MEPs and leading industry figures slam UK government handling of steel crisis

Steel industry closures cloud state visit of Chinese President Xi Jinping to UK.

By William Louch

21 Oct 2015

Senior industry figures and UK Labour MEPs have strongly criticised the government's handling of the crisis currently facing the EU steel industry. They have called on UK Prime Minister, David Cameron, to raise the issue with Chinese President Xi Jinping during his state visit this week.

The EU is the second largest producer of steel in the world after China, accounting for 11 per cent of global output.

However, the steel sector has been strongly affected by a combination of high energy prices, falling demand and competition from low-cost exports from China. The situation is predicted to worsen if China is granted market economy status leading to a relaxation of trade rules.


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In recent weeks the British steel industry has seen Sahaviriya Steel Industries in Redcar with 2200 jobs lost; Caparo Industries go into administration threatening a further 1700 jobs and over 900 job losses at the Tata steel works in Scunthorpe. Tata has previously cut production at its sites in Newport, Port Talbot and Rotherham with a combined loss of 1000 jobs.

Following the recent closures, Linda McAvan, Labour MEP for Yorkshire and Humber, said, "The fate of the British steel industry must be a priority for David Cameron in light of the talks with Chinese President Xi Jinping later today. He must strongly back EU anti-dumping measures so that our steel industry can compete on a level playing field."

Her colleague, Richard Corbett added, "The government must do everything it can to support local communities. But it has already ruled out seeking the available help from the EU Globalisation Adjustment Fund (EGF). The government could apply for up to €6.81m, but so far is refusing to act."

The UK government's management of the issue has also been criticised by leading figures in the steel industry.

Gareth Stace, director of industry body UK Steel, said: "This is another shattering blow for the sector. It’s now a question of how many more plants and jobs will be lost before the Government takes the actions that it committed to at last week’s steel summit."

Tony Burke, general secretary of the UK's largest trade union, Unite, said, "Ministers need to ask themselves how many more steel firms need to go to the wall before they step in. Failure to act could lead to a 'domino effect' taking hold across the industry."

The European Commission has listed boosting the steel industry as a priority, identifying steel as playing a key strategic role in the EU economy, driving innovation, growth and employment.

To help the steel industry remain competitive, the Commission adopted an Action Plan on the competitiveness of the sector in 2013.

In addition, industry can access various EU funds such as Horizon 2020 and the Research Fund for Coal and Steel to ensure it remains competitive in the future.  

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