Major infrastructure clients and public sector bodies will be encouraged to buy British steel in a bid to save the country’s beleaguered industry.
Under new procurement guidelines unveiled by business secretary Sajid Javid, public sector bodies such as Network Rail, Highways England and the NHS will be required to consider the social and economic impact on the UK before buying steel from abroad.
The changes will apply to all projects over £10m, with clients expected to consider the carbon footprint of sourcing and transporting construction materials overseas, as well as social concerns such as the health and safety of suppliers’ staff.
Construction companies that win public sector will also be required to advertise their requirements for steel to UK producers so that domestic firms can compete for the business.
It is hoped the new guidelines will ensure the UK steel industry is able to benefit from the £300bn that will be spent on major infrastructure projects across the country over the next five years.
The plan comes after Tata Steel last week announced its intention to sell off its UK businesses, including the country’s biggest steel mill in Port Talbot, after incurring heavy losses.
Tata blamed high energy costs, weak demand and cheap imports of Chinese steel for the losses.
Mr Javid said: “I am determined to make sure we do all we can to secure a sustainable future for UK steel and find a viable solution that supports the workers and wider community.
“By changing the procurement rules on these major infrastructure projects, we are backing the future of UK steel – opening up significant opportunities for UK suppliers and allowing them to compete more effectively with international companies.”
Last October the government brought in new guidelines that required all central government departments to consider the social and economic impact of the steel they sourced for major projects.
However, these guidelines have now been extended to councils as well as major public sector bodies such as local councils, Network Rail and Highways England.
Mr Javid said: “With £300bn due to be spent on infrastructure projects in the next five years, this will let all buyers take into account the true value of British steel.”
The move was welcomed by the Labour Party and steel unions but both said the government still needed to do more to save the ailing sector.
Shadow chancellor John McDonnell called on ministers to speed up the construction of infrastructure projects such as High Speed 2 to support the steel industry and encourage investment.