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. The arrangements will operate from tomorrow, 1 July, and taken together will serve to protect the operation of the UK internal market and flows of goods within it. His Majesty’s Revenue and Customs is now taking steps to confirm the arrangements with industry, including business representative organisations in Northern Ireland. The Government will continue to provide guidance and support to traders moving goods from Great Britain to Northern Ireland through the trader support service, and we will work closely with the EU to ensure that these arrangements operate effectively in practice. We are doing two things. First, we are protecting the UK internal market; secondly, we are giving UK steel production the protection it needs so that we have strong UK steel production that is able to meet at least 50% of the UK’s steel needs.

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. Seventy-three per cent of steel imports into the whole of the UK, which includes Northern Ireland, are completely excluded from the measure, and the tariffs only apply above the quota levels. For many categories, we have managed to create quota levels that are above existing trade flow levels, so I do not expect there to be problems in those. But in some areas we are deliberately trying to make sure that people use British steel, because Britain now produces only 4 million tonnes of steel. If we do not continue to make steel in this country, a significant problem will accrue to us into the future.

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? Finally, may we have an update on the negotiations the Government are having in this area with the US and India, because it seems that whenever the UK Government negotiate on behalf of our steel industry, the industry loses out? This is all shaping up to be a disaster for steel, and we would appreciate an update.

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. The truth of the matter, as I have said before and as we have said repeatedly to many others, is that it would be much more sensible if there was an exemption between the UK and the EU in relation to steel measures, so that neither of us was facing quotas or tariffs, because frankly we are not the problem for each other. There is a danger that in specific instances, some companies might facing tariffs going in both directions, such as Marcegaglia, which is a part-Italian, part-British steel manufacturer. I just want to correct one other thing. The hon. Lady has repeatedly said on her X account that there will be a 50% tariff on all steel imports. This is patently untrue, and I really hope that she starts correcting the record.