Steel Industry (Nationalisation) Bill

Edward Leigh Excerpts

Committee of the whole House
Monday 8th June 2026 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)]

I thank the shadow Minister, the hon. Member for West Worcestershire (Dame Harriett Baldwin), for her incredibly generous remarks at the start of the debate. I think we all try our best here with whatever expertise we have; of course, I recognise her expertise in finance, and will aim to address some of the serious issues she raised.

At the heart of the Bill and this debate is the future of our steel industry. The difference in opinion between the Government and the Opposition over the use of nationalisation as a tool of industrial strategy may be irreconcilable, but it is a useful tool—although not one to be used lightly. It is important that it is used in situations of market failure or some other private sector issue, which is certainly the case today. It was also the case when the previous Conservative Government briefly nationalised one of our steel companies, before that led to a failed private sector ownership.

[Sir Edward Leigh (Gainsborough) (Con)]

Yes, the Minister is right: Greg Clark nationalised it. As far as my constituents who work at Scunthorpe are concerned—and, I am sure, those of my hon. Friend the Member for Brigg and Immingham (Martin Vickers)—all we want is a viable Scunthorpe. We do not take an ideological line on nationalisation in this case. Given the problems we are now reading about in respect of electric arc technology in Port Talbot, can the Minister commit that the Government are fully committed to the blast furnaces in Scunthorpe?

[Chris McDonald]

Perhaps I can even give a slightly fuller answer than that. The particular issue with that previous nationalisation by the then Secretary of State was that it was effected merely to create a change of ownership, without actually improving the quality of the business or attracting additional investment into the business at the time. It is important to take this Bill in the full context of our steel trade measures and our steel strategy, which lays out a forward plan for the steel industry. Nationalisation is one of the tools that we can use.

The Government have been clear in our steel strategy that we see a transition to electric arc furnaces over time—there are good reasons for that, not least because they are the most productive and efficient technology available and are reliable and tried and tested—but our intervention in the Steel Industry (Special Measures) Act 2025 and our ongoing support of the British Steel business has been to ensure that we have blast furnace-produced primary steel available as part of that transition. The furnaces in Scunthorpe are the only two working blast furnaces in the UK, and they are currently our only source of primary steel.

The right hon. Member for Gainsborough (Sir Edward Leigh) also raised reports in the press about delays to the project in south Wales. Delays on such a large project are not unusual, but the specific issue in that case was around the groundworks—I would certainly be happy to expand on that more if it becomes part of the debate. I am, of course, in close contact with Tata Steel about that. In my experience of such projects, it is always difficult to understand what the duration of the project will be until it gets out of the ground, and ultimately there are issues with the groundworks there.

Let me move on to address amendment 21 and the issues raised by the shadow Minister. In terms of its structure, the Bill is very much modelled on the Banking Act 2009, which received incredibly broad support. The clauses in part 1 are vital to the operation of the Bill, and I urge the Committee to reject attempts to remove them.

While I understand the consideration that has gone into the preparation of the amendments, narrowing the scope of the definition of a steel undertaking would, in the Government’s view, introduce ambiguity rather than clarity. In practice, there are unlikely to be many undertakings operating at scale in both steelmaking and an unrelated business practice; if there were, the Government would look to exercise powers in a way that focused on what was necessary to operate the steelmaking business. The drafting of the Bill follows on from the text of the Steel Industry (Special Measures) Act. The Government are therefore of the view that amendment 21 is not necessary.

--- Later in debate ---

[Richard Tice]

It is my judgment that the Conservative party’s amendment would prevent the Government from getting on and setting out the vision, placing the investment that is required, and giving the confidence to everybody that there will be a steel-making capability for primary steel. Once we get that investment in the core asset in Scunthorpe—with a refurbished, renewed blast furnace that is ready for the next 50 years—then, with brilliant management from the private sector, we will start to attract private sector capital, which we all want to bring in. This is a moment that requires the proper seed investment, the commitment and the courage from this Government to get on with it, which was so lacking in the previous Administration.

[Sir Edward Leigh]

I agree with a lot of what the hon. Gentleman says. We can surely agree on this point: what is really killing Scunthorpe are the insane green energy policies and the fact that we have the highest energy costs in Europe. If we had a sane energy policy, we could start to make a profit at Scunthorpe.

[Richard Tice]

The Father of the House is absolutely spot on. The net-stupid-zero policies have been catastrophic across the piece, and I fear that those very policies are the reason why people are concerned about the possibility of opening an electric arc furnace. That puts even greater pressure on the need to have a renewed, brilliant, wonderful blast furnace capability for the next 50 years. If we achieve those things, we can bring in private sector capability with a pro-British procurement strategy. That will give confidence to all.

It has been mentioned that the Bill would somehow prevent other investment from the private sector. The discussions that I have had with overseas pension funds and overseas sovereign wealth funds suggest exactly the opposite. They suggest that, with this sense of commitment—what I like to call a joint venture with the core asset, under public ownership—we will attract more international investment, because people will know that there is a long-term commitment as opposed to the wibbly-wobbly, flip-flop approach of previous regimes. That is the reason that we need to get on with this. We need to ignore any delaying amendments.

Let us have the vision. New clause 5 would require the Government within three months to set out that 10-year vision and 10-year commitment to the blast furnaces and others in the steel undertaking, to ensure that we have a vibrant and, ultimately, viable primary steel-making capability in the United Kingdom.