Thousands of British manufacturing jobs have been secured today (17 June 2025) following a visit by the Transport Secretary to Scunthorpe, where a significant rail steel deal between Network Rail and British Steel was finalised.
The £500 million, five-year contract will see British Steel supply over 337,000 tonnes of rail track, providing crucial stability for the company just two months after the government’s emergency intervention saved the Scunthorpe plant from closure.
Visiting the historic steelworks today, Transport Secretary Heidi Alexander announced the details of this landmark agreement. This deal represents the first major public procurement since the government’s unprecedented action in April 2025, which saw the Prime Minister request the recall of Parliament to pass emergency legislation. This swift intervention prevented the immediate shutdown of Scunthorpe’s blast furnaces, safeguarding vital British manufacturing jobs.
That decisive action followed British Steel’s owners, Jingye Group, announcing plans to cease the site’s blast furnaces and other key steelmaking operations, despite months of negotiations and a £500 million co-investment offer from the government.
This positive development also complements the recent announcement of a new trade deal between the UK and US. Once implemented, this deal is expected to lower tariffs and protect thousands of jobs across key sectors, including steel, making the UK the first and currently only country to have secured such an agreement.
The rail deal underscores progress in the government’s wider industrial strategy, which aims to strengthen domestic manufacturing and supply chains as part of its “Plan for Change” commitment to drive economic growth across all regions of the UK.
Transport Secretary, Heidi Alexander, said: “This landmark contract truly transforms the outlook for British Steel and its dedicated workforce in Scunthorpe, building on its decades-long partnership with Network Rail to produce rail for Britain’s railways.”
She added: “After taking urgent action to step in and save these historic blast furnaces from closure, we’ve now helped secure their long-term future by backing British Steel with meaningful government contracts, protecting thousands of skilled manufacturing jobs in the process. This crucial investment in our railway infrastructure shows we are delivering on our Plan for Change commitment to raise living standards in every part of the UK and ensure economic growth is felt by working people in our proud industrial heartlands.”
Business Secretary, Jonathan Reynolds, commented: “This is great news for British Steel and a vote of confidence in the UK’s expertise in steelmaking, which will support thousands of skilled jobs for years to come. Following our decisive action to step in and save steelmaking at Scunthorpe in April, this contract will give the sector the security to supply the steel we need for the infrastructure of the future, as part of our Plan for Change.”
The new Network Rail contract, valued at an estimated £500 million, will commence on 1 July. It will see British Steel supplying 80% of Network Rail’s rail needs and builds on the government’s £2.5 billion steel fund, established to revitalise UK steel production over the next five years.
This contract forms part of Network Rail’s broader rail supply agreements for nearly 450,000 tonnes of rail over the next five years. To ensure security of supply, Network Rail is also set to award smaller contracts to some European manufacturers for specialist rail products, complementing British Steel’s provision.
Specifically, the contracts will ensure:
- British Steel supplies a minimum of 337,000 tonnes of long and short rail.
- A further 80,000 to 90,000 tonnes will be provided by other European manufacturers, with those deals expected to be announced shortly.
This strategic partnership builds on decades of collaboration between Network Rail and British Steel, whose Scunthorpe plant has been producing rail for Britain’s railways since 1865.
Clive Berrington, Network Rail’s Group Director for Railway Business Services, said: “British Steel remains extremely competitive in the provision of rail and we are delighted that they will remain our main supplier in the years ahead.”
Craig Harvey, British Steel’s Commercial Director for Rail, stated: “We are exceptionally proud to be extending our long-term strategic partnership with Network Rail with an agreement demonstrating British Steel’s importance to the UK’s economy and infrastructure. The contract is a ringing endorsement of UK workers and British industry, underpinning the vital role we play in ensuring millions of passengers and freight operators enjoy safe, enjoyable, and timely journeys on Britain’s railways.”
Image credit: Network Rail
