In a decisive move to shore up British industry and protect hundreds of jobs, the UK government, in partnership with NatWest Group and chemical giant Ineos, has announced a £150 million rescue package for the Grangemouth ethylene plant in Scotland. The deal, revealed on December 17, 2025, comes at a crucial moment for the country’s manufacturing base, following the recent closure of the Grangemouth oil refinery and looming uncertainty over the future of the sector.
The funding package includes a £75 million government-backed loan guarantee—facilitated by NatWest through NatWest Group plc—a £50 million direct grant from the UK government, and £25 million in equity from Ineos. According to The Financial Times, this intervention will secure the jobs of more than 500 workers at the site, Britain’s largest chemical plant, and underpin the facility’s continued production of ethylene, a key component for medical-grade plastics and a vital link in the nation’s advanced manufacturing, automotive, and aerospace supply chains.
Business Secretary Peter Kyle, Chancellor Rachel Reeves, and Scotland Secretary Douglas Alexander are set to visit Grangemouth to formally announce the funding, underscoring the government’s commitment to industrial resilience. As The Guardian reported, the move has been framed as a high-profile industrial intervention, reflecting the strategic importance of maintaining domestic production capabilities in the face of global competition and shifting economic winds.
Jim Ratcliffe, owner of Ineos and a prominent investor in Manchester United, had previously criticized the UK’s carbon tax regime and signaled intentions to invest more heavily in the US. However, Ratcliffe welcomed the government’s support, stating, “UK government support for Ineos’s investment shows the strategic importance of making things in Britain,” and adding that the deal “preserves the industrial capability the nation needs.”
The Grangemouth site, which has seen over £100 million in maintenance investment from Ineos in the past year alone, had been at risk of closure due to high carbon taxes imposed on manufacturers. The government’s financial lifeline is not just about saving jobs—it is also designed to improve energy efficiency, reduce carbon emissions, and boost productivity at the plant, aligning with broader national goals for a greener, more competitive industrial sector.
NatWest Group’s role in the deal is notable. As reported by Reuters and confirmed in Ineos’s own statements, NatWest acted as the facilitator for the loan guarantee, reinforcing its position as the “bank for business.” Robert Begbie, NatWest’s Commercial & Institutional CEO, said the funding would support national resilience and job protection. The bank’s involvement in such a politically sensitive and economically significant package highlights the evolving relationship between major financial institutions, government policy, and industrial strategy in the UK.
This is just one of several headline initiatives for NatWest as it seeks to redefine its public image and operational priorities. On the same day as the Grangemouth announcement, NatWest revealed plans to double its social rent loan fund from £500 million to £1 billion, aiming to accelerate the delivery of homes for social rent across the UK. The fund, described by NatWest as a first-to-market product, offers no arrangement fees and discounted interest margins for eligible housing associations already banking with NatWest. The bank says this could save the sector up to £50 million in finance costs and is part of a broader ambition to lend £7.5 billion to the social housing sector by the end of 2026.
Early beneficiaries of the expanded fund include VIVID, which drew £100 million to build 450 new social rent homes, and Bromford Flagship, which secured £50 million for the development of over 470 new homes. With more than 1.3 million people on the UK’s social housing waiting lists, NatWest’s move is both a response to urgent social need and a strategic play for long-term engagement with the housing sector.
Innovation is also high on the agenda. According to Reuters, NatWest is working with the Financial Conduct Authority (FCA) on trials of “agentic AI” systems—advanced artificial intelligence tools that can plan, decide, and act autonomously. Customer-facing trials are expected to begin in early 2026, with the FCA emphasizing the need for robust consumer protection and governance frameworks as these technologies become more autonomous. For NatWest, the successful deployment of agentic AI could mean improved customer engagement and reduced servicing costs, but the bank is mindful of the regulatory and reputational stakes involved.
On the regional growth front, NatWest has strengthened its Bristol Accelerator Hub with two new Acceleration Managers, Chris Blues and Olivia Holmes, to support start-ups and SMEs in the South West. The bank’s accelerator platform has already aided over 10,000 entrepreneurs nationwide, and a flagship event—“Inside the Economy – 2026 UK Outlook”—is scheduled for January 22, 2026, featuring principal economist Stephen Blackman.
Meanwhile, the macroeconomic backdrop is shifting. As noted by Reuters, UK CPI inflation dropped to 3.2% in November 2025, down from 3.6% in October, fueling market expectations that the Bank of England will cut interest rates by 25 basis points to 3.75%. While lower rates can compress banks’ net interest margins, they can also stimulate credit demand and ease pressure on household finances—a delicate balancing act for lenders like NatWest as they navigate an environment of evolving risks and opportunities.
The Grangemouth deal arrives just as another major Scottish ethylene plant faces closure. ExxonMobil recently announced plans to shutter its Mossmorran facility in Fife, with 179 staff and 250 contractors affected. Scotland Secretary Douglas Alexander explained that government support was not extended to ExxonMobil due to a lack of investment and no clear pathway to profitability at the aging plant. “The Mossmorran facility is now 40 years old, it was built to have a 20-year lifecycle. Alas, there hasn’t been the scale of investment that many of us would wished to see in Mossmorran over recent years,” Alexander said. However, Unite officer Bob MacGregor disputed this, telling MPs that £100 million had been invested in Mossmorran over five years—a figure ExxonMobil chair Paul Greenwood later put at £270 million. MacGregor called for a pause in closure plans to allow talks with potential buyers and criticized what he described as a lack of tangible government support for oil and gas workers.
For NatWest, the Grangemouth package is emblematic of a larger shift: banks, government, and industry working in concert to navigate a complex economic landscape. Whether in industrial rescue, social housing, or AI innovation, the bank is positioning itself at the heart of Britain’s next phase of growth and transformation.
With the fate of Grangemouth secured for now, the spotlight turns to how these partnerships—and the broader policy framework—will shape the future of UK industry and finance in the years ahead.
