Steel Tariffs: Northern Ireland

(Urgent Question): To ask the Secretary of State for Business and Trade to make a statement on steel tariffs in relation to Northern Ireland.

I hope you would agree, Mr Speaker, that I have always done my level best to come to the House first with any new announcements.

As I told the House last Thursday in written and oral statements, the Government’s new steel trade measure comes into force tomorrow, immediately succeeding the expiry of the steel safeguard, ensuring that there is no gap in protection for our domestic steel industry. The European Union has today also announced the details of its trade measure, which comes into force tomorrow. Since the announcement of its measure on 7 October last year, we have engaged extensively with the EU and agreed an approach that reflects the UK and the EU’s highly interconnected supply chains. This will provide stability for UK-EU steel trade from 1 July while we continue to work together to strengthen UK-EU steel trade for the longer term.

As Members would expect, our engagement has also covered the matter of Northern Ireland in some detail. This ensures that specific arrangements are and will be in place to facilitate the continued smooth movement of steel to Northern Ireland from Great Britain, guaranteeing that movements of steel within the UK market will not pay EU tariffs. These arrangements, which are aimed at comprehensively protecting the UK internal market, include the retention of the seven tariff-rate quotas—for categories 7, 8, 9, 13, 17, 25A and 28—and specific arrangements for other categories that will continue to mean that UK-origin steel can move tariff-free to Northern Ireland.

I am grateful to the Minister for coming to the House. I have to say, there is an inherent absurdity, and indeed a constitutional offence, in having to come to the sovereign Parliament of the United Kingdom to ask whether there will be any tariff arrangements on moving steel from one part of the United Kingdom to another. Indeed, one recalls that last Thursday, the Minister said that he could not tell us because he had to await the EU decision, which underscores how absurd it is that these matters are governed by a foreign jurisdiction and not by ourselves.

I have three specific questions for the Minister. First, is there any quota differential in regard to any class of steel, and if so, in respect of which classes?

Secondly, will the EU’s new traceability rules, which it calls the “melt and pour” rules, be applied to steel being imported into Northern Ireland? If they are, they will impose an extra layer of bureaucracy, with form filling and certificates having to be obtained that are not required when steel is brought into Great Britain. Could we have clarity on that?

Thirdly, last Thursday the Minister said that 74% of steel imports to Great Britain will not be covered by the UK trade measure. Can the same be said of Northern Ireland? Is it the same level of exemption—if we want to call it that—in respect of Northern Ireland, given the import of the EU governance? I ask those questions because in Northern Ireland we do not make steel; we rely exclusively on importing it. Many businesses in Northern Ireland depend very much on steel imports, yet here they are facing a new regime tomorrow and only hearing about it today.

I am sorry, but I think that the absurdity all lies with the hon. and learned Member. He seems to be trying to create a difference between Great Britain and Northern Ireland, which we are striving in every way to prevent. We have made it absolutely clear that the existing—[Interruption.] If he chunters from his seat he will not be able to hear what I am saying; I might be able to enlighten him.

There are seven key categories that are most important to Northern Ireland. Category 7—steel plate—is important for shipbuilding and defence. Category 8—stainless, hot-rolled sheets and strips—is important for automotives. Category 9—stainless, cold-rolled sheets and strips—is also important for automotives. Category 13—rebar—is important for construction. Category 17—steel beams—is also important for construction. Category 25A—large tubes—is vital for the oil and gas industry. Category 28 —alloy wire—is important for fencing.

In all those categories, we have maintained the tariff-rate quotas. There is no difference. From the initial conversations I had with the European Union back in December last year, we have made it absolutely clear that we want to make sure that there is a single market between Great Britain and Northern Ireland and that there is no border down the Irish sea.

All this shows the patent nonsense of having left the European Union. I know that the people of Northern Ireland agreed with me on that and disagreed with the hon. and learned Member. The truth is that we would not have to negotiate with the European Union on these matters if we were still a member, and there would not be any of these quota issues. It is true that there is a problem with overcapacity of steel around the world, but the UK is not the problem for the EU, and the EU is not the problem for the UK, so, frankly, we should come to a very sensible arrangement. That is what we have mostly managed to do so far, but we will continue to discuss it with the EU.

I thank the hon. and learned Member for North Antrim (Jim Allister) for bringing this important urgent question to the Chamber. I welcome the Government’s ambition on British steel, but British Gypsum in my constituency has raised concerns about the short-term impact of tariffs and called for transitional arrangements for steel to avoid unintended consequences in the construction industry. Will the Minister comment on the idea of better, stronger transitional arrangements?

As I explained last Thursday, we have introduced transitional arrangements to make sure that for the first quarter, imports are possible where people already have contracts to bring stuff in. As I say, 73% of UK imports of steel will not be in scope of the measure at all and can come into the UK easily. We are simply trying to make sure that for the categories of steel that we produce in the UK, people turn to British production. That is the way in which we can ensure that we still have strong steel production in the UK into the future. If my hon. Friend has specific issues relating to a company in his constituency, I am very happy for my officials to meet with them.

I call the shadow Minister.

I congratulate the hon. and learned Member for North Antrim (Jim Allister) on securing this urgent question. The Conservatives have made clear for a number of weeks how concerned we are about the incoming steel tariffs that will take effect tomorrow. We have heard from businesses, not just in Northern Ireland but across the country, that the 50% tariff on steel imports above the quota will do great damage to upstream British manufacturing, our defence and aerospace sectors, and those who construct the nation’s infrastructure.

We acknowledge that on Thursday the Government brought forward some changes to the quotas after reflecting on concerns raised by industry, but we have now heard at the last minute that the EU has cut a significant chunk of the UK’s export quota. Businesses have been warning us for months about the damage that these proposals could cause, and they are now expected to adapt in a matter of hours, not days. Will the Minister publish the full impact assessment and communicate properly with the affected sectors? He mentioned a few ways in which he is going to communicate with them, but I cannot stress enough the urgency of getting clarity for every business across this country in the upstream steel industry.

Have any Northern Ireland businesses specifically lodged applications with the Trade Remedies Authority? I know that the Minister for Industry, the hon. Member for Stockton North (Chris McDonald), has kindly let us know that he cannot attend oral questions on Thursday as he will be visiting businesses in Northern Ireland. Is that to do with the serious concerns over steel tariffs?

I will start with the question about the Minister for Industry and his visit to Northern Ireland. He is visiting shipbuilding and aerospace companies. The visit does not specifically relate to steel at all.

On steel generally, the Conservatives’ record is absolutely shocking, and we will not be going down the route that they went down. When they came to power in 2010, the UK was producing 12 million tonnes of steel, and when they left power we were producing 4 million tonnes. That is an existential crisis that happened entirely on their watch. We need to address it, and we are serious about doing so.

Incidentally, countless contracts for major infrastructure projects in the UK that were awarded by the previous Government, including through the Ministry of Defence, regularly went to steel produced in other countries. I am not going to follow the route that the hon. Lady’s party went down. In fact, the then Prime Minister even refused to meet with steelworkers. That shows the level of concern that the Conservative Government had with steel. We are determined to make sure that we have a proper steel production industry in the UK, and that means that we have to take some tough measures.

In relation to the European Union, to be fair to the hon. Lady, she was not a leaver. She was in favour of remaining in the European Union. The UK has now secured 1.05 megatonnes of guaranteed access through country-specific quotas and 1.09 megatonnes of access through competitive pools—a total access of up to 2.14 megatonnes through the EU process. UK steel exports to the EU averaged 1.82 megatonnes between 2022 and 2024 when including products covered by the EU steel measure, so we did end up with a good result.

I thank the Minister for his work and engagement on this issue over the last few weeks and months. I have been contacted by a range of defence and aerospace companies both in my constituency and across the UK—including some with a footprint in Northern Ireland—that are concerned that some of the quotas and exclusions do not take into account some of the relevant codes suggested by industry, which could lead to increased costs, project delays and threats to jobs in the future. Will he assure me that he will meet the industry again to discuss the codes that it feels are outstanding? Will he or his officials meet me to discuss this issue in more detail?

I have regularly and repeatedly met industry downstream and producers—I did so again yesterday—as has my hon. Friend the Under-Secretary of State for Business and Trade, the hon. Member for Stockton North (Chris McDonald), the Minister for Industry, who is sitting by my side. We have striven at every point to ensure that where possible we are including only those categories of steel that are manufactured in the UK. One of the reasons we changed the quotas in what we announced last week from the original suggestions made in March was that Speciality Steel is not up and running and therefore it is not able to supply some of the categories that my hon. Friend spoke about. In many areas, the quota is larger than existing trade levels. Yesterday afternoon, a variety of MPs came to meet me and officials to talk this through, and I am happy for my hon. Friend to meet my officials if he has specific concerns for constituency businesses.

I call the Liberal Democrat spokesperson.

Businesses across Northern Ireland and the rest of the United Kingdom are concerned that from tomorrow they may face tariffs on the steel that they are importing even if that steel is not manufactured in the United Kingdom in the quantities or grades they need. The Under-Secretary has requested that we write to him with specific examples, and I did so on 19 June on behalf of Hewland Engineering in my constituency, but it is concerned that it has not heard back yet and 1 July is coming quickly.

The Minister mentioned in his response to the urgent question that he was working hard to ensure a single market in this area between us and the European Union. The Liberal Democrats are really grateful to hear that, because we have long argued that this friction is an inevitable result of our leaving the European Union and the single market. Will he help support the Liberal Democrats’ campaign to ditch the Government’s red lines and have a new, bespoke UK-EU customs union, along with joining the single market for our new growth and defence partnership with the EU, to help protect British companies and help get Britain growing again?

He’s a cheeky one! No, I am not going to sign up to the Lib Dem campaign. However, there is a serious point here: it would be much better if the UK and the EU were to have a mutual exemption in relation to quotas and tariffs in this area. I have made the point already, but I will make it again: we are not the problem for EU steel manufacture and it is not the problem for us. The real problem is about overcapacity, and all the countries in the world that are facing this same issue should be joining together to try to tackle it.

I was asked a question about the Trade Remedies Authority. I am not aware of a particular company in Northern Ireland having approached anybody about whether a TRA investigation should be launched, but certainly there are areas where steel production in the UK could look at whether a trade remedy ought to be sought.

The world has moved on and we no longer live in a free trade utopia, as some might wish. It is clearly difficult to impose protections for our steel industry, but it is the right thing to do. Does the Minister agree that failing to impose such protections would surrender our steel industry, surrender our national defence and surrender our sovereignty to other nations, which can never be acceptable?

Of course I agree with my hon. Friend. I am, broadly speaking, in favour of free trade, but it has to be free and fair trade, and one of the issues in relation to overcapacity in steel is that there is not a level playing field across the world because of subsidies and anti-competitive practices that make it impossible for UK steel to compete. It is an existential moment.

I have heard from some Conservatives that there has been an argument that we should delay introduction of the measure or that we should have lower tariffs or whatever. The truth of the matter is that, with the EU already implementing its measure, along with the US and Canada, if we were not to implement a similar measure, the danger is that we would be the dumping ground for all the cheap steel in the world, which would kill stone dead every single steel mill in the UK. This is not a Government who will put up with such a strategy.

The Minister may have met representatives of the industry, but the question is: has he even listened to their concerns? They still say that the problems caused by his imposition of tariffs will abide with the industry. He said that he is relying on UK producers to be able to produce steel, but Tata has said that it will not be able to supply all the steel required, and one of the firms in Rotherham that he is relying on is in administration. How can he say with assurance that the supply of steel will be available?

The question for Northern Ireland is this. If Northern Ireland producers have to bring steel from the UK, they need first to be sure that the UK quota has not been exceeded, so will the Minister assure us that they will not have to be concerned about whether there is any EU quota left? Otherwise, they may have to pay tax twice.