Ninety per cent of ceramics manufacturers across the UK are set to miss out on energy discounts announced by the Government, a Staffordshire-based trade organisation has claimed.
Ceramics UK says only 10 per cent of its members will be entitled to the support outlined in a consultation released on Friday.
The trade body, which represents the interests of manufacturers across all sectors of the industry, says this is the latest blow for the multi-billion-pound sector, after promises of support ahead of the Spending Review and the Industrial Strategy failed to materialise.
It was described by Stoke-on-Trent Central MP Gareth Snell as a “kick in the teeth”.
On Friday, the Government announced a four-week consultation on its Network Charging Compensation Scheme plans to increase the discount on businesses’ electricity network charges from 60 per cent to 90 per cent from 2026.
It said around 500 of the UK’s most energy-intensive firms are set to save up to £420 million a year in key sectors including ceramics.
But Rob Flello, CEO of Ceramics UK, said the organisation has grave concerns about the latest announcement and the details set out in the consultation.
He said: “Only 10 per cent of Ceramics UK members would currently be entitled to support, despite the sector being a high-energy user.
“Members who could potentially be eligible are excluded by the Government’s business-level test, which uses an artificially low electricity cost figure, and many gift and tableware manufacturers will be unable to access support all together, as they do not have the correct manufacturing category code.
“We are also concerned that the scheme is self-funding, meaning ineligible members effectively subsidise those who are eligible. This directly contradicts the Government’s statement on 1st May on the floor of the house that no new costs would be added to our industry.
“Furthermore, there is a need for clarity on who will cover the increased costs associated with moving from 60 per cent to 90 per cent support.”
After the announcement of the consultation, Business Secretary Jonathan Reynolds said: “The cornerstone of our modern Industrial Strategy, this landmark new support will meet a longstanding need from industry which other governments shirked – paving the way for new investment and job creation at the heart of our Plan for Change.”
But Rob added: “We were deeply disappointed with the Government’s Modern Industrial Strategy and felt misled.
“The UK ceramics sector is predominantly gas-intensive, with a significant proportion of our members depending on natural gas for high-temperature processes that are currently not economically or technically viable to electrify.
“As such, while this reform may bring relief to certain energy users, it will offer little benefit to the majority of ceramics manufacturers, many of whom continue to face unsustainable energy costs that impact their competitiveness and long-term viability.
“The Department for Business, the Department for Energy, and the Treasury still do not seem to understand that energy-intensive doesn’t just mean electro-intensive.
“Ceramics needs help with gas prices.
“We need the Government re-evaluate its plans and work with us to back one of the UK’s most enduring and strategically important manufacturing industries.
“We are world-leaders in the production of both traditional and advanced ceramic materials, supporting industries ranging from giftware through to aerospace, defence, construction, clean energy and electronics.
“The industry contributes more than £2 billion directly to the UK economy annually and employs approximately 20,000 people as well as enabling tens of thousands of other jobs from advanced manufacturing, through steel and glass workers, to bricklayers and more besides.
“The proposals need to be rebalanced and ensure that critical manufacturing sectors are not left behind.
“Our members have more than 150 operating sites across the UK and the sector is already an essential part of Britain’s industrial future – but we cannot do that if government continues to misunderstand the fundamentals of our industry.”
- Read yesterday’s story about the ceramics sector taking key messages to Westminster here.
Liebour strikes again Rob. Those in charge, and their legions of Starmtrooper stooges, really, really hate business. Why don’t they understand that without profitable business paying taxes, there can be no state sector to spend the money!