: “In the past week Kraft has shocked Britain by blithely backtracking on promises made on Cadbury jobs, and two more Cadbury directors cash in handsomely on the sale. Our lawmakers must hold those responsible to account.

“The committee’s intervention must now bring us one step closer to securing cast iron guarantees for the future and a Cadbury Law because never again should one of this country’s manufacturing jewels succumb to a hostile takeover.”

Jennie Formby, Unite national officer for food and drink, added: “Both companies, but particularly Kraft, have many important questions they must answer to the people of this country, not least to 6,000 very anxious workers.

“They are reeling from Kraft’s cynical misuse of the Somerdale workforce to deflect public hostility to their bid and are now asking can this company be trusted to honour redundancy pledges made too.

“For months Kraft has refused to come clean to either the workers or our Government on its plans. The select committee must make sure they cannot slip scrutiny any longer.”

Unite said it was increasingly concerned that Kraft could renege on promises over pensions and redundancy made to the Somerdale workforce who are to lose their jobs by the end of the year.