UK Steel Strategy

Judith Cummins Excerpts

Thursday 19th March 2026 Commons Chamber

[The Secretary of State for Business and Trade (Peter Kyle)]

With permission, I will make a statement on the Government’s steel strategy. I begin by declaring my membership of Community and GMB trade unions.

Resilient economic growth is the main driver of social justice, and steel is essential to both. Steel underpins the key growth-driving sectors in our modern industrial strategy. It has strengthened and sustained communities in England, Scotland and Wales. The future of steel in Britain is about ensuring the future strength and security of our national economy.

We honour steel’s proud industrial past, but we do not live in it. We are ambitious and excited for Britain’s future steel sector. Steel is essential for advanced manufacturing, clean energy, construction, defence and digital technologies. Steel is vital for sustaining thousands of lives and livelihoods, with good jobs, apprenticeships and opportunities. Steel is central to communities in Port Talbot, Motherwell, Scunthorpe, Sheffield and Teesside.

This House will be acutely aware that Britain’s steel sector has experienced decades of decline, from the failures of Thatcherism that closed Consett and Ravenscraig and shrank Corby to the damage done by the Tories to Redcar and Port Talbot. Steel manufacturing in Britain serves as the starkest possible monument to the failure of Thatcherite monetarism and its record of industrial vandalism. By contrast, Labour has an activist industrial strategy that determinedly targets key industries, technologies and strategically important sectors for economic development, national security and resilience.

In the last five decades, steel industry employment in Britain has declined by 90%, from more than 300,000 jobs in 1970 to less than 30,000 today. We are closing that decades-long chapter of deliberate de-industrialisation and committing anew to strengthening and sustaining Britain as a steelmaking nation. High operating costs and global overcapacity have made it much harder for British steel companies to compete. Manufacturers have looked to cheap, imported steel to keep costs down. As a result, investment have tapered off, capabilities have reduced and communities have been let down. Crude steel production has declined by more than 50% in the last decade.

Faced with these challenges, previous Governments failed to present a long-term vision for steel in Britain. They were reactive, not proactive. They intervened to support specific companies at specific times, but failed to improve the general conditions for the industry as a whole. They lacked the necessary boldness, creativity and urgency. This Government will not make that same mistake. Far from believing that steel decline is inevitable, we embrace a future for British steel manufacturing as a staple of sustainable, resilient economic growth and our national security. While the industry still faces challenges today, we will do everything we can to help it adapt, grow and succeed into the future, and our actions on steel will be driven by what is best for our national interest.

Our steel strategy sets out a series of actions to reverse the failures of the past: to build a strong and resilient steel sector, backed up with £2.5 billion of Government investment. That is on top of the £500 million that we have pledged for the steelworks at Port Talbot. Our ambition is for domestic production to meet up to half of Britain’s domestic demand. To support that effort, we will introduce a new trade measure to replace the existing safeguard. From 1 July, overall quotas for imported steel will be reduced by 60% compared with the safeguard. All steel coming into the UK above those levels will be subject to a 50% tariff. This measure will apply to imported steel products that can be made in the UK.

This is not a decision that I have taken lightly. I have done so to shield Britain’s steel industry from the damaging effects of global overcapacity, to ensure that Britain’s steel industry contributes fully to our critical national infrastructure and our defence, and to shore up the UK’s resilience to global shocks. Without this action, the UK’s steelmaking capability faces real jeopardy, leaving us reliant on overseas suppliers. I will not let that happen. Steel is essential for our energy security, our transport infrastructure and our industrial strategy, and in this volatile geopolitical climate in which we find ourselves, that kind of dependence is weakness. Britain’s national interest requires the strength of British-made steel. The tariff will be implemented once import quotas have been fully met. I believe that is essential for the resilience of sectors reliant on steel imports, including the car industry, construction and defence. We will review the measure in 12 months to make sure that it is working effectively.

Our approach reflects months of engagement between my Department, the Steel Council, businesses and trade unions. I thank the trade unions that have helped us, officials in my Department who have poured their heart and soul into this strategy, and my ministerial team for their contributions and leadership. We continue to engage constructively with the EU to protect vital UK-EU steel trade given our highly interconnected supply chains. Beyond the trade measure, we are backing electric arc furnaces to shift to greener, decarbonised steel production. As we see at Sheffield Forgemasters, electric arc furnaces have the technical capability that we need to produce steel to the very highest of standards for nuclear, for aerospace and for defence. This is important, as traditional blast furnaces will eventually reach the end of their operational lives. [Interruption.]

[Madam Deputy Speaker (Judith Cummins)]

Order. I want to hear what the Secretary of State has to say. I am also certain that constituents want to hear him. This is a very important statement.

[Peter Kyle]

It is okay, Madam Deputy Speaker. It is just that everyone is shocked to see the hon. Member for Boston and Skegness (Richard Tice) in his place.

Electric arc furnaces are important as traditional blast furnaces will eventually reach the end of their operational lives and a managed transition is vital to maintaining supply. That is why we took control of British Steel last year, and we are currently working with the owner on the long-term future of the site.

The UK has the opportunity to lead in clean, green steel, and we are going to seize it with both hands. That is why we are also changing the clean industry bonus, making it easier for British steel to be included in British wind farms.

Britain can recycle more steel. Making better use of scrap steel is fundamental to the sector’s future growth. Millions of tonnes are ready to be recycled. We are building the technology to do it right here in Britain. We are creating a more competitive business environment for steel, too. We are tackling the high cost of energy. Our supercharger is delivering millions of pounds in savings for steelmaking firms. These businesses will benefit even further next month thanks to the changes that we are making to the network charging compensation scheme, which will increase the rate of relief from 60% to 90%. We are taking further action to support foundational industries by addressing high electricity costs, with a view to boosting supply-chain resilience. Our British industrial competitiveness scheme could reduce bills for other businesses in the sector by providing a discount of up to £40 per megawatt hour, starting from April 2027.

Private sector investment is essential for the steel sector. It is vital for driving up capacity and capability. That is why, within 10 weeks of taking office, we negotiated a substantially better deal to support the transition to green steelmaking at Port Talbot. We are welcoming investment from new entrants to the UK market. The National Wealth Fund is there to support them.

We will continue to work hand in hand with devolved Governments and steelmaking hubs in Wales and Scotland to bring in that additional investment. This is the vision that our steel strategy sets out: Government, with boldness, certainty, and urgency; industry, with energy, enterprise and expertise; and communities, stronger, safer, and more secure. All will be working together to make our steel sector attractive to new investors, innovators, employees and apprentices. It will be financially stable, internationally competitive and proudly British. Together, the strategy and the new trade measures will help to build a stronger, more resilient steel industry. They will take the immediate action that our steel industry needs and provide a plan to help the steel sector prosper for the long term.

Building a brighter future for Britain’s steel has already begun. Today, UK Export Finance has signed a landmark financing deal with Nigeria, which is refurbishing two major ports. As part of that agreement, British Steel Limited will supply 120,000 tonnes of steel billets for this work. That is a £70 million contract, the largest British Steel order that UKEF has ever backed, strengthening and sustaining Britain’s future as a steelmaking nation.

We need steel made in Britain in all its forms. We need it for the 1.5 million new homes that we are committed to build, for the third runway that we have approved at Heathrow that will require 400,000 tonnes of steel, and for our new data centres and gigafactories, such as the Agratas gigafactory in Somerset. A total of 23,000 tonnes of steel has already gone into its construction, all sourced from the UK.

Britain needs a steel industry for our national security, economic security and national interest. We need to ensure that Britain remains an internationally competitive steelmaking nation not just because our past was built on steel, but because our future depends on it. I commend this statement to the House.

[Madam Deputy Speaker (Judith Cummins)]

I call the shadow Minister.

--- Later in debate ---

[Peter Kyle]

My hon. Friend is right to explain that this strategy is a holistic strategy. It looks at the industry as a whole and considers how all the assets can be brought together and given a sustainable footing. I will invest, modernise and protect where necessary.

On the questions about the EU, I have, of course, been in discussion with my EU counterparts. I met four EU commissioners in the last month and the vice-president. Next week we will have further discussions when we are in Cameroon for the ministerial meetings of the World Trade Organisation. These are important times for both the European Union and the UK. Our reset is important, and that reset work will continue. It is in both our interests to make sure that we invest in, protect and modernise our respective steel industries, and we should be doing so with as much co-operation as possible.

[Madam Deputy Speaker]

I call the Liberal Democrat spokesperson.