Marvin OnumonuThousands of manufacturing jobs have been secured after a major rail steel contract was agreed between Network Rail and British Steel.
The £500m, five-year deal will see British Steel supply more than 337,000 tonnes of rail track.
This follows Government intervention in April to stop the Scunthorpe plant from closing, after its owner Jingye Group said it wanted to shut down the site’s blast furnaces.
Transport Secretary Heidi Alexander visited Scunthorpe to confirm the deal.
Alexander said: “This landmark contract truly transforms the outlook for British Steel and its dedicated workforce in Scunthorpe, building on its decades-long partnership with Network Rail to produce rail for Britain’s railways.
“After taking urgent action to step in and save these historic blast furnaces from closure, we’ve now helped secure their long-term future by backing British Steel with meaningful government contracts, protecting thousands of skilled manufacturing jobs in the process.
“This crucial investment in our railway infrastructure shows we are delivering on our Plan for Change commitment to raise living standards in every part of the UK and ensure economic growth is felt by working people in our proud industrial heartlands.”
Business Secretary Jonathan Reynolds said: “This is great news for British Steel and a vote of confidence in the UK’s expertise in steelmaking, which will support thousands of skilled jobs for years to come.
“Following our decisive action to step in and save steelmaking at Scunthorpe in April, this contract will give the sector the security to supply the steel we need for the infrastructure of the future, as part of our Plan for Change.”
The contract, which starts 1st July, will provide Network Rail with about 80% of its rail needs.
British Steel will supply a minimum of 337,000 tonnes of rail, with a further 80,000 to 90,000 tonnes coming from European manufacturers.
These suppliers will provide specialist rail products.
Clive Berrington, group director for railway business services at Network Rail, said: “British Steel remains extremely competitive in the provision of rail and we are delighted that they will remain our main supplier in the years ahead.”
Craig Harvey, commercial director for rail at British Steel, said: “We are exceptionally proud to be extending our long-term strategic partnership with Network Rail with an agreement demonstrating British Steel’s importance to the UK’s economy and infrastructure.
“The contract is a ringing endorsement of UK workers and British industry, underpinning the vital role we play in ensuring millions of passengers and freight operators enjoy safe, enjoyable, and timely journeys on Britain’s railways.”
