Management Discussion & Analysis

 

o) Human Resource Management and Industrial Relations
Tata Steel
Industrial relations remained normal at all locations. The men on roll in the Company as on 31st March, 2008 were 35,870 as compared to 37,205 as on 31st March, 2007. The development of human resources is a key strategic challenge in order to prepare people for future responsibilities in terms of professional skills as well as business skills. The Company is investing in the modernisation of the plant and training of manpower for upgrading their skills. Further, it is planned to redeploy the surplus manpower to various greenfield projects.

Corus Group
At the end of March 2008 the number of employees in Corus was 41,900, compared to 41,100 on acquisition of Corus on 2nd April, 2007.

Corus has experienced no significant industrial relations problems during the year. Well-developed procedures have operated in all parts of Corus for a considerable time for the purpose of consulting and negotiating with Trade Unions, the European Works Council and employee representatives. Approximately 78% of UK employees are members of Trade Unions, with the equivalent figures for the Netherlands and Germany estimated at 45% and over 50% respectively.

The British Steel Pension Scheme (BSPS) is the principal defined benefit pension scheme of Corus in the UK. Members contribute to the scheme at the rate of 6% of pensionable earnings. Following the triennial valuation as at 31st March, 2005, the Actuary certified that company contributions to meet the cost of future service benefits should be 10% in the Main Section with effect from 1st April, 2006, subject to review at future actuarial valuations.

As a result of the acquisition of Corus by TSL on 2nd April, 2007, the Company held discussions with the Trustees of the BSPS and the Corus Engineering Steels Pension Scheme (CESPS) about the security of the schemes. Following these discussions, the Company agreed to increase contributions to the BSPS Main Section from 10% to the full actuarial headline rate of 12% from the date of acquisition until 31st March, 2009, and to procure that its contributions to the BSPS will not be less than 10% for the period up to and including 31st March, 2012. The Company also agreed to contribute £13.5 million per annum over two years in support of acceleration of the BSPS investment de-risking strategy and to make a cash injection of £126 million to meet the funding deficit on an IAS19 basis in the CESPS.

The next formal valuations of the BSPS and CESPS are scheduled to take place as at 31st March, 2008 and
5th April, 2008 respectively.

The Stichting Pensioenfonds Hoogovens (SPH) scheme is the principal pension scheme of Corus in the Netherlands. It is a defined benefit scheme and contributions in FY 2007-08, which can vary according to the funding ratio of the scheme, stood at 11% from the contributing company and 6.5% from members relative to gross pensionable earnings.

NatSteel
NatSteel employs over 3,000 employees across Singapore, China, Thailand, Vietnam, Malaysia, the Philippines and Australia. NSA has achieved many national accolades in recognition of its commitment to employees. It achieved the People Developer Standard in recognition of its quality people development practices and the Work-Life Excellence Award. The Company also won the Singapore Health Award (Gold) for three consecutive years.

p) Cautionary Statement
Statements in the Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations may be “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include economic conditions affecting demand/supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the Government regulations, tax laws and other statutes and incidental factors.