Government in advanced talks over £500m Tata Steel aid package

Published

2 years ago

September 2, 2023

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The government is in advanced talks with Britain’s biggest steel producer to hand over a £500m aid package aimed at securing the long-term future of steelmaking in south Wales.

Sky News can exclusively reveal that Whitehall officials and Tata Steel are close to agreeing a deal that would commit more than £1bn to the future of its Port Talbot steelworks, but which could ultimately result in thousands of job losses.

Sources said this weekend that the terms of an agreement were subject to change, but that there were hopes of finalising it as early as this month.

One insider suggested that Tata Steel had been trying to persuade the government to increase the proposed funding package in recent weeks.

Under the plans currently envisaged, the government would commit approximately £500m of public funding to the company, while Tata Steel’s Indian parent would sign off £700m of capital expenditure over a multi-year period.

Port Talbot employs about 4,000 people – roughly half of Tata Steel’s overall UK workforce of approximately 8,000.

Industry sources close to the discussions said the company had indicated that over the long term, as many as 3,000 of its British-based staff were likely to lose their jobs.

Electric arc furnaces, which Tata Steel would commit to building as part of the agreement with government, utilise different, less labour-intensive, processes to produce steel than traditional blast furnaces.

The government is said to have accepted during the discussions that some job losses would be inevitable as part of the transition to reducing carbon emissions, although an insider said on Saturday that a number of those could be through workers taking early retirement.

The final scope and timing of any redundancies would be negotiated between the company and trade union officials, and sources close to the process insisted that no decisions had been taken.

If a deal can be reached, it would mark the second time this year that the government has bankrolled investment in a manufacturing business owned by Tata Group.

In July, it agreed to commit several hundred million pounds to the company to construct a £4bn battery factory in the UK for its Jaguar Land Rover subsidiary.

Rishi Sunak, the prime minister, described the investment as “a massive vote of confidence” in British industry.

Ministers and Britain’s two biggest steelmakers have been in talks for months about handing over hundreds of millions of pounds of taxpayers’ money to fund the companies’ transition to greener production.

Initially, both Tata Steel and British Steel, its smaller rival, were offered £300m each in government support, but formal agreements have remained elusive.

British Steel’s Chinese owner, Jingye Group, announced hundreds of job losses earlier this year – a move which angered ministers because they coincided with discussions about state funding – but has also yet to reach a deal to secure its plants’ future.

The government originally sought to tie the issue of public funding to a moratorium on redundancies, but it was unclear whether any formal guarantees aimed at limiting job losses would be part of the Tata Steel funding package.

Sources said the offer to Tata Steel had been increased from £300m to about £500m during the course of the summer.

If completed, an agreement with the government would draw a line under years of uncertainty about the medium-term future of Port Talbot, although it was unclear whether the company would make specific commitments about the long-term as part of a deal.

As recently as May this year, Tata Steel warned of a “material uncertainty” over the future of its British business, citing a lack of clarity about potential government support among the factors raising doubts over its prospects.

In an interview with the Financial Times in July last year, Natarajan Chandrasekaran, the Tata Group chairman, said: “A transition to a greener steel plant is the intention that we have . . . But this is only possible with financial help from the government.

“We have been in discussions over the last two years and we should come to an agreement within 12 months.

“Without this, we will have to look at closures of sites.”

In 2020, the Treasury hired bankers and management consultants to draw up a blueprint for the future of the steel industry and advise on talks with Tata Steel about the future of Port Talbot.

During the pandemic, the company floated a plan that would have entailed the government injecting £900m into it in return for an equity stake of up to 50%.

There is not thought to be any equity-linked element to the current aid proposal.

Nevertheless, the proposed scale of the taxpayer support for Tata Steel’s UK operations illustrates the acute political sensitivity that continues to accompany the subject of British steelmaking.

With a general election less than 18 months away, and the Conservatives facing a battle to convince voters that it has a plan to restore the economy to sustainable long-term growth, the closure of one of the country’s most important manufacturing sites would be devastating.

In a letter to Jeremy Hunt, the chancellor, in December, Grant Shapps, the then business secretary, and Michael Gove, the levelling-up secretary, argued that retaining sovereignty over steel production was critical to the UK economy.

“Every other G20 nation has maintained domestic steel production and, while we do not think that this should come at any cost, we do believe it is in HMG’s interest to offer well-designed and targeted funding which unlocks private investment, achieves a good outcome for taxpayers, and enables transformed , decarbonised and viable domestic steel production to continue in the UK in the long-term,” Mr Shapps and Mr Gove wrote.

“We do not want to become reliant on steel sources elsewhere in the same way that energy security has become self-evidently important.

Figures from UK Steel, the industry body, revealed earlier this year that crude steel production in 2022 had fallen to 6m tonnes, its lowest level of output since the Great Depression of the 1930s.

A Tata Steel spokesman said in a statement issued to Sky News: “Tata Steel is continuing to discuss with the UK government a framework for continuity and decarbonisation of steelmaking in the UK amidst very challenging underlying business conditions, given that several of its heavy-end assets are approaching the end of life.”

“Given the financially constrained position of our UK business, such significant change is only possible with government investment and support, as also seen in other steelmaking countries in Europe where governments are actively supporting companies in de-carbonisation initiatives

The Treasury referred an enquiry from Sky News to the Department for Business and Trade, which has been contacted for comment.

UK

Rival groups face off outside migrant hotel – as asylum seekers ‘blow kisses’ at protesters

Published

5 hours ago

August 2, 2025

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Rival groups face off outside migrant hotel - as asylum seekers 'blow kisses' at protesters

Several demonstrators have been detained after rival groups faced off over a hotel accommodating asylum seekers in north London, with police breaking up brief clashes.

The Metropolitan Police has since imposed conditions on the protest and counter-protest outside the Thistle City Barbican Hotel in Islington.

The protest was organised by local residents under the banner “Thistle Barbican needs to go – locals say no”.

The group of several hundred people waved union flags and banners, and one man chanted: “Get these scum off our streets.”

A larger group staged a counter demonstration to voice support for asylum seekers, bearing a banner that read: “Refugees are welcome.”

People inside the hotel, believed to be migrants, watched on, with some waving and blowing kisses from the windows.

A man wearing an England football shirt was detained by police after getting into an altercation with officers.

There have been nine arrests so far, seven of which were for breaching conditions police put on the protests under the Public Order Act.

Rival groups separated by police

Another protest was scheduled in Newcastle on Saturday, outside The New Bridge Hotel, as anti-migrant sentiment ripples through some communities around the country, also flaring up recently in Epping.

The counter-protest in London was organised by local branches of Stand Up To Racism, and supported by former Labour leader and Islington North MP Jeremy Corbyn.

Other community groups including Finsbury Park Mosque and Islington Labour Party were also involved.

Groups online that backed the original protest include “Patriots of Britain” and “Together for the Children”.

At one point, a large group of masked protesters dressed in black, calling themselves anti-fascists, appeared from a side street and marched towards the rival group outside the hotel.

The two groups briefly clashed before police rushed in to separate them.

Why are asylum hotels used?

The government is legally required to provide accommodation and subsistence to destitute asylum seekers while their claims are being decided, most of whom are prohibited from working.

A jump in the use of hotels since 2020 has been attributed to the impacts of the COVID pandemic, a backlog in unresolved asylum cases, and an increase in the number of migrants crossing the Channel in small boats.

However, the number of asylum seekers living in hotels has fallen recently, from 38,079 at the end of 2024 to 32,345 at the end of March 2025, according to the Refugee Council.

How police tried to keep groups apart

The police imposed conditions on both groups in London to prevent “serious disorder” and minimise disruption to the community.

Those in the anti-asylum hotel protest were told to remain within King Charles Square, and to gather not before 1pm and wrap up by 4pm.

Those in the counter-protest were to required to stay in an area in Lever Street, and assemble only between 12pm and 4pm, but were still in eye and ear shot of the other group.

Chief Superintendent Clair Haynes, in charge of the policing operation, said: “We have been in discussions with the organisers of both protests in recent days, building on the ongoing engagement between local officers, community groups and partners.

“We understand that there are strongly held views on all sides.

“Our officers will police without fear or favour, ensuring those exercising their right to protest can do so safely, but intervening at the first sign of actions that cross the line into criminality.”

Meanwhile, the protest in Newcastle was promoted by online posts saying it was “for our children, for our future”.

The “stop the far right and fascists in Newcastle” counter-protest was organised by Stand Up To Racism at the nearby Laing Art Gallery.

UK

Jon Ruben remanded into custody on child cruelty charges after children fell ill at summer camp

Published

11 hours ago

August 2, 2025

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Jon Ruben remanded into custody on child cruelty charges after children fell ill at summer camp

A man has been remanded into custody charged with child cruelty offences after allegedly lacing sweets with sedatives.

Jon Ruben, 76, of Ruddington, Nottinghamshire, appeared at Leicester Magistrates’ Court on Saturday after youngsters fell ill at a summer camp in Stathern, Leicestershire.

He has been charged with three counts of wilfully assaulting, ill-treating, neglecting, abandoning or exposing children in a manner likely to cause them unnecessary suffering or injury to health.

The charges relate to three boys at the camp between 25-29 July.

Ruben spoke only to confirm his name, age and address.

Police received a report of children feeling unwell at a camp being held at Stathern Lodge, near Melton in Leicestershire, last Sunday.

Officers said paramedics attended the scene and eight boys – aged between eight and 11 – were taken to hospital as a precaution, as was an adult. They have since been discharged.

Police said the “owners and operators of Stathern Lodge are independent from those people who use or hire the lodge and are not connected to the incident”.

Leicestershire Police has referred itself to the Independent Office for Police Conduct, after officers initially reported the incident as having happened on Monday, only to later amend it to Sunday.

It is still unclear when officers responded and whether that is why the watchdog referral has been made.

Ruben will next appear at Leicester Crown Court on 29 August.

UK

‘This shouldn’t have happened’: Bishop who interrupted church choir in dressing gown apologises

Published

21 hours ago

August 2, 2025

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'This shouldn't have happened': Bishop who interrupted church choir in dressing gown apologises

A bishop who interrupted a church concert in his dressing gown – and told singers to “leave his house” – has formally apologised to the choir.

Jonathan Baker was filmed standing barefoot at a microphone as he criticised performers for making a “terrible racket” at St Andrew’s Church in central London.

Addressing the City Academy Voices choir directly, the bishop of Fulham said: “I write to apologise for the distress and offence I caused in bringing the concert to a premature end.

“This should not have happened … I also apologise for remarks which were made in haste, and which have understandably caused hurt and distress.”

Mr Baker had demanded for the performance to stop because it was 10pm – and says he didn’t realise the choir had booked the church until 11pm.

In the statement obtained by Sky News, he added: “I have lived here on site at St Andrew’s for 10 years, for much of which City Academy has rehearsed and performed here.

“You have been, and continue to be, welcome – and I hope that you will be able to continue the relationship with us.

“I can give you every assurance that the events of Friday evening will not recur, and I apologise again to performers (especially those unable to perform at the end of the evening) and the audience alike.”

The choir was performing to a 300-strong audience in Holborn when the lights were suddenly turned off, with Mr Baker declaring the concert was “over”.

A church employee then asked the crowd to leave quietly and for the musicians to step down from the stage, attracting boos from the audience.

The choir went on to perform one last song, an A cappella version of ABBA’s Dancing Queen, before bringing their show to a close.

One member of the audience, who was attending with his 10-year-old daughter, told Sky News he initially thought the interruption was a staged joke.

Benedict Collins had told Sky News: “This work deserves respect, not to be disparaged as a ‘terrible racket’. The people here had put their heart and soul into it.

“The bishop cut them off in midstream, preventing soloists who had worked their hardest from singing – and preventing the audience, which included people of all ages, from enjoying it to the end.”

The choir told Sky News it was “upsetting” that they were unable to finish their show as planned, but “hold no hard feelings and wish the bishop well”.

A spokesperson added: “If anyone is thinking of joining one of our choirs, the City Academy Voices rehearse on Mondays in central London. Dressing gowns optional.”