The UK government has spent £377 million in nine months to keep British Steel's Scunthorpe site operating, according to a report from the National Audit Office (NAO). The ongoing operations are costing the Department of Business and Trade (DBT) about £1.3 million per day, with no set budget, repayment schedule, or end date.
Key Takeaways
The UK government has spent £377 million to keep British Steel's Scunthorpe site operating, costing about £1.3 million daily without a set budget or repayment schedule.
- Government intervention prevents closure of last blast furnaces in April 2025
- Spending on advisers and operations reaches £377m with no clear repayment plan
- Costs could exceed £1.5bn by 2028 if current rates continue
- Department for Business and Trade considers future options for the site
The government intervened in April 2025 to prevent the closure of the last two remaining blast furnaces in the UK, avoiding significant job losses and a serious impact on industry. The NAO report highlights that £15 million was spent on advisers, £359 million on operating activities like raw materials and payroll, and £3 million on legal costs at the North Lincolnshire plant.
The DBT has classified the £377 million as a loan, but there is no repayment schedule in place. The NAO warns that it is not apparent whether British Steel will be able to repay the loan. Spending is expected to reach £615 million by June, and if current rates continue, costs could exceed £1.5 billion by 2028.
The government is now considering options for the future of the site. A spokesperson stated their determination to support British steelmaking both currently and in the long term. The NAO suggests that the DBT should learn from this experience to be better prepared for future interventions.
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