Around 2,000 South Yorkshire steel workers have been ‘cut adrift’ by the apparent withdrawal of Government support, an MP has warned.
Wentworth and Dearne MP John Healey has said Business Secretary Sajid Javid has ‘abandoned his pledge’ that a Government-backed package of support worth hundreds of millions of pounds would be available to potential buyers of Tata Steel’s UK operations.
On Friday, the company announced it was going ahead with the potential sale of its speciality steel operations in Rotherham, Stocksbridge and Hartlepool - but dropping the previously-planned sell-off of the other parts of its British operations.
Mr Javid said on Monday that the Government’s offer of support remains in place in relation to other elements of the business as Tata explores a joint venture deal.
Mr Healey has written to Mr Javid asking him to clarify what offer of support, if any, remains on the table for the South Yorkshire sites.
He said workers ‘simply don’t know where they stand or what future there is in South Yorkshire steel-making’.
Mr Healey told Mr Javid: “As it stands, you have announced a massive change in Government policy without acknowledging this, and the Government is turning its back on the steelworkers and steel communities of South Yorkshire.
“The statement completely cuts adrift 2,000 of those dedicated highly-skilled men and women who work in Rotherham, Stocksbridge and Hartlepool.”
Tata announced in March it was looking to sell all of its British plants, with seven potential bidders shortlisted in May.
But the company announced on Friday that its strategy was changing, following uncertainties relating to the EU referendum result and a Government consultation on the costs of the pension scheme for steelworkers.
South Yorkshire MPs, including Mr Healey, are due to meet business minister Anna Soubry about the situation tomorrow.
Mr Javid said today: “Since Tata Steel announced its intention to restructure its UK operations, the Government has worked closely with Tata, potential buyers and other stakeholders including the trade unions and the Welsh Government, to ensure a sustainable future for the business. We remain committed to that objective, and to ensuring the continuation of primary steelmaking in South Wales.
“Following the referendum on the UK’s membership of the EU, and a review of the bids received for Tata Steel UK, the Board of Tata Group announced on Friday 8 July its intention additionally to explore options for retaining ownership of the business with strategic partners, including through a possible joint venture with ThyssenKrupp AG. Discussions are at a preliminary stage.
“Tata has also announced its intention to sell separately its speciality steel business based in Rotherham and Stocksbridge, as well as two mills that produce steel pipes based in in Hartlepool. Around 2,000 of Tata’s UK workforce are employed in the businesses that will be sold. None of the businesses that will be sold are supplied with steel from Port Talbot, and are separate business units within the group.
“The Government is committed to working with Tata to achieve that objective.
“We will remain in close contact with Tata during the sale process for the speciality steel and pipes business units, and as they develop their plans for the strip products business. The Government’s offer of support via an equity stake and/or loans on commercial terms to a future owner of the strip products business, which includes the operations at Port Talbot, remains.”
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