The market is “best placed” to deal with financial difficulties faced by Harland & Wolff, the Prime Minister has said.

The Government has decided not to offer financial support to the troubled Belfast shipbuilder over concerns of losing public money.

The company, which is part of a consortium that landed a major contract to build new Fleet Solid Support ships for the Royal Navy, had applied for a £200 million loan guarantee from the Government as part of efforts to restructure its finances.

However, the Government decided not to act as a guarantor on the lending – while also ruling out direct funding to maintain the company’s liquidity.

Speaking to reporters in Belfast, Sir Keir Starmer said the decision will be kept “under close review”.

He said: “We’ve obviously looked at that very carefully, the Business Secretary has made a decision about it.

“Of course, we will keep that under close review.

“We do think the market is best placed to deal with the current situation, but we’ll keep it under review because the work – particularly in the defence realm – is very, very important to us.”

Harland & Wolff, which famously built the Titanic, has four sites – one in Belfast, two in Scotland (Methil on the Firth of Forth and Arnish on the Isle of Lewis) and one in England (Appledore in north Devon).

The company has said it will seek alternative new debt facilities.