The government claims that its new steel procurement guidelines are already have an impact, with almost all reinforcing steel bar in the UK now sourced domestically.
Imports of reinforcing steel bar in January 2016 were down 99% on January 2015, it said.
In October 2015 new procurement guidelines came into effect to encourage greater use of UK steel. All central government departments must now consider the social and economic impact of the steel they source across all major projects. Public procurements that involve the supply of steel are now required to consider responsible sourcing, the training that suppliers give to their workforce, carbon footprint, protecting the health and safety of staff and the social integration of disadvantaged workers. The aim was to help save the UK steel industry by providing public procurement officers with a reason not to take lower costs bids from overseas, and particularly from China.
These guidelines have now been extended from central government departments to the entire public sector.
Cabinet Office minister Matt Hancock, in charge of public procurement policy, said: “We are going further than ever before to support British steel. Taxpayers spend billions of pounds buying steel for public projects. Last year we changed the rules across all central government procurement to ensure buyers take into account the true value of British steel – including local impact and jobs.
“The industry is responding positively to this so I want to go further. Now we will apply this guidance across the public sector so that, 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 taking account of the true value of buying British.”
However, it all seems to be too little too late with the announcement last week that Tata Steel was selling its UK operations because it is no longer prepared to sustain losses of £1m a day. The Port Talbot plant is now heading for closure, with thousands of jobs at risk.
Trying to deflect blame for any responsibility that it might have for the collapse of UK industry, the government said that 96% of Network Rail’s steel (120,000 tonnes a year) and 85% of Crossrail’s steel (7,000 tonnes) came from Tata Steel in Scunthorpe.
It was also keen to highlight that Tata Steel supplied 40,000 tonnes of steel for HMS Queen Elizabeth and developed new grades of lighter and stronger steel specifically for the future flagship of the Royal Navy. Tata Steel is also booked to supply steel for the second carrier, HMS Prince of Wales.
However, precisely none of the 37,200 tonnes of steel being used to construct Scotland’s new bridge across the Forth, the Queensferry Crossing, comes from the UK. On this project, 4,200 tonnes of steel has come from Gdasnk, 8,500 tonnes is from Seville and 24,500 tonnes is from Shanghai. The Scottish government transport minister Keith Brown has said that he was “content that proposals for sourcing steel represent best value for money for the public purse”. [See our previous report here.]
This article was published on 4 Apr 2016 (last updated on 4 Apr 2016).