Alphasteel Ltd

The company, Alphasteel Ltd, based in Newport, went into receivership on 20 December 2007, which was devastating news for more than 400 employees, coming as it did just a few days before Christmas. In 2003, Alphasteel was bought by Satico Ltd, a Swiss-registered company with substantial steel business interests in the middle east. Late in 2003, Assembly Government officials met the company’s representatives to discuss their ambitions for investment, and the First Minister met them in 2004. The company was made fully aware of the ways in which the Welsh Assembly Government could support those plans. Despite these ambitious plans, the company got into difficulties, which led to the decision to place it into administration. As a Government, our immediate responsibility was to ensure that those affected by Alphasteel’s administration could receive advice and guidance on redundancy payments and benefits. Despite being hindered by the holiday period, I am pleased to report that significant progress was made on that during the Christmas and new year period.

On 3 January, Jobcentre Plus initiated a joint meeting with Careers Wales and Communitas, the Community Union’s education and training subsidiary, to finalise a plan to deliver advice and support options for those affected by the closure of the works. They continue to work closely together to ensure that all those affected are kept fully in the picture as regards advice and support. Over the weekends of 5 January and 12 January, Newport jobcentre was open to assist those affected by the closure in making benefit claims and to offer advice. I understand that redundancy payments are being dealt with swiftly and the unions have welcomed that. On 5 January, Communitas held a members’ meeting in Newport and provided further details of the advice and support available. A building at the Orb Steelworks site, close to Alphasteel, was secured and, from 10 to 18 January, it will operate as an information and support facility. Communitas, Careers Wales and Jobcentre Plus will maintain a presence there throughout this period.

Redundancy Action funding, which is part funded by the European social fund and administered by the Assembly Government, will be available to former Alphasteel employees. ReACT funding, designed to complement and supplement the services offered to redundant workers by Jobcentre Plus and Careers Wales, aims to address the needs of people made redundant through a series of measures designed to remove barriers to obtaining new employment. Under ReACT, employment recruitment support provides a contribution of up to £2,080 towards the costs of employing an eligible individual. Employer training support is a training payment providing up to 70 per cent of approved training costs subject to a maximum of £1,000, provided that the recruit remains in employment after 20 weeks. Other support, such as with curriculum vitae preparation and interview techniques, is also available. However, our further and equally important responsibility is to ensure that we do all that we can to ensure the resumption of steel production at the Newport works.

On 9 January, I wrote to Begbies Traynor, the administrators of Alphasteel, to express the Assembly Government’s willingness to work with them and any potential purchaser to secure a future for the works. We are, of course, mindful of the strict EU restrictions governing the provision of assistance to the steel sector, but the administrators have expressed interest in working with us once potential buyers are identified.

This is an early stage in the administration process, and the administrators continue to prepare the necessary work ahead of releasing information to interested parties. They hope that that will be done by as early as next week. Although it is too early to speculate on potential buyers for Alphasteel, I am encouraged to hear the administrators’ optimism over selling the site as a going concern, and the reports of significant international interest in buying the plant as a going concern.

The site has much potential. Its facilities are capable of delivering a first-class steel production and rolling facility, and it can offer a number of additional incentives to potential buyers. Alphasteel owns a wharf situated alongside the river Usk that is capable of taking vessels weighing up to 20,000 tonnes. The site is ideally situated close to the M4 corridor and benefits from a private connection to the rail network. The works also sit close to the Uskmouth power station. Steel production continues to be a vital element of Welsh life, providing good quality jobs, directly and indirectly, and the industry is a significant contributor to the Welsh economy.

Wales is rightly proud of its industrial sector and its significant steel assets. As a Government, we stand ready to work with the administrators, the unions, and others who have an interest in seeing a sale of the business that will allow Alphasteel to resume steel production later this year.

Although it is too early to speculate on potential buyers for Alphasteel, I am encouraged to hear the Administrators optimism on selling the site as a going concern, and the reports of significant international interest in buying the plant as a going concern. The site has much potential – its facilities are capable of delivering a first class steel production and rolling facility and can offer a number of additional incentives to potential buyers. Alphasteel owns a Wharf situated alongside the River Usk capable of taking vessels up to 20K tonnes. The site is ideally situated close to the M4 corridor and benefits from a private connection to the rail network. The Works also sits close to the Uskmouth Power Station.

Steel making continues to be a vital element of Welsh life, providing good quality jobs, directly and indirectly, and the industry is a significant contributor to the Welsh economy. Wales is rightly proud of its industrial sector and its significant steel assets. We stand ready to work with the Administrators, the Unions and others whose interests are on seeing a sale of the business to allow Alphasteel to resume steel production later this year.