Velux uses EU funds to outsource to eastern Europe – The Post

Velux uses EU funds to outsource to eastern Europe

Window producer handed 12.5 million for new factory in Hungary

The move resulted in 100 people lost their jobs in Copenhagen (photo: Velux)
July 15th, 2015 10:23 am| by Christian W

Velux uses EU funds to outsource to eastern Europe

The Danish window producers Velux has become the latest Danish company to outsource its activities to eastern Europe supported by a million-kroner grant from the EU.

Velux has decided to move its production to Slovakia, Poland and Hungary and has been granted 12.5 million kroner from the EU Commission for its new factory in Hungary.

“The commission evaluated that our application satisfies the conditions and has granted us support, which has been utilised on new production technology,” Michael K Rasmussen, the head of marketing in Velux, told DR Nyheder.

The move cost 100 people their jobs in Copenhagen, while 180 people in Scotland have also found themselves looking for new jobs.

READ MORE: Every fourth Danish food product company looking to outsource

Paid to outsource
But the move has attracted criticism from several front, most notably from the labour union arena which has been irked that Danish companies moving Danish jobs east while being given EU support.

“I think it is grotesque that companies can receive EU support for the production they have outsourced,” said Mads Andersen, a spokesperson for labour union 3F. “It should be tightened up so they can only obtain support if they can document that its new production and not something they’ve simply moved out.”

The EU distributes about 100 billion kroner every year for regional development within its border. The aim is not for the funds to be used for moving jobs, the EU Commission underlined.

“Our position in the European Commission is clear,” said Jakub Adamowicz, a spokesperson for the EU Commission. “The goal of the structure funds is social development. The target is not to encourage investments which move jobs.”