Business leaders, unions and politicians from all parties have lined up to attack the Government for failing to prevent the collapse of British Steel.
The North East England Chamber of Commerce accused Ministers of a “gross misjudgement” after British Steel went into official receivership after talks with the Government failed to secure its future.
Business Secretary Greg Clark said state aid rules prevented Ministers from acting after British Steel owners Greybull had asked for financial aid to help it with problems related to Brexit and other issues in the global steel market.
But Tees Valley Conservative mayor Ben Houchen accused his own party of “hiding behind European Union rules” and said he was calling together MPs and council leaders in the area to see what could be done to keep plants open.
The move to put the firm into receivership puts hundreds of jobs in the North East in danger, with the company having major plants at Skinningrove and Lackenby, on Teesside, plus a smaller site at Blaydon, Gateshead .
County Durham firm Hargreaves Services has also warned that 170 jobs would be at risk if the company failed due to contracts it has with the firm.
North East England Chamber of Commerce chief executive James Ramsbotham said: “This is devastating news both for the North East and the UK as a whole. Refusing to step in and provide assistance to the company is a gross misjudgement by the Government.
“Steel is a strategic industry and an integral part of the UK supply chain and ending our ability to produce steel leaves us at the mercy of overseas producers. The Teesside mills at Lackenby and Skinningrove are two facilities of national importance and everything possible should now be done to ensure a buyer for those profitable sites is found.
“Following the collapse of SSI the whole of the Tees Valley pulled together to ensure the closure did not become an economic catastrophe and the Chamber and business community stand ready to assist those affected both in British Steel and the supply chain.”
Mr Houchen said: “British Steel’s owners, Greybull Capital, have been complete sharks throughout this tragic process. Greybull offered a measly £1m to save the company, and then expected the taxpayer to cough up while they laughed all the way to the bank.
“It is clear that my request for temporary nationalisation to save 700 jobs has fallen on deaf ears. The Government argue that bailing out a failing company is prohibited under strict EU state aid laws, but I’m not buying it.
“I brought our local airport back into public ownership to prevent closure, and countless other European countries have stepped in save their steel industries to prevent collapse. Hiding behind European Union rules does absolutely nothing to help 700 workers who’ll be worried about their jobs and livelihoods today.
“Yet again the people of Teesside have been shafted by heartless private investors, and a Government completely unwilling to pull their finger out to help local workers.
“This issue is much bigger than party politics and so I have written to every MP and council leader in our region to convene an urgent meeting this Friday. As a region, our one and only priority will be to ensure Teesside jobs are protected and the company’s profitable plants at Lackenby and Skinningrove remain open.”
Shadow Transport Secretary and Middlesbrough MP Andy McDonald tweeted: “British Steel provides nearly all the steel for the UK’s railway. Losing this supply could have serious consequences for the rail network.
“The govt should be prepared to take a share in the company to protect tens of thousands of workers who support it both directly & indirectly.”
