Oral Answers to Questions
Jonathan Reynolds Excerpts(2 weeks, 2 days ago)
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Andrew Ranger (Wrexham) (Lab)
The Secretary of State for Business and Trade (Jonathan Reynolds)
I am delighted by the hugely positive response that the industrial strategy has received. It is a plan to lift every part of the country, making it easier and quicker to do business and to invest. For north Wales, with its formidable prowess in advanced manufacturing, it is a very significant set of proposals. The same is true for Wales as a whole, as I demonstrated on Monday at Port Talbot at the groundbreaking of the new electric arc furnace, which will get the enhanced supercharger discounted energy price.
Andrew Ranger
I totally agree with my right hon. Friend; this Government’s industrial strategy backs businesses in Wales not just with words, but with action and billions of pounds of investment over the next decade. In Wrexham, we are fortunate to have fantastic businesses, such as Kellogg’s and Hydro Aluminium among others, which have exciting ambitions for high-tech expansion. One barrier that needs to be overcome is sufficient power supply to the industrial and trading estates where they are based. Will the Secretary of State please update me on how the strategic sites accelerator will support them in doing so and the proposed timeline for its implementation?
Jonathan Reynolds
I thank my hon. Friend warmly for his question. I am excited about this. The strategic sites accelerator will prepare and accelerate sites for development by using Government tools, such as land acquisition, planning certainty and infrastructure support, to overcome existing barriers to investment on sites. It is designed to create jobs, to attract investment and to support our industrial and net zero priorities. It will work alongside other initiatives such as the connections accelerator service, which will streamline grid connections for major investment projects. It is about going faster, being bigger and being more ambitious for new investments, such as those that could come to my hon. Friend’s area. I can tell him that the Office for Investment is working jointly with the Ministry of Housing, Communities and Local Government and Ofgem to take this vital work forward. I expect capital to be deployed initially under this programme in 2026-27.
Charlie Maynard (Witney) (LD)
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
The Secretary of State for Business and Trade (Jonathan Reynolds)
My hon. Friend’s area is one of the most exciting investment locations in the world—in clean energy opportunities, carbon capture and storage, and offshore wind, but also in creative and digital investment, chemicals production and steel. Specific interventions for the Tees Valley include recommitting £160 million for its investment zone, enhanced support for the Teesside freeport for clean energy industries, and a lot of money for transport for city regions funding. Of particular interest to businesses in his area will be the new British industrial competitiveness scheme, which will reduce electricity costs by £35 to £40 per megawatt-hour for many businesses in Teesside.
Luke Myer
I am pleased that the Government have been listening to us and backing Teesside businesses with serious investment—I have been pushing for investment in clean power and advanced manufacturing. Last year, the 2024 UK tech jobs report named Middlesbrough as the UK’s fastest-growing tech destination. Will Ministers work with me to bring in investment in frontier technologies such as artificial intelligence to our region as well?
Jonathan Reynolds
My hon. Friend and his colleagues are incredible champions for bringing investment into the area, and I recognise and thank him for that support. He is right to say that some of the perhaps more traditional industries, though very exciting for the future, are not just the only story in his area. He has mentioned tech and the creative industries too, and I would say they are huge opportunities. Specifically, our investment in skills to make sure that there is a pipeline of talent in every part of the country is a formidable and significant contribution to delivering on those opportunities. I look forward to continuing to work with him on these issues.
Emma Foody (Cramlington and Killingworth) (Lab/Co-op)
Perran Moon (Camborne and Redruth) (Lab)
The Secretary of State for Business and Trade (Jonathan Reynolds)
As we have heard, the industrial strategy is a plan to lift every part of the country, and it specifically recognises clean energy opportunities for offshore wind and nuclear in the great south-west. The strategy also highlights foundational industries relevant to its eight sectors’ supply chains, including spotlighting critical minerals clusters in Cornwall. It included the launch of a new UK Export Finance loan guarantee scheme for domestic suppliers selling critical minerals to UK exporters. The upcoming 2025 critical minerals strategy will aim to secure a steady supply of minerals, optimising domestic resources and enhancing international collaboration.
Perran Moon
As the Secretary of State mentions, with its vast renewable energy and critical mineral resources, Cornwall is uniquely positioned to become a key driver of UK economic growth. Although the industrial strategy emphasises the role of mayoral strategic authorities and city regions, particularly in the north and midlands, does the Secretary of State agree that Cornwall’s immense industrial potential must not be overlooked, and can he reassure me that unleashing the Cornish Celtic tiger with the economic investment that we need is not contingent on joining a mayoral combined authority?
Jonathan Reynolds
I can give my hon. Friend that assurance. I was dismayed this morning to wake up and hear the Reform party actively arguing for less investment in Britain and telling businesses they should not invest in the UK. I find that absolutely absurd. There are a whole range of tools for local areas to shape their economies in the industrial strategy. Some relate to mayors, but many do not. It has the mix of tools that is required to unleash the potential of every part of the country, including his own.
Andrew George (St Ives) (LD)
Further to that very encouraging response from the Secretary of State, does he acknowledge that Cornwall is the poorest region in the United Kingdom? It has great opportunities, as the hon. Member for Camborne and Redruth (Perran Moon) pointed out, but it has been hampered since losing the highest level of EU structural aid. If we are going to take the opportunities and overcome the challenges that Cornwall faces, would the Secretary of State be prepared to meet the hon. Member for Camborne and Redruth, me and other Cornish Members to establish a bespoke strategy for Cornwall to drive the private and public investment needed?
Jonathan Reynolds
First, let me say that, as someone who used to spend their family holidays in Cornwall, I must protest: I have had two questions from Cornish colleagues and not a single invite to visit Cornwall over the summer holidays. I really think that is unacceptable.
The economic history of Cornwall is particularly interesting—I have had this discussion with my hon. Friend the Member for Camborne and Redruth (Perran Moon)—and I recognise some of the specific issues that the hon. Member for St Ives (Andrew George) has identified there. Of course, I am always willing to meet him, either in Cornwall or here in Parliament, to have that discussion. I believe there are key parts of the industrial strategy that will deliver the opportunities and the tools required to unleash what both colleagues are trying to achieve.
Lee Barron (Corby and East Northamptonshire) (Lab)
Martin Vickers (Brigg and Immingham) (Con)
The Secretary of State for Business and Trade (Jonathan Reynolds)
This has been a year of real achievement for the Department for Business and Trade. From holding our record-breaking international investment summit, which saw £63 billion committed to the UK, to intervening decisively to save British Steel’s Scunthorpe site and all the shipyards at Harland and Wolff, we have safeguarded thousands of jobs. We have reformed the Competition and Markets Authority, changed the zero emission vehicle mandate, altered the remit of the Low Pay Commission and introduced the Employment Rights Bill.
We have quadrupled compensation payments to victims of the Horizon scandal. We have agreed trade deals with India, the EU and the US and published a comprehensive trade strategy to help us to secure greater access to global markets for British business. We have brought forward our industrial strategy, and last week a survey by Deloitte found that Britain has become the most attractive place to invest in the world. We are delivering this Government’s plan for change, putting money into people’s pockets, driving growth and kickstarting a decade of national renewal.
Martin Vickers
The Secretary of State has tried to paint a glowing picture of what is happening, but I can tell him that in northern Lincolnshire there are growing concerns. There have been a number of business failures in the last few weeks in the Grimsby and Immingham areas, and he will be aware of the threat to hundreds of jobs at the Prax oil refinery. All that makes it even more important that the Scunthorpe steelworks has a long-term future. Can he update the House on the state of things at Scunthorpe?
Jonathan Reynolds
I am always keen to update the hon. Member and colleagues on the situation with British Steel. We have cancelled the redundancy consultation and removed the immediate risk to 2,700 jobs. We have taken on new apprentices and invested significantly in improving health and safety on the site. We have provided significant working capital—that does not take into account yet the future revenue that will come. I am sure he will have been pleased to see that Network Rail has awarded British Steel a contract worth £500 million. We will continue to ensure that there is a long-term future for British Steel, and we will keep the House and himself updated to that effect.
Callum Anderson (Buckingham and Bletchley) (Lab)
Andrew Griffith (Arundel and South Downs) (Con)
May I start by paying tribute to Norman Tebbit? He was a former Secretary of State for Trade and Industry and a great reformer who did a great deal to unleash growth in this country.
The only thing growing under this Government are the unemployment queues. Today, the Office for National Statistics revealed that the number of payrolled employees has fallen by 180,000 over the last year and 40,000 in the last month alone. Unemployment has been higher in every month since the Chancellor has been in office. In the last hour, we have heard news of another 500 job losses at Jaguar Land Rover. This is a great country with great people. When the Secretary of State talks to businesses, what reason do they give to him for unemployment rising?
Jonathan Reynolds
It is always nice to hear from the shadow Secretary of State. First, as he knows, the Office for National Statistics workforce survey shows that the overall number of jobs is higher after a year of this Government than it would have been if the Conservatives had remained in government—there are 380,000 additional jobs. He mentioned payroll jobs. Of course, they are important; they are one key factor, as is wages, which, as he knows, have risen faster in the first 10 months of this Government than they did in the first 10 years of the previous Government. Our productivity figures have also risen, and of course, we closely monitor the impacts of technology.
The shadow Secretary of State asked what businesses say to me. They say that this Government have brought stability after the mini-Budget disaster, which he was a key part of. They say that we have brought openness to the world and are navigating a difficult trading environment better than anyone else, and they recognise that our pro-business, pro-growth measures are delivering. There was nothing like the list I just gave of problems after 14 years of the previous Government.
Andrew Griffith
That answer was complacent and unsympathetic. It is the most vulnerable—those looking for their first shot, their first chance—who pay the price of unemployment.
Let us start again. Last night in the other place, the unemployment Bill was improved with sensible amendments to probation periods, a definition of seasonal workers that protects hospitality and agriculture, and provision for a consultation about the impact on the smallest businesses. Those measures have been proposed by employers, and by independent business groups such as the Confederation of British Industry, Make UK and the Federation of Small Businesses, who say that the Bill in its current form is deeply damaging. If the Secretary of State will not shelve the Bill entirely, will he at least commit to accepting those entirely reasonable amendments?
Jonathan Reynolds
The shadow Secretary of State talks about vulnerable people. Which Government left one in eight young people not in education, employment or training, while net immigration hit 1 million? It was absolutely shameful, and we will take no lessons from Conservative Members. He talks about tackling barriers; who gave us the highest industrial energy prices in the developed world? The Conservative party. Who is dealing with that? Who has put millions into skills and training, finance, and the tools that local areas need? Those are the things that businesses want.
The shadow Secretary of State also talks about the Employment Rights Bill. I regret the Conservatives’ knee-jerk ideological opposition to it; they could have been pragmatic. The Bill was a manifesto commitment, and we will deliver our manifesto commitments in full. There are issues on which we have to get the balance right, such as probation periods and the future monitoring of zero-hours contracts, and the commitment is of course real. Pragmatic engagement would have been a more constructive way forward than this knee-jerk ideological opposition.
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
The Business and Trade Committee’s inquiry on small business is still open for evidence from Members from across the House. On Tuesday, we took evidence from the chief executive of Ofgem, who made it perfectly clear that a complete collapse of regulation in the years after covid led to thousands of businesses across our country paying higher energy bills than they needed to. Can the Secretary of State assure the House that the small business strategy, when published, will contain a strategy for bearing down on the energy rip-off that is challenging small businesses across our country?
Jonathan Reynolds
I am always grateful to the Chair of the Select Committee for his helpful and pragmatic work and engagement. I recognise the issue that he has highlighted. A lot of small businesses were locked into uncompetitive contracts after covid, and the legacy of that has been very difficult. Of course, we will always look at measures to address that. Fundamentally, we must break the link that means that gas sets the price of electricity in the UK. There are no shortcuts to that; we have to get enough clean energy on to the system to make that possible, which is exactly what the Government are doing.
John Glen (Salisbury) (Con)
Gregor Poynton (Livingston) (Lab)
Does the Secretary of State agree that the UK Labour Government are getting on with the serious business of delivering an industrial strategy that will support jobs in my Livingston constituency? That is in sharp contrast to the failing SNP Government, who have no industrial strategy, no plan for workers, and no plan to support Scotland’s key sectors.
Jonathan Reynolds
I very much agree with my hon. Friend. Nationalism is fundamentally a creed based on grievance, rather than real solutions, and that stands in contrast to our approach. There are specific instances where we could deliver billions of pounds of investment to Scotland if there was a change in policy from the Scottish Government, be it on new nuclear in places where Scotland could benefit from small modular reactors, or on the recent decision to pull support for the Rolls-Royce-led plan for a welding centre for apprentices in the defence sector, which would enable them to support the maintenance of Royal Navy submarines. The SNP Government are actively making decisions that get in the way of that investment. If we cannot change their policy, let us change the Scottish Government.
Josh Babarinde (Eastbourne) (LD)
Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
On Friday, the Select Committee on Science, Innovation and Technology published its report on social media algorithms, following the Southport riots. Indeed, there is a Select Committee statement on the report this afternoon. Stakeholders have expressed concern that ongoing trade negotiations with the United States might prevent the Government from responding to the report’s recommendations, holding social media companies to account and keeping the public safe online. Can the Minister reassure us that that is not the case?
Jonathan Reynolds
I can reassure my hon. Friend and all colleagues that those decisions will always be in the domain of this Government and this Parliament in the UK. There has been a lot of speculation, during the trade negotiations, about what may or may not be involved, but we have shown that we deliver on jobs, goods and services, and that is the basis of sound trade negotiations.
Ben Maguire (North Cornwall) (LD)
Ben Goldsborough (South Norfolk) (Lab)
The over 1,000 employees at the Lotus plant in South Norfolk and Norwich North are the pride of our constituencies, and I thank the Secretary of State for his support in recent weeks. May I ask for a meeting with him and my hon. Friend the Member for Norwich North (Alice Macdonald), so that we can talk about our discussions with local employees?
Jonathan Reynolds
I can absolutely guarantee my hon. Friend that we will have that meeting. I appreciate the work that we have been able to do together, reacting to the media reports that initially surfaced. There is some clarity from the company, but not the full degree of clarity that we need. I will make sure that we get that meeting set up for him and his colleagues.
Bobby Dean (Carshalton and Wallington) (LD)
We have just had our fifth consecutive month of job losses announced, and research shows that as many as 17% of companies are considering redundancies. What is the Government’s analysis of why this is happening?
UK Steel Safeguard
Jonathan Reynolds Excerpts(1 month ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
On 28 February 2025, the UK’s Trade Remedies Authority initiated a review of the steel safeguard measure. The review assessed whether exemptions afforded to developing countries should be updated to reflect recent trade flows and whether the allocation of the tariff-free quotas across all 14 product categories were appropriate to ensure the overall effectiveness of the measure.
During the review, the TRA considered evidence from both domestic and international industry and organisations. After careful consideration of the facts, it recommended to me on 9 June 2025 that developing country exemptions should be updated and that certain changes should be made to the allocation of the tariff-rate quotas.
I have considered the evidence contained within the recommendation made by the TRA and wider matters in the public interest, including the UK’s obligations under the relevant World Trade Organisation agreement. As a result of these deliberations, I have decided to reject the TRA’s recommendation and take a different decision. The reason is to ensure the overall effectiveness of the UK’s steel safeguard measure for domestic producers while balancing the need for security of supply for the UK market.
I have decided to:
Increase the overall volume of each category’s tariff-rate quota by 0.1% from 1 July 2025.
Apply a 15% cap in the residual quota of category four and a 20% cap in the residual quotas of categories seven and 13 to ensure that UK imports from exporting countries are more closely aligned with traditional trade flows, effective from 1 July 2025.
I have also decided to amend the allocation of the tariff-rate quotas as below, in line with the TRA’s recommendation:
Prevent any unused quarterly quotas from being made available in the following quarter.
Prevent WTO members with a country-specific quota from being able to access the residual quota in the final quarter.
Update developing country exemptions based on UK import data for the period 1 January 2024 to 31 December 2024 and in line with the WTO agreement on safeguards.
This Government are unapologetic in our support for the steel sector. It is fundamental to Britain’s industrial strength, our security and our identity as a primary global power. We will not allow UK interests to suffer. Through these measures we are supporting not only our producers but also the thousands of families that depend on them and the supply chains reliant on high-quality UK-made steel.
We are determined to reverse the years of decline and neglect in the steel industry, caused in a large part by global excess capacity and market distortions. We will continue to take effective action, and we will publish our “Steel Strategy” later in the year. The strategy will bring everything together to set an ambitious vision for the sector and a more competitive business landscape.
The decision on the steel safeguard will come into effect from 1 July 2025. The Government will publish a public notice on 30 June 2025 to give effect to these decisions to enter into force on 1 July.
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UK Modern Industrial Strategy
Jonathan Reynolds Excerpts(1 month, 1 week ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
Today the Government have published and laid before Parliament their industrial strategy.
The UK’s modern industrial strategy sets out our 10-year plan to transform business investment, grow the industries of the future, deliver economic growth and put more money in people’s pockets to deliver our plan for change.
The strategy focuses on the high-growth potential sectors that will drive prosperity now and in the future: advanced manufacturing; professional and business services; clean energy; creative industries; digital and technology; financial services; life sciences; and defence. In tandem with the industrial strategy, the Government are today publishing on www.gov.uk sector plans covering the first five of these sectors, with others to follow in the coming months.
The industrial strategy follows on from the publication in November 2024 of our Green Paper entitled “Invest 2035: the UK’s modern Industrial Strategy”. Following publication of the Green Paper, the Government have considered the views of thousands of stakeholders from business, industry, academia, unions, local leaders and the public.
Today’s publication sets out how we will tackle barriers to investment and growth and make the UK the best place in the world to start and grow a business.
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UK Modern Industrial Strategy
Jonathan Reynolds Excerpts(1 month, 1 week ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
With permission, I will make a statement on how this Government are backing British business and British workers through the launch of the UK’s modern industrial strategy. At the outset, I wish to thank Dame Clare Barclay, all members of the Industrial Strategy Advisory Council and my officials for their outstanding work in preparing for the launch of the strategy today.
In an uncertain world, stability, clarity and consistency are needed more than ever. The challenges we face require nothing less than a Government who are on the pitch and clearing the way for private enterprise, and doing so in the best interests of working people. That is what this pro-business, pro-worker Government are going to deliver.
Today I launch a strategy to make Britain the best place in the world to start and grow a business, based on a fundamentally new economic approach from what we have had in the past—a break from the declinism, the dither and the disinterest that defined the last Conservative Government. The strategy speaks to the strength and breadth of our economy, be it building strong industrial foundations, powering frontier technologies, or supporting our world-leading services sector to innovate and thrive. It brings together every bit of Government to drive investment, improving the total business environment by drawing on every Department’s expertise. It is a plan to rebuild Britain through new jobs, new industries and new investments; a plan to launch thousands of new careers in engineering, life sciences, professional services and more; and a plan in which Britain’s future is designed and built in Britain.
I accept that until this Government came to power, British business was treated to a merry-go-round of policy changes that was matched only by the shuffling of successive Business Secretaries. We are now providing the stability that is at such a premium across the world. Make UK has long called for
“a funded and joined-up long-term vision as a matter of urgency for stability and investment”—
I could not have put it better myself. From the moment we took office, we said that we would pursue a new economic approach in which industrial policy would be done with business, not to business, and we are fulfilling that commitment today. I place on record my thanks to the thousands of businesses that engaged in the process and designed the strategy with us. It is not a document that will be printed and then forgotten; we will put the Industrial Strategy Advisory Council and the industrial strategy on a statutory footing to hardwire the changes for the long term.
This Government have brought stability, openness and a pro-growth agenda, but as I have told the House previously, working people must feel the benefits of economic growth. We must go further and faster if we want to achieve the kind of economic growth that the public should expect, see in their public services and feel in their pay packets. Business leaders have provided a wealth of testimony and evidence on the areas that they see as holding them back, and there are no surprises on the list. It starts with energy, because we have among the highest industrial electricity prices in the developed world at present. They went up 50% in real terms under the previous Government. Second on the list is skills, because when we have vacancies at the same time as one in eight young people are not in education, employment or training, and net immigration is at 1 million, as it was when we took office, something has gone badly wrong. Thirdly, there is place, because too much of the country has been held back by crumbling infrastructure and a lack of investment due to the north-south divide—and that ends now. We will make the bold choices to ensure every region and every nation can play to their strengths. Finally, there is access to finance, because without access to capital we will always have a ceiling on ambition. Today, we have smashed through these barriers.
Let me take each of those four in turn, starting with energy. Today, we have announced that we will slash electricity costs by between 20% and 25% through a new British industrial competitiveness scheme. This will bring our prices more closely in line with those in Europe, and it will be a game changer. We will also put in place the reforms we need for businesses to get the much faster connections to the grid that they need. That means companies in sectors such as car making and chemicals will see their electricity costs cut. The scheme could benefit over 7,000 businesses with high electricity usage in industrial strategy foundational industries and high-growth manufacturing sectors, which collectively employ over 300,000 skilled workers.
We will also launch an expanded version of the supercharger scheme, so that some of our largest companies in electricity-intensive sectors—including investments of the future such as the new steelworks’ electric arc furnace at Port Talbot and the Agratas gigafactory in Somerset—will see their network charging exemptions rise from 60% to 90%, cutting their electricity bills and again making them more competitive than our European neighbours. Although the previous Government promised that to business, they again failed to deliver. I confirm that this will all be done without adding a penny to consumer bills or those of any other business.
Secondly, we are shaking up the skills system to prioritise digital, engineering and defence skills, so British workers can secure good, secure jobs in tomorrow’s economy. Our industrial strategy sectors are already on track to create 1.1 million new good, well-paying jobs with the help of this industrial strategy, and we want those opportunities to benefit all our constituents. That is why we are investing over £275 million in our engineering skills package and the skills mission fund to deliver training and new technical excellence colleges as part of our wider skills offer. Through our global talent visa reforms and the global talent taskforce, we are also ensuring that UK businesses can recruit the best of the best from here and abroad.
Thirdly, the issue of place—the economic geography of the UK—means a great deal to me and many of my colleagues, who listened to the grand plans to level up that turned into a few extra flowerpots and empty promises. I want to be clear that this strategy is unashamedly ambitious. It chooses to back places where there are clusters of high-growth sectors, and it will work with devolved Governments, Mayors and local leaders to boost that growth.
We are making it easier to get money to places and turn investment into spades in the ground and cranes in the sky through industrial strategy zones, which will bring together our existing network of freeports and investment zones. We will also, for the first time, include a new programme identifying investible sites where we will fast-track development, similar to the approach taken in France. However, our infrastructure must match our ambition, so we will strengthen connections between city regions and clusters through the Oxford-Cambridge growth corridor, the growth corridor across our northern city regions, the Edinburgh-Glasgow central belt and rail enhancements in Wales.
Finally, we will unlock billions of pounds in business finance, with the National Wealth Fund supporting our growth sectors, an expanded role for UK Export Finance and £4 billion growth capital for start-ups and scale-ups through a larger British Business Bank, addressing at scale the key stage that we know is the most challenging. This growth capital will catalyse £12 billion of private capital across the eight growth-driving sectors and deliver around £30 billion of additional gross value added to the UK economy.
These measures, alongside our transformative sector plans, are how we can realise the untapped potential in key parts of our economy. For instance, by 2035 we aim to double business investment in advanced manufacturing, increasing the volume of vehicles produced in the UK to 1.3 million, while creating the first European market for self-driving vehicles. We are turbocharging our clean energy mission with investment in offshore wind, small modular reactors, carbon capture, green hydrogen, gigafactories, ports and green steel. We will make our United Kingdom one of the top three places in the world for creating and scaling digital and technology business. That means training 1 million young people in tech skills and expanding our Al research resource by at least twentyfold by 2030. We will significantly increase business investment in our world-leading creative industries sector to £31 billion, cementing our position as one of the great creative exporters in the world. For our life sciences sector, our ambition is that the UK will be, by 2030, the leading life sciences economy in Europe, and, by 2035, the third most important life sciences economy globally, after the US and China.
At the same time, we plan to double business investment in professional and business services to £61 billion, ensuring the continued growth in a powerhouse industry that accounts for millions of jobs in the UK, the vast majority outside London. We have already announced the largest increase in defence spending since the cold war and will use this to transform the UK into a defence industrial superpower by 2035, leading Europe in defence exports and closing the gap with the US by half in venture capital investment in defence. For our financial services, the heart of business investment and stability, we will harness opportunities as markets digitise and adopt new technologies, and ensure the whole economy feels the benefits of increased investment.
The industrial strategy also ensures that places and sectors can take full advantage of the UK’s position as a global hub for trade. The UK has long been and will remain a champion of free trade, which is why, under this Government, we have delivered trade agreements with our biggest trading partner in the world, the biggest economy in the world and the fastest growing economy in the world, making the UK the best connected market in the world. Through this industrial strategy, we are reaffirming our commitment to free and fair resilient trade, while shielding businesses from supply chain disruption and market-distorting practices. We will leverage our relationships with Europe, the US, China, the Gulf and beyond, so that businesses can make the UK their base to connect with global markets. It will work hand-in-glove with the trade strategy, which my Department will publish later this week, to help British companies break into new markets, export more and grow more.
This is a watershed moment. For too long, Governments have been a source of problems for British business, not a path to solutions. The result, in parts of the country where I and many of us here grew up, was that we watched yards and factories close, along with the door to opportunity. There was a sense that we were losing the past, but we had no bridge to the future. That also ends now, because our plan for change is backing this country’s greatest assets and frontier industries to put more money into people’s pockets, raise living standards and unleash a decade of national renewal. I welcome Make UK’s comments that
“Today is one of the most important days for British industry in a generation.”
We are creating a prosperous, proud and outward-facing but self-reliant, independent and high-skilled nation; a country where opportunity, skills and wealth are spread fairly, and where every person and every business have the chance to flourish. That is what our modern industrial strategy will deliver. Our future, in our hands, built in Britain: that is what the strategy will achieve. I commend this statement to the House.
Several hon. Members rose—
Andrew Griffith (Arundel and South Downs) (Con)
I thank the Secretary of State for advance sight of his statement.
It is always a good day when we can talk about our wonderful and innovative British businesses, but, sad to say, this strategy has taken the best part of 12 months to appear. That is how long British industry has had to wait for this cut and paste industrial strategy; 158 pages mostly copied and pasted from previous sector strategies and the science and technology framework, which do nothing to alleviate the pain and turmoil that Labour has already inflicted. In those 12 months, Labour has crashed the economy—[Laughter.] Labour Members are laughing, but unemployment has been up in every one of the nine months of this Government, with hiring and investment down. I understand that this document is printed on 40% recycled paper—very much like its content.
Yet there is no respite for businesses from the decisions that have been taken. The Secretary of State talks about restoring stability, and that may well be what was written for him, but he, like me, listens to businesses, so he cannot possibly believe that. The Government have hiked taxes by £40 billion when they promised not to, and gilt rates are higher today than after the mini-Budget; they fiddled the fiscal rules and are now running out of headroom, all while setting up state investment banks in a repeat of the previous Labour Government’s private finance initiative. Higher taxes, higher energy costs and more red tape on employment—the proposals set out in this document are simply insufficient at a time when businesses need far greater measures to defend them from the minefield that Labour has left out.
There are many elements of this strategy that we do welcome. I am pleased that the Government have continued the work the former Chancellor and I undertook on access to capital, and it is good to see an emphasis on trade and international co-operation, particularly with the document’s focus on Japan and Saudi Arabia. I am glad that the Government are implementing the O’Shaughnessy reforms and turning the NHS into a global platform health data research service.
It is encouraging to see the weight given to autonomous cars, although it is curious that there is no mention of the opportunity of driverless trains. I am disappointed that the life sciences and engineering biology receive relatively modest mentions. There is a minor mention of skills reform, but there is no mention of real deregulation to our labour market and a near absence of references to small businesses, which account for the majority of businesses and employment in this country.
The big miss, however, is on energy. We welcomed the Prime Minister’s epiphany this weekend when he announced he would slash green levies on a certain number of businesses. However, the industrial strategy still talks about accelerating to net zero at a time when British business needs the opposite. It is simply mad. Rather than the Business and Trade Secretary—sitting next to the Energy Secretary on the Front Bench—addressing the root causes of high energy costs, this Government seem intent on adding to the web of complexity of taxes, levies and subsidies. There is nothing in the strategy about reopening the North sea—the energy reserves that lie under our own secure feet. It even compounds the problem by imposing further self-harm through a carbon border adjustment mechanism—a tariff by another name—which will cost businesses and consumers in this country dear.
How can anyone outside this postcode running a business believe that Labour intends to cut the regulatory burden when it has set up new quangos at the rate of one every two weeks, including in the Business Secretary’s own Department? How can anyone outside Whitehall looking at the regulations take seriously the commitments in this document, when the Secretary of State’s own Department is guiding through the House 300 pages of trade union-written employment law, which will force employers to cut hiring and jobs?
I will conclude with a number of questions. If the Secretary of State cannot answer today, perhaps he would be so kind as to write with a reply. The small business strategy was promised for the spring, but the summer solstice is now behind us. Can he tell the millions of businesses when it is coming?
There are a number of live situations that the Secretary of State will be aware of, including the bioethanol plan in Saltend Chemicals Park in Hull, Syngenta moving its precision wheat breeding programme to France, and the Government equivocating over supporting the stake in the vital low Earth orbit satellite operator OneWeb. Does the Secretary of State agree that it is actions, not words, that count, and will he impress that on his Treasury colleagues?
Finally, the strategy does talk about reducing the number of regulators, which is wholly welcome, as we need a marked cull in the number of regulators and their scope and size. Will the Secretary of State commit to publishing an annual statement showing the progress his Government are making on that, and will he start today by agreeing not to create any new ones?
Jonathan Reynolds
So fuelled by optimism am I today that even the shadow Secretary of State cannot bring me down. Having been in opposition for some time, I can say that, “This document is all rubbish and I welcome most of it,” is quite an exciting take on a response. The Conservative party has managed to oppose almost everything that the Government have done in their first year, including, in my Department, the Product Regulation and Metrology Bill, which the previous Government were planning to introduce had they remained in office, and the India trade deal, which they were negotiating but could not get across the line, so I welcome the small bits of positivity in his response.
Everyone across the House should support the strategy. It is based on things that will not be secrets to hon. Members who spend time with businesses on constituency Fridays and at weekends. They will be told about skills, energy, access to finance and how local areas should have the powers to address the needs in their local economies. I hope that the shadow Secretary of State would recognise, in good spirit, that many of the problems that need to be addressed grew under the Conservative Government. For example, the fact that energy bills became so uncompetitive was a result of actions and decisions of the Conservative Government. We are fixing that problem, in order to make a difference.
On skills, one in eight young people are not in education, employment or training, while net immigration is at 1 million. That is not a policy success. It needed to be addressed. We needed to address, too, the failures on the funding of courses such as engineering. That was such an obvious need for our sectors. Finance is one of the longest-running problems; we are all familiar with it.
The shadow Secretary of State asked a number of questions, and I am more than happy to answer them. On small businesses, if he reads more of the detail when he has a bit more time, he will see that small and medium-sized enterprises play a vital role in the creative industries and defence sector plans. To anyone who asks, “What’s the message to businesses that are not in sectors covered by the industrial strategy?” I say that they will benefit from people having good jobs and high incomes. Whether they are in hospitality, retail or leisure, they will see a direct benefit from the strategy. The small business plan will come out in July, and it will deal with issues such as late payment, business support and access to the kinds of tools—rental auctions and so forth—that will make a difference on the high street.
The shadow Secretary of State attacked net zero. That is a mistake. Why would we turn our back on billions of pounds of investment and all the benefits it could bring? In particular, becoming a country that is not so reliant on volatile foreign gas prices is an obvious thing that we would not want to turn our back on. He seemed to announce a new Conservative position of opposing CBAMs, which deal with carbon leakage and create a level playing field. I am surprised by that, because the previous Conservative Government were strong advocates of them.
On the bioethanol industry, talks continue with the two plants most directly affected. Of course, they were in a challenging position before the US trade deal; the deal was not in itself the cause of that. They were losing money. If I intervene, I must have a route to profitability, and that is the basis of those conversations. We are committed to precision breeding. Businesses that moved to France would find a more restrictive environment there because of EU regulation, so I would not recommend that.
On OneWeb, there are some specific issues, about which I would be more than happy to talk to the shadow Secretary of State. On regulation, we have already taken decisive action, for example with a strategic steer to the Competition and Markets Authority, which has been warmly welcomed by businesspeople. They ask me for more of that, and that is exactly what we intend to bring forward.
Finally, let me say, because I know that this is so important to colleagues, that I am more than happy to offer a briefing to any Front-Bench spokesperson or group of colleagues across the House. There is so much in the strategy that will make a difference and so much detail worth sharing, and I would be more than happy to do so with colleagues. Let us all get behind the strategy and get behind British industry.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Chair of the Business and Trade Committee.
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
I congratulate my right hon. Friend on the biggest remaking of the relationship between the public and private sectors for a generation. The business community in this country will be stronger and better for the measures that he has announced today. Business will welcome in particular the huge investment in skills, access to research and development, and access to capital, but the game changer is the investment in energy that he has announced. Cutting industrial energy prices is a way to get rid of the albatross around the neck of British business. It is a big promise; can he assure the House that there is both the plan and the pound notes to deliver on it?
Jonathan Reynolds
I warmly welcome those words from the Chair of the Select Committee. I absolutely agree with him. There is so much in the strategy, but we were so uncompetitive on energy that whether action could be taken had become a test of credibility from business. The kinds of changes we are talking about—a reduction of £35 to £40 per megawatt-hour by exempting eligible businesses from payments for the renewables obligation, feed-in tariffs and the capacity market—will make a real difference. We are talking about going from being the absolute outlier to, today, being cheaper than Italy and the Czech Republic and on a par with Germany. That is a game changer, and it has been welcomed. We will obviously have to consult; we can make the changes to the supercharger more quickly than we can introduce that support. Of course, we will have to set a threshold intensity test and make sure it goes to the sectors in most need of it, but we expect those to include the core foundational sectors as well as aerospace, automotive and all the areas where the competitive pressure is most acute. I am incredibly excited by that.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Sarah Olney (Richmond Park) (LD)
The Liberal Democrats have long been champions of the industrial strategy. We are proud that the strategy we introduced in government set out the Green Investment Bank, the British Business Bank and the regional growth fund, and we strongly opposed the Conservative Government’s damaging decision to scrap our country’s industrial plan. We therefore welcome the re-establishment of the industrial strategy and the fact that it focuses on many of the sectors we prioritised in government, including life sciences, professional services and clean energy.
On energy, measures to bring down some of the highest industrial prices in the world will be welcome news for our manufacturers and energy-intensive firms, but we cannot forget that businesses across our entire economy struggle with high energy prices, not least our hospitality businesses and small and medium-sized enterprises. What steps is the Secretary of State taking to ensure that small businesses across sectors have access to better energy deals? Will he look to bring forward the industrial competitiveness scheme from its current two-year horizon?
On skills, while today’s announcement comes with a welcome funding boost, it stops well short of the fundamental reform that we need, so will the Secretary of State accelerate the reform of apprenticeships and empower Skills England to act as a properly independent body with employers at its heart? One key omission from the strategy is our world-leading agrifood industry, which has been relegated from being a priority sector to receiving only a handful of mentions in the entire document. I hope that the Secretary of State will admit that our farmers and rural communities deserve far better. On trade, if the Government are truly serious about backing British business and going for growth, will they show more ambition on trade with Europe and look to negotiate a new UK-EU customs union, which could put rocket boosters under UK plc?
In the extra time that you have kindly granted me, Madam Deputy Speaker, I want to ask the Secretary of State about access to finance and about addressing inequalities in particular. As chairman of the all-party parliamentary group on ethnic minority business owners, I have seen for myself the data on how much more difficult it is for those businesses to access finance, and similar data exists for women entrepreneurs. Addressing those inequalities would add a great deal to growth. Finally, when will we see more details about the National Wealth Fund?
Jonathan Reynolds
I warmly welcome the hon. Lady’s support. That section of the Liberal Democrat manifesto was very well written, whoever was responsible for it. There was much that we can all get behind, and it very much made the case.
The hon. Lady is right to say that the Liberal Democrats in government supported the approach we are taking. By the way, I have talked to nearly every one of my living predecessors across the political divide—not all of them, but the ones who have done this kind of work and made a difference. There are some new things in the sectors that we have picked. The creative industries are a brilliant economic, soft power and cultural strength of this country, so it is great to see them included.
On the timescale for energy policy changes, I know that the people who recognise the burden want to see action quickly. I want to see action as quickly as possible. I can make changes to the supercharger scheme and the generosity of it more quickly because it is an existing scheme and the intensity threshold is already in place, but the industrial competitiveness scheme will require legislation to implement it, and that will take more time, depending on how co-operative colleagues are across the House.
I welcome what the hon. Lady said on skills. Skills will always be the No. 1 issue that any business raises with its Member of Parliament. I recognise the case she makes about a fundamental reform. Since the apprenticeship levy was introduced, employer investment in skills has gone down, and that is not what any of us want to see. We will ask Skills England and the industrial strategy council to work more closely on what businesses need to invest in more, and we will ask them to report by the Budget to see whether we can take forward a more comprehensive set of changes. The Department for Education owns that part of the policy, of course, but this is a cross-Government industrial strategy, as it should be. On agrifood, it is a subsector of advanced manufacturing, so the hon. Lady should not worry, because it is included.
The only item of disagreement is trade. I would say that this Government are managing the pressures of international trade better than any other country in the world. The customs union that the hon. Lady proposes would mean that we could not have the trade deal with India, which has brought down tariffs on salmon, Scotch whisky and automotive vehicles. It would mean that we could not have the agreement with the US, which has saved tens of thousands of jobs, so I cannot agree with her on that point. I think we should have closer trade with Europe, the US and the rest of the world.
Finally, I thoroughly agree with the hon. Lady on access to finance, and I appreciate that point. This is a core business and economic issue for the UK, not a minor issue. The level of finance that is going to female entrepreneurs, for instance, is not sufficient. We have already explicitly backed some significant campaigns through the British Business Bank and I stand ready to do more. I recognise the important case she makes.
David Williams (Stoke-on-Trent North) (Lab)
I welcome this incredibly positive industrial strategy that will help us to harness Britain’s potential. The strategy rightly recognises that Stoke-on-Trent has been at the heart of the ceramics industry for centuries. Therefore, will the Secretary of State outline what the industrial strategy means for both our traditional ceramics companies, which produce the finest tableware, and for advanced ceramics with a view to the future?
Jonathan Reynolds
I very much welcome my hon. Friend’s comments in welcoming the strategy. There is a great deal that I could go through. I would get in trouble with you, Madam Deputy Speaker, if I mentioned the benefits for every sector in the document, but I think we would all recognise the pressure on the ceramics sector through energy prices—much of the industry is gas-intensive, and there are not policy tools for dealing with that in the same way. Only a small number of ceramics businesses currently benefit from the supercharger—I think only eight in total—which is why the test for the British industrial competitiveness programme is a different one. There will be a proper process to assess thresholds and eligibility, but it is designed in such a way that foundation sectors—ceramics is very much included in the material side of that—would get the benefit of the programme.
Martin Vickers (Brigg and Immingham) (Con)
Belated though it is, the announcement about energy costs is obviously vital to the steel sector. The Secretary of State is well aware of the situation in Scunthorpe. Will he give an assurance that, for the foreseeable future, production of virgin steel will continue in Scunthorpe? Will he work with North Lincolnshire council, which has plans for redeveloping the redundant parts of the site, particularly in respect of an AI growth zone?
Jonathan Reynolds
I thank the hon. Member very much for his work. I think the whole House knows of my personal interest in steel and the measures we have taken, including the recall of Parliament and the passing of the Steel Industry (Special Measures) Act 2025 that was required to save his constituents’ jobs. He is right that the investment required in some of the most electricity-intensive opportunities of the future—electric arc furnaces, for instance, were we to go down that route at Scunthorpe —requires the kind of programme that the enhanced supercharger level will get to because of the measures outlined in the strategy.
There is not yet a plan for transition at Scunthorpe. As the hon. Member knows, we have taken control, but we need to resolve the issue of ownership. We continue to run the plant in a way that minimises losses to the taxpayer. That has meant putting more money in up front to run it at full capacity, which I think he will very much support. We will continue to work with anyone in the local area, including him and my hon. Friend the Member for Scunthorpe (Sir Nicholas Dakin), to ensure that there is a bright future for the steel sector. I believe that will be possible based on the policy environment we are putting in place.
Dame Chi Onwurah (Newcastle upon Tyne Central and West) (Lab)
As Chair of the Science, Innovation and Technology Committee,, I really welcome this modern industrial strategy because it delivers on the promise Labour made in opposition to put science, innovation and technology and the skills they require at the heart of the drive for growth and industrialisation. I also welcome the strategy as a north-east MP because of the emphasis on regional growth and regional strengths.
My Committee found that one of the major barriers to regional growth and innovation was access to capital. The industrial strategy commits to doubling business investment by 2035. Will the Secretary of State say a little about how the north-east—just for example—might benefit from that?
Jonathan Reynolds
First, let me congratulate my hon. Friend on her recent honour. [Hon. Members: “Hear, hear!”] I know that she is not one for a fuss, but it is inspiring, and it is great to see that recognition.
My hon. Friend is right that access to finance is a pillar of the industrial strategy. For instance, in the spending review, the British Business Bank’s capacity was increased to up to £4 billion, and the maximum ticket it could write was increased to £60 million as part of that. We also had a huge increase in the capacity of UK Export Finance in the spending review—as my hon. Friend knows, the north-east is a huge exporting region and has the most positive balance of payments of any English region—and its direct lending capacity has increased as well.
We now have a story on finance from UKRI and Innovate UK for innovative start-ups, to the British Business Bank for scale up and maturity, going to the National Wealth Fund, and UK Export Finance supporting every part of that journey. That comprehensive offer is detailed in this strategy document, and it will benefit all parts of the UK, including of course the north-east of England.
Rebecca Smith (South West Devon) (Con)
I welcome the announcement of Plymouth’s defence cluster and the national centre for marine autonomy. I am proud that much of this work is being done in my constituency at Turnchapel Wharf and soon at Langage in the Plymouth and South Devon freeport, and that it includes Smart Sound, all of which were supported by the last Conservative Government. Indeed, this did not really need a special name as it was already happening. The Chancellor’s spending review speech initially included mention of £4 billion for autonomous systems split between three locations including Plymouth yet, when checked against delivery, this element was missing. Please can the Minister clarify what funding is available for these autonomous systems’ development in the strategy, in addition to the money announced for the submarine and continuous at sea deterrence programme at His Majesty’s naval base Devonport?
Jonathan Reynolds
Well, I think that was a positive response to the industrial strategy. It certainly sounded like there were some positive themes there. The hon. Member asks a reasonable, specific question about her constituency, and I will check that with officials and write to her so that she has the correct information. If she has had a chance to look at it, she will see that the strategy includes big commitments to the advanced manufacturing R&D budget for a whole range of sectors. We are putting in the money that perhaps was not as firm as it is now in the national finances, but we also have long-term plans in many of those sectors around quantum, advanced manufacturing and aerospace 10-year settlements, for example, to give the kind of assurance and consistency we really need, but I will get her the specific answer she needs.
Antonia Bance (Tipton and Wednesbury) (Lab)
Representing Tipton, the birthplace of the first industrial revolution, I hugely welcome this industrial strategy and its 1.1 million good jobs. I am particularly pleased to see the Black Country singled out as a centre of clean-energy industries. We recently welcomed £45 million of investment in Eku Energy’s new battery energy storage system at Ocker Hill in my constituency. The action on high energy prices is especially welcome, and I wonder if my right hon. Friend could give us more details about how soon we can expect it to make a difference to businesses in our constituencies.
Jonathan Reynolds
The birthplace of the industrial revolution is somewhat contested by several of us Labour MPs, but we do not need a vote on that. My hon. Friend’s constituency certainly has a rich history and a great future for her constituents, who have been well represented by her since the election. On energy prices, we all want action sooner rather than later. There are some parts of the programme that I can implement more quickly than others, and I have to do this in the proper way and let people consult on the threshold. In my Department, we are often dealing with big inward investment decisions or existing domestic business investment decisions, and if they can have certainty as to where they will get to in a short space of time—many of these are investments that pay back over not just years but decades—that will make the difference. I believe that the benefits can be felt even sooner than the programme can be put in place, but I promise I will stretch every sinew to get it in place as soon as we can.
Mr Joshua Reynolds (Maidenhead) (LD)
Businesses have told me how important it is to have a front door for public finance. The strategy references Innovate UK, the British Business Bank, the National Wealth Fund, UK Export Finance, Invest Northern Ireland, the Scottish National Investment Bank, the Development Bank of Wales, Great British Energy and the Office for Investment, so does the Secretary State believe that businesses know where public finance’s front door is, and that this is as simple as it could possibly be?
Jonathan Reynolds
I welcome the question from my honourable namesake. I hope he is not still getting my emails; I get a few of his, and I try and help out where I can on those local issues. He is right: we have inherited a lot, and there is a devolved landscape to this as well. People often ask—we had a conversation in the Select Committee about this—why we do not bring them all into one organisation. It is important to understand that they play key different roles. I cannot remember what page of the industrial strategy it is on, but the different parts of the journey those different organisations represent are specifically addressed. They are there to do different things.
Of huge interest to me is the scale-up point—the serious business-to-consumer point. I think people recognise that there is a lot of capital in the world, but the question is whether it matches the risk profile and opportunities of businesses in the UK. We all recognise the tremendous innovation in this country, but do we always get the long-term benefits of that scale-up happening in the UK rather than going abroad? We do not, and that is what we are seeking to fix. That is the fundamental mission that we are all united behind.
Mr Luke Charters (York Outer) (Lab)
My hon. Friend the Member for Aldershot (Alex Baker) and I have published a report highlighting the persistent scale-up gap for defence SMEs. I welcome the increase in funds for nationally significant infrastructure projects, but red tape is holding back investment in British single-use military technology, so will my right hon. Friend look at clearing up some of that red tape in order to supercharge investment in British defence SMEs?
Jonathan Reynolds
I very much welcome the question and the work that my hon. Friend has done. He has been an ally in ensuring that there are no problems around the defence sector being seen as a legitimate source of business investment and economic activity. We recognise why we need that in the national interest, but we should not in any way be squeamish about the contribution that defence makes because the deterrence value is a fundamental contribution to peace, as well as to economic security.
I can tell my hon. Friend that the strategy commits us to double the amount of the defence budget that goes specifically to SMEs, rising to £2.5 billion a year. SMEs, in diversifying the defence supply chain and creating those opportunities, are absolutely a part of this strategy, and if he has any red tape to show me that we need to get rid of, let’s work together to get rid of it.
Kit Malthouse (North West Hampshire) (Con)
I draw attention to my entry in the Register of Members’ Financial Interests. This is the sixth industrial strategy announced from that Dispatch Box since “New Industry, New Jobs” by Gordon Brown in 2009. While they have all been filled with a box of chocolates selected by the Secretary of State, with his or her preference often underpinned by a huge subsidy, not a single one of them has made any significant difference to the UK’s growth rate, and that is because they all miss a particular piece of the jigsaw. I urge the Secretary of State to recognise that the Government can build as many roads and bridges as they want, train as many young people as they like, pump as much money into the British Business Bank as they want, but unless they can find individuals to take a risk with their own capital, they will not get any investment. Unless these individuals can see a return on that capital, they will not invest. I urge him, as we move towards a Budget in November, to work with the Chancellor of the Exchequer to increase entrepreneurs’ relief, cut capital gains tax, and reduce the taxation on dividends so investors can see a return on their risk.
Jonathan Reynolds
I hesitate to say this, but I think the right hon. Gentleman underestimates the number of strategies there have been in recent years. It is certainly more than six; we are at 11 in the past decade, or something like that. There have been six Business Secretaries in five years, which is certainly far too many. I think we can all agree that we need some long-term consistency in that area alone.
I agree with the right hon. Gentleman’s point on risk. That is one of the more thoughtful contributions I have heard on the low economic growth, mainly under a Conservative Government, since the financial crisis. We have to consider that attitude to risk in terms of regulation. Maybe our role as parliamentarians, when we ask regulators to fix every problem and stop every bad thing happening, is to ask ourselves whether that is the right balance, whether that is a reasonable request, or should it be—of course, with that in mind—proportionate to the performance of the economy.
The right hon. Gentleman mentions some specific measures. We have the lowest corporation tax in the G7 and a competitive tax rate overall, but we are always seeking to improve that. We need supply side tools, fiscal changes and a consistent long-term environment. That is what we seek to put in place.
Rachel Taylor (North Warwickshire and Bedworth) (Lab)
This morning, I visited Horiba Mira, which employs thousands of people across the west midlands. It was a privilege to visit with the Prime Minister, the Secretary of State and the Chancellor. I am sure that the Secretary of State will agree that one of the highlights of that visit was the excitement on the apprentices’ faces. After 14 years of low investment in the west midlands under the Conservatives, does he agree that this industrial strategy will deliver opportunities for young people and the manufacturing industries in North Warwickshire and Bedworth?
Jonathan Reynolds
It was a pleasure to see my hon. Friend this morning with my right hon. Friends the Prime Minister and the Chancellor. I was absolutely blown away by that facility, not just by the obvious “big name” investment from the companies there, but by the young people in particular. Of course, we are trying to deliver a strategy for business, and that requires businesses to have access to the pipeline of people, talent and skills that they need. Within that story, there are so many opportunities and careers for young people. I find that absolutely inspiring. Having an offer for the kind of apprentices and advanced manufacturing we saw today, alongside pride in our service and creative sectors and what we are doing on defence, is all key to ensuring that there are not just the things we need as an economy, but equities and opportunities for young people, as there should be in every part of the UK, to get the lives that they deserve.
Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
While the UK Government announced a strategy that, as usual, barely gives Scotland any news, the Scottish Government under the SNP have just secured Scotland’s position as the highest ranking destination for foreign investment outside of London and the south-east for the 10th year in a row. While the UK Government refuse to see Scotland’s potential, the rest of the world are lining up to invest in us—think of what we will achieve when we are independent. Does the Minister accept that the only obstacle to Scotland’s success is the continuing devastation of a Brexit that we did not vote for and a UK Government that stubbornly refuse to see Scotland’s potential?
Jonathan Reynolds
Well, you can’t please everyone, can you? I am depressed just from listening to that question.
On the substance of the hon. Member’s question, he is categorically wrong. Look at what we are proposing for clean energy and what that means for Scotland. Look at the new supercomputer in Edinburgh and what that means for tech and digital. Look at the creative industries and the brilliant opportunities there. Look at the ambition on net zero and all the opportunities for investment in Scotland while cutting industrial energy bills.
Of course, there are parts of the strategy that respect the devolution settlement, as we would expect. Skills is something we can only address in England. The money has gone to the Scottish Government for whatever they want to do to take that forward. That is just the nature of a national industrial strategy that respects the devolved settlement. Independence would be ruinous for the economy. It would shed Scotland’s renewable energy potential from the customer base in England. I believe that at the time of the independence referendum, the SNP wanted a UK energy market anyway. If the hon. Member was being honest and candid, he would recognise that there are things that come from the massive strengths of the Union, come what may. This is a strategy that speaks to building on those opportunities for every bit of the United Kingdom, especially Scotland. Scotland’s economy could be described by the eight high-potential industrial strategy sectors in this document, so let’s have a bit of optimism and hope for Scotland.
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
I welcome my right hon. Friend’s statement and the doubling of business investment by 2035. I particularly welcome the £4.3 billion of funding for the advanced manufacturing sector, which will directly benefit the AMIDS—advanced manufacturing innovation district Scotland—factory in Renfrewshire, which is in Scotland. Can the Minister say more about how he will work hand in hand with the devolved Administration in Holyrood to ensure that the delivery of the strategy is tailored to local strengths?
Jonathan Reynolds
There is the true voice of Scotland—it is fantastic to hear that optimism and pride for the future.
My hon. Friend is right that there are huge advantages for her constituents in this strategy, which commits the kind of quantum of funding on a long-term, committed basis on R&D, which cuts industrial energy prices and does things across the board. There is so much that is part of the strategy. If I were to break down each of those sectors, I could be here for hours. You would probably get upset with me, Madam Deputy Speaker, if I read out each of the measures that are part of the strategy.
As I said in answer to the previous question, when we are doing a national industrial strategy, we—entirely rightly—have to respect the devolution settlement, and there are some supply-side areas of industrial strategy that I as the UK Secretary of State do not have control over. It is right to reflect that, to build on that where we can and to work in partnership where we can. There are things I would like of the Scottish Government. If we think of Scotland’s tremendous pedigree in civil nuclear power, all that investment is denied to Scotland because of the policies of the Scottish Government. I have my frustrations, but I will work together where we are able to do so to produce the best outcome for Scotland.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Select Committee Member Charlie Maynard.
Charlie Maynard (Witney) (LD)
The Secretary of State said,
“The UK has long been and will remain a champion of free trade”
—if only! It is not on the big stuff or the important stuff. Leaving the EU’s customs union and single market has reduced UK GDP by between 2% and 4%. The deal with India is good news, but according to the UK Government’s own estimate, it adds 0.1% in the long term—that is, 20 to 40 times smaller. UK exports are down 13% since the trading co-operation agreement took effect. That impacts people in my constituency and all hon. Members’ constituencies. When will the Government move faster to repair the enormous economic damage of a hard Brexit?
Jonathan Reynolds
I understand the point that the hon. Gentleman makes. This was the question that faced the nation at the time of the referendum. If a country leaves a single market and customs union, there will of course be economic consequences, particularly when there is the free movement of people, but that is the decision the country took. Let’s look to the future, not the past. We could have this argument forever. We would have a situation where the business uncertainty created by never fundamentally coming to a settlement on Brexit would in itself become as big a problem as the impact of leaving the single market that he talks about.
Of course, if we were in a customs union without being part of the EU, could a G7 economy subcontract that area of policy entirely to other countries and not have control of a key aspect of our economy? Honestly, I do not think that is reasonable. I appreciate the Liberal position is almost certainly to go back into the European Union—there is consistency there—but I say again that doing so would mean, for instance, denying us the benefits of the India trade deal and services access to India, the reduction of tariffs on agriculture, whisky and cars, and the benefits of the US agreement, which has saved tens of thousands of jobs.
Rachel Hopkins (Luton South and South Bedfordshire) (Lab)
I welcome the ambition behind the Government’s industrial strategy, a bold 10-year plan to unlock Britain’s potential. Will the Minister outline how the strategy will align skills provision, particularly vocational and technical training, with the needs of our high-growth sectors such as advanced manufacturing and clean energy?
Jonathan Reynolds
I am getting the impression that you would like more brevity from the Front Bench, Madam Deputy Speaker, so I will just say that the skills packages will put more funding into courses, and the flexibilities required on those courses that matter, with more capital funding for technical excellence colleges, while ensuring that that is available to every part of the UK.
David Reed (Exmouth and Exeter East) (Con)
I was glad to hear defence running through the Business Secretary’s statement. Will he tell us how much equity the authors of the strategic defence review had in the compilation of the UK modern industrial strategy?
Jonathan Reynolds
I very much welcome that question. The Ministry of Defence has been a partner in the defence industrial strategy, which mirrors and is closely aligned with, as one would expect, the strategic defence review and the big increase in spending under this Government.
Sonia Kumar (Dudley) (Lab)
I warmly welcome the statement. Will the Secretary of State outline what measures are being taken to ensure that towns like Dudley—which is actually the birthplace of the industrial revolution—receive their fair share of economic regeneration and job creation, and that the current infrastructure in cities is further invested in to generate growth?
Jonathan Reynolds
I very much appreciate my hon. Friend’s question. She will see a whole range of tools in the place section that are available to both mayoral and non-mayoral areas, which will help to shape local economic plans. She will also see measures to attract inward investment and to strengthen its voice in all the regions, and a whole range of policies that speak directly to business. We are building on the tremendous history and expertise in her area; it will be good news across the board.
Mr Gregory Campbell (East Londonderry) (DUP)
The Secretary of State will be aware of the future towns funds, one of which is in Coleraine in my constituency. I want to see many more apprenticeships created through that fund. Will the modern industrial strategy that he has unveiled today be flexible enough to allow funds like that to utilise it to get additional resources, to make them even more successful than they have been so far?
Jonathan Reynolds
There are parts of the skills package that allow for short courses, more flexibility and more foundational apprenticeships, which I think speaks exactly to the challenge the hon. Gentleman puts. If he writes to me on any specific issues relating to the towns fund in his constituency, I will get those answers.
Anneliese Dodds (Oxford East) (Lab/Co-op)
I welcome my right hon. Friend’s determination to reduce energy costs. He has heard about the need for that from me, from many other colleagues and from industry, and he has acted. The previous Government did not act; he has gripped on to this. I welcome that, because it will level the playing field for UK automotive, including for BMW Cowley. Of course, we also need action to incentivise domestic electric vehicle production, rather than the purchase of foreign-made electric vehicles. Will that be included in the ZEV—zero emission vehicle—mandate refresh that is referred to in the strategy?
Jonathan Reynolds
I thoroughly welcome my right hon. Friend’s question and thank her for all her support for our determination to make sure we have the competitive automotive sector that we all want. She is right that the changes to the ZEV mandate are part of this. They were brought forward because of the pressing urgency—I was not happy with the situation that I inherited from the Conservative party. We closely review the level of consumer demand in the sector and are always willing to work with her and the tremendous businesses in her constituency to make sure we are getting this country’s markets to where they need to be.
Alison Bennett (Mid Sussex) (LD)
Consort Frozen Foods, which is based partly in Burgess Hill in my constituency, distribute ice creams across the UK. It does some distribution overseas as well, but I met its representatives recently because they really wanted to understand how best to access more markets. What advice does the Secretary of State have for Consort Frozen Foods?
Given the comments of the hon. Member for Arundel and South Downs (Andrew Griffith), I also wonder whether the Secretary of State would like to reflect on the fact that the hon. Member’s first role after being elected was as Boris Johnson’s net zero business champion.
Jonathan Reynolds
Well, I think there is no comment I can make on that.
I would say, first, that I imagine that that business has been doing very well in the last few days—anyone selling ice creams has probably seen a pretty solid demand for their products. The hon. Member makes a really good point, though; there is a lot of support for exporting, and businesses do not always know where to find it. The business growth service, which will be part of the small business plan, is an attempt by Government to bring together a single portal of information—to digitise, with a single digital login ideally, all the interactions that businesses have with the UK state. I want to bring together our considerable export offer, along with the export academy and the expertise that we have in markets, to make things very clear, so that a Member of Parliament like her visiting a business can simply say, “This is where you need to go. This is all the resource available, and I can raise any other issues with the Secretary of State.”
Ruth Jones (Newport West and Islwyn) (Lab)
As chair of the all-party parliamentary group for semiconductors, I welcome the formal recognition of this valuable sector in the new industrial strategy. I also welcome the plans for the future development of the sector, but as always the devil will be in the detail. I look forward to working with the Secretary of State to ensure that the UK semiconductor sector develops to its maximum potential in the next few years, as the essential foundation of so many of our vital industries, like automotive, aviation and cyber-security. Will he commit to regular, ongoing discussions with the leaders of the semiconductor sector?
Jonathan Reynolds
I thank my hon. Friend for her question and for her championing of that sector, which is significant for her constituency. Part of the approach in the industrial strategy is to recognise eight sectors that are very important—those that have an analytical base—and focusing some attention on them, but it covers those foundational sectors as well. As she has said, other sectors would include steel, chemicals, critical minerals, composite materials, electricity networks, ports and construction. We need the foundations in place if we are to have the kind of success that we are looking at, and I look forward to continuing to work with her on that.
Richard Tice (Boston and Skegness) (Reform)
This 138-page industrial strategy highlights the key problem facing British industry: high energy prices. The Secretary of State is putting in place some measures to reduce them, but surely he could do that earlier than 2027 by removing some of the green levies of net stupid zero sooner. When will energy prices come down for all of British industry?
Jonathan Reynolds
I almost thought the hon. Gentleman welcomed part of the strategy there. That took me a little by surprise. Yes, we are going to take decisive actions to reduce the cost of industrial energy prices. As I said earlier, there are some things I can do quicker than others—the supercharger scheme can be made more generous in the short term—but others require a longer process. I will work as hard as I can to deliver that, but I hope he recognises that the core reason why we are such an outlier is our exposure to fossil fuel prices, including gas, for both heating and electricity prices. To be frank, instead of us going down a route where we will be exposed to that in the long term, without the kind of ambition we need to make sure we have secure, clean supplies of energy in the UK, I think the hon. Gentleman should listen to businesses a bit more. They would tell him everything he needs to address this problem.
Louise Jones (North East Derbyshire) (Lab)
Businesses in my constituency are heavily reliant on great connections and making sure that our young people can access the skills they need, so I really welcome this industrial strategy, which recognises the many different aspects that go into supporting our local economy. Can the Secretary of State expand further on what we can do to support better transport connections and a better skills pipeline for the young people in my constituency?
Jonathan Reynolds
I welcome my hon. Friend’s question, which speaks directly to the challenges we are facing. As well as the action on energy bills, we will make sure there is a priority service for businesses to get the grid connections they need—one of the biggest barriers to investment—along with investment in skills. Something that I am particularly excited about is that we are going to spend £41 million to make sure that there is decent wi-fi on every mainline train service by using the latest satellite technology. If I was coming to Parliament just to announce that, I would be quite happy, if I am being honest.
Madam Deputy Speaker (Ms Nusrat Ghani)
Hopefully the rail line that takes me into my constituency will be the first on the list.
Mike Martin (Tunbridge Wells) (LD)
There is much to like in the statement. I particularly like the reduction in energy costs of between 20% and 25%, but I would like to push the Secretary of State a little on that; so that industry can plan, when does he think those 25% reductions are going to happen?
Jonathan Reynolds
Madam Deputy Speaker, my hon. Friend the Minister for Data Protection and Telecoms has just told me that it is £141 million, not £41 million, to put wi-fi on the trains. It has been quite an exciting day, but it is important that I put that on the record.
Energy prices are one of the fundamental parts of the strategy. As I say, the supercharger can be put in place by the financial year 2026-27; the British industrial competitiveness scheme will have to follow a longer process, including a legislative process, so that would happen in the financial year after that. I know how important this is, but once those plans are in place, businesses will have the certainty that that is the cost that they will face, and they can make their business plans and any investment decisions based on that.
Rosie Wrighting (Kettering) (Lab)
I welcome the Government’s ambition to double business investment by 2035, but on the Business and Trade Committee we have heard time and again from businesses that they face barriers in unlocking the investment they need to scale up. Can the Minister set out how the Government intend to support access to scale-up finance so that our economy benefits from our innovation?
Jonathan Reynolds
I thank my hon. Friend for her work on the Business and Trade Committee; I always enjoy my sessions there, as do my ministerial team. She is right that finance is a huge issue and scale-up finance is a particular challenge. We intend to use the British Business Bank, as I have said, with much greater financial capacity to work directly with fund managers focused on the scale-up part of the finance journey. I know how big a problem this is. There is a lot of capital in the world and we have got to address this particular stage, and these are real measures that seek to do that.
Victoria Collins (Harpenden and Berkhamsted) (LD)
I welcome that we finally have an industrial strategy for this country; that is very exciting. On driving innovation, I absolutely support that larger British Business Bank and making sure we invest in scale-ups, although we need to make sure that it is about long-term investment and that there are incentives to de-risk investment. I really want to focus, though, on digital and technology businesses. As much as I welcome training 1 million young people, it is not just about young people. I have businesses like BT, Sage and Xero saying they work with small businesses that need to improve their AI and tech adoption, so what are the Government doing to support them and people of all ages?
Jonathan Reynolds
I thoroughly agree. It is an exciting day and the challenge is long-term consistency and reliability—which, frankly, this Parliament and previous Governments have not supplied. There is a key voice from business to us that we need to address. Digital and tech skills are one of the prominent features of the skills interventions in the industrial strategy in order to do what the hon. Lady says. It is a significant funding package and a significant partnership with businesses, who are telling us they want to work with Government and with young people and that they want to reskill people. I think there is more we can do, but this is the start. I am keen to work with the hon. Lady and any colleague who sees the urgency of this work and the benefits it could bring.
Madam Deputy Speaker
Questions are far too long and the Secretary of State is far too generous with his responses. Let’s try to nip that in the bud.
Jonathan Reynolds
I am tremendously excited by the opportunity my hon. Friend outlines. There are many tools she will recognise in the strategy, including the funding for innovation and for local economic development, and particularly the new strategic sites accelerator—for the first time, land assembly, getting the grid and planning in place—so we have these opportunities for the kind of inward investment offers that we receive. My hon. Friend has a very exciting local proposition, and I am looking forward to working with her on it, but we need more of them.
Carla Denyer (Bristol Central) (Green)
I welcome the investment in skills announced today. What seems to be missing, though, is a commitment to give wraparound support to the 3 million workers in the UK currently in high-carbon industries, who will need reskilling and retraining in order to make the most of the green jobs boom. Can the Secretary of State give us any information on what is planned for those workers specifically, and does he agree that the fossil fuel giants should be the ones shouldering the cost of that support?
Jonathan Reynolds
I thank the hon. Lady for the slightly positive tone of her question. I believe that the skills challenge for the UK is about not just making sure that there are opportunities for young people, but reskilling people too. We have taken forward some interesting measures inherited from the previous Government that will allow us to do it.
I would just say to the hon. Lady that when she condemns people who work in what she calls fossil fuel industries—[Interruption.] Well, perhaps “condemns” is too strong a word, but I ask her to recognise that we have sectors of our own economy that are, relative to other parts of our own economy, high-emissions industries, but on an international basis they are very competitive. It would not be appropriate to simply outsource those emissions to other parts of the world and import those products. There is a lot of Green policy that, frankly, does propose that we do that, but that is not the approach that the Government are taking. We are ambitious about those sectors for the transition and this industrial strategy is key to making it happen.
Pamela Nash (Motherwell, Wishaw and Carluke) (Lab)
I warmly welcome this ambitious and exciting industrial strategy from my right hon. Friend. Aligning vocational and technical training to the skills our industries need is plain common sense. However, in my constituency businesses often tell me that they cannot access the skills and workers they need, and young people and those retraining tell me that they cannot access the courses they need. Has the Department spoken with the Scottish Government in preparation for launching the strategy today?
Jonathan Reynolds
Yes, our officials are in close contact with all our partners in all the devolved Governments. We respect policy differences through devolution, but the kinds of things we are addressing are of interest to every part of the UK.
Max Wilkinson (Cheltenham) (LD)
I congratulate the Business Secretary, the Secretary of State for Science, Innovation and Technology, and the Minister for AI and Digital, the hon. Member for Enfield North (Feryal Clark), on listening to me over the last 11 and a half months and including in the sector plan for digital and technologies the Golden Valley development at west Cheltenham. It will unlock £1 billion-worth of investment in cyber-security and defence, which is crucial to our nation. Will Ministers monitor progress in planning and make sure that if a little extra support is needed to get the infrastructure over the line to deliver that growth, it will happen?
Jonathan Reynolds
I welcome the hon. Gentleman’s support and the contribution his local area can make. In some areas, we have a lot of good things going on, but it needs to happen faster and we have to make sure that we execute the plans we have in place. That sounds like exactly the sort of challenge in this area that we should commit to.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
Ceramics UK has described today’s modern industrial strategy as disappointing and, candidly, I share the sector’s disappointment. The one reference to ceramics in the strategy is historical and geographic, with nothing about industry. For months, I and my hon. Friends the Members for Stoke-on-Trent North (David Williams) and for Stoke-on-Trent South (Dr Gardner) have been pointing out the immediate needs of a sector that employs thousands of people in our city, yet today there is nothing on gas pricing, nothing on electricity pricing and no access to the supercharger scheme. Instead, we are given an IOU for 2027. What message can I take home to those in Stoke-on-Trent this week about what in this industrial strategy will give them the help and the support that they need today, rather than having to wait for an IOU post-dated to the year after next?
Jonathan Reynolds
I say to my hon. Friend that I think Ceramics UK is misplaced in that criticism. Ceramics is recognised as a foundational sector: it is part of the materials foundational sector in the strategy. Its principal request is about energy prices. There are some ceramics businesses—I accept not that many—that get the supercharger and that will get the more generous rate. But fundamentally, the costs of a lot of those businesses do not match the intensity test, which the supercharger is based on—a sectoral and then an individual business test. That is exactly why the British industrial competitiveness scheme has been designed in such a way that they will benefit from it, and that will be a game-changer for them. There are not the same policy tools around gas prices, but of course we can see that gas prices are projected to fall from the very significant level that they have been at for future financial years.
Llinos Medi (Ynys Môn) (PC)
The industrial strategy has a commitment to increase R&D to drive growth. However, Wales has consistently missed out on its population share of UK R&D funding for years, receiving around 2% rather than the 5% we should be receiving. What are the Government doing to ensure that Wales gets its fair share under this strategy, given that research and development is vital for Welsh business to grow?
Jonathan Reynolds
I absolutely recognise that, in all the initiatives we are putting forward today that apply across the UK, every area deserves its fair share of the funding. Of course, many of the policies that I and the Department are responsible for disproportionately benefit Wales. Under the clean steel fund, the money going to Port Talbot is much more than would be allocated to it by population share. That is because there are brilliant strengths in Wales that I want to support. In this strategy —whether around aerospace and Airbus, or automotive and Toyota, or the creative industries, professional and business services, or financial services—there is so much that will benefit Wales because of the brilliant strengths in Wales. That is something to be very optimistic about, and I would be very confident about what this strategy means for Wales, while, of course, respecting the devolution settlement.
Tim Roca (Macclesfield) (Lab)
I congratulate my right hon. Friend. With over 5,000 Macclesfield jobs dependent on AstraZeneca, I welcome the health data research centre, the slashing of trial times and the focus on life sciences. Will he set out how he is supporting Department of Health and Social Care colleagues to further deliver for life sciences by finalising a realistic settlement on the commercial agreement over the pricing of medicine, and VPAG—the voluntary scheme for branded medicines pricing, access and growth—in particular, as that is very important to my constituents?
Jonathan Reynolds
I welcome my hon. Friend’s question; he is right that VPAG is significant to the life sciences sector plan and that the industry is looking for resolution on it. The life sciences sector plan will be formally launched by Cabinet colleagues to coincide with the anniversary of the foundation of the NHS. Talks with industry are ongoing and we are trying to find a settlement, which I believe is possible. We should all recognise the economic benefits of the sector for his constituency, which he carefully outlined.
Tom Gordon (Harrogate and Knaresborough) (LD)
I welcome the industrial strategy, but I want to push the Secretary of State on skills. Harrogate college often tells me that it struggles to access funding for technical and vocational training that meets the needs of local business. In the next academic year—in just a couple of months—it will face a £90,000 reduction in the devolved adult skills budget from the new Labour mayor. Will the Secretary of State clarify how the skills mission fund will work in practice for towns like mine, and whether it will be genuinely led by local economic need, not Westminster targets?
Jonathan Reynolds
I recognise the case that the hon. Gentleman makes. Some of the courses that we need and that are central to our economy—engineering is a good example—are more expensive to put on and need greater capacity. When I talk about a funding package, it is to deliver the business-led, needs-led courses to which he refers, and I would expect Harrogate college to feel the benefits of that.
Paul Waugh (Rochdale) (Lab/Co-op)
Rochdale Training provides local apprenticeships in engineering and other skills that we desperately need, and works with local employers to deliver that. Its chief executive, Jill Nagy, told me that today’s announcement of £1.2 billion in extra funding for training is warmly welcomed, as are the new foundation apprenticeships. Will the Secretary of State join me in praising the work of Rochdale Training? May I urge him to look closely at Hopwood Hall college’s bid to be one of the north-west’s technical colleges of excellence for construction?
Jonathan Reynolds
Further education has had a difficult time over the past few years and we are starting to see the kind of investment that will make a difference. We need more business input into skills’ policy, which I think is the kind of work that my hon. Friend was talking about. I am more than happy to come up the road from Stalybridge to Rochdale one Friday, and we can have that conversation in person. There will be many bids from Greater Manchester for the capital that we are putting forward, and I look forward to looking at the bid that he mentions.
David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)
I commend the Government on reintroducing an industrial strategy, which is crucial for spreading out good jobs across the United Kingdom. In my constituency, the hospitality industry is crucial to our local economy as it boosts tourism, creates jobs and helps with rural regeneration, but it is struggling with sky-high energy costs. What is the Secretary of State doing to ensure that SMEs in all sectors of our economy, particularly pubs and restaurants, receive better support with their energy costs?
Jonathan Reynolds
This industrial strategy seeks to deliver more inward investment. For example, Universal is making an incredible investment in Bedfordshire, where is seeks to deliver the biggest theme park in Europe, creating 8,000 jobs in hospitality. People should recognise that there is a direct relationship between what we are doing here, what we are trying to get more of and the kind of benefits that the hon. Gentleman talks about. We have set a target of 50 million visitors by 2030, so such issues are represented in the strategy and, as I say, some of the issues that are not covered will be in the small business plan, which will come out imminently next month.
Noah Law (St Austell and Newquay) (Lab)
As the chair of the all-party parliamentary group on critical minerals, I have an interest that I know you share, Madam Deputy Speaker, in critical minerals. I welcome the strategy’s recognition of the role that regional clusters, like that in Cornwall, can play. Given Cornwall’s resurgent critical minerals ecosystem, what steps is the Secretary of State taking to ensure that the region is at the forefront of secure domestic supply chains, and that we benefit directly from that growth in green industrial jobs?
Jonathan Reynolds
That is a great question. I remember our conversations about critical minerals, Madam Deputy Speaker. They are a key enabler and they will be even more important in the future. My hon. Friend will know that some of the National Wealth Fund’s initial investments have been into different critical minerals businesses in his region, because of the importance of that part of the UK to this strategy. We need more international co-operation on critical minerals as well, but he should rest assured that the British Business Bank and the National Wealth Fund are focused on this area because it is so important, and there will be big benefits to his area from that.
Samantha Niblett (South Derbyshire) (Lab)
As the founder of Labour: Women in Tech, I wholeheartedly welcome the industrial strategy’s ambitious goals to scale our tech sector and workforce. On 15 July in Parliament, I am hosting WeAreTechWomen and Oliver Wyman for the launch of the Lovelace report. The report has identified that between 40,000 and 60,000 female professionals are leaving the tech sector annually or seeking advancement opportunities elsewhere, which represents well over £1 billion of economic opportunity that could be unlocked by better supporting our existing skilled workforce. Does the Secretary of State agree that both inspiring new talent and supporting great existing talent and diverse teams, across all demographics, is fundamental to maximising returns on our industrial strategy investments and securing the UK’s position as a world-leading technology nation?
Jonathan Reynolds
I thoroughly agree with my hon. Friend. It is brilliant to see her in Parliament as she has been a trailblazer on these issues, and I recognise the case that she has put forward extremely well. I recognise that this is a core economic priority for the United Kingdom, and it is great to see her as an advocate for that on the Government Benches.
Tom Hayes (Bournemouth East) (Lab)
The CBI says that our net zero economy grew by 9% in 2023, and that it was 40% more productive and wages in the sector were 15% higher than the UK average, so I am pleased to say that this industrial strategy is betting on a winner with clean energy. I am also pleased to hear the announcement that the Government will be slashing the cost of energy for industry, but will the Secretary of State tell me, my constituents in Bournemouth and people across the south-west what the industrial strategy will do for the south-west?
Jonathan Reynolds
I am more than happy to tell my hon. Friend. We have breakdowns for every region going to every colleague; there is so much for each part of the UK that I could not possibly do it justice from the Dispatch Box. On his point about clean energy, there is so much money coming into the UK—and more in future—that it would be crazy to turn our backs on that. This is a major economic opportunity, as well as being about a safe, reliable, clean supply of energy for the UK, which is the basis of all economic activity. We can provide that while reducing energy bills for industry, so that is exactly the kind of consistent approach that this country has needed for some time.
Madam Deputy Speaker
With my apologies for not calling him earlier, I now call Jim Shannon.
Jim Shannon
You are very kind, Madam Deputy Speaker—we got there in the end.
I thank the Secretary of State for his statement, which is full of positivity. Everyone here welcomes it deep down, and if they do not, then they should: well done, Minister, and well done this Government. While I welcome the news that more than 7,000 British businesses are set to see their electricity bills slashed by up to 25% by 2027, it is clear that much more support is needed, such as a reduction in corporation tax, especially for businesses in Northern Ireland, which borders the Republic of Ireland where the corporation tax rate is half of our rate at 12.5%. Will the Secretary of State discuss that with his Cabinet colleagues in order to provide greater support for our industries in Northern Ireland?
Jonathan Reynolds
I appreciate the hon. Gentleman’s support and kind words. There is a great deal in the strategy that will benefit every part of the UK. He knows that I take my responsibilities for Northern Ireland very seriously, particularly given the complexities of trade policy, the Windsor agreement and how that has to work for the benefit of everyone in Northern Ireland. He will know that the UK has the lowest corporation tax of any G7 country, so it is quite an ask to reduce it still further. However, I understand the genuine competitive pressures of being in business in Northern Ireland for people who are close to the border, and how they are affected by the mobility of capital and talent. We all have a responsibility to work with our colleagues in the Northern Ireland Executive to ensure UK Government policy works to the maximum, and provides consistent and co-ordinated benefits. I am regularly in touch with my colleagues in Northern Ireland and regularly visit. I am planning a visit right now—I might even look up the hon. Gentleman and make a visit to his constituency to address some of these issues.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I welcome the focus in this industrial strategy on the Tees Valley region and, in particular, our clean energy sector, which represents some 8,800 jobs today and will scale up dramatically into the future. As I said in September, this will only work if we have alignment on skills. When do we expect to see the clean energy workforce strategy? What steps will the Government take to align skills into the future?
Jonathan Reynolds
It is important for colleagues to understand that the modern industrial strategy published today provides a tool through which other non-economic Government Departments can filter their own policy decisions, in a way that is consistent and to the benefit of UK business. For instance, the Home Office will publish its exemptions to the more restrictive skilled worker visa in relation to what the sectors set out in the strategy need and, for the first time, decisions will be made through that lens. My hon. Friend mentions a specific piece of work by colleagues in the Department for Energy Security and Net Zero on the workforce strategy, to which they are committed. I do not have a timescale for that, so I will ensure that I or colleagues write to him about it. The prize here is genuinely joined-up Government. To be frank, the preparation of the strategy has not always been easy, but it is the kind of consistent approach to policy, competition and competitiveness in the UK that is very important.
Joani Reid (East Kilbride and Strathaven) (Lab)
I welcome this ambitious industrial strategy and commend the Secretary of State on the long-term thinking, which is something we did not see under the previous Government. East Kilbride in my constituency, Scotland’s first new town, was born out of an effective post-war industrial strategy, but over recent years my constituents have been given false hope by both the SNP and Tory Governments, with big promises and little delivery. Will the Secretary of State give my constituents reassurance that this time, the strategy will deliver and we will get growth and jobs?
Jonathan Reynolds
I will be frank with my hon. Friend’s constituents. In the past, Governments have produced documents that do not have much longevity but have a lot of analysis without necessarily having real measures behind them. That is why we have launched this strategy on energy, finance and skills, on the powers that local areas need and how those programmes will work consistently across Government. This is always about creating the conditions for the private sector to thrive in, but anyone looking at the big challenges facing UK industry will see them addressed in this document.
Catherine Atkinson (Derby North) (Lab)
Worryingly, only 9% of secondary vocational learners are studying engineering, manufacturing and construction compared with the OECD average of 32%, so I warmly welcome that this industrial strategy confirms a £100 million investment to support engineering skills in England. Will the Secretary of State outline how that funding will help to meet skills shortages and deliver growth across the country, including in engineering cities such as Derby?
Jonathan Reynolds
Derby has an incredible pedigree in engineering skills. I agree with the case that my hon. Friend has made so strongly. I have added some funding from my own Department to that from the Department for Education around engineering, because the shortages are so acute and the opportunities so great. These are great jobs, careers and lives for young people or anyone transferring into that sector, with more funding for the courses, more flexibility in the courses that can be run and more capacity in technical excellence colleges. Although it is also about availability in all parts of the country, we could not get a better pedigree than my hon. Friend has in Derby, which is a great success story for this country and for her local area.
Amanda Martin (Portsmouth North) (Lab)
I warmly welcome the comprehensive and business-friendly UK modern industrial strategy; it is an investment in Britain, British people and British businesses. As home to the world-class and innovative defence cluster, Portsmouth has strength in maritime, space, drones, autonomous systems and assets such as QinetiQ, Airbus, His Majesty’s Royal Navy base, Griffon Marine, Portsmouth Aviation and Solent freeport. I could continue the list with many more brilliant businesses in my city, but time does not allow. Will my right hon. Friend say how “Invest 2035” can work alongside future devolution and local government reorganisation to help unlock growth, investment, skills and jobs for Portsmouth businesses and residents?
Jonathan Reynolds
It is very important that we show the British people that the added investment and huge increase in defence spending from this Government will see real economic benefits for them and opportunities for their families, as well as fulfilling the core function of national security. My hon. Friend mentions devolution. We have measures in the strategy for local areas, whether or not they have mayoral leads on innovation and mayoral growth funds, many of which build on the very successful work of Andy Burnham, my Labour mayor in Greater Manchester, and Richard Parker in the west midlands, who have done brilliant things. Those are the most developed and mature mayoral areas. We can see what has worked in those places, and it really is starting to work. Let us have more of that across every bit of the UK, tailored for local needs and with the right tools that those political leaders need.
Alan Strickland (Newton Aycliffe and Spennymoor) (Lab)
I welcome this incredibly ambitious industrial strategy. I will ask specifically about our high-tech SMEs. At NETPark in Sedgefield, we have a cluster of more than 40 businesses making satellite components, medical imaging equipment and other high-tech products. However, as the Secretary of State knows, too often they struggle to get private finance, and they have struggled in the past to get Government innovation funding. How will this strategy really put the rocket boosters behind high-tech SMEs in regions such as the north-east?
Jonathan Reynolds
I always take a close interest in success stories from the north-east of England, and what my hon. Friend outlines is incredibly exciting. The high-tech SME cluster that he talks about will benefit in many ways from each of the sector plans, whether they are in advanced manufacturing, creative industries or defence. There are provisions on access to finance for them in this strategy and the dedication of resources from the defence budget, for instance, for that sector. Those businesses are set to fly, and with this industrial strategy my hon. Friend has a real chance to build and communicate the opportunities for them over the next few years.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
I really warmly welcome the modern industrial strategy, particularly all that it has to offer for Scotland. I also welcome the Business Secretary’s personal enthusiasm and energy about the potential for growth in Scotland—what a contrast with the SNP, which cannot help but talk Scotland down. I particularly welcome the good news for skills and innovation, which will benefit Scotland, and for reduced energy costs, particularly electricity costs, for our key manufacturing sites in Scotland. As I have discussed with my right hon. Friend, the ethylene plant at Mossmorran is a large employer in my constituency, supporting hundreds of high-skilled, well-paid jobs in Fife. Will the Business Secretary outline how this industrial strategy and other Government action will back the chemicals industry and the jobs it supports?
Jonathan Reynolds
I think it was about a year ago when my hon. Friend and I were on the campaign trail in her constituency and visited businesses with the message that we would implement a strategy of this kind. I think that the Scottish economy, when mapped against our eight industrial strategy sectors, could be a description of Scottish success, and we should be excited about that. The ethylene cracker at Mossmorran is a very important facility. As my hon. Friend will know, high gas prices across Europe mean that all the crackers across Europe are under some degree of distress. I have been in conversations with my right hon. Friend the Secretary of State for Scotland about that and other crackers in Scotland that are affected by those high gas prices, and we continue that work. More generally, the chemicals sector is recognised as a key foundational sector in this strategy. It has had a lot of pressure in recent years, and we are seeking to improve that business environment.
Lola McEvoy (Darlington) (Lab)
This is mint for British industry. In my region, we have a proud history of making world-class products and exports. We make trains, and this Government have secured the future of Hitachi at Aycliffe. We make cars, and this Government have negotiated a tariff deal to protect the Nissan plant in Sunderland. We make hugely advanced bioindustry products, such as the covid-19 vaccine, at the Centre for Process Innovation in my constituency in Darlington. As the chair of the APPG on industrial strategy, I know that the finance solutions and energy subsidies will be roundly welcomed by business up and down the country. Will the Secretary of State outline how this strategy will lead to more highly paid, highly skilled job opportunities for workers in constituencies such as mine who have seen more plants shut than saved over the last 14 years?
Jonathan Reynolds
I thoroughly thank my hon. Friend for her question and for all her work in her role in Parliament advocating for these issues. There is a huge amount in this strategy for the sectors that she outlines. I was very proud of the work that we did with Hitachi. On cars, it is about the tariffs, the Drive 35 programme, energy costs and the ZEV mandate, and we will make any changes that we need for a competitive position. This is fundamentally about what business needs, but it is also about better-paying jobs in every part of the UK. My hon. Friend’s part of the world in particular will stand to benefit considerably from this programme.
Alex Baker (Aldershot) (Lab)
I congratulate the Secretary of State on the ambition of this industrial strategy and invite him to visit Cody technology park in Farnborough, which is home to world-class defence and aerospace innovation, from QinetiQ’s development of DragonFire to one of only two commercial wind tunnels in the world. What role does he see for places such as Cody, which are already contributing but have the potential to do even more to help to create jobs and fire up our industrial base?
Jonathan Reynolds
It is brilliant to hear from my hon. Friend; she has so much to be proud of in her constituency. I have visited Farnborough on several occasions, and it has a range of things that are directly represented in this strategy. I also thank her for being a huge ally on the work that we have done on access to finance for the defence sector, which has been an important message for us to send out about national security and the huge economic opportunities that rightly should come from the increase in defence spending that this Government have committed to already.
Sarah Coombes (West Bromwich) (Lab)
The Black Country has been an industrial powerhouse for hundreds of years; it is famous for making everything from the glass in the White House to the Big Ben clocktower and the chemical odorant that people will smell when they turn on the gas hob. Will the Secretary of State set out how this 10-year plan for industry will support Black Country manufacturing businesses with lower energy prices and upskill the next generation of people for these highly skilled, well-paid jobs? Would he like to visit one of my brilliant businesses in West Bromwich?
Jonathan Reynolds
I certainly would love to visit—I am happy to commit to that. I am surprised that my hon. Friend did not claim her constituency to be the birthplace of the industrial revolution, because I think a few colleagues have gone there, and she has a claim to it as well. Whether it is funding for lower energy costs, skills in the pipeline for young people, access to finance, a regulatory environment that fosters growth or expanding Made Smarter, which is a fantastic programme that we will have more of, there is so much in this strategy that will make a difference to her area. Perhaps we will go and visit some businesses together and take that message to them.
Dr Allison Gardner (Stoke-on-Trent South) (Lab)
The industrial strategy rightly recognises the role of ceramics as a key foundational industry and, of course, the central role of Stoke-on-Trent not just historically but in the exciting new world of advanced ceramics—providing parts for wind turbines and even small modular reactors, if we get the investment our way. As the Secretary of State has mentioned, ceramics has the additional challenge of being a gas-intensive industry. As such, I welcome the Government’s commitment to the energy-intensive industries compensation scheme—a snappier name would be nicer—particularly in supporting decarbonisation and technological innovation. May I ask the Secretary of State what specific support is planned to aid the ceramics industry, not only in managing its energy costs but in supporting its decarbonisation?
Jonathan Reynolds
I thank my hon. Friend for her question. She has already heard me outline the eligibility, and the foundational role that ceramics plays in the strategy and the support it can receive. She is also right that we have committed to the energy-intensive industries compensation scheme review that the industry wanted. We should all recognise that the ceramics sector faces more challenges with decarbonisation than some other sectors, and we have to be a supportive partner in that, particularly by recognising some of the technological limitations that currently exist. As I said in answer to a previous question, we have to look at where we are—perhaps we have higher emissions from a sector, but where is that sector internationally? Would it be in our interest to see those emissions exported abroad and emissions as a whole go up? I do not think it would. That is the approach I will always take to the ceramics sector or any other sector to ensure that we are doing the right thing, both for the climate and for British jobs and British industry.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Jacob Collier. [Interruption.] I call Scott Arthur.
Dr Scott Arthur (Edinburgh South West) (Lab)
Thank you, Madam Deputy Speaker. The hon. Member and I must look alike.
I refer Members to my entry in the Register of Members’ Financial Interests. Not that long ago, we had a Scottish Government in which some Cabinet members did not even believe in economic growth, so the contrast with what we have heard today could not be starker. There are 16 mentions of Scotland’s capital city in the industrial strategy, and a key one for Edinburgh South West is Heriot-Watt University’s national robotarium—the birthplace of robotics, as far as I am concerned—but it would be interesting to understand where the Secretary of State thinks universities fit into the industrial strategy, given the pressures that they face in England and the many universities in crisis in Scotland.
Jonathan Reynolds
My hon. Friend raises some very important and serious questions. Universities play a huge role in innovation and are a vital part of the clusters we are creating, but in themselves, they are something of which we should be incredibly proud. We have a world-class university sector, and every parliamentarian should be prouder of that. I do not have time to go into the detail that I would like, but universities are at the heart of our approach to innovation and economic success across the UK.
Jacob Collier (Burton and Uttoxeter) (Lab)
My constituency boasts some of the nation’s most energy-intensive industries, from manufacturing to being the home of UK brewing. As such, I welcome the news that there will be energy subsidies for energy-intensive industries, which will support those industries and local jobs in my constituency. Can the Secretary of State say more about how he will work across Government to ensure that manufacturers and brewers will not be paying champagne prices for power?
Jonathan Reynolds
I recognise that there are some regulatory issues that my hon. Friend was probably asking about, particularly in relation to the lead that the Department for Environment, Food and Rural Affairs would have on extended producer responsibility and some other aspects. I am always keen to work with colleagues across Government, and I will ensure that my hon. Friend gets the answers to his questions that he needs, but he is right to say that there are many opportunities for businesses—big and small—and for his constituents in this plan.
Tom Collins (Worcester) (Lab)
As an engineer, I am incredibly excited by the vision of engineering, industrial and innovation renewal that the Secretary of State is describing. In Worcester, we have a mission to make ourselves the best city in the best country in the world to start and grow a business. Time and again, though, the funds and research facilities intended to support innovation have not worked for our local businesses, and there has been a lack of support for mid-technology readiness level technologies. How will this strategy help businesses across the country to bridge the valley of death and grow in this decade of renewal?
Jonathan Reynolds
I thank my hon. Friend for his question, which I greatly appreciate. Worcester plays a wonderful role in our economy, and it is great to hear about that level of local ambition from him and other local leaders. There are specific funds to support innovation: £500 million has been allocated for innovation, which will be split among areas up and down the country. The access to finance provisions will also apply to his constituency, whether that is the British Business Bank having more firepower and more ability to support the kind of items that he has in his constituency, the beefed-up capacity for UK export finance, or the National Wealth Fund working hand in hand with the private sector. The brilliance that my hon. Friend has in Worcester is exactly the kind of platform that stands to benefit greatly from the measures in the industrial strategy.
UK-US Economic Prosperity Deal
Jonathan Reynolds Excerpts(1 month, 2 weeks ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
On 8 May 2025, the Prime Minister and the President concluded a landmark economic deal between the United Kingdom and the United States. The deal was defined in the general terms for the economic prosperity deal. Both countries agreed to begin negotiations on the EPD immediately, to develop and formalise the proposals in the general terms. The Government remain relentlessly focused on securing the best outcomes for UK industry, and ensuring that businesses up and down the country can feel the benefits of the deal as soon as possible.
On 16 June, the Prime Minister and the President agreed further progress towards that goal.
As outlined in paragraph 1(c)(i) of the general terms, the US will create a 100,000-unit quota for all UK car exports to the US, reducing US tariffs from 27.5% to 10%. This will be administered on a quarterly basis. This has been signed by the President through Executive order, and we expect that these arrangements will come into force by the end of the month. This 10% tariff will also apply to UK part exports attendant to finished passenger cars that UK manufacturers export to the US.
The UK will implement its commitments in paragraph 1(b) of the general terms relating to beef. We will execute the legislative process to create a preferential duty-free quota for US beef of 13,000 metric tonnes (mt) per calendar year. Alongside this, the UK will remove the 20% tariff on US beef imports under the existing World Trade Organisation quota shared between the US and Canada of 1,000 mt per year. The UK will lay legislation in Parliament to bring the quota into effect. Under paragraph 1(b) of the general terms, the United States confirmed its commitment to reallocate to the United Kingdom 13,000 mt of its existing “other countries” tariff rate quota for beef at most favoured nation rates. That re-allocation will take place as quickly as possible and at the latest by 1 January 2026. As confirmed in the general terms, the United Kingdom and the United States affirm that imported food and agricultural goods must comply with the importing country’s sanitary and phytosanitary standards and other mutually agreed standards. Paragraph 2(a) of the general terms outlines how the UK and the US will seek to strengthen bilateral agricultural trade.
The UK will also execute the legislative process to create a preferential duty-free quota for US ethanol of 1.4 billion litres per year. The UK will lay legislation in Parliament to bring the quota into effect.
The US and UK will continue to work together at pace to implement paragraph 1(a) of the general terms, covering other tariffs. The US and the UK will continue to work together to conclude this negotiation and implement reductions as soon as possible. Each country intends to continue to improve market access under the EPD.
The US and the UK will take forward the remaining provisions contained in paragraph 1(c) of the general terms. The UK and US are conducting rapid discussions to create a quota at most favoured nation rates for the export of steel, aluminium and certain derivative products from the UK to the US, and intend to finalise implementation as soon as possible.
The US commits to reducing tariffs on imports of aerospace goods from the UK from current levels back to MFN rates. This has been signed by the President through Executive order, and we expect these arrangements to come into force by the end of the month.
Both countries remain focused on securing significantly preferential outcomes for the export of pharmaceutical products from the UK to the US and other sectors that may be subject to section 232 investigations or other tariff measures.
[HCWS709]
Oral Answers to Questions
Jonathan Reynolds Excerpts(1 month, 3 weeks ago)
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The Secretary of State for Business and Trade (Jonathan Reynolds)
This trade agreement is a huge economic win for the UK—the biggest trade deal since Brexit and the best deal that India has ever offered. As we have heard, it is estimated to increase bilateral trade by £25.5 billion, UK GDP by £4.8 billion and wages by £2.2 billion each year in the long run. It will mean new opportunities for businesses in every part of the United Kingdom.
Alan Gemmell
I draw the House’s attention to my entry in the Register of Members’ Financial Interests. I am having some import-export issues myself, as my first book, a provocative and racy thriller, is being published in India in July.
Alan Gemmell
It is called “30th State”.
May I congratulate the Secretary of State and former colleagues on this deal, which is great for whisky distilleries such as Lochlea in my constituency. When I was trade commissioner, Conservative Ministers were clamouring for a trade deal with India. Will my right hon. Friend tell the House how he has managed to do it one year after they failed miserably?
Jonathan Reynolds
I am extremely grateful for that question. I acknowledge my hon. Friend’s considerable expertise and service to this country through his commendable work as trade commissioner. I hope that he will advise us all on how to get a copy of his book—perhaps a copy could be placed in the Library. He is right to say that this is a great deal for every part of the UK. It is particularly strong for Scotland, given the iconic reduction in the tariff on Scotch whisky for the Lochlea distillery, and it is strong on Scottish salmon and services. These deals come down to a lot of work not just from the ministerial team but from the whole departmental team. I pay tribute to them and my officials for all their important work in this matter.
Gurinder Singh Josan
Last week I had the privilege of visiting A&M Pure Precision, a long-established local firm in my Smethwick constituency that specialises in designing, developing, testing and machining complex precision components in a range of materials for sectors including aerospace, automotive, motorsport, space and unmanned aerial vehicle engine systems. Given the importance of advanced manufacturing to the local economy, what assessment has the Secretary of State made of how the UK-India free trade agreement—and indeed other agreements—could create new opportunity for such firms and support wider economic growth in the west midlands?
Jonathan Reynolds
What a privilege it must be for my hon. Friend to represent a constituency with so many essential businesses doing such brilliant work for this country. On advanced manufacturing, he is right to say that a set of advantageous positions has been agreed, putting this country at a genuine competitive advantage, particularly in relation to sectors such as automotive and machinery, which I would expect his constituency to benefit from. India is traditionally a very protectionist economy, and it is the world’s fastest growing big economy. Whether it is for goods or services, A&M Pure Precision or the west midlands as a whole, there is so much good stuff here to celebrate.
Jim Shannon (Strangford) (DUP)
The Minister can expect an autographed copy of the book by the hon. Member for Central Ayrshire (Alan Gemmell) to be spinning its way towards his office as we speak.
I very much welcome the UK-India free trade agreement. It is good news, but Northern Ireland has a particular protocol issue. I know that the Minister is keen— I know it for a fact, because his answers are always good—that Northern Ireland can receive the same benefits as the rest of the United Kingdom: England, Scotland and Wales. Can he assure us that we in Northern Ireland will also be benefactors?
Jonathan Reynolds
I appreciate the hon. Member’s kind words. He will know that ensuring that everything my Department does works for Northern Ireland is a personal priority for me and for the ministerial team. In relation to exports, I can assure him that Northern Ireland will benefit from the advantageous position that the whole United Kingdom is in. We do have issues in making sure the more complex regulatory position from the protocol in Northern Ireland is working in the best possible way. There are very strong reasons for making that work better, if we can do so, and he has my commitment that we will seek to do that.
Mr Richard Quigley (Isle of Wight West) (Lab)
Laura Kyrke-Smith (Aylesbury) (Lab)
The Secretary of State for Business and Trade (Jonathan Reynolds)
Since our last oral question time, we have secured three major trade agreements to boost British exports and drive growth across the UK. This Government are delivering trade deals that benefit businesses and put money in workers’ pockets, and are securing deals that other Governments promised, but failed to deliver. We have an agreement with our largest trading partner, with the biggest economy in the world, and with the fastest-growing big economy in the world. As we have heard, the India deal alone will boost wages by £2.2 billion a year when fully operational. Our new strategic partnership with the EU could add nearly £9 billion to our economy by 2040, and the UK was of course the first country to secure a deal with President Trump. I can also confirm that in the past week, we have hosted delegations from the US and China, in order to assist them in their negotiations with each other. As I have always said, under this Government, the UK will be the most open and best-connected economy in the world.
Laura Kyrke-Smith
I congratulate the Secretary of State on his excellent work. The Government’s decision to suspend their trade negotiations with the Israeli Government last month was absolutely the right one, but some constituents have been in touch in confusion after trade envoy Ian Austin’s visit still went ahead. Can the Secretary of State affirm that this Government’s position is that we will not be deepening our trade ties with the Israeli Government while the situation in Gaza and the west bank remains so appalling?
Jonathan Reynolds
I am grateful to my hon. Friend for that question. Yes, I can reaffirm that position. As she says, the Foreign Secretary announced on 20 May that we have suspended negotiations on an upgraded free trade agreement with Israel in response to the egregious actions of the Netanyahu Government in Gaza and the west bank. Of course, the UK has existing business relationships with Israel that are not affected by that decision, and we maintain trade envoys with both Israel and the Palestinian territories. What we all want is peace, a two-state solution and a strong UK relationship with both states.
Graham Stuart (Beverley and Holderness) (Con)
Jonathan Reynolds
I understand the prominence of the issue in the right hon. Member’s constituency. We already import a significant amount of ethanol from the US: 860,000 tonnes of bioethanol. We recognise the competitive pressures that the US trade deal will bring—it is obviously not yet in operation—and have met the companies affected and continue to negotiate with them. They are already very distressed and lose significant amounts of money, so what they really need are regulatory changes from the Department for Transport for the market as a whole. I can assure him that we are working on that.
Chris Bloore (Redditch) (Lab)
Jonathan Reynolds
I absolutely accept that invitation, and I can tell the hon. Gentleman that we are already extremely involved, as is the Minister for Industry. We welcome what has happened with Airbus, but we are focusing a great deal on the RemainCo and the issues there.
Olivia Bailey (Reading West and Mid Berkshire) (Lab)
Last year, the Secretary of State joined me on a visit to our vibrant high street in Pangbourne. I recently met the owner of one of those businesses, Nino’s, a fantastic trattoria and deli. One issue that Nino raised with me was the regulatory burden on his business. How will the Government’s small business strategy deal with that key challenge, and how will it support small businesses like Nino’s, so that they can continue to thrive?
Jonathan Reynolds
We had a wonderful visit about a year ago, and I hope the Pangbourne Cheese Shop is still going strong. Yes, the regulatory burden on small business is a huge area of attention for this Department; there is the business growth service, our action on late payment, and our incentivising of digitisation and e-invoicing.
Andrew George (St Ives) (LD)
Our farmers and growers can survive only if there is a functioning supply chain, but since the creation of the Groceries Code Adjudicator, they complain bitterly about continuing poor practice and the risk of de-listing. Does the Minister not agree that it is time to beef up this organisation, and to amalgamate it with the Agricultural Supply Chain Adjudicator?
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
I very much welcome yesterday’s investment in UK energy abundance, but as our Committee pointed out on Friday, the success of the industrial strategy will depend on a plan to cut industrial energy costs now. When the industrial strategy is published, will the Secretary of State reassure us that there will be a plan to ensure that UK energy prices are internationally competitive?
Jonathan Reynolds
I thank my right hon. Friend and the Select Committee for all their work in this area. He knows my view from the evidence that I have given. The significant increase in industrial energy prices under the previous Government is a significant issue for our competitiveness—and yes, that is something that we seek to address.
John Cooper (Dumfries and Galloway) (Con)
When it comes to bus manufacturer Alexander Dennis and the jobs at risk there, there is not an elephant in the room—there is a Chinese dragon. The company is in competition not with commercial organisations from China, but with entities of the Chinese state. What representations will the Secretary of State make to the Prime Minister in an attempt to level a playing field that is currently about as flat as the Galloway hills?
Jonathan Reynolds
I firmly agree with the hon. Gentleman that a level playing field is not just an economic necessity, but a matter of economic security and production in western economies like our own. Of course, if a company has a specific case to make, it should make the representation to the Trade Remedies Authority directly—I have that power, but it would usually come from industry. If the company has a specific case to make, the hon. Gentleman should encourage it to make that representation.
Dr Marie Tidball (Penistone and Stocksbridge) (Lab)
It was fantastic to hear the Government’s commitment yesterday to making the UK a defence industrial superpower. At its peak, Stocksbridge Speciality Steels, in my constituency, produced 15% of global defence and aerospace steel, which is essential to our national security. What work is the Secretary of State doing to secure Stocksbridge Speciality Steels so that this valuable steel asset can be used to maintain our national security?
Jonathan Reynolds
My hon. Friend knows that I believe the workers at that mill in her constituency are a national asset and that I want them to have a strong future as part of our overall steel strategy. We are closely monitoring the specific situation there, which colleagues will be aware of, and are determined to find the outcome that she and I would want to see.
Chris Law (Dundee Central) (SNP)
The Prime Minister routinely states his unwavering support for Ukraine, yet as a result of UK Government inaction, British businesses continue to bankroll Putin’s brutal war on a colossal scale. Since the beginning of Russia’s full-scale invasion in 2022, a whopping £205 billion of Russian fossil fuel exports have been shipped by our own UK-based maritime companies or by ships with our own UK-issued insurance. Astonishingly, one company, Seapeak, has carried almost a quarter of Russia’s liquefied natural gas exports. Can the Secretary of State give us an update on what the Government are doing, and deal with this immediately?
Jonathan Reynolds
I am concerned by the figures the hon. Gentleman raises; if he writes to me, I will look into that immediately. We have taken extensive action to sanction not just individuals, but the shadow fleet, as it is described, transporting Russian fossil fuels, and are willing to take any action necessary.
Kirith Entwistle (Bolton North East) (Lab)
Yesterday, the Dad Shift campaign organised hundreds of dads to come to Parliament to campaign for better paternity leave. Does the Secretary of State agree that better paternity leave can give dads more security to spend more time with their babies, support the development of children and help gender balance in the workplace? Will he tell the House whether the issue will be covered in the upcoming parental leave review?
Joe Robertson (Isle of Wight East) (Con)
The chief executive of UKHospitality estimates that there will be an extra £1 billion of costs on employers for new workers—774,000 of them—coming in to the national insurance contributions regime, on top of £2.4 billion in other costs. If, by the next Budget, it turns out that the previous Budget is crushing the hospitality sector, will the Government consider tax reliefs in order to power our hospitality industry?
Jonathan Reynolds
The hon. Gentleman knows the Government, and the Treasury in particular, monitor the impact of all taxation. I have to be frank with colleagues: I have no idea what the Conservatives are trying to tell us today. They seem to want more spending and lower taxes—it seems like Liz Truss is still hanging around the party, to be honest. I have to ask Members on the Opposition Benches: what is your policy towards national insurance?
Torcuil Crichton (Na h-Eileanan an Iar) (Lab)
I welcome the UK-India trade deal, which is good for salmon and good for whisky. Will the Secretary of State use his muscle to ensure that a chain of small distilleries in my constituency and across Scotland can sell a wee dram to India, as well as the big brands?
Mr Speaker, I would like to draw the House’s attention to reports of a crash on take-off of a London-bound Air India flight from India today, and allow the Secretary of State to express our concern.
Mr Speaker
It is very important, and I think the Leader of the House will make reference to it when we get to business questions—if we get there.
Jonathan Reynolds
I am extremely grateful to my hon. Friend for updating the House on that matter. He will know that one of the brilliant things about the UK-India deal is that it is not just for the higher-value, iconic products we are all familiar with; for bulk, there is no minimum price in the deal. The deal is incredibly strong for every bit of the whisky—and gin—industry in the United Kingdom.
I am alert to the news my hon. Friend has just shared, and colleagues will update the House.
Martin Vickers (Brigg and Immingham) (Con)
Greenergy, a company based in Immingham, has been forced to shut down and review some of its operations in the UK. In part, that is due to an influx of heavily subsidised hydro-treated vegetable oil from the US. Will the Secretary of State bear this in mind when he has trade negotiations with the US with a view to easing the situation?
Jonathan Reynolds
I shall of course take that up with the hon. Member. I have spent a fair bit of time in his constituency, as he knows, on one matter or another. On fair trade and level playing fields, colleagues can direct their industries to the Trade Remedies Authority if they have specific concerns, but, of course, we monitor those matters at a departmental level as well.
Sonia Kumar (Dudley) (Lab)
Since the global financial crisis, listing on the London Stock Exchange has fallen by 40%, posing a significant barrier to growth, as liquidity and investor activity decline. What steps is my right hon. Friend taking to ensure that more British businesses are listed on the London Stock Exchange and that the UK remains a leading global financial sector?
Jonathan Reynolds
That is an area of concern to us all. We support and continue to implement some of the listing rules and prospective changes of the previous Government, but the bigger change from this Government is to liquidity, particularly around pensions reforms. None the less, this remains an issue of key competitiveness for the United Kingdom.
US-UK Trade Deal: Northern Ireland
Jonathan Reynolds Excerpts(2 months, 3 weeks ago)
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Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Jim Allister (North Antrim) (TUV)
(Urgent Question): To ask the Secretary of State for Business and Trade if he will make a statement on the US-UK trade deal, with particular reference to the impact on Northern Ireland.
The Secretary of State for Business and Trade (Jonathan Reynolds)
With your permission, Mr Speaker, I am grateful to be able to give a statement today, following that given by my right hon. Friend the Minister for Trade Policy and Economic Security on Thursday, to update the House on the agreement we have reached with the United States and specifically to address the important circumstances of Northern Ireland.
I can confirm that we have closely considered the impacts of this agreement on Northern Ireland. I have personally spoken to the First Minister and Deputy First Minister twice while negotiating this deal, the first time alongside the Prime Minister. I want all Northern Ireland colleagues to know that the importance of Northern Ireland in this deal, and all trade deals, is paramount to me personally, and I commit absolutely to working with any colleague from Northern Ireland on the implementation of agreements of this sort.
First, as Northern Ireland is part of the UK’s customs territory and internal market, Northern Ireland exporters can access the US market under this deal on the same preferential basis as the rest of the UK. Secondly, this deal does not affect how imports to Northern Ireland operate. US origin goods will be able to benefit from this deal where they are not at risk of entering the EU. As a result of the Windsor framework, Northern Ireland businesses importing eligible US goods under this deal can avoid any unnecessary duties with established schemes such as the UK internal market scheme. Thirdly, there is a comprehensive tariff reimbursement scheme. The difference between the UK and EU duty can be claimed back, so long as it can be demonstrated that the goods did not enter the EU single market. The customs duty waiver scheme also allows at-risk duties to be waived entirely regardless of the destination, subject to an overall limit. As we have said all along, we have continued to act in the best interests of all UK businesses, which very much include those in Northern Ireland.
More broadly, I can confirm that this agreement saves thousands of jobs, gives the UK an advantage over other countries in relation to trade with the US, and confirms a process of potentially securing a much wider trade agreement between our two countries. The UK-US trading relationship, which is already worth £315 billion, is important and growing. We have £1.2 trillion invested in each other’s economies, employing around 2.5 million people across both our countries. That is why this deal was so important. Throughout our negotiations, businesses have consistently praised our calm-headed, pragmatic approach to working with President Trump’s Administration and I thank them for their engagement, their support and their advocacy.
Turning to the detail of the agreement, in no industry was the potential impact of tariffs more acute than in our automotive sector. We have therefore negotiated a quota of 100,000 vehicles where tariffs will be reduced from 27.5% to 10%—
Mr Speaker
Order. I gently say that answers to urgent questions are only meant to last for three minutes. I can see that you have quite a few more pages; I am happy to take them because I think it is important that the House knows about the deal, but we need to understand what we have granted and what we have not granted. I do not want to go back over the events of Thursday, when nobody seemed to understand the procedure of the House, and I recognise how important this issue is to hon. Members but, seriously, we should know the rules and I just wonder how this has gone wrong again.
Jonathan Reynolds
Mr Speaker, I am incredibly grateful for your forbearance. If it is okay, I will continue to these words, given how important I know the matter is to all Members of the House.
Mr Speaker
Order. If it is so very important, why was it not presented to the House as a statement or converted? That is what I would say. I never quite understand—the other day, we could not convert them quickly enough, but today we do not want to.
Jonathan Reynolds
Mr Speaker, I would have been more than happy to make it a statement, and I was hoping to be able to do so.
We have negotiated a quota of 100,000 vehicles where tariffs will be reduced from 27.5% to 10%, and secured an agreement for associated car parts, recognising the vital role that this sector plays in our economy.
For steel and aluminium, this deal will remove the 25% additional tariffs that were put in place earlier this year, reducing US tariffs on core steel products to zero. This will provide a critical lift for the steel industry, which has been brought back from the brink of collapse, allowing UK steelmakers to continue exporting to the US. This follows our intervention last month to take control of British Steel and save thousands of jobs in Scunthorpe.
For pharmaceuticals and life sciences, this deal provides assurances that we will receive significantly preferential access in case of any new US tariffs, something that, so far, only the UK has secured. As the pharmaceutical manufacturing sector contributes £20 billion to the UK economy a year and employs around 50,000 people, this was a priority for us.
On aerospace, we agreed that UK aerospace exports, such as Rolls-Royce engines and plane parts, will have a specific guarantee of zero tariffs as a result of this deal. This will be a huge boost to the sector, which supports 450,000 jobs in the UK.
To secure this deal, we have made agreements with the US on beef, ethanol and economic security. On beef, we have agreed a new quota of 13,000 metric tonnes, and have reduced the UK tariff on existing US imports coming through a World Trade Organisation quota limited to 1,000 metric tonnes. Crucially, I can confirm this will comply with sanitary and phytosanitary standards, in accordance with the commitments that we have always made.
The increase in the quota of 13,000 tonnes compares with the 110,000 tonnes in the Australia deal negotiated by the last Conservative Government. Even more importantly, the deal is reciprocal, meaning our UK beef farmers will have unprecedented market access to the US. Our farmers will be able to export their high-quality beef through an exclusive UK quota to a market of over 300 million people, providing unparalleled access to the world’s largest consumer market.
On ethanol, we already import a significant amount of ethanol from the US and have agreed a duty-free quota capped at 1.4 billion litres. We are working closely with our domestic sector to understand its concerns and any potential impacts to businesses, including what more Government can do to support the sector.
Finally, the UK and US will strengthen our co-operation on economic security and work together to combat duty evasion. We will continue to use investment screening measures already in place, and we will work together to protect our existing supply chains from any third-country investment that concerns either one of us. This Government will take a consistent, long-term and pragmatic approach to managing the UK’s relationships with third countries, rooted in our UK and global interests.
As we have made clear, the aspiration on both sides is that this is just the beginning, with the US agreeing to deepen transatlantic trade and investment further, and to progress discussions towards a transformative UK-US technology partnership. This deal has seen jobs saved and jobs won, but it is by no means job done. The siren voices of the extremes can claim to be the voice of working people all they want, but we know that on matters of action on wages, security and opportunity, it is this Government who will make the difference.
The deal comes on the back of our India trade deal earlier last week and on the promises that many Governments have made to secure trade agreements with the US. Although many people have talked about those deals, it is this Government that have got them across the line for every bit of the UK, including Northern Ireland.
Jim Allister
For all his verbosity, the Secretary of State came nowhere close to addressing the issues that arise from the fact that this Government and this House do not control the trade laws of a part of this United Kingdom—namely, Northern Ireland. Under the Windsor framework, Northern Ireland was placed under the EU’s customs code, so it is therefore its tariffs, not the UK’s tariffs, that govern the imports to Northern Ireland. With the EU having no trade deal with the US or India, the resulting tariffs on imports under this deal will be higher when the goods come to Northern Ireland than when they come to GB. For manufacturing and consumers, that creates huge disadvantage and fundamentally contradicts the equal citizenship that is supposed to denote a United Kingdom.
The Secretary of State referred to the convoluted and tardy system of possible recoupment of tariffs, but the onus there is on those applying to prove that anything they produce will never go into the EU. It is no answer to Northern Ireland’s subjection to foreign trade laws, which we do not make and cannot change. The Secretary of State would not contemplate that for his own constituents, but he expects us to sup it up in Northern Ireland.
I will ask the Secretary of State about three specific issues. Under the deal, will it not be easier for US manufacturers to buy tariff-free steel from Great Britain than for manufacturers in Northern Ireland to buy the same steel from their own country to bring it into their own country? That steel will be subject to EU tariffs. How can that ever be compatible with Northern Ireland supposedly being part of the EU’s internal market? In terms of beef and the tariff-free trade within the quota that has been set, how can—
Jim Allister
Where there is a set quota for imports of beef, how can Northern Ireland participate in that if the UK cannot offer a reduced tariff rate in Northern Ireland? Does that mean that our beef-exporting farmers in Northern Ireland will be excluded? Surely all these trade deals expose the folly of surrendering part of our territory to foreign customs control.
Jonathan Reynolds
I am grateful to the hon. and learned Member for bringing this urgent question and for putting his community’s concerns on the record; I understand how strongly he will feel about them. There is much that I could say and criticise about the previous Conservative Government’s approach to a lot of things, but the approach that they took with the Windsor agreement to balance the obvious, practical problems and realities of Brexit—of leaving the single market when Ireland is in the EU and the customs union—alongside our commitments under the Good Friday agreement to observe what we have all signed up to and want to support is fundamentally better than when they threatened to break all kinds of international laws and agreements with key partners. It was the better way to find a way through them.
I absolutely accept and understand that this issue is difficult and complicated, but I can tell the hon. and learned Member that that is not just the perspective of the UK Government, in terms of working with our colleagues and ensuring that these issues are reflected in the agreements, but what we hear from the other side in these agreements. When we explain what we need to see happen around agreements such as this, we see that the US is absolutely committed to peace, to the Good Friday agreement and to the sound working of the Windsor agreement.
The hon. and learned Member has raised a number of specific questions, and I will ensure that we deal with them. We will meet with him and a delegation of MPs and ensure that we are in correspondence with him, as we have promised to be with the First Minister and Deputy First Minister. This approach is complicated, but it is far better than the one we briefly glimpsed in that difficult period when the Conservative Government did not have the Windsor agreement in place. Fundamentally, there is a difference between goods entering Northern Ireland and therefore entering the UK and goods entering Northern Ireland if there is a risk of them entering the single market more widely. This is a sound system to deal with that, and I accept that we must make it work.
This is not our system, but we recognise what the previous Government were trying to do. Whether the hon. and learned Member wants it or not, I offer him an absolute, unequivocal agreement that we will work with him on any concerns he or his community have to ensure that we get this right to the maximum degree possible.
Rosie Wrighting (Kettering) (Lab)
Can the Minister update the House on the Government’s engagement with the chemicals industry?
Jonathan Reynolds
Absolutely. Whenever any trade agreement of any sort is agreed, there will obviously be domestic impacts if our trading partners have requested further access to the UK market. That is particularly the case for the agreement on bioethanol. Senior officials from my Department have been meeting representatives of the domestic industry, and I have a personal meeting set up—on Wednesday of this week, I believe. A lot of the issues we need to address are wider than what has been agreed through this trade agreement, but our commitment to working with the domestic industry to help manage any trade-based transitions is absolute.
Greg Smith (Mid Buckinghamshire) (Con)
I congratulate the hon. and learned Member for North Antrim (Jim Allister) on securing this urgent question, although I agree that the Government really should have offered a statement to the House on this important subject.
Of course, the House has still not yet seen the full detail of the trade agreement with the United States of America. The Secretary of State says that this is just the beginning, but there are still a great many unanswered questions about what we have so far, including what are clearly ongoing negotiations on pharmaceuticals. In his answer, the Secretary of State said that the UK will have significantly preferential rates, but what does that mean in practice? Where is the detail about what “significantly preferential rates” actually means? There are similar questions about the digital services tax.
Last week, the shadow Secretary of State for Business and Trade, my hon. Friend the Member for Arundel and South Downs (Andrew Griffith), asked the Trade Minister a straight question: whether this trade agreement would
“protect the special status of Northern Ireland”.—[Official Report, 8 May 2025; Vol. 766, c. 899.]
The Minister was unable to provide an answer at the time, and I remain unconvinced by what the Secretary of State has had to say today—there is still a lot of talk about the risks of goods entering the European Union. Clearly, this is a far more complex situation than the Secretary of State would like us to accept. As the hon. and learned Member for North Antrim made clear, the EU is still hugely influential in Northern Ireland trade law. The points he made about steel, for example, were accurate and deserve clear answers.
It is clear that this deal will have a number of implications for the functioning of the dual customs regime, yet businesses in Northern Ireland have been left in the dark for too long by the lack of detail in last week’s announcement. I would therefore be grateful if the Secretary of State would confirm what discussions he has had with his US and EU counterparts about rules of origin and the green lane in Northern Ireland. What specific measures are the Government implementing to ensure that Northern Ireland businesses are not disproportionately burdened by increased costs and administrative complexities as a result of this trade agreement? Finally, given that the Prime Minister is gearing up for his surrender summit with the European Union next week, can the Secretary of State confirm that there will be no backsliding on Northern Ireland’s place as an integral, absolute and total part of our United Kingdom?
Jonathan Reynolds
That was a fairly odd stream of consciousness, if I am being totally honest. It appears that I have given a stronger defence of the Windsor agreement negotiated by the former Conservative Government than the Conservative party has managed today.
The shadow Minister has asked for detail. I acknowledge that, particularly when dealing with the US and the style of the US system, negotiations have a pace—a pulse—and they are perhaps different from how we would present the detail of a complete trade agreement, such as the one we agreed with India. However, I think he would acknowledge the importance of last week’s announcements, because such a significant part of our exports to the US is covered by its sectoral tariffs, not the reciprocal ones. Businesses would have had to start planning this week for a world of—in some cases—25% tariffs, which would have had major repercussions for jobs, businesses and growth in the UK. Being able to give those businesses reassurance, alongside a clear indication of the ongoing nature of the negotiations, is a significant win for British business. I hope the Opposition recognise that.
The hon. Gentleman asked specifically about preferential rates on pharmaceutical products. Those in the United States have not yet completed their own investigations in respect of some of the sectoral tariffs to which they have alluded, and have not announced what they are putting in place. The nature of the agreement, given that it covers the sectoral tariffs, is to recognise that we would want the UK to be in a preferential position on those as well, rather than agreeing what we have already agreed on sectoral tariffs and then seeing further sectoral tariffs announced in future.
The hon. Gentleman asked about the digital services tax. It is not in the agreement; it is not a part of what was announced last week.
As for the question of the special status of Northern Ireland, this is the agreement that the Conservative party struck. It manages two very difficult countervailing pressures. The Conservatives might have thought more about this during the Brexit process, but they did not. They had to resolve the issue after the agreement, and to be honest, I do not think they did a particularly bad job in reaching the compromise that Windsor represents.
Exports from Northern Ireland are covered by the preferential trade terms that we have secured with the United States. When goods come into Northern Ireland, there is a differential depending on whether they are staying in the United Kingdom or there is a risk of their entering the EU’s single market. That is what the Conservative party agreed. I think that the new degree of complexity comes from differentials between the EU’s approach to trade and trade defence, and our own, but surely we all recognise that part of what we are talking about here reflects the fact that we are not in the European Union. The hon. Gentleman again engaged in some language about the European Union.
This country did a trade deal with India last week, one that the Conservative party promised many times but never delivered. We reached an agreement with the United States in the same week. We have the EU summit coming up. Everything that we have said about how this country does not have to pick just one trading partner—it can be the best connected market in the world—is borne out by the agreements that we have signed. Every Member of this House should get behind a UK that is strong on the world stage and connected to each and every one of the major economic markets that we need to be our partners.
Joe Morris (Hexham) (Lab)
I congratulate the Secretary of State first on being papped in the away end on Friday night, and secondly on, twice in one week, upholding our world-leading environmental and welfare standards. Can he assure me that as these conversations—and, indeed, conversations with future trading partners—develop, further deals will always prioritise high food standards to protect both our farmers and our consumers?
Jonathan Reynolds
Last week was a good week all told, on footballing and trade matters. You may be noting, Mr Speaker, that my voice is a little hoarse as a result.
We on the Government Benches were elected on our manifesto commitment not to alter our sanitary and phytosanitary regime and our food standards. Some people said that a deal with the United States would not be possible if we stuck to that, but we did, and we have an agreement. That proves everything we said about why that issue is so important to us.
Jonathan Reynolds
We have discussed this issue across the Chamber on several occasions. We as a Government are not proposing any changes in how the UK and Parliament ratify treaties. I have never given the promises that the hon. Gentleman has mentioned; I have not changed my position. The position is as it always has been—that Parliament has a key role in scrutinising treaties, and any changes that require legislation or alterations in our domestic laws go through Parliament in the usual way.
I think the hon. Gentleman will recognise that this week there could have been announcements of job losses and restructuring that would have been very difficult for a range of important sectors in our economy, and I do not think any Member of Parliament would have wanted to see that happen because of a parliamentary process. I understand that the Liberal Democrats want us to rejoin the customs union, and that therefore trade deals with the United States or India would not be possible. That is consistent and fair, but it would have been very painful if that had been the UK Government’s position going into negotiations.
The hon. Gentleman asks about the impact of any potential issues in the global trading system on small businesses and the wider economy. They are significant for our bilateral relationship, but he will also know that the UK is very exposed to wider relationships because we are an outward-facing economy. That is why we have to be on the pitch with our sleeves rolled up, trying to find solutions for ourselves that other countries can follow.
The hon. Gentleman asks a very pertinent question about the film industry. Again, for any area where there has been the suggestion of sectoral tariffs but they are not yet in place—to be honest, it is not entirely clear what would be the subject of a tariff in the case of a film—we have language in the agreement that reflects that. We would cite that as an existing area where there is a really strong and mutually beneficial bilateral trading relationship between ourselves and the United States.
Chris McDonald (Stockton North) (Lab)
I welcome this trade deal, and particularly the beneficial impact it will have on the steel and automotive sectors. I was pleased to hear the Secretary of State mention his discussions on ethanol, where I know some concerns have been raised. I have spoken to industry representatives, and they are confident that they have a solution that will work well for the Government’s trade deal. Notwithstanding his meeting with Ensus on Wednesday, will my right hon. Friend meet me and senior representatives of the UK’s two bioethanol producers to discuss how they can make the Government’s trade deal with the US a major success?
Jonathan Reynolds
I am grateful to my hon. Friend for his question, and for his industrial expertise. I promise to have that meeting. Whenever trade arrangements have an impact on domestic industry, it is important that we work as a partner to industry in order to address that. He is right to say there are two substantial bioethanol plants in the United Kingdom that might be affected, and we are already setting up a process to work with them, as he has requested.
Sir Julian Smith (Skipton and Ripon) (Con)
This deal, as with the India deal, is good for the UK. It is particularly good for Northern Ireland, which in turn can also access the single market. However, the urgent question has some merit, because the reimbursement scheme is quite onerous, and I urge the Secretary of State and his team to look into where efficiencies could lie. Will he clarify how his Department can help Northern Ireland businesses to expand in the US and take advantage of this deal?
Jonathan Reynolds
First of all, I am extremely grateful to the right hon. Gentleman for pointing out that, across this House, there should be unanimous agreement that trade agreements with the United States and India are in everyone’s interests. I have been a bit dismayed by some of the feedback from those on the Conservatives Benches—not Back Benchers, but Front Benchers—because we should all recognise that such deals are important not only for our bilateral trading relationships with those key markets and for the potential growth that comes from that, but because they send a message to the rest of the world about free, fair and open trade at a time when that message is very much needed.
Feedback on the performance of the duty reimbursement scheme has been significant and we are working with partners in Northern Ireland, and with the Treasury, to see how we can improve the scheme. I think people recognise the fundamentals of the scheme and what it is trying to do, but there are complaints about how easy it is to access. I recognise that and commit to working on it.
We have a whole range of export programmes, as the right hon. Gentleman might be aware, but how exciting it will be to have businesses from Northern Ireland and every part of the UK take advantage of some of the new, liberalised trading relationships that we have in place. They are not only preferential to what we have had in the past, but preferential to what other countries have. For instance, the deal with India offers access to Indian Government procurement that no other country in the world has. I am excited by that, and I hope other colleagues are too.
Chris Vince (Harlow) (Lab/Co-op)
I thank the Minister for his vital work on this trade deal—I am feeling more and more like Jim Shannon all the time.
Chris Vince
Apologies. I am feeling more and more like the hon. Member for Strangford (Jim Shannon) all the time.
Can the Minister give the House some additional detail on how this trade deal and others will protect jobs in both Northern Ireland and Harlow? Does he agree that these trade deals mean that we avoid a trade war, which is good for everybody?
Jonathan Reynolds
I thoroughly endorse that. There are some significant headline wins from these trade agreements. Obviously, we are focused in the main on headline reductions in tariffs—whether that is whisky going from 150% to 40% under the India deal, or the removal of sectoral tariffs through the US deal—but there are other things. I have mentioned procurement from the Indian Government, but what really interests me is how we can remove frictions for smaller businesses and how we could have greater access to the US market. Trade—liberalised trade and free trade—is one of the absolute certainties for growth, for jobs and for investment. That is why I want all colleagues to be behind these deals. At times in the UK’s history, there has been a genuine cross-party consensus on the benefits that trade can bring, and I want to see every colleague on either side of the Chamber get out there and sell the benefits to businesses in their own communities.
Stephen Gethins (Arbroath and Broughty Ferry) (SNP)
This trade deal with the United States does not even touch the sides of the trade deal promised by Brexiteers. Neither does it touch the sides of the damage done by our being ripped out of the customs union and the single market. I have heard the Minister talk about the challenges, but there was a compromise that Labour used to back, or certain Labour Members would back, of remaining part of the single market and the customs union. What is it about a Reform and Tory Brexit that he embraces so well?
Jonathan Reynolds
That has never been our position. It was never the position in our manifesto and it was never our position after the introduction of Brexit. The hon. Gentleman talked about the promises that Brexiteers made. I am not accountable for those and never have been, and frankly I am relieved about that. I would simply ask him whether an economy of our size—a G7 economy—can contract out trade policy to a customs union when we are not part of the political arrangements sitting behind that. I just do not see that as realistic.
I hear the hon. Gentleman not get behind, for instance, the reduction in the Indian tariff on Scotch whisky from 150% to 40%, but he should promote his own interests a bit more strongly. Regardless of how Members voted in the referendum on the European Union, they should get behind the benefits for every part of the United Kingdom, whether in the deal with India or that with the US. It will not be the same as being part of the single market—that political decision was taken in the referendum—but despite that we can build the best possible position for every bit of the United Kingdom. I think we should look to the future, rather than relive the battles of the past.
I know this will not mean much to the SNP, but the political uncertainty after the referendum while we did not have the new arrangements in place really did cause harm to the UK. It was in itself a detriment, and that is exactly why the continued obsession about the constitutional position of Scotland is not in the interests of Scottish businesses. We are looking to the future, and agreeing deals that benefit every part of the UK, and if the hon. Gentleman cannot get behind that, so what? We will defend Scotland’s interests, and make sure it is getting better access to every market in every bit of the world.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
Although it pains me, as it does, to do so, I have to concede that whiskey is produced in Northern Ireland. When the Minister for Trade Policy and Economic Security made the statement on the Indian trade deal, he understandably placed great emphasis on the benefits to the Scotch whisky industry and indeed the UK whisky industry from that deal, but when he made the statement on the US deal, he said precisely nothing about whisky. Can the Secretary of State clarify exactly what is the current position on whisky with the US, and what is his aspiration?
Jonathan Reynolds
First, while we would all recognise the superiority of the quality of Scotch whisky, the deal with India also covers exports of gin. I was at the Beefeater factory, not far from here, last week. The deal also covers Northern Irish whiskey; Bushmills is part of this deal, too.
The right hon. Member’s question on the US is about the reciprocal tariffs put in place; obviously, no sectoral tariffs have been put in place on anything affecting whisky production. That conversation is part of the wider ongoing discussion about the reciprocal tariff, or the 10% as it is sometimes referred to. I believe there is no need for that and that it can come down, but there will have to be movement on the US side for that.
I think we could reach agreement on a whole range of tariff lines and product areas that would further deepen the trading relationship between ourselves and the US, and that is why we are committed to continuing this conversation. Of course, the UK is not a high-tariff country—as it is, what tariffs we have in place are relatively modest—and we therefore have to make sure that what we agree is in the interests of both countries. However, that will be part of the ongoing conversation, which includes the digital agreement we are seeking to strike and a whole range of other areas of interest to Members across the Chamber.
Sammy Wilson (East Antrim) (DUP)
The Secretary of State spent about five minutes of his response evading the question that was asked: what will the impact of this trade deal be on Northern Ireland? The fact of the matter is—and he has already said it—that this will be difficult and complicated, and we have to remember that the EU has a single market to protect. It seems he is more interested in protecting the EU from the dribble of goods that goes into the EU than protecting the internal market of the United Kingdom. The fact of the matter is this. The Secretary of State may say, “Well, provided that businesses can prove that parts and other things do not go into the EU, they can then get the taxes back.” But the process for doing that is so complicated, so convoluted and so time-consuming that very often businesses are without the money for a long, long time, with all the cash-flow problems. Then the Treasury spends an age getting the taxes—
Madam Deputy Speaker (Caroline Nokes)
Order. We do need to have a question.
Jonathan Reynolds
I understand that the right hon. Gentleman feels strongly about this, but I say again to him that any difficulty or complexity is not caused by this trade agreement per se. There is an arrangement in place—one that the Government support and one that, I believe, those on all sides of the House adhere to—that manages the particular situation that Northern Ireland was put in as a result of Brexit. That is the reality.
Where we have a lot of tension in the global trading system and differentials between ourselves and the EU—there are going to be differentials at times—it is incumbent on us all to manage them and ensure that Northern Irish businesses and consumers are getting the benefits of the trade agreements we are seeking, and that where there is that relationship to the wider European Union, we operate all those schemes in a way that is to their maximum utilisation and efficiency. I recognise that there are complaints about the duty reimbursement scheme, and we have worked with colleagues on that, but it is not these trade deals that caused that complexity; it was the particular situation that the previous Government needed to find a solution to—and, to be fair to them, they did find a solution. We, on all sides, are committed to honouring and making sure it is working.
Dr Andrew Murrison (South West Wiltshire) (Con)
As skilfully drafted as the Windsor framework certainly was, it could not possibly have fully anticipated President Trump and his tariffs, or the prospect of an EU-US trade and tariff war. Does the Secretary of State understand how concerned small and medium-sized businesses in Northern Ireland are? Suddenly, they are placed, potentially, at the epicentre of that trade war. It is all very well to say that they can claim back the differential in tariffs, but the bureaucracy involved in such an exercise, as the Secretary of State will understand, is substantial and significant. What will he now do to mitigate it?
Jonathan Reynolds
I understand the reasonable point the right hon. Gentleman is making—that perhaps large parts of the global trading system did not anticipate the position we find ourselves in today—but I believe it was drafted recognising that there would likely be divergence in trade policy between the United Kingdom and the European Union, and that is what we are seeking to manage. He mentions—I understand this, because it is the feedback we receive in the Department as well—things like the complexity and the functioning of the duty reimbursement scheme, and how it needs to work better. I hear that from businesses in Northern Ireland and I am hearing it very clearly in the Chamber today. Obviously, that relates to His Majesty’s Revenue and Customs and a Treasury responsibility, but I give him an absolute assurance that we are listening and we are committed to doing this. But it is incumbent on all of us to make it work.
Robin Swann (South Antrim) (UUP)
I thank the Secretary of State for his extended answers. In his original answer, he said that he had spoken with the First Minister and the Deputy First Minister twice. Were they supportive of the Government’s approach? Did they raise any concerns? How were those concerns mitigated? Did they agree to the final deal? With regard to the EU re-set negotiations of 19 May, are the Government engaging with the Northern Ireland Executive parties?
Jonathan Reynolds
I regularly meet all colleagues across the United Kingdom to keep them updated on matters of trade. Those were specific meetings in relation to what was being negotiated with the US. The final decision on any trade agreement is with myself and the Prime Minister. We do not seek formal agreement per se from colleagues in the devolved Governments, but we keep them informed as to what we are negotiating, the kinds of issues coming up on the other side and how we deal with that. It is not for me to reveal the content of those conversations, but the kind of reasonable concerns being aired in the Chamber today, about how things like the reimbursement system works and the feedback from Northern Ireland businesses, were of course a part of that conversation. We committed again, as I have done here at the Dispatch Box, to work with them on effective solutions to those problems.
Caroline Voaden (South Devon) (LD)
The Secretary of State says that free trade is essential for growth. What a shame that the trade across the UK is still so badly affected by us not being part of the customs union. When Labour was in opposition, he called for
“a proper role for Parliament in how trade deals are ratified”,
and argued that there needed to be
“a much higher level of scrutiny than we are seeing now”
under the previous Government. There are clearly many questions about how the deal will affect businesses in Northern Ireland. We have seen how the Australia trade deal has been allowed to undermine British farmers across the UK, animal welfare and food standards, thanks to a lack of parliamentary scrutiny under the Conservatives. Farmers in my constituency are worried that American agribusiness will undercut them with inferior meat. I hear what the Minister said about upholding SPS—
Caroline Voaden
Will the Minister provide reassurance that Members of this House will be given the opportunity to fully scrutinise and vote on the new trade deal with the United States?
Jonathan Reynolds
The hon. Member will have heard my earlier answers. I believe that Parliament should play a role in scrutinising trade legislation, and indeed any international agreement, but it is not the case in the United Kingdom that we have formal “up or down” votes on any treaty. We vote on the implementation of those agreements, and the responsibility for negotiating and agreeing those is with the Government, rather than Parliament. I am not aware of any substantive proposal to change that system. It is certainly not something that the UK Government today are committed to doing.
The hon. Member talks about the impact of leaving our existing trade relationships in the customs union. That was part of that referendum. I understand how people feel intensely about that. [Interruption.] People have different interpretations of why they voted. We can relive the argument forever or we can focus on the future, on reducing barriers to trade and on the kinds of agreements delivering advantages for every part of the UK, and that is exactly what we are doing. Had we in this case still been part of the customs union, there would be no breakthrough with the US or the India trade deal. All colleagues need to balance up the two things alongside each other. In relation to the automotive sector, that lack of a breakthrough would have meant significant job losses this week in the United Kingdom, and that would have been very painful for all of us.
Madam Deputy Speaker (Caroline Nokes)
With what I am sure will be a pithy final question, I call Jim Shannon.
Jim Shannon (Strangford) (DUP)
You have set me a challenge, Madam Deputy Speaker. I thank the hon. and learned Member for North Antrim (Jim Allister) for securing this urgent question. It is so important to talk about this issue in this place. It has caused considerable problems for my Strangford constituents. In particular, I mention three distilleries—Echlinville, Rademon and the Hinch—but many other businesses are affected, too. How does the Minister plan to address the tariff differentials that may arise for Northern Ireland following the UK-US trade deal? It may see any EU retaliatory tariffs on US goods being applied to US goods entering Northern Ireland, potentially creating an Irish sea border for US goods.
Jonathan Reynolds
There is only one Member for Strangford, and no one could mistake him for anybody else in asking a question of that sort. He asks about the definition of whether goods are at risk of entering the single market when they come into Northern Ireland. That is based on a percentage differential in the tariff between the United Kingdom tariff rate for a good or tariff line and that for the EU. I believe that a 3% differential puts a good coming into Northern Ireland potentially at risk and therefore considered for the higher tariff up front. In this case, that would be the EU one, and it would then be reimbursed. I understand that it is a more complex position for businesses in his constituency than for many other things, but we have to make this work. We have to be committed to working with businesses in his area, in Northern Ireland and in the wider United Kingdom, and specifically with political leaders, to ensure that we are getting this right. I am hearing, and I have heard many times, about how we can make that system smoother, more reliable and more efficient. We will take that away and work with our colleagues to do that.
However, the system in place is balancing many different competing pressures, and there are no obvious or easy solutions. I was a parliamentarian when we went through all the potential outcomes when a different party was in charge. Let us make it work. Let us listen where we need to improve things, but let us recognise that this agreement fundamentally addresses some of the core problems that existed when this country chose to leave the European Union.
Madam Deputy Speaker (Caroline Nokes)
I thank the Secretary of State for his very detailed answers this afternoon.
Oral Answers to Questions
Jonathan Reynolds Excerpts(3 months ago)
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Ellie Chowns (North Herefordshire) (Green)
The Secretary of State for Business and Trade (Jonathan Reynolds)
I announced in July that we were resuming free trade agreement negotiations with the Gulf Co-operation Council, India, Israel, the Republic of Korea, Switzerland and Türkiye. We have also begun talks with the United States on an economic prosperity deal, and we support the Cabinet Office with trade aspects of the EU reset.
Ellie Chowns
Given the utter unreliability and, frankly, economic illiteracy of President Trump, and given that the EU is by far our largest trading partner, it is clear that the best interests of the UK are served by our having a deal that allows the closest possible co-ordination with the EU. Does the Minister agree with me that that should cover youth mobility, and improved energy and climate co-operation? Specifically, will he work with his colleagues to ensure that we ease burdens for British business by linking the UK and EU emissions trading schemes, and by aligning on chemicals regulation, to boost British productivity and prosperity?
Jonathan Reynolds
I think that was a few questions, but we seem to have time for them today, so I welcome all of them. First of all, I recognise exactly what the hon. Lady says. When it comes to the importance of the EU as a principal trading partner for this country, the figures speak for themselves. I disagree with her about us having to choose between the US and the EU, or any other markets. I believe that the UK can be well positioned for all markets. There will be strong political views in this place about political leaders in a range of countries, but I would just say to her that when it comes to the United States, there are potentially thousands of jobs at stake. That is why we are pursuing a trade and economic prosperity deal with the US, and I think we cannot get away from that.
On the questions relating to the EU, a successful negotiation takes two parties. I want to see greater co-operation. I would not talk about the specifics of any part of the negotiations, but I would not want the kind of barrier that she identified to be in place. I want the UK to have the best and most frictionless trade possible with the EU, in a way that is consistent with our aspirations and obligations with the rest of the world, but she has made her point very well, and I recognise it.
Carolyn Harris (Neath and Swansea East) (Lab)
I declare an interest as the trade envoy to New Zealand. What conversations has the Secretary of State had recently with his New Zealand counterparts on the implementation of the UK-New Zealand free trade agreement?
Jonathan Reynolds
First, let me thank my hon. Friend for all her work as our trade envoy to New Zealand. She knows, because she was present, that on his visit to the UK, New Zealand Prime Minister Luxon spent the day with the Prime Minister, and I was able to spend considerable time with him in the afternoon. We discussed the implementation of the UK-New Zealand FTA, as well as the comprehensive and progressive agreement for trans-Pacific partnership, and the importance of working together to support free trade and to protect a rules-based trading system. We are working to ensure that businesses are using the FTA to support the Government’s growth agenda and the plan for change. Later this month, we will host the UK-New Zealand FTA joint committee, which will discuss continuing to grow UK and New Zealand trade.
Dame Harriett Baldwin (West Worcestershire) (Con)
It is good to hear that the trade negotiations with India, which began when we were in government, are progressing well. There must surely now be an opportunity to reopen talks with Canada, so it can buy more wonderful cheese from the UK. With the tariff clock ticking, I am sure the Secretary of State recognises that the US deal is the most urgent; many UK jobs are at risk. However, we heard recently from the Chancellor, when she was in the States, that her bigger priority is discussions with the EU, where we already have zero tariffs and zero quotas. Does the Secretary of State share the Chancellor’s priorities, or does he think the US is more urgent?
Jonathan Reynolds
I thank the hon. Lady for the earlier part of her comments. She is right that we wanted the previous Government to secure the India FTA, and we were willing to support them fully in doing that, but they were unable to get it across the line. With Canada, there are issues, particularly around agriculture, that are similar to those involving the US, so that may be more of a challenging negotiation.
The entirety of this Government, however, have been clear that we are not seeking to pick between one market and another—both are absolutely fundamental. The Chancellor’s comments specifically relate to the simple truth that there is a much greater quantum of UK-EU trade than UK-US trade. Equally, though, in all these negotiations, we have to focus on not just what can be done quickly, but what can be done right and in the national interest. There is no point securing an agreement that does not deliver on our objectives, no matter whom that agreement is with.
We will welcome any support from the Conservatives for the work we are trying to do. I do believe it is easier politically for this Government to do some trade agreements that are available to the UK; some may not have been politically available to the Conservative Government. We will continue to do that work, and we welcome all support for it, from across the House.
Clive Jones (Wokingham) (LD)
Yesterday, I asked the Prime Minister whether Parliament will get a final vote on any trade deal negotiated with the United States, and the Prime Minister stated that it would go through the known process. That process does not include a vote for MPs on the ratification of any trade deal. Will the Secretary of State therefore make it explicitly clear, with a yes or no, whether MPs will get a final vote on the deal with the United States? The PM’s answer yesterday implied that we would not.
Jonathan Reynolds
The answer, as the hon. Gentleman knows, is no; we are not, in this Government, seeking to change the ratification process for any treaty. He knows the process and how it works. The Constitutional Reform and Governance Act 2010 sets out that process. It allows MPs to scrutinise any treaty agreed with a country and presented to the House. The implementation of any aspect of any treaty still has to come to Parliament, of course; it is not the case that any agreement on any kind of international treaty can supersede what we agree in this place. In that process, all Members of Parliament get the same rights and privileges, quite rightly, but no—we are not proposing changes to the process by which we agree treaties with other countries.
Graeme Downie (Dunfermline and Dollar) (Lab)
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Jonathan Reynolds
I regularly engage with my Cabinet colleagues on a wide range of issues, and in particular the UK’s ongoing trade discussions with partner countries, given the cross-cutting nature of those matters. The Secretary of State for Environment, Food and Rural Affairs is a key partner in that process, including with the US.
As colleagues know, we have had constructive discussions with the US on an economic deal, and we remain committed to those talks, but we have made it clear that we will only ever sign trade agreements that align with the UK’s national interests. Our manifesto was also clear that we will always uphold our high food standards.
Mr Carmichael
The Secretary of State in DEFRA recently appointed Baroness Batters to lead a profitability review in farming and has set up a farm profitability unit in the Department. Those are welcome and necessary steps, but it is not entirely unknown for the efforts of one Government Department to undermine those of another, so before the Secretary of State signs any trade deal with America, will he check in with DEFRA and run the rule over what it is doing on farm incomes so that he does not undermine its efforts?
Jonathan Reynolds
We will all struggle to believe that at times different Departments could be better co-ordinated —I cannot recognise that at all!
I absolutely agree with the right hon. Gentleman. The moves to look at the business models around farming and profitability are welcome, and I think colleagues on both sides of the House would support that. On matters of trade, DEFRA and its Secretary of State are closely involved with those conversations.
Perhaps in the past the community has not always felt this, but in some of the ongoing trade negotiations that we are progressing there are real export opportunities for UK agriculture. Its quality and the premium and brand associated with that is a market that is growing around the world. Part of our discussions in a range of different trade negotiations is about ensuring that there are more opportunities in future, but I promise the right hon. Gentleman that the overall efforts of Government in the sector are co-ordinated, and that is ongoing.
James MacCleary (Lewes) (LD)
Blake Stephenson (Mid Bedfordshire) (Con)
The Secretary of State for Business and Trade (Jonathan Reynolds)
As we have heard, the US is our largest single country trading partner, with total trade worth £315 billion in 2024, representing 18% of total UK trade. More than a million Americans work for UK-owned businesses and vice versa. We have regular and ongoing constructive negotiations with our US counterparts, including some this week, on securing a wider economic deal to benefit UK businesses and our economy. In those talks, we continually push the case for free and open trade. Nobody wants to see a trade war, so our focus is on keeping calm and continuing to negotiate in the interest of UK businesses and consumers.
Blake Stephenson
As the UK’s top export country, the US is a vital partner to many UK businesses, but with Trump now reported to have made the UK a second-order priority to Asia and with the UK possibly on the verge of giving up its Brexit freedoms in favour of EU alignment, how confident is the Secretary of State of achieving a comprehensive free trade deal with the US, in both goods and services?
Jonathan Reynolds
First, let me assuage the hon. Gentleman’s concerns: that is a misreading of how the US is approaching these negotiations. The US has perhaps more complex issues with some countries that will take more bandwidth on its side. As I have always said, the existing relationship between the UK and the US is incredibly strong, reciprocal and mutually beneficial. I see far fewer issues to negotiate to get to that outcome.
Again, I would push back on anyone attempting to put the case that the decisions we make must be based on either the EU, the US or any other partner being our principal partner. The role for the UK is to position ourselves in this challenging world with a genuine strategic advantage because we do things that improve our trading relationship with the EU; we secure this US deal; and we secure the deals with India, the Gulf and other key markets. I am pragmatic about where the UK’s national interest lies and am absolutely confident that it is possible and desirable.
Liam Byrne (Birmingham Hodge Hill and Solihull North) (Lab)
Today the Select Committee writes to the Secretary of State to supply our response to his consultation on how we should respond to American tariffs. We have heard widespread consensus that there should not be retaliatory tariffs and that the approach the Government are pursuing is right, but we have also heard real concerns especially in the automotive industry among those big exporters to America and, crucially, their supply chains. Can the Secretary of State reassure the House that he is readying support packages across Government to ensure that our automotive sector does not run into serious trouble if we cannot get a deal with America soon?
Jonathan Reynolds
As my right hon. Friend knows, I always welcome communications from the Select Committee and the constructive and helpful role it plays in all these important matters. He is right to say that the business community in the UK strongly backs the Government’s calm and level-headed approach to these difficult issues. The automotive sector is one of our major priorities. It is the sector that has the most exports because of the brilliant success we have with automotive exports to the US. It remains an absolute priority for us in any negotiation to secure what we need, which is the continuation of access to US markets in a way that is complementary to the US and that meets the ambitions of US consumers. Frankly, I do not see any argument for making that relationship more difficult through the long-term imposition of tariffs. We are closely engaged in a number of important meetings this week with senior automotive leaders, and we will continue to prepare that, working to keep the Select Committee involved.
Gregory Stafford (Farnham and Bordon) (Con)
The Secretary of State for Business and Trade (Jonathan Reynolds)
When we took office, years of Conservative neglect had left our steel industry on the brink, but while others were willing to let the heart of British industry go cold, we were not. I welcome the recent conversion of Opposition colleagues to an active industrial policy, but make no mistake: while others may talk tough, only Labour can be trusted to act in the interests of British workers.
When the future of British Steel was on the line, we took immediate action. I can report to the House that thanks to our intervention we have secured the raw materials to keep Scunthorpe’s blast furnaces lit, and British Steel has cancelled the redundancy consultation, which put 2,700 jobs at risk. It was an honour to visit Scunthorpe and Immingham port recently to meet British Steel workers, and I am enormously grateful to them for their resilience, determination and hard work during a turbulent time.
There is still much to be done to protect and rebuild our steel industry as a whole after a decade of failure, and that is why we are committed to a £2.5 billion clean steel fund and to work with industry on our steel strategy. We have always said that steel has a bright future in this country, and our actions over the past month have shown that we meant it.
Gregory Stafford
To bring the Secretary of State to Hampshire and Surrey, there are major regeneration schemes under way in my constituency at Farnham, in Brightwells, and the new town centre in Bordon. Both will ultimately depend on attracting physical businesses, be it retail, hospitality or otherwise, for their long-term success. Does the Secretary of State agree that the Government should actively support prospective businesses in those areas, and does he not recognise that new taxes such as the national insurance contribution increases that his Government have imposed on businesses will cause businesses in my constituency to falter before they have even taken off?
Jonathan Reynolds
I welcome the progress being made in the hon. Gentleman’s constituency—I thought he was about to invite me there, which is often the case at topical questions, but I sadly did not manage to secure an invitation. I have been absolutely clear: I genuinely wish the inheritance of this Government was a better one in economic terms than the one we received. I genuinely wish the Conservative Government had not left that black hole and that we had not had to make difficult decisions, but life is sometimes about difficult decisions, and Government and business certainly are as well. Without investment in infrastructure, without a serious approach to the fiscal rules, which was absent for much of the last Government, and without investment in the health service, we would struggle. I welcome the success he is talking about; I am always keen to work with him on that.
Paul Davies (Colne Valley) (Lab)
Andrew Griffith (Arundel and South Downs) (Con)
The Secretary of State says that all the funding required for the nationalisation of British Steel will come out of existing budgets. We have seen his Department’s budget—we had an estimates day debate in the House not long ago—and there was no unallocated pot. Could he be a little more specific about exactly which budget the money is coming from?
Jonathan Reynolds
The shadow Secretary of State points to the statement in which I said that in the previous budget there was a £2.5 billion allocation for the green steel fund. Of course, that came in addition to the £500 million for the Port Talbot transformation, which was agreed under the previous Government but was not in the Departmental accounts—as he knows, it was in a heavily oversubscribed Treasury reserve. Yes, the green steel fund will be there to support what we have had to do at Scunthorpe. Again, as I said when Parliament was recalled, the question there was whether we would pay a significant amount of money for the total loss of the business; give a large amount of money to Jingye, but without the certainty that it would be able to deliver on that plan; or step in and take the action that we did, which I am confident was the right option for value for money and for Scunthorpe.
Andrew Griffith
I thank the Secretary of State for his answer. I think it is widely agreed that the cost of nationalising British Steel could run into the billions. Is he really saying that he plans to raid the previously allocated £2.5 billion green steel fund from the national wealth fund, and how is he doing that given that the national wealth fund is operationally independent? Is not the truth that, sooner or later, this will have to come from his department’s budget at the expense of financial support for the automotive sector, exporters and hard-working trade negotiators?
Jonathan Reynolds
I recognise the shadow Secretary of State’s concern, but let me reassure him on that point. The options available to the Government were: first, the total collapse of British Steel, which would have had an incredible cost to the Exchequer of well over £1 billion; secondly, the request from Jingye for £1.2 billion, which the Leader of the Opposition said she did or did not agree to in some way with it going to Teesside, at very significant cost; or thirdly, as we have done so far, the provision of working capital to British Steel in order to pay wages and continue the purchase of raw materials and the operation of the business. Of course, those costs will be incurred by the company, because they will enable it to produce and sell steel. I will write to him with the details if he is not confident in the decision that we have made, but it was the right decision not just for the steel industry but for the taxpayer.
Gareth Snell (Stoke-on-Trent Central) (Lab/ Co-op)
Jonathan Reynolds
I am always keen to support my hon. Friend, and I will certainly consider that legislation. We are not a protectionist Government—we welcome open and free trade—but we believe British goods can compete on quality, and his area is a fine example of that. Where British goods are being undercut, not by price and fair competition but by misrepresentation and fraudulent practices, we take that seriously and have taken more powers to deal with it. I am sure that he will raise this shortly during the urgent question. We will ensure that we give him the support he needs to pursue it.
Olly Glover (Didcot and Wantage) (LD)
Sir Jeremy Hunt (Godalming and Ash) (Con)
If the Secretary of State is not going to visit Farnham, can I tempt him to visit Fountain Beauty Therapy in Hurtmore, a much-loved business in my constituency? The owner, Clare Porter, talks about the extreme pressure caused by the Employment Rights Bill, the hike in employers’ national insurance and the withdrawal of business rates relief, leading to a crisis in the hair and beauty sector. What measures is the Secretary of State planning to alleviate pressure on this very important sector?
Jonathan Reynolds
I am grateful to finally get an invitation to somewhere. We understand that there are significant pressures for many businesses, and the global situation certainly will not provide reassurance in the short term. The measures in the Employment Rights Bill are not in effect yet and will take some time to come in. Since the election, nearly 200,000 jobs have been created, so the labour market is holding up particularly strongly. There are particular issues such as making sure we get probationary periods right and that zero-hours contracts are monitored in the right way, and we are working with business on that.
Peter Swallow (Bracknell) (Lab)
Euan Stainbank (Falkirk) (Lab)
On the day of the Government’s necessary action to save British Steel, I sent the Secretary of State a letter requesting a meeting to discuss what further we need to do for Grangemouth, where hundreds of jobs have been lost this week when Petroineos decided to cease refining operations, and where thousands of further jobs are at risk. Will he commit to meeting me to discuss the urgent actions that we need to take to secure accelerated investment in Grangemouth’s industrial future?
Jonathan Reynolds
I can absolutely give that assurance. I have had meetings about this issue just this week. We are ambitious for the just transition for Grangemouth and recognise the issues not just with the refinery but with the polyethylene cracker. We will get to work and set that meeting up.
Harriet Cross (Gordon and Buchan) (Con)
Many rural businesses rely on farms for their trade. Since the Government announced the family farm tax in the Budget, CBI Economics has spoken to over 4,000 businesses and farms across the country—49% said that they have either cancelled or deferred investment, and 34% said that they have reduced or paused it altogether. How can the Government say that they are supporting local businesses, and what will the Department do to support farms and rural businesses that are suffering because of the Government’s policies?
Jonathan Reynolds
I feel that is a question for either the Treasury or the Department for Environment, Food and Rural Affairs, but the hon. Lady made it well. Agriculture features prominently in trade and business, and I will ensure that she gets the right opportunity to put questions about taxation to the Chancellor.
Ben Obese-Jecty (Huntingdon) (Con)
Across my constituency in recent weeks we have experienced severe delays to post in those areas served by the Huntingdon delivery office. That follows a recent restructuring of the workforce and changes to delivery routes. Rural communities and businesses, in particular, have been impacted, with missed hospital appointments and several businesses telling me that it is affecting their ability to receive and therefore pay invoices. Will the Minister urgently investigate those ongoing and worsening delays in Huntingdon, and write to me with the outcome of his findings?
Jim Shannon (Strangford) (DUP)
What discussions has the Minister had with his counterpart in Northern Ireland about encouraging young people into casual hospitality employment, to teach them about the benefits of work and the importance of managing money?
Jonathan Reynolds
I am always grateful to the hon. Gentleman for his questions. We always seek to keep colleagues in Northern Ireland well briefed on a range of issues, particularly some of the complexities around trade that have come out of the Windsor agreement and need to be managed carefully. I do not think I have had a specific conversation about the matter he raises, but this is a good opportunity to say that I think I should, and I will. I am grateful to him for getting that on the record.
James Wild (North West Norfolk) (Con)
Will the Secretary of State be straightforward with the House today about how much taxpayers’ money has been spent so far on British Steel?
Jonathan Reynolds
The amount of working capital provided to British Steel to date stands at £94 million, which is considerably less than if we had given a large amount of money to Jingye, or if we had had to deal with the complete loss of the entire British Steel site and business.
Chris Law (Dundee Central) (SNP)
Modelling by the Scottish Government has shown that Brexit-made barriers are likely to have reduced Scottish exports by £3 billion, compared with continued EU membership. Greater co-operation and a closer relationship with the EU will always be encouraged by SNP Members, but does the Secretary of State recognise that anything short of full single market and customs union membership continues to damage Scotland’s economy?
Nick Timothy (West Suffolk) (Con)
According to reports in The Guardian, Government sources have said that issues around visas have been resolved as part of the Government’s free trade agreement negotiations with India. Will the Secretary of State rule out visa liberalisation as part of those negotiations?
Jonathan Reynolds
We should always be careful about what we read in some newspapers. [Laughter.] The hon. Gentleman knows that we cannot give a running commentary on trade negotiations, but the UK-India talks have been fruitful this week. I am optimistic and excited for the future of what is a key relationship bilaterally and for the signal it can send to the rest of the world.
Steel Industry (Special Measures) Bill
Jonathan Reynolds ExcerptsSaturday 12th April 2025
(3 months, 3 weeks ago)
Commons ChamberRead Full debate Steel Industry (Special Measures) Act 2024-26 View all Steel Industry (Special Measures) Act 2024-26 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 94-I Marshalled list for Committee - (12 Apr 2025)
The Secretary of State for Business and Trade (Jonathan Reynolds)
I beg to move, That the Bill be now read a Second time.
We meet in exceptional circumstances to take exceptional action in what are exceptional times. Our request to recall Parliament was not one we made lightly. I am genuinely grateful to hon. Members in all parts of the House for their co-operation, and for being here today as we seek to pass emergency legislation that is unequivocally in our national interest. I thank in particular the staff in Parliament for facilitating today’s sitting, and the Prime Minister, the Chancellor and the Home Secretary for their support. Indeed, we can take this action today only because of the restoration of economic stability and the dedicated resources for steel in the last Budget. I acknowledge my hon. Friend the Member for Scunthorpe (Sir Nicholas Dakin), the hon. Member for Brigg and Immingham (Martin Vickers) and all my hon. Friends from Teesside for their advocacy and engagement on this matter, throughout, on behalf of their constituents.
As hon, Members will know, since taking office, the Government have been negotiating in good faith with British Steel’s owner, Jingye. We have worked tirelessly to find a way forward, making a generous offer of support to British Steel that included sensible, common-sense conditions to protect the workforce, protect taxpayers’ money, and create a commercially viable company for the future. Despite our offer to Jingye being substantial, it wanted much more—an excessive amount, frankly. However, we remained committed to negotiation, but over the past few days, it has become clear that the intention of Jingye was to refuse to purchase sufficient raw materials to keep the blast furnaces running. In fact, its intention was to cancel and refuse to pay for existing orders. The company would therefore have irrevocably and unilaterally closed down primary steelmaking at British Steel.
I want to make it absolutely clear that, separately from any conversation about a possible deal to co-invest in new infrastructure, the British Government offered to purchase the raw materials in a way that would have ensured no losses whatsoever for Jingye in maintaining the blast furnaces for a period of time. A counter-offer was instead made by Jingye: that we transfer hundreds of millions of pounds to it, without any conditions to prevent that money, and potentially other assets, being immediately transferred to China. Jingye also refused the condition of keeping the blast furnaces maintained and in good working order.
Even if I had agreed to those terms, I could not guarantee that further requests for money would not then be made. In that situation, with the clock being run down, doing nothing was not an option. We could not, will not and never will stand idly by while the heat seeps from the UK’s remaining blast furnaces, without any planning, due process or respect for the consequences. That is why I needed colleagues here today.
David Davis (Goole and Pocklington) (Con)
From what the Secretary of State has described, it is beginning to sound as though Jingye is trying to manoeuvre the Government into a recompensed nationalisation. Will he make it plain that if it tries to manoeuvre us into nationalisation, we will pay not more than a penny for the business?
Jonathan Reynolds
To be clear, where there is a transfer of ownership to the state, we would always pay the fair market value for the assets. In this case, the market value is effectively zero, so I take the right hon. Gentleman’s point entirely. I would say that the intention of Jingye has not been to engineer that situation; its intention has been to keep the downstream mills, which colleagues will know are fundamental to our construction and steel industries, and supply them from China, rather than from Scunthorpe; that is the situation.
Graham Stuart (Beverley and Holderness) (Con)
Is it now the view of the Government that primary steel production in the United Kingdom is an overriding national security issue?
Jonathan Reynolds
As the right hon. Gentleman will know—we have had this exchange at the Dispatch Box before—I believe that the capacity for primary steel production is important. The steel strategy looks at new ways of ensuring that, and at not just protecting the past, but at what the future may bring. Direct reduced iron technology is of significant potential interest to us for the future. However, this situation—involving the last remaining blast furnaces, and the proposition put to us—is exceptional and unique, and I need all colleagues to recognise that.
The legislation ahead of us today is therefore a proportionate and necessary step. It allows us to take control of British Steel’s blast furnaces, maintaining steel production and, by extension, protecting the company’s 3,500-strong workforce. The Bill does not transfer ownership to the Government. We will have to deal with that matter at a later date. I took the decision that given the exceptional nature of a recall, it would be better to limit the powers in the Bill, which are still significant, rather than introduce more complex matters of property rights and public ownership at this time.
Sir Jeremy Wright (Kenilworth and Southam) (Con)
The Secretary of State is taking extremely extensive powers for the Government, and they apply to what he describes in the Bill as “specified assets”. As far as I can see, they are not limited to blast furnaces or assets required for making virgin steel. Does he accept that he is leaving two hands on the tiller, when it comes to the operation of all the steelmaking companies to which the Bill may apply? In other words, he is saying that the Government can direct a company in relation to specified assets, but that company can do other things of its own initiative. Does he recognise that he is creating considerable legal complexity in the operation of those companies going forward? Why is that the right approach?
Jonathan Reynolds
I am extremely grateful to the right hon. and learned Gentleman for his thoughtful question. The fundamental purpose of the Bill is to allow me, as Secretary of State, and this Government to take control of this situation. The reason why this is the Steel Industry (Special Measures) Bill, and not a Bill specific to British Steel, is, as he will know, that the latter would be a hybrid Bill, and introducing that would be a far more complex procedure. With the clock being run down, that was not an available option.
The Bill broadly replicates the situation that would apply if the Civil Contingencies Act 2004 had been triggered, but rather than seeking to meet the threshold to trigger that Act, I am seeking parliamentary permission—the consent of this House and the other place—to take control, which I think is a better way forward. I want to make it clear to the right hon. and learned Gentleman and to the House that I want this to be a temporary position—I do not want these powers a minute longer than is necessary—but I need the powers to rectify and save the situation.
Richard Tice (Boston and Skegness) (Reform)
Given that the Secretary of State has inferred that the owner, Jingye, is not and has not acted in good faith, surely the right thing to do is to seize this great opportunity now, this weekend, and nationalise British Steel?
Jonathan Reynolds
A transfer of ownership to the state remains on the table. It may well, at this stage, given the behaviour of the company, be the likely option. However, our aspirations for British Steel remain a co-investment agreement with a private sector partner to secure a long-term transformation. The action I seek to take today is not a magic wand or a panacea. The state cannot fund the long-term transformation of British Steel, nor would it want to, but a failure to act today would prevent any more desirable outcome from even being considered, and that, again, is why we must act today.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
I applaud my right hon. Friend for his decisive action in this matter. I have only had a chance to read the Bill for 10 minutes—[Interruption.] That is not a criticism; it is the natural procedure of this House. The Bill could not be laid until First Reading. The Bill talks about compensation. He has made the point that he is not planning to take over and run British Steel, which is not the desirable option, but has he done some sort of impact assessment on the potential range of costs to the taxpayer in these circumstances?
Jonathan Reynolds
I think my hon. Friend refers to clause 7, which deals with compensation. Again, let me be clear: this is a clause that we would put in any Bill. We are not Russia, and we do not sequester assets. The language in the clause—the legal definition—is something that we would use in most standard procedures. Going back to the question from the right hon. Member for Goole and Pocklington (David Davis), the effective market value of Jingye is zero, so there is no inconsistency between those two points.
Samantha Niblett (South Derbyshire) (Lab)
What is happening today is something that mining communities like Swadlincote, in my constituency of South Derbyshire, will be feeling deeply in their souls. It is something that they could have only dreamed of back in the 1980s, when they wanted a Government who had their backs and prioritised the national interest. Instead, they had a Conservative Government who sold them down the river. Does the Secretary of State agree that this is a pivotal moment in our history, because we have a Labour Government prioritising our people and the national interest?
Jonathan Reynolds
This is a significant moment. How a country handles economic transitions is not about nostalgia for the past—we have to embrace the future—but how we help our people, our industry and our nation get to that point is key. My hon. Friend and I come from similar places, and we have not managed these transitions particularly well in the past. We are meeting this weekend to discuss the potential loss of thousands of jobs, which is what was on the line. The fact that we do not accept that, and that we will do things differently, is a welcome change.
Ed Davey (Kingston and Surbiton) (LD)
We will scrutinise this Bill today, but we want to do so in a constructive fashion. Given the huge damage that President Trump’s tariffs have done to the British steel industry, accelerating this crisis, does the Secretary of State agree that any Member of this House who actively campaigned for President Trump’s election and cheered him on has behaved shamefully unpatriotically and should apologise to British steelworkers?
Jonathan Reynolds
I am extremely grateful to the right hon. Member and his party for their presence today. He will not draw me on the other principal issue that we have been dealing with at the Department for Business and Trade over the last few days, but to be clear, the issues around British Steel are about more than the imposition of tariffs. The tariffs are not welcome, and I do not think there is justification for them to be put in place. I believe that it is in our interests, but also in the US’s interests, to agree a position that removes those tariffs in the interests of steelworkers.
Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)
I fully understand the nature of what the right hon. Gentleman is bringing forward. I also understand some of the requirements for speed in this case, and we can argue about whether this should have been done before. Having quickly looked through the Bill, I do not see a sunset clause. I ask about that not because I want the Government to set a particular date, but because such a clause would bring them back here to debate whether the process should be extended. It would therefore put a reasonable limit on Government activity without debate. Can he explain why there is no sunset clause in the Bill?
Jonathan Reynolds
I absolutely understand and welcome the right hon. Gentleman’s question. I do not want these powers for a minute more than is necessary. I cannot say at the minute, having drafted the Bill, the timeframe for which they will be required, but I will endeavour—and I commit at the Dispatch Box—to keep the House updated. Perhaps I will ask the Business and Trade Committee for its involvement, in order to make it clear how long we believe it will be. To be absolutely specific, where we make an order in relation to control of a steel undertaking, we can revoke the regulations once that control has been established and is no longer required.
Several hon. Members rose—
Jonathan Reynolds
I know there is huge interest, but I will make a little more progress and that might deal with some of the matters Members want to raise.
This is what it means to be a Government unashamedly on the side of working people—one that will never hesitate to take action to protect this nation’s assets and economic security. I understand that some have asked about precedent or referred to other troubled industrial situations. To be clear again, this is an exceptional and unique situation. The question for all Members is whether we as a country want to continue to possess a steel industry. Do we want to make the construction steel and rail we need here in the UK, or do we want to be dependent on overseas imports? As a Government, we are not passive in any way about the future of British industry.
Stephen Flynn (Aberdeen South) (SNP)
The Secretary of State has said this is “unique” and “exceptional” and made reference to energy transitions and thousands of jobs. In the Scottish context, many minds right now will be focused on the situation in Grangemouth, where we know that hundreds of jobs will be lost directly, as well as thousands in the supply chain. Were I, or perhaps even the local Member, the hon. Member for Alloa and Grangemouth (Brian Leishman), to bring forward a similar Bill to save Scotland’s only oil refinery and give the Secretary of State the executive power to do as he pleases—as he is doing with British Steel—would the Labour party back it as it is backing this Bill today?
Jonathan Reynolds
I am pleased for the chance to address this issue. The importance of Grangemouth is why this Labour Government have pledged £200 million to secure its long-term future. It is an important asset, but it is not the only remaining refinery; it is one of three crackers in the United Kingdom—that is important. Specifically, it is not a comparable situation, and the behaviour of the company is not comparable to the case of British Steel.
I also say to the right hon. Member, and indeed to all Members, that this is why we fought and fought again to secure the future of British shipbuilding by saving all four of the Harland and Wolff sites in England, Scotland and Northern Ireland. The right hon. Member will know that the commercial interest was not in the Scottish yards, but we held them together precisely because of our commitment to Scotland and the Union. It is also why within weeks of taking office we secured a better deal for the workers at Port Talbot. We have repeatedly acted, and we will continue to act no matter how hard the circumstances.
Alan Gemmell (Central Ayrshire) (Lab)
Does my right hon. Friend agree that the failure of the Tories and the SNP to develop an industrial strategy for Scotland meant that they had no plan for Grangemouth? They knew for over a decade about the problems at the refinery and did nothing. Does he agree that as soon as Labour came into power, we got to work and delivered support for the site, the workforce and the local community?
Jonathan Reynolds
I endorse my hon. Friend’s comments entirely. I do not believe there is a history of the SNP calling for the nationalisation of Grangemouth. It was, as ever, on the bandwagon. I think we all recognise that the SNP does not campaign on its record in running Scotland; it campaigns on grievance. My hon. Friend is absolutely right that the contrast is with a Labour Government in this place who are on the side of working people everywhere.
Jessica Morden (Newport East) (Lab)
The Secretary of State mentioned Port Talbot. I appreciate the unprecedented circumstances we find ourselves in today, when the Government have rightly moved quickly to safeguard primary steelmaking, and the Secretary of State will be very mindful of the extraordinarily difficult circumstances that the steel industry in south Wales has faced. I recognise the £80 million fund available, but can he make sure that south Wales and Llanwern benefit from their share of the £2.5 billion clean steel fund? Can that also be at the forefront of his mind?
Jonathan Reynolds
I am incredibly pleased to have the chance to answer the point my hon. Friend raises. The Port Talbot deal was originally negotiated by the previous Government. I did try to reopen it; I went to see Chandra in Davos and flew to Mumbai to talk to him about it. To be frank, I kept Port Talbot open on polling day, because it would have closed due to the industrial action that almost took place. The previous Government were nowhere to be seen, even before the result of the election was in. We were not able to reopen the deal, but we did negotiate a better deal. As a result, Port Talbot is in a stronger position than British Steel, because it has a long-term future in place. [Interruption.] This is because we improved on the deal that the Leader of the Opposition botched at the time. To be clear, the £2.5 billion green steel fund the Chancellor has put in place is in addition to the £500 million already going to Port Talbot. That is an incredibly important point.
Sarah Owen (Luton North) (Lab)
I thank the Secretary of State for giving way and for acting in the national interest—the complete opposite of the hon. Member for Clacton (Nigel Farage), who said he was against intervening to save British Steel two years ago. Does the Secretary of State think the hon. Gentleman said that in the British interest or in the foreign interests the Reform party seeks to serve?
Jonathan Reynolds
I believe that that is on the record. I hope to convince all colleagues today to support this action, which is in the national interest.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
When the blast furnaces in Port Talbot closed down last September, this Government could have taken exactly the same legislative action as they have chosen to take today. We will endeavour to amend the Bill to include Wales, because there is still the opportunity for this Government to make a real difference to the community of Port Talbot and the 2,800 jobs that have been lost there.
Jonathan Reynolds
I do not want to embarrass the right hon. Lady, but the blast furnaces have already closed at Port Talbot. They are not available to be saved —that situation has moved on. Let me stress again: Port Talbot is in a stronger position because it has that long-term future in place and the potential additional investments through the green steel fund.
Several hon. Members rose—
Jonathan Reynolds
I think I must progress, Mr Speaker. I can see your indication to do so.
Dawn Butler
I thank my right hon. Friend for giving way and for the considered way in which he is looking after the national interest. The steel unions—the GMB, Community and Unite—would like clarification that any board that is set up will have at its heart the steelworkers who have kept the steelworks going through thick and thin.
Jonathan Reynolds
We remain in close engagement with all the unions, which have been monitoring the situation closely. Again, I reiterate that the Bill is not in itself about a change of ownership; it is about a change of control to rectify the situation. However, I will certainly have regard to the comments my hon. Friend has made and, of course, the role of the workforce at all stages.
We will never accept the argument that steelmaking is a sunset industry. Steel is vital to every bit of the modern economy. Domestic demand for steel is set only to go up, not down. In the past few weeks alone, we have seen Heathrow airport announce multibillion-pound expansion plans requiring 400,000 tonnes of new steel, and Universal Studios confirm it will be building Europe’s biggest theme park and, where possible, will use UK-made steel to do so. This Government are backing the builders, not the blockers. With the action we take today, we have the chance to feed that boom with steel made in Britain.
The legislation we are setting out today will help to end the uncertainty that has been hanging over British Steel’s Scunthorpe site for too long. I welcome the Opposition’s support today for this recall, but this issue should have been resolved years ago. I believe they may now view it as a mistake to have given this essential national asset to this company.
I have to address the statement made by the Leader of the Opposition yesterday, which I do as a matter of genuine regret. She claimed that while she did my job, she negotiated a modernisation plan with British Steel to build an electric arc furnace at Teesside, followed by one at Scunthorpe. I wish to make it unequivocally clear to the House that the new Government inherited no such deal. We could not renege on that deal because it did not exist. On day one, I was told that there had been a lack of progress on this matter to date.
Jonathan Reynolds
If such a deal was negotiated, somehow in secret, I ask the Leader of the Opposition to say how much money she agreed to give Jingye for this deal and what conditions were placed on it. To state the obvious, building two electric arc furnaces in two different locations would be more expensive than building one in one location, and, given that Jingye’s request to build two furnaces in Scunthorpe was for £1.2 billion in taxpayers’ support, what—
Mrs Badenoch
On a point of order, Mr Speaker. I would like advice on how to counter the points the Secretary of State is making, given that they are factually incorrect and a complete misrepresentation of the situation that he inherited.
Mr Speaker
It has just been clarified by your good self. I cannot make the Secretary of State give way when you want to come to the Dispatch Box, but I am sure that if he notices you doing so again, he may wish to.
Jonathan Reynolds
This is an excellent chance to clarify that. If the Leader of the Opposition agreed a deal with Jingye to cause massive job losses in Scunthorpe and transfer the jobs to a completely different place, and at higher cost than the request the company made to us, I think she should be able to tell us. I am more than happy to give way.
Mrs Badenoch
Labour cannot negotiate. We were negotiating a modernisation deal that would have had limited job losses, just as we had in Port Talbot. The Labour Government inherited a functioning commercial deal in Port Talbot, and the same would have happened with British Steel had we not had a snap election. What the Secretary of State is doing now is the union-pushed deal. They brought that deal to me—I said no; he said yes.
Jonathan Reynolds
This is genuinely revelatory. I say again: if Jingye’s request was for £1.2 billion to build at lesser cost in one place, what was the sum of money agreed by the Leader of the Opposition when she was Business Secretary to build in two places? It certainly was not in the accounts that the Chancellor had. I will give way. How much money was agreed to Jingye to close the jobs in Scunthorpe? I ask her.
Mrs Badenoch
When you are negotiating, you do not have—[Interruption.] Labour Members are cheering and laughing because they love this; they think that the public taking on billions of pounds in liabilities is fantastic. We had not finished the negotiation so there was no amount, but it would have succeeded better than the terrible plan that the Secretary of State has now.
Jonathan Reynolds
Our friends in the press will follow that up and find out exactly how much money the Leader of the Opposition secretly promised to Jingye to transfer those jobs out of Scunthorpe. I think it might be wise, on all counts, for that statement to be withdrawn.
The situation we inherited across the board on assuming office is one where most of our foundation industries were in some substantial difficulty. Since 2010, UK crude steel production has almost halved, and we know that rebuilding our steel industry after years of neglect will be a challenge, but it is one that this Government have grasped.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
My right hon. Friend and I were in this House in 2015 when the Conservative party sat on its hands and kissed goodbye to the Redcar blast furnace and, with it, the state-of-the-art coke ovens that could have resolved this situation today. Before he sits down, will he say something about the Jingye activities at Lackenby and Skinningrove and how they will be impacted by today’s announcement?
Jonathan Reynolds
I am really grateful that my hon. Friend has been able to put that point on the record for his community, to avoid the kind of situation we have seen in lots of industrial communities, to be frank, over the years. This is why we take this action today in the national interest: to provide that bridge and that possibility to the future.
Specifically in relation to the downstream mills, even if we were willing to accept a situation in which they were supplied from a foreign country, as in this case, the confidence of consumers and businesses would surely be put at risk and it would bring into question the entirety of British Steel’s workforce and business and a huge part of our strategic assets. That, again, is why this decisive action today is necessary.
Dr Caroline Johnson (Sleaford and North Hykeham) (Con)
The right hon. Gentleman said that steel production is strategically important, and I agree. He said that we should be avoiding having to be reliant on imports, and I agree. However, his Government blocked production of the raw material metallurgical coalmine in the north-west. Will he now go back to his colleagues in Government and the company to encourage them to reapply so we can have security not just of steelmaking, but of the raw materials that are needed to make it?
Jonathan Reynolds
The hon. Lady will know that the company brought into question whether that coal was the right grade for blast furnace supplies. I remember several debates in this place about that. I should also make it clear—I think hon. Members understand this—that we are talking about two blast furnaces that date from the 1930s and 1950s. We must also be looking to the future, to new technology and new investments. Crucially, having the dedicated resources that this Government have put into steel is why we have the chance to look to the future with optimism. The UK steel industry is an outlier, in the sense that it is a much smaller proportion of our overall economy than in any major comparable economy, so of course there is potential, and we should look to the future. I would be more than willing to work with the hon. Lady as a local MP to do so.
Mr Joshua Reynolds
I thank the Secretary of State for giving way. Once he has the powers in this Bill, I urge him to use them decisively and swiftly, but then, as he has said, we need to look to the future. Once we have secured Scunthorpe’s future, we need to discuss what happens next, which is clean energy, and investing in the global clean energy that the UK really could succeed in. Does he agree that the people of Scunthorpe have upheld their end of the bargain for decades, and now it is time that we in this House make sure we uphold our end too?
Jonathan Reynolds
The hon. Member puts it extremely well, if I may say so. The people who have upheld steel as the backbone of construction in the UK for decades deserve better treatment than they would have had if Parliament had not been recalled today to take this action, and we should all bear that in mind.
Whether it is at Port Talbot, via our upcoming steel strategy, via our work to improve public procurement, or in the introduction of our industrial strategy to tackle the most thorny issues of industrial competitiveness, where others have shied away, this Government have stepped up.
Let me conclude by saying that steel is fundamental to Britain’s industrial strength, our security and our identity as a primary global power. Today’s legislation will help ensure that we can retain that steelmaking capability here in the UK both now and for years to come. For British workers’ security, for British industries’ future and—without hesitation—in our national interest, and for the workers of British Steel and their families, this action is essential, and I commend this Bill to the House.
Daisy Cooper
As the hon. Member knows, the three things that I have just outlined—British Steel being sold for a pound, British Steel entering insolvency and the Government’s Insolvency Service being left temporarily running the firm—all happened in 2019.
With Putin’s barbaric war in Europe and Donald Trump’s disastrous tariffs causing economic turmoil around the world, we must secure the future of steel production here at home. We Liberal Democrats welcome the sense of seriousness and urgency shown by the Government in recalling Parliament. We must work together to rescue our steel sector and the tens of thousands of jobs that directly and indirectly rely on it. But under the terms of the Bill, the Secretary of State is giving himself huge and unconstrained powers that could set a very dangerous precedent. I urge him to make a commitment, in the strongest possible terms, to repeal the powers that he is giving himself as soon as possible—within six months at the latest—and to come back to this House for another vote to extend those powers if they are still required after that.
Jonathan Reynolds
As I tried to articulate in my opening speech on Second Reading, I understand the gravity of the situation, which gives puts some context to the demands for further powers to be included in the Bill. The limitation, as wide as it is, is the right measure, and I can give the hon. Member my absolute assurance that I shall seek to do exactly as she says.
Daisy Cooper
I am incredibly grateful to the Secretary of State for giving that assurance, which is important in the context of what the powers in the Bill actually are.
Clause 3(4)(a) gives the Secretary of State the power to break into anywhere to seize assets. Clause 3(4)(c) gives the Secretary of State the power to take whatever steps he considers appropriate—not what a court or a reasonable person might consider to be appropriate—to seize or secure assets. Clause 4(3), on offences, makes it a crime for anyone not to follow the instructions of the Secretary of State, or to refuse to assist the Secretary of State in taking those steps without a “reasonable excuse”. However, a “reasonable excuse” is not defined in the Bill, no examples are given, and, quite frankly, it is hard to work out what defence of a “reasonable excuse” might be accepted given that, under clause 3(4)(c), it is whatever the Secretary of State himself considers to be okay.
Clause 6(1), on indemnities appears to give the Secretary of State and potentially any other person who is with him—a police officer, a civil servant, or a Border Force official—immunity from prosecution for using any of these wide-ranging powers. These powers are unprecedented and they are unconstrained. I am grateful to the Secretary of State for saying that that is precisely why he intends to repeal them as soon as possible.
More broadly, the Government must now also bring forward plans to guarantee the future of this vital sector. We know the steel industry is surrounded by crippling uncertainty. After decades of underinvestment and shocking indifference to our sovereign economic security, the previous Conservative Government have left our sovereign national capacity on steel diminished and endangered. Yet there is no chance that UK demand for steel will disappear. How absurd and irresponsible is it that we have a sustainable and enduring long-term market for British steel, but that our supply could keel over in a matter of days because of the failures of the failed Conservative party?
So looking ahead, let us remember that saving Scunthorpe is necessary, but not sufficient on its own. There have been significant discussions about the future ownership structure of this company. Given the precarious fiscal position in which the Government find themselves, it is important that all options on ownership are put on the table, so that this House can take an informed decision about what they mean for the public finances. I hope the Government will make a commitment that, in the coming weeks, they will bring forward a report that sets out options for future ownership of the plant.
Looking ahead, many big questions remain unanswered. Will the Government immediately designate UK-made steel a nationally strategic asset? Will they be using direct reduced iron, and, if so, will that form part of the UK’s plans alongside protecting the production of virgin steel at Scunthorpe? When will the Government bring forward a comprehensive plan to ensure that more British steel is used in vital infrastructure projects, from defence to renewable energy? Will Ministers work shoulder to shoulder with our European and Commonwealth partners to tear down trade barriers, including by negotiating a customs union by 2030? Will they develop initiatives to retrain and upskill workers across the country as we transition to greener methods of steel production? How do the Government intend to respond to calls from UK Steel for the Government to achieve the lowest electricity prices in Europe, parity with competitors on network charges, and wholesale electricity market reform?
This case should also raise concerns about the role of Chinese corporate interests in the UK’s national critical infrastructure. The decision by British Steel’s Chinese owners to turn down the Government’s offer of £500 million to support the future of the Scunthorpe plant has directly precipitated this crisis. We must now be clear-eyed about the risks posed by Chinese involvement in our country’s vital infrastructure. To that end, will the Minister tell the House when the Government’s promised UK-China audit will be released, and how the Government plan to strengthen protections for critical infrastructure? Can he assure the House that the Government have assessed whether there is any risk that Jingye, on behalf of the Chinese Government, has deliberately run down the plant to jeopardise the UK’s capacity to produce steel?
We are in a precarious position, and it is not as if there were no warnings. In 2022, the Royal United Services Institute think-tank said:
“Domestically produced steel is used in defence applications, and offshoring the supply chain may have security implications—for example, in a scenario where multiple allied countries rearm simultaneously at a time of global supply disruption, such as during a major geopolitical confrontation.”
The fact that Jingye has now closed down the supply of raw materials is further evidence that the plant should not have been sold to it in the first place. Quite frankly, the fact that some Conservative MPs are calling for nationalisation shows how far through the looking glass we really are.
Is not the Conservatives’ attitude abundantly clear? On national security, they cut troop numbers by 10,000; on food security, they undermined our farmers with unforgiveably bad trade deals; and on economic security, they left our country with almost no sovereign steel capacity. On security, the Conservatives left our island nation severely vulnerable, like flotsam in the sea, passively bobbing up and down or being bashed around by the tides of international events.
As for hon. Members from the private limited company Reform Ltd, they have a bit of cheek to claim to support UK steelworkers while cheering on their pal President Trump, whose punishing trade war is putting those steelworkers’ jobs at risk. Perhaps the company’s directors who sit in this House will come clean about whose side they are really on.
Time and again, we have seen the failures of an ad hoc, piecemeal approach to industry across all sectors, from the failure of our water companies to the shocking state of our housing nationally and the dismal situation of our health service. For too long, there has been no stability for these industries, which are constantly fixed on a short-term basis only, to the point where they are practically held together by string and tape and the dedicated workers who remain. We Liberal Democrats stand ready to help constructively to bring about an outcome that delivers real change.
Martin Vickers (Brigg and Immingham) (Con)
It is a pleasure to follow the hon. Member for Great Grimsby and Cleethorpes (Melanie Onn), my Member of Parliament; on this matter we are in complete harmony. Before I talk about the local situation, which is what I want to focus on, may I thank the Secretary of State for giving me a call yesterday evening and outlining the proposals he would be bringing forward this morning? I did say to him that I would not be entirely uncritical, so I am sure he will not mind a few jabs here and there.
The local situation is extremely critical, as has been pointed out. The impact, not only on the workforce but on the wider economy of northern Lincolnshire, would be extensive. I have been a resident in the Grimsby-Cleethorpes area all my life, and I have seen the impact when a town loses its core industry. In the case of Grimsby, of course, that was the deep-sea fishing industry. When that decline happens—it has happened to so many towns up and down the country as a result of the decline in mining, shipbuilding and other heavy industries—it takes a generation or perhaps more for the town to fully recover.
That is the last thing I want to see happen in my neighbouring constituency of Scunthorpe, or to the hundreds of my constituents who work there. Those Members who were here for the Easter Adjournment debate—there were a handful—might have heard me say this only four days ago, but the site extends way beyond the bounds of Scunthorpe, into my Brigg and Immingham constituency. The site is the equivalent of 1,133 Wembley football pitches, which gives an idea of its size and of the amount of work that would be needed were the steelworks to close. There would be demands for vast Government investment over decades, in order to remediate the site and to provide new employment.
I said that I would not be entirely uncritical of the Secretary of State, so I refer him to my first urgent question on this matter, on 5 September last year. I said on that occasion:
“There have been widespread media reports suggesting that coke will stop being imported from October, which would mean production would stop in Scunthorpe by Christmas. There are rumours concerning the fact that employees will be given notice very soon. That is obviously creating great anxiety among those directly employed by British Steel and those in the supply chain, which in northern Lincolnshire extends to many thousands of people and many businesses.”—[Official Report, 5 September 2024; Vol. 753, c. 424.]
Thankfully, we have had a six-month reprieve from those threats in October, but I have to say, the Government have been a little dilatory on this. I appreciate that negotiations have been taking place and Ministers cannot give away their negotiating position, but I made this point as long ago as September, as well as when you granted me an urgent question on 27 March, Mr Speaker—only a couple of weeks ago—and surely the Government were beginning to realise at that point that the negotiations with Jingye were going nowhere.
Jonathan Reynolds
I am extremely grateful to the hon. Gentleman for putting that point on the record. It is precisely because of those concerns that we were able to have ready a legal route to intervene to directly offer support to purchase raw materials. What we could not have anticipated or expected was for a company to act in an irrational economic manner when such a clear, distinctive and generous offer was made.
Martin Vickers
I thank the right hon. Gentleman for his intervention. I would say merely that he has been party to the negotiations, and he must surely have realised that the company was not negotiating in good faith and expected his officials to prepare legislation, if required, to deal with the situation that we are now in. As others have said, this is crucial not just for thousands of my constituents who work at the site, but for the defence of the nation. I assume and hope that Defence Ministers have been lobbying the Secretary of State to make their concerns clear.
Locally, there is continuing concern. Like the Father of the House, my right hon. Friend the Member for Gainsborough (Sir Edward Leigh), I will support the proposals. I floated the nationalisation issue on 27 March, and I see this as a stepping-stone to that situation. To those who will perhaps demand nationalisation today, I would say that this is a very complex issue, and what matters more than anything else is the future of the workforce and the ability to produce virgin steel. Nationalisation legislation would not, I sincerely hope, be passed in three hours; it would involve a great deal of work.
Having got themselves into this situation, the Government are now taking the right action. There has been disappointment locally—to put it mildly—that the Prime Minister did not, following my question to him only 10 days ago, take up the option to meet a cross-party delegation of MPs to discuss the situation, but now that we are where we are, I fully support the Government, and I hope that they accept the sunset clause amendment, which would be prudent. I can assure them of my full support today, which they will continue to have when they act in the best interests of my constituents.
Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)
I will try to be brief and stay focused on the Bill. Let me start by saying that we should all focus on the requirement to save the jobs of those 3,500 people who have this threat hanging over them. In fact, I understand from my hon. Friend the Member for Brigg and Immingham (Martin Vickers) that 2,500 people have already received a redundancy notice, and they will be very worried at the moment. Our thoughts should be with them today. Coming in on a Saturday is right if it saves their jobs. I am certainly prepared to vote for that.
The Bill does give vast powers to the right hon. Gentleman the Business Secretary and the Government. As others have said, I trust him personally—this is not an attack on him—but we in this House should never trust Government more than we have to. I have said this on both sides of the Chamber, by the way. I therefore urge him to have another look at the sunset clause, which I raised earlier. It is not saying, “We don’t trust you”; it is saying that sometimes Governments are taken down sidetracks, and before we know what has happened, the powers are beginning to be used for the wrong purpose. I urge him to introduce the sunset clause, or even to do so in the other place, to give the House real powers to come back. For everyone’s sake—even those on the Government Benches—I think that would be worth doing, because it would allow us to have a strong debate on how the powers are being used and would perhaps even enable us to influence what is taking place.
The reason for this debate is clearly the massively changed needs of this country, particularly after the event that we never thought would happen: Russia’s brutal invasion of Ukraine. As a result, weapons and arms are needed on an unprecedented scale, there is a plan to build up the armed forces, and they need the very high-quality virgin steel that is produced in this plant. Without it, we would have to import it. Frankly, China does not produce that quality of steel. The other reason is the tariff war now taking place, which has introduced 25% tariffs on the car industry, which is one of the biggest purchasers of steel. All those things make the Bill very much necessary.
We have another problem, which I hope the Government will deal with in the context of the Bill when they talk to the Department for Energy Security and Net Zero. Things have changed. The Prime Minister himself has said that the world has changed. We have been operating in what we considered to be a global free market. I have argued for some time that this is not a free market. Far too many countries such as China have abused the rules of the free market, subsidised their industries ridiculously and used slave labour to produce their products. When that happens, the free market is dead. We must recognise that we will have to deal with those whom we trust and who do not break the rules. That means a whole rethink of the Government’s China policy and of whether we need to rush to China for investment. We need to ensure that we deal with our industry at home and that we produce things again.
One problem is the energy costs our industry faces, which are really quite stark. Our industry is not just in competition with China; even the costs in Europe are far less now. I will give a short list. The costs in the UK are now the highest in the world, at $400 per megawatt-hour. Germany, which has the highest costs in the rest of Europe, is at $250 per megawatt-hour, while France and the others all have lower costs for producing energy. That energy is critical for the steel industry, and that is one of the big issues that the Secretary of State has to deal with. China, with its subsidies and broken free market rules, is at $60 per megawatt-hour. We should not attempt to compete with it; we must say that it is not competitive at all. [Interruption.] Exactly right, as my right hon. Friend the Member for Goole and Pocklington (David Davis) says.
Others are complaining about China right now. Countries in the far east, such as Vietnam and South Korea, are accusing it of dumping. What we have in China is something that will really hit us hard and make the Secretary of State’s job even worse: very simply, China is now suffering from the over-production of steel. Its housing industry has gone static, and that was one of the biggest users of the steel it produced. Where will that steel go?
By the way, it is no surprise that a Chinese company, Jingye, is involved. In pushing to shut down the blast furnaces in the UK, it knows that we will have to buy slab steel from China. That is not a coincidence; it is all part of the plan. That company is linked directly to the Chinese Communist party, and it is high time that we called that out. In his negotiations, the Secretary of State needs to remind Jingye that the reality is that it is not a private company. The previous Conservative Government should never have awarded it the contract, and I warned them about that. It is time for us to make sure that we deal with China at face value and do not accept the pretence that this company is private or in any way detached from its Government. That is a critical point.
There is much to be dealt with, and I urge the Government to listen to the House and to check all of this. Cheap Chinese steel is a desperate problem for us, and we need to work with other countries in dealing with it. We also need to get our costs down. On net zero, I hope that the Secretary of State will tell the Secretary of State for Energy Security and Net Zero that we cannot go on like this.
Jonathan Reynolds
This is such an important point, and I will be exceptionally brief, but the right hon. Gentleman knows from debates that he and I have been in that I am obsessed with the issue of industrial energy prices and by the very substantial rise from 2010 to 2024—a 50% real-terms increase. As I think he knows, the two fundamental issues are: first, our network charges and how we do those, which is different from other countries; and secondly, fundamentally, the marginal cost is set by the price of gas—the fossil fuel price—for the overall system. I am not completely rejecting everything that he is saying, but we must understand that key point: it is the gas price.
Sir Iain Duncan Smith
I am grateful for that, because it allows me to say something that I had not been planning to say: we sit on an island of gas, so why, for goodness’ sake, are we not drilling for it? We need it, and we will need it strategically. There is a need for strategic industry, and I agree with the Secretary of State on that. However, the issue does not stop there; it stops elsewhere, in the production of energy. I simply leave that point for him, and he can argue it with his right hon. Friend the Secretary of State for Energy Security and Net Zero.
I want to say one final thing. In the course of this Chinese company’s operations, I have talked to a number of people involved in the business, and its record on health and safety and on the abuse of the workers in the blast furnace area has been shocking. We should look into that much more carefully. The company has brought in cheap Chinese workers and pays them nothing like what it pays the British workers. Many of those workers have ended up burned and in great difficulty. I simply say that this is not a company we should be doing business with right now.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Diolch yn fawr iawn, Dirprwy Lefarydd.
Today’s legislation to safeguard the UK’s last bastion of primary steelmaking capacity is of course to be supported, but what my party cannot support is this Government’s approach to steel in the UK, which deems that steel in Scunthorpe is worth saving but steel in Wales is not. Today is a bitter day for the people of Port Talbot, where the blast furnaces have been extinguished because Labour let that happen. Job losses there will take an estimated £200 million from the local economy in lost wages. People in south Wales have been loyally voting for Labour for decades. Do this Labour Government feel proud that those votes have been paid back by Tory-style deindustrialisation in Port Talbot?
Plaid Cymru has called consistently for nationalisation, but the Labour First Minister of Wales rejected our calls and described nationalisation as “pipe dreams”. Labour in Wales was quick to mock our proposal, which we made 21 times—over and over again—in Cardiff and here in Westminster. Now it is UK Labour policy.
The Government must set out how much of the £2.5 billion steel fund will be allocated to securing Scunthorpe, and how that compares with the amount given to support laid-off workers in Wales.
Liz Saville Roberts
The right hon. Gentleman’s Government did not intervene in Wales.
Liz Saville Roberts
I will take no interventions. His Government did not intervene in Wales. Under his Government, Scunthorpe gets security; Port Talbot gets a pittance. Plaid Cymru believes that Port Talbot should and could have received equal treatment alongside Scunthorpe. That is why we have tabled an amendment to include Wales in the terms of the Bill, and to highlight that the measures we are debating today could have been used to save the blast furnaces at Tata Steel in Wales. We will not let Labour hide from the fact that it owns the decision not to intervene to save Welsh steel when it had the opportunity to do so.
Workers and communities must be at the heart of any long-term solution for the steel industry. So far, Labour in Westminster and Labour in Cardiff have worked in partnership to dispatch thousands of Welsh workers to uncertainty and hopelessness. People in Wales will not forget today. It is a day of bitter disappointment for Port Talbot.
Business and Trade
Jonathan Reynolds Excerpts(3 months, 3 weeks ago)
Written CorrectionsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Jonathan Reynolds
With permission, Madam Deputy Speaker, I would like to make a statement on the United Kingdom’s economic relationship with the United States. The UK has a strong and balanced trading relationship with the US worth £315 billion, which supports 2.5 million jobs across both our countries. This is second only to the EU, where our trading relationship is worth £791 billion.
[Official Report, 3 April 2025; Vol. 765, c. 457.]
Written correction submitted by the Secretary of State for Business and Trade, the right hon. Member for Stalybridge and Hyde (Jonathan Reynolds):
Jonathan Reynolds
…The UK has a strong and balanced trading relationship with the US worth £315 billion, which supports 2.5 million jobs across both our countries. This is second only to the EU, where our trading relationship is worth £813 billion.