Municipalities around Tata Steel are more than tired of polluting factory

by

Prof. dr. Robert Gorter,

January 2022

Tata Steel in IJmuiden, The Netherlands © ANP

Municipalities in the IJmond are ringing the bell again in January 2022, because they are done with steel company Tata Steel. In the daily newspaper de Volkskrant, city officials of Beverwijk, Heemskerk, and Velsen say that they no longer accept that the company causes so much pollution and nuisance.

Never before have local politicians been so strongly about the environment surrounding Tata Steel. In a joint statement, the municipalities say they are done with the steel manufacturer, whose emissions have been shown to pose a serious threat to the health of residents. The municipalities themselves speak of ‘changing times now!’.

RIVM report

“Everyone benefited from the Hoogovens, as an important employer and as a driver of the economy in the region,” Brigitte van den Berg, a city official for the political party D666 of Beverwijk, said in the newspaper: “The nuisance and significant health risks were taken for granted too long by us (politicians).

The issue arose after a report from the RIVM last week (January 2022). This shows that the long-standing suspicions and previous publications about the harmful effects of the pollution of the Tata Steel factory are correct.’

The main conclusion: the dust showers that descend in the vicinity of the steel company can have an ‘undesirable effect’ on the health of children and adults. The amount of harmful particles is the greatest in Wijk aan Zee.

The province of North Holland then wondered aloud whether the factory, which has been in IJmuiden for more than 100 years, can continue to exist in this way. After the report was published, the provincial government indicated that it wants national politics to take action.

The RIVM report with shocking conclusions about steel company Tata Steel (owner is a major Indian conglomerate) hits like a bomb. The province of North Holland wonders aloud whether the factory, which has been in IJmuiden for more than 100 years, can continue to exist in this way. “The limits have been reached.”

Summary:

People living near Tata Steel are exposed to far more harmful substances than people living elsewhere. At the end of 2021, RIVM collected dust in dozens of places in Wijk aan Zee, Beverwijk, Velsen, IJmuiden and Heemskerk. This happened both on the street and in people’s homes.

The samples were compared in a lab with dust collected in Amersfoort, De Rijp (near Alkmaar) and De Zilk (near Noordwijk). Those places are far from Tata Steel.

It turned out that dust samples in Wijk aan Zee contain about 900 times as much vanadium, 160 times as much manganese, and 150 times as much iron as outside the IJmond. The concentration of lead was also about 100 times higher than in Amersfoort, for example. Lead is very harmful to health, especially to children.

RIVM cannot say how many people will develop a disease such as cancer as a result of pollution. “It is not the case that people immediately become ill if they ingest something, but any exposure can seriously increase the risk,” says research leader Janneke Elberse of RIVM.

 

Tata never paid corporate tax in The Netherlands

Tata Steel in IJmuiden has never paid corporate tax on its profits in recent years. This is apparent from an independent audit commissioned by the Noordhollands Dagblad (NHD).

In the past eight years, the steel company in IJmuiden made at least 1.7 billion euros in profit.

According to the accountant, 390 million euros in corporate tax should have been paid on this. But that profit was settled with the holding company, which gets the profits. That settlement was made at the interest on the debt that Tata incurred when taking over the Dutch-British company in 2007. According to Tata, this is normal practice in India and is not inappropriate. Tata does not have a special arrangement (ruling) with the tax authorities in the Netherlands.

Politicians and Public Health officers are nevertheless quite outraged about it. Tata Steel in IJmuiden is currently using the NOW scheme for companies affected by corona. In addition, the government has provided a guarantee on a loan of 150 million. Then the company would avoid tax that way.

The accountant of the Noordhollands Dagblad also looked at the financial health of the group. According to his investigation, Tata Steel Europe has overpaid 20.7 billion euros for commodities such as coal and ores since the merger in 2007 as a result of forced shopping at Tata’s procurement office in Singapore. In the ordinary market, they would have paid much less. A spokesperson for Tata calls that completely impossible. ‘We purchase raw materials worth 1.1 billion euros a year. How can you pay 20 billion euros too much in 13 years?

The spokesman forgot to mention that Tata IJmuiden buys from sister companies all owned by Tata India. Even with British purchases, you will not reach 20 billion in raw materials.’ The claim that IJmuiden would have lent 685 million euros to other business units of Tata must be a calculation error, in his opinion. “We have two loans outstanding. One of 111 million to Tata Steel Europe and one of 50 million to Tata Steel UK. Incorrect items must have been added by mistake, such as claims.’ The identity of the accountant engaged by the newspaper has not been disclosed, so the reputation cannot be established either. But it’s not Tata’s accountant.

It is also reported that the company’s top executives have received €45 million in bonuses per year in recent years. And Tata in Europe would pay between 12 and 18 million euros annually to the Indian mother for using the name Tata. Tata Steel Europe is now in financial trouble. A lot of money is lost, especially in Great Britain. Accountants from Price Waterhouse Coopers (PwC) even publicly doubt the continued existence of the British part of Tata Steel as a going concern, as de Volkskrant reported on June 26, 2021. This means that there is no absolute certainty that Tata Steel will be able to meet its financial obligations there in the coming twelve months. It is striking that the annual report of Tata Steel Netherlands for the 2019/20 financial year has still not been published, although it would have been ready for a long time. The Dutch part says it is financially healthy.

Dr. Gorter: “Disconcerting. As a super locust, Tata India seems to have eaten Tata Europe and thus, Tata IJmuiden is bare to the bone through highly questionable tax constructions. At the same time, the company is catching millions of Corona support. We immediately registered an emergency debate in the House of Representatives.’ MPs from VVD, D666, and PvdA are also concerned. They fear that the parent company in India will drain the Dutch steel group and speak of tax avoidance. According to many, this is a pure example of ‘tax evasion.