Revealed: 4,000 jobs lost over Port Talbot steel deal

The closure of blast furnaces at Britain’s largest steelworks will lead to far more job losses than previously thought, the Mail reports.

The deal between Tata Steel and the Labour government over the future of Port Talbot will lead to the redundancies of more than 4,000 workers.

That is 1,200 more than the previously announced 2,800.

The true scale of the job losses was hidden in the Indian steel giant’s planning document for its Port Talbot plant.

It comes as Chinese rival British Steel races to agree a bailout package with the government, with 2,500 jobs at risk at its Scunthorpe plant.

Labour last week struck a similar £500m taxpayer-funded deal with Tata Steel to help the company transition to green steelmaking at Port Talbot.

The site’s coal-fired blast furnaces are being replaced with an electric arc furnace in a bid to reach net zero. Tata Steel, which owns the site in South Wales, is investing £750m.

Ministers welcomed the improved deal after months of negotiations with the Mumbai-based company and unions.

But Business Secretary Jonathan Reynolds was criticised for merely amending a deal struck under the Conservative government.

Thousands of jobs remain at risk, with the taxpayer footing the half-billion pound bill. The latest figure takes into account the huge impact of the £1.25 billion redevelopment on the UK supply chain and other businesses. In a planning document, Tata said that “there is likely to be a net reduction of 4,070 full-time equivalent jobs in the UK, of which 2,830 jobs will be lost in Wales”.

Documents show that Tata expects the development to have a “significant” negative socio-economic impact.

The company has already announced that 2,500 jobs will be lost over the next 18 months and that another 300 are at risk within three years.

A Tata Steel spokesman said: ‘The figure of 4,070 jobs at UK level reflects the known potential reduction in Tata Steel UK jobs at the site, the potential reduction in other jobs within the companies’ supply chain and the potential reduction in jobs supported by people who spend their wages in the wider economy on a wide range of goods and services.

‘We are working closely with our suppliers to create contract opportunities during decommissioning and once the electric arc furnace is operational, to minimise potential cuts in the supply chain.’

Redundant workers hired directly by Tata Steel will receive 2.8 weeks’ pay for each year of service, up to a maximum of 25 years. Given that the average salary for a steelworker in Port Talbot is around £40,000, a worker with 25 years of service could receive a payout of almost £54,000.

The minimum redundancy payment is £15,000 for full-time employees, and Tata Steel staff facing redundancy will be offered a year-long paid retraining scheme.

Ministers could demand money back if Tata fails to retain at least 5,000 workers in the UK.

Labour MPs were furious when the deal was announced last October. Reynolds, then shadow economy minister, said at the time:

‘Only the Tories could spend £500 million of taxpayers’ money to lay off thousands of British workers.’

The government secured better redundancy terms for workers and a skills programme for redundant workers. Reynolds said the deal was the best he could have signed in Labor’s two months in power.