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Steel crisis: State ready to help on Port Talbot deal - Sajid Javid Steel crisis: State ready to help on Port Talbot deal - Sajid Javid
(35 minutes later)
The government says it is ready to offer support to secure a buyer to save Port Talbot steelworks where thousands of jobs are at risk.The government says it is ready to offer support to secure a buyer to save Port Talbot steelworks where thousands of jobs are at risk.
Business Secretary Sajid Javid said he did not think nationalisation was the solution but it "wouldn't be prudent to rule anything out" to clinch a deal.Business Secretary Sajid Javid said he did not think nationalisation was the solution but it "wouldn't be prudent to rule anything out" to clinch a deal.
He said any buyer would want to look at "plant, pensions and power supply" - which ministers were "working on".He said any buyer would want to look at "plant, pensions and power supply" - which ministers were "working on".
Labour said nationalisation should be considered until a buyer is found.Labour said nationalisation should be considered until a buyer is found.
It comes after Tata Steel announced it was selling its loss-making UK businesses, which employ thousands of workers across plants in Port Talbot, Rotherham, Corbyn and Shotton. It comes amid reports of several potential buyers for the Port Talbot plant, following Tata Steel's announcement last week that it was selling its loss-making UK businesses.
Tata's UK business - which directly employs 15,000 workers and supports thousands of others - includes plants in Port Talbot, Rotherham, Corby and Shotton.
Australia trip
Mr Javid - who was on a business trip to Australia at the time - said the government had known "a few weeks ago" that Tata was reviewing its UK operations, including the possible closure of the Port Talbot plant.
But he said: "The strength of the announcement and how far they went - particularly what they said about timing - was much further than we expected."
UK steel crisisUK steel crisis
What's going wrong with Britain's steel industry?What's going wrong with Britain's steel industry?
Tata Steel UK: What are the options?Tata Steel UK: What are the options?
Is China to blame for steel woes?Is China to blame for steel woes?
Speaking on BBC One's Andrew Marr show, the business secretary - whose handling of the crisis has been criticised by opposition parties and unions - said the UK steel industry was vital for economic and national security. Speaking on BBC One's Andrew Marr show, the business secretary - whose handling of the crisis has been criticised by opposition parties and unions - said the government would do "everything we can" to support the UK steel industry, saying it was "vital" for economic and national security.
"We will do everything we can to support the industry," he said.
But he said nationalisation was "rarely the answer".But he said nationalisation was "rarely the answer".
He said the government's plan to save the plant and find a long-term solution for the steel industry was to find a commercial buyer for all of Tata's UK business. He said the government's plan to save the plant and find a long-term solution for the steel industry was to find a commercial buyer for all of Tata's UK businesses.
"The UK government knows, I've know for a while, that we're going to also have to offer support to eventually clinch that buyer and to give this steel plant a long-term viable future," he said."The UK government knows, I've know for a while, that we're going to also have to offer support to eventually clinch that buyer and to give this steel plant a long-term viable future," he said.
Mr Javid said any buyer would want "to look at what I have referred to internally as the 'three p's' - plant, pensions and... power supply". Analysis
By Joe Lynam, BBC business correspondent
It's always helpful when we get clearly memorable acronyms to understand very complex issues.
In the case of the crisis facing Port Talbot steel workers, Business Secretary Sajid Javid gave us the '3 Ps': plant, pensions and power.
The plant is what type of steel Port Talbot will be making in future. The mass produced or commodity type can be easily undercut by much cheaper Chinese steel - so it needs to focus on more specialist types which can compete on world markets.
Tata Steel has a pensions deficit of £485m. But it is 97% funded which means few buyers will walk away from the table over relatively small sums.
The final 'P 'is the cost of electricity. Making steel is probably the most energy hungry activity you can do. The government has already started refunding companies the additional electricity charges they had to pay as major CO2-emitting industries.
Subsidising power costs would breach EU state aid rules so finding a clever solution here could be the key to persuading any future owners.
Mr Javid said any buyer would want "to look at what I have referred to internally as the 'three P's' - plant, pensions and... power supply".
He added: "These are the kind of things we've already thought, we've already started working on, and what I hope is that you will have the offer document from Tata, overlay on top of that the help the British government can provide, then you have the makings of a successful deal."He added: "These are the kind of things we've already thought, we've already started working on, and what I hope is that you will have the offer document from Tata, overlay on top of that the help the British government can provide, then you have the makings of a successful deal."
He suggested "more can be done" on the cost of electricity at the plant and regarding a pension scheme to attract potential investors - but he would not be drawn on the details.He suggested "more can be done" on the cost of electricity at the plant and regarding a pension scheme to attract potential investors - but he would not be drawn on the details.
Mr Javid said Tata had accepted that finalising any deal would take time.Mr Javid said Tata had accepted that finalising any deal would take time.
But he would not guarantee the plant's future, but said: "I will do everything I can to keep this plant open."But he would not guarantee the plant's future, but said: "I will do everything I can to keep this plant open."
'Shovel-ready projects''Shovel-ready projects'
Labour is calling for the industry to be temporarily nationalised until a buyer is found.Labour is calling for the industry to be temporarily nationalised until a buyer is found.
On Marr, shadow chancellor John McDonnell also suggested the government could maintain a stake in the plant after a sale.On Marr, shadow chancellor John McDonnell also suggested the government could maintain a stake in the plant after a sale.
"You might want to say there is a public stake there for the long term future to give us that security. It depends on the levels of investment," he said."You might want to say there is a public stake there for the long term future to give us that security. It depends on the levels of investment," he said.
Mr McDonnell also called on the government to bring forward infrastructure projects and speed up "shovel-ready projects", to give the steel industry a boost and encourage buyers.Mr McDonnell also called on the government to bring forward infrastructure projects and speed up "shovel-ready projects", to give the steel industry a boost and encourage buyers.
He warned that the cost of closing the plant could be up to "£1.5bn a year" in welfare payments to support workers who had lost their jobs and the impact on the local community.He warned that the cost of closing the plant could be up to "£1.5bn a year" in welfare payments to support workers who had lost their jobs and the impact on the local community.
'Steel dumping''Steel dumping'
In an effort to help save the industry, the government has said that public sector bodies will be encouraged to buy British steel for construction projects.In an effort to help save the industry, the government has said that public sector bodies will be encouraged to buy British steel for construction projects.
They will need to consider local economic and social factors and carbon footprint when awarding contracts, taking into account the "true value" of British steel.They will need to consider local economic and social factors and carbon footprint when awarding contracts, taking into account the "true value" of British steel.
Contractors working for the public sector will also be required to advertise their requirements for steel so that UK firms can compete for the business.Contractors working for the public sector will also be required to advertise their requirements for steel so that UK firms can compete for the business.
The Local Government Association told the BBC that councils already considered local economic and social factors when awarding contracts.The Local Government Association told the BBC that councils already considered local economic and social factors when awarding contracts.
It comes after heavy criticism of ministers for failing to take more effective action to prevent the "dumping" of cheap Chinese steel, seen as one of the key reasons for the problems in the UK steel industry.It comes after heavy criticism of ministers for failing to take more effective action to prevent the "dumping" of cheap Chinese steel, seen as one of the key reasons for the problems in the UK steel industry.
The unions said it was "a small step in the right direction" but the measure should have been in place already.The unions said it was "a small step in the right direction" but the measure should have been in place already.
Shadow business secretary Angela Eagle said ministers had been dragged "kicking and screaming to take action" and needed to do more if they were to ensure the industry's survival.Shadow business secretary Angela Eagle said ministers had been dragged "kicking and screaming to take action" and needed to do more if they were to ensure the industry's survival.
The government has played down the impact of new Chinese import tariffs of up to 46.3%.The government has played down the impact of new Chinese import tariffs of up to 46.3%.
On Marr, Mr Javid said the UK had been "a leader" in pushing for action on tariffs but he said protectionism "is in no-one's interests". On Marr, Mr Javid said the UK had been "the leader" in pushing for action on tariffs but he said protectionism "is in no-one's interests".
Potential buyerPotential buyer
Steel tycoon Sanjeev Gupta, founder of commodities firm Liberty House, has emerged as one possible buyer for the Port Talbot steelworks.Steel tycoon Sanjeev Gupta, founder of commodities firm Liberty House, has emerged as one possible buyer for the Port Talbot steelworks.
He told The Sunday Telegraph he had already opened discussions with Tata Steel and was ready to hold talks with the government.He told The Sunday Telegraph he had already opened discussions with Tata Steel and was ready to hold talks with the government.
"I haven't made a proposition that I want to buy all of [Tata Steel UK] because that's too big an undertaking to even put on the table at this stage," he said."I haven't made a proposition that I want to buy all of [Tata Steel UK] because that's too big an undertaking to even put on the table at this stage," he said.
German steelmaker ThyssenKrupp has also been touted as another potential buyer, according to the Observer.German steelmaker ThyssenKrupp has also been touted as another potential buyer, according to the Observer.
Steel production makes up 1% of Britain's manufacturing output and 0.1% of the country's economic output.Steel production makes up 1% of Britain's manufacturing output and 0.1% of the country's economic output.