Scunthorpe blast furnaces - Photo: Wikipedia

On Saturday, April 12, the government recalled the MPs and the Lords to Parliament, including arranging King Charles III for the Royal Assent, to pass in one day an Act of Parliament, the Steel Industry (Special Measures) Act 2025 [1] to put on hold the immediate closure of the blast furnaces at British Steel Scunthorpe owned by the Jingye Group, a Chinese steel-maker. The closure of the steel plant is directly threatening three to four thousand jobs and would devastate employment in Scunthorpe as well as end the production of virgin steel in Britain, forcing manufactures to import all virgin steel from abroad, or rely on recycled scrap steel.

Announcing the Bill, Prime Minister Keir Starmer claimed that in passing the Act "today, my Government has stepped in to save British Steel". However, the Act only states that it is "An Act to make provision about powers to secure the continued and safe use of assets of a steel undertaking." Yet he continued to claim that "we are acting to protect the jobs of thousands of workers, and all options are on the table to secure the future of the industry". He also claimed that his government is "turning the page on a decade of decline, where our manufacturing heartlands were hollowed out by the previous government".

In the debate on the Bill, the Secretary of State for Trade and Industry, John Reynolds, whilst he claimed the government was "unashamedly on the side of working people" and he admitted that "steel is vital to every bit of a modern economy", he also revealed where this last minute and desperate concern of the government about the closure of the last blast furnaces in Britain has come from. He said, "Let me conclude by saying that steel is fundamental to Britain's industrial strength, our security and our identity as a primary global power." In other words, as the government continues to escalate support for Britain's militarised economy, the export of weapons to Israel and other countries in its genocidal war against the Palestinians and one of the prime movers in NATO's proxy war in Ukraine the loss of steel making as a whole is seen as "fundamental" blow to the government's warmongering plans. It should be remembered that peace and security are indivisible, and that militarisation only leads to insecurity and war.

Scunthorpe steel workers fighting to their jobs and all steel workers in 1980

Following the passing of the Act, British officials were said to have stepped into what was described by the Independent [2] as a "desperate race to save its blast furnaces after what ministers believe was a plot to sabotage the Scunthorpe plant by its Chinese owners". Also the paper reported that "on Sunday, business secretary Jonathan Reynolds said Chinese firms should be barred from investing in some sectors, including those vital to national security and key infrastructure". These and many other comments, as well as outrageously attempting to paint China as a threat to British security and sovereignty, were designed to place the pending complete demise on the production of virgin steel in Britain on the backs of this Chinese company ignoring the whole history of British Steel Scunthorpe and the role played by the Westminster cartel party system over decades of the run down and closure of the whole steel industry in Britain. It is a process that began with Margaret Thatch er bringing in the Scottish-American industrialist Ian MacGregor in the 1980s to oversee the privatisation of British Steel.

In 2016, the long products division (e.g. railway lines and construction steel) including the Scunthorpe steel works was sold by Tata to the asset stripping company Greybull Capital for a nominal sum of £1 but took on liabilities accumulated by Tata. This was when the business was renamed British Steel Ltd. Scunthorpe had been part of the twice nationalised steel industry in Britain following World War II which was finally privatised in 1988 under the Conservative government led by Prime Minister Margaret Thatcher.

Steel workers strike 1980

In May 2019, British Steel Scunthorpe was placed by Greybull Capital into compulsory liquidation. Control of the company passed to the official receiver while a buyer was found. After huge protests from the workers and people of Scunthorpe, the sale of British Steel to Jingye Group was overseen by the UK Conservative government led by Prime Minister Boris Johnson, with Business Secretary Andrea Leadsom handling the negotiations. According to reports, the government saw this as a strategic move amid UK-China relations pre-pandemic and in March 2020, Jingye Group became the owner of British Steel costing £50 million plus pledges of £1.2bn in investment. Following the purchase, the Jingye Group invested £330 million in capital projects during its first three years of ownership. However, the closure of the coke plant was announced in February 2023 with the loss of 260 jobs.

In November 2024, the company opened a new £10 million "rail hub" which has the capacity to hold 25,000 tonnes of rail in 354ft (108m) lengths. However, during 2024 Jingye also implemented significant cutbacks, including blast furnace shutdowns and job losses. According to reports, Jingye cited that the company was losing £30-50 million per month due to high energy costs (UK industrial electricity prices are among Europe's highest), cheap steel imports from China, India, and Türkiye, and weak demand in construction and rail sectors which the plant specialised in.

Save Our Steel Campaign Port Talbot

Also in 2024, the Jingye Group stalled the full promised investment in negotiations with government over funding for the government's net-zero targets, requiring steel makers to invest to slash carbon emissions. Reports say that Jingye demanded the same subsidies as Tata of £500 million (reports say the government offered Jingye £300 million), with their plans to make a transition to Electric Arc Furnaces (EAFs) at British Steel Scunthorpe just as Tata had done at Port Talbot. This was to replace Scunthorpe's traditional blast furnaces (BFs) and basic oxygen steel making (BOS) with EAFs as part of its decarbonisation strategy requiring less energy and a much smaller work force. However, production of virgin steel would be ended at all plants in the UK and the EAFs rely on the availability of high quality scrap steel which reports say is not always available, especially for rails and construction.

On February 4, the steel unions the GMB, Community and Unite, warned that the government must meet the "additional carbon costs" involved in order to proceed with their bid to save thousands of jobs [3]. GMB national officer Charlotte Brumpton-Childs said that "the major barrier" is the additional carbon costs to be paid under government policy regulations. "For our plan to be viable - we need ministers to provide relief from these policy costs, just as other European countries have done," she added. A Department for Business and Trade spokesperson said: "This government will simply not allow the end of steel
Militant demonstration of Redcar steelworkers, July 18 2009 - Photo: RachelSNmaking in the UK. That's why we've committed up to £2.5 billion of investment to rebuild the UK steel industry and support communities now and for generations to come. We're working across government in partnership with trade unions and businesses, including British Steel, to secure a green steel transition that's right for the workforce, represents a good investment for taxpayers and safeguards the future of the steel industry in Britain."

Responding to the government's Steel Industry (Special Measures) Act 2025, Sharon Graham, General Secretary of Unite, commented: "I am pleased that the government has listened to representations by Unite and other steel unions over the future of British Steel. Ministers could not have allowed a foundation industry to go under with the loss of more than 3,000 jobs and key skills. It is absolutely the right thing to do to begin the process of nationalisation."

However, only last September, Tata also ended its virgin steel production at its Port Talbot plant in Wales [4]. At that time Labour's Chancellor, Rachel Reeves, spoke about "the importance of addressing the foundations of the economy, including steel production". Again these words rang hollow in the face of this unilateral closure by Tata. Time and a time again over recent years with the closure of steel production in Consett, in Corby, in Redcar, the jobs of the steel workers and their communities have been at the mercy of the powerful competing private interests of the oligopolies that cannot offer solutions and instead destroy vital productive forces and skills in the name of receiving the most subsidies and making the most profit. Whilst time and again the alternative plans of the workers and their unions are rejected by the cartel parties it is up to the working class to keep these oligarchic governments in check and fight for their interests that represent the interests of society and its future. A new direction for the economy is needed.

Notes
1. Steel Industry (Special Measures) Act 2025
https://www.legislation.gov.uk/ukpga/2025/13/contents/enacted
2. Race to save British Steel factory after Chinese firm's 'sabotage', Independent, Monday April 14 2025
https://www.independent.co.uk/news/uk/home-news/british-steel-scunthorpe-jingye-group-b2732572.html
3. British Steel 'warm' on blast furnace plan
https://www.gmb.org.uk/news/british-steel-warm-on-blast-furnace-plan
4. Further Destruction of Manufacturing over Which Workers' Decisive Say Is Being Denied, Workers' Weekly, October 12 2024
https://www.rcpbml.org.uk/wwie-24/ww24-25/ww24-25-06.htm

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