Exactly three months after Labour announced an £80m government loan deal for Sheffield Forgemasters, with further support from Westinghouse Electric and the European Investment Bank, Vince Cable dealt a blow to the Yorkshire region by backing out.

“This is terrible news for the region, as well as for the wider prospects of new nuclear build in the UK,” said Mike Graham, Prospect National Secretary. “It’s ironic that this government should move so fast to attack a measure so important to progressing Britain’s move to a low-carbon economy.

“Energy minister Charles Hendry himself conceded in a speech to the Nuclear Industry Forum yesterday that £200bn of new investment will be needed in energy to address climate change, which he described as ‘one of the biggest challenges of our lifetime’.

“New nuclear build is essential to achieving these objectives, and the Forgemasters project would have provided a vital link in the supply chain, as well as many skilled jobs, by producing a 15,000 tonne press to make pressure vessels and castings for nuclear reactors.

“We are dismayed at the hypocrisy of this decision, which will be counterproductive to the government’s own declared aims.”