The loss-making firm was taken into Government control amid panic last April

British Steel has been formally brought under public ownership in what the Prime Minister has said will "safeguard a vital national capability".

The loss-making firm was taken into Government control amid panic last April after it emerged that Jingye, its Chinese owner since 2020, had drawn up plans to close its two blast furnaces at Scunthorpe.

The Department for Business and Trade had yesterday said it was "strongly minded" to use the new powers in the case of British Steel.

"The Steel Act gives us powers to nationalise steel companies where it's necessary in the public interest, to protect a foundation industry that supports our critical national infrastructure, economy and defence," the DBT said.

While Sir Keir Starmer added the move "secures the future of steelmaking in the UK, protects skilled jobs and safeguards a vital national capability".

“British Steel is part of the fabric of our nation and a cornerstone of Britain’s industrial strength," he said.

“This Government will always act in the national interest to support British industry, strengthen our economy and ensure the industries we rely on can thrive long into the future.”

Business Secretary Peter Kyle this morning told GB News that Britain would be left "entirely dependent" on imports of virgin steel if he did not "take the big, bold decision" to step in and take the firm into public ownership.

"It's a foundation of our economy," he said, warning that losing it would leave the country "extremely vulnerable".

"If this plant were to disappear, it means that we would be left to the mercy of the international markets."

And if its furnaces had lost fuel and gone out, Britain would have lost the ability to produce virgin steel because restarting them would have been extremely difficult and expensive.

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To make virgin steel, iron must be extracted from its original source, then purified.

It is then treated to make various types of steel used in major construction, infrastructure and defence projects.

British Steel employs around 4,000 people across its sites in Scunthorpe and Teesside.

Earlier this year, the firm secured a record order through a landmark UK-Nigeria agreement - a deal seen as a major boost for its export pipeline and long‑term order book.

Ben Houchen, the Conservative Mayor of Tees Valley, said he supported the potential nationalisation after plans to do it were announced in May.

He had been lobbying the Government since last year to sign off on subsidies for Jingye to build electric arc furnaces at Scunthorpe and Redcar.

There had been overwhelming cross-party support for nationalising the firm last year when Jingye's plans to shut the Scunthorpe plant emerged.

Reform UK leader Nigel Farage, whose party courted the unions as it rallied to save the Scunthorpe works ahead of last year's dramatic emergency vote, warned how China had "no interest in keeping the steelworks open".

"Reform have been clear from the start that the only option we have to save this vital strategic asset - and thousands of jobs in the process - is to nationalise British Steel," he added.