UK renews pre-Brexit financial aid pledge for Tata Steel - Firstpost
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UK renews pre-Brexit financial aid pledge for Tata Steel


London: The British government's offer of financial aid to Tata Steel UK and to potential buyers of its assets here is still on the table, business minister Anna Soubry said on Wednesday, despite Britain's shock vote last month to leave the European Union.

Representational image. Reuters

Representational image. Reuters

Seeking to avoid thousands of job losses, the government had offered millions of pounds in support for the company and its potential buyers. It also pledged to take a 25 percent equity stake in Tata Steel UK and reform the British Steel Pension Scheme (BSPS).

Speaking at a special steel enquiry in parliament on Wednesday, Soubry said: There is no change, (the offer) is still there.

Reforming the deficit-laden BSPS, which has some 130,000 members, is a major stumbling block for any buyer of Tata Steel's UK assets, and Soubry said reforms will take time.

The business minister, who opposed Britain leaving the EU, said she was still confident a buyer could be found, even as some MPs referred to reports that Tata Steel had put the sale process on hold.

"The relationship we have with Tata, we should not be pessimistic. We turned them round from their position in March, which was they were going to close Port Talbot," she said.

Tata Steel will hold a board meeting in Mumbai this week, and Soubry said business secretary Sajid Javid may fly out to India to talk to the board about the sale.

In response to MP's suggestions that the British steel industry could benefit from leaving the EU, Soubry said Tata Steel did not even see a net benefit in a falling pound, as it makes exports cheaper but ramps up import prices.

Tata Steel, Britain's biggest steel maker, put its UK assets up for sale in March. Up to seven parties have submitted bids or expressed an interest, though some bidders are getting cold feet after the referendum.

Soubry said the government would still consider the option of nationalising the business, which includes the giant Port Talbot steelworks in Wales, if no buyer could be found.

"We have looked and will continue to look at all options," she said.

First Published On : Jul 7, 2016 07:59 IST

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