Steel Industry

Debate between Angela Smith and Hannah Bardell

Thursday 3rd November 2016 Westminster Hall

[Angela Smith]

I completely agree. Potentially, this is an exciting new industry for the UK that would provide reliable baseload energy to meet the nation’s needs. The steel necessary for building those tidal energy projects will come not just from south Wales, but from Firth Rixson and Forgemasters in Sheffield. It will involve some of the best and most technologically sophisticated steelmaking available in the UK. Is the Minister absolutely committed to ensuring that the voice of the steel industry is heard at the heart of Government in looking at whether we give the project the go-ahead? Can we look forward to hearing something specific about that in the autumn statement?

[Hannah Bardell (Livingston) (SNP)]

The hon. Lady’s point about tidal and wind energy is absolutely key. Does she agree that the Government’s lack of support and their pulling of support, particularly in the wind energy sector, will have a knock-on impact? That is a serious opportunity for steel production missed by the Government.

[Angela Smith]

A number of opportunities have been missed over the years, and wind energy is one of them. The turbine-making capacity is not now available here in the UK. Wherever possible, it would be good to see the Government attempting to work with industry to put those mistakes right and see what we can do to develop that capacity in future.

Unlocking all that potential will mean an active industrial policy from the Government. Will the Minister therefore reassure the House that UK steel will be at the heart of the forthcoming industrial strategy? As was mentioned earlier, will he give an absolute commitment that steel—which, let us remember, is a foundation industry—is an ongoing priority as we await the publication of the strategy and that it will be at the heart of everything that the new Department does between now and next spring, when the strategy is introduced?

In an industry where investment is vital and timescales are long, certainty is important, so my concluding remarks are of course about Brexit. It is my firm view that, as an industry, steel needs full access to the single market. That is vital, especially when one considers that 50% of all the industry’s exports go to the European Union. Given that the automotive industry has secured a guarantee from the Government, as we leave the European Union, to allow the necessary investment and ensure that it continues in Sunderland—I absolutely welcome that, by the way; it is great news for Sunderland and really important for the UK economy—will the Minister tell us whether we can expect the same sort of guarantee for the steel industry? It is critical that the steel industry should be able to continue to enjoy access to its key markets. Let us remember that many thousands of jobs depend on a successful steel sector.

Steel is vital to a country that wants to continue to be a manufacturer. We need the Government to be fully engaged in helping the industry not just to survive but to develop and to provide security against the uncertainties of the global economy. The future is not going to be easy and although Brexit is frequently posited as bringing many opportunities—these nebulous opportunities that have yet to materialise—we can be absolutely certain that it will deliver more than its fair share of challenges. The steel sector will need the Government to be an active partner to help it to deal with the uncertainties it faces.

What happens to the steel industry if, when we Brexit in two years’ time—presumably in April 2019—the Government have not negotiated a long-term deal? What happens if they have not even be able to negotiate a transitional deal with the European Union? What happens to the steel industry if we end up falling back on World Trade Organisation rules? The Government need to be clear and to work closely with the steel industry and Parliament to ensure that those uncertainties are minimised and thought through, and that we are absolutely certain that, in the worst-case scenario, the Government will be there with a plan to support the steel industry as it moves forward—indeed, to support all manufacturing industry. That question is critical and is worrying the business sector to a degree that I have never seen before in my lifetime in politics.

A country without a steel industry cannot class itself as a major economy. The stakes are that high, and I implore the Minister and the Government to do everything necessary to make sure we secure a thriving steel industry for the future, preferably with the UK as a full member of the single market. Whatever happens, we need to ensure that the Government, who had no plans for Brexit, certainly have a plan if the worst materialises in two years’ time.

--- Later in debate ---

[Hannah Bardell]

I will take that point on board, but the hon. Member will know that much of that steel was rolled and developed in Scotland. Nevertheless, I thank him for his clarification.

I was going on to say that one of the reasons that situation came about was the closure of the Ravenscraig steel mill by a previous Tory Government in 1992. I know that Labour Members—the predecessors of the Labour Members here today—fought hard alongside our party’s Members to save Ravenscraig. I pay tribute to all those Members who tried to save Ravenscraig.

That comment by the former Prime Minister reveals the lack of understanding about Scottish steel and indeed about steel across the UK, and the cavalier attitude with which such statements have been made about the industry. We cannot let that continue; there must be, as so many Members have said today, proper commitment from the Government.

I say that because the issues that we are discussing today are not limited to the steel industry but extend to British industry in general. Post-Brexit, the uncertainty and anxiety are greater than ever, because we have no idea what kind of deal many industries will get. We know what the car industry will get, although we do not have the detail of that deal. We do not know whether other deals will be made sector by sector, or area by area. Before the Brexit vote, we knew that the international demand for steel was falling: the OECD had said that excess global capacity was expected to widen to 645 million tonnes. Now, post-referendum, the pound is falling, so UK steel will be cheaper for foreign buyers, but as other Members have said, the cost of the imported raw materials will be higher in the long-term, which will make things very difficult.

I congratulate the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) on securing this debate and on the passion with which he spoke. He highlighted the contrast between the approach and guarantees given to Nissan and the automotive industry with the support for the steel industry. That is ironic, given that the World Steel Association has said that on average 900 kg of steel is used per vehicle. So we will be making cars in Britain but importing the steel to make them and many parts of those cars. I hope that irony is not lost on the Government and that they take this issue very seriously.

Strong anti-dumping measures are critical. They were nearly secured with our EU partners. In our view, it is indefensible that the UK Government blocked EU attempts to regulate Chinese steel. The hon. Member for Corby spoke about the importance of the all-party group on steel and metal related industries and its collaboration with others. He made a plea to Tata for more information and said that the Government’s leadership would be key. Although he is a self-professed Brexiteer, he wants better leadership. However, given that it was the UK that blocked the EU attempts to regulate Chinese steel, I am not sure how he thinks the UK will do a better job. He was not able to answer that question earlier; perhaps the Minister will be able to answer it. We are all interested to know how the UK industry will fare if the UK ends up operating under World Trade Organisation rules, as the Secretary of State for International Trade has said. To be fair, the hon. Member for Corby was encouraging his colleagues in the Government to be proactive in their industrial strategy and said they needed to champion steel.

The hon. Member for Sheffield Hillsborough spoke passionately about the speciality skills and products produced in her constituency and the importance of the Prime Minister’s visit to India next week in ensuring the future of speciality steel—

[Angela Smith]

I was the Member for Sheffield Hillsborough; I now represent Penistone and Stocksbridge. The shadow Minister, my hon. Friend the Member for Sheffield, Brightside and Hillsborough (Gill Furniss), is now the MP who represents Hillsborough.

[Hannah Bardell]

My sincere apologies. My lack of parliamentary constituency knowledge has failed me there, so I sincerely apologise to the hon. Lady and I thank her for her intervention. I will be honest—on this occasion, Google has let me down.

The hon. Lady spoke about how a country without a steel industry could not call itself a major economy. We in Scotland are proud and glad to have secured steel and to call ourselves a major economy, but we worry for our neighbours and friends in other parts of the UK. I agreed with so much of what she said, particularly on renewables and single market access.

The hon. Member for Wellingborough (Mr Bone) gave us an insight into which team he is on; it is clear that he is backing the new “May Way” and not the old Cameron regime. He urged us to be positive about the future and mooted the merits of free trade and market access. He agreed that we should be tackling the issue of Chinese dumping as well.

The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards)—I hope I have got that right—talked about the future of steelmaking in Wales and about his party’s desire to remain in the single market, as well as the importance of the single market and the customs union. He also highlighted the short-term upturn in the steel industry and the report from Swansea University that said there are opportunities in the long term to strengthen factories such as Port Talbot, but swift strategic action was essential. I wish him well in getting either swiftness or strategy from the Government. He also spoke about the Liberty and Excalibur deal and the importance of giving it careful consideration.

The hon. Member for Redcar (Anna Turley) spoke extremely passionately about the SSI closure—it was a highly efficient and productive plant—and the devastating impact that has had on her constituency. I congratulate her on the work she has done. I agree that it is devastating that the plant could not be mothballed. I am at pains to know why that could not have been done. I cannot understand it. I hope the Minister has more than warm words for her and her constituents.

The hon. Lady’s colleague the hon. Member for Aberavon (Stephen Kinnock) spoke about the tragedy of Port Talbot and the cloud hanging over him and his constituency. Again, the message was clear: swift and decisive action is needed, particularly given that the cost of raw materials will rise once we leave the EU.

The hon. Member for Hartlepool (Mr Wright) spoke of his admiration for his colleagues and what they were doing every day. Other Members spoke about the personal impact the issue is having. It is so important that we send that message to people outside. Members are in their constituencies as much as they can be, but with so much business here, balancing things is a big challenge. I know from travelling up and down the country how difficult that can be. We may have many differences of opinion, but the hon. Members for Scunthorpe (Nic Dakin), for Neath (Christina Rees) and for Newport East (Jessica Morden) sent a clear message. They made passionate pleas to the Government.

The consensus and the message is that we need strategy, action, investment and access. Those things are not outside the grasp or ability of any Government. The Government need to act now to save jobs and an industry that is vital to constituencies and areas across the UK. Through that, the communities of Members here today can be protected.