Tata Steel sale starts as manufacturing output falls
Tata Steel is set to begin the formal process of selling its UK plants today (Monday 11th).
Only one bidder has emerged publically so far – Liberty Steel, owned by Sanjeev Gupta.
However, reports say that Greybull Capital has been in talks to buy Tata Steel’s Scunthorpe business for several months and is expected to make a bid to invest up to £400m today.
The move would safeguard more than 4,000 jobs but, say reports, workers are being asked to accept a pay cut and less generous pension arrangements.
Tata Steel directly employs some 15,000 people in the UK, including 578 at Corby in Northamptonshire.
Meanwhile, the government’s failure to pursue an active industrial strategy is harming manufacturing and dashing hopes of rebalancing the economy, according to the union Unite, as official figures showed a 1.8 per cent annual fall in manufacturing output, the biggest since July 2013.
Unite points to the fact that figures from the Office for National Statistics show that UK crude steel production was at its lowest since December 2008.
Unite warned the government that its ‘hands free’ approach to manufacturing and reliance on service sector growth was “unsustainable and would lead to a low wage, low skilled economy.”
Unite assistant general secretary Tony Burke said: “With steel in the grip of an industrial crisis these figures show that the chancellor George Osborne’s ‘hands free’ approach to manufacturing is dashing hopes of rebalancing the economy.
“The absence of a coherent industrial strategy is exposing the UK’s manufacturing sector to the whims of global headwinds and risks hollowing out skills and jobs in a key sector of our nation’s economy.
“With steel communities across the UK facing uncertainty and tens of thousands of jobs in the supply chain hanging by a thread, we urge the government to adopt an active industrial strategy with steel at its heart.
“Now is the time for ministers to follow the example of their counterparts in countries like Germany by cherishing and supporting our manufacturing base. A failure to do so will lead to an ever increasing reliance on the service sector for growth and an economy built on low paid, low skilled insecure work.”
