Steel Industry: Contribution to the UK Economy

Jack Brereton Excerpts

Wednesday 25th January 2023 Westminster Hall

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

It is a pleasure to serve under your chairmanship, Mr Pritchard. I thank the hon. Member for Newport East (Jessica Morden) for securing the debate. I know from our work together on the APPG for steel and metal related industries that we agree on many things and have the interests of the steel industry jointly at heart. I also thank my hon. Friend the Minister for the level of focus that the steel industry is receiving at the moment. I am heartened by that and want to put my thanks on the record.

Steel is something that I never tire of mentioning in Parliament. My home town of Scunthorpe has one of the biggest steelworks in the country. I care about the local jobs because I understand the impact that it would have on our local community and on individuals and families were those jobs to be lost, but we can never say enough times the impact that it would also have on us as a nation and our position in the world were we ever to lose our ability to make our own steel.

Not only does the steelworks provide thousands of jobs that pay roughly 45% more than the average job in Yorkshire and Humberside, but its impact ripples throughout our entire local economy, supporting an ecosystem of businesses that sustain countless livelihoods. I have been told that it supports 20,000 jobs in our area, and I believe that to be the case. People who work in the steelworks in Scunthorpe are people I went to school with. They are people whose children went to school with my daughter. They are my neighbours. They are members of my family—my granddad made his living and raised his family through his work at the steelworks. It is a source of great pride to him and to many people in Scunthorpe and the surrounding area that the work our town has put in has helped to build this country.

We heard figures from the hon. Member for Newport East on the value of the output of steelmakers here in Britain, but it is almost impossible to truly quantify the impact that steel has throughout the wider economy and every sector and, just as importantly, the loss we would face were we not able to produce our own steel.

[Jack Brereton (Stoke-on-Trent South) (Con)]

I congratulate the hon. Member for Newport East (Jessica Morden) on securing this debate, which is very important for not just steel but ceramics. Refractory ceramics are vital for the steelmaking industry, and particularly energy-intensive industries such as steel and ceramics need additional support to transition and invest in energy efficiency measures. Does my hon. Friend agree that we need additional support from the Government that is easier to access so that these industries can invest in energy efficiency measures?

[Holly Mumby-Croft]

My hon. Friend is absolutely right. He and I have worked together on many of the issues that affect energy-intensive industries. Ceramics play a crucial role in the steel industry, lining the blast furnaces that we use to make steel and, of course, we like to have a cup of tea in a ceramic mug as well.

I cannot say enough times how important it is that we never, ever become the only country in the G20 that is not able to make its own steel. That would leave us at the mercy of steel producers around the world, who would be in full knowledge that we were not able to make our own steel, with the prices and challenges that would come with that. I hope the Minister agrees that steel truly is a vital strategic industry. Nobody can go a single day in their lives, from the moment they get up to the moment they go to bed, without needing to use steel.

A dependable supply of high-quality steel—that is a crucial point: in this country we make some of the finest steel money can buy anywhere in the world—will underpin our every endeavour as we tackle the problems of the 21st century and the issues that we grapple with in this place. It is vital for everything from growth to defence, and Russia’s invasion of Ukraine has served only to highlight the challenges and the importance of that. I truly believe that the public have a fantastic understanding of how important this is and instinctively know it is crucial that we are always able to make our own steel.

I have seen the support in recent years, including the £800 million of energy support and the two occasions when the Government took the brave step of extending the steel safeguards. That was a challenging time for us, so I congratulate the Government on doing that, because it was really important. Had we not done that, I am not sure we would be here now having this conversation—it was absolutely right. In Scunthorpe, we remember how the Government paid workers’ wages in 2019 and into early 2020 when the buy-out happened.

We have all seen the press reports about British Steel and Tata negotiating with the Government. I know that is a live negotiation and we cannot talk about it, but I will do everything I can, as I know other Members will, to help and assist all parties involved to reach a good outcome and secure the future of steelmaking in Scunthorpe. My own view is that, should a deal be reached, we must look at this as a pivotal moment. We must get a deal done and then the next day wake up and start straight away with the steps we need to take to allow steel to thrive into the future. We must immediately start discussions at pace about carbon border adjustments, so that we do not find ourselves falling behind the EU. We must look at the emissions trading scheme and the perverse incentive that it is possible to create whereby we can see loss-making production—carbon-producing production—incentivised by a scheme initially designed to prevent excess carbon production. We must also address all the issues relating to energy costs.

I urge the Government to go as far and as fast as they can on those issues, and to do everything they can to give the industry confidence that ours really is the Government that will put in place the measures that will secure the future of the steel industry. I believe they are, and I urge the Government to give the steel industry that confidence.