Posted: 21 March, 2013 at 10:30 am

MP calls for Tata investment after Budget tax cut

MP calls for Tata investment after Budget tax cut

ROTHERHAM MP John Healey has called on Tata to boost investment and back steel production in the town.

It comes after changes announced in the Budget yesterday which means from next year steel-making will become exempt from the Climate Change Levy, a tax on energy use.

Mr Healey had called for the introduction of a “metallurgic process” exemption, including by appealing directly to the Chancellor in October 2012.

He argued the exemption would help electric arc steelmakers like Tata in Rotherham, who are high users of energy, stay competitive in Europe.

Mr Healey told the Commons yesterday after the Budget announcement: “I have the honour of representing a steel area in Rotherham. Steel is one of this country’s strategic industries, and the Chancellor’s announcement today will be very welcome in my constituency.

“It will help to secure the industry for the future, and I hope that it will also help to secure extra investment from Tata Steel.”

He also called on the Government to do more to boost growth.

“The big gap in the Chancellor’s record to date—and, to an extent, the Budget announcements today—remains that we have a growth crisis without having a growth plan.

“When the Chancellor first took office nearly three years ago, unemployment was falling, the economy was recovering and we had had growth of 1.9% in the final year of the last Labour Government. That is the baseline from which the Chancellor has now given us four Budgets, four fiscal reports, four economic forecasts—with each one worse than the last.

“Since his first Budget plan in June 2010, debt is up, borrowing is up, we have lost our triple A credit rating, the economy has flatlined and we have had the first double-dip recession for 40 years.

“Five years after the recklessness of bankers brought the global financial system close to collapse and drove a worldwide downturn and three years after this Chancellor took control, our UK gross domestic product is still 3% lower than it was at the start of that global crisis.

“So, our economy is smaller, weaker, making less, earning less and contributing less in revenues to the public finances. Other major countries such as Germany or the US have made up the ground they lost during that global financial crisis—we have failed.

“I would argue that, after three years of economic policy failure, the balance of economic advantage lies decisively in Government borrowing to invest and build.

“Borrowing for those purposes can be good borrowing. There is a difference: not all borrowing is bad borrowing. Interest rates on public debt are at an historic low, so now is exactly the right time for government, both national and local, to borrow for that investment.

“The Chancellor has confirmed in his Budget that his economic plan is failing, but he has also confirmed that he is sticking to that plan.

“We need a change. We need a change of policy, we need a change of Chancellor, and yes, we need a change of Government.”