British Steel

Part of the debate – in the House of Commons at 12:40 pm on 21st May 2019.

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Photo of Andrew Stephenson Andrew Stephenson Assistant Whip, Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy) 12:40 pm, 21st May 2019

My Department is in regular conversation with a wide range of companies, including those in the steel industry. As the House will be aware, the Government entered into a commercial agreement with British Steel on 24 April, valued at £120 million, relating to the company’s obligations under the EU emissions trading system. The Secretary of State updated the House on that agreement in an oral statement on 1 May—the first available opportunity after market-sensitive elements of the resulting transaction were concluded. The commercial agreement reached with British Steel ensured that the company was able to meet its 2018 EU ETS obligations under a deed of forfeiture. It also ensured that the company did not incur an EU ETS non-compliance fine which, coupled with 2018 ETS liabilities, would have equated to a financial pressure of over £600 million—a sum that would have put the company under significant financial strain.

The speculation regarding the future of British Steel will no doubt be creating uncertainty for those employed by the company. As shown through the ETS agreement, the Government have been willing to act. We have been in ongoing discussions with the company, and I am sure the House will understand that we cannot comment in detail at this stage. We will update the House when more information is available. I can, however, reassure the House that, subject to strict legal bounds, the Government will leave no stone unturned in their support of the steel industry.

Yesterday I signed up to the UK steel charter. We want to acknowledge and support the initiative from the industry, and the charter is one element of that. We have been also been encouraging the UK steel sector to strengthen its engagement with all existing and potential domestic steel consumers, maximising opportunities to benefit from the £3.8 billion a year of high market value opportunities that we have identified by 2030. We recognise that global economic conditions continue to be challenging for the industry, which is why the Government are working with the sector, unions and the devolved Administrations to support a sustainable, productive and modern UK steel sector.