Steel Industry

Lord Tunnicliffe Excerpts

2nd reading
Saturday 12th April 2025 Lords Chamber

[Lord Tunnicliffe (Lab)]

My Lords, I rise to totally support the Government and to congratulate them on their draft Bill. I think the actions of the Government have changed the tone of the debate. The role of government is being redefined. There is an acceptance that government is in the business of involvement in industry, where it is necessary. I suspect that, in coming to the conclusions, some sacred cows within government have been, if not slaughtered, certainly put under some new pressures.

There is much debate about jobs. If the initiative that is being taken was about jobs and jobs alone, I am afraid I would be less sure. I suspect that, as a jobs exercise, we would discover the cost per job saved to be rather high, and that rather high price would be a bad precedent. But I support the strategic case. It is impossible to imagine a period in our history since the Second World War where the world has been more unstable. I remember the Cuban crisis—I was a student at the time. It was dodgy, but it was clear, in a sense, that men—and it was men in those days—of a serious conscience would at the end of the day find a solution, and they did. That is not at all clear now. We have all sorts of unstable characters in the mix and we could be a victim of that instability.

When peace breaks out, demand for steel will escalate. The world is in a destructive state: in war zone after war zone there will be a requirement for reconstruction, infrastructure, growth and repair. The demand for steel will escalate in these circumstances. Defence spending will require much more specialist steels. Supply is uncertain, both in areas of specialism and overall. It is wholly credible that the world could run out of steel and, if steel fails, the results for this country would be catastrophic. I believe the Government should press on with this legislation, and I accept the point made by my noble friend Lord Reid that, in the longer term, it will almost certainly lead to nationalisation.

I would certainly encourage the Government to beware the concept of partnership. Partnership is an unusual phenomenon at the level of a steelworks. Both parties need the same objective. A private sector partner that has the size and capability to be a useful partner has got there through the good old-fashioned market objectives of maximising shareholder value. Rather sadly, in this day and age, that is short-term shareholder value. The state is entering a difficult process of maximising the public good. That is what it is there for and I strongly recommend that it does not try to do it in a confusing partnership situation.