The current crisis in United Kingdom steelmaking has exposed the ‘northern powerhouse’ for what it is truly is – a sham. Behind the government’s claims to be creating a ‘march of the makers’, rebalancing the economy away from financial services towards manufacturing and regional growth, stands a laissez-faire government with no interest in supporting strategic national industries. In the face of a challenging global steel market, they have stood by and let British industry bear the brunt of the economic headwinds from China without protection.
In my constituency of Redcar on Teesside the full consequences of government inaction have been felt. 175 years of steelmaking came to an end in just 10 days with the immediate loss of 2,200 jobs and thousands more in the supply chain now at risk. The second largest blast furnace in Europe is being left to go cold instead of being mothballed and the productive coke ovens have been allowed to collapse before interested parties could prepare a proper bid. It is industrial vandalism at the hands of a government who do not value our manufacturing base and the skilled jobs it provides. The crisis now threatens to embroil the whole of UK steel as other firms slash jobs.
It does not have to be this way. While it is true many of the global pressures on the industry are out of state control, there are steps the government could have, and still can, take to help the industry develop resilience in a turbulent market. They just need the political will to do it.
Action on business rates and energy compensation would level the playing field with our European competitors. Working with Europe to implement anti-dumping measures to protect our industry from cheap, subsidised Chinese imports as the United States has done to great effect. An active industrial policy that ensures British steel producers can benefit from procurement in national infrastructure projects. Not slavishly following European Union regulations to a degree not matched by other member states.
It is to mine and my colleagues’ frustration that they have sat on their hands and not acted sooner. UK Steel, Community Union and members of parliament have been calling for action for months. When the government eventually called a steel summit to address the crisis, on the back of demand from Labour MPs, it was held after the official receiver had announced the closure of Redcar steelworks. A minimal investment in the plant could have given the breathing space to address the crisis, find a buyer and secure its future.
Ministers are now going out of their way to court Chinese investment, offering up contracts on UK infrastructure projects like HS2 and nuclear power. Steel has a role to play in all of this. On Teesside it was also at the heart of plans for Europe’s first industrial carbon capture and storage network. Instead, the British steel industry is left fighting for its survival amid a flood of cheap steel from subsidised Chinese furnaces.
Throughout the crisis the minister responsible for the ‘northern powerhouse has been noticeable by his absence and a passing reference to the crisis as ‘a tragic distraction’. It appears the project is nothing more than a brand, upon which ministers can hang good news stories. Our steel industry needs more than just warm words and empty promises. It needs government to actively support British industry and manufacturing. If they can find the will, it is not too late.
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