Minister says 'bright future' for steelmaking

Chris McDonald met with officials at Scunthorpe's British Steel plant

Industry minister Chris McDonald says there is "a really bright future" for steelmaking in Scunthorpe and across the rest of the UK.

He was speaking during a visit to the Chinese-owned British Steel plant in North Lincolnshire.

The government took control of British Steel in April, amid concerns owners Jingye would close down the UK's only remaining blast furnaces and put thousands of jobs at risk.

McDonald said the government was committed to ensuring a sustainable steel industry in Scunthorpe in the long-term.

The plant is the last remaining site in the UK producing virgin steel

Speaking to the BBC, he said: "The fact we took control of the Scunthorpe steelworks back in April was a major commitment by the government to retain this steel company, but also the capabilities here as well."

British Steel's Scunthorpe plant is the last remaining site in the UK producing virgin steel.

McDonald said he had met with the owners, as well as union representatives and the local MP, during his visit to discuss future plans to see how the business could be developed and to ensure "we can continue to make steel here in Scunthorpe and employ people locally in good jobs".

"We want to get to a position where we have a profitable, sustainable business here that can access private sector investment and partnership, along with government support," he said.

In March, Jingye said the plant was losing about £700,000 a day and launched a consultation on its closure, arguing the blast furnaces were "no longer financially sustainable".

Asked whether the government would keep the blast furnaces open, McDonald said most of the steel-making companies around the UK, and the world, were "progressing" towards electric arc furnace technology, which uses electricity to recycle scrap steel.

However, he said the government was expected to publish its steel strategy for the future before the end of the year.

On jobs, he added: "Investment in new technology and increases in productivity usually do result in fewer people working in an area, but that doesn't mean those people need to be cast out of work.

"Fundamentally, the big issue we have is around competitiveness and how we increase productivity."

However, regarding any future plans for the site, he said the government was determined not to repeat the "terrible industrial transitions" of the past.

"I'm determined that isn't going to happen in the steel industry," he said.

He said the government was investing huge amounts of money "in our clean energy revolution" and creating 800,000 jobs in green industries.

"I want the communities around Scunthorpe to be part of that," he added.

Meanwhile, Scunthorpe's Labour MP Sir Nic Dakin said it had been a "very positive" day.

"It's about the people here working with people in government to get the best for the future," he said.

When asked about McDonald's comments on electric arc furnaces, he said all options needed to considered and agreement reached on a future direction for the site that "everyone can get behind".

"That probably will mean some change," he added.

Sir Nic said an issue that needed to be resolved was the ownership of the site.

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