British Steel’s Chinese owners push for Government bailout
The owners of British Steel are seeking an urgent package of financial support from taxpayers, raising concerns over the future of thousands of industrial jobs in northern England.
Jingye Group (Jingye) warned ministers the company’s two blast furnaces are unlikely to be viable without state aid, according to Sky News.
The Chinese group bought the second-largest steel producer out of insolvency in 2020.
British Steel is headquartered in Scunthorpe, north Lincolnshire and employs around 4,000 people, with thousands more dependent on the company across the supply chain.
The request from Jingye is a serious challenge for Jacob Rees-Mogg, the new business secretary, ahead of the Conservative Party’s annual conference in Birmingham.
While the precise scale of the support being sought by the Chinese industrial group remains unclear this weekend, sources told Sky News it would need “hundreds of millions of pounds” to keep the Scunthorpe blast furnaces operational.
It was also unclear whether any financial subsidy would be in the form of a loan or grant.
One insider revealed Jingye was prepared to make thousands of people redundant if ministers rejected its request.
It would subsequently plan to import steel from China to roll at British Steel’s domestic sites.
This weekend, the Government confirmed it was working “at pace” with the company to establish solutions which ensure the company’s long term future.
“We recognise that businesses are feeling the impact of high global energy prices, particularly steel producers, which is why we have announced the Energy Bill Relief Scheme to bring down costs,” a spokesman for the Department for Business, Energy and Industrial Strategy told Sky News.