“All options” remain on the table over the future of British Steel, the chancellor has said, as fears mount over the company’s plant in Scunthorpe.
The government is actively considering nationalising British Steel after Jingye, its owner in Scunthorpe, cancelled future orders for the iron ore, coal and other raw materials needed to keep the furnaces running.
The decision has led to fears that the Scunthorpe plant, the last blast furnaces left operating in Britain, could be forced to close as early as next month.
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Speaking to reporters in Bedfordshire, Rachel Reeves suggested nationalisation could be an option to secure the future of British Steel in Scunthorpe, which was purchased by Jingye out of receivership in 2020.
“All options remain on the table regarding British Steel,” she said.
“This government recognises the importance of those jobs in Scunthorpe and in the local area, and we’re doing everything we can to preserve those jobs and to support those communities.
“We’re in conversation both with the owners and with the trade unions to find a deal.”
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On the issue of whether the plant could secure access to the raw materials it needed to run the blast furnaces, the chancellor said the government was in “active discussions now with both the owners and the trade unions”.
Fears over the Scunthorpe plant’s future intensified after talks between the government and Jingye broke down last week after the Chinese company rejected a £500m offer of public money to replace the existing furnaces with electric arc furnaces.
The government offered the same amount to Tata Steel, the owner of the steelworks in Port Talbot, which shut down both of its blast furnaces last year and is replacing them with electric arc furnace as part of its transition to greener production methods.
Conservative leader Kemi Badenoch has urged the government to push for a “commercial solution” to save the Scunthorpe plant, to avoid “pain on the British taxpayer”.
She drew comparisons with the Port Talbot steel plant, arguing that she saved it with a £500m rescue package that helped Tata Steel employees facing redundancy as it moved away from blast furnaces to greener steel production.
“It was difficult, but we saved that steel plant,” she said.
“And it’s going to thrive, and it’s going to regenerate the area. Yes, some jobs were lost, but worked for a commercial decision that did not put too much pain on the British taxpayer.”
She said was “amazed that nine months in, Labour have lost British Steel”.
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“And now they’re talking about nationalisation – I want to see what the commercial options are,” she continued.
“They should also be trying to make sure that they reduce tariffs on steel across the board and stop the excessive dumping from China.
“China dumping steel across the world is making steel very cheap from there and more expensive for everyone else. That needs to change. If we’re going to be using steel in our country, we need to be competitive.”
The questions over the steel plant in Scunthorpe comes as ministers hailed a deal for a new Universal theme park in Bedfordshire, which Ms Reeves said would bring “billions” to the economy and create thousands of jobs.
It will be the first Universal-branded theme park and resort in Europe and is set to open in 2031, when it is expected to become the UK’s most popular visitor attraction.
Reform UK leader Nigel Farage welcomed the investment but said: T”he new Universal theme park should be made with only British steel.”
