Calls by unions and industry groups for the UK government to intervene in the struggling Scottish steel mill Liberty Steel Dalzell have been met with resistance from ministers concerned about the financial implications of nationalisation, according to sources familiar with the matter.
Liberty Steel Dalzell, located in Motherwell, Scotland, is part of the Gupta Family Group Alliance and produces steel plate used in Royal Navy warships. The facility employs just over 100 workers but has remained idle for several months. Additionally, the company has not submitted financial accounts to Companies House for the past six years.
Trade unions and industry representatives have urged the government to assume control of the Dalzell site and integrate it with other steel assets, including British Steel and Liberty Speciality Steel. British Steel, formerly owned by the Chinese firm Jingye, was brought into public ownership in July, while Liberty Speciality Steel was placed under government control in a separate move last month.
Alasdair McDiarmid, assistant general secretary of the union Community, which represents employees at Dalzell, emphasized the potential benefits of uniting the three businesses. He noted that such consolidation could strengthen the domestic supply chain for defence and offshore wind projects. British Steel produces the raw steel slabs that could be processed into metal plates at Dalzell, enhancing operational efficiency.
Gareth Stace, director-general of UK Steel, described the situation as a “once-in-a-generation opportunity” to maximise synergies between the companies.
Despite recognition of the strategic importance of the Dalzell mill, government officials have expressed reservations about the financial costs involved. One individual close to the discussions acknowledged that while multiple parties advocate for government takeover, the critical question remains whether funding is available to support such a move.
The government issued a statement affirming its awareness of the site’s significance to workers, the local community, and national capability, but stressed that responsibility for Dalzell continues to rest with its private owner, Liberty Steel. The company declined to comment on the matter.
Unlike Liberty Speciality Steel, which entered administration before government intervention, Dalzell remains under private ownership. A recent report by the Public Accounts Committee highlighted that British Steel has already cost taxpayers £555 million and continues to operate at a loss of approximately £1.3 million per day, with MPs critiquing the absence of a clear plan for the business’s long-term sustainability.
The Gupta Group built its steel empire by acquiring undervalued metals companies across the UK and abroad, but has faced severe financial difficulties since Greensill Capital, its principal lender, collapsed in 2021. This triggered plant closures, significant job losses, and efforts to restructure more than $5 billion in debt. Furthermore, Sanjeev Gupta is currently subject to legal proceedings from Companies House for failure to file accounts, and the Serious Fraud Office is investigating his business affairs.