LONDON, Sept 11 (Askume) – The British government said on Wednesday it had offered better conditions to 2,500 unemployed steelworkers and provided Tata Steel with a 500 euro loan to help decarbonise its Welsh plants , with investment promised.
The Labour government elected in July revised the deal of the previous Conservative government and said it would provide better conditions for unemployed workers at the Port Talbot plant, and India’s Tata PLC promised to consider new investment.
Tata said in January that closing two blast furnaces at Port Talbot would put 2,800 jobs at risk and planned to shut them by 2023, with a loss expected next year, as part of a government-backed plan to move to low carbon.
Trade and Commerce Secretary Jonathan Reynolds said on Wednesday the government will publish a British steel industry strategy next spring aimed at boosting an industry that has been in decline for decades due to low-cost imports.
“This government is taking strong action through a new deal and strategy to address the sector’s sustainability issues and set out a long-term vision for a bright and sustainable future,” Reynolds said in a statement.
He said the government plans to invest £2.5 billion in the steel industry, in addition to the £500 million being invested by Tata. The government said about 2,000 Tata employees have expressed interest in voluntary layoffs.
Before Tata began shutting down its blast furnaces – the second of which will be shut this month – the company said it was losing £1 million a day, underlining the scale of the challenge facing British producers.
Chinese-owned British Steel, which has two blast furnaces at Scunthorpe in northern England, is also in talks with the government about moving to cleaner production.
Switching to electric furnace steelmaking is expected to reduce UK carbon emissions by 1.5%, as the Port Talbot coal-fired power station is the UK’s biggest single carbon emitter.
Under a new agreement between Tata and the government, Tata will assess future investment opportunities in the UK steel industry and pledge to retain 5,000 jobs at its UK operations following job losses due to blast furnace closures.
The government has said that it can withdraw its investment if Tata backs out of the deal.
($1 = 0.7645 British pounds)
