The blast furnaces at Scunthorpe will keep burning – for now – after Keir Starmer, in one of his final acts as prime minister, brought British Steel into public ownership. The government said the move would protect jobs and safeguard "a vital national capability", ending years of uncertainty over the plant that employs roughly 2,700 people in north Lincolnshire.
The nationalisation, enabled by legislation passed by Parliament on Wednesday, transfers full control from China's Jingye Group to the state. The government had already taken operational control last year, but Jingye's ownership limited its ability to decide on the plant's future strategy. Now, with public ownership, ministers have the power and freedom to decide what happens next – and the immediate priority is keeping the blast furnaces running.
“British Steel nationalised in Starmer's final acts; Jingye may get no compensation.”
Those furnaces, Queen Anne and Queen Bess, are among the oldest in Europe: Queen Anne opened in 1954, Queen Bess in 1938. Both are approaching the end of their operational lives. Allowing them to cool would cause serious damage, and restarting them would cost tens of millions of pounds – a financial impossibility for a company already haemorrhaging money.
British Steel has been losing about £700,000 a day, according to Jingye, which is now seeking compensation for the nationalisation. But an independent assessor will determine whether any payment is due, based on the company's value. The government's own costs are even steeper: a National Audit Office report in March found the Scunthorpe steelworks was costing the taxpayer £1.3m a day.
Business Secretary Peter Kyle told the BBC the government would cover those running costs "for the immediate future" and warned of the alternative. "If that business disappears, we will lose the ability for primary steel production in our country, we will become entirely dependent on global supply," he said. "Let me be really clear, there is an alternative here – that we let this business go bust."
Unite general secretary Sharon Graham welcomed the nationalisation as "the first step in a journey to transform our steel industry", calling for investment to make Britain "a leading producer of green steel". But the government is unlikely to want to remain in charge of a business costing more than a million pounds a day for long. The question now is what comes next – and whether Jingye will walk away empty-handed.
