The day before steelworker Sam Thomas was due to sign the mortgage on his new house last year, Tata Steel announced that it wanted to offload its Scunthorpe steelworks amid mounting losses. “I nearly pulled out of buying the house,” he says. “But luckily it has paid off.”
Thomas, 29, now runs one of the four blast furnaces at the Scunthorpe steelworks. The site was saved by a rescue deal in June led by Greybull, the family investment firm. It is now known as British Steel after the brand was bought from Tata Steel as part of the deal for Scunthorpe.
Thomas’s story highlights the devastating personal effect the closure of the steelworks would have had. Employing more than 4,000 people, making it the largest private employer in the area, the site looms large in the Lincolnshire town, and its scale takes the breath away. The perimeter of the steelworks measures more than 15 miles and the site covers 2,000 acres – a similar size to Scunthorpe itself. Inside there are more than 100 miles of railway line and 40 miles of road, but the site is dominated by the four blast furnaces and two cooling towers.
The blast furnaces are named after British queens: Elizabeth I – or Bess as the workers call it – Anne, Victoria and Mary. In a sign of the pressure still on the industry, only Anne and Victoria are operational at present, but it is clear the steelworkers take great pride in what they do.
“I love it. It’s a fantastic place. No two days are the same,” Thomas says. “I am proud to say I work at the steelworks.”
Thomas, who has been on the staff here since he was 18, wants the Scunthorpe plant to become a beacon for the global industry in terms of quality and efficiency. “I want us to be the benchmark,” he says. “That is my personal drive, where I would like to get to.”
British Steel revealed last week that the steelworks is back in profit just 100 days after it was bought from Tata. Roland Junck, the executive chairman, said the former owners had “lost interest” in the plan. The new company has focused on cutting costs – workers took a 3% pay cut; rebuilding its relationship with customers, which include Network Rail, Toyota, and Transport for London; and trying to become more specialised in the type of steel it produces.
“There have been some dark times,” Thomas says. “It does grind you down and you start to worry about your job and what the future might hold. It was pretty obvious that we were not part of its [Tata Steel’s] model going forward.”
Thomas said returning to the British Steel name was the “right thing to do”. The name disappeared in 1999 when British Steel merged with a Dutch rival to become Corus. Corus was bought by Tata in 2007 for £6.2bn.
Workers at the Port Talbot steelworks in south Wales will look longingly at the new optimism evident in Scunthorpe. Port Talbot is the only other steelworks in Britain with a blast furnace – which means it can make steel from raw materials – and the site dominates the small Welsh town even more than its Lincolnshire counterpart does. However, its future remains shrouded in uncertainty as Tata Steel considers whether to keep it, close it, or sell it off .
Paul McBean, chair of the Scunthorpe steelworks trade unions, said workers in Lincolnshire had gone through “14 months of sheer hell” until the rescue deal with Greybull was agreed. “When I go into town I get patted on the back for the work I put in, which is nice,” he adds.
However, British Steel still has a lot of work to do to deliver sustainable profits. The company wants the government to offer financial support by lowering business rates, controlling energy costs, stopping the dumping of cheap steel imports from China and offering contracts to British Steel on public projects.
McBean says politicians visit the steelworks then go back to London and forget about it: “Someone, someday is eventually going to have to give in and deliver.”
There are also concerns about Greybull after other businesses it controls running into trouble. My Local, the convenience store business, collapsed this summer while the future of Monarch, the low-cost airline, is also in doubt.
McBean says they have the support of workers in Scunthorpe. “Do I still have faith in our investors? Yes I do.”
While there may be doubts about Greybull, at least the Scunthorpe steelworks can now look to the future.
