AFTER SSI finally succumbed to unsustainable debts, Business Editor Andy Richardson asked why the firm wasn't helped earlier.

IN its final few days SSI had run out of money to buy ink cartridges for printing out security passes.

If that wasn’t a sign that the game was up then I don’t know what is.

As the scale of SSI’s cash crisis enters the public domain the question being put to ministers, suppliers and local managers is – why was this allowed to go on for so long?

It has been an open secret for the last three years that the Thai-owned steel firm had an appalling record for settling its debts. They would often wait until a company was on the verge of submitting a winding-up order to the courts before paying what they owed. It was ironic therefore that it was the SSI board itself – rather than a disgruntled supplier or subcontractor - which finally applied to the court to wind up the company.

That decision led to PWC being appointed to support the official receiver yesterday afternoon and it will help decide how best to get value out of the firm’s assets.

PWC, which has been working as advisor to SSI for some considerable time, will be well placed to decide whether to accept an offer by County Durham coal and transport firm Hargreaves Services to step in and run the Redcar Coke ovens and keep the site ticking over.

Esh Winning-based Hargreaves is one of SSI’s main creditors. It is a powerful business and should be robust enough to survive the fall-out from SSI’s collapse even if it doesn’t recover all of its debts. But many smaller creditors will not be so lucky. Some will go to the wall or be forced to lay-off staff.

It is understood the steel firm owed North–East companies about £50m as part of UK debts totalling more than £120m. Electricity supplier EDF and Durham City-based Northumbrian Water both threatened to disconnect supplies to the Redcar site as SSI repeatedly defaulted on payment plans. North-East companies put up with this behaviour largely because everyone was desperate for SSI to succeed. The goodwill in the local business community to keep iron and steelmaking going was staggering and something that SSI was more than happy to exploit.  

The culture of stretching the patience of suppliers to breaking point of was managed by the Thai owners, while the North-East bosses, Cornelius Louwrens and his predecessor Phil Dryden, were largely powerless to do anything other than run the plant.

Amid the financial chaos the production side of the business was something the Redcar workforce can be proud of. Since it restarted a week after Easter Sunday 2012 the works set a succession of output records. Nine million tonnes of slabs were made and shipped via Teesport to Thailand, Turkey, Germany and the US. There was a market for Teesside-made steel. It is easy to get misty-eyed about its history of being used to build bridges that spanned Sydney Harbour or the Tyne - but it also had a place in the 21st century. There are cars running on the streets of Bangkok that were made with steel from SSI Redcar.     

It was undone by falling prices. The slowdown of China’s economy took the edge of its voracious appetite for homemade steel and it looked elsewhere for export markets. China’s ability to supply cut price product worldwide sent prices tumbling so quickly SSI went from selling slabs for more than $500 a tonne to about $300 without selling any in the $400 range.

SSI president Win Viriyaprapaikit – a hero four years ago - has been vilified in recent days. His decision to ignore his Tees workforce while they endured the agony of not knowing if they would be paid is unforgivable. But he bought the plant when no one else wanted it and with a bit more luck he could have made this a success.

I asked steel minister Anna Soubry why hadn’t the government intervened at SSI earlier.

She replied: “We only know what people tell us. How the hell do we know they haven’t paid their bloody employer’s liability insurance? Thank god Cornelius rang BIS (Dept for Business Industry & Skills) when he did.

"There are a lot of businesses in Britain and we can’t be expected to know what is going on in all of them.”

You would have thought that the North-East's last remaining steel plant, which hit the headlines last year for defaulting on a £10m payment to the local council, would have attracted the attention of Whitehall before it was too late.