Business leaders have welcomed a £50 million pledge by Cadbury owner Kraft Foods – despite plans to cut 200 jobs.
US firm Kraft, which sparked fears when it took over Cadbury in 2010, plans to cut the jobs as part of a productivity push in its UK chocolate and biscuit manufacturing operations.
Kraft said its proposals were designed to keep Bournville, the Birmingham-based home of Cadbury’s chocolate, at the heart of the industry, and to bring biscuit-making to Kraft in the UK for the first time.
Michael Ward, president of Birmingham Chamber of Commerce, said the move would keep Bournville at the heart of the British chocolate industry.
He added: “We understand the drive to improve productivity in chocolate manufacturing and job losses, while regrettable, will be phased in over two years from March 2012.
“Low-productivity has been a drag on West Midland’s manufacturing for decades and too many businesses are still not improving productivity fast enough.”
Mr Ward said that today’s announcement, which puts £44 million into chocolate manufacturing sites at Bournville, Chirk in North Wales and Markbrook in Herefordshire, is about keeping a local iconic brand as internationally competitive as possible through a long- term strategy.
“Productivity is a race without a finish and Kraft offers a great example to other manufacturers. But no business can give job number guarantees,” he said.
“What can be guaranteed is that businesses that drive up productivity stand the best chance of securing their future and supplying long-term, sustainable jobs.”
The company, which bought chocolate giant Cadbury, said it will be making “significant investments” across four of its sites over the next two years.
But 200 jobs will be cut through redeployment and voluntary redundancies over two years from next March.
Kraft said that in March last year, following its acquisition of Cadbury’s, it made a series of commitments to employees, including no further plant closures and no compulsory redundancies in UK manufacturing for two years.
The firm said these commitments remained “fully in force” and were not changed by today’s announcement.
Kraft was criticised for closing Cadbury’s Somerdale factory near Bristol after saying it wanted to keep the site open before the takeover.