Turning Up The Heat

Labour is putting pressure on the coalition over the government’s decision to cancel an £80m loan to Sheffield Forgemasters. Pat McFadden has written to Vince Cable asking who knew about Tory party donor and businessman Andrew Cook lobbying the government to cancel the loan, while Ed Miliband has called for an independent inquiry. The prime minister’s spokesperson has rejected Labour’s claims, saying the decision was “based on affordability”. Nick Clegg has called the allegations “absurd”.

Parliament was told ministers received a letter from Andrew Cook – chairman of Sheffield-based steel firm William Cook – suggesting the loan be scrapped. Labour had originally pledged the £80million loan as part of Britian’s “low carbon economy” but it was scrapped later by the coalition government.

The Government’s decision to cancel an £80 million loan to a Sheffield steel company followed lobbying from a Tory donor who heads another steel company in the same region, Labour MPs claimed last night. The issue was raised in the House of Commons on Wednesday night by Angela Smith, the Labour MP for Penistone and Stocksbridge, who obtained the letter following a Freedom of Information (FoI) Act application.

The decision to cancel the loan to Sheffield Forgemasters, that had been agreed by the Labour Government, caused controversy when it was announced as part of the coalition’s cost cutting programme last month. The loan would have funded a programme to create parts for nuclear power stations, creating 180 jobs in a region that includes the constituency of the Deputy Prime Minister Nick Clegg.

Nick Clegg told BBC Radio Sheffield the suggestion was “absurd” and it was down to reasons of affordability. Mr Clegg said: “It’s constant muck-raking from Labour MPs who won’t live up to their own responsibility in making a number of promises with money they didn’t have.”

In my opinion the £80million pound is one of a number of cost cutting measures I don’t agree with. Not only would it create 180 new jobs, it would safeguard existing jobs and provide us with the capabilities to extend our nuclear energy plans. Surely that’s small change compared to the hundreds of millions being protected in foreign aid. To me this stinks of a knee jerk reaction to cutting costs rather than taking a long term view and cutting only where truly makes sense. Short term savings can create long term costs – this coalition needs to be careful it doesn’t leave the country with a big bill for the future.

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