3. Statement by the Minister for Economy, Transport and North Wales: Tata Steel

Part of the debate – in the Senedd at 3:36 pm on 17 November 2020.

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Photo of Ken Skates Ken Skates Labour 3:36, 17 November 2020

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.