UNION leaders called on the Scottish Government to step in to save more than 300 workers at a Fife paper firm from the “scrapheap” after it plunged into administration.

Unite said it was outraged that the jobs blow comes just weeks after a new £200 million combined head and power (CHP) biomass plant was opened on the site last month with promises from their bosses and Energy Minister Fergus Ewing that it would safeguard 500 jobs.

Markinch-based Tullis Russell Papermakers called in administrators after experiencing a long-term decline in its market and cumulative losses of £18.5 million over the last five years.

Steps begun last year to find a buyer for the business also proved unsuccessful.

Joint administrators Blair Nimmo and Tony Friar of KPMG were appointed and concluded there was no option but to reduce the size of the workforce. This has led to 325 employees being made redundant “with immediate effect”.

The remaining 149 workers have been retained at this stage to complete some orders.

Nimmo, head of restructuring for KPMG in Scotland, said: “This is a sad day for the employees of Tullis Russell Papermakers, who have worked hard against the significant headwinds facing the global paper-making sector.”

Unite urged the Scottish government to intervene to save the employee-owned paper manufacturing firm.

Unite Scottish Secretary Pat Rafferty said:“Last month the Scottish Energy Minster Fergus Ewing heralded a bright future for the Markinch workers with the opening of the new biomass plant, aided by a public subsidy of over £8m. We know that the company has been seeking a new buyer but it is remarkable that in such a short space of time 325 jobs can go from being safeguarded to the scrapheap, while a further 149 posts are put on notice.

“Our members on the employee board have had no communication or consultation from the directors that the company would be put into administration – it is totally unacceptable.

“Unite is calling for immediate intervention by the Scottish government to restore the employment status of the workers made redundant today and to save the future of this site.”

Reacting to the news, First Minister Nicola Sturgeon announced a taskforce to support economic growth and employment across the area affected by the job losses. The Joint Taskforce for Fife will be chaired by the Scottish Government and Fife Council, with Deputy First Minister John Swinney leading for Scottish ministers.

Sturgeon said: “I am very concerned to learn of the job losses at Tullis Russell in Markinch. This will be a deeply anxious time for the workers, their families and the local community.”

The taskforce will focus particularly on Glenrothes and the central Fife areas.

The First Minister said: “It will work with the administrators to try to secure an alternative owner and it will look for ways to help mitigate the effects of job losses by putting in place appropriate support for workers to help them back into new jobs and training.

“I know that people in Markinch and across central Fife will be worried. I would like to assure them that the Scottish Government stands ready to help in any way we can.”

Tullis Russell Papermakers is a wholly-owned subsidiary of Tullis Russell Group Limited.

Group CEO Chris Parr said the directors of the paper-making business were faced with no other option than to place the business into administration. He said: “This is a terribly sad day.”