This week, the government called for a meeting to discuss the issues within the Steel Industry, in response to the Tata Steel crisis. In response, Made in the Midlands surveyed MIM Council members on three critical points:
- Do you think the government need to create a policy which offers definitive support to UK manufacturing?
- Should the government bailout steel companies the same way they did with the banks?
- Do you think government support for the steel industry should have been addressed in the latest budget?
The MIM Council is comprised of members who help steer the direction of the organisation. The council also assist in reaching a consensus and single voice on issues such as commentary on industry and lobbying issues.
MIM President, Christopher Greenough explained: “What we need is a Government policy that supports UK manufacturing in all it’s forms, and creates an equal competitive playing field when compared with other nations around the globe.”
This sentiment was echoed by every representative of the MIM Council, who agreed that the UK government need to create a policy which can offer manufacturers definitive support. However, Business Development Manager at Frank Dudley Ltd, Josh Dudley-Toole argued: “It should be non-monetary support. Instead, knowledge support, communications support and assistance in breaking down barriers. It should not be cash-flow support.”
According to the BBC, Prime Minister, David Cameron said the government is “doing everything it can” to save thousands of steel jobs – but warned there were “no guarantees of success”. Evidently, the MIM Council feel that the government need to be providing the support to manufacturers currently succeeding within industry, rather than trying to save a situation that is now in the middle of a crisis.
Furthermore, Unite general secretary Len McCluskey said the UK was in the grip of an “industrial crisis of enormous proportions”.
He called for the creation of a steel taskforce and for the government to intervene to save the steel industry like it did the banks during the financial crisis, saying EU state aid rules had not prevented Italy or France from “protecting” their steel industries.
However, the MIM Council failed to unanimously decide as to whether the government should bail out the steel industry in the same fashion they did with the banks. Half of the Council represented the idea that the UK should bail the industry out, whereas the other half agreed that the government need to avoid bailing out the steel industry.
Graham Robinson, Managing Director of Andel Plastics supported the idea of the bailout, as he said: “Definitely, but we would like to see it bought back to be British Steel and remain so, but not as a ‘public sector’ business with all the usual inefficiencies. It should be run by business people with the same reactive powers as a Business owner. Who would have to find efficiencies and flexibility etc. within all aspects of the new business.”
Alternatively, MIM President Christopher Greenough argued: “Nationalisation is something that may be needed as a last resort, to protect jobs, but it is not the answer long term. Would funding incentives to a new buyer be another way?” Also, the BBC said that some of the government fear the reason Tata won’t accept a rescue, is because they aren’t interested in finding a suitable buyer. This decision alone could seal the fate of the steel industry.
Additionally, the MIM Council remained split on deciding whether the government should have addressed their support for the steel industry in the last budget. This question was raised after Shadow Chancellor John McDonnell suggested the government should have brought forward their support in the last budget.
Wendy Bennett, Managing Director of Lost Wax Development explained: “Yes, the steel industry is the backbone of manufacturing and for it to be left to fall like it has, it’s very short-sighted.” Furthermore, Graham Yeomans, Managing Director of Yeoman Pressings Ltd added: “They should have eliminated the tariffs on energy, any commercial rates that they’ve got for the site and also any national insurance payments can be deferred for several years. Instead, the government will have to deal with 3,000 people unemployed.”
In contrast, David Lindsey, Managing Director of Laser Process Limited replied: “I think we have been looking for manufacturing support for a long time, not just in the last budget. I’m not sure how much of the present crisis the government would have been aware of at the time of the last budget. Obviously, if they had have known about it, that would have been an ideal time to do something about it.”
Clearly, the MIM Council felt that should the government have known about the crisis facing the steel industry, they should have acted in the last budget. Now, the government face the prospect of dealing with mass unemployment and the slow demise of the steel industry.
In conclusion, the MIM Council reflected a 50-50 difference in opinion, with regards to the government including the steel industry in their latest budget and a potential government bailout. However, every member of the MIM Council called for the government to introduce a policy which will offer support to UK manufacturers. This doesn’t necessarily reflect a monetary value of support to each manufacturer, simply a system which supports innovation, research, communication and the additional qualities that are present within successful manufacturing companies across the globe.