Steel Industry (Hansard, 14 February 2002)

§ 6. Helen Jackson (Sheffield, Hillsborough)
What recent discussions she has had regarding the UK steel industry. [33796]

§ The Parliamentary Under-Secretary of State for Trade and Industry (Miss Melanie Johnson)
My right hon. Friend the Secretary of State for Trade and Industry, Ministers and officials have had discussions with key organisations representing the steel industry about a variety of issues in recent months. The latest focused on the proposed US action to impose additional import duties and quotas on a wide range of steel products.

§ Helen Jackson
Does my hon. Friend agree that the steel industry is no longer an old, dirty smokestack industry, but one for this century that is at the cutting edge of technology and at the core of this country's manufacturing sector? For those reasons, we welcome the Government's support for the industry and, in particular, the national metals centre in South Yorkshire and the work on America. Does my hon. Friend recognise that the industry's strength lies in the people whom it employs? Will she give continuing support for their training, their skills base and, indeed, their pay in the current circumstances?

§ Miss Johnson
I very much agree with my hon. Friend on the importance of new technological developments and the way in which the national metals technology centre will bring together industry, science and academia to create a unique network and facility for UK metal producers, fabricators and users. That shows how we are moving forward. As my right hon. Friend the Secretary 301 of State said when she announced the funding for the centre, we shall ensure that the metals industry is equipped to be a world-class competitor for years to come.

§ Mr. Simon Thomas (Ceredigion)
Has the Minister read the story in this morning's Western Mail revealing that the company controlled by Lakshmi Mittal, the Labour party donor, has already cost Allied Steel and Wire £5 million of business? Allied Steel and Wire employs 1,300 people in this country—1,000 of them in Cardiff—while Ispat employs fewer than 100. What advice would the Minister give to Allied Steel and Wire workers? Would it be to write to the Prime Minister to intervene on their behalf with Mr. Mittal? Or would it be to have a quick whip-round for Labour party coffers?

§ Miss Johnson
The advice that I would give the hon. Gentleman is to read Monday's press release from the Iron and Steel Trades Confederation general secretary, who said that the allegation made by the Tories and Plaid Cymru that the Prime Minister had put the interests of Romanian steel workers before those of UK steel workers was "ludicrous and cheap". He went on to say that he had explained the situation to the hon. Member for East Carmarthen and Dinefwr (Adam Price), who neglected to check the comments that had been made before going public with the allegations. The general secretary said—

§ Mr. Simon Thomas
Answer.

§ Mr. Speaker
Order. The hon. Gentleman should let the Minister reply. He asked the question: he should give her courtesy.

§ Miss Johnson
The general secretary of the ISTC went on to conclude in the press notice that matters had not been checked before the allegations were made public. The hon. Member for East Carmarthen and Dinefwr is reported to have apologised, but the general secretary went on to say that he was "dumbfounded" that the allegations continued to be made.
It is clear that Corm has cited general trading conditions as the reason for the pay freeze, rather than competition from firms in eastern Europe. The UK has an excellent productivity record.

§ Paul Flynn (Newport, West)
Is it not true that steelworkers rightly reject Plaid Cymru's malign fantasies? No one from that party took part in the negotiations last year, when Corus told my right hon. Friend the Prime Minister, the trade unions and MPs representing steelworks areas that nothing that anyone could do or say would alter the company's decision to mutilate and butcher the Welsh steel industry. Instead of turning this tragedy into a political football, should not Plaid Cymru Members join the Welsh Assembly and the Government in trying to heal the wounds, especially at a time when Corns is dripping a bit of extra acid into them?

§ Miss Johnson
As I said, the UK steel industry has an excellent productivity record. It has experienced difficult trading conditions in recent years, but the problems are not confined to the UK. We are part of a global economy, and no country can insulate itself from world economic events. The Government and Ministers are making every effort to work with Corns to ensure that the major problem 302 facing the industry—the threatened events in the US—is dealt with and tackled in an effective manner. We believe that the issue that needs to be addressed is that, unlike the industry in the UK and the EU, the US industry is trying to export problems to the rest of the world. The US needs to grasp that nettle. Imports are not the cause of the problem.

§ Mr. John Whittingdale (Maldon and East Chelmsford)
I am genuinely sorry that the Minister has been the one to draw the short straw in having to answer this question. However, the UK steel industry is suffering from overcapacity, and there have been 6,000 job losses. Will she say what possible benefit the industry will receive as a result of the support given by the Prime Minister and the Secretary of State for the purchase of a Romanian steel company by a company that is not based in Britain and which employs fewer than 100 people in this country?

§ Miss Johnson
The Prime Minister made it clear—as did his letter—that it is a market opening in Romania for British industry. I am sure that the hon. Gentleman recognises that both that and the restructuring that is under way in the Romanian economy are important for British industry. In trying to trivialise those matters, is he not losing the thread of the argument that what we are about in the UK is promoting British business and British jobs, whether at home or abroad?

§ Mr. Whittingdale
The hon. Lady describes it as "British industry", but on what definition can a company with less than 0.1 per cent. of its work force in Britain possibly be described as British? Is she aware that British steel manufacturers have already said that a revitalised Romanian industry is bound to make it harder for British steel companies to compete? Is not that why the last Conservative Government lobbied against LNM being allowed to take over Irish Steel? Is it not the case that there will be no benefit to Britain from this takeover—other than a return for favours given to the Labour party?

§ Miss Johnson
The Prime Minister dealt with a number of those issues yesterday, when I am sure that the hon. Gentleman was in this place. The LNM group gives London as its headquarters address, and a number of UK-registered companies are part of the group.
Turning to the real issue for the UK steel industry at present—Opposition Members seem to have a problem focusing on that real issue, unlike Labour Members—the industry faces concerted unilateral US action on steel imports that would create fresh barriers to transatlantic trade and fresh distortions in the global steel industry. That is the real issue facing the UK steel industry.