UK Steel Industry & Media Reporting

Journalists are also more London centric now because of the demise of so many local newspapers.

Very good question regarding why we subsidise some businesses and not others. Taxpayers money is given to the companies than run the trains but not to the companies that make the steel for the rails.

Here are a couple of interesting points about the success or otherwise of the British Steel Scunthorpe site, where today the official receiver's spokesperson said this:

"The statement confirmed British Steel Limited is the only company in liquidation, and said British Steel Rail France SAS and other subsidiaries are not in insolvency and continue to trade normally."

British Steel supplies around 95% of Network Rail, and of course, it would be supplying to HS2, Crossrail2, etc., etc. It was also awarded a 2-year extension - under the watchful eye of Chris Grayling - to continue supplying Network Rail's major projects. Ah well.

Amongst other recent orders for the company:

March 2019 - March, Catalonia Government Railways (FGC) awarded British Steel a contract to supply rails for track renewal projects in the Spanish region

December 2018 - Italian Railway Network (RFI) awarded British Steel two multi-million pound contracts for a total of 86,000 tonnes of rail

October 2018 - Belgian infrastructure manager Infrabel awarded British Steel a 4-year network-wide renewal contract, with the supplier set to provide 35,000-40,000 tonnes of rail per year

Of course, these rail contracts may now be supplied from the company's plant in France.

Well I would point out the importance of rail wouldn't I, but British Steel don't just roll rails.

crystal Scunthorpe, unlike many other towns dependent on one industry has very good motorway communications to the rest of the country and also to ports like Immingham. It is on the edge of the Leeds conurbation and from the number of cars going along the M180 at 6.00pm last Friday, a lot of those workers live in places like Scunthorpe. Leeds is a centre for banking and the IT industry and there is no reason why these industtries should not move the short distance from Leeds to Scunthorpe where offices and housing is much cheaper. There are possibilities for warehousing and transport industries to be based there. And those are just the industries of today. As technology enables us to do so much work at arms length I am sure that these industries could be attracted to Scunthorpe. This could have happened long ago if the money invested in the dodgy dodgers that own the company currently had been redirected to improving the infrastructure, education and housing in the town. Then there is the enormous importance of wind farms in the north sea. These industries need services and workers, who do not necessarily have to live on the seashore. The technical skills of the steel workers would readily adjust to supporting this industry.

Scunthorpe is in a far better situation than towns like Hull, who are remaking themselves despite poor communications (no motorway) and being much further from the busy heart of Yorkshire.

I have said all these things in several previous posts.

You're dead right Griselda:

"I don’t understand why so many people see the closure of the Scunthorpe steelworks in purely economic terms. Other considerations like the destruction of communities should be taken into account."

Perhaps those same people don't live in communities - a bit like the BBC's "Escape To The Country" brigade - the prospective buyers never seem to want anyone living (or working) nearby.

M0nica - I do kinda get your point with this part of your post:

"Leeds is a centre for banking and the IT industry and there is no reason why these industtries should not move the short distance from Leeds to Scunthorpe where offices and housing is much cheaper."

But given the video conferencing, and telepresence solutions available to most businesses, why a need for office suites at all? Better use of IT and a digital infrastructure would reduce our carbon footprint/greenhouse gases, etc., at a few strokes.

From a business perspective that would destroy at least one tenet for building HS2 altogether. (HS3 is much more of a need, from the UK's economic perspective than HS2).

The money put into british Seel will not come back through tax because the company isn't making a profit - it is making a loss - so pays no tax. But the amounts put into the steel industry has been so large that it would take decades to get it back.

What the government has to do is decide whether the UK should have a steel industry. I think there is a good argument to be made for this on strategic grounds. Do we want to be dependent on imports for all our steel requirement.? If that is so then the government should take the steel works into public ownership. Any money invested in it would then go into the industry and profits - if there are any, would go directly to the government.

Grandad can I point out again, that the banks are actually repaying the loans that were made to them. The money spent in steel just runs down the drain.

That a particular GN member's husband worked in banking is irrelevant. The reckless lending made by the boards of big banks in this country and the US affected not only everyone in the banking sector but us as well. If all the banks had collapsed, all our savings, whether in stocks and shares, building societies or even just in a sock under the bed, not to mention the value of our houses and our pensions would all have gone to hell in a hand cart. The loans to the banks, benfitted every single one of us in one way or another, so stop trying to be holier than thou.

When you can prove that you in no way benefitted from your savings keeping their value, any money in the bank still being there for you, even if you only had a tenner, your pension unaffected. Then you can criticise others.

I think someone posted about the limited range of production at Scunthorpe?British Steel earlier - perhaps this link will help:

britishsteel.co.uk/who-we-are/

railman humankind are a sociable species, they need to talk to each other, to meet and build (business as well as other) relationships. offices, trains, good road communications and good housing will always be necessary.

You make some interesting and relevant points in your last post M0nica, and whilst the company may pay no tax - its employees will of course.

They will also buy stuff and contribute to the local, regional and national economy. Sometimes the small stuff is as important as the big stuff - and it's not a simple picture overall.

Still sad, and I can't see a happy ending. Maybe that BBC reporter was right with his shiny graphics and dubious 'facts' after all - it helps us get over this particular loss.

M0nica - absolutely agree with you about the importance of social interaction and communication. Seems like we'll still need steel for rails then?

Monica, I don’t really think Scunthorpe is on the edge of the Leeds conurbation. It is 56 miles away. I hardly think that makes it on the edge. Yes, they could transfer their offices to Scunthorpe but they won’t. Leeds’ communication routes are better and it is more trendy and upmarket than Scunthorpe. I don’t think banking and IT types would want to leave it.
The government would get tax back from the workers not just the industry and also from the vat on the workers’ spending. Better than benefits surely.

The money put into british Seel will not come back through tax because the company isn't making a profit - it is making a loss - so pays no tax.

It may not pay direct tax but it employs people and uses suppliers and services. All these are taxed either directly or indirectly. The money is not disappearing into a big black hole, never to be seen again, unless the greater part of it is disappearing offshore or is being used to pay foreign suppliers.

56 miles is on the edge of the whole Leeds spiders web of influence and it is in much closer to it in time as the M180, M18 and M62 tie it in with the main UK motorway system and place towns like Leed, Doncaster and York on its doorstep.

As I said car traffic from the Leeds/Doncaster region was pouring along the M180 in the Scunthorpe direction last Friday evening and the M18 which links the M180 to the M1 was nose to tail almost it's whole length from the M1/M18 junction to Thorne. Although it eased off after a lot of the traffic turned onto the M181 for Scunthorpe. Lots of people and lorries are already travelling round it if not to so it is well placed to pull in new industry in a thriving area.

railman but everyone in Scunthorpe would be so much better off the town just ditched steel, leaving it to the remote steelworks that really do have little else in the area and nothint to attract inward investment and concentrate on getting their share of what Leeds, York and Doncaster have.

I perhaps should have said 'hinterland' rather than 'conurbation'

I was, fairlyrecently, in Leeds for two days for the first time and travelled by Greyhound bus. I found it to be a really vibrant city with much to offer and the plans for the wider area around the town centre were explained at length over lunch with a member of Leeds City Council who had agreed to meet me.
He and his wife kindly agreed to show me some of the newer works and proposed building sites.
I was very impressed, so much so that I went online to look at property (apartment) prices.
I'd be quite happy to live there. It's a handsome place.

Grandad1943
BS was nationalised in 1967.A disaster waiting to happen.
1979 saw the closure of one of BS largest plants being Corby Northamptonshire. More were to follow. The beginning of is end way before that word, so many use as an excuse, came into being.

Sure China's output over last 2 years wasn't compared to UK over 149 years. Think it was given as 70 yrars, which is bad enough. And we are blamed for all air pollution, something just doesn't match up.

I did read in the news that China's output over 20 months matched or exceeded that of BS over 149 yrs but maybe they meant to print 'since 1949', not 149 years.

How is the EU responsible for the failure of the steel industry

Britain needs steel. Unlike with coal mining, I support some kind of bailout. What happens if China decide to charge a ridiculous price for their steel in the knowledge Britain would only have Port Talbot (for now!) and have to be reliant on an overseas provider?

glammagran
Do correct me if I'm wrong but if BS were to continue, they would still have to import coal from China for their furnaces and China could hike the price. No pay=no coal=no business.

GabriellaG54, if China were to up the price of their coal to British Steel then without doubt, supplies could be sourced from other counties.

However, what I do not understand is why the government are stating that to give only thirty million to British Steel in subsidy would be illegal when 500 billion was given to the banking and Finance industry over more than seven years.

That money often went to the very people who caused the banking crisis through incompetence and greed. However, those in British Steel who have worked so hard and cooperated with management to try and secure their industry and employment are being told they can have nothing.

Totally Disgusting.

Leeds isn't Scunthorpe, any more than Manchester/Didsbury is Blackburn or Burnley.

These poor northern areas need financial input, improvement on infrastructures. The heavy traffic around our main cities here is a nightmare and not helped by poor public transport links. If you live in north Manchester, getting into town by car can take 1 1/2 hours for a 12 mile journey. Trains lack enough carriages to transport the numbers going into the city - you stand if you're lucky enough to be able to get on.

At the time of the financial crisis I remember reading that one of the bail out conditions was that it would enable banks to support small businesses with loans and overdraft facilities to enable survival and growth. I’m almost laughing my head off thinking about it. They in fact did the opposite and hiked up the interest on loans way above base and called in many overdrafts, putting a lot of SME’s out of business. We only survived because we literally sold everything we owned. In over 25 years of being in business we haven’t had a single penny of tax payers money.

Excellent post Iam64. I believe that some forum members are living in a totally delusionary world in regard to the infrastructure that surrounds many of the UKs northern cities.

Even if large amounts of funding were to be placed into that infrastructure (which there are no plans to do at present), then it would still take very many years for that to feed through into local economic growth.

If anyone wishes to witness evidence of the above just look at Avonmouth and Severnside. That is now an area where many companies wish to locate. However, following the closure of three large manufacturing plants in Avonmouth through the 1980s it has taken more than thirty-five years and huge amounts of money to be placed into the local infrastructure to bring the area to what it is now.

Yes, but Scunthorpe has good communications. I compared it with Hull just across the Humber that doesn't. I also referred to nationalising steel works in towns with poorer communications to keep them in business for national strategic reasons

This is the point. Scunthorpe has good communications, access to a large port, and is on the edge of a busy and thriving area. Plenty of those working in Doncaster and Leeds live in the Scunthorpe area. It is the exception to the rule.

Grandad Again as I have said before, if the government had not lent money to the banks it is you and I and every taxpapayer who would have been plunged into penury. It is easy to forget this when , for us, everything stayed unchanged and the bankers are paying the money back.

What failing industry which has had government grants and subsidies as well as loans ever paid a penny of it back?