DTI steps in to save 2,000 jobs with £50m aid for Runcorn chlorine plant

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More than 2,000 chemical workers' jobs were saved yesterday after the Government announced an aid package for a factory that was under threat of closure.

The Department of Trade and Industry said it had awarded £50m worth of regional aid to Ineos Chlor, a Chlorine manufacturer, to help modernise its plant in Runcorn, Cheshire. The package comes a day after the Ministry of Defence saved hundreds of jobs by awarding the contract for jet trainers to BAE Systems over cheaper bids from foreign rivals.

Ineos Chlor, a privately owned company that bought the site from chemicals giant ICI, had warned that more than 13,000 jobs would be lost if it shut the factory. The DTI grant is part of a £389m investment programme by the company that will safeguard the jobs of the 2,100 workers at the plant.

The company said a further 8,000 jobs across the North of England, Scotland and Wales would be protected in associated businesses dependent on the Runcorn site. The plant produces four-fifths of the UK's supply of chlorine, a chemical that cannot be imported in bulk.

Patricia Hewitt, the trade and industry secretary, said: "This is great news for the UK chemicals sector and the regions, which will benefit from today's decision."

She indicated that she took wider political goals into account when making the decision, saying it would secure "well-paid jobs in areas where the unemployment rate is much higher than the UK average." She added: "A strong UK chemicals industry is a crucial part of our manufacturing base and of the UK economy."

Ineos Chlor said the investment would "help to underpin the competitive cost base of the site and secure its long-term future". The GMB union, which represents 500 workers at the plant, welcomed the news.