Question

To ask the Secretary of State for Energy and Climate Change, pursuant to his contribution of 4 September 2014, Official Report, column 425, on UK Coal, what assistance his Department has made available to UK Coal for the preparation of an application for state aid.

On Friday 26 September 2014 the Government agreed to provide a £4m loan to UK Coal as part of a package of support measures secured by the Company to avoid an imminent insolvency and closure of its Kellingley and Thoresby collieries. The loan has been made on commercial terms and is due to be fully repaid with interest by December 2015.

The support package was requested by UK Coal to deliver its plan for the safe and orderly wind down of its deep mining businesses by the end of 2015. However the loan is structured to ensure that the door remains open for the Company to seek further private investment to prolong the life of the mines beyond this date. I have also made it clear that I remain open-minded about any plan which UK Coal may wish to put forward involving further public sector support provided that the plan represents acceptable value for money for the taxpayer. However, we must be aware that without further support from Government alone, without commercial partnership to extend the deep mining business beyond 2015 is likely to be regarded as state aid by the European Commission and therefore require the closure of the mines. Any case for further support would need to come from the Company, but DECC officials will be ready to help.