The business secretary refused to assure Scunthorpe's explosion furnace would get the raw materials in time. The emergency government action says it means there is a “highly trusted bar” for Chinese companies to invest in key UK industries.
Jonathan Reynolds refused to directly accuse British steel owner Gingy of obstructing the factory, but it is understood that the minister does not expect the company to return to negotiations.
“It may not be a disruptor, it may be neglecting,” Reynolds told the BBC. “The conscious decision to sell existing supplies of raw materials rather than ordering raw materials is a critical change that governments need to step in.”
Reynolds said the cost to the economy of shutting down factories and losing the country's steelmaking capabilities, and the major unemployment that comes with is at least £1 billion, exceeding the expected losses of nationalizing factories.
If the factory can continue operating, a decision regarding full nationalization is expected to be made in the next two weeks.
Reynolds told BBC's Laura Quensberg that it would not “make my situation or the situation in the country more difficult” by explaining more about whether steel explosion furnaces could continue to operate. If the furnace runs out of raw materials, they become obsolete.
A day after Parliament passed a one-day bill that took away emergency powers to control the Scunthorpe site, Reynolds said the UK “gives the opportunity, we control the site, my staff are now on the ground to give us the opportunity to do it.”
However, he said he was too commercially sensitive to see if the government could ensure that factories remain open.
China's company Jingye, which purchased British steel in 2019, stopped ordering more raw materials, started selling supplies they already had, reduced the offer of support by £500 million, and refused to ensure that the furnace would remain in operation.
“That would become clear to me, and for the government, the financial offer of generosity would not have been accepted,” Reynolds said. “This is the situation on April 10th and we agreed by the Cabinet on Friday. Congress was recalled on Saturday and we are here.”
The business secretary told Sky News there was a “high trust bar” to bring Chinese investments to the UK, and he refused to allow Chinese companies to invest in the “sensitive” steel sector.
Reynolds said the company's annual loss is £233 million, and that figure “can be improved.” However, he said the cost of nationalisation must be compared to the cost of allowing factories to enter the area.
He said it does not mean further borrowing to nationalize the plants. “There's an allocation in the initial budget of the Steel Fund of over £2.5 billion. If you're spending some of that money to support steel in the short term, I think it's better for taxpayers to spend more money now than spending transitions with companies I'm not sure I'm right now. [of that].
“If that had been reduced, that number of jobs, land repairs, and support for those who have lost their jobs would be well over £1 billion.”
Reynolds said he would not accus China of state interference, but the company said “it's not the case.” [acting] We expect businesses to operate in a market economy in a reasonable way. ”
British reform leader Nigel Farage accused Jinsie of lying about the company's accounts and told Jinsie that she was “100% certain” to buy British steel to shut down its business. Farage did not provide evidence of these accusations, but said it was based on his “intuition.”
“Why do you think yesterday morning the union acted to stop Chinese officials from even putting cars in plants?
Gary Smith, general secretary of the GMB union, confirmed that workers acted to halt access to the company.
“We were worried about industrial vandalism, but we were worried about the interference at the site. “And yesterday, workers prevented executives of Chinese owners from going to the scene.
“I'm sure people are still very concerned about it, but these people played heroes yesterday to ensure we have a fighting opportunity for the steel industry in this country.
