EU Referendum: UK Steel Industry

John Healey Excerpts

Wednesday 13th July 2016 Westminster Hall

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

I beg to move,

That this House has considered the implications for the UK steel industry of the outcome of the EU referendum.

It is a pleasure to serve under your chairmanship, Mrs Gillan. A number of Welsh Members are here today and, especially as you were previously the Secretary of State for Wales, I know you will take a keen interest in this debate.

Many of us have debated this subject in Westminster Hall and in the main Chamber many times, and we have tabled many questions. I lose track of the number of times that my colleagues and I have faced the Minister, but the facts remain the same. The steel industry faces immense challenges. There is a bright future for the industry, its workforce, its products and its role in our economy, but only if the Government take decisive action to respond to the challenges that the industry faces, which is even more important in the aftermath of the EU referendum. I argued a few weeks before the referendum that a vote to leave the EU would be a body blow to the industry, and I am sorry to say that the information I have had from producers, from UK Steel, from the Community union and from many others involved in the industry is that all the referendum has resulted in is yet more uncertainty and challenges for an industry that already faces significant difficulties.

The crucial question that I want the Minister to answer today, and indeed that many of my colleagues will be addressing, is this: what will the Government do differently—not only from their approach before the referendum, but in light of that decision—to offset the additional uncertainties, risks and challenges now facing the industry?

[John Healey (Wentworth and Dearne) (Lab)]

I congratulate my hon. Friend on securing this debate. He poses a question about the additional uncertainty and the Government action that is required. Is he aware that, as part of the reaction to the uncertainty, south Yorkshire-based Speciality Steels will be sold, fast-tracked and separately, despite the pause on the sale of Tata’s main strip business? He will have seen Monday’s written statement from the Secretary of State for Business, Innovation and Skills, which made no mention of whether the Government are willing to help on financing, energy costs or research and development support. One of the things we require from the Minister today is surely a commitment that the Government will stand by the pledges they have made to support steelworkers, steel communities and the future of steelmaking, including in south Yorkshire at Rotherham and Stocksbridge.

[Mrs Cheryl Gillan (in the Chair)]

Order. Mr Healey, I remind you that interventions are supposed to be short.

--- Later in debate ---

[Anna Soubry]

I could not agree with the hon. Gentleman more. He is absolutely right, and he needs to know that the Steel Council has been working as if nothing has happened or changed ever since the referendum vote. Indeed, the UK Metals Council is meeting now—that is where I would have been had he not secured this debate. Everyone involved in the sector needs to understand that the work of the Government, Ministers and my officials has continued through this recent period and, without doubt, will continue through the summer. If I stay in my job, he can be assured that I will continue to do everything I can to work for the best interests of our steel industry; if I have a successor, that person will do exactly the same. The officials, of course, do not change. Furthermore, the determination will be as instilled in the new Prime Minister as it has been in our outgoing Prime Minister.

To deal quickly with procurement, we changed the rules, and we were the first member state of the EU to do that, commendably so. However, Opposition Members make a good point about the need now to ensure real evidence that those rules are working. We need good reporting, so that we can come back to say that we are absolutely certain that the new procurement rules are producing the results we want.

Network Rail sources 98% of its steel domestically, or 145,000 tonnes over the next five years, and there is no reason to believe that that will change. High Speed 2 will need 2 million tonnes of steel over the next 10 years —forgive me, Mrs Gillan, but I am a huge supporter of HS2 and I fear our friendship will be wobbling here. I assure you and all hon. Members that I will continue to do everything I can in Government to make the case for wonderful and important infrastructure projects to be brought forward as much as they can be, as it will be a great boost for our economy if we can do that.

I have spoken with steel makers since the referendum, although it was not the result they wanted. It was sad that 69.6% of people in Hartlepool voted out; 60% of people in Cardiff voted in, but in Sheffield, 51% voted out; in Rotherham, 67.9% voted out; even in Neath Port Talbot, 56.8% voted out; and in the constituency represented so ably by the hon. Member for Scunthorpe (Nic Dakin), nearly 70% voted out. We all have a big, big job to do—but we can talk about that on another occasion. Only last week, however, I met British Steel, and things are going well notwithstanding—I do not want to be overly confident, but it is on track to deliver its business plan.

I want to deal with the point made by the right hon. Member for Wentworth and Dearne (John Healey) and by the hon. Member for Rotherham (Sarah Champion). Yesterday, I had a good meeting to discuss—freely—the situation in Stocksbridge and Rotherham. The Secretary of State has written in response to the right hon. Gentleman’s letter, although that reply might not yet have been received. For his and the hon. Lady’s benefit, the Secretary of State wrote:

“To date, no such requests have been made by any of the potential bidders, but we would be willing to consider requests that are made in the future.”

We know that people will be interested in the speciality steels, and rightly so, because it is a cracking business, with huge potential. Hon. Members can be assured that if we get requests to enable those sales to support that side of the sector, we absolutely will do it.

[John Healey]

Will the Minister give way?

[Anna Soubry]

I will take one intervention, but quickly, or I shall be in big trouble.

[John Healey]

I thank the Minister for giving way and for her response. May I ask her to thank the Secretary of State for his response, and to let her successor, if there is one, and his successor, if there is one, know that we as South Yorkshire MPs will be holding the Government to that commitment?

[Anna Soubry]

I did not doubt that for one moment, and I thank him.

The situation with Tata and the potential deal with ThyssenKrupp has raised several issues, notably that of pensions, about which hon. Members rightly have concerns. I have to say that the Opposition spokesman—this is a matter for the Department for Work and Pensions—did not make the most supportive contribution, but more than 4,000 consultees have taken part in the Government consultation. It will take time to go through all that, but the Government have always said that we will do everything we can to support the production of steel in south Wales, which means ensuring that at least one of those blast furnaces remains open.

As ever, the clock is against me, but the usual rules apply, and I will reply by letter to any questions that have been asked but I have not been able to answer. I again congratulate the hon. Member for Cardiff South and Penarth on securing the debate, and I assure him that wherever I am in the Government I will certainly continue to fight for the British steel industry to be sustainable and to continue making steel. I want to ensure that the case is taken forward, so we have that sustainable steel industry.

The hon. Member for Hartlepool looks as if he wants some reassurance, and he can have it. I have been to Hartlepool—I have been to almost all the steel mills throughout Britain, and apparently I will get one of those “I-Spy” badges as a result, if I come to the end of my tenure. It will be a proud moment, and I will wear it with great pride. Hartlepool is another viable business and, again, we will be there when buyers come forward. If they need support or want to talk to Government, we will do everything we can. Notwithstanding the referendum result, let us put some confidence back and say that we will create—or, rather, maintain—a sustainable steel industry. I will do everything I can, wherever I might be, to support it.