The Government will pursue “every option” to keep steel-making in South Yorkshire, an industry minister has said after Speciality Steel UK went into insolvency last month.
Sarah Jones said she “very much believes” that the steelworks have a future in South Yorkshire, and in the West Midlands.
In a statement to the Commons on Tuesday, Ms Jones said the Government “stands with” all those affected – the workers, families and communities – and that there will be no immediate changes, including to jobs.
The Government took control of Speciality Steel UK, the country’s third largest steelworks, in August in a bid to save nearly 1,500 jobs.
It came after the high court confirmed that Speciality Steel, previously part of Sanjeev Gupta’s Liberty Steel business, would face compulsory liquidation.
The operation has plants in Rotherham, Stockbridge and Brinsworth in South Yorkshire, as well as Wednesbury in the West Midlands.
The firm has been placed into the hands of the Official Receiver, a government official that manages bankruptcies, and special managers from advisory firm Teneo.
Ms Jones told MPs: “The Government stands with the affected steel workers in Rotherham, in Sheffield and in Wednesbury.
“We stand with their families and the communities who will undoubtedly be worried at this very difficult time.
“I would like to reassure them and all those employed by Liberty Speciality Steels that we are standing by with our rapid response teams to give immediate support on the ground, if required.
“We are working with the trade unions and the South Yorkshire Mayor and we are working with the councils and MPs from affected constituencies to offer all the help we can.
“I also want to stress that there will be no immediate changes to the current operation of the business, including employees’ jobs.”
She added: “I very much believe that these steel-making sites in Rotherham, in Stockbridge, Brinsworth and Wednesbury, have a future, and I am keen to see them return to production.
“But this has to be achieved through private investment by an owner who can invest in the workforce and invest in the future of the business, so that they can put it on a long-term sustainable footing…
“We will pursue every option to keep steel-making in Rotherham, in Sheffield, in South Yorkshire and the West Midlands.”
The industry minister told MPs that it would have been “wholly inappropriate” for the Government to have entered into commercial arrangements with the steelworks company.
Liberty Speciality Steels had failed to file accounts for over six years, she said, leading to a prosecution from Companies House, and the company’s director is under investigation for suspected fraud, fraudulent trading and money laundering.
She said: “In the case of Liberty Steel, the lack of transparency, the legal and financial risks and the complete absence of reliable corporate information meant we had no credible route to act before insolvency.”
Responding, shadow business minister Gareth Davies accused the Government of failing British industry.
He said: “Despite so many warm words about the steel industry, despite so many Labour promises to the people who have worked their whole lives in the steel industry, and despite the impression of superiority while in opposition, this Labour government is failing British industry.
“It is failing to provide certainty of policy, of economic growth that it said was its central mission, and it is failing to get a grip on the issues that affect thousands of people’s lives, working people’s lives.”
The shadow business minister said British steel was facing dual pressures from tariffs and high energy costs, and criticised the Government’s “ideological obsession” with prioritising green policies over economic growth.
Ms Jones said the Government had already intervened to protect thousands of jobs in Scunthorpe and secured a better deal for workers in Port Talbot.
She said: “We are spending money where we can on British business, something his government failed to do.”
Rotherham MP Sarah Champion said the Government’s response is “night and day from what we had under the Conservatives”.
The Labour backbencher said she is “pleased that the Labour Government has taken resolute action to safeguard the future of this vital strategic business”.
Liberal Democrat business spokesperson Sarah Olney said: “With Putin’s barbaric war in Europe and Donald Trump’s damaging tariffs causing economic turmoil, securing the future of steel production in this country is more important than ever.”
She added: “Liberal Democrats firmly believe that nothing should be off the table in supporting this critical sector.”
Reform UK deputy leader Richard Tice said: “I think there’s a better solution, which I have spoken about outside of this House, which is to merge Speciality Steels with British Steel to create a cohesive, excellent, strong champion of our steel industry that we all say we support into the future and invest in it. That’s the way to ensure economic growth in this country.”
Ms Jones said it was important for creditors for Speciality Steels to get compensation for any money owed.
She added: “The idea he suggests is not necessarily a foolish one, on this occasion. What the Official Receiver has to legally do, this is a legal process, they have to think of the creditors who have suffered throughout this.”
