Steel Industry

Baroness Bloomfield of Hinton Waldrist Excerpts

2nd reading
Saturday 12th April 2025 Lords Chamber

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I agree with the premise that the UK needs a flourishing domestic virgin steel industry to enable our industrial regeneration goals to be met, but I also express my deep personal regret that virgin steel is no longer made in Wales. My father started his career in Cardiff Steelworks at a time when Welsh steel, particularly that from Llanwern, was known to be the best in the world.

I also echo the deep concern aired throughout this House about the way this has been handled and the potential enormous cost that may fall on the taxpayer. I hope that the Government will agree to a sunset clause, at least to enable them to take stock at some point in the future. For now, my thoughts go out to the steel-workers and their families during an undoubtedly stressful and anxious period. Now may not be the time for political posturing or, indeed, engaging in a baseless blame game, but the facts speak clearly for themselves.

There are a number of issues that have directly caused the precarious situation we now face. For the last few years, it has become increasingly apparent that Chinese companies have developed an insatiable agenda to close down all their competition in the steel market. The hostile actions of the parent company, coupled with some reckless decisions taken by this Government, have engineered this predicament. The Government’s failure to tackle crippling energy prices, instead deciding to hike national insurance, have caused further, and, I might add, unnecessary pressures on our already struggling industry.

If noble Lords require any further evidence of this Government’s short-sightedness, they just need to remember that it was the current Energy Secretary, Ed Miliband, who decided last September to block the planning application from West Cumbria Mining Ltd to mine the coking coal necessary to make virgin steel. Now it must be imported, at greater financial and environmental cost. Bluntly, this made no sense and caused some of our plants to become even less competitive. The Labour Government’s poor decision-making has helped engineer the steel crisis. This begs the pertinent question: the Government must have seen the writing on the wall, so why did it take them so long to act?

When faced with a crisis, it is imperative that we act swiftly and decisively, just as the last Conservative Government did with Port Talbot steelworks. In 2023, the then Government were told by Tata Steel that the plant needed to undergo operational changes or face closure, meaning 10,000 jobs would be lost. The company was facing a £1.5 million loss every single day—a huge financial shortfall that no company, and indeed no Government, could sustain. Importantly, it was known that the two blast furnaces there were nearing the end of their useful lives. The Conservative Government acted quickly, leaving no stone unturned in trying to save as many jobs as possible. The agreed plan involved a £500 million government grant support package to build an electric arc furnace, plus millions more to help retrain those who would lose their jobs.

The electric arc furnace currently being built on the site will make us less dependent on imports, because it will recycle the UK’s huge tonnage of domestic scrap steel. Of course, it is my hope that, one day, Port Talbot will have a dedicated power supply provided by an on-site advanced modular nuclear reactor, such as those that data centres are helping to finance in order to secure their own energy demands. Nationalisation should be a last resort; it is always the taxpayer who foots the bill. I am confident that everyone in this House will agree with me that steel is of strategic national importance and that we cannot allow the Scunthorpe plant to fail.

Steel: Port Talbot

Baroness Bloomfield of Hinton Waldrist Excerpts

Monday 15th April 2024 Lords Chamber

[Lord Johnson of Lainston (Con)]

I am grateful for that point. All of us in government are very sensitive to the people whose lives will be affected, which is why we are putting so much money into this process—£100 million in the transition board. I take this opportunity to thank Tata for its commitment to invest £1.25 billion in regenerating the area and renewing the British steel industry. I urge the unions to maintain their very strong record of good relationships, to not go on strike and to work with Tata, so that we can deliver what will be an incredible benefit for the area and the country.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I agree with all previous speakers that it would be an utter tragedy for steel-making to disappear from Port Talbot. However, does my noble friend agree that the only way of preserving a great British steel industry, and a green steel industry at that, is for the workers to work closely with Tata Steel, and for us to further green it using the offshore floating wind projects and with the potential of advanced modular reactors on site in Port Talbot?

[Lord Johnson of Lainston (Con)]

I thank my noble friend for that point, and she is absolutely right. If we look back six months or a year, there was very little future for steel-making in this country, and now we have one; we have a truly advanced manufacturing plan for this entire industry. This is something we should celebrate. It is a true industrial policy backed by government money, in partnership with the private sector, and supported by the extraordinary and brilliant talent of the people at Port Talbot.