Find a credible plan for British Steel, ministers told as ‘startling’ costs soar

British Steel was taken into public ownership in July. Photograph: Darren Staples/Reuters View image in fullscreen British Steel was taken into public ownership in July. Photograph: Darren Staples/Reuters Find a credible plan for British Steel, ministers told as ‘startling’ costs soar Government spending watchdog warns of price of keeping publicly owned firm in business Labour has been urged to lay out a credible plan for the future of British Steel, as the government spending watchdog warned of the “startling” costs of keeping the struggling manufacturer in business with no end in sight. British Steel was taken into public ownership in July to protect “the future of steel production”, 15 months after the government stepped in to prevent the closure of its steelworks in Scunthorpe and the loss of 4,000 jobs. But it is costing £1.3m a day to keep the company running, with the total estimated cost reaching as much as £1.5bn by 2028. By mid-June, the government had spent £555m paying workers’ salaries and buying raw materials, excluding the cost of external advisers. The public accounts committee of MPs said on Friday that ministers were still “unable to articulate what business model” would put the company on a sustainable footing, nearly a year and a half after taking control at Scunthorpe. It added that the Department for Business and Trade had not given “even indicative estimates” of how much British Steel would ultimately cost taxpayers or how long the situation would continue. After nationalising British Steel, the government appointed new bosses to focus on stabilising the business. Clive Betts, the committee’s deputy chair, said the move to save the company was “all well and good”, but added: “This was just the beginning. Having brought British Steel onto the taxpayers’ books, it is now up to government to explain its plan for its future. “Unfortunately, beyond simply propping up the company with public money, the government was not able to outline such a plan to our inquiry. The reality is that British Steel is unable to wash its own face, and government is now in charge of making sure it gets on to a sustainable financial footing for the future. “We also require assurances that the startling levels of funding British Steel is currently receiving do not come at the expense of the wider sector.” The criticism came days after Labour also nationalised Britain’s third-biggest producer of the metal, the Yorkshire-based Speciality Steel UK, in an attempt to protect 1,300 jobs.