Tata Steel to cut 900 jobs in UK

Nov 23 2012, 19:40 IST
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Tata Steel to cut 900 jobs in UK. (Reuters) Tata Steel to cut 900 jobs in UK. (Reuters)
SummaryRatan Rata-led Tata Steel said it will cut jobs as part of major restructuring of European ops.

Ratan Rata-led Tata Steel today said it will cut 900 jobs in the UK as part of major restructuring of European operations to make the company an "all-weather" steel producer, capable of succeeding in difficult economic conditions.

"The proposed changes are expected to lead to a net loss of 900 jobs in the UK, including 580 in South Wales, 155 in Yorkshire, 120 in the West Midlands and 30 in Teesside," the steel giant said.

The company is proposing to make changes at a number of steel finishing and processing sites in the UK, Tata Steel said in a statement.

CEO of Tata Steel's European operations, Karl Kohler said, "Today's proposals are part of a strategy to transform ourselves into an 'all-weather' steel producer, capable of succeeding in difficult economic conditions.

"These restructuring proposals will help make our business more successful and sustainable, but the job losses are regrettable and I know this will be a difficult and unsettling time for the employees and their families affected," he said.

Kohler said the company will be working with its trade unions and government at a national and local level to ensure maximum possible assistance and support to them.

"In addition, our subsidiary UK Steel Enterprise will be looking at how it can provide more support to local steel communities and stimulate new jobs following today's announcement," he added.

Tata Steel also said it will re-start one of the two blast furnaces in Port Talbot, South Wales, being rebuilt as part of 250 million pound investment in the first quarter of 2013.

It will also lead to the restarting of the hot strip mill at the company's Llanwern site in Newport, South Wales.

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The company's proposals include the restructuring of management and administrative functions which would lead to the loss of 500 jobs at Tata Steel's Port Talbot-based production hub in South Wales.

Similar restructuring programmes were initiated last year at the companyŅs other two production hubs.

The company is proposing to make changes at a number of steel finishing and processing sites in the UK that would improve its product and service offering for customers, the statement said.

"These changes would concentrate services at six distribution and processing hubs which would benefit from 22 million pounds of new investment and new employment, but would also lead to the closure of 12 sites, including Tafarnaubach and Cross Keys in South Wales," it added.

In addition, shift levels at the company's Rotherham and Hartlepool operations will be reduced to match production to lower demand for bar products and pipelines.

Kohler said that apart from support to local steel communities through subsidiary UK Steel Enterprise, "we will strengthen this work with a further 650,000 pound to help them create new jobs in affected areas".

UK Steel Enterprise has teams in all the affected locations who, for almost four decades, have helped to regenerate local economies and create 70,000 new jobs in the UK, he said.

"We will do everything we can to reduce the impact of the proposals on employees and, where possible, we will look to achieve job losses through voluntary redundancies," he added.

Michael Leahy, General Secretary of the Community trade union and Chair of the trade unions Steel Committee, said: "We will be seeking an urgent meeting with the company to ensure our principle of no compulsory redundancies is upheld...".

Terming the proposed job losses as "symptomatic of the continuing failure of the Government's economic policy," he said the union has called on the British government to take urgent action to stimulate economic growth and help revive the manufacturing sector.

The announcement follows downturn in the UK and European steel industry, where the fall in UK steel demand has been steeper than in any other major European economy.

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