Full nationalisation of British Steel expected in King’s speech | British Steel
The full nationalization of British Steel is expected to be announced in the King’s speech this week, a year after the government took over the day-to-day running of the loss-making business from its Chinese owner.
The steelmaker, which employs 3,500 people at its site in Scunthorpe, came under government control last April amid fears that owner Jingye was planning to close the plant.
British Steel operates the last two remaining blast furnaces in the UK, but economic control remains with the Chinese company, which bought it out of bankruptcy in early 2020.
According to the Sunday Times, an announcement confirming the plans is expected to be made in the King’s speech on Wednesday, but details of the speech are still being finalised.
British Steel was acquired by private equity group Greybull Capital in 2016 but collapsed into bankruptcy three years later. It was acquired by Jingye in March 2020.
The Chinese company had originally planned to build an electric arc furnace in Scunthorpe and one at a site on Teesside, but negotiations with the government ultimately failed. Jingye then attempted to shut down the blast furnaces in April 2025.
The closure of the British Steel plant would end Britain’s “primary” steelmaking capability, as blast furnaces allow metal to be made from scratch rather than relying on scrap.
However, as of the end of January this year the cost of keeping British Steel running had risen to £377 million and could exceed £1.5 billion by 2028 if it continues at the current pace, the National Audit Office estimates.
The company attracted interest from potential buyers when Miami-based retail investor Michael Flacks expressed “very” interest in buying it in February.
Earlier this month, Sev.en Global Investments, owner of Britain’s largest electric steelworks, suggested the government should find a single buyer for British Steel and Specialty Steel UK, a move that would create the country’s largest steelmaker.
Although the sector is much smaller than at its peak in the 1970s, British Steel remains a major employer in Scunthorpe, supporting tens of thousands of jobs across its extended steel supply chain. Network Rail gets around 95% of its line from the facility.
The original British Steel was founded in 1967 when Harold Wilson’s Labor government nationalized more than a dozen private companies to create one of the world’s largest steel producers.
It was privatized and dismantled by Margaret Thatcher’s government, but its final version was plagued by high costs and competition from abroad.
A government spokesman said: “We have made clear that protecting steel production in the UK is our priority. We continue to engage in discussions with Jingye to agree a pragmatic and realistic solution to secure the long-term future of the Scunthorpe site. Discussions are ongoing and no conclusions or decisions have yet been reached.”
