The European Commission has confirmed that the UK Government could have given state aid support to Redcar steelworks.
In response to a written question from Euro MP for the North East Jude Kirton-Darling the Commission said there are a wide range of reasons state aid can be given to industries.
The Redcar plant stopped production in September in a move which has devastated workers and the whole community.
There were calls for the UK Government to act to support the steelworks but no help was provided.
Since the financial crisis in 2008 there has been less demand for steel across Europe. In addition, lower demand elsewhere has led to steel being ‘dumped’ at low prices into the European market.
This has led to a loss of 40 million tonnes of production across the EU and a loss of 60,000 direct jobs and 100,000 indirect jobs. The environmental impact is also significant as we are now importing steel produced in less environmentally-friendly plants and shipped around the world.
The European Commission has stated that support could have been given to the plant for research and development, to develop innovation, to support training and employment or protect and enhance the environment.
Research … has shown that other European Governments are taking up the option of providing state aid to their steel industry.
Steelworks have been supported in Italy, France and Germany to help deal with the drop in the steel price and to increase the sustainability of the sector.
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