British Steel: Business Secretary refuses to guarantee Scunthorpe blast furnaces will stay online

If the blast furnaces run out of raw materials, they can never be turned back on.

Preventing that from happening was the primary reason for the Government recalling Parliament on Saturday to pass emergency legislation to keep the site open.

Mr Reynolds now has powers to direct the company to purchase coal to keep the blast furnaces active, however he refused to confirm whether this would arrive in time.

While this is not full nationalisation of British Steel, he admitted this was the likely outcome unless the Government can find a private sector partner to work with on the transition to the more sustainable electric arc furnaces.

The Business Secretary told the BBC’s Sunday With Laura Kuenssberg: “If we hadn’t acted, the blast furnaces were gone, steel production in the UK, primary steel producing, would have gone.

“So we’ve given ourselves the opportunity, we are in control of the site, my officials are on site right now to give us a chance to do that.”

It comes as the GMB Union confirmed that British Steel workers prevented executives from the Chinese owner, Jingye, from going onto the plant on Saturday as they were concerned about “sabotage”.

Gary Smith, the general secretary of the union, which represents some of the staff, told the BBC: “We actually spoke to Government a couple of weeks ago because we were concerned that the Chinese owners were not going to bring the coke in to keep the plant going.

“We were worried about industrial vandalism and there was a worry about sabotage and yesterday workers prevented executives from the Chinese owners from going on site.”

Humberside Police confirmed that they were called to the scene over a suspected breach of the peace.

A spokesperson said: “Upon attending, conducting checks and speaking to individuals in the area, there were no concerns raised and no arrests were made.”

Mr Reynolds also said the Government had decided to take emergency action when it learned that British Steel’s Chinese owners had not only stopped ordering more raw materials, but begun selling off the supplies it already had.

Jingye also rejected an offer of support in the region of £500 million, instead demanding more than twice that figure with few guarantees the blast furnaces would stay open.

In the Commons on Saturday, he said Jingye had not been negotiating “in good faith”, while on Sunday he suggested it had not been acting “rationally”.

He suggested the company’s ultimate plan had been to close the blast furnaces, but keep hold of the more profitable steel mills and supply them by importing steel from China.

But Mr Reynolds declined to accuse the company of deliberately sabotaging the business at the behest of the Chinese Communist Party (CCP).

Jingye has links to the CCP, as do all major Chinese companies, but Mr Reynolds said he was “not accusing the Chinese state of being directly behind this”.

He told Sky News’s Sunday Morning With Trevor Phillips: “I actually think they will understand why we could not accept the proposition that was put to us, in terms of losing that essential national capacity.

“I’m not alleging some sort of foreign influence.”

But he did agree there is now a “high trust bar” to bringing Chinese investment into the UK, and said he would not have allowed a Chinese company to invest in the “sensitive” steel sector.

Reform UK leader Nigel Farage, however, told the BBC he is “100% certain” the CCP had ordered Jingye to buy British Steel in order to close the business, but provided no evidence, saying it is only “intuition”.

Jingye agreed to buy British Steel in 2019 when Boris Johnson was prime minister.

Andrew Griffith, the shadow business secretary who at the time had been Mr Johnson’s chief business adviser, said on Sunday Jingye had been “the only bidder”.

Having taken control of British Steel, ministers remain hopeful they can find a private company to invest in the business given the cost of modernising the Scunthorpe plant could run into the billions.

But there are currently no private investors willing to take the company on, and Mr Reynolds has acknowledged nationalisation was “the likely option”.

In the meantime, he told Sky News the Government expects to lose money running British Steel, with the last set of accounts showing annual losses of £233m.

Mr Reynolds said he believed that figure “can be improved upon”, and said the public should compare the cost to “the option of spending a lot more money to reach a deal that would have seen a lot of job losses and Jingye remain as a partner”.

He added: “Or the cost of the complete collapse of British Steel, easily over £1bn in terms of the need to respond from Government, to remediate the land, to look after the workforce.”

The Government expects the cost of running British Steel to be met from a £2.5bn steel fund it announced at last year’s budget, meaning it will not have to borrow more money.