HC Deb 22 January 1973 vol 849 cc13-6
7. Mr. Hardy

asked the Secretary of State for Trade and Industry what is now his estimate of the productive capacity of the British Steel Corporation in 1975 and in 1980.

Mr. Peter Walker

The British Steel Corporation modernisation programme which I announced on 21st December is a flexible programme which could take the corporation's capacity to about 29 million tonnes of liquid steel by 1975, to 33 million to 35 million tonnes by the late 1970s and 36 million to 38 million tonnes in the first half of the 1980s. Together with the private sector this would mean a national capacity of some 39 million to 42 million tonnes in the first half of the 1980s.—[Vol. 848, c. 1576–8.]

Mr. Hardy

Is the Secretary of State aware that his recent statement appeared to be excessively vague about the future of the profitable Sheffield and Rotherham areas? Is he aware that in those areas there is considerable suspicion that although capacity may increase, the number of jobs which will disappear will be somewhat more than he appeared to suggest in his recent statement? We need to know a great deal more about the future of those areas. Will the right hon. Gentleman come to the House as soon as possible to give detailed information and allay the suspicion he has created?

Mr. Walker

I hope that during the first week of February a White Paper will be published giving more information.

Mr. John Morris

Has there not been yet another massive U-turn in the Government's thinking on steel, as they referred in their announcement early last year to the bottom end of the scale as 28 million to 36 million tonnes? Had there not been a change of thinking, would the Minister seriously dispute that we would be faced with massive imports before the end of the present decade?

Mr. Walker

No. I believe that any imports we are faced with are due to a complete lack of investment in the period 1964–70. I hope that the new investment programme will ensure that there is no need for massive imports.

15. Mr. Ashley

asked the Secretary of State for Trade and Industry if he will now make a statement about the employment prospects in the steel industry for the next two years.

Mr. Tom Boardman

There will be no change in the employment prospects for the steel industry in the next two years as a result of the strategy announced on 21st December. There have, prior to the strategy, been a number of closures announced which fall into this period, and on the basis of present plans by March 1975 the number of people employed in the steel industry is expected to be about 221,000 as compared with 230,000 now.

Mr. Ashley

Is the hon. Gentleman aware that the whole of North Staffordshire is waiting anxiously to see whether the steel workers at Shelton will be allowed to exercise their great skills or whether they will be conscripted into the bloated army of the unemployed? Will the hon. Gentleman do all he can to ensure that those skills are not wasted and that the region does not become a depressed area?

Mr. Boardman

The figures I have quoted for the next two years do not include Shelton since it is not expected that it will close during those two years.

Sir R. Cary

When is my hon. Friend likely to be in a position to name the sites of the proposed two mini-mills which are to be established in the immediate future?

Mr. Boardman

This will take some time. My right hon. Friend has said that one will be in Scotland. The site of the other will be a matter for the decision of the British Steel Corporation after further evaluation. It will be some time before that can be decided.

19. Mr. Bruce-Gardyne

asked the Secretary of State for Trade and Industry what estimate he has made of the percentage adjustment in the British Steel Corporation's list prices for billets, medium plates, boiler plates, beams, steel for reinforcement, hot rolled strip and hot rolled coil, respectively, which will be required to conform to the rules and practice of the European Coal and Steel Community as soon as the Counter-Inflation (Temporary Provisions) Act lapses.

Mr. Peter Walker

The Treaty of Paris does not require producers to price their products at any particular level. My hon. Friend will see from the table I gave him in my reply of 4th December both that list prices for the same products vary from country to country and that the prices actually charged in Europe are often well below the list prices.

Mr. Bruce-Gardyne

I am grateful to my right hon. Friend for that reply so far as it goes. Will he now tell us whether, as soon as the freeze ends, the British Steel Corporation will be allowed to increase its prices to the point at which it can earn its target 8 per cent. on capital employed or there will be a further extension of taxpayer subsidisation of prices? If so, how long will it be before we observe the rules of the European Coal and Steel Community?

Mr. Walker

We have made clear in our White Paper on stage 2 that steel prices are subject to our obligations as members of the ECSC, and Treaty of Paris products are exempt from control under stage 2. The British Steel Corporation is conscious of the need to act responsibly in the fight against inflation.

Mr. Varley

With reference to the Counter-Inflation (Temporary Provisions) Act, what progress is being made in the discussions which the Secretary of State's Department is having with the British Steel Corporation about compensating the corporation for loss of revenue during the freeze and the period of the CBI restraint?

Mr. Walker

I cannot say at this stage, but I will keep the House informed as developments take place.

Mr. Edward Taylor

During stage 2 will any increase in steel prices preserve the principle of a common uniform de- livered price for steel throughout the country, or will there be varying increases in different parts of the country as under the Common Market rules?

Mr. Walker

We have stated that we shall go over to the basis of basing points as under the Common Market rules.