Keir Starmer warns the future of British Steel 'hangs in the balance'

Keir Starmer warned that the future of British Steel 'hangs in the balance' today as he prepares to recall Parliament tomorrow to pass emergency measures to stop the furnaces being switched off.

MPs and peers are being brought back to Westminster from the Easter recess as ministers mull full-blown nationalisation in the wake of Donald Trump's tariffs.

All steel and aluminium imports to the US have been hit with a 25 per cent levy, in another blow to the already struggling UK industry.  

The Chinese owner of the Scunthorpe-based business plans to close the blast furnaces and switch to a greener form of production, despite government objections.

The return of Parliament is needed to sign off legislation ensuring the 'continued operation' of the furnaces, which are making a loss of around £700,000 a day.

It is understood that ministers are still looking for a private buyer for the business but that the legislation tomorrow will allow the government to take control of operations. 

Speaking in Downing Street today, Sir Keir said all options, including nationalisation, remain on the table.

'This afternoon, the future of British Steel hangs in the balance,' he said.

'Jobs, investment, growth, our economic and national security are all on the line.'

Kemi Badenoch has said Labour 'bungled' negotiations over British Steel and are now 'scrambling for a solution' that will come at a big cost to taxpayers. 

'They've made poor decisions and let the unions dictate their actions, she said.

'Keir Starmer should have seen this coming. But instead of addressing it earlier in the week when Parliament was sitting, their incompetence has led to a last-minute recall of Parliament.'

The Steel Industry (Special Measures) Bill will be pushed through all stages during the day. Speaker Lindsay Hoyle and his counterpart in the Lords have approved a rare Saturday sitting. 

It will be the first one since October 2019, when MPs considered Boris Johnson's Brexit deal. 

However, technically there has not been a recall for a Saturday sitting since the Falklands War in 1982. 

The emergency legislation will give the Government the power to direct the company's board and workforce.

This aims to ensure they get paid, and are able to order the raw materials to keep the blast furnaces running, according to the Department for Business and Trade.

The Government has instructed the company's UK management to continue the plant's operation, including its furnaces.

This legislation will mean that any employees who are sacked by the plant's Chinese owners for taking steps to keep it running can be reinstated.

UK Steel director-general Gareth Stace said: 'Recalling Parliament is the right decision to ensure that British Steel, the wider steel sector and thousands of steel workers and their families are given the certainty they deserve in trying times.

'It is welcome news that Government recognises the seriousness of the UK's steel industry circumstances and the essential contribution our sector makes to the national economy and security, as well as the communities that rely on it.

'We look forward to further detail from Government on its commitment towards a secure and stable steel sector.'

Ministers have been footing the bill to buy specialist coal from Japan needed for the process in the short-term. 

Officials approved funding for the 55,000-ton coal consignment after being warned that supplies were on the verge of running out, with the facility unlikely to reopen if its two furnaces shut.

British Steel was bought by Jingye Group, a Chinese company in March 2020.

Business and Trade Secretary Jonathan Reynolds and officials met with the chief executives of Jingye and British Steel earlier this week for discussions on steelmaking in Scunthorpe.

Hopes have been fading that the UK can secure a deal to wipe out the US tariffs.

Asked this morning if she was losing confidence in the prospect, Chancellor Rachel Reeves stressed negotiations were ongoing.

But she suggested little progress was being made, and the focus was turning to other trade partners. 

'We continue to engage with our counterparts in the United States, and of course we want to secure the best deal possible for British jobs and British industry. And we are absolutely … resolved to do everything we can,' she said.

'But, at the same time, we also want to improve trading relations with other countries around the world.

'It's why I hosted the Indian finance minister in London this week as part of our economic and financial dialogue, and to try and secure a free trade and investment treaty with India.

'It's also why we are having a summit with the European Union in May to improve our trading relations.

'I'll be travelling to Poland later today to meet with my finance minister counterparts from across Europe.'