British Steel plans to axe hundreds of jobs in plans to close its coke ovens in Scunthorpe and will “optimise” several hundred more, a union source has said.
The Chinese-owned manufacturing company was said to be cutting 300 jobs from the coke ovens, with another 600 to 900 being “optimised”. It was unclear what this optimisation would mean.
It comes as ministers are considering a multimillion-pound rescue package for the struggling business.
Earlier on Wednesday, Sky News reported that the business had a plan which could see around 800 workers made redundant.
The redundancies would focus mainly on the plant in Lincolnshire. British Steel employs around 4,000 people across the UK.
The Government is reportedly considering cash injections into both British Steel and Tata Steel UK.
British Steel declined to comment when asked about the potential cuts.
Last month the Financial Times reported that Chancellor Jeremy Hunt was close to signing off on the support package, which could funnel around £300 million to British Steel, with an “equivalent” sum going to Tata.
But it is unclear what the latest threat of redundancies could mean for this negotiation.
Ministers had reportedly demanded that the companies had to protect jobs if they wanted the Government handout.
The funding is reportedly also set to be linked to decarbonisation efforts from the steel giants. It will help replace British Steel’s blast furnaces with electric alternatives, officials hope.
Once a giant of British manufacturing, the business has struggled over the past decade.
China’s Jingye Group became the manufacturer’s third owner in four years when it bought British Steel out of insolvency in 2020. But now Jingye thinks it needs taxpayer funding to keep the doors open.
Charlotte Brumpton-Childs, national officer at the GMB union, said: “This is devastating news for the people of Scunthorpe and all British steel workers across the UK.
“With grim predictability, the Government’s investment is a sticking plaster that does nothing to help the long-term structural issues affecting our steel industry.
“Now, steel workers, their families and communities will once again be asked to pay the price.
“GMB urges British steel and the UK Government to continue talks. Ministers need to decide if they want the UK to have a future in steel or whether they want it to wither and die like so much of our proud manufacturing heritage.”
Alun Davies, national officer at the steelworkers’ union Community, said: “We are extremely concerned about the reports that British Steel is looking to cut hundreds of jobs.
“This move would represent a betrayal of their loyal workforce and their commitments to invest in the business. We believe this would put staff at risk and is completely unworkable.
“British Steel is already putting staff at risk by making them work overtime every single week. Cutting hundreds of jobs in this situation will endanger workers by pushing them to work even longer hours in extreme temperatures.
“Steelworkers played their part to protect our steel industry and are being failed by both the Government and British Steel who are abdicating their responsibilities to the workforce and our country.
“British Steel should urgently clarify its position and know that we will use any means at our disposal to fight this dangerous plan.”
The Prime Minister’s official spokesman said: “Any reports of prospective job losses would be of concern. I can’t necessarily comment on speculation but the Government always stands ready to provide or signpost assistance for anyone who needs it.
“In terms of long-term support for UK steel, this is a Government that has taken a number of steps in this space.”