1. What assessment has the Welsh Government made of the announcement that the joint venture between Tata Steel Ltd and Thyssenkrupp AG is likely not to be approved by the European Commission and thus any further process on the joint venture will be suspended? 310

Can I thank the Member for his question and assure him that I've spoken with Tata Steel and with trade union representatives, along with the Secretary of State for Business, Energy and Industrial Strategy? It's too early at this stage to say what this might mean for Tata Steel in Wales, but of course, Llywydd, this Welsh Government stands ready to secure a sustainable future for iron and steel production in Wales that protects employment and steel communities.

Can I thank the Minister for that answer and the commitment he's given to supporting the steel industry here in Wales? Now, many will remember that, in 2016, the beginning of it, we saw the threat of closures of Port Talbot works. Following the decision by Tata then not to close it, in the commitment to seek a joint venture or merger with ThyssenKrupp, indicating it would be that offer that would give steel making a strong future, the trade unions accepted that—maybe reluctantly, but they accepted it—and that was reinforced this week by the Tata Steel European Works Council in the 10 May statement, saying that they supported that path. Now, that's gone, and I agree with your statement yesterday, and I thank you for that statement. It's a worrying time; there's no question about that. Grey clouds are once again on the horizon over Port Talbot, with the fear that they're moving in our direction. I think it's time to have cool heads, as you pointed out. It's not time yet—take time; cool heads. We must look and set out our own visions for ensuring that Wales has a sustainable steel sector.

I also agree that UK Government has a critical role to play in this, and you highlighted those points, whether it's a steel sector deal they need to get on with, or whether it's the attack on high energy costs, which we've been calling for for many years so that we can strengthen the financial position of companies in steel. That's one agenda. But I want to ask: what are the intentions of the Welsh Government to support the sector? You've done a fantastic job to date. I can't dispute the support this Government has given, both in this Assembly and the previous Assembly, to the steel industry, but we now need to see where we're going. I haven't seen a specific Welsh steel strategy, so can I ask whether you will be publishing a specific Welsh steel strategy for the future? 

Can I also say that steel is being supported by increasing income? You know, we talk about costs—lowering costs—but we can also talk about increasing income. One of the ways of increasing income is improving investment through CAPL galvanising lines in Port Talbot, for example, so the higher end products become more expensive and you get more money in as a consequence. So, the question I'm asking is: are you looking at future investment into the sector? Are you going to look at greater use of research and development? Are you going to be innovative and creative in your approach to supporting environmental projects? Because we've often argued that it's state-aid rules, but there are ways around state-aid rules so that you can help companies—environment and R&D being two of those ways. Now, both of those, actually, will help not just the industry but actually help constituents in my town on a wider basis as well. So, again, will you look at that and can you tell us what your plans are for that type of approach?

Can you also—? We've had people call for a summit from the First Minister. Well, to be honest, steelworkers and their families in my constituency don't want more talk. They want positive action that will remove the uncertainty they are now facing. That's definitely returned. We know it's there. We are fearful that it's there. We want a commitment from the Welsh Government of that continued support, and I want to ensure that, actually, perhaps that can be reinforced by somebody going to Mumbai to talk to the Tata board in India to reinforce the commitment this Welsh Government gives to the steel industry here in Wales.

Can I thank Dai Rees for his question and, as always, the passion with which he speaks for Welsh steel and iron facilities across the country? I'm going to touch on a number of really important points that he has raised, including investment by Welsh Government and the role of UK Government, but, first, can I say that, in terms of any grey clouds on the horizon, we are in a different place to that which we occupied in 2016? We are not back to the same position as in 2016, and that's largely as a consequence of the investment that Welsh Government immediately offered to Tata, some of which Tata has drawn down and much of which Tata has matched with investment, to ensure that primarily the Port Talbot operation is more efficient and sustainable. In turn, I think it's absolutely essential that no rushed decisions are made, and this was something that I pressed upon Tor Farquhar when I spoke with him on Friday. It was a message that clearly came from the European Works Council as well, on Friday. It's my intention to travel to the Netherlands to speak with executives to ensure the message that no rushed decisions are made and also that the steel footprint of Europe is secured and not dismantled, as far as Tata is concerned.

I'm going to move on to touch on the role of UK Government. Dai Rees rightly raised the important need of a sector deal for steel. This is a matter that I raised with Greg Clark when I spoke with him on Monday. Clearly, a sector deal is needed that can lead to significant investment in the sector. It requires UK Government funding, and it also requires funding from the sector itself. I am hopeful that we can, working together, ensure that a sector deal is delivered. But, that won't be enough in its own right. There are clear and immediate challenges concerning energy prices that need to be addressed by the UK Government. While I welcome the announcement in the 2018 budget of an industrial energy transformation fund, that in itself will not deal with the volatility within the energy markets, nor will it deal with the disproportionately high prices that energy-intensive companies in the UK have to shoulder. Therefore, the UK Government must do more on this vitally important matter.

In terms of the support that we have given and will continue to give, I can assure the Member that we stand ready to help in any and every way, just as we said that we would back in 2016. We have offered £21 million to date to Tata, covering a range of functions and modernisation programmes, including skills training and, importantly, research in development, which the Member pointed to. The strategy, going forward, for steel is encompassed within the economic action plan. We wish to support the industries of tomorrow by ensuring that they are decarbonised, that there is heavier investment in research and development, and a stronger focus on export opportunities. Through the prism of the economic contract and the calls to action, we will ensure that those industries of tomorrow are modernised and competitive. But to do so with maximum effect, we need to ensure that businesses themselves are willing to invest. That's why my message to Tata will clearly be: continue the investment—not just in Port Talbot, where it is vitally needed, but across the entire estate in Wales and, indeed, in England.

Can I just say thank you for reassuring us that we're not back in the same position that we were in in 2016? I think the investment in the blast furnace and, actually, the company's interest in producing more of its own energy are a good sign that that's actually the case. I just had a couple of questions, because my colleague Russell has some as well. I suppose I'd like to repeat some of the questions that I asked when the merger or the joint venture was looking as if it was very probable. One of the things that I asked at the time then was: what's likely to be happening with R&D? I think you might have answered that in response to David Rees. At the time—I think it was in response to an emergency question or a topical question from Helen Mary—you said that you would be circulating a note of the conditionality of the terms that have been offered to Tata already. At the time, we were asking, 'Well, will they apply to a merged venture?' But, I don't think we've had that note yet, and I think that it would be useful, not least because it will stop us asking this same question over and over.

On the principle that I'm asking the same questions that I would have asked if there had been a merger, you did say at the time that you were hoping that the employment pact would be extended to 2026 with the joint venture. If that doesn't happen, would you still be seeking that extension from Tata as it is—on the same terms, probably? You also mentioned the competitiveness of Welsh steel—that what we're looking for is something that's efficient and productive. I suppose that what I'm asking is, is there a plan B here? Say this merger doesn't go ahead, I think that what I'm seeking is that there has been some sort of reassurance about what would happen if it doesn't go ahead, in the sense of, are there any escrow agreements drawn up about an extension to an employability pact? Was there anything else that was done in draft, if you like, so that, should the merger not go ahead, we weren't immediately just thrown back into a position where we were all asking, 'What next?' Now, I appreciate that it is a bit too early to be asking that question, but I would have liked to be certain that there was a back-up plan. I suppose that's what I'm asking. I think that that's all I want to ask at this moment. I will be listening to what other Members say as well—particularly, I suspect that Trostre might come up in other people's questions as well.    

I was keen to understand what the alternative plan might be as well when I spoke with Tor Farquhar on Friday, and he assured me that the endgame, the ultimate goal, remains the same, and will remain the same, and that is to ensure that sufficient investment is made, particularly in Port Talbot, to give Welsh steel and iron making a sustainable and strong future, and of course we have a role in that. We've already played a part in that; UK Government must play a part as well, and that is still the plan. Therefore a plan B is not absolutely necessary at this stage because Tata are still in a position to be pursuing the goal of sustainable production.

In terms of the conditionality that's attached to our support, I'm sorry that you've not received a note. I assure you that the details that we are able to provide to you we provide to you in a timely fashion, but the conditionality relating to employment will continue, regardless of what happens with the merger, and I think it's absolutely right that we do apply tough conditions. And it's right that, whilst Tata's been able to draw down a significant package to date, the remaining funding that we have put on the table is met with a willingness to commit to employ dedicated, loyal and skilled staff for a good number of years.

I'd like to pick up on your comments that you will be heading to the Netherlands to speak to Tata executives there and to just ask you what discussions you have had to date with Tata operations outside the UK, not just on a European level, but worldwide, too. There is an article on Bloomberg in which Tata's chief finance officer has been quoted saying that Tata will be shifting its focus to the Indian steel market, and that the European operation must not draw resources away from the expansion in India, even going so far as to say that assets would need to be sold off to make business more profitable, putting the future of Welsh steel in even further doubt. I certainly would categorise that as serious clouds on the horizon.

Now, the collapse of the merger has meant that of course the European operation will in a way be more reliant on the Indian operation's resources, meaning that, in the near future, Tata could or will have to look at deinvesting in Europe based on the priorities set out by the chief financial officer. So I'd like your comments on that. Tata has also stated that they will also be looking at partnerships with non-European companies. Can I ask what discussions you have had with regard to that possibility?

On partnerships with non-European countries, we've asked about any alternatives to the proposed joint venture and merger. It's a commercial matter for Tata, of course, but we are keen to understand what alternatives there might be, and what interest there might be. That's one of the reasons why I'm keen to go to the Netherlands and speak with senior executives. The shifting focus away from Europe and towards India means that the steel family within the European Community will act more distinctively, potentially, in the future, and that is why I believe that engagement at a European level is absolutely right. We have good relations already with Ratan Tata and with senior executives in India. We stand ready to go to Mumbai if necessary. For the time being the advice that we've received from Tata is to ensure that we thoroughly engage at a European level. That's what we are doing, and that's what I'll continue to do.

Can I thank the Member, Dai Rees, for tabling this very important question? I also welcome the Minister's commitment towards the steel industry—continued commitment towards the steel industry. We simply can't afford a situation where we lose jobs in the steel industry like we did at Shotton in the 1980s. It's been a roller-coaster ride of uncertainty for workers and their families, so I do welcome again the Minister's commitment to ensure that they have the support they need right across Wales.

Minister, can I urge you to continue the work you're doing to ensure that we don't lose investment here, and maybe sit down with the Members who have steel in their constituencies post your engagement visit to the Netherlands? Also, just to focus on a few points that were mentioned earlier in this question, the UK Government does need to do more to address the underlying problems facing the UK steel industry, so would the Minister agree with me that it is the sky-high energy costs that are leaving steel makers within the UK and the European markets—? They're competing with the European market, leaving the UK steel industry with one hand tied behind their backs.

Finally, Minister, would you also agree that procurement is also important? We've got projects within the UK, like the Royal Navy's new fleet solid ships, which gives us an opportunity here in Wales, here in the UK, to use our steel. Overall, Minister, we do need to do more. The uncertainty for the families of the steelworkers needs to end, and we all need to work closer together to ensure that steel making is a success within Wales, as it can be, as it has been in the past, and as it needs to be for the future.

Can I thank Jack Sargeant for his contribution and for his questions? I can assure the Member that I'm maintaining a keen interest in all of Tata's sites across Wales, and tomorrow morning, I will be visiting Tata Shotton to meet with local union representatives and, of course, executives at the plant. I think it may be a timely moment for the cross-party steel group to reconvene here in the Assembly to consider the various matters that are being discussed this afternoon, and I would absolutely agree with the Member that sky-high energy costs are the major challenge, not just to Tata's operations, but to the whole of the steel community across the United Kingdom, and, indeed, to a huge number of energy-intensive firms. It's therefore absolutely vital that the UK acts on volatile and often extraordinarily high energy costs that leave businesses in Britain at a competitive disadvantage.

Jack Sargeant also makes the important point concerning procurement and, of course, there are some major infrastructure projects at a UK and, indeed, at a Welsh level that we would wish to see Welsh steel used in. For our part here in Wales, they include road-building projects, they include, of course, the metro as well. And at a UK level, projects such as HS2 should, in my view, utilise steel made here in Wales.

Minister, these are worrying times for the steel industry right across Wales, and, obviously, your concern is for all Tata plants right across the country, as you've stated. For me, obviously, Llanwern and the Orb works are particularly concerning because they provide many high-quality, well-paid jobs locally, and other jobs in the supply chain and so on depend upon them. The Orb works is up for sale at the moment, which puts it in a particular position. I just would like your assurance, Minister, that those plants will receive your full consideration in your work with Tata, with the trade unions, with UK Government, with local politicians and all others with a stake in these matters. And if you are meeting at plants in Wales, Minister, to discuss these matters, I'd be very grateful if you could also meet in my constituency. 

I'd be pleased to meet with the Member at the plant that he represents. I raised queries with Tata on Friday concerning all of the sites, and I was told that the Orb works sale continues. It's a different situation for Trostre—the disposal of that particular site is off the table if the merger doesn't go ahead. But I will keep Members updated regarding each of the sites whenever I receive information from my officials and from Tata, and, whenever possible, I will also endeavour to visit steel facilities in anyone's constituency.

The Presiding Officer has indicated that I must be short, and there are a number of questions around energy that have been asked this afternoon, but in terms of how the Welsh Government can help and support the industry in terms of business rates and help on business rates, I'd be grateful for any update in that regard. And also, have you any indication about how this announcement may affect the commercial investment to secure a long-term future for the Trostre site as well?

In terms of energy, of course, the UK Government, as has been said, have a huge role to play, but also I know that Members are keen for us to respond to the recently declared climate emergency. I think it's worth saying that, based on the recently published report from the Committee on Climate Change, it's very clear that it is in our interest to ensure that we do not lose steel making, even given the fact that it is a heavy carbon contributor. Why is that? Well, it's because the Committee on Climate Change clearly states that scenarios for reducing UK industrial emissions are dependent on retaining our industrial base and decarbonising it, rather than losing it to another country where it might not be decarbonsied. And, so, it's absolutely vital that we play our part, all of us, in ensuring that the heavier contributing industries in our country contribute less in the future, through investment. 

In terms of business rates, this is, of course, a matter that falls within the remit of my friend and colleague the finance Minister, and I'm sure that she'll be willing and enthusiastic to respond to questions concerning this matter. The most important thing for Tata, and the Member rightly raises commercial interest and commercial viability, the most important thing for Tata is that Tata Steel Europe maintains a focus on delivering the plan that was always in place, which is to ensure that sufficient investment is secured in order to modernise the facilities and to put them on a stable, long-term footing.

Thank you, Minister. The second topical question is from Rhun ap Iorwerth.