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The UK’s new Labour government will make “job guarantees” a requirement of any state support package offered to Tata Steel as the company restructures its operations, the business secretary has said.
Jonathan Reynolds said on Sunday that the issue of looming job losses at Tata was a “priority” and revealed that he and Prime Minister Sir Keir Starmer had already spoken to executives at Britain’s biggest steelmaker.
There is a “better deal available” on the future of Tata’s flagship plant at Port Talbot in south Wales, Reynolds said on BBC’s Sunday with Laura Kuenssberg.
Up to 2,800 jobs are at risk at Port Talbot as part of a plan to close its two blast furnaces and move to greener forms of steel making. One furnace already closed last week.
The previous Conservative government agreed a £500mn taxpayer support package for Tata, which would have invested £750mn to build one electric arc furnace. These are less carbon intensive but also employ fewer workers.
The plan, however, was not signed before the election and risks the loss of up to 2,800 jobs.
“I’m going to make sure that job guarantees are part of the negotiations that we’re having,” said Reynolds, adding that “we have to make sure this is a transition that works for working people”.
Reynolds declined to say how many more jobs Labour would be able to guarantee but noted that “blast furnaces employ more people than some of the newer technologies available”.
“There is more money available for the steel industry under our plans for government,” he said. “It is about making sure we meet this transition with the private sector.”
Labour has promised a £3bn “green steel” fund to better support the entire steel industry in its transition, which includes the £500mn support for Tata agreed by the previous government.
British Steel, which operates Britain’s other two remaining blast furnaces, has asked for a similar level of taxpayer support as Tata to help its move to greener production.
Tata responded to Labour’s victory on Friday by saying it would be “engaging with new ministers” about its plans.
The Indian-owned group has consistently rejected keeping the second blast furnace open for longer, arguing that doing so was neither feasible operationally nor affordable.
The company may promise to invest in new processing facilities as part of a deal with Labour.