Steel Industry — House of Commons, 2015-01-14
Topic: Labor
Tom Blenkinsop (Labour, Centre-left): We have nearly reached the fourth anniversary of possibly the greatest feat of industrial escapology, when Teesside Cast Products was purchased by SSI on 24 February 2011, after nearly three years of solid fighting by its work force. At the heart of the campaign was the Community trade union. It is my pleasure to declare my interest as a current member of Community, the chair of its parliamentary group, and a former industrial regional officer who helped to save the TCP site I want to echo many of the comments made by my hon. Friends about the importance of steel to our local economy. I know that Tata and Community have worked closely and constructively, particularly since the worldwide recession in 2008, to manage a series of major restructurings. Under projects such as Weathering the Storm, Fit for the Future and Project Ark, thousands of steelworkers have left the industry, but they did so with the goal of keeping our industry going in the hope of expanding again later, when the recession was overcome, and most importantly, of retaining and perhaps recruiting to the industry It must, however, be said that the news in late October 2014 about the proposed sale of Tata’s long products plants in the UK has cast a shadow over Teesside and east Cleveland. I share the same thoughts as my friend and the Labour candidate for Redcar, Anna Turley—she has said that she is now most concerned for the workers at long products sites across the UK—as well as those of, among many others, Robbie Middlemass at Skinningrove special profiles mill, Peter Hobson at the beam mill and, of course, Paul Warren, who works at the South Bank coke ovens and is the multi-union chair at SSI. Some of them are with us in the House today Before the memorandum of understanding was signed on 15 October 2014, there was no consultation with the trade unions, despite the existence of long-standing information and consultation arrangements, both domestically and within the framework of the European works council. That followed Tata reneging on a nationally settled two-year secondment deal at Grangetown labs in September 2014, which was an early warning sign of a new tone, or lack of tone, from Tata. Communications between management and the work force were negligible, and Tata had had many clandestine chats with Klesch for some time What Skinningrove and the Lackenby beam mill produce has more than the balance sheet appeal that Mr Klesch requires; it impacts on daily life where I live. A long drawn-out process of due diligence has again unsettled that way of life for the workers and their families. They have watched workers at the ESCO works in Guisborough lose their jobs, and have wondered what will happen to them. Whether Mr Klesch picked that up during his 20-minute visit to the Skinningrove works—he never even went near the mill floor—is, at the very least, debatable What beats me is the logic of Tata at the moment. It has decided to consolidate its business around its strip division, which is largely based in south Wales and Ijmuiden, with a heavy focus on supplying the automotive sector. However, even now, the long products division in the UK was significantly more profitable than the strip division in the last financial year Tata’s subsidiary Jaguar Land Rover plans to build its new Jaguar F-Pace sport utility vehicle at Solihull, but the fact that it is aluminium-based indicates the direction in which the industry is moving. Tragically, that will come too late for the 500 aluminium smelters at Alcan in Northumberland, who have already lost their jobs owing to inaction by this Government. Aluminium is providing a serious challenge to steel strip. The reduction in energy costs through the development of smelters in low-cost energy countries is putting a strip-only strategy in serious doubt What makes the UK steel industry stronger is diversity within the steel portfolio. Those in the industry remember not so long ago having to defend Stocksbridge from closure. It is now booming within its sector. A diverse steelmaking sector provides mutual security for each steel division. When one does well and another poorly, they look after each other, much like in a trade union. Even more seriously, Klesch’s strategy of playing the raw materials market in order to make longs a success—a strategy that is based on cheap iron ore surpluses—is exactly the same strategy that other competitors will be using over the next two to three years. That strategy, despite the assurances, is not a panacea. Tata’s current diverse product mix within long products means that it is closer to the customer and can provide product-based bespoke solutions. Being a strip-only producer would make it difficult for Tata Steel to integrate into integrated construction solutions Inside the massive sheds at Skinningrove and Lackenby are human beings who are willing to work well for the benefit of our United Kingdom—men and women backed up by the spirit, traditions and history of Teesside, East Cleveland and our nation. The trade unions that represent those men and women have played a fighting role in preserving that heritage and protecting the jobs of their members. Those trade unionists preserved the history of an industry, an area and a nation. It was the Community union, led locally by Paul Warren and nationally by Roy Rickhuss and previously Michael Leahy, that spearheaded the fight to ensure that iron and steelmaking on Teesside did not die. It won that fight. The Government must help the workers to win the fight now.