The British government recalled Parliament last week to discuss the Steel Industry (Special Measures) Bill, which has been approved by both Houses. The government's emergency action is aimed at keeping the Scunthorpe blast furnace operational.

The British government had made a 500 million pound offer in late March, but it was rejected by British Steel's parent company Jingye Group, which was unwilling to buy enough raw materials to keep the blast furnaces running.

The British government has offered to buy raw materials to keep the blast furnaces running. However, Jingye made a counter-offer:  transferring hundreds of millions of pounds to it without any conditions, preventing the money and other potential assets from being immediately transferred to China. Jingye was said to have always intended to retain the downstream mills and supply them from China rather than Scunthorpe.

The issue of transferring ownership to the state remains unresolved. Judging from the company's behavior, this is most likely one of the options at this stage. The UK Government’s expectation for British Steel remains that a co-investment agreement be reached with a private sector partner to ensure a long-term transformation, rather than the Government providing funding for British Steel’s long-term transformation.