Tatas join UK steel industry to petition govt for action

The British government has been warned that it needs to take urgent action within weeks on issues flagged by the industry to prevent an escalation of the crisis and further job losses.

Industry representatives, including Tata Steel’s head of human resources for Europe Tor Farquhar, Community union head Roy Rickhuss, head of industry body UK Steel Gareth Stace, and minister responsible for the sector Anna Soubry were among those who appeared before a parliamentary select committee late on Tuesday afternoon, during which companies, unions and MPs presented a grim picture of the industry, which has shed thousands of jobs this year alone.

“We need action in weeks not months, if it’s months there will be further casualties in the sector,” warned Stace, whose industry body has outlined five major issues that the government needs to act on urgently.

The most important is the issue of dumping of steel by non-EU countries, notably China, which industry says the British government needs to pursue more rigorously via the European Union.

However, Britain has also been slow to push for European approval for a compensation package for energy intensive users (including the steel industry) for the significantly higher costs they bear compared to European competitors, as a result of UK clean energy policies, Stace said.

According to UK Steel estimates, energy costs for UK steel producers are roughly double those in France and Germany. Other issues include high taxes for non-residential properties (“business rates”) and the inclusion of capital investment in that taxation, and the need to increase UK public sector procurement of British made steel.

They welcomed the fact that the fifth action point — getting more time for the industry to meet air pollution targets set to come in by 2019 — had already been acted upon by the government.

Tata Steel’s Farquhar also urged speedy action.

“The pressure on prices is extreme,” he said, adding that the, “transformation of China from importing 100 million tonnes of steel to an exporter of some 340 million tonnes — the same size as the whole of the UK and US industry — had had a dramatic pressure on prices and massive pressure on all steel companies, particularly in Europe. I can’t emphasise how much we need action and quickly.”

When asked whether the company expected further losses, Farquhar said that there could be no guarantees. “Nothing can be ruled out. We are under enormous pressure.”

He emphasised that dealing with unfair trade practices was the most urgent issue. “The US has very effective barriers to trade. The EU has to be seen to be acting quickly.”

The House of Commons Business Innovation and Skills Committee hearing came a day before Business Secretary Sajid Javid headed to Brussels to discuss the crisis facing the UK and European steel industries.

Industry is hopeful that in addition to action on dumping it will enable the government to speedily introduce the long-awaited compensation package for the energy-intensive industry.

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