HC Deb 20 July 1981 vol 9 cc14-5
13. Mr. Hooley

asked the Secretary of State for Industry if he is satisfied that the current capacity of the steel industry, public and private, is sufficient to meet home and export demand over the next five years.

Mr. Michael Marshall

Yes, Sir.

Mr. Hooley

Is the Minister aware that steel is being imported which, given the capacity, the British Steel Corporation could easily make? Is he aware that the capacity in West Germany is 68 million tonnes, and that the capacity in Spain and Italy is greater than that of the United Kingdom and is expanding? In such circumstances, what is the rationale of cutting back the United Kingdom's capacity to make steel?

Mr. Marshall

The rationale is that the United Kingdom production of between 16 million tonnes and 18 million tonnes of liquid steel is, in the judgment of those involved in the industry, more nearly related to the market situation. In Europe, as the hon. Gentleman is well aware, there is 30 per cent. to 40 per cent. excess capacity. It is now up to other countries to move in the same direction as this country has moved.

Mr. Hal Miller

Is my hon. Friend satisfied with the division of our present capacity between the public and the private sectors? If so, how will he maintain it, in the light of the considerable subsidies that are still being afforded to British Steel?

Mr. Marshall

No, I am not satisfied with the division. I look to the increasing opportunities of moving down the Phoenix route to bring more capacity to the mixed public/private Phoenix pattern.

Mr. Orme

Will the Minister say something about the negotiations in the EEC and the proposed quotas? From what we hear they will not be very advantageous to the British steel industry.

Mr. Marshall

This is a complex matter. We shall have an opportunity to debate it soon, when I am sure that the right hon. Gentleman will wish to pursue the matter. My hon. Friend, who has been deeply involved in these matters, will look forward to giving a full account of the situation. We have steered a course aimed at getting the best possible deal in difficult negotiations.