UK government seizes control of British Steel to safeguard steel production

Sunday 13 April 2025 - 11:36

By: Zahouani Ilham

UK government seizes control of British Steel to safeguard steel production

The British government took control of British Steel on Saturday, following the swift adoption of an emergency law by Parliament aimed at preventing the closure of its blast furnaces in Scunthorpe, located in northeastern England.

In an extraordinary session, both Members of Parliament (MPs) and Lords debated and passed a bill that grants the Labour government the authority to require British Steel to keep the country's last steel plant operational. The legislation, passed unanimously in both the House of Commons and the House of Lords, quickly received royal assent.

Trade Minister Jonathan Reynolds explained that the move was necessary to prevent the Chinese-owned Jingye Group from shutting down steel production in the UK. He added that the next step would likely involve nationalizing the Scunthorpe plant, which employs 2,700 workers.

Reynolds clarified in the House of Commons that the law does not transfer ownership of British Steel to the government but emphasized that nationalization remains a viable option.

The new law grants the government the power to mandate that any steel company keep its facilities open, with criminal penalties for non-compliant executives. This measure is seen as crucial to preserving the nation’s primary steel production capacity and protecting the 3,500 jobs tied to the industry.

Since acquiring British Steel in 2020, Jingye claims to have invested over £1.2 billion to sustain operations, while facing losses of approximately £700,000 per day. British Steel had announced in late March its intention to close both of its blast furnaces and cease steel production by June, citing financial challenges, particularly due to the 25% tariffs on steel and aluminum imports to the United States.