Steel industry could 'crumble' in wake of Brexit vote, warns union

Britain’s steel industry could “crumble” because of the Brexit referendum, according to union leaders, who are now demanding an urgent meeting with the Government over their concerns.

Community, the union which represents steelworkers, is calling for talks with Business Secretary Sajid Javid to address fears that the crisis-hit steel industry will fail as the referendum dominates the agenda.

Tata started a sale of its loss-making 11,000-employee UK steel business in March, but industry sources say the Indian-owned conglomerate had been considering holding on to it, attracted by offers of government support worth hundreds of millions to keep the business alive.

However, last week’s vote may threaten those promises and buyers could be put off by current uncertainty over the economic impact of the referendum and its destabilising effect on Britain’s political leadership.

“The EU referendum result and government turmoil that has resulted have placed new question marks over Tata's sales process and we need to understand what actions government will take to safeguard the future of UK steel-making,” said Roy Rickhuss, general secretary of Community.

“The Prime Minister and the Business Secretary have both looked steelworkers in the eyes and said they would do everything to save the industry. Senior ‘Leave’ campaigners like Michael Gove said that leaving the EU would help save steel-making.

“It is important that the entire UK Government now gets behind steelworkers and helps secure the future of their industry.

“During this period of economic uncertainty, it would be a disaster if our steel industry was allowed to crumble.”

The call came after Whitehall sources told The Telegraph that Mr Javid had “genuine concerns” over the sales process because of the result of the EU referendum, with it likely to put off foreign buyers.

Also calling for assurances of support for Britain’s industrial base is EEF, the trade body which represents the UK’s manufacturing and engineering businesses.

Ahead of talks with the Business Secretary on Tuesday, Terry Scuoler, chief executive of EEF, called for industry not to be left in “economic limbo”, with ministers being urged to show it is “business as usual for Britain".

Confidence in the UK could be maintained by “getting on with important investment decisions, such as expanding the UK’s airport capacity”, Mr Scuoler said.

Ministers are right not to want to trigger the Article 50 to begin negotiations to leave the EU, the trade body said, and recommended “close engagement” with business to understand what they want to see from a new relationship with Europe before starting talks.