Scottish steel plate mill with Royal Navy order struggles to pay bills and workers

Liberty Steel Dalzell, a plate mill in Motherwell, Scotland, has struggled to pay its bills and its workers in recent weeks, The Guardian reported. The UK government said it was closely monitoring the situation at the site, which holds an order to make 34,000 tonnes of metal plate for the Royal Navy's Fleet Solid Support ships.

The company is owned by the Gupta Family Group (GFG) Alliance, which is controlled by Sanjeev Gupta. Output at the Dalzell plant has been limited for two years because of shortages in working capital, meaning the cash a business has available to meet its day-to-day costs. The National Energy System Operator (Neso) filed a winding-up petition against Liberty Steel Dalzell last month. A winding-up petition is a court application that can lead to a company being closed down and its assets sold to repay creditors.

The mill's importance to the naval programme is central to the story. According to The Guardian, Dalzell is the only mill in Britain capable of producing the plates needed for the Fleet Solid Support ships. The ships are designed to carry munitions, food and other supplies for the Royal Fleet Auxiliary, the fleet that supports the Royal Navy. The first ship is 216 metres long and is planned for delivery in 2031.

Construction of the ships is a separate arrangement. They are to be built in Belfast by Navantia, the Spanish state-owned shipbuilder, under a £1.6bn contract. According to The Guardian, Navantia said it would build the first ship largely in Spain because the Harland & Wolff shipyard was not yet ready.

A UK government spokesperson said Navantia UK has a "local first" policy for suppliers on the Fleet Solid Support programme.