UK Steel: Government Infrastructure Projects

Treasury – in the House of Commons on 27th April 2021.

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Photo of Stephen Kinnock Stephen Kinnock Shadow Minister (Foreign and Commonwealth Affairs)

What steps his Department is taking to increase the amount of UK steel used in Government infrastructure projects.

Photo of Kemi Badenoch Kemi Badenoch The Exchequer Secretary, Minister for Equalities

There are global challenges in the steel industry, with vast overcapacity and supply outstripping demand. However, the Government have supported the steel sector extensively, including providing more than £500 million in recent years to help with the cost of energy. Our unprecedented package of covid support is still available to the sector to protect jobs and ensure that producers have the right support during this challenging time.

Photo of Stephen Kinnock Stephen Kinnock Shadow Minister (Foreign and Commonwealth Affairs)

Steel is central in terms of good jobs, national security and combating climate change. There can be no post-pandemic economic recovery without a strong and healthy steel industry. Will the Chancellor therefore commit today to recognising the pivotal strategic importance of the steel industry by using the power of the Treasury to reduce the exorbitant electricity prices faced by our steelmakers—currently 82% higher than in Germany—so that our steel industry can compete on a level playing field?

Photo of Kemi Badenoch Kemi Badenoch The Exchequer Secretary, Minister for Equalities

I reassure the hon. Gentleman that that is something that we are doing. As I mentioned in my earlier answer, we have already spent £500 million across the sector specifically to deal with that point. Further, we are taking a number of steps to support the decarbonisation of the UK steel industry. For example, we announced the £250 million clean steel fund to support the decarbonisation of the steel sector, including its transition to new low-carbon technologies and processes.

Photo of Abena Oppong-Asare Abena Oppong-Asare Shadow Exchequer Secretary (Treasury)

Jobs in the steel industry are crucial to the people of Hartlepool. In June, the first instalment of the EU research fund for coal and steel will be returned to the UK. Are the Government planning to ring fence that money to support the decarbonising and modernising of the industry, given the vital importance of protecting steel jobs for the future?

Photo of Kemi Badenoch Kemi Badenoch The Exchequer Secretary, Minister for Equalities

I thank the hon. Lady for her question. I mentioned in my answer to Stephen Kinnock the steps that we are taking to decarbonise the UK steel industry. As I said, there are global challenges in the industry and we have been supporting various companies. For example, last year, we provided a £30 million loan to Celsa, safeguarding a key supplier to the UK construction industry and securing more than 1,000 jobs, including more than 800 positions at the company’s main sites in south Wales. The Government will continue working with businesses to understand the issues that they are facing, including continuing to engage business sectors that are affected by covid and our changing relationship with the EU.