Steel Industry (Nationalisation) Bill

Third Reading

Scottish legislative consent granted, Northern Ireland and Welsh legislative consent sought. Relevant documents: 1st Report from the Constitution Committee, 3rd Report from the Delegated Powers Committee.

That the Bill be now read a third time.

My Lords, I begin by making a short statement on legislative consent. The Government engaged with all three devolved Governments as soon as possible following the introduction of the Bill. A full devolution analysis was sent to all three devolved Governments on 18 May. Since then, my ministerial colleagues and officials have engaged at pace to address the issues that have been raised.

I am pleased that the Scottish Parliament granted legislative consent to the Bill on 23 June. I thank UK Government and Scottish Government Ministers and officials for working constructively and at pace to reach that outcome before the Scottish Parliament rose for recess. In Wales, a legislative consent memorandum was laid on 1 July and a legislative consent Motion has been tabled for debate in the Senedd tomorrow. I am happy to report that the Government have been able to address the concerns raised by Welsh Ministers regarding the Bill.

If the Government did decide to exercise the powers in the Bill, we would of course want to consider the appropriate governance. If a steel undertaking which had its principal place of business in Scotland, Wales or Northern Ireland were to be nationalised using the powers in the Bill, the Government would seek appropriate involvement for the relevant devolved Government to ensure that their views were considered in discussions where appropriate. This reflects the Government’s commitment to consulting the devolved Governments where decisions impact devolved policy areas, while acknowledging that the specifics of company governance would need to reflect the specific circumstances of an undertaking.

The responsibility for the management of the company would always rest with the board, which alone would possess voting rights and the right to make decisions. This would ensure that a devolved Government could be involved in shaping how a future asset is governed, while respecting the board’s responsibility for the management of the companies. Importantly, the arrangement also recognises the Secretary of State’s ultimate accountability to Parliament for the spending of UK government funds and the running of a nationalised undertaking. As a result of this commitment, my understanding is that Welsh Ministers will be recommending that legislative consent be granted to the Bill when the consent Motion is debated tomorrow.

Bill read a third time.

If the Government did decide to exercise the powers in the Bill, we would of course want to consider the appropriate governance. If a steel undertaking which had its principal place of business in Scotland, Wales or Northern Ireland were to be nationalised using the powers in the Bill, the Government would seek appropriate involvement for the relevant devolved Government to ensure that their views were considered in discussions where appropriate. This reflects the Government’s commitment to consulting the devolved Governments where decisions impact devolved policy areas, while acknowledging that the specifics of company governance would need to reflect the specific circumstances of an undertaking.

The responsibility for the management of the company would always rest with the board, which alone would possess voting rights and the right to make decisions. This would ensure that a devolved Government could be involved in shaping how a future asset is governed, while respecting the board’s responsibility for the management of the companies. Importantly, the arrangement also recognises the Secretary of State’s ultimate accountability to Parliament for the spending of UK government funds and the running of a nationalised undertaking. As a result of this commitment, my understanding is that Welsh Ministers will be recommending that legislative consent be granted to the Bill when the consent Motion is debated tomorrow.

Motion

In Northern Ireland, the Department for the Economy laid a memorandum on 26 June indicating that consent was not currently being sought by the Executive from the Assembly. The Government regret that it has not been possible to secure legislative consent from the Northern Ireland Assembly before Third Reading. We also recognise that the pace of the Bill has made the consent process more challenging. The Government sincerely regret that we were not able to engage with the devolved Governments before the Bill was introduced. However, by its nature the Bill contains commercial and market sensitivities. Those sensitivities limited the extent to which the Government could discuss a proposed approach in advance. Since its introduction, we have sought to engage openly and constructively. In addition to official-level discussions, Minister McDonald met Minister Archibald on 17 June and offered further engagement to address any concerns and to support the legislative consent process.

Moved by

Steel is a vital industry for the whole United Kingdom. This Government are determined to secure the future of UK steel-making capability. For that reason, it remains important that the Bill extends to all parts of the United Kingdom, notwithstanding the present position on legislative consent in Northern Ireland. I beg to move.

That the Bill do now pass.

My Lords, steel has shaped our nation’s history. It has built railways, bridges, factories, ships, homes, energy infrastructure and defence capability. It remains essential to our future—to growth, resilience, national security and the critical infrastructure on which our country depends. This legislation is one part of the Government’s wider commitment to the steel sector. It gives us the tools to act decisively if strategic steel-making capability is at risk. It supports our objective of restoring confidence, protecting jobs, strengthening domestic capability and securing a sustainable future for UK steel.

I express my sincere gratitude to noble Lords from across the House who have contributed to the scrutiny of the Bill. In particular, I thank the noble Lords, Lord Sharpe of Epsom, Lord Hunt of Wirral and Lord Fox, for the constructive, professional and friendly way in which they have engaged throughout. I am genuinely grateful. I also thank other noble Lords who have spoken with deep knowledge of industry, constitutional practice, devolution, public finance, workers’ interests and the wider economy; their contribution has helped ensure that this House has done its job properly. Finally, I thank the Bill team, my private office, officials from across government, the devolved Government officials who have engaged with us, parliamentary counsel and the House authorities for their work in supporting the passage of this legislation at pace and under considerable pressure.

This House has sent a clear message. The United Kingdom must be able to act when a strategic industry is at risk. We must protect steel-making capability, support workers and communities, and safeguard the critical supply chains on which our national resilience depends. I beg to move.

My Lords, I thank my noble friends Lord Sharpe of Epsom and Lord Redwood, and the noble Lord, Lord Fox, for their considerable contributions and the expertise they have demonstrated throughout our consideration of the Bill. I also pay tribute to the two committees of this House that have contributed so much to our understanding of this urgent matter in their excellent reports—the Constitution Committee and the Delegated Powers and Regulatory Reform Committee.

I also extend my thanks to the noble Lord, Lord Leong, the Minister, who has taken a very close interest throughout not only in the case for the Government taking the action that they have but in understanding our concern on a number of aspects. I thank his officials and the Bill team for all their hard work. Although significant differences remain between us, the Minister has always engaged constructively with concerns raised on all sides of the House, and I believe that the Bill has been improved as a result of that engagement.

Working together, we have secured a more credible sunset mechanism: any extension of the principal transfer powers will be limited to two years and will require the affirmative approval of both Houses. We have secured provisions requiring the Secretary of State to consider the likely costs before exercising the share transfer power or the property transfer power. We have also ensured that the relevant environmental, pension, and health and safety liabilities must be properly reflected in the independent valuation process.