UK Steel Industry — House of Commons, 2016-04-12
Topic: Energy
David Thomas Charles Davies (Conservative, Centre-right): I, too, want to thank you, Mr Speaker, for granting this important debate. Steel is a huge part of the economy of my home town of Newport. In fact, my first job was at British Steel. I declare an interest as a British Steel pension holder, although what that pension will be worth after all this, I do not know Members on both sides of the House have spoken very well. The hon. Member for Hartlepool (Mr Wright) made the point that the fundamental problem is the vast amount of steel that has been coming into the marketplace from China since about 2008, and the fact that the demand for it is just not there. In reality, as he says, nobody can do anything about that fundamental problem, but there are certainly things the Government could do to help. Tata was losing about £1 million a day—we had the figures a few weeks ago. Frankly, the Government are not doing enough to help; I will not mince my words today One problem is that there has been a lack of consistency on both sides of the House. We need to ask ourselves a fundamental question: do we want heavy manufacturing industries in this country? Of course, people say the answer is yes, and I think the answer is yes, but if it is, one has to ask why, over the last few years, Governments of all parties—this Government, the coalition Government and certainly the Labour Government—have enacted policies that have made it much harder for heavy industry to continue Those Governments swallowed lock, stock and barrel the idea that carbon dioxide is a pollutant that is causing runaway global warming, and they enacted a series of policies that made things very expensive for any industry that emits CO2, and made it expensive for heavy manufacturers to buy in energy. We have brought in renewables obligations and carbon floor prices, and as a result, we now have the highest energy costs in Europe. That point was made to us on the Welsh Affairs Committee by manufacturers and the unions. Dealing with the issue may not resolve the fundamental question, of course, but it could make the difference between an industry that is profitable in some areas and one that is not. It could also make the difference to companies such as Tata when they are deciding whether to maintain a plant here or in the Netherlands It is important that we think about things consistently. To be honest, I do not buy the argument that carbon dioxide is causing runaway global warming. I have spoken about this before, and I cannot deal with the issue in the next two minutes, but there is simply no correlation with the tiny increase we have had in temperature. Therefore, the Government need to rethink their policy. Instead of deciding to get rid of the carbon taxes and energy taxes that helped to create the problem in the first place—taxes supported by Governments and MPs of all parties—the Government have brought forward a compensation package. The package is all right as far as it goes, although it had to go through a great big bureaucratic steeplechase in the European Union, which Members on both sides also support, and which I certainly do not. However, having got there in the end, and with the first cheques going out as we speak, what have we actually done? We levied a huge tax on an industry, and now we will give some of that money back, because the tax is having exactly the impact we thought it would, which is to punish the industry. I put it to the right hon. Member for Don Valley (Caroline Flint) that it would surely be much more sensible to scrap the carbon taxes in the first place. There is not much point having a tax if one has to compensate people for its effect.