Financial agreement worth £500 million awarded by Network Rail to aid British Steel in their operations.
British Steel has secured a five-year contract worth approximately £500 million with Network Rail, marking a significant milestone in the UK's rail industry and manufacturing sector. The deal, announced in June 2025, will see British Steel supply over 337,000 tonnes of rail track for the UK's rail network.
Under the terms of the contract, British Steel will manufacture all rails at its Scunthorpe steelworks, the only UK facility producing rail track. The rails produced will primarily support maintenance and renewals on Network Rail's infrastructure. The agreement is set for five years, with an option to extend for an additional three years.
This deal is a major economic boost for British Steel, particularly the Scunthorpe plant, which faced the threat of closure earlier in 2025 but was saved by urgent government intervention. The contract is expected to protect thousands of skilled manufacturing jobs in the UK steel industry, reinforcing the company's future and its workforce.
The contract covers around 80% of Network Rail's needs for train tracks. While Network Rail will award smaller contracts to European manufacturers for the supply of specialist rail products, British Steel will remain the main supplier of rail for Network Rail in the years ahead, according to Clive Berrington, group director for railway business services at Network Rail.
This contract underscores British Steel’s role as a key supplier critical to maintaining and renewing Britain’s rail infrastructure. It is also seen as a vote of confidence in UK steelmaking expertise and the broader British manufacturing sector. The deal aligns with the UK government’s "Plan for Change," aiming to bolster domestic production and infrastructure to stimulate economic growth.
Heidi Alexander, the transport secretary, stated that the new contract will transform the outlook for British Steel and its workforce. If British Steel had gone into administration, thousands of job losses would have occurred. However, this contract is expected to keep British Steel busy for the next five years.
The contract is expected to start on 1 July 2025, requiring British Steel to supply a minimum of 337,000 tonnes of track. The contract represents a critical supply agreement securing the manufacture of about 70,000 to 80,000 tonnes of rail annually, enough to lay track between London and Edinburgh each year.
In addition to its economic benefits, the contract also underscores the government's commitment to sustaining domestic industry and ensuring the resilience of the rail network. The Transport Secretary's involvement highlights the strategic importance of safeguarding British industry and infrastructure supply chains. This deal is a testament to the government's efforts to support UK businesses and promote economic growth.
- The significant milestone in the UK's rail industry and manufacturing sector, as British Steel secures a five-year contract worth approximately £500 million with Network Rail, is also a boost to the finance sector, given the substantial investment involved.
- In the realm of politics, this contract is aligned with the UK government's "Plan for Change," aiming to bolster domestic production and infrastructure to stimulate economic growth, particularly in the energy-intensive steel industry.
- The general-news implications of this contract extend beyond the rail industry, as it underscores the importance of a robust domestic steel industry in maintaining critical infrastructure like the UK's rail network, thereby ensuring the resilience of the business sector.
