COVID-19: Welsh chief pushes UK government for Tata Steel rescue

The First Minister of Wales has urged the UK government to step in to help Indian steel major Tata Steel to keep its Port Talbot site, UK's largest steelworks, and other operations in the region afloat and save thousands of jobs amid the coronavirus crisis.

Tata Steel employs around 8,385 people in the UK, including about 4,000 people in Port Talbot and 2,800 in other parts of Wales.

Mark Drakeford said that the devolved Welsh government alone cannot support Tata Steel to the level it needs, an estimated 500 million pounds.

He stressed that while the local government can look into some targeted support, the scale of the rescue is beyond its scope.

"If they are very specific and local things that need to be done at Welsh-based sites, that are to do with those sites and things that happen in Wales, then we continue to talk to companies about help that we could provide," Drakeford said at a press conference this week.

"But a GBP 500 million investment in the industry is beyond anything the Welsh government could muster and that is because the problems that the GBP 500 million seeks to address are not Welsh-specific problems. They are to do with the global crisis facing the industry," he said.

It emerged over the weekend that the Indian steel major is in talks with the UK authorities for a financial package to survive through the lockdown period.

"We continue to work with both the UK and Welsh governments to identify what support is available," a company statement said.

The support sought is largely understood to comprise a commercial loan that would be repayable when demand for steel recovers.

Drakeford said the Welsh government had been in talks with Tata Steel and it was clear the Port Talbot site, the UK's largest steelworks, is important to all parties.

"We were there with practical help in 2016 when there was a crisis in steel production. But the scale of the global challenge to steel makers everywhere means the UK government has to step into this space. There are things that will need to be done locally but the global nature means that local solutions themselves will not be sufficient," Drakeford said.

Local MP Stephen Kinnock has also been lobbying the government to support the Indian steel major through the crisis and save jobs.

"Tata Steel is facing a temporary cashflow shortfall due to the massive disruption that has been caused by COVID-19, and needs a bridging loan to get it through this challenging time," the Opposition Labour MP told 'Wales Online'.

"The government's loan scheme for large firms is welcome in principle but it is capped at GBP 50 million, which is only around 10 per cent of what Tata needs. Everyone who cares about the future of British manufacturing must therefore urge the UK government to lift the loan cap so that Tata Steel can ride out this storm and bounce back," he said.

The UK government said it had put together a "far-reaching package" of support for all businesses through the coronavirus pandemic, and will continue to "regularly engage with businesses across all sectors, including those in the steel industry".