David Cameron has been accused of misleading steelworkers losing their jobs after it emerged an £80m fund to help them find new work will partly be used to pay their final salaries and redundancy packages.
Anna Turley, the Labour MP for Redcar, said she had seen an email to a constituent from James Wharton, the northern powerhouse minister, that confirmed the aid cash to support the workers was actually also a bailout fund for salaries they were due from their employers.
The prime minister said the government had done a lot to help the thousands of steelworkers being made redundant in Teesside and elsewhere.
But he also insisted the closure and mothballing of steel plants was a world problem largely beyond the UK government’s control.
“Let me tell the honourable lady what we can’t do. We can’t, in this house, set the world price of steel,” he said.
Cameron was also confronted about the plight of steelworkers by the Labour leader, Jeremy Corbyn, who accused the government of having no industrial strategy to help out the crisis-stricken sector.
“Do you appreciate the devastating effects of the government’s non-intervention in the steel industry is having on so many people?” Corbyn said.
The prime minister said the UK had fought in the EU for more anti-dumping measures – to stop countries flooding the world market with below-cost steel – and highlighted new procurement rules which already meant more public sector projects used British steel.
“We do want to help our steel industry and I will set out exactly how we will help the steel industry,” he said. “It is in a very difficult situation, world prices have collapsed by more than half, the surplus capacity in the world is more than 50 times the UK output.
“But our plan is to take action in four vital areas: procurement, energy costs, unfair competition and dumping, and tax and government support.”
Cameron is under particular pressure over the government’s role in helping the steel industry because the crisis coincides with a visit from the president of China, Xi Jinping, whose country stands accused of dumping cut-price steel on the market and unfairly undercutting UK producers.
On Tuesday evening, Corbyn raised the issue of China’s behaviour in a meeting with Xi, and Cameron has promised to bring it up as well in bilateral talks in Downing Street on Wednesday afternoon.
