Will steel be brought back under state ownership?

Is the British steel industry about to be nationalised again? The chancellor, Rachel Reeves, who’d have to find the money to make such a deal, has pointedly said that all options are on the table”, not ruling out state control as a possible solution.

- SEAN O'GRADY

However, this Labour government has shown a marked reluctance to extend public ownership even to sectors where there are natural monopolies and such a step would be wildly popular – such as water and rail. According to Lisa Nandy, the latest cabinet minister to comment on the steel crisis, a “commercial solution” for British Steel is “within reach”. It will be a test of the government in more ways than one…

What’s the background?

The Scunthorpe steelworks are now owned by the Chinese group Jingye, and trading as British Steel. They contain the last remaining blast furnaces in the UK, and thus the only means by which the country can make “virgin steel” as opposed to the recycled product made at Port Talbot (owned by Tata, an Indian conglomerate). The Port Talbot works are supported by a government subsidy, which paid for an electric arc furnace, obviating the need to use coming coal – but the steel thus produced isn’t suitable for every purpose. The 25 per cent Trump tariff imposed on steel exports to the US adds to the challenges facing the UK industry. Some 2,700 jobs are at stake in Scunthorpe, and many more indirectly.