MPs debate emergency law to take control of British Steel after Chinese owners’ ‘excessive’ demands – live | Politics
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- April 12, 2025
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Business secretary says Jingye wanted ‘excessive amount’ from the government
Jonathan Reynolds said the government had been negotiating with Jingye in good faith, but said the Chinese company wanted an “excessive amount” from the government.
The PA news agency reports that the business secretary said:
As honourable members will know, since taking office this government has been negotiating in good faith with British Steel’s owners Jingye.
We have worked tirelessly to find a way forward, making a generous offer of support to British Steel that included sensible, common sense conditions to protect the workforce, to protect taxpayers’ money and create a commercially viable company for the future.
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.”
Earlier Reynolds opened the second reading of the steel industry (special measures) bill, by saying:
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.”
Key events
Edward Leigh has called on the government to “get real” over the energy costs paid to run steelworks in Scunthorpe.
The Conservative MP for Gainsborough in Lincolnshire asked:
Why are we loading the most expensive energy costs on our own steel production?”
He later added:
We have to stop these green energy costs. We have to be realistic.”
Leigh added he supported the bill and that he wanted a sunset clause to business secretary Jonathan Reynolds’ powers, and told the Commons:
We have to get real about China, too.
Was it not obvious for weeks, indeed for months, that this company, this so-called private company – there is no such thing as a private company in China, they’re under the cosh of the government under an autocratic regime – what do they care about the steelworkers in Scunthorpe?”
Labour MP Diane Abbott had earlier said “some of us hope that moving on to nationalisation will not be ruled out”.
The MP for Hackney North and Stoke Newington said:
British Steel supplies Transport for London (TfL) with the power rail London uses on the transport network, which is not currently manufactured anywhere else in the country.
For railways like the underground, power rail from British Steel is essential to the everyday operation of the service, which supports up to four million customer journeys each day.
The closure of British Steel would have a very serious adverse effect on TfL services, as it would have a serious effect on projects up and down this country.”
UK-made steel is needed “to keep Britain secure at home and strong abroad”, a business minister has told parliament.
Margaret Jones made her comments as the House of Lords and House of Commons were recalled from the Easter recess for an extremely rare Saturday sitting to debate legislation aimed at blocking the British Steel’s Chinese owners, Jingye, from closing blast furnaces at its Scunthorpe plant.
Lady Jones told peers:
This government will never hesitate to take action to protect this nation’s assets.
We will not abandon the hard working steelmaking communities that have given so much to both our economy and our country.
Where vital industries are on the verge of collapse or where communities face devastation we will always act in the national interest.”
She added:
We do not accept the argument that steelmaking has no future in the UK.”
Pointing out British steel was needed for major developments and critical infrastructure projects, including rail and renewable schemes, she said:
We need it to keep Britain secure at home and strong abroad.”
Liberal Democrat Treasury spokesperson Daisy Cooper has said some Conservative MPs’ calls for steel nationalisation “shows just how through the looking-glass we really are”.
She told the Commons that recalling parliament “is absolutely the right thing to do”, adding:
It is quite astounding that even after British Steel was sold for £1, even after British Steel entered insolvency, even after the government’s insolvency service temporarily ran the firm, the Conservatives pressed ahead to erect more trade barriers through their botched Brexit deal, they scrapped the industrial strategy council, and allowed the sale of the steel plant to a Chinese firm, which now, according to ministers, is refusing to negotiate in good faith to at least keep the plant going.”
Cooper later added:
Under the terms of this bill, the secretary of state [Jonathan Reynolds] is giving himself huge and unconstrained powers, which could set a very dangerous precedent.
I urge the secretary of state in the strongest possible terms to make a simple commitment today that the powers that he is giving himself will be repealed as soon as possible, within six months at the latest, and if they are still required after that, whether he will come back to this house to ask for another vote if he wants to extend them.”
The business secretary, Jonathan Reynolds, intervened and said “the limitation – wide as they are – is the right measure”, adding: “I’ll seek to do exactly that.”
Cooper later said:
The fact that it is some Conservative MPs calling for nationalisation really shows just how through the looking-glass we really are.”
Labour MP Liam Byrne, who chairs the business and trade committee, said the bill was about “saving British Steel” as he commended the government for bringing it forward.
He told the Commons:
At the heart of this debate is actually a very simple question – can we entrust a critical national asset to a company that we do not trust? I say no, we cannot, we must not and we dare not.
We are faced with a very simple challenge – in British Steel’s owners we have a company in possession of an asset that we need yet it is a partner that we do not trust. In a world where threats to our economic security multiply each day, we cannot allow that risk to fester at the heart of our industrial core.”
Shadow business secretary says MPs being asked to sign off ‘blank cheque’ for British Steel intervention
Shadow business secretary, Andrew Griffith, said the government was asking MPs to sign off a “blank cheque” for its British Steel intervention, reports the PA news agency.
He told the Commons:
From midnight the chancellor will be standing behind the payroll, settling every bill with every supplier even if they are in arrears. If these decisions no longer sit with the plant’s owner, where does the buck stop? The Old Admiralty Building? The Treasury? No 10?
And how can other steel providers have any confidence in the impartiality of the government’s steel strategy if the umpire is now on the pitch? What assessment has the government made of the impact of this bill on public finances? There is no impact assessment.
The government has been talking to British Steel for nine months, they put at least £500m of taxpayers’ money on the table, surely by now [Jonathan Reynolds] and his officials have a comprehensive understanding of the costs of the actions he is asking us to vote on.
What disrespect to this house for the government to come along today, to recall parliament after nine months in which they failed to land a deal and ask us for a blank cheque. This is no way to run a corner shop, let alone the country.”
In his concluding remarks, Griffith said:
It’s a government by sulky teenager – not sharing their plans, not answering the question and when it goes wrong it’s everyone’s fault but theirs.”
Shadow business secretary Andrew Griffith accused the government of pursuing a “botched nationalisation plan” and said the opposition would seek to amend the bill to put an expiry date on the powers given to ministers.
He told the Commons:
This is a failure on the government’s watch, let’s be crystal clear what today means: we are entering a tunnel with only one exit. This is a botched nationalisation plan revealing the government has no plan.
In government we acted to secure Port Talbot and were negotiating a plan, including British Steel’s preferred option of an electric arc furnace in Teesside. That would have limited job losses and kept Scunthorpe running in transition.”
Griffith claimed Scunthorpe is the “victim of a dishonesty that pretends it is better for the environment to ship coke halfway around the planet than from down the road”, adding:
And an energy policy that has driven costs higher than any competing nation.
No one is more responsible for this than the energy secretary [Ed Miliband] and the prime minister who appointed him.”
Pressed by Liberal Democrat MP Wera Hobhouse for details of the deal negotiated by the Tories, Griffith replied:
I think [Conservative party leader Kemi Badenoch] has been extremely clear that the deal was being negotiated and the point about a deal being negotiated is that deal would be concluded after the election.”
Most of the UK’s foundation industries were in “substantial difficulty” when Labour entered office, Jonathan Reynolds said.
Reynolds told MPs crude steel production had halved since 2010 and said the two remaining blast furnaces at Scunthorpe dated from the 1930s and 1950s. He added that the steel industry is a smaller proportion of the UK’s overall economy than in other comparable major nations.
He said:
We’ve got to be looking to the future as well, to new technology, to new investments and that is crucially why having the dedicated resources this government has put in to steel is why we’ve got the chance to look with optimism to the future.”
Finishing his opening speech, he said:
Whether it is at Port Talbot, whether it is via our upcoming steel strategy, whether it’s via our work to improve public procurement, or in the introduction of our industrial strategy to tackle the most thorny issues of industrial competitiveness, where others have shied away this government has stepped up.
Steel is fundamental to Britain’s industrial strength, to our security, and to our identify as a primary global power. Today’s legislation will help ensure that we can retain that steelmaking capability here in the UK, both now and for years to come.
For British workers’ security, for British industry’s future, and without hesitation in our national interest, and for the workers of British Steel and for their families, this action today is essential.”
Lib Dems criticise UK government for not intervening to protect Port Talbot
The Liberal Democrats have criticised the UK government for not intervening to protect the Port Talbot steelworks, reports the PA news agency.
David Chadwick, the Welsh Liberal Democrat Westminster spokesperson, said:
Where was this scale of action when thousands of job losses were announced at Port Talbot just a few months ago?
While action to save jobs in Scunthorpe is welcome, why has this Labour government decided communities in England are worth fighting for and those in Wales are not?
Workers right across south Wales will be asking themselves how this unjust situation was ever allowed to occur.”
Welsh Lib Dem leader Jane Dodds MS added:
It is outrageous that Labour was willing to see over 2,000 jobs in Port Talbot and the wider supply chain go forever, but the UK Government acted to save them elsewhere in the country.
The Welsh Liberal Democrats constantly called for action to protect jobs at Port Talbot over very many years.
While it was the Conservatives that plunged the south Wales proud steel industry into crisis through years of neglect, it will be Labour’s decision to act to protect English steel but not Welsh steel that will be remembered by communities for decades to come.”
Jonathan Reynolds said Conservative leader, Kemi Badenoch, was wrong to say she had negotiated a modernisation plan with British Steel for electric arc furnaces at Teesside and Scunthorpe.
Badenoch posted on X on Friday saying as business secretary in the last Conservative government she had negotiated the proposal but it was “bungled” by Labour.
The business secretary said:
I wish to make unequivocally clear to the house, the government inherited no such deal. We could not renege on that deal because it did not exist. On day one, I was told that there had been a lack of progress on this matter to date.”
Reynolds asked how much Badenoch had agreed to give Jingye, and what the conditions were. He said the proposals she mentioned were more expensive.
Intervening to respond, Badenoch said:
Labour cannot negotiate. We were negotiating a modernisation deal that would have had limited job losses, just like we had in Port Talbot. They inherited a functioning commercial deal in Port Talbot, the same was going to happen with British Steel had we not had a snap election. What he is doing now is the union-pushed deal.
They brought that deal to me, I said no, he said yes.”
Continuing the exchange with Badenoch, Reynolds replied:
This is genuinely revelatory.
I say again, if Jingye was for £1.2bn to build at lesser cost in one place, what was the sum of money agreed by the leader of the opposition when she was business secretary to build in two places?
It certainly wasn’t in the accounts of the chancellor.”
Badenoch intervened again:
We had not finished the negotiation so there was no amount, but it would have succeeded better than the terrible plan he’s got now.”
Conservative party could now view selling British Steel to Jingye ‘as a mistake’, says Reynolds
The government does not believe steel production is a declining industry in the UK, Jonathan Reynolds said.
The business secretary gave examples of the 400,000 tonnes of new steel needed for Heathrow airport’s expansion, and the planned Universal Studios theme park in Bedford that will use UK-made steel where possible.
Reynolds said:
When it comes to steel, we will never accept the argument that steel making is a sunset industry. Steel is vital to every bit of the modern economy, domestic demand for steel is only set to go up, not down.”
He said the Conservative party could regret selling British Steel to Jingye.
“The legislation we’re setting out today will also help end the uncertainty that has been hanging over British Steel’s Scunthorpe site for too long,” he said.
He added:
This issue should have been resolved years ago. I also believe that they now view it as a mistake to have given this essential national asset to this company.”
Plaid Cymru will seek to amend the steel industry (special measures) bill to extend the business secretary’s powers into Wales, where blast furnaces have closed down in Port Talbot.
Plaid’s Westminster leader, Liz Saville Roberts, told the Commons:
When the blast furnaces in Port Talbot closed down in September last year, his government could have taken exactly the same legislative action as they are choosing to do today.
We will be endeavouring to amend this bill to include England and Wales, because there is still the opportunity for his government to make a real difference to the community of Port Talbot and the 2,800 jobs they lost there.”
The business secretary, Jonathan Reynolds, replied:
The blast furnaces have already closed at Port Talbot. They are not available to be saved. That situation has moved on.”
The situation at Grangemouth oil refinery in Scotland “is not a comparable situation” to the one at British Steel in Scunthorpe, business secretary, Jonathan Reynolds, has told MPs.
Reynolds told the Commons:
I understand that some have asked about precedent or referenced other troubled industrial situations.
And to be clear again, this is an exceptional situation, a unique situation, and the question for all members is whether we as a country want to continue to possess a steel industry, do we want to make the construction steel and rail we need here in the UK, or do we want to be dependent on overseas imports?”
SNP Westminster leader, Stephen Flynn, told MPs:
Many minds right now will be very much focused on the situation in Grangemouth, where we know that hundreds of jobs are going to be lost directly, thousands of jobs in the supply chain.
Now, were I, or perhaps even the local member for Alloa and Grangemouth [Labour MP Brian Leishman], to bring forward a similar bill in respect of Scotland’s only oil refinery, to save it, to give him [Reynolds] the executive power to do as he pleases, as he is doing with British Steel, would the Labour party back it in the same way as it is backing this bill today?”
Reynolds replied that “this Labour government has pledged £200m to secure its long-term future”.
He added that “it is not a comparable situation and the behaviour of the company is not comparable to the situation in this case”.
Former Conservative party leader Iain Duncan Smith has asked business secretary, Jonathan Reynolds, about “a reasonable limit” on government interventions at steelworks under the steel industry (special measures) bill.
The Tory MP told the Commons:
I don’t see a sunset clause in here.”
He said such a measure could bring “the government back here to debate whether they should extend that process and puts therefore a reasonable limit on government activity without debate”.
Reynolds said in his reply:
I make clear I don’t want these powers a minute more than is necessary.
I cannot say at the minute when we drafted this bill the time frame that they were required for, but I will endeavour and commit at the despatch box to keep the house updated.”
He later added:
Just to be absolutely specific, where we make an order in relation to control of a steel undertaking, once that control has been established and is no longer required, we can revoke those regulations as well.”
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