Forty years ago, manufacturing accounted for 30% of GDP in this country. It now stands at barely 9%. If there is to be any serious agenda for levelling up in this country, we need a modern manufacturing renaissance to close the gap between the regions, to rebalance between services and manufacturing, and to be a country that is actually exporting again, which has a massive impact on our balance of trade. We need steel to be at the heart of that modern manufacturing renaissance.
Steel is the backbone of manufacturing. It is in the cars that we drive, the offices we work in, even in the cutlery we use to eat our meals. It is at the heart of our aerospace and automotive sectors. It is absolutely vital as a foundation industry.
The Port Talbot steelworkers in my constituency make the best steel that money can buy. It is green steel. Imagine relying on steel from China, which has some of the dirtiest steel production processes in the world. Allowing our steel sector to collapse would be the definition of a false economy, in terms of the need for a proper industrial strategy and the reduction of our dependence on China.
Steel is the beating heart of the economy and community, with 4,000 well-paid steelworkers in my Aberavon constituency. Some say that steel is a sunset industry. Nothing could be further from the truth. It is vital in photovoltaic cell production, and the vast majority of the alloys that are used in steel these days did not even exist 10 years ago. It is at the cutting edge of innovation.
Tata Steel is in the midst of a cash-flow crisis because of the impact of covid-19, which has caused demand for steel to fall off a cliff. It needs Government-backed loan support. I do not care whether that is a loan or Project Birch; it does not matter. We need support from Government so that the steel industry can weather the storm and help us to build back better.
There can be no post-pandemic economic recovery without a strong and healthy steel industry. Imagine the cost of doing nothing—4,000 well-paid workers going on to benefits. The capital expenditure costs of decommissioning the Port Talbot steelworks would be astronomical. The loan would be far better value for the taxpayer than the cost of doing nothing.
I urge the Government to step up to the plate. I urge the Government to take the long view and put in place an industrial strategy that includes energy prices, business rates and a proper trade defence mechanism, so we stop the dumping of Chinese steel. All that needs to happen and it needs to happen now—but first, we need that loan from the Government, and we need it today.
3.49 pm