Steel Industry

Lord Hannan of Kingsclere Excerpts

2nd reading
Saturday 12th April 2025 Lords Chamber

[Lord Hannan of Kingsclere (Con)]

My Lords, the question posed by the noble Lord, Lord Kerr of Kinlochard, and then repeated by my noble friend Lord Moylan hangs in the air of your Lordships’ Chamber, brooding and unanswered: what is the justification for having a permanent, open-ended commitment to subsidise domestic production? We have heard a perfectly reasonable case that we need lots of steel and security of supply. I agree with that, but the way to have security of supply, whether of steel or anything else, is to source from the widest possible variety of sources so that you are not subject to a localised shock or disruption, which might as easily happen in your own territory as anywhere else.

That is exactly where we are with steel. There is no foreign country that accounts for more than 15% of our total imports—not our total use, our total imports. It is an extremely comfortable position. There is a very widespread view, I think, outside this Chamber that we are somehow dependent on China or other unfriendly autocracies. We heard it from the noble Baroness, Lady Drake, a moment ago, but which countries actually are our chief suppliers? The first is Germany, the second is Spain, the third is the Netherlands and the fourth is Belgium. If, in some bizarre world, we were blockaded by the EU, we would still be able to import from Algeria, Turkey, Vietnam and South Korea before we got to China, which accounts for only 7% of our imports. We need to be realistic about the numbers.

If, for whatever reason, we decide that, despite that, we must have some kind of domestic production capacity at whatever cost then the easiest way to ensure that is to make our industries competitive by no longer imposing on them the most expensive energy costs in the developed world. We seem to have forgotten that actions have consequences. We pass resolutions and laws, we make decisions that make us feel warm and comfortable about net zero, such as not allowing the coking coal mine in Cumbria to be opened, and then we wonder at the consequences. If we want to have a domestic steel capacity, the way to do it is not to burden the producers and, indeed, our taxpayers with the costs of this policy and to be honest about the realism of deferring it.

I close by saying that we are again about to take a decision that will have consequences, which will be a repeat of a policy that has never, ever worked: the nationalisation of steel, which fails every time. It is like that scene of Homer Simpson constantly trying to grab his beer can from some electric wires and electrocuting himself each time and going back to it. In 1949 and in 1967, nationalisation led to disinvestment and maladministration, to political rather than economic decisions and, in the end, not only to the failure of the industry but to taxpayers being left on the hook, as it will this time, to the tune of £700,000 a day in this case.

“… the Dog returns to his Vomit and the Sow returns to her Mire,

And the burnt Fool’s bandaged finger goes wabbling back to the Fire”.

Employment Rights Bill

Lord Hannan of Kingsclere Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Hannan of Kingsclere (Con)]

My Lords, what a privilege to follow the fourth of those four outstanding maiden speeches. I reassure the noble Baroness, Lady Hazarika, that I echo her sense that the humanity and dignity of the noble Baroness, Lady Berger, in the face of extraordinary provocation, was an inspiration not only to the many people who uphold the best and most decent tendencies in the Labour Party, but to everyone in this country who values tolerance, religious pluralism, civility in public discourse and the supremacy of parliamentary life. I hope I will not destroy her credibility when I say that of all the people in the independent group, she was the only one I was secretly rooting for during that bizarre moment in our political life.

What a pleasure, also, to follow my noble friend Lady Cash—my friend of three and a half decades. I remember seeing a picture of my noble friend in the Observer, in about 2009, with the most extraordinary array of lefty lawyers, including, if memory serves, the noble Baronesses, Lady Chakrabarti and Lady Kennedy of the Shaws. They were making this great defence of liberty, and that has been her core belief throughout her political career. It was very apt that, when she stood for another place, she fought in Westminster, the constituency of both JS Mill and of John Wilkes. If there is one precept that this country has developed and exported, and contributed thereby to the happiness of humanity, it is personal autonomy.

My real privilege, however, is in following and welcoming my noble friend Lord Young. He is a one-man advertisement for the hereditary principle. It is an unfashionable cause to be making at a time like this. He did not mention that his father was a Labour peer. You would have got it, if you were listening between the lines. His father was best known for writing a book on meritocracy, which he was against. My noble friend has had a career that tests the outer limits of what we understand by meritocracy. Right from the start, he got into Oxford on the basis of having received an acceptance letter in error. They posted it by mistake, even though he failed to make the grade. He then successfully argued that they had a moral obligation to take him anyway. He went on to have this extraordinary career, which I can only describe as cinematic—in the literal sense, in that a film was made in 2008 of my noble friend’s life; he was played by Simon Pegg. The only other person I can think of who has had a biopic before he was elected to anything is the current Vice-President of the United States. But I will not push that resemblance.

My noble friend then went on again and again to show that quirkiness, that independence of character and that courage that is, I think, one of our greatest virtues as a people. I mean no disrespect to our political system when I say that you can get to this Chamber by being careful and correct and conformist in your views. I know one or two people who have made it to the top in politics by waiting until everyone else has spoken before they express a view, by knowing how to nod sagely and talk slowly. No one would describe my noble friend in such terms.

The two particular causes with which he has been most recently associated—the Free Speech Union and the Critic, which began as an anti-lockdown campaign—showed extraordinary moral courage: not the simple courage which some people have and some do not but that readiness, that intellectual readiness, to be incredibly unpopular but to stand by a position that you know to be right. Personally, I have to say that, on the lockdown, I remember the days when people were accusing him of being a eugenicist and a mass murderer and all the rest of it, but with every day that has passed he has come to be more and more vindicated.

Turning to the Bill itself, I can be very brief. I am afraid I find that it contains absolutely no redeeming qualities whatever. I could go on at length about what is wrong with it, but I would be repeating many of the arguments that we have already heard, not least from my noble friends Lady Barran, Lady Coffey and Lady Noakes. I will focus on just one solitary provision, which is the rights from day one. I think we are in real danger in this nation of having more and more workers’ rights and fewer and fewer workers. Here is an unpopular truth that people very rarely like to admit and never really like to verbalise: the way of encouraging people to hire is to make it easier for them to fire. The way in which you encourage employers to take on more staff is to give them the reassurance that they are not going to be stuck with duds or embroiled in weeks and weeks of acrimony for the price of a second-class stamp or an email by somebody who they had then to remove from employment.

That has been the secret of our country’s success for some three decades. Whatever the world has thrown at us, including the global financial crisis and the pandemic, structural employment has always been higher here than in Europe because we have this relative flexibility in our labour market that means that we bounce back very quickly from downturns because companies are prepared to take people on. I think that is ceasing to be the case now. I speak as the father of two children who are just entering the workplace and I listen to what their friends are saying. If you speak to anyone of that age, there is a palpable freeze now, an uncertainty among employers, in anticipation of both this Bill and the related rise in national insurance. I have a fear that those 30 years of structurally low unemployment are about to come to an end.

Noble Lords will be able to look back at my words and laugh at me if I have got this wrong, but I suspect that we are at the beginning of what is going to be a sustained and secular rise in unemployment. As I say, I hope to heaven that I am mistaken about that, but, as Scotland’s national poet once said:

“An’ forward tho’ I cannot see,


I guess an’ fear!”

Tariffs: Canada and Mexico

Lord Hannan of Kingsclere Excerpts

Tuesday 4th March 2025 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

My Lords, we are aware that the US has imposed a tariff on all Chinese goods. I reiterate that it is not for me to comment on another country’s bilateral trade relationships—that is a matter for the US—but we are of course aware of China’s retaliatory response. We respect China’s dialogue with the US and will not intervene. However, the Government are prepared to take any necessary action to mitigate the potential economic impact on our businesses and will continue to monitor the situation.

[Lord Hannan of Kingsclere (Con)]

My Lords, to return to the Minister’s first Answer, of course I am sensible that there are things that you do not say in public, but I hope that in private His Majesty’s Government are making it clear that we have an interest in free trade within North America. We are the largest investor in the US and we will be affected by US tariffs on every component part that will be hit by them. We also have an enduring interest in the prosperity of Canada. How can anyone in this country think of Canada without thinking of Vimy Ridge, Juno beach and a hundred other battlefields where it has stood alongside us? I hope we will make it very clear that free trade between the United States and Canada is a British national interest.

[Baroness Jones of Whitchurch (Lab)]

My Lords, Canada is a valued partner for the UK, including as a Commonwealth member state, and our shared ties are deep and historic, as noted by our respective Prime Ministers when they spoke on 5 February. Our trade relationship, which was worth more than £26 billion in the four quarters to the end of quarter 3 in 2024, supports jobs and businesses on both sides of the Atlantic. This is underpinned by our trade continuity agreement. These relationships are important and ongoing. We will continue these discussions and hope to further and deepen our ties with Canada in due course.

National Minimum Wage

Lord Hannan of Kingsclere Excerpts

Wednesday 21st February 2024 Lords Chamber

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that. There is a wage scale, as he will well know. For those aged 18-20, it is £8.60 an hour and for those under 18 it is £6.40 an hour, an apprentice rate. The point of this is a scale. We all start work on lower wages and increase our wages as our skill levels increase. We must not be in a situation where we, in effect, lock young people out of the market. We must ensure that young people get into the market earning wages and then increase their skills and their wages. The noble Lord will know well that many studies have been done on the wage scar, which blights young people if they do not get into a job early and get training. We want young people in a job early, trained up, so they can increase their wages.

[Lord Hannan of Kingsclere (Con)]

My Lords, has my noble friend the Minister’s department made any assessment of whether these increases in the minimum wage, which go well above and beyond average wage increases, have impacted the ability of companies to take on interns, which is normally the main route into employment; whether they have had an impact on speeding the adoption of automation and assimilating the upfront costs; whether employers respond by cutting in-work benefits, discounted meals and so on, to compensate; and, not least, what the impact is on the price rise of the finished product, because often people on minimum wages are also consumers of minimum wage products? If, for example, fast food becomes much more expensive, it is not going to be hedge fund managers who pay.

[Lord Offord of Garvel (Con)]

I thank my noble friend for that. The cost to business is a consideration that we must consider. The cost of this particular increase will be £3 billion over six years and I emphasise that it will fall largely on the SME community. Some 99% of our companies are SMEs, with 2.5 million VAT-registered companies. Setting aside the 10,000 companies that employ 30% of the workforce, 60% of the workforce are employed in SMEs and they are bearing the brunt of exactly these wage increases. We survey employers and they want to pay higher wages. We want a good, well-paid workforce but we must do so in a way that balances the needs of business and workers.

UK-Canada Trade Deal: Suspension of Negotiations

Lord Hannan of Kingsclere Excerpts

Tuesday 30th January 2024 Lords Chamber

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that question. We fundamentally agree with that. We have been talking with the cheese manufacturers all the way through this. We send £200 million-worth of food to Canada and it sends us the thick end of £600 million back, mostly wheat, maize and lobster. However, we do not want to take the hormone beef. That is where the beef is. The issue, therefore, is that we have £18 million of trade that we need to try to support, and we will do our best to support those impeccable farmers, especially in the West Country and in Wales.

[Lord Hannan of Kingsclere (Con)]

My Lords, Canada is notorious for gearing its trade policy around its dairy sector, which is particularly strong in Quebec. However, is not the wider issue here whether Britain will always follow EU rules on sanitary and phytosanitary standards? According to the WTO, SPS measures must never be economic and can be justified only by science. The EU’s ban on these various kinds of beef has been condemned by its own scientific advisory agency and by the WTO. Is it the view of my noble friend the Minister that our SPS regime, as long as it is tied to the Brussels one, it is compatible with WTO regulations?

[Lord Offord of Garvel (Con)]

This is the issue. Canada has been in a recent—2016—deal with the EU and understood the SPS rules of the EU. It understands fundamentally that we are not reducing our rules on SPS, but it has seen an opportunity, and you go for the gap when you see the opportunity, do you not? If you are a trade negotiator, you think to yourself, “Where can I get my point of advantage?” On our two outstanding issues, the cheese and the rules of origin—where, again, we are pretty much sorted with a rollover from the EU—Canada has seen an opportunity to cross that line. It is a pause in negotiations and we will get back round the table as soon as it comes back over the red line.

British Steel

Lord Hannan of Kingsclere Excerpts

Wednesday 8th November 2023 Lords Chamber

[The Earl of Minto (Con)]

My Lords, I do not think I said that we are throwing employees into a wide market. In fact, I think I said that we would provide support to see them through the transition. We have a fair and open market for Chinese investment in this country. It is a major world trading relationship and, while I understand some of the political issues behind it, just to avoid a country of that weight is slightly isolationist.

[Lord Hannan of Kingsclere (Con)]

My Lords, will my noble friend the Minister confirm that the industries that use steel employ many more people than the industries that make steel? We have 34,000 steelworkers and 176,000 people making cars. We have the better part of 0.5 million working in agriculture and 2 million working in construction. The way to protect jobs is to bring the price of steel down, not raise it. Will my noble friend confirm that our Trade Remedies Authority found no case whatever for the tariffs that we have inherited from the EU and continue to maintain on imported steel? Will he make clear that the way to make this country competitive is to remove excess costs on energy so that our industry can compete? By the way, we are still our own biggest supplier by far, and no foreign country accounts for more than 14% of our imports.

[The Earl of Minto (Con)]

That was a very detailed question indeed, with which I entirely agree.

Baby-changing Facilities

Lord Hannan of Kingsclere Excerpts

Tuesday 6th June 2023 Lords Chamber

[The Earl of Minto (Con)]

Although that is not entirely within my brief, I entirely agree.

[Lord Hannan of Kingsclere (Con)]

My Lords, I wonder whether the Normandy landings would have been so successful had they all been obliged to have baby-changing facilities on every vessel. This idea of state regulation for baby changing takes the nanny state to a literal level. Can my noble friend the Minister confirm that, in the other place, the Government were elected on a manifesto promising minimal regulation, and that providers of services have every incentive to offer their customers the best deal they can afford without needing to be told what to do with the full coercive power of state law?

[The Earl of Minto (Con)]

My Lords, I entirely agree. In fact, my role is about regulation and reducing the amount of it. We should all agree that, by reducing regulation, business becomes easier and more productive, everybody’s salaries improve and there are increased job opportunities.

CPTPP: Conclusion of Negotiations

Lord Hannan of Kingsclere Excerpts

Wednesday 19th April 2023 Lords Chamber

[Lord Hannan of Kingsclere (Con)]

I congratulate and thank my noble friend the Minister for enlivening this Eeyore-ish mood with some Tigger-ish enthusiasm. The benefits of CPTPP seem to be obvious to the lengthy list of countries which have formally applied for or are mulling membership—a list which includes Thailand, Taiwan, South Korea, the Philippines, Costa Rica, Ecuador, Colombia and Uruguay. Of course, I understand that my noble friend is bound by diplomatic protocol, but will he take this opportunity to express some optimism about the prospect of the United States joining that list? CPTPP was to a large degree negotiated not just by senior members of this Administration but by President Biden himself. American accession to that pact would allow an improvement in the terms of trade between our countries, bound together as we already are by language, law, custom, kinship, habit and history.

[Lord Johnson of Lainston (Con)]

I am always grateful to my noble friend for his eloquence. He is a very difficult act to follow, even though his question is so true to my heart. I am afraid I will not be drawn into suggesting who should potentially be admitted into the CPTPP because we are not yet members, but as I said, I am delighted that this entire organisation acts as beacon of free trade around the world. We want more countries to see the world through the lens of us and our aligned partners. I very much support, conceptually, many of my noble friend’s comments and I thank him for his support in this House and for continually making sure that the torch of free trade is held high in this place.