GOVERNMENT ministers are set to announce details of a multi-million pound package for Tata Steel to help fund a greener way of production at the country's biggest steel plant. 

Tata Steel is planning to change the way it produces steel at its site in Port Talbot in South Wales, with the loss of up to 2,800 jobs. 

The other site at Llanwern, on the eastern side of Newport, could see around 300 jobs lost  as a result of the planned closures across Tata Steel's sites. 

Tata Steel’s Llanwern site has a number of different businesses operating on it, the main one being the cold rolling and galvanising operation that predominantly serves the UK automotive sector from its world class Zodiac line. 

It is also the only Tata Steel UK site with the highest quality automotive grade galvanised steel capability.

The company will close the remaining blast furnace at Port Talbot by the end of the month in readiness for switching production with a new electric arc furnace which needs fewer workers.

The Business Secretary, Jonathan Reynolds, is expected to outline on Wednesday details of a deal to help with the transition.

The previous Conservative government had agreed to give Tata Steel £500 million towards the £1.25 billion electric furnace, which will melt scrap steel in a more in a more environmentally-friendly way than creating new metal.

Unions have been campaigning to save jobs at Port Talbot, warning that the losses would have a huge impact on the local economy.

The steel industry is a “vital part of our UK economy”, Rachel Reeves said as the Government prepared to confirm a support package.

The Chancellor told broadcasters: “The steel sector is incredibly important for the UK economy and we’re working in partnership with business and trade unions to help that transition to green steel, which is what businesses are looking for today in construction projects, whilst also preserving jobs.

“We’ll be making further detail available later today, but the steel sector is a vital part of our UK economy.”

Housing and planning minister Matthew Pennycook said “we have to have a green transition in steel production”, as the Government is expected to announce details of a multimillion-pound package for Tata Steel.

Speaking to LBC, Mr Pennycook said: “Steel is an integral part of the British economy. We have to have a green transition in steel production.”

Tata Steel UK’s Llanwern steelworks is still producing around 14,077 tonnes in a week.

Asked how the Government could find money to help Tata Steel, Mr Pennycook said he understands that the package is from “allocated funding” while “the pressures we’re dealing with in terms of the public finances are unfunded spending commitments”.

He added: “Ensuring there is a green transition in steel in this country is an important part of our industrial strategy and what it will take to get the British economy on a sound footing once again.”