BRITAIN’S biggest steelmaker has made a fresh plea for relief from swingeing green taxes that it claims make it uncompetitive with continental and Asian rivals.
Tata Steel employs more than 17,000 people in the UK but last year lost £560m because of weak steel demand and high costs.
Chancellor George Osborne introduced exemptions for steelmakers, letting them off levies that were introduced to fund expensive low-carbon energy, but delayed their implementation until the middle of next year. Brussels is to rule this autumn on whether the scheme falls foul of state aid regulations.
Karl-Ulrich Koehler, chief executive of Tata Steel’s European operations, has asked the chancellor to put the aid package into force as soon as the European Commission approves it. He claimed that doing so would save the beleaguered group more than £20m.
The chancellor will unveil the 2015 budget on March 18.
Advertisement
Despite big drops in the price of iron and coal, the two key ingredients for steel making, Britain’s industry is struggling. SSI, the Thai family firm that owns the blast furnace at Redcar, last year lost £194m.
The Engineering Employers’ Federation, a manufacturing trade body, claims the cost of green subsidies added on to energy bills increases production costs by £8 a tonne. In an industry where margins are already razor thin, this puts domestic manufacturers at a big disadvantage to overseas rivals.
The EEF said: “The single biggest step that can be taken in the 2015 budget will be to commit to introducing the final element of the energy intensive industry compensation package, as soon as possible after receiving state aid approval this year.”
SSI has made the same plea to the chancellor.