Business secretary Jonathan Reynolds is facing growing pressure to refuse repayment of almost £1bn in loans owed to the Chinese former owners of British Steel.
British Steel owed just under £1bn to companies connected to its owner Jingye Steel before it was taken into public ownership earlier this year.
The debt figure emerged from the company’s 2024 accounts, which were filed last week and laid bare the scale of liabilities inherited by the government.
Reform UK business spokesman Richard Tice said the government should “stand firm” in the face of the debts owed to the Chinese firm.
“Taxpayers should not be rewarding Jingye for their failed ownership of British Steel,” Tice said, adding that billions more would be needed to rebuild the blast furnaces.
The near-£1bn total consists of around £500m owed directly to Jingye, the overall parent group that previously owned the steelmaker.
Two other Chinese subsidiaries, Power Rich Resources and Herbei Jingye Cut Deal Co., were owed a further $410m, with an additional £50m owed to Secure Trust Bank.
Company accounts suggested British Steel required hundreds of millions of pounds in fresh funding, with £555m already provided by the government to the Scunthorpe-based business.
The Office for National Statistics estimated British Steel would cost the taxpayer around £900m a year, according to reporting from June last year.
The government’s intervention came within Labour’s first year in power, triggered by fears that closure of Britain’s last remaining blast furnace would put more than 2,700 jobs at risk.
Parliament passed a bill enabling full nationalisation of British Steel in July, completing the state takeover of the strategically important steelmaker.
Tice, who is currently facing a parliamentary investigation, said Jingye should be “forced to take a full write down on their debt” and “be grateful to get away so lightly” for leaving taxpayers with liabilities.
It is understood no compensation has yet been paid, with a framework for any payout expected to be drafted later this year.
A government spokesperson said: “After assessing the impact on our economy, critical national infrastructure, and national security, we concluded that public ownership was the best way to secure British Steel’s future and protect the future of UK steel production.”
The spokesperson added that an independent valuer would determine what, if any, amount is payable to Jingye, with the government’s focus now on stabilising the business and building a decarbonised steel sector.