MPs have approved emergency legislation to save British Steel’s Scunthorpe plant in an extraordinary sitting in the House of Commons today after calling on the Government to nationalise the Chinese owned firm to re-ignite the UKs steel industry. 

The emergency law, which would give Government the power to instruct British Steel in a bid to keep the plant open, was passed unopposed in the Commons earlier today, and is now set to be debated by the Lords.

Both the Commons and the Lords reconvened during Easter recess for a highly unusual Saturday sitting to debate a Bill aimed at blocking British Steel owners Jingye from closing blast furnaces at the Scunthorpe site.

The plans would see taxpayer money used to provide materials to the steelworks and open the door to a transfer of ownership after Sir Keir Starmer warned the future of the firm ‘hangs in the balance’. 

The Bill stops short of full nationalisation of British Steel, and ministers remain hopeful that they can secure private investment to save the plant. 

There is currently no private company willing to invest in British Steel and the Business Secretary acknowledged to the Commons that public ownership remained the ‘likely option’.

Business Secretary Jonathan Reynolds took a swipe at the Chinese firm, which purchased the British Steel in 2020, saying they had ‘irrevocably and unilaterally closed down primary steel making’ in the UK. 

It comes amid fears the Scunthorpe plant could close its doors in the next ten days, following a warning from unions that Jingye had cancelled orders for raw materials needed to make steel.

Mr Reynolds said: ‘Despite our offer to Jingye being substantial, they wanted much more. Frankly, an excessive amount. We did however remain committed to negotiation.

‘But over the last few days, it became clear that the intention of Jingye was to refuse to purchase sufficient raw material to keep the blast furnaces running, in fact, their intention was to cancel and refuse to pay for existing orders.

‘The company would therefore have irrevocably and unilaterally closed down primary steel making at British Steel.’

Conservative MP for Chingford and Woodford Green, Sir Iain Duncan Smith, also hit out at the Chinese bosses, saying they had been ‘pushing forward to shut down the blast furnaces in the UK. 

Speaking to the Commons, he said ‘far too many countries like Chine have abused the rules of the free market… and have used slave labour to produce products. When that happens, the free market is dead.’

He said it was not a surprise Jingye had been pushing for Scunthorpe’s closure due to China suffering ‘from an overproduction of steel, adding: ‘They know that we will have to buy slab steel from China. This is not a coincident. This is all part of the plan.’ 

Reform UK’s deputy leader Richard Tice called on the cabinet member to ‘show your cojones’ and nationalise British Steel, claiming it could become a ‘long-term, viable’ asset for the taxpayer.

‘We will support this government in this bill today. But there is an opportunity to go further, to be bold, be courageous,’ he added. 

Former Labour Leader Jeremy Corbyn went even further and called on ‘the whole steel industry’ to be taken into public ownership, saying it could be ‘the bedrock of the manufacturing industry in Britain’. 

Elsewhere in Scunthorpe, fans of the local football club as well as residents took to the streets in support of the steel workers as they all marched towards their local sporting ground.  

Workers, who were visited earlier today by Prime Minister Sir Keir Starmer, have stopped Chinese bosses from accessing key areas of the steel plant, with police officers being called to force Jingye executives from the site, the Times reported. 

Humberside Police said: ‘Officers were in attendance at British Steel in Scunthorpe at 8.30am this morning following a suspected breach of the peace.

‘Upon attending, conducting checks and speaking to individuals in the area, there were no concerns raised and no arrests were made.’

Mr Reynolds said a transfer of ownership to the state ‘remains on the table’ and may well be the ‘likely option’ for British Steel, although noted the Government could not fund the long-term transformation of the company. 

Outlining the circumstances around the debate, Mr Reynolds said Labour had been negotiating with Jingye in good faith, but they wanted an ‘excessive amount’ from the British Government.

The Steel Industry (Special Measures) Bill gives the Government the power to instruct steel companies in England to keep facilities open, with criminal penalties for executives if they fail to comply.

Ministers said these measures were necessary to keep the Scunthorpe blast furnaces open and protect both the UK’s primary steelmaking capacity and the 3,500 jobs involved. 

But Conservatives said the Government should have acted sooner, with shadow leader of the House Alex Burghart accusing ministers of making ‘a total pig’s breakfast of this whole arrangement’. 

Shadow business secretary Andrew Griffith said the Government was seeking a ‘blank cheque’, while Tory leader Kemi Badenoch claimed Labour had ‘botched’ a deal she had negotiated with British Steel while business secretary. 

But she was unable to provide details of the deal, saying negotiations were still ongoing when last year’s election was called, but adding it ‘would have succeeded better’ than Mr Reynolds’s plan. 

Mr Reynolds said: ‘We meet under exceptional circumstances, to take exceptional action, in what are exceptional times.

‘Our request to recall Parliament was not one we have made lightly, and I am grateful, genuinely grateful to honourable members on all sides of this house for their cooperation and for being here today as we seek to pass emergency legislation that is unequivocally in our national interest.

‘Despite our offer to Jingye being substantial, they wanted much more. Frankly, an excessive amount. We did however remain committed to negotiation.

‘But over the last few days it became clear that the intention of Jingye was to refuse to purchase sufficient raw material to keep the blast furnaces running, in fact, their intention was to cancel and refuse to pay for existing orders.

‘The company would therefore have irrevocably and unilaterally closed down primary steel making at British Steel.’

The Business Secretary continued: ‘The British Government offered to purchase raw materials in a way that would have ensured no losses whatsoever for Jingye in maintaining the blast furnaces for a period of time.

‘A counter offer was instead made by Jingye to transfer hundreds of millions of pounds to them, without any conditions to stop that money and potentially other assets being immediately transferred to China.

‘They also refused a condition to keep the blast furnaces maintained and in good working order.’

Mr Reynolds described the legislation as a ‘proportionate and necessary step’, telling MPs: ‘It allows us to take control of British Steel’s blast furnaces, maintaining steel production and by extension protecting the company’s 3,500-strong workforce.

‘The Bill does not transfer ownership to the Government. We’ll have to deal with this matter at a later date. I took the decision that given the exceptional nature of a recall, it would be better to limit the powers in this Bill, which are still significant, rather than introduce more complex matters of property rights and public ownership at this time.’

Conservative former minister Sir Jeremy Wright warned the Government risked ‘creating some considerable legal complexity’ in terms of the operation of steel companies.

Mr Reynolds, in his reply, said: ‘I want this to be a temporary position, I do not want these powers any minute longer than is necessary but I do need these powers to rectify and save this situation.’

Mr Reynolds said transfer of ownership to the state ‘remains on the table’ and may well be the ‘likely option’ for British Steel, although noted the Government could not fund the long-term transformation of the company. 

Saturday’s emergency legislation stops short of full nationalisation of British Steel, and ministers remain hopeful that they can secure private investment to save the plant. 

But, speaking to the BBC, industry minister Sarah Jones conceded there were currently no companies willing to make an offer, while in the Commons Mr Reynolds acknowledged that public ownership was ‘the likely option’.

Ms Jones also insisted there would be ‘no extra cost to the Exchequer’ as a result of the Government’s actions, with costs being met from a £2.5 billion steel fund announced at last year’s budget.

Earlier, speaking to Sky News on Saturday morning, Minister for Industry Sarah Jones suggested negotiations with Jingye had broken down, accusing the company of failing to act ‘in good faith’.

She added Jingye has ‘refused’ to bring in the raw materials needed to keep the blast furnaces operating, claiming the site has seen ‘significant’ financial losses since purchasing British Steel in 2020. 

Saturday’s emergency legislation will also provide for criminal sanctions if executives fail to comply with instructions to keep the blast furnaces open.

Ms Jones said the Government would ‘step in’ if British Steel’s owners did not co-operate, with the company ‘liable for any costs that we incur’.

She said: ‘This problem has now become existential because the company have refused to bring in the raw materials that we need to keep the blast furnaces operating. 

‘If blast furnaces are closed in an unplanned way, they can never be reopened, the steel just solidifies in those furnaces and nothing can be done.

‘So the choice that is facing MPs today is do we want to take back control, to give the Business Secretary the power to act as a company director and to instruct the company to ensure we get the raw materials and we keep the blast furnaces operating, or do we want to see the end of primary steel making in this country and the loss of jobs?’

She added: ‘We have the £2.5 billion fund for steel which we had in our manifesto, that we will use if necessary, so there will be no extra costs to the Exchequer that we don’t already have in our plans.’ 

Jingye, which bought British Steel in 2020, has said it invested more than £1.2 billion to maintain operations amid ongoing production instability and ‘significant’ financial losses of around £700,000 a day.

The proposals to close Scunthorpe’s furnaces had sparked fears of job losses at the plant, which employs thousands of people.

Business Secretary Jonathan Reynolds said Jingye had confirmed the plans despite months of talks and a £500 million co-investment offer from Government, leaving ministers ‘no choice’ but to act to spare job losses and save the plant.

Ministers hope to secure private investment to save the plant in the longer term, but Ms Jones admitted on Saturday that there were currently no companies willing to make an offer.

Saturday’s legislation is intended to provide an urgent temporary solution in the face of the threat to close the blast furnaces at Scunthorpe until a longer-term plan is agreed, and full nationalisation remains an option.

Unions welcomed the move but Tory leader Kemi Badenoch accused Labour of having ‘bungled the negotiations’ and said ‘their incompetence has led to a last-minute recall of Parliament’.

Liberal Democrat Sir Ed Davey called the debate an opportunity to advance ‘a serious plan for the sustainable future of domestic steel production’ while Reform UK leader Nigel Farage reiterated his backing for nationalisation.

The Commons sitting will begin at 11am and the House of Lords from midday in the first parliamentary recall on a Saturday since 1982, when MPs returned after the start of the Falklands War.