Mark Tami MP signed the UK Steel Charter at an industry event in Parliament last week. Also signing up was Business Minister, Andrew Stephenson MP, who signed the Charter on behalf of the Department for Business, Energy and Industrial Strategy. Welsh Government and Scottish Government have also signed the Charter in recent weeks, along with a number of local authorities.
Commenting on signing the UK Steel Charter, Mark Tami MP said:
“It is a real pleasure to sign the UK Steel Charter and give my support to this vital industry. The steel industry is not just a vital cog in Flintshire’s economy, it also supports communities across the entire country.
“A strong UK steel industry is essential for the UK. Other key strategic sectors in the UK like automotive, construction, and engineering all reap the rewards of a steel industry doing well. It’s so important that we do what we can to encourage the use of steel from the UK and that’s why I would encourage local businesses to consider signing up to the UK Steel Charter.”
The UK Steel Charter is a new initiative aimed at maximising the amount of UK produced steel used in UK construction and infrastructure projects. With just over half of the steel purchased for UK construction projects currently coming from abroad (6 million tonnes annually), the potential to purchase more steel from UK producers is significant and would boost steel production, support steel jobs and communities, strengthen manufacturing supply chains, and increase UK GDP.
The Charter builds upon existing government policy on steel procurement but goes one step further by asking signatories to commit to a range of simple procurement steps. These simple steps could transform the way we purchase steel and other materials, ensuring longer term strategic aims are taken into account such as social and environmental considerations, and the UK’s long-term economic growth. These steps will inject real transparency into procurement practises, maximising the ability of UK steel producers to compete for and win supply contracts.
The public sector, and ultimately the taxpayer, is the single biggest purchaser of steel in the UK. UK Central Government alone is projected to purchase £2.5 billion worth of steel in the next five years, for rail, roads, schools, hospitals, ships and much more besides. Huge volumes will also be required for massive private sector projects like Heathrow, Hinkley C and the expansion of our offshore windfarms. Data published this year by BEIS showed that 43% of steel purchased by Government last year was from UK producers, 42% was imported with the remainder being of unknown origin. This provides Government and the steel sector with an excellent starting point to build upon and the potential for big improvements.
As well as BEIS, Welsh Government and Scottish Government, a number of other organisations have already committed to signing the Charter, such as local authorities, construction frameworks, and a range of private sector organisations including RenewableUK and UK Onshore Oil & Gas. Some of these were at the event in Parliament today to sign alongside the Minister.
The UK Steel Sector in Numbers:
- Produces 8 million tonnes of steel a year
- Employs 31,900 people directly in the UK and supports a further 52,300 in supplies chains and local communities
- The average steel sector salary is £36,000, 28% higher than the UK national average and 46% higher than the regional average in Wales, and Yorkshire & Humberside where its jobs are concentrated
- Makes a £1.6 billion direct contribution to UK GDP and supports a further £3.9 billion
- Makes a £3.2 billion direct contribution to the UK’s balance of trade
- 96% of all steel used in the UK is recovered and recycled to be used again and again
UK Steel Director General Gareth Stace said:
“I am incredibly proud that my organisation is launching the UK Steel Charter. We have worked hand in hand with the UK, Welsh and Scottish Governments in recent years to change the way steel is procured in this country, much progress has been made but we know more can still be done. I am therefore incredibly pleased to see the Department for Business signing up to this charter, making a strong showing of support for our industry.
“This initiative, and BEIS’s support for it, will encourage as many organisations as possible to take a more proactive and thoughtful approach to their procurement of steel in the future, and importantly publicise the exemplar approach that many organisations are already taking.”
“UK public procurement accounts for a massive 14% of UK GDP each year, its decisions are therefore a hugely important policy tool and perhaps the most significant intervention the Government makes in the economy. Government procurement decisions are important in themselves but also as a driver and catalyst for positive change elsewhere in the economy. It is therefore essential that a more strategic and long term approach to procurement is developed, sitting at the heart of the Industrial Strategy.