UK Steel Industry

Anna Turley Excerpts

Tuesday 12th April 2016 Commons Chamber

[Sajid Javid]

I thought I heard the hon. Gentleman say “up to £90 million”. What we have always said is “up to £80 million”, and that has not changed. I agree that there is a long way to go, but so far, in respect of Redcar, nearly 700 jobs have been created, safeguarded or supported, and only a quarter of the more than 2,000 workers at SSI were claiming jobseeker’s allowance at the end of February.

[Anna Turley (Redcar) (Lab/Co-op)]

I do not want to take up too much time, because I shall be speaking later, but the figure of 600 jobs relates to those who are in work or full-time training, not just those who are in work. That is important, because it is work that will be vital at the end of the training.

[Sajid Javid]

The hon. Lady has made a very important point: at the end of the day, it is about work. Training can lead to work, as can retraining, so it is important to invest in it. I know that, to the people of Redcar, this seems like a drop in the ocean. When a community is built around a single industry, the death of that industry takes away more than just the jobs. I do not want to see any other steelmaking community suffer the same fate, and that is why the Government have been taking real action to support the industry.

--- Later in debate ---

[Anna Turley (Redcar) (Lab/Co-op)]

Yesterday, the Secretary of State pledged his commitment to the steel industry, which I welcome, but I would like him to spell out exactly why his Government are now willing to consider co-investment with a potential buyer for Port Talbot, when they ruled out anything like that for Redcar—at the time because they said that state-aid rules prevented their supporting SSI, and after SSI was liquidated because they refused to put any British taxpayer money into the Thai banks that owned the site. Why were the Thai banks not suitable for co-investment? It could have bought us time for a sale or enabled the mothballing of the blast furnace. I would like the Government to give us a full explanation of that decision.

In the weeks prior to closure, SSI asked the Government for a loan to enable it to restructure and keep the plant going. It was refused. I sat down with Ministers and potential investors—a company willing to run the coke ovens and run, or at least mothball, the blast furnace while a buyer was found—who did not want a single penny of Government money, but the Minister said it could not be done. What has changed? Does she now regret not listening to the people of Teesside, the unions and the companies we presented to them in order to keep steelmaking alive on Teesside? The cost of hard closure has been far greater than that of intervention would have been. I want to say something about that cost in the time available.

First, on the local economic cost, 2,200 direct jobs were lost overnight at SSI and over 900 further jobs were lost in the immediate supply chain, from those who provided the parts and maintenance to the companies that provided the gas or loaded the slab at the ports to those who cleaned the overalls and fed the workforce. Plus, there is no way of measuring the knock-on impact on local shops, hairdressers, builders, nurses—as my hon. Friend the Member for Middlesbrough (Andy McDonald) mentioned—and childminders. We know they are all feeling the pain. Unemployment in my constituency has jumped by 16.2%. We now have the tenth-highest unemployment rate in the country. The steelworks were the foundation industry for many businesses large and small across Teesside. For 175 years, that industry powered the local economy, providing jobs and security for local people and a source of immense pride, as our steel built the cities of the world.

Secondly, I want to talk about the cost to the Exchequer and the state. It is currently understood that the Government are paying over £200,000 a week to maintain the site in its unrecoverable coma status. Recovery of the land for future use is expected to cost the state well over £1 billion. As for the British steel industry itself, we have lost Europe’s second-largest blast furnace and coke ovens, in which millions of pounds had been invested and which were in very good shape.

[Andy McDonald]

Does my hon. Friend agree that trying to land a bill of £1.1 billion on the Teesside communities for the remediation of the site is totally unacceptable? I know that the Minister is ignoring it, but it will be a huge issue for Teesside if it is landed with that bill.

[Anna Turley]

My hon. Friend is absolutely right. I want a further commitment from the Government that they will maintain their support for the site as it stands, meet that cost and enable local people, businesses and representatives to decide the future of the site and how it can contribute to our local economy.

We have lost our blast furnace and coke ovens, in which millions of pounds had been invested—expensive national assets belonging to the British steel industry now laid to waste. We can add to that a loss to the Exchequer of the tax intake from those 3,000 workers; the £50 million—and it is £50 million, not £80 million—paid for retraining; and the further £30 million for redundancies and other costs. We must bear it in mind that the majority of workers are still awaiting payment of their protective award, on which I would be grateful for an update from the Minister. Finally, there is the loss to Redcar and Cleveland Council, which has already suffered a £90 million loss after six years of Tory austerity, of £10 million a year in business rates from SSI alone.

Thirdly and most importantly, I want to speak about the human cost. Six hundred workers are back in work or full-time training, according to Department for Work and Pensions figures. I pay tribute to them, my taskforce colleagues and all those in the jobcentres and colleges who have worked hard to achieve that, but 600 of over 3,000 workers six months after closure still leaves us with a lot of work to do. What about the thousands of others? They are signing on, many for the first time in their lives, and many are approaching the six-month cut-off point for contribution-based jobseeker’s allowance. Those with a partner with an income of more than £114 a week will soon lose their JSA entirely.

People are moving out of homes, cars are being given up and many are reliant on hardship funds to pay the bills. One worker can no longer afford to keep his rented house to have his children stay overnight because of the bedroom tax. He is having to be rehoused in a one-bedroom place and cannot have his children to stay. The effect on family relationships has been huge. There has been a widespread loss of identity, comradeship and pride in a skilled trade. Redcar and Cleveland Mind has seen a 91% increase in mental health referrals in the last year, and is doing a fantastic job, but many of my constituents are under the radar. One has not even left the house since he lost his job last September. Families have been destroyed and lives shattered. Our town has been through a tragedy. The financial and human cost of inaction is far higher than that of intervention would have been. I say to the Government: you let us down last year, but please do not let down any other steel town in the UK.