THE EARL OF GOWRIEMy Lords, my right honourable friend the Secretary of State for Trade and Industry is making a Statement in another place to-day on the British Steel Corporation's development plan. Since your Lordships' House is about to rise, I will, with the leave of the House, arrange for this Statement to be circulated in the OFFICIAL REPORT. Perhaps I may at the same time take this opportunity to wish all your Lordships a very happy Christmas.
§ Following is the Statement referred to:
§ "With permission, Mr. Speaker, I wish to make a Statement on the modernisation programme of the 1262 British Steel Corporation. I have reached agreement with the Corporation on a strategy for the major modernisation of British steel production over the next ten years. It will require a programme of investment of £3,000 million to provide for modernisation and expansion—by far the biggest carried out in the history of the British steel industry. The object of the strategy is to create an efficient, profitable, modern industry able to compete with the rest of the world and able to assure future employment. It involves a major development of the five main heritage sites and of special steel plants in the Sheffield/Rotherham area and the development of a major new steel complex. The effects on the major steel-producing regions will be as follows:
§ "WALES: A major development to 6 million tonnes at Port Talbot in addition to the current expansion at Llanwern. This should assure the future of the Welsh tinplate industry. Steelmaking and hot-rolling at Shotton will continue until towards the end of the 1970s and finishing processes will continue thereafter. Wales will have nearly 30 per cent. of the total investment under the strategy—an investment approaching £900 million. Steel production in Wales will be increased to about 10 million tonnes. The future of East Moors (Cardiff) and Brymbo are the subject of continuing discussion between the BSC and GKN.
§ "SCOTLAND: The heritage site at Ravenscraig is already being expanded. It will be further expanded during the period to 3.2 million tonnes steelmaking capacity. The Corporation will also install new electric are steel making of up to 1 million tonnes. This is likely to be at Hallside and supported at some stage by a new direct reduced pellet plant, probably at Hunterston. Thus, by the end of the period covered by the strategy total steel production in Scotland will be increased to about 4½million tonnes. Finishing processes will continue at many of the present Scottish works, including Glengarnock, and will provide the wide range of products which are so important to the Scottish steel using industries.
1263§ "THE NORTH EAST: There will be a substantial increase in output from the heritage site at Lackenby and the development of a major new steel complex on the South Bank of the Tees. This complex will be developed in two phases each of about 3½ million tonnes capacity. The new works will be adjacent to the existing Lackenby works and their combined capacity would ultimately exceed 12 million tonnes.
§ "YORKSHIRE / HUMBERSIDE: There will be a substantial increase in output from the Anchor development on the heritage site at Scunthorpe. In the Sheffield/Rotherham area capacity for stainless and alloy steelmaking and rolling will be modernised and expanded.
§ "The five heritage plants and the new Teesside works are expected eventually to provide the whole of the Corporation's bulk steelmaking apart from certain electric are furnaces. For some years steelmaking will also continue at other centres. The existing finishing plants at a number of these centres will continue for the foreseeable future.
§ "It is vital that there should be flexibility to adjust plans to changing circumstances and we have agreed with the BSC guidelines under which we will be able to regulate the timing of the major projects. Decisions as to timing will of course depend on the pattern of competition, demand and prices and on the changing efficiencies of particular plants. This strategy should enable-employment in the industry to be maintained at a higher level and with far greater security than would otherwise have been possible. It will, however, in a number of areas mean a loss of jobs over the decade.
§ "Since the nationalisation of the steel industry, the BSC has cut its manpower by 27,000 and future measures resulting in a further reduction of 20,000 have already been announced. Under the proposed strategy of modernisation, manpower would fall by another 30,000 by the end of the decade. But it is only by modernisation that we can secure the 180,000 jobs then remaining in the BSC. Moreover, the investment required by the 1264 programme will sustain and create a large number of jobs—possibly as many as 75,000. These will be principally in the heavy electrical mechanical and civil engineering industries. It will also give British plant manufacturers a domestic market which will be a good base for export opportunities.
§ "The Government are particularly concerned about the impact on a number of communities where steel has been the dominant industry and intend to work closely together with the Corporation and the trade unions concerned so as to minimise the social consequences in these localities. The fullest use will be made of the Industry Act and the advance factory programme and there will be a concerted interdepartmental effort to assist in providing new job opportunities.
§ "British industry requires steel of high quality at competitive prices to ensure its own contribution to growth at home, to benefit from the Common Market opportunities and to participate in expanding world trade. A modernised British steel industry will make a vital contribution to this. This strategy will give management and men, with their great tradition and skills, the opportunity to win for the industry its share of the expanding steel market and to assure Britain's continuing place among' the' major steel producers of Europe and the world.
§ "A White Paper will be published as soon as possible setting out these proposals."