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The Business Secretary has accused Chinese British Steel owners of trying to “unilaterally” closing his scunthorpe oven, while MPs began emergency legislation to save the plant.
Jonathan Reynolds told MPs that developments were needed in the past days’ extraordinary session of parliament, as Jingye rejected the government’s offer of support and took steps to end steel production at Scundrants.
He said, ‘To do nothing is not an option.
‘We could not, will and will never stand idle, while heat of the remaining explosion oven of the UK will sink into without any planning, any proper process or any respect for the consequences.
“And that’s why I needed colleagues here today.”
MPs gathered in Westminster on Saturday after being unexpectedly recalled from the recess – the first Saturday memorial since the Falkland War in 1982 – to debate emergency legislation intended to save the Scunthorpe plant.
The steel industry (special measures) Bill gives the government the power to teach steel companies in England to keep facilities open, with criminal fines for managers if they do not comply.
Ministers said these measures are needed to keep the Scunthorpe ovens open and protect both the UK’s primary steel manufacturing capacity and the 3,500 jobs.
But Conservatives said that the government should have acted earlier, with the shadow leader of the house Alex burghart accusing ministers of making “a total pig breakfast of this entire arrangement” because they sought “far-reaching forces that had not been seen in legislation for the past forty years”.
Reynolds, who opened his speech with the bill, said the government had a ‘substantial’ offer of support to Jingye, which British Steel bought in 2020, but the offer was rejected.
The offer would have seen the government buy the raw materials needed to keep making steel “which would not ensure any losses for jingye” to maintain the ovens.
But the offer was rejected, with Jingye making a counter -offering offering the government that the company paid “hundreds of millions of pounds”, without stopping conditions to the money transferred to China and no agreement to keep the ovens “maintained and in good working order”.
Mr. Reynolds said: “Despite our offer that Jingye was significant, they wanted a lot more. Honestly, an excessive amount. However, we still committed to negotiating.
“But over the past few days it became clear that the intention of Jingye was to refuse to acquire adequate raw materials to run the ovens, their intention was to cancel and refuse to pay for existing orders.
“The company would therefore have closed irrevocably and unilaterally on primary steel manufacturing at British Steel.”
Mr. Reynolds said the emergency legislation is a ‘proportional and essential step’, adding that he wanted it to be a ‘temporary position’ with the powers that did not take a minute longer than necessary ‘.
Saturday’s emergency legislation does not stop the full nationalization of British steel, and ministers are still hopeful that they can obtain private investments to save the plant.
But with the BBC, Industry Minister Sarah Jones admitted that there were currently no companies that were willing to make an offer, while Mr. Reynolds in the Commons acknowledged that public ownership was ‘the likely option’.
Ms Jones also insisted that there would be “no extra costs for the treasury” due to the government’s actions, with the costs announced to a £ 2.5bn steel fund announced at last year’s budget.
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