Previous SectionIndexHome Page

Mr. Deputy Speaker: Order. We must not have these continual sedentary interventions—

Mr. Caton: A range of issues—

Mr. Deputy Speaker: Order. That applies to Members on both sides of the House. I call Mr. Caton.

Mr. Caton: I apologise, Mr. Deputy Speaker.

It is a shame that, instead of discussing those issues, we are discussing an untenable thesis that attempts to shift responsibility for last year's steel closure programme to the Labour Government. That is clearly unfair to the leadership of my party. I guess that that is politics, or at least a sort of politics; but it is a travesty of history, as was demonstrated by my right hon. Friend the Member for Newport, East (Alan Howarth) and my hon. Friend the Member for Blaenau Gwent (Llew Smith). It also does a grave disservice to the steelworkers and their families who were victims of the mismanagement and intransigence of Corus.

I speak as the representative of some of those whose lives were shattered by the announcement of the closure programme just over a year ago. The Bryngwyn works, in Gorseinon in my constituency, was the smallest target on the hit list of Sir Brian Moffat, chair of Corus; but it employed 127 people, and its closure—which ended 100 years of steel making in Gorseinon—has had a real impact on the village and the surrounding area.

Last February and March I spent hours in the Bryngwyn works and in trade union offices in Swansea talking to workers and their representatives, with our local Assembly Member Edwina Hart and with local councillors, trying to put together a strategy that could have saved the plant. The work force came up with proposals—painful ones from their point of view, which would have meant the acceptance of some job losses and the mothballing of one production line to reduce costs and keep the works going until the wheel turned full circle and steel production was more profitable—but those proposals were rejected out of hand by the Corus management.

5 Mar 2002 : Column 200

I said that I spoke as a representative of those affected by the closure. I also speak as a member of the Select Committee on Welsh Affairs, which engaged in two gruelling evidence sessions with Sir Brian Moffat and members of his management team.

Mr. Llwyd: I was a member of the Committee too.

Mr. Caton: Indeed, and I suspect that the hon. Gentleman will concur with my interpretation of what happened.

What became clear during those sessions—ironically, the first took place on St David's day and the second on the day after May day—was that 6,000 people in Wales and on Teesside would be sacked come hell or high water, and that nothing that government at any level could offer would change the decision. All the things that Corus had moaned about in the preceding months—the climate change levy, the comparative values of the pound and the euro, its demand for great rebates—were no longer key factors. Corus had decided that it could not export, and that demand from United Kingdom home markets was inadequate. To improve its stock-market value it wanted to downsize, and to downsize quickly.

When we asked Corus why it had paid £700 million to shareholders when British Steel merged with Hoogovens, it said that that was to make the merger fairer in terms of the cash that each side brought to the marriage. When we asked why, if it had needed to dispose of cash, it had not invested it in the UK steel industry—this, I think, is relevant to points made by Opposition Members about variations in European rules to allow investment aid, and they may find Sir Brian Moffat's answer instructive—we were told that the last thing the industry needed was more investment. But when I asked what Corus was doing with a laminator process from Bryngwyn after its closure, the management representatives admitted that it was over 30 years old and redundant.

That is typical of the company's failure to invest to improve quality in plants such as Bryngwyn, but it was only the first in a list of failures that we heard about during our two sessions. We heard of its failure, after the merger, to honour its commitments to maintain the then current configuration of plants, and to maintain and improve market share; its failure to engage and involve its work force and its representatives at any stage and any level when the new strategy was being developed; its failure even to discuss with the Iron and Steel Trades Confederation the possibility of letting a union-led consortium take over Llanwern and bring a new initiative to steel production on the site; and its failure, even at the end, to take seriously an alternative proposed for all the plants involved—presented by the unions, and backed by the Government and the National Assembly for Wales—that would have involved access to European Union and Government money to help maintain production for at least another year. Corus rejected that proposal, but admitted under questioning in the Select Committee that it had never even costed it.

The company's overall failure also included a failure to listen to Government and to explore with Government, either at Assembly or at UK level, ways of saving jobs. Even so, under questioning Sir Brian Moffat acknowledged that he had been told by the Prime Minister that the Government would help in any way they could.

5 Mar 2002 : Column 201

It is just plain wrong to blame the Government for what has happened. Government at various levels is trying to pick up the pieces, as my right hon. Friend the Secretary of State pointed out. I pay tribute to those who have contributed to the £4 million regeneration programme in Gorseinon—

Mr. Evans: As the hon. Gentleman will know, Allied Steel and Wire, which employs more than 1,000 people in Wales, is complaining about the climate change levy. What representations will he make to his Chancellor of the Exchequer before the Budget statement about its removal?

Mr. Caton: I shall make no such representations. I strongly support the levy. In certain circumstances when industry has specific problems—as was the case with Corus—the Government have reduced it. As Sir Brian Moffat told us, however, the levy was costing £8 million at a time when there was talk of a loss of £1 million a day. It was not a significant factor. At one stage there was an attempt to build it up into a significant factor, and the Conservative party jumped on it, but it was not the major issue.

Mark Tami: I had discussions with the unions at Shotton, which spent weeks preparing alternatives to the proposed job losses. The management of Corus took just five minutes to look at those proposals and reject them out of hand. It was a cruel pretence for Corus to go through the process when it had no intention of giving serious consideration to any of the alternatives. It had made up its mind, despite all the good efforts of unions and Government to find a solution.

Mr. Caton: That was exactly the experience we had with Gorseinon, and I am sure that every steel plant facing closure or cuts had the same experience.

Llew Smith: My hon. Friend said that during cross-examination of Sir Brian Moffat he had asked questions about the moneys handed out to shareholders. Did he have an opportunity to raise the subject of the moneys appropriated by Corus from the workers' pension fund, and did he have an opportunity to remind Sir Brian that much of the fund had been built up when the steel industry was in public ownership, and that it had therefore been appropriated from taxpayers?

Mr. Caton: We did not focus on that in the Select Committee, but I have often heard my hon. Friend explain what went on. It was an absolute crime, and he is right to focus on it.

I hope that lessons have been learned from last year's experience. I certainly welcome the investment at Port Talbot mentioned by my hon. Friend the Member for Aberavon. I think, however, that lessons will never be learned from history if we allow it to be distorted. That is one reason why we should reject the Tory-supported Plaid Cymru motion.

6.29 pm

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy): I shall begin by referring to the fine speech made by my hon. Friend the Member for East Carmarthen and Dinefwr

5 Mar 2002 : Column 202

(Adam Price). [Interruption.] The hon. Member for Conwy (Mrs. Williams) laughs, but she was not here to hear it. That is how interested she was.

Mrs. Betty Williams (Conwy): On a point of order, Mr. Deputy Speaker. I should like to point out that I was present to hear the speech from the hon. Member for East Carmarthen and Dinefwr (Adam Price).

Mr. Deputy Speaker: That is not a point of order for the Chair.

Mr. Llwyd: If I have misled the House, I apologise.

My hon. Friend the Member for East Carmarthen and Dinefwr made a powerful speech. We must remember that it was he who discovered the trail of deceit from Mr. Mittal to No. 10 and back, the various favours and the less than truthful accounts that have been given. It is clear that the interests of one party have been put above those of the UK steel industry. The speech was full of passion, and I congratulate my hon. Friend, and my researcher Alun Shurmer, on their hard work and research.

The Secretary of State made a rather desperate start to his speech. He wanted to refer to education, health and transport, among other devolved matters. However, by praying in aid such matters so that he would not have to refer to Mittal, he caused us to go around the trees and the woods. We discussed everything. I have a high regard for the right hon. Gentleman, but it was a desperate start.

The Secretary of State assaulted Plaid Cymru, of course, for raising the issue. Uncharacteristically, he attacked us over our participation in the House. That was interesting. We are here far more often than he is. The latest figures show that all Plaid Cymru Members have voted more often then he has recently, so I object to what he said.

The Secretary of State may have been a bit peeved to have received the hospital pass. He did not want to deal with the debate, any more than I should like to play against England at Twickenham in a few weeks. The right hon. Gentleman struggled valiantly, and made a valiant effort, but without any real success. He started in a hole and kept on digging: in the end, we lost him altogether.

A sort of explanation or apology was made for what went on—a clever bit of historical revisionism about what Corus did. The Secretary of State made it clear that the ISTC is worth listening to, but that the GMB and other unions are not, because they say things that are not favourable to the Government. That is another classic case of revisionism. The right hon. Gentleman referred to the Soviet Union, where revisionism was big. It may be coming back into fashion with new Labour.

The point is that Mittal gave money to the Government, and the Prime Minister wrote a letter. When the ISTC gave money to the Government, it had to write a letter. It was a rather desperate attempt to bail out this discredited Government.

If the Sidex deal represented so much benefit to Britain—and I accept that assisting Romania was a laudable objective—was it right that the British taxpayer had to pay for Romanians to come here and sign the deal? The Prime Minister explained that he wrote the letter because it was already a done deal. Where is the logic in that? Moreover, Romania has open government, and the

5 Mar 2002 : Column 203

Romanian Government's website makes clear what the letter said. It was patently obvious to all at the time that Lionel Jospin was in Romania to argue on behalf of the French company. That company has better British credentials than the Romanian firm.

In any event, it was not a done deal. The Prime Minister misled everyone in that regard. We were told that LNM was a British company, but clearly it was not. The French company was far more British, according to the definition used.

I listened carefully to the hon. Member for Maldon and East Chelmsford (Mr. Whittingdale). He dissected what had happened, and referred to the deletion of the word "friend" from the draft of the original letter. We do not know who did that, although the "Today" programme said that it was no less a person than Mr. Powell. The hon. Gentleman referred to a speech in the Welsh day debate by the hon. Member for Ribble Valley (Mr. Evans), which mentioned steel in Wales. I did not speak about the matter then, as I knew that this debate was coming, but there was no mention of steel when the Ministers replied to that debate. That shows how deep their conviction was that day.

The hon. Member for Maldon and East Chelmsford spoke about the Irish Ispat company. He described how it owed millions of pounds to people everywhere, including in these islands. He noted that it sacked 600 workers without a by-your-leave only a fortnight after promising to adhere to a five-year contract. I do not think that the company is a good employer.

However, the main thrust of the speech from the hon. Member for Maldon and East Chelmsford had to do with the culture of cronyism that pervades the Government. It is obvious to all that the Government keep the door wide open for people with money. That perception grows as day follows night. We need a full and independent inquiry into what happened.

The right hon. Member for Newport, East (Alan Howarth) tried to show that he and other hon. Members had been active during the Corus debacle. I have no doubt that he was. Who am I to doubt the sincerity of those Members? However, I was a member of the Select Committee on Welsh Affairs when we took evidence. The big question is, where were the Government for the two years before the Corus announcement was made? In that time, it was known that Corus was losing millions of pounds each month. Why did the Government not intervene when something could have been done?

I well recall one Welsh debate about three and a half years ago when the previous Member of Parliament for Caernarfon stated that Corus was in great difficulty and that we should concentrate on it. In response, Labour Members called him a scaremonger and a whinger—the usual stuff. That was a disappointing response, and nothing was done as a result.

My point is that it was all very well for the Government to jump in and act when it was too late, but where were they when they could have been doing something effective? They have acted too late, and done too little.

I also want to correct a factual inaccuracy in the speech of the right hon. Member for Newport, East. Corus joined the European Commission in opposing any action to impose tariffs as a safeguard, but it supported later

5 Mar 2002 : Column 204

objectives. The right hon. Gentleman contended that the company had been in the US, arguing for tariffs. I am afraid that that is not correct, according to my information.

Next Section

IndexHome Page