There will be a total of 2,800 job losses in Port Talbot in Wales and up to 3,000 job losses at British Steel in Scunthorpe. The Grangemouth oil refinery in Scotland will lay off an additional 400 workers.
Sources claim that unions’ expectations that funding from a new Labour government would help prevent job losses have been mostly disappointed.
“The solution isn’t writing a blank cheque to bail out the past, or to put taxpayers on the hook for the industrial challenges we’ve inherited,” the administration stated, adding that it was faced with “tough decisions.”
A £2.5 billion fund was pledged in Labour’s plan to revive the UK steel sector.
However, the new government is following in the footsteps of its predecessor by stating that public funds can only be used to finance the construction of new, environmentally friendly steel manufacturing facilities, not to cover significant ongoing losses at carbon-intensive operations.
The owners of Port Talbot, Tata, an Indian company, and Scunthorpe, Jingye, a Chinese company, both maintain that the plants are losing £1 million every day.
The last blast furnace at Port Talbot will eventually need to be replaced, and the government is in negotiations to finalize a subsidy to Tata of £500 million toward the £1.25 billion cost of creating an electric arc furnace.
