Campaigners have welcomed a plan which could rescue collapsed British Steel and safeguard nearly 25,000 jobs.
Business Secretary Greg Clark backpedalled yesterday after outrage that Britain’s second biggest steelmaker could be left to go under.
After initially saying the Tories could not bail out the debt-ridden giant, he proposed the Government act as a “cornerstone investor,” alongside a group of private companies.
As Mr Clark unveiled his idea, a Government whip told MPs that steel must be protected to stop the UK “being held to ransom” by other countries.
Mark Spencer said: “We recognise how important it is to have a steel industry.”
(Image: Getty)
The Clark plan could safeguard 4,500 direct jobs at its plant in Scunthorpe, North Lincs, and on Teesside.
Another 20,000 in the supply chain could be saved after the firm plunged into liquidation.
Mr Clark wants to ensure his plan doesn’t contravene EU state-aid rules. He said: “Sometimes it’s necessary for the Government to participate where discontinuity can be so difficult to recover from.”
Shadow Steel Minister Gill Furniss added: “Anything to provide security for British Steel has to be good. Labour will watch to ensure these are not [just] warm words.”
Laurence Turner, of the GMB, wants all realistic options looked at.
British Steel was placed in receivership on Wednesday after owners Greybull Capital failed to secure a £30million loan. It will keep running during rescue bids.
Labour and the unions have called for the firm to be nationalised.
