The government is coming under pressure over who should bear the cost of cleaning up the massive, now defunct Redcar steelmaking site in north-east England.
Six local Labour MPs have written to ministers expressing their concern about the lack of information on the future of the Teesside plant and about Lord Heseltine’s role in any decisions made.
Concern is mounting over who is to pay for the clean-up of the 1,798 acre site, centred on the Redcar blast furnace, which has been despoiled by almost a century of iron and steelmaking. Some estimates have put the clean-up cost at up to £1bn.
Anna Turley, Redcar’s Labour MP, said the government should bear the costs since it had rejected plans to fund the £35m required to mothball the site. In its present unproductive state, she said: “It’s just a huge reminder every day of what this town was built on.”
It is understood the Official Receiver’s liquidator, appointed four months ago when Thai-owned Sahaviriya Steel Industries UK — the site’s most recent operator — was liquidated, is locked in negotiations over who should accept responsibility for the costs of clean up.
SSI UK acquired the Redcar steelmaking site in 2011 from Tata Steel for $469m and resumed production at the mothballed Redcar blast furnace, Europe’s second biggest, in April 2012. But the cost of reopening the site and the scale of overheads, exacerbated by a slump in steel prices due to Chinese overcapacity, resulted in losses of more than £500m in just over three years.
The collapse of SSI UK has cost Teesside about 3,000 jobs; the MPs stress in their letter the importance of the site as part of a wider economic and industrial strategy for the area — a role in which Lord Heseltine is playing a key part as recently appointed chair of the Tees Valley Inward Investment Initiative.
Source: FT