Gordon Brown steps in to help stop closure of Corus steel plant

May 9 2009 by Iain Laing, The Journal

corus

THE Prime Minister last night threw his weight behind a last ditch attempt to stop the North East’s biggest steel plant from shutting with the loss of nearly 2,000 jobs.

Workers at Teesside Cast Products yesterday learned that the Redcar plant would be mothballed after an overseas consortium pulled out of a deal to take 78% of its output for the next five years.

Gordon Brown spoke out after business leaders, politicians and unions angrily rounded on the consortium led by the Italian company Marcegaglia, which had been due to buy a majority stake in the plant owned by Anglo-Dutch steel giant Corus.

Mr Brown said: “I still hope we can keep jobs. There is an agreement that the contractors are not holding to. The workers have served the contract that they have been engaged on very well indeed.

“We are doing everything in our power to ensure that the contract is upheld. That’s the means by which we can protect and safeguard hundreds, indeed thousands, of jobs as a result of this.”

Corus said its decision to begin a 90-day consultation period to discuss mothballing the plant was “unavoidable“ because of the consortium’s decision to walk away from a 10-year deal signed in 2004. The company said it was pursuing a number of legal options after its failure to keep the suppliers from leaving. It emerged the company had been locked in a bitter legal dispute since the beginning of April, but it had failed to get a notice of termination overturned.

Business Secretary Peter Mandelson said: “It is essential that Corus does everything it can legally, and with the Government’s assistance, to reinstate the agreement.”

But Jon Bolton, Teesside Cast Products managing director, said: “The stark reality is that we do not have any orders. It will mean mass redundancies.”