The largest UK steelworkers' union has called for the Government to nationalise British Steel if a deal cannot be reached with its owners, Jingye Group.
On Thursday, British Steel launched a consultation with its workforce and unions on the closure of its coke blast furnaces, wider steelmaking operations and to scale back its steel rolling mill capacity at Scunthorpe. Up to 2,700 jobs could go as early as June.
It followed the collapse of talks between Jingye and the Government over a support package for the company as it looks to secure a sustainable future by decarbonising. Business Secretary Jonathan Reynolds made an offer on Monday to Jingye, thought to be worth £500m.
Trade unions have reacted with dismay to the consultation announcement by British Steel and urged its owners and the Government to reach a deal. Now Community has gone further, calling for British Steel's nationalisation if a deal is not possible.
Community assistant general secretary Alasdair McDiarmid said today: "British Steel is a business of huge strategic importance, not just to the local economy and the wider steel sector, but to the country as a whole. There is now a serious risk that the UK will become the only G7 country unable to produce its own virgin steel. This would be a totally unacceptable situation at any time, let alone in the current era of global insecurity and volatility.
"If a deal can't be reached with Jingye, then the government must move to nationalise the business. This government cannot afford to renege on the commitments it has made to steelworkers, and it is unthinkable that they would allow Britain's primary steelmaking capacity to die on their watch."
Virgin, or primary steel, is steel made from raw materials. British Steel's plans since November 2023 have been to replace its coke blast furnaces in Scunthorpe with electric arc furnaces (EAFs). These can make the same steel products, but use recycled steel.
In yesterday's Urgent Question on the future of British Steel in Parliament, triggered by Martin Vickers MP (Conservative - Brigg and Immingham), a number of MPs emphasised the importance of virgin steel-making. "For the last 150 years, wars have been won by states who can make virgin steel," said Sir Edward Leigh MP (Conservative - Gainsborough).
"It's now clear that domestic virgin steel production is a national imperative," said Graham Stuart MP (Conservative - Beverley and Holderness). Industry Minister Sarah Jones said: "We make a lot of our steel for defence not from primary steel, we make a lot of it from electric arc furnaces. It's about getting the right mix and that is what we will make sure we do."
She confirmed the Government "is investigating the merits of investing in DRI, which is where you use hydrogen instead of the old blast furnaces" to make primary steel. Mr Vickers told Scunthorpe Live after the Urgent Question he felt "there was clearly a consensus across the House that we must maintain the ability to produce virgin steel, particularly for use in the defence sector."
Ms Jones did not rule out nationalisation yesterday as an option, but the Government's "preferred approach, by far, is that British Steel come back to the table with us".
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