Steel Sector
Debate between Lord Brookman and Baroness Neville-Rolfe
Baroness Neville-Rolfe
I hear what my noble friend says and completely agree that rates is a vital area. We have three ministerial working groups, set up in October. They are very aware of the importance of rates. My noble friend Lord O’Neill is leading the work stream on productivity and competitiveness. I will ensure that I pass on the comments made on rates.
Lord Brookman (Lab)
My Lords, I wanted to hear what the Minister had to say because I was general secretary of one of the unions involved in the steel industry. As the Minister said, it is devastating news, but it is not unusual news for the steel industry. I am reminded of something I said a few weeks or months ago, about when there were 270,000 employees in one company in the steel industry in the United Kingdom, called the British Steel Corporation. Now we are where we are. The figures are abysmal and most worrying. I worried even further when someone said to me, “Keith”—that is my first name—“You must remember that we live in a post-industrial society”. If we are heading down that track—we are rapidly going down that track as far as the steel industry is concerned—frankly, what the Minister and the Government are saying is not good enough.
I am concerned that I do not hear too much from the Minister about what the trade unions are actually saying at the moment. Are they accepting the closures? Are they accepting the fact that there will be fewer than 30,000 people in total manufacturing steel in the United Kingdom? Are they not that concerned—the Minister made the point that she was—that the imports from China and elsewhere are causing havoc in this country? I do not think the news from the Government is good enough, and I hope we get some more positive action from them.
Baroness Neville-Rolfe
My Lords, I would like to pay tribute to the unions in these very serious steel difficulties. They really have been amazing and shown that they can be extremely constructive. They therefore have been working in the task forces with Tata and other steel producers to try to minimise the problems and difficulties of the steel industry.
It has unfortunately been a long tale of decline, with job numbers halving between 1998 and 2010 and a reduction of around one-third in production in that area. There has been an improvement up to 2014, with numbers up from 33,000 to 35,000, but, of course, we now have the latest set of difficulties.
All sides need to come together. Obviously, we need to pursue the problems in Brussels. We have colleagues in other member states who also have steel industries that are suffering from the effect of China. We have to engage on the China side. In the various working groups, we have to look ahead because steel is an important industrial sector. One of the things we have been looking at, for example, is how the improved procurement rules that we helped to negotiate in Brussels can be used to help British steel go into major projects such as HS2.
Redcar Steel
Debate between Lord Brookman and Baroness Neville-Rolfe
Baroness Neville-Rolfe
My noble friend asks a very good question, which is the question I first asked when I heard about this great challenge. But we have in fact provided more than £50 million in compensation to steelmakers for energy costs under the emissions compensation scheme. We voted—in fact I voted—for anti-dumping measures on certain Chinese steel products and we have identified a pipeline of more than 500 infrastructure projects to help the industry to win contracts. The trouble is that we have a worldwide problem in the steel industry. I know from talking to the French, the Germans and the Luxembourgers that they share that problem.
Lord Brookman (Lab)
My Lords, following on from the noble Lord, Lord Tebbit, I have a straight question for the Minister. Is it true that the Lord Chancellor, on his recent visit to China, discussed with the Chinese Government and the steel manufacturers using Chinese steel to build the rail for HS2, which is forthcoming? That is of great concern and follows on from what the noble Lord, Lord Tebbit, said. Why are we using foreign steel—Chinese steel—when we have a use for our own steel in this country to build things that we need in this country? We were talking about the steel industry, not about the general politics of industry and so forth. My plea to you last time was to do something for the steel industry.
Baroness Neville-Rolfe
My Lords, I am not privy to discussions between the Chancellor and Chinese senior Ministers, but I do believe in free trade. The point about the visit was to build relationships both ways. I believe that the Chinese can invest in Britain and can be helpful to Britain. Our industry obviously has to be competitive and produce great steel, as they did for example on Crossrail. That is what we need more of. We are looking forward. We are having a summit, which is taking place tomorrow, to look forward at other opportunities and prospects, and I look forward to hearing the results of that.
Redcar Steelworks
Debate between Lord Brookman and Baroness Neville-Rolfe
Baroness Neville-Rolfe
I am grateful to the noble Lord for his many questions, and for his reference to the Enterprise Bill, on which we had a good debate yesterday. As I explained at the end of proceedings then, it has been difficult. The underlying problem is that the SSI operation has never made a profit. The scale of decline in steel around the world is enormous. The world is oversupplied, with overproduction at 30%. This figure appalled me. There are 200 million tonnes of excess tonnage in China, and EU production is 169 million tonnes. We have an enormous challenge.
The right thing is to look forward. That is why we have established a steel summit on Friday in Rotherham, which obviously goes wider than Redcar. The Secretary of State will be chairing it and Anna Soubry will be there, along with all the key outside players, including, obviously, steelmakers such as Tata and Celsa, the trade unions and experts, including Oxford Economics, who are able to look objectively at the global position and look forward to see what can be done.
Chapter 11 has its advantages in some other climes. I think we have debated this before. We find that the insolvency tends to end up being less efficient, particularly in the sort of circumstance we have here, where you have a big global problem. You have to look forward to different opportunities for an area.
Lord Brookman (Lab)
As an ex-general secretary of the union referred to by the Minister and an infrequent speaker in the Chamber, I am pleased that the Minister congratulated the union that I once led, under a different heading. I remember a debate in this Chamber many years ago about the future of manufacturing in the UK, which had particular relevance to the steel industry. It went down quite well—there were 19 speakers —but I was told by one of the inner crowd that we live in a post-industrial society, which implied that banking, the service sector and finance were the way forward.
The steel communities in this country, although there were 267,000 people in the nationalised industries in 1967, are very, very small. My home town in south Wales is decimated: the mines have gone, the steelworks have gone and times are tough.
If the Minister is running this conference next week, she should—please—apply her mind to keeping what is left.
Baroness Neville-Rolfe
I thank the noble Lord for his comments and for his experience. I certainly agree that we should seek to preserve what is good. There are opportunities in the steel industry: there is HS2, if that happens; there is specialist steel; and we have a sector-led strategy on metals. We need to look forward in those areas and to small business creation in Teesside and in other ex-steel communities.
Industry: International Investment
Debate between Lord Brookman and Baroness Neville-Rolfe
Baroness Neville-Rolfe
My Lords, my noble friend makes many good points, some of which I agree with. I look forward to further debates on these issues in the coming weeks and months.
Lord Brookman (Lab)
My Lords, not everything in the garden is as rosy as the Minister has pronounced. Tata Steel, which she mentioned earlier, is withdrawing pensions from its employees, which did not come in for blue-collar workers until 1973, so there will be a call for strike action for the first time in many years in that vital industry. Not everything is perfect at the moment.
Baroness Neville-Rolfe
I agree with the noble Lord that the car industry is vital, and I have been very much encouraged by how it has been changed and revived due to foreign investment but also to the brilliance and innovation of our country. There are always issues as industries change, and he rightly highlights one of them.