Contribution
I thank the noble Lord, Lord Fox, for his question, and for acknowledging the pace of action to which many of us in this House responded. It really was a significant event, from a number of people, and I also extend my thanks in that regard.
Steel is vital to the UK, and this Government were elected with a clear mandate to rebuild the steel industry after a decade of neglect, and to support steel-workers, their families and their communities for generations to come. We have committed £2.5 billion to doing so in addition to £500 million for Port Talbot.
Resolving the years of uncertainty surrounding the future of the Scunthorpe steelworks has been a priority since our first days in office. We have worked tirelessly with Jingye and the trade unions to find a resolution for British Steel which protects jobs and ensures ongoing steel production. This included making a generous conditional offer of financial support and offering to pay for all of the company’s raw materials—offers which Jingye, British Steel’s owners, did not accept.
On 12 April, the Government took the decision to recall Parliament so that we could take urgent action on British Steel. As noble Lords will be aware, this was the first time that this House has sat on a Saturday in over 40 years. Attendance in this place was testament to the significance of the issue at hand, which was to stop the immediate closure of the blast furnaces at Scunthorpe.
The noble Lord, Lord Hunt, asked about the specific steps that we have taken since the Steel Industry (Special Measures) Act was passed on 12 April. As noble Lords are aware, the legislation gives government the power to direct British’s Steel’s board and workforce, to ensure they get paid and to order the raw materials to keep the blast furnaces running. It also permits the Government to do these things themselves if the circumstances demand it.
We have wasted no time in enacting these powers and taking the urgent action required to keep the furnaces lit at Scunthorpe. Officials were on site to help British Steel within hours of the Steel Industry (Special Measures) Act becoming law, and we are already seeing the real-world impact of our decisive intervention. As a result, we have secured the raw materials needed to keep blast furnaces operating for the coming weeks, and we continue to work at pace to secure a steady pipeline of materials. I am delighted to say that British Steel confirmed on Tuesday that it can keep operating both of the UK’s last remaining blast furnaces, in contrast with the plans of the owners, Jingye, to shut one of them down earlier this month. These actions matter greatly for this country and are of enormous importance to thousands of steel-workers and their families. I am very pleased that British Steel also confirmed on Tuesday that it has cancelled the redundancy consultations started by Jingye.
Now that the immediate emergency at Scunthorpe has been resolved, it is right that noble Lords ask questions about what is next. Officials met with Jingye on 16 April. It was a respectful conversation, and that dialogue will continue as we find a way forward, in the national interests, that safeguards steel-making and protects jobs. However, as the Minister for Industry stated on Tuesday in the other place, British Steel has suffered years of underinvestment. To secure its long-term future, we will need a modernisation programme, ideally with a private sector partner. Furthermore, we will need to look beyond any individual company and ensure a secure and thriving future for the whole steel sector, which is why we are continuing our work to publish the steel strategy this spring.
I understand the points about the financial implications of our intervention in British Steel. In the interests of transparency, the Department for Business and Trade accounts for 2025-26 will of course reflect the financial support that the department has given to British Steel. It is also important to recognise that allowing British Steel to collapse was not a no-cost or low-cost option; it would have had far-reaching economic consequences, including the loss of thousands of jobs in an economically vulnerable area. The Government’s intervention to prolong blast furnace operations at Scunthorpe was a necessary investment in the future of our economy and national security.
While the situation at British Steel has developed rapidly, we have also been working tirelessly to address the long-term sustainability and competitiveness of our steel sector. Our robust industrial strategy will be complemented by our steel strategy, due to be published in the spring, which will address the complex issues facing the industry, many of which the noble Lord, Lord Fox, acknowledged, including ageing infrastructure, high energy costs and intense global competition.
We have assured this House that steel remains a priority under this Government. Steel is fundamental to Britain’s industrial strength, and British Steel has a central role to play. As we move forward, we will keep both Houses informed with regular written updates as policy develops and our longer-term strategy takes shape. I will speak to the Chief Whip about making a commitment that it will be debated here.
To conclude, I reiterate the words of the Minister for Industry that
“steel has a bright future under this Government”.
This week is not the end: it is not the end of the work or the negotiations and, thanks to the actions we have taken, it is also not the end of British Steel.