Sat, 12 Apr 2025

Sat, 12 Apr 2025 Laura Kuenssberg: Can UK afford to save British Steel – and can it afford not to?

The vote later won't determine British Steel's future, but is a first step towards a possible nationalisation.

* The UK government has been negotiating with Jingye, the Chinese owners of British Steel, over the future of the company.
* With coal running out and time passing quickly, the question became whether the government would offer more financial incentives to Jingye or take control itself.
* On Saturday, Parliament will vote on a plan that gives the business secretary, Jonathan Reynolds, power to tell British Steel what to do, effectively allowing the government to keep the company alive.
* However, this doesn't mean the government is taking over British Steel; Jingye will remain shareholders for now.
* The Labour party's decision has kept the industry alive, but it also commits taxpayers to supporting the steel industry in some way.
* There are still many questions about what happens next: whether another company will buy out British Steel, or if the UK government will nationalize the industry.
* Sources suggest that taking control of British Steel would require significant investment - potentially as much as £3 billion per modern electric furnace, and two might be needed for Scunthorpe.
* The cost of energy for new or existing furnaces is also a major concern.
* A Treasury source notes that any nationalization plan must fit within the current spending plans, which are already tight.
* Some politicians believe that nationalizing British Steel would be a necessary step to preserve jobs and industry in Scunthorpe, while others argue it's too expensive or complicated.
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