More misery for steel industry with Tata set to announce job cuts

PUBLISHED: 09:23 20 October 2015 | UPDATED: 09:23 20 October 2015

Tata Steel Plant in Scunthorpe, which is expected to suffer another setback with the owners predicted to announce up to 1,200 job cuts at the Lincolnshire site and Scotland. Picture Anna Gowthorpe/PA Wire

Tata Steel Plant in Scunthorpe, which is expected to suffer another setback with the owners predicted to announce up to 1,200 job cuts at the Lincolnshire site and Scotland. Picture Anna Gowthorpe/PA Wire

PA Wire/Press Association Images

The steel industry is expected to suffer another blow today, with Tata predicted to announce up to 1,200 job cuts in Scunthorpe and Scotland.

The latest bad news follows the announcement that the Thai owners of the Redcar steelworks on Teesside, SSI, had gone into liquidation with the loss of 2,200 jobs, then Caparo went into administration yesterday.

Tata is expected to make an announcement on the future of its plants at Dalzell in Motherwell, Clydebridge in Cambuslang and Scunthorpe. Jobs affected are thought to include up to 400 in Scotland, where steelmaking will effectively end if cuts go ahead at the plants.

Although Tata is yet to confirm its plans, First Minister Nicola Sturgeon has already pledged to set up a task force to seek a viable future for the plants and the industry.

Unite has said 1,700 jobs are threatened at Caparo, owned by Labour peer Lord Paul, which has plants across the UK, but mainly in the West Midlands.

Matt Hammond, lead administrator at PwC, said: “This is a significant business with a wide range of interests across steel, engineering, vehicles products and technologies.

“Its scale and reach into significant customers and its importance to suppliers cannot be understated. We will be rapidly assessing all options for the businesses through this week and beyond.”

Tony Burke, assistant general secretary at Unite, said: “This is yet another hammer blow for steel and manufacturing communities across the UK already reeling from the closure of Redcar and job losses at Tata steel.

“Our members at Caparo Industries are highly skilled and work hard to produce world class products. We believe that the company has a future. Unite will be working with Caparo’s administrators and doing everything in our power to save jobs.”

Caparo Industries comprises around 20 individual businesses involved in steel and engineering, creating products for the aerospace, automotive and engineering industries.

Three subsidiaries are not in administration, two in the UK (Caparo Merchant Bar and Caparo India) and one in Poland (Bomet SA).

PwC said workers will be briefed on the impact of administration, stressing that staff are attending work as normal and will be paid, adding: “In these respects it is business as usual while the administrators’ review gets under way.”

The TUC has warned that one in six steelworkers now face the prospect of losing their jobs. Around 5,200 UK steelworkers face redundancy, it warned.

Prime Minister David Cameron has pledged to raise the issue of the “dumping” of cheap steel with the Chinese president as the crisis in the industry grows.

He told the Commons no subjects were off the table during the four-day visit by President Xi Jinping.

Roy Rickhuss, general secretary of steelworkers’ union Community, said: “We have had a succession of ministers, and now the Prime Minister, saying that they will ‘raise’ the issue of Chinese steel dumping, which we know is impacting on the UK steel industry and the global steel price.

“The Prime Minister needs to do more than ‘raise’ the issue. He needs to tell the Chinese premier what action he’s going to take to stop Chinese steel damaging the future of a vital foundation industry in the UK.”

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