The UK needs to show some steel
Tata first announced problems in its Steel business last summer, when it said the business had been under-performing in the face of steel imports due to the strong pound and higher electricity costs which it said were double those of European competitors.
Tata said it had ‘identified 720 positions which will potentially become redundant’ earlier in the year, which now seems to have been a precursor to worse news.
The company was already in a state of chaos when Karl Koehler, chief executive of Tata Steel’s European operations quit in February.
Jason Pitt, “The reasons Tata have given, are partially allowing the business to divert blame.”
Government have said they do not feel nationalisation is not the answer, and indeed our members have mixed view on this also. So what is the answer?
When I first launched Made in the Midlands, it was not as it is today a membership organisation, it was a campaign launched on the day MG Rover collapsed with the loss of 6,000 jobs.
Britain’s businesses in addition to being uniquely for sale in the world, now face’s up to its own lack of investment in long term UK business.
British owned OEMs have been in gradual decline for generations, with very few emerging other than one’s owned by overseas investors.
Whilst the banks are often criticised or blamed, they are not well positioned to invest in what Britain really needs which is, higher risk investment in industry with a strong British interest.
If you want to borrow money for an idea or product that has a track record then you get traditional funding, if you want to develop a high tech app then a venture capitalist may come in, but if you wanted to create a large scale industrial business then the option is limited to nationalisation or
I have discussed this very issue while sat opposite the former deputy prime minister Nick Clegg and given him the solution, we need a British interest fund or sovereign trust fund that will invest in British businesses for the benefit of the community, industry and future generations. Should the steel industry be nationalised? My personal opinion is not in the long term, but neither should we just maintain a policy of leaving industry to it. And simply finding another overseas buyer to take advantage of government subsidies and incentives whiles extracting large management fees overseas is not in the long term public interests.
As the country that invented the game of monopoly I find it interesting that those at the top don’t understand the consequence of selling off all of your assets.