British Steel

Chris McDonald Excerpts

Tuesday 14th October 2025 Written Statements

[The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)]

The Government committed to updating Parliament on British Steel every four sitting weeks for the duration of the period of special measures being applied under the Steel Industry (Special Measures) Act 2025.

The Government’s priority remains to maintain the safe operation of the blast furnaces at British Steel. To that end, Government officials are continuing to provide on-site support to continue steel production, ensure that health and safety issues are being remedied, stabilise operations and improve the steady state of the business.

Work continues to develop an impact assessment, which will be published in due course following Regulatory Policy Committee scrutiny. We are also continuing work on regulations under section 7 of the Act, to introduce a compensation scheme for steel undertakings that have received a notice under the Act.

On funding, the position remains that all Government funding for British Steel will be drawn from existing budgets, within the spending envelope set out at spring statement 2025. To date, we have provided approximately £235 million for working capital, covering items such as raw materials, salaries, and addressing unpaid bills, including for SMEs in the supply chain. This will be reflected in the Department for Business and Trade’s accounts for 2025-26.

As we have stated previously, our long-term aspiration for British Steel will require co-investment with the private sector to enable modernisation and decarbonisation, support jobs, safeguard taxpayers’ money and retain steelmaking in Scunthorpe. However, this will not be without challenges. Jingye acquired a troubled business in 2020 and it has faced challenging market conditions and circumstances in the years since. The company has not been able to overcome these difficulties and achieve profitability at British Steel. But this Government remain committed to restoring the long-term viability of steelmaking at Scunthorpe, and the UK steel sector as a whole, and we continue to see tangible benefits resulting from the wide-ranging actions we have taken, such as tackling high electricity prices via the uplift to the British industry supercharger and changing Government procurement rules.

International trade

Last month, the United States confirmed that the UK will not face an increase in metals tariffs to 50% and will remain the only country in the world to benefit from a preferential 25% rate on steel, aluminium and derivative exports to the US. This provides the certainty that UK industry has long been calling for. The UK is uniquely positioned as the only country to have secured this commitment, giving our companies a 25% competitive advantage over global competitors. It further strengthens the UK’s reputation as a trusted supplier of high-quality steel and aluminium. We continue to work closely with our US counterparts to reduce tariffs further and secure the best possible outcomes for UK manufacturers.

On 10 October, the Parliamentary Under-Secretary of State, Minister for Digital Economy (Liz Lloyd CBE), joined Ministers from partner countries at the Global Forum on Steel Excess Capacity ministerial in Gqeberha, South Africa. At the meeting, Ministers agreed to develop a comprehensive framework for joint action to address global steel excess capacity by June 2026.

On 7 October, the EU announced a new steel trade measure, which will replace its existing steel safeguard, which includes significantly reduced quota sizes and a higher out of tariff rate replacing its current safeguard. This decision is not targeted at the UK but will be highly concerning for many of our steel producers and their workers.

We will always defend our critical steel industry and have already engaged the EU at ministerial and official level to understand the details of this proposal. It is vital that we protect trade flows between the UK and EU, and we hope there is a way to work with our closest allies to address global challenges rather than adding to our industries’ woes. We reserve the right to take any action in response to any changes to our trading relationships.

In addition, we will ensure we have robust protections in place for our sector. We amended the steel safeguard to make it more effective in June and we continue to explore stronger trade measures to protect UK steel producers.

Steel procurement

We have now published the steel pipeline of UK public infrastructure projects taking place over the next few years and have announced targeted action to provide relief on electricity network charges via the British industry supercharger. We remain committed to publishing the steel strategy, which will articulate what is needed to create a competitive business environment in the UK with the aim of attracting new private investment to secure and expand UK steelmaking capability.

Liberty Steel

As Members will be aware, Liberty Speciality Steel UK entered compulsory liquidation on 21 August. On 2 September, my predecessor, my hon. Friend the Member for Croydon West (Sarah Jones), delivered an oral statement to the House, providing reassurance that there would be no immediate changes to the company’s operations or the status of employees’ jobs.

I recognise that this continues to be an unsettling time for the SSUK staff, their families and the local community. Responsibility for the day-to-day management of the process, including ensuring employees continue to be paid, now lies with the independent official receiver and the appointed special managers. Following the official receiver’s recommendation, the Government have agreed to initiate a sales process. This offers the potential to safeguard jobs and preserve steelmaking capability. To facilitate this, the Government have provided funding to the official receiver to enable him to carry out his duties effectively.

The Government are committed to securing a positive outcome for the SSUK sites, one that delivers a sustainable, commercially viable future for steel production. More broadly, we remain committed to supporting a sustainable and prosperous future for the whole of the UK steel industry. We are taking decisive steps to revitalise the sector after years of neglect, working to secure good jobs in Scunthorpe and other proud steelmaking communities for the long term.

[HCWS957]