Against steel subsidies

sir – The Government must not allow itself to be blackmailed into providing Tata Steel with more subsidies (report, March 2).

We learnt a long time ago that subsidies simply distort the market while breeding a culture of dependency. We do, however, know that Britain is an expensive place to make steel, which from a strategic point of view is a vital raw material for many industries. There must, therefore, be a plan to sustain the industry in the long term.

The Government should instead reduce the costs facing Tata and other steel makers, so that it becomes far more attractive to be manufacturing iron and steel in Britain. Remove employer’s National Insurance in full for 10 years, tapering back to the prevailing level over a further five years, with a full dispensation from business rates and zero corporation tax for 25 years.

A move of this sort would encourage long-term investment, rather than subsidy chasing, while allowing the industry to compete directly with imports. It would have little upfront cost for the Exchequer, but would help to create a sustainable industry with positive impacts all the way through the supply chain.

Alastair Macmillan

Port Glasgow, Renfrewshire