The UK is keeping “all options on the table” over the potential nationalisation of the Chinese-owned British Steel plant in Scunthorpe, Sir Keir Starmer has said.
The Prime Minister insisted he understood the importance of the plant, which is Britain’s last remaining steelmaker, in a Q&A with the House of Commons Liaison Committee, after its owners last month announced plans to shut its two blast furnaces and steelmaking facilities.
Sir Keir told the panel of senior MPs that the government “will keep talking” to the plant’s owner Jingye Group, which has previously rejected a £500m UK rescue package.
He said: “We have made an offer, but all options are on the table in relation to Scunthorpe. I think it’s really important and we’re in the middle of those discussions.”
Asked what he meant by “all options”, Starmer replied: “I don’t want to be unhelpful to the committee, but as you can imagine, these are ongoing discussions at the moment.
“I can reassure the committee that we’re doing everything we can to ensure there is a bright future for Scunthorpe. But as to precisely where we’ve got to in those talks, I will very happily provide you with further details as soon as I can.”
It comes amid a report by Bloomberg News that the government is considering nationalising the steelworks in a bid to salvage the UK’s steelmaking industry from permanent closure, and is in talks with Jingye, which bought the plant from liquidation in 2020, to find resolution.
Active discussions about taking the site into public ownership are going, Bloomberg reported, according to sources familiar with the issue, who told the outlet ministers would do whatever it takes to save British Steel from collapse, but stressed plans were not finalised.
Unions are warning Jingye has cancelled orders for raw materials needed to make steel, which could see the plant effectively close for good within days.
But ministers are now looking at putting in the order themselves, in a bid to buy time to find a resolution, Bloomberg added.
It speaks to a challenge for a vital industry as the UK – and allies – increase spending on defence, including military procurement, as the US steps back from European security amid Russia’s ongoing invasion of and war in Ukraine.
While fears for the future of steelmaking in Britain are being worsened by President Donald Trump’s imposing 25 per cent tariffs on imports of foreign steel to the United States.
Last month it emerged British Steel plans to close the two furnaces and shutter the steelmaking operations in Scunthorpe, which would put up to 2,700 jobs at risk.
The company is consulting unions and the around 3,500-strong workforce on redundancies, which would bring an end to steelmaking in Scunthorpe after 160 years of production.
Unite, GMB and Community unions have criticised the move, which is set to leave the UK as the only G7 country without the ability to make steel domestically from scratch.
It comes after the Indian conglomerate Tata announced last September that it was closing its two blast furnaces at Port Talbot in south Wales with the loss of 2,500 jobs.
Liam Byrne, chairman of the Business and Trade Select Committee, said: “The blast furnaces at Scunthorpe are not symbols of the past – they are pillars of the future.
“Keeping them online is not only an industrial decision, it’s a national imperative and so if needed, we will call British Steel’s chief executive Zengwei An to personally explain to Parliament what more is needed to keep the furnaces blazing and the steel rolling.”
The Department for Business and Trade (DBT) and British Steel have been contacted for comment.