SCUNTHORPE — The UK government introduced the Steel Industry (Nationalization) Bill in Parliament on May 14, giving ministers the power to nationalize steel companies such as British Steel if a public-interest test is met. The bill was scheduled for its first reading the same day and would provide a route to bring steel companies into public ownership where necessary.

"Revitalizing our steel sector is a top priority for this country and this is an important first step to safeguard our steelmaking capability, which would allow us to secure the future of British Steel and explore possible options to modernize the industry," Industry Minister Chris McDonald said. He said the bill's early progress through Parliament showed the government was serious about securing Britain's domestic steel production.

The bill followed emergency legislation passed by Parliament on April 12, which allowed the government to take control of British Steel's blast furnaces, prevent their closure, and secure the raw materials needed to keep them operating. Prime Minister Keir Starmer said the move was aimed at saving British Steel and protecting more than 2,700 jobs in Scunthorpe.

British Steel had been acquired by Jingye Group, a privately owned steelmaker based in Hebei province, for £70 million in 2020. Jingye said it had invested £1.2 billion in British Steel. The company said the Scunthorpe steelworks were losing £700,000 a day and were no longer financially sustainable, and it rejected a £500 million state rescue package. British Steel had annual losses estimated at £250 million due largely to high electricity costs in the UK and an influx of cheap Chinese steel. The company reported a post-tax loss of £367 million in 2022 and £227 million in 2023 and said losses continued into 2024.

A spokesperson for China's Ministry of Commerce responded to the UK government's actions. "The British government should uphold fairness, impartiality and non-discrimination, act cautiously in its decisions, and safeguard the legitimate rights and interests of Chinese enterprises," the spokesperson said. The spokesperson said the British government had been in control of British Steel for more than a year since taking it over from Jingye and that any action by Britain should fully consider the substantial investment made by the Chinese company in the British steel industry and its contribution to the British economy and society. The spokesperson called on Britain to respect Jingye's wishes and market principles and said China would take firm measures to protect the legitimate rights and interests of Chinese enterprises.

British Steel was created by nationalization in 1967 when the UK government brought the country's main steel companies into public ownership. After privatization in 1988, the company changed hands several times before collapsing into insolvency in 2019 and being rescued by Jingye in 2020.