UK Government does not intend to nationalise Port Talbot steelworks – minister

Will Meakin-Durrant, Press Association Political Staff

The UK Government does not intend to nationalise the Tata steelworks at Port Talbot, a business minister has said.

Lord Leong said while the Steel Industry (Nationalisation) Bill “provides flexibility to intervene if a future need arises”, ministers had set their sights on taking only British Steel assets into public ownership.

The Bill, which would give ministers the power to nationalise steel businesses’ shares or property, has already cleared the Commons.

Peers in the House of Lords backed it at second reading on Tuesday, but the proposal faces further scrutiny at a later date before it can become law.

British Steel’s Scunthorpe steelworks, in north Lincolnshire, has been operating under a Government direction since last year, to prevent its Chinese owner Jingye from closing blast furnaces.

The company was not nationalised.

It is thought the Government previously tried to negotiate with British Steel’s owners on a commercial sale but failed to strike a deal.

“While we are strongly minded to use the powers in the Bill to nationalise the company, no decision has been made and taken, and any decision will be subject to a consideration of the public interest test,” Lord Leong said.

He later said: “The Government has got no plans to acquire any other steel undertakings but this Bill provides flexibility to intervene if a future need arises and the public interest test is met.

“The Government remains fully committed to securing the long-term future of steelmaking in Port Talbot through Tata Steel’s £1.25 billion transition to a state-of-the-art, electric arc furnace, supported by up to £500 million of Government funding.”

Blast furnaces at Port Talbot, on the South Wales coast near Swansea, closed in 2024.

New electric arc furnaces, which use an electric current to melt scrap steel or iron to produce steel, rather than coke, were due to open next year.

But Lord Leong said “grid delays” meant “timelines are still evolving and not yet finalised”.

He continued: “We remain fully committed to securing the long-term future of steelmaking in Port Talbot, and are working closely with all parties involved to identify mitigations and explore options to accelerate delivery.”

Former Plaid Cymru leader Lord Wigley had earlier said steelworks at both Port Talbot and Scunthorpe “should be developed in a manner that avoids strategic, economic or defence needs being limited to one location”.

He added: “There is widespread belief that the steel industry at Port Talbot has not been treated on an equal basis with that at Scunthorpe.

“Now, we don’t claim that Port Talbot should have preferential treatment but neither should Scunthorpe.”

‘Tight margin’

Conservative shadow business minister Lord Sharpe of Epsom warned “the steel sector has been operating on a tight margin for years and nationalisation does not make any of those problems disappear”.

He also said: “The Government says that the public interest will include considerations of national security, the economy and critical infrastructure.

“But could ministers be any more vague when they refer to the economic interests of the United Kingdom?”