LONDON (AFP) – The United Kingdom (UK) passed an emergency law to stop the last British factory that can make steel from scratch shutting down, allowing the government to take control of the struggling Chinese-owned British Steel plant.
The site in northern England had faced imminent closure and Prime Minister Keir Starmer said urgent action was needed to prevent its blast furnaces going out and save what is left of the UK’s steel industry.
At a rare weekend session, Parliament approved the legislation without opposition to take over the running of the Scunthorpe site, which employs several thousand people and produces steel crucial for UK industries including construction and rail transport.
The government saw its possible closure as a risk to Britain’s long-term economic security, given the decline of the UK’s once robust steel industry.
As Members of Parliament (MPs) debated in Parliament, Starmer made a dash to the region where he told steelworkers gathered in a nearby village hall that the measure was “in the national interest.” He said the “pretty unprecedented” move meant the government could secure “a future for steel” in Britain.
“The most important thing is we’ve got control of the site, we can make the decisions about what happens, and that means that those blast furnaces will stay on,” he said.
It came after protests at the plant and reports that workers had stopped executives from the company’s Chinese owners Jingye accessing key areas of the steelworks on Saturday morning.
The Times newspaper said British Steel workers had seen off a “delegation of Chinese executives” trying to enter critical parts of the works.
Police said officers attended the scene “following a suspected breach of the peace,” but no arrests were made.
Facing questions about nationalisation, business and trade secretary Jonathan Reynolds told Parliament that state ownership “remains on the table” and may well be the “likely option”.
But he said the scope of Saturday’s legislation was more limited – it “does not transfer ownership to the government,” he explained, saying this would have to be dealt with at a later stage.
Ministers have said no private company has been willing to invest in the plant.
The Chinese owners have said it is no longer financially viable to run the two furnaces at the site, where up to 2,700 jobs have been at risk.
Jingye bought British Steel in 2020 and says it has invested more than GBP1.2 billion (USD1.5 billion) to maintain operations but is losing around GBP700,000 a day.
Reynolds said “the effective market value of this company is zero,” and that Jingye had wanted to maintain the operation in the UK but supply it with slab steel from China to keep it going.
The Labour government came under fire from the opposition Conservative party for its handling of the negotiations and faced calls from some left-wing politicians to fully nationalise the plant.
