Keeping British Steel operational costs £1.3 million a day, — regulator

Over a nine-month period (from April 12, 2025, to January 31, 2026), the British government spent £377 million ($499 million) to keep British Steel’s Scunthorpe plant operational, according to the BBC.

Last April, the government took control of British Steel to prevent the closure of the last two blast furnaces in the UK.

The National Audit Office (NAO) reported that the company’s current operations cost the Department for Business and Trade approximately £1.3 million per day.

The report by the NAO — an independent body that monitors UK government spending—notes that over the period, £15 million was spent on consultants, £359 million on the company’s operational activities (raw materials, wages, etc.), and £3 million on legal and other expenses for the plant in North Lincolnshire.

The costs were classified as a loan, but without a defined budget, repayment schedule, or end date.

The agency expects that by June of this year, the costs will reach £615 million (nearly $815 million). If they continue at the current rate, they could exceed £1.5 billion (about $2 billion) by 2028.

Before the government intervened, the previous owner — the Chinese company Jingye — and the Department for Business and Trade had been negotiating a transition to electric arc furnaces between 2022 and 2025, but failed to reach an agreement. Last March, Jingye announced that it was losing £700,000 a day due to challenging market conditions, tariffs, and high environmental costs, and was considering shutting down its blast furnaces.

The regulator’s report states that this would result in significant job losses at the Scunthorpe plant and impact customers throughout the supply chain.

“Last year, we protected thousands of jobs by saving British Steel from collapse, and we intend to support British steel production now and for future generations,” a government spokesperson noted.

According to the spokesperson, Parliament is briefed every four weeks on the state of affairs, including costs. In addition, negotiations with Jingye are continuing to find a pragmatic solution.

As a reminder, last November it was reported that the British government hopes to find a private buyer for British Steel and is seeking to involve bankers in the sale process. It was expected that any potential investor in British Steel would require substantial government subsidies.