Scottish Government May Be A Big Loser In Steel and Aluminium Potential Collapse

10th March 2021

Labour MSP Rhoda Grant and the party's Energy, Connectivity and the Islands spokesman John Erskine have called on the Scottish Government to ensure that Greensill administration does not impact on jobs at the Lochaber smelter.

Specialist bank Greensill Capital was the main lender to businessman Sanjeev Gupta's sprawling empire, which includes two firms operating out of Lochaber Smelter at Fort William.

Alvance British Aluminium, previously known as Liberty Aluminium Lochaber, and the newly-incorporated Cannings Hydro Resources, which was set up to manufacture soft drinks and to produce mineral waters and other bottled waters, operate from the base.

The Scottish government has to make clear the scope of the loan it provided in 2016 when Gupta bought the aluminium smelter in Lochaber and two hydropower plants in the area.

The appointment of administrators to Greensill puts 5,000 jobs at risk at Gupta's firms.

In a court filing, Greensill said Mr Gupta's operations were in "financial difficulty" and defaulting on debt. Rhoda Grant and John Erskine will meet with Highlands & Islands Enterprise on Friday to discuss the issue and are seeking talks with the Scottish Government, which also potentially loses out from the collapse.

Mr Gupta bought a hydroelectric station and the aluminium smelter in Fort William in 2016 for £330m with the backing of a 25-year guarantee from the Scottish government.

Mr Gupta - who has been photographed with Nicola Sturgeon, the Scottish First Minister - promised to build a new aluminium wheel factory, creating 2,000 jobs by the end of last year. Rhoda Grant said: "This is a deeply concerning situation and a very worrying time for workers. The Scottish and UK governments must act with urgency, they mustn't turn their back to this.

The Scottish Government was more than happy to use its support for this company as a backdrop for positive announcements on the eve of the last election when it handed Mr Gupta the funding guarantee. It must now fight to defend the long-term future of the smelter.

"Labour has been pressurising the UK Government all through this pandemic to do more to support British steel and the UK manufacturers who are their customers. This fell on deaf ears, putting jobs and the foundations of our economy on the line."



Mr Erskine, Scottish Labour's candidate for Skye, Lochaber and Badenoch and Spokesperson for Energy, Connectivity and the Islands said: "I'm very concerned at the emerging situation and the potential implications this has on the Lochaber site and for the workforce there. "The smelter is part of the DNA of Lochaber and it should be at the heart of a green economic recovery for the Highlands as we emerge from the Covid-19 pandemic.

"The SNP and Tory Government's must get round the table urgently and do everything they can to secure the future of the site which is a major economic driver for the local economy."

Liberty Steel boss Sanjeev Gupta warns over loss-making plants - BBC

Sanjeev Gupta's metals businesses miss UK tax payments - FinancialTimes