UK Steel Industry — House of Commons, 2015-09-17
Topic: Mixed Topics
Margaret Ferrier (Scottish National Party, Centre-left): I would like to put on record the fact that it I am delighted to be able to participate in the debate today, having been one of the lead Members to make representations to the Backbench Business Committee, along with the hon. Member for Redcar (Anna Turley). I would like to thank all those who supported the application, and all those who are attending and contributing today. I, too, am glad to see that we have a Minister here today who is listening to us on this issue I know all too well the challenges facing the steel industry. Tata Steel’s Clydebridge plant lies in my constituency, and its sister plant, Dalzell, is in the neighbouring constituency of Motherwell and Wishaw. Those two plants are part of the Tata Steel long products business As many Members will be aware, the history of the steelworkers industry in Scotland, in particular in north and south Lanarkshire, is extensive. The Clydebridge steelworks was first opened in 1887, and throughout the years it has had the status of being one of the giants of industrial Scotland. The steel plates it made were used in many of the most famous ships ever built, such as the Lusitania, Mauretania, Queen Mary, Queen Elizabeth and the QE2 From 1786 to 1978, the Clyde ironworks lay adjacent to Clydebridge and supplemented the work of the steelworks. In the Clyde ironworks, the hot-blast process was invented in 1828 by James Beaumont Neilson. This one invention led to a rapid increase in iron manufacture, and the growth of industries made Scotland a world leader in manufacturing Established under the Iron and Steel Act 1967, nationalisation tried to rationalise steel production and made the biggest changes to the British steel industry ever seen. Some 90% of UK steelmaking came together under the one single business, the British Steel Corporation Clyde ironworks was to be enlarged, and this led to the establishment of the Ravenscraig steelworks in 1954. It was based in Motherwell and had the title of being the steel capital of Scotland, and the skyline was dominated by the gas holders and cooling towers of the plant. Ravenscraig became the heart of the nationalised industry’s Scottish operations and produced its own iron in blast furnaces fuelled by Scottish coal. Iron ore was imported via a purpose-built pier terminal at Hunterston, and lime flux came from its own works in Westmorland. Ravenscraig became western Europe’s largest producer of hot-strip steel and produced slab steel for the Dalzell works, which is still there today On the watch of Margaret Thatcher’s Conservative Government, British Steel was privatised in 1988, a move that has left a legacy of decimation. With the privatisation came high manufacturing costs, the free market, overseas competition and a downturn in shipbuilding. This led to the closure of Ravenscraig in 1992, ending the large-scale steel making industry in Scotland. That was widely regarded as one of the biggest social and economic disasters to have ever occurred throughout the UK, and the steel industry has never been able to recover from this hammer blow The closure resulted in the loss of 770 jobs and another 10,000 jobs directly and indirectly linked. Ravenscraig at one point was regarded as the largest brownfield site in Europe. Fortunately, however, the Dalzell and Clydebridge plants have remained in operation under the ownership of Tata Steel Europe The UK steel sector currently employs about 20,000 people directly, which is just a tenth of the number who worked in it during the 1970s. Tata currently employs around 17,000 of them, down from 25,000 in 2008 When Tata Steel suffers, the UK steel industry suffers. Tata Steel posted a pre-tax loss of £768 million in the year to the end of March, double that of the previous year. Its revenues fell, down 7.3% to £4.2 billion, and production was down to 8.2 million tonnes, due to "operational issues" at plants. Tata Steel’s liquid steel has this year declined by 2.5% Tata’s European branch took a heavy hit when its Indian branch lost £314 million from restructuring and impairments. Tata Steel has been slashing costs since 2007, and 1,000 staff and agency jobs have been lost since last year alone. It has been stated that these losses have been the result of high taxes and energy costs, the strong pound and cheap Chinese imports, along with other external factors The Chinese Government have devalued their domestic currency several times throughout the year and this move has improved the competitiveness of Chinese exports. About half of the 1.6 billion tonnes of steel made worldwide each year comes from China, which is now exporting around 100 million tonnes a year as its economy slows.