#SSI Redcar Plant To Be Fully Closed
The coke ovens and blast furnace at SSI Redcar steel mill are to be closed after no viable offers were received from potential buyers, the Official Receiver said today.
SSI was wound up by the High Court in Manchester on 2 October 2015 at the company’s request.
The Official Receiver, appointed liquidator by the Court, has maintained the site since that time to ensure its safety while discussions with interested parties about purchasing the facility in working order to take place.
The Official Receiver, Ken Beasley, said:
“SSI was placed into liquidation with substantial debts and had no funds available to purchase the coal needed to keep the coking ovens operational. I have ensured the continued operation of the ovens whilst I dealt with health and safety issues and considered whether there were any viable offers for the ovens. There is no realistic prospect of a buyer being found and the priority now is to close the ovens down safely.
“I cannot continue to draw on taxpayers funds to keep the ovens operational when there is no realistic prospect that a buyer will be found.
“I am continuing my liquidation of the company, including talking with interested parties about purchasing the company’s other assets.
“I thank the staff who have been involved in the continued operation of the company and recognise the great efforts that have been put in and the professionalism shown by people in a time of enormous personal pressure.”
The Official Receiver will continue to monitor the number of staff required to safely manage the site in a closure situation.
Unfortunately, staff numbers will decline as the closure plan progresses.
Commenting on the news that the former SSI Steelworks in Redcar will undergo a ‘Hard Closure’ Tom Blenkinsop, Labour MP for Middlesbrough South and East Cleveland and Chair of the All Party Parliamentary Group on Steel said:
“This is devastating news for the 2,200 workers who have lost their jobs, my thoughts go out to those who have lost their jobs and their families. This is a dark day for Teesside and East Cleveland, the repercussions will be felt through the supply chain and the local economy.
“The government have sat on their hands while thousands of people have lost their jobs, there was a viable offer on the table to maintain the coke ovens but the government failed to listen, they just went through the motions. The Government have abandoned Teesside.
“To add further insult to injury, the increased number of redundancies will decrease the already meagre steel aid package, as redundancy payments are included in the £80 million figure. The government must reconsider the £80 million package as thousands more people could lose their jobs with contractors and suppliers.”
"The announcement today of closure of the both the coke ovens and blast furnace at Redcar is an absolute and utter disaster”, says Middlesbrough MP Andy McDonald.
“BIS Minister Sajid Javid’s statement earlier today saying the Government cannot intervene in the liquidation process at the Redcar Steel Plant demonstrates just how incompetent this Government is. This collapse should have been on the Government’s radar a long time ago.”
“All the signs have been there for many months. Principally the dumping of vast quantities of steel by China on the world market and despite slowing growth in China their own steel consumption had failed to keep pace with the growth in production made it abundantly clear that there were major problems ahead. This has been known in the industry for years and has put enormous pressure on the UK steel industry.
“In short, the Government was asleep at the wheel”, said Mr McDonald.
“But now they say they can’t intervene in the liquidation process. This is nonsense. They could have intervened. They simply chose not to because to do otherwise would be to go against their “let the markets decide everything” approach.
“Nowhere in the statement issued earlier today, does Government set out its commitment to the steel industry. It’s not surprising because they clearly have no such commitment.
“They could have directed the liquidator to ensure the coke ovens and power plant continued and they could have ensured that the blast furnace was properly mothballed to permit future igniting. The BIS secretary has that power and he has sat on his hands.
“None of that would have offended against state aid rules. This Government has simply wanted to hide behind state aid as an excuse for doing nothing.
“Redcar Blast furnace is a strategically important national asset and the Government should still at this stage, respond accordingly. If we as a nation don’t produce steel our manufacturing base is completely undermined.
"What ever happened to the “Northern Powerhouse” or the “March of the Makers”?
“As to the pathetic £80m package - no right minded person on Teesside will be fooled by this. For starters it includes statutory redundancy payments that the workers are entitled to at law in any event.
“They should come clean with the figures. If it’s right that the redundancy payments are up to £20m the figure of £80m starts to look even more inadequate to address the needs of the 9,000 families affected.
“As for the misdirecting of pension contributions by SSI, this looks very much like criminal behaviour to me and I call upon the Police and others to investigate.
“The steel workers on Teesside and our communities have been taken for a ride and it’s about time this Government did the right thing by them and for the sake of the country’s industrial future”.
Statement from Councillor Sue Jeffrey, Leader of Redcar and Cleveland Borough Council:
“This is the worst possible news and is an absolutely heart-breaking moment for all of us. Our proud history of years of steelmaking has been torn out from under us. We have been so proud of our heritage and I cannot believe it has slipped away in the space of a few weeks.
“So many people have been affected by the closure – the steelworkers and their families, the supply chain and the wider economic impact this will have on our local area. It is devastating.
“We have already committed to doing everything we possibly can as a council to support the men and women in our communities who have lost their jobs and have had their lives turned upside down.
“The Government has had plenty of opportunities to intervene but it has just allowed this to happen – it should have stepped in sooner to help.
“The £80million package provided is simply not enough, especially as it will also fund the redundancy payments.
“And any decision around the long-term future of the site should have come after the steel summit on Friday. This future of steelmaking in the Tees Valley should have been a focal point of those discussions. What is the point of making this decision prior to those talks?
“We now need to look at if the hard closure takes place as has been indicated, how we look to secure the site for the future and bring it back to contributing towards the economy in Redcar.”
Statement from Chair of the SSI Task Force and Chief Executive of Redcar and Cleveland Borough Council, Amanda Skelton:
“Understandably, today’s announcement is extremely distressing for the SSI workforce, their families, our communities and economy.
“The SSI Task Force members are working hard to support the workforce at this very difficult time. The help that has already been on hand during the last week will continue over the next weeks and months. Rapid employment advice, such as help with job applications and CVs, is already in place. The financial consequences of closure will hit many families hard. That’s why it’s important that we’re also able to give specialist money and benefits advice to everyone affected.”
“A Jobs fair has been organised for this Wednesday and we are expecting participation from up to 30 potential employers with hundreds of available job vacancies.”
"The Task Force is also looking at what we can do now to tackle the longer term challenge of restructuring our local economy. We want to secure sustainable jobs for current and future generations of people.”
Responding to the announcement from the Official Receiver that the Redcar steelworks will undergo a hard closure, local Labour MP Anna Turley said:
“I am totally shocked and devastated by today’s news from the official receiver. I cannot believe the Government has allowed 170 years of steelmaking to fade away with no fight, no determination and no understanding of what this means to our area, to people’s livelihoods and to the British economy.
“The Government has had so many options on the table to keep the plant alive for the future, but it has turned its back, and shown total contempt for the workforce and the local community.
“The heart of our local economy has been torn out without a care from the Government. I will be calling for an enquiry to look at how this could have happened. We now need to explore how they are going to do this hard closure, what the cost is going to be, and to look at how this act of industrial vandalism could have been allowed to happen. The Government has shown its true colours, they care nothing for our history and heritage or our future.”
Steel union response to SSI 'hard closure' news
Commenting on news that the receiver of the SSI site is to close the coke ovens because no buyer can be found, Roy Rickhuss, General Secretary of Community, said:
"Clearly this is devastating news. The government must now step in, take the plant into temporary public ownership, and protect and preserve these vital industrial assets. Keeping the coke ovens running and mothballing the blast furnace effectively would give Teesside steel the chance of a future. A hard closure will just leave a community devastated and taxpayers picking up the cost of cleaning the site."
Following the news that the coke ovens and blast furnace at the Redcar steelworks are to close local UKIP MEP Jonathan Arnott expressed his “devastation”.
“This is truly devastating news and is the final nail in the coffin. The livelihoods of more than 2,000 people have been thrown on the scrapheap. It is outrageous and could all have been avoided if our government had not been forbidden by the EU from giving state aid.
“It is not just the jobs of those directly employed that are affected but the suppliers and the small shops and businesses they use. It is all very well putting in money for those made redundant, what new jobs will be created for them?
Angela Eagle MP, Shadow Secretary of State for Business Innovation and Skills, responding to the announcement from the Official Receiver that the Redcar steelworks will undergo a hard closure, said:
“This is devastating news from the Official Receiver that steelmaking on Teesside will end.
“The Government should never have allowed the situation to descend to this point, and must explain why they have continually sat on their hands and not taken any action to support this strategically important site.
“It is completely unacceptable that this Government’s ideological decision not to have an industrial strategy is costing high-skilled jobs in the country.”