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British Steel

Volume 175: debated on Wednesday 4 July 1990

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To ask the Secretary of State for Scotland what steps he is taking to assess the arguments advanced by British Steel for the closure of the Ravenscraig strip mill, as outlined in the recent letter to him from the chairman of British Steel.

I refer the hon. Gentleman to the reply given a few moments ago by my right hon. and learned Friend the Secretary of State to the hon. Member for Motherwell, North (Dr. Reid).

Does the Minister agree that it is immoral for a man who has just received a 79 per cent. pay rise to show such a lack of concern at the social impact of his decisions? Sir Robert Scholey has made it clear that to protect his private monopoly, British Steel will not sell the strip mill to a competitor. Will the Minister urge his right hon. and learned Friend the Secretary of State to insist that that statement be referred to the Monopolies and Mergers Commission and use the threat of resignation to make sure that that happens?

Sir Robert Scholey has a responsibility to his company and to the steel industry, not only in Scotland. In regard to the other points in the hon. Gentleman's question, Sir Robert pointed out in his letter to my right hon. and learned Friend that there are no fewer than 15 major competitors to British Steel within Europe alone. Competition is a matter for the Director General of Fair Trading.

May I refer the Minister to what the Secretary of State said about the analysis that he has instructed the Scottish Development Agency to carry out? Is he aware that the right hon. and learned Gentleman gave the impression that clear and precise directions were given to the Scottish Development Agency? But I have a letter from Mr. Scott, the chief executive, who says that

"the precise terms of reference of the remit for the study have yet to be settled."
Exactly what will the Scottish Office involvement be in setting the final terms of reference? Will the Minister give an assurance that the terms of reference will include the feasibility of an independent Scottish steel industry and that the preparation of a business plan to attract investment for that objective will not be ruled out?

The terms of reference for the SDA were deliberately made extremely broad. They included the analysis of prospects for the steel industry, the identification of opportunities for it and the ability to assist the Government in the discharge of our responsibilities in relation to any possible contraction of the sector. The kind of detail to which the hon. Gentleman refers is a matter for the SDA to resolve when it decides how to embark on its study.

Has the Secretary of State made a study of the impact on the local economy if Ravenscraig were to close, and if not, why not?

The hon. Lady will know that there are a number of initiatives in the Lanarkshire area, and have been for a number of years—in particular, the Monklands initiative, which is a major initiative. In addition, my right hon. and learned Friend the Secretary of State invited consideration of the possible impact of the hot strip mill closure on the area. Any other initiative that may be necessary will arise as a result of the SDA report or other developments, and will be reacted to at the appropriate time.

May I put it to my hon. Friend arid to his right hon. and learned Friend that they are giving their English colleagues a great deal of concern? We can understand the interest in what happens in Scotland, but we are talking about part of the British steel industry. My hon. Friends are concerned with Scotland, but, as British Ministers in a British Government, will they take account not only of Scottish interests—which, from an English point of view, they seem to be fighting for far too strongly—but of British interests as well?

My right hon. and learned Friend the Secretary of State and I, and our other colleagues, are Ministers in a territorial Department. It would be surprising if we did not direct our attention primarily to the interests of that territory.