‘Failed to get to grips with crisis’

Labour has proposed a ÂŁ35bn plan to save Port Talbot steel works and the rest of the British steel industry by bringing forward work on HS2 and 500 other rail, airport and road projects.

More than 40,000 jobs are under threat, 4,300 of them in Port Talbot, after India-based steel giant Tata announced that it will sell all of its UK businesses – because of high running costs and the swamping of the market by cut price Chinese imports.

John McDonnell, Labour’s shadow chancellor, has put forward a four point plan to use British steel on national infrastructure schemes after continued Tory inaction and ineptitude left the industry, and the communities that depend on it, standing on the edge of a cliff.

McDonnell said, “The Tories are in total disarray and have failed to get to grips with the steel crisis.

“Steelworkers and the industry can’t afford to wait for them to get their act together, so Labour is getting the ball rolling.

‘Shovel-ready’ projects 

“The government has £35bn of shovel-ready projects. This is not new money – just money standing still. Let’s get it moving.”

The shadow chancellor made clear that state ownership should not be excluded for the Port Talbot plant, or other UK steelworks. As well as fast-tracking key infrastructure projects, Labour demanded a level playing field for British steel by reducing the industry’s crippling business rates and energy prices.

Labour would also work with employees, management and customers to implement a strategy to stabilise and safeguard the industry’s long-term future and provide security for steelworkers.

McDonnell said, “This plan is a good starting place for a framework by which we can hopefully get cross-party agreement to find a solution to stabilise the industry and secure the workforce.”

The Liberty Group has expressed interest in buying the Port Talbot site, however owner Sanjeev Gupta said it was “complicated deal” and admitted that Port Talbot’s blast furnace operations, which make up the bulk of employment, would be difficult to turn around.

Gupta’s comments come after a week of speculation on the industry’s future, after business secretary Sajid Javid admitted being caught by surprise when Tata announced the closures last week. Since then he has failed to offer any viable solution to the crisis and has only just made plans to travel to India to consult with Tata’s bosses.

End of the industry?

Meanwhile Britain’s second largest steel manufacturer, Celsa UK, said that if the government fails to resolve the situation it could mean the end of the industry.

Celsa’s managing director, Luis Sanz, told the Guardian that “in other European countries they saw these problems coming and acted in advance.”

His sentiments were echoed by the unions who, after meeting yesterday to lay out a plan for the government to save the industry which included measures to keep Port Talbot’s blast furnaces open through investment in low carbon technologies, declared the Conservative’s response a “disaster”.

Unite assistant general secretary, Tony Burke, called on Prime Minister David Cameron to take over management of the crisis from Javid.

He said, “It is clear that last week the government’s eye wasn’t on the ball. It was a disaster. We have got to get the Prime Minister to intervene. There were more questions than answers last week. Now we are looking for answers to the questions.

“This government has had no industrial or manufacturing strategy from day one. They must now secure the plants, the jobs and steel’s future.”