UK spending watchdog warns over cost of funding British Steel

LONDON, March 16 (Reuters) - Britain has spent 377 million ​pounds ($500 million) ⁠funding British Steel for nine months, ​the country's spending watchdog said, adding there was no certainty about the duration of support ​and ‌whether it would be repaid.

In April 2025, the government seized operational control of British Steel ⁠from its Chinese owners, Jingye, to save the country's ⁠last remaining primary steelmaking capability ​and thousands of jobs.

The National Audit Office said on Monday the cost of the intervention was set to rise to over half a billion pounds by June and ​savings ‌would need to be made elsewhere to fund ongoing support.

• Britain's Department for Business and Trade (DBT) spent 377 million pounds between April 12 and January 31, with no budget set at the 2025 Spending Review and no end ​date for the invention, the NAO found.

• Ongoing operations are costing the government ‌around 1.3 million pounds per day and the bill for support is set to reach 615 million pounds by June.

• ‌DBT has classified the support as a loan but there is no set budget or repayment schedule, with the NAO warning that it is not apparent ​that British Steel will be able to repay it.

• NAO said while the support saved ‌jobs and helped UK infrastructure and construction projects, "the trade-off is the significant cost of maintaining operations, and uncertainty over how long this will continue. DBT should learn from ⁠this experience ⁠to be better prepared for future interventions."

• A ‌government spokesperson said: "Last year we protected thousands of jobs by saving British Steel from collapse, and we are ​determined to ​support British steelmaking now and for generations to come.

• "We update ‌parliament on British Steel every four weeks, including spending, and we continue discussions with Jingye to find a pragmatic, realistic solution for its long-term future." ($1 = 0.7545 pounds) (Reporting by Sarah Young, Editing by Paul Sandle)