Bosses at Tata Steel have raised concerns about the impact Britain’s July 4 general election could have on its £1.25 billion plans at its Port Talbot site.
The company said it was “concerned” about the closure of heavy assets and a restructuring program following media reports on Monday, June 10. which was outlined earlier this year.
Labor yesterday reiterated calls for Tata Steel to wait until the party is in government before closing blast furnaces that will cost thousands of jobs in south Wales.
Tata Steel is switching to a greener form of production using an electric arc furnace – which requires fewer workers, putting jobs at risk.
Visiting Tata Steel in Port Talbot on Monday, Sr Workers urged the company to delay shutting down all blast furnaces.
Instead, they urged the company to wait for a possible Labor government next month for fresh talks to take place, with the hope that the firm will accept the union’s plan to keep one furnace running while it switches to green steel production.
The visit came as steelworkers said they would ban overtime as part of industrial action to protest job losses starting June 18.
Tata Steel raises concerns about general election impact
Tata Steel said in a statement: “We are therefore concerned to read UK media reports suggesting that the £1.25bn investment, the largest in UK steelmaking for many decades, may be at risk due to policy differences expressed by the Conservatives and the Labor Party. parties, in the current election period.
“We call on and ask the current and incoming governments after the election to honor and protect the agreed terms of the £500m support package for the Electric Arc Furnace (EAF) project announced in September 2023.
“This project has been developed to ensure the production of low-emission, high-quality steel in Port Talbot, preserve primary steelmaking in Britain and create the potential for a future green manufacturing cluster in South Wales.
“Port Talbot’s current heavy assets are nearing the end of their useful lives, are operationally unstable and are resulting in unsustainable financial losses.
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“The coke ovens, a critical facility for primary steelmaking, had to be shut down in March 2024 as operations became unfeasible and unsafe.
“Therefore, the company is forced to continue with its plans to decommission blast furnace No. 5 at the end of June and subsequently decommission blast furnace No. 4 by the end of September.
“The downstream assets will continue to serve customers using imported steel blanks until the new EAF is built and commissioned.”
Tata Steel added that it completed an “exhaustive” seven-month process of consulting all options with unions in April.
The conclusion was that blast furnace #4 continuity during the transition is “not technically, operationally, or financially viable”, jeopardizing the construction of the EAF and delaying the transition by at least two years.
Tata Steel also said that to mitigate the impact of the announced restructuring, a “generous voluntary redundancy program” has been developed and is being offered to affected employees.
The proposed grant funding from the UK government is earmarked to build the new EAF, which is “critical to securing long-term steel supplies for Tata Steel’s UK downstream assets and safeguarding 5,000 jobs across Tata Steel UK’s various plants,” the company said.
It also said it was unrelated to the “ongoing financial losses and instability of the existing heavy assets, the closure of which is now ongoing and unalterable”.
Tata Steel added: “We are therefore concerned by UK media reports since yesterday, as further political uncertainty over the timing and form of the grant will put the EAF project and the long-term future of Port Talbot steelmaking at significant risk.”
From CityAM
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