UK urges British steel to continue talks to secure its future

THE UK government urged British Steel to continue talks to secure its future, following reports that the company is considering shedding 800 jobs at its site in Scunthorpe, northern England.

British Steel is owned by China’s Jingye Group.

“I would encourage the company to continue discussions with us to reach a solution,” Business Minister Nusrat Ghani said in the House of Commons on Thursday (Feb 2). “The government has put forward a generous package of support.”

The UK has been close to agreeing to a £300-million (S$482-million) package to help British Steel cut its carbon emissions and prevent thousands of job losses, as the steelmaker struggles with high energy and carbon prices. Prime Minister Rishi Sunak’s administration is concerned that the company’s demise could create significant decommissioning liabilities, and undermine domestic steel production. 

Ghani said that any decision Jingye makes on the future of its UK operations is a “commercial” one, but said that the UK government will ensure that support is available to help employees. The company itself has been offered £120 million in grants to ensure that it can stay in Scunthorpe, as well as export finance, protections for domestic production, and support for energy costs.

On Wednesday, Sky News reported that British Steel is drawing up plans for 800 redundancies, despite the ongoing talks with the government. BLOOMBERG