Westminster’s Easter recess was unexpectedly interrupted as Parliament was recalled on a Saturday for the first time since the Falklands War, as MPs and Peers passed emergency legislation to prevent the closure of the British Steel plant in Scunthorpe.
Intensive talks last week with the plant’s Chinese owner Jingye had failed to secure its future. This risked the UK becoming the only G7 country without the capacity to produce virgin steel, a troubling prospect amid growing concerns over economic and national security.
In a move which attracted widespread cross-party support – albeit with the expected political point scoring during the debates - MPs and Lords voted for the new law which gives the Business Secretary Jonathan Reynolds powers to keep the plant running. The move stops just short of full nationalisation and the government is hopeful they can confirm private investment to save the plant. Officials continue to work at pace to deliver essential raw materials to keep the blast furnaces burning.
These developments have reignited debates over UK-China relations and foreign involvement in the UK’s critical infrastructure. Recent high-profile visits from Ministers Ed Miliband and Douglas Alexander, and the Head of the British military Tony Radakin, reflect the growing rapprochement between the UK and China since the election. However, UK-China relations remain complex, and critics point to British Steel as evidence that the government’s approach towards China is laden with contradictions.
Tensions escalated further when Liberal Democrat MP Vera Hobhouse was denied entry to Hong Kong while visiting her newborn grandson. Reports also suggest Ministers are considering placing certain Chinese state-linked entities on the enhanced tier of the foreign influence registration scheme. All eyes are now on the upcoming cross-Whitehall review of UK-China relations which has become more critical than ever.
The government’s urgency in taking control of British Steel and its focus on national resilience and economic sovereignty is inextricably linked to broader global instability and President Trump’s tariff agenda. In a climbdown last week, Trump announced a 90-day pause on a range of planned global tariffs which has somewhat calmed global markets, for now…
Most countries, including the UK, now face a uniform 10% tariff on goods entering the United States. The government will welcome this temporary tariff pause, but it will be disappointed that it can no longer point to the UK’s preferential position. Comments from Kevin Hassett, a senior economic adviser to Trump, that the UK would need an “extraordinary” deal to go below this 10% tariff, will have added to the government’s political headaches.
The imposition of 145% tariffs on Chinese goods has also stoked fears of a prolonged trade war between the world’s two economic superpowers, although the announcement of exemptions for smartphones and computers from tariffs will soften the blow slightly.
Still, there was a glimmer of good economic news at home. The ONS reported a 0.5% GDP rise in February, with growth across all major sectors. However, economists warned that this positivity may not last for long, as the impact of the recent employers' National Insurance rises and President Trump’s tariffs begin to bite.
Defence also remains high on the government’s agenda. Last week, the UK and Germany co-chaired the 27th Ukraine Defence Contact Group meeting at NATO headquarters in Brussels, with the UK pledging £450 million more in military aid. Talks on a new EU-UK defence pact are ongoing, which could open the door to UK involvement in contracts funded by the EU’s €150bn defence loans scheme.
Meanwhile, Rishi Sunak’s resignation honours list reignited criticism over cronyism. Former Conservative ministers, including Michael Gove, Jeremy Hunt, and James Cleverly, were handed peerages and knighthoods, fuelling renewed calls for reform of the honours system.
Political scandals also continue to trouble the government. In an ongoing saga, Bangladesh announced it had issued an arrest warrant for Labour MP and former City minister Tulip Siddiq. Meanwhile, the Rail Minister Lord Peter Hendy admitted using his mobile phone while driving a vintage double-decker bus.
Whilst geopolitics has been dominating the headlines of late, political parties are gearing up for a crucial test with less than three weeks to go until the May local elections. Speculation is also mounting over a possible summer reshuffle, with reports that Energy Secretary Ed Miliband expects to lose his job.
Whilst Parliament is now back in recess for a few weeks – pending another emergency – many may be hoping for a period of relative calm, but recent events have shown that British politics rarely stands still.
Consultations
- A railway fit for Britain's future - Closes 15th April
- Improving the way Ofsted inspects education - Closes 28th April
- Building the North Sea’s energy future - Closes 30th April
Statistics
- UK labour market: April 2025 - Published 15th April
- Consumer price inflation, UK: March 2025 - Published 16th April
- Online Experiences Tracker - Published 16th April