Hundreds of millions of pounds extra investment needed in Tata steel – minister
The Indian conglomerate last week confirmed plans to close the blast furnaces at Port Talbot, with the loss of up to 2,800 jobs.
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Your support makes all the difference.Hundreds of millions of pounds of additional Government investment is needed to secure the future of Wales’s steel industry, a Welsh minister has suggested.
Welsh Government economy minister Vaughan Gething said the UK Government’s £500 million package to help Tata transition to produce more environmentally-friendly steel was not enough to save thousands of jobs.
Last week the Indian conglomerate confirmed plans to close the blast furnaces at Port Talbot – its biggest UK plant – with the loss of up to 2,800 jobs in South Wales.
Mr Gething told a press conference that the Welsh Government could not afford to invest the sums of money required to help Tata transition.
“It would require hundreds of millions of pounds of additional investment. I am really clear about this,” he said.
Even now there could be hope. The Prime Minister could realise the scale of the anger, upset and hurt that the UK Government and Tata plan provides
“It’s not a marginal investment of one or two million – it’s hundreds of millions.
“I think this comes down to whether the UK Government is prepared to contribute to a future of the UK steel sector.
“Before people start saying the Welsh Government should put even more into the pot, you all know what our draft budget looks like.
“Everyone knows that the economic and fiscal firepower to put into a genuine deal with a future of steel, the best deal, requires a UK Government of any type, of any colour, to invest in the future.
“The Conservatives themselves have recognised this because they made clear we don’t have the budget to put in the sort of sums of money the company were looking for in investment.
“That was part of their rationale for excluding us.”
About 2,500 jobs could be lost in the next 18 months at Port Talbot while a further 300 roles could be affected in Llanwern, near Newport.
Mr Gething told a press conference the shedding of about 2,500 jobs was “genuinely avoidable” if the UK Government would “engage” with the Welsh Government.
Last week, Prime Minister Rishi Sunak was “not available” to speak with First Minister Mark Drakeford and Mr Gething said the Cardiff administration had been “locked out of the room” during negotiations with Tata.
“Even now there could be hope,” Mr Gething said.
“The Prime Minister could realise the scale of the anger, upset and hurt that the UK Government and Tata plan provides.
“It could instead pull up the stops in the coming hours and days to reverse the worst of these proposed cuts.
“All of us should be committed to the best deal for steel, not the cheapest deal.”
He added: “The transition that needs to take place is one that the current UK Government is not prepared to invest in to maintain that further steelmaking capacity.
“It comes down to a choice.
“Do you think hundreds of millions of pounds of investment is worth it to avoid thousands of job losses?
“Do you think it’s worth doing that not just to protect those jobs for a period of years into the future, but to invest into your transition to lower carbon steel? I think that is a smart bet on our future.”
Mr Gething said he believed there was still a need for the UK to be able to produce virgin steel for its own construction and manufacturing industries.
“Other places will benefit from British demand while Wales pays the price,” he said.
“Worst still, that steel will be loaded onto diesel fuel vessels and shipped thousands of miles across oceans, adding costs and pollution.
“There is a better way. The UK Government and Tata have the tools to secure a longer, fairer transition for a sector that is good for growth and essential our collective security.”
Tata said continued blast furnace production in Port Talbot was “not feasible or affordable” and a deal with the UK Government would help transition a more sustainable, greener steel production using electric arc furnaces.
The UK Government has committed to invest up to £500 million while Tata will spend £750 million.
Tata said more than £130 million will be spent on measures including redundancy terms, skills retraining and help with jobseeking.