The UK’s biggest steel company is pursuing alternative public financing due to scheduling setbacks to the transformation of its plant in Port-Talbot, a request which threatens to worsen the situation in Britain’s crisis-hit manufacturing sector.

Tata Steel approached the Department for Business, Innovation, Science and Trade in recent weeks to discuss a new multi-million pound support package.

The government aid formed part of a significant £ 1.25bn investment in the site which was supposed to have the new EAF operational by early 2028. Tata Steel has warned for years about the feasibility of Port Talbot with constant risk of shutdown during the last decade. Tata Steel has worked hard to use the £1.25bn investment in Port Talbot as an industrial preservation campaign in Britain.

When the public-private capital venture was formally approved two years ago, TV Narendan, Tata Steel’s chief executive said: “ With the UK government's critical support, this complex and ambitious transformation of Port Talbot has the potential to make the plant one of Europe's premier centres for green steelmaking.”

“We now look forward to the efficient and speedy execution of the EAF project.”

“We will also continue our work with the Transition Board and the UK and Welsh governments to enable this project to be a catalyst for economic regeneration and job creation in South Wales.”

The probability of enhanced public financing being used to back Tata Steel is bound to scrutinize the industrial strategy of Andy Burnham’s government. The latest comes in the midst of a larger crisis which has seen Britain’s subsidized steel giants brought to the brink of collapse by the government.

British steel is the second biggest player in the industry after legislative requisition passed by Parliament after threats by the company’s previous Chinese owner Jingye Group to close its blast furnaces at Scunthorpe.