UK Steel Industry

Stephen Kinnock Excerpts

Tuesday 12th April 2016 Commons Chamber

[Stephen Kinnock (Aberavon) (Lab)]

I wish to start today by thanking both the shadow Secretary of State, my hon. Friend the Member for Wallasey (Ms Eagle), for securing this debate, and you, Mr Speaker, for granting it.

I also thank the Secretary of State for his statements yesterday and today and for attending the special meeting of the all-party group on steel yesterday afternoon. However, although I am grateful to him, l regret to say that those meetings and statements have done little to address investor and customer confidence, which are of paramount importance at this time. Alongside the efforts the Government need to make to find and support a commercial operator, the priority at the moment should be securing the order book.

Erosion of the customer base is the most pressing issue facing the British steel industry. If the customer base goes, it will not come back. Unless the order book is secured, it does not matter what else happens. No one will buy a business if it has no customers—it is as simple as that. That is why I was so deeply concerned by the Secretary of State’s response to my question at the APPG yesterday, when I asked him to outline the specific actions he was taking in that regard. He said that he would be happy to engage with customers as and when they approached him. That is simply not good enough. The Secretary of State should be on the phone. He should be reaching out to the chief executive officers of Honda, Nissan, Jaguar Land Rover and others, making it clear that production of the world class steel that they have come to expect and to rely on will continue, come hell or high water.

This House and every steelworker in the country now looks to the Secretary of State to take action. He should set out precisely, and in specific detail, the representations that he intends to make in the coming days and weeks to the companies that comprise the customer base, which is the lifeblood of the British steel industry.

[Sajid Javid]

The hon. Gentleman makes an important point about the companies in the supply chain and the customers, and he is absolutely right to do so. What I have said to him and to others is that we are engaging with many of those organisations—I know that the Secretary of State for Wales is, too—but what he must understand is that much of this is commercially sensitive. Many of those suppliers would not like us to discuss who we are talking to and what their concerns are. I hope that he understands that it would be quite improper for us to divulge that information.

[Stephen Kinnock]

I fear that the Secretary of State has misunderstood me. I am simply saying that it is very important to be on the telephone to the customer base. [Interruption.] We on the Opposition Benches and the steelworkers of this country would like a little bit more detail. [Interruption.] Ministers must forgive us for being sceptical about what they are doing or for thinking that there may be a lack of action.

The Secretary of State talked about co-investment yesterday. Although I welcome the fact that he has belatedly converted to the fact that the Government and industry can work in partnership, I am not entirely sure what co-investment means in his terms. I agree with him that nationalisation is not a long-term solution, but what customers need to know is that, come what may, they will still be able to purchase strip products from the Tata sites. Such security can be offered only if the Government commit to keep all options on the table. Can the Secretary of State make such an assurance to the House?

The men and women working in steel and connected industries across this country are among the most highly skilled and effective people in Britain. The Port Talbot workers are already turning the business around, with improved productivity leading to tangible improvements in business and financial performance. Their skill and dedication is matched by that of Roy Rickhuss, the general secretary of Community, who was even praised by the Secretary of State yesterday.

The surprise announcement that we really needed yesterday was not that of a Conservative praising a trade union leader, but that of the Government announcing an end to their laissez-faire attitude. What we needed from the Government was a list of all the discussions that they have had with the customer base, but what we got was yet more prevarication and procrastination. What we needed from the Government was the announcement that all options were on the table, but what we got was ambiguity. What we needed from the Government was the announcement that they would put down their pom-poms and give up their role as China’s chief cheerleader in Europe; that they would end their championing of market economy status for China; and that they would end their campaign against trade defence reform, but what we got was more of the same.

Yesterday, the Secretary of State only confirmed something that we already knew—that the Government’s approach has been characterised by a dangerous combination of indifference, incompetence and a rolling out of the red carpet for Beijing.

[Andy McDonald]

Was my hon. Friend as surprised as I was to hear that, when the Chancellor went to China, he invited it to take part in the HS2 project and to bid for the steel? That would mean having Chinese steel in one of our major infrastructure projects.

[Stephen Kinnock]

I was not surprised. Let me remind the House that 80% of the Chinese steel sector is state owned. On what planet can that be considered a market economy? I leave that to the House to decide.

The Secretary of State’s claims that he has been working on these things for months simply do not stack up. Yesterday, both in this House and at the APPG meeting, he claimed to have been aware of Tata’s decision to sell before it was publicly announced. If that was the case and if he really knew what was coming, why on earth was he on the other side of the world when the board meeting was taking place? Why was he caught so unaware? If he really was in the know as he claims to have been, why did he have to rush back to the UK in a mad panic?

The Secretary of State also boasted yesterday that it was his actions and his actions alone that prevented Tata from closing rather than selling Port Talbot and the rest of its strip products division. I must admit that my jaw hit the floor when I heard that claim. I was out in Mumbai. I was there for the board meeting with Roy Rickhuss and Community. The Secretary of State was not. Tata has expressed deep disappointment and frustration with the lack of support that it has received from this Government. We have seen delayed action on energy compensation, with many companies still waiting to receive their money, and weasel words on procurement from a Government who got the steel for the latest set of Ministry of Defence frigates from Sweden. Above all, Tata saw a Government who refused to support the steel sector in tackling Chinese dumping by opposing trade defence reforms, while championing market economy status for China. Therefore, this supposedly pro-business Government's influence on Tata is very limited. What really made the difference was Community’s high profile “Save our Steel” campaign, and the fact that Labour MPs have raised the issue of steel on more than 200 separate occasions since the general election.

The clock is ticking. Tata has said that it will give the sale “all due time”. Yesterday’s news about Scunthorpe took almost nine months, and it is still not fully complete. The deal on Port Talbot and the rest of Tata’s strip operations may also take time. Let us therefore hope that today’s debate marks a step change in attitude and action by the Government. Let us hope that they work proactively to protect the entirety of the order book and that they save the future of the heavy end in Port Talbot,

[Jonathan Edwards]

The hon. Gentleman will know that his colleagues in the Welsh Government have spent £80 million on a conference centre in Newport and £58 million on the airport in Cardiff. Does he think that the £60 million allocated to Tata in Port Talbot is sufficient?

--- Later in debate ---

[Stephen Kinnock]

There is a stark contrast between the actions of the Welsh Government and the actions of the UK Government. There is £60 million on the table, and the Welsh Assembly was recalled, and that should have happened in Westminster, so the contrast is clear.

Let us hope that the Government develop and execute a proper industrial strategy, so that the Opposition do not have to raise this matter a further 200 times in the weeks and months to come. Let us hope that they will stand up for steel.