Steel Industry (Hansard, 31 October 1990)

§ 2. Mr. Tom Clarke
To ask the Secretary of State for Trade and Industry if he will make a statement on the future of the steel industry in the United Kingdom.

§ The Secretary of State for Trade and Industry and President of the Board of Trade (Mr. Peter Lilley)
I am confident that the United Kingdom steel industry will continue to perform well now that all of it is in the private sector.

§ Mr. Clarke
Will the Secretary of State use his influence firmly to ensure that there is no dismantling of the strip mill at Ravenscraig until the Scottish Development Agency's report has been received and properly assessed, given the devastating impact of such a decision on the people of west central Scotland?

§ Mr. Lilley
I entirely endorse what my right hon. and learned Friend the Secretary of State for Scotland has said and done about this. I believe that British Steel has said that it is awaiting the results of the SDA report on the steel industry in Scotland.

§ Mr. Devlin
Will my right hon. Friend ensure, however, that any decisions about the future plate mill are made for proper commercial reasons? If those reasons show that such a mill should go to Teesside instead of propping up the Scottish steel industry, will not that be the correct decision?

§ Mr. Lilley
Of course, the location of plant is a matter for British Steel now that it is in the private sector, and it will take such decisions on a commercial basis. I am sure that no hon. Member would wish firms to be forced to locate according to political rather than commercial decisions.

§ Dr. Reid
How can the Minister stand there and say that he expects the steel industry to improve and prosper when there is an imminent threat to the Clydesdale tube works in Bellshill in my constituency? Is he aware that any such closure at Clydesdale would mean huge job losses and, as it is the only plant in the United Kingdom that produces seamless tubes, a further deterioration of the balance of trade? Would not it be a tragedy if an expanding North sea oil sector were to fuel the steel industries of our competitors at a time when our steel plants are closing? Will not the. Minister step in now before the threat becomes a reality and ensure that the Clydesdale tube works is saved?

§ Mr. Lilley
My right hon. and learned Friend the Secretary of State for Scotland has made it clear that we shall do all that we can to help this industry, like other industries in Scotland and the rest of the United Kingdom, to prosper. The Opposition seem to want to fossilise the economy and prevent all change. That is a recipe for turning Scotland and the entire United Kingdom into an industrial museum.

§ Mr. Bill Walker
Does my right hon. Friend agree that British Steel's record since privatisation—it has broken all production records—should give the House confidence in the way in which its management goes about its business? Although Governments can advise, they should never deem to instruct managers on how to run their businesses.

§ Mr. Lilley
My hon. Friend is absolutely right. British Steel and the British steel industry are very successful compared with almost every other steel industry in the world. In the first nine months of this year, our steel exports were up 7 per cent. and imports were down 8 per cent. Productivity has increased threefold over the past decade. That is good news, and it is sad that it is not welcomed by the Opposition.

§ Mr. Kirkwood
How can the Minister satisfy the House that the Government can plan a sensible industrial and economic strategy when they have been denied essential business and financial details by companies as important as British Steel?

§ Mr. Lilley
I did not realise that the hon. Gentleman was in favour of state planning.

§ Mr. Holt
Does my right hon. Friend recall the time when the subsidy to British Steel was about £14 billion or £15 billion—a great deal of money which could have been spent on hospitals, nurses, doctors, old-age pensions, children and the other welfare measures which we are now able to afford because such money is not being poured down the drain by a nationalised British Steel?

§ Mr. Lilley
My hon. Friend is absolutely right. In the decade up to 1985, the total subsidy to British Steel, in present-day money, was £14 billion. It is hard to know where the Opposition expect to get such money, as they have already mortgaged the future with promises to spend on almost everything else. If they return to a state-controlled, state-regulated or nationally owned steel industry, we shall again be back in that loss-making era.

§ Mr. Gordon Brown
Will the Secretary of State remember that it is not the Secretary of State for Scotland but he, the Secretary of State for Trade and Industry, who is responsible for industry and for steel? Will he therefore meet the chairman of British Steel to discuss the Clydesdale rescue plan so that we can gain a higher share of North sea work? Will he tell him of his view, and that of the Secretary of State for Scotland, that there must be no demolition or asset-stripping at Ravenscraig before there is a discussion on and examination of the Scottish Development Agency's proposals? Will he set up an action team within the Department to consider the prospects for the steel industry, and will he explain to the high-productivity work force at Ravenscraig why, five months after Ministers promised that they would press British Steel to reconsider and review the decision on the strip mill, the Department has done absolutely nothing?

§ Mr. Lilley
From time to time, I meet the chairman of British Steel, but it is sensible that the Secretary of State for Scotland takes the lead on this issue. I have read the so-called five-point plan for the future of the steel industry which the hon. Gentleman just summarised. Four of its points are contrary to the treaty of Rome, and one is simply the establishment of a committee.