Tories reject calls to nationalise British Steel as crisis talks continue

Ministers were today urged to nationalise British Steel unless a rescue deal can be thrashed out to save 4,500 jobs.

Unite said it would be an “economic catastrophe” if the company went out of business.

And Labour leader Jeremy Corbyn warned: “The collapse of British Steel would be devastating for thousands of jobs in Scunthorpe, as well as in the wider supply chain.

“The Government must act to secure the long term future of the steelworks – protecting people’s livelihoods and the community.”

Reports suggest the firm, which employs 4,000 workers at its Scunthorpe plant, could plunge into administration tomorrow unless ministers stump up cash.

British Steel, formed in 2016 after it was rescued by investment firm Greybull Capital, received a £120million loan to pay an EU emissions bill last month.

Now it needs a fresh £30million loan money to avoid collapse, which would jeopardise 20,000 jobs in its supply chain.

Unite assistant general secretary Steve Turner said: “While Unite is in continuing dialogue with British Steel and the UK Government, we are very clear that if a deal cannot be struck to secure the long-term future of the steelmaker under private ownership, that the Government must bring it under public control in the national interest.

“British Steel’s success is key to any future UK industrial strategy.

“It is a strategically important business which supplies other UK steelmakers with product and provides 95% of the UK’s rail tracks.

“It would be an economic catastrophe if the worst were to happen and Government was to allow British Steel to collapse.

“It is a national asset supporting UK plc that cannot simply be left to the market.”

Grilled in the Commons, Business Minister Andrew Stephenson claimed the Government believed the sector was “fundamentally important to British industry” and vowed to “leave no stone unturned” as it tried to agree a plan with the firm.

But rebuffing calls for the Government to take over ownership, he added: “Nationalisation isn’t the answer here.”

Asking if the Government had considered bringing the firm into public ownership, Shadow Steel Minister Gill Furniss told MPs: “The UK steel industry is critical to our manufacturing base and protecting this industry should be of paramount importance to the Government.”

Furious Labour MP Rachel Reeves, who chairs the Commons Business Select Committee, fumed: “This Government has presided over the decline of the UK steel industry – the closure of Redcar in 2015, the lack of assurances got from Greybull when they took over British Steel, the chaotic handling of Brexit and the failure to agree a sector deal with the steel industry, which they have been crying out for.

“The Government have a chance now to right some of those wrongs.”

Scunthorpe MP Nic Dakin warned the “stakes are too high” for efforts to save the company to fail.

UK Steel director Gareth Stace said: “Despite the challenges the sector faces at the current time, the outlook for steel demand and consumption in the UK, and across the globe, remains positive.

"Economies around the world continue to require increasing volumes of steel and the UK sector stands ready and able to supply high quality products to meet this demand.

"Indeed the Government’s own study from 2017 showed an additional £4bilion a year opportunity for the sector in the UK alone.

“We must remember the steel industry is an enduring resilient one, we have been the bedrock of the UK’s industrial landscape for 150 years since we pioneered mass steel production techniques, through to today and for the future.

"There is no reason why this should not continue to be the case for many years to come.”

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