Parliament approves emergency powers to take control of Scunthorpe steelworks

Proposals to save British Steel’s Scunthorpe blast furnaces have been approved by Parliament after an extraordinary sitting on Saturday.

Emergency legislation giving the Government the power to instruct British Steel to keep the plant open passed both the Commons and Lords in a single day unopposed.

Ministers had taken the unusual step of recalling Parliament from its Easter recess to sit on Saturday after negotiations with British Steel’s Chinese owners, Jingye, appeared to break down.

Business Secretary Jonathan Reynolds accused the company of failing to negotiate “in good faith” after it decided to stop buying enough raw materials to keep the blast furnaces at Scunthorpe going.

He told MPs: “We could not, will not and never will stand idly by while heat seeps from the UK’s remaining blast furnaces without any planning, any due process or any respect for the consequences.

“And that is why I needed colleagues here today.”

Ministers had feared the Scunthorpe plant would close within days after its Chinese owners cancelled orders for the raw materials needed to keep making steel (Peter Byrne/PA). PA Media

But the Conservatives said the Government should have acted sooner, with shadow leader of the House Alex Burghart accusing ministers of making “a total pig’s breakfast of this whole arrangement”.

Shadow business secretary Andrew Griffith said the Government was seeking a “blank cheque”, while Tory leader Kemi Badenoch claimed Labour had “botched” a deal she had negotiated with British Steel while business secretary.

But she was unable to provide details of the deal, saying negotiations were still ongoing when last year’s election was called, but adding it “would have succeeded better” than Mr Reynolds’s plan.

Opening Saturday’s debate, Reynolds said Labour had been engaged in negotiations with Jingye since the party came to power last July, and had offered “substantial” support.

Most recently, the Government had offered to purchase the necessary raw materials for the blast furnaces, the last primary steel-making facilities in the UK, but this had been met with a counter offer from Jingye demanding “an excessive amount” of support.

Jonathan Reynolds said Jingye had demanded an ‘excessive’ amount of support, and offered no guarantee the blast furnaces would be maintained (House of Commons/UK Parliament). PA Media

Reynolds continued: “Over the last few days, it became clear that the intention of Jingye was to refuse to purchase sufficient raw material to keep the blast furnaces running – in fact, their intention was to cancel and refuse to pay for existing orders.

“The company would therefore have irrevocably and unilaterally closed down primary steelmaking at British Steel.”

While MPs debated the legislation, The Times newspaper reported that workers at the Scunthorpe plant had prevented Chinese executives from Jingye from gaining access to key areas of the steelworks.

The Steel Industry (Special Measures) Bill published on Saturday gives the Government the power to instruct steel companies in England to keep facilities open, with criminal penalties for executives if they fail to comply.

Ministers said these measures were necessary to keep the Scunthorpe blast furnaces open and protect both the UK’s primary steelmaking capacity and the 3,500 jobs involved.

Reynolds said the emergency legislation was a “proportionate and necessary step”, adding he wanted it to be a “temporary position” with the powers not lasting “any minute longer than is necessary”.

Meanwhile, Sir Keir Starmer met with steelworkers near Scunthorpe to discuss his Government’s plans for the plant.

Sir Keir Starmer told steelworkers they had been ‘the backbone of British Steel’ as he met them in a village hall near Scunthorpe (Peter Byrne/PA). PA Media

The Prime Minister told them: “You are the people who have kept this going. You and your colleagues for years have been the backbone of British Steel, and it’s really important that we recognise that.”

Saturday’s emergency legislation stops short of full nationalisation of British Steel, and ministers remain hopeful that they can secure private investment to save the plant.

But there is currently no private company willing to invest in British Steel, and the Business Secretary acknowledged to the Commons that public ownership remained the “likely option”.

During Saturday’s debate, Reform UK’s deputy leader Richard Tice urged the Government to “show your cojones” and go further by fully nationalising British Steel “this weekend”.

Several Conservative MPs also spoke in favour of nationalisation, while Liberal Democrat Treasury spokeswoman Daisy Cooper said recalling Parliament had been “absolutely the right thing to do”.

Meanwhile, the Government has been criticised for acting to save the Scunthorpe plant but not taking the same action when the Tata Steel works in Port Talbot were threatened with closure.

Liberal Democrat Wales spokesman David Chadwick said workers in South Wales “will be asking themselves how this unjust situation was ever allowed to occur”.

Earlier, industry minister Sarah Jones said the different approach was due to Tata’s willingness to invest in Port Talbot, and the changed global circumstances making it necessary to protect the UK’s primary steelmaking capacity.