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Tata Steel's economy growth call on Port Talbot visit Tata Steel's economy growth call on Port Talbot visit
(about 2 hours later)
Steel giant Tata is expected to warn the UK government it must take urgent action to help companies create growth.Steel giant Tata is expected to warn the UK government it must take urgent action to help companies create growth.
The company has warned it may delay lighting a £185m blast furnace in Port Talbot if the market stays subdued.The company has warned it may delay lighting a £185m blast furnace in Port Talbot if the market stays subdued.
Chief executive Karl Kohler, who is visiting south Wales, is expected to urge a reversal of policies which Tata says push Britain's energy prices up.Chief executive Karl Kohler, who is visiting south Wales, is expected to urge a reversal of policies which Tata says push Britain's energy prices up.
The UK government has pointed out that the International Monetary Fund (IMF) says its fiscal plans are appropriate.The UK government has pointed out that the International Monetary Fund (IMF) says its fiscal plans are appropriate.
The Treasury has also said that the IMF believes it is right "to support the economy through monetary and credit easing as well as government guarantees for infrastructure".The Treasury has also said that the IMF believes it is right "to support the economy through monetary and credit easing as well as government guarantees for infrastructure".
Exactly a month ago Tata steel raised the possibility that the new blast furnace at Port Talbot would not be switched on when the work is completed at the end of the year.
Then came the news that many of the workforce are facing cuts in hours and pay because of a drop off in orders.
Today's call from the boss of the European operation will be the third time there has been worrying news for the workforce.
These are difficult times for the entire steel industry, particularly as a result of the drop off in construction, and Tata is no exception.
Tata employs 7,500 people in Wales and the group has more than 395,000 staff worldwide.Tata employs 7,500 people in Wales and the group has more than 395,000 staff worldwide.
'Obstacles to recovery''Obstacles to recovery'
Mr Kohler is also expected to urge the removal of other obstacles to recovery.Mr Kohler is also expected to urge the removal of other obstacles to recovery.
His visit marks the start of work on the Number 4 blast furnace at Port Talbot, with completion due in November.His visit marks the start of work on the Number 4 blast furnace at Port Talbot, with completion due in November.
The company is also creating a £55m gas-cooling system at Port Talbot.The company is also creating a £55m gas-cooling system at Port Talbot.
Mr Kohler is expected to say the £240m investment in Wales shows commitment by the company. It is thought he will call on ministers to equal that commitment by taking immediate action to create growth.Mr Kohler is expected to say the £240m investment in Wales shows commitment by the company. It is thought he will call on ministers to equal that commitment by taking immediate action to create growth.
The company says it wants the Port Talbot works to provide a foundation for UK manufacturing, but Mr Kohler is expected to warn the UK economy faces grave challenges.The company says it wants the Port Talbot works to provide a foundation for UK manufacturing, but Mr Kohler is expected to warn the UK economy faces grave challenges.
Last month, it was revealed a third of steel workers at at Port Talbot are facing reduced shifts and pay allowance deductions because of a fall in the demand for steel.Last month, it was revealed a third of steel workers at at Port Talbot are facing reduced shifts and pay allowance deductions because of a fall in the demand for steel.
Reducing hoursReducing hours
Workers at the sister factory in Llanwern, Newport, will also be hit by changes in their shift patterns.Workers at the sister factory in Llanwern, Newport, will also be hit by changes in their shift patterns.
The company has been meeting unions to discuss a plan about reducing the hours staff work until the market recovers.The company has been meeting unions to discuss a plan about reducing the hours staff work until the market recovers.
Last week the International Monetary Fund (IMF) urged the government to slow the pace of budget cuts next year if UK growth does not recover.Last week the International Monetary Fund (IMF) urged the government to slow the pace of budget cuts next year if UK growth does not recover.
Its annual report on the UK said tax rises and spending cuts introduced since spring 2010 had cut growth by a total of 2.5% over the past two years.Its annual report on the UK said tax rises and spending cuts introduced since spring 2010 had cut growth by a total of 2.5% over the past two years.
The IMF gave a summary of the report in May, and since then, the government has introduced growth measures, such as providing funding for lending, moves which were praised by the IMF.The IMF gave a summary of the report in May, and since then, the government has introduced growth measures, such as providing funding for lending, moves which were praised by the IMF.
In response to the IMF report, a spokesman for the Treasury said: "The IMF have repeated their advice that Britain's fiscal plans are appropriate, that we are right to support the economy through monetary and credit easing as well as government guarantees for infrastructure."In response to the IMF report, a spokesman for the Treasury said: "The IMF have repeated their advice that Britain's fiscal plans are appropriate, that we are right to support the economy through monetary and credit easing as well as government guarantees for infrastructure."