A report in the UK Financial Times today claims that the British Government has drawn up contingency plans to run Liberty Steel using public money should the business collapse.

According to the newspaper, Downing Street is desperate to find new financing after the failure of Greensill Capital, the steelmaker's main lender.

Options under consideration include using public money to run the company, the UK's third biggest steelmaker and an employer of 5,000 people.

In 2019 the Government put a similar plan in place to support British Steel, costing the taxpayer a cool £600 million. British Steel was rescued by the Chinese Jingye Group and recently announced plans to invest £100 million to support the next stage of the company's transformation.

Jingye Group CEO Li Huiming, CEO of Jingle Group, commented: “We’re committed to building a long-term future for British Steel and thanks to the hard work and diligence of our new colleagues, the business is now on a more sustainable footing.

According to today's Financial Times, UK taxpayers are already exposed to more than £1 billion of debt from GFG (Liberty's parent company) and Greensill Capital via three government guarantees.

It is understood that no decision will be taken by the British Government unless Liberty Steel collapses, and at present Sanjeev Gupta, the man at the top at Liberty who in the past has been branded the saviour of the British steel industry, is confident he will secure new financing.