No guarantees on Tata Steel

The new Labour government has given no guarantees on the future of Tata Steel in Port Talbot. Trade unions representing the steel workers had mandates to take strike action against job losses and are in talks with government.

Unions had hopes of a positive outcome after the election, but still face job losses and threats to the whole steel industry in Britain.

Fewer jobs

Keir Starmer has only said he has “great concerns” about job losses. He claimed there was “a better deal available” with Tata but warned newer technologies would employ fewer people.

The new business secretary Jonathan Reynolds might talk of job guarantees but also took the same line. He said, “Blast furnaces employ more people than some of the newer technologies available.”

‘Steel workers have pointed out the limitations of relying on electric arc furnaces.’

Neither Starmer nor Reynolds questioned the wisdom of Tata’s plans. Repeated mention of “newer technologies” means the transition to electric arc furnaces is accepted by the new government.

Steel workers have consistently pointed out the limitations of the steel industry relying solely on electric arc furnaces. These are not suitable for producing some types of steel and the contribution to reducing carbon emissions depends solely on promises of ending fossil fuel generation.

One blast furnace at Port Talbot was shut down on 5 July. The remaining blast furnace is due to close in September. It could run for longer but Tata does not accept union proposals to keep it running to the end of its useful life.

Pledge

Mentioning the Labour manifesto pledge of £2.5 billion on top of the £500 million agreed by the previous government, Reynolds also said “It’s not about underwriting loss making businesses…It is about investing in the future.”

Reynolds’s claim that “we have to make sure that decarbonisation is not de-industrialisation” flies in the face of the de-industrialisation that has been happening in Britain as a result of net zero policies. He might talk of “a better deal for Port Talbot and the steel industry as a whole” but does not mention what that means in practice.

No promises

The government says, “we have to make sure that this is a transition which works for working people and that they’re part of that.” But there is no statement by Labour that any of the planned 2,800 jobs at risk will be saved. The implication is the opposite – effective acceptance of the Tata plan and no support for the unions’ plans.

Unite announced a strike, but called off action a few days before the election. Tata had threatened to close both blast furnaces early. But talks between the union and the company took place, with both sides waiting on potential investment by a new Labour government.

Question

The unanswered question is what exactly would the pledge of £2.5 billion be used for, if not to save the blast furnace and jobs. That’s something the unions will have to work on in talks with government.

All three of the steel unions are affiliated to the Labour Party (out of a total of eleven affiliated unions). Community and GMB decided to wait for the new government in any case and to press for resumed discussion with Tata, despite votes in favour of action.