UK Steel Welcomes Outcome of UK Spending Review
UK SteelThe Manufacturer

UK Steel Welcomes Outcome of UK Spending Review

UK Steel Director General Mr Gareth Stace, while commenting on the outcome of the Spending Review, said “Today’s Spending Review announcement is to be

UK Steel Director General Mr Gareth Stace, while commenting on the outcome of the Spending Review, said “Today’s Spending Review announcement is to be cautiously welcomed, addressing as it does key high-level priorities of jobs, infrastructure, and innovation, but further steps are required. With COVID-19 still causing unprecedented damage to the UK economy, manufacturing, and steel demand, it is vital that the key measures set out today to aid recovery are translated in detailed, practical action on the ground, and are built upon in next year’s fiscal events. Most importantly, today’s long-awaited National Infrastructure Strategy, and the promise of GBP 100 billion spending next year, must be rolled out in a manner that ensures these projects maximise support for jobs and economic growth in the UK. Elsewhere in this review, the Chancellor has made it abundantly clear the urgent need to help people back into work through the Plan of Jobs and the Restart Scheme. However, the Government must also recognise and unleash the full potential of infrastructure projects to support British industry and its workers. The huge levels of promised infrastructure spending must now deliver the largest possible return for taxpayers’ money by maximising the UK content of these major projects, including UK-made steel. We call upon the Government to urgently work with the steel industry now to make this a reality, building UK infrastructure from UK steel."

He said “Elsewhere, promised spending on decarbonisation has the potential to help the steel sector on its road to net-zero, but worryingly there is again no detail on measures to provide cost-competitive electricity prices for the sector that will fundamentally underpin this transition. Critically, the funding for carbon price compensation comes to an end this year, and without renewed funding, the sector will face additional costs of over GBP 30 million. Steel producers already face higher electricity prices, where their costs are almost GBP 50 million higher every year than their German counterparts. It is critical that the Government immediately confirms a budget for this essential scheme next year."

Mr Stace added “We welcome the Chancellor’s announcement on a GBP 15 billion investment in R&D next year. The future of the steel sector rests heavily on continued innovation of our products and processes, and today’s announcement has the potential to help us do just that. It is critical that the Government now moves swiftly to create a UK Research Fund for Steel – filling the gap left by our exit from the European scheme at the end of the year. Crucially, the money required to do this is already there, with GBP 200 million in industrial levies paid by UK steel companies set to be returned to the UK by the EU next year."

UK Prime Minister Mr Boris Johnson outlined his Ten Point Plan for a Green Industrial Revolution covering clean energy, transport, nature and innovative technologies. The plan, which is part of the PM’s mission to level up across the country, will mobilise GBP 12 billion of government investment to create and support up to 250,000 highly-skilled green jobs in the UK, and spur over three times as much private sector investment by 2030. At the centre of his blueprint are the UK’s industrial heartlands, including in the North East, Yorkshire and the Humber, West Midlands, Scotland and Wales, which will drive forward the green industrial revolution and build green jobs and industries of the future.

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