Tata Steel points finger at energy taxes as it cuts 720 jobs

Tata Steel blamed green taxes and cheap imports as it announced 720 job cuts at its speciality steel business in the UK.

Most of the cuts are set to fall on its plants at Rotherham and Stocksbridge in South Yorkshire, with around 170 jobs at risk at Wednesbury in the West Midlands.

The steel maker said the business – which supplies sectors such as aerospace and construction – had been hit by the UK’s “cripplingly high electricity costs”, which are up to more than double those of its European rivals.

Government promises to reduce the impact of high energy taxes a few years have not come to fruition, it added. The strong pound has also hit the business.

Karl Koehler, the head of Tata Steel’s European operations, said: “I realise how distressing this news will be for all those affected, but I am also extremely aware of our responsibility towards the ongoing survival of this business, which will continue to employ about 1,500 people in South Yorkshire.”

Unions echoed Tata’s call for government action. Doug Patterson at Unite said: “It is clear that we need more of an energy level playing field to help the steel industry in particular and manufacturing in general.”

The UK steel industry’s struggles with high energy costs are also believed to be a key reason why Tata’s deal to sell its long products division – which employs 6,500 staff, including 4,000 in Scunthorpe – to the Swiss-based Klesch group has not yet been sealed. The deal was first announced last October and Tata wrote off the value of the business in its accounts in May.