British Steel is set to return to public ownership as Prime Minister Keir Starmer announced new laws that he says will give the UK government “options” to protect the industry and workers.
New powers could be used to nationalise British Steel, 38 years since the firm was first sold off.
It comes a year after the government used emergency powers to take control of the firm and continue production at the site in Scunthorpe after its owner, Chinese firm Jingye, proposed to close the two blast furnaces.
It has since been in discussions with Jingye but said it could not agree a commercial sale, and that it did not think a deal could be reached that would deliver sufficient value to taxpayers.
The government said it believes introducing legislation to provide a route to public ownership was the right next step and will enable it to make decisions about the steelmaker’s future.
The legislation, which will be brought forward this week, will be subject to a public interest test, which considers factors including national security, maintaining critical national infrastructure and supporting the economy.
“Strong domestic steel production is vital for our economy, and this legislation would allow us to ensure stability for British Steel’s workers, suppliers and customers and avoid damaging disruption to crucial supply chains, while we consider options for the site’s future,” Starmer said.
“The government recognises that securing the long-term future of the UK’s steel sector relies on both public and private investment for modernisation.”
Steel union GMB welcomed the move to nationalise British Steel which it said will “protect it from foreign owners”.
The United Kingdom government’s intervention last year put the breaks on Jingye’s proposals and ended its redundancy consultations, which could have resulted in the loss of between 2000 and 2700 jobs.
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