Network Rail Spend £5MILLION on Foreign Steel As Crisis Gripping Industry Deepens

5 April 2016

Network Rail splashed cash on thousands of tonnes of foreign steel as the crisis gripping Britain’s beleaguered industry intensified, we can reveal.

The state-backed body pumped British money into firms from Austria and Spain - despite warnings the UK sector was struggling to survive under mounting pressure.

It is the latest blow to our battered steel workers as 15,000 are braced for the dole queue after Tata decided to sell its UK steel arm.

Transport Minister Robert Goodwill admitted: “Network Rail procures approximately 120,000 tonnes of steel rail per annum from Tata’s plant in Scunthorpe.

“Network Rail procures a further 8,000 tonnes of steel per annum for niche products supplied by Arcelor Mittal (Spain) and Voestalpine (Austria).”

Parliamentary questions showed Network Rail purchased 104,718 tonnes of UK steel in the past year at a cost of £67million - an average of almost £640 a tonne.

If the foreign metal was bought at a similar price, it means £5.1million of British money was spent abroad.

Read more: David Cameron must take tough action to tackle Britain's steel crisis

The Mirror has previously told how steel for a host of big-spending, key Ministry of Defence projects has been ordered from Sweden, Spain and Turkey and South Korea.

Earlier this week, the Government issued new guidelines requiring public bodies to “consider the social and economic impact” on the UK before buying steel from abroad.

But the last-ditch plea was blasted as too little, too late.

Lib Dem leader Tim Farron, who uncovered the figures using parliamentary questions, said: “The Government have made a massive thing about supporting the UK steel industry, but for months they have been buying steel from big infrastructure projects from Spain, Austria and South Korea.

“Once again the government is shutting the stable door after the horse has bolted.

“It’s no good asking councils to use UK steel now after letting the industry shrivel on their watch.

“Rather than taking real action to stand up for UK steel, the Conservatives are fiddling round the edges to give the impression of action.”

Network Rail has an annual revenue of £6billion and is one of Britain’s biggest buyers of steel.

It manages 18 of the UK’s biggest mainline stations, 20,000 miles of track and 40,000 bridges and tunnels - and is carrying out more than £25billion of works between 2014 and 2019.

The Mirror has previously told how foreign steel has been used for a host of major public contracts, including Swedish metal for two defence projects worth almost £3.9billion in total.

One is a £348million deal for three new Royal Navy ships, the second is a £3.5billion order for 589 Ajax armoured vehicles.

The MoD has admitted 4,000 tonnes of steel for new Royal Feet Auxiliary refuelling tankers will be sourced from South Korea.

And the Tories failed to guarantee British steel will be used for the Type 26 Global Combat Ship.

A Network Rail spokeswoman said: “British steel is absolutely central to our Railway Upgrade Plan – we buy more than 120,000 tonnes of rail each year from within the UK, which accounts for 96% of our total volume.

“Tata Steel is an important link in our supply chain, providing the majority of our steel rail from its subsidiary, Longs Steel UK Ltd, in Scunthorpe.”

The Mirror told in January how a lucrative train building contract was going to Spain - effectively ruling out using any British steel.

Derby firm Bombardier was snubbed as the £490million deal to build carriages for Northern Rail went to CAF.

Business Minister Anna Soubry will be grilled by Welsh MPs next Tuesday over her handling of the Port Talbot crisis.

And Welsh First Minister Carwyn Jones holds crunch crisis talks with David Cameron in Downing Street.


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