The last production plant of steel of its kind in England could be nationalised in the near future after the government was given the power to compel British Steel’s owners to keep the plant running – and the government will cover the losses for doing so. The state is in a race against time to secure the production of locally-made steel.
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The current owners of the British Steel plant in Scunthorpe, Chinese firm Jingye, have threatened to shut down the last remaining major producer of steel in England.
The availability of cheaper steel from abroad, the investment needed to modernise the plant, and the losses being incurred for running the plant have been cited as reasons for closing the site down.
Parliament sat for an extraordinary session on Saturday to approve a bill that would compel the owners to keep the site running, with the current issue being buying enough materials, and on time, to keep the furnaces running.
The Chinese owners say they lose about £700,000 per day on keeping the facility operating, which the government will cover in the meantime.
The arrangement could end up as a nationalisation of British Steel. It provides around 2,700 jobs to Scunthorpe and the area, and produces everything from rail tracks to girders for the construction industry.
This is not the first time the government has taken control of a site like this – the state now operates Sheffield Forgemasters, which supplies parts for the Royal Navy.
A delegation from Chinese owners Jingye were blocked from accessing the British Steel site on Saturday morning by the workers, sparking fears that they would try to shut down the plant.
Business Secretary Jonathan Reynolds said the Jingye Group, which has owned British Steel since 2020, had not been negotiating “in good faith”.
Mr Reynolds said: “If we hadn’t acted, the blast furnaces were gone, steel production in the UK, primary steel producing, would have gone. So we’ve given ourselves the opportunity, we are in control of the site, my officials are on site right now to give us a chance to do that.”
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