270 jobs lost as Tata Steel closes Scottish operations

Tata said today’s announcement comes in response to a shift in market conditions caused by a flood of cheap imports, particularly from China, a strong pound and high electricity costs.

The proposed changes to Tata’s Long Products Europe business will also see 900 jobs go at its facility in Scunthorpe, bringing the total loss of jobs up to 1,200 across its UK sites.

Plate mills in Scunthorpe, Dalzell and Clydebridge would be mothballed while one of the two coke ovens at the Scunthorpe steelworks would be closed.

Karl Koehler, chief executive of Tata Steel’s European operations, said: “I realise how distressing this news will be for all those affected. We have looked at all other options before proposing these changes.

“We will work closely with affected employees and their trade union representatives. We will look to redeploy employees, wherever possible, and minimise employee hardship.

“The UK steel industry is struggling for survival in the face of extremely challenging market conditions. This industry has a crucial role to play in rebalancing the UK economy, but we need a fairer system to encourage growth. The European Commission needs to do much more to deal with unfairly traded imports – inaction threatens the future of the entire European steel industry.”

In the past two years, imports of steel plate into Europe have doubled and imports from China have quadrupled, causing steel prices to fall steeply. At the same time, a stronger pound has undermined the competitiveness of the business’s Europe-bound exports, and encouraged more imports.

In response, Tata Steel is concentrating on higher-value markets with a focus on developing stronger and lighter products for its customers.

Bimlendra Jha, executive chairman of the stand-alone Long Products Europe business, said: “Today’s proposals mark the next step in reshaping our business to give it the best chance of survival in this fiercely-competitive global marketplace. We are looking closely at the performance of all parts of Long Products Europe as part of a focus on returning to profitability.”

The consultation process with Tata Steel employees and their trade union representatives begins today.

John Park, assistant general secretary of trade union Community, said: “The significance of this is that it could be the end of steel production in Scotland.

“Tata Steel have to be persuaded to mothball the site rather than close it and the Scottish government has to have a role in keeping the infrastructure secure and supporting short-time work until a future can be secured.”

Last week first minister Nicola Sturgeon said that if the worst happened, she would immediately establish a taskforce to work with the company, the trade unions and local authorities.

Finance secretary John Swinney said workers at the plants were “part of the very deep, skilled tradition of industrial activity within Scotland” and the Scottish Government would work to ensure that every possible option was explored to secure their future.

Prime minister David Cameron has pledged to raise the issue of the “dumping” of cheap steel with Chinese president Xi Jinping, who is in the UK for four days on a state visit, as the crisis in the industry grows.

He told the Commons no subjects were off the table during the visit.