King's Speech 2026: Steel Industry (Nationalisation) Bill

Steel Industry (Nationalisation) Bill

● The UK steel industry is key to this country’s economic growth. It supports
around 37,000 direct jobs and over 60,000 in supply chains. But challenges of
global overcapacity compounded by high operating costs have made it harder
for UK-based steel companies to compete.

● Safeguarding the long-term future of Britain’s steel capability and capacity is
in our national interest. That requires us to take this urgent and extraordinary
action to introduce the Steel Industry (Nationalisation) Bill now. This legislation
provides a route for the Government to nationalise steel companies or their
operations, such as British Steel, provided the public interest test in the
legislation is met.

What does the Bill do?

● The Government has set out a Steel Strategy - a long-term plan to fight to
revitalise the UK steel sector, restore domestic production to sustainable
levels and secure the industry’s role in supporting critical sectors such as
national infrastructure, defence, clean energy and supporting the economy of
the UK.

● The Government intervened in April 2025 by introducing the Steel Industry
(Special Measures) Act 2025 to avoid a sudden and disorderly halt of steel
making at British Steel Ltd. (BSL), following actions by BSL’s owner which put
steelmaking at the company in serious jeopardy. This would have been
unacceptable given the importance of this plant for the UK economy and
critical national infrastructure.

● The Government wants to see BSL play a major role in a revitalised steel
sector, but this will not be possible under its current ownership. Bringing BSL
under national ownership would allow the Government to explore what future
opportunities there may be for BSL, including a transition to decarbonised
steelmaking and to provide stability for BSL’s workers, suppliers and
customers.

● The Government has engaged in negotiations with the current owner of BSL
on a commercial sale, but it has not been possible to agree acceptable terms
which would represent a responsible use of public money. As a result, the

10
 Government believes it is in the public interest to bring forward primary
legislation which will give the Government the powers to nationalise BSL. This
is a measure of last resort. Any nationalisation of BSL would be subject to the
public interest test being met before using the powers under the Bill.

● The Bill will:
Safeguard the future of the UK steel industry by providing the Secretary
of State powers to transfer ownership of steel undertakings (either by a
share or property transfer) to public ownership.

○ The Government has been clear in its objective to revitalise the UK
steel sector, restore domestic production to sustainable levels
and secure the industry’s role in supporting critical sectors
and supporting the economy of the UK.

○ The powers in the Bill will allow the Government to do this by taking
steel undertakings into public ownership where it is in the public
interest to do so.
Establish a public interest test that must be met for the Government to
exercise transfer powers in respect of a steel undertaking.
○ An indicative list of public interest factors is provided in the Bill which
includes national security, support for the economy and critical national
infrastructure.

○ This Government is committed to ensuring that the UK remains an
attractive place to invest and do business, and we would not use these
powers lightly.

○ The public interest test provides a key safeguard and framework for the
use of the powers by the Government.
Introduce compensation provisions for steel undertakings in respect of
which SoS’s transfer powers have been used.
○ Where the Government does exercise the transfer powers in the Bill,
regulations would follow to set out a compensation scheme.

○ This would allow those affected to obtain independently assessed
compensation.

○ The valuer will look at circumstances and determine what
compensation, if any, is required.

11
Territorial extent and application

● The Bill will extend and apply to the whole of the UK.

Key facts

● Global competition, high costs and underinvestment in the steel sector
have led to plant closures and job losses – the UK steel industry supports
37,000 direct jobs and a further 60,000 in the supply chain, however
employment in the industry was at 323,000 in 1971, a decline of nearly 90 per
cent.

● Steel output has fallen sharply in recent years. UK production has dropped
below 4 million tonnes in 2024 – the lowest in decades.

● The UK now produces less than 0.3 per cent of global steel. It is a net
importer, with imports covering about 60 per cent of demand.

● The steel sector underpins other critical sectors such as construction,
defence, and clean energy – the UK steel industry contributed £1.7 billion to
the economy in 2024.

● Excess steel from subsidies produced in world markets drives down
prices and makes it harder for UK firms to compete and invest.

● The sector is transitioning to greener production. The Government has
committed up to £2.5 billion to support modernisation and decarbonisation.

● Director General of UK Steel, Gareth Stace, said “We strongly welcome the
prime minister’s announcement to legislate for the nationalisation of British
Steel. This provides vital certainty for the workforce, the company’s customers
and the wider supply chain at a critical moment. Steel is a foundation industry
and a recognised strategic national asset. Maintaining domestic production
capability for British Steel’s products is essential not only for economic growth
but also for our national security and resilience.”

12