THE British Business Secretary Sajid Javid is heading to India to meet Tata chairman Cyrus Mistry in Mumbai to discuss its plans to get rid of Port Talbot steelworks and all of its other UK steel operations.
British Prime Minister David Cameron is now involved in the battle to save Tata Steel’s UK business, after little action since the Tata put the plants up for sale a week ago. This followed Mr Javid’s visit to Port Talbot to meet the workers whose jobs are threatened, as shown above.
The prime minister will meet the Welsh first minister Carwyn Jones to discuss how to get interested buyers in the sites including Port Talbot, in spite of EU rules on state aid hampering any obvious government help in this situation.
Mr Jones, who is a Labour politician, blasted the UK government’s response, saying it had been “slow and inadequate” and highlighted the UK’s opposition of higher EU taxes on Chinese steel, demanding that the UK should back higher tariffs instead.
Last week Tata Steel said it was conducting a strategic review for its UK operations, acquired for £6.2bn in 2007, but which have gone into the red following the global steel glut. Port Talbot in South Wales, which employs about 4,000 workers, is the most problematic site.
Mr Jones labelled Tata Steel’s decision “deeply disappointing”, and said the company should now allow “months, not weeks” for a buyer to come forward.
Trying to take control of the drama, Mr Cameron sent his policy chief Oliver Letwin to join Mr Javid at a meeting with Tata Steel’s finance director Koushik Chatterjee in London.
The prime minister’s office said that, under state aid rules, the UK could still “provide financial support” for the steelmaking sites. That could include reducing pensions and energy costs.
The government remains opposed to allowing higher tariffs on Chinese steel and the Prime Minister’s spokesperson said: “We don’t want to have decisions in one area which have an adverse impact in other areas.”
In response, Mr Jones said he had “a simple message for the people of Wales and the UK government: these plants cannot close.”
He told the Welsh Assembly: “We are not arguing to prop up a dying industry. We cannot contemplate a future without a domestic steel production capacity.”
The Welsh government has put together a package of support worth £60m. This is made up of a £30m commercial loan to convert one of Tata Steel’s lines to a galvanising line, a further £30m for environmental improvements, and up to £2m for skills and training. “That remains on the table,” Mr Jones said.
Mr Javid has been heavily criticised after going on a business trip to Australia, despite being aware that Tata Steel was close to making a decision on its UK business.
Allies of the business secretary insisted he remained “in the hot seat” and “in control” of the government’s response. He will meet Sanjeev Gupta, founder of the commodities firm Liberty House, who has expressed interest in some of Tata Steel’s UK sites.