Sector Deal for Steel

Neil Gray Excerpts

Tuesday 19th December 2017 Westminster Hall

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to speak on behalf of the Scottish National party in this debate. It is also a pleasure to see you in the Chair, Sir Henry, and to follow the hon. Member for West Bromwich West (Mr Bailey), who made a very good speech.

I congratulate the hon. Member for Aberavon (Stephen Kinnock) on securing the debate via the Backbench Business Committee and on his speech. He has been determined for quite some time to see a sector deal for steel; his advocacy on behalf of the steel industry is to be noted and congratulated, and he continued that campaign with his usual fervour today. I hope that his efforts have brought the issue back to the attention of the media, and that we will get some answers from the Minister about what the Government will do for the industry.

The hon. Gentleman asked the Government to address matters such as steel dumping by Chinese, Russian and Turkish producers. He also spoke about procurement opportunities. However, I must correct one aspect of his speech, because what he said about the new Forth crossing, the Queensferry crossing, was not quite right. Of the £540 million of orders, 45% came from Scottish companies, and steel from the Dalzell plant is in the girders at either end of the bridge. Sadly, no bidder came forward from Scotland for the main contract, because the capacity to produce the required level of steel has been lost since Thatcher closed the Ravenscraig plant. Of course, we want to do more; we want that capacity to increase, which is why we are all here today. The hon. Gentleman also discussed energy issues, which I will address later in my speech.

The hon. Member for Middlesbrough South and East Cleveland (Mr Clarke) made a very good speech. He was absolutely right to say that with the right opportunities and support, we can increase the GVA of the steel industry from £1.2 billion to £3 billion. We need to get this right. He also said, rightly, that the steel industry is an enabler for other sectors to grow. His speech was constructive but probing, and I hope the Minister was listening.

The hon. Member for Newport East (Jessica Morden) mentioned the importance of steel to other industries and Liberty’s exciting low-carbon proposals on green steel, which should reduce the need for imports and cut the industry’s carbon footprint. The hon. Member for Scunthorpe (Nic Dakin) was absolutely right to pay tribute to Tom Blenkinsop, the former Member for Middlesbrough South and East Cleveland. In all the debates I have attended, the hon. Member for Scunthorpe has been a stout defender of the industry, and he was very good again today. He was also right to pay tribute to the workforce, who have been incredibly resilient, particularly in recent years.

The hon. Member for Rotherham (Sarah Champion) rightly raised the potential Brexit challenges that the sector faces. We are particularly concerned about the impact on the industry of leaving the single market. It is essential that we see UK Government action now. As I said, the hon. Member for West Bromwich West made a very good speech; he focused on the needs of the foundries in his area and highlighted the supply chain that the steel industry feeds, including the £72 billion motor industry.

As the Minister will be aware, Liberty Steel operates at the Dalzell works in the constituency of my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows), which adjoins mine, and many of my constituents are employed there. It would be remiss of me not to pay tribute to the efforts of the Scottish Government, the trade unions and the Scottish steel taskforce, which secured the future of the Dalzell and Clydebridge plants, the former Tata sites in Scotland. The SNP is clear that we would welcome a sector deal for the steel industry: we encourage the UK Government to get it done and we note with concern its absence from the industrial strategy. I have been in contact with Liberty’s management about developments and about the priorities that they and others have for future intervention and support from the UK Government.

Let me be clear. The steel industry is not some “nice to have” aspect of the manufacturing sector. It is crucial to all aspects of infrastructure projects in these isles: it supports huge numbers of jobs and feeds a supply chain that contributes even more to employment and economic prosperity. Further support for the sector could open significantly more opportunities for employment and growth, as the hon. Member for Middlesbrough South and East Cleveland said.

What support could this Government offer? It has been well trailed by all hon. Members in this debate that help with energy prices would address the clear disparity with competitors in other countries, including France and Germany—a disparity that is estimated to cost UK steel producers an additional £43 million a year. The UK Government could look at helping to attract additional investment to the UK in a number of ways, such as by providing access to commercially competitive loans, a capital investment grant or innovative tax breaks or discounts linked to investment. They could also consider the proposal to establish a new innovation fund to boost research and development of steel products.

The executive chair of Liberty House, Sanjeev Gupta, said that he was “very impressed” with the efforts of the Scottish Government and the Scottish steel taskforce to save and support the industry in Scotland. It is now time for the UK Government to match the ambitions of the Government up the road and get on with the sector deal, delivering tangible support on energy, procurement and all the other asks from industry and from hon. Members across the House today. Let us hope that we will hear of such action from the Minister today.