Tata Steel: Port Talbot

Jonathan Reynolds Excerpts

Monday 18th September 2023 Commons Chamber

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

After 13 years of failure, expectations of this Government are not high, but even by their standards, spending half a billion pounds to make thousands of British steelworkers redundant is a truly remarkable feat. Last week, I went to Port Talbot to meet some of the workers affected by this announcement, and like us, they support green steel. They have actually been campaigning for green steel for many years, and those workers were promised repeatedly that they would be a part of the process. They rightly feel betrayed by this announcement and the fact it is being done to them, rather than with them.

I know the Minister will come back to say that more jobs were at risk. I have heard the Government’s line that all the jobs would have gone entirely, but she must be honest: it is absurd even to countenance the UK being the first major economy not to have a domestic steel industry. The UK steel sector is already much diminished compared with when the Conservatives came to power. The transition to green steel should be about more jobs, not less. It should be an optimistic, exciting moment for steel communities, but instead this has caused anxiety and anguish. I say genuinely to Government Ministers and to all on the Conservative Benches that if they allow decarbonisation to become associated with Thatcher-style job losses, it will risk the legitimacy and political support for net zero in a way that courts disaster. Is levelling up not a tacit admission by the Conservative party that the scars of the 1980s deindustrialisation cut so deep that we still feel them today?

Why were the workforce not involved in this process? Why has only one technology—the electric arc furnace—been chosen? What consideration was given to hydrogen and carbon capture possibilities? We already know that this deal was not the company’s opening proposal, so what other options have been considered? Crucially, what will happen to downstream facilities, such as Trostre and Llanwern, that provide packaging and automotive steels that cannot currently be served by an electric arc furnace? Will that steel be supplied from India, with a larger emissions profile than at present, which is what many of the workforce believe?

What is included in this package as regards ongoing industrial energy costs? Crucially, when will a grid connection for an arc furnace be provided? In addition, how will this £500 million of taxpayers’ money be protected? In the absence of any clear and identifiable criteria, how do we know that it represents good value for money? Finally, what does this announcement mean for the rest of the UK steel industry and, in particular, Scunthorpe?

The plan that Labour put forward for green steel was industry-wide, comprehensive and transformative, and it was designed to secure major economic dividends for the UK. We cannot secure the future of UK steelmaking with sticking plasters. We cannot do it on a plant-by-plant basis, and we cannot do it without the workforce behind us. This should have been such a positive announcement. It should have been about creating jobs, strengthening national capabilities and showing that we can do decarbonisation in a way that works for working people. I say to every single steelworker out there that it is clear that they will only get the bright future that they know is out there when they get a Labour Government.

[Ms Ghani]

It is unfortunate that the hon. Member decided to politicise such an important sector. It was not me but Gareth Stace for UK Steel, the trade association for the UK steel industry—the voice of the country’s steel manufacturers—who said:

“This is a really important day for our steel sector in the UK, with the Government showing a real commitment to the future of steel making here in the UK. We will get a true transformation of our sector to create steel for the net-zero economy, something which our customers are asking us for. We have the ability to completely transform our sector and boost the net-zero economy in the UK. We can really seize the opportunity to increase production in the UK and increase exports. We all know that a net-zero economy will need more steel, not less.”

The hon. Member is putting on a very poor display over a serious decision that has been in discussion, I am told, for more than a decade. I have spoken to Ministers who have held the portfolio over many years before me, and they tell me that these matters are nothing new.

More importantly, the hon. Member knows that the blast furnaces were at the end of their life. The right decision is to provide certainty, security and continuity, and that is exactly what we are doing. The UK is a world leader in producing steel, but we need to decarbonise, and this is the best way of ensuring and guaranteeing jobs, of which there are 8,000 on the site and 12,000 in the supply chain.

As well as the £500 million, £100 million has been put together for a group to consult and work with the unions, the staff, the Welsh Government and the Secretary of State for Wales to ensure that the transition is as appropriate as it can be and not so challenging for the people who are impacted. The proposal is to go for electric because other energy sources are underdeveloped. If the hon. Member will reflect on what is happening in Europe on hydrogen, for example, he will see that nothing else can work at this scale and within the tight timeframe that we want to work in to ensure that the site continues to be viable not only for manufacturing steel in the UK and supporting all the jobs in the supply chain but to support Wales, too.

The proposal will also transform the Welsh community and the Welsh area. A huge amount of work is taking place with the freeport, and a huge number of businesses and jobs will be coming out of the transformation to green steel. It is unfortunate that the hon. Member cannot recognise that, without this decision, there would have been continued uncertainty, no security for the staff and definitely no security for the UK steel sector.