Britain’s Industrial Future

Alex Cunningham Excerpts

Tuesday 15th November 2022 Commons Chamber

[Grahame Morris]

rose—

[Alex Cunningham (Stockton North) (Lab)]

rose—

[George Freeman]

Let me finish this point.

Thirdly, the tightening of the global energy markets has hit many energy-intensive industries hard. We have announced £25 billion of support for the next six months. That is far from the doom and gloom of the motion, which, for anyone who reads it, paints a picture of this Government having no strategy or policy for industry, which is complete rubbish.

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[George Freeman]

Indeed, fantastic things are happening at NETPark. One would think that the Labour party, which dominated County Durham politics for decades and seemed to indulge in the poverty up there, would celebrate the phenomenal turnaround in the north-east. It is one of our leading manufacturing regions. NETPark is home to Kromek and Newcastle is home to QuantuMDX. That is a great story of British manufacturing driving an advanced economy in the areas that were blighted by painful deindustrialisation. I am proud that the Conservative party is in the vanguard of that.

[Alex Cunningham]

There is no doubt that we have new manufacturing to celebrate in the north-east, but Teesside’s steel industry is a shadow of its former self. It has a few hundred jobs, instead of the many thousands that existed a few years ago, before the Government abandoned us. Does the Minister agree that we should invest in Teesside steel now and use its product for the new industry jobs that we are promised?

[George Freeman]

That brings me to steel, and the hon. Gentleman makes an important point. There has been real pressure on the steel industry in the past 15 to 20 years. Global economic conditions are hugely challenging for all domestic steel sectors. There has been massive overcapacity, unfair overseas subsidies and steel dumping. The real issue is that global steel production has more than doubled since 1995 and China is by far the biggest contributor to that growth. In 1995, China accounted for 13% of the world’s steel production. By 2019, that had risen to 53%. There has been a phenomenal change in the global steel market.

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[Alex Cunningham (Stockton North) (Lab)]

I draw the House’s attention to my interest as the chair of the all-party parliamentary groups on chemicals and on carbon capture, utilisation and storage. Nowhere needs to see our industrial future secured more than Teesside. Unemployment there remains way above the national average, and no wonder. As my hon. Friend the Member for Middlesbrough (Andy McDonald) said, the Tory Government turned their back on the Teesside steel industry at the former SSI site and 3,000 people lost their jobs. Despite Tory promises, Cleveland Bridge & Engineering, which built bridges across the world, including the Sydney harbour bridge, was allowed to go under after a history stretching back to 1877, with hundreds of highly skilled workers losing their jobs.

When the Sirius mine project, largely owned by local people, many of whom sank their life savings into it, ran into cash-flow problems, the Tees Mayor promised support, only to be slapped down by his own Government, who paved the way for a multinational company to take over. Then there is the fishing industry. That too has been decimated as fish and other sea life have died off. The real cause of that has yet to be determined, but today I welcome the fact that the Government have set up an independent group of experts on that.

It is not all doom and gloom. The Tees could be home to the first carbon capture, use and storage project to get under way, but we now need action from the Government on the business case and contracting arrangements to make that happen. Perhaps the Minister can confirm that it will go ahead and that a second wave of projects will also be forthcoming. Then there is the potential of the controversial freeport and Teesworks sites, which we are told will be home to thousands of green industry jobs. I only hope that the Tees Mayor will deliver this time. He has promised mouth-watering numbers of jobs over his five years as Mayor, but there has been no more than a trickle so far.

I do, however, worry about who will benefit from any development there. As we have already heard from my hon. Friend the Member for Middlesbrough, 90% of the shares in the Teesworks site were handed to two private companies, and I agree that it is time for a full inquiry into how that process worked and when they acquired those hugely valuable assets. As for the freeport, I desperately want it to succeed, but not just for the entrepreneurs—it must also succeed for the people of the Tees Valley. I am worried about the potential for the terms and conditions of people working there to be dumbed down. We want high-value jobs, but not where highly skilled people are exploited for other people’s profit.

I now turn to energy-intensive industries, which are so important to Teesside. Already we have seen CF Fertilisers stop manufacturing ammonia, choosing instead to import it, and I know that another company nearby could be facing closure with the loss of 600 chemical jobs if things do not change for the better. Chemicals are critical not only to the local economy; they also contribute to the UK economy as a whole. We rely on them day after day, from the water we drink, the food we eat and the medicine we use to the mobile phones in our pockets and the electric vehicles on the roads. It is estimated that around 95% of all manufactured goods rely on some form of industrial chemical process. According to the Chemical Industries Association, 4,535 chemical businesses provide over 500,000 direct and indirect jobs, including factories and laboratories operated by a highly trained and skilled workforce.

That sector is one of the UK’s biggest manufacturing industries, with £33 billion of annual exports contributing £31 billion a year to the UK economy, but it is also under the cosh. These numbers are hard-won, and we as a country must do everything possible to secure and grow them further. There is no modern successful economy in the world without a chemical industry, and no other industry is so fundamental to economic, social and environmental progress, but the ramifications of high energy prices are affecting businesses across the board. This is why I have raised the contribution of the chemicals industry, in the hope that the Government will be reminded what is at stake should they not put together an effective industrial strategy. Labour recognises that the job of Government is to offer a reliable and consistent policy framework that businesses can trust and invest alongside, over the longer term. That is what they really want.

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[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)]

I must pass on the apologies of the Secretary of State for not being able to attend the debate, due to a Cobra meeting.

I thank all hon. Members who have contributed to the debate. Listening to the contributions, I cannot help but feel that reports of the death of British industry have been greatly exaggerated—that is probably not what the speakers meant, but that is definitely how it sounded.

From the aftermath of the global financial crisis to the coronavirus pandemic and, more recently, damaging disruption to worldwide supply chains, there is no doubt that global economic turmoil in the past 12 years has presented significant challenges for manufacturing in the UK. Nevertheless, to the shadow Minister’s point on slow growth, it is good to note that the UK has grown at about the same pace as the United States since 2010, and faster than Germany since 2016. It is important to have the facts. In the same period, we have come to understand the scale of the climate change challenge and the transformation that will be required in every element of our economy.

I will first touch on some of the contributions from both sides of the House. It is fair to say that there were some valuable contributions on both sides, although I probably have more in common with the comments from the Conservative side of the House. My right hon. Friend the Member for Wokingham (John Redwood) talked about making sure that we have a fair and level playing field in competition with overseas markets. Our “Steel Lady”, my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), rightly said that steel’s future was part of the solution for net zero, rather than part of the problem. My hon. Friend the Member for Stoke-on-Trent North (Jonathan Gullis) talked about the 9,000 high-skilled, well-paid jobs created by this Conservative Government.

My hon. Friend the Member for Sedgefield (Paul Howell) talked about the green hydrogen opportunities on Teesside. My hon. Friend the Member for Heywood and Middleton (Chris Clarkson) talked about the £407 billion committed by this Government to saving jobs and businesses during the pandemic. My hon. Friend the Member for Milton Keynes South (Iain Stewart) talked about place-based solutions to growth, which I entirely agree with.

My hon. Friend the Member for Guildford (Angela Richardson) talked about the opportunities in the space and satellite sector. My hon. Friend the Member for Peterborough (Paul Bristow) talked about investing in British talent, in students and workers, which I also agree with.

[Alex Cunningham]

This is my second opportunity to welcome the Minister to his position, this time at the Dispatch Box. He heard me talk about carbon capture and storage. George Osborne wheeched away £1 billion overnight from the project several years ago. Can the Minister guarantee that the same is not going to happen to the carbon capture industry this time?

[Kevin Hollinrake]

The hon. Gentleman made some good points about the opportunities on Teesside. Carbon capture and storage and Net Zero Teesside represent a huge opportunity and something that is on the Government agenda. We are also looking into the life sciences sector in Teesside and the first large-scale lithium refinery in the country, with 1,000 jobs in construction—all these things are happening on Teesside. I recognise his point on the steel sector, but all this carbon capture and storage may well form part of the future for Teesside.

The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) made some interesting points about buying British. I think everyone in this House would agree on the need to buy British, but does he accept that, that as the trade and co-operation agreement and others open up EU markets to UK companies, we cannot on that basis expect to close our markets to EU countries, or to countries from around the world? We believe in international trade—[Interruption.] Well, I also believe in buying British. I share his enthusiasm for the Government’s £206 million investment in a UK Shipping Office for Reducing Emissions—the biggest Government investment ever in that sector.

Manufacturing has been at the heart of our economy for centuries—the shipbuilding, automotive and steel industries perhaps more than any others. In 2021, manufacturing contributed more than £205 billion gross value added to the UK economy, which is the fourth highest figure in Europe. Manufacturing, which is responsible for almost half of UK exports, has a vital role to play in driving innovation, job creation and productivity growth beyond the bounds of the M25. The hon. Member for Kilmarnock and Loudoun (Alan Brown) will be pleased to note that 95% of manufacturing jobs are outside London.