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Tata steel crisis: UK government accused of putting China's interests first - live Tata steel crisis: UK government accused of putting China's interests first - live
(35 minutes later)
12.23pm BST
12:23
Tata won't comment on German tie-up reports
Graham Ruddick
Tata Steel is declining to comment on those reports that it is planning a tie-up with Germany’s Thyssenkrupp, once it has shed its UK operations.
Asked about the story, Tata would only say:
We do not comment on media speculation.
Tata also confirmed that it has appointed PwC to advise it about the restructuring of its UK business, but won’t give further details.
A spokesperson in Port Talbot says:
Like all large firms we use a range of professional advisors for tasks where they have particular expertise. We don’t make public statements on the details of such advisory relationships.
12.17pm BST
12:17
Osborne: We're doing everything we can
George Osborne has just hit back at the stinging criticism that the government has been pandering to China rather than protecting the UK steel industry.
Speaking in Manchester, the chancellor declared:
“Internationally we are working to make sure that there are tariffs on unfair cheap exports.
Domestically we are doing everything we practically can, everything we possibly can to help the steel workers, help the steel industry.
That’s why the business secretary is is there in Port Talbot today, looking for long-term solutions.
That may come as a surprise to the European Steel Association, who insist that Britain has NOT been been doing everything it can, and has been the ringleader in blocking higher Chinese tariffs.
Osborne was sporting a high-visibility jacket but had ditched the hard hat that he often wears for photo ops (maybe he’s lent it to Sajid Javid for protection against irate steel workers....)
11.37am BST11.37am BST
11:3711:37
UK taxpayers could be forced to stump up £1.5bn per year if the government bites the nationalisation bullet and takes Tata UK’s operations into public hands.UK taxpayers could be forced to stump up £1.5bn per year if the government bites the nationalisation bullet and takes Tata UK’s operations into public hands.
That’s clearly not-insignificant sum of money. So what else could we do with it? Well, you can get half an aircraft carrier -- although that wouldn’t stretch to any planes.That’s clearly not-insignificant sum of money. So what else could we do with it? Well, you can get half an aircraft carrier -- although that wouldn’t stretch to any planes.
And it’s only a fifth of the cost of a new nuclear sub, or just 3% of the bill for building the HS2 railway link...And it’s only a fifth of the cost of a new nuclear sub, or just 3% of the bill for building the HS2 railway link...
For more neat comparisons, click here:For more neat comparisons, click here:
Related: What the UK could buy for £1.5bn (instead of spending it on Tata Steel)Related: What the UK could buy for £1.5bn (instead of spending it on Tata Steel)
UpdatedUpdated
at 11.53am BSTat 11.53am BST
11.23am BST11.23am BST
11:2311:23
In another potential embarrassment for the UK government, Tata is reportedly considering taking a stake in the steel unit of Germany’s Thyssenkrupp.In another potential embarrassment for the UK government, Tata is reportedly considering taking a stake in the steel unit of Germany’s Thyssenkrupp.
German business paper Rheinische Post reports that talks between the two parties are at an “advanced stage”.German business paper Rheinische Post reports that talks between the two parties are at an “advanced stage”.
One option is that they could create a joint venture, with Tata Steel holding an option to increase the stake at a later date, apparently.One option is that they could create a joint venture, with Tata Steel holding an option to increase the stake at a later date, apparently.
Tata Steel have declined to comment on the claims to Reuters.Tata Steel have declined to comment on the claims to Reuters.
If it’s true, it shows that Tata remains interested in European steel operations despite the problems in the UK.If it’s true, it shows that Tata remains interested in European steel operations despite the problems in the UK.
Shares in ThyssenKrupp have jumped by almost 5% this morning. Analysts have already speculated that a merger between the German and Indian firms makes sense, given the tough conditions in the global steel market.Shares in ThyssenKrupp have jumped by almost 5% this morning. Analysts have already speculated that a merger between the German and Indian firms makes sense, given the tough conditions in the global steel market.
Tata Steel, Thyssenkrupp in steel unit talks: Report https://t.co/xePinuslT0 pic.twitter.com/H311rV0HCsTata Steel, Thyssenkrupp in steel unit talks: Report https://t.co/xePinuslT0 pic.twitter.com/H311rV0HCs
10.29am BST10.29am BST
10:2910:29
Workers in Port Talbot are eagerly awaiting the arrival of business secretary Sajid Javid in a few hours time.Workers in Port Talbot are eagerly awaiting the arrival of business secretary Sajid Javid in a few hours time.
We’re expecting to hear from the business secretary in the early afternoon, as he meets with workers, management and unions.We’re expecting to hear from the business secretary in the early afternoon, as he meets with workers, management and unions.
He will need to explain how the government allowed the crisis to reach this point, why they have blocked higher tariffs on Chinese steel, and whether his own job could be at risk.He will need to explain how the government allowed the crisis to reach this point, why they have blocked higher tariffs on Chinese steel, and whether his own job could be at risk.
Javid will tell workers that the government is “on their side”; but the Welsh community in around Port Talbot want to hear action, not platitudes.Javid will tell workers that the government is “on their side”; but the Welsh community in around Port Talbot want to hear action, not platitudes.
So it could be a pretty uncomfortable trip for Javid -- who may already be suffering the effects of those two long flights to Australia and back this week.So it could be a pretty uncomfortable trip for Javid -- who may already be suffering the effects of those two long flights to Australia and back this week.
10.13am BST10.13am BST
10:1310:13
Steel tariff row explainedSteel tariff row explained
Here’s a Q&A on the steel tariffs row, from Kate Ferguson of the Press Association.Here’s a Q&A on the steel tariffs row, from Kate Ferguson of the Press Association.
Q: What is a tariff?Q: What is a tariff?
A tariff is a form of tax imposed on goods or services imported from abroad. It can restrict trade by making products more expensive, and can be used as a form of protectionism - to protect and encourage domestic industry.A tariff is a form of tax imposed on goods or services imported from abroad. It can restrict trade by making products more expensive, and can be used as a form of protectionism - to protect and encourage domestic industry.
Many in the UK steel industry have demanded higher tariffs be imposed on imported steel amid concerns Chinese steel dumping has sent prices plummeting.Many in the UK steel industry have demanded higher tariffs be imposed on imported steel amid concerns Chinese steel dumping has sent prices plummeting.
Q: What is steel dumping and why are the Chinese accused of it?Q: What is steel dumping and why are the Chinese accused of it?
Steel production in China has soared over the past decade and it now produces around half of the world’s annual output of 1.6 billion tonnes. But its domestic market has been slowing, leading steel producers to seek to export more.Steel production in China has soared over the past decade and it now produces around half of the world’s annual output of 1.6 billion tonnes. But its domestic market has been slowing, leading steel producers to seek to export more.
China has been accused of “dumping” its steel on European markets - which means selling it not just cheaply, but at a loss. In 2014, Chinese steel imports to the UK cost €583 a tonne compared to €897 a tonne for steel produced elsewhere in the EU, according to reports quoting the EU’s statistics agency, Eurostat.China has been accused of “dumping” its steel on European markets - which means selling it not just cheaply, but at a loss. In 2014, Chinese steel imports to the UK cost €583 a tonne compared to €897 a tonne for steel produced elsewhere in the EU, according to reports quoting the EU’s statistics agency, Eurostat.
Q: Why has the British Government been criticised for not doing enough to protect the UK steel industry?Q: Why has the British Government been criticised for not doing enough to protect the UK steel industry?
Sharply falling prices and a flood of cheap, foreign steel has sparked major concern for the future of the British steel industry, and the many jobs that depend on it.Sharply falling prices and a flood of cheap, foreign steel has sparked major concern for the future of the British steel industry, and the many jobs that depend on it.
British ministers blocked proposals in the EU to get rid of the “lesser duty rule” which caps tariffs at 9% - in the US some products face a tariff of up to 236%. The British Government has said the 9% tariff is too low, but warned against lurching towards protectionism.British ministers blocked proposals in the EU to get rid of the “lesser duty rule” which caps tariffs at 9% - in the US some products face a tariff of up to 236%. The British Government has said the 9% tariff is too low, but warned against lurching towards protectionism.
The debate comes as Britain has been courting China hard in a bid to foster closer trade links. Chancellor George Osborne said the two nations should “stick together and create a golden decade” while on a visit to China last September.The debate comes as Britain has been courting China hard in a bid to foster closer trade links. Chancellor George Osborne said the two nations should “stick together and create a golden decade” while on a visit to China last September.
The following month, Chinese President Xi Jinping visited Britain and was treated to a State banquet at Buckingham Palace, where he sat between the Queen and the Duchess of Cambridge.The following month, Chinese President Xi Jinping visited Britain and was treated to a State banquet at Buckingham Palace, where he sat between the Queen and the Duchess of Cambridge.
Set in this context, the Government has been accused of betraying British steelworkers to curry favour with the Chinese.Set in this context, the Government has been accused of betraying British steelworkers to curry favour with the Chinese.
UpdatedUpdated
at 10.18am BSTat 10.18am BST
9.52am BST9.52am BST
09:5209:52
Britain’s manufacturing sector has suffered another tough month, according to the latest survey from data firm Markit.Britain’s manufacturing sector has suffered another tough month, according to the latest survey from data firm Markit.
Export orders contracting for a third month in a row, and firms reported that they laid off staff again.Export orders contracting for a third month in a row, and firms reported that they laid off staff again.
The overall PMI, which measures activity, came in at 51. That shows marginal growth, underlining how UK factories are struggling despite talk of economic recovery.The overall PMI, which measures activity, came in at 51. That shows marginal growth, underlining how UK factories are struggling despite talk of economic recovery.
9.20am BST9.20am BST
09:2009:20
Clegg: Osborne has put China ahead of UKClegg: Osborne has put China ahead of UK
Nick Clegg, the former deputy prime minister, has waded into the steel crisis row this morning.Nick Clegg, the former deputy prime minister, has waded into the steel crisis row this morning.
Clegg pinned the blame for Port Talbot’s woes firmly on chancellor George Osborne, accusing him of prioritising relations with China over the future of UK industry.Clegg pinned the blame for Port Talbot’s woes firmly on chancellor George Osborne, accusing him of prioritising relations with China over the future of UK industry.
Clegg, who was in government between 2010 and 2015, said:Clegg, who was in government between 2010 and 2015, said:
“George Osborne has put his special relationship with China above the UK’s best interests.“George Osborne has put his special relationship with China above the UK’s best interests.
The Conservative Government have continually failed to take action and missed many opportunities to help the UK steel industry, such as taking steps to prevent dumping of cheap Chinese steel on the UK market.The Conservative Government have continually failed to take action and missed many opportunities to help the UK steel industry, such as taking steps to prevent dumping of cheap Chinese steel on the UK market.
“The Government must now act before more steel jobs across the UK are put at risk.”“The Government must now act before more steel jobs across the UK are put at risk.”
(thanks to the Press Association for the quotes)(thanks to the Press Association for the quotes)
There’s no argument that George Osborne is committed to building closer economic, political and diplomatic ties with China.There’s no argument that George Osborne is committed to building closer economic, political and diplomatic ties with China.
The Economist recently dubbed this the “Osborne Doctrine”, warning that the chancellor is leading a radical, and under-examined, shift in policy.The Economist recently dubbed this the “Osborne Doctrine”, warning that the chancellor is leading a radical, and under-examined, shift in policy.
The UK steel crisis means Osborne’s relationship with Beijing is now under much closer scrutiny.The UK steel crisis means Osborne’s relationship with Beijing is now under much closer scrutiny.
Bagehot: The Osborne Doctrine https://t.co/a7t0Hn2pUq via @TheEconomistBagehot: The Osborne Doctrine https://t.co/a7t0Hn2pUq via @TheEconomist
9.05am BST9.05am BST
09:0509:05
Labour MP Stephen Kinnock piled further pressure on Sajid Javid last night, saying the business secretary should ‘consider his position’.Labour MP Stephen Kinnock piled further pressure on Sajid Javid last night, saying the business secretary should ‘consider his position’.
The Huffington Post’s Graeme Demianyk has neatly summarised why Javid is under fire:The Huffington Post’s Graeme Demianyk has neatly summarised why Javid is under fire:
More here: Sajid Javid Accused Of ‘Boundless Stores Of Incompetence’ Over UK Steel CrisisMore here: Sajid Javid Accused Of ‘Boundless Stores Of Incompetence’ Over UK Steel Crisis
8.53am BST8.53am BST
08:5308:53
Could nationalising the UK steel industry work?Could nationalising the UK steel industry work?
Plenty of people are pointing out that Tata UK’s losses of £1m per day are dwarfed by the multi-billion pound cost of rescuing the banks in 2008.Plenty of people are pointing out that Tata UK’s losses of £1m per day are dwarfed by the multi-billion pound cost of rescuing the banks in 2008.
David Cameron says it’s not the long-term answer, but we should remember that a previous Conservative prime minister, Edward Heath, showed that nationalisation can work.David Cameron says it’s not the long-term answer, but we should remember that a previous Conservative prime minister, Edward Heath, showed that nationalisation can work.
Our economics editor Larry Elliott explains:Our economics editor Larry Elliott explains:
In 1971, Whitehall stepped in after Rolls-Royce went into receivership.In 1971, Whitehall stepped in after Rolls-Royce went into receivership.
The nationalisation of Rolls-Royce counters the argument that state rescues are always about bailing out “lame ducks”. Heath took a gamble that the company had failed due to the unexpectedly high costs of developing a new, advanced RB211 jet engine but had a long-term future.The nationalisation of Rolls-Royce counters the argument that state rescues are always about bailing out “lame ducks”. Heath took a gamble that the company had failed due to the unexpectedly high costs of developing a new, advanced RB211 jet engine but had a long-term future.
Rolls-Royce came through its temporary difficulties and became one of Britain’s few genuinely world-class companies. After 16 years under public ownership, it was privatised by Margaret Thatcher’s government in 1987.Rolls-Royce came through its temporary difficulties and became one of Britain’s few genuinely world-class companies. After 16 years under public ownership, it was privatised by Margaret Thatcher’s government in 1987.
Related: Public ownership of Tata Steel could work – just look at Rolls-RoyceRelated: Public ownership of Tata Steel could work – just look at Rolls-Royce
And if all else fails...And if all else fails...
Brilliant ! British steel crisis — Cartoon Kipper Williams in The Guardian — https://t.co/0YWjykBp5S pic.twitter.com/gMvTG2s6xBBrilliant ! British steel crisis — Cartoon Kipper Williams in The Guardian — https://t.co/0YWjykBp5S pic.twitter.com/gMvTG2s6xB
8.39am BST8.39am BST
08:3908:39
Unions demand Britain stops protecting Chinese steelUnions demand Britain stops protecting Chinese steel
Union leaders are going to urge business secretary Sajid Javid to stop blocking higher tariffs on Chinese steel, when he arrives in Port Talbot today.Union leaders are going to urge business secretary Sajid Javid to stop blocking higher tariffs on Chinese steel, when he arrives in Port Talbot today.
Unite Wales secretary Andy Richards warns that warm words and PR photocalls simply won’t cut it; Javid must take action:Unite Wales secretary Andy Richards warns that warm words and PR photocalls simply won’t cut it; Javid must take action:
Richards says:Richards says:
“When he meets steelworkers, Sajid Javid needs to commit to ensuring British steel can compete on a level playing field by promising to drop his opposition to higher EU tariffs of cheap Chinese steel and honour the commitments to help with energy costs which were quietly watered down by George Osborne in his budget. But most of all he needs to signal his commitment to steel and manufacturing by promising to back British steel with a line of financial support to get it through these dark days.“When he meets steelworkers, Sajid Javid needs to commit to ensuring British steel can compete on a level playing field by promising to drop his opposition to higher EU tariffs of cheap Chinese steel and honour the commitments to help with energy costs which were quietly watered down by George Osborne in his budget. But most of all he needs to signal his commitment to steel and manufacturing by promising to back British steel with a line of financial support to get it through these dark days.
This crisis goes beyond Wales, Richards adds. The whole UK steel industry is in crisis.This crisis goes beyond Wales, Richards adds. The whole UK steel industry is in crisis.
He needs to look workers in the eye, not just at Port Talbot, but at sites across Tata Steel from Shotton and Llanwern, to Rotherham and Corby and say your government backs you. A failure to do so will leave workers feeling his visit to Port Talbot is nothing more than an empty PR stunt and intensify the need for David Cameron to take personal control in securing a future for the UK steel industry.”He needs to look workers in the eye, not just at Port Talbot, but at sites across Tata Steel from Shotton and Llanwern, to Rotherham and Corby and say your government backs you. A failure to do so will leave workers feeling his visit to Port Talbot is nothing more than an empty PR stunt and intensify the need for David Cameron to take personal control in securing a future for the UK steel industry.”
UpdatedUpdated
at 9.21am BSTat 9.21am BST
8.14am BST8.14am BST
08:1408:14
It’s another morning of bad front pages for the UK government.It’s another morning of bad front pages for the UK government.
Both the Times and the Financial Times are splashing on accusations that Britain undermined efforts to protect Europe against imports of cheap Chinese steel.Both the Times and the Financial Times are splashing on accusations that Britain undermined efforts to protect Europe against imports of cheap Chinese steel.
Friday's FT:UK accused of blocking EU move to shut out cheap steel that hurt Tata#tomorrowspaperstoday #bbcpapers pic.twitter.com/zlt2Zpjr4vFriday's FT:UK accused of blocking EU move to shut out cheap steel that hurt Tata#tomorrowspaperstoday #bbcpapers pic.twitter.com/zlt2Zpjr4v
Friday's Times front page:Steel crisis blamed on desire to woo Beijing#tomorrowspaperstoday #bbcpapers pic.twitter.com/tCtApoIrgxFriday's Times front page:Steel crisis blamed on desire to woo Beijing#tomorrowspaperstoday #bbcpapers pic.twitter.com/tCtApoIrgx
7.57am BST7.57am BST
07:5707:57
Steel industry: UK is ringleader against China steel clampdownSteel industry: UK is ringleader against China steel clampdown
Britain has been accused of deliberately undermining efforts to protect Europe’s steel industry from a deluge of unfairly cheap steel from China.Britain has been accused of deliberately undermining efforts to protect Europe’s steel industry from a deluge of unfairly cheap steel from China.
In an embarrassing development for the UK government, European steel industry has said Britain has been the ‘ringleader’ in a move to prevent higher tariffs being imposed on cheap Chinese steel imports.In an embarrassing development for the UK government, European steel industry has said Britain has been the ‘ringleader’ in a move to prevent higher tariffs being imposed on cheap Chinese steel imports.
Charles De Lusignan, spokesperson for the European Steel Association, has told Radio 4’s Today Programme that:Charles De Lusignan, spokesperson for the European Steel Association, has told Radio 4’s Today Programme that:
We have been talking about the lifting of the lesser duty rule in particular for a long time. The fact is that the UK has been blocking this.We have been talking about the lifting of the lesser duty rule in particular for a long time. The fact is that the UK has been blocking this.
They’re not the only member state, but they are certainly the ringleader in blocking the lifting of the lesser duty rule.They’re not the only member state, but they are certainly the ringleader in blocking the lifting of the lesser duty rule.
The Commission has been pushing to lift the lesser duty rule since 2013, De Lusignan continues, in an attempt to prevent the ‘dumping’ of steel on the European market.The Commission has been pushing to lift the lesser duty rule since 2013, De Lusignan continues, in an attempt to prevent the ‘dumping’ of steel on the European market.
The fact that the UK continues to block it means that when the government says its doing everything it takes to save the steel industry in the UK and in Europe It’s not. It’s simply not true.The fact that the UK continues to block it means that when the government says its doing everything it takes to save the steel industry in the UK and in Europe It’s not. It’s simply not true.
Currently, the EU sets a tariff of up to 16% on dumped Chinese cold-rolled steel – a high-value product used to make car parts, household appliances and furniture . America, though, imposes fixed duties of over 200% on some steel products.Currently, the EU sets a tariff of up to 16% on dumped Chinese cold-rolled steel – a high-value product used to make car parts, household appliances and furniture . America, though, imposes fixed duties of over 200% on some steel products.
De Lusignan also insists that European steel workers are losing their jobs because Chinese steel mills are selling steel here for less than the cost of making it.De Lusignan also insists that European steel workers are losing their jobs because Chinese steel mills are selling steel here for less than the cost of making it.
His comments echo points made to the Guardian last month by his boss, Axel Eggert, director general of the European Steel Association.His comments echo points made to the Guardian last month by his boss, Axel Eggert, director general of the European Steel Association.
Eggert told our Brussels correspondent, Jennifer Rankin, that the UK was fighting attempts to retaliate against cheap steel from China.Eggert told our Brussels correspondent, Jennifer Rankin, that the UK was fighting attempts to retaliate against cheap steel from China.
“The UK is the big opposing member state and is the driving force against the opposition of the lifting of the lesser duty rule, so it would be crucial that the UK would lift its opposition.”“The UK is the big opposing member state and is the driving force against the opposition of the lifting of the lesser duty rule, so it would be crucial that the UK would lift its opposition.”
Eggert was also surprised that the UK, which is “often closer to the US than the EU” did not share the US view on trade defence.Eggert was also surprised that the UK, which is “often closer to the US than the EU” did not share the US view on trade defence.
As he put it:As he put it:
“Why doesn’t the US have such a strong position to implement fair trade and why does the EU not have this.”“Why doesn’t the US have such a strong position to implement fair trade and why does the EU not have this.”
Something for Sajid Javid to answer in Port Talbot today......Something for Sajid Javid to answer in Port Talbot today......
UpdatedUpdated
at 10.10am BSTat 10.10am BST
7.37am BST7.37am BST
07:3707:37
The agenda: Business secretary to visit Port TalbotThe agenda: Business secretary to visit Port Talbot
Good morning and welcome to our rolling coverage of the world economy, the financial markets and business.Good morning and welcome to our rolling coverage of the world economy, the financial markets and business.
Britain’s steel crisis rumbles on, with no signs of a breakthrough that could save tens of thousands of jobs across the troubled industry.Britain’s steel crisis rumbles on, with no signs of a breakthrough that could save tens of thousands of jobs across the troubled industry.
Business secretary Sajid Javid is expected to visit Port Talbot today after (finally) returning to the UK from his visit to Australia (possibly with a non-too-impressed teenage daughter in tow).Business secretary Sajid Javid is expected to visit Port Talbot today after (finally) returning to the UK from his visit to Australia (possibly with a non-too-impressed teenage daughter in tow).
Having aborted his visit Down Under on Wednesday, the under-fire Javid will be meeting with workers, managers, unions, MPs and members of the Welsh government today.Having aborted his visit Down Under on Wednesday, the under-fire Javid will be meeting with workers, managers, unions, MPs and members of the Welsh government today.
His message -- that ministers are doing everything they can to secure the long-term future of the company and steel industry.His message -- that ministers are doing everything they can to secure the long-term future of the company and steel industry.
Stung by criticism of being ‘asleep at the wheel’, the government has already started looking for a buyer for Tata UK’s assets.Stung by criticism of being ‘asleep at the wheel’, the government has already started looking for a buyer for Tata UK’s assets.
Nationalisation, is seems, has been ruled out - despite the Labour Party calling for an immediate show of support for steel.Nationalisation, is seems, has been ruled out - despite the Labour Party calling for an immediate show of support for steel.
Related: Tata Steel: ministers start hunt for buyers for British assetsRelated: Tata Steel: ministers start hunt for buyers for British assets
Also coming up today:Also coming up today:
9.30am: We find how well, or badly, Britain’s wider manufacturing industry fared last month, when data firm Markit publishes its latest Purchasing Managers Index.9.30am: We find how well, or badly, Britain’s wider manufacturing industry fared last month, when data firm Markit publishes its latest Purchasing Managers Index.
1.30pm: America’s latest unemployment report is published, showing how many new jobs were created in the world’s largest economy.1.30pm: America’s latest unemployment report is published, showing how many new jobs were created in the world’s largest economy.
We’re also getting new UK house price data from Nationwide, and financial results from the Co-operative Bank.We’re also getting new UK house price data from Nationwide, and financial results from the Co-operative Bank.
Steel, though, is the main story today.Steel, though, is the main story today.
UpdatedUpdated
at 7.37am BSTat 7.37am BST