Blueprint to save UK steel industry – Ministers urged to adopt key recommendations

A blueprint for the future of the UK’s steel industry is set out in a new report by a cross-party group of MPs and Leeds University Business School.

The report, ‘Steel 2020’, has been published by the All Party Parliamentary Group on Steel and Metal Related industries and is based on testimony collected from industry experts ranging from business leaders, R&D specialists and the workforce, through to the European Commission, international trade body representatives, politicians, and local authorities.

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Seven key areas of policy and regulatory reform have been identified in the report, which includes recommendations for the Government to incorporate into its industrial strategy.

Commenting Unite general secretary Len McCluskey said:

The cross-party group of MPs has taken on board the key points Unite and the steel unions have been arguing for and laid down the gauntlet for government ministers.

Steel is a key foundation industry sustaining tens of thousands of jobs and manufacturing communities across the UK. It should be the beating heart of any manufacturing industrial strategy and a source for decent jobs for generations to come.

It was with bitter disappointment and a sense of betrayal that steelworkers learned of the decision to import steel for HS2.

We cannot have a repeat of British steel being overlooked for major defence and infrastructure projects, or the dumping of cheap Chinese steel which left the industry teetering over a precipice. Not only is it a real blow to workers fighting for their jobs, but it’s not very strategic industrially.

With the uncertainty of Brexit compounding months of turmoil for steel workers and their families, ministers need to adopt the key recommendations of this report to ensure the steel industry has a strong sustainable future and goes from strength to strength.”

Seven areas of policy and regulatory reform

1. A radical reshaping of the energy market to reduce uncompetitive energy costs faced by the steel industry, improving energy efficiency and spreading out the burden of decarbonisation policies.

2. Ensuring free and fair international trade by developing a clear UK post-Brexit trade strategy to minimise uncertainty. This should include trade defence instruments against Chinese dumping, as well as maintaining single market access vital to steel and related sectors such as automotive.

3. A positive procurement policy to ensure domestic steel is used as far as possible in public projects, including enforceable rules and greater use of the ‘Kite Mark’ certification system

4. A national review of business rates, removing the perverse incentives that punish investment in capital by steel producers, while compensating Local Authorities to ensure no loss of income.

5. Supporting supply and value chains within steel and the wider manufacturing sector. The Government should take a more strategic view, incentivising key areas of supply chains to re-shore in the UK so fewer steel products are exported abroad for final processing.

6. For advanced economies like the UK, industry needs constant innovation to improve productivity and remain competitive. The Government must take a strategic role in supporting R&D and upskilling of the workforce, while also ensuring support for skills retention and “short time working” tied to training and up skilling, enabling companies to respond to fluctuations in the market without cutting jobs. The report calls on the government to provide support for investment by creating a National Bank for industry. A ‘Steel Catapult’ is essential to provide a base for new ideas and the report calls on the Government to override vested interests to support this.

7. A more collaborative relationship between industry and the trade unions, working together to develop a national industrial strategy which includes worker representation on boards. The report also calls on the Government to provide financial support for mothballing in incidents of plant closure and for the workers made redundant to ensure skills are not lost.