Chemical companies owned by the billionaire Jim Ratcliffe had already been granted as much as £70m in UK state aid in the past four years, before this week’s £50m government bailout for its Grangemouth plant in Scotland.
State aid to Ineos in the last year alone was between £16m and £38m, according to government disclosures published this week. Since August 2022 the company has received between £28m and £70m.
The government stepped in on Tuesday to give Ineos £50m to support Grangemouth, fearing that without it the UK would lose its last plant making ethylene, an important material for making plastics. The government also backed a £75m loan guarantee, while Ineos will invest £30m of its own money.
Ineos had already closed the next-door oil refinery in September 2024 with the cost of 400 jobs, in a huge blow to the community and a political problem for the government.
Ratcliffe, who is worth $14.5bn (£11bn) according to Bloomberg’s billionaires index, asked the government for help in October.
It comes at a time when the expansive group of Ineos companies, controlled by the 73-year-old, has been under financial pressure, in part because of the big increase in energy costs after Russia’s full-scale invasion of Ukraine in 2022.
Fitch Ratings downgraded Ineos’s credit rating in September, in a sign of increasing concern over its ability to repay its debts. Ratcliffe has also had to spend heavily on his off-road car venture, the Ineos Grenadier, as well as seeking to turn around Manchester United, in which he holds a minority stake.
Most of the previous state aid to Ineos came in the form of tax breaks in return for “voluntary agreements to reduce energy use and carbon dioxide emissions”. The tax breaks for Ineos’s plants in Grangemouth and Hull are reported as ranges, rather than giving precise figures.
An Ineos spokesperson said the aid was not “special treatment” for Ineos, but was “awarded against strict criteria, and available to any UK business that qualifies”.
Ratcliffe this week welcomed the £50m support for the chemicals business in a statement included in a government press release. However, Ineos issued a separate release that contained much more critical comments, in which the billionaire strongly criticised government policy, including carbon taxes that are paid by industrial users on their energy bills.
“The answer is NOT decarbonisation by deindustrialisation,” Ratcliffe wrote. “Without a strong manufacturing base, the economy will continue to decline. High energy costs and punitive carbon charges are driving industry out of the UK at an alarming rate.”
In further comments to media outlets this week, Ratcliffe described carbon taxes as “the most idiotic tax in the world”. He argued that the taxes leave UK plants at a disadvantage to foreign rivals, which do not have to pay the extra costs. Most chemicals and plastics are not part of the UK’s initial carbon border adjustment mechanism, a tax on high-carbon imports such as steel, glass, cement and fertilisers.
An Ineos spokesperson said: “Ineos has invested over £400m at Grangemouth in the last five years to keep it one of the most efficient chemical plants in Europe and to protect skilled jobs. UK chemicals have had a brutal year, yet everyone relies on this industry every day. If we don’t make these essential materials in the UK, they are imported instead, often from higher-carbon production abroad.”
Colin Pritchard, head of sustainability and external affairs for Ineos’s Olefins & Polymers division, this week said the money for Grangemouth would be devoted to improving energy efficiency, cutting its carbon emissions and improving performance.
He said the site, which runs an ethylene cracker that takes North Sea gas and liquified petroleum gas from the US to make its petrochemicals, had been under “extreme pressure” from surging energy costs linked to Russia’s invasion of Ukraine and the UK’s carbon taxes.
Ineos has previously received tax breaks worth hundreds of millions of euros from the EU. Ratcliffe was a prominent backer of the campaign to leave the EU.
