Steel Industry

Sarah Champion Excerpts

Wednesday 14th January 2015 Commons Chamber

[Sarah Champion (Rotherham) (Lab)]

UK steel is critical to our economy. It employs more than 330,000 workers across the country, people whose wages are then invested in their local communities and in taxes to the Government. In 2012, UK steel’s contribution to the economy was worth more than £45 billion. Clearly, UK steel reaps strong benefits for the whole economy.

Steel has a strong history in Yorkshire and the Humber, and currently employs almost 7,500 people in the region. I want to compete with my hon. Friend the Member for Penistone and Stocksbridge (Angela Smith). The specialist steel contribution of my constituency means that every five seconds an aircraft reliant on Rotherham steel takes off or lands somewhere in the world.

The impact and reach of the UK steel industry are vast, and it is our duty to ensure they remains so. However, keeping the industry strong means creating a level playing field, a situation that does not exist at the moment. Our steel firms are severely disadvantaged both by business rates and energy costs. On energy in particular, prices paid by UK steel firms are more than double those paid in competitor countries such as Norway and Germany. High energy prices, combined with business rates five to 10 times higher than in other European countries, mean that UK steel finds itself at a severe disadvantage when pitched against manufacturers in the EU and internationally. The Chancellor proposed a review of business rates in the autumn statement. I welcome that, but we need action more quickly than the promised 2016 report. UK steel needs to be competitive now.

We already face the threat of a significant loss to the industry, with the sale of Tata Steel’s long products division. I, and a number of my constituents, have expressed our strong concern about that. I ask that the Government strongly consider giving a commitment to work with Syndex and the unions to look at alternatives to the sale.

In Rotherham, the same failure to consult has been replicated locally in the move of 135 research and development jobs to Warwick. The R and D staff in Rotherham are world-class experts dedicated to working in this specialist field. Tata Steel is asking to move them, uprooting them and their families, to Warwick or they potentially lose their jobs. That seems deeply unfair. The relocation is a lose-lose situation: Tata could lose skilled workers and those workers could lose their livelihoods. I ask today that the Government intervene to support Rotherham’s R and D team by working closely with Tata Steel and the unions to establish an alternative solution. It is not right that such a concentration of highly skilled workers is lost, particularly, as the Secretary of State said, as the advanced manufacturing centre’s catapult scheme and the steel proving factory are both in Rotherham.

Ultimately, we want steel to thrive in the UK, because it is a critical part of our supply chain, but the future sustainability of the industry will be under threat, unless the Government act quickly and strategically to safeguard UK steel. The industry needs a Government willing to act now on energy tariffs and business rates. We need a Government who will proudly fly the flag for UK steel across the world. We need a Government who not only commit to supporting the industry, but follow up with action. The UK steel industry can have a strong future, but only if we act now to protect it.