The government has announced £80m of support for workers who have lost their jobs at SSI’s Redcar steel plant.
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Thai firm SSI applied at the High Court in Manchester to wind up its United Kingdom arm, days after it announced it was mothballing the site.
The plant employed 1,700 people before it was announced on Monday that production would be mothballed.
The British-Ukrainian businessman said: ‘The closure of SSI’s Redcar plant is a damning indictment of the Government’s ineptitude when it comes to supporting United Kingdom heavy industry.
There will also be money to help workers who want to start a business and for existing small businesses.
“This is an extremely hard time for the workforce at SSI and the local community”, Business Secretary Sajid Javid said.
“This loss of business rates adds to the significant financial difficulties the council is facing and will affect the level of the support we can provide to those impacted by the steel crisis, as well as everyone in our community who depend on us for day-to-day services”.
“In the event SSI is unable to pay, the Government will step in to make up a few of the shortfall but we still stand to lose £3 million a year”.
“A loan or grant would be illegal under European Union state aid rules”, he said.
A spokesperson for the union said on Friday: “We have been saying for weeks that SSI is not fit for objective”.
The company that owns the troubled steelworks plant in Redcar has gone into liquidation.
He told Sky News Tonight the chancellor had put on hold a compensation package for the steel industry which could be “critical” for other “wobbling” plants.
“It should intervene to remove SSI and support an alternative approach that gives steel making an improved chance of a future”.
SSI is not the only steelmaker feeling the pressure – with the UK’s biggest producer, Tata Steel, also reeling from the impact of weakening demand and cheap imports amid the economic slowdown in China and other emerging markets.
Gareth Stace, director of UK Steel, said this was a welcome announcement to support the local community in its hour of need.
“The Government’s responsibility has not ended with the announcement of this support package”.
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She said efforts will now be made with the official receiver to establish how debts, salaries and pensions will be paid, and how the future of the site can be secured.
