Ministers too slow to wake up to steel crisis, say MPs

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The Government failed thousands of steel workers by not being alert to alarms raised by the industry, according to a group of MPs.

Other European countries were far better prepared and took action to safeguard their steel industries, but there was “little action” from the UK Government, said a report published by the Commons Business Select Committee.

The Government was also criticised for failing to push the EU into action as cheap Chinese imports flooded the market, making British factories unsustainable.

Only last week did the EU approve state aid compensation for energy-intensive industries, worth around £300m a year, including £45m a year to steel firms. But the money came too late to save the thousands of jobs already lost following the SSI plant closure in Redcar, along with other cuts in Scunthorpe and Lanarkshire.

Other moves by the Government have included a reduction in tax such as business rates, which ministers said would create greater certainty around energy costs.

Iain Wright, the Labour MP for Hartlepool, who chairs the committee, said: “The steel industry is on the verge of terminal decline. For too long, the Government failed to be alert to the alarms raised by the industry and act to maintain a steel industry in the UK when other European countries were acting to safeguard their own strategic steel industries. The Government has now woken up to the steel crisis, but this recent activity still needs to translate into concrete results for the industry and the communities they sustain. The Government has relied on crisis management rather than engagement with the steel industry.”

The report said the Government’s initial response focused on compensation for workers rather than trying to save steel plants. The issue of Chinese steel dumping would have to be tackled if the UK steel industry was to have a viable future, it added.

A spokesman for the Business department said: “We have taken clear action on relief for energy costs, anti-dumping, procurement and EU emissions directives, meeting key industry asks.”