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Autumn Statement – Support the steel industry

Community
Community
24th November 2015

Tomorrow, the Chancellor of the Exchequer, George Osborne will deliver his Autumn Statement. He will use it set the direction of government spending for the course of this parliament.

In advance of this statement, Roy Rickhuss wrote to the Chancellor outlining the support that Britain’s steel industry needs to survive. See this letter below…

 

Dear Chancellor,

Autumn Statement 2015

I am writing to request that you take immediate action to support the UK steel industry and the many thousands of people whose livelihoods depend on it.

You may recall that prior to the 2014 Budget I wrote in similar terms to impress on you the urgent need for decisive government action to alleviate the pressure building on the steel industry. Since that time we have seen the industry descend into crisis, with in excess of 5000 job cuts announced in the last two months alone and strategic industrial assets lost to the UK forever.

The steel crisis shows no signs of abating and indeed has the potential to gather pace, with the UK’s system of green levies a major contributing factor. UK steel producers are at the top of the global league table in terms of energy and carbon efficiency, and steel must be part of any low carbon industrial strategy and solution to climate change which avoids carbon leakage of jobs and economic capacity. However despite our steel industry’s environmental credentials UK producers continue to be clobbered by green levies introduced by successive UK governments. To give one example, since I last wrote UK steel producers now have to meet the cost of the Industrial Emissions Directive, which are predicted to add a further £500 million to costs by 2020.

The UK steel industry is not asking for handouts but it desperately needs government to act to enable us to compete on a level playing field with our overseas competitors. The situation is critical and on behalf of UK steelworkers I would ask that you take the following actions in your forthcoming Autumn Statement:

  • Scrap the Carbon Price Floor – a unilateral UK tax severely damaging our competiveness in the global marketplace
  • Commit to undertaking a comprehensive review of the impact of green levies going forward to 2050 (by which time global steel production is forecast to increase by 70%)
  • Remove plant and machinery from business rate calculations to bring the rates paid by UK steel producers more broadly into line with our European competitors

Finally, with regards to the Comprehensive Spending Review, I would ask you to reaffirm the commitment given by the Prime Minister to bring forward from April 2016 and in full the compensation package for Energy Intensive Industries. I would also ask you to provide certainty to industry by confirming that the full package will stay in place until at least 2020. I do not wish to see the future of our industry, which employs 30,000 well-paid highly skilled people and in 2013 made a £9.5bn contribution to the UK economy, placed at risk due to competition between government departments in the race to slash public spending.

Thank you for taking the time to read this letter and I look forward to hearing from you.

Yours sincerely,

Roy Rickhuss
General Secretary