THE steelworks on Teesside is favourite to be axed by Corus as part of a radical revamp of its UK business, it has been claimed.

Newspaper reports said that the Redcar plant, which employs 3,000 people, has been earmarked for closure ahead of other vulnerable plants at Port Talbot, South Wales, and Scunthorpe.

Last week, Corus chief executive Tony Pedder resigned after reporting a fourth annual loss of £458m, following an abandoned merger and the failed sale of aluminium assets.

Corus has refused to put a number on the potential job losses, but chairman Sir Brian Moffat is reported to have said the planned restructuring would not involve as many cuts as last year's revamp of operations, which led to 6,000 workers going.

A spokesman said: "The company has given no indication of job numbers, or the size and impact of any capacity cuts at all."

Cutting 4,000 jobs would save Corus about £120m a year. Any fresh job cuts would come on top of the 10,000 jobs shed by the steel maker during the past two years.

The fate of the Teesside works will be decided over the next few weeks.

Members of Redcar and Cleveland Borough Council's Save Our Steel Campaign stood on Redcar High Street last Saturday handing leaflets to passing shoppers, appealing for public support.

They were joined by MP Vera Baird and MEP Stephen Hughes.

Coun George Dunning, deputy leader of the council, said: "Many people are angry, confused, and just generally do not know if they are coming or going, although all of them are well aware of the severity of the affect of the plant's closure on the area."

Council leader Dave Walsh said: "It is important to show the concerns of the local community have been reflected."

Meanwhile, union leaders have condemned the £550,000 pay-off for chief executive Mr Pedder.

His exit, with a year's salary, came as defiant chairman Sir Brian announced he would be staying to run the company until a successor for Mr Pedder was found.

Michael Leahy, general secretary of the Iron and Steel Trades Confederation, said the payoff was outrageous. "Corus employees fear for their jobs, yet the chief executive gets a half-a-million pound pay-off. It is a high reward for failure," he said.

But Teesside MP Ashok Kumar said the wrong man had resigned and that it should have been Sir Brian who had left the beleaguered company.

Calling for the Corus chairman to be stripped of his knighthood he said: "I had a lot of respect for Tony Pedder. I can't praise him enough for trying to do the best for the company in difficult circumstances.

"Sir Brian would have done everybody a favour if he had gone."

A campaign to save steelmaking on Teesside was due to be launched yesterday, when business leaders from across the region gathered for an emergency meeting called by the North-East Chamber of Commerce.

At the meeting at the South Tees Business Centre, South Bank, they were to be asked to support the chamber's campaign to persuade Corus not to turn its back on the region.

Rob McMullen, the chamber's area manager for Teesside, said "This meeting will get the ball rolling. What we want to do is move away from the emotional side of this and come up with a very strong business case to present to Corus as to why they should stay here."