We need a strong steel industry to forge the future of our nation
As the fight to protect our steel industry continues, Aberavon MP Stephen Kinnock explains why it is critical for Port Talbot and the UK both in terms of jobs and contribution to the economy, and calls for the UK Government to provide the necessary financ
STEEL is synonymous with Port Talbot. The works have been the beating heart of our community for generations. The town grew around the steelworks, at its height nearly 20,000 people worked there, and the Sandfields estate was built to house the workforce.
It’s a massive part of our history, it’s shaped our town’s identity, but it is also an integral part of our future too.
Steel is in the buildings we work and live in, it’s in the cars we drive, the infrastructure we use, and it’s in the pots, pans and cutlery we use. The home of Welsh rugby, the Principality Stadium, is made from British steel, and the nightingale hospitals were also constructed with steel.
Steel is essential not only to our economy, but to our culture, our public services, our sense of community and to our whole way of life.
Steel is also crucial for the green agenda. Wind turbines are based on steel, as are many other green technologies, and steel will be vital in the manufacture of electric cars. It’s very much an industry for the future: SPECIFIC Innovation Centre is working on a project with Tata and Swansea University to create photovoltaic cells on the basis of a steel-based film, which could turn every home and office in our country into a power station.
Throughout the pandemic steelworkers were classified as key workers. They continued to make vital materials for our NHS like hospital beds and the packaging needed in our food industry. Now steelworkers are ready to play their part in rebuilding the country post-pandemic.
Steel is as important now as it ever has been,
because our national recovery will be underpinned by the steel industry. As we rebuild the economy and the country, the Government’s promise to “build, build, build” will require millions of tonnes of steel, and in Port Talbot we make the best steel that money can buy.
But let’s be clear – there can be no post-pandemic recovery without a strong and healthy steel industry.
The pandemic has shown us that we must reduce our reliance on fragile international supply chains, and so it is vital to our sovereign capability and our national security that we develop and strengthen our steel-making capabilities.
Steel is a strategic foundation industry that is the base of the supply chain for vital sectors of the economy like the automotive, aerospace, construction and defence sectors, so we must protect and invest in it if we want all the other industries that it supports to thrive. Other leading economies around the world like America, China, Japan, Germany and India have all recognised the importance of a strong steel industry for their economies. If Britain wants to compete on the world stage, then it needs to do the same.
For that to happen, the UK Government needs to stop seeing the industry as metal-bashing or as a problematic “sunset industry”, and see it for what it really is – a strategic, highly innovative and future-facing foundational industry that will underpin and drive our economy into the 21st century.
Steel unions – Community, GMB and Unite – have therefore joined with UK Steel in a campaign for the future of the UK steel industry, and to convince the UK Government to see the vital importance of steel. The Britain: We Need Our Steel campaign not only calls on the UK Government to support the steel industry, but also drives home the importance of why we need a healthy steel industry.
The campaign calls on the UK Government to do five things.
First, to ensure our infrastructure is built with UK steel. The UK Government’s record on this is poor, with less than half of the steel they procure having been made in British plants. The UK Government’s failure to buy British is a kick in the teeth for our steelworkers, their families and for communities like Aberavon.
HS2 will use an estimated two million tonnes of steel, and the use of UK steel in the project would support over 2,000 steel jobs and deliver £1.5bn into the UK economy. Yet key UK Government departments like the Department for Transport are still avoiding signing up to the UK Steel Procurement Charter, a commitment to promote and facilitate the use of UKproduced steel in construction and infrastructure projects.
The UK Government needs to commit to a patriotic procurement policy and use British steel for infrastructure projects.
Second, the UK Government needs to intervene to support the industry and stimulate steel demand. It took French and German governments just a few weeks to loan their steelmakers the cash-flow support funds they needed to help them through this coronavirus crisis, while the UK Government sat on its hands. Covid emergency support to the steel industry has been far too slow, and the UK Government needs to be more proactive in supporting the industry’s major companies.
Third, it needs to implement trade arrangements that are fair and frictionfree. Some 70% of UK steel exports go to the EU, and even just a basic trade agreement with the EU could cost the industry £70m a year through additional border checks.
The industry has also suffered from the dumping of cheap Chinese steel, and Trump’s tariffs have ended up severely damaging the UK’S US exports. The UK Government should be standing up and fighting for our steel industry on the global stage, and should make the dropping of the steel tariffs a condition for the continuation of US-UK trade talks.
Fourth, they need to create a level playing field so that the UK steel industry can compete. We need fairer industrial energy prices. Why is it that our energy prices are 80% higher than those of our competitors in France and 60% higher than in Germany? And our business rates are five to 10 times higher than in France, Germany and the Netherlands.
High energy costs and crippling business rates are leaving UK steel-makers competing with one hand tied behind their backs.
F i n a l l y , the UK Government needs to develop an industrial strategy, with steel at its core. The aerospace, automotive and construction industries all have sector deals, yet the industry that underpins our entire manufacturing base – the steel industry – does not. That really is a travesty. For the past five years I’ve been calling on the UK Government to give steel a sector deal, and I’ll keep holding its feet to the fire over this.
It is not just steelworkers and the steel industry that will reap the rewards of this – the entire country will benefit.
The economic contribution of our steel industry is enormous. Nationwide, the UK steel industry employs 32,000 people and it contributes £5.5bn to the economy directly and through the supply chains. There are 4,000 highly skilled and relatively well-paid jobs at the Port Talbot works. Its output is of critical importance to the local, Welsh and British economies. Indeed, Professor Calvin Jones, who has studied the economic impact of Tata Steel, has called it “the most economically important private sector company in Wales”.
The Port Talbot works, along with steelworks across the UK, are uniquely placed to drive the country’s recovery from the pandemic.
Now more than ever, it’s important that the UK Government gets that message and understands what steel can do for our country.
You can play your part in hammering that message home by joining the Britain: We Need Our Steel campaign. Sign the petition and get behind steelworkers and the industry at www. megaphone.org.uk/ petitions/britainwe-need-our-steel
Steel is essential not only to our economy, but to our culture, our public services, our sense of community and to our whole way of life
- Aberavon MP Stephen Kinnock