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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.

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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.

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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.

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Feeble and inept – prison release fiasco is yet another political crisis

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Feeble and inept - prison release fiasco is yet another political crisis

The charitable view of the latest prison release blunder that has plunged the government into another political crisis is that it’s extremely bad luck rather than an act of incompetence by ministers. 

But the more we learn about the shocking details of what happened and what looks like a cynical attempt at a cover-up by the hapless David Lammy, the more the blame can be laid at the government’s door.

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Critics of the justice secretary and deputy prime minister, standing in for Sir Keir Starmer at PMQs, claim this sorry episode reveals his pomposity, inability to think on his feet and a tendency to blame others for a fiasco.

And it’s not as if the accidental prison releases that have shocked the nation and outraged public opinion in recent weeks are the only fiascos on the government’s watch. For example:

The asylum seeker deported on the government’s one in, one out deal with France who then returned to the UK on a small boat across the Channel was another case of a policy that critics claim isn’t working.

The furore over the tax rises expected in Rachel Reeves’ budget can be attributed to what now looks like a strategic error in promising no rises in income, VAT or national insurance in Labour’s election manifesto.

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The chancellor’s failure to apply for a local authority licence to rent out her home in London’s leafy suburbs revealed a lack of judgment on her part, on top of her dodgy CV about her jobs before becoming an MP.

Angela Rayner’s careless approach to stamp duty requirements on her luxury beachfront flat that forced her resignation triggered a botched reshuffle that caused resentment among ministers and MPs.

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Lammy refuses to say if more prisoners mistakenly released

The appointment of Peter Mandelson as US ambassador – described by ministers as “a risk worth taking” – despite his links to paedophile Jeffrey Epstein, always looked like an accident waiting to happen.

The list goes on.

But Mr Lammy’s handling of the Wandsworth prison releases (another was revealed hours after PMQs) has been chaotic, shifty and made a bad situation worse. It couldn’t have come at a worse time, of course, when he was deputising at PMQs.

We now know that he was told about the release blunder overnight. His excuse for dodging James Cartlidge’s questions in PMQs about another release was that information was still emerging and the case was complicated.

Feeble! And inept.

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A tougher law and order minister in the mould of David Blunkett, John Reid, Michael Howard or – dare one say – his predecessor as justice secretary, Shabana Mahmood – would have demanded the full facts on his desk first thing in the morning.

Was Mr Lammy guilty of a deliberate cover-up or was he just incompetent, with no grip over his department and the increasingly accident-prone prison service? Either is bad and damaging for the government’s credibility.

We also know that the Conservatives found out about the mistaken release 15 minutes before PMQs. Tory stand-in Mr Cartlidge doggedly asked him no fewer than five times if there had been any more accidental releases.

Mr Lammy floundered and, in what was a very bad look, lost his temper. That was a bad mistake. His tactics backfired spectacularly.

When Mr Cartlidge rose at the end of PMQs and told MPs another prisoner had indeed been mistakenly released, Mr Lammy fled the chamber in indecent haste, ignoring the Speaker’s offer of a response.

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Analysis: Did Lammy walk into a trap?

It was, or course, Angela Rayner’s resignation over her stamp duty blunder that brought about Mr Lammy’s elevation to deputy prime minister. And that, of course, was a sop to compensate him for losing the Foreign Office brief.

His critics claim Mr Lammy was over-promoted when he was appointed shadow foreign secretary. But then he did co-chair Sir Keir’s 2020 leadership campaign. And, like the PM, he’s a barrister.

Elected MP for Tottenham in a by-election in 2000, he held a number of junior and middle-ranking ministerial posts under Tony Blair and Gordon Brown.

And in a humiliating appearance on TV’s Celebrity Mastermind in 2009, he said in one answer during a general knowledge round that Henry VII acceded the English throne after the death of Henry VIII.

But the minister now dubbed “Calamity Lammy” by his Tory opponent Robert Jenrick isn’t the only minister guilty of blunders. Top of that list must be the prime minister himself.

Sir Keir makes the appointments, controls policy from No 10, overrules ministers and – when it comes to the economy – is, after all, the First Lord of the Treasury.

Yes, some of the government’s political problems are down to bad luck. But not all, by any means.

To misquote Oscar Wilde, the most famous prisoner held in another prison, Reading Gaol: “To lose one prisoner may be regarded as a misfortune. To lose two looks like carelessness.”

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Maccabi boss hits out at ‘blatant falsehoods’ peddled about their fans – but admits work to do on racism

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Maccabi boss hits out at 'blatant falsehoods' peddled about their fans - but admits work to do on racism

The chief executive of Israeli football team Maccabi Tel Aviv has denounced “falsehoods” and hatred being spewed about their supporters, leading to them being banned from Aston Villa, while accepting there is work to do to eradicate racism in the fan base.

Jack Angelides told Sky News there is a need for “toning down the incitement” ahead of tomorrow’s Europa League match at Villa Park, which will see more than 700 police officers deployed with protests anticipated outside by Palestinian and Israeli groups.

Mr Angelides revealed the club has not been given a specific reason for Birmingham authorities banning their supporters – a decision which the government pushed to be overturned before Maccabi said they would reject any fan allocation granted in any case.

“We feared for the safety of our fans and it’s a huge responsibility,” Mr Angelides said in an interview at Villa Park.

“[With] a lot of incitement, we didn’t feel comfortable in taking that allocation and that’s a sad day in football because things like that shouldn’t happen.

“People have the right to freedom of speech, absolutely, but people don’t have the right to spew hatred.”

Birmingham’s Safety Advisory Group (SAG) announced last month that visiting fans will be barred from attending the game at Villa Park amid public safety concerns.

West Midlands Police also classified the Europa League match “high risk” and said the ban was necessary due to “current intelligence and previous incidents”.

That was a reference to Maccabi’s match at Ajax last November when their fans were attacked by locals, leading to five convictions.

No Maccabi fans were prosecuted. They were seen tearing down Palestinian flags and chanting anti-Arab abuse.

'I've seen people coming up with all sorts of stories about our fans' - Jack Angelides
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‘I’ve seen people coming up with all sorts of stories about our fans’ – Jack Angelides

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Mr Angelides said: “We have not been given a clear reason [for the ban], but I have seen people coming up with all sorts of stories of our fans, especially in Amsterdam, where there was, what the Amsterdam authorities themselves classified as ‘a Jew hunt’, being portrayed as organised fighters, soldiers, etc, etc.

“It’s just blatant falsehoods, and people who say those things know that they’re false and shame on them.”

Pro-Palestinian supporters protest ahead of Aston Villa's UEFA Europa League match. Pic: Reuters
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Pro-Palestinian supporters protest ahead of Aston Villa’s UEFA Europa League match. Pic: Reuters

Mr Angelides believes the decision has been kept private to leave open for people to form a conclusion and characterise his club as racist.

Ayoub Khan, the independent pro-Gaza MP whose constituency covers Villa Park, called for the ban because the club has “hooligans who have a long history of violence and vile racism”.

“Any club that tries to suggest that they don’t have any issues, whatever that may be, it’s untrue,” Mr Angelides said.

“We know we’ve got a long road ahead. There are elements in the club that are not in line with our values, our morals, and we do expend a lot of energy and have been for many, many years in trying to… eradicate that.

“But to malign thousands and thousands of good fans with the actions of a few, it’s a dangerous game because I think that’s something that is not conducive to toning down the incitement that’s actually going on now. It’s manipulation to my mind.”

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Maccabi Tel Aviv FC ruled it wouldn’t sell fans any tickets

Football focus

Mr Angelides did not discuss whether there was fear among the players going into a potentially hostile environment.

“We have Jewish players; we have Christian players; we have Muslim players – we’re a club that’s quite diverse,” he said.

“There is an understandable excitement of playing. They’re aware, … the last two years have taken a toll on Israeli society because of what’s been going on. So they’re very aware of the situation, but I think they’re prepared to focus on their football.”

The game is going ahead, after moves in European football to ban Israeli teams over the war in Gaza faded, as a peace deal was implemented.

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‘I’m desperately sorry’: Axel Rudakubana’s father accepts ‘share of the responsibility’ after Southport attack

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'I'm desperately sorry': Axel Rudakubana's father accepts 'share of the responsibility' after Southport attack

Axel Rudakubana’s father has said he is “desperately sorry” for failing to challenge his son’s violent behaviour over the years before the Southport attack.

Alphonse Rudakubana told a public inquiry he was “frightened” of his son, who once poured a bottle of oil over him and said: “Trust me, I will kill you.”

He said Axel’s behaviour deteriorated in a “short period of time” until he was expelled from the Range High School in Formby, Merseyside, in October 2019 after admitting to carrying knives.

Two months later, he returned to attack a pupil with a hockey stick, while armed with a knife and was arrested and made subject to a referral order, aged 13.

Tributes left near the scene of the attack. File pic: PA
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Tributes left near the scene of the attack. File pic: PA

Alphonse said his son would have “random” violent outbursts, attacking him up to twice a day, but he became “conditioned to his behaviour” and “allowed him to abuse and assault me”.

“I’m ashamed of my response,” he said, adding his fear “prevented him from doing things a parent would normally do”, such as restricting internet activity and ordering weapons online.

“This had catastrophic consequences for which I’m desperately sorry,” he said.

“I accept I bear my share of the responsibility and that by not challenging his behaviour he was allowed to acquire dangerous weapons and view inappropriate content online.”

He said he and his wife Laetitia Muzayire “couldn’t set boundaries, we couldn’t say anything because it would lead to outbursts, and he was effectively out of control”. He also said he feared his son would be taken away.

Three children were killed in the attack last year. Pic: PA
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Three children were killed in the attack last year. Pic: PA

Axel was referred three times to the government’s anti-terror programme Prevent between 2019 and 2021 because of concerns over his fixation with violence, including school shootings.

The criminal investigation showed he had images of mutilated bodies, torture, cartoons mocking Islam, antisemitic material, Nazi mass graves and material demeaning to women and girls, on his devices.

His father told the inquiry he was not aware of the material but admitted: “I had lost control, I had no authority as a father.”

“I was reduced to somebody who feeds him, does all he asks,” he said, adding: “I had no power to stop him from accessing anything he wanted online.”

The inquiry heard Axel received a delivery of a machete in June 2023 but his father said he didn’t confront him “because he would fly into a rage”.

Flowers and tributes to the victims. File pic: PA
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Flowers and tributes to the victims. File pic: PA

Knife packaging found in washing machine after Rudakubana left home

His brother Dion said Axel would order packages online with money he made through his genealogy business which he feared “had something bad in them”.

He told the inquiry the last time his brother left home alone before the Southport attack was when he was caught carrying a knife on a bus in March 2022, telling police he was “going out to stab someone to get rid of his social media accounts”.

Dion said it would have seemed “logical” to Axel, adding: “It wouldn’t have been anyone specific, just a random person.”

A week before the mass stabbing, armed with a knife, Axel booked a taxi to his old school and tried to get in, but was stopped by his father.

(L-R) Bebe King, Elsie Dot Stancombe and Alice da Silva Aguiar. Pic: Merseyside Police
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(L-R) Bebe King, Elsie Dot Stancombe and Alice da Silva Aguiar. Pic: Merseyside Police

Axel Rudakubana, was aged 17 when he murdered Elsie Dot Stancombe, seven, Bebe King, six, and Alice da Silva Aguiar, nine, in a knife attack on a Taylor Swift-themed dance class on 29 July last year.

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Eight other children, who cannot be identified because of their age, were also injured, along with yoga instructor Leanne Lucas, who was leading the dance class, and businessman John Hayes, who was one of the first people on the scene and tackled the killer.

Dion described the moment his brother left the family home that morning wearing a face mask and with the sleeves of his hoodie pulled down.

He told the inquiry how his mother showed him the knife packaging she found in the washing machine shortly after.

But his parents “didn’t seem alarmed” and his mother went back to bed so he took “comfort” from this and there was “no discussion about contacting the police”.

“We did not believe he intended to harm anyone” and thought if he was carrying a knife it was to “protect himself, not to harm others”, Dion said.

Asked about why Axel may have targeted the Taylor Swift-themed dance class, Dion suggested because “children are very valuable to society” and it would “hurt society very badly” if children were to be harmed.

The inquiry, which is being held at Liverpool Town Hall, continues on Thursday.

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