Tata Steel is to shed up to 1,500 jobs at its loss-making Long Products division in north England as part of what it described as proposed structuring to “target high-value markets and introduce greater flexibility into its costs and operations”.

“This strategy includes a proposal to close or mothball parts of the Scunthorpe plant and puts at risk 1,200 jobs at Scunthorpe and 300 jobs at its Teesside sites,” the company said in a statement on Friday attributing the decision to the “continuing weakness in market conditions” and the “huge additional costs” the steel industry faced because of the European Union's regulatory rules.

Investment

It also announced an investment of 400 million pound sterling in the division over the next five years to help it turn around.

Karl-Ulrich Köhler, Managing Director and CEO of Tata Steel's European operations, said the strategy was decided “only after going through an inclusive consultative process that involved very careful scrutiny of the Long Products business performance”.

“Tata Steel is showing its commitment to making this strategy work by earmarking 400 million pound sterling of investment for this business over the next five years. At the same time we are aware that our employees and their families will experience a very unsettling few months as a result of this announcement. We will do everything we can to provide them with support and assistance”.

Unions described the threatened job losses as a ‘blow'. “We have already demanded that there should be no compulsory redundancies and we believe that this should be possible to achieve,” Paul Reuter, national officer of ‘Unite', Britain's biggest union, told the BBC.

Michael Leahy, General Secretary of Community union and Chair of the Steel Committee, said: “The key now is for the company to engage the local trade unions in consultation on the way forward. We will be seeking an early meeting to explore all possible means of avoiding any compulsory redundancies”.

To invest 400 m pounds in Long Products division to turn it around