Steel Industry (Nationalisation) Bill

Peter Kyle Excerpts

Committee of the whole House
Tuesday 9th June 2026 Commons Chamber

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

I beg to move, That the Bill be now read the Third time.

This Government believe in Britain’s steel future. This Bill will help to transform that belief into a reality. It will ensure that the long-term vision for our UK steel sector is realised, helping to restore domestic production to sustainable levels and to support this Government’s economic growth plans. This Bill provides powers for the Government to bring steel companies into public ownership, subject to the public interest test being met.

In many ways, the progress of this Bill has shown the House at its very best, with passion, insight and determination to take action in the national interest. We had an excellent and wide-ranging debate, with Members from all parts of the House recognising the importance of passing this legislation. Let me begin by thanking Members for their time and their thoughts. I express my gratitude to those who have contributed to the passage of this Bill so far, especially those who have taken a particular interest in ensuring that we get the details of this vital piece of legislation right.

I also take a moment to recognise those working in and supporting our steelmaking communities. Every day, they make a vital contribution to our country’s economic security. During the passage of this Bill, we have heard much about the specific situation at British Steel Ltd, and in particular about its current ownership status.

Let me be frank with the House: our decision to proceed with this Bill—to take these powers now—has absolutely nothing to do with the national origin of the current owners, Jingye. We have always been and remain country-agnostic about the current ownership. We simply believe that the British public interest should be paramount in determinations about future ownership. We continue to welcome international investment into the UK, including from China. We remain committed to our legal and international obligations to overseas business and foreign investors. We are fully compliant with our treaty undertakings to protect overseas investors and businesses operating in the United Kingdom.

While this Government need to take steps to secure UK Steel’s capability, we are committed to doing so in a manner that respects the rights of businesses. When and where the Government exercise the transfer powers in the Bill, an independent valuer will be appointed to determine what compensation, if any, is payable. The Bill requires a clear public interest test and provides for a compensation scheme where that might be relevant. The Government fully respect the rights of businesses and investors subject to this Bill. We will continue at all times to act fairly, regardless of the nationality or background of those businesses.

I place on record my thanks to parliamentary counsel and officials in my Department for their hard work on drafting and guiding the passage of this Bill. I also thank the Clerks, the Doorkeepers, Hansard and all of the House and its authorities for making the passage of this legislation possible. Let me also, on a personal note, pay tribute to the Minister for Industry, my hon. Friend the Member for Stockton North (Chris McDonald). A lifetime of dedication to the steel sector has brought valuable insight, passion and creative parliamentarian work to the Bill, which has enriched the debate in this place.

The House has sent a clear message about the importance of decisive action to safeguard the future of the steel industry. Since I became Secretary of State, I have championed an activist, interventionist industrial policy—activist, because the years of standing back and watching British industry decline are over; interventionist, because we, like other Governments around the world both right and left, from the United States to France and Germany, step in to invest, modernise and protect our industries. Our policy is both activist and interventionist, because purpose without action is merely rhetoric, and acting without purpose is performative, not strategic. The Bill is action with a purpose, and the purpose is clear: to invest in, modernise and protect Britain’s steel.

I am encouraged to witness the strength of support in the Chamber for this activist, interventionist Bill. As it moves to the other place, let me reiterate my commitment to continued engagement with parliamentarians as it completes its passage and we ensure that the Government’s vision for Britain’s steel sector becomes a reality. I commend the Bill to the House.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

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[Peter Kyle]

With the leave of the House, I would like to thank my hon. Friend the Member for Darlington (Lola McEvoy) for her passionate speech and my hon. Friend the Member for Clwyd East (Becky Gittins) for her heartfelt speech just now. Those are the kinds of contributions that give heart and soul to what we are trying to achieve, and that give voice to the communities affected. I also pay tribute to the hon. Member for Brigg and Immingham (Martin Vickers) for his contribution. I commend the Bill to the House.

Question put and agreed to.

Bill accordingly read the Third time and passed.

Fastest Growing Firms: Government Support Package

Peter Kyle Excerpts

Tuesday 9th June 2026 Written Statements

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

The Government are today announcing an ambitious new package to provide support for the UK’s high potential scale-ups to grow and stay in the UK.

Scale-ups contribute £2.2 trillion to the UK economy and employ 3.9 million people, despite making up just 0.8% of businesses, yet not enough scale into global leaders.

This Government have taken steps to address the scaling gap through recent measures including the modern industrial strategy, the plan for SMEs and the tax incentives and measures announced in 2025’s autumn Budget.

Now we are going even further, in a sustained cross-Government effort to close the scale-up gap and make the UK the first choice for our top scaling talent as we strive to produce the UK’s first trillion dollar firm.

For high growth, strategically important scale-ups with the potential to be the UK’s first trillion-dollar company, the UK Government will act as the strategic partner, offering a concierge service that will act quickly and decisively to help these companies tackle barriers to growth, whether that is accessing talent or markets—either overseas or HMG procurement—or regulatory barriers.

To strengthen the UK’s pipeline of high growth firms, I have launched an external tender for an expert third party provider to run an 18-month pilot from autumn 2026. As set out in the industrial strategy, I want to broker new relationships with businesses and use the expertise and experience of those partnerships to our full advantage. This will establish tangible and robust 12-month intensive support for scale-up founders that are facing critical tipping points in their growth journey. Companies will receive tailored action plans with the focus of support on networking, markets, investment and talent.

Delivering the growth agenda in lockstep with industry is critical, and I am grateful for the input from my Industrial Strategy Advisory Council and industry experts as we have developed this offer for scale-ups. We will continue working closely with industry to identify where the UK can go further in boldly backing scale-ups. That is why today I have appointed Penny Verbe—who has founded and scaled global companies—as my scale-up adviser, to ensure our support reflects what businesses need and to champion the sector.

[HCWS95]

Oral Answers to Questions

Peter Kyle Excerpts

Thursday 21st May 2026 Commons Chamber

[Gurinder Singh Josan (Smethwick) (Lab)]

1. What assessment he has made of the potential merits of introducing digital ID for businesses.

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

It is going to be a busy day for the Department for Business and Trade team. We are going to be spending a lot of time together today, Mr Speaker, and I very much look forward to it.

We are improving how businesses find, log into and use digital Government services. Better digital services—increasingly joined-up services—can reduce administrative burdens and save businesses time and money. That is why we have pledged to reduce the administrative burdens on business by 25%, and digital will play a key role in that.

[Gurinder Singh Josan]

Small businesses are the backbone of our economy, yet research shows that the average small business cannot start its real work until 2.36 pm on a Wednesday because of the time lost to administrative tasks. My own experience is that business owners need to engage regularly with various departments and agencies for all manner of reasons, and proving their identity can be a time-consuming task, so will the Secretary of State consider introducing a unique business passport—effectively, a unique digital ID for businesses—to cut administrative burdens and free up small businesses to deliver growth?

[Peter Kyle]

My hon. Friend and I share a zeal for using digital to transform the relationship between Government and those who use services. When I was the Secretary of State for Science, Innovation and Technology, I was very proud to work with the Government Digital Service team and see how they are transforming the ability of individuals to interact with Government. We need to have the same zeal for transforming how businesses interact with Government, and I can assure him that a programme of work is going on with my Department to make sure that that is the case.

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[Mrs Elsie Blundell (Heywood and Middleton North) (Lab)]

3. What recent discussions he has had with Royal Mail on the adequacy of its service levels in Greater Manchester.

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

The Minister responsible for small business and economic transformation, the Under-Secretary of State for Business and Trade my hon. Friend the Member for East Renfrewshire (Blair McDougall), met Royal Mail’s chief executive on 12 May to discuss its service improvement plan. I know that my hon. Friend has been campaigning on these issues in her constituency vigorously and that has been heard loud and clear. Royal Mail has told my Department that Middleton delivery office in my hon. Friend’s constituency is fully staffed and delivers to most addresses six days a week. I know that she will be scrutinising that and might well have a bit more to say on that now.

[Mrs Blundell]

Last week, I held a meeting at the fantastic Burnside community centre in Langley with representatives from Royal Mail and constituents, including those who have had to deal with a substandard postal service resulting in crucial correspondence arriving weeks late, if at all. To many people in Heywood and Middleton North, that is a direct result of a national asset being sold off to a private company focused on profit rather than quality of service. If that level of service continues, what further options is the Secretary of State considering to hold Royal Mail to account, and where necessary will the Government step in and force the changes that my constituents need to see?

[Peter Kyle]

I said that my hon. Friend was a great advocate for her residents on this issue; she is proving so once again. I can reassure her that the Government have secured a commitment from Royal Mail’s owners to prevent the payment of dividends until service levels improve. That will be a tangible impact on the business unless service levels improve. I have also been involved in discussions with Royal Mail’s owners and the Communication Workers Union to get a deal that can start work on the universal service offering and modernisation reform package for the company, as well as one that tackles pay equalisation. They have reached a deal and it is now out to CWU members. I hope that that will be the foundation for real improvement into the long term. It shows this Government’s active industrial strategy that get things done.

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[Tessa Munt (Wells and Mendip Hills) (LD)]

7. What steps his Department is taking to support small and microbusinesses in rural areas.

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

Ensuring that business support takes account of rural needs is incredibly important for this Government. Around one in six people live in rural areas in England, with over 520,000 businesses contributing £259 billion to the English economy.

[Tessa Munt]

My constituent Jason runs The Cider Barn in the village of Draycott just outside Cheddar, a fantastic local venue that hosts live music and serves, unsurprisingly, really good local cider and ales. Jason was rocked by this year’s massive increase in business rates, which have jumped from £100 a month to £600 a month. I should not have to explain that that meant a significant rise in his operating costs. This kind of shock makes it so hard for micro and small businesses to survive, let alone to thrive. Given how important The Cider Barn is to the local community, what can the Minister say—and, importantly, do—to assure small businesses like Jason’s that they will be supported by this Government?

[Peter Kyle]

The fact that the hon. Lady’s constituent works in the hospitality sector and is located in a rural area means that he requires multiple types of support from this Government, which he is getting. We have permanently lowered the business rates multiplier for eligible retail, hospitality and leisure properties. That is worth nearly £1 billion and benefits over 750,000 businesses. I imagine that his business will fall within the definition of a small business. Just this week, we have introduced legislation to tackle late payments for small businesses, which will inject another £11 billion into the economy. This Government are on the side of businesses, whether they are in urban or rural areas and whether they are large or small.

[Mr Speaker]

I call Perran Moon.

[Peter Kyle]

My hon. Friend is describing businesses that are the lifeblood of the British economy, and the innovation that flows from them is vital. The Department for Environment, Food and Rural Affairs’ rural taskforce is taking a strategic view of the challenges faced by businesses in rural areas, and I imagine that the one that he mentions will be in scope. The business growth service also includes growth hubs across the UK, which are supporting businesses in rural areas so that they can get the growth they need into their businesses.

[Sir Julian Smith (Skipton and Ripon) (Con)]

8. When he plans to publish his Department’s review of and consultation on the opt-out collective actions regime.

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[Jerome Mayhew (Broadland and Fakenham) (Con)]

T2. If he will make a statement on his departmental responsibilities.

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

I am grateful to the hon. Gentleman for not ruining my moment to shine.

I told the House that I would be an activist, interventionist champion for business. I am very pleased to say that later today, the Chancellor will announce funding for two of our foundational sectors: ceramics and chemicals. She will set out more detail to the House shortly, but I can say that we are working with industry and experts to provide the targeted intervention that those sectors need. Today’s business tells the story: this Government stand with British business when it comes to creating the resilient and growing economy that this country deserves.

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[Andrew Griffith (Arundel and South Downs) (Con)]

First, I congratulate the Government on securing the Gulf Co-operation Council deal. Success has many authors, and Members on both sides of the House have been part of these negotiations as Ministers, but a win is a win. These are—[Interruption.] These are our historical friends and allies, and this is part of a growth agenda.

Summer is approaching and young people are graduating. The Office for National Statistics reported this week that, as a direct result of this Government’s choices, one in six young people is looking for a job, but cannot find one. Sectors like retail and hospitality are shedding jobs by the thousands. Will the Secretary of State finally accept that, well-intentioned or otherwise, the Government have got it wrong?

[Peter Kyle]

It speaks for itself when the Opposition try to take credit for the Government’s achievements. It shows just how good this Government actually are. However, I am grateful for the hon. Member’s warm words about the GCC deal. A lot of work went into it, but of course when we came into office, we were practically on the starting line; we were so close to it at that moment.

I will be really up front about youth unemployment. This issue faces most communities in our country, and we should have much more cross-party support on it. In the interests of offering an olive branch, let me say that as someone who had a challenging pathway through education into employment, I recognise the issue. However, the Opposition must admit that, in the three years before they left office, youth unemployment went up by 250,000. Yes, we will work together, but it does—

[Mr Speaker]

Order. Secretary of State, my words apply to you as well as to Back Benchers, because I am trying to help your Back Benchers get their questions in. We will now hear a very quick question from the shadow Secretary of State.

[Andrew Griffith]

I thank the Secretary of State for his answer. I hope he would agree, cross-party, with the Tony Blair Institute, which has said that the UK must restore “dynamism” to its labour market, rather than imposing restrictions such as the Employment Rights Act 2025. Could the Secretary of State, who is a good man, at least promise me that, if he gets to serve as Chancellor in a Government led by his friend, the right hon. Member for Ilford North (Wes Streeting), he will use that chance to change the Government’s approach?

[Peter Kyle]

Dynamism is increasing in our economy, and that is why we have so much growth—growth that the Conservatives failed to deliver in their 14 years. As for young people, we have the youth guarantee, which includes a six-month funded programme placement that provides a rich environment for kids who were put out of work—a lot of the time, by the Conservatives when they were in government. It gets kids back into work, and does so sustainably.

[Imran Hussain (Bradford East) (Lab)]

T5.  Bradford is a proud multicultural city, and we celebrate all the good that diversity brings. We speak over 100 languages, and I am sure you will agree, Mr Speaker, that we have the best cuisine in the country. We hosted amazing events as the city of culture last year. We have one of the youngest populations in the country, and one of the highest business start-up rates. What further steps will this Government take to boost our economic growth, and provide support for our young people and, in particular, business start-ups?

[Peter Kyle]

Just last year, I was in my hon. Friend’s neck of the woods for the investment summit, unleashing further billions into his part of the country. I know that the automotive sector is incredibly important to him, and we are pledged to getting back to the level of automotive output we had before the Tories halved it. When we get back to that point, he will see a flourishing, booming industry, with the jobs that follow.

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Sarah Olney (Richmond Park) (LD)]

According to reports in both the Financial Times and The Times, the Government have asked supermarket retailers to reduce the price of essential food items, such as milk, bread and eggs. The chief executive officer of Marks & Spencer has described the proposals as “completely preposterous”. Can the Secretary of State confirm that instead of trying to impose price controls on private businesses, his Department will look to reduce the cost of Government-imposed burdens on retailers, such as business rates, national insurance contributions and energy costs?

[Peter Kyle]

There will be no price cap and there will be no price controls, but I am not going to apologise for throwing everything and the kitchen sink at the cost of living challenges that we inherited, along with an economy that was broken.

[Chris Webb (Blackpool South) (Lab)]

T6.  I was delighted recently to host the hospitality Minister, the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Halifax (Kate Dearden), at the top of our iconic Blackpool tower, alongside our tourism CEO Kate Shane, to discuss the opportunities and challenges facing our visitor economy. Our tourism sector supports thousands of jobs, yet local small and medium-sized enterprises are being hit hard by rising costs and the pressure of a seasonal economy. But Blackpool comes to the Government not with problems alone, but with a clear credible plan. Does the Secretary of State agree that coastal towns require targeted economic support, and will he back our proposal to pilot a new tourism zone?

[Peter Kyle]

I am very grateful for my hon. Friend’s question. Yes, I can say that Little Layton in his constituency is one of the 379 communities across the UK that will receive Pride in Place funding, just one of the cross-departmental packages of support that his constituency will benefit from. We will not forget. We will keep on supporting him all the way.

[Sir Julian Smith (Skipton and Ripon) (Con)]

T3.   JB Springs in Skipton has been in touch on the issue of quotas. It imports steel and is worried about the cost of steel and the future of the company. Personally, I do not have an issue with many aspects of the Steel Industry (Nationalisation) Bill, but the quota issue is really causing problems. Is there a structure enabling colleagues to meet people from the Department, so that businesses can communicate their worries? Will the Minister keep an open mind about the quotas and review them in less than 12 months?

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[Mr Speaker]

Order. Please, come on! Tell me who you don’t want me to get in, because that is what happens when we do this.

[Peter Kyle]

My hon. Friend raises an incredibly important point. The UK Government have a support package for England, with £4.3 billion to protect ratepayers. The Barnett consequentials provide support for Scotland, but where the UK Government are supporting businesses, the SNP is choking off investment and risking jobs.

[Bradley Thomas (Bromsgrove) (Con)]

T8. The Government’s new steel tariff and quota regime, due to come in in a few weeks, means that many businesses face a cliff edge. One in my constituency recently got in touch to tell me that it faces either a slow death or a swift death, and that it faces calling in the administrators before Christmas. Will the Minister keep an open mind about extending the transitional period, and will he agree to meet me and a very small number of my constituents who will be affected?

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[Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)]

The Committee is meeting steel makers later today and will supply the Government with its advice from that, but I want to raise the automotive sector. We are not going to double automotive production in the way the Secretary of State wants unless we fundamentally reform the zero emission vehicle mandate. Auto makers are subsidising sales by £5 billion a year. They are transferring money to state-subsidised players, such as BYD, and battery costs have not fallen. Will the Secretary of State bring forward a whole-market review and reform the ZEV mandate for good?

[Peter Kyle]

My right hon. Friend, as always, gives great voice to the automotive sector. I have listened closely to the voices of the sector in relation to the ZEV mandate—it is important that we do that. It is also important that, when setting such targets, we take into account consumer demand. That is something I am very aware of and having conversations about with colleagues across Government.

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[Adam Jogee (Newcastle-under-Lyme) (Lab)]

I am delighted that the Government have listened to my calls, and those of my neighbours in Stoke-on-Trent, to finally act to support the ceramics industry—calls so loud that my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) has lost his voice. While we await the detail, will the Secretary of State come to North Staffordshire to meet the ceramics businesses that he and this Government are helping today?

[Peter Kyle]

I am grateful to my hon. Friend for his comments. The package that we are announcing today will be significant. I will not say any more, because the Chancellor will be making that announcement later. I can say, however, that the boldness of the package is a direct consequence of the voices that we have heard from MPs, including from my hon. Friend and others in Stoke—whether losing their voice or not. Those voices have been profoundly important to the scope, scale and boldness of what will be announced today.

[Wendy Chamberlain (North East Fife) (LD)]

Hospitality businesses in North East Fife support the Lib Dem call for a VAT cut for hospitality, but the Government do not seem to be moving on it. Will the Minister consult with businesses on a lower national insurance contribution band for part-time workers? Part-time opportunities are so important to hospitality and for getting younger people into work.

[Rachael Maskell (York Central) (Lab/Co-op)]

In October, Nestlé announced 16,000 job losses, including 450 in the UK. In the light of the significant impact that this will have in York, will the Secretary of State ensure that meaningful consultation happens with the trade unions, and will he meet them to save those jobs?

[Peter Kyle]

Yes, of course I will.

[Olly Glover (Didcot and Wantage) (LD)]

Small businesses in Didcot’s Broadway are struggling with energy and staff costs, business rates and a rising tax burden, and the older town centre would benefit from investment and rejuvenation. For areas, such as Didcot, that did not receive Pride in Place funding, what suggestions does the Secretary of State have for funding or other forms of support?

[Peter Kyle]

What businesses in Didcot and right across the country need is a fast-growing economy, and that is what we are delivering.

[Leigh Ingham (Stafford) (Lab)]

In my constituency we are seeing good growth in our large employers and a great skills pipeline coming through from our advanced technical college, but we need a little support for our SMEs. Will the Minister say what targeted support is available for SMEs in towns like Stafford?

Steel Industry (Nationalisation) Bill

Peter Kyle Excerpts

2nd reading
Thursday 21st May 2026 Commons Chamber

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

I beg to move, That the Bill be now read a Second time.

For generations, the steel industry has stood at the very heart of our national story. From the furnaces of Sheffield to the docks of Port Talbot, from Scunthorpe to Redcar, steel forged not only the railways, ships, bridges and factories that powered the industrial revolution, it built communities, livelihoods and a sense of pride in Britain. Steel made in Britain built our Navy, helped to defend our freedoms in times of war and laid the foundations for modern infrastructure right around the world. When people speak of the United Kingdom becoming a great industrial nation, they speak of the skill, resilience and determination of the steelworkers who helped to shape that destiny by the fruits of their labour.

The decline of the steel industry destroyed jobs, diminished skills and damaged communities, but it never, ever diluted the pride, resilience and determination of those working people. Today, this Steel Industry (Nationalisation) Bill repays, in part, the debt that we owe Britain’s steel communities. Steel is integral to the key growth-driving sectors of our industrial strategy: to advanced manufacturing and the car industry; to clean energy, in our wind turbines and our grid infrastructure; and to security and defence, in fighter jets, battleships and submarines. It is essential to this Government’s growth mission to create a strong, resilient economy delivering for working people. That is why Britain’s steel sector accounts for thousands of jobs, right across the country.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

For the reasons that the Secretary of State has mentioned, the nationalisation of the steel industry is a noble endeavour, with which many of us from across the House will agree, but there are people in Wales pointing to the fact that, despite there being legislation, Port Talbot has lost thousands of jobs. Does he recognise the feelings that remain in Wales because the option of nationalisation by this Government was not on the table at the time?

[Peter Kyle]

As the right hon. Lady knows, I have been to Port Talbot and I have launched a steel strategy since this Government came into office. The vast majority of the decline that she describes happened under the previous Administration. We are cleaning up the mess on a whole bunch of fronts and in different areas of our public life. This Government have invested £500 million into that plant, and we have launched a steel strategy that I believe will give it a fruitful and prosperous future. We are doing what it takes to be the partner needed in these times.

[Mr Calvin Bailey (Leyton and Wanstead) (Lab)]

The nationalisation of the steel industry explicitly links our domestic and international policies. It demonstrates the need for us to go out and champion our steel sector by filling its order books, as we have been able to do because of the wonderful trade deal created with Nigeria, which is expanding its ports and railways, that has been achieved by this Government. That is the type of work that I am doing in southern Africa, and it is the type of work that we should all be going out to do on behalf of our country and our growth agenda.

[Peter Kyle]

The work that my hon. Friend is doing is incredibly important to fulfilling the mission, and the possibility that the British steel sector has in the 2020s and going forward. That is the purpose of having a strategy where we invest and modernise, and then at times we need to protect as well. These are the things that we are doing to deliver a long-term, sustainable and global future for Britain’s steel industry.

[Kit Malthouse (North West Hampshire) (Con)]

I have two quick questions for the Secretary of State. First, if the Bill passes, how are the global competitors to British forged steel likely to react? Secondly, if our steel becomes more expensive than the global market norm, what choice will manufacturers in the UK be faced with about where to base their manufacturing?

[Peter Kyle]

I am not sure why the right hon. Gentleman would think that British steel would be more expensive as a result, but let us take one step back: if we did not protect, there would be no steel sector to export in the first place. That is why I took the decision to invest, to modernise and to protect where needed. If this Government had continued on the same trajectory that we inherited from the previous Government, I would fear for any steelworks at all being capable to export, let alone producing domestic supply as well. This is the future that we are now creating.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

On that point, will the Secretary of State give way?

[Peter Kyle]

I am going to make some progress because the debate has been cut short. I have taken a few interventions and I am sure I will find time for the right hon. Gentleman to intervene later in my opening remarks, but first let me make a bit of progress.

I have pledged to ensure that Britain retains its capacity and capability to manufacture steel. It is a commitment that I have made to hon. Members in this House and it is my commitment to the steel communities of this country. This House acted last year to support British Steel, which is one of the country’s most vital steel firms. We recalled Parliament to pass the Steel Industry (Special Measures) Act 2025 so that the company’s blast furnaces could remain lit and its workforce could remain protected. I am grateful to my predecessor, my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds), for his leadership during that time, and I am grateful to the House for supporting that vital piece of legislation.

When we intervened then, we were certain that there was a future for British Steel. Our determination now is that the future may best be served by full public ownership in the national interest, not because of ideology, but because of practical pragmatism. Public ownership would allow us to explore future opportunities for the company and to retain its vital resource as a critical piece of our national infrastructure—one that is essential to our economic resilience. I want British Steel to play its part in driving up our domestic steel production to ensure that 50% of the steel used in this country is made in this country.

[Dr Murrison]

In keeping open the options that the Secretary of State hints at, has he had any discussions with his colleagues in the Ministry of Defence? At least for the foreseeable future, there will always be a need for virgin steel for certain defence applications.

[Peter Kyle]

The right hon. Gentleman raises a really important point. This Government are determined to make, produce and use more steel from the British sector in lots of different areas of the economy, and we want to ensure that we are using Government spending and procurement in driving up steel production in the UK.

I had the privilege to visit the Agratas gigafactory in Somerset. It is in a different sector, but it is using 231 tonnes of British steel in its production. That is using an amount of Government investment as well, so it has Government investment and private sector investment and is using British steel. That shows that when we align our priorities, we can drive up demand for British steel.

[Sir Jeremy Wright (Kenilworth and Southam) (Con)]

I want to ask the Secretary of State about the breadth of the Bill. Clause 1 makes it clear that a “steel undertaking” includes those businesses that have the “manufacture or processing” of iron or steel as part of their operations. Is there any lower threshold to that? Is a business that has only 1% of its operations in iron or steel liable to nationalisation under the Bill?

Under clause 2, the Secretary of State is entitled to determine the public interest and can nationalise if it would support

“the economy of the United Kingdom or any part of the United Kingdom.”

I have the same question: is there any lower threshold? Would the interests of one town where a steel facility is located be sufficient to justify the nationalisation of an entire company?

[Peter Kyle]

The public value test is a high test, and I think the right hon. and learned Gentleman will agree that that is the case on seeing and reading the legislation, as he has done.

I have set the bar high enough that this power would be triggered only in extraordinary circumstances. These are things that we can test in Committee in the coming days—I believe that will be next week. [Interruption.] It will be in the next sitting week, when we return from recess. Do not worry; we are not recalling Parliament again. I will address this matter a bit more in my speech. This power will not be used routinely; it is a specific power, and the test for it will be high.

[Sir Jeremy Wright]

Will the Secretary of State give way?

[Peter Kyle]

I will make some progress.

To that end, we began negotiations in good faith with Jingye, the owner of British Steel, to see if a commercial sale was viable, but that did not prove to be possible. We could not agree terms that would have safeguarded simultaneously the integrity of the business and the interests of the taxpayer. That is why the Prime Minister announced the Government’s intention to bring British Steel into public ownership, subject to the public interest test being met at the time of that decision. That is why we need to pass the Steel Industry (Nationalisation) Bill now, to give us the power to make that possible.

Let me be clear to the House. In answer to the question from the right hon. and learned Member for Kenilworth and Southam (Sir Jeremy Wright), the powers given to the Government by the legislation cannot be exercised without due caution and proper care. These powers are bold, but they are not boundless. They can be used only where there is a clear public interest and where they will be needed to safeguard British steelmaking capability. The Bill does not nationalise British Steel in and of itself, but it grants the Government powers to do so if considered necessary. That is the scope of the legislation we are debating today.

[Sir Jeremy Wright]

The Secretary of State is being generous. I take him at his word as I do not think that he intends to use this legislation otherwise than appropriately. However, there is an important point to be made about the language in the Bill as it stands. As he knows, the public interest test is defined in certain ways in clause 2, which states that the test “is not limited to” the grounds listed, so there could be other grounds on which the public interest might be met. I have already pointed out one aspect in which the public interest test is relatively broad. I invite the Secretary of State to look again at the public interest test to make sure that we do not just rely on his word, which I do, but that we are confident that succeeding Secretaries of State cannot misuse this power to nationalise too broadly.

[Peter Kyle]

I am grateful for the right hon. and learned Gentleman’s intervention. I knew when I was bringing these powers in and working through the legislation that they would be an important part of the Bill and rightly the subject of scrutiny. There will be significant time in Committee of the whole House for Members to scrutinise the legislation. We are modelling this Bill on the Banking Act 2009, which has worked effectively. In that circumstance, the powers were used during the financial crisis in extremis, and those powers, on which we are modelling this Bill, have not been used irresponsibly since. I have been clear about my expected use of these powers, and the bar set in the legislation meets my expectations, including limiting my ability to use these powers in ways that would cause concern for Members.

For too long, the steel sector in this country has been left to fend for itself, abandoned by Government, demoralised, starved of resources and the victim of international market distortions. Crude steel production has declined by more than 50% in the past decade. Capabilities have been reduced, and communities have been let down. Previous Governments have been too reactive and not proactive. This Government will not repeat the errors of the past. We are building the future for British Steel. While the industry faces challenges today, we will do everything we can to help it modernise and grow. This legislation allows us to apply that policy to this industry. We recognise that securing the long-term future of the UK steel sector relies on public and private investment for modernisation, so that the UK can become a global leader in clean green steel, electric arc furnaces and decarbonised steel production.

We recognise that blast furnace production will need to continue in the immediate future and that a managed transition is vital to maintaining supply. We need this legislation to raise resilience, to protect businesses up and down the country that depend on Britain’s steel, to defend the workforce at British Steel and to safeguard the communities built on British steel. The significance of steel is not simply a matter of history; it is a matter of our national future. In an uncertain world, the ability to make steel remains a strategic national asset. Steel is essential for our transport networks, our energy security, our housing and our transition to a greener economy. That is why supporting the British steel industry is about more than protecting jobs, important though they are. Supporting British Steel—

[Warinder Juss (Wolverhampton West) (Lab)]

Will the Secretary of State give way?

[Peter Kyle]

I will give way in just a moment. Supporting British Steel is about more than national pride, although we are proud of the steelworkers who help build it. Nationalising British Steel is about hope and faith in the future.

[Warinder Juss]

I did not mean to interrupt my right hon. Friend, but I thought this was an appropriate time to intervene. As a member of the GMB trade union executive council, I was pleased to see my union welcome the Government’s move to nationalise British Steel, which it described as a

“decisive and timely intervention by the Government which will protect one of the UK’s most important industries.”

That sentiment has been echoed throughout the trade union movement. Does my right hon. Friend agree that we must engage with the trade unions throughout this process and utilise their expertise in this area to secure the long-term future of British Steel?

[Peter Kyle]

My hon. Friend raises a really important point. Workers in steel production facilities have played a really important role in shaping our policies, helping us constructively to find a way through. Members on both sides of the House were prodding me to release the steel strategy more swiftly, but there were so many moving parts at the time of developing it. There were global forces at work, different ownership models and different production facilities, with different challenges, in different parts of the steel community. I will say this again: the unions played a highly constructive role. I pay tribute to GMB, Community and others for helping us to design our policies and find a way through some really challenging strategic issues.

Together with our measures on automotives, digital technology, the life sciences, the defence industry, clean energy, ceramics and chemicals—on which we made announcements today—and advanced manufacturing, taking the power to make possible the nationalisation of British Steel heralds the new dawn of an age of British industrialisation.

[Greg Smith (Mid Buckinghamshire) (Con)]

Given that no UK steel producers produce the specialist grades of steel used by precision engineers such as Gibbs Gears in Stoke Mandeville, in my constituency, which supplies components for the aerospace and defence sectors, what is in this Bill for them? All they can see are incoming tariffs on the steel that they necessarily have to import because nobody makes it here.

[Peter Kyle]

The hon. Gentleman will know that when I took the difficult decision to introduce measures, I did so for products that compete directly with the products that we are capable of making domestically. Speciality Steel UK is going through an administration process at the moment, but when that is complete and the company is up and running properly, I need to make sure that its products and services are protected and viable domestically. Given the world in which we are living, where national resilience is so important to our nation and the economy in a way that it simply has not been for decades, the decisions that I am making to ensure that British steel production is viable and sustainable are of paramount importance.

[Saqib Bhatti (Meriden and Solihull East) (Con)]

Will the Secretary of State give way on that point?

[Peter Kyle]

I am going to make a bit more progress.

While the Government are working alongside businesses to invest in, modernise and protect Britain’s manufacturing base, the amendment would deny the Bill its Second Reading. The very people who did so much to damage the steel industry in government are now trying to do so again in opposition—then as tragedy, and now as farce. As such, the House should reject the amendment. Britain’s steel industry needs an activist, interventionist Government, and it needs determination, decisiveness and delivery. It does not need a Government who have their hands tied, their room for manoeuvre blocked and their ability to act denied. Britain must have a strong domestic steel industry—now and into the future.

[Several hon. Members rose—]

--- Later in debate ---

[Stuart Anderson (South Shropshire) (Con)]

I do not support this Bill, and I believe that the reasoned amendment is the right way forward. I will set out clearly the devastating impact that the Bill is about to have, in real time, in my constituency.

We have a great local business called Amodil. It is a British family-run business that started with a couple of people in 1976 in Cleobury Mortimer, South Shropshire. I recently went to Cleobury to meet Paul, Chris, Ben and the team, as well as Rob Cooper from the British Stainless Steel Association. The business was founded by Paul Slingsby, who at 75 still works in it today. It is the UK’s largest privately owned supplier and stockholder of stainless steel long products, with more than 1,200 customers—about 20% of the UK market.

The people who run Amodil know what they are on about, and they were completely blindsided by the announcement on tariffs. They had not been told, and none of their customers or suppliers, or the people they were involved with, knew anything about it, so they came straight to me. I have written to the Minister multiple times and had one response. He needs to sit down with the largest British business in this industry and have a serious conversation.

The big issue that Amodil faces is the tariffs on the stainless steel products it brings in that cannot be made in the UK in the required quantity or type. The Government want to protect the steel industry as an industry of vital strategic importance—I get that—and they want to protect jobs, but for the almost 1,000 jobs they will save, many thousands more will be lost, and I will say exactly where.

The UK cannot meet domestic market demand, and a huge gap will be created. Businesses such as Amodil will be forced to import, and tariffs will drive up costs by 50%. There is not the cash across the industry to absorb those extra costs without mass redundancies. The costs will be passed on, meaning that manufacturers’ costs will go up. What will happen then? The customer will buy the finished product from manufacturers overseas at a lower price, and those products are not subject to tariffs. That does not level the playing field for us.

The UK does not produce enough stainless steel of the right type or quality to meet demand. Amodil currently has 5,000 tonnes of stainless steel in stock, 2,000 tonnes of which cannot be, and is not, made in the UK. It could take up to 15 years to get some of the skills right. Large-diameter bars of a certain grade are not made in the UK and those bars are vital to key industries, such as aerospace, defence, pharmaceuticals, oil, automative, general engineering and many more. If the tariffs are put on these businesses—Amodil is the largest British business in the field in the UK and there are many others—they will be priced out of the industry. I really hope the Secretary of State can see the importance of this matter.

[Peter Kyle]

I will save the hon. Gentleman from driving home the point even more, because I understand the passion with which he speaks. With regard to Amodil, I will look into that company personally. The intention with the measures that I have brought in is to protect domestic production and the possibility of domestic production. It is not to prevent goods that we do not make here, and do not intend to have the capacity to make here, from suffering. If there is a specific issue, I will look into that, because I do not want negative impacts downstream when we do not have the capacity to produce here. The Trade Minister said earlier today that he would look into that as well. We, as a team, will look into these issues.

[Stuart Anderson]

I thank the Secretary of State for saying that. I will follow up personally with him and with Amodil to see if we can talk about a way forward. I said to Amodil, “I believe that this is an unintended consequence of what the Government are trying to do, and once I point this out clearly, there will be a way forward to look at it.” The long and the short of it— I will put my speech to one side—is that there is a certain size of rod that only the UK can make. I watched it at Amodil’s facility a few weeks ago. When it gets past that size, it is not made in this country, but it is needed by so many of those critical industries.

Looking at steel as a whole, this matter is just one part of the stainless steel industry. If the Secretary of State, or one of the Ministers, will sit with me and the team at Amodil, they will be able to see, within a matter of minutes, where the gap is and how to plug it. It is along the blanket grading for all the bars. I request a pause for, say, just six months—or if we can talk with Amodil in a matter of days—so we can sit down and look at this, because there is a massive knock-on impact that will seriously hurt the stainless steel industry, and one of the largest employers in my constituency will be massively hurt too.

--- Later in debate ---

[Saqib Bhatti (Meriden and Solihull East) (Con)]

It probably will not come as a surprise to Labour Members, but I fundamentally disagree with the last speaker, although I appreciated his passion. [Interruption.] The Secretary of State is getting a bit excited; I will come to him in a minute on the issue of tariffs. I am proud that we are the only party in this House objecting to the Bill, and for the right reasons.

The Secretary of State repeatedly talks about making this country stronger, but I do not think this Bill does that by nationalising. I just do not think that Governments can run businesses. I certainly mean no disrespect to Ministers on the Front Bench, but they will create inefficiencies and push up prices, and the taxpayer will end up stomaching the cost. That does not make us stronger; it makes us weaker.

The hon. Member for Hartlepool (Mr Brash), who spoke before me, said that we are still in the 1990s, but I think this Government are taking us back to the 1970s by pushing up costs and lumbering the taxpayer. A future Conservative Government will have to unwind some of the real harm that will come to fruition. No Labour Members can tell us where the nationalisation will stop. Will it be ceramics tomorrow? What will happen? Which industries will the Government pick and choose?

In the limited time that I have, let me come on to the issue of tariffs. Like my hon. Friend the Member for South Northamptonshire (Sarah Bool) and all my hon. Friends who have raised this point, I have been visited by a constituent. His name was Peter Watson, of Davicon. I have written to the Secretary of State about this issue, although that was only last week; I respect the fact that he may not have had time to come back to me, but I hope he does.

Davicon is the UK’s leading mezzanine manufacturer. The briefing that Peter put in front of me was a result of the tariffs and the quota reduction. There is a reduction of almost 97% on merchant bars and an increase in quotas of 50%. For all the Secretary of State’s best intentions and whatever he wants to achieve, the reality is that industry and markets do not work to the whims of Government. They will not move quickly enough to do that, which will push up prices. In the briefing I saw, that would mean a doubling of the quota for per-tonnage steel by 1 July. That cost will have to be borne by industry and taxpayers. If we are talking about nuclear power plant creation or HS2, we know that those taxpayer-funded projects will have to bear those costs.

I was listening to the Prime Minister yesterday during Prime Minister’s questions, and it is clear the Government recognise that an issue is coming down the tracks. I argue that that should have been anticipated before the tariffs came into place, but we are where we are. I have written to the Secretary of State, and I would really welcome some serious action on this issue. My hon. Friend the Member for South Shropshire (Stuart Anderson) made a really eloquent argument about a delay in the introduction. If that is not going to happen—

[Peter Kyle]

indicated dissent.

[Saqib Bhatti]

The Secretary of State is shaking his head. If that is not going to happen, let us look at the HS codes. He needs to recognise that there will be a serious impact on the steel industry and the peripheral industries that rely on steel manufacturing in this country.

Ceramics and Chemicals Industries

Peter Kyle Excerpts

Thursday 21st May 2026 Written Statements

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

This statement provides an update on the Government’s support to ceramics and critical chemical producers, two of the foundational sectors underpinning our industrial strategy.

The Government are today announcing the launch of the ceramics industry support scheme of £120 million to support the transition of the ceramics sector to a more cost effective and less carbon intensive means of production. Supporting this transition continues to deliver on our mission to decarbonise the economy, helping businesses to invest and grow across the country.

The ceramics industry has a rich cultural heritage, notably in the Potteries in the Stoke-on-Trent area, and it remains a large source of employment in Staffordshire and neighbouring Derbyshire, as well as in areas across the UK from Devon to Dumfries.

However, in recent years the sector has faced a number of difficulties, including a challenging global trading environment, and the cost of reliance on volatile fossil fuels, which have seen costs increase significantly since the Russian invasion of Ukraine. These challenges have led to a pattern of decline and resulted in the closure of historic sites such as Johnson Tiles, Moorcroft Pottery, the liquidation of Royal Stafford, loss of jobs at Armitage Shanks, and the recent administration at Denby pottery.

This Government are clear that industrial decarbonisation must not be achieved by deindustrialisation, and reducing operating costs for businesses will support a successful transition to more efficient and cost-effective forms of production. However, we recognise the challenges faced by ceramics producers, and that Government support will be necessary to help the sector.

That is why the ceramics industry support scheme is being introduced: £60 million of this funding will support capital investment from ceramics firms into more efficient and decarbonised means of production, including electrification of relevant processes. This will both attract business investment in efficient new technologies, and enhance our energy security by reducing our reliance on volatile fossil fuels. This fund will be delivered on a competitive basis, with successful companies demonstrating corresponding co-investment of their own. The expectation is that the package will support a small number of high capital projects, likely from larger companies, as well as smaller projects from established trading SMEs.

To ensure that all eligible companies are able to effectively take advantage of this support in practice and invest in the future of this industry, the ceramics industry support scheme will include an additional £60 million to support operational costs for firms that make successful capital bids but demonstrably need additional support to manage the transition.

We will continue to engage with the sector and explore both fiscal and non-fiscal policy options that can continue to support and sustain a modern, thriving ceramics sector. This includes ensuring that our trade remedies regime works appropriately to protect the sector from injury as a result of unfair foreign trading practices. I strongly encourage industry to engage the Trade Remedies Authority and share new evidence to make sure we have the right trade protections in place.

Secondly, the Government are also announcing today the development of a £350 million critical chemical resilience fund to support our chemicals industry. This fund will be available to the UK’s most strategically important chemical producers who underpin our most critical sectors and essential services.

The UK chemicals sector is crucial for UK manufacturing, with chemicals products embedded in the vast majority of manufactured goods. However, like the ceramics sector, the chemicals sector has also faced significant headwinds in recent years with reduced output and recent plant closures raising concerns about its long-term resilience. This Government recognise the scale and depth of those challenges, and we are standing firm, alongside industry, to provide robust support to ensure the sector has a prosperous future in this country.

We have already acted urgently to support and safeguard vital chemical production and jobs at INEOS in Grangemouth, and are restarting production at Ensus in order to protect supply of CO₂.

Today we are taking further action. The fund will seek to address the most acute pressures by offering support to critical chemical companies in key clusters that need help to put themselves on a sustainable footing. This will ensure these companies can continue to supply our essential services, boost the resilience of our supply chains, and protect critical UK sectors like food production, water and healthcare.

This is just a first step, and we will work together with industry to ensure we continue to make the critical inputs our economy requires in the UK. The fund will be developed in collaboration with independent experts and industry representatives, and further details will be communicated in due course.

The Government will continue to work hand-in- hand with industry to ensure broader policy delivers decarbonisation and not deindustrialisation. We are committed to tackling unfair foreign trade practices, and Ministers will urgently convene the chemicals industry to explore potential trade defence action.

The Government are also committed to driving down regulatory costs faced by the industry. We have already cut back the need for UK businesses to buy expensive and unnecessary data, cutting transition costs while maintaining health and environmental protections. We will work with the industry to identify where the UK can go further to reduce regulatory costs and remove duplicative procedures for businesses.

This Government recognise the importance of the chemicals sector, its contribution to society and our economy, and the jobs and communities it supports. The fund supports the delivery of our industrial strategy, which identifies chemicals as a vital foundational sector that underpins the UK’s high-growth industries like defence and advanced manufacturing by producing the materials they all depend on and are essential to many supply chains. Chemicals are also essential to delivering our ambitions in our clean energy mission. Action today will ensure the sector can play its part in strengthening our industrial capability and boosting resilience for the UK’s future.

The Government will continue to work with the sector and experts as the ceramics industry support scheme and critical chemicals resilience fund are being developed, including on eligibility criteria and delivery mechanisms as they are progressed. Further detail will be published in due course, and we are aiming to open both funds to applications later this summer.

The support being announced today is in addition to our support for the chemicals sector through the industrial strategy. In particular, the targeted support to bring down energy costs, through the British industrial competitiveness scheme, will benefit over 10,000 businesses, including many chemical companies, reducing electricity costs by up to £40 per megawatt hour.

This is a long-term industrial intervention designed to address persistent competitiveness challenges facing the chemicals sector. This will help chemical companies remain competitive and resilient through periods of volatility, supporting supply chain security through global supply shocks.

Time and again we have stepped in to support our resilience: from keeping the blast furnaces running at Scunthorpe and restarting production at Ensus to safeguard the UK’s supply of CO₂, to this intervention today. This is the difference an active and strategic state makes.

Together, these measures demonstrate our continued commitment to heavy industry, which underpins our economy, industrial strategy growth sectors, and our national resilience.

[HCWS61]

Backing Business to Create Economic Growth

Peter Kyle Excerpts

Monday 18th May 2026 Commons Chamber

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

Mr Speaker, I heard your call for decency and respect, and I hope those will be the watchwords for today’s debate.

My right hon. Friend the Chancellor is with her G7 colleagues today, so I am grateful for the opportunity to open the King’s Speech debate on backing British business to create economic growth. That is economic growth for a purpose: not simply to exceed the growth rate of other European members of the G7, which we achieved in the last year; not simply to have the highest growth rate in the G7, which we achieved in the last quarter; and not simply to deliver on the Government’s primary mission; but for the purpose of achieving greater social justice for all.

Economic growth is the surest path to higher living standards, improved public services and better quality of life for people up and down our country. We know that economic growth is the catalyst for new opportunities, the pathway to greater prosperity, and the vehicle for greater equality and security for working people. That is why it matters so much.

The growth figures published last week show that, despite the many international headwinds, the UK economy grew by 0.6% in the last quarter—the fastest growth among G7 countries. There is silence from the Opposition Benches. I would have thought that the party that champions Britain and calls for economic growth would be celebrating economic growth when they see it, but no: silence, silence, silence.

The situation is much better than the one we inherited, continuing to exceed the forecast of the doom-and-gloom mongers on the Opposition Benches and in the right-wing media, and even beating market expectations. When the Conservatives were in government, they and their strangely related first cousins, Reform, let down Britain’s economic future. Now, in opposition, they talk down Britain’s economic present. You can bet your bottom dollar that they will do so again today, ignoring the facts.

The facts are that the UK experienced the highest GDP growth among European countries in the G7 last year. Just today, the International Monetary Fund has upgraded the UK growth forecast, with the UK projected to have the fastest cumulative growth among European G7 economies over 2026 and 2027. None of this happened by accident, just like the damage done to the economy by the Tories did not happen by accident.

[Alicia Kearns (Rutland and Stamford) (Con)]

Does the Secretary of State not concede that GDP per capita is down? Can he tell me that a single one of his constituents, apart from those on welfare, feels better off under this Government?

[Peter Kyle]

The whole purpose of the debate is to emphasise that economic growth matters. In the last full year in which the Conservatives were in office, economic growth stood at 0.4%. In the first full year of this Government, it was 1.4%. The hon. Lady should be apologising for the state in which she left the economy, leaving us to pick up the pieces.

This growth has been driven by an activist, interventionist Government who back British business—a Government who are not afraid to roll up their sleeves and make the big calls when big times demand it. From Jaguar Land Rover in the west midlands to Ineos in Scotland, Agratas in the south-west, Tata Steel in Wales, and Harland & Wolff across the United Kingdom, we step in to invest, modernise and protect British industry when necessary. We step back by reducing unnecessary regulation when that is possible, and step up to modernise our critical national economic infrastructure where that is vital: supporting the third runway at Heathrow that the Conservative party curtailed; expanding the Oxford-Cambridge corridor where the Conservative party hesitated; backing Northern Powerhouse Rail which the Conservative party cancelled. This Government have confirmed £45 billion of funding for Northern Powerhouse Rail to upgrade lines east of the Pennines and to bring forward a brand-new route connecting Liverpool and Manchester.

[Harriet Cross (Gordon and Buchan) (Con)]

That was a great list, but what was missing from it was the oil and gas sector, and specifically the £17 billion of investment that was lost as a result of the Government not scrapping the energy profits levy and the £50 billion of investment lost because of their ban on new licences, and other hostile policies. Will the Secretary of State reflect on those, and on the damage that the Government are doing to growth not only in the north-east of Scotland but in the United Kingdom as a whole?

[Peter Kyle]

This Government have invested in industry up and down the country, from Agratas in the south-west, where we are investing in gigafactories, to Ineos in Scotland. We are investing in the industries that are keeping our country going, and we have put growth into the economy.

[Gavin Robinson (Belfast East) (DUP)]

The Secretary of State was kind enough to mention Harland & Wolff. Successive Governments have introduced a number of support measures, and have ensured that that company can thrive by itself. However, in taking at face value what the Secretary of State has said, does he recognise that if this Government continue to refuse to designate Programme Euston a defence project and open it to international tender, not only will they not support British business and yards like Harland & Wolff, but the project will be delayed by three years? If the Secretary of State wants to inject business growth and economic growth, he should designate it a UK defence project, and keep the work and the investment in the UK.

--- Later in debate ---

[Peter Kyle]

The right hon. Gentleman knows full well the commitment that I personally have to Northern Ireland and its economic success. All the issues related to national resilience are things that we have to consider at this moment in time, unlike any other moment in time in peacetime. They are issues that I look at very closely, and in the days and weeks ahead I shall be talking a great deal more about how we can support industry and business across Northern Ireland.

[Jim Shannon (Strangford) (DUP)]

I commend the Secretary of State for what he is saying. I know he is a regular visitor to Northern Ireland because he loves the country, and we appreciate that.

According to the Federation of Small Businesses in Northern Ireland, more than half the enterprises trading between Great Britain and Northern Ireland face severe friction, with more than a third halting trade entirely. Can the Secretary of State explain explicitly how the proposed regulating for growth Bill will help? I know he is committed to it, so let us hear what he has to say.

[Peter Kyle]

I have been aware of those issues from opposition into government. Of course, rebuilding the relationship with the European Union is also partly about smoothing that barrier across the Irish sea, and we will continue to do so.

We are building the critical national economic infrastructure that the Conservative party consistently failed to deliver, on runways, reservoirs and railways. Just as we are modernising Britain’s critical economic infrastructure, we are maximising Britain’s industrial strength by delivering our modern industrial strategy. Written for business with business, our strategy creates the right conditions for business to succeed. Since its publication, we have been tackling the high costs of energy. Our supercharger saves firms hundreds of millions of pounds every year, and our British industrial competitiveness scheme will help more than 10,000 eligible manufacturing businesses, saving them up to £40 per megawatt hour from next April. I am very aware of challenges faced by the ceramics sector; I will meet representatives of the sector tomorrow to discuss how the Government might be able to support it, and I hope to be able to say more about that very soon.

To cut the red tape that is holding back British businesses we are ending mandatory strategic reports for medium-sized companies and ending directors’ reports for businesses of all sizes, saving firms £230 million each and every year. We are stripping out unnecessary rules and regulations. Through the regulating for growth Bill, announced in the King’s Speech, we will create regulatory sandboxes—economic growth laboratories where innovators can trial cutting-edge technologies safely and speedily.

Whereas the Conservatives, with their destructive ideology of deliberate de-industrialisation—from monetarist Thatcherism to Brexit isolationism—drove British manufacturing businesses to the wall and destroyed the jobs that depend on them, this Government are determined to maximise the UK’s competitive advantage, not just through reindustrialisation, though that is necessary, but through new industrialisation in advanced manufacturing, clean energy, artificial intelligence and new technology. That is why we have rolled out new AI growth zones and confirmed the site of the UK’s first small modular reactor—a milestone in the journey to becoming a clean energy superpower.

[Gregory Stafford (Farnham and Bordon) (Con)]

The Secretary of State talks about deregulation, but does he not accept that adding 330 pages-worth of regulation in the Employment Rights Act 2025, at a cost of a billion pounds to the economy, is having the opposite effect? Youth unemployment in my constituency has gone up by 28% in just one year.

[Peter Kyle]

I am grateful to the hon. Gentleman for giving me the opportunity to point out that, in my Department, the overall net regulatory burden is reducing, not expanding. I will not stand in front of the Tories and apologise for giving new rights to workers that are fit for the age we are living in. Over their entire 14 years in office the Tories failed to make sure that people have protections and rights at work that are fit for the age we are living in. We can move forward with growth in the economy that takes forward businesses and the people who work in them. That is to be celebrated, not condemned like the Tories are doing.

[John Glen (Salisbury) (Con)]

The right hon. Gentleman is, quite reasonably, setting out his assertions about where he wants the Government to go, but does he not see the irony? After all the events of last week, the cost of borrowing in the UK is higher than that of many of our competitors, and all business leaders say they feel the instability. The right hon. Gentleman’s words will not ring very true for people who seriously wonder about the Government’s future direction, with putative leadership contenders talking about fundamental changes in direction and different fiscal rules.

[Peter Kyle]

The right hon. Member mentions irony; this is from the party that gave us the Liz Truss mini-Budget, which wreaked havoc on our economy. Mortgage rates went up for every mortgage holder across the country, with inflation peaking at 12%, yet the Conservatives talk about instability. The country still lives with the instability that they wreaked on it.

Our major expansion of DRIVE35 is channelling investment into batteries, electric motors and power electronics—part of the biggest Government investment in the British car industry since the second world war. “Invest”, “modernise” and “protect” are the watchwords for the new industrialisation of Britain through our biggest industries, our biggest sectors and our boldest companies.

[Iqbal Mohamed (Dewsbury and Batley) (Ind)]

The Secretary of State talks about deregulation, but we have seen what that has led to in the finance sector, the banking sector and the water industry: consumers end up paying the price. The Secretary of State also talks about AI; speaking way back in 2014, Stephen Hawking cautioned:

“The development of full artificial intelligence could spell the end of the human race.”

Why do the Government believe that deregulating AI is going to assist their growth mission? It will put consumers’ lives and the human race at risk.

--- Later in debate ---

[Peter Kyle]

The Government are investing in AI infrastructure, but also making sure that the regulatory and legislative landscape is up to date for the time we are living in. The hon. Gentleman wants to turn the clock back. The world is awash with AI technology. We cannot stop it coming to our country, but we can shape how it interacts with our economy and its people. That is why we are investing in the training of 7.5 million people throughout the economy, including a million students, to make sure we can seize the opportunities that AI presents but also protect people from the potential damage it could cause.

Not only are we creating the conditions for new industrialisation, but we are ambitious for the success of Britain’s small businesses. Our “Backing your Business” plan is one of the most generous packages of support rolled out by any Government, with new hospitality zones and reduced red tape for bars and cafés. We have brought in an £11 billion lending package to help small firms to grow internationally and take advantage of the trade agreements we have negotiated with India, South Korea and the United States. This may trigger the Opposition, but we are also going to deepen Britain’s trading relationship with the European Union, Britain’s most significant international marketplace. That is what our European partnership Bill is all about.

[Vikki Slade (Mid Dorset and North Poole) (LD)]

I welcome the deepening of the relationship with the EU and the measures on late payments, but the elephant in the room is that while the jobs tax exists, and the Government do not make the most of business rate changes in retail, hospitality and leisure, the benefit to small businesses is more than outweighed by the extra difficulties they face. Does the Secretary of State accept that there need to be changes on that front, even if we have to wait until the Budget for them?

[Peter Kyle]

Once again, the Lib Dems condemn every fundraising measure we have brought in to invest in our public services and get our country back on its feet, but they never say how they will pay for the alternative. They never say how they will raise the money themselves. I am not going to apologise for any of the measures. I will come in a moment to the investment we have made in small businesses and in hospitality, and I will give way to the hon. Lady again if she wants me to at the time, but will she please say what the alternative is from her perspective? The Lib Dems want to spend all the money in the world but they do not want to tell people how it is.

The lending commitment we have secured with the UK’s five leading banks will support Britain’s small businesses to succeed and prosper. Our business rates support package, worth £4.3 billion, will protect ratepayers from large overnight increases in bills. We have introduced permanently lower multipliers for retail, hospitality and leisure properties. That is worth nearly £1 billion a year and will benefit over three quarters of a million properties.

I know that many businesses, particularly in the hospitality and retail sectors, would like us to go further. I get that. They are impacted by changes in the shopping and social habits of their customers, as well as the financial and geopolitical pressures in the wider economy. We are absolutely aware of and attuned to that. However, the crocodile tears of the Conservatives about these industries are laughable and lamentable. Theirs is the party that urged us to join the costly military action in the Gulf, which will heap further pressure on hospitality and other sectors throughout the economy. It is not our war, but the Conservative party would make British businesses and consumers pay the price.

[Ben Obese-Jecty (Huntingdon) (Con)]

The Secretary of State mentions crocodile tears; what would he say to the hospitality businesses in my constituency that have been impacted by the rise in national insurance contributions, the minimum wage rise and the business rates that he just talked so effusively about? What message would he give to them as they struggle to deal with the outcome of the Budget?

[Peter Kyle]

Unfortunately, none of the Conservative Members was listening to what I just said in outlining the measures we are taking, and the admission that we get it and we are listening. Fundamentally and foundationally, what those businesses need is what every business in this country needs, which is a growing economy. In the last year the Conservatives were in office, growth was 0.4%, but in the first year in office of this Government, it was 1.4%. That is what every business needs across the country, and when it comes to specific sectors at specific moments in time, we are watching and attuned, and I am acting where necessary. When the right hon. Member for Central Devon (Sir Mel Stride) addresses the House, I am certain that on that and so much more he will display all the symptoms of the economic illiteracy and ideological incompetence that for too long have engulfed the Conservative party. By contrast, we are taking practical action to end these conditions.

We are bringing in new measures to tackle late payments. The small business protections (late payments) Bill will give the UK the strongest legal framework in the entire G7. Late payments cost the UK economy £11 billion a year, forcing the closure of 38 businesses every single day. For 14 years it was the same under the Conservatives, and they did nothing. The Bill tackles the scourge of late payments, brings in stronger powers for the Small Business Commissioner, sets out strict maximum payment terms of 60 days, and bans the deduction of retentions in construction contracts. The Federation of Small Businesses has said that tackling late payment is one of the biggest things the Government can do to help small businesses to grow. That is the difference that an activist, interventionist Labour Government can make.

Finally, let me turn to another example of the difference. The ghost of free market Thatcherism still haunts many of the industrial areas of this country. It can be seen in the scars of de-industrialisation still marking too many communities around our country. It is high time to exorcise the ghost of de-industrialisation. When I published the steel strategy last month, I told the House I would never hesitate to fight for British industry in defence of the national interest. The legislation we are bringing forward is proof positive of that commitment.

[Tom Tugendhat (Tonbridge) (Con)]

I am grateful to my right hon. Friend—forgive me, I should not call him that; he will be embarrassed. I am grateful to the right hon. Member for his point about the steel industry. Understandably, he has chosen to support one particular aspect of the industry, the steelmaker, but at the expense of and to the cost of every other part of the industry—the steel consumers. How will he balance that and what provision will he make for those who will see steel prices rises because of his intervention?

[Peter Kyle]

I have committed to invest in, modernise and protect the steel industry where I need to. Those are watchwords that I apply throughout the economy in highly volatile times. We are investing up to £2.5 billion to modernise and transform the steel sector, from blast furnaces to electric arc furnaces—those are the kinds of transformations we need to make. If I had invested that money but not also protected our sector, that would be pouring vast amounts of public money straight down the drain. In certain circumstances I have had to step in and use measures to protect the domestic British industry. I am not introducing measures for any products that are not manufactured in the UK. I am doing so wisely; I am doing so to protect and ensure that we can build and retain a steel industry that is fit for the future and sustainable.

We will move forward and ensure that, in an era of global instability, we have the key aspects of our supply chain that we need for our resilience as a nation—yes, in defence; yes, in industry; and yes, in all the money we are investing in infrastructure. We must reserve those capabilities. I am listening and engaging with all parts of the steel sector, and the manufacturers and businesses that depend on it. I am listening closely to them. If there are any impacts, I will of course engage with them to understand and see how it will be possible, where necessary, to provide support.

[Ayoub Khan (Birmingham Perry Barr) (Ind)]

Will the Secretary of State give way?

[Peter Kyle]

No, I am going to carry on. I appreciate Members’ kind offers to intervene again and again; I look forward to all their speeches.

The Steel Industry (Nationalisation) Bill will give us the authority to bring British Steel into public ownership, not as an ideological exercise but as a practical means of safeguarding the national interest. It will allow us to retain the Scunthorpe plant as a critical piece of our national infrastructure that is essential to British economic resilience. Britain has long been a proud steelmaking nation. Whatever I have to do to make it so, Britain will retain its capacity and capability to manufacture steel. That is my commitment to Members in this House and to the remaining steel communities of our country. The strength of that commitment can be measured in our determination to boost domestic steel production to ensure that 50% of the steel used here is made here.

Britain cannot make its way in the world as a services-only economy. We have to make our way—earn our way—to greater prosperity, equality, security and opportunity. We cannot do that by economic isolationism, neoliberalism, greater protectionism or a command economy. We cannot regulate our way to prosperity. We can achieve it only through practical and pragmatic policies that support British businesses to be profitable, to scale up, to create jobs and to grow. We have to end the outdated free-market ideologies, failed economic theories and siren voices that all but destroyed Britain’s manufacturing base and drove the British public towards Brexit. Britain’s future prosperity can be built only by business success. There is no other way, no shortcut, no easy option and no magic bullet—no matter how attractive and simplistic slogans and superficial soundbites may appear to some.

[George Freeman (Mid Norfolk) (Con)]

The Secretary of State is making a wonderful speech about the 1980s. While I agree with many of his points, the truth is that the country today has come a long way in all sorts of sectors, and I am proud to have done my bit to help that. On regulation, the Secretary of State agrees that leadership on regulating new industries, and having sandboxes and testbeds, is a great UK strength. He also wants us to get closer to the European market; is he worried that if we do, we may end up losing our competitive advantage in a number of areas where we could genuinely attract investment into new industries, such as agri-tech and gene editing?

[Peter Kyle]

To clarify, I am talking about how we recover from the scars of the 1980s, how we learn the lessons, and how we ensure that we never repeat mistakes that cause scars that endure for generations. To answer the hon. Gentleman directly, we will align with the European market only where that is in the national interest.

We cannot turn back the clock to build future success. The partnerships that this Government have built with businesses, local government and trade unions are delivering resilient growth and helping to build a stronger economy. They are building a fairer country, in which wages are up and public borrowing is down. There have been six interest rates cuts and 500,000 children are being lifted out of poverty. The FTSE 100 has reached historic highs, and the UK is raising more venture capital funding this year than France, Germany and the Netherlands combined.

This Government faced enormous challenges on taking office, and the conflict in the Gulf presents us with even greater challenges. Despite that, we are making progress. It will take time for the benefits of progress to be sufficiently seen and properly felt. The recent election results show that. The only sure route to proving the benefits of change is growing the economy, and the only certain way to grow the economy is through British business success. Our task is to create the right conditions for Britain’s businesses to invest, succeed, and win in an increasingly competitive global marketplace. We have made a start, and we will see this through to the finish.

[Mr Speaker]

I call the shadow Chancellor of the Exchequer.

Business and Trade

Peter Kyle Excerpts

Wednesday 13th May 2026 Written Corrections

[Andrew Griffith]

The Government do not create jobs; business does. With unemployment rising, this is the last chance to ask the Secretary of State a question ahead of the start of April when a tsunami of business rate rises will hit. Shops and restaurants will see a 50% increase on average and the business rates of hotels will double. He and I both represent wonderful Sussex constituencies full of hospitality, high street and tourism businesses, but young people need those jobs. For their sake and for others, will he finally postpone his business rate rise?

[Peter Kyle]

I enjoy these exchanges with the shadow Secretary of State. I note that Reform’s self-styled shadow Secretary of State—or, as I call him, the shadowy Secretary of State—is not in his place, despite being just next door in the Tea Room a few minutes ago. I think that speaks volumes.

The shadow Secretary of State knows that the private sector has created 380,000 jobs under this Government. We will continue to grow the economy and the number of people in work, and make sure that people benefit from all the rights we are delivering, which are pro-business and pro-worker. He spent 14 years letting down Britain. Now he has spent 18 months talking it down.

[Official Report, 12 March 2026; Vol. 782, c. 489-490.]

Written correction submitted by the Secretary of State for Business and Trade, the right hon. Member for Hove and Portslade (Peter Kyle):

[Peter Kyle]

The shadow Secretary of State knows that the private sector has created 386,000 jobs under this Government.

[Dr Pinkerton]

Yesterday I met representatives of the British Chambers of Commerce, who relayed the profound concerns of the UK automative industry that it might be excluded from the European Union’s proposed industrial accelerator Act. Nissan and Honda have already broken cover to say that their futures may be uncertain unless they are included in the “made in Europe” rules. What is the Secretary of State doing, with his Front-Bench team and across Government, to ensure that the UK automotive sector is not placed at a competitive disadvantage as a consequence of those measures?

[Peter Kyle]

The hon. Member’s question is incredibly important. He will know that my ministerial team and I have been very active on this issue. Just a couple of weeks ago in Brussels I raised it directly with Commissioners. He will also know that in the proposed Act, which has not yet been introduced, there are potential challenges for the automotive sector. We are working with our EU colleagues to make sure that voices of the business community are being heard loud and clear and that the automotive sector—in which 86% of the components assembled in this country come from EU countries—is respected, valued, and secure in the future.

[Official Report, 12 March 2026; Vol. 782, c. 496.]

Written correction submitted by the Secretary of State for Business and Trade:

[Peter Kyle]

We are working with our EU colleagues to make sure that voices of the business community are being heard loud and clear and that the automotive sector—in which 75% of the components assembled in this country come from EU countries—is respected, valued, and secure in the future.

British Industrial Competitiveness Scheme

Peter Kyle Excerpts

Thursday 16th April 2026 Commons Chamber

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

With permission, I would like to make a statement on industrial energy costs.

When I became Business Secretary, I said that we needed to be bolder, to go further and to move faster to support British enterprise. Today, I want to set out what that means for reduced electricity costs for British industry. The events of recent days and weeks serve to demonstrate the strategic weaknesses and the economic threats inherent in Britain’s over-dependence on the geopolitics of the global oil market. It is high time that Britain gained energy independence by ending that dangerous over-reliance and instead transitioned to become a clean energy superpower.

My right hon. Friend the Secretary of State for Energy Security and Net Zero is overseeing that transition; however, British manufacturing continues to have some of the highest electricity costs in Europe. That undermines our manufacturing base, impacts our manufacturing jobs, and damages the lives and livelihoods of cherished communities across the country. The Government were elected to halt and reverse Britain’s industrial decline. That is why our modern industrial strategy addresses high electricity costs for British businesses.

As part of our British industry supercharger package, I have already increased support for over 550 of the UK’s most energy-intensive businesses—those in our heavy industries. We have increased the network charging compensation scheme discount from 60% to 90%, saving companies up to £420 million a year on their electricity bills, and we have started building the UK’s first small modular reactor in north Wales, laying the groundwork for manufacturers to benefit from reliable, low-carbon electricity.

Last year, I launched the consultation on the British industrial competitiveness scheme, or BICS—our plan to bring industrial electricity costs more closely in line with those in other European economies. I am grateful for the support of the Chancellor in establishing BICS. The response to our consultation, which we are publishing today, shows overwhelming business support for BICS. The scheme has been endorsed by the Confederation of British Industry and the Society of Motor Manufacturers and Traders. Our partners have done more than just support the policy; they have been co-creators, helping us to shape the scope and scale of the scheme. BICS is bigger, bolder and better as a result of their hard work and partnership.

I am announcing today that BICS will benefit 10,000 electricity-intensive manufacturing businesses—those best equipped to drive growth in our economy. Those 10,000 businesses will save up to £40 per megawatt-hour from next year. They will be exempt from paying the indirect costs of three other schemes: the renewables obligation, feed-in tariffs and the capacity market. BICS is designed to support eligible businesses across all regions of Great Britain. The eligible sectors collectively employ 900,000 people, of whom 700,000 live outside London and the south-east. That is a real advantage for working families and communities around the country, and it gives British businesses a real competitive advantage in the global economy. That is the difference that a Labour Government with an activist industrial strategy makes. This is not just about high hopes or warm words; it is real action to reduce energy costs and increase industrial competitiveness.

I pledged not just to be bolder and to go further, but to act faster in the interests of British businesses. Business is keen, as I am sure the whole House is, for the benefits of BICS to take into account the challenging economic reality that we face. I can announce a one-off payment for businesses eligible for BICS, covering the 2026-27 period, and reflecting the support that businesses would have received had the scheme been in place this year. It will be delivered next year, and my Department will set out more details shortly.

Our focus now is on making sure that BICS is as strong and significant as possible, and that it delivers for our car industry, aerospace and defence—the best of British manufacturing. My Department is inviting businesses to help us finalise the operational details of BICS. I invite all companies that can benefit from it to go to the Department for Business and Trade’s website, submit their views, and help us prepare for this final phase together.

This is a major industrial intervention and financial commitment by this Government. I am determined to get it absolutely right from the start. We said that our industrial strategy was never about a single publication or a single moment in time. It is a marked departure from the old economic orthodoxies of Thatcherite de-industrialisation and a failed free market ideology that let whole towns, regions and communities go to the wall. Ours is an activist industrial strategy, supporting British businesses when they need it, intervening when circumstances demand it, and investing in wealth creation and opportunity for all.

We recognise the instability in the global economy. As the Prime Minister has said, the conflict in Iran is not our war, but we must do everything in our power to shield British businesses from the worst effects of it. Businesses are rightly concerned about the impact of the conflict in the middle east. The Chancellor will set out the principles guiding the Government’s thinking as we consider our response.

Today’s announcement of our bigger, bolder scheme is proof positive of our commitment to backing British businesses for the long term. It sits alongside our continued focus on short-term impacts, on which we will not hesitate to act where needed. We will continue using our activist industrial strategy to create the right conditions for British firms to succeed and grow. We do so because we know that when the Government and enterprise work in partnership, we can make Britain stronger, wealthier and more resilient. I commend this statement to the House.

[Madam Deputy Speaker (Caroline Nokes)]

I call the shadow Minister.

[Gareth Davies (Grantham and Bourne) (Con)]

I thank the Secretary of State for advance sight of his statement, and for coming to the House proactively this morning. I refer the House to my entry in the Register of Members’ Financial Interests and my former career in asset management.

I very much welcome the Government’s recognition that industrial energy bills remain incredibly high. This is an issue that businesses across the country have been raising for many months. I have heard what the Secretary of State has to say, and there are a number of areas where I would appreciate further clarity. First, according to the Government’s figures, at least 99% of companies will not benefit from the scheme, even after the announced expansion. Pubs, restaurants, farmers and retailers also face energy cost challenges, and innovative companies such as OpenAI have halted planned multibillion-pound investments in our country. What action will the Government take to address those businesses’ concerns?

Secondly, although businesses are being told today that they will be supported and that their energy bills will be reduced, no relief will actually come their way until next year, so what plan is there to provide a more timely relief for businesses who have to pay their energy bills right now? Finally, I am not clear on how this one-off additional payment next year will be funded. Just this week, the International Monetary Fund has expressed concern about the UK economy, saying that we are the most exposed of all major advanced economies, so can the Secretary of State provide clarity to the markets this morning about how this will be paid for?

High energy costs for British businesses did not start with the conflict in Iran. We all know that energy prices have been far too high for far too long, and we now have the highest industrial energy prices in the whole G7. We should look at the root of the issue at hand: the structural energy challenges that we face as a country. I am pleased that in the regulatory consultation launched today the Government have committed to the removal of carbon price support from April 2028. That is adopting one of the key provisions of the Conservatives’ cheap power plan, so I very much welcome that, but why wait until 2028, and why stop there? The Secretary of State could go further and adopt the plan in full, ending the carbon tax and green levies right now, as well as scrapping the 78% tax on North sea oil and gas companies. Those pragmatic and sensible steps are actionable right now, today. If he does those things, he will have our full support.

[Peter Kyle]

I thank the hon. Gentleman for his support for the scheme. I know it is qualified support, but where that qualified support exists, I am grateful for it. Let us be very clear about the scheme, which I have been designing for quite some time: it is a competitiveness scheme, and it is targeted; it is not a general scheme for the entire economy. It is to increase the competitiveness of businesses, so that they can compete globally and be more profitable domestically. The scheme will be highly impactful for those businesses. Many of them are already profitable and doing great work. Through the scheme, we can turbocharge their ability to be competitive, both domestically and internationally. I have announced a range of other schemes, including the supercharger for energy-intensive sectors, and I have made other interventions, just in the six months that I have been Secretary of State.

The hon. Gentleman was gracious in praising parts of the scheme. He could have also mentioned that the growth figures that came out today show that we approached the challenges in the middle east by busting the forecasts and exceeding expectations for growth. That is good for every single business in the entire country. Growth is the No. 1 mission of the Government, and that is what we have been getting on with. That, of course, means that, going into this challenging period, we have more resilience and success in the British economy.

The hon. Gentleman asked about funding. As I said in my statement, the scheme is being funded through reliefs on three schemes, and through support from the Exchequer. It is fully funded and within the fiscal rules, and that is fully set out. More details will flow as we work with business to ensure that we get the implementation absolutely right.

The hon. Gentleman went on to call for a whole set of measures that he would like to see. I would like him to hold himself to the standard to which he holds me, and to set out how he will fund all the commitments he is making.

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

Let us start with the positives. I am glad that there is now some form of recognition that there is an industrial energy crisis, and that the Secretary of State has brought forward something that helps some sectors.

The bad news for the sector that I and many colleagues in the Chamber represent is that the ceramics sector is not included. There is nothing for tableware or giftware, nothing for ceramic tiles, clay pipes or clay tiles, and nothing for bricks. We have a Government with an objective of building 1.5 million homes, but there is no support for bricks in the scheme, which means that we will have to import bricks from Pakistan, on diesel-chugging super-tankers—bricks made by indentured labour in coal-fired kilns. We will not make them in Walsall, north Staffordshire or your constituency, Madam Deputy Speaker.

The same applies for sanitaryware. This sector has seen exports of half a billion pounds, employs 20,000 people directly across the supply chain, and puts £1 billion back into the UK economy. We have spoken to the Chancellor, to the Secretary of State’s predecessor, to the Energy Secretary, to Ministers across all Departments, and to the Treasury. They promised us help in the Budget, in the industrial strategy, in another Budget, and in the autumn statement. Then we were told, “Wait for BICS.” I suspect that the line from the Secretary of State will be, “The sector is gas-intensive, so wait for the supercharger scheme.” Frankly, that is not good enough. Factories will close and jobs will be lost as a result of this announcement. Bluntly and directly, may I ask the Secretary of State how many job losses and factory closures it will take, and how many brick kilns need to be mothballed, before the Government step in and do something for the ceramics sector? Is it now the Government’s policy objective to oversee the end of UK ceramics production?

[Peter Kyle]

I am grateful to my hon. Friend for his passionate intervention. I came into Parliament 10 years ago, and he came here just a short time afterwards. He has been raising these issues in Parliament for a very long time, about a sector that has long been under stress for various reasons, both global and domestic. I have been determined to ensure that my Department is connected, and as open as possible to listening, and to seeing how we can support the sector. There are monthly meetings with officials. There was a meeting just last week, attended by my hon. Friend, other MPs and industry figures from the sector. I have just discovered that no Secretary of State for Business has visited Stoke to meet ceramic industry figures for over five years. I am willing to do that, and in the coming days, my Department will reach out to the people running those companies to see if my going there, listening to the concerns and seeing what could be done would be of interest to them. If they would like that, I will be there.

I want to stress that my hon. Friend has listed a whole series of very different components of the ceramics industry. It is a diverse industry with diverse inputs. Some of them—I admit, a minority—could be eligible for the BIC scheme that I have announced today. That diversity means that there needs to be a very focused, comprehensive look at the sector. I am willing to go there and meet the industry figures myself.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

[Madam Deputy Speaker (Caroline Nokes)]

Order.

[Peter Kyle]

I could have listened to the hon. Lady for much longer, because she is listing important areas across the sector. I am very aware of the challenges and opportunities in an economy that is full of great enterprise and a lot of highly profitable businesses doing great things with great entrepreneurs. Listening to her, we would think that the economy was not full of people and businesses that are thriving. She only focuses on the challenges.

Let me be clear on how BICS happened. It came about through consultation with the very businesses that the hon. Lady is asking us to listen to. They have been part of designing the system. We will release and implement a targeted scheme that will have maximum benefit. We will announce over the summer an eligibility checker, so that businesses can see their eligibility for the scheme. Of course, as we move forward, we will make payments for costs that may have been incurred this year.

Let me be really clear, however, about how those businesses are working. Most of the businesses—I include the business that was on the Radio 4 “Today” programme this morning; Sharon from Tees Components up in Teesside was on the programme—have entered into a contract with fixed prices for the coming year. Most companies in the categories that we are targeting, which have manufacturing processes in which electricity is a high-component cost, are either hedging, or are in contracts, so that they have some stability into the future. We have designed a scheme that takes that into account, will be there when they need it, and supplies support for costs that they would have had this year.

On CO₂ and the issues that are in the news, six months ago, within days of becoming Secretary of State, I mothballed Ensus up in Teesside—a fantastic company. I have had to un-mothball it, and I did so in the first couple of days of the strikes in Iran to ensure resilience in key parts of our economy. That was leaked; we do not normally comment on leaks, but that is out there now. These are the things that I am doing. I am being bold and creative, and am acting in the interests of the whole of society and the economy to make sure that we have the resilience to carry on doing business, and come out of this with growth in our economy.

[Justin Madders (Ellesmere Port and Bromborough) (Lab)]

We will not prosper as a nation without a lot of support for the manufacturing sector—vital for our security and our resilience—so I welcome today’s statement. I notice with some irony that the fertiliser sector is included. A producer in my constituency closed under the previous Government, and as the Secretary of State has already referred to, several hundred million pounds have already been spent correcting the failure to foresee the risks of such a move.

It is good to see that a number of sectors in my constituency are covered by the scheme, including automotive. The Secretary of State will be aware that the automotive sector faces multifaceted issues, not least on the supply side, but also to do with competition and European proposals. Will he say a little bit more about what else he can do to support the wider challenges facing automotive and manufacturing more generally?

[Peter Kyle]

I am grateful to my hon. Friend for his work when he was in my Department, upon which I seek to continue. He is right to point to the closure of the fertiliser plant in, I believe, 2023. Those are the sorts of things that have stripped out resilience from our economy and society and which I have sought to rebuild in turbulent times. The automotive sector will qualify for the BIC scheme and other high energy- intensive industries outside automotive will also benefit from the supercharger before it does. I regularly meet automotive industry figures, and the Department is deeply engaged with the sector. He will know some of the outcomes of those conversations and that it is a sector that has this Government and me on its side.

[John Cooper (Dumfries and Galloway) (Con)]

The buzzword this morning is “bold”. Yet the reality is that, though this plan might be bolder than what went before, it remains with all the oomph of a 40W bulb. When electricity in Dumfries in my constituency is four times the price in Dumfries in Virginia, in the United States, this country has a major problem with competitiveness— I have a problem saying it. What industry in this country needs is the decommissioning—the unplugging—of the Energy Secretary and his dogmatic carbon taxes, which really lie behind the electricity prices that we face. Today’s announcement does nothing to address that.

[Peter Kyle]

I have done more in six months than his Government did in 14 years. If I am not bold, what the heck was his Government?

[Leigh Ingham (Stafford) (Lab)]

I thank the Minister for coming to the House to give the statement. I also welcome the expansion of the scheme; I know it is desperately needed across our manufacturing sectors. However, as my hon. Friend the Member for Stoke-on-Trent Central (Gareth Snell) has already highlighted, there is a missing sector, in that ceramics does not feature heavily. It is not just pottery—not that potteries are not very important in Staffordshire—but our brick-making factories need support because as a Government we are committed to building homes. We are also committed to buying British, backing British and building British. How does the Secretary of State intend to support a sector that is a linchpin for our wider economy?

[Peter Kyle]

I am grateful for my hon. Friend’s thoughtful words. I can assure her that the ceramics sector and the subsectors she mentions are in my mind. I said in my statement that the Chancellor will set out in the near future the approach that we will take for industries that have been put into distress as a result of the action in the middle east—a war that we did not start, but a war that we are having to respond to. I am happy to stay closely in touch with her and the industries for which she is being a magnificent voice to ensure that we get any response right.

[Dave Doogan (Angus and Perthshire Glens) (SNP)]

We were promised a statement on the British industrial competitiveness scheme; we got the Secretary of State talking about foutering around with the energy bills of less than 1% of UK companies and compensating them to some undetermined extent at some period in the next year. That will come as the coldest of comfort for industries across the UK, such as the ScanStone industrial equipment manufacturers in my constituency, which is already burdened with extraordinary energy bills but is not an “intensive” energy user, so it will get no help from this. It will be similarly encumbered by the same Secretary of State’s quotas on steel imports, which stockholders and manufacturers are already saying will risk output. Will he meet me to discuss my constituents’ concerns about his plans? We support the supporting of British steel in theory, but British manufacturing cannot be put out of work in the process.

[Peter Kyle]

The scheme we have designed is aimed at manufacturing. The figure the hon. Member quotes is for all businesses in the UK, whereas this is one scheme aimed at competitiveness within the manufacturing sector. I hope that when he reflects on his comments, he does not expect us to announce a scheme for every business in all circumstances. That is what Liz Truss did, wasting enormous amounts of money—a third of those billions went into the pockets of high earners. We need to be targeted and growth orientated and support the great businesses out there.

I have invested £2.5 billion into steel. I am modernising steel and protecting it where I have to. I am proud of the strategy we have. There has never been a steel strategy or a quality piece of strategic thinking from the previous Government, which is why the strategy I announced was universally welcomed by the sector.

[David Williams (Stoke-on-Trent North) (Lab)]

I am a proud Stoke-on-Trent MP, and the clue is in the name “the Potteries”—we make pots, we always have done. It is my family’s and our community’s source of pride. Sadly, despite the good engagement I have had with Ministers on the matter, this particular scheme does nothing for ceramics companies in my constituency. I was recently asked a direct question on BBC Radio Stoke, “Do the Government get and understand it?” I do believe that our Government understand the issues faced, but action is not coming forward quickly enough, and our companies are at risk. They are on the brink and need support now. They have incredibly high energy bills and need Government support. If the BICS is not the right scheme for ceramics, we know there is the supercharger scheme. Can I gently encourage my colleagues to please meet us as a matter of urgency because our ceramics sector absolutely needs and deserves our support?

[Peter Kyle]

I thank my hon. Friend for his passionate intervention. I understand the pressing needs and am fully aware of the issues facing Denby, which is partly, I believe, in his constituency. I have been in touch with the regional mayor about it numerous times since that situation unfolded. I certainly wish the workforce well and hope that the interventions and the partnership that the Government have been providing alongside the regional mayor will mean that a buyer can be found, which I am convinced is perfectly possible. When it comes to the long-term regeneration of the Potteries and the ceramics industry, as I have said already, I am willing to meet the industry itself to listen to and learn from their insight and the challenges they face, but also the opportunities they have as we rebuild our economy after the damage caused by the previous Administration and ensure that we get growth back into our economy.

[Richard Tice (Boston and Skegness) (Reform)]

Is that it, Secretary of State? It has taken five months for the Secretary of State to come up with an energy price scheme which he has admitted here in the House today only supports 10,000 businesses. He seems to forget that there are millions of small businesses up and down the country—restaurants, fish and chip shops, pubs, ceramics or farmers. When will the Secretary of State admit that the reality is the reason this country’s economy has no growth is because of high energy prices? When will the Secretary of State do the right thing and scrap net zero so we can bring our electricity prices down?

[Peter Kyle]

I am grateful to the shadowy Business Minister for his greatest hits performance for the House today. He says that supporting 10,000 businesses is nothing. I can tell him that it means a hell of a lot for those businesses getting that support, because it will mean a 25% reduction in their energy costs. It is being paid for, of course, by reducing some of the tariff charges and by some of the other Government schemes that offer relief. It is also paid for partly by the Exchequer, which is funded by people who pay their taxes.

[Catherine Atkinson (Derby North) (Lab)]

I hosted a meeting of small and medium-sized manufacturers in Derby about the challenges of energy costs as part of a manufacturing commission inquiry on SMEs and growth. I welcome the expansion of Government support for British business in energy-intensive sectors by slashing their electricity charges. Can the Business Secretary assure us that the scheme will support smaller manufacturers as well as the largest, and can he tell us more about how this Government will continue to work proactively, hand in hand, with businesses to meet challenges, rather than sitting on their hands like the last Government?

[Peter Kyle]

I am extremely grateful for my hon. Friend’s representations and reflections. I can assure her that the BIC scheme is being calculated on the electricity intensity threshold. It is for those manufacturing businesses that have electricity as a significant part of their costs of doing business. In the summer, we will announce an eligibility checker so that every business can go and check their own eligibility for the scheme going forward. I am keen to stay in touch with her because her area around Derby, of course, is part of the manufacturing renaissance, creating great opportunities for not just her region, but the whole country.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

The Minister’s comments about the potential of energy production in north Wales are to be welcomed because we have been waiting for a very long time. He will also know that energy markets have a direct impact on agriculture, and farmers are facing agflation at 7.6%. That hits Welsh farmers hard because many have to hold back on buying fertiliser until livestock can be turned out, and that is happening now—those prices are hitting them now. They face fertiliser price increases of up to 80% as a direct result of Trump’s warmongering. NFU Cymru leaders met the Secretary of State’s Wales Office colleagues in London this week. Could he tell me whether there was a solid result that farmers can see a benefit from following that meeting?

[Peter Kyle]

I am thankful for the right hon. Member’s acknowledgment of the work we are doing to invest in Wales—not only the small modular reactor, which we are already starting to construct the site for, but the investment in two AI growth zones. This is a Government that, since we came into office, take investment into Wales and the reindustrialisation of Wales incredibly seriously, and both those things are starting now.

On food and agriculture, I spoke just yesterday with the Environment Secretary. We are in touch over these issues and sit in the same committees where we talk about all the specific challenges as we scenario plan for impacts that may or may not result from the conflict in the middle east. That work will continue, and she can rest assured that farmers, alongside other key sectors in our economy, are at the forefront of our mind.

[Ms Polly Billington (East Thanet) (Lab)]

I thank my right hon. Friend for this statement and, importantly, for recognising the energy-intensive industries, especially those that are essential for growth and without which we cannot prosper. It is a start, but can I make a plea for consideration of the sectors of our economy that do not so obviously sit in a globally competitive environment but are still vital for our economy, especially hospitality? Our restaurants and cafés are not able to move elsewhere, but are caught in a situation where there is no current help to support them to shift to clean or cheaper energy so that they can keep doing what they do well: making people happy. Would he agree to meet me and colleagues who are seeking to secure a stable future for this important sector?

[Peter Kyle]

My hon. Friend gives voice to the hospitality sector, and she is absolutely right: the hospitality sector is important for so many reasons. For many people, it is the most interaction they have with the frontline of the economy. It is the place people go for light relief and fun—and, my goodness, we deserve more fun as a country more often. It is also often the first part of the pathway into the economy, because many people’s first job is in hospitality. I recognise that hospitality is an incredibly important part of our economy, for all those reasons.

What the hospitality sector needs first and foremost is economic growth, so that people have more money in their pockets to spend. That is why today’s news that we reached economic growth of 0.5% in the quarter leading up to the end of February is so significant. Embedding the foundations for growth in our economy is what hospitality needs more than anything else. Of course, I meet UKHospitality regularly and I have roundtables with the sector. I represent Hove, which has a thriving hospitality sector, where I meet people on the frontline all the time. I always enjoy engaging with my hon. Friend on these issues too.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State for his statement and for all his hard work, which should be recognised. I welcome the statement, which outlines support for Thales, Spirit AeroSystems, Boeing and Bombardier, which are all big employers in the aerospace and defence sectors in my constituency. However, I also think of manufacturers such as Magellan Aerospace in Greyabbey; T.G. Eakin, a pharmaceutical company in Comber; and Mash Direct, a food and farming business in Ards. I am not sure that they will be eligible for this help. Small businesses are the backbone of the United Kingdom, particularly in Northern Ireland, and they are struggling. What help and hope can the Government give to them?

--- Later in debate ---

[Peter Kyle]

I thank the hon. Gentleman, who is a friend, for his kind words. We have designed a scheme that is for Great Britain, but we have not forgotten Northern Ireland—I do not think he would expect me to forget Northern Ireland in any aspect of my work. We are working with the Northern Ireland Assembly to ensure that we have a scheme that is appropriate and matches the scale of the opportunities that BICS presents to Great Britain, so that all parts of the United Kingdom can benefit in one way or another and the benefits are felt by those fantastic manufacturers he mentioned.

[Ms Julie Minns (Carlisle) (Lab)]

The Carlisle of my childhood was a thriving industrial hub of textiles, engineering and food manufacturing sectors, which were all sadly decimated by successive Conservative Governments. We do, however, remain home to the world’s oldest biscuit factory and the UK’s last tyre manufacturing facility in Pirelli. Can the Secretary of State set out how the scheme announced today will ensure that those businesses that remain in Carlisle and across the UK will continue to be able to export their products abroad?

[Peter Kyle]

My hon. Friend speaks eloquently about the challenges that industry has faced in the de-industrialising period of a previous Conservative Government but also the opportunities that are there for the re-industrialising purpose of this Labour Government. Some of the companies she mentioned are, I imagine, in sectors that BICS will be very meaningfully able to support. I hope those companies will work with my Department to ensure that implementation is as effective as possible, and the eligibility checker, which will go live before too long, will mean that those companies can check their eligibility directly.

In general terms, we are investing in industry in our country. We are working tirelessly with aerospace, automotive and other key parts of the industrial landscape. The fact that Ensus was mothballed and not allowed to go bust shows that we are thinking very deeply and carefully about resilience and economic growth, and not just for today but for the long term.

[Steve Race (Exeter) (Lab)]

The Secretary of State will know that the south-west and Exeter is home to a nationally significant cluster of high-value manufacturing businesses and is identified in the Government’s industrial strategy as a key region for advanced manufacturing, with critical clusters in nuclear, green energy, defence and critical minerals. The last Government had some choice words for business—I will not repeat them here, Madam Deputy Speaker, because they are unparliamentary—but can the Secretary of State set out how this Government are working in partnership with businesses, including those in my region of the south-west, to ensure that they can prosper and succeed into the future?

[Peter Kyle]

I was down in the south-west just last week at Agratas, one of the largest battery production plants for electric vehicles in the whole of Europe. The sheer scale of manufacturing development in the south-west is typical of the renaissance and the capability of the region. The Agratas plant also shows the Government’s securonomics approach in action, with 230 tonnes of British steel being used in the production. From the roof, we can look across and see Europe’s largest nuclear power station being built. It is a real testament to the vibrancy, ambition and capabilities that we see right across the south-west.

[Adam Thompson (Erewash) (Lab)]

Erewash has a proud manufacturing history, from the ironworks, whose grates cover almost every manhole in the country, to our high-end furniture manufacturing industry, whose sofas adorn palaces, to our advanced manufacturing firms and the concrete makers building the tunnels for High Speed 2. As a former manufacturing engineering researcher, I am very proud of this Government’s investment across the advanced manufacturing sector. Can the Secretary of State elaborate on how the action he has announced today will help Erewash’s manufacturers sell their goods to the world?

[Peter Kyle]

My hon. Friend mentioned palaces—is he living in a palace, I wonder? Given the success he has outlined in his career in manufacturing, who knows? I can assure him that manufacturers across his constituency will benefit from the BIC scheme. In the summer, the eligibility checker will confirm which businesses can benefit, but this is about competitiveness. He is describing businesses that are already competitive and will become more competitive on the back of the BIC scheme and therefore be able to export and be a real credit to our country and economy.

[Rosie Wrighting (Kettering) (Lab)]

I start by declaring that before coming to this place, I worked in the head office of a retail business that sells internationally. I know from my experience there and from businesses in Kettering that when British businesses export, they grow, become more productive and create good, well-paid jobs. Can the Secretary of State outline how the measures he has announced today will support businesses to sell their goods around the world?

[Peter Kyle]

I am highly aware of my hon. Friend’s advocacy for those sectors; she is a true credit to them. The BIC scheme is about competitiveness. It has been designed in co-operation and partnership with business. Only one in 10 businesses in our country is exporting, but we have secured great trade deals with South Korea through to India, as well as the economic prosperity deal with America, and of course we are continuously rebuilding the relationship and creating new opportunities with the European Union—the most important trading bloc. I can assure her that the BIC scheme is part of making us even more competitive and more able to prosper on the global trading scene.

[Adam Jogee (Newcastle-under-Lyme) (Lab)]

The font of this statement is so small that it is super difficult to read, which made it even more difficult for me to look for the word “ceramics”, which I have yet to find. The Secretary of State said in his statement that he wants to “move faster” to support British manufacturing. He has heard from a number of my colleagues, and now he will hear from me, that we want to meet him. We have met Ministers—we had an excellent visit with the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Stockton North (Chris McDonald)—but we want to see the Secretary of State, so that we can talk about this scheme and the ceramics industry. We need to have that meeting quickly, because this is about the jobs, livelihoods and future of my community and many others across our country.

[Peter Kyle]

I know that my hon. Friend has had meetings with several of my Ministers, and of course I am always available for him too.

[Sarah Coombes (West Bromwich) (Lab)]

I am very proud to represent a strong industrial constituency with hundreds of excellent manufacturing businesses, and I was very grateful to the Secretary of State for his visit to one of them before Christmas. This Government back British manufacturing, and the BIC scheme will be game changing for the 10,000 businesses that benefit from it. Can the Secretary of State ensure that it is not too onerous to prove eligibility, and that we look after the many excellent businesses in the metal-forming sector in my constituency, which are impacted not just by the historically high industrial prices we inherited, but by the steel safeguarding changes?

[Peter Kyle]

I remember that visit well, and I will reflect on my hon. Friend’s words, as I always do. The eligibility checker will go live in the summer, and the businesses she refers to will be able to check their ability to benefit from what she correctly describes as a highly impactful scheme.

[Chris Vince (Harlow) (Lab/Co-op)]

I thank the Secretary of State for his statement, and I welcome the extension of the BIC scheme and the difference it will make to manufacturing businesses in my constituency. I wish to make a brief representation on behalf of the Lea Valley Growers, who are based in Nazeing in my constituency. As the Secretary of State will know, glasshouse and greenhouse growers use a lot of electricity and gas, but they are not recognised as energy intensive. Will he reflect on what steps the Government can take to support vital food producers such as the Lea Valley Growers, and may I request an urgent meeting to discuss that with him further?

[Peter Kyle]

I am grateful to my hon. Friend for getting the Lea Valley Growers on the record, and I am keen to meet him to hear more about it.

UK Steel Strategy

Peter Kyle 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.

[Dame Harriett Baldwin (West Worcestershire) (Con)]

I thank the Secretary of State for advance sight of his statement. The Conservatives very much believe in a sovereign steel industry, but what we see today is a multibillion-pound shot in the dark, and it heralds the end of primary steel production in the UK. Just to set the record straight, there would no longer be any steel production in Wales without action from the last Government. This steel strategy has no plan to make the industry stand on its own two feet, and it risks a permanent state-funded drain on taxpayers.

British Steel was losing £700,000 a day when the Government took emergency action last year, and now the taxpayer is losing an estimated £1.3 million a day and there is a subsidy of £110,000 per job to keep the Scunthorpe blast furnace operational. This steel strategy does not include any exit strategy, risking a permanent drain on taxpayers, and now the Government are negotiating handing taxpayers’ money to a Chinese business that they said was worth nothing, while hitting British users of steel with a 50% tariff hike. Given that the previous Secretary of State said that British Steel had zero value, will the current Secretary of State confirm whether compensation will be paid to Jingye?

How are these new tariffs going to affect the cost of living for our constituents? How much will the tariffs raise? They represent a massive tax hike on our world-leading automotive, defence and aerospace sectors, which will make building homes, bridges and railways more expensive. Have the Government carried out any impact assessment on the tariffs, and will jobs not be lost in those other sectors?

The Government say in the strategy that electric arc furnaces are the future, but without competitive energy, green steel will simply become no steel. If electric arc furnaces are the future, when will the blast furnaces at Scunthorpe be decommissioned, and how many jobs will be lost in that process? Where will the £2.5 billion go? Is it all going into the Scunthorpe blast furnaces? How is this £2.5 billion spending spree fiscally responsible? What is the Secretary of State cutting to pay for it?

The so-called National Wealth Fund is rapidly become the national slush fund. The shadow Secretary of State for Energy Security and Net Zero, my right hon. Friend the Member for East Surrey (Claire Coutinho), has announced our cheap power plan, which will slash energy bills for businesses and households. The Conservatives will axe the carbon tax, scrap extortionate subsidies for wind and solar, repeal the Climate Change Act 2008, and end the ban on new oil and gas licences to maximise domestic extraction and reduce dependence on foreign energy imports. Could the Secretary of State please copy this approach?

This is a Government who are subsidising decline and reaching for protectionist tariffs. After the botched nationalisation of Scunthorpe and the surrender of the Chagos islands, we can see from this steel strategy that when Labour negotiates, the British taxpayer loses.

[Peter Kyle]

I am glad to see the hon. Lady at the Dispatch Box. It is always an honour to have exchanges with her, as it has been for quite some time.

The hon. Lady mentions Wales, but she seems to have no idea about the breadth and depth of the steel industry across Wales. She seems to think that there is only one steel maker, manufacturer and operator in Wales. There is not. She seems to be forgetting all about 7 Steel in Cardiff. That explains why the Conservatives in government failed to have a strategy and vision for steel and to support the sector because they did not even know who was making steel and where. This Government understand all our steel assets, and we are creating a strategy to make sure that all of them add up to more than the sum of their parts and that we have a domestic industry that is sustainable, secure and growing into the future.

The hon. Lady seems to want to exit from British Steel without any more investment whatsoever. That would be the worst of all worlds. She wants to strand an entire community. We will stand by that community and make sure that the steel industry and sector thrives into the future.

On tariffs, let me just explain to the party that used to be about free and fair trade that free trade depends on fair trade. Fair trade depends on not having overcapacity. We cannot have overcapacity and fair trade. Therefore, we must correct the market and offer protection where overcapacity is in danger of decimating one of our key industries for defence, security and future prosperity.

The worst thing that could be done for the British steel industry is to do nothing. All we have heard from the Conservatives is, “Don’t do any of the things that Labour is doing,” with no alternatives offered whatsoever. They are the “do nothing” party, and that is the worst of all worlds.

[Matt Western (Warwick and Leamington) (Lab)]

I thank my right hon. Friend for his statement. As he says, steel is national security and economic security. Can I just say, it is terrific at long last to hear a Government showing some mettle? [Hon. Members: “Oh.”]

The array of measures in the strategy is impressive, from tariffs to procurement and scrap, but there are some concerns among our precious automotive sector. Could my right hon. Friend outline some detail about how this will relate to EU measures and how it will support UK manufacturers facing “made in Europe” tariffs?

[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.

--- Later in debate ---

[David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)]

In 2024, Labour MPs across south Wales stood on a pledge to “save our steel”. They promised £2.5 billion for the steel industry, and they said that they had a plan. They began by saying that they would publish the steel strategy in spring 2025. Then it was autumn 2025, and now finally it arrives in spring 2026. We still do not know how much of that money will be spent in Wales. Will the Secretary of State confirm that to the House today?

In the meantime, British steel production has continued falling, and thousands of jobs have been lost across south Wales since the blast furnaces were turned off. I am not really sure that Labour understands the damage that its party’s failures are having across south Wales. Wales feels abandoned. Steel is in our blood. It is the backbone of our economy. But we are still losing jobs. Skilled workers such as welders are leaving, and tarmac companies are struggling to make asphalt. Consumer spending is falling. People in south Wales are fed up with broken promises. South Wales was promised that the electric arc furnace would be up and running by 2027, but we are now told that it will be 2028. Can the Secretary of State update the House on that deadline?

We need to see so much more urgency. Wales is desperate for the good jobs that the steel industry can provide. There is still—just about, if the Government move quickly—the opportunity to build a home-grown supply chain for the floating offshore wind sector. The Government have told me that they are not expecting to have that sector going until the mid-2030s. That is far too slow. That lackadaisical approach means that the energy that should be created through offshore wind will not be added to the grid until the mid-2030s. The Government must hurry up and deliver on their promises to south Wales.

[Peter Kyle]

The hon. Gentleman mentioned waiting for the steel strategy. The truth is that the steel sector has been waiting 80 years for a steel strategy, and this is the first time that one has been delivered. I think that showing a little bit of gratitude for what has been delivered today, on behalf of the sectors and businesses that he talked about, would be most welcome. I also point out that the 80 years over which there was no strategy included 2010 to 2015, when his party was in government.

Yesterday I was at Tata in Wales. The management, the ownership, the workers and the unions universally welcome this strategy and the £500 million that has already been put in to help transform the industry. That is the example of how we will move forward—with boldness, creativity and urgency.

[Jessica Morden (Newport East) (Lab)]

This is indeed a welcome and bold steel strategy, and it stands in direct contrast with what happened under the Conservative party, which never had one. I thank all the Ministers involved, the industry and the unions. I declare an interest as a member of Community and GMB. As I am sure Minister will agree, this is a good start, but we should always aspire to be as ambitious as possible for our UK steel industry, our security and our infrastructure, as well as for the dedicated young workforce at Llanwern steelworks and 7 Steel UK. Will the Secretary of State work with industry to incentivise investments in projects that we do not currently make, so that we can reduce even further our reliance on imported steel?

--- Later in debate ---

[Peter Kyle]

I thank my hon. Friend for her thoughtful contribution, which is based on experience. Llanwern has a fierce advocate in my hon. Friend. I hope that she recognises that her campaigning over many years is reflected in the strategy. I can reassure her that this strategy is not the end; it is just the beginning. The investment, transformation and modernisation programme is only just starting.

[Martin Vickers (Brigg and Immingham) (Con)]

Hundreds of my constituents work at the Scunthorpe steelworks, and hundreds more are reliant on the supply chain. They want certainty about their future. Will the Secretary of State give a clear indication of how long he anticipates the existing blast furnaces will be in operation? If the Government’s intention is to build arc furnaces, will they be established in Scunthorpe?

[Peter Kyle]

I am grateful to the hon. Gentleman for his thoughtful intervention. He has campaigned on this issue for a long time. I can reassure him that conversations with the owner are ongoing, and that the £2.5 billion that the Government have committed is for the transformation of the sector for a sustainable future. There will be more domestic demand, we will benefit from efficiencies and economies of scale, and we can start to rebuild and re-industrialise the steel sector. That benefits his community and other steel communities up and down the country.

[Pamela Nash (Motherwell, Wishaw and Carluke) (Lab)]

I declare an interest as a very proud member of Community. I warmly welcome the announcement of this much-needed steel strategy, which promises to deliver across Britain. Dalzell plate mill is physically and emotionally at the heart of Motherwell, and it is the only steelworks operating in Scotland. Can the Secretary of State confirm for my constituents that our plate mill will remain central to the British steel strategy, and will be supported to thrive again?

[Peter Kyle]

I thank my hon. Friend for her campaigning and advocacy. I hope that she recognises it in the strategy that we have announced. Dalzell is central to our defence industry up and down the country, and to the community of Motherwell. I can assure her that it is front and centre of my thinking, as we look to the future in those key sectors.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Father of the House.

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[Peter Kyle]

The right hon. Gentleman mentions Thatcher. I lost my father not so long ago, and have been going through his belongings. I found a letter that my father wrote to Mrs Thatcher when she was the Leader of Opposition in the ’70s. The reply, which came from a private secretary on behalf of the Leader of the Opposition, was signed by one Edward Leigh. I understand his insight into that particular moment in our country’s history, and I am grateful to have this exchange with him over the Dispatch Box. I wish my father was here to see it.

On Scunthorpe and other steel communities, I hope that the right hon. Gentleman has the time to read the strategy. When he has done so, I will make time to sit with him and work through it. He will see that it contains the intent to create sustainable steel production. Our belief and intention is that we will have the domestic capability to produce all grades of steel needed by our economy, in an economically and financially sustainable way. Those are the things that workers in the steel sector, in Scunthorpe and right around the country, need the most.

[Mr Clive Betts (Sheffield South East) (Lab)]

I welcome the strategy. Sheffield’s history is inextricably linked to steel, and we want our future to be linked to steel as well. My right hon. Friend mentioned the excellent work that Forgemasters is doing to provide steel for our nuclear reactors, our nuclear submarines and, hopefully, our civil nuclear program, through small modular reactors. The strategy mentions the procurement of British steel. Will the Secretary of State set out how the Government will ensure that public bodies do procure British steel rather than just saying that they will?

My hon. Friend the Member for Penistone and Stocksbridge (Dr Tidball) has fought so hard for the future of Liberty in the past few months. What would the Secretary of State say to her about Stocksbridge steelworks? Will this deal ensure that the steelworks has a viable future and that jobs are retained for the whole of Sheffield?

[Peter Kyle]

I thank my hon. Friend for his tireless campaigning on these issues over many years. Forgemasters is, of course, important to our defence sector. His constituency also has the capacity to make stainless steel. He gives great voice to those two assets in his community. I hope that he sees much of his campaigning reflected in the strategy, which will give a sustainable long-term future to the industries that he represents and speaks for in the House.

[Chris Law (Dundee Central) (SNP)]

The Secretary of State has made great efforts to make the point that investing in steel production is crucial to the strength of the economy and to our national security, which is true. It is also true that Brexit has been disastrous for our steel industries, as he is aware. It is stark that the UK Government are willing to invest in those critical industries in England and Wales, but have continually failed to do so in Scotland. Despite their election promises to save Grangemouth, it was allowed to close; Mossmorran slammed shut its doors; and Labour’s damaging energy policies have cost 1,000 jobs per month. Will he apologise to the people in the east and north-east of Scotland who feel utterly betrayed and abandoned by the UK Labour Government?

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[Peter Kyle]

As I have mentioned, we have been supporting the Dalzell plant. I also refer the hon. Gentleman to the fact that we have a National Wealth Fund for the entire United Kingdom. Many billions of pounds will now be unleashed to renew our country, including Scotland, which would be bereft of that funding should it be taken out of the United Kingdom and denied access to it.

[Euan Stainbank (Falkirk) (Lab)]

I welcome the Government’s steel strategy. The welcome ambition for the steel sector will be shared by industrial communities across the country, especially in Motherwell. Industrial communities such as those in Falkirk and the Forth valley must see similar ambition. Today is the one-year anniversary of the publication of Project Willow, so will the Secretary of State commit from the Dispatch Box to redoubling his Department’s engagement with prospective investors in Grangemouth, trade unions, the Grangemouth future industry board and local Members, so that the jobs and industry that the project promised our community materialise at pace over the coming years?

[Peter Kyle]

My hon. Friend speaks to many different sectors and industries, all of which we have stepped in to support since coming into office. We are investing in their modernisation and putting them on a sustainable footing for the future. He asks me to redouble my efforts—I have redoubled my efforts every day in this job. He will see from how my Department and I acted when Jaguar Land Rover had its hour of need and when Grangemouth needed support and investment, and from today’s steel strategy, which I announced on a visit to Port Talbot just yesterday, that this is a Government who seek to modernise and to protect where necessary, but always to invest in the future.

[Harriet Cross (Gordon and Buchan) (Con)]

What assessment, if any, has the Department made of the impact that moving from blast furnaces to arc furnaces will have on our virgin steel capabilities? The Minister for Trade, who did the morning round, seemed to accept that it would mean our virgin steel capabilities being undermined.

[Peter Kyle]

I can reassure the hon. Lady that all grades of steel that are needed by the British economy will be available post transition.

[Bill Esterson (Sefton Central) (Lab)]

It really is in the national interest to secure the future of the steel industry in this country. It is extraordinary to hear the opposition to the plan from the Opposition Benches, but perhaps not surprising, given that the shadow Secretary of State, the hon. Member for Arundel and South Downs (Andrew Griffith), was the adviser to the previous Government when they sold the British steelworks at Scunthorpe to Jingye, with all the disastrous consequences. On the subject of energy for Scunthorpe, can the Secretary of State say what is being done to bring forward the date for the electricity connection to the site, which I know has been a significant challenge over many years?

[Peter Kyle]

My hon. Friend will know full well that when it comes to energy, we have announced the supercharger programme. Compensation is now being increased from 60% to 90%, offering relief and injecting competitiveness into the sector at the same time as offering protection. If we had done one without the other, we would, of course, just be pouring money down the drain. I can assure him that we are working with the National Grid and colleagues in the Department for Energy Security and Net Zero to make sure that we get the energy supply needed for the conversion to electric arc furnaces as quickly as possible.

[Greg Smith (Mid Buckinghamshire) (Con)]

Now that the Government have some experience of running a business with British Steel, what assessment has the Secretary of State made of the £37 million cost of the Employment Rights Act 2025 and the national insurance jobs tax increases on the viability of our steel industry?

[Peter Kyle]

I am grateful to the hon. Gentleman for giving himself the opportunity to score an own goal. When we came into office, we inherited a broken economy that was not delivering for working people. Our international relationships were on their knees, public services were stretched to breaking point and our economy simply was not generating income because of the circumstances that we inherited. We have acted to update workers’ rights for the moment we are living in, while getting a grip on the public finances that the previous Government left in utter chaos. Those are the fundamentals that we need moving forward to deal with all the global challenges that will come our way. If we had not got the finances on a stable footing, we would be in a much worse state now that we are facing the challenges that have come our way in recent times.

[Dame Nia Griffith (Llanelli) (Lab)]

I very much welcome the Government’s commitment to supporting our Welsh steel industry and to using much more steel made in the UK, but Llanelli’s Trostre works needs high-quality steel to make the steel packaging products it produces. That steel used to come from Port Talbot’s blast furnaces. Can the Minister tell us more about what he is doing to secure supplies of appropriate scrap metal for the electric arc furnace, and to stimulate research to ensure that the electric arc furnace can produce steel of the quality that Trostre needs?

[Peter Kyle]

My hon. Friend has been speaking about this issue for a long time. In the run-up to the transition period for electric arc furnaces, I assure her that we have a scrap working group, which is working to identify the sources of scrap metal that will be required. Just yesterday in Port Talbot, I was talking with the management, the workers and the unions, and I saw the infrastructure being built to get scrap from across the United Kingdom to where it needs to be on an enormous scale.

[Richard Tice (Boston and Skegness) (Reform)]

Well, at least this Government have a steel strategy, unlike the previous Administration. Credit where credit is due: they are right to impose tariffs and quotas. But that is as far as it goes, because otherwise it is visionless and hamstrung by net stupid zero. We have the absurd situation in which the public sector is buying tens of thousands of tonnes of steel from China, rather than from Scunthorpe and British Steel. This is a complete betrayal of thousands of workers in Scunthorpe. There is no vision. Will the Secretary of State confirm when the blast furnaces will be closed at Scunthorpe—Reform would renew and replace them—and will he guarantee that when the electric arc furnace in Port Talbot is built, it will definitely open for business?

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[Peter Kyle]

I have not yet had the opportunity to welcome the self-appointed shadow shadow—or, as I say, shadowy—Secretary of State to his position. Despite the investment and the protections we are putting in, and despite the modernisations, which he recognises are all good, his point seems to be that it is not quite visionary enough. However, he is not able to point to a vision for a more comprehensive future for the steel industry. He also seems to think that electric arc furnaces are woke. Let me say that there is nothing woke about an electric arc furnace, which, when rolled out in the transition, will make us a market leader globally, which is what the industry itself—the British domestic suppliers and those who are demanding that steel is required into the future—is calling for. I can assure him that we are on the side of the industry and its vision. We are matching its ambition and its potential for the future. He wants to cast us back into the past.

[Nick Smith (Blaenau Gwent and Rhymney) (Lab)]

May I say how proud I am that my birth certificate says, “Father’s occupation: labourer in the steelworks”? This strategy is a shot in the arm for steelmakers across the UK; it is in stark contrast to the failures of the last Tory Governments. But can the Secretary of State say more about the infrastructure projects and plans to refine the public procurement notice for steel? What will that mean in practice for jobs in our communities?

[Peter Kyle]

In the many years I have observed my hon. Friend contributing to these debates, he has always been thoughtful and powerfully on the side of the steel sector. I can reassure him that the Government are investing in infrastructure on an unprecedented peacetime scale. The new runways and the 1.5 million homes that will be built as a result of this Government, and the building out between Oxford and Cambridge, to name a few, will all require enormous amounts of steel. This Government’s policy is to increase the supply of domestic steel from 30% to 50% of the requirement. We will use all the powers we have in policy and incentives to ensure that British steel producers benefit from all these opportunities.

[Ben Lake (Ceredigion Preseli) (PC)]

I welcome today’s statement on the introduction of a strategy for such a critical industry, and particularly commend the Government for the emphasis they place on the importance of steel sites across Wales. With that in mind, can the Secretary of State offer greater detail on the types of investment he envisages in the strategy to go into sites in Wales, and the rough timescale over which we can expect to receive it?

[Peter Kyle]

The hon. Member will notice from the steel strategy, which sits alongside the industrial strategy, that place-based investment is incredibly important to this Government. Yesterday, I was in Port Talbot with the First Minister for Wales. When two Governments are aligned in trying to get investment into parts of the country—when two Labour Governments work hand in hand—they deliver for the people of Wales and for people across the United Kingdom.

[Mr Alex Barros-Curtis (Cardiff West) (Lab)]

I refer proudly to my membership of GMB and Unite. I welcome this brilliant announcement and especially the backing of Welsh steel, because Welsh steelmaking is expected to account for half of all future UK steelmaking. As the Secretary of State mentioned, I was proud to recently visit with my Front-Bench colleagues 7 Steel in Cardiff, where we already have an electric arc furnace. Does the Secretary of State agree that the steel strategy from this Labour Government marks a welcome departure after the years of failure to have a strategy by Conservative Governments—and, let us not forget, the coalition Government—who repeatedly left this vital industry on the brink of collapse?

[Peter Kyle]

My hon. Friend’s analysis is absolutely correct, and he has been a tireless advocate ever since he joined this place. It is correct to say that we have invested and are investing in steel in Wales, but we are also investing in modernising the economy and infrastructure of Wales. The creation of two AI growth zones sits alongside the work we are doing on steel and other areas of infrastructure in Wales. Again, it demonstrates two Labour Governments working together for the benefit of the people of Wales. It works, and he is part of that, for which I am grateful.

[Luke Myer (Middlesbrough South and East Cleveland) (Lab)]

I draw the House’s attention to my entry in the Register of Members’ Financial Interests. What a contrast there is between the Government of just over a decade ago, who ripped the heart out of my region, and this Government, who finally have a strategy after many decades. I welcome it, but what is more, so does the industry—I spoke to those in the industry this week, and they strongly welcome the measures, particularly on procurement and trade. This is a Government on the side of British steelworkers.

One of the biggest issues affecting the industry is, of course, energy. I hear what the Secretary of State says about the supercharger, but even with that, there will still be an energy price gap with many of our competitors. What more can we do to ensure that we reduce these gaps for our industry and protect jobs years into the future?

[Peter Kyle]

The workers at Skinningrove have a true advocate in this place in my hon. Friend. I can reassure him that the work we have done on the supercharger will make a tangible difference to the workers and the sustainability of that plant. I can also reassure him that this is a Government who act when we have to. We are in constant touch with the steel industry. We are on its side. We are working with it to create a sustainable industry into the future.

UK Steel Strategy

Peter Kyle Excerpts

Thursday 19th March 2026 Written Statements

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

The Government are today announcing a comprehensive set of measures to secure and enhance the long-term future of UK steel-making, strengthen national security and position the UK as a world leader in clean, modern steel production.

Steel production has played a central role in the UK’s history and is essential to our economic success and national security. It underpins key growth-driving sectors of the industrial strategy, including advanced manufacturing, clean energy, defence and digital technologies. The sector supports thousands of skilled jobs and remains integral to communities across the country. It is a bedrock of our economic resilience and national security.

Despite its strategic importance, the UK steel sector has faced 20 years of decline. High operating costs and global over-capacity have significantly affected the competitiveness and viability of the UK steel industry, and manufacturers have increasingly turned to imported steel at artificially low prices. This situation has contributed to reduced investment, diminished capabilities and severe impacts on steel-making communities. Crude steel production has fallen by more than 50% over the last decade. Successive Governments have intervened to support individual companies, but have not addressed the underlying causes of decline across the sector, or fostered broader, long-term conditions for a sustainable domestic industry.

While the sector faces challenges, this Government do not accept that decline is inevitable. That is why we have today published our new steel strategy, which sets out a comprehensive plan to reverse historical trends and build a strong and resilient industry, supported by up to £2.5 billion of Government investment, in addition to £500 million for Tata Steel.

A key part of the strategy is the introduction of a new trade measure to ensure the future of domestic steel production in the face of global over-capacity, given the sector’s central role in critical national infrastructure, defence, and economic resilience. From 1 July 2026, overall quota levels for steel imports will be significantly reduced by 60% compared with the safeguard, and steel coming into the UK above these levels will be subject to a 50% tariff. This measure will apply to imported steel products that can be made in the UK.

A stable, thriving steel sector will provide a secure supply of high-quality steel to downstream customers. The tariff will apply only once import quotas have been met, which will facilitate continued imports for industries that rely on them, including those in the automotive, construction and defence sectors.

Following engagement with downstream importers, we are exploring a transitional arrangement under which the new tariff would not apply to goods under contract agreed before 14 March and imported between 1 July and 30 September 2026. We are finalising the details to ensure that the agreement provides genuine support to firms facing unexpected costs, while still protecting the UK market from excessive imports. Our quotas will be administered on a quarterly basis, with roll-over between quarters within the same accounting year. We will also review the measure after 12 months to ensure that it remains effective.

Alongside the new trade measure being announced today, the Government will also launch a process at the World Trade Organisation under article 28 of the general agreement on tariffs trade to negotiate and agree an increase in the UK’s maximum most favoured nation steel tariffs to 50%. This will create the space for applied MFN tariffs to be increased in the future, protecting domestic industry in the long run from the impacts of global over-capacity.

The Government’s approach is the result of extensive engagement with the Steel Council, trade unions and businesses, and with responses to the recent call for evidence on supply chain needs. It aligns with the Government industrial strategy and trade strategy, which supports resilient supply chains and secure growth in critical sectors.

The UK is not alone in taking steps to improve the security and resilience of the steel sector. Our neighbours and allies face the same challenges from over-capacity, which is challenging global markets. The European Union announced its own measure on steel trade last year. We are acting on the basis of shared concerns. That is why we are focused on engaging constructively with the EU, with whom our supply chains are so connected.

This trade measure, alongside our wider strategy, will reinforce the UK steel sector’s resilience and help us meet our ambition for domestic production to meet 40% to 50% of the UK’s steel demand. Achieving these goals will also require investment in the sector’s future. Building on the direct support the Government have provided so far, the National Wealth Fund will be the main mechanism for providing further financing for investment in the steel sector. The NWF is actively seeking engagement with steel firms and is looking to crowd in significant private capital to support the sector.

The Government have reformed the clean industry bonus to create new incentives for manufacturers to invest in UK steel in domestic wind turbines and wind farms. In parallel, electric arc furnace capacity will be expanded, recognising that stabilisation of the sector will mean a transition to more highly productive, decarbonised steel-making. As we see at Sheffield Forgemasters, electric arc furnaces have the technical capability we need to produce steel at the highest of standards, including for safety-critical sectors such as nuclear, aerospace and defence.

Blast furnace capacity will continue to be required in the immediate term, and the Government will therefore pursue a managed transition to ensure security of supply.

The strategy also places renewed emphasis on recycling. Greater use of domestically available scrap steel is a major opportunity for growth, and the Government, through the creation of a new working group, is engaging with industry, academia and other stakeholders to ensure this potential is fully realised. We are announcing a new innovation working group, chaired by an expert to increase collaboration between our research community and industry. It will develop a clear direction for steel research and development. Through the Steel Council, we will foster collaboration between industry, devolved Governments and wider stakeholders to address the sector’s workforce requirements.

To improve the business environment, the Government are addressing the long-standing challenge of high energy costs as set out in the industrial strategy. Under our clean energy superpower mission, we will increase our energy security and reduce electricity bills by investing in clean energy and strengthening our connections to the EU energy market. While we will focus on translating the cheaper wholesale costs of clean power into lower bills, we also recognise the need to act quickly to support sectors with high growth potential and significant exposure to high electricity prices.

The British industry supercharger policy has already delivered substantial savings for steel-making firms, and further benefits will follow from forthcoming changes to the network charging compensation scheme; the British industrial competitiveness scheme, which could save eligible firms up to £40 per megawatt hour from April 2027; and continued support for the energy intensive industries compensation scheme, announced in the Budget, which has delivered financial support for steel businesses since 2013, and will continue to deliver electricity costs support for steel companies. These measures help reduce electricity costs for steel companies to make them more competitive.

The Government recognise that public investment alone cannot deliver the scale of renewal required. New private sector investment is essential to increasing capacity and capability and stabilising the sector. Britain welcomes new entrants to the market, supported by Government finance where appropriate. We will continue to work closely with the devolved Governments in Wales and Scotland to attract further investment.

The steel strategy sets out a vision of Government, industry and communities working together to make the UK steel sector more attractive to investors, more financially stable and more internationally competitive. This vision is already being realised. UK Export Finance has today signed a major financing agreement with Nigeria for the refurbishment of two major ports. Under this arrangement, British Steel Ltd will supply 120,000 tonnes of steel billets, a contract worth £70 million and the largest British steel order that UKEF has ever backed.

The steel strategy will support the country’s broader ambitions in infrastructure, defence and technology. Steel produced in the UK will be required for the delivery of 1.5 million new homes, and for the approved third runway at Heathrow, which alone will require 400,000 tonnes of steel. Steel made in the UK will be key to delivering the AUKUS submarine programme, a trilateral security partnership between Australia, the UK and the United States. The strategy will also support new data centres and gigafactories, including the Agratas facility in Oxfordshire, where 23,000 tonnes of steel, fully sourced from the UK, have already been used in construction.

The Government are taking action to secure the future of the UK steel industry, recognising its importance to the nation’s economic and national security. Britain’s industrial past was built on steel, and our future will be too.

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