Steel makers in the UK can’t compete with their international rivals because of local regulations that cost them some £431m a year, the Labour MP for Redcar claims.
According to Labour MP Anna Turley, restrictions including business rates and air pollution targets, as well as the strong pound and high costs of energy, are smothering the country’s steel-making sector, which employs some 30,000 people.
"Research I've undertaken in partnership with UK Steel has shown the steel industry in the UK is disadvantaged to the tune of £431m a year compared with our global competitors as a result of the exchange rate, energy policy costs, air pollution targets and business rates,” Turley said.
"I'm sure (Business Minister Anna Soubry) would agree that we want the UK to be the place to do business, not to penalise our own manufacturers."
Urging the government to step in, she said the steel industry has reached the ‘breaking point’ as it is unable to compete not only with cheap steel from China but also with that from France and Germany.
“This is a crisis for one of the most important foundation industries in the British economy,” Turley said.
"The UK steel industry supports the automotive, construction and aerospace sectors, as well as a raft of supply chains, and it's vital that we have a future for steel making at the heart of industry in this country."
Turley’s comments come after the SSI-owned steel plant in her constituency announced it failed to repay its debts and is facing the decision whether to mothball the plant. If no better solution is found, 2,000 people in Redcar will lose their jobs.
Turley called for a ‘top-level summit’ to discuss solutions and proposed a series of measures, including the cutting of business rates to ensure they are in line with competitors in France and Germany.
She further recommended the compensation package for energy-intensive industries to be introduced earlier than the originally scheduled April 2016. This way, UK steel makers would face the same conditions as their European counterparts
Turley also urged the government to provide financial assistance to Thai-headquartered SSI to help the firm repay its debt and ensure wages can be paid.
The steel industry crisis, caused by cheap imports from China and decreasing demand, which saw the price drop from £318 per tonne to £191 per tonne, has affected multiple UK steel makers. Earlier this year Tata Steel announced a series of job cuts in several of its plants.