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Simple support could boost potential and productivity

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Government support for steel manufacturers captures headlines when it is asked for to support carbon emission reduction measures that support the climate change struggle. That support is, from the point of view of the steel sector itself and many commentators from elsewhere, vital to secure the strategic ability of the UK to produce a strategic resource as well as to support the industry’s net-zero ambitions.

For itself, the BCSA has always taken pride in having a financially sound, technically competent and world leading membership that makes few demands on government. Like all other sectors however constructional steelwork does need some consideration from government, and the BCSA has from time to time identified areas where government action would benefit the industry and the wider economy. In February the BCSA launched a ‘manifesto’ (see News) detailing some measures that would benefit steelwork contractors and manufacturers as well as others in the construction industry and the entire UK.

The manifesto calls for Parliament to introduce five measures to improve situations that are preventing constructional steelwork and others from achieving their potential. First among these is an end to cash retentions. Steelwork contractors are among the first to complete their work on site but can be at the end of the queue to be fully paid when the project completes. Insolvency can overcome main contractors before these amounts are paid, so BCSA has joined an industry groundswell of calls for instituting Project Bank Accounts to keep retentions safe from liquidations.

The manifesto calls for prioritising UK companies on all public funded contracts such as HS2, and for social value assessments and government’s existing Procurement Policy to be monitored and enforced all along the supply chain.

The UK faces a large and growing skills crisis and the BCSA has supported moves to increase the number of apprentices entering the industry, but financial incentives to colleges and apprenticeships providers are unintentionally encouraging provision of Level 3 apprenticeships over Level 2, for which the demand is higher. BCSA calls for a ‘fit-for-purpose’ apprenticeship scheme that removes this anomaly to meet the skills crisis.

There is a widely acknowledged need for improved access to finance that would support innovation and productivity improvement. The BCSA’s members have a long track record of investing in the latest CNS fabrication machinery and software, which helps explain the sector’s world leading performance, but encouragement for government departments and funders to support these investments is needed.

Steel manufacturers have shown themselves to be keen to decarbonise their operations and prepared to make substantial investments, but this needs support of all kinds from government. BCSA warns that without this support more steel will be imported to meet net-zero targets. One key measure would be to extend the national grid to provide power for electric arc furnaces.

As BCSA CEO Dr David Moore said at the House of Lords manifesto launch, the UK steelwork sector is an economic building block that needs and deserves recognition and support of its potential to be a booming industry creating jobs, boosting GDP and delivering opportunity. These are simple measures that politicians could take to deliver a shot in the arm for the sector and beyond. Let’s hope the government and its successors take heed.

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