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Steel Industry — [Mrs Madeleine Moon in the Chair]

Part of the debate – in Westminster Hall at 2:30 pm on 11th May 2016.

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Photo of Tom Blenkinsop Tom Blenkinsop Labour, Middlesbrough South and East Cleveland 2:30 pm, 11th May 2016

I thank the hon. Gentleman for his contribution. I have been chair of the all-party group on steel and metal related industries for five years and we have tried to reiterate the arguments for the steel industry. In 2012, when I first mentioned a debate about Thames Steel Services in Kent in the south-east of England, which is obviously not in my constituency but is part of the steel family, we did not get much of a hearing from the Government. Following that, we had further debates on the impending crisis, which we could see coming because of dumping from Chinese markets and other repercussions of Government policy. Ministers from the Department for Culture, Media and Sport responded. They were not even Ministers from the Department for Business, Innovation and Skills. I kindly suggest that the hon. Gentleman looks at the record of the last few years. Colleagues in this Chamber who are members of the all-party group from other parties are well aware of that history.

The Government must stop dodging the issue and start to work on a strategy to protect and boost the industry across the UK. A real concern is the amount of time that Tata Steel is allowing for the sales process and that an arbitrary deadline will be imposed that is too soon for credible investors to develop a viable bid. Tata allowed time for the sale of its long products business to a credible investor. It should provide the same opportunity to bidders for the rest of its UK business as it allowed in every contemporary example, including SSI back in 2010 and Greybull Capital now—and, indeed, as was allowed in Tata’s own acquisition of Corus back in 2006.

The story is lost to some extent, but Tata achieved its purchase of Corus in competition mainly with a Brazilian company and it achieved it only because in 2002 Tony Pedder, who headed up Corus at the time, was in competition with the same Brazilian company to create a merger, which then failed. Four years elapsed to allow Tata to purchase it. Some would argue that it paid an expensive share price, but that time elapsed and both competitors ratcheted up the share price because they thought the British assets were so key and vital, as they still are.

Public sector steel contracts must specifically consider UK steel, but I and my colleagues are concerned about recent reports that British steel is not being used in vital upcoming manufacturing projects—for example, Ajax vehicles. The Defence Minister, the right hon. Earl Howe, revealed in answer to a parliamentary question that 40% of the work building those vehicles will be carried out in Spain and a majority of the supplied steel will come from Sweden. This came after the Prime Minister hailed the deal as a boost for British manufacturing. Another example is the Aberdeen city bypass. Negotiations on a £12 million contract for 10,000 tonnes of rebar for the bypass have been reported as being at an advanced stage with Turkey.

Legislation and warm words are not enough to guarantee the viability and sustainability of a UK steel industry. The Government must act now to ensure that British steel is used in every public sector manufacturing contract and that British jobs are protected.