Sheffield Forgemasters

Lord Hunt of Kings Heath Excerpts

Thursday 22nd July 2010 Lords Chamber

Asked By

[Lord Hunt of Kings Heath]

To ask Her Majesty’s Government why they cancelled a loan to Sheffield Forgemasters, given the willingness of the company to dilute its equity share.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, the decision not to pursue the loan was taken on grounds of affordability.

[Lord Hunt of Kings Heath]

My Lords, both the Prime Minister and the Deputy Prime Minister in the other place made statements to the effect that the reason why the loan was withdrawn was that the company would not dilute its equity share. It has since transpired that the Deputy Prime Minister was aware that the company was in fact prepared to dilute its equity share. Why will the Deputy Prime Minister not apologise to Parliament for misleading it? Why have the Government taken such a crass decision to withdraw the loan from the company, which could have provided a massive foundation to the development of a nuclear supply chain industry in this country?

[Baroness Wilcox]

Absolutely not. Our decision not to proceed with the loan was a matter of affordability and that only. The shareholder structure of SFIL did not influence any assessment. I have no knowledge of any privy discussions between the Prime Minister and the Deputy Prime Minister. The Government’s decision has absolutely nothing to do with this issue. We regard Mr Honeyman and his team as having produced an excellent project with no criticism of him or of the company. Perhaps the Opposition should apologise for the necessity of cuts based on the state of the economy that we inherited.