The Chief Secretary to the Treasury (Mr David Gauke)
The UK Guarantees scheme was announced in July 2012 with spending cover provided through the Infrastructure (Financial Assistance) Act 2012, receiving Royal Assent on 31 October 2012. The scheme provides a sovereign-backed guarantee to help infrastructure projects raise debt finance. Guarantees for up to £40 billion in aggregate can be offered under the initiative.
As part of the Hinkley Point C negotiations, EDF sought a Government guarantee to assist in bringing forward investment. The Government are confirming that they have approved the provision of a guarantee for up to £2 billion to the project for the construction of its new EPR nuclear plant in Somerset, backed by commitments from the shareholders. The guarantee will be available from 2018 to 2020 if necessary conditions are met and is at Government’s discretion. Even if made available, and EDF have indicated to the Secretary of State for Business, Energy and Industrial Strategy that it is not their current intention to take up the guarantee, I judge the likelihood of any call under the guarantee to be very low.
The Government will report to Parliament on the financial assistance given in line with the requirements set out in the Infrastructure (Financial Assistance) Act 2012.
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