The intervention follows a breakdown of consultations between the UK government and the Jingye Group, the Chinese owner of British Steel.
The UK government effectively managed British Steel to keep the explosive furnaces running after lawmakers approved emergency rescue.
With 3,500 jobs dependent on the balance, the UK minister pushed the law on Saturday, allowing the state to temporarily assume operational control.
The intervention follows a breakdown of talks between the UK government and the Chinese owner of British Steel, Jingye Group, and plans to move the company to a greener production method.
After the vote, British Prime Minister Starmer traveled to the site and warned that an explosion furnace that would lose $915,600 (£700,000) a day was on the verge of closure.
“You and your colleagues have been the backbone of British steel for years and it’s really important for us to recognize that,” Starmer said. “It’s your job, your life, your community, your family.”
Lawmakers were reminiscent of Easter breaks for an emergency Saturday sitting.
Business Secretary Jonathan Reynolds told MPS the new law gives the government the authority to control operations, to secure critical raw materials to ensure workers are paid and to maintain the furnace.
Reynolds said a full state acquisition is “increasingly more likely” given the actions of the company’s current owners. “Don’t act today will not even consider the more desirable outcome,” he said.
The bill did not oppose the House.
If nationalized, British Steel will become the UK’s largest state rescue since the 2008 banking crisis.
The collapse of the Scunthorpe business will leave the UK as the only G7 country that cannot produce virgin steel made directly from raw materials such as iron ore and cola.
Already under pressure from global oversupply and rising energy prices, the company has further impacted 5% of annual steel exports worth around $520 million, further crashing into new tariffs of 25%.
Reynolds also vowed to lift US trade restrictions while emphasizing that reliance on foreign steel would grow if the furnace was closed, and pledged to fight for the future.
The government has already pledged $3.2 billion to support the steel sector, and is aiming to announce its long-term strategy in the coming months.
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