£3.8billion defence deal to use steel from Sweden
As troubled industry sheds more than 3,000 jobs across Britain...
MINISTERS have been accused of turning their backs on British steelworkers after it emerged the Ministry of Defence will use Swedish steel in a multi-billion pound contract for armoured cars and ships.
The revelation came on the day Business Minister Anna Soubry told MPs that the Gov- ernment should ignore prices when procuring for public projects involving steel. She said: ‘Frankly, buy British. You get what you pay for.’
Miss Soubry suggested to the Commons business and industry committee that British steel was of superior quality and that the nation’s steel industry was too strategically important to be allowed to go bust.
Earlier Chief Secretary to the Treasury Greg Hands told the Commons that ‘we are making sure more public contracts are going to UK steel producers’.
David Cameron also vowed to change public procurement rules when he was questioned by Labour leader Jeremy Corbyn over the battered industry’s fate. But Defence Minister Philip Dunne revealed in a written Commons answer that hundreds of military vehicles will be made using Swedish steel. The MoD has placed a £3.5billion order for 589 Ajax armoured vehicles, and will spend a further £348million on three new Royal Navy offshore patrol ships, to be built with steel imported from Sweden.
Mr Dunne said: ‘The steel for HMS Forth (as well as HMS Medway and HMS Trent) is sourced via Dent Steel Services (Yorkshire), who conduct shot blasting and priming, from SSAB of Stockholm (previously ‘Swedish Steel’) who are able to supply the grade of steel necessary for this application.’
He also revealed that the Ministry of Defence was turning to Sweden for armoured vehicles tanks because the steel needed to be of ‘ the required quality’.
‘The quantities of steel required for the Ajax programme ... are rela- tively small and spread over eight years of manufacture. The steel is specialist in nature with the majority coming from Sweden,’ Mr Dunne said. Shadow Defence Minister Kevan Jones accused ministers of ‘turning their backs on British jobs and industry’.
He said: ‘By buying Swedish steel for Royal Navy ships and Army land vehicles, they are turning their back on British jobs and industry. MoD ministers need to pull their finger out and support British steelworkers.’
Steel bosses told MPs on the committee that the industry was ‘likely to die’. Gareth Stace, director of trade body UK Steel, said a fifth of the sector’s UK workforce had lost their jobs or were facing redundancy.
He added: ‘If we were a patient on an operating table, we are bleeding very quickly. And we are likely to die on that table.’ Mr Stace blamed the emissions directive, business rates, the carbon floor price and China’s steel dumping for the battering of the UK industry. Roy Rickhuss, general secretary of the Community trade union, said the current crisis was ‘ out of control’. Around 3,300 jobs have been axed in recent weeks by Tata Steel and SSI in Redcar, Scunthorpe and Scotland. A further 1,800 jobs are threatened at Steel processing giant Caparo Industries, which has gone into administration.
Business Secretary Sajid Javid will hold talks in Brussels today to urge the EU to speed up rules to allow governments to back national industries. He will call for steel to be ‘top of the EU agenda’.
Ahead of his visit, he said: ‘ We cannot stand by while the steel industry across Europe, not just in the UK, faces such unprecedented challenges.
‘There are no straightforward solutions to the complex global challenges but the UK government wants to work with the EU and our European partners to do all we can to support our steel industry.’
‘Our industry is
likely to die’
Frankly, buy British ... you get what you pay for Business Minister Anna
Soubry yesterday