[R] signifies the Member has declared an interest. [W] signifies that the question was tabled in Welsh.

I have accepted an urgent question under Standing Order 12.66 and I call on David Rees to ask the urgent question. David Rees.

Following today’s announcement on the steel ballot by the Tata workforce, will the Cabinet Secretary make a statement on what discussions he has had to ensure the commitment to the investment in steel making at Port Talbot is secured? EAQ(5)0122(EI)

We welcome this afternoon’s announcement by the steel trade unions that their members have voted in favour of Tata Steel’s proposals to secure the future for its UK operations. This announcement is a significant step forward in securing a sustainable future for the UK businesses.

I thank the Cabinet Secretary for that answer, though I need to expand a bit on my original question. But I’m sure he appreciates that, since January last year, there have been some very dark skies over Port Talbot and the steelworks there, the local community and the local economy. We’ll now seeing, perhaps, after this ballot, the lifting of those dark skies and greater certainty over the medium term starting to be visible.

Now, steelworkers have given Tata an opportunity to rebuild the confidence that they have lost, or at best strained, over the recent months, and I hope that Tata take that opportunity and deliver on the promised investment as soon as possible, along with the other points in the proposals, including equality and parity with plants across the EU for their workforce.

Now, workers have made sacrifices to put the priority of the industry at the fore and I hope that, perhaps, the Welsh Government will lead on ensuring that those priorities and the interests of steelworkers are at the fore. Cabinet Secretary, I’m sure you agree that that needs to be across all parties, not just the Welsh Government, but the UK Government and Tata itself.

Can I put on record my recognition of the hard work and commitment by the trade unions, who have made some very difficult decisions during this time in the interests of their members and of the industry? But Cabinet Secretary, today’s ballot result is only a step on the path to a long-term sustainable future here in Wales and across the UK, and we still have far to go as a consequence of that. So, can I ask the following of you: what discussions have you had with Tata on their investment plans and the timescales associated with those plans? And have you received any assurances from them in relation to delivering their commitments on that proposal? How quickly can you as a Welsh Government be in a position to actually support investment? I know you’ve already committed £12 million, but how quickly can you commit other funding to other aspects, whether it be for research, for plant, training or other areas that help the industry? The spectre of the ThyssenKrupp joint venture still hangs over the whole industry and existed throughout the ballot. It hasn’t gone away; it’s still there. So, what discussions have you had with Tata regarding the implications for such a joint venture, particularly for the Welsh steel industry and the workforce? Have you had discussions with the UK Government, because the levers for many of the issues now faced in the steel industry are with them? What discussions have you had with the UK Government on their actions, because to date, to be blunt, I have seen very little action from the UK Government, to ensure that they now play their part in making the steel industry here in Wales a secure steel industry, one that is fit for the future and one that will continue to deliver? The workforce have done their job. They’ve committed the last four months. They’ve delivered production levels beyond the highest levels. They have actually even supported this ballot at a cost to themselves. Surely, your discussions should be telling the UK Government to stand up and take action. We want that action. Steelworkers want that action. Can you tell me what they’re doing?

I think it’s important to recognise the enormous step the workers have taken in voting the way that they have and I’d like to pay tribute to the employees of Tata in Wales and also to the trade unions who have conducted themselves on behalf of the workers over many, many months in the best possible way imaginable. It has been an incredibly difficult time. This is the latest, albeit very welcome step, just the latest step in what has been a very long campaign to make the steel sector more sustainable for the future. But it’s been a campaign that Welsh Government has led, of that there is no doubt. We’ve done our part in offering a package of £60 million with conditions attached. Trade unions have done their bit, and today we’ve heard that workers have made a sacrifice also in order to do their bit and to make the sector more sustainable to make it more competitive to give it a future.

We now expect Tata to make good on its part of the deal with workers, but we also now expect the UK Government to take action. I’ve already spoken with the Secretary of State for Wales and I will also be writing to the Secretary of State for Business, Energy and Industrial Strategy to convey again my desire to see the UK industrial strategy demonstrate a more muscular interventionist approach to steel. We can only wish for some of the levers that they have at their disposal. They have those levers. We expect them now to use them. We expect them to use the industrial strategy to support the steel industry. We expect them to take action in terms of research and development. We expect them to take action in terms of high-energy cost, not just for steel but all energy-intensive operations.

In terms of the time frame that the Member raised—discussions have taken place with both myself and the First Minister; we regularly meet with the most senior officials from Tata—we expect, as I say, the promise, the pledge, the deal that Tata have offered to be delivered at the earliest opportunity. We certainly will be able now to expedite some of the proposals that have been put to Tata as part of the £60 million package. So, I hope to be able to bring forward announcements as soon as possible on further capital support for sites and also projects that will improve energy efficiency.

In terms of discussions with ThyssenKrupp, this is a commercial matter for Tata, but the conditions that we apply to the support that we’re offering will remain, whatever the future brings. I have also requested meetings with ThyssenKrupp to gain assurance from them about the Welsh skills sector if the joint venture were to go through.

I’m firmly of the belief that the steel industry in Wales has a very bright future, provided we get the investment and the interventions at a UK level that are required and that we’ve called for for many, many months. I do believe that, over the next five years, with the £1 billion investment that we expect Tata now to deliver, that the industry, with our support, will become more competitive, that it will modernise, that it will become more sustainable, and that there will be a long-term future for steel in Wales.

Thank you, Cabinet Secretary. Today, obviously, as has been said, we’ve had the consultative result of the ballot. It’s clear that, despite what was a stark choice for the Tata workforce, one that was a choice between pensions and future investment in the plant, they’ve decided to keep their faith in Tata Steel. But would you agree with me that now it is time for Tata Steel to step up their side of the deal in relation to investment?

We shouldn’t be under any illusion at the moment that we can put this issue to rest, I think. On pensions, for example, I understand that Tata are currently in talks with the trustees and the pensions regulator as they say they can’t afford to continue sponsoring the scheme, as we all know. They want to walk away from the scheme as is and it could still go into the pension protection fund. The regulator at the moment won’t allow for that to happen as Tata are actually making a profit, but the regulator is already looking at this issue and it could take another year for this to be rectified, I am told.

So, the proposals that the workers were balloted on are conditional on a sustainable solution for the British Steel pension scheme. So, with that in mind, and with that conditionality in mind, if Tata are not allowed to walk away from their pension obligations by the pensions regulator, or negotiations take longer, what do you understand happens to these particular proposals? Do they still go ahead even though Tata haven’t got a sustainable solution to the scheme? What discussions have you had personally with the pensions regulator and Tata on this?

What actions will you take immediately to make it clear to Tata that, as a Government, you expect them to reciprocate the faith that has been placed in them by the workforce ballot today? Are you going to now step up as a Government and honour the commitments you made to the workforce before the ballot, including action, as was mentioned earlier, on funding for a local power plant and more investment into the steel research and development centre? I think it’s vitally important for steel to be a priority and not a low priority grade, as we’ve seen from the UK Government’s leaked document last week in relation to it being downgraded as a priority, and I’d be interested to hear views from the Conservatives here today as to why they think that it has been downgraded as a priority. I think what everybody wants in this room is to see a sustainable future, but I don’t think we should be under any pretence that this is the end of the discussion here today. Despite the vote, Tata may not be in a position to change the pensions, and therefore the investment may not follow. And I think that is what people need to have assurances on and need to have leadership from you and the UK Government and Tata on taking this issue forward now.

Can I thank the Member for her questions and contribution, but I do take issue with the demand that we, Welsh Government, should show leadership now and step up to invest in the sector? In December, we announced the first package of support that was being invested in our sites. That included £4 million investment in skills development—not just at one site, but at every single site across our country. It included £8 million towards an £18 million investment in the power plant at Port Talbot to reduce energy costs and cut carbon emissions. And now, as I said, we are ready to take forward a series of other measures that will improve energy efficiency at Welsh sites, we’re looking at a capital expenditure programme at Shotton, and also improvements to the galvanising line at Port Talbot. Today’s decision has meant that we can expedite that work and give workers the confidence that they will be operating in modern facilities that are competitive.

In terms of Tata itself and the confidence that needs to be built amongst its workforce, there is, of course, a need now for Tata to demonstrate its loyalty to Wales, to the workers who have shown such loyalty to the sector in voting the way that they have, and they offered a deal concerning pensions that they assured workers would be sustainable. It’s now for them to prove it and to deliver it, but it’s also for them to deliver the investment that we are working in partnership with them on.

Minister, thank you for giving your answers to the urgent questions so far, and could I join you in commending the workforce for the way they’ve resolutely—[Interruption.] I don’t know what the sniggering is, but at the end of the day, I think the workforce have stood up and put their point over and actually endorsed the ballot today, with over 70 per cent in all three categories, I think, from the various unions endorsing this, with over 70 per cent turnout as well in this ballot, which is a resounding commitment from the workforce. What is important, now, that we hear from, obviously, Tata, is how they are going to bring forward the investment that they’ve talked of, and you highlighted in your earlier answers that you and the First Minister are in constant dialogue with senior directors of Tata Steel, so could you indicate how that pipeline of investment will now come on-stream, given that, I think, the figures are commented on are £1 billion over 10 years? Is that £1 billion front-ended, so that we will see a considerable chunk of that investment in the early years of that 10-year period, or is it going to be more towards the mid to long-term future when we’re looking at the 10-year period of investment we’re talking of?

And secondly, the merger talks are continuing and ongoing; are the assurances around no compulsory redundancies caveated with the fact that Tata need to be remaining in control of the plants and, if a merger was to take place, then the assurances around compulsory redundancies would not be placed on the successor company if—if—a merger were to take place? We are all pleased with the situation we find ourselves in today, given where we found ourselves 12 months ago and, indeed, through the Assembly election campaign, where all parties worked together on this and the community as a whole worked together on this, and the productivity of those discussions, those negotiations, have borne fruit today. There is still much work to do, and I will work with colleagues both in Westminster and in this institution, along with other Welsh Conservatives here, to make sure that there is delivery around high energy prices, but above all, make sure that investment is made in these plants to secure steel as a primary industry. But I do hope that, rather than reverting to the trench warfare of the politics of this, we can continue working together to make sure that the steel voices are heard and that decisions are made in the best interests of securing the long-term future of the steel industry here in Wales and in the UK. Let’s not forget that one of the key numbers that have helped this commitment to come forward is the depreciation in the pound, which has made steel-making profitable again in many of the plants the length and breadth of this country.

I’d like to thank the Member for his contribution. I will just point out that the fall in the value of the pound has actually impacted adversely on raw materials that have to be imported so, actually, the benefits are not as you would imagine. But I do welcome the collegiate approach from the leader of the opposition on this issue, and what he said about the need to avoid trench warfare. In order to maintain this, I think it might be worth the Conservatives recognising the incredible role that Welsh Government has played in ensuring that steel has a sustainable future. And another important role—and I look forward to working with opposition Members on this—is to ensure that the UK Government now delivers for steel in Wales and, in particular, I am intrigued by the potential of a steel deal as part of the UK industrial strategy. I very much hope that that will be delivered as soon as possible, and will have considerable benefits for Wales. There is, of course, a £2 billion research, development and innovation fund that’s been announced and, again, I would hope that all Members will be able to work together to secure as much of that investment as possible for Welsh steel.

There are four key elements to the proposal, and the Member highlighted a number of them—first of all, the investment component: the 10-year plan to invest £1 billion to support steel making at Port Talbot and secure the future of the downstream sites. Now, we will be having discussions with Tata about the time frame and the expected investment over the next 10 years, but it would be our expectations that they ensure that the facility becomes more competitive at the earliest possible point. Port Talbot is already turning a corner at great speed, thanks to the bridge—the programme that has been introduced by local management, and that has been supported by employees and the unions. Together, they’ve formed a formidable partnership. It’s a partnership that’s seen the result that has been announced today, and we very much welcome it.

In terms of the pledge for jobs to be secured, Tata, as part of the agreement, agreed to a pact equivalent to its agreement with steelworkers on the continent, which includes a commitment to seek to avoid any compulsory redundancies for five years. In terms of joint venture discussions, I’ve already made clear that the conditionality that we apply to our investment in Tata’s steel sites in Wales would continue to apply, regardless of future ownership. But for the next five years, what those conditions do is ensure that the steel sector in Wales, led by Tata, can continue to modernise, become more competitive and become more sustainable.

Along with workers from my constituency in Trostre and in Port Talbot this afternoon, I breathed a very heavy sigh of relief at the ballot result, and it’s testimony to the commitment of the local management and the workers that, despite the grievances and misgivings they had about the way Tata has handled this over the last 12 months, they’re prepared to make a commitment to save jobs in their communities. And I think we should acknowledge that were it not for the financial inducements of the Welsh Government, there wouldn’t have been a deal for them to vote on in the first place.

But I wonder if the Minister does share my unease at the events of the last year, and of the calls from the Chamber this afternoon to continue to pump large amounts of public money into a large multinational corporation on an ongoing basis? This makes us incredibly vulnerable to the whims of a boardroom in India and the changes of personality around that board table. We surely must be putting ourselves in a better long-term position that we make ourselves less vulnerable to these forces beyond our control, and we build up the resilience of our economy through local investment, local skills and local jobs. So, would he make sure in his economic strategy that we do have a plan, so that we don’t put ourselves in this position in the years to come?

Can I thank the Member for his questions, and also for recognising that the deal is indeed only possible today because of the investment and the leadership shown by Welsh Government over the past year and more?

In terms of the question of ownership that the Member raises, the key to a prosperous and secure future for those Tata Steel plants lies in them becoming highly competitive, up there with the world’s very best. That’s what our investment is about, that’s what our support is all about: we are investing in the people, in their skills. I’ve already reiterated the point today that we announced in December a £4 million package of support to develop those skills. We’re investing in the local plants and in local jobs.

So, above all, what is essential is that we give the steel sector across Wales, regardless of who owns which sites and which facilities, we give it the best possible chance of being as competitive as possible.

Cabinet Secretary, the brave decision by the Tata workforce to accept the Tata deal will help secure the future of steel making in Wales. It is now up to both Governments, in Westminster and in Wales, to help ensure that demand for Welsh steel is increased.

As discussed in the tidal lagoons debate here yesterday, Tidal Lagoon Power hope to source most of the steel from UK sources. However, there are concerns about this, given the fact that their major partners are a steel producer in France and Holland. What discussions have you had with the UK Government about ensuring that the tidal lagoon in Swansea uses only Welsh steel?

Can I thank the Member for her question? So, there are actually much wider implications for all industrial sectors, because procurement is a key issue in ensuring that the supply of Welsh steel is to a number of our major infrastructure projects coming up in the coming years.

We need to ensure that there is demand for Welsh steel right across Wales, and across the UK. This is something that I put to the Secretary of State for BEIS, and, of course, I know that the Secretary for Finance and Local Government has been doing a considerable amount of work in looking at procurement rules, and ensuring that Welsh steel can be used wherever and whenever possible on infrastructure in our country. And I think that a case in point is, actually, the eastern bay link road where more than three quarters of the steel used that will remain in situ comes from Welsh steel plants.

I’d like to re-emphasise what my colleague for Aberavon has said and others this afternoon, that Tata must now honour their commitment and promises, and recognise the sacrifice the workforce has made, and step up to the plate and not walk away from their obligations. I’m also adding my voice to tributes to the dedication of the steel unions. I know first-hand how hard the reps work at my local site of Shotton, and I will continue to work closely with them going forward.

Tata, I think, also need to adapt to better recognise the success at Shotton, which produces viable and innovative products in its own right. So, Cabinet Secretary, I can’t emphasise enough how successful and viable and profitable Shotton is, and I’d ask you to reaffirm your commitment to support an investment in the future of the site, and also working with UK Government to deliver on the steel sector support package.

Can I thank Hannah Blythyn for her questions? Shotton, like all other sites in Wales, is vitally important to the Welsh steel family, and that’s why I am pleased to be able to take forward work now on the potential support for a major capital expenditure programme at Shotton steelworks. I would also like to say that the steel unions at the Shotton plant, along with steel union representatives at all of the other Welsh sites, have conducted themselves in an exemplary way and have shown incredible leadership over what has been an intensely difficult period of time.

Cabinet Secretary, I think it is right today to recognise the commitment to the steel industry of the workforce, the trade unions, local management and Welsh Government, as other Members have stated. For me, of course, Llanwern is a real priority and a major concern, and, as with other steel plants, the workforce at Llanwern have shown great commitment over the years, constantly retraining, adapting to new systems, showing great flexibility and, it must be said, enduring successive cuts to jobs and production. But, we know that the steel industry is an industry with a real future in Wales, as well as a great history and past. So, as with Hannah Blythyn, I would like to plead the case for my local steelworks, indeed, as with Lee Waters and others.

So, in addressing the future plans for investment, Cabinet Secretary, of Tata in Wales, will you make sure that Llanwern has a strong focus and a strong place in the discussions that you have? Particularly, of course, because, as Tata are very clear in saying, it is an integrated operation in Wales and all the component parts from Port Talbot, across the length and breadth of Wales, work together and operate in an integrated way. I think it’s clear that we have to ensure that all the component parts are a significant part of the discussions that take place and not overlooked in any way.

I’d like to thank John Griffiths for his contribution and I agree entirely. I’d like to thank him for his consistent and passionate commitment to the plant in his constituency, as I’d like to thank all Members who represent areas that have steelworks within them. I do believe that we’ve only just scratched the surface of the potential of steel as a material. The amount of research and development and innovation that can and, I’m sure, will take place in the coming years will mean that the material plays a more significant role in the future than it does today.

The aim for Welsh Government is to place Welsh steel at the very forefront of research and development and, for that reason, we’re not just looking to invest in R&D and innovation within Welsh steel and within the Tata facilities, we’re also looking to the UK Government to do likewise. So, I do expect, as I’ve said already, a very fair share of that chunk of £2 billion of research and development money to come here to Wales for the Welsh steelworks.

I thank the Cabinet Secretary.