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Tata: Government considers 'all options' for Port Talbot Tata: Government considers 'all options' for Port Talbot
(35 minutes later)
The government is considering "all options" for Tata's Port Talbot steel plant UK Business Minister Anna Soubry has told the BBC.The government is considering "all options" for Tata's Port Talbot steel plant UK Business Minister Anna Soubry has told the BBC.
She wants the company to take enough time to find a buyer for the plant but, failing that, is considering other options including government support. She wants the company to take enough time to find a buyer for the plant. Failing that, other options being considered include government support.
She stressed that the UK had to work within EU rules over state aid. But she stressed that the UK had to work within EU rules over state aid.
India's Tata Steel plans to sell its loss-making UK business, putting the jobs of thousands of workers at risk. It is feared India's Tata Steel plans to sell its loss-making UK business, putting thousands of jobs at risk.
Tata's European holding company has been told to "explore all options for restructuring", including the partial or entire sale of its UK operations.Tata's European holding company has been told to "explore all options for restructuring", including the partial or entire sale of its UK operations.
Another option would be a management buy-out, and sources say that unions and management at Tata Steel have already come up with with a turnaround plan for the Port Talbot plant. Tata's decision, which was announced after a board meeting in Mumbai on Tuesday, also affects workers at its other UK plants, including Rotherham, Corby and Shotton. There has been no specific mention of these plants from the government.
Tata's decision, which was announced after a board meeting in Mumbai on Tuesday, also affects workers at its other UK plants, including Rotherham, Corby and Shotton. Tata's Scunthorpe and Lanarkshire plants are in the process of being bought.
'All options' One option for Port Talbot, which is the UK's biggest steel plant, would be a management buy-out.
Sources say that unions and management at Tata Steel have already come up with with a turnaround plan for the 100-year old plant.
Time needed
It is understood that ministers are concerned Tata could seek to close the plant within weeks if a buyer is not found.
It is also understood the government is looking at offering loan guarantees to potential buyers and much tighter rules on procurement to ensure major British projects are obliged to buy British Steel.
When asked on the BBC's Today programme whether the government would be prepared to nationalise Tata's remaining steel plants, Ms Soubry said: "We are, and have, and continue to look at, all options and I do mean all options.When asked on the BBC's Today programme whether the government would be prepared to nationalise Tata's remaining steel plants, Ms Soubry said: "We are, and have, and continue to look at, all options and I do mean all options.
"But what we first want to achieve is from Tata is this period of time to allow a proper sale process.""But what we first want to achieve is from Tata is this period of time to allow a proper sale process."
However, when pressed, she said there was a limit to what the government could do: "We have to be very careful because we have these state aid rules, which have been established for well over 50 years."However, when pressed, she said there was a limit to what the government could do: "We have to be very careful because we have these state aid rules, which have been established for well over 50 years."
She said there was sympathy for Tata which had invested an "extraordinary" amount in its UK steel operations.She said there was sympathy for Tata which had invested an "extraordinary" amount in its UK steel operations.
Tata's Port Talbot site alone, which employs 5,500 of Tata UK's 15,000-strong UK workforce, is thought to be losing £1m a day.
Government sources have said those involved in the plant should be given the chance to see if they can secure the funding to keep it going.
"It is the role of the government to intervene when a vital economic interest is at stake," a source told BBC assistant political editor Norman Smith.
It is understood there have been extensive talks between the government and ministers, who are concerned Tata could seek to close the plant within weeks if a buyer is not found.
It is also understood the government is looking at offering loan guarantees to potential buyers and much tighter rules on procurement to ensure major British projects are obliged to buy British Steel.
Labour leader Jeremy Corbyn had called for ministers to act to protect the steel industry and "the core of manufacturing in Britain".Labour leader Jeremy Corbyn had called for ministers to act to protect the steel industry and "the core of manufacturing in Britain".
Roy Rickhuss, general secretary of the trade union Community, who met representatives from Tata in Mumbai on Tuesday to plead the case for the UK business, said he would fight hard: "We will not let the steel industry in the UK die. We are not going silently into the night. We will make sure we do everything we can to create a sustainable industry in the UK."
Tata's Port Talbot site alone, which employs 5,500 of Tata UK's current 15,000-strong UK workforce, is thought to be losing £1m a day.
'Tireless''Tireless'
The UK and Welsh governments earlier issued a joint statement saying they were "committed to working with Tata and the unions on a long-term sustainable future for British steel-making.The UK and Welsh governments earlier issued a joint statement saying they were "committed to working with Tata and the unions on a long-term sustainable future for British steel-making.
"Both the UK and Welsh governments are working tirelessly to look at all viable options to keep a strong British steel industry at the heart of our manufacturing base.""Both the UK and Welsh governments are working tirelessly to look at all viable options to keep a strong British steel industry at the heart of our manufacturing base."
Meanwhile, Plaid Cymru leader Leanne Wood said that her party wanted the Welsh Assembly to be recalled to discuss the crisis - a call that was echoed by Welsh Conservatives leader Andrew Davies.Meanwhile, Plaid Cymru leader Leanne Wood said that her party wanted the Welsh Assembly to be recalled to discuss the crisis - a call that was echoed by Welsh Conservatives leader Andrew Davies.
ImpactImpact
Explaining its decision sell the UK business, Tata said trading conditions had "rapidly deteriorated" in the UK and Europe due to a global oversupply of steel, cheap steel imports, high costs and currency volatility.Explaining its decision sell the UK business, Tata said trading conditions had "rapidly deteriorated" in the UK and Europe due to a global oversupply of steel, cheap steel imports, high costs and currency volatility.
"These factors are likely to continue into the future and have significantly impacted the long-term competitive position of the UK operation," it said."These factors are likely to continue into the future and have significantly impacted the long-term competitive position of the UK operation," it said.
There have been allegations that Chinese steel is being "dumped" on world markets at prices that UK plants cannot hope to compete with.There have been allegations that Chinese steel is being "dumped" on world markets at prices that UK plants cannot hope to compete with.
That means finding a commercial buyer for the whole business may not be easy.That means finding a commercial buyer for the whole business may not be easy.
Colin Hamilton, commodities expert at Macquarie Group, told the BBC: "Steel demand is still falling. It peaked in 2013. It is very hard to see who would buy the 'hot end' of the business, the steel making end itself, although the rolling mills are more attractive, I think its is unlikely we will see a buyer for the business as a whole."Colin Hamilton, commodities expert at Macquarie Group, told the BBC: "Steel demand is still falling. It peaked in 2013. It is very hard to see who would buy the 'hot end' of the business, the steel making end itself, although the rolling mills are more attractive, I think its is unlikely we will see a buyer for the business as a whole."
Steel making was once a major UK industry, employing 250,000 at its peak.
Tata Steel has been operating in the UK since 2007 when it bought Anglo-Dutch steelmaker Corus.Tata Steel has been operating in the UK since 2007 when it bought Anglo-Dutch steelmaker Corus.
In January the company announced more than 1,000 UK job cuts, including 750 in Port Talbot, where it employs 4,000 staff and a further 3,000 contractors and temporary workers.In January the company announced more than 1,000 UK job cuts, including 750 in Port Talbot, where it employs 4,000 staff and a further 3,000 contractors and temporary workers.
And last October Tata Steel said nearly 1,200 jobs would go at plants in Scunthorpe and Lanarkshire.And last October Tata Steel said nearly 1,200 jobs would go at plants in Scunthorpe and Lanarkshire.
Do you live in the affected areas? Let us know about your experiences. Email haveyoursay@bbc.co.uk with your stories. Do you work at the Port Talbot steel plant? How will the plans to sell it affect you and your family? Let us know about your experiences. Email haveyoursay@bbc.co.uk with your stories.
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