British Steel has announced it will not continue with a consultation on making 2,700 workers redundant at its Scunthorpe plant.

In March, the company – owned by the Chinese firm Jingye – had proposed closing the two blast furnaces at the site due to significant financial losses.

However, the government stepped in earlier this month to ensure that raw materials reached the site so that the furnaces could remain operational.

In a rare Saturday recall of parliament, ministers were granted emergency powers to take control of British Steel and continue production. The Steel Special Measures Act was passed on 12 April.

British Steel

British Steel could be nationalised to save future 

British Steel to shed 2,700 jobs at Scunthorpe plant

The Department for Business and Trade (DBT) has said it would not rule out nationalising the company if necessary.

British Steel confirmed yesterday (22 April) that it has officially withdrawn the HR1 redundancy consultation form submitted to DBT on 27 March, and that all operations would continue.

The company said it had worked “at pace” with the government to ensure the supply of raw materials, avoiding the need for a “salamander tap” on one of the furnaces, which means drilling a hole in the bottom to let out molten metal and slag.

Lisa Coulson, interim chief commercial officer at British Steel, said: “This has been a difficult and worrying time for British Steel staff and their families. I can, however, confirm that we are closing the redundancy consultation without action.

“Since the government passed its legislation, we have been working day and night to ensure we are able to stabilise our operations.

“The work done to secure the raw materials we need for both Queen Anne and Queen Bess blast furnaces means we are able to run both continuously.”

Unions welcomed the announcement, with Unite declaring that British Steel “have come to their senses”.

A spokesperson said: “This should be just the first step to begin the process of nationalisation.

“The government now needs to implement a wholesale overhaul of its energy policy with a commitment to invest in renewables to lower energy prices for heavy industry like steel production.”

Alun Davies, national secretary for steel at the Community Union, said: “We welcome these positive developments, which follow constructive discussions between steel unions, the Labour government and British Steel management.

“We look forward to continuing these productive relationships going forward. Through this collective effort, backed up by the commitment and resolve of the workforce, Scunthorpe steelmaking was saved from a disastrous cliff edge.

“We will now continue to work tirelessly to ensure the business gets the bright future it needs and deserves.”

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