Ed Miliband hits out at axing of Sheffield Forgemasters loan

Ed Miliband today criticised the coalition government's axing of an £80m loan to Sheffield Forgemasters , urging ministers to continue to think how they could help the company, which needs funds to manufacture components for new nuclear power plants. The Labour leader made the remarks on a visit to the Sheffield steelmaker the day after Vince Cable, the business secretary, told MPs that the loan was not affordable, which was why it had been included in a £10.5bn package of projects scrapped or suspended just months after they had been announced towards the end of the last Labour government. Miliband, who had condemned the withdrawal of promised funds during his first conference as the head of his party last month, said the loan should have remained in place. "I think they made the wrong decision, absolutely. It was a loan, it was a loan that would have been paid back. They have made the decision and I hope they continue to think about how they can help in the future from the funds available." The Labour leader said he hoped the company could get the investment it needed. "It is a fantastic British company and I was incredibly impressed by what I saw there today," Miliband said. Yesterday the Commons business select committee heard that of the 241 projects reassessed by the government, 217 were going ahead, 12 were being postponed and just 12 were being cancelled. The cuts would save between £1bn and £2bn, it was told. Cable previously agreed that the loan to Forgemasters was good value for money but he stressed yesterday that the scale of the cuts the government needed to make was due to the state of the economy it inherited. He said: "It would have been straight cash out of the door in the financial year." Cable said in a memorandum sent to the committee in August that the decision was based on affordability. The loan would probably have gone through if the government had been operating in an environment "where there were no budgetary constraints". The memorandum also said the government would look to see how it might help the company "when the future availability of public funds becomes clearer". The decision has been particularly controversial for Nick Clegg, the deputy prime minister, whose constituency is in Sheffield.