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UK minister reveals ‘job guarantees’ will be part of Port Talbot negotiations with Tata

07 Jul 2024 4 minute read
Tata Steel’s Port Talbot steelworks. Photo Ben Birchall/PA Wire

The UK Government will press for “job guarantees” in return for taxpayer-funded investment during talks with steel giant Tata over the future of Port Talbot.

Business Secretary Jonathan Reynolds said he believes there is a “better deal available” for the site and the steel industry as a whole, as he confirmed negotiations with Tata were continuing on Sunday.

Tata has shut down one of two blast furnaces at its biggest plant under its plans to switch to a greener form of production.

The second blast furnace at Port Talbot is due to be shut down in September.

Unions are opposed to the changes, which will lead to the loss of around 2,800 jobs, although Tata has argued its restructuring programme is designed to stem “unsustainable” losses of more than £1 million a day.

‘Major priority’

Mr Reynolds described the situation at Tata as a “major priority” and insisted the approach is “not about underwriting loss-making businesses” but being a “partner for investment in the future”.

He told BBC’s Sunday With Laura Kuenssberg: “There is more money available for the steel industry under our plans for government.

“But that’s about making sure we meet this transition with the private sector together and recognise … it is a good exemplar of how we have to make sure that decarbonisation is not deindustrialisation and we’ve got to do that together.

“But there is a better deal available for Port Talbot and the steel industry as a whole, I’m sure of that.”

Mr Reynolds added: “I do want things in exchange for money we’ll co-invest with the private sector around jobs and technology.

“I think that’s a reasonable way to make sure public money is being well spent and I believe there are things, capacities, the steel industry needs in future that could be part of that conversation and that’s what I’ll be having in the next few days.”

He added: “I’m going to make sure that job guarantees are part of the negotiation that we’re having.”

Aims

Mr Reynolds said he would not put a particular figure on the Government’s aims, saying: “Blast furnaces employ more people than some of the newer technologies available, whether that is electric arc furnaces or what is called DRI, so there’s a range of things you have to understand.

“But I absolutely agree with the point that we have to make sure this is a transition that works for working people and that they’re part of that and you can’t simply give money out without guarantees in exchange for that.

“But there is a negotiation and I’m going to have to keep a little bit of that information to myself while I engage with the company.”

Unite general secretary Sharon Graham told the same programme: “There’s no doubt that Labour coming in and the intent of what they want to do is a good thing.”

She added: “My main focus is jobs, pay and conditions for workers so I’m going to either be seen as a critical friend or a pain in the proverbial, whichever they want to take that, because it’s my job to make sure feet to the fire on this.”

Ms Graham said the “devil will be in the detail” when it comes to a jobs guarantee on investment.

£2.5 billion

The Labour manifesto has committed to provide £2.5 billion to “rebuild our steel industry”, with Mr Reynolds noting this was “on top of” the £500 million committed by the previous government.

Tata has said it would make every effort to mitigate the impact of the transformation on affected employees and the local community.

It said it had put forward the most favourable financial package of support it had ever offered, including facilities for training and upskilling, alongside finance for small and medium-sized businesses through the UK Steel Enterprise regeneration and job creation scheme.


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Howie
Howie
7 days ago

Reynolds gave the impression that it won’t be all steel jobs that is saved. He would not commit to that when pressed. The Unite leader showed that she does not understand different types or grades of steel in her ‘all infrastructure projects should be british steel’ there are lots of different projects in UK that won’t be able to use steel from current UK steel sources. The much discussed ferries for CalMac had wrong grades and types installed which if it had not been picked up and rectified could have had catastrophic consequences. The new recent ships being built in… Read more »

John Powers
John Powers
7 days ago
Reply to  Howie

Is there any reason why all grades of steel can’t be produced domestically? Apart from the free trade deals allowing global suppliers to undercut domestic producers making them unviable, of course.

Howie
Howie
7 days ago
Reply to  John Powers

It is the type of steel making process and materials added to process that helps to define the steel you make. For example in Sheffield long known for it’s stainless steel, products are used in numerous industries e.g marine as well as domestic items amongst it’s uses. In Wales we had in past a number of Steelworks that produced steels for specific purpose, tinplate at Trostre, electrical steel at Orb in Newport, Llanwern which closed its heavy end now is mainly cold rolling, galvanizing and automotive finishing, the hot mill is still mothballed as far as I am aware, to… Read more »

John Powers
John Powers
6 days ago
Reply to  Howie

One way to make this happen is to copy the EU’s carbon border tax. No amount of investment on its own can grow this industry for the long term if it’s going to be constantly undermined by unfair competition from other parts of the world.

Howie
Howie
6 days ago
Reply to  John Powers

The EU recently raised tariffs on EV’s from China, MG and Tesla among them, some commentators think this will increase overall EV prices.
It will for us depend how Labour will view China exports to UK on a range of products. Most see it has continuity for now of Tory policy.

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