National Assembly for Wales

Good morning and welcome to the Economy, Trade and Rural Affairs Committee. We're taking evidence this morning on the one-year anniversary since the announcement and the turning off of the last blast furnace at Port Talbot steelworks. It's a pleasure to have representatives from Tata Steel.

I'll just deal with the normal housekeeping that we deal with before all our meetings, and ask for apologies. We have one apology, from Alun Davies, who I'd just like to welcome on to the committee since he's the new member of the committee. I'm sure he'll be a valued member of this committee as well. Declarations of interest? Yes. Who's first? Go on, then.

Just for the record, I'm a member of the Port Talbot transition board.

In light of the subsequent witnesses, I'm a member of Unite the Union.

I'm also a member of Unite the Union.

Okay. That's declarations of interest taken care of. It's a bilingual meeting, and translation facilities are available on the headsets here, if anyone wishes to use it. It's also broadcast live. At the end of the process today, a transcript will be sent to you for your perusal. If you've got any views on it, please inform the clerks, and they'll make the adjustments accordingly. 

I'll ask you both to formally introduce yourselves, but it's good to have representatives from Tata Steel with us this morning to open the session. If I could ask the chief executive to start first and just introduce yourself and your position within the company, and then we'll go into questions from committee members.

Thank you, Chair. Good morning to you all, including the members of the committee. I'm Rajesh Nair, I'm the CEO for Tata Steel UK. Thank you for giving us this opportunity to come back and discuss where we are, more than a year down the transition that we started in September 2024. Thank you.

Good morning. I'm Chris Jaques, I'm the chief HR officer for Tata Steel UK.

Thank you, both. As you said, we're one year on. How are the developments going at Port Talbot?

Very well, Chair and Members. We're quite pleased to see the progress that we are making in the transformation, notwithstanding the difficult times that we had in the beginning undertaking this transition. Obviously, as you all would have seen, it involved shutting down some of our assets, and also making people redundant. But, having said that, I would like to believe we've dealt with it in the best possible manner, in the most responsible manner.

One year down the line, I'm happy to see the progress that's being made, especially on the project in terms of bringing the EAF online by the end of 2027, which is our target date, which means we can restart steel making in south Wales with the new technology. So far, the going has been good, and I must acknowledge the support and contribution of a number of stakeholders: in the Governments, in the community, with the unions, and with all our partners who are working with us, including the groups, both the Tata Steel group and the Tata group, in supporting it.

Most importantly, as you would have seen and read, one of the most significant milestones we crossed was breaking ground in July, about a week in advance of the target date, which gives us a lot of confidence that we are on our way to getting it all done by the end of 2027.

Thank you for those opening remarks. Obviously, 2027 is the target date to have the opening of the new arc furnace in Port Talbot. How confident are you that that date will be hit? Because I think we're all familiar with large projects potentially having a run-over date, or, if the conditions are right, being pulled forward, even. So, there are two options to look at. How much confidence has the company got to get to 2027 and be able to start using the facility to its full maximum ability? What potential pitfalls might mean you end up having to go beyond 2027 before you actually start production in the facility?

So far, the way we have moved along the project gives us great confidence that we will still hit the milestone of end of 2027 for commissioning of the EAF. As I mentioned to you, the fact that we've been able to get the planning approvals—thanks to the co-operation and support of the council and everybody else—nearly two weeks in advance of our planned dates shows how well we've been planning. A lot of work has gone into very detailed planning, and very often megaprojects fail because we haven't spent enough time at the front end of the project to make sure that we've got all the detailed plans.

The teams are working very hard to really look forward and make sure that they have all the plans, which will help us to deliver the project on time. Since the announcement, and since December 2024, we have already placed orders for nearly £400 million-worth of equipment, and a lot of equipment, actually, in various stages of construction and build-out, and we are expecting all the equipment to be arriving on site by early 2026. So, there's a tremendous amount of progress that's happened there.

On the ground, we are now getting into the phase of construction. We have some great partners in the group who are helping us manage the construction. We've been working with our contractor partners, a lot of them local, to be able to make sure that we have the right people on the ground. We are putting in facilities as we plan. A lot of demolition work has already started.

Just to give you sense, over the last four months, five months, we have moved nearly 400,000 tonnes of soil to level the ground. It is being crushed and regraded for use on the new site. A lot of buildings have already been demolished, and construction is starting up. Construction teams are being set in place, we are making a great amount of progress in that place, and very soon we will start reconstruction.

The big one is on the National Grid—we have had some great interactions with National Grid. National Grid is also progressing. Just last week, we have given them the plot of land that we needed to give on the Port Talbot site for the build-out of one of their substations. So that's progressing well, and we are hoping that National Grid will also deliver their part of the project by the end of 2027.

So all in all, it gives us a great amount of progress, but the next few months, when we start construction on the ground, that will be the test, I think, of how well we can get the job done on the ground. At this stage, it gives us a lot of confidence that we've got all in hand, but construction on the ground will really tell us how it goes. But we are getting prepared for it.

So, as we sit here today—I appreciate things can go wrong in the months and weeks and years ahead—every part of the jigsaw is coming together quite nicely, orders are placed for new equipment, and third-party contractors such as National Grid are already in the system and have their roles identified and are in position to do what they need to do.

How specific is the build at Port Talbot to the Port Talbot site? Or is it something that has been replicated at other steelworks and is literally just being dropped into the Port Talbot steel-making system? Is it unique to Port Talbot or is it very much a world concept that can be found in other plants?

The concept of an EAF working in an existing steel plant is not new, but specifically on Port Talbot, we have to take the conditions of Port Talbot, as we have said in the past. At the Port Talbot site, the construction is on a very deep brown, black site, which means we have to deconstruct a lot of the existing buildings and build inside it. So that's very unique to Port Talbot, and that's something that we have to be mindful of. That's where a lot of planning has gone in. A lot of front-end planning has gone in in terms of doing the engineering studies, the layout studies et cetera, which can help us manage the construction, which comes later, to be done very well, done to plan, and done to the schedule.

The bottom line is a lot of planning has gone into it, and this site is unique in the sense that it is a deep brown, dark brown site, so specifically a lot of planning has gone into the deconstruction and the design of the new buildings and the new equipment to fit into that. We've got a lot of technologies in play that help us to envision this or simulate it in advance. All the partners are working, I would say, on the same page in some sense to make sure that whatever we start to do when we are constructing and installing will not have problems with interfaces et cetera, which are usually the problems that happen when you start construction.

My final question. Obviously, other parts of the plant are continuing in their work. What sort of impact, if any, has there been over the construction period to date on the rest of the plant and its operations?

Not really much, because the entire site of the steel plant has been ring-fenced, and a lot of the work that's happening is outside the perimeters of the existing plant. There are some interfaces with the existing plant, which have been adequately sorted out. So, in terms of the construction work impacting the rest of the plant operations, it's very little.

Thank you. Luke.

Diolch, Cadeirydd. Just thinking on some of your answers there, it sounds like, in the run-up to at least the construction of the EAF, things are going as planned. There are a lot of things that have to come together, though, as well for when the EAF is in place. So, for example, Tata have said previously in committee that there would need to be a sustainable and secure supply of high-quality scrap. That was something that was raised by a number of experts as well throughout that period of discussions around the electric arc furnace. Where are we in ensuring that we actually have that supply of scrap steel?

Yes, Mr Fletcher, that's also another area of work that has been happening as we speak. We're working with a number of our scrap partners in the UK to secure the right supply chain. I may not be able to give you the full details because it involves commercial interest, but just suffice it to say for the Chair, and for the for the committee here, we are in a very advanced stage, in advanced stages, of work with potential partners to ensure not just a secure supply chain but also the right quality of scrap that we require for the EAF. In the coming months, or weeks, you will hear about the approaches we are taking in terms of managing the scrap supply that's required for the EAF.

So, no concerns on that front at the moment, then.

Not at this point in time.

Okay. One of the other concerns that was raised around the electric arc furnace was the potential of that EAF not being able to produce high enough quality steel for products downstream, or products on the order book for Tata. Where are we at on that?

So, with due respect, it's not about the right quality of steel, it is about the right products that you can do for the various product applications that you need. The quality of the steel depends on how you make the steel, whether you make it from scrap or whether you make it from liquid iron—it's not really an issue because you can always manage it between the main steel making and the secondary steel making. The concerns that several people had about whether it will meet the requirements of different segments—. For example, one of the segments that was talked about was packaging. There's a lot of work that's happening today, and as we speak, there's a lot of development that is continuing to happen in the space of EAF technology, and not just EAF technology, EAF technology with the downstream technologies, to be able to produce the same kinds of steel that are required for different product segments.

In packaging also there's a lot of work that is—. We ourselves have been doing a lot of work in packaging, in terms of being able to design the right kinds of steel that we will need to design when we have the EAF running. These are the internal discussions. As you probably would have heard, we have also a research project, which is known as ADAPT-EAF, which is with Imperial College, Warwick and Cambridge. It's basically a project that we have undertaken, or the group has come together—. It's to accelerate the development of technologies for packaging and automotive. But we're working closely together with the research group to help us get up to speed on some of this, so that by the time we get to start up, in 2027, we have enough knowledge, and that we are ahead of the curve, in some sense, as we start up the EAF. The bottom line is, today, the technologies in the EAF are progressing so fast that some of these concerns would be put to bed by the time we get to the place when we start up.

Okay. I'm just thinking again back to that intense period of taking evidence by this committee. Unions have told us that, potentially, there would need to be pig iron still in the mix, hot briquetted iron still in the mix, to be able to fulfil the order book. So, as things currently stand, that would be the case, but by the time the EAF is up and running, in your case, you think that we'd be in a completely different place?

That would anyway be required. In any case, the need for pig iron and—. Besides scrap, as such, as units of iron, you will anyway need other units of iron in the recipe that we will use for the future. The key thing is to be able to use the scrap as the largest element of steel making—that's the key point in our technology. Steel could potentially go to 100 per cent scrap or it could be as low as, let's say, 70 per cent scrap. So, the recipes that will be designed for different kinds of steel will be a function or will need different inputs that could be partly pig iron, and that's another area that we are working on, to be able to build a supply chain for pig iron or hot briquetted iron/direct reduced iron.

So, would that need to be imported from outside of the UK?

At this point in time, yes, because there's nobody who makes HPI or DRI in the UK.

Where would you envisage that being imported from?

Well, there are a number of people who are working on HPI. There are DRI plants in Europe, there are DRI plants in the middle east, there are pig iron plants in South America—it could be from anywhere. It's more a sourcing issue, a sourcing problem, or a procurement problem than, really, a product problem.

Okay. Thinking about, then, preparation for the workforce and workforce involvement right now—you mentioned earlier local contractors being used, that some of the workers that have had to take redundancy have been potentially scouted for future works as well—what are your estimates on how many jobs works will create at the moment, like construction and—?

Thank you for the question. It's difficult to be exact on the specific numbers, because if I could take you back to the discussion we had around how we were progressing some of the restructuring, and the discussions that we had in particular with the trade union representatives, as part of those discussions, we agreed that we would retain a proportion of the workforce. We did that through a number of mechanisms. We were also engaging some of the existing employees directly in the projects, so that they were closely involved in, actually, the construction and establishment of the new electric arc facility. So, there's a range of skills and personnel and experience that we've already retained in the business.

Alongside that, as we progress, we'll be looking at our existing talent pipelines, whether that be apprentice programmes or graduate programmes, and this year we have returned to recruiting apprentices. We've recruited 31 apprentices into the business across the UK overall. So, it's very difficult to be very, very specific, but we anticipate, in order to ensure that we are ready for the commissioning of the electric arc furnace, that any further recruitment that we would need to do would be in that six to nine-month period in the run-up to the end of 2027. So, as we get closer to that point, we can be more specific on exact numbers.

Okay. In terms of retraining, then, the workforce, how is that progressing?

If I could angle that from two different perspectives, because as part of managing the process as responsibly as we could, we've been able to effectively redeploy or reappoint up to nearly 600 people across the business that would've otherwise been impacted by, potentially, compulsory redundancies. So, we have a number of people who have moved roles, have moved operating units, and in some instances have moved sites, for example between Port Talbot and Trostre, in order to be able to train on new activities.

One of the reasons we've wanted to ensure that we have retained through other mechanisms, whether it be through the furlough arrangement or whether it be through engaging people directly in the project, is that as that construction and commissioning of the plant moves further and closer to becoming a reality, the people themselves are developing, alongside the original equipment manufacturers, the actual training materials and are becoming equipped themselves with the experience that's required.

In addition, in the interim, we will be having a number of people who will be visiting reference plants, because there are other electric arc furnace facilities where people will be able to become familiar with the operation of electric arc furnace. That will be both in this country and overseas.

Okay. I'm just thinking about the workforce and the agreement that was struck with the UK Government around the funding that they would put forward for the electric arc furnace. Part of that was that Tata would employ 5,000 people across all its sites in the UK. How long is that commitment going to stand for?

Do you want me to take it?

Yes, go ahead.

If I put into context where we are today, we are currently employing just under 5,900 people. When we made the announcement, we had just under 8,150. And you may recall that we announced that we would anticipate, across the full duration of the transition, that there would be approximately 2,800 reductions. To date, I can confirm—and these may be slightly different numbers than you've had in other committee meetings—the latest numbers are that we've had 2,255 people who have now left the business. A significant proportion of that has been through voluntary redundancy. So, nearly 1,400 of those changes have been delivered through voluntary redundancy. And I'm pleased to be able to say that, whilst we've wanted to absolutely minimise the number of compulsory redundancies and avoid them where we can, out of that over 2,200, we've been able to keep the compulsory redundancies down to around about 120. And that is through the efforts of everybody that's been involved in that process, including the improved conditions that we negotiated and discussed with the trade unions, which meant that people were able to come forward to volunteer.

Okay. Specifically, though, on that commitment to continue to employ at least 5,000—how long is that commitment for?

Well, if—. Sorry. To answer your specific question, if you go from the announcement that we said about 2,800, we anticipate that the business will be approximately 5,300 at the point that the electric arc furnace fully commissions.

Okay. Just, finally, a few questions from me on more recent news. I'm sure you were expecting some questions on what's been announced through the European Union. What actions would you like to see the UK and the Welsh Government take now in response to some of these announcements on the tariffs into the European Union? You know, we know that steel from Wales, in particular—its biggest market is the European Union. What action would you like to see the UK Government and the Welsh Government take?

Yes, indeed. Thank you. The recent announcements are difficult ones, yes. And the first thing that we would—. We are urging the Governments and we are in discussion with them. Firstly, we need to really understand what exactly—. I mean, there's a lot that we need to understand in terms of how the entire announcement and how the quotas and how the over-quotas will work. So, there's a bit of detail that we need to do in terms of what would happen in the future in terms of the specific quotas for individual countries who are importing or exporting into the EU. What we know today is that the overall import quotas into the European Union are being slashed substantially and they are going to be having quotas—country-specific quotas or caps. That's all we know. But how each country would play into it is something that we will need to know, and how, then, the quotas would apply to different categories of products is also something that we need to be clear about. But having said that, the first intent would be to work with the European Union, as one of the biggest trading partners with them, and to work out preferential treatments—since we have been long-time exporters—preferential treatments and concessions into the European Union. That's the first one. And the second one is: in line with what the EU has done, the urge is that the UK also needs to start looking at or designing the new quota systems or the safeguard systems that it would like to put in place, similar to what the European Union has done, to make sure that we are able to manage the imports into the EU.

The European quotas, just so that we all know—. The UK quotas are significantly disproportionate to the demands of steel in the UK. These quotas were set up—. Particularly in flat steel, in which south Wales is really a significant player. These quotas were set up in 2017-2018, when the demand for steel, flat steel, in the UK, was nearly 30 per cent higher than what it is today. The demand has declined, the quotas have remained where they are, and the quotas, in some cases, are between—. The quotas, in general, across different categories of products, are between 70 per cent on one end to up to 140 per cent of the demand in some product categories. So, that’s the fundamental ask of the Government, to look at our safeguard and quota systems, to ensure that we have a level playing field where the domestic producers are able to ensure that they have better access to the domestic markets.

Even before the announcement in the EU, the quotas in the EU for different categories of products were between 15 per cent and 30 per cent of the demand of those respective products in the EU. With the implementation of this new action, it would further drop from that level. At an overall level, the quotas were about 30 per cent of the demand in Europe. In the UK, as I said, it was anywhere between 70 per cent and 140 per cent. At an overall level, in flats, about 65 per cent to 70 per cent of the demand in the UK was the quota size. So, we need to do something about the safeguards and the quota.

So, these are the two primary areas. The first one is to get the work on the concessions and special treatment as we navigate. The second is protect the UK by its required quota system.

Diolch, Cadeirydd.

Just on that point, do you have confidence that the UK Government is abreast of all that you've just said, especially the second point about protecting the domestic market?

Yes, I think, based on the discussions we have been having over the last, let's say, few months since the US started off on its trade barriers, we've had some very constructive discussions and, in fact, with the announcement in early July in terms of what we could do with how the existing quotas were accessed by different countries, I must commend the Government in terms of taking those actions, in terms of limiting the access to these quotas by specific countries who have an opportunity to dump steel. Also, in terms of how the quota is liberalised every year, because that was part of the original agreement of quotas, all of those have been substantially slashed. So, there is a lot of intent and, in fact, the announcement in July was that intent converted into action. The key thing is, as we see now, the trade situation is becoming more and more difficult and things are moving pretty fast. So, one of the expectations is that we need to bring pace into it in order to make sure that we deliver some of this.

But I am reasonably confident with the discussions that we are having that the Government will also look to do things that are very similar to what the EU has done—on the one hand, to protect the UK domestic market, and, on the other hand, working with the European Union to make sure that we have the right trading interest between the two groups, the two blocks, let me say. The EU also is a significant exporter into the UK, so it's in our interest to find the right place for the EU and UK to do business, especially in steel.

Thank you. Jenny.

Obviously, we're no longer a member of the European Union, so this, potentially, poses an existential threat to our industry. Tariffs, in the last year or so, have become an instrument of foreign policy. The unions are saying, clearly, or some representatives of the unions are saying the country that is last to impose tariffs is the one that will be totally eliminated. So, how do we protect the steel industry in this country, for a whole variety of reasons? Without steel, we can't develop as a manufacturing nation.

Yes, you could look at it as an existential crisis, or you could look at it as an opportunity to make a difference. And I think the conversations that are happening today is how we can convert this into what would work for the UK. The trade restrictions, the trade battles have now become the norm. Protectionism, particularly in steel, has become the norm. So, we've got to find our own ways of managing the domestic market and managing so that the domestic producers can exist in the system.

The quotas that we are talking about, technically, are maturing or ending in June 2026 legally. So, it’s between now and June 2026 that these quotas will end, and the quotas will otherwise, as for the World Trade Organization, expire anyway in 2026. But, on the back of some of these actions from different countries, there is a need for us to accelerate the changes that we desire, to be done quicker. The intent needs to be there, and the necessary indications, in terms of the direction the country wants to go, should be clear upfront so that we know what we are headed into over the next few months.

I think the bottom line is that there are adequate discussions that are happening with the Government. The Government and the various departments are engaging proactively. There are a lot of conversations happening on the state of play. There are a lot of conversations happening in terms of the impact both ways, in terms of what the impact is in the domestic industry, and what impact it has in terms of our ability to export into other markets. I’m hoping that, over the next few weeks, we will come to a place where the Government will be able to take a clear view on how it wants to approach. But, like I said, like all countries that have erected quotas and created walls, the UK will also need to do something to protect the industry, and I’m hoping, given the urgency of the situation, that it will happen sooner rather than later.

Okay. So, the top three things you'd like the Welsh and UK Governments to do in light of this latest threat—

The first one, as I said, in this case, engage with the EU to make sure that the trade is considered. The second one is to work with all the stakeholders to understand the real quotas that we need to put in place in the short term. The third one, which is a bit more long term, is that, ultimately, the steel industry, and any industry, will flourish only if we create demand for the product, and, therefore, we come back to the conversation around how we improve manufacturing and how we improve the consumption and demand for steel, which means we come back to the basics, which is where we’ve been talking about having a strong industrial strategy, and then underpinning the industrial strategy you have a strong steel strategy, because any industrial strategy, if it drives manufacturing, as you’ve said—and steel is imperative to be used—that will follow. So, having a co-ordinated, comprehensive steel strategy that underpins the industrial strategy, and converting the industrial strategy now into concrete actions that will enable us to see the benefits over the next few years are critical, so that you can increase the demand and consumption of steel into the future, which then gives us an opportunity to expand the steel industry into the future.

Okay. Just reflecting on the transition that we were talking about earlier in the conversation, Sweden started having a strategy for green steel transition back in 2015. So, what would you say to the argument that, actually, the work of the transition board started far too late and should have involved the workforce at a much earlier stage?

I think the transition for the steel industry to move to a sustainable, circular one depends a lot on the local geographies, the local situations, et cetera. So, different countries, different geographies will need to adopt their own strategies in terms of how we move on, with the common objective being that, at a certain point in time, we will need to get to zero carbon, or very low carbon circular steel. Because steel, inherently, is very asset heavy, we can't have one-size-fits-all, and, therefore, when it came down to the UK, the strategy we have chosen for ourselves, which we discussed two years ago when we were getting into this transformation, was evaluated and assessed based on the conditions pertaining to or local to the UK geography in terms of what works well, while making sure that we can meet the future requirements of the customers of steel, making sure that we are finally getting down to a place where we are actually saying that it's green steel with a very low carbon footprint. And, more importantly, while we all talk about carbon, carbon dioxide and sustainability, the other big piece in this is circularity. It’s how do we continue to use the resource, the materials, again and again so that we reduce the impact on the environment. And given that we had chosen this approach, the approach to—. The point at which you start implementing it would depend on a number of factors like business factors—where we are with respect to the assets.

Okay. Let's talk about Port Talbot.

The conversation around Port Talbot started, let's say, in 2016-17. It was very clear that this kind of transformation requires not just the co-operation, but also the support of the Government, which we have seen in every geography. It has taken us that long for us to get the transformation to be supported by all the parties. But having said that, once we got there, we then moved pretty quickly once we signed off on that, from 2023 to 2024. So, what we're trying to do is to speed it up. The good thing that has happened is that, when we knew of the transition, the transition board was set up as an outcome of the reflections of similar transitions or similar restructuring that had happened in the past in the UK, in other places in the UK. So, in order to manage it, this transition board was proactively set up by the Government and with support from Tata Steel to make sure that we handled the transition well as we moved, particularly focused on the people who were going to be affected by the transition.

So, in terms of the timing, as I said, it was a function of where the business was and where the assets were. In terms of the transition board being set up, I would like to believe that, once we had the transformation signed off, the transition board was set up at the same time to ensure that we worked together to take care of the people who were affected. So, in a sense, the timing was probably right.

Okay. I think that my colleague wants to just come in. 

Yes, Hannah's got a supplementary.

Thanks. Just picking up on those points and the timing of the transition board, I think that the challenges of the sector shouldn't have come as a surprise to anybody, so shouldn't the transition board or that work have taken place years before rather than when we reached crisis point?

The remit of the transition board and the function of the transition board was very specifically to take care of the fall-out of this transition, which was focused on the people who were being affected by the transition, and also to help—

No, I understand why that transition board was set up and what it was set up to do, but my question was more: shouldn't this work have been done earlier, considering what needed to be put in place to support the workforce and manage a more just transition?

But you wouldn't probably set up a transition board, Ms Blythyn, without being clear about what the transformation or the transition looks like. So, the transition would have been—. The choice of the technology and the choice of the transformation that we were undertaking to move the steel industry in the UK to a different place came about in the last few years. Do you want to—?

Okay. So, I understand—

I think Chris wants to come in.

Sorry, if I could just add, because I understand the question in terms of the timing, the origins of the transition board were first set up under the previous UK Government, and then its terms were revised with the change in UK Government and some of the structures and facilities that supported it. In terms of the main focus of the transition board, it was there to help people who were impacted either directly as employees or in the supply chain in the wider community. The transition board, in reality, was starting to meet six months before the first set of redundancies actually took place, and has sat regularly and has had various work streams that have supported and brought the right parties together, whether that be UK Government representatives, Welsh Government representatives, the councils, the unions or different stakeholders. It has brought people together, in addition to providing the various funds to support people all the way through. And actually, I would say that, overall, it's been a very positive process. And if you look at the impact of the transition board and the outcomes, for such a significant change, particularly in the one location, I think, through the efforts of the £20 million from Tata Steel, as well as the wider £80 million from the transition fund and all the various activities, it's taken very positive steps to support people who have been impacted through the process. And it's fitted quite well from a timing point of view in terms of as people have left the business or have been impacted.

Okay—

Sorry, Jenny, just very, very briefly. I appreciate that response. So, obviously, we're focused on the transition board, the transition board itself, rather than the need for transition more broadly. So, did Tata have a transition plan in place, or had it considered that prior to us reaching the point that we did a few years ago? 

Yes, as I said, as a company, as a corporate, we evaluated this transition plan, which involved changing, shutting down the blast furnaces and going down to new steel making. I'm not getting into why that approach was chosen, and we've discussed this in the past. This has been in the making for the past, I would say, seven, eight, nine years, and that came from the fact that, as I said, despite declining demand for steel in the UK, and the fact that the steel industry, as such, was on the decline in the UK, it's the commitment of the group to be in the UK, in the geography.

For us to have then worked on a plan, that would have required us to spend nearly £1.25 billion on this, just this transformation, which is about changing the technology, but, when you look at the transition from the time that we've been looking to work on this transition to the time that we would have delivered the transition, the total cost of doing this is significantly more than £1.25 billion, because the business itself in the UK is not structurally viable, financially viable. So, the cost of the transition itself is nearly £4 billion, £4.5 billion. So, this transition has been worked through all the way from 2016, 2017, on the back of the commitment that we need to be in this place and continue to make steel here. And the choice of this transition was based on operational factors—on what we need to do with our customers, on the costs it takes to do it, on the returns you would get, on the futureproofing of these technologies into the future. And it has taken us that long to get the transition implemented. So, as I said, the choice and the timing would be dependent on where each of the steel-making facilities are, or the steel businesses are, in the respective geographies. I hope that kind of clarifies.

Okay. Nobody's arguing that there isn't a need for change. I think the issue is, really, how successful the transition board has been at actually enabling people's undoubted skills, who were being let go—how those skills have been retained within the green economy and all the expansion that we want to see in green industries. What's your assessment of how successful we've been in ensuring that people who have the skills, which is why they were working at Tata, have been reallocated into jobs that build on those skills?

In terms of the broader question around not only our employees, but the wider supply chain, I would suggest that the specific details of the impact on everybody that's been supported through the transition board needs to be provided from other parties of the transition board. But, from my perspective, as I mentioned earlier, I think the transition board has been a very positive process. It has provided an opportunity for all the relevant parties to come together. It's committed a number of important funds, which have been able to help people in different ways. The direct support to employees within the company who have been impacted—. As part of the Tata Steel commitment of £20 million, we’ve provided professional independent outplacement support, onsite counselling, we’ve offered retraining of people, re-accreditation of existing skills. Our most popular programme that's been put on, by far, has been all the pension awareness and pension briefings and pension guidance, and I think that aligns very much with the number of volunteers that have come forward, because, with all changes, sometimes the change fits well for people’s changes in circumstances. I think what we have seen, certainly from an employer perspective, is that because we announced and commenced the consultation in January, February of 2024, but the first people didn’t actually leave the business redundant until the August, September period, actually, people had had quite a lot of time to be able to start to take advantage of the different support services, whether it was those provided directly by the company or separately by the transition board.

In addition to the transition board, there have been associated activities, and I would call out specifically the union-supported community hub facility directly within Port Talbot, which has been a fantastic facility for people to be able to get very easy access to support services. Indeed, the Tata Steel UK regeneration business, UK Steel Enterprise, we based ourselves in there, and, from there, we’ve been able to disperse a further £3.7 million to support over 90 projects, which have created over 400 jobs across the south Wales corridor. So, from my point of view, what I see and the feedback I get from people that interact with the transition board has been positive.

Okay. There are two things here. One is the needs of individuals, and obviously you have to meet those—we have to meet those needs—but the other is the strategic passporting of those skills into other, green-related industries. So, do you think that we've managed to avoid the problems that we had at Redcar, when most people ended up on much lower pay in the retail industry, rather than using the industrial skills they had?

From the visibility that I have—I don't have full visibility of all the people that are impacted in the supply chain, but from the visibility that I have—yes. And what I would say from my experience, because I used to be employed in the north-east of the UK, is that the support that was made available through the transition board was much more readily available to this transition than for the impact of the changes that took place in Redcar.

Okay, thank you. That's very useful to have on the record. My last question is: there's quite a lot of concern—in Wales, anyway—that the UK Government treated Port Talbot differently from Scunthorpe, and obviously the UK Government passed emergency legislation to keep the blast furnaces open. What would have been Tata's response if they'd done the same for Port Talbot?

I think—. I'm not sure I have a critical response in terms of whether the Government did something different in Scunthorpe versus us. As far as we are concerned, as I said, we had a clear transition plan, which we'd been discussing with the Government, and we were able to get the Government to participate in our transition plan for the future, for the next few years, to create a viable, sustainable steel business in the UK. So, as far as we are concerned, from Tata Steel's point of view, the fact that we had a viable plan, that we had a clear plan, the fact that we had been discussing with them and we had, in some sense, participation and agreement, and we had made the plan work for all of us, so we were anyway on our transition—. Scunthorpe is a different story, and I would refrain from commenting on whether the Government could have done something different there, or whether we could have different—. As far as we are concerned, we had a plan which the Government was party to, so we went ahead with that plan.

So there was no discussion about including Tata in Port Talbot in that emergency legislation?

No, we had nothing to do with that.

Thank you.

Sam.

Thank you very much, Chair. Looking at the future opportunities that exist for Tata and Port Talbot, obviously the Celtic Freeport, adjacent to the site in Port Talbot, what discussions are you having about the opportunity of future steel making from EAF being involved in some of the projects linked to the Celtic Freeport?

As part of the grant funding agreement with the Government, we have agreed that, as part of the funding or the grant that the Government is giving, we will make available a certain portion of land for the purposes of future development and further activities. We stand committed to that.

At this point in time, as far as our assets are concerned, we are in the process of—. Having shutdown, having made them safe, now we are in the process of keeping them safe, because there are structural elements. We are also in the process of meeting our obligations—environmental obligations, permitting obligations—because we have been running a site that has its necessary permits and licences. So, we are working with the council and the regulators to make sure that they are properly discharged.

As we move forward, we are working anyway with the Government to make the commitment on the land that we need to be making available. So, in the process, we will have more clarity on what land is available for future businesses who want to come to site. There are people who have expressed interest to come onsite, so we are engaging with them, and, at an appropriate point, since the Government is a participant in this, we'll work to make sure that these are appropriately discussed and handled—the same with the Celtic Freeport and with all other partners who want to work with us.

So, you're content that, where things are at the present, there's no direct project being made in Port Talbot at the moment through the Celtic Freeport. There is in the other part of the free port, in Pembrokeshire. But you're content, if opportunities were to arise, that Tata is well placed to have those discussions, understanding the individuals involved, where those opportunities lie, to see if the steel from the EAF is applicable towards potential projects, or sites available around the Tata site are there for future development.

Yes, certainly. As we move forward, we will work with all people who are potentially interested in using parts of the site to work and deliver their own business. And, as far as the EAF is concerned, once we start making the steel, that steel is available for everyone to use in their respective applications.

Thank you, Rajesh. In terms of the wider £2.5 billion available from the UK Government for the steel industry, have you had any further discussions with UK Government counterparts, either through the transition board or directly with Secretary of States, on accessing any more of that money for future developments around steel making at the Tata site?

So, Mr Kurtz, at this point in time, we are focused on delivering the current investment, which itself is a very large investment, not just in terms of the money, but in terms of what we are constructing. It is not just the EAF. You will recall, besides the EAF, we are also setting up a brand-new pickle line. So, that's also a very large project. It's about £200 million. We are also upgrading the casters and the hot mills. So, there's a lot of commitment from our people in terms of delivery. So, that's what we are currently focused on, and we are focused primarily on making sure that this project is delivered on time and in cost, so that we can start 2028 and be able to deliver the steel that we have promised to our customers.

Once that is done, and as I've said in the past and we've discussed it here, the opportunities for tapping into the fund will fundamentally depend on business cases for those proposals. As long as there are business cases that are there that can help the development of new steel projects, at that point in time, we will surely look at that.

Fab. Looking back at the answers that you gave the Chair in opening about the progress that's being made, which is very welcome, what could be potential roadblocks for this development? I'm looking at continental Europe and ArcelorMittal and their rowing back of investment in electric arc furnaces. Is the cost of electricity to deliver this—? I know you're talking about the stakeholder relationship you have with National Grid. Is the cost of electricity, which in the UK is higher than in continental Europe, is that a concern for you in delivering this project or the viability of the project going forward?

So, there's a piece around delivering the project, which is about the physical delivery of the project, and I think I've mentioned where we are, and that'll continue. So, there'll be challenges with physical delivery of the project, which we will have to deal with as we move forward, as we get into the construction phase. But the point I think you're making is more about the viability of the business and the viability of the steel business into the future—

The running costs, yes.

So, that's where, I think, the larger point around creating the right environment for bringing in more competitiveness into the steel industry is vital. And a key element of competitiveness for industry in general and for the steel industry in particular is the cost of energy and the cost of gas, as well as electrical energy, and there are conversations that are happening today with the Government in terms of how we can, first, make sure that the energy-intensive industries are able to get energy at the right cost, at the right price, so that you can remain competitive. In this case, we are comparing ourselves with our nearest peer, which is the European Union, where we are at a disadvantage. So, that's a conversation: how can we make it more competitive? The other larger piece of discussion is how, in general, energy can be made more cheaply in the country while also going green, but that, I think, is a larger discussion within the country on how we can make electrical energy cheaper.

You said that there were discussions being had with Government—are Tata involved in those discussions?

Yes, indeed.

They are. Thank you, Rajesh. Thank you, Chair.

Hannah.

Thanks, Chair. I'm conscious of time now. We've focused on what's happened and what's happening now, but before we close the session, I want to turn to next steps. The UK Government's steel strategy is due to be published by the end of this year. What do you hope to see in it and how likely do you think that what you hope to see in it will be included?

I'm hoping that the steel strategy will be published by the end of the year. The essential elements of what I expect to see in the steel strategy are fundamentally around how the steel strategy will help develop the steel industry to support the wider industrial strategy. Because having a steel strategy by itself to grow the steel industry doesn’t make sense if it doesn't grow demand for steel in the country. So, it needs to be very strongly tied up with the industrial strategy.

Therefore, elements in the steel strategy that I expect to see, firstly, are about competitiveness, for sure: how do we have elements in the steel strategy that will enable competitiveness of the industry? The second is elements that will create a level playing field for the industry, particularly now, when protectionism is increasing. The third is how the steel strategy supports the sovereignty, which means things like how it brings other elements of the supply chain, like scrap et cetera, into the picture. The fourth element is how we encourage the use of domestic steel within, hopefully, the growth that we would like to see as part of the industrial strategy in manufacturing. These are a few pieces that I would like to see in the steel strategy. And finally, what kind of a role the Government would like to play, for example, in terms of developing the steel industry to become more sustainable and circular in the future—the public-private partnership, which can be expanded. So, these are the few elements, Ms Blythyn, I would like to see.

Thank you. You touched on, as well, the level playing field. Would you see that in, perhaps, further energy prices to deliver parity with the lowest cost European producers? Have you had any discussions with the UK Government on that specifically?

Yes, indeed. I would like to put the energy on the competitiveness piece. When I talked about a level playing field, it's about the playing field in terms of trade barriers and everything else. Yes, we have had a number of discussions with the Government and with the Government departments on what we could do to help the energy-intensive industries, and in particular the steel industry, to access lower cost energy.

I was going to try and finish on a positive note. I think earlier in the session, you spoke about your return to recruiting apprentices this year. And I think you said 31, and that's not just in Port Talbot, Llanwern and Trostre and in the north Wales, in Shotton, as well, and I have seen some of the press coverage about it, and that's good news. Is that something that you'd want to be included in a strategy around actually how we bring people through into the industry and make it more attractive, but also making sure that we are working with those educational institutions to ensure that we've got the skills we need in the future as well?

I would always encourage the investment in skills. There is a lot of discussion around green skills. But if you look at a lot of the capability and competence that people need, whether you are welding on an offshore windfarm or welding in a steel plant, it is still ultimately welding. There are some core vocational skills that the country desperately needs, and anything that we can do to ensure that we've got the right infrastructure to be able to support the development of those skills—. And alongside developing those skills, then that encourages employers and other employers to be able to come into those areas, where we're confident that they've got a pool of skills to tap into.

Sorry, I missed one point on the other thing, which is important, which is, while we've talked about skills, the other big piece that we're looking to see in the steel strategy is how do we kick-start innovation and training in steel-related faculties. I think ADAPT-EAF, which we spoke about, is a great example of how we have brought together academia and industry to solve the real-world problems of the new technologies while remaining sustainable and circular. So, this piece around bringing more innovation, bringing more focus on education in these skills, metallurgical areas, the new technologies in automation and analytics et cetera is key, and to orient people towards manufacturing and suchlike activities would be an important element of the future sustainability of industry in general.

Thank you for your evidence this morning. It has greatly helped the committee members understand what has been going on over the last 12 months. Just one point I'd just like to pick up on, when we were talking about the tariffs and the European Union—there's been much talk, obviously, of the dependency of the UK market on the European Union; I think 78 per cent of our exports go to the European Union—you touched on the point that, actually, the EU exports a lot of steel into the UK market. Have you got any figures that you could share with the committee of the quantum that we're talking about there?

Yes. I don't have them to hand, but we could send that across to the committee in terms of what the EU exports into the UK.

That would be really helpful, because we're seeing one-way traffic at the moment. To understand that from the EU's perspective would inform the committee's deliberations.

Sure, we'll get that to you.

Gentlemen, thank you for your evidence this morning. A transcript will be sent over to you for you to have a look at. If there are issues in that transcript, if you don't recognise comments attributed to you, please raise it with the clerk. Otherwise, that transcript will stand as a record of your evidence to the committee. I wish you well. Thank you very much.

Thank you, Chair. Thank you, Members. Thank you for the opportunity, we really appreciate that.

We'll now go to a commercial break while we change the deck chairs. We'll invite our next panel to start at—. It's at 10.40 a.m. that we'll be starting. Thank you.

Welcome back. It's the now second session of our inquiry, 12 months on from the closure of the final blast furnace at Port Talbot. It's a pleasure to welcome the trade unions into our second session to provide evidence to the committee. I'll ask you formally, if possible, please, to introduce yourself and your positions within your respective unions for the record. I'll start with you Alasdair and work down the line, if that's all right, and then I'll go straight into questions. 

Good morning. My name's Alasdair McDiarmid, I'm the assistant general secretary at the Community trade union.

I'm Jason Bartlett, acting national officer for Tata Steel UK.

Good morning. Tom Hoyles. I am an acting senior organiser for the GMB in Wales.

Just before I ask the question, the microphones do come on automatically, so you don't need to press the buttons.

You heard the first panel session that we had with Tata Steel. For consistency, I'll ask you gentlemen the same question. How has it gone onsite since, obviously, the closure of the final blast furnace? And in particular, do you have any observations you'd wish to make on the start date of 2027?

I'll start, perhaps. It's been an extremely difficult period. I don't think there's any question about that. We're not where we wanted to be. All of the trade unions thought that there was the possibility of a more gradual, phased transition that would have protected jobs and primary steel making for longer. But we are where we are.

The spades in the ground event when the chairman visited from India to mark the start of the building of the EAF was extremely important. As I say, we're not where we want to be, but the reality is that this is where we are. Those blast furnaces are not coming back on, whatever some irresponsible politicians might want to suggest. So, it's really important now that we move forward. We consider where we are now to be the base level. We've had our job cuts. We've had our restructuring. We don't want any more. We won't accept any more. What's important now is to grow and build for the future, and that means investing in new jobs and new assets.

Unfortunately, we're not seeing that. It has been a very difficult period. Despite all of the restructuring, we're still losing a lot of money. It's very disappointing to us that some of the commitments that we were given by the company in the discussions and negotiations we had around the closure of the furnaces haven't been delivered—really important investments that need to happen to give us a chance of a sustainable future. So, it's very important that we see some confidence in the future. Government's got a massive role to play. Obviously, Tata needs to deliver on what it said it would, but it is tough—very, very tough.

There are two sets of people we represent, of course. People who've lost their jobs—it's very difficult to see what's happened there. But for the people who remain in the works, it's really important that not just the electric arc furnace project moves forward, but we see major investment in new lines and a start to bringing new jobs back to the area.

Thank you. Jason.

Yes, an observation from my part is the fact that most of these people within the steel industry are long time-served employees. This isn't the first time we've gone through changes in the steel industry, although this is the most dramatic time and effect that it's had within Wales, because the steel making in south Wales was the last steel making in south Wales. So, going forward, that transition, even though it's taken a long period of time to get to where we are, and it wasn't our first way of transitioning to the green steel, we've had to take on board what we have got. And once the blast furnaces went off, we knew they weren't coming back on and we had to do the best we could for the people that are still there and obviously the people that have left the business.

Tom, fresh from your radio appearance this morning.

I'm glad someone was listening. [Laughter.] And I'd keep that to BBC Wales as well: I'm more than happy to speak about other things than steel.

So, I think there are two bits to this, aren't there? Following on from Alasdair and Jason, it's been extremely difficult. I think you can see—. You will all have met people from Port Talbot, you will all have spoken to some of our members who work in Port Talbot, but the wider community as well. There's obviously a lot of anger at what's happened, but, in one respect, that is done. However, the bigger questions around Port Talbot and British steel making remain. We've seen, with the announcements in the last few days, it is a very, very volatile sector. All the issues that we raised at the beginning of this process, when they looked to close the blast furnaces, are still there. So, for us, it's about making sure that we all come back together, listen, and work together to drive this stuff forward, because this problem isn't going away in the short term. So, I think, from our side—and I'm sure the guys will agree with this—there's a new emphasis to make sure we can build a plan, after all the pain, that works for everybody, going forward.

Alasdair, you said in your response that commitments that had been made to you—collectively, I assume, not just your union—have fallen by the wayside since operations began on the reconstruction on the site. Can you give the committee a couple of examples of where you were given a commitment—and if any of you have got similar observations for the committee—of those falling by the wayside?

Yes, I can. A range of commitments were given to the unions through the discussions we had around an agreement relating to the closure of the furnaces. Of course, some of that was redundancy enhancements, training packages, and so on. But a really important, crucial part of that, from our perspective, was commitments on future investment. We need to see that Tata—. They don't want to invest because they're losing money, but, of course, that's a vicious circle. That's what got us into this problem that we're in in the first place: decades and decades of underinvestment in the steel industry has made us uncompetitive internationally. Particular investments that we want to see, and we believe the company committed to, include a new galvanising line in Llanwern, upgrades to the facilities there, upgrades in Port Talbot as well, and a commitment to look in detail at a range of different investments, including upgrades to Trostre and Corby, and some of the other sites as well.

So, all of those commitments have gone by the wayside at the moment because the company is so focused, obviously, on the losses, and really the only investment we're seeing is the investment in the electric arc furnace. Maintenance is an issue as well. So, we're concerned that we're not doing what we need to do to rebuild and take advantage of the massive opportunities that we know we have, because we're down to 32 per cent market share in the UK. It's shocking; it's a historic low. So, there are massive opportunities there, but if we don't invest, then we're never going to be able to take advantage of them.

Gentlemen, do you have anything to add?

I think only for the—. Just to add to Alasdair's point, if you've built the electric arc and the transition to the green steel, once you've got that up and running, if you've not invested in the downstream businesses, going forward, you've got a supply of steel that you can't use because your assets further down haven't been invested in for years and years. My background is Trostre, packaging—I worked there for 36 years—and there's been no major investment there from the days of Ebbw Vale. When that closed, they moved the electrolytic tinning line 6 down to there, lift and lay, and that's probably the last serious investment that's gone into a downstream business. So, you can have all the steel ready, but then you can't action it.

Tom.

I'm fine with that.

The workforce that is involved in the construction on site at Port Talbot at the moment, is it very much a local workforce, or have they brought quite a few contractors in with specialist skills to obviously deliver the project on time and on budget?

Well, that's a very good question. We've been asking Tata to give us some details on where those workers are coming from. I think it's fair to say we're not happy about how that's gone. Commitments were given at an early stage that in excess of 90 per cent of the contractors that would be brought on to work on the furnace build would be local, and that there would be a strong preference for redundant workers in terms of filling those positions. Now, that's not happened as far as we can tell. We haven't had that breakdown from Tata, although we've asked for it. But there is a suggestion now that, essentially, it's up to the contractors to employ who they wish, and that is absolutely not acceptable from our perspective. A lot of workers were displaced. There are a lot of people who need work in the local community, and they should have first opportunity for those positions, and it's certainly not clear that that's happened.

And that would be your experience as well, gentlemen.

Within the current contractor population within Port Talbot, a lot of those companies have served notice to their employees—somewhere like the Harsco Metals Group, which used to do all the scrap; you've got Monolithic Refractories Limited, and you've got MII Engineering. Also Skelton-Thomas Engineering has just served notice; they started a consultation on Monday for over 100 jobs. These are people who have been contracted to Port Talbot for long-time-served contracts. Now, it would be our understanding that these people are part of the fallout that should automatically, I believe, be part of—. They've maintained this site for the last 50 years, so to bring—. You will have to have certain people come in for a certain skill because we've never built electric arc in Port Talbot, so the skill base there won't supply that.

Just to add from a GMB point of view, in one respect, most of our members went under the voluntary redundancy, so they didn't go through compulsory redundancy and so they went at an earlier point. We've pretty much seen them all go to Hinkley Point—that's pretty much it. So, in terms of displaced workers, I couldn't really say, because our members didn't go into that. So, how the rest of that workforce looks, apart from what Tata are not telling us, again, we don't really have an inkling into that.

What I will say is we are glad it's being built under NIKE, that's a huge step. But, of course, we don't want to see—. And we made this point at the beginning of it all, obviously: it is new technology that's coming in. At the beginning of the conversations about Italian workers, et cetera, coming in to build this stuff from what they've built before, we want to see as many of those jobs given to people either directly pushed out of Tata through the redundancies or those people linked to the local area.

And just for clarity in my own mind, Alasdair, you said the commitment at the outset was that 90 per cent of the workforce on the arc furnace project, I'll call it, were to be local employees. Is that correct?

Yes. That, I understand, was the ambition that Tata communicated through the transition board at an early stage, yes.

Okay, thank you. That's helpful. Luke.

Diolch, Gadeirydd. If I could just start, then, with asking the panel: what are the key lessons do you think need to be learnt from this transition in Port Talbot?

Well, that's a—

How long have you got?

That's a very—

Fifty minutes.

That's a very big question. I think the No. 1 lesson for other industrial transitions is that a successful transition cannot be forced upon people; it needs to be managed and progressed on the basis of consensus. Ultimately, the technology road map was not one that had the support of the workforce, and it's created a lot of problems pushing forward with that agenda, without the buy-in of all stakeholders. And when you're in a situation like that, when working people feel that decarbonisation and transition are being done to them rather than with them, then you have massive problems politically, and I think we're seeing that in south Wales.

It's easy for people to suggest that there are easy answers to very, very difficult problems. But when you have a situation as difficult, as complicated and as consequential as the one that we've had to deal with in Port Talbot—and the downstream sites as well—over the last couple of years, it's absolutely crucial that it's done in a collaborative way and that you find a way forward that everyone can sign up to and support, as difficult as it may be. Because it is very difficult, we know that, but there was a better way to do it.

Anything to add? Jason.

Only that I observed, in the previous slot, that Jenny had made the point about the Swedish transition taking seven years. Where Rajesh had said that this was in the pipeline for time previous to when it was announced, then I think it wasn't done in a way that would have pacified the workforce. It seemed that it accelerated the process before, you know, we were discussing things about planning, who was supplying the electric arc—none of that information was coming forward. Well, how can you set a transition board up to transition if you don't even have that information? So, it was the workforce—. Again, I reiterate: this isn't the first time for us to transition and make the steel industry a successful place within the UK, but they didn't engage with the people that would have that background.

So, on that point that Rajesh had made around the thoughts around transitioning being in place long before we even got to this point, you don't feel that that was communicated at all, do you? Is that fair to say?

Yes.

Yes. Okay. Tom.

Well, I mean, there's a book to be written on this, isn't there? And I'm sure someone will write one one day on it. But, I think, in the immediate term—. Because for some of the stuff, it's just too early to tell exactly what the outcomes will be. And we still think, unfortunately, a lot of the stuff that we predicted at the beginning will come true in terms of like-for-like job replacements.

I think the two things that are probably true at this stage are that, in terms of a major part of our industrial strategy, which steel is, whether that's in a formal document or not, the lack of leadership for the last however many years led to this point, and that is something we cannot let happen to this sector again. Obviously, the UK Government's putting forward a steel strategy; I'm disappointed that it's delayed, but it's important that we have one, because if we get to this situation again—. And already, we're back into headwinds after a very short period post Tata and Scunthorpe and everything else that's going on. It is not a way to run an industry.

If you're a worker in Port Talbot, if you're a worker in Shotton, if you're a worker in Llanwern, you don't want to go to bed at night feeling like the sword of Damocles is dangling over your head. You have a good job, you want a good job for yourself, you want a good job for your kids and you want a good lifestyle. And it's important for us, from a union point of view, that we have those options for them. So, that's, I think, a big, high political lesson to take from it.

I think the second point is about information. I think one of the big problems that we had on the transition board—and, Luke, I know you sat on it as well, so you'll know some of the issues we had—but just getting information at any point has been really difficult, to map the impact. There have been big worries about what will happen with jobs, there are big worries about what will happen to wages and mental health in the area, and there's no definitive text or research that has been put together on this. Getting information from Tata on some stuff—and it still continues to be—is like getting blood from a stone. Having key texts and looking at how these things will be impacted is still very difficult to map because we didn't have the information in the first place.

So, I think there's a big lesson for us again, from a political point of view, on how, when these transitions go forward, work and research needs to be done at the beginning to look at what this will do. And I think the transition board tried to do some of that stuff and Tata withheld a lot of information at that point. But it's very difficult then to make decisions if you don't know what the impact's going to be or what the current state of play is. So, I think those are the two things I think are really important.

Yes. And I would agree on the data side of things. It very much felt like an uphill battle trying to get much of that information. You mentioned, Tom, that you could write a book on this. In the case of Redcar, there was an impact assessment on the social and economic impacts of what happened. Is there any intention from the unions, whether it's a single union or jointly, of doing a similar impact assessment?

So, I can't speak for the other unions, but Community did do a study a couple years after the steelworks collapsed in Redcar, to see what had happened to the thousands of members we had at the time, over that period of time, and the results were very concerning, and I would not be surprised at all if they are repeated in south Wales. Because what we found is that, two years afterwards, many, many people who were displaced were still looking for work of comparable employment. Particularly concerning was the finding that at the point of 2015, when they were employed at Sahaviriya Steel Industries, the vast majority of the workforce were earning a good wage, in excess of £30,000 a year; two years later, of those who were fortunate enough to find a job, the vast majority were not. In fact, it was a tiny fraction who were earning that sort of level of wages.

And another finding was—. You know, people had whatever training they wanted, they were skilled up to the eyeballs, but the employment wasn't there, and that's the concern in south Wales as well. You can throw as much money as you want at training, but if the employment opportunities aren't there, then what's it all for?

So, lessons, I hope, to be learned from the situation in SSI. But just to go back to the previous question very briefly, one of the lessons that I think has to be learned for industrial transitions is that we have to match up the employment opportunities of the future with the transitions that are happening now. So, for example, the free port in Port Talbot is a really exciting opportunity, there will be lots of good employment opportunities there, we hope, but not for a few years. Now, with a little bit of forward thinking, surely we could have matched up the transitions in Port Talbot and the opportunities coming online in the free port. Because, in reality, the jobs in Port Talbot are pretty hard to replace. They're well paid, they make the wheels of the local economy go round, and there just isn't like-for-like replacement. So, we need more investment, and we need to match up opportunities coming down the track, in new industries of the future in particular, with the industrial transitions that we're dealing with today. But, in answer to your question, yes, we will do that in the fullness of time.

I don't know if we've got anything internally here, to be honest. We probably haven't discussed it at that stage. I think an important thing that we always try to get across, not just to you, Luke, but to pretty much everyone, is we are an organising operation first. So, nine to five, you're speaking to members, and then trying to do the rest is almost on top. So, it's really tough and really difficult. But I think it is important. Perhaps we'll look at that together, perhaps we'll want to do individual ones, but I do think, once we have it, it'll be an important text, because it can give us the pointers so that, when we go into those conversations, we'll know exactly what we need to ask for at those points, rather than asking for information that's not there, to make those decisions.

Jason, did you want to add anything?

Only to reiterate what has been said. When you look at the people that have actually been displaced, they become weekend millionaires—they've had their money. But the impact on them, long term, because they're highly skilled in their role of production of steel—that's non-existent now. If you fall out of retail, and you go back to retail, you've got transferable skills, but within the steel industry, like we said in the first transition board, these people are steel people, they're born and bred, they don't know any different, and part of the things from the transition, like learning curves, is accessing training and the funding of it, because they don't have that background. And it's quite difficult for some people to actually say, 'I want to be trained in this, how do I get the money for that?'

So, I think, long term, a succession of people have dropped out, saying, 'I'm not even going to continue with it.' Like Alasdair said, they either fall into employment, and they've got their severance package, or, by the time they've used their severance package, there are no other jobs. We've all seen what's happening within the south Wales corridor—it has drastically reduced with volume. We did discuss, in the meeting with Tata the other day, in 2000, when we were Corus, there were 28,000 people within the steel industry, and Chris alluded today that there are 5,800 people. The amount of people we've lost since 2000—you won't get those jobs back.

Just to touch on some news that we had from Tata outside of this committee, there's been confirmation that they're moving its rolling operations from Llanwern to Port Talbot. I'd be interested to understand from you guys what the implications of that will be for Llanwern and, of course, in Port Talbot as well. I don't know who wants to take the lead on that one.

We have a smaller membership in Llanwern, so you guys should deal with them. I'll pass the ball.

I'll start. The situation at Llanwern is extremely concerning. The plan is, as you know, to consolidate cold rolling at Port Talbot. That was announced as part of Tata's original transition proposals, with a separate timeline. That would happen three years, essentially, after the changes to the upstream configuration, and with the loss of, potentially, another 300 jobs, all to be consulted on at a later date. It is concerning, the situation at Llanwern. Our members are extremely worried there. It's the changes around the cold mill, combined with the lack of investment, which I mentioned earlier, which was promised for Llanwern, which we've not seen.

The feeling is that Llanwern's future is hanging by a thread, and that's combined with a situation where we're seeing, and our members are seeing, and their friends and family members are seeing, piles and piles of coils piled up at Newport docks, galvanised steel, directly competing with products that Llanwern make in the UK market. So, there is real worry at Llanwern about what the future holds.

We need a sign, quite frankly, and we need a real commitment from the company to make these investments, to give the workforce confidence that there's a secure future at Llanwern. It is a big worry. And it shouldn't be, because galvanised steel is one of the areas where there are massive opportunities in the UK market. We know that. The steel strategy the Government's working on has identified galvanised steel as a key growth area for the UK. We have a fantastic site in the UK that can deliver galvanised steel, and we need to support it and invest in it.

I think the one you alluded to there—£200 million for the new pickle line that's going to be installed in the annealing bay in Port Talbot by the French company Clecim—if you look at the potential, it's got 1.8 million tonnes capacity, and they can also do the pickle and oil. So, my view of it, about the impact on Llanwern, is you could potentially get an impact downstream in Trostre. You've got a pickle line in Trostre, where they could, with the pickle and oil straight from Port Talbot, go straight into the five-stand in Trostre, where you could lose, potentially, 50, 60 jobs within an employment of 520 people. So, long term, what is going to unfold by the investment might have another catastrophic effect further down the line, with the volume that that line can produce.

Just the final two questions from me, Chair; I'm conscious of time and other Members wanting to come in. I'll move to the tariffs that have been announced by the European Union. Alasdair, you've been pretty clear in some of the interviews you've given—the ones I've heard—on the potential impact on the steel industry that this will have. Could you just elaborate a bit more on that for me, please?

Yes, of course. It's extremely concerning, the situation, potentially catastrophic. I don't think it's an understatement to say that. The US tariffs are a major problem for the industry, but, in reality, perhaps a couple of hundred thousand tonnes-worth of exports we're talking about there, and probably the trade diversionary impacts of the US tariffs are more important. 

The EU tariffs are a completely different order of magnitude. We export 50 per cent of what we produce—2 million tonnes. Of that, 80 per cent goes to the EU. So, more than 1.5 million tonnes of steel we send to the EU every year. If that market is closed to us, or if it's partially closed to us even, there will be severe consequences, jobs will be threatened, and we could even see plant closures. It is an enormous concern. We can't overstate that.

We know that the Government is working very hard to try and get a deal. They have to get a deal. Common sense would say that there is a deal to be done, because we're replacing our own safeguards, and we are the EU's biggest market, so you'd think that they'd want to protect their access, and we want to protect our access, and there should be a landing zone. But we don't have any confidence that that is going to happen. As it stands today, we're starting from a point where we don't have any country quotas. We don't have any confidence that we will. We haven't been given any confidence. We haven't been given any timeline for the discussions to conclude. So, it is very, very worrying.

We have to get that deal done, but, crucially—even more crucially—we have to bring forward really decisive action on our own trade defence regime, because we have to close the door. Every other country is closing the door. The US has done that. The EU is about to do that. And what's going to happen? All of this steel floating around the world, from China, from India, is looking for a home. It cannot end up here. If it ends up here, we're doomed. That's it. We will see the collapse of the steel industry. The stakes are that high. It's absolutely vital we get this right. 

So, our message, as I've been saying repeatedly over the last few days, is we have to get this deal done, but we have to close the door and stop the trade diversion that we're going to see flooding our markets, depressing prices and costing jobs. 

Can I just quickly come in on that point? What do you see as the bigger challenge here? Is is the access to the EU market, or the potential flooding of the domestic market?

Well, it's both. It's huge. As I say, 200,000 tonnes to the US—that's a problem. There's 1.5 million tonnes out of a 4 million-tonne production going to the EU. If we can't sell that to the EU, where are we going to sell it? We can't sell it to the US now. We can't sell it to the EU. And then we're competing on a global market with all of the underpriced dumped subsidised Chinese steel. And there is nowhere to sell it.

So, we've got a serious problem if we cannot export steel to the EU. Possibly a more serious problem, even, is that we don't protect our own market and see prices further depressed, because as we've already talked about today, Tata is not making a lot of money at the moment, neither is British Steel, neither is Liberty, neither are any of our steel companies. So, any further downward pressure on prices is, potentially, going to be catastrophic.

Would you agree, Jason and Tom?

Yes, I agree. Just to add to that, steel people will talk about steel forever; that's one of the things I've learnt very quickly working in steel. But the key thing is this is not going anywhere. It's not like, 'Well, if this happens, we'll get over it, and in five years' time, we'll just be reliant on a source of foreign steel'. We need to build our own domestic supply. We need to export to make that viable in any way, shape or form. So, this action is urgent. The divergence stuff is going nowhere in the short term. We are seeing the world pull itself apart. If we don't have a domestic supply for this stuff, we will see our economy depressed even further.

Thank you.

Before I ask Jenny to come in, quite a few numbers came out in that little section there. I think you said that we're the EU's biggest export market for steel. Alasdair, I think you said that. So, they've got quite a bit of skin in the game if we were to take retaliatory action against their imposition of tariffs on UK steel. 

Absolutely. This is a mutual interest issue. We feel that global overcapacity is a massive challenge. It's a massive challenge for us, it's a massive challenge for them, but we should be working together, the UK and the EU, on it. The challenge is China, it's India, it's not each other. We have mutually beneficial supply chains and there must be a shared solution. We support the Government in the negotiations they're having, we're working also through our colleagues in the European Metalworkers Federation, industriAll Europe, their position, and they've been very involved, working with EUROFER to put pressure on the Commission to get some trade defence measures put into place in Europe, but they agree that the UK is a special case. We are friends and neighbours, we have mutually beneficial supply chains and we are not the target, so we hope that common sense will find a way through, but at the moment we just don't have the confidence to say that it will.

And only 32 per cent of steel produced in the UK is used in the UK market at the moment, the rest is exported—

Only 32 per cent of UK demand is satisfied by steel that's produced in the UK, which is a historic low. It's a very, very sad state of affairs, but on the other hand, it's a massive opportunity for us. With the right trade defence, with the right investment, we do have the opportunity to grow our industry to take back some of that market share. When I first started working around the industry we were double that, we were in the 60-something per cents. We can do that again, and we have an opportunity at the moment through the potential for trade defence, through the carbon border adjustment mechanism, decarbonisation, green steel, there is a massive opportunity if we get this right. So, it’s always good to have a note of optimism in an otherwise very difficult conversation.

Those numbers are very helpful for us to understand. Jenny.

Everything we've discussed so far demonstrates that everything that we do in this country seems to be reactive, rather than proactive. So, what are the three actions that you want the Welsh and UK Governments to take to strengthen our resilience before we just see the whole steel industry and our future as an industrial nation go down the pan?

It feels like that today, that we're being very reactive. I think that, since we had the change of Government, actually that's not necessarily always been the case. We've had more support from the Labour Government in Westminster than we did in the last 14 years of Tory Government combined. A lot of important actions have been taken. We've seen improvements to procurement policy, though not enough; procurements on energy policy, though not enough again.

We're in the process of confirming, and hopefully in the not-too-distant future rolling out, a steel sector strategy as well, but the situation on the EU tariffs is urgent. The No. 1 thing that has to be done is we have to bring forward our own trade defence proposals, we have to slash our safeguards and get them to a point where they are meaningful and they are stopping cheap steel coming into the country from places like Vietnam, from Turkey, from India, from China, giving us proper protection from the impacts of that. That is the No. 1 thing we have to do.

Of course, beyond that, with energy prices, we still have to make much more progress on that. The extension to the supercharger, the move from the 80 per cent to the 90 per cent exemption from network charges, is really important. The Government has probably gone as far as they can on mitigating the policy impacts relating to steel energy prices, what we need now is action to address our uncompetitive wholesale prices, because the figures show that even after the supercharger changes, we're still paying 25 per cent more this year than the French and the Germans are for energy, and that's completely unsustainable. It’s costing £26 million this year, even after the supercharger changes have been taken into account.

We do have a solution for that. The industry is advocating a two-way contract for difference, which means that our energy prices would be pegged at the same level as they are in France and Germany. If they go below that level, the industry would pay a sum of money to the Exchequer; if they're above that level, then the Government would pay an energy price subsidy to the companies. We think that's really important. It's a fair way to address the issue. If we don't do something about the energy prices, then we have massive problems in terms of investment and our competitiveness and decarbonisation as well, because whichever way you look, whether it's direct reduced iron, electric arc furnaces or something else, all of the low-carbon technologies require more electricity use, not less.

So, as such a large electricity user—and if you're making steel, you've got to use energy—why has Tata not had its own electricity production on its sites? The sites are plenty big enough, sitting there on the coast—there's plenty of wind. What's going on here?

Well, did you want to come in there?

I think it's probably more a question for Tata on that. There are projects out there at the moment: we've been dealing with a company, Last Energy, that are looking to put in micro small modular reactors, which would be able to produce that kind of energy. But it's a traditional industry, isn't it? For most organisations and companies that work in this country, and particularly the fact that Port Talbot's not brand new—it's been there for 60, 70 years—they will attach to the grid and you get the energy that way, because if you have an issue on site, let's say the power plant goes down, it wouldn't work.

Okay, but you can have your own site and then have back-up. But anyway, we are where we are.

I just want to now move on to the effectiveness of the transition board. You've already told us that there was a reluctance to share any information, even in the last couple of years. But, clearly, there should have been a lot more information sharing, if we were to take the workforce with us. So, what's your insight into the way in which the transition board has, or has not, enabled those core vocational skills, which Mr Jaques was talking about, to be maintained for, obviously, our ambitions for Wales as a green industrial centre?

Shall I come in? I've sat on it from the beginning, and I know Jason does as well, but I'll lead on that. The transition board, I think, has made the best of what it had to do. I don't necessarily think—. I think we all, when we had those initial conversations with the last UK Government, were very keen to say, 'We want a seat on this board, we want a place on this board to talk about what the issues are.' But from the GMB's point of view, from the beginning, we were saying, 'We don't want this to be a short-term mitigation strategy; this is about like-for-like job replacement and whatever way we can do that.' And it was quite clear, I think, from the beginning, the last chair of the board, who was the then Secretary of State for Wales, did not see it that way. So, it didn't really get going, from our point of view, until the change of Government, at which point, in one respect, the decisions had been made and we were where we were, and it was very much a kind of, 'What can you do to mitigate the damage?'

So, I think, from that basis, I would say it was sub-optimal, because what everyone would like to see is that when you leave a job, you go into another good-quality job that can give you a lifestyle worth sustaining for you and the community. I think, broadly, it's been rather successful from that point on. The skills training and stuff has gone out. I know that Community set up an office, and they had members in there—probably some of ours as well—getting some employment advice. So, it was very good, in one respect, joining hands.

But the big question we have, and we won't know now or in the future from the earlier point, is just how successful this stuff has been. Because, as Jason's highlighted, if you get voluntary redundancy money or even some cash up front or initial skills, it's about how you use them and how they develop those long-term jobs. We don't know where they're going to be. Some of the stuff, looking at the free port—what is the plan with that?

We've had the conversation about floating offshore wind—another project that seems to get delayed consistently: how much of that is going to be produced on site? Where are these jobs? Whether like-for-like job replacement materialises for those people is still unseen. And we have a lot of scepticism around whether you will see manufacturing on the site. And it could lead to the issue that Llanwern are seeing now, where you've got, not rolls of coil, but you could have parts of the new floating offshore wind structures being shipped into Port Talbot for a bit of manual work, before they're shipped around. They're watching their jobs disappear and stuff being shipped in from abroad.

So, I think there are big issues there. There's also the question about what happens with the south Wales industrial cluster. We've had conversations—. Wales and West Utilities were looking to run the HyLine project, which is a hydrogen pipeline from Pembrokeshire down to the cluster. Ofgem haven't agreed the seed money for that. So, the question is: how attractive then is that as a cluster to invest in? What is the process for companies to set up—

So, Ofgem haven't agreed to it, but what can the Government now do then, both the UK or Welsh Government?  

Well, there's a load of things. Again, it's a slightly different issue with Wales and West, of course, but if they're looking for seed money to look at the viability and the process of that, it doesn't necessarily need to come from Ofgem; it could come from some other source. It's not a finalised agreement. I think that comes up again in the autumn, but our view would be anything they can do to get seed money to that company to look at that, it makes the south Wales industrial cluster a lot more attractive. And quite frankly, for those people who've left jobs in industry, if you work in industry, it's very unlikely that you think, 'Actually, do you know what? I'd love to do social work after this, or I'd like to work in the theatre or something.' So, if it was like-for-like jobs, we're more likely to come with a—[Inaudible.]

Okay. We'll come back to that another day, but thank you for that. We visited the Community support centre in Port Talbot and we thought it was excellent, and the people who were working there were very, very dedicated to helping people as far as they could. My concern is always with the people who don't attend. So, you all have a list of your members who were made redundant: how do you, or the Community shop or anybody, ensure that everybody is being reached to try and help them as far as possible?

That clearly is a challenge. Just a word on the Community shop, if I will. I think one of the lessons that we learnt throughout this whole process is how important trade unions are in the conversation about how we support people after huge restructurings like this. It's been a massive project, the Community support hub. We're very proud of it, with thanks to the Welsh Government, who invested hugely to help get it up and running. I think the value of it is to have a one-stop-shop approach. We had the Department for Work and Pensions, Neath Port Talbot council, UK Steel Enterprise, employment agencies and Google in there. It was somewhere that people could go and access all of these different services under one roof.

What was really important was that it was the union, it was a trusted face; obviously it wasn't just for Community members, it's open to members of all unions, and any member of the community who is impacted in any way by the proposals. We've had more than 3,000 learners going through the doors, which I think is fantastic. We'd like it to be far more, but we've been infinitely more successful in getting people through the doors than in fact Tata have been in the context of the employment support services that they put on, because the reality is, given what happened, people didn't want to go to Tata for support, for advice, for guidance; they'd had enough of Tata, they wanted to go elsewhere. So, having that accessible, approachable sort of trusted place that people could go, in the heart of Port Talbot, has been massively successful.

How do we get more people in there? Of course, we need help. We've advertised our services. Many politicians have come and promoted what we do. Many, many media articles. We've done advertising, word of mouth. Clearly, you can always do more. Anything anyone in this room can do to help us get people through the doors, please do it.

In my experience, depressed people don't respond to adverts. So, what are you doing, door-knocking the people you haven't seen, who you don't know what's happened to them?

Well, of course, we're a trade union. We try and promote what we do through our network of members and reps. We're in the community; we have hundreds and hundreds of people who spread the word. You talk about what we're doing to help people in the community—

But do you actually get people knocking the door?

People knocking on the doors—

Of individual X, who you don't know what's happened to them. Are they working or are they not working, or are they just sitting at home looking at the wall?

Well, clearly there are data protection issues there as well.

Yes, but you're holder of the data. I don't have it.

No, we're not. We're not the holders of the data. We don't have—

They're your members, aren't they?

Our members, yes, our members, but—

Oh, your members.

Yes.

So, when it comes to it, again, I think there's a big question here for the future transition board about what happens after we hit the next stage, jobs move on and people move on and how this impact moves on. We've all done a lot of work contacting members, via phone, not necessarily knocking on doors, although the reps will have done it, and we all have regular meetings with the members. So, there is a constant conversation, and we've seen people at the beginning walk away from the process and be very much like, you know, 'To hell with everything', come back. The question is: once you've lost your job, do you retain your union membership? Now, we'll all say you should do that, you should be here all the time, but once you lose faith in the union or you lose faith in the organisation as an employer or a political party, actually how you get them back is a very difficult process from that point. So, I think, for us, we'll have to monitor how that goes, but there has been lots of engagement with people, not necessarily even just with those who are union members.

Absolutely. 

I think it's at the lower level to start, because before something would raise its head to us as officers at this level, we've got a multi-union. Based in Port Talbot, there's a multi-union where they work closely alongside each other, where people are identified at risk of redundancy, they have the one-to-ones, they have the consultations, where they're supported by the reps. Not many people will go to a one-to-one without that support of the rep going with them. So, those reps are long-established to provide the information to them, so that if they do feel that there's something that they want to progress or raise, then it can come through to our level. I'd say we haven't had a great deal at this level, because it's been done on the shop floor, and I think what Alasdair's point is is that the workforce trust the reps before the business. They've worked with them for a long period of time, and they're not just reps to them, they're friends, they're colleagues to them.

Yes, sure. So, obviously, your reps are very, very important. How do you deal with the people who are travelling to work from further afield to get to the Port Talbot site? Obviously, people in Port Talbot know where the Community shop is, what about people who are living in different towns further up the Valleys? How do they get reached?

In terms of union members, the information that's sent out by individual unions will have information, 'This is the shop', and you guys do newsletters, the local press; it'll be on the shop floor as well. The employer as well are keen to get people through stuff, so there's that word of mouth on the floor, and it's in the shopping centre in Aberafan, isn't it, which is again a well-known place, in the middle of it. So, I think people are very well aware of it at this point, but also if people have concerns and they don't know where it is, they'll generally just pick up the phone to one of our offices and they will say, 'This is where it is', or 'Here's the rep to have a chat with, and they can direct you.'

Okay. In due course, will you either individually or collectively be doing an analysis of where people have ended up after a period?

That is really important, and we don't have a full picture on that, and, as I understand it, neither does the transition board. So, there's lots of good data on who's been trained and what they've been trained in, but tracking people into employment and assessing the quality of that employment compared with what they had, that's something that needs to be done. Jason mentioned before the current weekend millionaires. A lot of people, obviously, have had redundancy payments and perhaps aren't actively looking for employment at the moment, but that's a problem delayed rather than a problem solved.

But just on your previous point about getting people into the hub in Port Talbot to access employment services, we also put on remote services as well, I think it's important to say. So, we've got a partnership with Google. Google actually fitted out our learning centre in Port Talbot, and they've been putting on online and physical employment support seminars, helping people to learn to use AI, to write curriculum vitae, to do job search, to gain interview skills. We've trained about 1,000 people through that route as well. We recognise that accessibility is sometimes a challenge for people, so we try and address that by doing things online as well as in the physical environment.

Sam.

Thank you very much, Chair. You will have heard my questions around the opportunities with the Celtic Freeport, and Jenny's touched on this a little bit as well with yourself, Tom. But given where it is, and, Alasdair, you made a reference to the better linking up of future projects with the timescales that were there. In an ideal world, absolutely, but sometimes realities move. How are you and your membership now looking at those opportunities around the Celtic Freeport? Is it something that feels attainable, or is it still a little bit of expectation management because, as Alasdair alluded to, the timelines aren't quite aligned? I'm not sure who wants to kick that off. Tom.

We've done a lot of work with the Celtic Freeport. There's been a bit of, initially—. Well, let's start at the very beginning, I think there was scepticism broadly from the trade union movement about how effective free ports are to deliver stuff. Needless to say, we have one and we want to be involved. I think the way the Celtic Freeport was set up there, we were assured we'd have a seat on the board. That now hasn't happened. So, in one respect we're still yet to see what the value of it will be. We're very hopeful it will be valuable, because whether or not we agreed with how effective we think a free port is, any benefit is a benefit. So, we're happy to see where those things go. 

I think in terms of those projects, Sam, the issue we've got with this is very much taking unemployment and redundancies from the political debate into the real world. So, this comes right into the debate about upskilling for green jobs right now. If you're a worker in Port Talbot, you don't just suddenly think, 'Actually, do you know what, I should do some training on developing green skills.' It doesn't work that way. Generally, you hit a crisis point where you think, 'My job's no longer going to be here, ergo I need to go through training to move into this thing.'

Much like the the possibilities—usually it's floating offshore wind, but other things may come and use the free port as a base—until we know what they are, the members aren't interested. And quite frankly, there's not really been anything, apart from floating offshore wind, to look at. So, for a lot of our members, you're not going to sit on—. You might have a bit of cash in your pocket right now, but that doesn't last very long, nor does everyone think, 'Well, do you know what, I won't work until I find a good job'. You get into work as quickly as you can. So, until we see those things develop, they don’t really have that much to say on it and they'll be sceptical. However, if a big company comes in and brings loads of jobs, yes, we'll be the first ones knocking at the door, and we can use our free port access to do that.

Okay. Thank you. Any other points, Alasdair or Jason?

I agree with all of that. I think there are big opportunities there and we need to take full advantage of them. What I would say is that we need to take advantage of them right through the supply chain, because we have a situation where we might have a free port next to Port Talbot steelworks, making platforms for offshore wind energy creation using steel from somewhere else because Port Talbot can't make the necessary grades of plate that would be required for that facility, which just seems a nonsense. It requires a bit of investment, it requires a bit of ambition and some forward thinking, and I think, just generally in Wales, yes, but in our country, we need to get far more switched on and look long term and invest to take advantage of the opportunities ahead. I think if there's one thing the last few years have taught us, through Brexit, COVID, US tariffs and EU tariffs and the war in Ukraine, and so on, it's that it's really important to have resilient supply chains in this day and age, and we need to get far better at that here, and learn to stand on our own feet and maximise the benefit of these opportunities for communities in Wales and across the UK.

Thank you. You mentioned the supply chain there, and in terms of your membership, Tom, you mentioned that a lot of your membership has gone to Hinkley Point. I'm not sure if you're aware of the regional centre of excellence, which is Celtic Co, with 14 businesses in south Wales and Pembrokeshire looking at collectively coming together so that they can bid for jobs, which no one company on their own could do, because of the size of the businesses—more SME size—specifically around engineering and in the energy sector. Are you aware of any work that your unions or members have been involved in in some of those businesses as an opportunity, because, while based in Wales, there are opportunities UK wide that they're looking at maximising at the moment?

Specifically on Hinkley Point, I think 95 per cent of the supply chain, because it's owned by EDF, is in France. So, I do think that, in one respect, we haven't seen the upskill from that. We are interested in working with any of these organisations that are set up. Our view would be—and, again, GMB's gone on the record on this—that we want to see the biggest possible project we could have in Wylfa. We want to see a gigawatt development there. We want to see as much industry and development in south Wales as we can. Broadly, if people come together to work for it, we want to play our part in developing that. South Wales has an excellent manufacturing history. We still have lots of companies here that produce stuff. So, if they're looking to scale up, we're very interested to work in partnership with them, but, of course, on the proviso that they're good jobs and good employers.

Finally, you'll have heard the question I posed to the first panel around the wider £2.5 billion and the answer given there. What are your unions' views on that wider £2.5 billion around steel from the UK Government and accessing that for Tata? Do you think that, where the project currently is aligned, that £500 million is right, or actually, there's more investment that can be done, so more of that £2.5 billion needs to come to south Wales?

I think absolutely more of that £2.5 billion needs to come to south Wales. The £500 million has been given. Obviously, there's far more that can be done. I think the Government worked quite hard to persuade Tata to take more of that £2.5 billion previously, at the point that they came into Government and assessed the deal that the Tories had done with Tata around Port Talbot. But, ultimately, Tata didn't want to put in any more money at that time.

There are massive opportunities. We talked about steel plate and we talked about some of the investments in Llanwern that we want to see. Ultimately, we want to see primary steel making continue. We think that that's really important, particularly in the context of the international environment I mentioned previously. We'd like to see a DRI plant, possibly in Port Talbot, but certainly somewhere in the UK. There isn't sufficient demand for DRI in Port Talbot alone, but there certainly is a good case for it in the UK. There are massive opportunities. We know there are challenges and pressures on that £2.5 billion at the moment. Obviously, the Government is supporting the situation in British Steel, and now in Speciality Steel UK in Rotherham as well. That is really important. We need to protect jobs there. That was absolutely the right thing to do. But we have to make sure that we have enough funding available to make the investments and to transform the industry, really, which is what the money was originally intended to do. It's very, very important that more money comes into south Wales to support investment there.

The steel strategy is due to be rolled out sometime in the next few months. There are some really exciting investment possibilities contained within that strategy. Certainly, we've been involved in reviewing the proposals from the consultancy, Hatch, which has been setting out the opportunities for the future. The delivery mechanism, the timeline and exactly how those investments are going to be taken forward are is still to be seen. But what it really needs is for Tata to step up to the plate, because, ultimately, you're not going to get money for nothing. Tata need to play their part, and the signs at the moment are that they're extremely reluctant to talk about investment, given the precarious position of the industry at the moment. But it is absolutely vital that more of that £2.5 billion comes the way of south Wales.

Okay. I'm conscious of time, but, Tom.

I'll be very quick on it. I think the key thing for us is making sure we get the steel strategy right. This isn't about areas of the UK competing against each other. From a GMB Welsh staff member point of view, I'd like every penny of that £2.5 billion spent in Wales, but I think what's important is the whole industry itself reinforces each other. Welsh steel will not survive on its own without other parts of the UK, so we need to make sure that it all works.

Thank you. Jason, anything to add?

Yes, in 30 seconds, they've invested that £1.25 billion in Port Talbot to build the largest electric arc in the world. Fine. Your asset around you is falling apart. If you don't invest in that—. They should be taking part of that £2.5 billion to invest in these downstream businesses to use the steel that you're going to produce. Otherwise, you're dead in the water.

Okay. Thank you. Thank you, Chair.

Hannah.

Thanks, Chair. In your previous answer—this is a nice segue into what I was going to focus on, which is, hopefully, the upcoming steel strategy—I think, Tom, you said you're disappointed it's been delayed. We're expecting it by the end of this year. We're now in October. How likely do you think it is we'll see it by the end of this year? What are the key things you really want to see in it? I'm happy for anybody to go first.

Shall I start? I think that is certainly the aspiration. We need that steel strategy as soon as we possibly can. I think the priorities for us are—. Taking trade defence aside, because that's something that's urgent and has to be done now, we need that action on wholesale energy prices. That's what we'd like to see. We know that's very difficult to achieve, but that is extremely important. We need more action on procurement. It was very encouraging what the Chancellor, Rachel Reeves, said in her speech at the Labour Party conference last week—more action, more incentives to essentially encourage and press public authorities and businesses to use more UK steel. We are supporting a minimum threshold of 30 per cent UK content in all public infrastructure projects. That's an absolute minimum. And we need to lay out, which is going to happen, the key investment opportunities in areas like galv and plate and sections, where we know there are massive opportunities in the UK market, where those investments can be made, and how the Government can support companies to make those investments and match funds. So, investment support, procurement and energy prices are the three key priorities for us.

I'd go along with that. That's broadly where we are as well. I'm not sure on the 30 per cent target, but I think we were looking at something like that when we started in Port Talbot a while ago. We'd be keen to work together on that. I think the key thing for us is that not everyone's going to be happy in this. It's not going to be that this strategy is a panacea for it all. The point of our steel industry is that it's not a burden, but it's an asset, it is something that needs investment. It has a huge opportunity to upscale not just in south Wales, but across the UK. We have to have it. Pretty much everyone agrees on that. So, let's make the most value we can out of it. We're hopeful to see it by the end of the year, but if it isn't by the end of the year, what's important is that we have a document where, for the next 15 years, we can say, 'That's what we look to do and this is how we look to do it.' So, for us, getting it right is most important, but, obviously, urgency is another priority.

And how involved have the trade unions been in the development of that strategy?

We've been extremely involved, in fairness. The Steel Council was reconfigured specifically to develop this strategy. All unions have been represented on that group. We have had numerous consultations and opportunities to engage. We've reviewed the detailed Hatch report, which lays out all the investment opportunities. We've met with Hatch, we've contributed, we've put our own ideas across. It's been very much a collaborative effort. A lot of energy and time on the part of the Government has gone into bringing together all the stakeholders. I feel confident that, when it is rolled out, it will have the support of all stakeholders. It's crucial we get it right, and it has to sustain not just for a Parliament, but, as Tom says, for 20 and 30 years. Because that's what we're terrible at in this country; we need a really long-term view. This is a generational industry and it needs to be handed down to sons and grandsons and granddaughters for many years to come.

Yes, it shouldn't be in electoral cycles—we need to look much further afield—as tends to happen, sadly, in politics a lot. We recognise, obviously, that steel is a foundation industry, but, clearly, the steel strategy needs to link across to the broader industrial strategy as well. Jason, I think, in previous Unite evidence to this committee on this, Unite called for a plate mill at Port Talbot so it could make wind turbines here in Wales, rather than import them. Is that something that you would still want to see?

Yes, 100 per cent.

And this is my final point, Chair, because I am very conscious of time.

We've got a commercial break, so you can eat into that if you want. [Laughter.]

That might not make me popular with everybody. [Laughter.]

On the point around public procurement and the power of the public purse, and what you were saying about whether it's 30 per cent, or whether it's more, of infrastructure developments and the public sector using steel that is made here in the UK—and my question might be more to those who are based in Wales—do you think there's perhaps an opportunity here, in terms of public sector projects using steel, with the new procurement legislation we've had, through socially responsible procurement through the Social Partnership and Public Procurement (Wales) Act 2023?

Yes—apologies, I just jumped straight in there—we really hope that this makes up a part of it. I think one of the key things is—just to say again, it's a complex thing, steel, as you know well, Hannah—that there are different types of steel, and the issue you've got if you do a standard number on stuff is that, actually, a lot of the steel we may need for this stuff we don't create in Wales. So, we've got special Welsh green rules on stuff already. We'd like to see them increased, but I think, broadly, we need to look at exactly where that steel is made in Britain as well and if there's an opportunity to do it with British steel, because, again, the Welsh industry itself is not in isolation; it's part of a British industry, so we need it all to do it. But we absolutely think this social partnership and public procurement Act will be key to getting that in there.

Happy?

Yes.

Okay. Thank you, gentlemen, for your evidence this morning. It has greatly informed the committee's thoughts and deliberations on this important matter. A record will be sent to you of the proceedings today and your comments. If you have any issues with it or you don't recognise comments attributed to you, please raise that with the Clerk. Otherwise, obviously, that record will stand as your evidence given to us today.

We'll now move into private session while we change over for the final session of the day, which is the next half-hour session. Thank you very much.

Thank you. We now enter our final evidence session this morning, and we have two witnesses from the unions at the Tata steelworks, local representatives of the town of Port Talbot. I’d ask you to introduce yourselves and the positions that you have within your respective unions, and then we’ll go into questions. I’ll start with you first, Ian, and then ask Wayne to introduce yourself.

Ian Williams, convenor for Unite the Union on the Port Talbot site.

Wayne Thomas, JSAC sec, which covers health and safety for the union in Port Talbot.

Great. Thank you very much, gentlemen. Obviously, there've been comparisons drawn between the treatment of the Scunthorpe site and the Government's intervention there, and what's gone on at Port Talbot. From a local perspective, what are the views of yourselves and your members about the way the two situations have been handled, and the differences between the two situations?

I think it was the right decision by the Government to do what they did for Scunthorpe, but I think it was very disappointing for our members. I think they felt very bewildered, really, as to why something was offered to Scunthorpe that was never on the cards for Port Talbot. Because I think Tata hasn't necessarily always been the best of employers, and it is very questionable, some of the decisions they've made, and how they've handled the whole process, really, since 2008, when they took us over. So, I think they're very disappointed and couldn't understand why it wasn't supported to include Wales in that legislation, going forward, so that at least, if Tata doesn't do what it says it's going to do, there's an opportunity for Government to come in and take control.299

But I think, even when the two blast furnaces went off, Unite publicly called for some sort of stake by the Government. I think that would have been the right thing, because, as a foundation industry, it's very important we keep steel and control of steel in this country. We've seen, with the Indians, with Tata, with Jingye, obviously, the Chinese, what foreign companies can do to damage, essentially, a foundation industry in this country.

Wayne, anything to add?

No. I totally agree with Ian. I know that members onsite, quite a lot of them, feel let down that the Government didn't come in and try and help us more, like they've done. So, yes, it is a lot of pressure at the moment still onsite and that, and stress—not just out there, but for people who have left as well.

Obviously, there's a lot of activity going on at the Port Talbot site, there is, in the construction phase now of the arc furnace. Downstream workings obviously are still progressing onsite and on other sites across Wales. Have you any views how that work has been able to carry on, and ideas of improvements that might be made during the construction phase for those downstream assets to be protected?

So, I think at the moment—. Obviously, we've got great concerns around the £2.5 billion green steel fund and how that's being used to run Scunthorpe at the moment. When we're looking at Scunthorpe, it's probably going to lose £300 million this year; they're forecasting £450 million next year. That is of great concern for our members, because £2.5 billion doesn't go far when you're taking £750 million out in losses. So, I think there are a lot of issues around that. What we really want is a commitment from Labour, or central Government, that a guaranteed percentage of that money will come to Wales. And I think that's got to be place based. It's got to be: that money will come, and x, y, z will come to Port Talbot, and what will come to Llanwern and Trostre.

I think, with the company, the runnings, they're running the business at the moment, but we don't see any future investment there. We don't see any investment in keeping the assets they've got going, improving them. We brought up offshore wind earlier—a brilliant idea. There's £5 million coming from the transition board, but, without a plate mill in Port Talbot, we'll never be able to take that, to use that material. So, we'll have £5 million of investment, but Port Talbot can't service that. We look at—. There are investments needed in Shotton, Llanwern, Trostre, and the company, at the moment, is making no investment in the future. We'd look at a shredder, obviously, for the scrap. These are fundamental things that you need to make a successful EAF: a shredder, so you can take cheaper scrap, shred it yourself, and put it into your own EAF. The company's not looking at any of that. So, we'll have a brand-new EAF, but, fundamentally, none of the structure around it, and a decaying asset base with the downstreams.

Jenny, you had a supplementary.

I just want to go back to the first question that the Chair asked, which is: at the time that the emergency legislation was introduced to safeguard Scunthorpe, would it still have been possible to keep the blast furnace, the second blast furnace, open?

No. At that point, the furnace—

It was too late.

—had closed, unfortunately.

Okay. It was too late. Sorry.

Thank you. Luke.

Diolch, Cadeirydd. If I could look specifically at the workforce and those job opportunities that are available, because we've heard a fair amount on it from the previous panels, but I was wondering if you could give me a bit of a lay of the land of how things are at the moment, and what sort of job opportunities have been available for those who have lost their jobs within the site at Port Talbot.

I think—. So, what you've seen, obviously—. For Unite, it's more the skilled workers—the craft, mechanical, electrical—the majority of them have had to move out of the area. They've gone to Hinkley Point and other places to work. So, we've lost that vital skill, where there's already a shortage, out of south Wales, really. I think with the production workers, they're highly skilled in what they do, but a number of them have struggled to get good, well-paid jobs outside, and a lot of them are either still unemployed or are in temporary jobs that have got no long-term future in them.

But also people have struggled to get the funding as well, initially, from the start. Quite a lot of people I know have given up. Through the process and that, they've just struggled. So, yes, quite a lot of people have given up and just gone off and done their own thing.

So, what we've seen then is, if you were after a like-for-like job in terms of pay and conditions, ultimately, you've had to leave the Port Talbot area—as you pointed out, for Hinkley Point C; we've heard that a number of times now.

For the majority of people, like-for-like jobs and the same terms and conditions and wages just don't exist out there. I think we had opportunity—. Everything was rushed, I think, through this process. We had the announcement in September of the £500 million funding, a non-announcement of the redundancies, then, in November, to come in January, February. But, fundamentally, a lot of the things that needed to be put in place hadn't been put in place at that time. I think Tata rushed through with their redundancy strategy, with the payments. There were opportunities there with the retraining scheme, but, if you'd put a proper retraining scheme in, you could have trained people in the foundation skills of mechanical, electrical, welding, bricklayers, plasterers—the things that are vitally needed in the south Wales corridor. And if we had that skill here, we could have had investment from businesses actually coming to the locality to set up as well. But, unfortunately, that skill that we did have has gone, and a lot of people could have taken advantage of that had there been a proper training scheme administered there. Sadly, they've gone into other jobs, and now there aren't those opportunities. 

One thing we've heard from the previous panels was about the data available to understand where some people have gone or whether they've been able to take up opportunities with the transformation of the site in Port Talbot. From your perspective as the local union reps, do you think there's been enough opportunity for those, with the transformation of the site, to take up a role or to be part of that transition over to an electrical arc furnace?

Definitely not. If we look at the furlough scheme Chris mentioned in the first part, he said it worked very well. We had 30 people going into that out of what was committed to be 100. So, 70 people were made hard-redundant, effectively, that could have been retrained and kept. I think there was a lot of opportunity. And this was all just transition. Had we kept one blast furnace going, we could have really transitioned in a proper way and created the jobs of the future. We could have put the shredder in, we could have put other things in and trained people into them, so, once we'd switched off plant, they could have moved directly into another job.

So, I think, no, we haven't done enough to retrain people to keep them in the business, and I think that the people that left, really, it was too little too late. I think the transition board was too late being set up. And the remits of that, if we look at the training—. Because, as part of the redundancies, there was an option that you could have had a year's retraining with reduced redundancy, and a reduced payment, but that came in in around about the November time. Well, unfortunately, most colleges start in September, so people couldn't get on to courses, couldn't get on to—. Everything was rushed, but too little too late, from the company, and I think the way the company administered the redundancies as well—. They made everybody work their three months' notice. They didn't put opportunities in where somebody could, say, go to college, in a part of that, one day a week, to be able to start a training programme. It was very much, 'No, you're employed for this time, you're staying here for this time.' A lot of the opportunities people could have had, they weren't allowed to have, then, or couldn't access.

Okay. Wayne.

No, I totally agree with Ian. The opportunities were missed with the training. Take my area at the time, which was energy; you had the power plant and the gas systems on site. When they shut them down, my guys just sat in the canteen for three months until their notices went. They could have had opportunities to do some training then. So, yes, to be honest with you, I think it could have been handled a lot better, the training.

Okay. Because I know this is a shorter session, Chair, I'll hand back. Diolch yn fawr. Thank you.

Just before I ask Jenny to ask her question, I just want to clarify, because we did hear in the earlier evidence that the furlough system that they'd set up seemed to work well. That's the evidence Tata gave us in their session. I think you contradicted that, Ian. You said originally you were expecting 100-plus to be on it, and it actually turned out to be only 30. Is that correct?

Yes, that's correct. As part of the redundancy, there was an agreement to keep 100 on furlough, which was 65 per cent of their wages, and they could be pulled back into work, as and when required, but only 30 actually went on to that scheme, and we actually made—. I think Chris said 120 had redundancy, because the company refused to put people on to that furlough scheme. They made them redundant because they said they hadn't scored enough in the process. So, the company could have kept another 70 people employed, but they refused to do that.

Okay, that's helpful. Thank you. Jenny.

Why do you think Tata was so reluctant to share their transition plans with you? Because they were clearly working on moving forward.

I think there were a number of things. Obviously, it's been going on since probably 2014-15, looking at transitions. There were a number of transition schemes that went backwards and forwards, and I think with change of Ministers et cetera, they could never get to a point that they knew how much the transition would be and how that would work. From the September, when the £500 million was announced, I think it was very rushed. I don't think the company was in a position to give all the full information. I don't think they had the full information themselves. I think it's very disappointing that we weren't involved in the conversations before that. It was very much done as the company and the Conservative Government at the time, together, without any consultation with the workers, because none of the workers—.

We all know we've got to decarbonise, we all know we've got to move to greener steel. That's not an issue, we all understand that. But I think the way and the manner in which we could do it could have been far better. If we look at other Governments, recently, IJmuiden, our sister plant in Holland, is having £2 billion from their Government. Well, you can make totally different choices. You can run the plant in a totally different way to get to where you need to be. So, we fought hard to keep one furnace going. I think that was the right transition, and we're seeing it with the struggles the company’s having now around tariffs with America—melt and pour is killing that. If we had our own furnace, we could have still kept that and been able to access that market with better tariffs. So, I think the company—they've got their agenda of what they want. But I still don't necessarily believe that what they want is the best thing for the future of steel making.

Okay. I'm afraid it's symptomatic of the way we do things in Britain.

Once the transition board was set up, how involved have you been in the transition board to enable you to do the support work of your role?

Our national officer, Jason, who was in the last session, sits on that for us. We have asked quite a number of times to meet with the transition board as local representatives. To date, we haven't had that opportunity to meet with the transition board, because I think it's important for us to meet as well, because we're the ones on the ground seeing the people and seeing the effects they've had. So, up till today, we haven’t met with the transition board. But I know, through Stephen Kinnock and others, we have attempted to gain access, but, unfortunately—

Why haven't you met them? Why haven't they extended an invite? It's not beyond the wit of man to do that, surely.

To date, we haven't had an invite to that transition board.

It's shocking. It's not the social partnership way we are endeavouring to do things.

So, in terms of the Government programmes to support affected workers—you've already told us a little bit about the failure to grasp the opportunities early enough—are there any schemes that have worked well or that could be adjusted to better meet people's needs?

I think a lot of our members, as I say, for Unite, are craft, so they had relevant skills that were very in demand in the open market. So, a lot of our members didn’t need the upskilling that was relevant to others. But I think a lot of the opportunities we had, as I say, through training people in this area, in green skills, but also in the fundamental skills we need—if we are going to achieve green, like solar panels et cetera, the traditional crafts—are too little, too late now. I think all of that needed to be sort of ironed out, and bespoke programmes put in place, so that when we started with the cessation of the plan, you put people through that.

The trouble is, I think, whatever training we do, the jobs are just not there now. Because the transition has been so rushed, with the free port, with everything else, it's five, six years in the future, isn’t it? If we had had a longer just transition, we’d have had the ability to bring new industry to the area, and people could have migrated, not necessarily working for Tata, but migrated from one job into another as it went.

So, I think it was all very rushed. After September 2023, it seemed to come like a lightning bolt, and Tata just wanted to get to the end of the process as quickly as possible.

Okay, that's very sad. We visited the Community support centre in Port Talbot, in Aberavon, and we thought the support that was being provided was excellent—the individuals were very passionate about supporting people. Can you just tell us what impact the centre has had? I have a particular concern about those who don't go, because they may be too depressed. How do we reach them?

I think it has been a success with a lot of the people that have gone there, not necessarily—. I think the difficulty is that we've had people who have worked 30, 40 years in the steel industry, they've now lost their job, and it's, 'What do I want to do?' They don't know what they want, or don't—. I think one of the mistakes is that that should have been done onsite, really.

Yes. 

I think if we'd had the opportunity in the three-month notice period, where people could access it onsite—. I know the company put in a professional company, LHH, but really adding Business Wales and all the others onsite, that people could access day or night—then people could have gone and had those conversations, and would have known what opportunities lay out there.

So, I think the people who have gone there, I think most of them have said, 'It's been very worth while.' But I think there was a lot more that could have been done—yes, by the chair, and probably by the unions as well, I've got to say—with the ones who haven't accessed that, to sort of move them into, 'Why haven't you accessed it, what support can we give you, and how do we really move you into training, or into better employment?'

The previous panel told us that your roles were key to enabling people to be reached. Have you got any sort of strategic overview of how many haven't accessed it, and what strategies have you tried to use to get people engaged?

I think, with that, obviously, everybody who was made redundant, unfortunately, I think we've spoken with. And we've asked them and tried to signpost them, but, probably, as for on paper, who has and who hasn't, no we haven't done. 

Nobody has—

It's probably a strategy that we should have had, but definitely should have in the future. 

Like I said, I spoke to all my members in my area and encouraged them to go to the hub, have a look at what was provided for them. But like I said, a lot of people leading up to that have struggled getting access to funding as well, and they've just walked away and given up.

I think, with—. Obviously, as Chris said, we've got to go down to 5,300 employees when we fully commission. I think he said that we're at 5,900 now. I think that transition, that money, has got to be used for people still employed, and how we upskill them in the relevant skills we need for EAF and how we will run in the future. We've got to be identifying where those job losses will be from the 5,900 to the 5,300, pinpointing those people and offering them the training now, so we've got an opportunity to move them into better jobs or into new jobs, and how, with our own workforce, we upskill them into what they need to be for the future, I think. 

Hannah. 

Thanks, Chair. We've heard plenty of reflections on what should have been done differently, and lessons learnt, but that's little consolation for those who have been impacted, and you're both at the sharp end living it, as you said. So, I think you've touched on some things that should have been done differently, such as to have a proper, meaningful and just transition. It sounds like Tata were very late to the table and very reactive. Is there anything else that you haven't had an opportunity to share with us in terms of your own reflections on what could have been done differently, but more importantly now—as I think you touched on in your previous comments, Ian—what needs to be done in the next year, in the next five years, in the next 10 years?

Yes, I think that the immediate thing is obviously the tariffs with the EU. That is a massive killer moment, a final nail, potentially, in the coffin of our industry, because if we look, it's around 40 per cent or 50 per cent of our stuff that goes into Europe from Tata Steel, 60 per cent at Shotton, and that's one of the highest value generating parts of ours. What we really need is a robust strategy for that, but one that allows us to export into Europe but also protects us from the likes of Korea, Turkey, Taiwan, China, who will dump into us because ours is weaker than theirs. We're already seeing that. So, I think that that's one thing. We've got to have strong targets to protect our own market. We'll see the CBAM coming in in January, and we'll be affected by that while we are going through a transition to green steel making, and in that period we're going to be hit by the CBAM tariff. So, I think if there's anything we can do around that—.

I think that procurement is a massive thing, but if we're going to have procurement, we've got to have melt and pour as part of that. Whilst it won't help Tata for the next two years until the EAF is up and running, at least once that's there, we're melting and pouring and we're ensuring that it's materials that are made in Port Talbot or the UK that are used in our procurement. 

I think that energy is a massive one, and it's got to really be sorted out. In a question, Jenny, you said earlier that 90 per cent of our energy used to come from our own operations. We had our own power plant and ran it via our blast furnaces. Sadly, because we took them off, we no longer do. I think that, perhaps, nuclear, a small modular reactor is something we need to look at, but I think that what we really need is for the steel strategy to come out as soon as possible. It's got to be right, but I think that it's disappointing that it's been pushed on, pushed on, pushed on, and we're now here, at the end of the year. We needed that 10 years ago. Whilst it's got to be right, we really need it as soon as possible, and that's got to really link in to our industrial strategy as well, because it's no good having a brilliant steel strategy or a brilliant industrial strategy, they've got to link together.

I think that what we need from the Welsh Assembly and Welsh MPs is—. On this £2.5 billion, we've got massive concerns. If money for Scunthorpe, Liberty Steel et cetera is coming out of that, there'll be nothing left for us. We need a plant-based, locality-based commitment that things will come and will be in Wales—in Port Talbot, Llanwern, Shotton et cetera. And I think that we've got to push Tata and, essentially, if Tata don't want to invest in the future and create what is needed to ensure that there's a viable process there, the Government needs to act to make sure that that foundation industry is there, and we push for a plate mill in Port Talbot that can do the green steel, we push for DRI. That should be in Port Talbot. We've got the area for it, we need that for our EAF. They are the type of things we need to look at for the future and we need to start bringing those industries and that investment in. And I think that, had we been a part of the legislation, there would have been something that Government could use to say, 'If you don't play ball, we're going to do something.' I think that it is disappointing that Scunthorpe was treated differently to us, there's no doubt, and I think that all of the political focus and everything else has been on them. We need to pull it back to the wider UK, and especially Wales. 

But it's fair to say, on that £2.5 billion fund, which is welcome, I think that most people took that to be investment money for the steel industry, rather than operational money. The way that Scunthorpe has panned out, it's operational money paying for the day-to-day running of plants, isn't it, which I don't think people thought was the purpose of the fund. It was an investment fund, was it not?

Yes, it was an investment fund, but unfortunately with what's happened in Scunthorpe, it's being used, from what we're being told, as the money to run Scunthorpe.  Obviously, Liberty have just gone into administration. Potentially, they might come under full national control—it's being used to fund that. So, the investment money we had—the £2.5 billion for the whole of the UK—which wasn't enough anyhow, that's been shrunk and shrunk and shrunk.

Yes, you make a very valid point, Ian. Sam.

Thank you. You touched on some of the potential issues around floating offshore wind and elements like that, so I won't touch on that too heavily. But in terms of the wider benefits, or the wider investment in Port Talbot, you've mentioned that some of the downstream elements need improvements, you could have a brand new EAF, but if everything else isn't fixed, isn't up to standard—. So, what else do you think Tata, Government, other businesses, other industries could be looking, in Port Talbot, to be doing to satisfy the workforce in similar jobs? They may not be directly applicable jobs, but similar jobs for members and colleagues and friends of yours. 

I think it's about linking it all up. I think the skills is a major part, because if we invest heavily in the skills, then the industry will automatically want to come, won't it? But with the offshore wind, we know that's going to be something that's for the future and that's going to be around for a long time. So, I think a plate mill instead of caster 2 is a massive investment that will allow us to make plate, and it's a direct opportunity for the offshore wind and all the industry that can come around that. I think we've got to link up with industry—all the new green industries, and how our steel can fund them and what downstream, or what operation, as in mills, we need to access our market. So, I think, we've got to be right for the future—it's no good looking to the next five years; we've got to be looking towards 25 years—that is going to be the future—and creating the market for that now. If we put the assets in now, we'll create the market for that, won't we?

As someone local to the area, and this is a broader question, and I think it's applicable here: Port Talbot has got a direct rail link into London Paddington, it's on the M4, it's an attractive place because of the industry—some of the skills that are there already. Is there anything else wider, away from industry, that you think Port Talbot needs in order to become more attractive for investment, to make itself that place to do business, away from the industry skills stuff, but as a local person? 

I'm not actually local, I'm in Merthyr Tydfil myself—a bit out of it. But I think what you'll find probably, on that note, is that the effects of this are not just felt in Port Talbot: there are a lot of people, with Ebbw Vale closing, who moved down, or who commute from Llanwern, when we lost the heavy end. So, I think this is a south Wales issue, and I think if we're not careful, and if we don't do right, industrially, we'll end up with the coal mines again. And I think what you've really seen happening with the closure now that has happened, you've ripped communities apart, you've absolutely ripped that sense of community apart. People are going to Hinkley Point, they're travelling for four or five days a week. They're away from their families for four or five days. You have really ripped the heart out of the community, and I think the only way you can bring that back, or regenerate that, is through good, well-paid jobs being in the area.

And do you see that then—. Sorry, Chair, final question: do you see that being a sole employer, like Tata has been that focal point, with the supply chain around it, or do you now see it being Tata and other big employers, or potential big employers, to keep that critical mass of employment level? 

We know that the EAF means less employment, but I think there are opportunities. We want more employers there, because we've seen with Ford, with various others around it—they're big employers, good employers—the massive effect they have. So, I think the more employers we can have providing good, well-paid jobs diversifies the risk if one does decide to leave the area.

Okay. Thank you.

Thank you both very much. Any other questions? Did you have any more, Luke? No. Thank you very much for your evidence this morning. A transcript will be sent to both of you so that you can see your contribution, and if there are any anomalies, please let the clerking team know, otherwise that'll stand as a record of your evidence this morning. Once again, thank you very much, and safe journey home.

Papers to note, colleagues. Any observations on papers to note? 

[Inaudible.]—particularly around the rail centre of excellence—

We're bringing that paper to committee next week, I think, on the rail centre of excellence.

The response from the Global Centre of Rail Excellence, yes.

Right, now, I've got to think of the wording here, because Rob tells me it's a different type of wording. Can I have a motion to move into private session, and also to move into private session for next week's meeting, and for the following week's technical briefing on the legislation? Lovely, we'll move into private session.