As Brexit looms, AMs say: “Don’t forget steel”

(Title Image: BBC Wales)

The Motion

The Senedd:

 

  • Welcomes investment made by the Welsh Government to support a sustainable future for the steel industry.
  • Recognises the challenges facing the Welsh steel industry following Brexit.
  • Calls on the Welsh Government to continue supporting the Welsh steel sector.
  • Calls on the UK Government to address the high costs of energy facing the steel sector in the UK in comparison to the EU.

The Beating Heart

David Rees AM (Lab, Aberavon) described the Port Talbot steelworks as the “beating heart” of his constituency. It’s almost three years since an emergency debate took place when the future of the steel industry looked bleak. Fortunately, it’s now in a better position but there are other challenges looming: Brexit and high energy costs.

“….no amount of energy efficiency improvement will counteract having to pay 50% to 100% more than your competitors. At our Cross-Party Group on Steel, we were told that energy costs in the UK are 110% higher than France and 55% higher than Germany. There are worries that this is going to get worse, not better.”
– David Rees AM

With regard Brexit, there are a number of issues which could affect the steel industry including free movement of goods, tariffs, rules of origin, trade remedies, safeguards and research.

Suzy Davies AM (Con, South Wales West) said steel dumping was still a problem, while rules of origin had the potential to cause, “a massive post-Brexit headache for which we need a cure before it infests the rest of the economy”. There may also be a knock-on impact caused by shrinkage of the UK’s automotive industry. However, she was optimistic Wales could become a centre for research and innovation in steel – a key commitment of the Swansea city deal.

Co-operation

Rhun ap Iorwerth AM (Plaid, Ynys Môn) praised cross-party co-operation on steel which has seen additional investment secured – in particular, a £30million upgrade to energy facilities at Port Talbot – but the Welsh Government shouldn’t take their eyes off the ball:

“At the moment, it’s fair to say that we can be encouraged that some of the investments being made by the steel sector seem to be for the longer term; they do suggest an expectation of continuing steelmaking in Wales over, say, the next decade at least. But it’s essential, of course, that Welsh Government remains focused. It cannot afford in any way to take its eye off the ball on steel making.”
– Rhun ap Iorwerth AM

Caroline Jones AM (Ind, South Wales West) stress the need for a level playing field with the EU on tariffs after Brexit and wanted the UK to seek tariff-free agreements with the rest of the world.

Jack Sargeant AM (Lab, Alyn & Deeside) was proud of high-quality work undertaken at the Shotton steelworks. He also recalled the devastating impact the mass redundancy of 6,500 British Steel employees which need to be heeded:

“….let’s not forget that steel is either in every single product or in every single process in our current world….I think the Welsh Government has a great track record of backing the steel industry, and I know that under the guidance of Mark (Drakeford) and Ken (Skates), it will continue to do so. But it’s clear to me that support shouldn’t just happen when crisis hits, and the UK Government can learn and should learn from lessons of the past.”
– Jack Sargeant AM

Steel “shouldn’t be disadvantaged” after Brexit

Economy & Transport Minister, Ken Skates (Lab, Clwyd South), said the Welsh steel industry shouldn’t be disadvantaged by Brexit as an industry as a whole was highly dependent on free trade:

“After the UK and Ireland, the primary market for UK-produced steel is, of course, Europe. When we exit the EU, it is therefore vital that the steel industry is not disadvantaged through unnecessary trade barriers such as additional customs, tariffs, quotas or technical barriers to trade. The steel sector is highly dependent on free trade, but, equally importantly, on rules such as trade remedies that underpin this.”
– Economy & Transport Minister, Ken Skates

The Welsh Government continues to raise the issue of energy prices with UK counterparts, while there was a commitment to research and development opportunities as part of the UK’s industrial strategy.

The motion was backed unanimously.

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