Consultation over Tata Steel job losses begins

Around 2,500 roles will be impacted in the next 18 months.

It is not yet clear whether any of the redundancies will impact on Tata Steel's Steelpark at Wednesfield and its rail terminal operation at Round Oak, Brierley Hill. More than 500 are employed by Tata in the steel processing and distribution operation.

Tata Steel is moving from blast furnaces in South Wales to green steelmaking in the UK.

Port Talbot’s two high-emission blast furnaces and coke ovens would close in a phased manner with the first blast furnace closing around mid-2024 and the remaining heavy end assets would wind down during the second half of 2024. The proposal also includes a wider restructuring of other locations and functions across the company, including the intended closure of the Continuous Annealing Processing Line at Trostre plant, Llanelli in March 2025.

Its plan is intended to reverse more than a decade of losses and transition from the legacy blast furnaces to a more sustainable, green steel business.

The transformation would secure most of Tata Steel UK’s existing product capability and maintain the country’s self-sufficiency in steelmaking, while also reducing Tata Steel UK’s carbon dioxide emissions by five million tonnes per year and overall UK country emissions by about 1.5 per cent.

The plans follow detailed discussions with the UK multi-trade union representative body and its advisors, in which Tata Steel carefully considered their endorsed proposal for maintaining a single blast furnace.

Having considered that proposal, Tata Steel has agreed to adopt elements of it, but considers that continued blast furnace production is not feasible or affordable.

The company will endeavour to maximise voluntary redundancies and proposes to commit in excess of £130 million to a comprehensive support package for affected employees, including redundancy terms, community programmes, skills training and job-seeking initiatives

This is in addition to the £100 million funding for the Transition Board set up with UK and Welsh governments to support affected employees, contractors and communities.

In discussion with the UK Steel Committee, Tata Steel has agreed that it would continue to operate the hot strip mill through the proposed transition period and in future. In addition, the downstream and steel processing centres would continue to serve customers by utilising imported semi-finished steel from Tata Steel plants in the Netherlands and India as well as other select strategic suppliers.

Under the transformation plan, Tata Steel will embark on a £1.25 billion investment in electric arc furnace technology in Port Talbot and asset upgrades to secure long-term, high-quality production at the UK’s largest steelmaker.

The proposed investment is supported by the UK Government, which has committed up to £500 million to enable the transformation. Tata Steel plans to invest £750 million in the project, alongside funding for a comprehensive support package for affected employees, business restructuring and transition costs as part of its long-term commitment to UK production.

Under Tata Steel’s proposed restructuring programme, Port Talbot’s two high-emission blast furnaces and supporting facilities would be closed in a phased manner. The first blast furnace and coke ovens closing around mid-2024 and then progressively winding down the remaining heavy end assets during the second half of the calendar year.

The proposal also includes a wider restructuring of other locations and functions across the company.

300 roles could be impacted in three years time, which could include the potential consolidation and rationalisation of cold rolling assets in Llanwern once the required investments are completed at Port Talbot.

Throughout the proposed restructuring, Tata Steel remains committed to maximising voluntary redundancy before seeking any compulsory reductions.

Tata Steel will support all those potentially impacted through a comprehensive support package including redundancy terms, skills training, community-support programmes and job-seeker initiatives.

T V Narendran, Tata Steel’s chief executive officer and managing director, said: “The course we are putting forward is difficult, but we believe it is the right one. Having invested almost £5 billion in the UK business since 2007, we must transform at pace to build a sustainable business in the UK for the long-term. Our ambitious plan includes the largest capital expenditure in UK steel production in more than a decade, guaranteeing long-term, high-quality steel production in the UK and transforming the Port Talbot facility into one of Europe’s premier centres for green steelmaking.

“We recognise this proposed restructuring would have a major impact on the individuals and communities concerned, whom we will support with dignity and respect."

The steel unions – Community, Unite and GMB – met yesterday with senior representatives of Tata Steel, who formally responded to reject the multi-union plan that the unions presented to the company on November 17.

The unions said it was extremely disappointing.

They are urging Tata Steel and the Government to reconsider their positions in order to safeguard the future of British steelmaking, and head off a major industrial dispute.

"Since Tata acquired our business in 2007 they have been a responsible owner, and we recognise they have taken a long-term view where others might not have done. The coming weeks will put Tata’s values to the test," the unions statement ended.