We were told the government was "committed to working with Tata and the unions on a long-term sustainable future for British steel-making.” We were told that no decision and no response to the news that Tata Steel was looking to sell its UK sites was being ruled out. We were told wrong. The government now seems hell-bent on seeing the demise of another British industry. There is an economic as well as moral case for the survival of an industry that has the potential to be successful again. And the answer lies with nationalisation.
Nationalisation – the only government action ruled out by David Cameron – could be the saviour to an industry with a rich heritage spanning over a century on the Welsh site, supporting generations of workers and countless communities. Over 40,000 people work at the site or in the immediate supply chain, and every one of those jobs is at risk from the uncertainty caused by this week’s announcement. Most concerning is the fact that workers with years of experience (who are highly skilled) will be forced to walk away from the industry. Claims workers will need to “re-skill” disguise the fact that they represent the best of blue-collar industry. “Re-skill” is code for “downgrade” to low skill and low wage jobs.
At the same time, for those young people looking to pursue opportunities outside of university or the service sector, who wish to restore the mantle of British manufacturing, they will lose another outlay and another industry to seek work in. It is all good claiming that more apprenticeships than ever have been created, but useless if those young adults don’t have anywhere to work at the end of it.
Nonetheless, the Port Talbot debate runs much deeper than the moral and human responsibility government has. There are economic arguments involved, and we must face the fact that Port Talbot is losing £1 million a day. But where the market has jolted, that does not represent absolute failure. Port Talbot has been successful in the past, and can be again with the right investment. Destroying a national industry because another country is able to temporarily undercut you is not competitive and not good economics, as total power over the value of the goods traded are inevitably handed over to a single corporation, which then dominates.
Instead, the money must be made available to allow British steel to compete and ride the current storm of high energy prices and international dumping. Worryingly, the destruction of British steel will destroy any opportunity to meet domestic demand with domestic supply at a time when industries like defence continue to make steel orders (in Britain) for their ships, aircraft carriers and submarines. For growth in the future, we need nationalisation today.
Practically, the government could buy the Tata site for £1, restructure existing debt, wage and pension issues, and invest in the plant for the future. As with Rolls Royce and Network Rail, the government could turn a suffering industry into a profitable industry; with the option of turning it in to a mutual when looking for investment outside of central government. Sadly, the government has already dismissed the one option that will save the industry, sticking to the ideological mantra that nationalisation disturbs market forces. If steel workers have been betrayed by Tata, then they’ve been betrayed by their government too. It’s time for nationalisation.