UK Steel Industry

Christina Rees Excerpts

Monday 29th February 2016 Commons Chamber

[Christina Rees (Neath) (Lab)]

Steel and the steel industry are vital to Wales, particularly to south Wales and my constituency of Neath. The Tata steel plant in Port Talbot is in the neighbouring constituency of my hon. Friend the Member for Aberavon (Stephen Kinnock) and the Trostre plant is roughly half an hour away in the constituency of my hon. Friend the Member for Llanelli (Nia Griffith). Both Aberavon and Llanelli are places where hundreds of my constituents from Neath work every day.

The fact that, this year, 1,050 jobs have been lost in the UK steel industry, 750 of which are in Port Talbot, shows the Government’s complete lack of action in saving the UK steel industry. Time and again, the Government have been dragged to the House by the Opposition to answer urgent questions on their plans to save the steel industry, but all they have offered are warm words, which are of no help to an industry that is in desperate need of action.

Many options are available to the Government, including a large amount of readily available EU funding to shore up the industry. The Government could also take action against the large amount of Chinese steel being dumped on to UK markets.

[Jim Shannon (Strangford) (DUP)]

Does the hon. Lady agree that, although we must express real concern about the job losses and the impact on the UK economy, we must also express concern about the quality of the imports. For instance, when it comes to the defence industry, the plate that comes from China is not of the same quality. How can we leave our defence forces at such a disadvantage when it comes to our submarines and ships?

[Christina Rees]

The hon. Gentleman makes a very good point. Chinese steel is far inferior to UK steel.

The Government could also take action against the large amount of Chinese steel being dumped on to EU markets, yet, again and again, they have left all such options to the side. The statistics speak of the importance of the steel industry in Wales. There are more than 6,300 jobs in Wales, over 4,500 of which are in Port Talbot and Trostre. Of that 4,500, almost a quarter are filled by people who live in my constituency of Neath. At this time, my constituents still do not know who will lose their jobs. For many, the plants in Port Talbot and Trostre are a way of life and have been for generations. Not knowing whether they will have a job in a month or two is absolutely unbearable for them. I know personally of the community that has grown up around the plants. My father worked at the Abbey, which later became the Steel Company of Wales and then Tata. When I was a schoolchild, I played hockey for the steel company. It was the centre of the community; SCOW put food on our plates at home and contributed enormously to our social and sporting lives. The same sense of community applies today to the 4,500 workers and their families that still work at and depend on the plants. The threat of the closure of Trostre and Port Talbot is more than I can contemplate, given the devastating effect that it would have on communities.

The Minister insists that the Government are doing all they can to help the industry, but that requires action rather than the warm words that they are offering. There is so much that the Government can do, especially about the dumping of Chinese steel on the market. The prospective change in dumping calculation methodologies away from the analogue method towards local Chinese prices and costs could result in the direct loss of at least 310,000 jobs in EU industries already badly hit by dumped Chinese exports. That is in addition to the hundreds of thousands of indirect jobs that would be at stake. Surely, rather than the Chancellor moving ever closer to the Chinese, he should not grant market economy status to China until it fulfils all five EU technical criteria and not before a thorough EU-wide impact assessment, including a full public consultation.

It is important to tackle the dumping of steel because our current anti-dumping measures cannot counter the massive blow caused by Chinese steel import surges. Lifting the lesser duty rule would remove the cap on anti-dumping and anti-subsidy levels, simultaneously bringing the EU in line with everybody else, but the Government have chosen to be the main player in blocking those changes. Will the Minister assure the House that the Government are doing all they can, including reversing the decision to impose low-level duties on Chinese rebar and supporting the steel industry by supporting the lifting of the lesser duty rule? Even the former European CEO of Tata agrees. He has said that as long as trade defence protections are not introduced, the dumping of steel below its cost of production will continue.

The UK steel industry had 280,000 jobs in 1970, but now it has only 30,000. That is 250,000 jobs lost in less than 50 years. When will the Government wake up and pay attention? Will they pay attention before it is too late? EU options are also available to us. Why are the Government not moving forward and allowing the modernisation of EU trade defence instruments that would stop it taking a year and a half from complaint to definitive anti-dumping measures?

Many regions in the world are more effective at providing a level playing field for their industries and deploy trade defence tools faster and more effectively. As a consequence, dumped goods find their way on to the European market much more easily. The Government would prefer to argue with themselves over the issue of the EU than to use our membership of it to save the UK’s steel industry and the jobs of my constituents in Neath.

The president of the European Steel Association, Eurofer, has said that if we do not use the trade defence instruments available to us there is a substantial risk we will see more plant closures and job losses. Given the wide number of options available, why are the Government not standing up for UK steel in the EU and arguing for modernisation? Over and over again the Government have missed their chance to save the UK steel industry. The Minister for Small Business, Industry and Enterprise has told the House that the steel industry is vital for the UK, yet the Government are treating it with contempt and playing fast and loose with the livelihoods of the tens of thousands of workers in the industry.

The Welsh Government are doing all they can within their power to help the affected communities in Wales. They are working tirelessly to provide support to the industry, but, as the First Minister has said, the fundamental question facing steel production in Wales goes far beyond the devolved responsibilities of the Welsh Government. He has said that the UK Government must step up and play their part.