Steel meltdown

As a critical modern industry faces meltdown caused by artificially cheap Chinese steel flooding the UK and European markets, Cameron, Osborne and Javid are caught frozen in the headlights.

Because one in six steel jobs – over 5,000 – have gone in the space of two weeks and the entire industry which employs 30,000 could be gone inside 12 months. Another 60,000 jobs linked to the industry and the communities with steel plants could also be lost.

Fears are growing in the aftermath of Tata Steel announcing 1,200 job losses in three plants at Scunthorpe, Motherwell and Cambuslang. When the Scottish plants close, no large scale metal furnaces will operate in Scotland for the first time since the start of the industrial revolution.

It comes on the back of the collapse of Caparo which employs 1,700 people in 20 locations in the West Midlands. SSI in Redcar, Teesside, closed down last week with the loss of 3,000 jobs as the industry went into meltdown.

The impact will be immediate with the loss of key skills and capabilities. The steel used to build the Trident fleet of nuclear submarines gleefully announced by David Cameron at Tory Party conference will now have to be foreign steel.

Specialised military grade steel will also have to be foreign supplied. As will some of the ultra-high grade steel used in nuclear power plants.

Steel rails used on high speed routes such as HS2 which is awaiting the green light will also have to be foreign steel. Steel rails used in upgrading other rail routes to higher speeds will also have to be foreign supplied if the closures go ahead.

It will also hit oil and gas industry offshore drilling platforms – the plants facing closure in Scotland will cost the industry specialist skills and UK made material. And the high grade steel used in the oil and gas industry’s pipelines will have to be foreign supplied in the future if the closures announced today go ahead.

Accusing the UK government of failing to heed the warning signs and washing its hands of the steel industry, Unite said it would be working around the clock to find alternatives to save jobs and save steel making in the UK.

Support plea

Unite is calling on the government to support the steel industry by taking urgent action to stop the ‘dumping’ of artificially cheap Chinese steel, help with high energy costs and business rates and ensure that major infrastructure projects use British steel.

General secretary Len McCluskey said, “If ministers want to avoid their much-vaunted ‘Northern Powerhouse’ becoming nothing more than meaningless spin, they need to act urgently to save our Steel.

“Failing to act will leave communities who rely on steelmaking high and dry – with incalculable consequences through supply chains and the industries reliant on steel.”

Unite assistant general secretary Tony Burke said, “This is a dark day for the UK steel industry, for the workers and the communities who livelihoods depend on steel. We will be working closely with Tata to find alternatives and to save as many jobs as possible.

“The knock on effects of today’s (October 20) news combined with Caparo and the closure of Redcar through the supply chain will be devastating. Trade unions, the industry and business groups are all united on the need for the UK government to support the steel industry.”

He added that Tory business secretary Sajid Javid, who has failed to wake up to the depth of the problem, “is becoming increasingly isolated by his failure to act swiftly to support the steel industry. He and the UK government know what needs to be done and they need to do it quickly. A failure to act and tackle the dumping of cheap Chinese steel will spell the end of steel in the UK.”

Proud tradition ends

And Unite Scottish secretary Pat Rafferty said, “Today’s news effectively brings an end to a proud tradition of steel making in Scotland. The impact on the Scottish economy which is also being hammered by job losses in North Sea oil will be severe unless there is urgent support.

“We will be pressing the Scottish government to live up to its promise to do everything it can to support the steel industry in Scotland and save jobs. The UK government should take note of the Scottish Government’s more proactive response and act to save our steel across the UK.”

Speaking after the announcement of the Redcar closure Unite convenor Kevin Cook told UNITElive, “It’s a nightmare, the workers and the area do not really know the scale of what has hit them.

“We’ve had cut backs before and we’ve seen the local town decimated with the bigger shops closing, pubs closing and the pound shops coming in. This closure is on a different scale and this area will not recover, it is devastating.

“I’m 55 and have never been out of work since I was a 16 year old. There are people here with young families with mortgages who thought they had a decent job and now it’s gone.

“There are whole families employed at the plant. They will have lost everything.

“The government says it has put some money up – around ÂŁ80 million – but that is to pay for the aftermath of closure. We think some of that will go on redundancy payments and maybe a bit of training so we’ll see how much of that is actually spent.

“But little has been done by the government to save the plant itself. And then we here that the UK taxpayer has given a low interest £45 million loan to a company run by Chelsea owner Roman Abramovic so he can refurbish a steel works in Canada.

Kicked in the teeth

“Hearing that news was a real kick in the teeth. Talk of a Northern Powerhouse appears to be that – talk, there is nothing to back it up.

“What is happening at Redcar can sweep across the UK steel industry. We could arrive in a few years – maybe sooner – and find there is no UK steel industry.

“The government needs to decide whether they want a UK manufacturing base or not. If they do, then they need the core industries like steel and others to underpin it.

And speaking to UNITElive last night (October 19) ahead of the job losses details, Unite’s Charlotte Upton a 25 year-old electrician at the Tata Scunthorpe plant told us, “I don’t think the government has done all it could. It seems to think the market rules and it does not want to intervene.

“The Chinese are dumping cheap steel they can’t use at home. They’ve cut the value of their currency to make it even cheaper.

“Osborne was in China asking them to bid for the HS2 high speed rail contract. You’d think as a country – as others do – that we’d insist we made the steel for the project in our own steel industry.

“Scunthorpe has the rail making capacity and the highest quality railway steel in the world. Why not insist we use this steel for our rail industry because that’s what other countries do.

“That’s part of a manufacturing and procurement strategy. Why would you not use our steel on our projects? British steel used on British contracts rather than allowing others to dump artificially priced cheap steel on us.

“What’s happening now is so short-sighted. This is a growing modern industry and the government is sitting back and watching it be destroyed.

Devastating

“The social impact would be devastating. Scunthorpe, Redcar and other places could just disappear, and all of that avoidable.”

But it’s not just the unions saying this. Gareth Stace, director of UK Steel, said, “If we are to stem this tide then the business secretary must now deliver as a matter of urgency the commitments he made at last week’s summit, on energy costs, business rates costs and tackling unfair trade.

“In addition, we must also see a commitment from all parts of government at the highest level to ensure the sector’s survival in the UK.

“The prime minister can demonstrate that he is prepared to lead this commitment by stepping in this week and pressing the Chinese Premier about the dumping of under-priced steel which is one of the major factors killing our industry.”