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<p>The Secretary of State for Business, Energy and Industrial Strategy has not issued
any Ministerial Directions in respect of British Steel.</p><p>This loan agreement
was fully commercial and state aid compliant, valued at around £120m, under Section
7 of the Industrial Development Act 1982. Under the agreement the Government purchased
emissions allowances on behalf of British Steel ensuring it met its 2018 ETS obligations.
Failure to comply with its ETS obligations would have led to a fine of around £500m,
on top of the costs of ETS compliance of around £120m.</p><p>In return, under a deed
of forfeiture, the company’s 2019 allowances will be assigned to the Government once
issued, and the proceeds from selling these is expected to cover the costs of purchasing
allowances for British Steel. The Government’s view is that the 2019 allowances will still be
issued to British Steel in insolvency.</p><p>The Government’s assessment is that the
Deed of Forfeiture offered value for money to the taxpayer, with benefits exceeding
the costs, predicated on the level of confidence around security, even in the event
of insolvency.</p><p>This position was supported by the independent Industrial Development
Advisory Board which assessed the proposal in their statutory role and agreed with
the Government’s value for money assessment.</p><p> </p><p> </p><p> </p>
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