Tata Steel: Port Talbot

Debate between Nusrat Ghani and Alun Cairns

Monday 18th September 2023 Commons Chamber

[Ms Ghani]

The hon. Gentleman, who worked with me incredibly well as chair of the all-party parliamentary group for steel and metal related industries, answers his own question when he speaks about hydrogen. He knows very well the age of the blast furnaces in his constituency and the fact that we needed a transition that enabled certainty to continue. There is no option other than electric to scale up within the time required. [Interruption.] My right hon. Friend the Member for Wokingham (John Redwood) knows that. We have spoken about this many times, so it is disappointing to see the hon. Member for Aberavon being so political about it now. The electric option was a commercial decision for Tata, but it was the only way to ensure certainty to continue. Another Member talked about supply chains and making sure that production continues, so that Tata can deliver the contracts it has in place. The only way to do that is with electric, and that is the way we are going forward.

Commercially sensitive conversations can take place in a much tighter circle, but the hon. Gentleman will know that discussions have been going on for years and years. There is now a transition board, and there will be a huge amount of consultation. The focus is on ensuring that the people impacted are provided with the support they need to transition into the jobs that they should. The fact is that we are securing the future of the steel sector in the hon. Gentleman’s constituency. Without this funding all 8,000 jobs would have been lost, along with 12,000 in the supply chain, and we are not seeing that. We are backing steel in his patch.

[Alun Cairns (Vale of Glamorgan) (Con)]

The Minister is absolutely right when she says that steel is of strategic importance to the UK’s security interests and to our manufacturing base. We need to recognise the scale of this investment, which strictly speaking is a devolved responsibility. This is the UK Government coming in to support a UK national interest. Tata has long held an ambition to turn this into an electric arc furnace. What assessment has my hon. Friend made of suggestions that electric arc steel is inferior to virgin steel, which is made in blast furnaces?

[Ms Ghani]

My right hon. Friend, who spent a considerable amount of time as Welsh Secretary, knows very well how these relationships work. He is absolutely right: the negotiations and securing the £500 million investment have taken place via the Government here. It was important for us to make sure that the Secretary of State for Wales and everyone else involved were across this, too. He is absolutely right that there is a difference in the steel produced—my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), the hon. Lady for steel, pointed out the importance of virgin steel—but there is a growing circular economy for steel produced in electric arc furnaces. It utilises scrap metal that is in abundance in the UK—we export tonnes of it—so there is a huge amount of work to be done in electric arc furnaces. That is why the business model is so substantial and why Tata put in so much money, with our £500 million going into the £1.25 billion commitment in total.