So, we'll reconvene the Plenary proceedings this afternoon with item 3, which is a statement by the Minister for Economy, Transport and North Wales on Tata Steel. I call on the Minister for Economy, Transport and North Wales, Ken Skates.

Diolch, Dirprwy Lywydd. Tata Steel announced on Friday, 13 November that they have initiated discussions with SSAB Sweden regarding the acquisition of Tata Steel’s Netherlands business including, of course, the IJmuiden steelworks. In addition, they have initiated a process to separate Tata Steel Netherlands and UK business in the future. Crucially, Tata Steel also made it clear that they are reviewing all options to make the business self-sustaining without the need for any funding support from Tata Steel India in the future. The uncertainty around what this might ultimately mean for the UK business will undoubtedly cause deep concern for the 8,000 Tata Steel employees across the UK as well as their families, local communities and the significant numbers involved in their supply chain.  

The First Minister and I spoke with Dr Henrik Adam, chief executive officer of Tata Steel Europe, on Friday. Dr Adam explained that Tata Steel is determined to find a sustainable future for operations here in the UK and to safeguard the workforce. Dr Adam also made clear that the creation of a UK-only operation marks a critical point for the business.

Now, we must take this opportunity to create a sustainable, secure and successful footprint for Tata Steel here in Wales, one that is aligned with our low-carbon aspirations, is truly fit for the future and ensures that we maintain our indigenous steel sector here in Wales and the UK for the long term. Significant support is needed, particularly investment, but we are clear that the steel industry in Wales, with the right internal market conditions, can have a sustainable and successful future. 

I am aware that there are particular concerns over the separation with the Tata Steel plant in IJmuiden, which will mean that Tata Steel UK will lose access to the research and development capability in the Netherlands. Over recent years, we've seen significant investment in our research and development capability here in Wales related to the steel sector. Initiatives such as the Steel and Metals Institute, SUSTAIN, FLEXIS and ASTUTE mean that we can build on this expertise to further develop our domestic research and development capabilities.

The COVID pandemic has raised important questions around our economic resilience, and the time is now right to ensure that we maintain our steel-making capability for the long term. We have seen how important it is that we have strong, resilient, local manufacturing and supply chains. We need our steel sector to be at the base of our low-carbon future in energy efficient buildings, in renewable energy, in low-carbon electric vehicles and, of course, construction. Also let’s not forget that steel itself is endlessly recyclable. 

It is therefore vital that the UK Government commits to real and significant support for Tata Steel and the sector as a matter of urgency—support that will make a lasting difference to the sector and genuinely secure its future, not just paper over the cracks. And this is not a new ask; the sector has been calling on the UK Government for many years to take action in key areas, including energy prices, and to provide an effective package of support of the type that other sectors have received through specific sector deals.

So, I spoke with the Secretary of State for Wales on Friday, and yesterday I raised the matter with the UK Government's business Minister Nadhim Zahawi MP. I am also seeking a meeting with the Secretary of State for Business, Energy and Industrial Strategy. The First Minister has already written to the Prime Minister about the strategic importance of Tata Steel, and he is also seeking an early discussion with the Prime Minister to discuss finding a sustainable future for the company. Only the UK Government has the capacity to provide the scale of support now required. Proactive and rapid support would represent tangible action on the levelling-up agenda and demonstrate the UK working for Wales at this critical time.

In addition, it is important, I think, Dirprwy Llywydd, to emphasise that a 'no deal' Brexit would be extremely damaging for the UK steel sector, and it's therefore vital that the UK secures a comprehensive trade deal with the EU with tariff-free access to EU markets. That comprehensive trade agreement with the EU is the No. 1 trade agreement priority for UK steel makers. The EU is by far the largest export market for UK steel companies and their UK-based customers in the manufacturing sectors. It's vital that the steel industry in Wales is not disadvantaged through unnecessary trade barriers such as additional customs, tariffs, quotas or technical barriers to trade.

Dirprwy Lywydd, the UK Government's significant spend on areas such as infrastructure also means that there is huge potential in terms of opportunities for UK steel makers, which would help protect jobs in steel companies, their supply chains, retain GVA in our economy, and potentially reduce carbon emissions by shortening those supply chains. I will be seeking further discussions with UK Government Ministers and the company over the coming days and weeks to work together to secure the future of Tata Steel's plants in the UK and here in Wales, and I can assure Members that I'll keep them updated on those discussions.

Minister, can I thank you for your statement this afternoon? I'd agree that Tata Steel's decision to split the UK and Netherlands businesses will be deeply concerning for steelworkers across Wales and their families and the local community and wider supply chain. Uncertainty is often unwelcome, and I'm afraid we've had plenty of that during 2020, sadly. I am conscious, as well, that we do use the right language in terms of our conversations about Tata, because what I don't want to do—I'm sure what we can all agree on is that we don't want to undermine Tata's abilities themselves to come forward with solutions and their own abilities.

In your statement, you say you believe that the steel industry is of strategic importance and that it has a future in Wales and the UK, and I would agree, and I sincerely hope that you are right in this assertion. You say in your statement, Minister, that Tata Steel will lose access to the R&D capacity in the Netherlands, and I think this is a particularly important aspect for us here in Wales. I wonder if you can expand on what you've said this afternoon in terms of our abilities within Wales and the UK, but Wales specifically, in terms of strengthening our own R&D capacity. What weapons does the Welsh Government have in its own armoury to ensure that steel production can be self-sustaining here in Wales? I wonder if, Minister, you could outline what steps the Welsh Government is taking in order to utilise public procurement and investment to encourage modern methods of construction here in Wales.

Perhaps you could also update on discussions that the Welsh Government has had on creating the correct regulatory environment, which protects the production across Wales and the jobs in the wider supply chain. Furthermore, the Welsh Government's objective of decarbonisation and the condition of public subsidy of being carbon neutral by 2050 through the use of electric arc furnaces could have the effect, of course, of reducing the number of staff that are necessary on the site at Port Talbot, so how does the Welsh Government intend to meet the objectives of decarbonisation and protecting the livelihoods of the people who are directly employed as part of the wider supply chain at Port Talbot? Finally, it may also be helpful if you could update us on any work with regard to reforming business rates and reforming the business rates system that will help businesses across Wales in this particular sector.

Can I thank Russell George for his questions? I'd agree with his statement at the outset that, whilst, obviously, this will create anxiety—an announcement of this type always leads to uncertainty and, therefore, uncertainty—during the conversations that we've had with Tata, it is absolutely clear to us that Tata remain fully committed to the UK, and absolutely determined to take their assets through the necessary transformation to make them competitive and to guarantee the jobs that are contained within the Tata sites across the UK.

I guess a test of that commitment will come soon, in the way that Russell George outlined, in that we know that, as they disentangle two sides of the business and separate them out, R&D facilities will remain in the Netherlands, so too some of the functions that include sales, procurement and digital services. So, we would expect, as part of the separation of the company, those capabilities to be re-established here in the UK. I think that move to re-establish R&D, sales and procurement will be a clear demonstration by Tata that it is fully committed to the future of steel in the United Kingdom.

I think Russell George is also right to identify that, whilst the UK Government has the key role to play in providing the support necessary for steel, and particularly Tata in the context of today's discussions of a viable future, the Welsh Government also has a key role to play as well. We have stood behind Tata for many years, since 2016, offering crucial support in terms of skills training packages and R&D, and those offers of support remain in place. We've invested approximately £11 million, for example, in skills training provision, and we've also invested heavily in research and development facilities. I mentioned a number of them in my statement, and R&D is going to be critically important in terms of driving competitiveness and innovation beyond some of the steel sector-specific research and development facilities that we've invested in. We've also invested in manufacturing facilities that rely on steel as part of the supply chain—so, bringing businesses, particularly small businesses, together in those research facilities, enabling them to work together, to innovate, to use products that come from the Tata Steel family in the UK. I can point to one particular example: the Advanced Manufacturing Research Centre in Broughton, just a stone's throw from the Shotton facility.

In terms of procurement, Members will be aware that, insofar as procurement is concerned, the Welsh Government was the first signatory to the UK steel charter, which complements our earlier procurement advice note, by encouraging projects in Wales to source and benefit from high-quality British steel wherever is possible. As part of our actions to improve procurement practices, in addition to compliance with public contract regulations, we've implemented an additional mandatory legal position in our tender pre-qualification questionnaire that no dumped steel—no dumped steel at all—is to be used in any contract awarded by public sector bodies in Wales. But we're going to be looking, obviously, to the UK Government to see what more they can do to ensure that UK steel makers have every opportunity to be part of supply chains for publicly funded projects with a steel requirement. I received, just in the last 24 hours, the latest UK steel newsletter. I'd very much encourage Members to gain access to it; it's incredibly informative, and it identifies in there that demand for steel in the UK will rise from £3.8 billion today, this year, to £6 billion by the end of this decade. So there are huge, huge opportunities in terms of procurement here in the United Kingdom. And of course for Tata, there are particular opportunities in terms of automotive, because Tata supplies more than a third of the steel for the UK automotive sector's requirements.

Then, finally, with regard to business rates, I will of course ask the Finance Minister to provide an update on the work that's concerning the future of business rates. I know that this is extremely important to Tata and other steel operators in Wales. However, the key concern for steel businesses, particularly for Tata, relates to issues such as uncompetitive energy prices, where operations on the continent enjoy electricity prices up to 80 per cent lower than the United Kingdom. Then, secondly, the big challenge for steel in the UK is to ensure that it can transition in the context of our ambitions for net zero, and that requires considerable state intervention.

I'd like to begin by thanking the Minister for his statement and for the briefing that he provided to opposition parties on Friday. I'd associate myself with everything that he said about the huge importance of the steel industry to Wales. We tend, for obvious reasons—because of the number of jobs—to focus on Port Talbot, but as the Minister has said, there's a much broader significance. Extremely important in Llanelli, part of the region I represent, are the people employed at the Trostre plant.

Now, in the Minister's statement he focuses a lot on the role of the UK Government and reports back on the discussions that he's had, and obviously all of that is important. I do understand what he says about the need for the UK Government to step in and commit to real and significant support for Tata. But I need to ask him this afternoon: what is his plan if they don't? Experience suggests that we can't rely on this UK Government. If we just think of the recent experience of furlough, where that support was not made available when it was needed in Welsh communities, but it was there as soon as it was needed in Surrey, what reliance can we place on the UK Government for doing the right thing here? What if conditions, as has been reported—those conditions that the UK Government place on that support—lead to really significant redundancies? I have to ask him: is it his understanding that UK Government support, as again has been reported, is likely to be conditional upon the replacement of blast furnaces at Port Talbot with electric arc furnaces?

I agree with everything the Minister has said about decarbonisation, but I hope he would agree with me that this is not the way to do it. Taking on board what the Minister has said about the likely rise in demand for steel in Wales and across the UK, does he agree with me that we shouldn't rush to decarbonise our steel industry in such a way that means that we have to massively increase steel imports, effectively exporting our carbon footprint instead of dealing with it using new technologies and making our steel industry sustainable using, for example, emerging hydrogen technologies? Now, if this isn't a risk, what has been reported, surely it's in the company's best interests in terms of customer confidence for this to be firmly and finally denied, and if it is a risk, then surely we need to publicly debate it and the potential implications.

The Minister refers to Tata reviewing all options to make sure the business is self-sustaining without the need for any funding support from Tata in India in the future, and I'm sure we would all understand why that would be. I understand what the First Minister said to Adam Price about the Welsh Government being at the service of the UK Government and the company at this time. But does the Minister accept that it's dangerous to rely on this alone as a strategy? Shouldn't he and the Welsh Government be, at the same time, exploring other models that would enable the ownership and control of the company to be taken back into Welsh hands if that's what's needed? The Welsh Government was prepared to support a management buy-out, potentially, of Port Talbot a couple of years ago. Will the Minister this afternoon commit to considering other potential ownership models if the approach he's currently taking is not successful? Would he consider a co-operative model? Would he look at a not-for-profit company? And if the UK Government does end up taking a stake in the company, will he commit to finding a way that the Welsh Government can do so too, so that we have a seat at the table when future decisions about this vital industry are made?

Can I thank Helen Mary Jones for her questions? Of course, Helen Mary Jones is right to point to the fact that it's not just Port Talbot we're talking about, and thousands of workers at Port Talbot, but the other Tata Steel plants across Wales, which employ huge numbers of people who are very well paid. In fact, the steel sector in the United Kingdom pays an average salary of £36,000. And, bearing in mind that many steel sites in the UK are in areas that require levelling up, the loss of any of those jobs within those communities would be very damaging indeed, which is why, I think, the UK Government is acutely aware of its responsibilities in regard to supporting Tata. The indications that we've received from the UK Government, and from Tata, are that discussions are proceeding, and that they have been positive, and that an outcome may be with us soon. But, obviously, every day that is lost intensifies anxiety within the workforce, and therefore, those negotiations have to be taken forward at maximum pace. And it's hugely important, as I've mentioned, to the levelling up agenda, given that Tata Steel sites are in some of the most deprived communities in the United Kingdom, which require direct state intervention to enable them to appreciate a greater level of prosperity. 

Now, Helen Mary Jones raises a number of questions about both the technologies that are used and the ownership models that might be considered. I'm not going to be drawn on the potential use of hydrogen or electric arc furnaces today, because, right now, our focus is on making sure that Tata Steel draw down the necessary funding from the UK Government in an agreement, in a common purpose, to transition the sites into a position where they are globally competitive. And let me just assure Members that Tata Steel employs the most skilled, the best steel workforce in Europe, if not the world. Given the right tools and investment, Tata Steel operations in the UK can outcompete any other facility anywhere around the world. So, the UK Government can act as an enabler for this hugely important sector to become the world's finest.

Now, during my time in this position, I've worked with four different Secretaries of State for the Department for Business, Energy and Industrial Strategy, and each one has given assurance that they wish to see the steel sector brought into a position where it's highly competitive, and where it has a strong and sustainable future. This fourth Secretary of State that I've been working with, Alok Sharma, can be the person that delivers the goods. And that is absolutely vital in the interests of the employees, not just directly employed by Tata, but also the supply chain.

Now, talk of nationalising Tata, I don't think it answers the exam question that we face. The exam question is: how can Tata's operations transition in the context of our net-zero aspirations? How can Tata Steel's operations operate in a competitive way given the disproportionate costs of energy in terms of the business model? And whether or not you nationalise the operations, you are still going to be faced with those energy costs, which only the UK Government can do something about, and the need to decarbonise. And, so, actually, the ownership model is a debate, whilst very interesting to us—and I've just recently nationalised the railways—I can say that it is not relevant to the challenge that we face right now, that steel faces right now. The major challenge that we face right now is in ensuring that the transition is safe and can be secured in a way that guarantees the maximum number of jobs, and that means having a transition, utilising whatever technology might be preferred, a transition that takes not just a few years, but 10 years, to guarantee those jobs, to ensure that, as Helen Mary Jones rightly said, we don't rely on imports from other operators that are polluting the planet, but that we have a safe transition period put in place to guarantee jobs, and to make sure that we can, in a safe way, meet our net-zero ambitions. 

I'm grateful to the Minister for his statement this afternoon. Ebbw Vale, of course, is synonymous with steel, and many other communities within my constituency, and other people's constituencies, were built on steel, and people employed both in steelworks and in allied industry. Steel matters to all of us, and all of us in Blaenau Gwent have seen the impact of steel closures—the impact on people, on families, on the community as a whole. And we also know that steel remains central to our future. It remains central to the economy of Blaenau Gwent and other parts of this country, and it is essential that an activist Government works with the different owners and businesses to ensure the future of steel. And I'm glad that the Conservatives recognised that during this session this afternoon.

Deputy Presiding Officer, I was interested by the Minister's response to Helen Mary Jones, to Plaid Cymru, and what he said there about the role of energy and the role of sustainability, in terms of the business model that Tata currently has. I recognise what he says about the importance of ensuring that there is a business available to Tata over the coming years, and that we have a business model available to sustain steel, but I also think that there are ways in which the Welsh Government can take a more activist approach. The point the Minister makes about energy is absolutely critical and central to the future of this industry, but we also know that this Government can take an activist approach to ensure that we have energy supplies that are based on renewables, based on sustainability, and also delivered at a price that businesses and consumers can afford to pay.

So I hope the Minister, in responding to the statement this afternoon, and responding to what is happening in Tata at the moment, will take that longer view of the industry and our foundational economic industries, because they all share some of the same and similar challenges and an activist Government can invest in that—not only that industry, but in that economy, to create an economy that is sustainable in market terms, sustainable in financial terms, and sustainable in environmental terms as well.

Can I thank Alun Davies for his questions? And he's absolutely right that Ebbw Vale, like many other communities in Wales, was built on steel. We're often very sentimental about the past, about the role that steel has played in shaping our communities, our culture, our heritage in Wales. But I think we should be equally enthusiastic about the future of the sector in Wales. Because as I've said, with the tools, with the investment, with some of the challenges that the sector has faced for many years in terms of energy costs, with those addressed, the sector has a very strong future indeed. And I know all too well—just as the Member Alun Davies has outlined—the pain that can be caused when jobs are lost from steel facilities. I was a youngster when more than 8,000 jobs were lost in a single day at Shotton steel, but I very much, very much recall the pain, the suffering that it caused immediately, and also the ongoing scars that it dealt to the wider community.

Alun Davies is absolutely right that energy is a crucial consideration in how we support Tata and the wider steel sector. I continually raise the need for action on high electric prices faced by UK steel makers and energy-intensive industries. According to UK Steel—and, again, I'd point to the latest news data, which is incredibly informative—our UK steel makers pay 80 per cent more than their French counterparts; they pay 62 per cent more than our German counterparts. So, it demonstrates just how uncompetitive, due to the energy prices, some parts of our processes are in the UK. And of course, other energy-intensive sectors and businesses also face those disparities.

Now, the UK Government—and I welcome this—has stepped forward with an industrial energy transformation fund; I do welcome that. However, the fund is only worth just over £300 million, and the support that is required for Tata is support that goes beyond the energy price issue, that goes beyond sector-wide transformation. It needs specific business support from the UK Government. And in our many meetings with Tata, we are always open to requests for support, in order to help the transition, the transformation of their businesses. But we are always reminded that the key player is the UK Government, with the ability, the capabilities to be able to invest in a way that provides that safe transition.

And renewables—. Alun Davies is absolutely right: the Welsh Government's role in promoting renewable energy is going to be hugely important, not just to steel but for other intense-energy operators in Wales. And there's massive potential in terms of onshore and offshore renewable energy. For my part, I'm particularly excited about the development of floating offshore wind, which could be worth billions of pounds to the Welsh economy and, if we promote it in the right way, if we attract the right investors in—and we are working incredibly closely with the sector—we could not just deploy floating offshore wind, but we could also manufacture those turbines. We could also ensure that the research and development capabilities are secured in Wales as well, linked to the wider manufacturing families, including, of course, the steel sector. 

Thank you for your statement, Minister. Steel workers and their families in my region are deeply concerned with the decision by Tata to split the UK and Netherlands businesses. Do you agree that it is important that we make it a priority to ensure Tata's operations in the UK are self-financing? We must ensure that Port Talbot has a future role in providing the UK's steel needs. Minister, what steps are you taking to ensure that steel produced in Port Talbot is used in major infrastructure investments by the Welsh and UK Governments? What role does the Tata plant have in providing the steel for the south Wales metro and road improvement schemes, such as the Heads of the Valleys dualling? And, finally, Minister, what actions has the Welsh Government taken to assist Tata with decarbonisation and reducing their energy costs, both of which are vital to ensuring the sustainability of all its UK operations? Diolch.

Can I thank Caroline Jones for her questions? I'd agree entirely that the announcement will cause deep concern for workers, but we have to assure those workers that we are all—we are all—determined to safeguard their jobs, to provide the support that's required in order to see Tata's UK facilities become more competitive in the global market, provide more steel for the UK and for other nations. And for the reasons that I've already outlined, I'm confident that Tata are truly committed to the UK.

But, as I've said, also, an early indication will come of their commitment in the form of some of the consultation that will take place now during the company's separation process, including how Tata responds to the needs within the UK for research and development, sales, procurement, digital functions to be re-established. Once we see the re-establishment of those particular capabilities, then we can have even more confidence that Tata is on the right path to securing UK operations and to make them self-financing. Making them self-financing is a considerable ambition, but I think it's one that's necessary to secure all of the UK's plants for the long term. But it will require, as I've said on repeated occasions, direct intervention by the UK Government, and those discussions are ongoing, but I would urge UK Government Ministers to bring those negotiations to a swift and positive conclusion as soon as possible.

Steel workers in Wales and across the UK employed by Tata have suffered anxiety for far too many years now, and it's time that they're given the assurance that, even with those other challenges we face in terms of decarbonisation and Brexit, they will have a future in that sector. Transport for Wales has engaged directly with businesses across Wales, including with Tata Steel, in terms of opportunities for businesses through the metro transformation programme. Other businesses in the steel sector in Wales, the likes of Liberty Steel, for example, they produce a significant amount of steel for Network Rail's operations. So, there are obvious opportunities there with the metro for steel businesses in Wales.

And I've already answered the questions regarding energy, the energy prices, the need for steel businesses in Wales to become competitive. There is the industrial energy transformation fund that I've already pointed to, but we have been ready to work with steel businesses, through some of the research and development and innovation centres that we've been funding, to ensure that they can reduce their carbon emissions, to ensure that they can undergo the transformation that's required to make them competitive globally.

Thank you. We've had one speaker from each of the four groupings here today. So, can I now ask for brevity, and that includes brevity in the answers as well, Minister, perhaps? We've got a number of questions.

Apologies. 

It's all right, but we've got a number of questions which we intend to get through. So, Mark Isherwood.

Diolch, Llywydd. The Secretary of State for Wales, Simon Hart, and the UK Minister for Business and Industry, Nadhim Zahawi, met Tata Steel early last Friday, ahead of the company's announcement on its commercial operations in mainland Europe. It was agreed that both UK Government and Tata Steel would continue to work together to protect the future of high-quality and sustainable steel making in the UK. I therefore welcome your engagement with them.

Tata Steel Colours in Shotton remains a key part of the north-east Wales economy. They told me five years ago that they were critically dependent upon the supply chain for sustainable British steel and that they were reliant on feedstock from the heavy end in south Wales, as they described it. What consideration will you therefore give to this during your engagement with both the UK Government and Tata Steel? There are still 700 employees at Tata Steel in Shotton, with its hot-dip galvanising, organic coating, panel line for building systems and its apprenticeship programme. What consideration will you therefore give to these key issues during your engagement with both UK Government and Tata Steel? Tata Steel in Shotton is also in the running to host a Heathrow logistics hub. What consideration will you therefore give to this during your engagement with both UK Government and Tata Steel?

And finally, reference was made to the Dŵr Cymru model. As you're aware, I previously worked in the mutual sector for over two decades, for the building society that actually merged with the Shotton steel building society—the John Summers Building Society—and I know that, unless mutuals make a surplus, they go out of business, just like a for-profit business. Do you therefore agree with me that the priority must be keeping them in business, with whichever model can best deliver this, rather than putting the models first?

Can I thank Mark Isherwood for his questions and his contribution, and agree with him that discussion over ownership models is actually a distraction right now from what has to be done? And I think we have to focus right now on supporting Tata to undergo the transformation that I've outlined that is necessary to make them more competitive and to secure the long-term future of the facilities in Wales and across the UK. 

I've spoken on numerous occasions now with the Secretary of State for Wales, Simon Hart, since the announcement, and I've also spoken, as I said, with Nadhim Zahawi, and I'm seeking further discussion with the Secretary of State for Business, Energy and Industrial Strategy, Alok Sharma. I'm keen to make sure that the Welsh Government is able to support the UK Government in providing the finances to Tata Steel UK's businesses, primarily Tata Steel here in Wales, by adding value—by adding value. And the role that we can play in the Welsh Government in adding value is to support the workers to undergo skills training and to ensure that the right research and development capabilities are developed. That's our key role, and that's why I think it's really important that those ongoing discussions involve Welsh Government wherever possible. 

Mark Isherwood asked a number of questions specific to the Tata Shotton site, the Shotton Colours site, which employs 760 highly skilled people. That site has enormous potential—huge potential. It's my understanding that demand for products from that site had returned, prior to the announcement, to pre-COVID levels, demonstrating just how competitive that site is, just how high the quality of those products is. And I remain very excited indeed about the potential for the Tata site in becoming a logistics hub—not just a logistics hub for Heathrow, but for other businesses across multiple sectors. And my officials are working incredibly closely with Tata Steel to understand some of the barriers that need to be overcome in forming that logistics hub at the Shotton site and, in particular, how we can open up a third access to the site. That would be vitally important in securing the site as a logistics hub serving not only Heathrow but potentially many other sectors and, as I've already mentioned, floating offshore wind. I think there could be an opportunity there for renewable energy manufacturing or logistics as well.  

Minister, can I thank you for your statement this afternoon? I find it very encouraging, the position that you've taken. Can I also thank you for all the support that the Welsh Government has given to the steel industry over the years? Steelworkers in my constituency are very grateful for that support and, as you quite rightly pointed out earlier in your contribution, they are the best in the world and they have given much to the industry, and now they want the industry to continue honouring their commitment to them and to their families.

In relation to your points made, I think that it's important that the UK Government now takes this opportunity—and I see it as an opportunity—to actually get a steel industry for the United Kingdom, which will provide a foundation for other manufacturing across the country. And this is a chance, I think, for them to step up to the plate and become an active player in the industrial strategy of the UK. I hope they take it.

Now, in your statement, you indicated that the funding support from Tata Steel India in the future is not going to be needed. That's their focus—they want to make it sustainable. But have you had any indication as to to when they will continue supporting it and at what point they expect to be self-sustaining, so that we have at least a target we can look towards in ensuring that industry becomes self-sustaining?

Also, on the decarbonisation agenda, everyone talks about hydrogen. That is some years down the line, as the technology is not quite there yet. But one thing that is available is carbon capture and storage. Are you looking at further research and development in that area to ensure that there's a possibility of decarbonising the industry in Port Talbot in particular, because, clearly, that's where the heavy end is, and that's where the large carbon emissions would be? Have you had good discussions with your colleague in the Cabinet, Lesley Griffiths, regarding the emissions trading scheme that is being put into place to replace the European emissions trading scheme to ensure this is not going to be detrimental to the steel industry in the future and that the UK model will be very supportive and useable for the UK steel sector?

We talked about skills and the separation of the businesses into a Dutch component and a UK component. And we do know that the elements are currently based in Holland, because they did go from Port Talbot over to Holland—the R&D and the sales. What discussions will you be having for the skills agenda to ensure that those come back? And how are you working with the research and development, particularly Swansea—because I know that Tata work with Swansea and Warwick, but particularly Swansea and the Steel and Metal Institute—to ensure that that's the centre for R&D for steel in the UK and it becomes critical for Tata to work with them?

Can you bring your—[Interruption.]—to a conclusion?

I will conclude, but, as I'm sure you're aware, Deputy Presiding Officer, this is critical to my constituency and my workforce there.

Absolutely.

My final point, though, is—there's a lot of talk about levelling up by the UK Government. You mentioned in your press release on Friday that the First Minister was seeking a phone call with the Prime Minister. Has he returned that phone call, and has he agreed to make sure the levelling up applies to Wales and the steel sector as well as anywhere else?

Can I thank Dai Rees for his questions and say that he is a powerful and passionate advocate for Port Talbot and for the steel sector as a whole in Wales? I very much welcome his contribution today, and I would agree with him that this does present the UK Government with an enormous opportunity to demonstrate a commitment, a true commitment, to levelling up, but also to secure what I think is a nationally strategic interest for the United Kingdom. I think steel is important to our national security. I don't think it's possible to imagine a scenario where, as we reach the end of the transition period, we could possibly tolerate the idea that steel making could be lost from the United Kingdom. That is simply unimaginable. And the UK Government can therefore take this opportunity to guarantee that we will have a viable, secure future for the sector across the United Kingdom, and there are many, many opportunities I've already outlined, in terms of procurement as well, with demand purely within the UK estimated to almost double over the course of this decade—huge opportunities if procurement is sorted to make sure that we capture as much of the public spend as possible for UK steel operations.

I'm working with Tata and also, I have to say, with Community. I had a very, very good discussion, a constrictive discussion, with Roy Rickhuss today at Community. I can say that we are perfectly aligned with the Community union. There is not a cigarette paper between us in terms of our belief in the sector, our commitment to Tata, our desire to make sure that steel in the UK has a strong and viable future, and we're going to be working together with Tata in understanding exactly what the move towards becoming self-sustaining means, and how that can be reached and when it will be reached.

Carbon capture could have an important role in terms of meeting our obligations on carbon emissions, and, in terms of the emissions trading scheme, Deputy Llywydd, I'm afraid I could talk for quite some time about the ETS, but I'll just say that—

No, I don't think so.

—the Welsh Government, working with the UK Government and, obviously, other devolved administrations, has developed that UK emissions trading scheme; it's going to operate as a stand-alone scheme, or it's going to link to the EU ETS, and the legislation is now in place for that scheme to become operational on 1 January 2021. That's vitally important.

Then finally, in terms of further support that could be brought forward in terms of research and development, there is, obviously, the Swansea bay city deal, and Swansea University has proposals to further develop steel expertise in Wales through the city deal. And in terms of the phone call, I am not aware that that phone call has taken place yet, but I will inform Members as and when it happens.

Minister, I was very pleased to hear you open with comments on the skills base of the steel industry in Wales. I think people overlook the fact that it's a constantly modernising industry and that's why it's such an important player in those institutions such as the Swansea bay city deal that you mentioned and Swansea University. But I'm quite keen to make sure that we don't overlook the opportunities for apprenticeships in this as well. Tata's a huge contributor in that particular field, and I'd be grateful to know what reassurances you've had about the opportunities for apprenticeships during this nervous time. Thank you.

Can I thank Suzy Davies for her question? And she's absolutely right: people employed by Tata are amongst the most skilled in Europe in terms of the steel sector, and, as a Welsh Government, we've been pleased to be able to invest £11.7 million in terms of skills training funding since 2016. Apprenticeships have played a key role across all of the Tata sites, and our understanding is that Tata remain fully committed to providing apprenticeship opportunities even in these uncertain times, and, of course, the Welsh Government has recently announced an incentive for businesses to take on apprentices, including, importantly, young apprentices. So, for every young apprentice aged under 25 that a business takes on, they'll receive an incentive of £3,000, and this could prove hugely important to larger employers like Tata in retaining or taking on apprentices during the course of the pandemic and then the recovery. But I'll happily write to Members with further details of Tata's plans for their apprenticeship provision.

Can I thank the Minister for his statement? And can I also pay tribute to the workforce at Shotton steelworks, including my fellow Community and Unite union members? Their hard work and skill really does produce the best steel, making the Shotton site actually profitable.

Minister, you've already commented on the offsite logistics hub, which I've been a long-standing supporter of, and you've just commented on the apprenticeship programme at Tata; I look forward to receiving more information on that. Perhaps today you could comment on the wider training of staff, which is something that Welsh Government provides funding for, and also the opportunity to use the world's best steel and most sustainable steel as part of a green manufacturing recovery from COVID, especially as the Shotton site is looking to transition towards being carbon neutral.

Now, I must say, Deputy Llywydd, finally, this support from this Welsh Labour Government and the support they've offered in the past is in stark contrast to the UK Conservative Government, who have been far too often missing, and I must say—. I hear tutting, but I must say my community—my community—is still devastated from what happened during the Thatcher Government, and it is long, long from forgotten. So, Minister, could you update the Chamber on how confident you are that UK Ministers get the need to provide urgent support for Welsh sustainable steel, and have a strategy in place to do so?

Can I thank Jack Sargeant for his questions, and can I just recognise, put on record, my thanks to Jack Sargeant for the enormous amount of work that he's done in supporting the Shotton Tata facility in developing the plans for a logistics hub? And my officials have been working with Tata Shotton in developing that master plan, but I know how much work Jack has contributed to this particular agenda, and I thank him for it. I'm also grateful for the acknowledgement of the support that Welsh Government has given to Tata over many years, and I would say that, looking to the future, let's describe this as an opportunity for the UK Government to demonstrate—very soon, actually—that it is fully committed to levelling up the UK, by providing that vital support that Tata require in order to undergo the transformation that it wishes to proceed with, and to ensure that it becomes more competitive.

In terms of what could be produced at the Shotton site, well, we know that its products are amongst the highest quality in the market, and that they're already contributing to energy efficiency schemes, particularly in the construction centre. But, obviously, given the recyclability of steel, it will become an even more prominent feature of our aspiration to reuse and to renew as we seek a green recovery. So, I am in no doubt that the 760 employees at the Shotton site can feel proud and can feel optimistic that they will be contributing, as an industry of tomorrow, to a greener economy.

The Minister talks about steel being endlessly recyclable and the need to support your low-carbon aspirations, but doesn't that imply the use of arc furnaces, rather than the current production method with blast furnaces at Port Talbot? Isn't there an inevitable tension between decarbonising the electricity supply, including ways of preventing use of cheaper ways of producing electricity, albeit there have been some improvements? And there's a question as to whether the consumer or the taxpayer pays that higher price and what that proportion is, but isn't there that tension? And does Welsh Government support UK Government with its reported proposals to pay £500 million, or thereabouts, towards converting production to arc furnaces? Is that something that he supports, or does he prefer to stay with the blast furnaces, notwithstanding any carbon implications of that? And isn't it about time we recognised that the reason we're in this problem is, last summer, the European Commission vetoed the merger of Thyssenkrupp's European interests with Tata Steel, which would have allowed Dutch and Port Talbot plants to work together, and instead they're having to be separated in response to that European Commission decision?

Well, on that final point—and can I thank Mark Reckless for his questions—on that final point, the merger would not have addressed the challenge that UK steel operations currently face. They would have remained, and those challenges can only be answered through collaboration with UK Government.

In terms of the tension that exists, I would acknowledge fully that that tension is there, it is problematic, but the fact of the matter is that currently, at present, blast furnace generated steel is about the only steel that can be used in certain sectors, for example, in the automotive sector. And that is why Tata Steel in the UK provides steel to about a third of the demand of the automotive sector. Now, over time, new technology could be developed, refined and finessed to provide that grade of steel but, at the moment, it is simply not there. Now, I'm not going to be drawn on the type of technology that could be used in the future, whether it be based on hydrogen or electric arc furnace, a combination, whether there's a hybrid model that could be adopted. All I would say is that whatever transition takes place should happen over a period of time that secures the workforce, and secures all of the Tata Steel operations in Wales. And we will support, not just Tata, but the UK Government and the unions, in working together to that end goal.

Minister, amongst the strong areas in Wales in terms of steel tradition is Newport, of course, with Llanwern—excuse me—and Liberty Steel. We did have Orb, but, sadly, that's now gone, and there's a host of smaller players. So, I would like some reassurance today that that steel tradition and those steel sites will have a strong part in the future of steel in Wales and the UK. There are a lot of skills and experience in the area, currently employed and recently made redundant, that could be utilised. And, of course, Liberty Steel, for example, has some very clear ideas on green steel and how that might be taken forward, as well as some ideas on the energy aspects.

You have already referred, Minister, to—if we are going to have a distinct Tata Steel operation in the UK—the need for some of the existing functions, such as research and development, procurement, sales and, indeed, some of the digital aspects, to be part of that distinct UK operation. Some of that has been concentrated in the Netherlands. Llanwern has hosted some of those functions. I'm just wondering if you could say a little bit about the role that Llanwern might play in hosting those functions again, and about some of the implications for training in the area, and the role that organisations like Coleg Gwent and the University of South Wales might play.

Can I thank John Griffiths for his questions and also recognise the incredible interest that he has shown in steel-making facilities in the Newport area and the wider region over many, many years? He is a great supporter of the sector.

Llanwern employs currently around 960 highly skilled individuals, providing steel for the automotive sector and, therefore, relying clearly on Port Talbot. Tata were at pains—they were at pains—to express their determination to secure UK operations when I spoke with them on Friday. We now look to see those functions that John Griffiths and others have identified to be re-established, or to be returned, back to Wales. We may well see a return of those jobs here from the Netherlands. If not, then I would expect new capabilities to be established here in Wales.

I don't think that it would be for me to speculate over exactly which functions might be based in which of the steel facilities. But, I would imagine that, given the prominent role that the Llanwern site plays in terms of the automotive sector, there may be an opportunity there to develop some of the sales functions. Obviously, we will be working with Tata to look at how we can support the re-establishment of those facilities and capabilities here in Wales. We want to capture as many job opportunities as possible. But, as I have said, we will look very, very soon at those functions, once Tata begin the process of re-establishing them or returning them here to Wales, and we will support them in any way that we can.

Thank you very much, Minister.