Laura Kuensbergpresventer, Sunday with Laura Kuensberg •@bbclaurakBbc
“Who was going to blink first?”
A source involved in the negotiations loaded since the elections on the future of British Steel told me that over time, and literally, the coal to keep the burned ovens began to run out, it was the question-was the government even more to the Chinese owners of British Steel, Jingye or would he act himself?
On Saturday, the government changed the law to answer this question.
Unless something really bizarre happens, Parliament will vote to give Jonathan Reynolds, the business secretary, the power to tell British Steel what to do – in practice, the purchase of coal to keep burning fires, to maintain the former steel industry in the past.
Even Thursday, he offered taxpayers money to buy raw materials to keep the ovens alive as a bidding for Jingye.
At one point in talks, sources suggest that they demanded a billionly pound bumpy to keep the plant alive. But I am told that the price would not have been accompanied by a guarantee that jobs would be saved or for good the factory.
Taking control on Saturday does not do that. Chinese owners will remain shareholders for the moment. But the work of the work of the work is literally and metaphorically maintains the flames alive – the government hopes. And he hires taxpayers to start coughing to save the steel industry – for how long is a more complicated question.
Media in Pennsylvania
The government says it has not excluded the nationalization of British Steel, which employs 2,700 people
So what then? Theoretically, Jingye could “come together and resume the business,” suggests an initiate.
Talking about interested parties on Friday evening, it seemed unlikely.
The British government has spent the last two weeks trying to try them to stay on board with huge incentives. This failed, so the chances of resuming the involvement seem quite thin.
Another company may want to dive and save the business.
Again, do not hold your breath – the company has lost money with the fist, the high stoves are approaching the end of their useful lifespan, and the cost of the energy it releases is enormous.
So, in the current state, assume the company as an offer? It’s not so pretty. Remember that Jingye was the only tenderer the last time – when a conservative source said: “There were no other tenderers – the alternative was closure or nationalization, and the conservatives were never going to nationalize”. So, work?
Reuters
British Steel says that it could soon be lacking in raw materials necessary to operate his two stoves
Since this weekend, it seems very likely. Remember that action in parliament later does not mean nationalization. But this is a necessary first step if this is what will happen.
You have probably heard ministers again and again say “all the options are on the table” – it is their Get Out of Jail card where they do not engage in anything in the case where their favorite option suddenly disappears. But while deputies come together to vote on the next steps, a trip to nationalization certainly resembles management.
Two different sources that have been part of the wider discussions tell me that the Prime Minister came to believe that bringing British steel back between public is what the government will have to do. There are practical and political reasons why it could take place.
First, for the government to have the hope of achieving its objectives – building infrastructure, spending more in defense at home, increasing the economy and protecting jobs – it is logical to preserve a steel industry in this country.
It is not only because ministers hate to see good jobs disappear. But because the government, the ability to do steel is an important part of what the United Kingdom needs to be able to do. If the factory closes, the United Kingdom would become the only G7 country without primary steel manufacturing capacity.
It was not something that the government was ready to tolerate. So if the private sector does not – enter the state. However, it would not be unfair to wonder why they ended up making this decision at the last minute when the fuel for the ovens is about to run out, since three weeks ago, the company sounded on possible closures.
Reuters
Rachel Reeves told workers that the government would consider nationalization if necessary to protect jobs
Second, this requirement to act has become politically attractive because it is part of the increasingly familiar script of Sir Keir Starmer, which the new world order has changed – governments must be more active and agile to protect their own interests.
It follows, if, like the Minister of the Treasury, Darren Jones, told us last week, globalization is over, then the United Kingdom must be able to manufacture materials and products like the steel it really needs.
A source points out: “dragging the conservatives to parliament during the weekend to support the plans of the Labor government to save British steel: I can finally see why people said that the government is worth it”.
It is politics after all.
Conservative chief Kemi Badenoch blamed the government’s “incompetence” for the last-minute recall, while the liberal democratic chief Sir Ed Davey said that it was an opportunity to find “a serious plan” for domestic steel production.
The head of the United Kingdom’s reform, Nigel Farage, said that the government’s plan was just a “short-term plaster” and that the Green Party called for the ownership of the public as the only option.
It should be remembered that the problems of the steel industry did not start with Donald Trump, or this government, or even Jingye. Steel was nationalized in 1967, then sold in the private sector in 1988.
Freetic negotiations with the government on jobs, reunions, survival are familiar. But there is a momentum around nationalization as a solution, in an unthinkable way not so long ago.
Hypothetical conversations started at the top of the government a few months ago on the possibility, a work detailed only in the last week approximately. But there is an increasing consensus – a source familiar with the situation said even: “nationalization is inevitable and has been for some time”.
Getty images
Conferences took place this week to try to maintain the company in progress, after its Chinese owner said that the Hauts Fourneaux are no longer financially viable
But – “The obstacles are enormous” – says a source. The most obvious obstacle? Cold Hard Cash, well beyond the initial price for raw materials in order to continue to Scantorpe for a few more weeks.
In the long term, the high stoves are towards the end of their lives, the factory needs investment, massive investment, to make it sure and to have an appropriate future. A source from the industry told me that modern electric ovens could have a price up to 3 billion pounds sterling each, and SCUTHORPE might need two.
The energy costs for new or existing ovens are enormous. At number 10 and number 11, it is grateful that energy costs for industry can be paralyzing. This could be another area where the government wishes to act.
The government has not yet shared, or has not yet worked, what is the potential cost of taking on the long -term factory. A cash source says it should be in the current spending plans. And you don’t need me to remind you again how tight the number 11 is how Chancellor Rachel Reeves wants to respect her expense rules.
And yet – if an effective nationalization of large posts is the political choice, and that it flows towards several billion? Let’s see.
The vote of deputies later will not determine the whole future of British Steel. But that puts the government on a path to make a part of its rhetoric in recent weeks, as a figure said – “neoliberalism is over. The property is again important – the workforce must define the place of Great Britain in this new, new world order”.
But passing a law in a precipitation is one thing. Political excitation another. Sir Keir used to attract the anger of the left of his own party to move away from some of his previous beliefs in common property, nationalizing the vital industries. Embarking on an expensive and complicated adventure to preserve an industry of several billion pounds in difficulty was not supposed to be part of the plan.
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