Fury over the closure of Teesside's last steel factory

Trade unions launch strike ballots as plant shuts and 1,600 workers lose their jobs

More than 150 years of steel making on Teesside ended in rancourous dispute yesterday, amid threats of strike action from steelworkers' trade unions and claims that proposals from potential white knights are being ignored.

The mothballing of the Teesside Cast Products factory in Redcar began yesterday, leaving 1,600 people out of work immediately and threatening another 8,000 local jobs.

Corus only announced on Tuesday that the facility was out of iron ore and would shut this week, but the Indian-owned company had confirmed in early December that the plant would close.

The crisis began in April, when the four-strong international consortium contracted to buy the majority of TCP's output walked out on a 10-year deal barely halfway through. Corus – which has spent £150m keeping the factory open since – says that the failure of its exhaustive attempts to find a buyer for either the plant itself or the unfinished "slab" steel it produces left no option except closure.

But trade unions representing Corus workers claim that there are at least two "credible" offers still on the table, which are being ignored.

And the high-profile involvement of the Government, following the announcement of the closure this week, has fuelled speculation that there are other options for the Redcar plant. "We are still trying to find new owners for the site," the Prime Minister, Gordon Brown, said. "A lot of work is being done behind the scenes."

Lord Mandelson, the Business Secretary, has also been similarly vocal on the issue, visiting the plant this week and announcing a £3.8m aid package for Corus apprentices and local Tees Valley businesses. "I know there are others out there with an interest in engaging with Corus to see how the plant may be put on to a more viable footing and its order books refilled," he said yesterday.

But some insiders accuse the Government of manipulating a regrettable situation for political ends. "This is just politicking," one industry source said. "The news of the consortium reneging on the TCP contract came out last May, so how come these so-called credible offers are suddenly coming out of the woodwork this week, within days of mothballing?"

Corus faces significant industrial unrest over TCP. Community, the trade union which represents around half of the company's British workforce, is to hold a series of votes across different Corus sites, with a view to "surgical strikes" to protest against the closure. "We believe there are at least two good-faith parties out there that are looking seriously at the plant and we are calling on Corus to examine these options further," a spokesman for the union said. "But we are confident that our members recognise that Corus has not exploited all the options and we will get a favourable response."

Community is also appealing to Ratan Tata, the president of Tata Group, the vast conglomerate which owns Tata Steel, Corus's parent company. "Ratan Tata is a good and decent person who wouldn't allow this to happen and we are asking him to intercede to prevent this devastation to the Teesside community," the Community spokesman said.

GMB, the other main trade union for Corus workers, is similarly incensed and the executive has given the authority for a national strike ballot. Keith Hazlewood, the national officer, said Corus has gone back on a promise to keep the factory open at least until the end of the month. "The decision to mothball the plant suggests that Corus did not really want to keep it open or sell it to another steel company," he said. "The decision is bad for Britain and for our manufacturing industry and our members will now be asked to respond."

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