Britain’s Industrial Future
(2 years ago)
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Bill Esterson (Sefton Central) (Lab)
I would like to start by giving apologies on behalf of the shadow Secretary of State, who is unable to be here today for personal reasons.
The motion in my name and in the names of my right hon. and hon. Friends should be self-evident. We want to see the great British industries that have shaped our nation last long into the future, securing our transition to net zero while bringing the jobs and skills so desperately needed in many of our communities. Those skills need to be skills of the future. That is why Labour is committed to 100,000 extra apprenticeships each year and flexibility in the use of the apprenticeship levy to support the training of existing workers. This Government claim that they want to level up the country, but can they deliver well-paid jobs in the areas of the country that they claim to care about? Sadly, it seems that those promises, as we have seen with so many other Conservative promises, are simply not worth the manifesto they were written on.
Jonathan Gullis (Stoke-on-Trent North) (Con)
Will the hon. Gentleman give way?
Bill Esterson
I will give way shortly.
Today, many of our industries, including steel, car manufacturing and shipbuilding, are facing an existential threat from spiralling energy costs, cheap imports and inflation. To make matters worse, they are also facing an indifferent Conservative Government. While other nations have had the foresight to retain a competitive advantage and invest in future technologies, here in Britain the Conservatives are happy to watch decades of expertise and reputation go abroad, along with the high-quality jobs that underpin our industrial communities.
Before the Minister blames international challenges, let us just remind Conservative MPs that this country is uniquely exposed to global economic problems. That is why the Bank of England has described UK-specific factors as behind the high interest rates that threaten homeowners and businesses with higher borrowing costs. The Conservatives have presided over 12 years of low growth, low investment and low productivity. Business investment under this Government is the lowest in the G7. We are the only G7 country where the economy is contracting, and the only one where the economy has not recovered to pre-pandemic levels. The Conservatives crashed the economy and they do not have a plan for recovery. Meanwhile, according to the latest Office for National Statistics business survey, a fifth of businesses say that uncertainty about demand and business prospects is holding back their investment plans. We can see what the former Chancellor meant when he used the phrase “vicious cycle of stagnation”.
Mark Tami (Alyn and Deeside) (Lab)
Does my hon. Friend agree that, although other European countries have recognised the energy costs facing the steel industry, this Government have done absolutely nothing about them? It is a major problem facing the industry. Although the long-term future might be hydrogen, as we hope it is, it will not happen without the Government—hopefully a Labour Government—putting in the investment needed to ensure it happens.
Bill Esterson
My right hon. Friend is right to speak on behalf of the steel industry, which faces an existential crisis and may well depend on a Labour Government coming to the rescue.
Emma Hardy (Kingston upon Hull West and Hessle) (Lab)
Does my hon. Friend share my frustration that the Government are playing hokey-cokey with Northern Powerhouse Rail, first putting it in their manifesto and then taking it out under Boris Johnson, then putting it in under Liz Truss and taking it out again under Rishi Sunak?
Madam Deputy Speaker (Dame Rosie Winterton)
Order. The hon. Lady knows she must refer to other Members not by name but by constituency.
Emma Hardy
I apologise, Madam Deputy Speaker.
Does my hon. Friend the Member for Sefton Central (Bill Esterson) agree that, if we want to deliver an industrial strategy, we need Northern Powerhouse Rail to be delivered in full?
Bill Esterson
I completely agree with my hon. Friend. She is confused because we have had so many Conservative Prime Ministers in the last few weeks that it is hard to keep up. Like her, I want to see Northern Powerhouse Rail linking my constituency on the west coast with her constituency on the east coast, providing economic benefits all the way along the route.
Bill Esterson
I will give way. Perhaps the hon. Gentleman will apologise for supporting a Government who crashed the economy.
Jonathan Gullis
The hon. Gentleman said he would come back to me when I sought to intervene on his talk of jobs in areas that we promised to level up, such as Stoke-on-Trent. He will, of course, welcome the 500 brand new Home Office jobs that have come to Stoke-on-Trent thanks to the Conservative Government, the 9,000 jobs that have been created thanks to the Conservative-led Stoke-on-Trent City Council under Councillor Abi Brown, and the 1,700 jobs at Chatterley Valley West that the Labour council opposed in May’s elections.
Bill Esterson
Unfortunately, the hon. Gentleman does not understand that 12 years of low growth, low investment and low productivity mean that places like Stoke-on-Trent have been hit very badly by this Conservative Government.
Where has 12 years of Conservative Government left British industry, not least in places such as Stoke-on-Trent? Manufacturing has seen the worst output over three months since the 1980s. Anyone who genuinely wants to turn around the UK’s poor economic performance cannot discount the role of industry in our economic growth. It is not a question of being either a service-led or a manufacturing-led economy. Successful economies are a combination, and successful industries are a combination, too. Good manufacturing depends on the services that support production.
Labour knows the value and understands the crucial role of our industrial base in delivering economic growth, which is why we have outlined our industrial strategy to give businesses certainty that they can invest alongside Government to safeguard our world-class industries. Economic strength needs partnership between Government and market, and between business and worker. Our new industrial strategy has partnership at its core, because partnership is how we ensure strong, secure growth and a fairer, greener future.
Our plans for a national wealth fund to invest in our great industries will play a crucial role, alongside businesses and trade unions, in delivering the certainty that investors and workers need. Labour’s plan will bring businesses, workers and trade unions together to safeguard the future of an industry that is the pride of communities across the country. I am talking, of course, about steel.
What we need is not crunch crisis talks and random nationalisations but investment in our great industries, with a real plan to secure our steelmaking future through a partnership to invest in the technology that our steelmakers need to export green steel around the world. But for 12 years the Conservatives have failed to back Britain’s steel industry. The Government have let the industry decline, with jobs offshored and communities damaged. While Governments around the world have been committed to their domestic industries, with long-term strategic investment in green steel production, the Conservatives have failed to invest in the transition, have attempted to weaken safeguards that protected our steelmakers from being undercut by cheap steel imports and have splashed tens of millions of pounds on imported steel to build British schools and hospitals.
Labour will make different choices. We will put UK steel at the heart of our wider industrial policy, building British wind turbines and railways, and investing in carbon capture and storage, and hydrogen infrastructure. I wrote to the Secretary of State two weeks ago about the concerns of the steel industry in this country. As he has not replied to my letter, perhaps the Minister winding up this debate will tell us what action the Government are taking to support this core industry.
Holly Mumby-Croft (Scunthorpe) (Con)
Would a Labour Government be looking to support the steel industry in the same way as Labour did between 1997 and 2010: by halving the number of workers in the industry?
Bill Esterson
The hon. Lady should perhaps take more care about how the Chinese are threatening to pull the plug on steel production in her constituency right now.
John Penrose (Weston-super-Mare) (Con)
The shadow Minister mentioned green steel. Do the Labour party’s plans include anything to do with a carbon border adjustment mechanism, which would, not just for steel, but all heavy energy using industries, level the playing field between British energy users, particularly manufacturing industries, and their cheaper competitors elsewhere in the world, who have cheaper energy costs? Is that part of the Labour party’s plans?
Bill Esterson
Perhaps the hon. Gentleman should be asking the Minister that question rather than me. [Interruption.] He has told me he is going to ask the Minister in a minute, and I look forward to the answer. Our view is that we have to respond to the fact that the EU is already doing this and we are clearly going to have to take action to safeguard the steel industry in this country. So I would be very interested in what the Minister says and whether it is consistent with what I have said.
Stephen Kinnock (Aberavon) (Lab)
My hon. Friend is making an excellent speech. Does he agree that what Conservative Members seem to be failing to recognise is that they have had 12 years to deal with the massive disparity in electricity costs between ourselves and our nearest competitors? There has been a total failure to have a procurement strategy that works for the UK steel industry and a complete absence of any action to support the transition to net zero. So rather than us take any lectures from Conservative Members, it is time they showed some humility and actually started to take some decisions about this vital foundation industry.
Bill Esterson
I am extremely grateful to my hon. Friend, who has led the steel MPs on this side of the Chamber, and has often led cross-party as well, in fighting the cause of steel communities. As he says, a core foundation industry is crucial to jobs and prosperity; to our national defence and security, with its role in procurement in defence; and to decarbonisation for climate security. It is right that we should be supporting our steel industry and our other core industries.
Jessica Morden (Newport East) (Lab)
Does my hon. Friend agree that it has not helped that since 2010 we have had 11 Ministers responsible for steel, including six in the past few years alone? It is impossible for the industry and unions to have an ongoing dialogue with the Government for a long-term vision for steel.
Bill Esterson
My hon. Friend is absolutely right about that, and I suspect that even if Ministers will not admit it publicly, they would say so privately too. I mentioned that I wrote to the Secretary of State two weeks ago. I am disappointed that I have not had an answer sooner, given the scale of the challenge and the emergency facing so many parts of the steel industry.
Holly Mumby-Croft
The hon. Gentleman mentions the letter that he wrote two weeks ago. I am grateful to have that support even if it is only a letter and very late in the day. Can he set out in a little more detail what else he has done? In particular, can he say what he did to help with the two extensions of the safeguard, because I do not remember discussing that with him at the time?
Bill Esterson
I would have hoped that, as a Conservative MP, the hon. Lady would have been talking to her own colleagues. I hope that her ministerial colleague will have heard what she said, and that she will join me in calling on him to respond to the requests of the steel industry. [Interruption.] The hon. Member for Stoke-on-Trent North (Jonathan Gullis) can sit there and heckle all day—he does quite a lot of that—but the honest truth is that we do need cross-party working to deliver for steelworkers. I am happy to support the call of the hon. Lady, as I am the calls of my colleagues who have spoken in this debate.
On the automotive sector, it must make sense for the Government to support workers at one of the most productive car plants in Europe. That is why the Government should be working with BMW at Cowley to give it assurances that they support electric car production in the UK. They should be working with the car industry to support the transition to electric vehicles, not sitting on the sidelines while our great automotive sector falls behind our European competitors. While we have one gigafactory in operation, Germany has five, with a further four in construction. France and Italy are set to have twice as many jobs in battery manufacturing as us by 2030. The precarious future of Britishvolt is incredibly worrying for the local economy, risking up to 8,000 jobs, but it also further jeopardises our gigafactory capacity as a country. As part of our plans for a national wealth fund, Labour will part-finance the creation of three new additional gigafactories by 2025, with a target of eight by 2030.
Turning to shipbuilding, a successful strategy means making and buying more ships here in Britain, such as the Fleet Solid Support Ships, rather than seeing lucrative defence contracts built abroad. It is, of course, a very important way of supporting our steel industry. Investing in sovereign defence capability is a matter of national security as well as being good for jobs, 6,000 of which are at the UK’s high quality shipyards from the Fleet Solid Support Ship contract alone.
A hallmark of each iteration of this Conservative Government has been to act in the heat of the moment and lurch from crisis to crisis. The revolving door of Ministers, the seemingly endless soap opera, the unedifying sight of Conservative MPs eating bugs in the jungle mask a much deeper problem. The Conservatives are unable to offer British industry the bedrock on which it needs to grow. They do not have an industrial strategy that can last the term of a Minister let alone the turn of the century. Whether that is ideological opposition—the mistaken belief that Government should get out of the way—or pure incompetence, it is clear that the Conservatives are failing British industry.
Bill Esterson
I suspect the right hon. Gentleman is going to tell us that it is the former.
John Redwood
I support what the shadow spokesman says about wanting more made here; I quite agree. On the gigafactories that Labour is now sponsoring, what demands would it make of those putting forward the idea? The issue is: should they not have some customers and a plan that will work. What does he want from them?
Bill Esterson
The Government really should have done their own due diligence before investing. If the German, Italian or French Governments have made those investments because they have a strategic interest in their car industries, it must make sense for us to do the same here.
Paul Holmes (Eastleigh) (Con)
The shadow Minister outlines this Government’s failure or apparent inaction on shipbuilding in the UK, but can he bring himself today to congratulate the Government on announcing the five Type 26 frigates to be built in the UK, on the Clyde, which will mean jobs and prosperity for not only Scotland, but the whole UK. Perhaps he might like to correct the record and mention that?
Bill Esterson
I am grateful to the hon. Gentleman for asking the question, because it reminds us all that the Conservative Government have cut the number of ships from 13 to eight—so I would be careful about claiming that as a great big success story—and they still have not made a decision on the Fleet Solid Support Ships.
With Labour, Britain can become a global leader in producing electric cars and in self-sufficiency in renewable electricity generation. Meanwhile, the Conservatives continue to drag their feet and retain the moratorium on onshore wind. When the Prime Minister was asked about onshore wind, he answered by talking about offshore wind. It is almost as if he did not understand the difference.
Onshore wind is one of the cheapest forms of energy, and we will double its capacity. We will treble solar and quadruple offshore wind production. We will support nuclear, tidal and hydrogen, because they are all part of a low-carbon future, but not least because Labour will be an active Government, willing to champion British industry and help to create the jobs and prosperity of the future.
Our plans for renewable electricity generation will mean cheaper bills for industry and households. They are being drawn up with business, informed by the evidence presented to us by employers and trade unions alike. Partnership, planning, investment and certainty: those are the elements industry needs to succeed. They are the foundations of the framework that industry will be able to rely on alongside a Labour Government.
Alan Brown (Kilmarnock and Loudoun) (SNP)
On energy policy and lower energy bills, the shadow Minister mentioned nuclear power. Sizewell C nuclear power station is going to cost something like £30 billion in capital expenditure. The UK Government’s impact assessment, when the capital costs and finance and borrowing costs are taken into account, estimates that it will cost £63 billion. Does he really think that is a good way to spend money?
Bill Esterson
The way the Conservative Government reached the deal was not good value for money, and we certainly should not do that again, but nuclear is a key part of our transition to renewable electricity.
When I visit companies developing new technologies, they are excited by the prospects and the ideas they are developing. Whether on decarbonising air travel, installing insulation in millions of homes, as our energy efficiency plans will do, or our world-class defence companies delivering economic prosperity while keeping us safe, all the businesses I meet want to work with Government. They want a Government who offer stability and are a willing partner, who will lead the world in renewable technology, who will herald the vanguard of new electric vehicles and will supply the world with cutting-edge green steel.
The Conservatives have failed over the past 12 years. Their answer is to offer the slowest growth in the OECD over the next two years after crashing the economy. It does not have to be this way. Britain’s best years really can lie ahead. Britain really can be the best place to start and grow a business. The British Government really can be the partner to industry, ensuring that we make, buy and sell more in Britain. With our industrial strategy and our green prosperity plan, Labour will ensure that, together with business and the workforce, we really can deliver prosperity through partnership.
The Minister of State, Department for Business, Energy and Industrial Strategy (George Freeman)
It is a great pleasure to serve in this debate and to have my first outing at the Dispatch Box as the returned Minister for science research, innovation and technology at the Department for Business, Energy and Industrial Strategy—a name written proudly on the side of the building—in order to refute the litany of woe and failure that those on the Opposition Benches love to reel out, to paint a picture of a British economy that the businesses around this country would recognise and understand, and to set out in some detail the plans we have to support not only the industries of today, but the industries of tomorrow, for which this country is leading in creating the framework globally.
I look forward to a good debate, not least about the depression of the Opposition’s motion, which says very little about their own positive plans to develop an industrial sector for the 21st century, but simply looks to print a cheap leaflet for distribution on the doorstep. We can do better than that, and I hope that we will this afternoon.
As Minister for science, research and innovation in technology, my mission is to make the strategic shift in this country’s economy. The Labour party, in its long period in office, seemed to delight in—I remember the “Deputy Prime Minister” saying he was profoundly relaxed—all the deregulation in the City, the move to a service economy and deindustrialisation. This Government are absolutely committed to taking the crash of 2007-8 under the Labour Government, the difficult fiscal situation afterwards, the pandemic and the emergency in Ukraine as the wake-up call that they are to invest more in our industries of tomorrow and today, to develop our industrial resilience, to support the R&D for tomorrow’s sectors, and to support our leadership in net zero. I would like to think that the Labour party would celebrate that. The truth is that British industry is leading the way in net zero in this country, and that is something we should be proud of. I will come to the detail of that in due course.
George Freeman
I will make some progress in my opening remarks and then I will give way to the hon. Gentleman.
In my specific role and portfolio, my job is to support the industries of tomorrow. In life sciences, I set out with the then Minister the first 10-year life science strategy in this country. We launched the genomics programme, NHS digital and accelerated access, and we laid a lot of the foundations for this country’s success in the pandemic. Last year, we launched a 10-year space strategy for commercial leadership in the space sector, and we are now in the process of implementing it.
We have set out a 10-year plan for fusion, and we are investing, through the UK Atomic Energy Authority, in the ground-breaking technology at the Culham Centre for Fusion Energy. We announced this summer that we are moving that to Nottinghamshire and creating the world’s first industrial deployment of fusion technology at commercial scale over the next 10 to 15 years.
We are setting out a quantum strategy. On Friday, I was with the quantum industry, which is applauding us; we are No. 1 in Europe in the quantum industry and investment. That is a partnership between big companies—Toshiba, BT, BAE Systems and many others—and our very fertile ecosystem of small companies and universities. Similarly, I was proud, as the then Minister, to launch the UK’s first industrial strategy for agri-tech.
Forgive me, then, if I do not take any lectures from the Labour party on the lack of an industrial strategy. Far from it, the former Member for Hartlepool and “Deputy Prime Minister” paid tribute to the Conservative party, to me, the then Chancellor and the then Minister, David Willets—who is now in the other place—for leading the thinking on a modern industrial strategy for a modern economy.
In truth, in the last few years that work has inevitably been interrupted, first by the pandemic—I am proud that the Conservative party put in £400 billion of business support for industry—and secondly by Ukraine, which has been a wake-up call to the world about the resilience of industrial supply chains. We have worked head and shoulders in the last year to beef up those industrial supply chains to protect British industry from that vulnerability, and we continue to do so.
George Freeman
Let me finish this point.
Thirdly, the tightening of the global energy markets has hit many energy-intensive industries hard. We have announced £25 billion of support for the next six months. That is far from the doom and gloom of the motion, which, for anyone who reads it, paints a picture of this Government having no strategy or policy for industry, which is complete rubbish.
Grahame Morris
I am grateful to the Minister for giving way on doom and gloom. There was a mention earlier of fleet solid support ships, which we on this side of the House have argued for many years should be built here for strategic reasons, with steel manufactured here.
May I ask about rail and the home of the railways in the north-east? In my constituency, Vivarail—a world-beating, self-charging all-electric train manufacturer—is starved of Government support and investment. It could be a beacon for the future, so why is it not on the Minister’s list of shining examples?
George Freeman
The reason it was not on the list is that I was listing all the industries of tomorrow. I will come to the specific points he makes. The biggest customer for steel in this country is our rail sector, and we are proud that the UK rail industry, into which we are pouring an unprecedented level of investment, is a major user of British steel. I will come to the steel industry in a moment.
The motion paints a picture of doom and gloom and the collapse of manufacturing. It is time to put that stale old Labour trope to bed. The UK is still the ninth biggest manufacturing country in the world. Manufacturing this year contributed £205 billion in gross value added to the UK economy. We are the fourth largest manufacturing economy in Europe, supporting almost 2.5 million jobs.
Under the last Labour Government, manufacturing jobs had been haemorrhaging. We stopped that in 2010 and, through major investment of the sort that I just set out, we have turned around this country’s manufacturing sector, which is now much more advanced. Again, I am surprised that Labour Members are not congratulating us on that. Manufacturing jobs were collapsing in this country, but 84% of manufacturing now takes place throughout the country, outside London, not just in the old industrial belt, but in the space economy in Cornwall and in Glasgow—I thought that Scottish National party Members would cheer that. There is the north Wales energy corridor, the south Wales compound semiconductor cluster and the Warwick robotics cluster. Our manufacturing economy is highly advanced, highly competitive and decentralised.
George Freeman
I will come to steel, shipbuilding and automotive shortly. I had not mentioned the hon. Gentleman’s rail point because I was highlighting the industries of tomorrow.
Stephen Kinnock (Aberavon) (Lab)
Does the Minister know how many tonnes of British steel there are in a single wind turbine, onshore or offshore, in our country?
George Freeman
I do not have that figure at my fingertips, but I have a funny feeling that the hon. Gentleman does. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) will respond on that later.
Paul Howell (Sedgefield) (Con)
The Minister has talked about the space and science-led businesses around the country. On the north-east, in response to the hon. Member for Easington (Grahame Morris), we should not forget the tremendous things that are happening at NETPark in Sedgefield.
George Freeman
Indeed, fantastic things are happening at NETPark. One would think that the Labour party, which dominated County Durham politics for decades and seemed to indulge in the poverty up there, would celebrate the phenomenal turnaround in the north-east. It is one of our leading manufacturing regions. NETPark is home to Kromek and Newcastle is home to QuantuMDX. That is a great story of British manufacturing driving an advanced economy in the areas that were blighted by painful deindustrialisation. I am proud that the Conservative party is in the vanguard of that.
Alex Cunningham
There is no doubt that we have new manufacturing to celebrate in the north-east, but Teesside’s steel industry is a shadow of its former self. It has a few hundred jobs, instead of the many thousands that existed a few years ago, before the Government abandoned us. Does the Minister agree that we should invest in Teesside steel now and use its product for the new industry jobs that we are promised?
George Freeman
That brings me to steel, and the hon. Gentleman makes an important point. There has been real pressure on the steel industry in the past 15 to 20 years. Global economic conditions are hugely challenging for all domestic steel sectors. There has been massive overcapacity, unfair overseas subsidies and steel dumping. The real issue is that global steel production has more than doubled since 1995 and China is by far the biggest contributor to that growth. In 1995, China accounted for 13% of the world’s steel production. By 2019, that had risen to 53%. There has been a phenomenal change in the global steel market.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
I have been in this place 10 years today and I have worked with my local steel company since I was first elected. It has consistently raised the same issues with me: competitive electricity prices for the green steel it produces and ensuring that the industries of the future, particularly green industries, use UK steel. What exactly have the Government done to ensure that prices are competitive and that UK steel is used in those green industries? They have not done enough.
George Freeman
The hon. Gentleman makes an important point about the challenge. We have done a lot—let me share that with him.
George Freeman
I will deal with the specific point. Our ongoing support for the steel industry this year includes more than £800 million in relief for electricity costs, in addition to the energy bills relief scheme. The sector can apply for help with all sorts of energy efficiency, with decarbonisation and low-carbon infrastructure. More than £1 billion is available in competitive funding for the industry in that sector alone.
Several hon. Members rose—
George Freeman
Let me just deal with this point.
We are investing more than £600 billion to transform our country’s infrastructure—roads, rail, broadband and more—and we plan to procure 8.5 million tonnes of steel as part of that over the next decade; the hon. Member for Cardiff South and Penarth (Stephen Doughty) touched on procurement. We published an updated steel pipeline in June 2020, to help the industry plan ahead. The value of UK steel procured by the Government for major public projects in 2021, which I checked before coming to the debate, was £268 million—an increase of £160 million from the previous year. The steel procurement taskforce, which we set up as a joint working group between Government and the steel industry, published seven recommendations in February this year, and those are being implemented through updating the Cabinet Office procurement policy note. As the hon. Member will see—he asked a good question—we are taking serious steps on procurement.
In 2021, the Secretary of State for Defence acquired specialist steel producer Sheffield Forgemasters, with £400 million of investment over the next 10 years, and Sheffield Forgemasters is working with other companies, including Rolls-Royce and the Canadian company General Fusion, on the development of nuclear power generation. In March this year, we successfully secured an expansive removal of US section 232 tariffs on UK steel and aluminium products, which means that UK steel and aluminium exports to the US can return to levels not seen since before 2018. We have also extended our steel safeguard measures for a further two years. I simply do not accept, and I do not think anyone listening to the debate would say, that the Government have done nothing and are doing nothing on procurement. It is simply not true.
Andy McDonald (Middlesbrough) (Lab)
I am grateful to the Minister for giving way. I have heard what he has to say, but what does he say to the people of Teesside about his Government’s inaction in 2015? The Italian Government intervened at the Ilva plant in Taranto and came to the rescue of 25,000 workers. The French did the same in Florange, but this Government did absolutely nothing to protect our core industries at Redcar—and we have not forgotten it.
George Freeman
I would point out that last week, Green Lithium announced the UK’s first large-scale merchant lithium refinery and the first such refinery in Europe, to be built in Teesport, supported by the automotive transformation fund.
John Penrose
I want to ask the Minister the same question that I asked the hon. Member for Sefton Central (Bill Esterson) about a potential solution to the problems of high electricity costs faced by energy-intensive industries such as steel, which we have been hearing about from Opposition Members. Would a carbon border adjustment mechanism, which the Government have already consulted on and committed to in principle, help to level the playing field between British energy costs and those abroad, therefore making British heavy industry—particularly energy-intensive industries—far more competitive on the international stage?
George Freeman
My hon. Friend, as ever, makes a very interesting policy observation; as Minister for science, I will not accept it at the Dispatch Box, but I will raise it with the Ministers for industry and for energy.
Alan Brown
The Minister mentioned nuclear power. He heard what I said about costs earlier, but it is also reported that the Government are taking a 20% share in Sizewell C. Does that mean the Government are going to borrow £5 billion or £6 billion to pay for their 20% share of Sizewell C?
George Freeman
How interesting to hear the SNP take issue with—[Interruption.] The hon. Member asked the question, so I will answer it. We are determined to make sure that, unlike parties on the Opposition Benches, we invest properly in new nuclear in this country, so that we have a resilient, clean and secure energy system. If that means an active industrial strategy to ensure we are able to do it, we are doing it. It would be nice to hear the SNP Government in Scotland take a similar approach to their future and to nuclear in this country, which is vital for the next few years as we get through this global tightening in energy.
George Freeman
No, I shall make some progress on this point about the automotive sector, which is also mentioned in the motion. The UK’s auto sector is hugely competitive globally. It is export-focused and has a very strong research and development base. In the last 20 to 30 years, it has transformed from what it was in the 1970s to a highly competitive and technologically advanced R&D-based sector. It is also in the vanguard of the transition to net zero, and the UK is well placed to seize those opportunities because of the Government’s efforts, as we are pursuing an active industrial strategy for net zero in industry.
The automotive-related manufacturing sector is worth £58 billion to the economy and typically invests around £3 billion each year in R&D—£3 billion in R&D from the sector alone. There are 155,000 people employed in automotive manufacturing in the UK in 2021. That is 6% of total UK manufacturing. [Interruption.] Opposition Members may laugh about the success of the British automotive sector, but this is a tribute to business and industry adaptability and the Government’s partnership in setting out a framework for the net zero transition.
Decarbonising transport is already starting to create thousands of jobs in green industries. The production of net zero road transport vehicles is on track to support the development of 72,000 jobs worth up to £9 billion to the economy. The Government have proven loud and clear that we can deliver a green transition and growth—something that all Opposition parties bitterly insisted was not possible.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
The Minister talks about the decarbonisation of transport. Of the 4,000 buses that the former Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), promised nearly three years ago, how many are currently on the road in England?
George Freeman
I will have to check the exact number. I am surprised that the hon. Gentleman did not mention Aberdeen’s leadership. With our support, Aberdeen is a hydrogen hub and there has been the creation of hydrogen hubs in Teesside, Harwich and all around the country. We are investing in another industry of tomorrow—green and blue hydrogen. His question is revealing. The motion suggests that the Government are doing nothing at all about hydrogen, but far from it. We are investing in the infrastructure for the hydrogen of tomorrow.
John Redwood
Is there a danger that the UK could end diesel and petrol vehicle production too early compared with competitors—before we have a large electric car industry up and running? Would that not be bad news for our industry?
George Freeman
My right hon. Friend makes an important point about ensuring that, as we lead on the delivery of the net zero automotive sector, we get the balance right, so that we are not unrealistically expecting consumers to make the transition too fast or, indeed, undermining our leadership in that sector. That is a fine balance that the Government are committed to striking. We are determined to lead the way in demonstrating green growth in pursuit of net zero, but we want to ensure that we capture the industrial leadership in that sector.
In the automotive sector, we have again made significant investments. We have invested more than £1.2 billion to support innovative projects through the Advanced Propulsion Centre. The projects that it has funded have helped to create more than 50,000 jobs and save 277 million tonnes of carbon dioxide. Last month, we announced a record £200 million for the Faraday battery challenge. We have worked closely with Nissan and just announced a £1 billion investment to create a north of England electric vehicle hub in Sunderland that will safeguard 6,500 jobs. There have been investments of £227 million in Ford in Halewood, more than £100 million in Stellantis at the Vauxhall plant in Ellesmere Port, and £2.5 billion in Bentley—those are major investments from an industry that is growing in this country with Government support. It would have been nice to hear the Opposition at least pay tribute to some of that success.
In the EV supply chain, we are actively investing in pursuit of our industrial strategy for green growth. The active travel fund has supported that £1 billion electric vehicle hub. We have also supported Pensana’s £145 million investment in East Yorkshire. Through the ATF, we recently supported a £60 million investment to develop hydrogen technologies with Johnson Matthey. Far from the Government abandoning our commitment to industry, we are doubling down on our commitment to help the existing industries of today to make the transition, and to support the industries of tomorrow.
The shipbuilding industry in this country, which Opposition Members suggest has been decimated, actually employs 42,500 people and is worth £2.8 billion. It is a major sector. Naval orders through the Government remain an important driver of its prosperity. In 2020, the Ministry of Defence spent £3.8 billion on shipbuilding and repair, which directly supported 22,000 jobs around the economy. Over the last decade, we have seen once great names in shipbuilding, such as Harland & Wolff, struggle, which puts that heritage at risk. Under the ownership of InfraStrata, however, Harland & Wolff is now strong again; that resurgence is part of a general trend of global consolidation in the industry.
We have seen how the symbiosis between MOD, naval and commercial buildings brings improved competitiveness, as businesses such as Cammell Laird deliver large commercial vessels alongside the Royal Fleet Auxiliary commitments. I am proud, as the Minister for Science, that the royal research ship Sir David Attenborough is one of the ships that has been built of British steel. The commissioning and delivery of the new aircraft carriers has been a massive shot in the arm. At the same time, we have seen big advances in key technologies, such as aluminium hull design and the application of robots for automated welding. That programme is also driving technological leadership. In 2019, ship boat repair maintenance was worth £2.6 billion to the economy.
I do not think it is fair to suggest, as the motion does, that this Government have neither an interest in industry nor a policy for industry, and that we are abandoning industry—far from it. Not only are we helping our key industries deal with massive global challenges—the pandemic and the energy crisis—but we are actively pursuing an industrial strategy for the industries of tomorrow, and that is actively supporting clusters all around the country to drive levelling up and opportunity. It would be nice to hear the Opposition parties at least pay some tribute to the success of that private-public partnership and to the success and resilience of British industry.
Several hon. Members rose—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. Before I call the SNP spokesperson, colleagues will see that this is a very well subscribed debate, so I will have to put a time limit on. I will start with six minutes, but I warn that it may go down quite quickly.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Interestingly, the Minister kept using the phrase “industrial strategy” without acknowledging that the previous BEIS Secretary actually ripped up and abandoned the UK Government’s industrial strategy. So there is not an industrial strategy; there is just a series of ad hoc announcements of money and targets that are arbitrary. We do not have a coherent strategy that links it all together.
I should start by welcoming today’s news of the confirmation of the £4.2 billion order for the five Type 26 frigates awarded to BAE Systems at Govan and Scotstoun. Those ships will now be built in the dry because BAE has been able to commit to the £200 million factory that was previously promised by the UK Government some way back. It is not the number of frigates that was originally promised, but there is no doubt that the announcement today is good news for the workers in Glasgow.
That good news is in contrast to a couple of stories and events from yesterday. In the Chamber, the former Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for Camborne and Redruth (George Eustice), let slip what many of us had been saying for long enough, which is that the Australia and New Zealand trade deals that the Government signed are utter rubbish. Also yesterday, Bloomberg ran a story confirming that Paris’s stock market has now exceeded London’s stock market in value. These matters are interlinked. It is a combination of Tory free market ideology and Brexit, of course, and we continually see proof of the harm of Brexit in the UK’s performance compared with G7 and G20 countries.
There was a big lack of talk of Brexit in the contribution of the shadow Minister, the hon. Member for Sefton Central (Bill Esterson). Despite what we know of the harms of Brexit, Labour now says it wants to make Brexit work. Free movement of people has gone, the Labour leader tells us. We have recruited too many people from overseas into the NHS, he tells us. But the reality is that, when Labour has such a lead in the polls, it should be offering bolder plans, such as rejoining the single market, and certainly allowing free movement of people so we can grow the economy again. Right now the Labour position seems to be, “We won’t be quite as bad as the Tories”. That is hardly ambitious.
We have to be realistic: if we want to increase skilled jobs and the workforce, while continuing to recruit for the service sector, the hospitality industry, the NHS and so on, we need inward migration. There may be a legitimate debate about the fact that too many people have exited the workforce for various reasons, but the reality is that we currently have record low numbers of people seeking work compared with vacancies, so clearly immigration is required, and free movement of people with the EU is the logical step to achieve that.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
My hon. Friend is making a powerful point. Of course, we need people to staff industries—in my constituency, hospitality is crying out for people and the health industry is crying out for people—and we used to be able to count on EU citizens, but there are not the people there to replace them. It is vital for a country such as Scotland to have a different approach from the one taken by this Government and this place over immigration. Our historical problem has been that we have suffered from emigration, rather than immigration, and we need people in Scotland.
Alan Brown
Absolutely. It is all about keeping that balance of population, growing the workforce, growing the skills base, helping our businesses grow and growing the tax base as well, which creates a fairer economy for all.
For too long in the UK, deindustrialisation was deemed acceptable as long as the financial City was booming in London, but that has been the wrong strategy for decades now. It has left coalfield areas such as my constituency struggling, not to mention the loss of industry and manufacturing in the main town of Kilmarnock and the Irvine valley. That has been replicated in industrial areas up and down the UK. The Tories have arguably now recognised this with the so-called levelling-up agenda, but that is a slogan that admits all those years of failure in terms of deindustrialisation. In reality, it was just a political strategy aimed at the red wall seats. The levelling-up agenda is so ad hoc that nobody can define what it means in terms of outputs and measures, and it opens the way for more political chicanery.
It is clear that Brexit has produced challenges for the automotive industry: additional paperwork; and rules of origin which will become more challenging for the industry as times goes on. According to the Society of Motor Manufacturers and Traders, despite recent increases in sales, 2022 is on course to be the weakest for car sales since 1982—a 40-year low in sales as we move into recession in the UK and have inflation at a 40-year high. On car manufacturing, while we know there have been global supply chain issues and long lead-in times for parts, the reality is that there has been a drop in output in the UK compared with the rest of Europe. Only Germany has suffered a bigger percentage decrease in manufacturing output.
On wider industrial strategies in car manufacturing and EVs, we must address the electric vehicle charging roll-out. The Government have a target of 300,000 charge points installed by 2030. That means that, each year from next year onwards, 31,000 charge points need to be installed; that is because only 34,000 have been installed to date. When we consider that the cumulative total installed at present needs to be installed nearly every year for seven years to hit the target, we realise the Government do not have a coherent strategy to achieve that.
I welcome that the battery car sales market share has increased and plug-in vehicles now account for over 21% of new sales, but we need to make sure the lack of infrastructure does not stall sales and output of such vehicles. In small, independent Norway, last year, EVs accounted for 65% of market share.
Gavin Newlands
Does my hon. Friend agree that, in Norway and in Scotland—which has twice as many rapid chargers per head as England, including London—it was public investment by the Government that got that going, leading to a better system of chargers? Then the private sector was brought in. That is the way to go, rather than starting private, as the UK Government did.
Alan Brown
I absolutely agree. The Minister challenged us earlier to welcome public-private investment partnerships; I hope the Minister who winds up will welcome that investment in Scotland and that Scotland and Norway have shown how it can be done.
On the bus manufacturing sector, again, unfortunately, we have had a complete UK Government failure. Just yesterday, The Times ran a story saying that only six low-emission buses out of the 4,000 promised by the previous Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), have entered service in England. Of the promised £3 billion bus fund, 40% still remains unallocated, and only 341 orders have been placed out of the 4,000. It is therefore clear that urgent intervention is required to get manufacturing in the UK up and running. Even worse than that, the first ZEBRA—zero emission bus regional areas—contract was awarded abroad, to China. There is no scope in the current tendering process to assess added value of UK content and community benefit, which would help UK manufacturing companies. That is a complete failure by the Department for Business, Energy and Industrial Strategy.
In contrast, the Scottish Government have led the way on this. Three hundred buses have been delivered under the Scottish ultra-low-emission bus scheme, and almost the same number has now been delivered through the Scottish zero-emission bus challenge fund. However, the reality is that companies such as Alexander Dennis need to see more orders via UK Government funding. If they are talking about an industrial strategy and promoting UK manufacturing, they need to do something to get these buses made by UK-based companies.
The motion refers to net zero and creating jobs. Net zero has to be the future if we are going to save the planet. It should be part of a just transition for the oil and gas industry. With the right support for emerging technologies such as tidal stream, Scotland in particular can be a manufacturing and technology exporter. Green hydrogen needs to be supported in a much bigger way, given investments being made elsewhere in Europe.
In 2020, renewable sources provided almost 100% of the equivalent gross electricity consumption in Scotland, and that was despite the UK Government effectively pulling the plug on onshore wind for a six-year period. Scotland currently has the largest deployment of grid-generating tidal stream turbines, and there is the potential of up to 11 GW of electricity to be generated from tidal stream. Scotland is also leading the way on floating offshore wind. In terms of fixed offshore wind, ScotWind has the potential to develop more than 20 GW of offshore wind in the coming years. With the size of the wind farms being developed, there really is a chance of establishing turbine manufacturing in Scotland, so it is critical that all the permissions are put in place.
However, in Scotland we also have the paradox that Westminster holds all the levers of power in terms of main energy policy. The auction process and procurement rules all lie with Westminster. The setting of the grid charging regime and the regulator lie with Westminster. Borrowing powers to invest lie with Westminster. The ability to pull funding or prioritise projects such as carbon capture and storage lie with Westminster. That is underlined by the disgraceful fact that funding was pulled from the Peterhead CCS project and that the Acorn project is still classed as a reserve project despite having been the most advanced and rounded project overall in terms of CCS clusters.
It is Westminster who can decide on a pricing mechanism for pumped storage hydro or not and, so far, they have ignored the calls to sit down and discuss a cap and floor mechanism for electricity generated by pumped storage hydro. It is Westminster who have control of the consenting rules and processes under the Electricity Act 1989 and are prioritising another £30 billion of capital spend for Sizewell C nuclear power station. It is Westminster who squandered £380 billion of oil and gas revenues.
Despite that—bizarrely—we have Unionists right now seeming to take glee from the fact that not as many jobs may have been created by the onshore wind sector as was originally hoped. That is as much as anything down to procurement processes, which for years the SNP has called to be changed to allow for local content. Right now, we have Unionist glee as they believe that, somehow, Scotland’s renewables potential has been overblown or overhyped by politicians. I assure them that it certainly has not. A report prepared by the Landfall Strategy Group illustrates that pursuing offshore wind and tidal resource alongside a green hydrogen strategy could create up to 400,000 jobs by 2050 and £34 billion in gross value added. That is the sort of ambition required, and that seems to be deliverable only through independence and the full levers of power.
John Redwood (Wokingham) (Con)
I congratulate the Minister on a lively and informative speech. It was great to have a positive vision for the future from him. He rightly reminded us that many of the exciting new technologies and opportunities available to modern industry and business are being grasped by both the private sector and the Government working together. I congratulate him and his Department on that work. However, I urge him and the Department to greater efforts in the range of more traditional industries that are still very much industries of the future. We have a choice. If we make the right decisions on taxes, regulations, support frameworks and orders, we can produce more such things at home. If we make the wrong decisions, we will end up importing too many of them.
I start with energy. The Minister’s Department has a crucial role in organising our energy and the transition that it wants as well as ensuring that we have enough of the traditional energy forms when they are crucial to heating our homes and turning our factories. In this period of transition, we can do more to extract more of our own oil and gas. That is greener than importing it, because, in burning gas that comes down a pipe from the North sea, far less carbon dioxide is generated than if the gas were extracted somewhere else, transformed into liquid form and transported—at least half the CO2 is saved that would otherwise be generated. More importantly, that is a safer supply. Even more importantly, if we are still to have high taxes on it, we will collect those taxes. At the moment, the more we import, the more dead money goes out of our country to pay somebody else’s taxes, doubly burdening our industry with the extra cost of what are sometimes extreme market prices to secure the supply—when there is not a long-term contract—and extra transport costs that must be put into the equation for effective delivery.
I urge the new ministerial team to take up from where the old team were moving to and understand that there are quite a lot of good proven reserves out there now. Production licences could be granted in a timely way, and we could have more of our own import substitution and more secure supplies for the future. It is possible to work with the industry on existing fields so that maintenance schedules can be kept to a minimum and output can be maximised, particularly over a difficult winter. We all know that if anything goes wrong with the UK and European gas supply over the winter, it will be our industry that gets caught first; industry is very reliant on plentiful gas supplies for much of its important processes.
We must be careful about carbon accounting. I think a lot of us feel that it does not make a lot of sense to say that the heavy gas-using industries and other fossil fuel-using industries in the United Kingdom, such as cement, glass, ceramics, steel and so on, will be penalised because they are generating carbon dioxide in their process, only to substitute imports of those same products that will certainly produce more CO2, not only because of the long-distance transport, but quite often from the processes as well, as this country has often gone a bit further in more efficient processes than some import substitutes. So that, too, is an area that we need to look at very carefully.
On the car industry, I would like to expand a little on the intervention. Again, a difficult transition is under way and it can only go at the pace that the customers are willing to let it go. At the moment, as we have been hearing, a relatively small minority of the cars built in this country are full electric cars—something to do with price and range, and people getting used to the idea of the electric vehicle—and so during the transitional period we again have a choice: either we produce the diesel and petrol cars that people still want to buy, or somebody else does that and we end up importing them. Again, I do not think that that is a good course. I would not want to be ahead of some of the other leading car producers in the world in definitely ruling out producing vehicles that still sell well, when we have put a lot of investment collectively into developing more fuel-efficient vehicles, which have much less coming out of the tailgate.
My final brief point builds on one that the Minister eloquently made in certain contexts. We can do a lot more, as the Government are trying to do, with sensible purchasing of our own products. Of course, we do not want to buy products that are less good quality or too expensive. There has to be competition within the UK market to reassure the Government they are getting value, but just as we have always done with things like warships, so we can do for more essential products. We should give the home base the best chance and, if necessary, help people come in as major investors with their factories in order to do so.
Christina Rees (Neath) (Ind)
As a former Secretary of State for Wales, I am sure the right hon. Gentleman is aware of the very exciting global centre of rail excellence that is being built in Onllwyn in my constituency. It will be the only testing centre for futuristic trains and infrastructure in the UK. The Welsh Government have put in £50 million. Does he agree that his Government should honour their commitment to put in £30 million, so that it can be finished on schedule by July 2023?
John Redwood
The hon. Lady has made her own point very well and I trust Ministers will answer. I have not been privy to the documents on this particular project, so I have no idea how I can answer that and I do not know what the background is to the timing and the opportunity that may be presented. However, in general terms I am all in favour of more opportunities for Wales, as well as for England and the rest of the United Kingdom.
In summary, yes Minister, let us have more of it. Let us have more, cheaper energy produced at home. Let us have more steel, bricks and ceramics produced at home. To do that, it will require some actions, inspired purchasing and the right tax and regulatory regime so that we do not penalise ourselves needlessly over net zero and end up burdening the world with more CO2 and ourselves with more imports.
Several hon. Members rose—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. I will have to reduce the time limit to five minutes after the next speaker. Just a reminder that if interventions are taken, to keep to the time, as the right hon. Gentleman did. Otherwise, it takes away from others who have put in to speak.
Ian Lavery (Wansbeck) (Lab)
This debate is really interesting. In his introduction, the Minister mentioned that there is a litany of woe and failure in the Labour motion. Of course there is, because we have seen an abandonment of the business strategy from the Government. We have all experienced it. The Minister also mentioned the amount of money that the Government have given through the automotive transformation fund to Bentley, Vauxhall, Ford and Nissan, but he did not mention Britishvolt in my constituency once.
Britishvolt, a promising start-up company that is seeking to build a gigafactory in Wansbeck, is on the brink of collapse because the Government have not come forward with a promised £100 million grant from the automotive transformation fund. In my constituency, 8,000 jobs have been promised, but the Government will not listen. Once again today, many examples have been given, but not one related to my constituency and there was nothing about Britishvolt. It is the one gigafactory in the country that has planning permission, but the Minister never mentioned it, and we have to ask why. Why are the Government not even sitting down with Britishvolt to agree a way forward? We talk about levelling up in a constituency like mine—there would be 8,000 jobs, of which 3,000 would be with Britishvolt developing electric batteries. That is the future. The Minister continually said that he wanted to talk about the industries of the future. How futuristic can we get? We are talking about electric battery production.
That has not been carried through because the ministerial team in the Department for Business, Energy and Industrial Strategy said, first, that it would not grant any finance. It then said that Britishvolt would be granted £100 million, but that that would be after certain milestones at the end of 2023, but the company requires financing now. Does the Minister understand what that actually means for people in my constituency? We have been left behind for generations and there is an opportunity for 8,000 jobs. There would be 3,000 at Britishvolt and 5,000—perhaps even more—in the supply chain. We have to conserve that.
When the Secretary of State for International Trade was asked about Britishvolt a couple of days ago, she said that there has to be “value for money”. We are talking about 8,000 jobs in a constituency that has had the highest unemployment rate in the country for decades. Is that not value for money? Do people in my constituency not deserve the same as other people around the country? It is not really fair, Minister. I urge him to have a look at Britishvolt situation with all urgency.
We have a lot going on with regard to the automotive industry. It has been reported that Jaguar Land Rover is interested in moving its manufacturing base to Slovakia. BMW has set up shop in China. Electric van start-up Arrival has relocated to the US from the UK. If that trend continues, we will have no automotive industry and thousands more people will be on the dole or facing redundancy.
Other things are happening elsewhere. Northvolt in Sweden has successfully entered the electric car market backed by its Government’s Swedish Energy Agency. That will create thousands of high-quality local industrial jobs. Even the German Government have pledged more than $500 million to Northvolt to construct its gigafactory in northern Sweden. While gigafactories open up across Europe from Germany to Sweden, we are sadly lagging behind, crippled by a zombie Government unwilling to support crucial new developments that would create jobs, boost productivity and grow the economy. When the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) was Prime Minister, I asked him where the money for Britishvolt was. He said at the Dispatch Box that it was in the post, but we have not yet received a ha’penny for that company in my constituency. I ask again: where is the money?
My constituents and the potential investors want assurances that the sound of workmen marching from the site in Cambois is not akin to a death knell for the promised decade of growth and prosperity for our long-held-back region, or the final nail in the coffin for levelling up. Sadly, given the promises about the site from a long line of politicians over the past few months and indeed the past couple of years, I will have to take any commitments with more than a pinch of salt. The company has seemingly been cast aside by this Government, but its request for an advance grant of £30 million to guarantee up to 8,000 jobs is entirely realistic and reasonable. It is value for money, Madam Deputy Speaker—you’d better believe it.
Holly Mumby-Croft (Scunthorpe) (Con)
It will come as no surprise that I want to concentrate on steel, not just because it is an important employer in my constituency, but because I recognise, like many hon. Members here today, that it is a truly crucial foundation industry. From the wire in our tyres to the rails under our trains, we rely on steel in every element of our life; from the skyscrapers around us to the knives and forks we eat our meals with, it has a huge impact on us all. That is why countries all around the world find ways to support and protect their steel industries, why a free market for steel does not actually exist, and why we must always do everything we can to ensure that our nation can make its own steel.
I am grateful for the opportunity to speak in this debate. I agree with parts of the Opposition’s motion. They are right that steelworks provide high-quality, highly paid, skilled jobs. I also agree that the steel industry is crucial to meeting net zero targets: steel is irreplaceable, and if we are to have any realistic chance of meeting our goals, we need to see it not as part of the problem but as a way to find solutions. However, that is probably as far as my agreement goes.
The motion does not recognise the work that the Government have done to support the steel industry. In the past three years alone, I have seen with my own eyes how Conservative Governments have been paying workers’ wages in Scunthorpe. They have twice taken the step of extending the steel safeguards. They have helped with energy costs: since 2013, Conservative Governments have provided more than £800 million in support to the steel industry with energy costs alone. I say that not as a Tory MP, but as somebody born in Scunthorpe who comes from a steel family and understands the importance of the industry to our area.
Anyone who has stood inside an industrial cathedral like our steelworks in Scunthorpe, who has felt the heat on their face and who has felt the ground move as the metal is tapped will feel as proud as I do of the contribution that the industry makes to our nation. Of course there are many challenges, from the frankly crackers emissions trading scheme, which risks incentivising companies’ excess production to protect future carbon allocations, to the price of energy, which under Governments of both parties has historically been higher in this country than in the EU. That is unfair, and it makes it difficult for our world-class steelmakers to hold their own.
On our task of decarbonising steel, I agree with many of the points that my right hon. Friend the Member for Wokingham (John Redwood) raised. I want to be clear that we must not fall into the trap of lowering our own emissions simply by shipping them abroad. Our usage of steel will remain, as it should and must, and we must not create an environment in which we damage our capacity or close down our steelworks and end up importing steel. Our climate targets are important, but we all live in one world. I am not interested in any version of net zero that enhances our credentials by offshoring the issues.
We need to take steelworks with us on this journey. I hope the Government will be very firm. As a nation we need to use steel, and we will continue to need to use it. Hammering our own industry and adding the emissions of shipping in order to improve our face-value environmental credentials would be unconscionable and completely pointless.
I welcome the opportunity to raise these challenges—I never like to miss an opportunity to talk about steel—and I know that the Government are not blind to them, because I discuss them regularly with the Government. Many people, locally and in the House, will know that British Steel is also having talks with the Government, and I am very pleased that the Government are engaged in those talks. We need to understand the best way forward, and I hope the Minister will agree with me that we need to find a solution and protect our steel industry.
Yasmin Qureshi (Bolton South East) (Lab)
It is a pleasure for me to speak about this issue today, as one of the three Members of Parliament representing Bolton, a town with a proud industrial history. For too long, Britain’s industrial strategy has been plagued by short-termism and vulnerability to political change. We need a real plan for businesses in Bolton and in Britain.
When I visited Booth Industries, which is based in my constituency and provides high-performance and high-integrity protection systems for various construction projects, two things became clear to me. First, it is imperative that we have a “make, buy and sell in Britain” policy when developing our industrial strategy: the benefits of that are clear. Booth Industries was granted an HS2 contract to manufacture tunnel doors, which has allowed it to diversify into other sectors. It wants to become involved with nuclear power plants in order to grow its business, but with EDF holding the contract, a significant amount of its supply chain uses French companies. Surely it makes sense to use British businesses for British nuclear power stations when fulfilling supply chain needs. That would not only develop our own supply chain resilience in Britain but support small and medium-sized enterprises, which make up 99% of British employers, and allow them to grow and invest. This is what levelling up in action means: it means helping British businesses to grow and to train staff, create jobs, improve skills training, and prevent the brain drain of people leaving the country so that they can “get on”.
We need projects such as HS2 and Northern Powerhouse Rail to be completed. Our train service in Bolton is abysmal. Avanti is meant to be “servicing” the north, but all it seems to service are the pockets of its shareholders, while my constituents, and people in Greater Manchester as a whole and in other parts of the north, are losing out. We need to invest in roads, rail, light rail, trams, subways and high-speed rail, so that we can have a positive impact on our economy and, of course, benefit all our constituents. Companies like Booth Industries will then have a hook for investment and growth while also improving our own public transport network. That is a genuine win-win.
Such companies also demonstrate that there is a place in Britain for well-paid, green, industrial jobs, as well as tackling climate crises. Labour’s green prosperity plan, involving investment in offshore wind and tidal, nuclear, hydrogen and solar energy, will support companies like Booth Industries a hundred times over. It is about time that Britain had a Government who would create an environment for businesses up and down our nation to flourish, contribute and invest; and it is only the Labour party that is providing the leadership Britain needs in that regard.
Jonathan Gullis (Stoke-on-Trent North) (Con)
I am proud to stand up for the ceramics industry, which is the beating heart of our great city of Stoke-on-Trent. It is a shame that the shadow Minister, the hon. Member for Sefton Central (Bill Esterson), did not use this opportunity to mention ceramics at any stage. This plays into the narrative that the Labour party has set—namely, that it has forgotten Stoke-on-Trent and the ceramics sector and will continue to forget them, as it did in the previous 70 years before Stoke-on-Trent got a Conservative-led Council and three Conservative Members of Parliament, instead of talking up this great city and the fact that this Government have given nearly £4 million through the Kidsgrove town deal to Chatterley Valley West, which will open up the UK’s first advanced ceramics campus, creating up to 1,700 brand new, high-skilled, high-wage jobs for our local area, adding to the 9,000 jobs created across the city of Stoke-on-Trent, of which 2,000 came from this Conservative Government backing Councillor Abi Brown and her ceramics valley enterprise zone.
I am surprised that the motion does not mention Labour’s plan, but I think that is because it is a plan with a lot of holes in it. Those are not my words; they are the words of the shadow climate change Minister, the hon. Member for Bristol East (Kerry McCarthy), who was quoted at the Labour party conference as saying such a thing. Even a Labour councillor was quoted by PoliticsHome as saying:
“I’ve got no idea how to explain it”.
These are their words, not mine. That is why I will use this opportunity today to talk up the fantastic ceramics sector and the fantastic work of this Government. This Government understand that UK ceramics employs over 17,5000 staff, that it is worth £600 million in exports and that 75% of the industry is small and medium-sized enterprises. Advanced ceramics are used in our aerospace, in medical equipment, in IT and phones and in glass and steel, as well as in the classic ceramics of your toilet, your brick, your pipe, your tile and of course your plate and your mug, all of which I hope will only ever be from the great city of Stoke-on-Trent.
What can the Government do further to help? The energy crisis is indeed having an impact, and while the energy price cap for businesses has been welcomed, it is still quite a complicated mechanism. However, one company has told me that it will save it over £4 million over the next six months, which is a huge amount for it to invest in its workers and its factory and to continue its investment in decarbonisation. The industry has spent £500 million and more to help to find a way to decarbonise. That is without a single Government grant. The challenge for the Minister is how to treat ceramics in the same way and as importantly as the steel industry, of which my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft) is one of the biggest champions I have ever come across in my entire time of observing politics from afar and here in this Chamber.
We also have to look at the technology. Electric kilns are a nice idea but the technology simply does not work for the UK ceramics sector. They do not work at the temperature needed, and even if only one kiln is installed into a factory, it will take up all the power required, so for factories needing four or five kilns, they simply would not work. National Grid is telling manufacturers such as Churchill China, Steelite and Burleigh that it could take up to two years to sort this out. This is a shocking thing, and while it is of course important to decarbonise, it has to be done using a common-sense approach that does not risk this important UK industry or the people who work in it.
We also have to look at the UK emissions trading scheme, as others have mentioned. The fact that the cost of carbon is more expensive than the EU scheme is simply wrong. Also, the UK Energy Emissions Trading Scheme Authority keeps moving the goalposts, demanding quicker decarbonisation than current technology can cope with, and it needs to be held accountable. It is important that we make that point. It is also important to understand that, while we are investing in hydrogen within the ceramics sector, Government grants to support that will be needed in order to see if that technology actually works.
Stoke-on-Trent is a hotbed of geothermal opportunity, but sadly geothermal is not mentioned enough by anyone in this House. I want it to be unleashed and unlocked in Stoke-on-Trent, fuelling the homes of the future to make sure that households and businesses can get cheaper energy and use our natural resources to turn the city’s history of miners and pits and pots into its energy future. It is so important that we grasp that opportunity. We must give ceramics as much recognition and support as we give to steel and make sure that we protect this vital industry.
Alex Davies-Jones (Pontypridd) (Lab)
It is an honour to speak in this debate today, and I would like to focus my remarks on the link between Britain’s industrial future and its industrial past. This link is critical to the work of the all-party parliamentary group on coalfield communities, which I proudly chair. As the proud daughter of a former coalminer, I strongly believe that any talk on Britain’s future industrial vision must include a strategy for the regeneration of our former coalfields. My constituency of Pontypridd and Taff Ely is a brilliant patchwork of former coalmining communities that are proud of the contribution their heritage has made to Britain’s past industrial success. As I said in my maiden speech, just as those coalmines brought previously unreachable levels of prosperity to my area in the last industrial revolution, a new era of green industry in Britain can unlock new heights of prosperity and growth. I strongly believe that south Wales, and Pontypridd and Taff Ely, can be at the forefront of this regeneration.
To secure Britain’s industrial future, we must kick-start a new green industrial revolution, which would bring three extraordinary benefits: regeneration and prosperity on a regional level; economic growth on a national scale; and facing up to the challenges of the climate crisis on a global scale. At the heart of that first point, regeneration, is that much-discussed idea of levelling up, which has been criticised for potentially meaning many things and, by this Government’s record, also meaning absolutely nothing.
We have now had years of successive Tory Governments promising regeneration and completely failing to deliver concrete plans, culminating in February’s astonishingly vacuous levelling-up White Paper. Colleagues will recall that, rather than outline serious policy proposals for regenerating left-behind regions, the White Paper was padded out with a history of renaissance Europe and an enormous list of the world’s largest cities since 7,000 BC.
With funding prospects such as the long-awaited shared prosperity fund for left-behind regions still in doubt, and with the Tory Government asleep at the wheel on how to use that funding, the Opposition have an opportunity to take hold of the levelling-up agenda. Crucial to that agenda is securing an industrial strategy for Britain that is fit for the 21st century because, let us be clear, the Government’s current poor industrial strategy has been a complete failure: 12 years of stagnant economic performance; 12 years of no growth in real wages; and 12 years of deepening inequality in living standards. It is devastating evidence of the UK Government’s fiscal incompetence that Britain currently has more geographical inequality than almost any other rich country, and that was before the cost of living crisis properly took hold.
There are few places where this is more apparent than the south Wales valleys, which are the most deprived economic regions in Wales. We might not have our fair share of wealth, and we might be economically deprived, but we are rich in community, in skills and in opportunities. It is a clear legacy of the failed industrial strategy that our regions, which once helped power our industrialisation, have been left behind. Whether it is our former mining towns such as Pontypridd or the communities across the UK that powered our steelmaking, shipbuilding and automotive industries, the story is the same.
To facilitate a national strategy, the UK Government should be working in lockstep with organisations that are already investing in small and medium-sized enterprises in former industrial communities. The Coalfields Regeneration Trust, to name but one example, is building industrial starter units for SMEs and reinvests the rental income from those units in skills and wellbeing programmes for former coalfield communities. This innovative approach can form part of a joined-up industrial strategy that provides enormous levelling-up potential through reinvestment.
We have seen encouraging glimpses of the economic potential of a flourishing industrial future for Wales, and the work of the fantastic Welsh Labour Government to cultivate that potential must be commended. In Nantgarw in my constituency, where Craig Yr Allt colliery was once the deepest coal pit in south Wales, I am proud that General Electric Aviation has established a facility that provides well over 1,000 jobs in high-tech advanced manufacturing in our local area.
Despite the work of the Welsh Government, with the limited resources they have available, we will continue to miss out without an overall industrial strategy from the UK Government that is genuinely committed to meaningful growth. It is clear that, after 12 years of Tory rule, the Government are not interested in regeneration, but through Labour’s industrial Strategy, which has regeneration at the heart of its vision, left-behind regions can tap into the prosperity that the next technological revolution brings, delivering higher living standards and higher wages. I will continue to do everything in my power to make this happen, and I will continue to bang the drum for our former coalfield communities to make sure they are no longer left behind but are leading from the front.
Paul Howell (Sedgefield) (Con)
I, like many Conservative Members, have spent time working in business and find it amazing that those who have not are so vocal in claiming that we do not understand. This Government spent billions supporting businesses through the pandemic and are a true friend of business. Just in my constituency, Hitachi is investing in battery technology in Sedgefield, and the many science and space industries in Sedgefield are exemplars in driving opportunities for our region through potential unicorns.
Business needs many things, but the Opposition have ignored the two big disruptions. The pandemic and, of course, Ukraine affect everything we have been trying to do in recent years. As in the previous debate, the Opposition are selective in forgetting that these big arguments need to be considered. UK resilience, however, is a key part of any strategy, and obviously this has been driven further by what has happened with the pandemic and the situation in Ukraine. There is a need for us to be more in control of our supply chains. Whether that is about owning them and building things here, or just taking key positions in them, it is important that we get this right. It is a fundamental part of where we need to go forward.
We have a 10-point plan for a green industrial revolution. We are the first major economy to legislate to achieve net zero. We are ramping up the supply of home-grown energy, and we have reacted to the Putin energy crisis by providing immediate support to make sure our businesses are in a good place. This Government believe that business and industry are central to our economic strength, and have strongly supported investment across the country. Just last month, BP submitted plans for a green Teesside; the hydrogen energy there, which is just next door to my constituency, will create many jobs and help decarbonise heavy transport in the region. This will be the UK’s first major hydrogen transport hub and by 2025 it will become one of the country’s largest green hydrogen facilities.
It is not only international businesses that have a part to play in our industrial strategy. I cannot overemphasise the importance of engaging with local businesses, particularly when pushing for investment in space and science technology. As I mentioned, I am lucky enough to have companies such as Kromek and Filtronic in my area, as such companies provide high-skilled jobs to hundreds of local residents. But we also have established businesses in the automotive sector, such as Gestamp Tallent, and in many other industries. They are all pushing their agendas, and I have seen Ministers at all of them trying to make sure that they understand what these businesses need and that this Government are supporting them.
As was mentioned by my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), we need to be sure to work to have a balanced view of our investment. When considering any investment support, we need to understand what is happening across the world and make sure that we are not disadvantaging our businesses by not investing in them when other Governments are investing in theirs. We need to make sure we are in balance in what we are doing. We need to balance all our fuel opportunities in a completely holistic consideration of our need for fuel and its worldwide impact on the carbon footprint.
Until recently, I served on the Select Committee on Business, Energy and Industrial Strategy, and I have to say that for a significant portion of that time the Labour attendance was appalling. If Labour believes we need an industrial strategy, the time and forum for that is the Select Committee, and not grandstanding here. If Labour Members think the Government need to approach their industrial strategy differently, they have an opportunity to get that message across and challenge the Government through the proper channels.
Sarah Champion (Rotherham) (Lab)
At its heart, Rotherham is an industrial town. Coal, steel and glassmaking have been at the core of our identity since the industrial revolution. Although coal may have gone, my constituency still houses a substantial glass manufacturing business, in Beatson Clark, and steel production, in Liberty Steel. As energy-intensive industries, both have been severely impacted by the current colossal increase in the cost of energy. In August, the average UK wholesale price of energy was a staggering £370 per megawatt-hour, as against a pre-crisis level of £50 per megawatt-hour.
Alongside that exponential rise, UK carbon prices have reached historic highs, costing the steel industry an estimated £125 million in compliance costs this year. That not only harms the competitiveness of the sector, but reduces the capital available to the industry to invest in decarbonisation. Capping energy prices for businesses for six months was broadly welcomed by the energy-intensive industries. However, that remains a short-term solution. Industries are understandably fearful of a cliff edge when the support ends. It must be recognised that both steel and glass manufacturing do not operate in a vacuum. The German Government have confirmed the introduction of a scheme running for the entirety of 2023 that caps power prices for industry at £110 per megawatt-hour, which is more than £100 cheaper than the UK price cap scheme. That offers German steel producers not merely cheaper energy costs than UK competitors, but the stability needed to plan for the long term. In contrast, we have heard only deafening silence from the Government on what comes next.
The rising cost of energy is, of course, unprecedented, but the problem of an uncompetitive UK energy market is not new. Even before the current crisis, the costs associated with UK glass manufacturing were 62% higher than those in Turkey. Similarly, UK steel has, for years, faced considerably higher energy costs than European competitors. This has been brought to the Government’s attention time and again, but their approach has been to listen, offer warm words and then do precisely nothing.
UK Steel recently published its five priorities for the new Government. To anyone who has followed debates on the steel industry for the past decade, these are surprisingly familiar. They call for competitive energy prices, a net zero strategy aimed at delivering a green, modern industry, action on dumping of cheap subsidised steel, a commitment to use UK steel in public infrastructure projects and the creation of a UK steel innovation fund—not so new or ground-breaking, but not done by this Government.
We cannot afford to waste another decade repeating the same practical, sensible demands to a Government who have shown neither the willingness nor the ability to deliver solutions. But that is consistent with the broader failure in the Government’s industrial policy. In my 10 years as Rotherham MP, I have called repeatedly, as have my colleagues, for the Government to work with the industry to develop a clear, forward-thinking industrial strategy. The inclusion of “industrial strategy” in the name of a Government Department is not what I had in mind.
The current crisis must be a wake-up call. UK industries cannot hope to compete internationally if they continue to be hamstrung by a Government whose so-called industrial strategy is based entirely on inertia. It is simply not good enough for Government Ministers to stand at the Dispatch Box and tell this House how important these industries are, to recognise their contributions to the UK economy, but then hang them out to dry with their actions—or lack of actions.
I have heard it all before. My constituents have heard it all before. I urge the Minister to reflect on his Government’s record of failure with the industrial sector and work with these industries to deliver the vital support that they need to weather the current storm, and also to provide a policy environment that allows them to play their crucial part in driving our economy in the years to come.
Chris Clarkson (Heywood and Middleton) (Con)
It is always a pleasure to follow the hon. Member for Rotherham (Sarah Champion). It is also a pleasure to take this opportunity to talk about the proud industrial heritage of Manchester and East Lancashire, not least of my own Heywood and Middleton constituency.
We still make things, important things. We might have started off as textile towns, but, across Greater Manchester, we are now leading the way in advanced materials and manufacturing—from graft to graphene, ours is a success story. That is why I am slightly confused about the tone of today’s debate. Unless Opposition Members have been asleep for the past few years—in all fairness, that would explain a great deal—they would have seen that this is a Government who have taken unprecedented steps to support British industry. We need only to look back a couple of years to the dark days of the pandemic when the now Prime Minister put £407 billion in to support British industry—jobs were safeguarded, firms that would have otherwise gone to the wall were supported and some sectors even grew during lockdown.
It is also wrong to say that the Government have done nothing to drive innovation. The UK is well on its way to becoming a net exporter of clean energy, with our work on hydrogen and offshore wind among some of the most advanced anywhere. That is to say nothing of the major investment being made in nuclear, with thousands of apprentices training to take advantage of high-skilled and well-paid jobs in the sector. With the advent of small modular reactors, another British success story, we could even see nuclear plants using waste heat to produce hydrogen from renewables. That is hydrogen that is both green and pink—or, if Members prefer, watermelon hydrogen.
A total of £211 million has been invested in the Faraday Battery Challenge, so that we can store this new green energy. Another £1.3 billion has been invested to accelerate the roll-out of charge points for electric vehicles, along with £582 million in grants for those buying zero or ultra-low emission vehicles. An increasing number of those vehicles are being made here in the UK, as manufacturers shift towards all-electric production across their lines.
Add to that, the National Shipbuilding Strategy, which was published in March 2022, along with £4 billion of investment to improve access to finance and to deliver vital skills and funding for crucial research to boost the development of greener vessels and infrastructure. That means more well-paid, high-skilled jobs and another industry secured.
To build those ships and much of the other infrastructure improvements that we are delivering, we need British steel, the best in the world. Thanks to the hard work and strong advocacy of my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), millions of pounds have now been allocated to bolster that industry; she does not just say things but does them. Using homemade steel is cheaper and better for the environment than foreign alternatives. I should say that my hon. Friend has developed such a reputation as a champion for the industry that she is known affectionately on these Benches as the Steel Lady. Contrast that with Labour’s shameful record in Government, where steel production almost halved on their watch; I was going to stick with calling it brass neck, because I have already used the steel pun, but I think the record speaks for itself.
While Labour Members talk about tolerating businesses and describe them as the enemy, we have been working proactively to rebuild the industries left broken and moribund by the last Labour Government. It is under the Conservative party that a factory in Sunderland is now producing more cars than Italy, that seven of the 10 largest offshore wind farms are located in the UK and that £1.7 billion is being invested in new large-scale nuclear, so that we can reach 24 GW of clean energy on the grid. It is the Labour party who took a lump hammer to our nuclear industry and only managed an anaemic 7% of renewables on the grid, where we have managed 40%.
I will take no lectures from Labour on having a plan for anything, because I still do not think they have a plan or a strategy—no idea, no alternative and nothing worth saying. Last week I accused them of sixth-form politics; I would like to make an apology to sixth-formers everywhere.
I need only look at my own constituency to see industrious people making innovative products that improve people’s lives and contribute to the economy, whether that is Roxtec in Heap Bridge, making HS2, hydrogen and dozens of other industries work by providing sealing infrastructure, Union Papertech in Norden ensuring that our morning cuppa is not just delicious, but environmentally friendly, SMS in Middleton contributing to the next-gen Tempest fighter project, or dozens of other companies doing other amazing things. I have been incredibly proud to represent them over the past few years. I am proud of British industry and the contribution that the people I represent make to the economy. I am a little bit embarrassed for the Opposition that they genuinely think they cannot do any better than this.
Ms Marie Rimmer (St Helens South and Whiston) (Lab)
Britain must have an industrial future. At the moment we see other G7 economies having a better recovery while our industries struggle and some of them unfortunately have to close. Once our industries are gone, they are gone, and the Government need to stop taking them for granted.
Our economy is too dependent on the London property market bubble. If we want to be a successful economic powerhouse, the Government must diversify our economy. Right now it feels as though all our eggs are in two baskets: services and property. Any future economic plan must have industry at the heart of it.
Britain should be at the forefront of manufacturing new technologies in batteries, electric cars, wind and other forms of energy. Our economy as it is set up is too vulnerable to shocks in particular sectors. Too much Government money is spent procuring ships, steel and trains from abroad. Why? We have the skills and experience to make them here at home.
Money that is spent on UK goods is reinvested here in our economy. Even if it costs slightly more, due to our higher standards and working conditions, taxpayer money spent here remains at home and helps to support jobs and our economy. British people will get more satisfaction travelling in trains, buses and ferries built here. Only last week, it was revealed that the new Mersey ferry is going to be predominantly built in the Netherlands. I ask the Government—why? Why would they not want to invest in jobs and manufacturing here at home?
Britain should be leading the world in shipbuilding and other sectors, but it is difficult to do that if the Government do not believe in our workers and our industries. It is a lot easier to set up a new service company than it is to bring back a steel plant or glass factory. Yet in order to be a major economy as we go further into the 21st century, we must maintain our industrial sector—and of course that requires good working relationships between management and workers.
Across the industrial sector, there needs to be much better collaboration between the public and private sectors to boost our economy. That is at the heart of the Labour plan to future-proof our economy. There are many important industries that need a bit of help and support in difficult times, and many have been mentioned in this debate. Steel, automotive, shipbuilding and glassmaking are hugely significant. Of course it is no surprise that I would plug glass, having worked in the industry for 39 years.
Glass will be the low-carbon global material of choice. Many modern buildings are made primarily of glass due to the fact that it is recyclable and does not have a huge impact on the environment. In St Helens, the Glass Futures project will provide research, development and innovation to the glass sector worldwide. The centre will find ways in which glass can be used in the future economy. Glass Futures will keep Britain at the top of the global glass industry. As the home of Pilkington’s glass, St Helens will be at the forefront of new, innovative techniques. The glass industry is one that we can all be proud of, and it will only go from strength to strength as new technologies are developed.
The best way for Britain to boost our industry is to make sure we are leading the way on new technologies and providing high-quality, sustainable jobs. We have heard successive Prime Ministers talk about the UK industrial strategy, but far too often, the answers they reach are short-term solutions to long-term problems. We must look forward to the future of industry and to a fairer and greener future. I am afraid that after 12 years, the Government seem to be out of ideas, but Labour has a plan to get our industrial sector back on track and, more than that, to keep it on track.
There have been three BEIS Secretaries this year alone and 11 since 2010. The industrial sector wants to work with a Government who will listen to it and provide stability. The Government need to listen to our plan, or get back—yet again—to the drawing board.
Iain Stewart (Milton Keynes South) (Con)
It is a pleasure to speak in this important debate. I hope to make a constructive contribution by focusing on an area that I do not think we have touched on much: the appropriate balance between national industrial strategies and more local industrial strategies, both of which are important. I am in no way trying to undermine the importance of sectoral national strategies, which are important for finance, regulation, procurement and a range of other things, but more local or regional strategies are also important. To illustrate that, I will draw briefly on two areas in which I have experience.
First, in my time as a Minister in the Scotland Office, I had responsibility for the city and regional growth deal programme, which, of course, has been supplemented by other policy initiatives such as the levelling-up agenda, freeports, and the innovation accelerators that were part of the levelling-up White Paper. The meaning of “local” differs in different parts of the country—it could mean a city region or an individual authority—but my experience is that empowering a local area to take ownership of what it wants to see locally, working with the private sector and academic R&D in what Sir Jim McDonald of Strathclyde University called the “triple helix”, brings investment opportunities and local growth.
The city and regional growth deal programme is well advanced; all parts of Scotland now have one at a certain stage. Some of the older ones are entering the second half of their duration, so it is appropriate to think about what comes next and how we can best link together those different initiatives within the national framework, while looking at how local areas can drive forward their priorities, linking into the transport and other infrastructure that is required, the skills base and other important factors. Greater thinking needs to be done about city deals 2.0. The innovation accelerators, which are being piloted in Glasgow, Manchester and the west midlands, will be an important look at what might be achieved.
Secondly, I will touch briefly on my work on the Oxford-Milton Keynes-Cambridge growth arc, because it illustrates the limitations we have in joining up policies across different Government Departments and across different areas. That arc does not sit neatly into any geographic boundary; it crosses three of the traditional economic regions, and I have lost count of the number of local authorities that are part of it. There has to be some strategy for the arc to work without looking at projects within it—be it East West Rail or any other scheme—as entities in themselves. The arc will fail to reach its potential if we look at it as just a housing target, or as putting in a new railway, road or other bit of infrastructure. We must maximise the opportunities for each cluster, whether that is life sciences in Cambridge or engineering, automotive or aviation in my area. There are many potential growth areas and we need the appropriate balance.
The work is not complete on that. A representative of AstraZeneca attended a recent event that the hon. Member for Cambridge (Daniel Zeichner) and I held. They said that their growth plans are inhibited by the lack of better connectivity, housing and skills. We must look at all those issues in the round, link them to the national strategies, but give appropriate weight to place-based ventures.
I would love to expand on those points, but the clock is ticking. National strategies are important, but they must be counterbalanced by the place-based approach.
Rachel Hopkins (Luton South) (Lab)
This Conservative Government are incapable of fixing the structural problems at the heart of our economy. Just look at the past 12 years, when we had six different growth plans. In the past six years, we have had five Prime Ministers and, just this year, we have had four Chancellors. Where is the stability? Where is the consistent plan? Instead, there is a track record of wasted opportunities and mistakes. There has been chaos under the Conservatives, who crashed the economy.
Our growth rate since 2010 has been only 1.4%—lower than the OECD average and behind the USA, Canada and Germany. The country faces the lowest growth in the OECD over the next two years, behind countries including Italy and Greece. The Tories have dismantled our economy by entrenching low growth, low productivity and declining living standards. Working people are expected to pay the price of Tory failure.
For too long, industrial policy in the UK has been plagued by short-termism and its vulnerability to political changes. The British public need a fresh start and part of that is reaching a collaborative settlement with the European Union. Many of us voted to leave the European Union to see a strong, democratic sovereign state working in the interests of the British public: a state that works with business to grow the economy, create good jobs and deliver public infrastructure and projects. Essential to that is an ambitious, Government-driven industrial strategy. We need to rebuild British industry and deliver growth that makes all parts of our country better off.
A recent Rebuild Britain article stated that our country needs
“greater self-reliance with jobs, skills, industries and technologies rooted in local areas serving the needs of localities and the wider nation”,
as my hon. Friend the Member for St Helens South and Whiston (Ms Rimmer) outlined so well.
A modern industrial strategy requires building a partnership between the public and private sectors to meet the immense challenges we face. Let us take the automotive industry, which employs 780,000 people in our country and accounts for 10% of total UK exports. Car and van manufacturing can be found in every region of the UK, from the north-east to the east of England, and particularly in my constituency of Luton South, which is incredibly proud of its historical ties to the industry through the local Vauxhall plant.
Despite the Minister’s rhetoric, with the fast approaching 2030 deadline prohibiting the sale of new petrol and diesel cars, unless Britain secures domestic gigafactories for manufacturing batteries, manufacturers will move elsewhere to build their future electric models. Building gigafactories would contribute to meeting net zero, distributing growth across the country and helping to expand automotive exports. It is a win-win-win. However, I heard little about gigafactories from the Minister. Government inaction already means that the UK is far behind other European countries.
The UK has one gigafactory in operation, whereas Germany has five and a further four in construction, not to mention France and Italy, which are set to have twice as many battery manufacturing jobs as us by 2030. Manufacturers such as Vauxhall in Luton need certainty. They need a Government prepared to shape a competitive environment. A consistent policy framework, which businesses can trust, will encourage increased investment over the long term.
As part of our green prosperity plan’s national wealth fund, a Labour Government would part-finance the creation of three new, additional gigafactories by 2025, and we have a target of eight by 2030. Our plan delivers the certainty needed for automotive manufacturers to upscale their operations, in the knowledge that the Government have made a long-term commitment to the industry.
For the automotive sector and many others, we must safeguard the UK’s domestic steel production. While Governments around the world are committing to their domestic industries with long-term strategic investment in green steel production, the Conservatives have failed to invest in the transition, instead attempting to weaken safeguards that protected our steelmakers from being undercut by cheap steel imports and splashing tens of millions on imported steel to build British schools and hospitals.
Rachel Hopkins
No; I am sorry.
Leaving the European Union enables us to increase strategic investment in our key domestic industries; it should not mean stripping back regulations and leaving them exposed to the global market. Labour understands that, and in government we will invest up to £3 billion over the coming decade to green the steel industry. Labour will end the short-termism through our green prosperity plan and by introducing the industrial strategy council, placed on a statutory footing. Labour will work in partnership with business to tackle some of society’s biggest challenges. We are ready to rebuild the country fit for a fairer, greener future. It is time for a fresh start.
Angela Richardson (Guildford) (Con)
I am grateful for the opportunity to speak in this debate on the UK’s industrial future. Guildford is a constituency rooted with industrial heritage. From the wool trade several hundred years ago to one of the first purpose-built car factories in the country at the Rodboro Buildings, built by Dennis in 1901 to make touring cars, buses and commercial vehicles, my constituency has contributed more than its fair share to the UK’s economic growth. That spirit of industry is not diminished and has evolved to focus on developing our economy for the future. High-tech gaming, space exploration and 5G development are thriving in Guildford, and I am proud to represent such a forward-thinking corner of the world.
Guildford is leading the way in research on space exploration, and I welcome the launch of the Space South Central partnership earlier this year, which brings together more than 120 academic institutions, private companies and public sector organisations in Surrey and Hampshire to support those established within the industry as well as start-up companies. Last year, I was proud to visit Surrey Satellite Technology Ltd with my hon. Friend the Member for Buckingham (Greg Smith), to see for ourselves the facilities and the expertise that is being put into this vital industry, which, across the local enterprise partnership region, supports 3,245 jobs in 180 organisations.
Surrey Satellite Technology has contributed to many projects over the years, and I am pleased to see that its important work continues. It is currently working on a small satellite to measure the variables of climate change, which is vital if we are to keep to our global commitments and our net zero obligations. It is also building a thermal imaging satellite, which will pave the way for mid-wave infra-red spacecraft with the ability to measure the heat signature of any building multiple times a day, providing real-time insights on emissions, energy use and insulation.
When I asked the Prime Minister, in his previous role as Chancellor, last year about our businesses in Guildford, he said that innovative companies are the strength of the UK economy, and I know he still holds that ambition for sectors such as our space sector to grow and thrive in the future. This industry has the potential to really take off, and I know that this Government and their UK space strategy will continue to support the space industry in Guildford in the years ahead.
Guildford has also been at the forefront of the gaming industry in this country, with over 70 gaming studios supporting more than 1,800 jobs in the area. It has sometimes been called the Hollywood of video games. It all started with Bullfrog Productions, founded over 30 years ago and now part of Electronic Arts, which I am pleased to say has its UK headquarters in Guildford and continues to support local jobs and start-up companies. I mention gaming because it is important in pushing technology in other sectors, including the automotive and medical sectors. My first question in the House was to ask the then Minister at the Department for International Trade, my right hon. Friend the Member for Beverley and Holderness (Graham Stuart), how we can support inward investment into the gaming sector. I know that the Government’s commitment to supporting inward investment into the industries of tomorrow, through the local enterprise partnership, Enterprise M3, and other local stakeholders, is as strong now as it was then.
Last Friday, I was pleased to be able to witness innovation in action at the brand-new modular construction facility of QB Technology in Cranleigh. That fantastic company produces efficient and sustainable modular building systems that can be made off-site, under cover, using recycled steel frames, and can be used for commercial and residential construction. That offers exciting prospects for the future, such as quick and sustainable house building with minimal impact on the environment.
Guildford is proud to be home to many of the industries of the future. The Minister for Science, who opened the debate, and the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), who will wind up, will agree that continuing to support and invest in such industries is a key priority for the Government. Together with companies across Guildford and Cranleigh, we can continue to develop and innovate during the years ahead.
Sarah Olney (Richmond Park) (LD)
The UK economy is simply not working for British people today and is not fit to face the challenges of tomorrow. After years of slow growth, low investment and declining productivity, the Government’s only plan for the economy is to hike taxes and cut public services. We have now lost count of the number of Conservative Chancellors who have pledged to kick-start the economy, but none of their grand ideas lasts long enough to have any tangible or long-lasting benefit. The latest iteration, the growth plan, barely survived a month but still managed to crash the economy. Meanwhile, the Government have allowed existing industries to fall into decline while failing to support the development of future technologies and to seize the opportunities of a green transition.
We are failing to keep up with our international partners: the UK is the only country in the G7 to have an economy that is smaller now than before the pandemic. Our trading position is weaker and industries across the board are facing chronic labour and skills shortages, but the Conservative Government simply have no plan. The Liberal Democrats believe that we need an innovation-led economy with a new ambitious industrial strategy that really works for everyone—one that provides well-paid jobs and opportunities at work; ensures that business serves the common good; and sustains strong communities and thriving places. None of that can be achieved without a proper plan that tackles the issues at the heart of poor economic performance.
Chronic workforce and skills shortages are a major barrier to economic growth. Time and again, workforce constraints are at the top of the list of concerns when I speak to businesses, from local high street firms to large City corporations. Without a skilled and active workforce, an economic plan is not worth the paper it is written on. We need to empower our workforce with the skills and protections that they need to support economic growth. The Liberal Democrats would invest in skills and support lifelong opportunities for retraining to allow workers to adjust to the fast-moving economy of the 21st century. We would also implement a national skills strategy for key sectors to help match skills and people.
We cannot pretend that Brexit has played no part in exacerbating current workforce shortages; thousands of vacancies across our healthcare, manufacturing and hospitality sectors could be filled by foreign nationals, but our current visa system is not fit for purpose. Potential workers face a frustratingly long and costly application process that turns many away. The Liberal Democrats propose to scrap the arbitrary salary thresholds in the current visa system to meet workforce demands in the short term. That would bring in vital labour to support British industry and sustain our economy. Yesterday, hundreds of businesses from the hospitality sector took to Parliament Square to demand action from the Government after warning that one third face closure in the coming year.
Any plan for our economy must focus on reducing barriers to trade, which is vital for economic growth. The Government have long promised to slash red tape and open UK businesses to international markets, but since Brexit, small and medium-sized enterprises that export to the EU have faced an onslaught of red tape and many have simply given up trying.
The Conservative’s flagship trade deal, the free trade agreement with Australia, will contribute just 0.08% to GDP, which is hardly a panacea to our trading woes. Yesterday, the former Environment Secretary, the right hon. Member for Camborne and Redruth (George Eustice), admitted that the deal is woefully inadequate. In his words,
“the best clause…is that final clause”,—[Official Report, 14 November 2022; Vol. 722, c. 425.]
because it allows the UK Government to terminate or renegotiate the deal in the first six months. The UK gave away far too much for far too little in return and caused irreparable damage to British farming—and for what? Saving face and meeting an arbitrary deadline of concluding negotiations before a G7 meeting is just another example of the Conservatives’ short-sighted and reckless approach to the economy.
The Government seem intent on making it increasingly difficult to trade with our largest trading partner of more than 450 million people across the EU. The Liberal Democrats would focus on rebuilding our trading relationship with our European neighbours to unlock the potential of British business.
Net zero could bring a wealth of economic benefits to the UK. We have a real opportunity to be a leader in green technology, but the Conservative Government are showing a complete lack of ambition. The Liberal Democrats would implement a bold green agenda to deliver on our climate commitments while supporting businesses to adapt and thrive. From new targets for zero carbon flight to new industrial strategies for hydrogen and power cabling, our plan proposes a major restructuring of the UK’s economic model. Meanwhile, the Government’s previous 10-point plan for a green industrial revolution has seemingly been kicked into the long grass, along with a whole host of manifesto commitments.
I urge the Minister to act on the concerns raised here today, and to implement a new industrial strategy that is aligned to our net zero goals. Only with a real plan for our economy can the UK turn its fortunes around and really unlock our potential for growth.
Paul Bristow (Peterborough) (Con)
It gives me great pleasure to speak in this debate on Britain’s industrial future. It gives me great pride once again to talk about my city of Peterborough, a city whose tradition of manufacturing, engineering and all sorts of other industries makes it crucial to Britain’s industrial future. I also want to pay tribute to the Minister, who is not in his place on the Front Bench at the moment—the Minister of State, Department for Business, Energy and Industrial Strategy, my hon. Friend the Member for Mid Norfolk (George Freeman). The Minister did, quite rightly, refer to how Britain is the ninth biggest manufacturing economy in the world, something that is all too often forgotten about in this country. We constantly hear messages that we do not manufacture and do not make anything any more as a country. Well, that is evidently not true if we are the ninth biggest manufacturing economy in the world.
I would like to return to a theme I have raised in this House before, because the truth is that in Britain we have too many jobs that are low-skilled, have too low productivity and are too low-paid, and we need to replace those jobs with highly productive jobs, highly skilled jobs and, of course, highly paid jobs. The truth is that this country for too long has been addicted to what I would call cheap migrant labour, and so many people in cities such as Peterborough—
Paul Bristow
It is absolutely true. If productivity and wages were somehow linked to migration, Britain would have been one of the richest countries in the world over the last 25 years. It simply does not work. We have been addicted to cheap migrant labour, and far too many people in cities such as Peterborough—far too many young people when they leave education—are referred to as a failure if they do not go to university or do not excel in academic subjects. What we need to be doing is valuing those children who excel in manufacturing and in practical and technical skills. That is exactly why we are building a university in Peterborough—a university that focuses on engineering, on manufacturing and on technical qualifications. That is really important, because that will attract other companies to come to our city, invest in the skills that we have in Peterborough, invest in those new people and ensure that we create those highly paid, highly productive jobs in the future.
There are just a couple of things I want to say about how, other than in Peterborough, we can transfer to that high-skill, high-productivity and high-wage economy. The first is that we have to invest seriously in R&D in this country. We have to continue to commit to that, and encourage private sector organisations to invest in research and development, backed by Government incentives on tax and regulation. That is absolutely crucial. No longer can we rely, as I said earlier, on cheap labour to drive economic growth, because it simply does not work.
The second thing we need to be doing is investing in skills, and I am really delighted to see our committing ourselves to lifelong learning. For places such as Peterborough, lifelong learning is absolutely crucial, and I hope we can do more and that we can invest in the talented people we have in cities such as Peterborough and across the country.
Thirdly—and I say this knowing that it will not always make me as popular with Members on the Conservative Benches as it will with those on the Opposition Benches—I went to Lancaster week to speak to my old university Conservative association, and what fun I had too. I was led to believe that all young people were socialists; well, that certainly was not the case at Lancaster. What they told me was that the one thing they felt could unlock their potential and their future is a relaxation on planning. We really have to focus on and invest in building the houses and the industrial units of the future. We need to create an environment where we can free up, not logjam, our planning system when it comes to industrial units, business and other areas, as well as homes for the future. No longer can we have a situation where new homes and new industrial developments are blocked for nimbyish reasons. That is not the way to long-term economic growth, and it certainly will not give a step up to young people in my constituency and elsewhere. Frankly, I do not think Labour Members get or understand this; they are still locked in a mentality of continuing with a low growth, cheap labour type economy and— [Interruption.] Their party believes in open borders and wants to import people into this country to do low productivity, low skill jobs. If we had continued with a system like that, Britain’s economy would have grown faster than that of any other country in the last 10 years. If we follow that advice, we will continue down the same route.
Several hon. Members rose—
Madam Deputy Speaker (Dame Eleanor Laing)
After the next speaker, the time limit will be reduced to four minutes. With five minutes, I call Kenny MacAskill.
Kenny MacAskill (East Lothian) (Alba)
Thank you, Madam Deputy Speaker. It is a pleasure to follow the hon. Member for Peterborough (Paul Bristow).
In this debate on the industrial future I wish to deal with renewables, in particular offshore wind. There has been some mention in the debate earlier—indeed, we have seen it in the press—that the statistic about Scotland having 25% of Europe’s potential offshore wind is incorrect. I am happy to concede that, although I am surprised it has been pilloried upon the Scottish Government because the statistic was also echoed by the UK Government, including by Ministers and even a Deputy Prime Minister, but I accept that technology changes.
It remains the case, however, that Scotland’s offshore wind potential is huge and significant. I am not prepared to accept the prognosis of Unionist front organisations or other bodies funded by rich men with an agenda. I maintain that the potential remains big because I remember when Scotland’s first bounty came about in oil and gas. As a child of the ’60s I recall being told that oil would all be gone by the ’80s, then it would be gone by the millennium, and when we got to the referendum in 2014 we were told that it was nearly gone and it was an impediment—how could a country like Scotland possibly survive as an independent nation if it had to put up with the difficulty of looking after its depleted oil and gas sector? Now, however, we find that there is a rush to grant licences at an excessive pace. So Scotland’s offshore wind potential is huge; even the former Prime Minister the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) described it as the Saudi Arabia of wind. If Scotland can do from wind what Saudi Arabia has done from oil, I will be very happy.
It has huge potential because Berwick Bank alone provides more electricity for domestic supply than Scotland has in households. That shows the potential, but to do it we have to ensure that the state has control, or at least a stake, that local businesses get the contracts, and that local workers get the jobs.
In each of those areas we are failing, and the Government have failed. In that context, I will look at one particular offshore wind farm. That wind farm is at Neart na Gaoithe, a Gaelic name and Hansard will get the spelling from me later. It is situated 15 km from the coast of Fife and 20 miles from my constituency, East Lothian, where the cabling will land. It is owned by EDF and ESB, one a state producer of power for France and the other the electricity board from the Republic of Ireland. The profits from this wind farm—54 turbines providing 370,000 households with electricity—are going not to Edinburgh or London, but to Paris and Dublin. That is ridiculous, and at minimum a stake should be taken by the Scottish or the UK Government.
What about the contracts? The contracts for the 54 turbines are going to Hull; they are certainly not going to Methil, where BiFab lines lie empty, or Arnish where lines also lie empty. I do not begrudge the work going to Hull, but 54 is more than the number of turbines committed to or produced in Scotland at all, which is unacceptable. Every yard in every estuary in Scotland should be producing these turbines because the requirement is there, yet we are getting numbers of contracts that we could count on our hands and feet and that is simply unacceptable. The other contracts are going abroad too, to Belgium, Spain, Norway.
What about the jobs? I listened to the hon. Member for Peterborough going on about jobs going abroad. At this very moment workers in the Neart na Gaoithe field who are operating on the Solstad ship the Normand Navigator, are getting redundancy notices because there has been an extension of the offshore workers immigration rules and as a consequence the employers are laying off UK seafarers—36 so far, and more perhaps in other fields—and replacing them with cheap south Asian labour. That is simply disgraceful. We are not giving the contracts to Scottish business, and the workforce, whether based in Scotland or elsewhere in the United Kingdom, are getting redundancy notices. Many of them took those jobs because there was an opportunity to work closer to home. In my constituency, we will be able to see the turbines turning, yet many in their homes will not be able to meet the bills despite the fact that the energy should be available cheaply and not priced at the rate of European gas.
We are not even getting the jobs. As I said, we have the ridiculous position that we will be legislating in this Chamber to address the iniquity and disgrace of P&O and yet a situation caused by the Home Office’s rule change is seeing UK seafarers laid off and dealt with as despicably as P&O dealt with other sailors. It is about time that we took the opportunity to get the best of renewables and to protect our own workforce.
Madam Deputy Speaker (Dame Eleanor Laing)
Good news: one colleague has withdrawn from speaking, so the time limit will stay for the moment at five minutes.
Andy McDonald (Middlesbrough) (Lab)
Thank you, Madam Deputy Speaker. In 2015, under the Tories, more than 150 years of steelmaking in my part of the world came to a shuddering halt with the closure of the SSI blast furnace in Redcar. The very concept of industrial strategy came to the fore in a unique and graphic manner. The received wisdom of Government Members meant that they had no truck with industrial strategy and they simply allowed markets to dictate and determine whether our industries, such as steel, survived.
We move on and look to the very lands on which the steelmaking industry sat for development now and in the years ahead. There is unanimity of purpose in securing the new industries of the future, focusing on renewable energy development, hydrogen, carbon capture, utilisation and storage, and offshore and onshore wind among many others. There has been much promise of creating 25,000 jobs. I regret to say that there is little evidence of that coming to fruition any time soon. However, the objective is the correct one. What is not correct is the way in which the Tees Valley Combined Authority under the auspices of the Mayor, Ben Houchen, has set about the business.
Vast sums of public money—some £375 million—have been expended on acquiring and remediating the land on the south bank of the Tees for development. No one objects to that ambition, but what happened was that a joint venture company styled under the title Teesworks was formed initially as a public-private partnership whereby the Tees Valley Combined Authority had a 50% share along with its private partner. The sad reality is that the private venture partner got involved only because of its acquisition of an option to purchase land—a ransom strip—which put it in the key position when the combined authority entered into the joint venture. There was no procurement or tendering process whatsoever. A marriage was made simply between the public and private sector in those ratios, but, as we approached the end of the available funding from central Government, a totally and utterly unacceptable decision was made whereby the 50:50 share was transferred to 90:10 in favour of the private sector joint venture partner. Those shares—public property—have been transferred for nothing. For nil. For zero. For zip.
There is a real sense on Teesside that these matters have been conducted in a clandestine manner and an atmosphere of secrecy, with a total absence of any proper, effective scrutiny and a distinct lack of accountability. There is also a sense of there being something unseemly about those benefiting directly from the contracts so massively.
All of that happened without a proper procurement process, and the Public Accounts Committee does not have the locus to investigate. The National Audit Office claims that it has no responsibility for those moneys and is content to leave it to external auditors. That means that Private Eye has been leading with its detailed and thorough examination. It comes to something when we have to rely on a satirical magazine to undertake forensic examination of how public money is spent, but we need only look at the Tees Valley Combined Authority’s website to see how its board minutes and agendas in respect of not only the South Tees Development Corporation but the freeport board are put beyond our gaze and deemed to be confidential. It is a common experience that freedom of information requests are met with resistance and obfuscation. We need to have a clearer look at these elements, but it is evident that any demand for better scrutiny and better governance is constantly met with cries of disloyalty and a lack of ambition. Nothing could be further from the truth. It is about progressing the agenda, looking after public money and pursuing development in the interests of the people, not simply enriching further the already extremely wealthy.
There will be a day of reckoning on these business transactions. We need to get to the bottom of how these things have been allowed to happen. There is a real challenge to central Government more broadly as to how they exercise control and scrutiny over the expending of such vast amounts of public money. I hope that day will come very, very soon.
Jessica Morden (Newport East) (Lab)
I am very pleased to be called in this debate to talk, like other hon. Members, about the steel industry, which is so important to, and at the heart of, the community I have the privilege to represent.
In Prime Minister’s questions last week, I had the opportunity to challenge the Prime Minister on the Government’s lack of support for the steel industry. I welcomed his recognition of the importance of the sector to the economy and our communities up and down the country. However, I worry that that was just another set of warm words from a Government who only ever seem to react to crises in the industry when things get desperate, but refuse to implement any kind of long-term plan for steel, a sector that should be the cornerstone of a forward-looking green industrial strategy. The ask was set out excellently by my hon. Friend the Member for Rotherham (Sarah Champion) earlier and has been well rehearsed in the many debates on steel we have had in this place.
We only have to look at the rate of turnover of BEIS Ministers to get a sense of just how unfocused the Government have been over the last 12 years. Since 2010, we have had 11 responsible Ministers, including six over the last three years alone. I am not sure, even today, exactly who is the steel Minister in BEIS, because there is no list of responsibilities on the website and no answers to the parliamentary questions we have tabled. Will the Minister please tell us in his closing remarks who the steel Minister is? That crude lack of continuity makes it incredibly hard for representatives from the industry—steel unions, UK Steel and parliamentarians—to engage constructively with the Government and, perhaps harder still, for the Government to develop a strategy to ensure a long-term future for an industry that is of such vital strategic importance to our sovereign capability and national security. [Interruption.] From the look of the note that has just been written, the Minister is asking who the steel Minister is.
If we as steel MPs are frustrated, that is nothing compared to how steelworkers feel. Speaking to union reps from Tata Llanwern and Liberty on Friday, there is a real concern for the future and a sense that opportunities could tragically be lost. There are huge challenges for our industry at the moment. At Tata Llanwern, the average age of the workforce has fallen from 53 to 32 in recent years. The young members of the workforce, having shone with the benefit of high-quality training, are performing everything they are asked to do, but, given the anxieties that hang over the whole sector, these young multiskilled workers are now worried about their mortgages and their futures. Some of those worries relate to immediate problems the industry is facing, including falling demand in the construction and automotive sectors. Llanwern produces world-class automotive steel for Jaguar Land Rover, which has slowed down its production. Looking to the longer term, there is also exasperation with the lack of vision shown by the Government and their failure to stump up the investment funding or work with the industry to help companies decarbonise. Steelworkers feel neglected at a time when their contribution has never been so vital to our economy. We know that the world cannot decarbonise without steel, whether it is for use in wind turbines, electric vehicles, energy-efficient buildings or other green infrastructure. The steel sector is committed to the transition to net zero, but it needs a policy framework that will support, not hinder, it. The Government must provide a solution to allow the industry to invest in decarbonisation.
Energy prices remain a huge issue, with steelmakers still paying well over the odds compared with our continental counterparts. That point was made well by my hon. Friend the Member for Rotherham, who outlined the help that the German Government are giving their industry. We are not being as generous. We also need longer-term reforms to bring down electricity prices beyond the difficult winter ahead, akin to those implemented in France and Germany.
Let us not forget that the previous Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), made reduced energy costs for the steel sector an important promise during the Brexit campaign. Six years on, we are still lagging behind. On that note, the Government should also follow the EU in closing the loophole for the sanctions regime against Moscow that still allows indirect imports of Russian steel from third countries and create a UK steel innovation fund using the £200 million refund from the research fund for coal and steel.
We need Ministers to set ambitious targets for the use of UK steel content in public procurement, as has been said. This is a really important industry, with more than 76,000 jobs in the UK. As a steelworker at Llanwern said to me this week, the UK steel industry is less well equipped to weather the global storm than overseas competitors. He also said:
“in an insecure and unstable world, how can we not produce steel?”
Mick Whitley (Birkenhead) (Lab)
As a former automotive worker representing a constituency with a rich industrial heritage, I have taken great interest in the wide range of contributions that have been made today. In the same week that the COP27 talks conclude in Egypt, it is absolutely right that so much emphasis has been placed on the importance of investing in a just transition towards a greener, fairer society.
I have spoken many times in the Chamber about the importance of investing in a green industrial revolution, as proposed in my party’s last election manifesto. As time is short, I want to speak principally about the important role that a robust industrial strategy has to play in securing the future of British shipbuilding—an industry that is not only essential in promoting our economic prosperity, but in guaranteeing our national security.
On a recent visit to Liverpool, the Leader of the Opposition, my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer), described Britain as possessing an
“extraordinary genius when it comes to manufacturing.”
He is absolutely right. Indeed, from his podium, he needed only to cast his gaze across the Mersey to see that genius on full display. The historic Cammell Laird shipyard in my Birkenhead constituency commands an industry-wide reputation for being at the forefront of technological innovation in the sector. From its slipways have sailed some of the most technically sophisticated vessels afloat, including the state-of-the-art RRS Sir David Attenborough.
The yard continues to make an enormous contribution to the local economy. In the past five years alone, it has spent £400 million in the wider supply chain, including £140 million in the local community, benefiting more than 300 local businesses. There is a reason why Cammell Laird was chosen as the site from which to launch the refreshed national shipbuilding strategy earlier this year.
In that strategy, the Defence Secretary promised to lead a “renaissance in British shipbuilding”. Eight months later, however, he finds his resolve being tested by the competition for the construction of the Royal Navy’s fleet solid support ships. When I last raised concerns that work on those vessels might be offshored, the Secretary of State had the temerity to accuse me of spouting “claptrap” and “playing to the crowd”, but in the past few weeks, it has been widely reported that he intends to do just that. Indeed, figures from across the shipbuilding industry are convinced that Ministers are poised to award the £1.6 billion contract to the Team Resolute consortium in just a few weeks’ time, despite the warning that a Team Resolute victory could lead to between 60% to 80% of the work on the FSS ships taking place abroad.
Things do not have to be that way. Since my election to the House, I have consistently argued that the contract must be awarded to Team UK—the only consortium in the bidding process promising to build and design the ship in its entirety in the UK. I have secured Westminster Hall and Adjournment debates on the issue and have written countless letters to the Ministry of Defence, most recently with the support of Metro Mayor Steve Rotheram and colleagues from across Merseyside. That is not only because of the obvious benefits that that would have for my constituency through the involvement of Cammell Laird in the Team UK bid, but because of the contract’s potential to herald a major leap forward for the shipbuilding industry nationwide. If it is successful, Team UK has pledged to invest £90 million in British shipyards and a further £54 million in apprenticeships and training, including at Cammell Laird’s marine engineering college. A victory for Team UK would directly or indirectly support 6,000 jobs across the country, as well as returning £650 million of the total spend to the public purse through direct and indirect taxation.
The choice facing this Government is simple. My party has committed to strengthening our nation’s security, economy and sovereignty by building in Britain by default. Will the Government now do the same?
Peter Grant (Glenrothes) (SNP)
I do not often start my speeches by directly addressing the constituents of another hon. Member, but may I say something to the constituents of the hon. Member for Peterborough (Paul Bristow), who is no longer in his place? If his constituents who have travelled to Peterborough from outside the United Kingdom are as appalled as I am that they have been denounced as cheap foreign labour by their own Member of Parliament, and if they no longer feel welcome in Peterborough, they can come to Fife or to Scotland. They will be made welcome. They will find thousands of businesses desperate to give them work: not “cheap foreign labour” work, but well-paid work that will keep the Scottish economy going.
The motion is about the Government’s failures on industrial strategy, which are nothing new for my constituents. A hundred years ago, Methil docks exported more than 3 million tonnes of coal per year. Vast amounts of money were made by the lairds and the earls; a lot of it found its way into the Treasury, but almost nothing was left behind for the benefit of the local community. All that remains of that vast fortune is the memorials, in almost every town in my constituency, to the men and boys who went underground and never came back.
Methil docks then became the RGC construction yard for oil rigs. Again, the people of Levenmouth did their part, and more, to fill the pockets of the Treasury and the shareholders; again, when the downturn came, they were abandoned by Westminster. As the hon. Member for East Lothian (Kenny MacAskill), who is no longer in his place, mentioned, the yard was then taken over by BiFab, which made jackets and platforms for offshore wind turbines. Once again, the people were let down by the British Government, who set up contracts for difference in a way that allowed south-east Asian companies to compete on cost with my constituents at BiFab. Other European partners, through European legislation, were able to protect their own supply chains, but this British Government made a deliberate choice not to do so. They sold BiFab down the river at Methil, Burntisland and elsewhere, whereas other European countries fully appreciated the need to protect their own supply chains.
Look at the ludicrous scheme for the Rothes pit just outside Thornton in my constituency. It was opened under a previous Tory Government by no less a person than Her late Majesty. We were promised that it would last 100 years and produce 5,000 tonnes of coal per day. A new town, Glenrothes, was even built to house all the miners who would be needed. The pit lasted five years; the total cost to the taxpayer, in today’s money, was half a billion pounds. The list goes on and on: grandiose schemes, grand words and wild promises to my constituents and others by successive Governments in this place, of all hues. None of them has stood the test of time.
I hope the House will understand why neither I nor my constituents can have any confidence that any UK Government can be trusted to ensure that Fife or Scotland is well placed to take full advantage of the current revolution in industry, particularly in energy technology. We already produce more energy in Scotland than we need, and we are very close to being able to meet our entire needs from clean, renewable, non-nuclear sources. That is the answer that the Minister did not want to hear to the question that he asked: the reason the SNP does not want Scotland to invest in nuclear power is that we dinnae need any. If the UK Government think England needs nuclear power, they are welcome to it. They can build the power stations in England and pay for them with England’s share of the funding, but they cannot expect Scotland to bail them out.
Scotland can be self-sufficient in energy despite the determined efforts of British Governments to put obstacles in our way: the disastrous cuts to renewables in 2015, the decision to make carbon-free renewable energy subject to the carbon tax, the continued refusal to support the groundbreaking Acorn carbon capture and storage project, a whole decade of obsessive and ideologically based opposition to cheap onshore wind power, and the obsession with foisting on Scotland an unwanted share of the colossal but as yet unquantified cost of equally unwanted and unnecessary nuclear power.
It has become clear to a great many people in Scotland that we have what it takes to have a successful industrial economy, but that cannot happen when we are governed by any party in this place that wants to keep us away from our friends and neighbours in the European Union. It cannot happen when we are governed by any party in this place that wants to shut us off from the labour markets of Europe with an overly restrictive immigration policy. It cannot happen for Scotland as long as we remain part of this failed and discredited Union.
Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)
We should build, make, buy and sell more products in Britain. I think the Government should redraft their procurement rules to favour British companies first and foremost, creating more jobs in Britain. Labour proudly says, “Buy local, buy British”. It is a shame that there are not more Conservative MPs present to hear that, so I will shout it more loudly to enable Members in the Tea Room to hear it: we want people to buy local and buy British, backing local jobs in Britain. That is at the heart of our strategy.
It is an absolute nonsense that since we left the European Union our passports are no longer made in Britain, but are made in France; it is an absolute nonsense that, probably within days, the fleet solid support ships—those vital new supply ships for our Royal Navy and Royal Fleet Auxiliary—will, instead of being built in a British shipyard, be built in a Spanish one; and it is an absolute nonsense that our farmers are being undercut by trade deals signed with countries on the opposite side of the planet for lower-standard food when we should be buying more British food. That is what Labour Members mean when we say, “Buy local, buy British” and “Make, buy and sell more here”.
As a proud west country MP, I talk about Plymouth with real passion, because we have so much potential. The Science Minister—the hon. Member for Mid Norfolk (George Freeman)—is no longer in the Chamber, but I hope that if he were, he would add to the long list of examples that he gave earlier the incredible resources and expertise in Plymouth in respect of marine autonomy, which is critical to the exploitation of marine industries in the future.
Industrial strategy must not be limited to land-based industries, and Plymouth is turning the tide and showing how important the ocean is to innovation. Last month I attended the opening by Princess Anne of our new National Centre for Coastal Autonomy at Plymouth Marine Laboratory. This is a cutting-edge collaboration between Plymouth University, Plymouth Marine Laboratory, Marine Research Plymouth and the Marine Biological Association—all of them world-class marine bodies—and it builds on our existing industrial and science base. What we are developing in Plymouth is truly world class: the UK’s first autonomous coastal observing and monitoring network. It builds on the success of Plymouth’s Smart Sound project, which delivered underwater wi-fi and 5G—they provide a better signal than can sometimes be had on land—to kick-start autonomous vehicle research and the first autonomous proving ground in the country.
Alongside manufacturers of civilian and military surface, underwater and deep-sea autonomous vehicles, we have a cluster of expertise, investment and gold-plated opportunity for the Government to support, and I think they would be foolish to miss out on it. There will be only one world-class autonomous centre on the planet, and Plymouth is at the forefront of what it could be. I ask the Minister to back us, because with more investment in our city, we could be that resource—not just for Britain or Europe, but for the entire planet, creating high-skill jobs here in Britain. Would the Minister consider creating a marine autonomy accelerator in Plymouth, helping to commercialise the spin-offs that we are gaining from our incredible industry? That would lead to more jobs, more taxation, and more of the commercial spin-offs and innovation that would benefit not only the civilian marine and maritime world, but military deployment as well.
As you know, Madam Deputy Speaker, I am quite excitable about this project, because I think it is a genuinely exciting project that all Members should have a look at. It is spread across the far south-west, building on the expertise and the network that we have not only in Plymouth but throughout Devon and, indeed, Cornwall. Thales, M Subs, Sonardyne and many other companies are investing in high-skill, decent jobs, creating an avenue for young people in the future to build not only on the work of Princess Yachts—creating world-class British yachts—but on Babcock’s work in our dockyard.
There is an incredible opportunity for Ministers to seize, but I implore this Minister to adopt a fair-share approach to the way in which the regions are funded. No industrial strategy will work if the lion’s share of investment goes to the south-east. Places such as the south-west often miss out on the levelling-up agenda. Cornwall is the poorest county in the country, but it often has a very small share of the voice when it comes to the levelling-up narrative. Our kids are worth £300 less per child in school funding. We will not be able to achieve our potential if we miss out on £9,000 per class, and I urge the Minister to look again at how we can deliver on that potential.
Plymouth is getting a freeport, and we have shovel-ready projects for building there, but our council and business groups invested heavily in the investment zone bid. Will the Minister confirm whether the investment zone project is now dead? We need to ensure that those shovel-ready projects are delivered—if not by an investment zone, by some other means.
Alex Cunningham (Stockton North) (Lab)
I draw the House’s attention to my interest as the chair of the all-party parliamentary groups on chemicals and on carbon capture, utilisation and storage. Nowhere needs to see our industrial future secured more than Teesside. Unemployment there remains way above the national average, and no wonder. As my hon. Friend the Member for Middlesbrough (Andy McDonald) said, the Tory Government turned their back on the Teesside steel industry at the former SSI site and 3,000 people lost their jobs. Despite Tory promises, Cleveland Bridge & Engineering, which built bridges across the world, including the Sydney harbour bridge, was allowed to go under after a history stretching back to 1877, with hundreds of highly skilled workers losing their jobs.
When the Sirius mine project, largely owned by local people, many of whom sank their life savings into it, ran into cash-flow problems, the Tees Mayor promised support, only to be slapped down by his own Government, who paved the way for a multinational company to take over. Then there is the fishing industry. That too has been decimated as fish and other sea life have died off. The real cause of that has yet to be determined, but today I welcome the fact that the Government have set up an independent group of experts on that.
It is not all doom and gloom. The Tees could be home to the first carbon capture, use and storage project to get under way, but we now need action from the Government on the business case and contracting arrangements to make that happen. Perhaps the Minister can confirm that it will go ahead and that a second wave of projects will also be forthcoming. Then there is the potential of the controversial freeport and Teesworks sites, which we are told will be home to thousands of green industry jobs. I only hope that the Tees Mayor will deliver this time. He has promised mouth-watering numbers of jobs over his five years as Mayor, but there has been no more than a trickle so far.
I do, however, worry about who will benefit from any development there. As we have already heard from my hon. Friend the Member for Middlesbrough, 90% of the shares in the Teesworks site were handed to two private companies, and I agree that it is time for a full inquiry into how that process worked and when they acquired those hugely valuable assets. As for the freeport, I desperately want it to succeed, but not just for the entrepreneurs—it must also succeed for the people of the Tees Valley. I am worried about the potential for the terms and conditions of people working there to be dumbed down. We want high-value jobs, but not where highly skilled people are exploited for other people’s profit.
I now turn to energy-intensive industries, which are so important to Teesside. Already we have seen CF Fertilisers stop manufacturing ammonia, choosing instead to import it, and I know that another company nearby could be facing closure with the loss of 600 chemical jobs if things do not change for the better. Chemicals are critical not only to the local economy; they also contribute to the UK economy as a whole. We rely on them day after day, from the water we drink, the food we eat and the medicine we use to the mobile phones in our pockets and the electric vehicles on the roads. It is estimated that around 95% of all manufactured goods rely on some form of industrial chemical process. According to the Chemical Industries Association, 4,535 chemical businesses provide over 500,000 direct and indirect jobs, including factories and laboratories operated by a highly trained and skilled workforce.
That sector is one of the UK’s biggest manufacturing industries, with £33 billion of annual exports contributing £31 billion a year to the UK economy, but it is also under the cosh. These numbers are hard-won, and we as a country must do everything possible to secure and grow them further. There is no modern successful economy in the world without a chemical industry, and no other industry is so fundamental to economic, social and environmental progress, but the ramifications of high energy prices are affecting businesses across the board. This is why I have raised the contribution of the chemicals industry, in the hope that the Government will be reminded what is at stake should they not put together an effective industrial strategy. Labour recognises that the job of Government is to offer a reliable and consistent policy framework that businesses can trust and invest alongside, over the longer term. That is what they really want.
Stephen Kinnock (Aberavon) (Lab)
Britain has suffered from 12 years of low-growth, low-wage, high-incompetence conservatism. A key feature of the Conservatives’ disastrous record on the economy is their catastrophic performance on productivity. Output per hour worked in the UK grew at 1.9% between 1997 and 2007 but at a mere 0.7% between 2009 and 2019. It is that lower productivity that has caused the economy as a whole to fall further behind the US, Germany and others over the past decade.
This collapse in our productivity is not an act of God but the result of fundamental political choices. Do we starve businesses of the policy framework and investment they need to get our economy growing while cutting public services to the bone? Or do we pursue smart investment in Britain’s infrastructure, education, skills, research and development, and new technologies such as green energy? The Conservatives have consistently made the former choice over the past 12 years, but what we need for the decade ahead is the latter investment-driven growth model and, more specifically, Labour’s new industrial strategy.
There is a direct link between Britain’s low growth and poor productivity and the decline of our manufacturing sector, which has collapsed from around 30% of GDP in the 1970s to just 9% today. Manufacturing provides good jobs in less prosperous areas—meaningful, well-paid jobs on which people can raise a family—as well as the industries we need to get us to net zero and, perhaps most crucially of all, the foundations of our national security and economic resilience.
It is deeply troubling that the Chinese state holds a 33% stake in Hinkley Point, a 10% stake in Heathrow airport and a 9% stake in Thames Water. The public are opposed to the road this Government are taking. They know we need a Britain that can stand more firmly on its own two feet, and they recognise the need for foundational industries to thrive if Britain is to prosper. Indeed, in one recent poll, 80% of those surveyed declared steel as a strategically important industry that we must maintain in the UK, but the Conservative Government have failed to invest in our manufacturing base.
This September, manufacturing output fell by 2.3% to record the worst performance in manufacturing over three months since the 1980s. That is why the Labour party’s green prosperity plan will marry the quest for sustainable growth and jobs on which people can raise a family with the need for resilience. We see net zero not as a hindrance but as an opportunity for growth and prosperity.
I can assure the House that nobody will have to drag my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer) kicking and screaming to COP. He will be leading, not leaving. He will be boldly setting out his Labour Government’s plan to double onshore wind, treble solar power and quadruple offshore wind by 2030 and, in so doing, create as many as 1 million green jobs—from technicians to plumbers and steelworkers.
This is the level of ambition we need for our country: a plan to make sure British industry leads the world again, making us a clean-power superpower. We will also champion sectors of the British economy that are the envy of the world, from the fintech hubs growing in places such as Leeds to the booming video game production in Dundee and chemicals industry in Middlesbrough.
Our green steel renewal fund will secure the future of the steel industry in my Aberavon constituency in south Wales. By greening our steel processing, Labour will ensure our steelmakers can compete in a world in which global steel demand is on the rise. Make no mistake—Britain needs its steel as a foundation of the modern manufacturing renaissance that Labour will deliver.
Labour will, of course, put resilience front and centre of our industrial strategy by launching publicly owned GB Energy to ensure that Britain becomes energy independent. Not only Labour MPs but businesspeople are backing this. Paul Lindley, a successful entrepreneur, recently wrote in The Times about Labour’s investment-based approach, and the CEO of Tesco said that, when it comes to who has a convincing plan for growth, Labour is the
“only team on the pitch”.
Businesspeople across the length and breadth of the country know that Labour will partner with the private sector to drive a new kind of growth that will rebalance the economy, decarbonise our industries and reignite Britain’s potential. Twelve years of the Conservatives have hammered our manufacturing sector and crashed our economy. We need change and we need it now.
Madam Deputy Speaker (Dame Eleanor Laing)
I call the shadow Minister, Chi Onwurah.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I thank Members across the House for their contributions. We may disagree on how to support our great industries, but we can all agree on the importance of UK industry and the importance of this place talking about it.
With our world-leading universities, our fantastic science base, our national heritage in manufacturing and engineering, our dedicated and flexible workforce and the growing global demand, our industrial future should be bright. However, as my hon. Friend the Member for Sefton Central (Bill Esterson) set out, many of our key industries, including steel, car manufacturing and shipbuilding, are facing existential threats.
In three hours of debate, we heard no credible plan for this Government to deliver on industrial jobs, investment and growth. Conservative Members are unable to explain, for example, why UK car production has halved under their watch since 2016—from 1.7 million to just 860,000 cars this year—or why working people in this country have not seen a real-terms increase in their pay since the Conservatives took office. I have to ask: why did Conservative Members really come into politics? Was it to make working people poorer? It seems that way. The Conservatives have been in power for 12 years now: 12 years of low growth, low productivity—[Interruption.] The hon. Member for Stoke-on-Trent North (Jonathan Gullis) says it is relative. We want high-paid jobs, with increases for people.
Jonathan Gullis
I will use my third opportunity in this debate to remind the hon. Lady that in Stoke-on-Trent we have created more than 9,000 jobs thanks to a Conservative-led city council, led by Councillor Abi Brown, with 2,000 jobs linked to the Ceramic Valley enterprise zone, up to 1,700 jobs thanks to the Kidsgrove town deal and 500 jobs at the Home Office. That is 10,000-plus jobs in our area. Sadly, 10,000 jobs in ceramics went overseas to China under Labour’s watch.
Chi Onwurah
Unfortunately, the hon. Gentleman has just illustrated yet again how Conservative Members cannot answer the challenge of well-paid jobs across our country and a pay rise for our working people.
We have had 12 years of low growth; low productivity; austerity a-go-go; broken promises and abandoned manifesto commitments; spiralling inflation; the NHS at breaking point; the Home Office broken, and that is according to the Home Secretary; higher taxes; and higher bills for working people. What a record. At the heart of their ideology, Tories do not believe Government can make a positive difference. They do not want to get stuck in; they just want to get out of the way. It is just one long season of “I’m a Tory MP, get me out of here” where British business is concerned.
However, as my hon. Friends the Members for Bolton South East (Yasmin Qureshi) and for Birkenhead (Mick Whitley) so ably laid out, the state working in partnership with the private sector can shape and create markets. That is what industry needs: a partner to help plan for the future, provide investment and certainty, skills and infrastructure, research and development, trade and market access. The reality is that our great industries will never get the partner they deserve under Conservative Governments. It is much easier to destroy than to construct. They can crash the economy, but they cannot build the economy of the future.
As my hon. Friend the Member for Pontypridd (Alex Davies-Jones) emphasised, net zero and growth are not in opposition. Partnership between the market and the state presents the opportunity to build world-leading industries that will last for decades and spread wealth across the country. Labour believes the UK has huge potential for new green industries, such as clean steel, as championed so passionately by my hon. Friends the Members for Middlesbrough (Andy McDonald), for Newport East (Jessica Morden) and for Aberavon (Stephen Kinnock).
With our world-leading research base and universities, skilled workforce and deep capital markets, the UK is also well placed to create new clusters of manufacturing from Bolton to Birmingham. Labour has committed to an additional £28 billion of green capital investment a year until 2030 through our green prosperity plan as part of our British wealth fund.
As my hon. Friend the Member for Luton South (Rachel Hopkins) said, this country has enormous untapped potential when it comes to electric vehicles. In my constituency, Newcastle University is a leader in research to overcome the challenges of current battery technology. Under Labour, as my hon. Friend the Member for Wansbeck (Ian Lavery) emphasised, we will have eight gigafactories to ensure that the next generation of electric cars is made here in Britain. Labour also recognises that hydrogen could modernise heavy goods vehicles and public transport. These are long-term projects, so we will ensure certainty for business with our industrial strategy council to end the farce of long-term plans that do not survive the political cycle.
Science is the foundation of future success, but not content with crashing our current economy, the Tories seem bent on destroying our future economy. They simply are not serious about science. As well as their catastrophic trickle-down experiment with the nation’s economy, they are now trialling Heisenberg’s “uncertainty principle” for science. For the past few months, it has been impossible to know both the role and the number of science Ministers at the same time. The hon. Member for Mid Norfolk (George Freeman), who is not in his place, resigned over the previous—times two—Prime Minister’s behaviour. Then he asked for his job back, but that Prime Minister preferred to keep the position vacant. Then the previous Prime Minister gave the brief to the hon. Member for Wealden (Ms Ghani), but barely had she got her feet under the table when the current Prime Minister gave it back to the hon. Member for Mid Norfolk. Two weeks later, though, we still have not seen any ministerial responsibilities published. The rumour is that the hon. Member for Mid Norfolk has the brief, but the hon. Member for Wealden has the furniture—you could not make it up.
British science is no joke. Labour sees a clear path from world-leading British science to the jobs on which people can raise a family. That is why Labour will aim for 3% GDP investment from public and private sources into research and development, almost double the 1.7% that we have been seeing under this Government, supporting the jobs of the future—in life sciences, artificial intelligence, clean energy, satellite applications, semi-conductors, quantum technologies and marine autonomous technologies, as championed by my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard).
Labour would maintain our membership of the world’s largest science funding programme, Horizon, and we will ensure that the wealth and opportunity that science brings are spread across our country more fairly, as my hon. Friend the Member for Stockton North (Alex Cunningham) called for so passionately.
Chi Onwurah
I cannot give way, as I must make some progress.
We will help to champion clusters of businesses and universities as engines of regional growth, providing them with the levers and resources to collaborate and innovate together, rather than slashing regional science funding as this Government are doing.
British cities lag behind our European counterparts across productivity metrics. Newcastle, famous for its industrial heritage, is less productive in GDP terms than Gdansk, Lille and Valencia. Unlike the previous Prime Minister, I know that that is not because British workers are the
“worst idlers in the world”.
It is because the Government are not supporting them to reach their potential. Labour will work in partnership with businesses, civil society and trade unions and finally put an end to 12 years of Tory low growth, low wages and low productivity.
Labour’s industrial strategy will deliver clean power by 2030. We will create an economy that cares for the future and that harnesses data for the public good. Labour will build a resilient economy so that we can not only protect jobs in our British automotive, steel and shipbuilding industries, but provide the investment and long-term strategy that we need to be competitive on the world stage. Labour will grab hold of the national prosperity of which Britain is capable and deliver a fairer and greener future.
Today’s debate has shown that the Tories are out of plans and out of ideas. So, here is an idea for them: call a general election and let us put our industrial strategy to the country.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)
I must pass on the apologies of the Secretary of State for not being able to attend the debate, due to a Cobra meeting.
I thank all hon. Members who have contributed to the debate. Listening to the contributions, I cannot help but feel that reports of the death of British industry have been greatly exaggerated—that is probably not what the speakers meant, but that is definitely how it sounded.
From the aftermath of the global financial crisis to the coronavirus pandemic and, more recently, damaging disruption to worldwide supply chains, there is no doubt that global economic turmoil in the past 12 years has presented significant challenges for manufacturing in the UK. Nevertheless, to the shadow Minister’s point on slow growth, it is good to note that the UK has grown at about the same pace as the United States since 2010, and faster than Germany since 2016. It is important to have the facts. In the same period, we have come to understand the scale of the climate change challenge and the transformation that will be required in every element of our economy.
I will first touch on some of the contributions from both sides of the House. It is fair to say that there were some valuable contributions on both sides, although I probably have more in common with the comments from the Conservative side of the House. My right hon. Friend the Member for Wokingham (John Redwood) talked about making sure that we have a fair and level playing field in competition with overseas markets. Our “Steel Lady”, my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), rightly said that steel’s future was part of the solution for net zero, rather than part of the problem. My hon. Friend the Member for Stoke-on-Trent North (Jonathan Gullis) talked about the 9,000 high-skilled, well-paid jobs created by this Conservative Government.
My hon. Friend the Member for Sedgefield (Paul Howell) talked about the green hydrogen opportunities on Teesside. My hon. Friend the Member for Heywood and Middleton (Chris Clarkson) talked about the £407 billion committed by this Government to saving jobs and businesses during the pandemic. My hon. Friend the Member for Milton Keynes South (Iain Stewart) talked about place-based solutions to growth, which I entirely agree with.
My hon. Friend the Member for Guildford (Angela Richardson) talked about the opportunities in the space and satellite sector. My hon. Friend the Member for Peterborough (Paul Bristow) talked about investing in British talent, in students and workers, which I also agree with.
Alex Cunningham
This is my second opportunity to welcome the Minister to his position, this time at the Dispatch Box. He heard me talk about carbon capture and storage. George Osborne wheeched away £1 billion overnight from the project several years ago. Can the Minister guarantee that the same is not going to happen to the carbon capture industry this time?
Kevin Hollinrake
The hon. Gentleman made some good points about the opportunities on Teesside. Carbon capture and storage and Net Zero Teesside represent a huge opportunity and something that is on the Government agenda. We are also looking into the life sciences sector in Teesside and the first large-scale lithium refinery in the country, with 1,000 jobs in construction—all these things are happening on Teesside. I recognise his point on the steel sector, but all this carbon capture and storage may well form part of the future for Teesside.
The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) made some interesting points about buying British. I think everyone in this House would agree on the need to buy British, but does he accept that, that as the trade and co-operation agreement and others open up EU markets to UK companies, we cannot on that basis expect to close our markets to EU countries, or to countries from around the world? We believe in international trade—[Interruption.] Well, I also believe in buying British. I share his enthusiasm for the Government’s £206 million investment in a UK Shipping Office for Reducing Emissions—the biggest Government investment ever in that sector.
Manufacturing has been at the heart of our economy for centuries—the shipbuilding, automotive and steel industries perhaps more than any others. In 2021, manufacturing contributed more than £205 billion gross value added to the UK economy, which is the fourth highest figure in Europe. Manufacturing, which is responsible for almost half of UK exports, has a vital role to play in driving innovation, job creation and productivity growth beyond the bounds of the M25. The hon. Member for Kilmarnock and Loudoun (Alan Brown) will be pleased to note that 95% of manufacturing jobs are outside London.
Alan Brown
Does the Minister accept that although we cannot necessarily stipulate to buy British, procurement can be managed by assessing community benefit and local content as part of quality assessments, so that it is not a case of price takes all? That is not happening with the Government’s bus procurement strategy, and it did not happen long enough in the CfD auctions, either. Is that not something that the Government need to address?
Kevin Hollinrake
The hon. Gentleman makes a fair point. Certainly, the Cabinet Office is looking at procurement strategy now, and nudges could be made. My point is that we cannot expect other markets to open their doors to our businesses if we close our doors to theirs.
From Sunderland to south Wales, industries are at the heart not just of our economy, but of our communities. Those industries are integral to our economic policy, and the Government are ensuring not just that they are alive and kicking, but that they prosper in the 21st century. Together, Government and business are laying the foundations for an economy that is fit for the future. By delivering the new infrastructure, industries, skills and jobs that we will need to meet the demands of the day, we can deliver a future for all that is more sustainable, secure and prosperous. Across the country, we are already seeing stories of success.
Let me begin with shipbuilding. The UK has always been and always will be a seafaring nation. Today, the shipbuilding industry supports 46,000 jobs in places such as Portsmouth and Rosyth, and adds £2.4 billion to the British economy. I am glad that the hon. Member for Kilmarnock and Loudoun welcomes today’s £4.2 billion order for five Type 26 frigates, which will be built in Glasgow.
Earlier this year, we refreshed our national shipbuilding strategy, unlocking more than £4 billion in investment for maritime firms from the Solent to the firth of Forth. We are improving access to finance by providing credit for UK ship buyers through a home shipbuilding credit guarantee scheme, and we are working closely, through the shipbuilding enterprise for growth, to raise the productivity and competitiveness of UK shipyards.
This is not just a story of success at sea; we are leading the way on land, too. We are the sixth largest automotive producer in Europe, and the sector is one of the engines driving forward our plans for green growth in every corner of the country. Last year, Nissan announced £1 billion in investment to create a world-first electric vehicle hub in Sunderland, safeguarding 6,200 existing jobs and creating more than 1,000 new ones. We know that there is some way to go, but this Government are committed to putting the pedal to the metal and doing all we can to accelerate our efforts.
Many Members quite rightly talked about steel. The Government recognise the challenging international economic environment in which the steel industry has to operate, including in relation to overcapacity. Above all else, we understand the vital role that steel occupies as a cornerstone of the UK economy, underpinning domestic industries and local communities. Over the past nine years, the Government have committed £800 million towards electricity costs through the energy intensive industries compensation scheme, on top of the energy bill relief scheme. Of course, we continue to consider what can be done to ensure that the steel industry is competitive, in fair terms, with other nations.
On critical and advanced materials, we are investing in the materials of the future. That is why we published in July our first ever critical minerals strategy, which sets out our plan to secure our supply chains. We are boosting our domestic capabilities in the production and processing of critical minerals, building a circular economy where they can be recovered, reused and recycled.
The story really could go on, but I think I have made my point. This country has a rich industrial history that goes back centuries. Our world now looks very different from the 18th century, but one thing remains the same: that particularly British spirit of innovation and enterprise. This Government can and will play their part so that no community or corner of this country is left behind.
Question put and agreed to.
Resolved,
That this House condemns the Government for its lack of policy on British industry including the steel, automotive and shipbuilding sectors; regrets that after 12 years of Conservative Government, the UK has the lowest levels of business investment in the G7; recognises the large number of high-quality jobs created by British industry, as well as its importance to achieving the UK’s net zero targets; calls on the Government to recognise the unique challenges and opportunities in each of these sectors; and therefore further calls on the Secretary of State for Business, Energy and Industrial Strategy to urgently bring forward plans to ensure these sectors are supported and to avert job losses that will have a devastating impact on communities and the wider economy.