Shapps to hold crunch talks with British Steel owner amid spectre of mass job cuts | Business News


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Grant Shapps, the new business secretary, will hold crunch talks next week with the owners of Britain’s second-biggest steel producer, amid dwindling hopes that a government aid package will prevent thousands of job losses.

Sky News has learnt that Mr Shapps will speak to Jingye Group executives on Monday in an attempt to persuade the Chinese company not to close one of the two blast furnaces at British Steel’s Scunthorpe base.

Insiders said this weekend that Jingye, which took control of an insolvent British Steel in 2020, had become increasingly pessimistic since Rishi Sunak became prime minister that the government will agree to the provision of substantial taxpayer funding.

One source said that British Steel had begun placing orders for equipment that would be required in order to permanently close one of Scunthorpe’s blast furnaces.

Such a move would entail as many as 2,000 redundancies at the company, the source added, in what would be a further blow to Britain’s industrial manufacturing capability.

Mr Sunak is expected to strike a more bearish tone towards requests for government money to prop up struggling companies than his short-lived predecessor in Downing Street, Liz Truss.

Jacob Rees-Mogg, who lasted just weeks as business secretary under Ms Truss, opened formal talks with Jingye last month about the provision of hundreds of millions of pounds of funding to help British Steel decarbonise.

One of the pre-conditions set by Whitehall for the talks was that Jingye would not cut jobs at British Steel while the discussions were ongoing.

Tata Steel, which is the biggest player in the UK steel sector, has also requested financial help from the government.

Image:
Efforts are being made to persuade the Chinese company not to close one of the two blast furnaces at Scunthorpe

Last month, a Whitehall insider told Sky News that talks were “underway with the steel sector, including…



Source : skynews


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