The government has dismissed calls for a wage subsidy to keep the steel industry going through the recession.
Ian Cawsey, the Labour MP for Brigg & Goole, called a special Parliamentary debate on Tuesday to ask ministers to help steel giant Corus.
He said the company needed help to retain staff at its plants in Scunthorpe and elsewhere in the UK.
Other European countries are boosting the pay of workers who have been put on short working weeks as demand slumps.
Mr Cawsey admitted wage subsidy was an expensive option, but argued it was wiser in the long term.
"If we can spend £1.2bn on protecting jobs that would be a price very well worth paying.
"It strikes me that whilst across the world we all face the same problem, how we respond is going to be crucial to how soon and how extensive our recovery will be."
Business Minister Ian Pearson pointed out that the government was offering financial help to struggling companies.
But he insisted wage subsidies were not the answer.
"Wage subsidy schemes are extremely costly," he said.
He said many of the firms eligible for such relief would have retained workers without the subsidy anyway.
Mr Pearson added that wage subsidy schemes would "create distortion and perverse incentives" in the market.