The first money from a £100m fund to help workers and firms affected by restructuring plans at Tata’s Port Talbot steel plant is being released, UK ministers will announce on Thursday.
Tata closed one of its two blast furnaces on the site last month and plans to shut the second in September, as it moves to greener production and cuts thousands of jobs.
Welsh Secretary Jo Stevens will confirm that £13.5m from the fund will be made available.
UK ministers are in separate negotiations to try to save jobs at the steel giant, which is planning to lose 2,800 posts.
The funding is to support local firms whose main customer is Tata Steel find new markets and to help workers find new jobs, access training and gain skills and qualifications in areas where there are vacancies.
Tata launched a voluntary redundancy process last month, asking for expressions of interest by 7 August.
Ms Stevens will chair the Tata Steel Port Talbot transition board for the second time on Thursday, a body set up by the previous Conservative government.
Speaking before the meeting she said the “release of an initial £13.5m in funding demonstrates that we will act decisively to support workers and businesses in Port Talbot, working with Welsh government, unions and the wider community”.
She said the funding puts “a safety net in place now to ensure we can back workers and businesses, whatever happens”.
The minister will also announce that more than 50 businesses have signed a pledge to support any workers forced to leave their jobs in the steelworks.
The previous Conservative government pledged £500m to Tata towards the cost of a new £1.25bn electric arc furnace, which will melt scrap steel, and requires far fewer workers than traditional blast furnaces.
Construction of the new furnace is scheduled to begin in August 2025.
Tata Steel UK chief executive Rajesh Nair said: “The Transition Board has been set up to support both Tata Steel employees and those in local supply chain companies, so today’s announcement and the ambition to help the region and local communities grow in line with the changing needs of the developing industrial ecosystem here in south Wales, is very much welcomed.”
Alun Davies, the Community union’s national officer for steel, said Ms Stevens had acted “at pace to ensure that this first tranche of funding can be released as swiftly as possible, and we thank her for her steadfast commitment to our steel communities”.
“We are also particularly pleased that this announcement includes support for contractors,” he said.
But Mr Davies stressed the union would “continue to oppose the company’s damaging proposals”.
“It remains our firm belief that no compulsory redundancies are necessary, and that an alternative approach is still possible,” he said.
Charlotte Brumpton-Childs, of the GMB union, said: “Today’s transition board meeting was productive and a welcome sign of the reset this new government offers.
“We are keen to hear further about the government’s commitments to fast and targeted support for industry.
“It is vital for steelworkers, contractors and their communities, and the wider economy alike.”
Conservative shadow Welsh secretary Lord Davies of Gower said he was “very pleased to see that financial support from the transition board is reaching those impacted”.
“This deal was only possible because the previous Conservative government intervened in Port Talbot, with one of the biggest support packages in the history of steelmaking to save as many jobs as we could,” he said,
“I am also pleased that Jo Stevens and her colleagues have stopped engaging in deeply irresponsible comments, where they implied that a better deal was possible.
“Tata Steel were crystal-clear that there is no other deal than this.”