Aid plea for Airbus jobs

THE Government faces mounting pressure this week to give £380m of aid to make high-tech wings for the latest Airbus - or lose the opportunity to create at least 11,000 new jobs.

There are fears that if launch aid is denied, the work will go to Germany and Italy, where the governments have made it clear that they are desperate to win the contract.

On Tuesday, shop stewards representing 6,000 workers at the Airbus plant in Broughton, Flintshire, will lobby Trade and Industry Secretary Alan Johnson, who is considering the application.

Financial Mail understands that the DTI believes there is a strong case for supplying aid, provided the conditions are right and that all the work will be undertaken in the UK.

And the DTI is supported by Tony Blair. When the Prime Minister visited the North Wales factory in April, he told workers' representatives that it was important that the wings for the A350 passenger jet were built in this country.

According to Airbus, the decision to give launch aid would create 10,800 new jobs directly and another 21,000 indirectly, because of sub-contracting. The new technology associated with the aircraft's composite wings would put the UK at the cutting edge of advanced research into the use of composite materials.

At present, most wings are made of metal. The wings of the future are expected to be made from carbon fibre composites. The request for aid is expected to be approved by the DTI in the next two weeks and then formally passed over to the Treasury.

However, the Treasury believes that the DTI should pay for the aid. The Prime Minister may well have to resolve the issue. And approval for the funds could inflame the row between Airbus and America's Boeing over state aid.

It could lead to expensive litigation at the World Trade Organisation, which is the forum to resolve such disputes.