Page last updated at 05:19 GMT, Monday, 19 October 2009 06:19 UK

Unions reject Corus 'cost cuts'

Tata Steel's vice chairman says the company needs to be competitive

Corus unions on Teesside have dismissed claims by owner Tata Steel that not enough is being done to reduce costs.

B Muthuraman, vice-chairman of the Indian company, told the BBC's Inside Out that the Redcar site will not receive investment unless more is done.

Up to 2,000 jobs have been at risk at Teesside Cast Products (TCP) since a consortium pulled out of a major deal.

Geoff Waterfield, multi-union chairman of Corus on Teesside, said TCP's costs had been "scrutinised constantly".

Inside Out spoke to Mr Mutharaman in his former role as managing director of Tata Steel - which paid £4.3bn for Corus in 2006.

He said: "It is all costs. It is not investment. It is not new equipment.

"We must remember people need to earn the right to invest and that earning the right to invest comes from earnings and earnings come from reductions of costs, whether it is employee costs, whether it is conversion costs, operating costs."

Inside Out North East and Cumbria is on BBC One on Monday at 1930 BST
Catch it later on the BBC iPlayer

Mr Muthuraman admitted that costs at TCP had come down, but said "a lot more effort" was needed.

A consultation period on the future of the Redcar plant was due to end in August, but was extended when new orders were placed for September.

And earlier this month, Corus announced it has managed to fill the order book until the end of December.

Mr Waterfield said: "We're not making profits now but neither is anyone else.

"The very last thing you can accuse TCP of is not looking at costs. We were scrutinised constantly by the consortium while we had that relationship.

"And we're still battling through the recession to try to do that."

He added: "What matters to me is whether we can broker a new deal, and then I'm sure Tata will be very grateful to take the profits."

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