UK Steel Sector: Supply Chains

Holly Mumby-Croft Excerpts

Wednesday 9th June 2021 Westminster Hall

[Holly Mumby-Croft (Scunthorpe) (Con)]

It is a pleasure to serve under your chairmanship today, Sir Graham. I thank the hon. Member for Aberavon (Stephen Kinnock) for securing this important debate. As I am a fellow steel MP, I agree with him on many of the issues that he has raised this morning.

The steel sector has seen tough times and this Government have been proactive. In Scunthorpe, we put in hundreds of millions of pounds to keep our blast furnaces going. I myself come from a steel family, so I know that when times get tough, it is not only the steelworks that are threatened but the steelworkers— people like my granddad, who worked in Scunthorpe steelworks for 30 years—and the 20,000 supply chain jobs in my area, as well as the towns that grow up around the industry.

Steel is, indeed, a foundation industry that is crucial to national security. Our ability to manufacture and produce steel is critical in ensuring that we are self-reliant and insulated from global steel shortages. The Minister will recognise that there is competition between Governments in providing the best environment for a steel industry to thrive and there is much that we can do to provide a better competitive environment for UK steelmakers.

Rather than continuing to provide support in times of crisis, as this Government have undoubtedly done, we need to continue to look further and harder at long-term steel measures. Indeed, the glaring flaw in the preliminary recommendation by the Trade Remedies Investigations Directorate is that it did not make a sufficient industry-led assessment. Our steelworks produce many products across the categories assessed by TRID. These products are linked back to the production of crude steel and steelworks need a certain base level of production to be profitable. An increase in imports in an unprotected category could affect the viability of another steel product, and there is a real risk that the UK will be increasingly vulnerable to imports if steel safeguards are removed. I urge the Minister to work with her colleagues from the Department for International Trade to prevent that from happening.

We must also address the high cost of energy prices. Our steelworks currently pay almost twice as much for energy as French and German steelworks. On steel procurement, there has been progress and many in the industry have welcomed the overarching principles of the Government’s recent paper. The central tenets, especially on considering the overall social value of procurement and providing more flexibility for decision making, are absolutely right. The procurement of steel from the UK generates social value for our communities. Steel does indeed create well-paid jobs and has a part to play in levelling up areas such as Scunthorpe as manufacturing and logistics powerhouses.

However, challenges remain and I hope that the Minister will consider them. Steel procurement often involves an internal supply chain process. A contracting authority for an airport, for example, may appoint different subcontractors for different parts of the project. Each subcontractor may then appoint a sub-subcontractor on smaller bits and the sub-subcontractor may in turn, given their much smaller brief, procure the steel they need for their section of the development from an overseas producer without a tender—for example, one they have an existing relationship with.

That means that the same steelmaker may have to pursue, through multiple channels, contracts that are ultimately for the same project. That also makes reporting of the origins of steel difficult, which flies in the face of another fantastic tenet of the Government’s procurement proposals, which is transparency. Most importantly, in our national projects, this situation could cost the taxpayer more, due to the fragmented supply chain, the administration, the bureaucracy, the increase in supply lead times and the margin that each level of the steel supply chain commands.

We will see whether the proposals go deep enough and I hope that the Minister will say how she will work with her colleagues in the Cabinet Office to ensure that sub-sub-subcontractors uphold the high standards that the Government are looking to set for contracting authorities.

I believe that the British people want to see the Government use British-made steel in large-scale Government projects such as HS2. They want to see every bit of steel that we have the capability to produce being produced here in the UK. Indeed, I hope the Minister will consider what she can do with the traditional supply chain to explore whether contracting authorities can make steel procurement a separate tender, so that our steelworks can bid for large parts of the steel required in a steel-intensive national project.

That not only fulfils the core tenets of the Government’s procurement proposals but makes commercial sense. Our steelworks are well equipped to deal with the different products needed and have dedicated supply teams to provide technical management and supply chain steel expertise. I hope that the Minister can explore this approach with her colleagues in the Cabinet Office.

I come from Scunthorpe. I was brought up so close to the steelworks that we could hear them making steel when we lay in bed at night. This matter is personal to me and to many of my constituents. The hon. Member for Aberavon is absolutely right—none of us could live a single day of our lives without steel. This Government have a proud record in supporting the steel industry in places such as Scunthorpe. I look forward to hearing from the Minister and working with her on behalf of our world-class steelmakers.

UK Steel Production: Greensill Capital

Holly Mumby-Croft Excerpts

Thursday 25th March 2021 Commons Chamber

[Holly Mumby-Croft (Scunthorpe) (Con) [V]]

I was really pleased to hear the Prime Minister speak yesterday about the opportunities he sees for British steelmakers in major projects such as HS2. Can my right hon. Friend provide more information on that and can he—I know it is difficult—reassure the Liberty Steel workers in Scunthorpe that the Government will do all they can to support them?

[Kwasi Kwarteng]

I would like to reassure my hon. Friend. My right hon. Friend the Prime Minister was absolutely right to say that we need a huge amount of steel—about 5 million tonnes—over the next decade and that this Government are committed to an ongoing steel industry. As she knows, I have spoken to local management and workforce representatives, and we are doing all we can to look at all options to make sure that this vital piece of infrastructure continues and remains a going concern.

Budget Resolutions and Economic Situation

Holly Mumby-Croft Excerpts

Tuesday 9th March 2021 Commons Chamber

[Holly Mumby-Croft (Scunthorpe) (Con) [V]]

In 2019, this Government were elected to deliver on their promises to level up towns like Scunthorpe. We could not have imagined then the challenges that would befall the country. As we move towards what we all hope will be better days ahead, alongside that recovery and support, it is still the job of this Government to keep the promises they made to towns like Scunthorpe, where local people put their faith in MPs like me, knowing that we have a shared stake in our town’s future.

That is why last week’s Budget was so important to Scunthorpe. It is one thing to tell local people that we will keep our promises and that we will invest, improve and truly level up places like Scunthorpe; it is another to show them. In addition to over £10 million of Government investment in our high street, I particularly welcome the Chancellor’s Budget announcement committing a further £21 million of proper new money to Scunthorpe via the towns fund. I worked on our bid with our excellent board and my hon. Friend the Member for Brigg and Goole (Andrew Percy). We were ambitious to bring forward projects that would benefit local people in both Scunthorpe and surrounding towns and villages—projects that would raise our whole area, not just the town centre.

In addition, the Budget announced the exciting approval of our bid for a new Humber freeport, which will make a huge difference to North Lincolnshire and the whole Humber region. Along with Members on both sides of the House, I have seen the potential benefits of freeports and supported the project, which will create jobs and investment. The freeport will include a customs site at British Steel—further evidence of the Government’s support for the industry.

This Budget also recognises the many businesses in Scunthorpe and the incredibly tough time that they have had over the last year. I want to thank those businesses in my constituency that have worked with me and taken the time to talk to me about their views and give me their insights, which we have been able to feed back to Government. In these tough times, the Budget will give those businesses more certainty and not only protect jobs but create new jobs in our area. The excellent kickstart scheme has already attracted interest from over 100 local employers.

With the towns fund, the investments we have seen over the last year and a freeport agreed, the Government have finally aligned the stars and recognised Scunthorpe for what it actually is: the ideal place for businesses to invest and grow, a great place to live and an area of our country with fantastic potential. I look forward to seeing those promises for Scunthorpe delivered.

UK Steel Industry

Holly Mumby-Croft Excerpts

Monday 14th September 2020 Commons Chamber

[Jessica Morden (Newport East) (Lab)]

I am grateful to have the opportunity tonight to talk about some of the challenges and the opportunities facing our steel sector, both as co-chair of the all-party parliamentary group on steel and metal related industries along with the hon. Member for Scunthorpe (Holly Mumby-Croft) and the secretary, my hon. Friend the Member for Aberavon (Stephen Kinnock), and on behalf of my constituents who work in Tata’s Llanwern site and Liberty Steel in Newport East.

I pay tribute to all those who work in the UK steel industry. They are a dedicated and highly skilled workforce, making world-class products.

[Holly Mumby-Croft (Scunthorpe) (Con)]

I am proud to have spent eight hours in our local steelworks in Scunthorpe in the recess. Choosing to do it on the hottest day of the year was perhaps not my finest move, but I agree with the hon. Member that our steelworkers are incredibly hard-working, dedicated people, and it is hot and difficult work. I hope that she will join me this evening in calling for the Minister to consider setting targets for the amount of UK steel used in public projects; for steel specifications to be published using UK norms; for the long overdue steel public procurement pipeline to be published consistently; to push for other Departments to sign the UK steel charter and for Government-linked projects such as HS2—

[Madam Deputy Speaker (Dame Rosie Winterton)]

Order. I suspect that there might be quite a few interventions in the debate. It is only half an hour, and it is the debate of the hon. Member for Newport East (Jessica Morden). I hope that any interventions will be short.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Nadhim Zahawi)]

I congratulate the hon. Member for Newport East (Jessica Morden) on securing this evening’s debate. She has been a passionate advocate for the UK steel industry, including in her role as co-chair of the all-party group on steel and metal-related industries. Clearly, this sector is important to the United Kingdom and testament to that is the number of colleagues who are present in the Chamber at 11 pm on a Monday night. One colleague who is unable to intervene or speak tonight is my hon. Friend the Member for Corby (Tom Pursglove). Although he cannot make his voice heard in this place, he certainly does on behalf of his constituents who work in the important steel industry in his constituency.

This debate represents a welcome opportunity to discuss the UK steel sector, which will continue to play a critical role as a foundation industry as we secure our economic recovery and long-term prosperity following the impact of the coronavirus. Madam Deputy Speaker, you will know that the steel sector provides well-paid, highly skilled jobs, as we have just heard from the hon. Lady. It also plays a key role in critical UK supply chains across many important parts of the UK economy, including automotive construction, power generation and, of course, defence.

Earlier this year, we welcomed the acquisition of British Steel by Jingye following a period of insolvency.

[Holly Mumby-Croft]

Will my hon. Friend give way?

[Nadhim Zahawi]

Very briefly, because I have a lot to get through tonight.

[Holly Mumby-Croft]

I just want to say that the constituents in Scunthorpe regularly mention to me the support that they receive from the Government. Does my hon. Friend agree that support for other steel plants such as Celsa is vital?

[Nadhim Zahawi]

It certainly is and I hope that I can cover that in the time that I have left to me.

Both officials and Ministers invested considerable time and effort in closing the deal with Jingye and the planned £1.2 billion investment that will go into the operations of British Steel. I hope the hon. Lady agrees that this represents a huge vote of confidence in the UK steel industry and the high-quality steel produced here in the United Kingdom. Notwithstanding this positive outcome for British Steel prior to the pandemic, the global steel industry was already facing significant headwinds. This included demand slowing across developed economies and persistent global excess production capacity, which depresses prices and harms the profitability of UK steel producers.

In the past few days, Tata Steel has published its accounts, which show a challenging position across its UK and European operations. While it is not appropriate for Ministers to comment on the performance of individual companies, I wish to reassure the hon. Lady that we continue to work very closely with the entire UK steel sector and the trade unions, and that we understand the challenges facing the industry in the UK.

While the coronavirus has come at a challenging time for the industry, we have been working intensively over this period to ensure that the UK steel industry has been able to access the support that it needs since the start of the covid-19 pandemic The Government have set out a far-reaching package of support to protect jobs, incomes and businesses across every part of the economy. Those working in the steel industry have been among the 9.6 million individuals across the country who have been able to access the job retention scheme. The scheme has protected people’s livelihoods in the industry and ensured that steel manufacturers have been able to retain high-skilled staff while managing the impact of reduced demand caused by the pandemic.

Importantly, we have worked closely with the steel industry representatives over this period to ensure that the furlough scheme—the job retention scheme—was sufficiently flexible to accommodate some of the real key asks from the industry and from the unions to meet the changing requirements of the industry as the wider situation evolved. I have been engaging personally on a regular basis with companies, trade associations, and, of course, the trade unions to gather their feedback. Direct input from the steel sector has helped to shape a number of our covid-19 support schemes. The coronavirus large business loan interruption scheme, the tax deferrals and the trade credit reinsurance scheme, which we launched with £10 billion, clearly came through as a result of that particular engagement with the industry. They were developed rapidly in response to that particular challenge faced by companies in the industry.

In addition to those far-reaching economy-wide schemes, we have committed to consider bespoke support on a last-resort basis where a viable company of strategic importance has exhausted all other options available to it. The House will be aware—the hon. Member for Newport East mentioned it—that such circumstances apply to Celsa Steel, which is a critical supplier to our construction industry. Government support in that case secured over 1,000 jobs, including 800 positions at the company’s principal site in south Wales. Commercial confidentiality prevents me from setting out further details on that case, or indeed from commenting on any discussions we have had with individual steel companies over this period. However, I hope that hon. Members agree that that is a clear signal from the Government of our continued commitment to the UK steel industry and the 30,000 individuals who are employed in the sector.

Oral Answers to Questions

Holly Mumby-Croft Excerpts

Tuesday 16th June 2020 Commons Chamber

[Nadhim Zahawi]

The hon. Member mentions the aerospace sector, into which the Government have put around £6.5 billion between the Bank of England corporate finance scheme and UK Export Finance, with an additional half a billion pounds of support. We have also put £3.4 billion into the growth deal across the northern powerhouse, with almost £380 million of that going to the north-east local enterprise partnership area, including his constituency of Wansbeck, which is benefiting from that to the tune of around £2.25 million in a science, technology, engineering and maths building at Northumberland College’s Ashington campus. A lot of work is going into this unprecedented package, but we continue to review all our interventions to make sure that UK workers get the benefit of a dynamic recovery.

[Holly Mumby-Croft (Scunthorpe) (Con)]

What progress his Department has made on undertaking a review of the Post Office IT system.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

On 10 June, the Government announced an independent review to consider whether the Post Office has learned the necessary lessons from the Horizon trial judgments and to provide an independent and external assessment of its work to rebuild its relationship with its postmasters. We are keen to see the review launch as soon as possible, and we are in the process of identifying a chair to lead the work of the review in order to get the answers that we need and to hear those voices.

[Holly Mumby-Croft]

I welcome that answer and the Government’s commitment to the review. Is the Minister aware of any support for postmasters and postmistresses while the situation is ongoing?

[Paul Scully]

The December 2019 settlement comprised a comprehensive settlement of £57.75 million. The Post Office has opened a historical shortfall scheme for postmasters who were not part of the group litigation and who want shortfall issues recorded in Horizon to be investigated and addressed. Many convicted claimants are going through a further process with the Criminal Cases Review Commission, with 47 referred to the Court of Appeal. Where convictions are overturned, processes are in place for them to receive compensation if appropriate.

British Steel Industry

Holly Mumby-Croft Excerpts

Tuesday 10th March 2020 Westminster Hall

[Holly Mumby-Croft (Scunthorpe) (Con)]

It is a pleasure to serve under your chairmanship, Sir Charles. I add my thanks to the hon. Member for Aberavon (Stephen Kinnock) for securing this debate.

It has been a huge pleasure, during the early weeks of my time in this place, to work with Opposition Members on steel-related issues. It is clear that all who are involved care deeply for the workers in their constituencies and across the country, and for the steel industry. We have had excellent news in Scunthorpe this week, with the buy-out of British Steel by Jingye Group. We are conscious of the fact that there have, sadly, been job losses, and our thoughts are with all who are affected.

I echo the comments made by my hon. Friend the Member for Bridgend (Dr Wallis), who spoke incredibly eloquently and mentioned the Scunthorpe deal. I will not repeat the excellent points he made. I put on record my thanks to the Government for the support they have shown to British Steel since last May. Without that support, frankly, we would not have a steel plant in Scunthorpe; it is as simple as that.

It has been a pleasure to begin to work together with colleagues who are here today. We need to be clear that not one person in this country could go a single day without steel. The industry is incredibly important for our nation, and I look forward to increased support from the Government.