As the UK steel industry teeters on the brink of collapse, MPs have approved a bill aimed at safeguarding production and preventing plant closures. The move comes amid growing concerns over Chinese ownership and the government’s handling of the situation.
The steel industry (special measures) bill has cleared its first hurdle after MPs approved it at all stages. It will now proceed to the House of Lords for debate and passage.
The government has been facing criticism over its handling of the situation, with many MPs expressing concerns about the lack of transparency and the potential risks posed by Chinese ownership. The bill aims to safeguard UK steel production and prevent the closure of blast furnaces at the Scunthorpe plant.
China's growing economic influence has led to increased foreign ownership, particularly in strategic sectors such as real estate and technology.
According to a report by the United Nations Conference on Trade and Development (UNCTAD), China's outward foreign direct investment (FDI) stock reached $1.5 trillion in 2020.
The Chinese government has implemented policies to encourage foreign investment, including the Belt and Road Initiative (BRI).
However, concerns over national security and intellectual property protection have led some countries to impose restrictions on Chinese ownership.
Opposition parties have tabled eight amendments to the government’s steel industry bill, including proposals to extend the bill’s scope to other parts of the UK beyond England, impose time limits for using the powers in the bill, and call for nationalisation of affected steelworks. The Conservative Party has expressed concerns about the potential impact on the private sector.
Industry leaders have welcomed the government’s intervention, with UK Steel director general Gareth Stace saying that the bill will allow the British Steel site at Scunthorpe to maintain operations while negotiations continue. However, Community Union assistant general secretary Alasdair McDiarmid has criticized the government for not consulting with unions and warned of the need for a sustainable future for British Steel.
Shadow environment secretary Victoria Atkins has expressed concerns about the cost of the emergency legislation to taxpayers, warning that the bill does not contain sufficient detail to safeguard jobs and protect the steel industry. Minister Sarah Jones refused to comment on reports that Chinese owners had been blocked from entering the plant by workers.
Lord Reid of Cardowan has argued that the previous Conservative government sold off the British steel industry to China, which may be in Beijing’s interest in a competitive world. The UK Steel director general has welcomed the government’s intervention, saying it will allow the blast furnaces at Scunthorpe to remain operational during negotiations.
The steel industry is facing significant challenges, with Tata Steel announcing over 2,800 job losses at its Port Talbot site in Wales last year. The lack of transparency and support from the government has been criticized by opposition parties, who argue that this is a national security issue that requires urgent attention.
The steel industry bill has passed its first hurdle, but many questions remain about the government’s response to Chinese ownership and the potential risks posed to UK steel production. As the bill proceeds to the House of Lords for debate and passage, it remains to be seen whether sufficient measures will be taken to safeguard jobs and protect the industry.
Industry leaders have welcomed the government’s intervention, with “it will allow the British Steel site at Scunthorpe to maintain operations while negotiations continue” said by Gareth Stace. However, “the government for not consulting with unions and warned of the need for a sustainable future for British Steel” was criticized by Alasdair McDiarmid.
Minister Sarah Jones refused to comment on reports that “Chinese owners had been blocked from entering the plant by workers”.
