No. 10 refuses to deny that subsidy for nuclear power has broken Coalition Agreement

The PM's spokesman merely says that the agreement on a new nuclear power station is "a very important announcement".

The Coalition Agreement was unambiguous on the question of public subsidy for new nuclear power stations: there would be none. It stated:

Liberal Democrats have long opposed any new nuclear construction. Conservatives, by contrast, are committed to allowing the replacement of existing nuclear power stations provided that they are subject to the normal planning process for major projects (under a new National Planning Statement), and also provided that they receive no public subsidy.

But this pledge is flatly contradicted by today's deal on a new plant in Hinkley, which guarantees the French-owned EDF and Chinese state investors a strike price of £92.50 per MegaWatt Hour, nearly twice the current market rate for wholesale energy, over a 35-year period.

When I put this point to the Prime Minister's spokesman at this morning's Lobby briefing, he replied:

Today is a very important announcement, it's around, as he [David Cameron] described it, long-term planning for our economy, for energy security, actually for jobs as well, there are 25,000 jobs associated with today's announcement, and we need this broad energy market and that's why today's announcement is a very important one.

I replied that this was an explantion of why the investment was needed, not of why the position had changed, and he said:

I actually think that the position around the need for energy security, the need for more competition in the market, that has been the government's policy and you're seeing a very important announcement today in regard to that.

So No. 10 is refusing that deny that the coalition has broken its 2010 pledge on public subsidy, simply because it cannot credibly do so. Should wholesale prices fall or rise at a slower rate than expected, it is the public who will pick up the tab in the form of higher bills (which are expected to rise by around £8 as a result of today's agreement) or higher taxes.

But if it is remarkable that the Tories, who dismiss a two-year energy price freeze as "socialism", are willing to guarantee foreign state-owned companies prices for 35 years, it is even more remarkable that the Lib Dems have gone from opposing any new nuclear power stations to supporting a multibillion subsidy for them.

Energy Secretary Ed Davey and David Cameron examine site plans for Hinkly C nuclear power station at Hinkley Point. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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New Digital Editor: Serena Kutchinsky

The New Statesman appoints Serena Kutchinsky as Digital Editor.

Serena Kutchinsky is to join the New Statesman as digital editor in September. She will lead the expansion of the New Statesman across a variety of digital platforms.

Serena has over a decade of experience working in digital media and is currently the digital editor of Newsweek Europe. Since she joined the title, traffic to the website has increased by almost 250 per cent. Previously, Serena was the digital editor of Prospect magazine and also the assistant digital editor of the Sunday Times - part of the team which launched the Sunday Times website and tablet editions.

Jason Cowley, New Statesman editor, said: “Serena joins us at a great time for the New Statesman, and, building on the excellent work of recent years, she has just the skills and experience we need to help lead the next stage of our expansion as a print-digital hybrid.”

Serena Kutchinsky said: “I am delighted to be joining the New Statesman team and to have the opportunity to drive forward its digital strategy. The website is already established as the home of free-thinking journalism online in the UK and I look forward to leading our expansion and growing the global readership of this historic title.

In June, the New Statesman website recorded record traffic figures when more than four million unique users read more than 27 million pages. The circulation of the weekly magazine is growing steadily and now stands at 33,400, the highest it has been since the early 1980s.