British Government in Catch 22 Situation over Steel Safeguards
With just 6 days to go, The Star reported that several elected British leaders of constituencies with steel mills have called for an urgent reform of trade laws to protect UK’s steel industry from unfair global trading practices. Conservative MP for Penistone and Stocksbridge, which is home to Liberty Speciality Steel, Ms Miriam Cates in a speech in the House of Commons, called the decision by an independent body to remove nine safeguards incomprehensible and said that the Government does not have the legal powers it needs to prevent this from happening. She said “Steel supports hundreds of jobs in Stocksbridge, and is vital for our local economy. We simply cannot afford to lose these important protections when the EU and US are keeping their safeguards in place. This is a complex legal issue, but one that must be resolved urgently to avoid potentially devastating consequences."
Sheffield Central’s Labour Party MP Mr Paul Blomfield wrote to Prime Minister Mr Boris Johnson urging him to protect the industry saying cheap foreign imports could undercut Sheffield’s steel production. He said “Margaret Thatcher destroyed thousands of steel jobs in Sheffield, David Cameron pulled planned support for local steel producers, and now Boris Johnson is betraying remaining steel producers. It’s putting their ideology of free trade at any price before British jobs. So while the EU keeps these safeguards for their steel producers, the UK government are failing to do the same, making us doubly vulnerable as the target for cheap foreign steel.”
In Rotherham, Labour Party MP Ms Sarah Champion said that she fears for the future of the Liberty Narrow Strip Mill in Brinsworth if the protections were dropped. She said “The Government is gambling with the future of steel workers in Rotherham should it allow safeguards to lapse. This is the first real test of Britain’s independent trade policy following Brexit, but rather than using its new-found freedom of action to defend this vital strategic industry, it stands to be thrown to the wolves.”
Labour MP for Slough & Shadow Rail Minister Mr Tanmanjeet Singh Dhesi said that “It is essential for the UK government to extend steel safeguards beyond their June 2021 expiry date, or we risk job losses and endangering this treasured British industry. British made steel is one of the pillars that built this great nation to what it is today, contributing GBP 2 billion to the UK economy in 2020 alone. The British steel industry produces enough for 70% of the UK’s annual requirement of crude steel each year. With 96% of it used in construction and infrastructure recycled and used, over and over. Yet, for 11 years, this Conservative government has failed to understand the strategic importance of the UK steel industry. UK now risks the real prospect of leaving our own steel industry needlessly exposed.”
Grimsby Telegraph separately reported that Scunthorpe’s Conservative MP Ms Holly Mumby-Croft met British Prime Minister Mr Boris Johnson to discuss steel safeguards and press for changes to steel safeguard removal recommendations. Speaking after the meeting, at which the chair of the All Party Parliamentary Group on Steel was joined by neighbouring fellow Conservative MPs Mr Andrew Percy and Mr Martin Vickers, she said “Today I joined other steel MPs in meeting the Prime Minister to voice our significant concerns regarding the independent TRA's recent recommendation on steel safeguards. The Prime Minister has assured us that he shares our commitment to the future of the British Steel Industry. We hope to have more to say on this in the coming days and weeks - I will, of course, continue to press him and the government on this important issue. The Prime Minister remains an ally of steel, having ensured that his government paid the salaries of steelworkers in Scunthorpe for months following the collapse of the previous owners."
Labour Party’s attempt to force emergency legislation through to extend current rules beyond their June 30 expiry while the issue was revisited was thwarted in a Commons vote earlier this week by 355 to 271 votes.
UK’s Trade Remedies Authority, which made the decision, is independent of government and the UK’s Secretary of State for International Trade can only accept the recommendations in full or allow all 19 protective measures to fall instead. The Secretary of State does not have the legal power to amend the recommendations or to extend the existing safeguards against the TRA's recommendations. A spokeswoman for the Department of International Trade said “Rejecting the TRA’s recommendation would mean all 19 of the product categories within the safeguard measure expire on 30 June, even the 10 the TRA recommends the UK should keep. Any forcing through of legislation in order to disregard the TRA recommendation, which is based on evidence provided by interested parties including importers, domestic producers and overseas exporters, would breach World Trade Organization rules, leaving us open to challenge and retaliation.”