Labour is urging the Government to invest in an ambitious green stimulus to support the steel industry to decarbonise and to deliver long-term jobs following a decision to call in an application for a new coal mine on the Cumbrian coast.

Environmental campaigners welcomed a decision by Communities Secretary Robert Jenrick to announce a public inquiry into the controversial application.

Mr Jenrick said he believed the application had raised issues of “more than local importance”, adding he had decided that a public inquiry should be held to explore the arguments put forward by both supporters and opponents of the proposal by West Cumbria Mining (WCM) to open the deep mine near Whitehaven.

Shadow business secretary Ed Miliband said on Friday: “Opening a new coal mine was never going to be the right answer for the steel industry and was never going to create secure jobs.

“The vast majority of the coal was planned for export and there were question marks about whether it would be usable by British steelmakers.

“The Conservatives should stop peddling false solutions and instead focus on genuine ones to secure a long-term future for our steelmakers, as Labour has long called for.

“The steel industry received no support in the Budget and there was not even one mention of steel in the Government’s plan for growth.

“That’s what Conservative MPs should be furious about.”

Mr Miliband said the Government should now invest in an ambitious green stimulus to support the steel industry to decarbonise and to deliver long-term jobs in Cumbria and across the North.

Greenpeace UK’s chief scientist, Doug Parr, said: “It should never have taken this long for the coal mine to be called in – the case for it was untenable from the start.”

Friends Of The Earth climate campaigner Tony Bosworth said the Government announcement was a “startling, but very welcome U-turn”, adding: “A new coal mine in Cumbria would not only wreck our climate, it would also destroy the UK Government’s credibility ahead of crucial climate talks in Glasgow later this year.

“Planning permission must be refused: ending coal use, whether for power generation or for industry, is crucial for facing down the climate emergency.

“It was not possible for the Government to maintain, as it claimed only two months ago, that this was just a matter of local importance and the decision will now rightly be taken at national level.”

Boris Johnson refused to be drawn on the decision after ministers had previously refused to intervene, insisting it was a matter for Cumbria County Council.

“This is a quasi-judicial planning decision. I can’t actually get involved,” he told reporters during a visit to Northern Ireland on Friday.

“This is something that needs to be looked at very carefully and will be properly assessed. I should stay shtum on this one.”