Tata Steel workers facing job cuts in Britain have been thrown a lifeline with a £9 million support package put together by the government and the Indian steel giant.
The government will provide £6m of the total £9m package, the government and Tata Steel said in a statement last Friday (23), days after Britain’s biggest steelmaker announced the lay-off under a restructuring deal to cope with a “flood of cheap imports” mainly from China.
It will give £3m to match Tata Steel’s funds to provide support for more start-up businesses and companies looking to expand and create jobs.
In addition, it is separately providing up to £3m specifically for training of affected employees through local Further Education (FE) colleges to help the employees upskill for the wider job market.
“Tata Steel’s regeneration arm UK Steel Enterprise has pledged £3 million to support jobs creation in Scunthorpe, on top of £10 million it has already earmarked to help regenerate UK steel communities over the next five years,” it said.
UK Steel Enterprise, a subsidiary of Tata Steel, has pledged £3m to support workers in Scunthorpe in the West Midlands where its steel plant is to restructure.
“This is a very difficult time for the workforce, so it is important that the government and the company come together to support people and the local economy,” business secretary Sajid Javid said.
He added: “The government has no intention of simply standing aside while the steel industry faces global challenges on a scale unprecedented in recent years. We will do everything we can to help workers and to ensure a level-playing field for the industry.
“Tata Steel has a strong track record of creating jobs and supporting local communities right across the country, and its commitment to this package today is to be commended.”
Tata Steel’s UK Steel Enterprise is also providing an additional £1.5m to support jobs creation in steel communities around its Dalzell and Clydebridge sites in Scotland.
The British government said it is continuing discussions with the Scottish government about further support.
Karl Koehler, chief executive of Tata Steel’s European operations, said: “I recognise this is a challenging time for the employees affected by the restructuring we announced.
“We are committed to doing everything in our power to support those impacted, and through UK Steel Enterprise we will help create new jobs in the affected local communities.
“The UK steel industry is facing extremely challenging circumstances and we welcome the government’s pledge to match our funding package for those affected.”
The Indian steel major had confirmed a restructuring at its UK unit last Tuesday (20), which will lead to 1,200 job losses.
The firm blamed cheap Chinese imports causing steel prices to fall steeply for the mounting crisis in the British steel industry.
Around 900 jobs will go at Scunthorpe in northern England and 270 in Scotland as well as a small number at other Long Products Europe sites.
Plate mills in Scunthorpe, and Dalzell and Clydebridge in Lanarkshire, Scotland, will be mothballed while one of the two coke ovens at the Scunthorpe steelworks will be closed.
The general secretary of the Community steelworkers’ union, Roy Rickhuss, said: “Although any support for steel communities is to be welcomed, both Tata Steel and the government are putting the cart before the horse.
“There is still a consultation process to go through and no worker will be redundant until that is completed.”
Workers last Friday held a protest in Oldbury in the West Midlands where steelmaker Caparo Industries, which employs about 250 people, last week went into administration.