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The North East Regional Committee's decision to take evidence on the Steel Industry arose from Corus's and Tata's decision to mothball Teesside Cast Products (TCP) at Redcar and Lackenby by the end of February 2010, a decision put into practice on 19 February.
Evidence was given for Corus by TCP's Managing Director, Jon Bolton. He outlined the fact that demand for slab steel declined exponentially from the autumn of 2008 and through 2009. He did not state that Corus Redcar had no orders for slab. He did make a statement that a wage subsidy would be insufficient to maintain production at Redcar. No explanation of failed partnership agreements was given.
A continual criticism was made of the fact that Mr Kirby Adams, Chief Executive Officer of Tata Steel Europe (Corus's and TCP's parent company), did not attend in person to give evidence to the Committee. He was made the offer that the Committee would meet with him at any time during its inquiry to fit in with his diary. It is disappointing, and unacceptable, that this offer did not receive a positive response. His only response was written, in answer to a list of questions that may be found among the evidence attached to this Report. The Committee was not, as a result, able to question Mr Adams in any detail about why a decision affecting the lives and livelihoods of thousands of people on Teesside had been taken. A similar disrespect was shown to the multi-union committee representing Corus workers, who told us that Mr Adams had attended meetings only briefly in order to make a statement and then leave, without engaging with the workforce or answering legitimate questions.
Evidence produced by Redcar and Cleveland Borough Council and by Tees Valley Unlimited, along with the Joint Trade Union committee and Trades Union Congress, outlined the serious economic devastation that would occur if the TCP plant were mothballed. The number of those made unemployed as a consequence will climb above 4,000.
Tees Valley Unlimited outlined work commissioned by Redcar and Cleveland Borough Council that raised the opportunity of keeping Corus manufacturing slab steel if the Government provided a wage subsidy. This idea was supported by the TUC, who outlined the fact that 22 of the 26 Organisation for Economic Co-operation and Development (OECD) countries have wage subsidies in place for industries in economic difficulty. This evidence ended with a request that Government urgently explore the legality of using a state wage subsidy.
The Joint Trade Union's evidence, led by Community, requested explanations of how, and why, potential buyers had failed to achieve a working partnership agreement with Tata. They made reference to the fact that the mothballing of TCP would lead to a serious decrease in demand for highly skilled and general worker operatives. They made the case that mothballing the plant would require the retention of upwards of 400 highly skilled employees if the plant were to be maintained for operational use.
Redcar and Cleveland Borough Council and the Mayor of Middlesbrough made reference to the facts that world steel prices are rising and that the North East Region's economic development is changing to carbon capture and renewable industries, such as, off-shore wind farms. Thus, a future demand for steel is inevitable.
The Regional Development Agency played a central role in securing £60 million in aid for the North East in the wake of Corus and Tata's decision to mothball the Redcar facilities. It will also be central in funding and organising work to enable those who lose their jobs at TCP, and in the wider local and regional economy, to seek alternative employment.
The Minister for the Region, Rt Hon. Nick Brown MP, said that the Government would continue to explore means of returning the plant to production.
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