Ceramics Industry
Debate between Gavin Williamson and Chris McDonald(3 weeks, 2 days ago)
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Chris McDonald
My hon. Friend put it exactly right. We need to take both capital and operating costs into account. Fundamentally, the issue comes down to a belief or view—or, in my case, looking at the economic evidence and corporate finance. Is it possible to decarbonise and reindustrialise? Yes, of course it is, and that is precisely what the Government want to do. No one in the industry is asking us to tear up climate policy—they are using the policy to invest, and have invested £100 billion since the general election on that basis.
Many people mentioned the supercharger scheme, which currently supports around 10% of the ceramics industry. Quite obviously, 10% is not 100%, but the recent uplift in the scheme to 90% compensation has benefited members. The British industrial competitiveness scheme will offer further support on advanced and technical ceramics from 2027, backdated to the current year. That will reduce electricity bills by up to £40 per megawatt hour.
Chris McDonald
I will continue, but I will address a point that the right hon. Gentleman raised. He focused on the parts of the sector that are unable to electrify, which I am also very concerned about. Larger brick kilns and some sanitaryware items, which my hon. Friend the Member for Lichfield spoke about in relation to his constituency, are difficult to electrify. The main decarbonisation options on the table are hydrogen, or biogas —that was not mentioned today but it could be a solution—but it is important that businesses remain competitive and able to raise capital until such a time as those occur.
I reassure the right hon. Member for Stone, Great Wyrley and Penkridge that I am focused on that issue. I am not pretending that processes that cannot be electrified can be, but the policy is to electrify first, where that can happen. However, I realise that I need to work with the brick sector and others. I am also concerned about capacity utilisation in the brick sector currently, which was mentioned by other hon. Members, because that situation, of course, makes everything much more difficult.
Many people talked about international trade. I presume that all hon. Members in the room are in favour of free trade on a level playing field basis; unfair trade was what was particularly referred to. That can be an issue of energy—overseas companies having access to energy from sources that we would not use in the UK, such as Russian gas—or, as we have heard about, some have inappropriate labour practices. When the Government decide to enter into a free trade scheme and liberalise tariffs we are always cognisant of the overall economic benefit to the country but, ultimately, we want free trade.
The shadow Minister, the hon. Member for West Worcestershire, asked about interaction with the Trade Remedies Authority, which is our means of correcting that. I am incredibly keen to continue to encourage the sector to engage with the Trade Remedies Authority. If there are any difficulties with that, I want to know about it.