Call for 'urgent' action on UK steel

The sector has recently been rocked by the recent news that Teesside’s Redcar plant would close causing the loss of 2,200 jobs. Now, Tata Steel is also widely reported to be planning 1,200 job cuts.

Its Scunthorpe steel plant, as well as some sites in Scotland, are tipped to bear the brunt of these cuts.

I cannot emphasise enough that there is an urgency here and very little time before we start to see more job losses and companies facing intolerable pressure. This really is about saving Britain’s steel industry and time is of the essence

UK Steel’s Gareth Stace

These developments are the result of substantial falls in the price of steel in a lacklustre global market, exacerbated by currency devaluations in other steel-making regions such as China.

At last week’s industry summit the government said it would establish working groups chaired by ministers to investigate three key areas.

The first of these is public procurement, where it will seek to boost the number of contracts won by UK steel manufacturers ”in fair and open competition”.

It also plans to undertake international comparisons, in order to ”consider what lessons can be learned from other countries in the EU and beyond”.

Another working group will examine competitiveness and productivity, as it relates to energy and environmental costs, business rates, regulation and activities that might boost competitiveness from within the industry itself, such as skills and training initiatives.

“There is no straightforward solution to the complex global challenges facing the steel industry,” said business secretary Sajid Javid. “But today was an important opportunity to bring the key players together and we now have a framework of action.”

Gareth Stace, director of trade association UK Steel, said: “While it may have been too much to expect immediate decisions, we are cautiously optimistic that the urgent recommendations we have made – from compensation to cut the cost of energy to tackling unfair dumping of steel by China – are all now at the top of the Secretary of State’s to-do list.

“But, I cannot emphasise enough that there is an urgency here and very little time before we start to see more job losses and companies facing intolerable pressure. This really is about saving Britain’s steel industry and time is of the essence.”  

He is also urging the Prime Minister to raise the issue of Chinese steel prices with the Chinese Premier during his visit to Britain this week.

John Cridland, director-general of the Confederation of British Industry (CBI), said:  “Developments at steelworks in Scunthorpe and Scotland are devastating, particularly for those who have lost their jobs and the wider local community.”

He said the government must work in partnership with businesses on a long-term industrial strategy.

“It should also act to guard against excess market supply, support industry by removing plant and machinery from business rates calculations, and secure lower costs for energy intensive industries to help make steelmakers more competitive in the global marketplace.”

Ann Watson, chief executive of Semta, the manufacturing skills body, said she was ‘mortified’ by recent developments on Teesside, Scunthorpe and Scotland.

“Any job losses are terrible for the men, women and families that they affect,” said Watson.

“But these job losses could prove catastrophic for industry – and the nation.”

She has called on the government and industry to form a taskforce to process this transition.