UK Steel Industry

Pat McFadden Excerpts

Monday 29th February 2016 Commons Chamber

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

As always, it is a privilege to speak about an issue that is so important, not only for my constituents but for the future of the whole UK steel industry and manufacturing industry, as my hon. Friend the Member for Oldham West and Royton (Jim McMahon) has said. I pay tribute to the Celsa workforce in my constituency; to those who work for Tata and the rest of the steel industry in south Wales; to the Welsh Labour Government, who are doing so much for the steel industry in Wales; and to trade unions such as Community, whose union reps are standing up and working with the management to try to find solutions and get through these incredibly challenging times for the industry.

I do not want to repeat many of the arguments that have been made. This is the umpteenth debate we have had on this issue, and the Minister is well aware of the wider circumstances and challenges facing the industry, so I just want to zero in on some specific concerns.

The Secretary of State was slightly disingenuous when he tried to present us as protectionists who want to foment trade wars in the world. That is not what we want. I reiterate that this is about levelling the playing field so that we relieve the pressure on the industry that is the result of dumping and unfair production.

I was pleased to hear what the Secretary of State said about rebar. If he moves in that direction, it will be welcome, but the industry will want to know at what level he really thinks the tariffs should be set and when that will happen. We can also discuss why that did not happen earlier, and why he did not fight earlier for those changes in Europe. The Secretary of State for Wales and I met many months ago and discussed those issues, and we were well aware of the concerns. If the Secretary of State for Business, Innovation and Skills is moving in that direction, will he tell us when will it happen and at what level the tariffs will be set? He made a convoluted argument about the lesser duty rule, but that will not wash with the industry. The industry wants to know what action the Government will take and when.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Does my hon. Friend agree that if a decision is made to impose tariffs as an anti-dumping measure, the whole point is that they have to be at a level that makes a significant difference to the price? Otherwise, the danger is that it becomes a token gesture.

[Stephen Doughty]

My right hon. Friend is absolutely right. As I said, if we do not put those tariffs up and other countries do, our industry will end up with double or triple dumping, with all its consequences.

The Minister has talked on many occasions about the compensation package. It has been long in coming, and its announcement was welcome, but the reality is that a lot of that compensation has simply not yet been paid. I have spoken to Celsa, in my constituency, in recent days. Can the Minister tell us how much compensation has been paid out and what difference it is making today? I am not talking about promises for the future; I want to know what difference it is making today.

I want to bring the Minister’s attention back to the charter for British steel, which we have discussed on several occasions. It laid out a clear set of arguments about sustainability, quality in procurement, and the sort of steel that we can produce, which we should be using in our construction and infrastructure projects. BS 6001 certification shows that steel has been manufactured in a sustainable and responsibly sourced manner and that, crucially, it can be traced back to its raw materials. In defence infrastructure projects or projects such as Crossrail—in which Celsa rebar has been used—we want to ensure that we use high-quality British steel that can be traced, and which has high carbon standards and high-quality standards, so that we can be sure it will be there for the long term.

There are some wider questions that I would like the Minister to answer. I turn briefly to procurement, because I think the Government have been somewhat disingenuous in claiming that the whole thing is done and dusted and that action has been taken. There have been welcome statements from the Minister and others about the guidance that is being given. I am concerned, however, about the fact that although we are asking Departments what they are doing, the Ministry of Defence has said that it is not keeping the records. The Secretary of State said earlier that his Department will be helping other Departments. He needs to get in there and ensure that the MOD keeps the records in the first place, as well as driving and advertising opportunities for procurement. Look at the list of projects: the Tide class tankers, the Scouts—now Ajax—and the frigates—[Interruption.] The Minister is absolutely right to say that we do not make the steel for Ajax, but other parts of the programme could be sourced from UK steel. There is still no answer on the customisation of the Tide class tanker, which was made in Korea. Those are the real questions.

The Minister was chuntering earlier about doing down the industry. We can produce that high-quality steel in the UK, and we should get to the bottom of why British companies are not bidding for or securing some of those projects. The Department for Business, Innovation and Skills should do all it can, with other Departments, to facilitate that market—[Interruption.] The Minister says that the Department does so, but the facts do not add up.

Finally, I want to talk about our role in Europe. I am glad that the Minister agrees that our place is in the EU, and it is a pleasure to have her supportive messages on social media about that. I am glad that we agree. I firmly believe that we achieve more for the steel industry working together across Europe than we would alone, but the Government have to be in there, fighting for the UK steel industry. I know that the Minister has done that on several occasions.

The reality is that the Government were warned years and years ago about the pressures facing the industry. A company such as Celsa in my constituency faces 70% higher energy costs than companies in Germany, as well as the dumping that the Government have been warned about so many times. If Ministers do not deal with those concerns, there is no possibility of pan-European co-operation. Why did it take so long for the Secretary of State to get out there and make that case in Brussels? Will she give us the absolute assurance that, during the next crucial months for the industry, she and he be will out there making that case on the duties, procurement and cross-European infrastructure? Only by doing that will we achieve the benefits for the steel industry that all of us across Europe want.

I want to see a future for the steel industry. I am glad that the Government are being pulled, kicking and screaming, on some of the issues. We need action and for it to keep coming, and we must ensure that we have a future for the steel industry in south Wales and across the whole of the UK.