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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

Tata steel crisis: Sajid Javid tells workers there's time to reach a deal - as it happened

Tata steel crisis: Sajid Javid reassures workers in Port Talbot - video

Evening summary: Steel crisis rumbles on

It’s less than 72 hours since Indian conglomerate Tata threw the entire future of the UK industry into uncertainty.

So, three days later, where are we?

Business secretary Sajid Javid has finally visited Port Talbot, in an attempt to defuse the heavy criticism piled on his shoulders over the crisis.

Javid told a crowd of patient but anxious workers that there is time for a deal to be reached. He also claimed that the government had managed to avoid the immediate closure of Tata UK.

As Javid put it:

We are on your side.

The time is there, meetings today have been constructive, but also with Tata management in India, they have been very responsible, they’ve shown in the past as a group they are a responsible company, they’ve had to sell things in the past, I take confidence from that and so should you.

It’s still not at all clear, though, how steel working will be maintained at Port Talbot, and beyond.

Javid also admitted being caught out by Tata’s decision to sell its British steelmaking sites so quickly. He told reporters that:

..That’s why I rushed back here. Talk about three or four weeks isn’t what I had in mind.

I’m pleased to say there is an understand that this is actually a much longer process - that’s what’s needed to find a long-term buyer.

He’s now urging them to help potential buyers carry out the necessary due diligence.

Javid was also forced to handle questions over his decision to take his daughter to Australia with him, and for not being in Wales sooner.

He insisted that it was not “a jolly”, after being told to consider his position in the government by local Labour MP, Stephen Kinnock.

The government has also been heavily criticised by the European steel industry for blocking efforts to prevent Chinese steel dumping. It’s simply not true to say the UK has done all it can, a spokesman said.

But the tariff issue has flared up tonight, after it emerged that China is imposing tariffs on European steel, including products made in Wales.

Here’s the full story:

And there are also signs that Tata is preparing for life after Port Talbot. It is apparently talking to German conglomerate ThyssenKrupp over a potential merger of assets.

That’s probably all for tonight, and this week. Thanks for reading and commenting, and stay tuned to www.guardian.co.uk for further developments.

Updated

During his visit to Port Talbot, Sajid Javid claimed that Britain had been leading efforts to block Chinese mills dumping cheap steel on Europe.

He said:

“I agree the EU needs to act more quickly.”

Senior Labour MP Yvette Cooper isn’t impressed, given the evidence that the UK has been blocking higher tariffs.

Updated

Labour's Eagle demands answers over steel crisis

An email just landed in Sajid Javid’s inbox, from his opposition opposite number, Angela Eagle.

She is asking Javid to “urgently” contact Beijing, to discuss reports that China has slapped a tariff on British steel.

And she also asks a string of questions about crisis, including these five queries regarding Port Talbot:

  • When was your office first made aware of the Tata Steel board meeting in Mumbai; and when and why did you not see fit to go to Mumbai to lobby the board?
  • What communication have you personally had with the board of Tata Steel in the weeks leading up to their meeting in Mumbai and what communication have you had with them subsequent to the decision they made on Tuesday 29 April?
  • After the so-called emergency meeting in Number 10, the Prime Minister spoke of the interventions he had made. Can you inform me what these interventions consisted of?
  • It is still unclear how long Tata Steel plan to keep Port Talbot steelworks open for while a buyer is found. Can you confirm how long is left to save the plant?
  • Tata Steel are believed to have appointed PwC to advise it on the restructuring of its UK business. Can you shed any light on what options are being looked at by PwC, and what involvement the Government is having in these discussions?

The Labour party are trying to keep the heat on the government tonight.

They’ve launched a new campaign, accusing David Cameron of giving “handouts” to the rich, but selling out the steel industry.

Updated

Sajid Javid has urged Tata to push on with the process of finding a buyer for its UK steel assets.

Speaking after his meetings with management, unions and workers at Port Talbot, the business secretary says Tata must produce the necessary paperwork, pronto.

“I think the most immediate need is for Tata to set out its offer document with the details and to make sure that all potential buyers have all the relevant information they would need.

You would naturally expect them to want that early on, as early as possible, ... so they can complete that due diligence as quickly as possible.”

The business secretary is tweeting from his limousine:

Here’s a video clip of Sajid Javid speaking to some of the Port Talbot steel workers:

Tata steel crisis: Sajid Javid reassures workers in Port Talbot

Here’s our latest news story from Port Talbot:

Javid defends Australia trip

Britain’s Business Secretary Sajid Javid (C) leaving the Tata Steel plant in Port Talbot.
Britain’s Business Secretary Sajid Javid (C) leaving the Tata Steel plant in Port Talbot. Photograph: POOL/Reuters

Sajid Javid also defended his decision to travel to Australia, with his daughter, as the steel crisis was escalating (reports our Graham Ruddick).

Asked whether he regretted taking his daughter on the trip, he said:

“Oh not at all. I think that you know, call me old-fashioned but I’m a father who likes to spend as much time as possible with my children and if that means spending time with them, squeezing it in at work or on a business trip then that’s what I would do.

Responding to criticism that it made the trip look like a “jolly”, he said:

“Well I certainly wouldn’t call going to Australia a couple of days and packing it with meetings a jolly.”

Updated

Steel crisisWorkers wait to speak to Business Secretary Sajid Javid as he leaves Tata Steel in Port Talbot, South Wales, as the Government outlined its response to the crisis gripping the steel industry. PRESS ASSOCIATION Photo. Picture date: Friday April 1, 2016. Javid met managers and staff after having to cut short a business trip to Australia to deal with the aftermath of Tata Steel’s shock decision to sell its loss-making UK assets. See PA story INDUSTRY Steel. Photo credit should read: Ben Birchall/PA Wire
Steel workers in Port Talbot Photograph: Ben Birchall/PA

Steel worker: It's a kick in the guts

According to the Press Association, Sajid Javid was met with “a handful of boos” as he left the meeting to meet staff, and was handed a Save Our Steel badge.

Britain’s Business Secretary Sajid Javid is given Save Our Steel badges as he talks to workers as he leaves the Tata Steel plant in Port Talbot.
The moment Javid was given a Save Our Steel badge. Photograph: POOL/Reuters

PA adds:

Around 800 workers had waited patiently in the cold for over an hour and a half for Mr Javid to depart.

Many had come in on their days off or hours ahead of a long night shift so they could show the minister and the UK Government the strength of feeling and worry amongst the workforce.

One hot mill worker, Christopher Walters, 48, said staff felt like they’d been “kicked in the guts”.

We knew that things were looking bad about six to eight months ago so it’s a pity that all these pledges of support from the Government and Parliament were not made then.

“We have all come out in force today to show the strength of feeling about it.”

Updated

Here’s the moment the business secretary exited Port Talbot after meeting workers outside the site:

Javid: There will be interested buyers

Workers outside Port Talbot

Q: “Are there any potential buyers” asks another steel worker, in a hard hat and holding a banner.

I can’t name people who are expressing interest, for commercial reasons, Sajid Javid replies.

Q: So there are people interested?

There most certainly will be people. But the process is just beginning. And the unions will be fully involved, Javid says.

And then he heads into his limo, and out of the site, as a chant of “Save our Steel” breaks out.

Updated

Javid: Steel is absolutely vital

Q: Have we got an industry, another steelworker asks.

The industry is absolutely vital to the future of the UK industrial sector, Javid tells the crowd of Tata UK staff at Port Talbot.

Absolutely vital, he repeats.

Updated

Sajid Javid continues:

We will work with Tata, with the unions where we have a “fantastic relationship”, and with the Welsh government to make sure we secure the future of this site.

Sajid Javid meeting Tata workers

Javid: There's time to get a deal

Sajid Javid is meeting with the crowd workers outside the Port Talbot plant right now.

The business secretary starts by telling them that the government will work with all parties to get a deal, insisting that “we’re on your side”.

Q: So you’re not going to let us go to the wall, asks one steel worker.

Welsh secretary Alan Cairns replies that “We’re going to do everything we can”.

Q: Is there time, asks a second worker?

I think the time is there, Javid replies. Meetings today have been constructive -- as have meetings with Tata management in India.

They have shown in the past that they are responsible, when they have sold assets, says Javid:

I take confidence from that, and so should you.

Updated

Javid speaks at Port Talbot

Sky are now running an interview with the business secretary from Port Talbot.

Sajid Javid begins by saying the government has been “engaged with Tata for actually weeks on this particular issue”.

He says:

I was actually here a month ago, and I’m glad to be back here today to speak with Tata, with union representatives, with some of the workers, to get an update on the latest developments.

While there might be a surprise out there publicly, we’ve worked with Tata for a long time on this. We’re working really hard to save this plant, and make sure we can find a new buyer to give it a long-term future.

Q: But didn’t Tata tell you what they were going to do - and if they did tell you, why didn’t you realise what a devastating impact this would be?

We’ve discussed a lot with Tata, Javid replies, but we need to keep it commercially sensitive.

Q: But how did you fail to realise the impact?

We understand it’s very, very difficult news, especially for the local community, Javid insists.

Javid then admits that he was caught out by Tata’s decision to sell the plants quickly.

I got concerned about [that], and that’s why I rushed back here. Talk about three or four weeks isn’t what I had in mind.

I’m pleased to say there is an understand that this is actually a much longer process - that’s what’s needed to find a long-term buyer.

Updated

Some unedited footage of Sajid Javid’s meeting with workers has just arrived:

Sajid Javid at Port Talbot

Workers in the car park at Port Talbot are holding ‘Save our Steel’ signs, and telling reporters that they want to hear concrete action from the government.

Promises, and claims that ministers are “doing all we can” won’t be enough.

The waiting might be over, reports my colleague Graham Ruddick who is with the workers at Port Talbot.

Steel workers at Port Talbot have now been waiting almost two hours for Sajid Jabid to emerge from his meetings.

Via Huw Silk of Wales Online.

Updated

The Wall Street Journal has now confirmed that Tata is in talks with German engineering conglomerate ThyssenKrupp about merging their steel operations.

And depressingly for UK workers, this deal is now possible because Tata is giving up on the UK.

The WSJ says:

Credit Suisse analysts....say Tata’s planned exit from the U.K. was a prerequisite to any potential deal with Thyssenkrupp.

“This scenario in turn could lead to the creation of a 20 million tons high quality steel producer in Europe, and the eventual exit of steel for Thyssenkrupp, with arguably a strong synergy story,” they said.

Updated

We had expected to hear from Sajid Javid around 2.45pm today, so the business secretary’s meeting are running 45 minutes late.

GMB: Tories want to get into in bed with communist China

Tim Roache, general secretary of the GMB union, has thrown the (red?) book at David Cameron for blocking higher tariffs to prevent Chinese steel imports.

“Never in our wildest dreams did we consider that the Tory Party would allow the Chinese Communist party to dictate the fate of vital industries like steel and energy in the UK.....

“There was a time when the Tories sought to root out the reds under the bed. Now they want to get into bed with them.”

Updated

Quite a crowd now:

Workers are continuing to gather outside the building in Port Talbot where business secretary Sajid Javid is meeting with managers:

.

We’ve gathered together the views of people who live in and around Port Talbot, as they watch their steel industry fight for survival.

It’s a sobering read, and a vital reminder of how crucial steel is to the area.

Kristian Watts, who works in Tata Steel’s energy department, explains that the town would ‘crumble’ if the industry shuts down:

I’ve lived in Port Talbot all my life. The steel works employs not only so many of my friends, but also my family. It means everything to not only Port Talbot, but West Glamorgan, Mid Glamorgan and beyond. I know lads who travel from Ebbw Vale, Newport, Swansea, Neath and even Haverfordwest. This industry is everything to South Wales.

Without it, the town would crumble. It’s the smaller things people don’t realise will be affected. Like paper shops, supermarkets, small businesses that rely on trade from workers from the plant. Without jobs to provide money for bills and mortgages, the workers would have to rely on the council for accommodation and benefits, which is already very high in this part of Wales.

My message to the government would be to take a look at what they have created by not lowering business rates and allowing the Chinese to dump massive amounts of steel without having to pay a great deal of tax. If they aren’t careful, they will have a economic crisis on they’re hands and they have only themselves to blame.

Tata’s Indian owners cannot be blamed – they pumped a huge amount of money into the works and for what they were asking for in help seemed a small penny compared to what it’s going to cost the government in the long run.

Here’s the full piece, by my colleague Elena Cresci:

The cause of Britain’s steel crisis is simple, and chilling, according to Oxford economics professor Simon Wren-Lewis.

One set of producers [in China] are trying to eliminate their competitors by flooding the market at a loss because they have the ‘deep pockets’ of a state behind them.

And as Wren-Lewis explains in this blogpost, Britain’s government is complicit in it [as we reported this morning].

The EU have been trying to raise tariffs against Chinese steel producers for three years, but have been blocked by a coalition of countries led by the UK.

The UK Business minister Sajid Javid has been quite explicit about this: he prefers cheap steel because it helps other parts of UK industry. It may also have something to do with wanting to curry favour with China because of other matters (which was the point of John McDonnell’s Little Red Book stunt, if only he hadn’t started reading from it!).

This is not Javid upholding the principles of a free market, but instead allowing a large state to rig a market. The irony in this case is that the state in question is not the one he works for.

Another photo of Sajid Javid’s welcoming committee:

Crowds of steel workers have gathered at Port Talbot, as they wait for Sajid Javid to emerge from his meetings:

Port Talbot today.

Two-thirds of the UK public think the Port Talbot steelworks should be nationalised, according to a poll of 1,001 people conducted by Sky News

.

Richard Tauwhare, a senior director at law firm Dechert, agrees that Europe needs stronger defences to ride out the steel crisis, without falling into full-blown protectionism.

Tauwhare says:

“EU trade measures alone cannot address all the challenges facing the steel industry. But unfair competition, in any sector, can and does seriously threaten EU producers.

The EU needs to streamline its procedures and sharpen its defences, while continuing to guard against the risks of veering into protectionism.”

Updated

Britain needs to urgently drop its opposition to imposing higher tariffs on Chinese steel, says Gareth Stace, director of UK Steel, the trade body.

Stace says that Europe could consider the ‘nuclear option’ of blocking steel imports into Europe, given the precarious state of the sector [under trade law, a country can impose emergency safeguards].

As Stace puts it:

“The Government must today change its position blocking the scrapping of the Lesser Duty Rule – removing the sign above Europe, saying ‘please dump here, you’re welcome’. We should follow the lead of our German counterparts who stand firmly behind their steel industry, manufacturing and consumers by backing the scrapping of the LDR.

“There are more tools in the Trade Defence Instrument box and if the UK Government and other members states now accept that steel making in the Europe is in ‘emergency measures’, then even the nuclear option of ‘safeguards’ must be on the table.

Enacting ‘safeguards’ would effectively halt the flood of imports into the EU, which is drowning us in full sight of the global sector. Such a bold move, would give us time to breathe, take stock and see light at the end of the tunnel..

It would also risk tit-for-tat moves from other countries. But that could still work in Europe’s interests, given the amount of steel coming in from China.

Another tweet from the business secretary, as his trip around Port Talbot continues:

Steel workers and NHS staff have linked hands outside the Port Talbot steel works today in a show of solidarity:

Steel crisisSteel workers and NHS staff outside the UK’s largest steel works in Port Talbot, South Wales, which Indian owners Tata are looking to sell. PRESS ASSOCIATION Photo. Picture date: Friday April 1, 2016. Ministers have been accused of prioritising trade links with China over support for the UK steel industry as Sajid Javid prepares to meet steelworkers in Port Talbot. See PA story INDUSTRY Steel. Photo credit should read: Ben Birchall/PA Wire

Business secretary Sajid Javid has tweeted that he’s had a “good productive meeting” over the Port Talbot crisis.

That’s Welsh Secretary Alun Cairns and his officials, plus local Labour MPs Stephen Kinnock and Christina Rees.

At least one Conservative MP is sanguine about the troubles in UK steel, reports Jim Pickard of the Financial Times:

China 'imposes anti-dumping tariffs' on EU suppliers!

In a development that will not improve the mood in Port Talbot, China has apparently slapped new anti-dumping tariffs on steel imports from Europe.

Reuters has some details:

China, accused of flooding world markets with cheap steel, has imposed anti-dumping duties as high as 46.3% on electric steel products imported fromJapan, South Korea and the European Union, the Ministry of Commerce said on Friday.

The overseas suppliers include JFE Steel Corp, Nippon Steel and Sumitomo Metal Corp and POSCO, the ministry said in a notice posted on its website.

The ministry did not identify any EU supplier.

The announcement is in Chinese, so I’m afraid I can’t add much details...

...but Sky’s Faisal Islam has done some digging, and uncovered that this will cover steel products made in Wales (!).

This does not appear to be an April Fool’s joke.

Sajid Javid’s ministerial limo has been spotted in South Wales:

Lord Mandelson: Don't rule out temporary nationalisation

Lord Mandelson.

Peter Mandelson, the former EC trade commissioner, is urging the UK government not to close its ears to the idea of temporary state ownership of the steel industry.

Mandelson, an architect of Tony Blair’s New Labour and a former UK business secretary (among other roles punctuated by occasional resignations), says Britain’s manufacturing sector has reached an “existential moment”:

The closure of Port Talbot’s blast furnace would mean we no longer make steel as opposed to processing and recycling steel.

If we allow this to happen we will lose the modern, high productivity infrastructure and skills we have there and offer steel imports a big opening to the UK market.

Mandelson wants to see a “strong” government intervention, and a pan-European strategy to help the steel industry across the region.

And temporary nationalisation could be pat of the answer, he adds, while a buyer is found.

The governments in London and Cardiff must continue their search for a new private sector investor in Port Talbot and use their convening power to encourage restructuring or cancelling of debt. That will enable potential new investors to assess the true value of the technology, skills and capital investment which in any sensible valuation are far from ‘worthless’. Tata UK needs to recognise its responsibilities to its pensioners and its sites and should co-operate fully with the UK government in the search for solutions.

In principle, I would not rule out temporary government ownership of the Port Talbot plant as a step towards finding new long term owners.

Mandelson also argues that EU state aid rules needn’t be a barrier to a rescue - especially if Brussels is co-operative.

EU state aid rules can support a serious plan to restructure around new specialised technology and long term viability. The European Commission should be urged to use the ‘critical infrastructure’ public interest case for steel and establish collective rules to provide state aid for restructuring plans, bridging finance and future investment.”

Updated

The campaign to ban selfies gets an unexpected boost:

Tata steel's pensions problems

More than 130,000 steel worker and former steel workers have been left in the dark about the future of their pension as a result of the crisis.

The British Steel Pension Scheme (BSPS), which was inherited by Tata when it bought Corus in 2007, has £14.5bn of liabilities, making it one of the biggest pension schemes in the UK.

However, members of the pension scheme, which has a deficit of £485m, face an uncertain future if Tata sells the business.

Tata sources say the cost of the pension scheme is one of the main issues facing the steel business in the UK. Accounts for the business show that last year Tata pumped £129m into the scheme last year and will spend even more in 2016.

John Ralfe, a pensions expert, said Tata Steel’s UK operations are a “pension fund with a business tagged on”.

He warned that Tata could be forced to pay more than £2bn into the scheme if it sells the business.

He said:

There is a complete vacuum, Tata Mumbai needs to come out and say exactly what is happening to the BSPS.

Tata hasn’t addressed annual pension costs early enough. They should have closed to existing members a long time ago. They took the easy option.

They could have to pay more than £2bn to keep the regulator happy.

If the business did collapse into administration the pension scheme would enter the Protection Pension Fund.

Updated

Tata won't comment on German tie-up reports

Tata Steel is declining to comment on those reports that it is planning a tie-up with Germany’s Thyssenkrupp, once it has shed its UK operations.

Asked about the story, Tata would only say:

We do not comment on media speculation.

Tata also confirmed that it has appointed PwC to advise it about the restructuring of its UK business, but won’t give further details.

A spokesperson in Port Talbot says:

Like all large firms we use a range of professional advisors for tasks where they have particular expertise. We don’t make public statements on the details of such advisory relationships.

Osborne: We're doing everything we can

George Osborne has just hit back at the stinging criticism that the government has been pandering to China rather than protecting the UK steel industry.

Speaking in Manchester, the chancellor declared:

Internationally we are working to make sure that there are tariffs on unfair cheap exports.

Domestically we are doing everything we practically can, everything we possibly can to help the steel workers, help the steel industry.

That’s why the business secretary is is there in Port Talbot today, looking for long-term solutions.

That may come as a surprise to the European Steel Association, who insist that Britain has NOT been been doing everything it can, and has been the ringleader in blocking higher Chinese tariffs.

Osborne was sporting a high-visibility jacket but ditched the hard hat that he often wears for photo ops:

George Osborne today

Maybe he has lent the hat to Sajid Javid, for protection against irate steel workers....

Updated

UK taxpayers could be forced to stump up £1.5bn per year if the government bites the nationalisation bullet and takes Tata UK’s operations into public hands.

That’s clearly not-insignificant sum of money. So what else could we do with it? Well, you can get half an aircraft carrier -- although that wouldn’t stretch to any planes.

And it’s only a fifth of the cost of a new nuclear sub, or just 3% of the bill for building the HS2 railway link...

For more neat comparisons, click here:

Updated

In another potential embarrassment for the UK government, Tata is reportedly considering taking a stake in the steel unit of Germany’s Thyssenkrupp.

German business paper Rheinische Post reports that talks between the two parties are at an “advanced stage”.

One option is that they could create a joint venture, with Tata Steel holding an option to increase the stake at a later date, apparently.

Tata Steel have declined to comment on the claims to Reuters.

If it’s true, it shows that Tata remains interested in European steel operations despite the problems in the UK.

Shares in ThyssenKrupp have jumped by almost 5% this morning. Analysts have already speculated that a merger between the German and Indian firms makes sense, given the tough conditions in the global steel market.

Steel crisisThe UK’s largest steel works in Port Talbot, South Wales, which Indian owners Tata are looking to sell. PRESS ASSOCIATION Photo. Picture date: Friday April 1, 2016. Ministers have been accused of prioritising trade links with China over support for the UK steel industry as Sajid Javid prepares to meet steelworkers in Port Talbot. See PA story INDUSTRY Steel. Photo credit should read: Ben Birchall/PA Wire
The UK’s largest steel works in Port Talbot, South Wales. Photograph: Ben Birchall/PA

Workers in Port Talbot are eagerly awaiting the arrival of business secretary Sajid Javid in a few hours time.

We’re expecting to hear from the business secretary in the early afternoon, as he meets with workers, management and unions.

He will need to explain how the government allowed the crisis to reach this point, why they have blocked higher tariffs on Chinese steel, and whether his own job could be at risk.

Javid will tell workers that the government is “on their side”; but the Welsh community in around Port Talbot want to hear action, not platitudes.

So it could be a pretty uncomfortable trip for Javid -- who may already be suffering the effects of those two long flights to Australia and back this week.

Steel tariff row explained

Here’s a Q&A on the steel tariffs row, from Kate Ferguson of the Press Association.

Q: What is a tariff?

A tariff is a form of tax imposed on goods or services imported from abroad. It can restrict trade by making products more expensive, and can be used as a form of protectionism - to protect and encourage domestic industry.

Many in the UK steel industry have demanded higher tariffs be imposed on imported steel amid concerns Chinese steel dumping has sent prices plummeting.

Q: What is steel dumping and why are the Chinese accused of it?

Steel production in China has soared over the past decade and it now produces around half of the world’s annual output of 1.6 billion tonnes. But its domestic market has been slowing, leading steel producers to seek to export more.

China has been accused of “dumping” its steel on European markets - which means selling it not just cheaply, but at a loss. In 2014, Chinese steel imports to the UK cost €583 a tonne compared to €897 a tonne for steel produced elsewhere in the EU, according to reports quoting the EU’s statistics agency, Eurostat.

Q: Why has the British Government been criticised for not doing enough to protect the UK steel industry?

Sharply falling prices and a flood of cheap, foreign steel has sparked major concern for the future of the British steel industry, and the many jobs that depend on it.

British ministers blocked proposals in the EU to get rid of the “lesser duty rule” which caps tariffs at 9% - in the US some products face a tariff of up to 236%. The British Government has said the 9% tariff is too low, but warned against lurching towards protectionism.

The debate comes as Britain has been courting China hard in a bid to foster closer trade links. Chancellor George Osborne said the two nations should “stick together and create a golden decade” while on a visit to China last September.

The following month, Chinese President Xi Jinping visited Britain and was treated to a State banquet at Buckingham Palace, where he sat between the Queen and the Duchess of Cambridge.

Set in this context, the Government has been accused of betraying British steelworkers to curry favour with the Chinese.

Updated

Britain’s manufacturing sector has suffered another tough month, according to the latest survey from data firm Markit.

Export orders contracting for a third month in a row, and firms reported that they laid off staff again.

The overall PMI, which measures activity, came in at 51. That shows marginal growth, underlining how UK factories are struggling despite talk of economic recovery.

UK manufacturing PMI

Clegg: Osborne has put China ahead of UK

Nick Clegg.

Nick Clegg, the former deputy prime minister, has waded into the steel crisis row this morning.

Clegg pinned the blame for Port Talbot’s woes firmly on chancellor George Osborne, accusing him of prioritising relations with China over the future of UK industry.

Clegg, who was in government between 2010 and 2015, said:

“George Osborne has put his special relationship with China above the UK’s best interests.

The Conservative Government have continually failed to take action and missed many opportunities to help the UK steel industry, such as taking steps to prevent dumping of cheap Chinese steel on the UK market.

“The Government must now act before more steel jobs across the UK are put at risk.”

(thanks to the Press Association for the quotes)

There’s no argument that George Osborne is committed to building closer economic, political and diplomatic ties with China.

The Economist recently dubbed this the “Osborne Doctrine”, warning that the chancellor is leading a radical, and under-examined, shift in policy.

The UK steel crisis means Osborne’s relationship with Beijing is now under much closer scrutiny.

Labour MP Stephen Kinnock piled further pressure on Sajid Javid last night, saying the business secretary should ‘consider his position’.

The Huffington Post’s Graeme Demianyk has neatly summarised why Javid is under fire:

More here: Sajid Javid Accused Of ‘Boundless Stores Of Incompetence’ Over UK Steel Crisis

Could nationalising the UK steel industry work?

Plenty of people are pointing out that Tata UK’s losses of £1m per day are dwarfed by the multi-billion pound cost of rescuing the banks in 2008.

David Cameron says it’s not the long-term answer, but we should remember that a previous Conservative prime minister, Edward Heath, showed that nationalisation can work.

Our economics editor Larry Elliott explains:

In 1971, Whitehall stepped in after Rolls-Royce went into receivership.

The nationalisation of Rolls-Royce counters the argument that state rescues are always about bailing out “lame ducks”. Heath took a gamble that the company had failed due to the unexpectedly high costs of developing a new, advanced RB211 jet engine but had a long-term future.

Rolls-Royce came through its temporary difficulties and became one of Britain’s few genuinely world-class companies. After 16 years under public ownership, it was privatised by Margaret Thatcher’s government in 1987.

And if all else fails...

Unions demand Britain stops protecting Chinese steel

Secretary of State for Business Innovation and Skills Sajid Javid.

Union leaders are going to urge business secretary Sajid Javid to stop blocking higher tariffs on Chinese steel, when he arrives in Port Talbot today.

Unite Wales secretary Andy Richards warns that warm words and PR photocalls simply won’t cut it; Javid must take action:

Richards says:

“When he meets steelworkers, Sajid Javid needs to commit to ensuring British steel can compete on a level playing field by promising to drop his opposition to higher EU tariffs of cheap Chinese steel and honour the commitments to help with energy costs which were quietly watered down by George Osborne in his budget. But most of all he needs to signal his commitment to steel and manufacturing by promising to back British steel with a line of financial support to get it through these dark days.

This crisis goes beyond Wales, Richards adds. The whole UK steel industry is in crisis.

He needs to look workers in the eye, not just at Port Talbot, but at sites across Tata Steel from Shotton and Llanwern, to Rotherham and Corby and say your government backs you. A failure to do so will leave workers feeling his visit to Port Talbot is nothing more than an empty PR stunt and intensify the need for David Cameron to take personal control in securing a future for the UK steel industry.”

Updated

It’s another morning of bad front pages for the UK government.

Both the Times and the Financial Times are splashing on accusations that Britain undermined efforts to protect Europe against imports of cheap Chinese steel.

Steel industry: UK is ringleader against China steel clampdown

Britain has been accused of deliberately undermining efforts to protect Europe’s steel industry from a deluge of unfairly cheap steel from China.

In an embarrassing development for the UK government, European steel industry has said Britain has been the ‘ringleader’ in a move to prevent higher tariffs being imposed on cheap Chinese steel imports.

Charles De Lusignan, spokesperson for the European Steel Association, has told Radio 4’s Today Programme that:

We have been talking about the lifting of the lesser duty rule in particular for a long time. The fact is that the UK has been blocking this.

They’re not the only member state, but they are certainly the ringleader in blocking the lifting of the lesser duty rule.

The Commission has been pushing to lift the lesser duty rule since 2013, De Lusignan continues, in an attempt to prevent the ‘dumping’ of steel on the European market.

The fact that the UK continues to block it means that when the government says its doing everything it takes to save the steel industry in the UK and in Europe It’s not. It’s simply not true.

Currently, the EU sets a tariff of up to 16% on dumped Chinese cold-rolled steel – a high-value product used to make car parts, household appliances and furniture . America, though, imposes fixed duties of over 200% on some steel products.

De Lusignan also insists that European steel workers are losing their jobs because Chinese steel mills are selling steel here for less than the cost of making it.

His comments echo points made to the Guardian last month by his boss, Axel Eggert, director general of the European Steel Association.

Eggert told our Brussels correspondent, Jennifer Rankin, that the UK was fighting attempts to retaliate against cheap steel from China.

“The UK is the big opposing member state and is the driving force against the opposition of the lifting of the lesser duty rule, so it would be crucial that the UK would lift its opposition.”

Eggert was also surprised that the UK, which is “often closer to the US than the EU” did not share the US view on trade defence.

As he put it:

“Why doesn’t the US have such a strong position to implement fair trade and why does the EU not have this.”

Something for Sajid Javid to answer in Port Talbot today......

Updated

The agenda: Business secretary to visit Port Talbot

Good morning and welcome to our rolling coverage of the world economy, the financial markets and business.

Britain’s steel crisis rumbles on, with no signs of a breakthrough that could save tens of thousands of jobs across the troubled industry.

Business secretary Sajid Javid is expected to visit Port Talbot today after (finally) returning to the UK from his visit to Australia (possibly with a non-too-impressed teenage daughter in tow).

Having aborted his visit Down Under on Wednesday, the under-fire Javid will be meeting with workers, managers, unions, MPs and members of the Welsh government today.

His message -- that ministers are doing everything they can to secure the long-term future of the company and steel industry.

Stung by criticism of being ‘asleep at the wheel’, the government has already started looking for a buyer for Tata UK’s assets.

Nationalisation, is seems, has been ruled out - despite the Labour Party calling for an immediate show of support for steel.

Also coming up today:

9.30am: We find how well, or badly, Britain’s wider manufacturing industry fared last month, when data firm Markit publishes its latest Purchasing Managers Index.

1.30pm: America’s latest unemployment report is published, showing how many new jobs were created in the world’s largest economy.

We’re also getting new UK house price data from Nationwide, and financial results from the Co-operative Bank.

Steel, though, is the main story today.

Updated

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