After dismissing appeals to nationalise Tata Steel's steel operations in the UK, the government has said that it would consider co-investing with a private sector partner to help keep Port Talbot steel works going. This is the first indication from the government that taxpayers' money could be used to help save the plant.
Business Secretary Sajid Javid told the House of Commons that the government was working very hard to find a buyer for the South Wales plant that has been put up for sale by Tata Steel. One of the options being considered by the government was "the possibility of co-investing with a buyer on commercial terms," he said.
Javid however stressed that the sale process for Port Talbot, Britain's biggest steelworks, had only just started and that all options are being explored. He said the government is ready to invest or provide funds but that it "has to be on commercial terms." Javid added: "I've been in contact with potential buyers, making clear that the government stands ready to help."
He told the House: "Several weeks ago Tata told me in confidence that they were seriously considering an immediate closure of Port Talbot, not a sale, a closure. That would have meant thousands of hard-working men and women could already be out of a job."
Javid continued: "Thousands more would have been facing a very bleak future. I was not prepared to let that happen." He said that the government had intervened and convinced the company to hold out for a buyer.
Weeks before, Javid had admitted to the BBC that he was caught unawares by Tata's announcement that it plans to sell its UK steelworks following a meeting in India which he did not attend as he was on a business trip to Australia. He said that although he had known that Tata Steel was reviewing its UK operations, it had "gone much further than we expected."
Tata Steel directly employs 15,000 workers in the UK and supports thousands of others, across plants in Port Talbot, Rotherham, Corby and Shotton. Thousands of workers in both England and Wales stand to lose their jobs if a buyer cannot be found.
Roy Rickhuss, the general secretary of steelworkers' union Community, said Javid's comments sent "the right signal to potential investors" but said the business minister should explain what he meant. "Mr Javid should bring forward further details of what 'co-investment' would look like and share his plans with the unions so we can ensure that the best interests of steelworkers are upheld," he added.
Sale of Tata's European long products unit
Earlier in the day, the sale of Tata Steel's European long products unit to Greybull was announced. The business was sold to the investment firm for a token £1. As part of the deal, workers are being asked to a accept a pay cut and agree to less generous pension arrangements.
The sale involves the Scunthorpe works, two mills in Teesside, an engineering workshop in Workington, a design consultancy in York, a mill in Hayange, France and sales and distribution facilities. Greybull partner Marc Meyohas said the company has not rule doubt buying other parts of Tata Steel's UK business.