British Steel has scrapped plans to cut up to 2,700 jobs at its Scunthorpe plant after the UK government intervened to stabilise the business and prevent the collapse of the country’s primary steelmaking capability.
The mass redundancy consultation, launched last month by the company’s previous management, was triggered after Chinese owner Jingye Group rejected a £500 million government support package aimed at transitioning to greener production. But following the rejection and growing fears over the future of domestic steelmaking, ministers moved quickly to take control of the business and appoint a new executive team.
In a statement on Tuesday, Lisa Coulson, interim chief commercial officer, confirmed the consultation would now be closed.
“It has been a difficult and worrying time for staff and their families,” she said.
“But I can confirm we are closing the redundancy consultation without action.”
The announcement follows the passage of the Steel Industry Special Measures Act, which grants emergency powers to protect UK steel production. Shutting the blast furnaces would have left the UK as the only G7 country unable to produce steel from raw materials – a national security concern as well as an industrial one.
Business Secretary Jonathan Reynolds has admitted that nationalisation remains a “likely option” but said the government is also actively seeking buyers, including interest from US investors. He confirmed that the UK has now secured a stable supply of raw materials to keep operations going.
Unions welcomed the news. Charlotte Brumpton-Childs of the GMB union called it “fantastic news for steel workers and the people of Scunthorpe,” crediting the government’s swift action for saving jobs and the industry’s future.
Industry minister Sarah Jones is expected to tell the House of Commons today that the reversal was only possible because of “decisive intervention at a critical moment.”
