UK business secretary calls on Tata not to close Teesside plant

Wednesday, 23 December 2009 13:58:44 (GMT+2)

UK business secretary Peter Mandelson, who is on a six-day visit to India, has voiced his "disappointment" regarding Indian steelmaker Tata Group's decision to shut down Teesside Cast Products (TCP) site in Redcar, northeast England, which will cause a loss of 1,700 jobs in the region.

Speaking to the Indian media on December 22, Lord Mandelson called on Tata Group to reconsider its decision to close the UK-based plant, noting that alternative uses can be found for the plant. The company should be "very firmly in touch with" the British government as it carries a joint duty to look after the plant's workforce, he added.

Meanwhile, the region's MPs are also rallying to save the jobs at TCP. Local MP Ashok Kumar, spokesman for the group of MPs, has urged British Prime Minister Gordon Brown to hold a "steel summit" with the heads of Tata Group and Corus, in a last-ditch attempt to save the plant.

Kirby Adams, chief executive of Tata Steel Europe, had said following the announcement of the closure that the UK was failing to support its manufacturers and expressed deep concern that the country's industrial base was withering away.

The decision to mothball TCP follows efforts by Corus over the past eight months to secure a long-term future for the plant after the failure of four international slab buyers to fulfil their obligations under a 10-year contract that they signed with Corus in 2004.  This contract committed the consortium in question to buying about 80 percent of the plant's production for ten years.

The global financial crisis caused a huge decrease in production at Corus, the Anglo-Dutch steelmaker, which was bought by Tata Steel in 2007. Tata Group has found it difficult to run a 3 million mt capacity steel plant without any customers or a long-term strategic partner, the company has stated at various times.

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