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Steelworkers march on parliament as Sajid Javid pledges talks with EU Steelworkers march on parliament as prime minister promises compensation
(about 7 hours later)
The business secretary is holding talks with European Union officials about the steel crisis, as workers protest in Westminster on the same day as a parliamentary debate on the industry’s plight. David Cameron has pledged to award backdated compensation for high energy costs to struggling British steel producers as soon as the government gets clearance from Brussels.
Sajid Javid has called for an emergency EU meeting on the steel industry amid increasing cdemands for the government to intervene to prevent plant closures. He will discuss international trading of steel with the EU’s trade commissioner, Cecilia Malmström, and meet other officials. The prime minister’s promise was delivered as steelworkers travelled to Westminster to make the case for political intervention in the industry.
Javid’s trip coincides with an opposition day debate about the UK’s steel sector – which has been rocked by plant shutdowns and thousands of job losses. Steelworkers from northern England, the Midlands and Wales gathered outside parliament before meeting MPs ahead of the debate. The compensation move was announced during prime minister’s questions but was immediately denounced by opposition MPs as being too little too late during an emergency debate on the future of the industry. “We have been talking about the need for this compensation package for months,” said the Labour MP for Middlesbrough, Andy McDonald. “It’s as if the scales have just been removed from his eyes.”
The steel industry, unions and Labour MPs have accused Javid of inaction following the indefinite closure of the Redcar steel mill on Teesside, the administration of Caparo industries and the mothballing of Tata Steel mills in Scunthorpe and Scotland. Related: Life after steel: can Redcar rise from the ashes?
John McDonnell, the shadow chancellor, told the steelworkers outside parliament that Javid was a “waste of space” who was “passing through” in the hope of higher office. Cameron’s announcement referred to the energy-intensive industries’ compensation package, which is part of a bundle of measures first announced two years ago and is designed to compensate steel producers for green levies. According to industry trade body UK Steel, the sector is paying £4m a month in green levies, which is making it uncompetitive against its European rivals.
“He’s told what’s needed and then completely ignores it, but there hasn’t been a single day when steel hasn’t been raised by us,” McDonnell said. “We’re up against it. They hold all the cards in their hands but we have got them to do a U-turn – and I’m an expert in U-turns.” Gareth Stace, director of UK Steel, described the prime minister’s commitment as “significant”. But he added: “Clearly there is a need to deliver this as a matter of urgency.”
The industry has been battered by falling steel prices, made worse by alleged dumping of cheap steel in Europe by China, high energy costs and the strength of the pound making exports expensive. Stace also urged the government to support using local steel in domestic contracts after reports that a multi-billion pound contract for armoured cars and ships would use Swedish steel. “Insisting on a significant level of local content is one of the key ways in which government can support the steel sector, with defence being a key example,” he said.
The deputy head of China’s iron and steel association warned that demand was collapsing and losses were mounting for the world’s biggest steel industry, suggesting no let-up in efforts to offload Chinese steel overseas. Nearly 100 workers from south Wales and Rotherham watched the debate in the chamber while the business secretary, Sajid Javid, held crisis talks with EU officials in Brussels about the state of the industry.
“Production cuts are slower than the contraction in demand, therefore oversupply is worsening,” Zhu Jimin said, according to Bloomberg. “Steel mills are lowering prices in competition to get contracts.” The steel industry, unions and Labour MPs have accused Javid of inaction following the closure of the Redcar steel plant on Teesside with the loss of 2,200 jobs, the administration of Caparo industries and the mothballing of Tata Steel mills in Scunthorpe and Scotland with 1,200 redundancies.
More than 5,000 British steelworkers, or one in six in the industry, face losing their job and more closures will follow without urgent action, Javid’s critics say. Related: Government promises support for British steel industry
Javid told MPs last week that the government was unable to dictate the price of steel or to get round EU restrictions on national governments supporting industries. But pressure has been building on the government to do something. John McDonnell, the shadow chancellor, told the steelworkers that Javid was a “waste of space” who was “passing through” in the hope of higher office.
He said: “I want to see steel top of the EU agenda. 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.” “He’s told what’s needed and then completely ignores it, but there hasn’t been a single day when steel hasn’t been raised by us,” McDonnell said. “We’re up against it. They hold all the cards in their hands but we have to get them to do a U-turn – and I’m an expert in U-turns.”
The Unite trade union called on the government to stop Chinese steel dumping, help with high energy costs and business rates and make sure UK steel was used in infrastructure projects. Unions last week attacked government pledges to help steelworkers find new jobs and support new businesses as woefully inadequate. Andy Thompson, 29, one of the steelworkers who travelled to Westminster, said: “If this government lets the steel industry go, then industry as a whole doesn’t have a future.”
Unite’s assistant general secretary, Tony Burke, said: “The approach by ministers so far has been to deal with the symptoms of the steel crisis, when what steel and manufacturing communities want is action that secures UK steelmaking and secures their futures. Thompson, a section engineer for Tata Steel in Rotherham, said he would seek a new career in the NHS or at a university. But he praised his colleagues, who are working under uncertain conditions. “Steelworkers are a breed apart,” he said. “They stick together and there’s a community spirit.”
“Instead of intervening to keep the coke ovens burning at Redcar, ministers sat on their hands and allowed a key industrial asset to close for ever, taking with it the livelihoods of thousands of people.” Another steelworker at Westminster, who works at a four-fifths mothballed plant in Llanwern, south Wales, said that key skills were bound to drift away if the industry continued to struggle. “Engineers are eminently employable and they will drift away,” said Barry Hayman, a shift engineer for Tata Steel.
Javid said he would discuss the steel sector and industrial strategy with the internal market commissioner, Elżbieta Bieńkowska, and the EU vice-president, Jyrki Katainen. He has also spoken to the competition commissioner, Margrethe Vestager, about speeding up approval of the government’s scheme to compensate energy intensive industries. The industry has been battered by falling steel prices, made worse by the dumping of cheap steel in Europe by China, high energy costs and the strength of the pound making exports expensive.
Thecrisis escalated last week when China’s President Xi Jinping visited the UK. Industry figures accused the government of failing to raise Chinese dumping forcefully with Xi. Javid told MPs last week that the government was unable to dictate the price of steel or to get round EU restrictions on national governments supporting industries. But pressure has been building on the government to act.
Anna Soubry, the small business, industry and enterprise minister, told a committee of MPs on Tuesday the government would respond to industry demands for more support. Unions last week attacked government pledges to help steelworkers find new jobs and support new businesses as woefully inadequate.
Anna Soubry, the small business, industry and enterprise minister, told a committee of MPs on Tuesday that the government would respond to industry demands for more support.