A TROUBLED steel plant which employs dozens of Barnsley workers has had its future plunged into fresh doubt due to mounting debts just two years since it was given a new lease of life.

Bosses at Liberty Speciality Steel which employs 1,500 people announced they would ‘quickly consider alternative options’ after withdrawing a recovery plan they had been working on for six months.

They pulled away from a scheduled court date having revealed they had encountered difficulties in agreeing terms with creditors over the huge black hole.

The business owes £289m to main lender Greensill Capital, £288m to sister companies, £23m to unsecured creditors, £10m to another lender and £7.7m in tax to HMRC.

South Yorkshire leaders have come together since, who say they will do everything they can to strike a deal to safeguard jobs and the ‘vital’ industry which supports people across the county.

Penistone and Stockbridge MP Marie Tidball said: “I have been fighting for steel since day one and I understand that this time will be causing worry and uncertainty for steelworkers and their families.

“I have continued to speak closely to our steelworkers on the ground, Community Union, Liberty and the government over the last few days.

“I am encouraging all sides to come to the table and look at all options to secure the future of Stocksbridge Speciality Steels site.

“I am speaking to senior managers at Liberty frequently, including to ensure wages and pensions for steelworkers continue to be paid.

“The government have committed £2.5bn to secure the UK steel industry and have always been clear that there is a bright future for steel in the UK.

“The government will do everything they can to get it right for our British steel industry, including a commitment to using our steel assets productively.

“This must include Stocksbridge our local plant has strategically significant highly specialist capability to produce world-leading steel, which is crucial to our national defence, aerospace, and energy industries.

“Our steelworks has been the beating heart of our community for nearly 200 years, and I will continue to fight to protect our site, our jobs, and the strategic capability our site can offer.”

Gupta Family Group (GFG) Alliance, Liberty Steel’s parent company, had a bail-out request for £170m rejected by the previous government due to the company’s accounting procedures.

But due to refinancing debts at its Australian steel and mining sites, a lifeline came when GFG Alliance freed up £50m cash to be put into its South Yorkshire plants.

However, the latest setback has been described as ‘deeply concerning’ by South Yorkshire Mayor Oliver Coppard.

He said: “I spoke with the Business Secretary last Thursday to raise our concerns and we agreed to work together as more details emerge and the situation develops.

“Our steel industry has been integral to our identity and economy for generations.

“While the challenges we face are significant, I’m committed to working alongside industry leaders, unions and government partners to explore all possible avenues to safeguard jobs, support our steel sector and ensure that South Yorkshire remains at the forefront of advanced manufacturing.

“The news emerging about Liberty Steel is deeply concerning for all of us in South Yorkshire, but particularly those who work in their plants.”