We’ll help steelworkers on pensions, hints Javid

THE state will take control of Tata’s pension liabilities of up to £2 billion in a bid to save Britain’s beleaguered steel industry, Sajid Javid suggested yesterday.

The Business Secretary said the Government was ready to step in with financial support to persuade investors to buy the threatened steelworks at Port Talbot and other stricken plants.

He signalled that ministers were working on sweeteners such as reducing energy costs and perhaps even running Tata’s pension fund, which has 134,000 members.

But Labour renewed calls for Mr Javid’s resignation after he admitted that he had been aware that Tata Steel’s bosses were meeting last week in Mumbai to discuss the future of its UK operations but chose to go ahead with a trade trip to Australia anyway. He told the BBC’s Andrew Marr Show that he had known that a sell-off was on the cards, but claimed he did not know that Tata’s owners were going to make such a stark announcement, pulling out of the UK altogether and putting the jobs of up to 40,000 British workers at risk.

Over the weekend, Mr Javid sought to regain the initiative by telling the NHS, town halls and schools to buy more British steel. But even this policy was undermined when it emerged that, over the past five years, the public sector had been using cheaper steel from abroad thanks in part to an order from David Cameron that value for money concerns were paramount in public sector procurement.

Mr Javid acknowledged that the Government would have to come forward with some financial assistance if there was to be a deal.

‘Tata will issue an offer document very soon,’ he said. ‘The UK Government know – I’ve known for a while – that we’re also going to have to offer support to clinch that buyer and give that steel plant a long-term, viable future. I do feel, though, for lots of reasons after talking to Tata and many others involved in this, that there will be enough time to find the right buyer working with the Government.’

While he did not believe that nationalisation was a solution, he insisted he was ruling nothing out.

But he said that the high energy costs compared with the business’s European competitors and its reported £2 billion pension liabilities – dating to the days of British Steel – would have to be addressed in any deal. ‘This is a long-running pension scheme,’ Mr Javid said. ‘It’s an expensive scheme, the way it was originally set up, and it’s hugely important to retired workers, to current workers, and we recognise that – so we don’t want to do anything that would jeopardise them and what they expect from it.

‘It is an issue and we’ve been looking at it and I recognise it’s one of these [issues] that we need to work on with a potential buyer.’

It is not clear whether the pension fund option would cost taxpayers money. Experts said it could end up under the control of the state-run Pension Protection Fund, which is financed through a levy on other businesses’ pension funds.

Mr Javid’s comments came as tycoon Sanjeev Gupta, whose commodities firm Liberty House has already saved a number of UK steelworks, was planning talks about a rescue of Port Talbot. ‘ We would need a proper partnership with the Government,’ he told the Sunday Telegraph. ‘I don’t know what that would entail at this stage.’ ÷Brothers Marc and Nathaniel Meyohas, who run investment firm Greybull, were last night said to be finalising plans to buy Tata’s Scunthorpe works, the Daily Telegraph reported. The deal could pave the way for a move for the Port Talbot plant, it was claimed.

Dominic Lawson: Page 14