Perhaps the nominal irony was always unsustainable: British Steel Ltd, owned by a company headquartered in Beijing. Ultimately it fell to Keir Starmer to correct the discrepancy. Flanked by two large Union Flags, Starmer, with a gravitas befitting the death of a monarch or a currency devaluation, declared that “our economic and national security are all on the line” and that the government will be acting “to secure Britain’s future”. And, in case we didn’t quite get the message, this secure future will be “with British steel, made in Britain, in the national interest”.
This could have surprised the newly redundant former steel workers of South Wales, who might have wondered if Starmer had meant to say the government was securing English jobs with English steel, made in England. But for them and many others the “national crisis” tenor of the week’s events will have seemed like a very late and unexpected conversion to the cause of retaining a virgin steel-making capacity in the UK. For others, the surprise might have been that there was any steel-making industry left to save.
Of course, the government really ought to have seen this crisis coming: it has been 50 years in the making. Like many of Britain’s traditional industries, iron and steel production in the UK has a long history characterised by technical innovation, one-time global pre-eminence and a subsequent period of mostly mismanaged decline leading to huge job losses, regional economic desolation and broken communities. Nationalised twice by Labour governments (Atlee in 1949 and Wilson in 1967), re-privatised twice by Conservative governments (piecemeal in the 1950s and wholesale in 1988) and later subjected to the full force of New Labour and Conservative neoliberalism, the UK steel industry has seen its output shrink by around 80 per cent since its early 1970s peak. Employment in the industry fell by 90 per cent during the same period. By 2023, the industry produced just 0.3 per cent of global output, supplying around 40 per cent of the UK’s steel demand.
When Labour came to power last July, the industry was down to three blast furnaces (a fourth had been shut down on election day) and talks were already underway for the UK government to subsidise the replacement of all the remaining three with “greener”, less carbon intensive, electric arc furnaces, producing recycled, non-virgin steel. The Labour government nodded through the previous government’s £500m agreement with Tata Steel UK to close the remaining blast furnace at Port Talbot (at a cost of 2,800 jobs) but was unable to reach a similar agreement with Jingye, the Chinese owner of British Steel. Labour then appeared unconcerned about the loss of virgin steel production at the Scunthorpe plant and, but for the apparent intransigence of Jingye, the blast furnaces might well have been shut down by now.
But now blast furnaces have taken on a significance of totemic proportions. And a national capacity to produce virgin steel (a global commodity freely available to import from neighbouring friendly allies), now appears to be a necessary qualification to be taken seriously as an industrial power in the G7. Perhaps stung by the widespread criticism that followed the closure of the Port Talbot furnaces and no doubt re-energised politically in 2025 by the uncertainties of the Trump-disrupted world order, Starmer has shown a bit of steel himself and, following the lead of the two Labour prime ministers he most admires, the government has effectively nationalised the Scunthorpe plant. National capitalism has succeeded its neoliberal predecessor.
With the immediate crisis having abated, it is unclear what medium to long term plans Labour have for the British Steel blast furnaces. The Government’s February 2025 foreword to its steel strategy consultation, with its focus on the “increased use of scrap steel in production” and “transition to green steel”, already looks out of date (that strategy is due to be introduced this spring). The £2.5 billion already earmarked “to clean steel” looks likely to be spent, at least in part, on keeping the industry dirty for a while longer.
Two lessons from all this should not be lost on Starmer. After three decades of neoliberal economics and an increasingly globalised control of British industry, finance and infrastructure, it clearly matters where the control of strategic and nationally important assets lie. It is not enough to claim that all that is important is “where the R&D is located”. According to reports, the government stepped in over the weekend to take control of British Steel because Jingye, having presumably tired of the loss-making blast furnaces, was seeking to scupper the Scunthorpe plant’s future by selling the essential raw materials already en route to Scunthorpe. In classic understatement, a government source described Jingye as “no longer trustworthy partners”. And, in the new global order where trust is increasingly having to be re-earned, Starmer should see state intervention, including further nationalisations, as the way forward.
Starmer should also recognise how an uncertain global economy engendered by the on-off-on Trump tariffs threatens an already stagnant British economy, and why the preservation of current British jobs – even in traditional “dirty” industries – must take priority over the prospect of future “green” jobs created under Labour’s ambitions to be a clean energy superpower. Much has been made in the last week of the disconnect between the government’s rapid (if last-minute) response to take control of British Steel and its opposition last year to the controversial coking coal mine proposal for Whitehaven in Cumbria. Both Tory and Reform MPs have drawn attention to the apparent farce of seeking emergency powers to obtain coking coal from Japan while having previously declined “the opportunity to use British coal from Cumbria”, as Richard Tice put it.
In truth, the mining project was never going to be operational in time to help save the Scunthorpe furnaces, nor is the coal suitable (85 per cent was expected to be exported). But the point is not purely rhetorical. The Whitehaven proposal was expected to create 500 jobs in an archetypal left-behind region, one that lost its steelmaking, coal mining and chemical industries within a single generation. It was an early test of Labour’s commitment to levelling up and economic growth. But the Labour government, in one of its first decisions upon assuming office, failed the test by choosing not to defend the previous administration’s planning permission, with Angela Rayner meekly describing it as an “error in law”.
Having made economic growth the government’s overriding priority, Keir Starmer can no longer afford to allow the ideological obsession with carbon emissions to emasculate British industry and business. Having decided to back airport expansion at Heathrow, Gatwick and Luton, the government will soon have to rethink its commitment against new oil and gas development licenses in the North Sea. Starmer’s 2025 reinvention as a “realist” in the mould of an Attlee or Bevin (a far more noble tradition than the Maga claiming of the word) and his repeated commitment to tackle the “blockers” means he will need to take on many of his party’s activist supporters and a number of his own MPs. He will also need to recognise that many of the most effective blockers are his former colleagues in the judiciary and legal chambers.
In last Friday’s short speech, Keir Starmer described the steel industry as “part of our national story, part of the pride and heritage of this nation”. In recalling Parliament and taking emergency measures, Starmer laid down a marker for his government’s willingness to intervene in support of British industry. As a metaphor for keeping alight the dwindling fires of British industry, the events of the week couldn’t have been more literal. Keir Starmer will not want to be the one who lets the fire go out.
[See also: The cost of net zero in the town that steel built]
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