Government intervention keeps UK’s last primary steelmaking furnaces running

THE UK GOVERNMENT spent £377 million to prevent the closure of the country’s last remaining blast furnaces at British Steel’s Scunthorpe plant, according to a new report.

The emergency intervention came less than a year after the shutdown of the final coal-fired blast furnace at Port Talbot, which ended more than a century of primary steelmaking at the UK’s largest steelworks.

A report by the National Audit Office (NAO) said the Department for Business and Trade (DBT) stepped in quickly in 2025 to keep the Scunthorpe furnaces operating, warning that their closure would have led to thousands of job losses and major disruption to critical UK supply chains.

The £377 million spent between April 2025 and January 2026 has been classified as a loan, but the NAO warned that total costs could exceed £1.5 billion by 2028 if current spending levels continue.

Operating the furnaces is currently costing around £1.3 million a day, the report said, with no fixed budget, repayment schedule or clear end date for the government support.

British Steel’s owner Jingye had been in talks with the Government between 2022 and 2025 about switching the plant to electric arc furnaces, but no agreement was reached.

In March 2025 the company said it was losing around £700,000 a day due to difficult market conditions, tariffs and environmental costs and warned that it was considering closing the blast furnaces.

The Government feared the closure would leave the UK without the ability to produce virgin steel from raw materials — a capability considered strategically important for defence, infrastructure and rail manufacturing.

Electric arc furnaces, which melt scrap steel using electricity rather than iron ore and coal, are seen as the future of the industry because they produce far fewer carbon emissions. However, they cannot fully replace blast furnaces for certain specialist steel products.

The closure of Port Talbot’s blast furnaces last year marked the end of traditional steelmaking in Wales and triggered widespread concern about the long-term future of the UK steel industry.

At its peak, the Port Talbot plant employed thousands of workers and was capable of producing around five million tonnes of steel a year.

Trade unions and industry groups warned that without intervention at Scunthorpe, Britain risked becoming the only G7 nation unable to produce primary steel.

The NAO said the Government’s decision to intervene reflected the “strategic importance” of maintaining domestic steelmaking capacity, but warned that long-term plans for the sector remain uncertain.

Industry figures and unions reacted quickly to the report, warning that the future of UK steel remains uncertain.

Gareth Davies, head of the National Audit Office, said the Government had acted quickly to prevent serious economic damage.

He said the intervention avoided heavy job losses and disruption to major UK infrastructure and construction projects but warned that the high cost of keeping the furnaces running created “significant uncertainty” about how long support could continue.

Trade unions also backed the decision to intervene.

Alasdair McDiarmid of the steelworkers’ union Community said allowing the plant to close would have had devastating consequences.

He said the Government had taken the right decision to act, warning that local economies would have been “decimated” and that Britain would have lost its ability to produce steel from raw materials.

The intervention has also reignited political debate in Wales, where critics have questioned why similar emergency action was not taken sooner to save the blast furnaces at Port Talbot.

The shutdown of the Welsh plant resulted in around 2,800 direct job losses, with thousands more roles across the wider supply chain affected.

Opposition politicians and industry figures have argued that the contrast between the Government’s approach to Scunthorpe and the earlier closure in South Wales highlights the lack of a clear long-term strategy for the UK steel industry.

Ministers say a wider steel strategy is now being developed to balance the transition to greener electric arc furnace technology with the need to maintain domestic steelmaking capacity.

Five community initiatives receive support through Sustainable Development Fund

FIVE community-led projects across Pembrokeshire have secured funding from the Pembrokeshire Coast National Park Authority (PCNPA) following a competitive round of the Sustainable Development Fund (SDF).

The authority’s Grants Committee met in late January to consider fifteen applications from across the county. Members said the quality of submissions was exceptionally high, making the selection process particularly challenging.

Projects were assessed on how well they supported the aims of the SDF, which promotes sustainable development, community resilience and environmental improvement within the National Park.

The five successful applicants were:

Transition Bro Gwaun
Yr Hen Ysgol, Dinas
The Wildlife Trust of South and West Wales (Skokholm Island)
Angle Village Hall
St Davids City Council

The successful bids include plans to install renewable energy systems in community buildings and carry out energy-efficiency retrofit improvements to local hubs used by residents.

Bethan Jones, Sustainability Officer at the Park Authority said: “It was encouraging to see such ambitious ideas emerging from our local communities. These projects offer innovative solutions that will deliver a lasting, positive impact across communities in the National Park.”

Work on the funded projects has already begun following confirmation of the grants.

Details of the next round of Sustainable Development Fund funding will be announced once future budgets have been confirmed. Updates will be shared through Pembrokeshire Association of Voluntary Services (PAVS) and other local community networks.

Further information about the Sustainable Development Fund is available at www.pembrokeshirecoast.wales/sdf.

Caption:

Yr Hen Ysgol Dinas Community Centre has benefited from the latest round of funding from the Sustainable Development Fund. (Pic: PCNPA)

PEMBROKESHIRE’S two Members of the Senedd have written jointly to the Welsh Government’s Counsel General seeking legal advice on possible ways to challenge decisions made by Hywel Dda University Health Board affecting healthcare services in the county.

Paul Davies MS and Samuel Kurtz MS have asked the Counsel General, Julie James MS, to outline what legal mechanisms may exist to scrutinise or challenge the health board’s decision-making process, particularly in relation to changes impacting services at Withybush Hospital.

Their move comes amid growing concern from residents, clinicians and community groups about the impact of service changes on patient safety and access to care, especially in a rural county where travel times to alternative hospitals can be significant.

Public concern has also been reflected in a petition calling for intervention over the future of services at Withybush Hospital. The petition has now attracted more than 11,000 signatures and continues to gain support.

Having passed the required threshold, the petition can now be considered for debate in Senedd Cymru.

The two MSs say the level of public backing highlights the strength of feeling locally and the need for greater scrutiny of decisions being taken about healthcare provision.

Paul Davies MS said: “Residents across Pembrokeshire are deeply concerned about the cumulative impact that changes to healthcare services could have on patient safety and access to care in a rural area. The fact that more than 11,000 people have signed the petition highlights just how strongly people feel about this issue.”

Samuel Kurtz MS added: “People deserve confidence that decisions affecting vital healthcare services have been taken properly and with full consideration of the impact on local communities. We have therefore written to the Counsel General to seek advice on what legal avenues may exist to challenge these decisions and what powers the Welsh Government has to intervene where serious concerns have been raised.”

The MSs have also asked the Welsh Government to clarify what role it can play in reviewing or intervening where there are significant concerns about the governance and decision-making processes of a health board.