The Government has been blamed for the demise of the Moorside nuclear power plant.

Rob Johnston, chief executive of Cumbria Chamber of Commerce, blasted the Government for being negligent and allowing the collapse of a project that could have created around 6,000 construction jobs and a further 1,000 permanent operational roles.

The GMB union has also claimed the Government has blood on its hands for failing to act before Toshiba took the decision to wind-up the developer behind the scheme NuGen.

The Government hit back, describing Toshiba’s decision as a commercial matter and pledging its support for new nuclear projects.

Business leaders, unions, MPs and academics have repeatedly called for the Government to take a stake in NuGen to keep the Moorside project alive as its owners Toshiba struggled to find a buyer.

“This is a setback for Cumbria,” said Mr Johnston.

“It’s negligent of ministers to allow the Moorside project to collapse.”

He criticised the insistence of the Government to apply a regulated asset base (RAB) model for scaring off Korean utility Kepco, which had been in pole position to buy NuGen before Toshiba took the decision to cut its losses and wind the company up as it looks to tackle its own financial challenges.

The RAB funding model sees a regulator set a fixed sum for the cost of a project along with a fixed return, paid for by consumers, for the project’s investors.

But Mr Johnston claimed Kepco felt it would not give it a good enough rate of return and that direct Government investment would have reduced the risk, reduced the price of electricity generated and deliver a long-term return for taxpayers.

He also took a swipe at Government policy on its support for new nuclear development, after it emerged it is considering investing directly in Hitachi’s Horizon project at Wylfa Newydd in Anglesey.

“But they won’t consider direct investment in Moorside. Why not? Why is Wales a special case but not Cumbria?” he said, echoing criticism from Northern Powerhouse Partnership director Henri Murison, who said the situation did not represent a level playing field.

Mr Johnston added that the collapse of Moorside would have a huge impact on the nation’s energy supply, with the National Grid estimating generating capacity would have to increase by at least 80 per cent by 2050 to meet demand, particularly with the roll out of electric vehicles.

“That demand can’t be met without nuclear new build,” he said.

“If this is bad news for Cumbria, it’s a disaster for the UK’s energy security.”

His sentiments were echoed by two unions.

Unite regional secretary for the North West Ritchie James described Toshiba’s decision to wind-up NuGen as a cruel blow to the prospects for the North West economy and accused the Government of a hands-off attitude.

GMB national secretary, Justin Bowden, accused it of missing or ignoring opportunities to salvage Moorside.

He said: “The British government has blood on its hands as the final sad but predictable nail is banged into the coffin of Toshiba’s jinxed jaunt into nuclear power.

“Relying in this way on foreign companies for our country’s essential energy needs was always irresponsible.”

In response, the Department for Business, Energy and Industrial Strategy, said all new nuclear projects must provide value for money for consumers and taxpayers.

“All proposed new nuclear projects in the UK are led by private sector developers and while the Government has engaged regularly with the companies involved, this is entirely a commercial decision for Toshiba,” a spokesman said.

“This Government remains committed to new nuclear through the Industrial Strategy Nuclear Sector Deal as well as consenting the first new nuclear power station in a generation at Hinkley Point C.”

On energy security, they added: “There are no security of supply implications arising from Moorside failing to proceed. The UK has established processes using the Capacity Market to ensure security of supply through a diverse range of generation assets. Our Capacity Market exists to ensure we have energy when we need it.”