Unite general secretary Sharon Graham has said that talks with the government aimed at saving jobs at Tata Steel have been ‘extremely positive’.
Business secretary Jonathan Reynolds has pledged that the UK government has “got to try” to change the steel giant’s plans, which will cost 2,800 jobs.
Tata will close the second of its Port Talbot blast furnaces in September, citing losses of £1m a day.
Reynolds discussed efforts with unions to reach an improved deal with the company on Wednesday.
The previous Conservative government pledged £500m to Tata Steel towards the cost of a new £1.25bn electric arc furnace which will melt scrap steel and is considered more sustainable, but which requires far fewer workers than traditional blast furnaces. Construction of the new furnace is scheduled to begin in August 2025.
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The company closed the first of two blast furnaces on 5 July, and plans to shut the second in September.
Reynolds told BBC Radio Wales Breakfast: “There is a lot more that this deal could do. I know it’s going to be difficult, but I think I’ve got to try.”
But Graham was more upbeat about prospects. She described the Labour government’s input as a “game changer”, and added: “Our meeting this morning with Jonathan Reynolds was extremely positive,” she said. “The commitment given to achieving a sustainable, profitable UK steel industry is very welcome and, as was said this morning, decarbonisation must not mean deindustrialisation.”
Reynolds said Tata had appeared determined to stick to September for closing the second blast furnace, but added the talks were about “more than just the future of that last remaining blast furnace”.
He said: “There are questions as to how quickly the transition happens, and the scale and size of the new furnaces that might be put in place.”
Tata UK chief executive Rajesh Nair said he would “be engaging with new ministers” over its “ambitious plans to invest in and transform Port Talbot” and “supporting our workers through this necessary but difficult transition”.
Reynolds added: “Steel is vital for a vibrant, secure economy and our steel sector needs a government working in partnership with trade unions and business to secure a green steel transition that’s right for the workforce whilst delivering economic growth.”
Community, the largest union representing steelworkers, has warned that the new government was “up against it” and had four to six weeks to change Tata’s plans.
General Secretary of Community Roy Rickhuss, said: “We welcome that the new Labour government has made securing the future of Port Talbot and the downstream sites a top priority, and welcome also the business secretary’s commitment to working with us to negotiate the best possible deal.
“There’s no doubt that time is running short, and we call on Tata to engage urgently in meaningful discussions with the government to unlock greater investment and protect jobs. The uncertainty must come to an end, and our members need and deserve to know what their future holds.”
The unions two weeks ago called off strike action to return to discussions over the restructure. Redundancy packages have mostly been agreed, and those talks will now focus on future investment plans by Tata.
Future investment may include a steel plate mill being built in Port Talbot, which could supply the materials to build wind turbines – a plan that may benefit from the new government’s £2.5bn fund for the future of the steel industry.
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