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Britain will be forced to rely on steel from India and China after Tata closures in Port Talbot

Almost 3,000 job losses come despite Tata being promised up to £500m by the government to limit redundancies

Archie Mitchell,Alex Ross
Friday 19 January 2024 11:19 GMT
MP's anger at Tata Steel Port Talbot closure

The closure of two blast furnaces at Britain’s biggest steelworks will lead to thousands of job losses and leave the UK reliant on foreign steel imports for years to come.

In a fresh blow to Rishi Sunak, Tata Steel said it was cutting 2,800 jobs at its plant in Port Talbot in south Wales as it confirmed the closing of both blast furnaces at the site.

Amid outrage at the scale of the job losses, the Indian-owned steel giant said it was “not feasible or affordable” to adopt a plan put forward by the GMB and Community unions to keep the furnaces open.

It means that 2,500 workers will lose their jobs in the next 18 months, with another 300 to come. As well as having a devastating impact on the local community, the closures will leave Britain reliant on foreign steel imports, including from India and China.

Labour said foreign powers “won’t always have Britain’s best interests at heart”, as the party condemned Rishi Sunak for failing to take up a “better” union-led plan to transition to greener production.

A replacement so-called electric arc furnace, a greener way of making steel, will not come online until 2027 at the earliest. In the meantime, Britain will be forced to plug the gaps left by the Port Talbot closures with imports from abroad, which critics say will lead to higher emissions until the replacement comes online.

Experts said the UK’s domestic emissions would be as much as 3 per cent lower because of the closures, but that this would be offset and could even be surpassed by an increase in Britain’s global carbon footprint once imports are accounted for.

A steelworker wears a badge on his jacket outside the UK’s largest steelworks in Port Talbot

Roz Bulleid, research director at the Green Alliance think tank, told The Independent: “Exactly what happens to the UK’s wider carbon footprint during the transition depends on where we get the steel from to replace British production.

“Europe has a mixture of blast furnaces and lower-carbon production, while Asia has more blast-furnace production. But over time, we will see European emissions fall. This is a race to low-carbon steelmaking that the UK risks missing out on.”

And, in a damning indictment of UK industry, the closures will also mean that Britain is the only G20 country that can’t make virgin primary steel. Virgin steel is used in everyday products such as tin cans. These will now have to be produced abroad, and it is unlikely that they will be manufactured in the UK again in future.

The closures and job cuts come despite Tata being promised up to £500m by the UK government in a bid to keep the plant open and produce steel using more environmentally friendly methods.

The Port Talbot plant is the largest steelworks in the UK and currently employs 4,000 of the company’s 8,000-strong UK workforce. The move means almost 75 per cent of workers will lose their jobs. The GMB union said the job losses are a “crushing blow to Port Talbot and UK manufacturing in general”.

Charlotte Brumpton-Childs, national officer for steel, said: “It doesn’t have to be that way – unions provided a realistic, costed alternative that would rule out all compulsory redundancies.” But she said the plan has “fallen on deaf ears” and that steelworkers and their families will now suffer.

Andrew Gutteridge, chair of the Multi Unions Llanwern works, said it would cause “absolute ruin” in the community, with unions estimating that each job at the steelworks creates another three in the wider economy.

“Your local newsagents, your chip shops, your supermarkets – everything in this area will be affected,” he said. “This is a massive, massive kick for the whole of south Wales, really.”

Tata Steel said it was ‘not feasible or affordable’ to adopt a union plan to keep the furnaces open

Sir Keir said he was “very concerned” by the job losses at Tata Steel – urging Mr Sunak to listen to the “better plan” offered by unions to prevent so many redundancies.

“The government said it had a plan for steel. It transpires the plan involves thousands of redundancies. There’s a better plan – a multi-union plan – that the government needs to look at again,” the Labour leader told broadcasters.

Asked if he agreed that the government’s £500m investment had helped limit redundancies, Sir Keir said: “I’m not against the government investment ... but their plan involves all of these redundancies when there’s a different and better plan on the table.”

Under the so-called multi-union plan put forward by the GMB and Community unions, it was hoped that Tata Steel could transition Port Talbot towards greener steelmaking over a longer timeline.

Had it been adopted, there would have been no compulsory redundancies, and Britain’s domestic steel supply would have been protected.

In a joint statement, GMB and Community said they were “extremely disappointed” that Tata had rejected the alternative plans they presented. The unions met Tata representatives on Thursday in a last-ditch attempt to push the multi-union plan.

Rishi Sunak insisted the government is ‘absolutely committed’ to British steelmaking

The two unions lashed out at Unite, which also represents workers at the plant, for “undermining” the plan and for “unilaterally campaigning for discredited fantasy solutions”.

And they took aim at Tata and the UK government, saying it was a “disgrace” that they appeared to be “intent on pursuing the cheapest instead of the best plan for our industry, our steelworkers and our country”.

Mr Sunak said the government is “absolutely committed” to British steelmaking, adding: “I know first of all that it will be a worrying time for everyone affected.”

He said the alternative was the entire plant being closed, leading to 8,000 job losses overall. “But the government worked with the company,” he said.

Welsh first minister Mark Drakeford’s office condemned Mr Sunak after No 10 said he was “not available” for urgent talks requested about the potential loss of thousands of jobs.

Labour’s shadow business secretary Jonathan Reynolds has previously attacked the government over the funding package, saying: “Only the Tories could spend £500m of taxpayers’ money to make thousands of British workers redundant.”

Stephen Kinnock said the job cuts will be ‘utterly devastating’ to the community in Aberavon

Stephen Kinnock, the Labour MP for Aberavon, home of the Port Talbot steelworks, said the losses will be “utterly devastating” as he described the situation as “deeply frustrating and unnecessary”.

He said: “Global demand for steel is actually growing, but by pursuing a narrow electric-arc-furnace-only model, Tata Steel will be unable to seize the commercial opportunities of the future, while at the same time leaving Britain more dependent on imported steel from countries whose governments won’t always have Britain’s best interests at heart.”

Tata chief executive TV Narendran said the decision was “difficult” but “we believe it is the right one”.

“We recognise this proposed restructuring would have a major impact on the individuals and communities concerned, whom we will support with dignity and respect,” he added.

Mr Narendran told Times Radio that the steel giant had been “struggling to survive for the last 15 years”, adding: “Obviously all that we did was not enough.”

He claimed that the union plan would have cost £800m more – £600m to keep one blast furnace running, while £200m would have gone on the cost of building the electric arc furnace.

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