Heathrow investment expected to secure thousands of steel jobs

The Government has welcomed a new multibillion-pound investment programme from Heathrow Airport, which is expected to secure thousands of UK steel jobs across the country by driving a significant increase in demand for UK-made steel.

Heathrow has announced it will invest billions in a new expansion programme for new terminal buildings, aircraft stands, passenger infrastructure and its third runway plans, marking a major vote of confidence in the Government’s plan for growth after the Chancellor confirmed the government’s backing for Heathrow’s expansion.

At an event hosted at British Steel’s Scunthorpe plant, Heathrow also signed the UK Steel Charter, which signals the airport’s commitment to use UK-made steel wherever possible as part of its investment programme.

The commitment represents a major win for the steel industry and will help secure thousands of existing steel jobs both at Scunthorpe and across the country. It will bring a huge increase in demand for UK-made steel to supply Heathrow’s expansion project.

By its completion in 2008, the construction of Heathrow Terminal 5 had required 80,000 tonnes of steel, and estimates suggest construction of a third runway could require 400,000 tonnes.

Industry Minister Sarah Jones welcomed the announcement as a major step forward in the Government’s growth mission, with new investment crucial to kickstarting the UK’s economic growth and putting more money in people’s pockets, delivering on the Plan for Change.

Industry Minister Sarah Jones said: “This investment is the latest in a long line of wins which our Plan for Change has helped deliver, and not only secures thousands of jobs but marks a major vote of confidence in our homegrown steel sector and this government’s Industrial Strategy.

“Driving demand for UK-made steel is a crucial part of our upcoming Steel Strategy, and by signing the Steel Charter Heathrow will give a huge boost to steelmaking communities across the UK and help us kickstart economic growth.”

Alex Veitch, Director of Policy at the British Chambers of Commerce said: “Expanding capacity at Heathrow is a key part of accelerating economic growth – and today’s announcement is great news for British business.

“It is real show of support for domestic steel production and supply chains across the UK. As further infrastructure projects are given the green light, many more opportunities can be seized to boost British business and drive forward growth.”

Gareth Stace, Director-General, UK Steel said: “The UK steel industry welcomes Heathrow’s multi-billion-pound investment programme, a major boost for British businesses and a clear signal that the UK is open for growth. This transformative investment will upgrade vital infrastructure, create jobs, and strengthen the UK’s position as a global hub for trade and travel.

“As part of this commitment, Heathrow has pledged to maximise the use of UK-made steel with the UK Steel Charter, ensuring that the benefits of this project are felt across the country. British steelmakers produce world-class, high-quality products that support major infrastructure, and Heathrow’s decision to prioritise domestic steel and British business reinforces the strength and resilience of the UK supply chain.

“This is a vote of confidence in British manufacturing, supporting skilled jobs, driving investment, and helping to build a stronger, more sustainable economy.”

Heathrow’s new investment follows the Chancellor announcement of the Government’s full backing of a third runway expansion in her recent Growth Speech where she pledged to go further and faster to kickstart the UK’s economic growth.

The Government has been clear that a third runway could add billions to a better-connected UK economy, deliver cheaper air fares and fewer delays, and drive UK exports and investment to new heights.

According to new research from the consultancy Frontier Economics, a third runway at Heathrow Airport could increase the UK’s potential GDP by almost 0.5% directly by 2050, with over 60% of that increase going to areas outside London and the South East.

Using UK-made steel on construction at Heathrow will also give a significant boost to the UK’s steel industry for the long term, which already supports over 75,000 jobs and contributes almost £2 billion a year to the economy.

Following this annoucement, the Business Secretary launched the Plan for Steel Consultation. This will look at the long-term issues facing the industry like high electricity costs, unfair trading practices, and scrap metal recycling – to protect jobs and living standards in the UK’s industrial heartlands.

Up to £2.5Bn will be put towards supporting the steel industry, as per the manifesto commitment, including via the National Wealth Fund. This could benefit regions across the UK – like Scunthorpe, Rotherham, Redcar, Yorkshire, and Scotland – which have a strong history of steel production. It will be spent on initiatives that will give the industry a long future – such as electric arc furnaces, or other improvements to UK capabilities.

This will drive growth in the economy – the priority of the Plan for Change – and protect our industrial heartlands for the long term.

Business Secretary Jonathan Reynolds, said: “The UK steel industry has a long-term future under this Government. We said that during the election, and we are delivering on it now. 

“The deal announced by Heathrow this week will secure a strong industry pipeline for years to come – and we are putting the full weight of Whitehall behind the industry to build on this success. 

“Britain is open for business, and this Government has committed up to £2.5Bn to the future of steel to protect our industrial heartlands, maintain jobs, and drive growth as part of our Plan for Change.”

The Plan for Steel will help with the issues which have been holding the industry back for too long. It will look at ways to:

• Identify where there are opportunities to expand UK steelmaking to better support UK manufacturing, construction, infrastructure and growth – and secure UK jobs and livelihoods
• Protect the steel sector from unfair trading practices abroad
• Improve our scrap processing facilities so they can best support the steel-making of the future
• Encourage high usage of UK-made steel in public projects

To make the UK competitive globally, the Plan for Steel will examine the electricity costs for steel companies.

If you would like to read more stories like this, then please click here