Liberty Steel and the Future of the UK Steel Industry
Business and Trade Committee
Closed
Inquiry
The BEIS Committee is holding an inquiry into Liberty Steel and the Future of the UK Steel Industry. On 8 March 2021, the supply chain finance firm Greensill Capital collapsed into administration after months of speculation about its financial viability. Greensill was the principal financial backer of GFG Alliance, owner …
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23
Recommendations
19
Conclusions
1
Report
5
Oral sessions
23
Letters
5
Events
Activity timeline 30 events
20 Jan
2022
2022
5 Nov
2021
2021
2 Nov
2021
2021
2 Nov
2021
2021
2 Nov
2021
2021
2 Nov
2021
2021
2 Nov
2021
2021
2 Nov
2021
2021
22 Jul
2021
2021
22 Jul
2021
2021
20 Jul
2021
2021
19 Jul
2021
2021
Oral evidence sessions 5 sessions
20 Jul 2021
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Liberty Steel and the Future of the UK Steel Industry; Decarbonising heat in homes
Charlotte Baker · Ministry of Housing, Communities and Local Government
Rt Hon Christopher Pincher MP · Ministry of Housing, Communities and Local Government
Rt Hon Kwasi Kwarteng · Department for Business, Energy and Industrial Strategy
6 Jul 2021
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Oral evidence
Cynthia O'Murchu · Financial Times
Dr Javed Siddiqui · Alliance Manchester Business School, The University of Manchester
S. Alex Yang · London Business School
29 Jun 2021
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Oral evidence session
Milan Patel · King & King Chartered Accountants
Patrick Magee · British Business Bank
Stephen Rose · Wyelands Bank
22 Jun 2021
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Liberty Steel and the Future of the UK Steel Industry
Anton Krull · Liberty Steel UK
Henrik Adam · Tata Steel Europe
Jon Bolton · GFG Global Advisory Board
25 May 2021
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Oral evidence session
Chris McDonald · Materials Processing Institute
Edwin Basson · World Steel Association
Gareth Stace · UK Steel
Roy Rickhuss · Community Trade Union
Roz Bulleid · Green Alliance
Rt Hon Kwasi Kwarteng · Department for Business, Energy and Industrial Strategy
Reports 1 report · click to expand
| Title | HC No. | Published | Items | Response |
|---|---|---|---|---|
| Fourth Report - Liberty Steel and the future of the UK steel Ind… | HC 821 | 5 Nov 2021 | 42 | Responded |
Recommendations & Conclusions
14 results
1
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
The corporate structure and governance of GFG Alliance companies resulted in no formal oversight or...
The corporate structure and governance of GFG Alliance companies resulted in no formal oversight or accountability of the decisions taken by Sanjeev Gupta. Mr Gupta put members of his staff in an unacceptable position by employing them with job titles …
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Government Response
The government agrees that complex corporate structures should not be a legal barrier to proper scrutiny of companies like the GFG Alliance, while noting it does not wish to restrict business structuring.
Department for Business and Trade
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2
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
We recommend that Ministers reflect on the systemic risks to UK industry posed by such...
We recommend that Ministers reflect on the systemic risks to UK industry posed by such unusual corporate structures and, if deemed necessary, bring forward amendments to the Companies Act. (Paragraph 29) Audit
Government Response
The government acknowledges that complex corporate structures should not hinder scrutiny but states it does not wish to restrict the ability of businesses to structure themselves, without committing to bringing forward amendments to the Companies Act.
Department for Business and Trade
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3
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
We were not reassured by the evidence presented by King & King and note the...
We were not reassured by the evidence presented by King & King and note the legal restrictions placed upon Mr Patel, and other auditors who had previously audited GFG Alliance companies, by Sanjeev Gupta.
Government Response
The government acknowledges that complex corporate structures should not be a legal barrier to scrutiny but expresses a desire not to restrict business structuring, without committing to specific actions.
Department for Business and Trade
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10
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
We note the recent developments within GFG Alliance and Liberty Steel UK and welcome the...
We note the recent developments within GFG Alliance and Liberty Steel UK and welcome the injection of capital at Liberty Steel’s Rotherham plant. However, we note that once again Sanjeev Gupta has decided to set up an additional corporate entity …
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Government Response
The government, via BEIS and the FRC, acknowledged the public interest in the issues of opaque funding at Liberty Steel, outlining the FRC's investigative remit and procedures for handling such cases, noting the specific entities are not usually within FRC's scope but can be reclaimed.
Department for Business and Trade
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17
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
We did not receive evidence that the use of circular trading between companies is a...
We did not receive evidence that the use of circular trading between companies is a systemic issue, but note the potential criminal liability associated with the worst examples of financial engineering between businesses. Despite repeated reassurances from GFG Alliance, we …
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Government Response
The government notes that the International Accounting Standards Board has proposed amendments to reporting supply chain finance, which the UK Endorsement Board and Financial Reporting Council will consider for adoption. The government also states it will continue to closely monitor Liberty Steel UK's restructuring and refinancing efforts.
Department for Business and Trade
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18
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
We note that concerns were raised by HM Treasury and shared with BEIS about GFG...
We note that concerns were raised by HM Treasury and shared with BEIS about GFG Alliance and Wyelands Bank during the accreditation process of Greensill Capital to the CLBIL scheme.
Government Response
The government welcomes the Committee's acknowledgment that BEIS acted properly and the British Business Bank operated independently, implicitly addressing the noted concerns about GFG Alliance and Wyelands Bank.
Department for Business and Trade
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19
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
We recognise that the subsequent level of interest from the BEIS Department about the accreditation...
We recognise that the subsequent level of interest from the BEIS Department about the accreditation of Greensill Capital was “unusual” but we are confident that this did not impact the approval process and the British Business Bank’s decision remained independent. …
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Government Response
The government welcomes the Committee’s acknowledgment that BEIS acted properly and that the British Business Bank operated independently in the Greensill Capital accreditation process.
Department for Business and Trade
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34
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
There is a clear lack of direction with respect to the future of the nation’s...
There is a clear lack of direction with respect to the future of the nation’s blast furnaces both within the Government and in industry. A range of options exist for the decarbonisation of primary steelmaking, including carbon capture and storage …
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Government Response
The government acknowledges the sector's decarbonisation plans, stating that the optimal route is a commercial decision for individual companies, and points to existing support mechanisms in the Net Zero Strategy.
Department for Business and Trade
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35
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
We found broad agreement that the UK should retain a primary steelmaking capacity rather than...
We found broad agreement that the UK should retain a primary steelmaking capacity rather than push its emissions and business abroad, a point recognised in the Government’s own Industrial Decarbonisation Strategy. However, if the Government is serious about its emissions …
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Government Response
The government states it is working with the steel sector to understand decarbonisation plans and highlights existing support through the Net Zero Strategy. It emphasizes that the optimal decarbonisation route is a commercial decision for companies, without committing to new specific actions to provide immediate certainty or direction.
Department for Business and Trade
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36
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
We identified enthusiasm from many witnesses for the use of hydrogen direct reduced iron as...
We identified enthusiasm from many witnesses for the use of hydrogen direct reduced iron as a technology well-suited to decarbonising the UK steel industry. However, as with other potential solutions, it is a technology that remains untested at scale. A …
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Government Response
The government states it is working with the sector to understand decarbonisation investment plans, noting that the optimal route is a commercial decision for companies, and points to existing support in the Net Zero Strategy for which the steel sector can bid, without committing to a specific hydrogen pilot.
Department for Business and Trade
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39
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
Many of the challenges facing the UK steel industry today are long-running and have led...
Many of the challenges facing the UK steel industry today are long-running and have led to crises in the past. Without fundamental reform of energy pricing and a clear decarbonisation strategy, the sector will fail to attract much needed investment …
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Government Response
The government acknowledged the pressures faced by businesses due to rising energy prices and stated that extensive engagement with industry continues, but did not commit to fundamental reform of energy pricing or a clear decarbonisation strategy.
Department for Business and Trade
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40
Conclusion
Acknowledged
Fourth Report - Liberty Steel and …
A successful transition to net zero will be dependent on addressing the wider challenges and...
A successful transition to net zero will be dependent on addressing the wider challenges and opportunities facing the UK steel industry. These issues will need to be tackled as part of a broader, strategic approach to decarbonisation.
Government Response
The government acknowledged pressures from energy prices and noted ongoing engagement with industry but did not specifically commit to a broader, strategic approach to decarbonisation for the steel industry as suggested.
Department for Business and Trade
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41
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
The steel industry has faced a number of crises in recent years but action to...
The steel industry has faced a number of crises in recent years but action to support the sector has been taken on a mostly ad hoc, reactive basis. The sector cannot continue to lurch from crisis to crisis and action …
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Government Response
The government recognises the pressures on businesses due to energy prices and states that extensive engagement with industry is continuing across government.
Department for Business and Trade
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42
Recommendation
Acknowledged
Fourth Report - Liberty Steel and …
We call on Ministers to establish a new Sector Deal for the steel industry.
We call on Ministers to establish a new Sector Deal for the steel industry. The Sector Deal should address long-running challenges to the sector’s competitiveness as part of a cohesive plan for decarbonising the industry. It should set out a …
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Government Response
The government recognizes the pressures on businesses and ongoing engagement with the industry but does not commit to establishing a new Sector Deal for the steel industry or providing a decarbonisation roadmap as recommended.
Department for Business and Trade
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Government Response AI assessment · 42 of 23 classified
Acknowledged
14
Deferred
4
Total
23 recs + 19 conclusions
Correspondence 23 letters
2 Nov 2021
To committee
Letter from the Secretary of State on Liberty Steel and the UK steel industry
Parliament page
2 Nov 2021
To committee
Letter from the Secretary of State on evidence given on Liberty Steel and the future of the UK Steel Industry inquiry
Parliament page
2 Nov 2021
To committee
Letter from the Secretary of State on the possibility of a deal for the UK steel sector
Parliament page
2 Nov 2021
To committee
Letter from GFG Alliance in response to BEIS Committee written questions
Parliament page
2 Nov 2021
Email to the Chair from Lex Greensill relating to Greensill Capital, received 21 July
Parliament page
2 Nov 2021
To committee
Letter from Grant Thornton UK LLP relating to Greensill Capital
Parliament page
22 Jul 2021
To committee
Letter from the British Business Bank on Greensill Capital's application for accreditation under the Coronavirus Large Business Interruption Scheme (CLBILS)
Parliament page
22 Jul 2021
To committee
Letter from Grant Thornton UK LLP responding to questions on the financial arrangements of GFG Alliance companies
Parliament page
19 Jul 2021
To committee
Letter from the Chair to Grant Thornton UK LLP regarding Greensill Capital
Parliament page
14 Jul 2021
Email to the Chair from Lex Greensill relating to Greensill Capital
Parliament page
14 Jul 2021
To committee
Letter from the Chair to Sanjeev Gupta on GFG Alliance and Liberty Steel
Parliament page
13 Jul 2021
To committee
Letter from the British Business Bank on CLBILS and Greensill Capital
Parliament page
13 Jul 2021
From committee
Letter to Grant Thornton UK LLP on Simec Lochaber Hydropower 2
Parliament page
13 Jul 2021
To committee
Letter from the Secretary of State and the Secretary of State for International Trade relating to the UK steel industry
Parliament page
8 Jul 2021
To committee
Letter from GFG Alliance declining the invitation to give oral evidence to the Committee’s Liberty Steel and the Future of the UK Steel Industry inquiry
Parliament page
8 Jul 2021
To committee
Letter from the Secretary of state for International Trade and the Secretary of State for BEIS relating to the Trade Remedies Investigations Directorate and UK steel safeguards
Parliament page
8 Jul 2021
To committee
Letter from the Chair of the British Business Bank relating to Greensill Capital
Parliament page
8 Jul 2021
To committee
Letter from the former CEO of the British Business Bank relating to Greensill Capital
Parliament page
8 Jul 2021
To committee
Letter from Grant Thornton UK LLP relating to Simec Lochaber Hydropower 2
Parliament page
30 Jun 2021
To committee
Response from Mr Lex Greensill in answer to the Chair's letters of 7 and 16 June in relation to the Liberty Steel and UK steel industry inquiry
Parliament page
30 Jun 2021
To committee
Letter from the Chair to Lex Greensill regarding questions relating to the Committee's inquiry on Liberty Steel and the future of the UK steel industry
Parliament page
16 Jun 2021
To committee
Letter from Chair to Mr Lex Greensill relating to request to give evidence to the Committee
Parliament page
28 May 2021
To committee
Letter from the Chair to the Secretaries of State for Business, Energy and Industrial Strategy and for International Trade relating to recommendations from the Trade Remedies Investigation Directorate
Parliament page