The future of Liberty Steel has been thrown into turmoil after Greensill Capital, a group that lends money to businesses so they can pay their suppliers, filed for administration last week.
Greensill was the main lender to Sanjeev Gupta’s GFG Alliance which includes Liberty Steel – the owner of steel plants across the UK, including in Rotherham and Scunthorpe.
And in the Commons today Shadow Business Secretary and Doncaster North MP Ed Miliband said an answer given to Rotherham MP Sarah Champion over the 900 Liberty Steel workers in Rotherham “simply wasn’t good enough”.
He said: “No ideology or dogma must stand in the way of protecting the jobs of 5,000 people and many more in the supply chain. This is a critical part of our national infrastructure and it’s critical to those communities.”
He added that the Business Secretary Kwasi Kwarteng must “now do what he has failed to do so far, and say that he will do whatever it takes, including public ownership if it is the best value for money choice, to save those jobs, if it is necessary.”
But Mr Kwarteng said it was an “ongoing commercial matter”.
He said: “I’ve seen local management, I’ve seen representatives of the unions, and I’ve seen a number of people who are very keenly involved in the steel sector, and it would not be appropriate for me to enter into what is a commercially sensitive situation.”
And he added his “heart goes out” to the workers, who he deemed “excellent”.
However Mr Miliband said: “This is not about his meetings or about his heart, it’s about his action, and his willingness to say that he will do plan B if it is necessary to save those jobs.”
Labour has previously called for an inquiry into reports David Cameron lobbied Rishi Sunak to grant millions of pounds in loans to Greensill Capital before its collapse.
The Sunday Times said the former prime minister, who was advising Greensill, sent a number of texts to the Chancellor’s private phone asking for support through the Government’s Covid Corporate Financing Facility (CCFF).
The paper said that most of the messages went unanswered and that the company eventually went bust after its loan application was rejected.
It said that Mr Sunak was understood to have stood by officials who felt the company did not qualify for the scheme.
He was said to have referred Mr Cameron to senior officials at the Treasury.
Those contacted by the former premier were said to include Tom Scholar, the permanent secretary, and Charles Roxburgh, the second permanent secretary.
The Treasury later made a final decision to reject the company’s application.
For Labour, shadow chancellor Anneliese Dodds said: “Rishi Sunak already had questions to answer as to why Greensill was given so much more access to the Treasury than other Covid lenders.
“The suggestion that David Cameron was also contacting the Chancellor directly to further Greensill’s commercial interests raises even bigger concerns.
“This is public money, and the processes involved in decision-making should be fully transparent and beyond reproach. We need a full and thorough investigation into what’s happened here.”
A Treasury spokeswoman said: “Treasury officials regularly meet with stakeholders to discuss our economic response to Covid.
“The meetings in question were primarily about broadening the scope of CCFF to enable access for providers of supply chain finance, which – following a call for evidence and discussions with several other firms within the sector – we decided against and informed the businesses concerned.”
The Sunday Times said that Mr Cameron did not respond to a request to comment.