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A PROPOSED rescue package for sections of Tata Steel will achieve nothing unless the government addresses the causes of the industry-wide crisis, unions warned yesterday.
Tata, which recently laid off over 1,000 workers, looks set to sell its long products division, signing a “letter of intent” with investment firm Greybull Capital yesterday.
The proposed deal covers Tata’s Scunthorpe works alongside mills in Teesside, Scotland and northern France, an engineering workshop in Workington and a design consultancy in York.
General union GMB said the news was a “welcome development” for steelworkers.
“The next step is the due diligence process and we expect local GMB representatives to be fully involved,” national officer David Hulse said.
“This is an exceptionally challenging time for the UK steel industry. It is essential that the UK government plays a full part in securing a level playing field to enable this essential industry to survive and thrive.”
MPs issued a stern report on Monday, arguing that the government had failed to heed warnings about the steel industry before it plunged into crisis this autumn costing thousands of people their livelihoods.
Steel union Unite said a Tata sale would provide some comfort to 5,000 workers whose livelihoods are still at risk.
But Unite metals chief Harish Patel said a promise for unions to meet with potential buyers ahead of a sale had not been heeded.
“Ministers need to realise that the matter does not end here — the industry is still in crisis, and yesterday’s scathing report said that government needs to be more engaged in the protection and development of this vital UK industry,” he said.
Greybull, which bought a majority stake in low-cost airline Monarch last year, said that “much work remains to be done” before a deal could be reached.
Labour shadow business secretary Angela Eagle said: “As negotiations begin it’s important that both sides continue to work closely with trade unions, works councils and with employees to ensure that any potential deal is based on a long-term and sustainable vision for the business.”
