Steel Industry (Nationalisation) Bill

Debate between Chris McDonald and Richard Tice

Committee of the whole House
Monday 8th June 2026 Commons Chamber

[Chris McDonald]

I am pleased that the hon. Gentleman has raised that question, because it was mentioned by a number of Members during the debate. To go back to the point about having a business environment that creates a profitable and investable steel industry, energy is clearly part of that. Some of the changes that the Government have already made—increasing the rebate on the supercharger from 60% to 90%, or the British industrial competitiveness scheme, which will support some of the downstream industry—will be particularly helpful in supporting not only the steel industry but other parts of heavy industry between now and 2030, which is when the Government’s clean power mission will come fully online. We anticipate that at that point, we will have not only clean energy, but secure and lower-cost energy.

If we consider the timescale of some of the investments in steel companies that we are talking about—not only multiple-year investments in order to commission, but multiple-decade investments beyond that—we can see that we have a pathway on energy that will enable us to get from now to 2030 and beyond. The Father of the House, the right hon. Member for Gainsborough (Sir Edward Leigh), who is not currently in his place, was concerned about this issue as well. He was also concerned that the UK has the highest energy prices in Europe, but we do not currently, and it is certainly our plan to ensure that our energy prices for industry are competitive with Europe in future.

Returning to the amendments that have been tabled, there was quite a lot of discussion about the sunset clause in the Bill. There were a number of objections to it, but the case for its continuation was made extremely well by my hon. Friend the Member for Middlesbrough South and East Cleveland (Luke Myer). As it stands today, the Government have no intention of extending the sunset period, but we recognise that we are living through particularly volatile times. There is geopolitical and economic uncertainty, which is likely to have a bearing on the steel sector in ways that it is difficult for us to see at the moment. As such, our view is that it is simply pragmatic to include this level of flexibility in the Bill, and of course, regulations made under that clause would be subject to the affirmative procedure.

It is important that I address some of the concerns of the hon. Member for Caerfyrddin (Ann Davies), who spoke with great passion and commitment about the importance of the steel industry throughout the whole of Wales. There is often considerable discussion of Port Talbot in this House, but as she rightly set out, there are also steelworks in Llanwern, Cardiff, Newport, Trostre and Shotton—I hope I have remembered all of them—that deserve recognition and investment.

I could not disagree more, however, that this Government have treated the Welsh steel industry unfairly, or not in an equitable way, compared with the steel industry elsewhere in the UK. The steel industry in Wales is the only part of the industry that has a ringfenced fund—£500 million for Port Talbot. The hon. Lady said that that has been spent with no benefit to the local community, but I frankly cannot agree with that. That £500 million has enabled Port Talbot to invest an additional £500 million in a transformation of that steelworks that will secure steel production at that site and the future of the south Wales steel industry for decades to come. It is a significant investment in the local community.

I know that the hon. Lady, like me, would have preferred for that transition in south Wales to have happened without the hard stop between the closure of the blast furnaces and the restart of the electric arc furnace, and I support Tata Steel’s view on the installation of its electric arc furnace. However, the decision to close was taken before the general election, and my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds)—the former Secretary of State, who is now Chief Whip—was able to intervene at that point and get a much better deal for the workers at Port Talbot and the community there than the previous Government did. I share the hon. Lady’s frustration and concern, but we need to be clear about where the indifference to the blast furnace closures in Port Talbot was. It was not with this Government; it was with the then Conservative Government.

[Richard Tice]

As we are talking about the new electric arc furnace in Port Talbot, can the Minister guarantee with certainty his confidence that, when built, it will open?

[Chris McDonald]

I am really glad that the hon. Gentleman has asked me that question—I know he has great experience in the property industry, and certainly with construction projects. As I mentioned earlier in the debate and as he will know very well, in any construction project you only really have certainty on the timeline when you have got out of the ground, and this project is still very much in the ground.

The hon. Gentleman’s question gives me the opportunity to clear up some issues. I know that the delay as reported by Tata Steel—this is Tata Steel’s project, not the Government’s—related to an electrical connection, and specifically the soil condition as it relates to building a substation. At the outset, quite rightly, assumptions were made about the soil condition based on engineering assessments. Right hon. and hon. Members must be aware, though, that there have been steelmaking activities on that site in Port Talbot for well over 100 years. Not all of those operations had been fully documented, and the ground conditions were considerably worse than had been anticipated. That is now being dealt with, and as soon as the project gets out of the ground, we will have great certainty about when the electric arc furnace can turn on. Until that happens, as a project manager, I would hesitate to give a cast-iron guarantee, because you need to get out of the ground first.

What I am looking forward to, though, is the delivery of the electric arc furnace in Port Talbot, because that is the point when the project will feel real—when the workforce will be able to see the furnace itself. I have been around the shop and seen the space that has been created for the installation of the furnace, but once it arrives on the dock of Port Talbot, we will all feel a greater degree of certainty about that. That will be a big boost to the workforce when it does happen. I am absolutely confident that it will happen, but to say when—to pin it down to an individual week or month—is more difficult.

There was one more point I wanted to make about the contribution of the hon. Member for Caerfyrddin. She essentially called for public ownership of Port Talbot, and I am really sorry, but that is another point on which we disagree.

The Government’s view is that where a steel undertaking is running adequately under private ownership, that ultimately should be allowed to continue, because the Government believe in private involvement in the steel sector. It goes back to the point about investment that I think the shadow Minister made earlier. She described her concern about a potential chilling effect on investment.

ExxonMobil: Mossmorran

Debate between Chris McDonald and Richard Tice

Tuesday 18th November 2025 Commons Chamber

[Chris McDonald]

I know that my hon. Friend is particularly concerned about the ceramics sector, but his comments could read across to other energy-intensive sectors. I said that once quality costs have been taken into account, UK gas prices are competitive with the rest of Europe, but in the sector that he mentions, many of those imports come from Turkey. In some other sectors in the chemicals industry, the issue is about over-capacity, over-supply and the dumping of products in the UK that have been produced in the far east—there are quite a number of issues, and I continue to work on all of them across the heavy industry sector to ensure that we can improve the business environment as a whole.

[Richard Tice (Boston and Skegness) (Reform)]

Another week, hundreds more jobs slaughtered on the altar of net stupid zero. It is leading to high energy costs, high policy costs and high taxes, and making this business—along with so many others—completely unviable. How many hundreds of thousands of other industrial workers are terrified that they are next? Can the Minister confirm to this House whether any discussions have been had with ExxonMobil, or whether any indications or concerns have raised by that company, about any other plants, businesses or refineries in the United Kingdom?

[Chris McDonald]

I know that the hon. Member takes a keen interest in the carbon prices for industry, and it is worth looking at the particular situation of this plant, as it exports all of its products to the EU. It receives a carbon allowance for its emissions that is slightly higher than 50%, and the reason why it does not receive a higher level of allowance is that it reflects the inefficiency of the plant. Fundamentally, the free allowances are set against a benchmark—a plant that receives 50% is one that is inefficient.

As I know the hon. Member will appreciate, given his business background, the intention behind that policy is to incentivise the owner of the plant to invest in order to reduce their carbon emissions, and then they would be able to sell the carbon credits on the open market and generate further profit for the plant. That has worked very effectively in the advanced manufacturing sector. For whatever reason, the owner of this plant chose not to invest, and it has suffered the carbon penalty as a result. The community of Fife has suffered as a result of its decision as well, and we are now in a position where a $1 billion investment cannot be sustained.

As I mentioned earlier, this company is exporting its products. It would be very difficult for it to find any way to exempt itself from carbon policies, because of course the EU has a carbon mechanism too, and that is the market into which it sells. Fundamentally, that carbon cost has to be paid, either here in the UK or to the EU. I am sure that as a good supporter of the UK and of Britain, as opposed to the EU, the hon. Member would prefer that His Majesty’s Treasury receive any taxation income, rather than sending that money to the EU.

Oral Answers to Questions

Debate between Chris McDonald and Richard Tice

Tuesday 14th October 2025 Commons Chamber

[Chris McDonald]

My hon. Friend raises an important point about the scope of the supercharger, which we are going to look at in 2026. He will be aware that some parts of the ceramics supply chain can access the supercharger, but I too am concerned about the impacts of high energy costs on the ceramics sector. I will meet the head of Ceramics UK this month, I am chairing a meeting of the Energy Intensive Users Group, and I look forward to further engagement with the sector in the new year.

[Richard Tice (Boston and Skegness) (Reform)]

I welcome the Minister to his place. Talking about industry, the Lindsey oil refinery in Lincolnshire is in receivership and is currently being sold, but thousands and thousands of jobs are at risk and the workers there are desperately concerned that the Department for Energy Security and Net Zero and the official receiver are not running a proper process, frustrating potential bidders for the whole site. Will the Minister, in his new job, commit to helping ensure that the whole site is sold to a successful bidder?

[Chris McDonald]

The hon. Member said that thousands and thousands of jobs are at risk in this country; they are at risk from the climate-denying policies of Reform. The Institution of Chemical Engineers reported last week that there are 800,000 jobs in the green economy in this country—thousands and thousands in the constituencies of every single Member in this House—and the hon. Member’s party is putting that investment at risk.

Steel Industry (Special Measures) Bill

Debate between Chris McDonald and Richard Tice

2nd reading
Saturday 12th April 2025 Commons Chamber

[Chris McDonald]

I am sorry, but I am not going to give way, simply because of the lack of time.

It is important to correct the record on a number of earlier comments. The hon. Member for Boston and Skegness (Richard Tice) and others referred to the coal from the west Cumbria mine, but I must inform the House that the management of British Steel has ruled that coal out on the grounds of quality. The sulphur levels are too high.

[Richard Tice]

rose—

[Chris McDonald]

I would be quite happy to talk to the hon. Gentleman about steel desulphurisation in the Tea Room later, if he would care to join me. I also completely refute his comment about bringing in global expertise—we have the expertise in the UK to run steel companies effectively. Again, I would be happy to introduce him to people who could do that, if he wishes to know.

It is important to remember that the steel market globally is not a free market, which is why Governments work together. The US Government use tariffs and blocked a merger between Nippon Steel and U.S. Steel. The French Government traditionally use procurement; the German Government subside their steel industry with energy prices; the Chinese Government give cash. It is really important to recognise that steel companies do not compete in a free market, and that if we ask our steel companies to do that, we are asking them to compete with national Governments overseas and letting those national Governments set our steel and industrial policies, and, fundamentally, our defence policy. I think that is unacceptable. We need to recognise that the corporate interest of a company is not the same as the national interest of the UK. The Secretary of State has recognised that and shown real leadership.

I want to reserve my last remarks for the steelworkers in Scunthorpe. I worked in Scunthorpe for a time, both at the ironworks and at the steelworks. To the steelworkers in Scunthorpe, I say: I know exactly the pain that you are going through. I am sure that they will be relieved by the words of the Secretary of State.

We all think fondly of the four blast furnaces in Scunthorpe—the four queens: Bessie, Vicky, Mary and Annie—but ultimately, I think we all recognise that their time has come. While they will be nursed into their ultimate retirement, we look forward to regenerating the steel industry in Scunthorpe and around the UK with the most modern, most efficient and most high-productive steel plants. Just as a past Labour Government did when they nationalised the steel industry for the second time in 1967—it was so good we nationalised it twice—this time, we can hopefully work with the industry to create a world-leading steel industry for the future.