Last week, the Government announced that it had agreed to provide £500 million of capital expenditure support to Tata Steel’s £1.25 billion proposed project to move to low carbon steelmaking in Port Talbot, subject to the necessary information and consultation processes that will be led by the company in a deal that will also see wider regeneration of the site. As we in Corby know, steel production at Port Talbot is absolutely critical to the supply chain for our works here in Corby.
There is no doubt that the industry has recently been acutely impacted by wider geopolitical and macro-economic developments that have made traditional, blast-furnace steelmaking financially unviable. The global steel market has become saturated with heavily subsidised, carbon-intensive steel, whilst President Putin’s invasion of Ukraine has dramatically increased energy costs.
Welcomely, however, as we have consistently, and working with constituency MPs like me, this Conservative Government will continue to stand by our steel industry, and this deal is part of our long-term plan for UK steel.
By way of background, this ambitious transformation is the culmination of several years of negotiations between the Government and Tata Steel, and is one which, as I understand it, has been backed by a majority investment by the company. This transition has:
1. Secured continued production of steel at Port Talbot at a time when it was facing collapse.
2. Enabled the industry to take a significant step towards decarbonising.
3. Provided a clear pathway towards a long-term financially and environmentally sustainable business model, removing the repeated need for Government intervention.
This package represents one of the largest support offers in recent history and will secure long-term jobs, not just in Port Talbot, but across all of Tata Steel’s sites in England and Wales, including Llanwern, Troste, Corby, Hartlepool, Shotton and Shapfell. It is a deal that not only safeguards jobs, but one that will help build greater resilience in the UK economy and will help create new opportunities in our construction, automotive and energy sectors. The regeneration of Port Talbot also means that there will be more opportunities for new businesses to emerge in areas such as scrap, to support new production methods, and will build greater resilience in the economy as green steel begins to support our construction, automotive and energy sectors. This new era for Port Talbot will be a major development and will stimulate growth through creating new high-paid, high-quality jobs in new sectors and through the release of land for new industries.
I am pleased that Ministers are determined to work closely with the industry and local communities as the nature of some of the work changes, to mitigate any impacts, including reskilling, whilst utilising the site to drive new business opportunities, jobs and economic growth, alongside steelmaking. I have always argued that steel is a strategically significant industry which plays a vital role in the UK economy. That will not change. But decarbonising UK industry is central to the UK’s net-zero target to tackle climate change and modernise our steel industry for the 21st Century. This week's news is therefore very welcome, providing greater certainty as to the future of this pivotal, foundational industry nationally, with all the benefits that brings for Corby; not least as it works to become the first 'green steelworks' in the country, with a clear plan in place to get there.
As local people know, I always have, and always will, back our steel industry - and this week's announcement proves the Government continues to do so too.