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HS2 and British steel

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Tata steel will be used for the £55billion HS2 high speed rail network, which will require 200 million tons of track, according to a Daily Express report.

Daily Express: '200 million tons of steel needed for HS2',  2016-04-03

[‘Government lifeline for Tata: HS2 ‘will be built with British steel’,
TATA steel will be used to make tracks for the HS2 high speed rail network, Government sources said last night as new plans were unveiled to keep British steel-making alive. By Marco Giannangeli, Apr 3, 2016]

All capital projects will give special consideration to the social and economic impact of using home-sourced rather than imported steel at the procurement stage.

While this was already the case with some projects, ministers yesterday extended the condition to all public sector bodies including the NHS and local councils.

It comes as Prime Minister David Cameron defended his decision to block EU efforts to raise tariffs on imported steel.

However, China stoked tensions by announcing their own 46 per cent levy on the type of steel produced in Port Talbot.

This was despite a meeting between Mr Cameron and the Chinese president Xi Jinping at the Nuclear Security Summit in Washington DC only the previous day.

According to the new guidelines, decisions on the awarding of new contracts will take into account factors such as responsible sourcing, training given to workforces, carbon footprint, protecting the health and safety of staff, and the social integration of disadvantaged workers.

With £300 billion of infrastructure projects up or grabs over the next five years, the move will create the “level playing field” needed for British steel to compete with foreign competitors and secure its long-term future, Government sources said.

Cabinet Office minister Matt Hancock said: “We are going further than ever before to support British steel. Taxpayers spend billions of pounds buying steel for public projects.

“From operating theatres to new buildings, public sector buyers will need to consider social and economic benefits, alongside value for money.

“When public bodies buy steel they must take account of the true value of buying British.”

Network Rail already buys around 120,000 tons of steel a year from Tata Steel in Scunthorpe

The £55billion HS2 project will require 200 million tons of steel tracks.

A source said: “British steel will be used – no question now.”

Network Rail already buys approximately 120,000 tons of steel for rails a year from Tata Steel in Scunthorpe, which is about 96 per cent of its total demand.

Downing Street confirmed Mr Cameron will meet Carwyn Jones, First Minister of Wales, on Tuesday to update him on the Government’s ongoing discussions with Tata and work to support a sales process.

The £37 billion spent by the Government to bail out RBS in 2008 would, campaigners say, keep Tata steel operating for the next 123 years.

Business Secretary Sajid Javid told Port Talbot workers he was “confident” a buyer could be found for the plant, which is losing £1million a day and faces closure in less than three weeks.

Actually, “200 million tons of steel track” probably wouldn’t be used. And if Tata steel were used, it probably wouldn’t be sourced from the UK.

That’s because

  • UIC60 rail is 60 kg/metre; HS2 is, in essence, (4 * 540) km of rail, plus a few sidings
  • according to the government, HS2 phase one would require about 2 million tonnes of steel in total, not just for rails
  • Tata has announced that all its UK steel manufacturing is up for sale.

The crisis exposes the Tories as out of touch and incompetent, according to shadow chancellor John McDonnell.

[My £35 billion blueprint to save British steel – and it’s not just about EU, John McDonnell, Opinion, The Mirror, 3 Apr 2016]

Labour’s John McDonnell says “doing nothing is not an answer” as he unveils his four point action plan to rescue the British steel industry

The steel crisis exposes the Tories as out of touch and incompetent.

Forty thousand workers and their families face the loss of their livelihoods.

As we saw under the Tories in the 1980s, closures like this can tear apart entire communities.

Even some Tory MPs share Labour’s call for emergency measures like nationalisation not to be ruled out.

Yet David Cameron refuses to recall Parliament for an emergency debate.

Some have tried to claim measures to combat climate change are to blame.

However less than two per cent of steel production costs are due to climate measures.

In reality, British steel is in crisis because of the dumping of cheap steel by China and because we have a government that will not take the action necessary.

Other EU countries like Germany and Italy have acted to protect their steel industries.

The barrier to action isn’t in Brussels. It’s in West-minster, where the Government has spent three years blocking EU action.

One EU official even claimed the Tories were blocking action on dumping as a “thank you” to China.

This has done us no good. China has slapped a 46 per cent tariff on British steel.

Labour has different priorities. This is our four-point Action Plan to save British steel:

* Stabilise the industry and protect steelworkers by allowing time for a buyer to be found but being prepared to nationalise plants threatened with closure.

* Fast-track key investment projects like high-speed rail in the North, and build them with British steel.

* Create a level playing field. The Tories must stop blocking EU initiatives to protect steel but also look at business rates and energy prices.

* Restructure the industry so it has a future, in partnership with workers, management and major customers working alongside government.

This isn’t just about the jobs and communities now being threatened.

It’s about how we start to make an economy that works for the good of all.

Doing nothing is not an answer.

John McDonnell MP (via Wikipedia)Only recently, a big order for Spanish-built trains for the North of England was placed, but John McDonnell doesn’t seem to have had any concerns about their steel content.

Anyway, in the whole of 2014, UK crude steel production was 12.1 million tonnes, which is less than one week of Chinese output.

In 2013, UK production was 11.9 million tonnes.

If the HS2 Y network required 5 million tonnes over 15 years, and it was all sourced from the UK, it would increase annual UK output by just 330,000 tonnes.

In reality, whatever the nonsense spouted by John McDonnell or Matthew Hancock, it is likely that a very large proportion of HS2 steel would be sourced from abroad.

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Written by beleben

April 3, 2016 at 1:25 pm

3 Responses

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  1. They say that now ‘cos it’s politically expedient, but with Chinese money propping up HS2, what’s the betting that Chinese Steel will be insisted upon by China?

    Ewen Simpson

    April 3, 2016 at 11:29 pm

  2. No one appears to have factored in all that high performance steel fencing, not to mention the 000’s of miles razor wire, needed. Surely, “we” have the technology to do that ourselves, too??

    mcMichael

    April 4, 2016 at 10:29 am

  3. Surely the policy of the UK government in dealings with any foreign government should be “tit-for-tat”. If the Chinese are dumping and setting a levy of 46% on British steel then the same should be applied to them.

    It seems that the present policy is to buy from any source at the lowest possible price whatever the consequences. This must be wrong if it means a reduction in employment and the loss of a strategic industry due to dumping. At least we should do what the co-members of the EU do to protect their industries.

    The logical thing to implement is that government financed projects are supplied with British steel. If that is not available then from our partners in Europe.

    This is an industry that must not be sold down the river. The unions, also, have to be taken on board making it clear that such a policy is not a blank cheque for their members.

    Stephen Cryan

    April 4, 2016 at 6:00 pm


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