Lords speech ( tweaked in this written version from Hansard transcript)
I am very grateful to the Minister for his honest account of this legislation. He made it very clear that it is very likely that the strong powers in this legislation will be used sometime soon fully to nationalise the Scunthorpe works. That makes it even more curious that the Government he represents have given us an impact assessment with no numbers in it at all. There is no account of what a nationalisation of the Scunthorpe works would look like, what impact it would have on the public budgets, what impact, as my noble friend Lord Hunt said, it would have on the £2.5 billion allocated for steel as a whole. There is no account of how it would be a transfer of money we thought had been allocated for capital investment and modernisation in creating something new to the purpose of paying losses on a very old plant whose future is very uncertain. During this debate and over the course of this Bill, I hope we can get some numbers from the Government.
When the emergency legislation went through a year ago, both Houses of Parliament understood that the Government were not then in a position to produce numbers. At that point, in those debates in both Houses, strong voices said, “There must be a business plan; there must be budgets”. We were told at that stage that these would be forthcoming in relatively short order—but we await them. We still have a menu with no prices. We still have a lack of information about what the business plan of a nationalised Scunthorpe would look like. We have travelled for a year with a Scunthorpe that is run by the state and paid for by the state, but not owned by the state, making enormous losses. According to the press, these have been running at £1.3 million a day. We were offered no explanation of how long this might go on, when those green shoots the Minister reports will actually translate into real cash. How much steel does this plant needs to sell and at what kind of prices before it can have a positive margin or before it can maybe halve the negative margin which it has been running at for all too long? Indeed, we were told at the point when the state took on these mighty obligations that, under the previous Chinese owners, it had been losing about £700,000 a day. If the more recent press stories are right, the losses have clearly been considerably worse over the last year.
I understand that the Minister cannot firmly say they are definitely nationalising because they have put in this public interest test . They obviously have not yet applied the test to any project to nationalise which they are currently planning. Reading how wide the public interest test allows the Government to be in order to satisfy themselves, I do not think it is any actual prevention of the nationalisation of Scunthorpe. I am sure they are quite clever enough to come up with a plan that is well within the details of the public interest test, widely drawn as it is in this piece of legislation, so I do not think that is a reason for failing to give us proper figures.
I think it would also be good, over the course of this Bill’s debates, if we could hear a more honest statement to the workforce of Scunthorpe . The Government say two different things. They tell the press and the rest of us—and we are very relieved to hear it—that they have saved the jobs. They also say the Government is wedded to a net-zero strategy, which says that all blast furnaces of the Scunthorpe type have to close—and they are the only two left—to be replaced by electric arc furnaces. Therefore, if that is still the plan, we need to be told that honestly, and the workforce needs to be told that. There will be a very big reduction in the numbers of people working, should they switch from blast furnaces to electric arc furnaces in the case of Scunthorpe, as the Welsh steel industry discovered when the previous Government went on that journey, carried on by this Government, to replace those blast furnaces with electric arc furnaces.
Ministers should have a personal interest in wishing to get beneath the numbers and work out how much it is going to cost, because of pressures on public budgets and the need to assess this against alternative ways of spending the money. We read that, when the initial transfer of the liabilities and the running of the plant was made to the state, the senior civil servants apparently said to the Secretary of State and Ministers that they were not able at that point to sign off that this was value for money. They were not able to sign off that it was definitely going to be a policy that was going to work. They were not saying it definitely would not work: I think they were saying they did not have enough time and it would require a lot of very detailed work and consultation.
Ministers used their right to issue a direction to the Civil Service to say, “We think the public interest is such that this is urgent, and so we are going to ignore the absence of sign-off on value for money and on the efficacy of the policy because it is worth a shot and we, Ministers, will take responsibility”. I understand that. Having taken that responsibility, the Ministers are under more of a personal duty to come to this House and to the other place with proper budgets and proper business plans to show that there will be value for money as they go on this course. Indeed, I think we need a year’s audited statement on what has happened so far with all that money passing to a Chinese-owned business, which the state largely controls but where it does not own the assets.
It would be good as well to be updated on where the Government have got to in negotiating with the Chinese owners. I think it is tragic that we have not had a deal with the Chinese owners. Maybe it is the fault of the Chinese; I understand that there are two sides in any negotiation. When I looked from the outside, just using public sources, at what was on offer when the state moved in a year ago, I sketched what the state could sayto the Chinese owners. “We will take full responsibility for the workforce and their future payments, so we save you all the redundancy payments you would have had to make if you had carried out your closure”. The state would take on the land and buildings in the state that they were in, probably with many environmental obligations and costs of clean-up, and that would have been another relief for the Chinese authorities of the company, because otherwise they could be liable for having to clean up the site after they had closed it.
In return, the Government should have said, “You definitely keep all the debts you have incurred during your unsuccessful period of management, and the value of your share and your land and plant we would put at £1 to complete the transaction”. Some people thought I was being a bit generous there, but I think that was the shape of a deal that one might have been talking about. According to press comment, the Government have been thinking about £100 million of compensation for the liabilities that they are absorbing to also obtain the plant and the land in its current state.
We read in the press that the Chinese say that, no, they want £1 billion for this transfer of the freehold and the shares, which would seem to me to be extremely excessive in the circumstances. I would fully support the Government pushing back very hard on that and, if necessary, defending themselves in court if they cannot get a deal. But it would be in everybody’s interest if a deal could be reached. Getting to that deal would be helped if we had a published statement of the likely business plan for an enterprise now in public control and maybe soon to be in public ownership. That would also help create a mood for the negotiations with the Chinese.
I fear that that business plan, certainly for the last year and probably for the next year or so, would produce an awful lot of red ink. It would be the background to explaining to the Chinese why the idea that they might walk away with £100 million or £1 billion is for the birds. They have presided over a heavily loss-making business and they were unable to find a way to make it work, so they were thinking of incurring massive costs of closure as the alternative to carrying on with a very high rate of losses.
Like all the other speakers in this debate, I think we want a proud steel industry again in Britain, as we were used to having over many decades. I also think there is a case for keeping a virgin steel manufacturing capability, as well as a lot of electric arc recycling steel capability. That would require a study of how much longer one could carry on with these two blast furnaces, which the state will probably own quite soon. What sort of deep or long-term maintenance schedule is needed if it is thought that they can carry on, because these are quite ageing plants? That would perhaps be a better option than having to think about how to find an investor who wants to establish new virgin steel-making capability in our country.
What is very clear in the wider debate of the Minister and the Shadow Minister’s opening remarks is that we will not have that opportunity—through inward investment, or domestically financed investment, or City financing through private equity, or new equity issued through the AIM market, or whatever—of steel-making capability in this country as long as our energy prices are sky high.
We heard unfavourable comparisons in a previous good speech with European competitors, but, of course, they are not the main threat. Asia and America have energy prices considerably lower. In the case of the United States of America—a first-world competitor in many fields, with a much stronger economy than the European one—its electricity prices are one-quarter of the prices that industry in Britain has to pay before any subsidy.
The Government are following a bizarre policy towards energy. They put on massive carbon and emissions taxes, and all sorts of other taxes if we dare to produce any of the energy ourselves, or else we have to pay other people’s heavy oil and gas taxes as we import so much. Then they realise that this produces energy prices that mean the loss of jobs and the mass closure of industry. We have seen refineries and bits of the oil industry go, we have seen petrochemicals go, and we have seen a lot of our steel industry and a lot of our ceramics industry go.
So then they say, “Why don’t we offer a little bit back by way of subsidy to discount the very expensive energy prices we’ve got with these very high taxes imposed on the energy?” This is a very bad way of doing it: you get the worst of all possible worlds. You deter investment because the energy prices are too high. You do not give enough back in subsidy to make the businesses competitive, so they still close. You are left with a situation where you are deindustrialising, so your import bill for goods goes through the roof. Your import bill for energy also goes through the roof because of the bad mistakes made in the energy policy. That is why the UK is struggling so much.
So I plead with Ministers, for their own sakes, to do some sums: find some numbers, work out what the business case will look like, interrogate your managers, find out what you need to do to help them to sell more steel. Unless you can sell more Scunthorpe steel, there is no point pumping money in; you will not end up saving the jobs. And please tell your workforce whether you are serious about saving these jobs and really want to carry on with blast furnaces, or whether your net-zero preoccupations mean that their jobs are doomed anyway.
June 18, 2026
Logic and sums are not something this government is remotely interested in doing it seems. Plus even if they do they are unlikely to be honest about them or the future of UK steel. If they could do sums they would have never have started Miliband’s insane climate change Act agenda and lunacy of the vast net zero subsidies.
June 18, 2026
Perhaps the consequences Miliband has inflicted on the UK are possibly of greater harm than some prisoners serve 5 years for as punishment.
June 18, 2026
Peter Hitchens today “The decision to send Prince George to Eton is a terrible mistake. I am astonished no one at the Palace can see it” I tend to agree no a sensible decision politically but then even worse is pushing the climate alarmist scam King Charles and Prince William while spending million on flights, private jets, helicopters and Aston Martins (even if the Aston’s are allegedly run on cheese and wine waste).
So no one at the Palace nor it seems the royal family themselves can see very much it seems.
I suppose George will get a couple of Cs at A level then pop off to Oxford or Trinity Camb. (doubtless after a very good interview) to read something like Archaeology and Anthropology. Then again if they sent him to a bog standard Comp. he would get the benefit of extra a bid deprived Oxbridge points. Surely some rather less high profile private school would be a more sensible & political choice and keep him a bit more in touch with reality.
June 18, 2026
A very good speech Sir but a complete waste of breath. I think we all know the end result. Paying the Chinese the £billion they ask and we take on allvthe liabilities.
Plant closes, no Arc Furnaces are built and Milibrain chalks up another win.
His department has already committed to buying 1,750 metric tonne of stainless piping for his doomed Carbon Capture scam from South Korea without any pushback from Parliament.
The man’s is unhinged, Neso is telling him the grid is overwhelmed and to back off authorising new wind and solar but he ploughs on regardless.
There’s no end to this madness.
June 18, 2026
@Ian Wragg – unhinged? that’s a bit mild. As you suggest the majority in the UK Parliament unquestionably support the destruction of the UK. They all own Milibrain’s output, they chose to allow it, there is no get out clause, they are empowered and paid to hold Government to account and refuse.
June 18, 2026
Ian,
South Korea needed an IMF bailout in 1997.
I’m not suggesting that the UK are at that stage {yet}, but maybe we could learn something from them in that they now manufacture all the things that we used to make here – Ships, Cars, Tanks, Planes, Domestic appliances, Memory chips, Computers, Mobile phones etc. etc.
To paraphrase LL how do we get out of this “Doom Loop”?
June 18, 2026
Either the man in unhinged, insane or hates the UK. He read PPE Oxon but did get half decent A levels in Maths A, English A, Further Maths B, Physics B & from an Ordinary school. He should know rather better and be able to do a bit of maths. So is he just an enemy of the UK?
June 18, 2026
David Miliband got rather worse A levels but still managed a 1st at PPE Oxon.
June 18, 2026
Superb. Presumably you delivered this speech without the use of notes, which is even more impressive.
Reply No notes
June 18, 2026
No notes is impressive. Do you write it down first or just composes it as you go? When very occasionally it speak it tend just to have a few topic headings.
You say worst of all worlds:- You deter investment because the energy prices are too high. You do not give enough back in subsidy to make the businesses competitive, so they still close. You are left with a situation where you are deindustrialising, so your import bill for goods goes through the roof. Your import bill for energy also goes through the roof because of the bad mistakes made in the energy policy. That is why the UK is struggling so much.
Plus all the other red tape, planning restrictions, over taxation, employment laws, high crime rates, high property costs also deterring investment. Then also driving up inflation and interest rates. Plus very poor defences too. A doom loop agenda in every way.
Reply I just speak, only about topics I have researched before.
June 18, 2026
Well done, alas in politics they more usually just talk without any research on the topic or any understanding of it. The level of knowledge on science, energy, economics, defence procurement, transport or engineering in the Palace of Westminster and from most journalists is truly appalling. A bit like me giving a talk on for example Jean Racine without mugging up and my GCSE french!
June 18, 2026
It’s very odd that this government cannot tell us what the future for steel is going to be in this country when they know all too well that under the rules of net-0 the UK will cease to produce steel. They know this very well and yet they procrastinate in dealing with Scunthorpe, wasting more of our money by the day when redundancies are inevitable and the Chinese owners should be picking up the tab.
Nationalising the steel works will solve nothing but will create more expense for taxpayers – At least some of that cost should go to the current owners but it seems that HMG is so worried about the workforce being made redundant and the fallout over that they are delaying any decisions until they can find an otherwise busy news day to bury the problem by stopping support and close the works. What is the point of nationalising something so old and out of date!
Time the government stopped dithering and resolved the issue, but of course it has to be done at a time when it won’t reflect badly on anyone standing against Starmer in the leadership election.
June 18, 2026
Labour has long experience and a master’s degree in Bungling with distinction. They just don’t know what needs doing or how to do anything sensible.
Even at Council level they have produced recycling literature referring to items containing steel but spelt them as ‘steal’.
Tolerating a government that is incompetent and completely broken for another three years reflects on the electorate as being similarly daft. It’s as if we are suddenly bleeding to death but patiently wait our turn in the queue to be treated because the 800 people in front with athlete’s foot or blocked ears were sitting in front yesterday.
June 18, 2026
We can only await the ourcome of today’s election and then see who gets which role in any new Government. None of the possible candidates fill one with confidence but the thought of Milliband in No 11 should fill us all with dread.
June 18, 2026
I leave you to do the number juggling Sir JR, it’s not a field of expertise for me.
All I will say is, without nationalising the Scunthorpe plant. It will go. That’s it the end of steel making in Britain.
China will be happy as they will then supply all our steel.
Miliband will be happy, that’s another Co2 emitting factory he’s shut down.
He won’t mention the increased Co2 from making steel in China, then shipping it half way across the world.
June 18, 2026
A UK Parliament dealing in real figures/numbers/costs/expenditure is not what they do, they preen ego and ideology. When was the last time any UK Government had a ‘budget’ were money in and money out had some semblance of correlation. When was the last time the UK Parliament sort to ‘earn’ the wealth for the country to pay for their ideology?
This nationalisation has nothing to do with the safety & security of the Nation and its People – they are not allowed, they banned ‘real’ steel production in the UK, the UK Parliament, preferring to buy in from the worlds big polluters. Chose to ensure the UK is held hostage to the Worlds manipulators. We still desperately need the quality ‘steel’ the UK Parliament has banned! We still need steel for infrastructure and defence, the steel the UK Parliament has banned. These are not products expected to be produced at Scunthorpe, so what are they saving, what is the objective, what will be achieved? Saving Union Jobs? they could have saved Union Jobs, the jobs we need to preserve, if the UK Parliament hadn’t banned quality steel output from the UK.
This is a Parliament and its Government that will go down in history as the ones that accelerated World emissions exponentially, the Worlds greatest hypocrites. They just aided the destruction of not only the Nation and a World free of polluting emissions, all done by doing the opposite of their stated aims. They don’t think!
June 18, 2026
Why are all Labour senior members of Government listed as being friends of Israel but no other country – I repeat no other country – surely there is something very odd about all of this and we are only wasting time in trying to analyse steel nationalisation or anything else while this bizarre situation exists – could it be that the real UK government resides in some other far away place.
June 18, 2026
Just reading where eighty per cent of Tory sitting MP’s and Lords combined are members of the CFI Conservative Friends of Israel – it seems a bit much
June 18, 2026
But the Government does not want to have to do the sums; that would involve real work. They just want Parliament to sign a blank cheque.
June 18, 2026
I suspect the Government and its civil servants, having zero knowledge of running a business, are as hares in the headlights.
It’s clear Steel needs massive investment. By how much and where are questions remaining unanswered. Surely they grasp that the purpose of any business is to make a profit? With that in mind, they should be looking for potential customers for their product and a target price to offer them, either to beat the opposition or, if possible, to specialise their products to meet a market with fewer competitors. Having some idea of competitive prices, they should address the overheads. direct and indirect, to establish a cost for each product. Of course, in this country, the elephant in the room is energy costs, and when they make the difference between profits and losses, it is so plain what action is required. The question is, ‘are these neo-labourites clever enough to do it’? I fear not.
Whatever the outcome, I cannot see any private sector investment until the market can see a viable business up and running. So either there is a Private/Public ownership deal or full Nationalisation will be required IF it is found to be worth it.
June 18, 2026
18th June, happy ‘Battle of Waterloo’ day …..unless you’re French
June 18, 2026
A superb speech. Hopefully, you will send, or have sent, a copy to Kemi Badenoch and Nigel Farage. I wonder how many members of the HoL or MPs could deliver such a clear speech without notes. No point sending a copy to the PM or Miliband, as they are both in cloud cuckoo land.
What a strange government we have, bumbling along completely clueless about a situation which could/will cost the UK millions. There is a complete lack of drive, determination, energy and leadership. A competent PM would not tolerate such a sloppy approach to Steel, or any number of other things.
June 18, 2026
a long speech.Well rehearsed?incredible memory?off the cuff?.Either way are you certain that the peeraged
mob in the “sUpper” chamber and the other mob in the “sLower” chamber actually even give an,even,
inadvertent passage of wind for what you say?As for,possibly,the most boring blowhard contributor to your
site.Kindly will he get off his exalted pedestal and tell we mere mortals what is “an ordinary school”
June 18, 2026
Sounds like a review of an economics student’s exam paper before telling them they have failed and should either repeat the year or start again after changing subjects.
The remarkable thing about zealots for a cause is that they adhere to their ideology regardless of real world outcomes. We are used to socialists behaving this way – socialism’s eternal and ubiquitous failures are always the fault of others – but socialism combined with climate/green energy zealotry is a new and lethal combination to which we have yet to develop an effective counter. Pointing to reality does not affect these people at all: they are unique in the animal world, having no ability to learn and adapt. In the real world their species would die out by natural selection but having after progressed from the sixth form to cabinet minister without any contact with the real world and now safe in the rarefied atmosphere of Westminster, they survive.
Unfortunately, Lord Redwood, as excellent and rooted in reality as your speech was, it will have no impact on Starmer’s Gang, none at all.