To ask Her Majesty’s Government what discussions they have had with trade unions representing workers at Teesside Cast Products about the decision to curtail production at the Teesside plant in January.

My Lords, I have spoken to representatives of the unions, community and Unite about the very regrettable situation at Teesside, as well as to local government representatives and Redcar’s Member of Parliament. Earlier this week, I announced, with the regional development agency One North East, a £60 million programme of support that will help to create jobs and promote enterprise and innovation and contribute powerfully to the region’s and to Teesside's industrial future.

My Lords, I declare an interest as a general secretary, a long time ago, of the Iron and Steel Trades Confederation—the union now called Community. I warmly welcome and sincerely thank my noble friend the Minister for his reply and the prompt action that he has taken this week. I can do no more at this stage than to quote Mr Michael Leahy, the general secretary of Community, who said that,

“Tata Corus are making a premature decision”—

without consultation, may I say—and that there is still time to avoid what would be a disaster for the workforce and the community at large. Does my noble friend agree that mothballing, which is the position that Tata holds, is not the answer? Finally, although he has come forward with the £60 million, which is to be gladly received, saving the plant is a top priority for the unions. Does he agree with that?

My Lords, of course I share my noble friend’s sentiment about the loss of jobs at the plant, but he will know that the reason for the company’s decision is the loss of a 10-year contract with a consortium of companies for the supply of the plant’s product—steel slab—and its inability to agree the sale of the plant to one of the companies in the consortium, as it had been attempting. I am not giving up on the plant—of course not. However, in my view it was necessary for the Government to move quickly to build up alternative industrial development and enterprise and sources of development, rather than simply to sit on our hands and to hope for the best.

While we welcome this much-needed help and the First Secretary of State’s assurance that he is not giving up, in the terms that he has just outlined, would he please reconsider his opposition to the straightforward loan guarantee scheme that we on the Conservative Benches have advocated for more than 12 months? Could he not introduce it now as a more effective way in which to support small and medium-sized enterprises and guarantee jobs, rather than trailing another narrowly targeted government scheme?

Noble Lords will be aware that the Government announced yesterday in the Pre-Budget Report that we are extending for a further year the life of the enterprise finance guarantee scheme, which is the way in which we are both funding and operating the theoretical alternative that the noble Lord has just described. I am sure that he will want to join me in looking forward to a speedy deployment and take-up of the programme that we have announced this week, on which we are working in close co-operation with the regional development agency One North East. If that regional development agency did not exist, we would not have an operational agency on the ground to help us to deliver this very important programme.

My Lords, as time goes past we are learning about the tragedy and disaster in Teesside. It has been welcome in recent times that there has been talk about diversifying from financial services to manufacturing and innovation. In that connection, the Government’s plan for £60 million in aid for steel is very welcome. I urge them to involve all local people—by that, I mean employers, employees and local people themselves—in plans and ideas for the future development of jobs in the area, to ensure that ideas come forward and people are listened to. Reskilling is all very well, although I approve of what the Government are doing about it, but we have to get the jobs, and we will do that by listening to local people and encouraging innovation, local jobs and local businesses.

The noble Lord is right in the way that he understands and characterises the modern industrial policies that I am developing. He will be encouraged to know that, within the programme that I announced this week, there will be £20 million of investment in the Tees Valley to upgrade available industrial land and install utilities to make it suitable for new low-carbon energy and biotechnology business clusters; a further £10 million for the production of environmentally friendly low-carbon goods in the Tees Valley; and up to £20 million to modernise the Wilton chemicals complex and secure further private-sector investment for the long-term future of that complex—incidentally, the largest chemicals cluster in the UK. We have also allocated £10 million for apprenticeships, capital investment, business advice and access to finance to support business start-ups. We could not deliver or make good any of those commitments without the closest possible co-operation with local people and their community representatives.

My Lords—

My Lords, with apologies to my noble friend, we are in the 31st minute.