Jonathan Reynolds MP: speeches

Speeches

• 14 Sept 2026 · Speciality Steel UK · Hansard source

  More

  The quality of the downstream products we create in the UK, particularly in Wales, is well known, but there are gaps in the market. I often compare the level of domestic consumption in most European countries to where we are with domestic production in the UK, and there are clearly gaps in that market. That has always been about the need to improve the business environment, so that the sector can work constructively with the Government to provide the public-private capex solutions that we have seen a lot of across Europe but have not seen many of in the UK. I am grateful to my hon. Friend and to all colleagues who make the case for what is, I believe, a business and a sector fundamentally important to the UK.

• 14 Sept 2026 · Speciality Steel UK · Hansard source

  More

  I am always grateful for the support of the Father of the House, who has a long-standing interest in all industrial matters. However, I consider myself more obsessed with industrial energy prices than, frankly, any other Member of this House. I am great company when this subject comes up. On electric arc furnaces—which are the technology in use here and will be, I hope, in Scunthorpe at some point —we already have in place a set of policies that do not just put us on a par with some of our rivals, but actually give us a competitive position. That is the supercharger scheme for the most energy-intensive electricity users. The Father of the House will know that we have also launched, as part of the industrial strategy, the British industrial competitiveness scheme which is about to come into force. In effect, it is a scheme for manufacturers, and again it significantly moves the dial on their competitiveness. I recognise this issue, but we have done more than previous Governments, and we will continue to do more on it. I agree entirely with the Father of the House’s case, but I think we must recognise the very substantial work that has already gone on. I considered BICS to be the centrepiece of the industrial strategy when we launched it, because it moves the dial so significantly on our competitiveness not just for steel, but across a range of manufacturing sectors.

• 14 Sept 2026 · Speciality Steel UK · Hansard source

  More

  I thank the shadow Minister for his response. I particularly appreciate his words for the Prime Minister, which I know he will appreciate, as will his family. The shadow Minister began with a long list of neglect regarding the policy, operations and ownership of this particular set of steel businesses. The obvious question is why the Conservatives did not do anything about it when they were in power—it certainly was not for want of requests to act from Labour Members. He has asked for reassurances about the workforce, and I am happy to give those to him. The cost of funding the official receiver, both to date and ongoing, is essentially the wages of the staff. They are in a position where they will be paid, which is paramount. The shadow Minister talked about the business environment. I say politely to all Conservative colleagues that they left us with the highest industrial energy prices in the developed world. That was the legacy—it is not due to any policy changes made by Labour. What do our industrial subsidies mean? For a sector such as steel, where an electric arc furnace is obviously incredibly energy intensive, the supercharger package—not the BICS package, because the supercharger package applies in this case—will bring down average electricity prices from approximately £168 per megawatt-hour to £86 per megawatt-hour. It is not just about being competitive with peers; that is a genuinely competitive position with our rivals. We introduced those subsidies because we were aware that the business environment we inherited from the Conservative party was not satisfactory. We had to act, which is why we have done so. Turning to wider measures, yes, we have activated a substantial trade defence policy. That is not just about maintaining domestic production; it is about being a country where the rules of the game apply. If we want people to be based here in the UK, they have to be able to take advantage of effective trade remedies when they are facing unfair competition. I know that that is an issue for the downstream users, but it is the position that I think the country has to take. What the shadow Minister has said about carbon border adjustment mechanisms is, I think, a new policy since I was last Secretary of State—the Conservatives are perhaps disowning the policies they had at the end of the last Government, because they were certainly committed to CBAMs then. Of course, CBAMs are fundamentally about trying to maintain fair competition between carbon-intensive sectors in developed countries such as ours and the rest of the world, so there is a little bit of incoherence there, to say the least. On the issue of working capital, the opportunity presented to us by Speciality Steel UK is that previously, the business only produced when the customer effectively supplied working capital—a highly irregular position, but one reflective of the opaque and byzantine financing arrangements under the previous owners. I believe the opportunity exists to operate a successful business in this space. There is nothing ideological about this; my ideal is for the business to be run in the private sector. The shadow Minister has asked why we could not take forward the preferred bidder. I will not go into the details, but when I come to this Dispatch Box I have to be satisfied that any public support given meets the reasonable conditions we would expect, such as that taxpayer money will be protected and will not be spent without delivering the outcome for which it has been granted. If I cannot do that, I cannot grant that subsidy, which I think is the position any Secretary of State would have to take. What is the barrier to a private sector solution? Effectively, it is risk—the fact that this was left so long without activity from the Conservative Government and the workforce have not been making steel. The customers are therefore in a position where that is a big, substantial challenge for any private sector entity to take on. If we do end up with a public ownership position, I think the state will be better able to take on that challenge, but it is the legacy of neglect that has been the barrier. That is exactly what this Government are determined to resolve.

• 14 Sept 2026 · Speciality Steel UK · Hansard source

  More

  The right hon. Member will understand that I will not comment on matters pertaining to the Secretary of State for Energy Security and Net Zero, but stick to the considerable number of issues in the domain of BIST. He specifically asked about cost. The cost for the official receiver is £11 million a month, which is in the main to meet the payroll cost of the more than 1,200 members of staff that the sites employ. That is what we have done to date, and it is what we will continue to do. On returning it to the private sector, we first have to see whether there is an opportunity to save this business. That may require public acquisition, as I said in my statement. If we follow the path in that direction, we would have to inject working capital—the process can now ascertain what that sum of money would be—to make the products and the business plan attractive and enable a return to the private sector, but that is a long way down the road. If we put in public money, I would want a return for that public money. I am more than willing—keen, in fact—to see this business return to the private sector, but if we put in public money to turn it around, I would obviously want to protect that money. I think is an entirely pragmatic and reasonable consideration.