Steel Industry

Debate between Natascha Engel and Adrian Bailey

Wednesday 28th October 2015 Commons Chamber

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

I was elected to the House in a by-election in November 2000. Within a week, I became vice-chair of the all-party cast metals group, and subsequently the cast metals and steel group. Since then, I have campaigned with Members from all parties in the House and Governments of different political persuasions on the issues surrounding the steel industry. I resent some of the Secretary of State’s opening remarks, which implied that there was political partisanship. I know that across all the parties of this House there has been a unified approach on issues surrounding the steel industry, and never before has that been more necessary.

I have Caparo headquartered in my constituency together with several of the constituent companies. It employs 1,700 people in the black country—800 in the immediate locality of my constituency—and manufactures a range of products from girders, barriers, portal frames and forged components to heavy rolled bar, sheet and profiles. When Caparo went into administration on Monday 19 October it did not just affect the jobs at that company; a comprehensive network of small businesses that were dependent on Caparo looked with great trepidation to their future. It is part of a complex supply chain in the midlands and many companies and employees within those companies are affected by it. With a huge range of products—computers, white goods, transport, cars, aeronautics, iPads and so on—the chances are that at least one of their components has been made by the highly specialised small producers in the black country. What is worrying is that those companies could not have anticipated the closure of Caparo, and the threat to them is even greater because they have not had the chance to diversify, as happened when MG Rover collapsed 15 or so years ago.

I commend the work of the West Midlands Economic Forum and of the Midlands Steel Taskforce, which the hon. Member for Halesowen and Rowley Regis (James Morris) referred to. It is making recommendations to deal with this problem and I shall highlight some of those which I feel are absolutely vital. The first action needed is to set up a transition fund, as was set up under the Labour Government when Rover went, to deal with the immediate impact on the small businesses that are tied in with Caparo. I understand that one issue is that PricewaterhouseCoopers is demanding payment within 15 days; 60 days is the norm in the industry. That could potentially cause enormous cash-flow problems to a whole range of small businesses, which they need help to resolve.

The second action needed is on skills. We have almost a unique blend of manufacturing skills in the area. We will lose not only the contribution to the economy, but the contribution that those skills could make in the future. We need help to ensure that people, particularly young people, have comparable jobs to sustain their skills. We need help with specialised imports; many products cannot be imported from China. The quality of goods locally must be sustained, and there will need to be some sort of financial support in order to keep that capacity there for the future.

[Madam Deputy Speaker (Natascha Engel)]

Before I call the next speaker, I am going to drop the time limit down to three minutes. That way, we will be sure to get everybody in.