Draft Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024
Greg Smith Excerpts(1 day, 10 hours ago)
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Greg Smith (Mid Buckinghamshire) (Con)
It is a pleasure to serve under your chairmanship, Mr Mundell.
As the Minister said, this draft statutory instrument was largely consulted on and prepared by the previous Conservative Government, so clearly the Opposition will not divide the Committee this afternoon. I congratulate the Department for Business and Trade, however, on managing to update the explanatory memorandum, unlike a Department for Transport statutory instrument that I responded to the other week, which still listed Guy Opperman, a Minister in the previous Government, as having signed off the declaration.
The measures in the draft Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024 build on legislation passed under the previous Government. The memorandum that accompanies this statutory instrument directly references historical concerns about fire and rehire tactics, which—I put it to the Committee—the last Conservative Government addressed through the establishment of a statutory code of practice. I gently suggest to the Minister that that should be reflected in the Bill that comes to Committee next week.
In government, we were clear with employers that they must not use threats of dismissal to pressurise employees into accepting new terms, and that they should have honest and open-minded discussions with their employees and representatives. In accordance with the code of practice, businesses must consult with employees in a fair and transparent way when proposing changes to their employment terms.
The Conservatives took the initiative to uphold and secure employment rights. Meanwhile, the Government—this is where some contention sneaks in—seem content with their disastrous national insurance jobs tax on employers and employees, the latter shouldering 76% of the cost according to the Office for Budget Responsibility, and to see businesses struggle and in many cases risk failure all together. There cannot be employee protections without employees in the first place.
Oral Answers to Questions
Greg Smith Excerpts(3 weeks ago)
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Sarah Jones
The right hon. Gentleman makes a really good point, and I would be happy to have a proper conversation with him about it. Marine renewables are a huge opportunity for us. We can build the supply chains across the country and, of course, Scotland is uniquely placed to take advantage of that. I would love to have a conversation about it.
Greg Smith (Mid Buckinghamshire) (Con)
When it comes to an industrial strategy, in the Labour Government’s first few months they have effectively shut down UK virgin steelmaking capacity, with no commitments to primary steel in yesterday’s Budget of broken promises. Unlike the United States and the European Union, the Government have failed to protect our car manufacturers against Chinese state aid. They have massively increased the costs to the very drivers of industry—real businesses—of employing people. Should the Government not call it their deindustrialisation strategy?
Sarah Jones
The challenge we have is that we have inherited the worst living standards growth during a Parliament in modern history. We have inherited huge challenges that we have to overcome, but we are looking to the long-term with our industrial strategy—[Interruption.]
Sarah Jones
I do not know whether the hon. Member for Mid Buckinghamshire (Greg Smith) has been paying attention, but we are developing a steel strategy, which the previous Government failed to do, with £2.5 billion of funding. We put a boost of £2 billion into our car industry only yesterday in the Budget, alongside £1 billion for the automotive sector and money for life sciences. We are developing an industrial strategy for the long term for the first time and we will not follow the Conservative party, which let our industries suffer and get to the crisis point that we are now having to deal with.
Greg Smith
The Minister mentions the car industry. Yesterday, after the Budget of broken promises, talking about the industrial strategy, Mike Hawes of the Society of Motor Manufacturers and Traders said:
“Delivering that strategy depends on the UK being globally competitive. Additional National Insurance Contributions will put massive pressure on the automotive supply chain which is predominantly SMEs.”
He described the lack of substantive measures to support the new car market as “hugely disappointing”, concluding that,
“the cost will soon be felt in reduced UK investment, economic growth and jobs.”
With such dire warnings so early on, is this not more evidence that Labour just does not get business and that its industrial strategy is in tatters before it has even begun?
Sarah Jones
For a Government who do not get business, it is surprising, is it not, that we got £63 billion of investment through the international investment summit—twice what the previous Government managed after two years of planning it? The Government are working very closely with the automotive industry. We know that the global situation is very difficult and I talk to Mike Hawes very often, which is why we put £2 billion of funding into the Budget yesterday. It is also why we are working very closely with the sector to create the conditions we need to transition to electric vehicles and to protect our industry in a way that the previous Government, frankly, failed to do.
Steel Industry
Greg Smith Excerpts(1 month ago)
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Greg Smith (Mid Buckinghamshire) (Con)
It is a pleasure to serve under your chairmanship, Mrs Harris.
I thank and congratulate the hon. Member for Boston and Skegness (Richard Tice) for securing this debate in Westminster Hall this morning. I also thank everyone who has contributed to it, particularly the hon. Member for East Londonderry (Mr Campbell), whose intervention will potentially go down in history as one of the most innovative ways to participate in a debate on steel, and my hon. Friend the Member for Brigg and Immingham (Martin Vickers) for his superb contribution.
Just a few weeks ago, I challenged the Minister in the main Chamber on the Government’s approach, not just to Port Talbot but to the UK’s entire steel industry, yet just a couple of weeks later we are on the cusp of Scunthorpe steelworks potentially closing completely by Christmas, despite the owner’s clear ask to the Government to safeguard what amounts to thousands of jobs and a vital component of our economic security. If we let Scunthorpe close, on top of Port Talbot, we risk becoming dependent on cheap imports, particularly from China.
Although I understand that the Chancellor and the Prime Minister have had some issues understanding their own manifesto commitments of late, surely the Government cannot possibly have dropped their clear commitment to steel in their manifesto. Surely not, given that 90% of Network Rail steel is sourced from Scunthorpe, and that Liberty and British Steel support more than 3,500 highly-skilled jobs there—those people are dependent on the commitment that the now party of government made in their manifesto. I understand that the Government’s talks with the owners have already stalled and broken down—not the best start for the Secretary of State and the Minister. I remind hon. Members that, less than a year ago, when in opposition, the Secretary of State said that the drive for green steel must mean more jobs, not fewer, but the reality on the ground today is fewer jobs in steel in our country.
The Minister knows that Scunthorpe is now the only site in the UK with the ability to produce virgin steel. If she allows it to close on her watch, we will be left open and vulnerable to cheap imports from China, and that must not be allowed to happen. Equally, I understand that the Government are not prepared to support virgin steel manufacturing while new electric arc furnaces are being commissioned and are coming online. Is that correct? If so, how does it chime with the Secretary of State’s previous commitment that decarbonisation must not mean deindustrialisation?
With the import of coking coal due to end this month, and the possible closure of the Scunthorpe plant completely by Christmas, resulting in thousands of job losses, time is running out. The Government simply must get a grip of the situation. The loss of that vital industrial and economic asset will result in 5,000 job losses across the supply chain and the end to steel production for the first time since the start of the industrial revolution.
Given the choice in front of them, the Government must take responsibility not just for Scunthorpe but for the downstream impact on our shipbuilding industry, the defence sector and, as the hon. Member for Boston and Skegness said eloquently, the production of the wind turbines that, on the other hand, the Government are encouraging—in fact, one of their first acts was to end the ban on onshore wind. They cannot have it both ways: if they want to have their cake and eat it, they need to support the steel sector. The Government have already let Harland & Wolff down. Will they do the same with the whole of the steel sector?
The Government’s plan seems to be to divert imports of steel from China through Brazil to give the impression that this is somehow an innovative solution. I am afraid there is nothing innovative about this Labour Government’s approach. They are masking their failure to secure a future for our steelworkers and our economy as a whole, and at the same time they are risking our national security in the face of growing threats from, among others, China.
Jessica Morden
The shadow Minister talked about taking responsibility, but will he take responsibility for the fact that for 14 years we had no industrial strategy, no steel strategy and endless steel Ministers? Labour Members begged to have any kind of strategy for steel. Therefore, the situation that this Government inherited just a few months ago is the responsibility of the previous Government.
Greg Smith
I am grateful to the hon. Lady for her intervention, but as my hon. Friend the Member for Brigg and Immingham set out, the last Conservative Government took many concrete steps to support our steel sector. I gently remind Members on the Government side—there is no sugarcoating this for Members on my side—they won the election. They are responsible now and have to take decisions for the future of steel; it is no good constantly coming back and trying to do the political point scoring that we have seen time and again in the Chamber. The other side is in charge now, so they can make the decisions. If this Minister wants to stand at the Dispatch Box in a few moments and make those commitments to virgin steel, to steel production in this country, to Scunthorpe and Port Talbot, that will be welcomed by both sides of the House, because both sides of the House want the future of steel to be secured in this country.
What we are seeing on the ground right now is something different, however, because we have returned to the Labour party playbook: scrap jobs, scrap production and become reliant on higher-polluting countries for imports. That is not what I call decarbonisation, so I ask the Minister to come clean. What has gone wrong so early in this Government’s tenure? Why are she and the Secretary of State unable to fulfil their manifesto commitments? Can the Minister explain what will happen to those thousands of jobs in the steel sector across our country? We need the steel strategy now, not a promise of it for the future. Time is running out.
Sarah Jones
I thank the hon. Gentleman for his intervention and for reading out a message from somebody watching the debate. We all agree that it is time for action and that is exactly what the Government seek.
I will expand on our plans. The steel strategy will be developed and delivered in partnership with the steel sector and the trade unions, of course. It will work in lockstep with the Government’s industrial strategy. Our intention is to increase our UK capabilities, so that we can create a more vibrant, competitive steel sector. That will turn around the situation we inherited, where— I want to emphasise this—under-investment had resulted in dated infrastructure.
My hon. Friend the Member for Stockton North (Chris McDonald), who knows so much about the steel industry, made the point about the efficiency and economy of the new technologies, and why blast furnaces have struggled to make money for the businesses that own them in this country. British Steel’s blast furnaces were built in 1938 and 1954. Both the blast furnaces at Port Talbot were built in the 1950s. They have become incredibly unproductive because they have not been invested in. The new technologies are simply more productive. If we do not keep up with what the rest of the world is doing, we simply will not be able to compete in the market.
We inherited an industry on the brink. Nevertheless, within 10 weeks of coming into Government, we negotiated a better deal with Tata with better safeguards for workers and more money invested in their future. Our £2.5-billion fund for steel will ensure that we have a steel industry for the future. The Government’s ambition is to ramp up investment, strengthen our supply chains and create more well-paid jobs in the places they are needed.
We talk of primary steel. With the help of experts, we will review the viability of technologies for the production of primary steel, including direct reduced iron.
Greg Smith
The Minister just said that she will review the options. I hope this is a binary yes/no question: is there a ministerial direction in the upcoming steel strategy to include a commitment to virgin steel production in the United Kingdom?
Sarah Jones
I think I was fairly clear. We have been in opposition. We want to produce primary steel in this country; the previous Government got us to a point where that is almost impossible without huge investment. We are supplying £2.5 billion of investment and looking, quite rightly, at the best way to spend that to create a viable steel future for this country. We are looking at direct reduced iron as part of our steel strategy, which the previous Government did not do.
The UK’s ambition is to ramp up investment. Many hon. Members talked of the need to procure British steel in this country, and we are now in a situation where 95% of the steel procured by the UK Government for infrastructure is British, if the necessary type of steel is made in the UK. The issue is that we do not produce all the different and right types of steel, so we need to ensure that we use the Procurement Act 2023 as much as we can to drive economic growth in steel.
I disagree with the hon. Member for Boston and Skegness on whether the green agenda can drive up jobs—we think that it can. For example, the Korean company SeAH is building a factory in Teesside that will build monopiles, which are the big structures that go into the ocean and anchor wind turbines. It is currently building that structure with 30,000 tonnes of steel from British Steel. We want to get to a point where we are not only building those kinds of factories in this country but using British steel where we can to make the infrastructure.
At the moment, we do not have a factory that makes turbines on the scale that we need for floating offshore wind, but SeAH is building that factory because it has an agreement with RWE, which will be running the turbines that it builds in future. That green job development into wind and renewable energy is driving our ability to build a factory in Teesside to create hundreds of jobs to build those monopiles, and we are using British steel. That is the kind of future that we want to see through the steel strategy; we are looking at those opportunities to bring new steel companies into this country and to find ways to drive up production in this country.
I should address the issues holding us back, as they were mentioned in the debate. China and excess capacity is a huge issue that we should not underplay. China is now the biggest steel producer in the world and its unfair subsidies have led to massive steel over-production, which fuels global overcapacity and drives down prices. That is a global issue with local consequences that makes profitable steel production here in the UK much harder. That key global situation is helping to shape our future steel strategy and we will need to tackle that problem through things like the carbon border adjustment mechanism—CBAM—and ensure that we are working with a level playing field.
Energy prices were mentioned by many Members, and for too long British energy-intensive industries, including the steel sector, have been held back by high electricity costs. Again, I disagree with the hon. Member for Boston and Skegness: electricity prices are set by global gas prices and the problem is our dependence on fossil fuels, as well as the fact that we did not mitigate for that situation in this country at all. When all the prices shot up with the war in Ukraine, we were in a worse position than many countries around the world.
The British industry supercharger that the previous Government developed, which the hon. Member for Brigg and Immingham (Martin Vickers) mentioned, will bring down electricity costs for the UK’s most energy intensive industries, but we know that we need to go further. It brings down only 60% of costs and there is still a disparity. We believe that, in an unstable world, cheap home-grown green energy is the future. That is what will drive down prices, reduce our exposure to the volatile fossil fuel market, protect bill payers and strengthen our energy independence. Fundamentally, that is what will bring down costs in the long term.
Members also mentioned the challenges of decarbonisation. Tata and British Steel’s plans to invest in electric arc furnaces are driven by market conditions and the desire to reduce their carbon footprint—customers want greener steel. The UK is going to have a CBAM. If we were producing steel in the UK with blast furnaces, we would be massively inhibited because the EU is bringing in a CBAM, so the cost of exporting to the EU would be much higher. We have to deal with the world as we find it, which again is where we disagree with the hon. Member for Boston and Skegness. We cannot look back and try to re-create the past; we have to deal with the world as we find it, which means that we have to move towards those more efficient and greener energies.
The EU, where 78% of our steel exports went in 2023—that is worth pointing out—will bring in its carbon border adjustment mechanism in 2027. We rely on exporting a lot of the steel we produce to the EU, and we would be at a massive disadvantage were we to carry on producing steel from blast furnaces. We have committed to a UK carbon border adjustment mechanism, which will give UK businesses the confidence that, when they invest in decarbonisation and electrification, they will not be at a disadvantage. That is important.
On other issues mentioned by hon. Members, I should touch on Scunthorpe, because that is at the forefront of everyone’s mind. No one wants to see any job losses, and everyone wants to see the steel industry thrive. Through our strategy, that is what we want to do. For commercially confidential reasons, which I am sure hon. Members understand, I cannot talk about our conversations with the owners, but I reassure Members that we are having conversations all the time and that we are working unbelievably hard to get a solution for Scunthorpe and to give the certainty that the hon. Member for Brigg and Immingham talked about. I completely understand the issue with the instability of the current situation, but all I can say to him is that we are doing all we can to work with the company on what the future will be.
Port Talbot Transition Project
Greg Smith Excerpts(2 months, 1 week ago)
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Greg Smith (Mid Buckinghamshire) (Con)
I thank the Secretary of State for giving me advance sight of his statement. I wish I could say that I am surprised by any of its content, but the media and the press have, of course, been relentlessly briefed on it over the last couple of days.
It is also no surprise that, once again, Labour is presiding over the demise of our steel sector. Output fell by 47% under the last Labour Government, and 56% of jobs were lost. Today’s deal means that 100% of output will go at Port Talbot. An electric arc furnace will take five years at best to get up and running; some suggest that it will be eight to nine years before a single new job is created, if we see any new jobs at all. As the statement says, this is a transition, but it is a heartbreaking transition for thousands of people—a transition from being in work to being out of work. In his discussions with Tata, why did the Secretary of State not take steps to ensure that the blast furnace will not be closed before the new electric arc furnace opens? Is this not the New Labour playbook—scrap jobs, scrap production and become reliant on higher-polluting countries for imports? That is not what I call decarbonisation. I must say, I feel a little sorry for the Secretary of State, who has been dispatched here to announce these spending decisions just a day after Labour’s day of shame on winter fuel cuts for pensioners.
In government, the Conservatives provided a grant of £500 million towards the £1.25 billion invested by Tata Steel, one of the largest support packages in the government’s history. At the time of the last Government’s announcement, that support was expected to save at least 5,000 jobs in the company. We worked with the Welsh Government and Tata Steel to establish a dedicated transition board to support affected employees and the local economy, backed by £100 million in total. Will the Secretary of State provide an update on any of those job projections?
Today’s announcement is notable for the absence of any reassurance or plans for the thousands of steelworkers in Scunthorpe who may not have jobs by Christmas. Equally notable is the Government’s failure, once again, to provide any detail on the domestic production of virgin steel. The Secretary of State says that we will have a steel strategy in the spring, but thousands of jobs, along with production capacity, have been scrapped today.
It was no surprise that last week, during the urgent question on steel, four times, the Minister for Industry failed to commit to safeguarding the future of virgin steel production in this country. I am sure that the Secretary of State does not need reminding that if he allows the Scunthorpe works to close, too, we will be the only G7 country unable to produce virgin steel. That leaves us open and vulnerable to cheap foreign imports, particularly from China. To his credit, he has always argued against offshoring our steel industry. He conceded once that it would be a “fundamental political mistake”. What conversations has he had with the Secretaries of State for Transport and for Defence about the impact of the Government’s new steel policy on our national security and ability to deliver infrastructure? Will he assure the House that he is doing everything in his power to ensure that we do not lose virgin steel manufacturing in the United Kingdom?
For the benefit of new colleagues, the Government, when in opposition, were committed to £28 billion a year of borrowing to fund their decarbonisation plans—a price tag that has magically disappeared, although the target has not. The Secretary of State made promises about that to the steel industry, but where are those promises now? Where is that money? Is he still battling the Chancellor? We know that Labour’s unions are quite successful in squeezing money from the Treasury, so maybe he can send them to stand up to the Chancellor if he is having problems.
The Government have our support in ensuring that the future of steelmaking in this country is sustainable. That goes beyond Tata and South Wales. Only in Labour’s world can the word “improved” mean fewer jobs and higher-polluting imports. When he returns to the Dispatch Box, I hope the Secretary of State will do better for UK steelmaking.
Jonathan Reynolds
I have been a Member of Parliament for 14 years, in which I have seen some interesting political events, but I do not think I have ever heard a contribution with such brass neck. That is quite something, because there is quite a menu to choose from.
Let me explain what I was doing during polling week, in the lead up to 4 July. Parliament was not sitting, and I was shadow Secretary of State. I was going between key seats, as would be expected, negotiating with unions, Tata, my colleagues in the Welsh Government and every relevant body to prevent action that would have resulted in the entire closure of the Port Talbot works on polling day. It was as though the Government had already gone; they were not on the pitch. The first thing I had to do, before I even became Secretary of State, was ensure that there was something there to save, because it would have gone under the Conservative party. [Interruption.] Conservative Members really need to listen, because my contributions are factually accurate, and I will help them to understand the real situation.
The point of the new investment is to save jobs. There will be better terms for the people who are unable to get the new jobs, including better cushioning during their retraining for entry into the rest of the economy. I have explained why it is a better deal, as I hope the shadow Minister has seen. He mentioned media reports; they have not come from my Department, but I appreciate that there were lots of interested parties. The unions and the Welsh Labour Government recognise that this is a better deal. I hope that the Conservative party recognises, on taking a step back from the statement, why the deal will make such a difference.
The shadow Minister mentioned virgin steel. Let me talk about my frustration about that. He will understand that the two blast furnace sites, Scunthorpe and Port Talbot, lose a great deal of money every day. The managers are so fed up with the lack of action under the last Government that they have put timescales on their closure. The simple truth is that I do not have the timeframe that was available to the Conservative party. Moreover, when it comes to Scunthorpe, I do not yet have the carbon capture infrastructure in place that will be necessary for the ideal solution. I would love to be a position to look at the hybrid solution that the shadow Minister put forward—keeping the blast furnaces open while we bring the electric arc furnaces online—but all the time that could have been used to work on that was during the Conservative Government, and they did not do that work. There are therefore far fewer options available to us, and the situation is far more challenging.
Since I became Secretary of State, I have had many meetings with the UK management about Scunthorpe, and have had three meetings, I believe, with Mr Li, the principal shareholder. I also met him when I was shadow Secretary of State. We have been clear that we want a transition in Scunthorpe, and want to put up Government money alongside what the company may offer, but that has to be part of a transition to the future. The workforce and the route that is offered to them has to be part of that.
Even if we are successful in doing that, my frustration is that the options available are very difficult for the area. The solution I would ideally deliver, which could have been delivered by the Conservatives in those 14 long years, is not available. When Conservative Members leave the Chamber today, I hope they reflect on the mistakes they made, their lack of action, the legacy they bequeathed us and, fundamentally, the improvements we have been able to make in such a short time.
Oral Answers to Questions
Greg Smith Excerpts(2 months, 2 weeks ago)
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Greg Smith (Mid Buckinghamshire) (Con)
What we have this morning is another chapter in the growing theme of what the Government said before the election and what they are doing after the election being entirely different things. The Chancellor of the Exchequer talked in May about reliance on Chinese EVs undercutting British workers and leaving us exposed, but by July she was talking about the benefits of trade with China. What we have seen in this Chamber this morning is that, while the rest of the world—the United States, Canada, the European Union—is acting on Chinese dominance in the EV market, the United Kingdom Government continue to dither. What is it to be: clear action on behalf of the UK automotive sector, or continued dither and failing to make a decision?
Sarah Jones
I do not know whether the hon. Gentleman is aware that until recently his party was in government, and inward investment from China grew over four times since 2014, so I will take no lessons from him on these issues. The automotive industry, which I work with closely and meet regularly, has not asked for what he suggested—
UK Steel Manufacturing
Greg Smith Excerpts(2 months, 2 weeks ago)
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Greg Smith (Mid Buckinghamshire) (Con)
Thank you, Madam Deputy Speaker.
“British steel is integral to growth and prosperity”.
Those are not my words, but the words of the now Prime Minister less than a year ago.
“The drive for green steel must mean more jobs, not fewer.”
Again, those are not my words, but those of the now Secretary of State less than a year ago. During the election campaign, he said:
“We cannot…lose the ability to make primary steel.”
But now we see, quite clearly, that Labour’s plans for decarbonisation do in fact mean de-industrialisation, and that the drive for green steel will mean fewer jobs, not more. Under the last Labour Government output fell by 47%, and, similarly, the promises that this Government made just weeks ago to steelworkers in Scunthorpe, Port Talbot and Teesside, and across the country, have been broken.
For weeks the Government have allowed rumour and speculation about the future of British Steel to run rife, while thousands of workers question whether they will have jobs by Christmas. Contrary to what the Minister has said, when we were in government we worked to deliver a more sustainable, long-term future for the steel industry across the United Kingdom, including Wales, through our £500 million commitment to building an electric arc furnace in Port Talbot. Now we risk being the only G7 economy without the ability to produce virgin steel.
I ask the Minister the following questions. Has British Steel indicated to the Government that it will halt its import of coking coal later this year? If so, when did the Government become aware of that? Are they committed to seeing electric arc furnaces in Scunthorpe? What discussions has she had with the owners of British Steel about the possibility that it will switch to foreign imports from China to fulfil its supply chain obligations here in the United Kingdom? What meetings has she had with stakeholders, including Ben Houchen and the Welsh Government, regarding the impact of future announcements on other steelworks across the United Kingdom, including on primary steel production? Communities and supply chains across the United Kingdom need certainty from this Government.
Sarah Jones
It is hard to know where to begin in responding to that. The previous Government allowed steel to run down. The previous Government did not believe in an industrial strategy. The previous Government did not believe in boosting our supply chains. The previous Government did not understand the importance of the steel industry to our national security and the communities we serve across the country. This Government do understand the importance of steel: that is why we are committing £2.5 billion from the national wealth fund, on top of the £500 million set aside for Port Talbot, and we will develop a strategy that enables the steel industry to grow.
The shadow Minister knows that I cannot comment on commercial and confidential conversations that we are having. I can reassure him, however, that we are talking regularly with British Steel, that we are talking regularly with Tata, that we are in deep negotiations with them, that we are talking with the local community, that we are involved with the trade unions—something that the previous Government did not believe in but suddenly seem to think important—and that we will get the best deal for workers and for the steel industry.
It is a shame that we were not in government five years ago, because we are where we are with some of these conversations. The way the previous Government approached industry was to wait for things to get so dire that they had to spend millions of pounds of public money trying to booster something, whereas our approach is to build the industry up and put the right levers in place, and we will see success that way.