Government braced for “difficult” talks with Tata Steel | EUROtoday

Get real time updates directly on you device, subscribe now.

By Huw Thomas, Business Correspondent, BBC Wales

PA Media Jonathan Reynolds and Welsh first minister Vaughan Gething outisde Tata SteelPA Media

Jonathan Reynolds, who visited Port Talbot with First Minister Vaughan Gething in the course of the election marketing campaign, mentioned a “better deal” was accessible

New negotiations with Tata Steel over its restructure will likely be “difficult”, the enterprise secretary has mentioned.

But Jonathan Reynolds mentioned the UK authorities has “got to try” to alter plans which can value 2,800 jobs.

The firm will shut the second of its Port Talbot blast furnaces in September, citing losses of £1m a day.

Mr Reynolds is assembly unions on Wednesday to debate efforts to succeed in a “better deal” with the corporate.

The earlier authorities had pledged £500m to Tata Steel in the direction of to the price of a brand new £1.25bn electrical arc furnace which can soften scrap metal, however which requires far fewer staff than the normal blast furnaces.

The firm closed the primary of two blast furnaces on 5 July, and plans to close the second in September. Construction of the brand new furnace is scheduled to start in August 2025.

“There is a lot more that this deal could do,” Mr Reynolds advised BBC Radio Wales Breakfast.

“I know it’s going to be difficult, but I think I’ve got to try.”

Construction Photography/Avalon A steelworker testing molten iron quality at Blast Furnace 4 in Port TalbotConstruction Photography/Avalon

The first of Port Talbot’s two blast furnaces closed on 4 July 2024

Delaying the proposed closure date of the second blast furnace was one thing he had already raised with Tata Steel, Mr Reynolds mentioned, however he accepted that Tata’s place had been “very unmovable” on that.

He mentioned the talks had been about “more than just the future of that last remaining blast furnace” in Port Talbot.

“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,” he mentioned.

Mr Reynolds added that the federal government is implementing insurance policies which can enable larger public funding within the metal trade and can enhance the buying and selling atmosphere for companies.

“That’s everything from how our trade system works, to the energy prices big industrial producers pay,” he mentioned.

Tata Steel had mentioned it will press forward with its unique restructuring plans, no matter who received the final election.

It has reiterated that place since Labour got here to energy, with its UK chief govt Rajesh Nair saying he would “be engaging with new ministers” over its “ambitious plans to invest in and transform Port Talbot” and with “supporting our workers through this necessary but difficult transition”.

PA Media Tata Steel worker uniformPA Media

Industrial motion has been paused whereas unions return to negotiations with Tata Steel

Community, the most important union representing steelworkers, has warned that the brand new authorities was “up against it” and had 4 to 6 weeks to alter Tata’s plans.

Another union, Unite, referred to as off strike motion to return to discussions over the restructure. Redundancy packages have principally been agreed, and people talks will now give attention to future funding plans by Tata Steel.

Proposals about future funding embody discussions a few metal plate mill being inbuilt Port Talbot, which might provide the supplies to construct wind generators.

The Labour authorities had campaigned on the promise of a £2.5bn fund for the way forward for the metal trade, and has dedicated to persevering with the earlier authorities’s plans to offer £500m in the direction of the price of the brand new electrical furnace in Port Talbot.

https://www.bbc.com/news/articles/cxx2jzz175go