A crucial meeting is scheduled for Monday between British Steel staff and civil servants in a desperate attempt to save Britain’s last primary steelmaking plant from permanent closure.
The government took control of the company on Saturday, inheriting a precarious situation. The immediate challenge is securing essential raw materials, including coking coal and iron ore, to keep the two blast furnaces at the Scunthorpe plant operational.
Failure to obtain these materials will lead to the cooling of the furnaces, potentially causing irreparable damage and ending steelmaking in the Lincolnshire town.
On Sunday, Business Secretary Jonathan Reynolds was unable to guarantee this would not happen but said taking over the plant had given the Government “a chance” to save it.
Dozens of businesses, including Tata and Rainham Steel, have rallied to help British Steel with offers of managerial support and raw materials following the Government’s takeover.
Mr Reynolds said: “When I said steelmaking has a future in the UK, I meant it.
“That’s why we’ve passed these new powers to save British Steel at Scunthorpe, and that’s why my team are already hard at work on the ground to keep jobs going and furnaces burning.”
The need to secure raw materials and prevent the blast furnaces cooling was the primary reason for the Government recalling Parliament on Saturday to pass emergency legislation to keep the site open.
Jingye, British Steel’s Chinese owners, had not only stopped ordering raw materials but had begun selling off existing supplies, sparking concerns the plant could close within days.
Officials from the Department for Business and Trade (DBT), along with British Steel staff, will spend Monday working to bring nearby materials on to the site, as well as ensuring staff continue to be paid, the department said.
The offers of support from other businesses also mean that British Steel is reassessing its options.
This includes possibly reversing Jingye’s decision to take one of the blast furnaces temporarily offline as early as Monday using a “salamander tap”, a procedure said to be dangerous.
Ministers remain hopeful that a private investor can be found for British Steel, with the cost of modernising the Scunthorpe plant expected to run into billions of pounds.
But over the weekend, Mr Reynolds admitted that full nationalisation remained the most likely option in the short term.
He said: “Steel is vital for our national security and our ambitious plans for the housing, infrastructure and manufacturing sectors in the UK.
“We will set out a long-term plan to co-invest with the private sector to ensure steel in the UK has a bright and sustainable future.”
However, the Conservatives have accused the Government of acting “too late” and implementing a “botched nationalisation” after ignoring warnings about the risk to British Steel.
Shadow business secretary Andrew Griffith said: “The Labour Government have landed themselves in a steel crisis entirely of their own making. They’ve made poor decisions and let the unions dictate their actions.”
