(qlmbusinessnews.com via news.sky.com– Mon, 12 Dec 2023) London, Uk – –
British Steel has revealed it is to cut 260 jobs, almost 7% of its workforce, despite continuing government funding talks with its Chinese owners.
It was announced that the losses would be felt at its Scunthorpe plant through the closure of its coking ovens – used to turn coal into the high-temperature product needed to service its blast furnaces.
The move was revealed after Sky News reported that officials from the Department for Business and Trade were due in China to meet executives from Jingye Group amid protracted talks about a £300m grant.
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Sources said the talks were expected to focus on the value of an energy subsidy package, which could take the overall value of government support for British Steel to approximately £1bn.
The prospect of additional taxpayers' cash had been dependent on job guarantees.
Sky's City editor Mark Kleinman reported last month that Jingye was drawing up plans to cut around 800 jobs at British Steel.
The company placed no timeframe on its proposals but said it had entered talks with unions.
It placed an emphasis on cutting its environmental impact and energy bills.
The company said its costs, on both fronts, rose by a combined £190m last year.
It declared in a statement that “decisive action is required because of the unprecedented rise in operating costs, surging inflation and the need to improve environmental performance.”
British Steel chief executive, Xifeng Han, said: “Steel is vital to modern economies and with demand expected to grow over the coming decades, British Steel has a crucial role to play in ensuring the UK has its own supply of high-quality steel.
“To make sure we can deliver the steel Britain requires, we're undergoing the biggest transformation in our 130-year history.”
He added: “We have taken action to reduce costs within our control; however, steelmaking in the UK remains uncompetitive when compared to other international steelmakers.
“Our energy costs, carbon costs and labour costs are some of the highest across the world, which are factors that we cannot influence directly.
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“For the reasons outlined, we entered into talks with the UK government in Summer 2022 and are extremely grateful for its support.
“It's important we have the correct policies and frameworks in place to back our drive to become a clean, green and successful company and we're continuing to discuss this with the government.
“We are committed to working together and to making the home-made steel Britain needs for generations to come.”
