The government has said it will consider “all options” for the future of Tata’s steel plant in Port Talbot.
Ministers hope that Tata Steel will find a suitable buyer for the plant in south Wales, but if that options fail they had not ruled out offering government support to save the company, which employs 15,000.
It is understood that David Cameron does not want to see the collapse of the traditional British steel industry on his watch, making the possibility of some form of government intervention more likely.
If the government eventually chooses to nationalise the plant, it would be the first nationalisation of an UK industry by a Tory government since aircraft engine maker Rolls-Royce was nationalised by Edward Heath’s government in 1971.
It was a Tory government, led by Margaret Thatcher, that privatised British Steel in 1988.
Labour leader Jeremy Corbyn had called for ministers to act to protect the UK steel industry and “the core of manufacturing in Britain”.
Len McCluskey, general secretary of Unite the Union, called on the government to step in and save the plant. He said:
“The growing chorus of calls for renationalisation cannot be ignored by the Conservative government.”
Tata could close the plant within weeks if a buyer is not found to save the business, which currently loses about £1m per week, with a glut of Chinese steel keeping prices of steel in Europe low.