Port Talbot: was it inevitable?

Port Talbot

Every so often a short phrase delivered at a conference sticks with you. In 2001 I heard Lord Puttnam, at the time a Labour Peer and the first Chancellor of the University of Sunderland, offer the following observation: ‘there are now more people working in Indian restaurants in the United Kingdom than in the coal, shipbuilding and steel industries combined’.  He went on, as a supporter of the then government, to put a positive spin on this fact by pointing out that more people were employed at his University than were employed at the Sunderland shipyards at their height.

My early career had been spent in the coal industry. I worked there from 1968 to 1986 and during the 1984/5 strike was charged with establishing NCB (Enterprise), the Coal Board’s job creation company. At the time I was convinced that colliery closures were inevitable and that the challenge was to ensure that the process was handled effectively and humanely. Crude global economics meant that there was no point in sending men underground to deliver output that would be produced far cheaper elsewhere.

I agreed with Lord Puttnam that in the future employment in the UK would best be concentrated in the knowledge–intensive industries (for example IT) or personal services (for example care of the elderly). Standard manufacturing and routine administration would always be done where it is cheapest. There was and is, however, the prospect of long-term survival for operations that deliver a high value product based on ongoing intensive application of skills and on good workforce management.

Tata has said that it will close its UK steel business if it cannot find a viable buyer by 28 May. This week there have been indications of two potential buyers; both would require considerable Government investment.   It is reported that the moreattractive, a potential management-led buyout, could require workers to invest £10000 each. This feature of the bid is unlikely to float: it is inviting people to put all their life savings, or mortgage their home, in a high-risk venture.   The Government has rightly been castigated for its over-zealous pursuit of China and the lack of urgency and political acumen displayed by the Business Secretary, Sajid Javid.   Belatedly it has indicated a willingness to take an equity stake in a restructured business. However the likelihood is that only a small number of jobs will be saved in the long term.

So what does this tell us about the handling of Port Talbot crisis? If the decline of heavy manufacturing is inevitable there is little that a Government in power can do when faced with such an immediate problem.

The failure is a failure to develop a strategy based on sustained investment in skills and to formulate an active industrial policy concentrating on sectors that stand some chance of long-term survival in a competitive international market. There was thus a huge opportunity for the opposition but a confused and divided Labour Party has offered nothing new or convincing.

The whole story underlines the desperate need for a new thinking in left of centre politics.

 

 

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