Post-SSI Support Package: Redcar

Anna Soubry Excerpts

Tuesday 19th January 2016 Commons Chamber

[The Minister for Small Business, Industry and Enterprise (Anna Soubry)]

I congratulate the hon. Member for Redcar (Anna Turley) on securing this debate, and on placing on public record—this does not have anything to do with party politics—that undoubtedly, throughout this wholly unfortunate and sorry episode, she has always fought hard for her constituents, which she will of course continue to do. Obviously, we do not agree politically at all, but we do agree on the huge resilience and the remarkable achievements we can already see, notwithstanding the terrible closure of SSI. We are agreed about the remarkable people she represents and all that has been achieved, although there is of course an awful lot more to do.

The hon. Lady makes a very good point. In such difficult times, with the closure of a very important industry that employs a lot of people in an area where not many people live—in other words, the industry has a huge impact on the local community—or with a large number of redundancies, as we saw yesterday with the Tata decision about Port Talbot, we must learn the lessons from our being there to support them financially and by setting up bodies to administer the money. She has quite properly highlighted several problems and difficulties. She makes the good point, although it sounds perverse, that we should always be aware that the worst could happen and that it is good to make contingency plans for the worst-case scenario.

When I went to Redcar just before it closed, a good structure was already in place. There was a good local enterprise partnership, and there were good relationships between the local council, under the outstanding leadership of its chief executive, Amanda Skelton, and local businesses, with the involvement of Paul Booth, the excellent chair of the LEP. Sadly, the community had been through it all before and this was not new territory. Because the community had experienced the mothballing by Tata, it had been through a similar experience and was prepared for the worst. There was a lot of realism and reasonableness, notably from the union leaders. I pay tribute to them, as did the hon. Lady. When the dreadful moment came, they could put things together very quickly. I remember the first meeting of the taskforce, when the spirit of togetherness was obvious. They knew what they were doing; they just needed to get on with dealing with the money.

[Alex Cunningham]

The Minister clearly recognises the tremendous job that has been done on Teesside by so many people, including the local authorities. She will also be aware that yesterday’s announcement affects my neighbouring constituency of Hartlepool, where 100 jobs will be lost. Has she given any consideration to what will happen to those workers, particularly in relation to the excellent package that is available for SSI workers?

[Anna Soubry]

I am not aware of anything in particular in respect of the redundancies in Hartlepool, but if the hon. Gentleman and those in the neighbouring community want to put forward a case, I am always willing to listen.

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

First, this situation is unlike the mothballing scenario in 2010, when I was a union officer on site, because there was not a single hard redundancy in the 22-month period. Now, there is a liquidation scenario and we have seen many hard redundancies. Secondly, I have written to the Minister about extending the remit of the taskforce to encompass the whole Tees conurbation and to help other workers who lose their jobs, such as those at Caparo, Tata and Boulby in my constituency. Thirdly, this will happen again and again. We have seen it in Port Talbot, Trostre, Llanwern, Dalzell and Clydebridge. We need a national network of taskforces to see how steelworkers and other workers are being treated in different areas of the country. This cannot be dealt with in a devolved, fragmented way. It is a sectoral issue that encompasses the whole of the UK.

[Anna Soubry]

I do not have time to deal with all those points because I want to respond to the specific points that were made by the hon. Member for Redcar, but there are lessons to be learned. It behoves any community, in the event of serious job losses, to act quickly and pull it all together. Many communities do so and that was critical in Redcar.

I pay tribute to the hon. Members for Redcar and for Middlesbrough South and East Cleveland (Tom Blenkinsop), and other hon. Members, for the way in which they have worked with the taskforce. I have paid tribute to Amanda Skelton and Paul Booth for the way in which they formed the taskforce almost before the dreadful news came on that Friday. As the hon. Gentleman said, at least 2,000 people were immediately put into redundancy, with all the consequences that that has for the supply chain, and many hundreds of them had not been paid for a considerable period. One reason why the taskforce was successful was that there were already good relationships between business, the council, Members of Parliament and all the other people one would expect to be there.

As a Government, we quickly put forward a financial package. In effect, there was £60 million. There was a headline figure of £80 million, but just under £30 million of that was used for redundancies, so the money that could be put into helping people get back into work was in the region of £50 million. I want to put it on the record that there was a £2.4 million safety net fund and that £1.7 million was eventually made available for apprentices. It took a bit of a fight, but we got there. There was £3 million for retraining courses, £2.6 million for a flexible support fund, £750,000 for business start-ups, a jobs and skills fund of £16.5 million, and £16 million of support for firms in the supply chain and the wider Tees valley area. There were also redundancy payments.

The hon. Lady is right to say that there is often a big problem in Whitehall. We said to those people, “We trust you to work out where the money needs to go.” However, the situation was, frankly, maddening and infuriating, and I only found out about it after she sent me a text. I do things differently, Mr Deputy Speaker. I give people my mobile phone number and say, “You contact me. You text me”, and they do! In a way it should not be like that, but it is good—we can exchange numbers later in private, Mr Deputy Speaker. The reason I do that is because of the situation that we found at Redcar. We had a group of people in the taskforce whom we trusted, and I pay tribute to all of them. They are not paid to do that, and they have worked incredibly hard. Amanda Skelton is paid to be the chief executive of the council, but she has worked like an absolute trooper and well beyond the hours for which she is paid—astonishing!

We trusted those people to put together a package and to have the funds, but we then had to go through the most bizarre set of hoops and all the rest of it, because they had to show that the package was value for money. As I put it to my otherwise excellent civil servants, this is a chief executive of a unitary authority who, on a daily basis, deals with large amounts of money and a huge budget. She is more than capable of looking at value for money, because unfortunately she has had to make lots of cuts, to reorganise and so on. In other words, I cannot think of many people who are more qualified to decide where the money should go, and who also have the responsibility to safeguard what is taxpayers’ money, but instead a system had to be followed—and Governments, of whichever colour, are blighted by too many systems and processes. We say that we will trust people, but too often we do not. However, we cut through that system—the instruction I always give is, “Get on with it. Trust these people and give them the money so that they can get on with it.”

There is no better example of the determination of those people involved in the taskforce—and beyond in the community—to do the right thing by all those who were made redundant at Redcar than what happened with the apprentices. There were 51 apprentices at SSI, and those jobs finished on that Friday. Some of those youngsters were on three-year apprenticeships, and it had all gone. This is a lot of money to ordinary folk, but we were talking about £1.7 million. It was astonishing. People such as Paul Booth went out there and found a place for every single one of those 51 apprentices within a week. That speaks volumes about their abilities, and about the reaction from the community and businesses. We then had to get the money—bit of a nightmare—but we got it, and all 51 apprentices can continue their apprenticeships.

[Anna Turley]

The right hon. Lady is right about the apprentices, but there were a few weeks between them losing their jobs and being reappointed. One apprentice came to my surgery and told me that he had been to Jobcentre Plus. Despite having done two and a half years of his engineering apprenticeship, he was told that he should get a job in a bar. It comes back to the point I made earlier: there are issues with the DWP’s systems, and that is one of the main points that I wanted to raise.

[Anna Soubry]

Again, that is a good point extremely well made. Such things are not acceptable. Of course I pay full credit to Jobcentre Plus. I know that Ministers stand here and say, “The taskforce has gone whizzing in.” From my experience in Nottinghamshire, when Thoresby colliery closed down, the taskforce went in and it all sounded great, marvellous and wonderful. In a way, it was great and marvellous. A lot of people put a lot of effort in. What matters, however, is the advice that somebody then receives.

There was another problem that the hon. Lady will remember: people being told that they could not sign up to HGV courses. The workforce in our steelworks is almost exclusively highly skilled. It is absolutely obvious that somebody who has been working in a place like SSI at Redcar may well want to change, enhance or add to their skills by training to be an HGV driver. What did we discover? That they could not have any money to do that. The stuff of madness! After a text from the hon. Lady, we got that one sorted out.

We then had some problems in making sure that the money was delivered to the colleges. When, unfortunately, 800 jobs were going in Scunthorpe, we put £9 million in because we had learnt from the experience in Redcar. That was replicated when Labour Members came to see me about the situation in Rotherham. They made a very good argument for a package of support. One of the things the Skills Minister and I did—by way of text, if I may say so again, Mr Deputy Speaker; it got the job done—was to release the money literally within 24 hours. No disrespect to our great civil servants, but we cut all the corners and cut out all the nonsense. The Minister gave a direction and said, “Get that skills money sorted out, so they can have it in Rotherham,” and we did the same in Scunthorpe. That was because of the lessons we learned from our experience in Redcar. However, the hon. Lady is right that there is more we can learn.

I think there is some good news. Over 400 former SSI workers have not yet made any benefit claim to date. We do not know why. I am hoping it is because they have got jobs, not because they have dropped out of the system.

The hon. Lady is also right about data. We always have to have people’s permission before we can share data. Nearly 700 former SSI supply chain workers are no longer claiming benefit. We hope that the majority are either in full-time work or in training. Some 166 people were employed as a direct result of the first jobs fair, which was held, as she said, very quickly in October. Nearly 900 people attended the second jobs and skills fair at the end of November at the Riverside Stadium, where more than 700 immediate vacancies were on offer.

I want to pay tribute to the noble Lord Heseltine. I know he can often be a controversial figure, but he is an astonishing person. He has the ability to bring all the people and all the organisations together. He has vision and drive. It was my idea, if there is anybody to blame—although I do not think anybody should be blamed, because he has been absolutely the right person for this. He has gone up there, and he has a vision and is knitting things together. I hope that in a short period of time we will be in a position to announce more about the future of the works at SSI and what we can do there.

I want to put it on record that 2,000 rapid response sessions have now been delivered, 2,969 people have received advice and help from the support hub, and 5,200 calls were made to the Jobcentre Plus helpline.

[Anna Turley]

Tonight has been about the people, but the site is extremely important too. I hope Lord Heseltine will not make any announcements without discussing with local people what they would like to see from that site, which is so important to the local economy and for local jobs.

[Anna Soubry]

Absolutely. One of the great joys of Lord Heseltine is that he is able to work with people. He brings people together. As I say, he has the right connections and the right vision.

It is great to have had this debate. There are lessons to be learned. We have already learned some of them. However, the ideal position to be in is never to have to set up a taskforce or to give out these sums of money in the first place. We do not want to see the redundancies that we saw in Redcar.