Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Tuesday 3rd May 2016 Commons Chamber

[Mr Vaizey]

I think it would take ages—it would take absolutely years to renegotiate. I recently returned from a G7 meeting in Japan, proving again that the leave campaign’s fear campaign is completely wrong. I was able to spend some time with the European vice-president, talking about the great opportunities that the digital single market presents. It was a lot of fun. We want to be part of that digital single market—growing for Britain.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

8. What assessment he has made of the most significant threats to the UK steel industry.

Steel Industry

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Wednesday 14th January 2015 Commons Chamber

[Mr Vaizey]

If I am unable to answer any of the specific questions that were asked in the time allocated to me, the Minister responsible for the industry will write to each and every Member who has contributed to the debate.

The main issues that arose from the debate are the need to compensate the steel industry for the high energy costs resulting from the renewables obligation and other mechanisms designed to reduce carbon, a procurement strategy as part of a metals strategy, business rates, the future of the long products division, and CARES. As the Secretary of State explained at length, we are giving as much energy compensation as we are allowed to give under European rules. We are working as fast as we can to get state aid clearance, so that we can increase the level of compensation. We are working with industry to introduce a metals strategy. We hope that such an industry-led strategy will be produced in the next few months, to be published, provisionally, in the summer.

The future of the long products division is a very serious issue and Ministers are engaged with it. The Prime Minister and the Business Secretary met north Lincolnshire MPs, and the Secretary of State and the Minister with responsibility for such matters met Klesch. As I understand it, our officials are supporting the Syndex report, which will be published this month and will look at the rationale for sale and alternative proposals. We hope that the proposals will come forward at the end of February or the beginning of March. Those could include a commercial solution or working with organisations such as the Green Investment Bank or Infrastructure UK.

As has been well trailed, an extensive review of business rates is being undertaken, and a £1 billion package of business rate support is already in place. We do understand that the steel industry, like other large industries, is concerned that new investment in plant and equipment affects the business rate valuation, thereby increasing business rates. It wants such new investment to be excluded, and I would expect the Treasury to consider that as part of its ongoing consultation. However, Members should understand that this includes the whole business rate framework, and needs to be consulted on.

[Tom Blenkinsop]

Will the Minister give way?

[Mr Vaizey]

I will, provided that other Members understand that doing so will reduce my time to address other points of concern to the thousands of steelworkers watching this debate.

[Tom Blenkinsop]

Perhaps the Minister can give a succinct answer. Given that the Government are not opposing the motion, they must support it. The motion

“urges the Government urgently to reconsider whether mitigating measures on energy prices, planned to start in April 2016, can be brought forward”.

Could they be brought forward before or at the Budget?

[Mr Vaizey]

We are in the hands of the European Commission. There is a bottleneck on state aid and, having previously dealt with a state aid issue myself, I know that despite time being of the essence from the UK Government’s perspective, that is not always the Commission’s view. On energy prices, I remind Members that France has the benefit of extensive nuclear power, and Germany has the benefit of having grandfathered previous state aid rights into its current energy prices and state aid support.

As I have said in other debates, the important issue of rebar has been looked at in some detail and we have asked CARES to examine how it is dealing with it. It has increased sampling and checks—

UK Steel Industry

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Wednesday 3rd December 2014 Westminster Hall

[Mr Vaizey]

We are disappearing down a particular Scottish cul-de-sac. I will leave that as an argument between the Scottish National and Labour parties.

We are working to strengthen existing supply chains by encouraging primes to adopt a collaborative and long-term approach to their suppliers. The hon. Member for Cardiff South and Penarth discussed Chinese imports of rebar. The United Kingdom Accreditation Service looked at the complaint by UK Steel and concluded that CARES had responded in an appropriate way to the concerns expressed in line with the expectations and requirements of the accreditation standard. I can tell him, however, that there has been an increase in vigilance on the part of CARES, with increased sampling and more checks. We have also been advised that, as a result of ongoing discussions between CARES and UK Steel, and of the further testing of some non-compliant imports, CARES visited the Chinese steel mill concerned. CARES conducted further sampling and testing, but it did not find evidence of stock production being non-compliant. On that basis, we genuinely think that we are doing everything possible, although we may be able to do more if the industry provides us with additional evidence of what it thinks that we should investigate.

[Tom Blenkinsop]

The issue of whether it was a Scottish Government or an Executive who sold steelworkers in Motherwell and the rest of the UK down the Yangtse is irrelevant. The real issue is whether the Secretary of State for Business, Innovation and Skills has an ongoing inquiry. If so, is it looking at the steel products that are sitting on dockyards or in warehouses for more than 12 months at a time, rusting away and undermining any usage in a construction project, because of health and safety?

[Mr Vaizey]

I will take that specific point back to the Secretary of State. As I said, there have been discussions between UK Steel, UKAS and CARES. The Government take an interest in such issues. We will go back to those organisations if there is appropriate additional information.

Let me comment on anti-dumping quickly, because time is running out. We have been in contact with the European Commission on a number of occasions over the past year. We have had face-to-face meetings and we have asked the Commission to look at the case for launching an anti-dumping investigation into Chinese rebar imports. The problem is simply that Chinese rebar is only being exported, as I understand it, to the UK market and anti-dumping actions are taken at the European level, which presents serious legal difficulties for the Commission. We think, however, that the Commission is genuinely trying to find a way round the problems. We check regularly with it on progress and encourage it to take action, but at this stage a more aggressive approach might be unproductive.

Steel Industry

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Tuesday 14th October 2014 Westminster Hall

[Mr Vaizey]

I am happy to make that clear. The Government are unequivocal in their commitment to the UK steel industry and will do all they reasonably can to support the industry as it faces the hurdles and obstacles in achieving fair competition. No one denies the climate in which the UK steel industry operates, and we were saddened to hear the announcement last month that the ESCO Corporation foundry in the constituency of the hon. Member for Middlesbrough South and East Cleveland will be closing with the loss of 65 jobs. This will be a very difficult time for all those affected, but I am encouraged that the company will continue trading until the end of the year, particularly as that will hopefully allow employees time to secure alternative employment. A talent retention solution that helps skilled employees affected by redundancy to find jobs in other engineering companies should be able to assist in that regard. He also raised concerns about the current financial position of the SSI integrated steel plant at Redcar, and there are clearly challenges ahead, but the situation is not as serious as recent press reports suggest.

[Tom Blenkinsop]

I did not mention the financial element of SSI because I agree with the Minister. When financial reports are released, they usually provide a 12-month outlook, but the company and its work force have done a lot to overcome many of the barriers. We must send a positive message about SSI because it is coming out of a difficult period.

[Mr Vaizey]

Exactly. I should have said that the hon. Gentleman made it clear that the reports about the current financial crisis at SSI are inaccurate because, of course, there has been investment in new product. In June 2014, the operation turned a profit for the first time since the plant was restarted in April 2012. The plant is currently running at 85% to 90% capacity, and its product is being bought by customers in Canada, the USA, Mexico, Germany, Italy, Turkey, Australia and Thailand. Despite the difficult trading climate, the UK remains a significant player in the global market, although there is no room for complacency. In August, the UK replaced France as Europe’s second-largest crude steel producing country, which was the first time that we have had a higher output than France since January 1997. We have also overtaken Italy for the first time in 17 years. The UK’s steel output has increased largely on the back of new investment and improving efficiency, which is also driving production to record levels not only at the integrated steelworks at Redcar but at Port Talbot. The latest figures show that crude steel production between January and August 2014 increased by almost 7%.

As I said to the hon. Member for Scunthorpe (Nic Dakin), the Government want to assist in any way they can. We work through all channels, at both ministerial and working levels, to ensure a free-flowing, constructive dialogue with UK steel companies. We work closely with the steel industry on a range of issues, including minimising regulatory burdens and regulations, but of course EU state aid rules limit the direct help that can be offered to steel companies. We cannot offer operational aid, but we can offer aid on research and development, environmental protection and some training. Working within EU rules, we are implementing a £7 billion package of measures to address energy costs, including £3 billion to compensate energy-intensive businesses for the impact of policy costs on their electricity bills. We are also directly supporting the long-term future of Tata Steel activity in the UK. We approved £8.2 million of Government funding to support a new R and D centre at Warwick, which is on top of the £20 million offered to Tata over the past three years to enable further investment in R and D. Through the advanced manufacturing supply chain initiative, we have also offered just over £12.7 million towards the £22 million proving factory specialising in the industrialisation and low-volume production of advanced propulsion systems to automotive standards. Tata is a key partner in that project.

We are also working to help the steel industry to win orders. The national infrastructure plan includes 500 projects worth a total of £250 billion for 2015 and beyond. That figure includes more than £1 billion in railway infrastructure. It has also been announced that 95% of the steel for the UK’s rail network will come from Tata Steel for the next five, and possibly 10, years. Who knows? That may continue as we move forward with HS2. Those products should make a difference by stimulating demand for steel, thereby creating significant supply chain opportunities.

The hon. Member for Middlesbrough South and East Cleveland talked about the impact of climate change regulations. I have mentioned the £3 billion support package that we have introduced to offset the indirect costs of the emissions trading system. He said that some of the regulations are simply beyond the technical capacity of any company working in the steel industry, but my understanding is that there will be an opportunity in the next few months to work with the European Commission on the new package that will be in force from 2020 to 2030, so that the regulations can be made more realistic. I will ask my colleague, the Minister for Business and Enterprise, to write to the hon. Gentleman to address his concerns that not enough compensation has so far been paid out to electricity-intensive industries. He is correct that 53 businesses have received just over £41.3 million, but I will check with my colleague whether there is a hold-up on paying out for other issues.

The hon. Gentleman also mentioned Chinese rebar imports. BIS officials have raised concerns with the European Commission, and we understand that the Commission is still considering the possibility of opening an anti-dumping investigation. We will consider the evidence providing by the Commission, but at this stage we would support any Commission decision to open an anti-dumping investigation.

This debate on the UK steel industry has been important. As one would expect, the hon. Gentleman and his colleagues have highlighted critical issues for industries that are incredibly important not only to their constituents but to the economy of the UK as a whole. I will take his remarks in the spirit in which they are intended, and I will take them back to the Department. I will highlight his perfectly understandable concerns about the impact of climate change regulation on energy-intensive industries and the possibility of reform. He has expressed concern about imports from outside the EU that may have a large carbon impact. His focus has been on ensuring that there is provision to secure the supply chain. I hope that he and his colleagues have heard the message that I have tried to convey as a relatively new Minister in this field, which is that the Government take the steel industry seriously and will do all within their power to help.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Thursday 13th September 2012 Commons Chamber

[Mr Vaizey]

I thank the hon. Gentleman for his kind words, and I regret that must I disagree with him. I think the licence fee settlement was excellent for the BBC. It provides funding certainty until 2017, which no other media company in this country can boast.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

6. What discussions she has had with the Secretary of State for Education on the protection of school playing fields.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Thursday 14th June 2012 Commons Chamber

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

14. What plans he has for the post of Registrar of the Public Lending Right.

[The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (Mr Edward Vaizey)]

As the hon. Gentleman knows, we are consulting on the future of the Registrar of the Public Lending Right. Our proposed transfer of the function of the registrar, which currently exists as a stand-alone public body, would contribute to the Government’s commitment to simplifying the public bodies landscape and at the same time maintain and ensure the effective, efficient and impartial administration of the PLR scheme.

[Tom Blenkinsop]

I thank the Minister, but does he agree with the second children’s laureate, Anne Fine, that the proposed reorganisation of the registrar is based purely on ideology and will cost the taxpayer more money than it saves?

[Mr Vaizey]

No.

Oral Answers to Questions

Debate between Lord Vaizey of Didcot and Tom Blenkinsop

Monday 26th July 2010 Commons Chamber

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

T4. Guisborough and Skinningrove in my constituency suffer from bad TV reception, and certain channels are unobtainable. Both areas are served by relay transmitters rather than masts. Will the Minister confirm the date for digital switchover in both communities, and provide details of the funding of the switchover? Will he also give me a guarantee that the residents of those areas will be able to receive all Freeview channels once the process is complete?

[The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (Mr Edward Vaizey)]

By the time digital switchover ends in 2012, everyone in the country should be able to receive at least 15 Freeview channels, but I would be happy to meet the hon. Gentleman to discuss any particular problems in his constituency.