UK Steel Industry

Debate between Jim McMahon and Nicholas Dakin

Monday 29th February 2016 Commons Chamber

[Nic Dakin (Scunthorpe) (Lab)]

It is a pleasure to follow my hon. Friend the Member for Newport East (Jessica Morden), who speaks with great passion about the impact of the steel industry on her constituents. It is very much the same for my constituents, who are currently going through 900 job losses. Coming down here this morning, I found myself on the same train as Ian Smith and Paul McBean, the leaders of the Community union in Scunthorpe. I pay tribute to them for the work that they have done, alongside Martin Foster of Unite and, indeed, all the steelworkers and their families in Scunthorpe, in going through this very difficult time and leading the way forward. It is good that there are ongoing discussions with Greybull Capital about the future of the works. I commend everybody who is supporting those discussions, including those in Government. These are difficult times and we will face a very difficult future, whatever it is, so it is important that those discussions are successful.

I want to give a sort of half-term report on the Government’s progress so far on the industrial asks. The Minister, for whom I have a lot of regard, is fond of saying, “We have delivered, largely, on these asks”, but I think she will recognise, along with me, that it is a job started but still to be finished. First, on business rates, the Minister herself recognises that there has been little progress, but points us with a mischievous twinkle in her eye to the forthcoming Budget. I hope that twinkle bears dividends in the end and we see some movement on business rates.

Secondly, on energy costs, it has taken over three years for us to get delivery on the mitigation for the carbon floor tax, which the Government unilaterally applied. As my hon. Friend said, the money is still not in the coffers of the steel makers. On energy costs, I would appreciate it if the Government looked at the flawed EU emissions trading system proposal to see what can be done about it. It needs to be offset against indirect carbon costs, because otherwise it will do further damage to the UK steel industry through carbon leakage to other parts of the world and will fail to deliver what it is intended to do.

Thirdly, the Government are to be congratulated on bringing forward new procurement guidelines, but frankly, guidelines are not worth the paper they are written on unless they have an impact on how the Government and their contractor base deliver. There are a few tests we can apply. We can look at what is going on in defence; many Members have alluded to the issues there. I was pleased that a Defence Minister said today that there was a desire to push the guidelines down the procurement pipeline, but the Government need to push hard to make the difference that we need. I commend to them the work that Network Rail does, because we have there a pipeline of best practice that needs to be matched in other industries.

On renewables, DONG Energy has just got the contract for developing Hornsea Project One. However, the test will be whether UK taxpayers, through the very generous contract for difference deal, and UK energy bill payers, are financing the delivery of renewable wind farms built with UK steel or with other steel. The Government need to keep their eye on that, because it is a real test of their procurement rules.

The job has begun and it is, in theory, going in the right direction, but unless it has an impact it will be worth nothing. I know that the Minister wants to see impacts, so I will be interested to hear how she is going to ensure that the great expectation she has given us is delivered on.

[Jim McMahon (Oldham West and Royton) (Lab)]

This has been a fascinating debate. Members might ask why an MP from Oldham is present in a debate about steel—we do not have a steel industry to speak of—but I have seen the demise of manufacturing in my community. When we talk about numbers in this place, we have to relate them back to the families affected. Communities are destroyed when industry disappears. We have heard time and again about the interventions that could be made, and my hon. Friend has made a fantastic point about them, but does he have any faith in this Government to deliver on them?

[Nic Dakin]

It is the Government’s duty to deliver, and we have to work with them to make that happen. As my hon. Friend the Member for Wallasey (Ms Eagle) said right at the beginning of the debate, they have been dragged kicking and screaming towards delivery. We need them to deliver faster, because our communities, the steelworkers and their families do not have the time to wait. That is why the Government need to step up to the steel plate and deliver before it is too late.

The fourth issue is dumping by communist Chinese. If I had said 20 years ago that a Government would be in hock to communist China in undermining our manufacturing base, people would have said, “That’s what you’d expect from the Labour party,” but it is a Conservative Government who are doing it, which is remarkable—they are in hock to communist China. We need to take action on the lesser duty rule. The Secretary of State said that the Government can take action in other ways, but we need more details of how they will take action against Chinese dumping, to make sure that there is a fair and level playing field. Nobody wants benefits; all we are asking for, on behalf of our industries, is a fair playing field, and that is what acting on the lesser duty rule will achieve.

Many Members have spoken at great length about market economy status. During Foreign Office questions last week, I was pleased to hear the Foreign Secretary repeat the commitment that market economy status would be determined and seen through the prism of steel. I would be grateful if the Minister could confirm that unless China delivers on steel in the way that it should, it will not get market economy status.

In conclusion, my constituents are very keen on this debate and want the Government to do even more to deliver so that my constituents and my community can have good jobs and a good future.