It will cost huge sums for hard-pressed taxpayers at the expense of creaking public services. So it has been accompanied by the usual overblown rhetoric sprayed around at such pivotal moments, as Sir Keir Starmer rushed to Scunthorpe to tell relieved workers how he saved their plant. “Our industry is the pride of our history – and I want it to be our future too,” he proclaimed, insisting he was “turning the page on a decade of decline”.
Steel is an industry that provided jobs for more than 300,000 people half a century ago; today, it employs barely one-tenth of that number. Yet have no doubt: this is a desperate move that raises serious political questions, from the cost of net zero environmental policies in driving up energy prices through to the failure of landmark privatisations from the Thatcher era.
Scunthorpe is the last site left in the UK that makes blast furnace steel. It was run for five years by a Chinese firm named Jingye, which bought British Steel out of insolvency with promises to inject capital, save jobs and modernise the plant.
Bear in mind China is a brutal dictatorship where business, like the military, must be subservient to Communist party interests – as even tech titan Jack Ma found to his cost after criticism of their financial system led him to disappear and lose control of Alibaba.
square IAN BIRRELL
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Its companies are weapons in a fight for global dominance, just like the parts made in its factories for Russian drones killing Ukrainians. From electric car batteries through to solar panels, its manufacturing output is massively subsidised by a state that engages in dumping cheap goods and cyber theft to gain industrial, military and technological advantage over the West. Its trade is neither free nor fair – and sometimes boosted by slave labour. Yet we have seen a succession of Tory and Labour ministers prostrate themselves pitifully before this vile regime.
British Steel went bust before under the control of Greybull Capital, which paid £1 to purchase the firm in 2016. It invested also in electrical retailer Comet, which had cost taxpayers £45m when collapsing three years earlier, and ran Monarch Airlines when it went under with debts of almost £500m, sparking the biggest repatriation of stranded Britons since the Second World War. Greybull claimed to have rescued the steelmaker, secured significant funding and restored it to profitability only for “additional blows dealt by Brexit-related issues” to prove “insurmountable”. Yet the Financial Times reported that Greybull put in just £20m of its own capital, while elsewhere it was reported to be taking the same annual sum in management fees and loan interest payments – as well as collecting generous government grants.
Yet the pin-striped vultures of private equity have invested in at least 50,000 firms worldwide, using their immense influence and wealth to stifle political restraints – even over their activities in the most sensitive public services such as fostering of vulnerable children and care of citizens with learning disabilities.
Now we see the collapse of another celebrated British brand, leading to another costly state rescue mission. So will our leaders ever wake up to the cause of such catastrophes that stoke the fires of political populism – and steel themselves to challenge the real villains behind this latest crisis, both at home and abroad?
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