Steel Industry (Nationalisation) Bill

Debate between Sarah Olney and Chris McDonald

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

[Chris McDonald]

I agree that procurement has an important role to play here. I am sure that my hon. Friend will have welcomed recent changes in guidance by the Cabinet Office to ensure that British steel producers are well placed to win these orders, as well as in the areas of renewable energy, where the Government are awarding significant contracts, and nuclear power, where we are again endeavouring to ensure that British companies are well placed to win those contracts.

I turn to amendment 22 and new clauses 4 and 12, which would impose statutory caps on compensation and financial assistance. I have already addressed compensation, and financial assistance is somewhat similar in that applying a cap on the basis of the number of employees, or indeed a fixed cap of any kind, would ultimately restrain the Government’s ability to respond effectively to circumstances as they evolve.

I believe that could fundamentally undermine the purpose of the Bill, which is for the Government, with the will of Parliament, to be ready to respond to circumstances such that we are not required to fly back from wherever we are in the world at incredibly short notice, and prolong uncertainty among the workforce and suppliers. We do not want to create any legal uncertainty, uncertainty in the supply chain or commercial uncertainty. That is why it is important to have this level of flexibility.

The Bill has proportionate and robust transparency and accountability mechanisms for the provision of financial assistance. For instance, clause 59 requires the Secretary of State to report to Parliament at 12-monthly intervals, and funding will be subject to the established framework for managing public money, including through Treasury approval processes.

New clause 6 would place on the Secretary of State a requirement to put forward a proposal to Parliament about providing financial assistance if a Select Committee were to make recommendations on that. Again, that is not realistic. Given that financial support would be required immediately following a transfer, there would not be time for that level of parliamentary scrutiny. Important though scrutiny is—I certainly welcome the investigation into steel currently being carried out by the Public Accounts Committee—we have to be realistic about the point at which it is possible to apply scrutiny.

New clause 7 would require impact assessments to be published before exercising the Bill’s provisions. Again, the issue is essentially about pace among other things. We believe that impact assessments are crucial to show the impact of Government intervention, and the Government are committed to operating in line with our better regulation framework requirements. We do not want to introduce any further legal uncertainty, so we reject the new clause.

A number of colleagues mentioned new clause 9, so it is important to address some of the issues raised around that. Fundamentally, the new clause would not be at all helpful; I will give an example as to why. There is an assumption in the new clause that if the Government were to nationalise a business under the Bill, the best approach would be to treat it like a hot potato and immediately throw it away. We have seen the impact of that.

We heard yesterday about the nationalisation—briefly—of British Steel by the previous Conservative Government: they spent £750,000, made no investment in the business and immediately sold it on to a company called Greybull Capital, whose track record was failure at Monarch airlines, failure at Comet electrical stores and failure at Rileys snooker halls. If you cannot run a snooker hall, you definitely cannot run a steel company.

This is where the hon. Member for Boston and Skegness (Richard Tice) and I have some points of agreement: there is more than one way to bring investment into a business other than selling it to an overseas investor. We could have debt and equity finance, and the Conservative party used to be keen on mass public ownership via a listing on the London Stock Exchange. There are many different ways in which we can bring private sector investment into a business and resolve issues around ownership.

Of course, it is intolerable to work in a business that is constantly up for sale—I have been in that position myself—as businesses do not perform in that position. A decision to sell a business is a decision made at a point in time, not an ongoing process. The Government therefore reject that new clause.

Given that I have detained the Committee considerably over the last couple of days, I have no wish to do so any further. I hope that, having responded as fully as I can to the amendments and new clauses, the Members who tabled them might feel sufficiently reassured not to press them and therefore save the House their consideration. I fully and sincerely thank everyone for their incredible participation in the debate, for the marvellous speeches that we have heard today, and for their strong interest in the steel industry that I have worked in and which I continue to champion in this House.

[Sarah Olney]

I beg to ask leave to withdraw amendment 7.

Amendment, by leave, withdrawn.

Clauses 52 to 57 ordered to stand part of the Bill.

Clause 58

Financial assistance

Amendment proposed: 20, page 39, line 7, at end insert—

“(1A) The Secretary of State may only provide financial assistance under this section if they are satisfied that financial assistance will secure value for money.”—(Dame Harriett Baldwin.)

Question put, That the amendment be made.

Oral Answers to Questions

Debate between Sarah Olney and Chris McDonald

Thursday 21st May 2026 Commons Chamber

[Sarah Olney (Richmond Park) (LD)]

The Government announced their intention in the industrial strategy to use their procurement power to shape markets for innovation in the longer term. Tech start-ups in my constituency complain that the process of getting Government contracts is slow, risk-averse and structurally biased in its financial viability tests and paperwork requirements towards incumbents and US suppliers. As one of them put it to me, no one gets sacked for buying IBM. That surely prevents the Government from achieving their goal of greater innovation. What conversations is the Minister having with his Cabinet Office counterparts to ensure that our ambitious home-grown small and medium-sized enterprises are not being squeezed out of the competition for public contracts that could provide these firms with valuable growth opportunities and the innovation that our economy and public services so badly need?

[Chris McDonald]

The hon. Member raises an extremely important point: Government procurement can, of course, be an important lever for growing our economy. Whereas previous Governments used the fig leaf of being in the EU as an excuse to buy things from overseas simply because they were a penny cheaper, this Government are committed to ensuring that as much as possible of UK taxpayers’ money is spent in the UK.

The hon. Member asks what discussions I am having with Cabinet Office colleagues. I am having discussions with colleagues in the Cabinet Office, the Home Department, the Ministry of Defence and across Government, because there is a commitment among Ministers to ensure that Government procurement is targeted at British companies. My right hon. Friend the Secretary of State has made a strong commitment to reduce regulation and bureaucracy, so we can ensure that these contracts are awarded more efficiently and more easily to small businesses in the UK.

Oral Answers to Questions

Debate between Sarah Olney and Chris McDonald

Tuesday 10th February 2026 Commons Chamber

[Sarah Olney (Richmond Park) (LD)]

5. If he will update the UK emissions trading scheme to reflect the carbon abatement costs of major projects.

[The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)]

The carbon pricing emissions trading scheme is set by the market, rather than the Government. The price is effective at driving investment in carbon abatement measures, but it is for individual operators to decide whether the costs of abatement in a project are effective for them.

[Sarah Olney]

Last week the Government updated their carbon values to reflect their latest net zero emission target, but the UK emissions trading scheme does not take into account the updated figures. In 2021, it was predicted that carbon abatement for a third runway at Heathrow would cost £100 million, and costs will have only risen since. According to the emissions trading scheme, just 15% of the clean-up costs of expansion will be covered by Heathrow; the rest will fall on the taxpayer. Will the Minister update the UK emissions trading scheme to reflect the carbon abatement costs of major projects such as Heathrow expansion, so that the taxpayer can understand how much they will have to pay for a third runway?

INEOS Chemicals: Grangemouth

Debate between Sarah Olney and Chris McDonald

Wednesday 17th December 2025 Commons Chamber

[Sarah Olney (Richmond Park) (LD)]

I thank the Minister for advance sight of the statement. I welcome the Government’s announcement that they are stepping in to offer support and protect jobs in this vital industry. We have a duty to safeguard our national security and economic prosperity, and to ensure a fair transition to clean energy. This statement is a step in that direction.

We have long been champions of British industry. We are proud of the industrial policies that we introduced in government, and we must never return to the neglect we saw under the Conservatives, who scrapped our industrial strategy. Having said that, we need to see a far more cohesive plan from this Government to support British business, including our chemicals sector.

High energy costs are a fundamental challenge. The industrial competitiveness scheme will support the 7,000 most energy-intensive firms, but it will not launch until April 2027. Will the Government confirm whether the Grangemouth plant will be included in the scheme? Do Ministers acknowledge that if the scheme had been in place earlier, the situation might have been avoided? Does the Minister agree that we need a long-term plan to slash energy costs for households and businesses alike by seriously investing in renewables and decoupling electricity from gas prices?

Finally, I must press the Minister on another huge added cost for which the Government are responsible, which is of course the national insurance increase. Will he tell the House what is the tax hit imposed on the Grangemouth plant through the national insurance hike since last year’s Budget? Is it greater than the £50 million Government grant handed to Ineos today?

[Chris McDonald]

I thank the hon. Member for recognising the importance of both the site and the Government’s intervention. She mentioned the £50 million grant. It is important that hon. Members look at that in the context of the total package: a grant and an investment from the owner of the business—and, as the owner of the business said today, an agreement in principle for a profit-sharing arrangement.

That points to the hon. Member’s other question about the detail of the industrial strategy. This industrial strategy is a significant break with the past. It is not about last-minute interventions, which is what the previous Conservative Government did or did not do, depending on how the mood took them. It is about a serious partnership and engagement between Government and industry to ensure that we have sustainable industry in the UK.

The hon. Member asked me about energy costs. I mentioned earlier the relative position on energy costs. Of course, we are doing more on that, and I intend to do much more. In answer to her question on whether it would have helped had the scheme been in place earlier, clearly it would have helped if there had been a Labour Government in place earlier. That would be my advice: always vote Labour.