Ceramics Industry

Baroness Anderson of Stoke-on-Trent Excerpts

Tuesday 8th March 2016 Westminster Hall

[Ruth Smeeth (Stoke-on-Trent North) (Lab)]

It is a pleasure to be here under your chairmanship, Mr Hollobone. It is an honour to follow the hon. Member for St Austell and Newquay (Steve Double).

I thank my hon. Friend the Member for Stoke-on-Trent Central (Tristram Hunt) for securing such an important debate. I, too, am proud to represent the potteries, the beating heart of the British ceramics industry since its birth, and I am the chair of the newly formed all-party group for ceramics. I have the privilege of representing Burslem, the mother town of Stoke-on-Trent, where—I hate to challenge my hon. Friend—a thriving pottery industry has existed since as far back as the 12th century. Today, it is the home of such fantastic British companies as Steelite, Royal Stafford and Moorcroft. Those businesses are complemented by competition from Dudson and Churchill, based in Tunstall, and are supplied with raw materials from my hon. Friend’s constituency by our very own Furlong Mills.

Those companies live up to our heritage and represent the very best of modern British manufacturing. In Middleport, home of our historic Burleigh Ware, we see the firing up of a new generation of master potters on “The Great Pottery Throw Down”, which I am delighted to announce has been recommissioned for a second series by BBC Two—I urge all hon. Members to apply for next year.

Today, more than 2,500 people are directly employed by the ceramics industry in my constituency, fuelling world demand for high-quality ceramics from tiles to tableware. The industry remains the single largest employer in Stoke-on-Trent North and Kidsgrove. It continues to innovate, invest in new technology and fulfil its commitments to green and sustainable manufacturing. While I am touching on the industry, it would be remiss of me to suggest that ceramics is only tableware and tiles. Many other products are reflected in the industry.

[Margaret Ferrier (Rutherglen and Hamilton West) (SNP)]

Raeburn Brick in my constituency is Scotland’s only remaining clay brick company, making 15% of the bricks used in Scotland—the other 85% are imported—and it operates as a highly energy-efficient company. Does the hon. Lady agree that we must do all we can to support this local employer and that, with tens of thousands of new houses to be built throughout Scotland in the coming years, it is in our economic interests to do so?

[Ruth Smeeth]

I wholeheartedly agree that investment in ceramics is as much in our national interest as it is part of our wider economic interests. Like our city, the industry has a proud past, but it could have an even brighter future if the Government are prepared to support it. My local businesses are keen to invest in research and development, to expand production and to create jobs, but a toxic cocktail of policies is creating great uncertainty. If future profits are seen to be at risk, investment will stall and our economy will suffer.

I am proud to support the British Ceramic Confederation’s EARTH campaign, which is doing vital work to bring policies to light. One such policy is the decision to confer market economy status on China, which would prevent meaningful anti-dumping measures against unfair Chinese export practices. The Government have tried to claim that granting China market economy status would not affect the ability to protect British industry and that anti-dumping measures could still be put in place, but that fails to take into account the fact that anti-dumping measures are calculated at a far lower rate for free market economies.

If China were to be granted market economy status, any anti-dumping measures placed on it would be calculated on the basis of the domestic cost of production in China, which is greatly subsidised by state support and kept lower by the cheap cost of labour employed in appalling conditions. The result would be so-called protections that in practice would be virtually worthless and nothing to stop European markets from being saturated with Chinese productions at extremely cheap prices.

[Paul Farrelly]

Does my hon. Friend agree that the industry’s concern for many years has been not just dumping from China, but counterfeiting? Many companies such as Doulton and Wedgwood have found themselves in a position where, weeks after producing new designs, professional salesmen from Chinese industrial complexes are going around Europe with portfolios of copies of their designs marketed at a third or a quarter of the price. That remains a concern.

[Ruth Smeeth]

I very much agree with my hon. Friend and would suggest that one reason we need to protect our industry is the quality of what comes out of our factories as well as the design and investment.

[Angela Smith]

My hon. Friend is illustrating perfectly why MES for China would be damaging to our ceramics industry. Our steel industry, which is already under severe stress, would also be threatened by such a move. Does she agree that the Government ought to think again about their support for MES for China, given the risk it poses of potentially permanent damage to two of our important foundation industries? As parliamentarians, we need to support both industries in their bid to create a level playing field in terms of both cost and competitiveness.

[Ruth Smeeth]

Of course I agree with my hon. Friend, who speaks with authority as one of the few Members who represents both the steel industry and the ceramics industry, both of which could be heavily damaged by China’s market economy status.

China currently meets just one of the five criteria required for market economy status, a fact that has been confirmed by the Minister. However, simply to say that China does not meet the criteria is to grossly underestimate the extent to which the Chinese economy is rigged in its own favour to the detriment of British and European industry. A recent report by the European Parliament—those may be words to avoid—concluded that state-led distortions in the financial sector are rife, that bankruptcy systems are malfunctioning and that political influence can be seen in close to 100% of China’s biggest firms. Far from being anything resembling a free market, 38% of China’s industrial assets are state owned.

Yet while the EU recognises the threat posed by granting MES to China, the Government appear to be supportive of the bid. The effect of that would be catastrophic for British ceramics and devastating to the British economy as a whole, affecting about 3.5 million jobs and up to 2% of GDP in the first two years. Import-sensitive sectors such as tiles and tableware would be especially hard hit, as they have no defence against Chinese dumping. Companies such as Johnson Tiles, based in my constituency, are at the forefront of modern production, but if we are not careful, their reward for innovation will be to be undercut in a market that they have pioneered.

It should come as no surprise that the Government have been equivocating on this issue. Their approach to China has resembled less of a negotiation than a fire sale. From steel to real estate and our nuclear reactors, the message coming out loud and clear is “Everything must go.” When it comes to supporting ceramics specifically, the Government talk a good game, but a significant proportion of the tableware used in the Department for Business, Innovation and Skills is made in China. Far from celebrating “Britain is GREAT,” the Minister eats from tableware at the Department—

[Anna Soubry]

I certainly do not.

[Ruth Smeeth]

Sixty percent of its tableware is made in China.

[Anna Soubry]

I do not normally intervene, but it is really important that we do not mislead. I certainly have never had any tableware of any origin in the Department. If I do eat there, it is a takeaway sandwich in plastic wrapping or a plastic box.

[Anna Soubry]

I accept that is wrong, but I will not have misleading information.

[Ruth Smeeth]

As a former trade union officer, I urge the Minister to try to get better terms and conditions and to eat a meal. I suggest that, for her colleagues who sit down to eat, 60% of the crockery used in the Department is made in China. That statistic was secured through a parliamentary question. When will “Buy British” be a policy and not just a slogan?

We have already seen from the devastating impact on the British steel industry of what happens when the Government sit back and do nothing to defend British jobs and trade, and we cannot afford for the ceramics industry to suffer the same fate. Our ceramics businesses are doing everything right. They just have the misfortune of living, as the Chinese might say, in interesting times. However, I am in no doubt that the industry can continue to thrive if the Government are prepared to stand up for British business.

All we ask for is a level playing field. Our ceramics industry is the best in the world, but we cannot compete fairly if state-funded Chinese companies are allowed to flood our domestic market with cheap products. For generations, the lives and livelihoods of my constituents have been shaped by the ceramics industry, as the clay beneath our towns was shaped by the potters’ hands. A world-beating industry was born in the kilns of Stoke-on-Trent and wherever we travel today we will find products proudly bearing our back stamp. We cannot let that great industry go up in smoke.

[Mr Philip Hollobone (in the Chair)]

We now come to the Front-Bench speeches. The SNP gets five minutes, the Opposition get five minutes and the Minister gets 10 minutes—not my rules; they are the guidelines for the House.