The United Kingdom government has officially nationalized British Steel, a move aimed at protecting jobs and securing a vital national capability. The decision, formalized today, places the company under state ownership for the first time since its privatization in 1988.
Ministers stated the nationalization is intended to safeguard thousands of jobs, support industries reliant on UK-made steel, and bolster supply chains, major infrastructure projects, and national security. A new leadership team will be appointed to stabilize the business and develop a commercially sustainable, low-carbon future. Concurrently, an independent assessor will be appointed to determine if the company's former Chinese owner, Jingye, is entitled to any compensation. The Steel Industry (Nationalisation) Act has received Royal Assent, solidifying the state's ownership of the nation's last two blast furnaces at Scunthorpe, North Lincolnshire.
These furnaces produce 3.2 million tons of steel annually, accounting for two-thirds of the UK's current national capacity. The steel is crucial for construction, infrastructure projects, and railway maintenance.
Conservative critics voiced concerns about the potential for further public expenditure, noting that Scunthorpe has been losing approximately £1 million per day since the government assumed control last April to prevent its then-Chinese owners from shutting down the furnaces. Andrew Griffith, shadow business secretary, argued that a "blank cheque from the taxpayer isn't the answer" and criticized Labour's energy policies for impacting the steel industry. He suggested that Jingye should be liable for future decommissioning costs rather than receiving compensation.
Business Secretary Peter Kyle emphasized that British Steel is a major national producer and that nationalization is necessary to maintain steelmaking capability in the national interest. He stated that the company now belongs to the British people and the focus will be on stabilizing the business, supporting its communities, and building a sustainable, competitive, and decarbonized steel sector. Kyle added that allowing the Scunthorpe site, the last producer of virgin steel vital for defense and infrastructure, to close would have made Britain dependent on global markets.
The government's March Steel Strategy outlines plans to invest £2.5 billion in the UK steel industry before 2029 and aims for 50% of steel used in the UK to be domestically produced. However, criticism persists regarding the impact of high energy prices and green levies on the sector.
The Department for Business and Trade confirmed that an independent assessor will review compensation claims from Jingye, with draft regulations expected in the autumn. Trade unions have supported the renationalization, with Community General Secretary Roy Rickhuss stating the move will safeguard jobs and provide stability. British Steel Interim CEO Allan Bell called it a "momentous day," and Gareth Stace, director general of UK Steel, described the public ownership as the "right move," urging the next government to prioritize a long-term plan for the sector's sustainability and investment in modern, low-carbon steelmaking.