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Oral Answers to Questions
(10 years, 11 months ago)
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Mr Speaker
Order. Before I call the first question to the Deputy Prime Minister, hon. and right hon. Members may have noted that there are only four substantive questions to the Attorney-General on today’s Order Paper; six were withdrawn yesterday. It may be helpful for the House to be aware that if we exhaust questions to the Attorney-General before 12.30, we will revert to topical questions to the Deputy Prime Minister.
Katy Clark (North Ayrshire and Arran) (Lab)
1. When he plans to bring forward legislative proposals on the regulation of lobbyists.
The Parliamentary Secretary, Cabinet Office (Miss Chloe Smith)
The Government have repeatedly made very clear their commitment to introducing a statutory register of lobbyists. The events that have unfolded over the weekend demonstrate just how important transparency in political life is. We will therefore introduce legislation to provide for a lobbying register before the summer recess. The register will go ahead as part of a broad package of measures to tighten the rules on how third parties can influence our political system.
Katy Clark
Given what has happened over the last few days, does the Minister accept that the public expect full transparency on how big business and money try to influence decisions? Will the legislation include not just lobbying companies but in-house lobbyist for-profit organisations?
Miss Smith
The aim of any reform in this area must, I think, be to ensure that the activities of outside organisations are transparent to the general public and accountable. As we have said throughout the process, it is important that we get this right. We will announce more details in the coming weeks. The hon. Lady will be aware from the proposals already put forward that the intention is to regulate third-party lobbyists. Let us not forget what this is for: it is about knowing who is lobbying and on behalf of whom.
Mr Douglas Carswell (Clacton) (Con)
In order to tackle some of these concerns, the suggestion has been made that we should have a right of recall. Will the Minister confirm that a right of recall would include a recall ballot, so that instead of leaving it to a committee of grandees in Westminster to decide an MP’s future, constituents would have the chance for a final say?
Mr Speaker
That is very wide, but we will have a brief reply from the Minister and then move on.
Miss Smith
My hon. Friend and I have exchanged views on this subject a number of times, and I look forward to doing so again. As to what we are discussing today, Mr Speaker, you and he will know that there was a draft Bill. We continue to work through its detail and I look forward to bringing forward the further details in due course.
Nic Dakin (Scunthorpe) (Lab)
11. Given that MPs across the parties, and particularly those of us elected in 2010, have been calling for action on lobbyists since we were first elected, why has it taken three years, and still no action? When will we actually have a register in place?
Miss Smith
There are two points: one, we are doing it; and two, the Opposition did not do it 13 years.
Mr James Gray (North Wiltshire) (Con)
Although we all strongly support openness and transparency of the kind that the Minister has described, does she agree with me that the sort of blatant entrapment carried out by the “Panorama” programme at the weekend would not have been prevented by any such register of lobbyists? Does she also agree that there is a risk of doing something simply in order to be seen to be doing something without addressing the real problems besetting us?
Miss Smith
Mr Speaker, I do not think you would want me to go into the details of the particular case to which my hon. Friend refers. It is important to draw from that, however, that the public expect us to act, that we have said for quite some time that we shall be doing this and that we are bringing forward the details from now onwards. I think that a number of factors might have gone into the events that we saw unfold over the weekend, and it is important to take a wider look at some of them.
Mr Iain McKenzie (Inverclyde) (Lab)
13. Why are the Government conflating the issues of regulating lobbyists with those of party funding, when previously no links whatever were made between them? Is this a shoddy tactic of the Prime Minister and the Government to get them out of a hole, given that they have done nothing about regulating lobbying before now?
Miss Smith
As I think I have made clear, this is about third parties more generally, and it is right to understand how third parties can influence the political process in general. It is something in which the general public will take a great interest.
John Stevenson (Carlisle) (Con)
Does the Minister agree that trade unions are also lobbyists, so if legislation is to be brought forward, they should be included in it?
Miss Smith
I think that our legislative proposals will allow ample opportunity for that and other issues to be discussed. It has been shown in the last few days that there is enormous public concern about the external influences that can arise in relation to people who make laws, and I think it right for third parties and undue influence to be considered.
Sadiq Khan (Tooting) (Lab)
I am sure that the Minister is as disappointed and disgusted as all other parliamentarians by the allegations made in the media over the weekend. She will be aware that the manifestos of all three main parties contained commitments to make lobbying more transparent, and to give the electorate more power to hold Members of Parliament to account. Does she agree that if these proposals are to be implemented swiftly, and if the resulting measures are to be enduring, all-party support and work will be necessary? Will she ensure that all parties are involved in the work that will take place before the Bill is published?
Miss Smith
My right hon. Friend the Deputy Prime Minister and I look forward greatly to working with the right hon. Gentleman and others to support proposals that will make the activities of third parties more transparent to the public.
Mr Philip Hollobone (Kettering) (Con)
Given that the proposals constituted a strong part of the coalition agreement, why were they not included in this year’s Queen’s Speech?
Miss Smith
We made it clear all along that we intended to introduce this Bill. Working on the detail is important, and I think all Members will welcome the fact that we are doing that now.
Pat Glass (North West Durham) (Lab)
2. What plans he has to bring forward further proposals for reform of the House of Lords.
The Deputy Prime Minister (Mr Nick Clegg)
We have no proposals for a comprehensive new overhaul of the House of Lords. We tried that once, and did not make the progress for which I had hoped. I remain of the view that the introduction of democracy is the only serious long-term reform that the House of Lords requires, but if any minor technical housekeeping changes that are deemed necessary—for instance, kicking out crooks or people who do not attend, or extending the voluntary retirement scheme—require legislative backing, we will of course consider incorporating them in wider Bills, such as the Bill providing for the recall of MPs from this place.
The Deputy Prime Minister
I see no need for a stand -alone Bill on House of Lords reform, not least because the real reform—namely, the introduction of democracy —has not made progress. As I have said, however, there are a few very specific housekeeping measures that we could incorporate, and would be prepared to consider incorporating, in a wider Bill if the need arose during the coming period.
Mr Bernard Jenkin (Harwich and North Essex) (Con)
Why did my right hon. Friend choose to answer this question and not the question about lobbying, which has been in his in-tray for the last three years?
Wayne David (Caerphilly) (Lab)
Owing to the opposition of large elements of the Conservative party, the Deputy Prime Minister’s plans for Lords reform came to nowt. Will he now co-operate with our party to ensure that the excesses and alleged abuses in the other place are tackled immediately?
The Deputy Prime Minister
That is pretty rich, coming from a Front Bencher of a party which, despite its own long-standing manifesto commitment in favour of democracy in the House of Lords, could not even bring itself to support a timetable motion to make that a reality.
As I said earlier, if specific housekeeping measures are necessary—involving Members of the House of Lords who have committed crimes and should not be there, or who have never attended and should not be there, or involving voluntary retirement—and if we can sweep those measures up into a wider Bill such as the one providing for the recall of MPs, we shall be prepared to consider doing so.
Graham Evans (Weaver Vale) (Con)
While he is in a reforming mood, will my right hon. Friend join me in my campaign to reform early-day motions, which can be used by lobbyists? Will he pledge his support for that campaign?
The Deputy Prime Minister
Obviously it is important for all proceedings in the House to be conducted as transparently as possible, and for the motives of Members to be made obvious to their constituents and to the public.
Mr Speaker
Order. It is always helpful when Members look at the question on the Order Paper and ask a coherent supplementary that relates to it rather than to something else. That should be a helpful part of the learning curve for the hon. Member for Weaver Vale (Graham Evans).
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
14. The Deputy Prime Minister may have missed this while dealing with all his other duties yesterday, but his noble colleague Lord Oakeshott suggested that the House of Lords was full up. Does he agree?
The Deputy Prime Minister
Historically, the House of Lords has been as large as this House, and of course there are—[Interruption.] I will not repeat what the hon. Member for Bolsover (Mr Skinner) said from a sedentary position. The question of how many Members of the House of Lords are active is also relevant, and a number of them do not turn up very regularly.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
3. What recent discussions he has had with ministerial colleagues on devolving power from Westminster and Whitehall.
Jonathan Lord (Woking) (Con)
5. What recent discussions he has had with ministerial colleagues on devolving power from Westminster and Whitehall.
The Deputy Prime Minister (Mr Nick Clegg)
I regularly meet ministerial colleagues to discuss the Government’s work to devolve power to the most appropriate level, and we are achieving that through local enterprise partnerships, local government finance reforms, giving local authorities a general power of competence, and city deals. We have also accepted in full or in part 81 of Lord Heseltine’s 89 recommendations, which build on that work to decentralise power and drive growth. We have delivered a referendum in Wales, which resulted in the Assembly assuming primary law-making powers, and we established the Silk commission. In addition, the UK and Scottish Governments are working together to ensure the smooth implementation of the Scotland Act 2012, which represents the greatest devolution of fiscal powers from London in 300 years.
Stephen Metcalfe
Although I recognise the importance of the city deal in delivering opportunities for growth, does the Deputy Prime Minister agree that devolving power to our county councils, such as Essex, can have an equally effective impact on developing local growth?
The Deputy Prime Minister
Devolution at all levels is a virtuous thing. The more we can devolve power and control over money and decision making from Whitehall to the town hall, and from the town hall to local areas, the better. One of the exciting insights of the Heseltine report, which we are determined to act on, is precisely to give local areas, led—not entirely, but in part—by the local enterprise partnerships in each area, a real opportunity to draw down powers and resources from Whitehall, which have been hoarded at the centre for so long.
Jonathan Lord
I welcome what the Deputy Prime Minister has to say about devolving power to local government and the progress made to date. Does he agree that in the medium term we should be looking to local government to be self-financing—not only keeping and setting council tax, but keeping business rates as well? That would be the way towards real power and accountability.
The Deputy Prime Minister
As my hon. Friend knows, the coalition Government are introducing the biggest devolution of control over business rate revenues in a generation. Of course we cannot completely devolve it because that would mean that those areas that had the wealth locally to sustain themselves would be fine, and those that did not would not, so we need some kind of mechanism to make sure there is fairness in the system. However, the reforms, particularly of business rate revenues, that we have presided over are the biggest act of fiscal devolution in a very long time.
Ms Margaret Ritchie (South Down) (SDLP)
Beyond discussions on corporation tax, what conversations has the Deputy Prime Minister had with the Northern Ireland Executive regarding the devolution to it of further powers, including on telecommunications, broadcasting, motor taxation and other economic levers?
The Deputy Prime Minister
I have not personally been involved in detailed discussions on those issues, but my right hon. Friend the Secretary of State for Northern Ireland is in continuous dialogue with the authorities in Northern Ireland about them.
Geraint Davies (Swansea West) (Lab/Co-op)
Under measures in the draft Wales Bill, candidates for the Welsh Assembly can stand both on the regional list and the constituency list. Therefore, in places like Swansea West a Liberal Democrat candidate can have two lots of election expenses against the sitting Assembly Member. Will the Deputy Prime Minister make sure that that does not happen?
The Deputy Prime Minister
We have, of course, made reforms in this area already, but we will continue to keep them under review.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
Does my right hon. Friend agree that the north-east of England could benefit greatly from the kind of devolution he is working on? It would promote growth in the region, but he also needs to make sure that the rural areas of the north-east have a key decision-making role when that devolution happens.
The Deputy Prime Minister
I strongly agree, and I pay tribute to my right hon. Friend for the way in which he has championed his constituency, particularly on transport links which I know are a bone of contention there and in the region more generally. I also know he agrees with me that the north-east in particular has great natural strengths that could enable it to become not only a national but a European and world leader in renewable and offshore technologies. That is precisely why the industrial strategies of my right hon. Friend the Business Secretary have been devoting so much attention to that sector.
Chris Bryant (Rhondda) (Lab)
Some people in Wales are apparently in favour of devolving crime, policing and the justice system to the Welsh Assembly, but I am wholeheartedly opposed to that. Will the Deputy Prime Minister confirm that devolution is not a devolved responsibility?
The Deputy Prime Minister
It is no surprise to me to learn that the Labour party, once again, is somewhat forked-tongued in its commitment to further devolution to Wales: in Cardiff it talks a good game about further devolution of powers from London to Cardiff, yet here it continues to want to hoard powers. As the hon. Gentleman knows, the Silk commission is in two parts, the first of which, on further fiscal powers, has already reported. We are determined to respond soon enough to that report, which was made on a cross-party basis. The second part of the Silk commission looks at the wider constitutional settlement, and it has not yet been completed.
Neil Carmichael (Stroud) (Con)
4. What progress he has made on the implementation of the Heseltine review.
Martin Vickers (Cleethorpes) (Con)
6. What progress he has made on the implementation of the Heseltine review; and what assessment he has made of the potential effect of implementation on the economy of northern Lincolnshire and the Humber.
The Deputy Prime Minister
The Government have confirmed that they will implement Lord Heseltine’s recommendation that economic development spending should be devolved to local areas through a single pot. Alongside the Budget, we published more details on the creation of that single local growth fund and growth deals. The next step is an announcement on the size and content of the fund as part of the spending round. Like all local enterprise partnerships, the Humber’s has the chance to show its ambition by coming up with a strong strategic economic plan to compete with others for that single local growth fund, and attain the wider freedoms and flexibilities available.
Neil Carmichael
Does the Deputy Prime Minister agree that the measures he has just announced, coupled with the industrial strategy and banking reform, are all about ensuring that we can have good, successful firms in our local areas that not only generate jobs but, above all, get access to export markets, and that the Heseltine review paves the way for exactly that?
The Deputy Prime Minister
I strongly agree with my hon. Friend. As we clear up the monumental mess left by the Labour party, we are having to rebalance the British economy and, in particular, to rebalance the overreliance on public sector employment in significant parts of our country towards a much more diverse approach in which private sector jobs growth is restored to health as well. That is why I am delighted that we have presided over the creation of one and a quarter million new jobs in the private sector in the past three years.
Martin Vickers
I welcome the Government’s initiatives and investment in the Humber region, and in northern Lincolnshire in particular, and the personal involvement of Lord Heseltine. However, our business community, particularly on the south bank, would welcome further opportunities to discuss future potential with Ministers. Will the Deputy Prime Minister assure me that he, or one of his team, will visit to ensure that that happens?
The Deputy Prime Minister
I know that my colleagues, notably my right hon. Friends the Secretaries of State for Communities and Local Government and for Business, Innovation and Skills are in constant dialogue with leading figures from local enterprise partnerships around the country in order to explore ways in which we can work together. The city deals, the creation of local enterprise partnerships, the enterprise zones, the single pot flowing from the Heseltine recommendations and the industrial strategy promulgated by my right hon. Friend the Business Secretary all feed into that.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
Will the Deputy Prime Minister join me in backing the NEvolution campaign launched yesterday by the north-east’s newspapers, which calls on the Chancellor to devolve more funding and spending decisions to regions like the north-east, as recommended by Lord Heseltine?
The Deputy Prime Minister
Yes, I strongly endorse that. In fact, we have already announced that we are going to implement the vast majority of the Heseltine recommendations—81 of the 89. That really will be a significant moment, when we break from that long, long tradition, which has prevailed under Governments of all persuasions, of over-centralisation in England. In addition to the radical moves—the city deals, the LEPs and the devolution of business rates—it will leave this country significantly more devolved by the end of this Parliament than we found it at the beginning of the Parliament.
Nick Smith (Blaenau Gwent) (Lab)
Does the Deputy Prime Minister agree that the regional growth fund is being spent far too slowly and that that is leading to delays in investment and jobs across the country?
The Deputy Prime Minister
To be fair, that might have been a legitimate criticism at the very beginning of the process, as the programme was set up. The programme is now moving at an impressive pace, and the vast majority of any delays are not generated in Whitehall or in government but result from the pace of the commercial decisions taken by the recipients. When my right hon. Friends at the Department for Business, Innovation and Skills surveyed the beneficiaries of the regional growth fund, they found that more than 90% said that they were happy with the pace at which it was operating.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
T1. If he will make a statement on his departmental responsibilities.
The Deputy Prime Minister (Mr Nick Clegg)
As Deputy Prime Minister, I support the Prime Minister on a full range of Government policy initiatives. Within Government, I take special responsibility for the Government’s programme of political and constitutional reform.
Meg Hillier
The proposed new Bill on lobbying tackles the low-hanging fruit—that is, the lobby companies that we know about. Will the Deputy Prime Minister tell us what it will do to record lobbying contact elsewhere, such as that which takes place on horseback in places like Oxfordshire?
The Deputy Prime Minister
We will come forward with our proposals shortly, but the Parliamentary Secretary, Cabinet Office, my hon. Friend the Member for Norwich North (Miss Smith), explained our intentions. Lobbying is a perfectly legitimate activity to allow people to explain to decision makers what the consequences of their decisions could be, and we should not malign a perfectly legitimate activity. It just needs to be made as transparent as possible, particularly when lobbying is aimed at those in government who are making important decisions that affect many people in this country.
Harriett Baldwin (West Worcestershire) (Con)
T2. The Deputy Prime Minister has made it clear that he is passionate about devolution. Has he had a chance to read the recommendations in the report by his Department’s McKay commission, which address the offsetting consequences of devolution? In this Parliament in Westminster, a lot of legislation is England-only but can be voted on by MPs from Scotland, Wales and Northern Ireland. Has he had a chance to see those recommendations?
The Deputy Prime Minister
It is a very important, thorough and thoughtful report that comes up with some ingenious proposals for how the mechanics of this place could be reorganised to reflect votes that take place on issues that affect only English constituencies. Of course, it requires careful consideration and we are giving it that. It does not endorse some of the more radical proposals for an English Parliament and so on, but is all about the internal mechanics of this place and we will give it all due consideration.
Ms Harriet Harman (Camberwell and Peckham) (Lab)
Will the Deputy Prime Minister confirm that under his Government, patients in accident and emergency are having to wait longer than at any time for nine years?
The Deputy Prime Minister
Of course, I too saw the statistics from the King’s Fund and others this morning about accident and emergency waits. They are serious and we need to tackle them. More than 1 million more people are going to accident and emergency than was the case previously. That is for some long-term reasons, as the report acknowledges: an ageing society, the lack of proper co-ordination between social and health authorities and, of course, the disastrous consequences for out-of-hours care of the GP contract, which was so badly bungled by the Labour party. I am pleased to be able to tell the right hon. and learned Lady that the very latest statistic—this is a tribute to everyone working in accident and emergency in our NHS—shows that this is now the fifth consecutive week in which we have met the target of 95% of A and E patients being seen in less than four hours.
Ms Harman
I think that answer is complacent. The truth is that there is a crisis in the national health service in the accident and emergency departments. The coalition has been in government for three years and this is happening on the Government’s watch and because of what they are doing: wasting billions of pounds on top-down reorganisation, axing thousands of nursing jobs and cutting social care. Is that not exactly what happened before to the NHS under the Tories? It is happening again, only this time the Lib Dems are helping the Tories to wreck the NHS.
The Deputy Prime Minister
The right hon. and learned Lady says that I am complacent, but we have a laboratory experiment of what happens to the NHS when Labour is in charge: let us look at what happened to the NHS and to A and E waiting times in Wales, where Labour is in charge. Let us not forget that in Labour-run Wales, the last time that A and E targets were met was in 2009. We have met them for the past five weeks.
Jonathan Lord (Woking) (Con)
T4. May I press the Deputy Prime Minister a little further on the McKay report? I believe that it is crucial that the Scottish people have a clear sense of direction as to where the Government will come out on these matters. The English people deserve a fairer settlement and the Scottish people deserve to know where we are going on this.
The Deputy Prime Minister
I hope I have made it clear that everybody, north or south of the border and in whatever part of the United Kingdom, should be in no doubt that this coalition Government will do whatever we can remorselessly to devolve power not only to Cardiff and Edinburgh, as we have done, or through discussions about further devolution in Northern Ireland, but within England. That is what the economic reforms I have talked about are all about.
Huw Irranca-Davies (Ogmore) (Lab)
T3. Delivering on what the coalition agreement says on Lords appointments will, I understand, require 200 additional peers in the House of Lords, at a cost of £26.2 million by the end of this Parliament. Is that a price worth paying for unpopular policies being railroaded through the other place?
The Deputy Prime Minister
The hon. Gentleman is getting a little carried away, as ever. Labour has a constant, rather unedifying record of stuffing the other place with Labour appointees. As I said, if only the hon. Gentleman had given us support for giving the British people a say in who should go to the House of Lords, we would not be stuck with this old-fashioned, archaic way of making appointments, which all party leaders are stuck with for the time being.
Amber Rudd (Hastings and Rye) (Con)
T5. The coalition was formed to deal with the disastrous economic legacy left to us by the last Government. Was the Deputy Prime Minister won over by the proposals made by the shadow Chancellor yesterday, which—as always from Labour—added up to only one thing: borrow, borrow, borrow?
Mr Speaker
Order. We will not bother with that one. The problem with it is that it was about the policy of the Opposition. Questions must be about the policy of the Government; that is the point of Question Time. The clue is in the title.
Jessica Morden (Newport East) (Lab)
T6. The Government’s commission on social mobility has warned of rising child poverty, and has said that the Government are not doing enough. What is the Government’s response?
The Deputy Prime Minister
We are doing many things, but one of the principal objectives that we have been pursuing over the past three years is making sure that resources help children in the early years, when they make the biggest difference. That is why we are the first Government to deliver 15 hours of pre-school support to all three and four-year-olds; the first Government ever, as of this September, to deliver 15 hours of child care and pre-school support to two-year-old toddlers from the lowest-income families; and the first Government ever to introduce a pupil premium worth £2.5 billion of additional support to children from the lowest-income families. That is the way to break the generational transmission of deprivation and educational under-achievement that has blighted this country for too long.
John Stevenson (Carlisle) (Con)
T8. Does the Deputy Prime Minister agree that the political fee paid by trade union members should not automatically go to one party, and that trade union members should have the opportunity to decide for themselves which party that fee should go to?
The Deputy Prime Minister
The whole issue of opt-in and opt-out for trade union members and of donations from the trade union movement, which is now pretty well single-handedly bankrolling the Labour party, has of course come up in the cross-party talks on party funding, which unfortunately have proved somewhat elusive. One of the measures that we want to bring forward —it does not apply to trade unions alone—relates to the way in which a number of campaign groups, be they trade unions, animal welfare groups, tactical voting groups, rural campaign groups, religious groups or individuals, spend money to determine the outcome of campaigns in particular constituencies. At the last election, those major groups and individuals spent £3 million—a full 10% of what the major parties spent. We want to make sure that this increasingly important type of campaigning is fully transparent and is not allowed to distort the political process. That is what proposals that we will come forward with soon will do.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
T7. Mr Speaker, I know that you know about the 10th “Audit of Political Engagement” report, just published by the Hansard Society. Is the Deputy Prime Minister conscious of and worried about the steep decline in political participation, particularly in the last three years, under this coalition Government? This is the first time that the percentage of people who are certain to vote has gone below 50%; it is now 43%. For young people between 18 and 25, it has fallen to just 12%. What will he do about that?
The Deputy Prime Minister
The first thing that I would like to do is try to persuade the hon. Gentleman and his colleagues to join me in reforming our clapped-out political system. If his party had supported democracy for the House of Lords, would clean up party funding, and had given wholehearted support to electoral reform, perhaps he would have a leg to stand on when it came to greater political participation.
Tim Farron (Westmorland and Lonsdale) (LD)
T10. Six hundred Afghan interpreters have put themselves at serious personal risk by having loyally supported British security services in Afghanistan. They could be in even greater danger once our services leave. Will my right hon. Friend back the campaign led by our noble Friend Lord Ashdown to ensure that we honour the Afghan interpreters and offer them and their families secure refuge in this country?
The Deputy Prime Minister
I strongly agree with my hon. Friend, and I am sure that he speaks for many Members across the House. We do, of course, have a moral duty—a duty of care—to those who have risked life and limb for British servicemen and women on the front line in Afghanistan. We will make an announcement later today on those being made redundant as part of our ongoing draw-down. In short, we will offer a very generous package of support for those who wish to stay in Afghanistan and are able to do so. We will also make sure that those who have been on the front line, have served for 12 months and are now being made redundant have the opportunity to resettle in this country, as well as those who are being intimidated, when resettlement is the only option to guarantee their safety. We owe that to them, and we will do it.
Steve Rotheram (Liverpool, Walton) (Lab)
T9. Given the parlous state of the Lib Dems, will the Deputy Prime Minister give hope to his party by announcing the date of his resignation, or hope to the country by announcing the date on which he will dissolve the coalition?
The Deputy Prime Minister
The hon. Gentleman’s questions are always so challenging. No and no.
Jesse Norman (Hereford and South Herefordshire) (Con)
T11. Per pupil funding for schools in Herefordshire has long been among the lowest in the country, although it has risen, I am pleased to say, since 2010. Does my right hon. Friend share my view that the pupil premium should be targeted on a wider range of deprivation than just free school meals?
The Deputy Prime Minister
I am delighted that my hon. Friend is as keen an advocate as I am of the pupil premium, which will pay long-term dividends in enhancing social mobility and greater fairness in this country. We consulted widely on what criteria we would use for the allocation of the money, and although no criterion is perfect, the only available one that is workable for teachers and head teachers and recognisable to parents—this is the response we got overwhelmingly from schools throughout the country—is free school meals. That includes not just those who receive free school meals now, but those who have received free school meals in the previous six years.
Nick Smith (Blaenau Gwent) (Lab)
T13. How many more peers does the Deputy Prime Minister expect to be appointed by the time of the 2015 general election?
The Deputy Prime Minister
We will make those announcements—of course, this involves all political leaders—in due course. I am sure the hon. Gentleman will be the first to know.
Jeremy Lefroy (Stafford) (Con)
T12. The International Development Committee, of which I am a member, says in a report today that smallholder farmers have a vital role to play in global food security. Will the UK Government champion their vital role as food producers, job creators and protectors of the environment?
The Deputy Prime Minister
Absolutely; the hon. Gentleman makes an important point that it is the smallholding farmers who in many ways are the backbone of the rural economies in which they operate and very much hold the keys to the future prosperity of the countries in which they are located. At the Rio summit last year we made a significant announcement of additional DFID funding for smallholding farmers, and I know that the projects included under that programme are already proving to be a terrific success.
Andrew Gwynne (Denton and Reddish) (Lab)
Unlike the Labour Government, who were always in a minority in the other place, the current Government have a de facto majority of 68, yet have still managed to suffer 71 defeats, and counting. Is that an illustration of how bad coalition policy is, or is it merely another example of why the Deputy Prime Minister needs to stuff the other place with ever more peers?
The Deputy Prime Minister
I will send to the hon. Gentleman the figures for the stuffing that took place under the Labour Government. I repeat that if he wants to join me in advocating lasting, meaningful, democratic reform of the House of Lords, why on earth did he not support it when he had a chance?
Martin Horwood (Cheltenham) (LD)
The crisis in emergency medicine recruitment and retention reveals failures in work force planning and training dating back many years, but will my right hon. Friend insist now that the Department of Health look at issues such as pay and overseas recruitment in an attempt to tackle the crisis and prevent pre-emptive measures such as the downgrade of accident and emergency services in Cheltenham?
The Deputy Prime Minister
I certainly pay tribute to my hon. Friend for representing his constituents as fiercely as he does on issues such as the A and E department in his local area. This Government will put an extra £12.7 billion into the health service by 2015—a policy of extra resources for the NHS rejected by the Labour party. That includes an increase of 6,000 in doctor numbers, and waiting times and infection rates on the whole are at record low levels. Yes, of course there are issues that need to be dealt with at a local level, but on the whole that is a record of which we can be proud.
Thomas Docherty (Dunfermline and West Fife) (Lab)
Will the Government confirm that when they introduce their Bill on lobbying they will ban Members of the House of Lords from being lobbyists and lobbyists from holding passes to either House?
The Deputy Prime Minister
Some of these matters are for the House authorities and the other place rather than for Government legislation, but we are working flat out to cross the t’s and dot the i’s on this package of legislation, dealing, as I say, with the influence of non-political parties with regard to lobbying and support for campaigns at a constituency level. We will publish those proposals shortly.
Zac Goldsmith (Richmond Park) (Con)
Under the Deputy Prime Minister’s version of recall, an MP could refuse to come to Parliament, could refuse to hold any kind of surgery or see constituents, could switch parties at a moment’s notice, and could even go on a two-year holiday without notice, and would still fail to qualify under his proposals. How will that empower voters?
The Deputy Prime Minister
The hon. Gentleman and I have spoken, and I know that he and the hon. Member for Clacton (Mr Carswell) feel strongly that we should move towards an unqualified Californian approach —a model that is not without its problems given some of the political practices in California. We are trying to strike a balance, and that will be reflected in our final proposals, to give voters and the public a back-stop reassurance that if someone commits serious wrongdoing and they are not held to account, they can be held to account by the public. Equally, we should not introduce a proposal that in effect would become a kangaroo court and a free-for all for everyone simply to take political pot shots at each other.
Graham Evans (Weaver Vale) (Con)
1. What steps the Crown Prosecution Service has taken to improve the conviction rate for rape since 2010.
The Solicitor-General (Oliver Heald)
In the past three years, the conviction rate for rape has continued to increase steadily. In the calendar year 2010, the conviction rate was 59.1%; it then went to 61% and then to 64.3%, which reflects the commitment of the Crown Prosecution Service to robust prosecution of rape offences.
Graham Evans
Does my hon. and learned Friend agree that part of the reason for the increase in conviction rates is the training of specialist prosecutors by the CPS?
The Solicitor-General
Yes, my hon. Friend makes an important point. The Director of Public Prosecutions has led the training of specialist CPS rape prosecutors, 800 of whom have now been trained, and they have done a wide range of units to ensure that they are fully aware of all the ways that it is necessary to prosecute such cases.
Helen Goodman (Bishop Auckland) (Lab)
Some of the victims are children, and one reason why conviction rates are low is the way in which they are treated during the trial process. It is disgusting that small girls are further abused by grown men, being taunted for hours on end as liars. What will the Solicitor-General do about it?
The Solicitor-General
The hon. Lady makes a very important point about the way in which the cases are conducted, and there is a role for advocates and judges in ensuring that cases are dealt with properly. “The Advocate’s Gateway”, a guidance document by the Advocacy Training Council that has had input from the legal profession and the judiciary, has recently been launched. It deals particularly with this issue, and I think it will make a major contribution to the way in which cases are handled.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
Is the Solicitor-General satisfied that the CPS is making timely application for special measures in cases involving young victims in sex offences, and that lessons have been learned from some of the cases that went badly wrong?
The Solicitor-General
Yes; in fact it has been a priority of the Director of Public Prosecutions to ensure that. We can always strive for a better performance, but as the results show, the CPS is making a major effort to tackle the cases effectively.
Mr George Howarth (Knowsley) (Lab)
The Solicitor-General will be aware that in the year up to September 2012, 1,243 sex offences resulted in a caution. Does he agree that it would be helpful to know a lot more about those cases, and to look at how they might impact on the conviction rates and how those offences are dealt with?
The Solicitor-General
Yes, research is important in this area. I sit on a ministerial group on violence against women and girls that is trying to examine these issues, with the help of the voluntary organisations. The right hon. Gentleman makes a good point and I will look into it.
Lisa Nandy (Wigan) (Lab)
Given the recent appalling cases involving young victims and witnesses, does the Solicitor-General not agree that the damage done to those young people as they go through the court process is far too great? Is there not a sense of urgency to the issue? This simply cannot wait. Young people should not be put through such appalling damage during the court process when they have already suffered such distress and harm.
The Solicitor-General
Yes, I agree. It is right to bear in mind the fact that all those in the legal profession, including the judges, are concerned about the issue too, because what has been happening has been wrong. I agree that the matter is urgent. I welcome “The Advocate’s Gateway”, which is a useful initiative to which all parties have signed up. It should make a major difference. Proper case management is the key.
Kerry McCarthy (Bristol East) (Lab)
2. What recent discussions he has had with the Secretary of State for the Home Department on the use of community resolution orders to reduce offending.
The Solicitor-General
Yes, it is in here somewhere.
None. [Laughter.] No—there is a bit more: the Crown Prosecution Service is not involved in the use of community resolutions, which are out-of-court disposals that enable a police officer to deal proportionately with appropriate offences in a timely and transparent manner.
Mr Speaker
I must say that the initial answer was the shortest that I have ever heard, especially from a lawyer.
Kerry McCarthy
There is real concern that the orders are being used increasingly to resolve—or supposedly resolve—domestic violence incidents. In 2012, nearly 2,500 of the orders were issued rather than cases being put before the CPS for possible prosecution. Does the Minister share my concern that the orders may be being used as an easy disposal, rather than taking domestic violence seriously?
The Solicitor-General
The point to make is that the decisions are made by officers at the time. They are not orders, but decisions made when there has perhaps been an apology or some reparation. In cases of domestic violence, that would be inappropriate. The guidance is that the resolutions should not be used for such cases. Obviously, I will mention the matter to the Home Office, which is the place to direct the question.
Mr Philip Hollobone (Kettering) (Con)
I declare an interest as a special constable. Presumably, the Solicitor-General should be interested in liaising with the Home Office about the most serious offence that a police officer could deal with under a community resolution order, rather than its going through the justice system. Will he assure the House that he will establish that threshold with the Home Department?
The Solicitor-General
As my hon. Friend will know from his background in the special constabulary, community resolutions are designed for dealing with low-level matters, when the person involved does not have previous convictions and it is possible to reach an agreement between the parties. Clearly, any serious offence should be dealt with in a different way.
Andrew Griffiths (Burton) (Con)
3. What recent discussions he has had with the Director of Public Prosecutions about the Government’s approach to tackling abusive or libellous communications sent via social media.
The Attorney-General (Mr Dominic Grieve)
I have held discussions with the Director of Public Prosecutions in relation to the CPS public consultation on the interim guidelines on prosecuting cases involving communications sent via social media. The public consultation closed on 13 March 2013 and the final guidelines will be published shortly. I would like to emphasise that libel itself is not a criminal matter unless it is grossly offensive, indecent, obscene, menacing or threatening.
Andrew Griffiths
My constituent Jordan Agar died tragically the day after his 16th birthday in a motorbike accident. Tragically, his mother was then contacted by a fake Facebook profile set up in Jordan’s name with messages such as “Don’t worry mum, I’m not dead. I’ve just run away.” When apprehended, the 21-year-old culprit was given a caution; having once remained anonymous on the internet, he then remained anonymous under the law. What can be done to make sure that mothers such as Jordan’s never have to go through such a thing again?
The Attorney-General
I am troubled to hear my hon. Friend’s story. Obviously, it is impossible for me to comment on an individual case. What is clear is that the interim guidelines, already in existence, provide, particularly under the Malicious Communications Act 1988, clear grounds on which such a message could be prosecuted because it is offensive, shocking or disturbing and harasses the person who receives it. The harassment aspect would normally take it straight into the criminal domain. The guidelines are designed to strike a balance. Sometimes things that are merely offensive will not be criminal, but what my hon. Friend described seems to me to be well on the wrong side of the line.
Keith Vaz (Leicester East) (Lab)
Social media are also being used by those involved in propagating terrorist activity. Is the Attorney-General to be part of the new taskforce? If not, what discussions is he having with social media providers about the use of social media for those purposes?
The Attorney-General
First, I advise any Minister, Cabinet Committee or, indeed, taskforce if that advice is required. Secondly, as I suspect the right hon. Gentleman knows, I have had quite a lot of involvement in considerations of whether contempt of court, for example, is taking place, or whether issues may arise in respect of misuse of the internet. I can be in a position to help my colleagues in Government on all those things, but the policy lead will obviously lie elsewhere.
Jeremy Corbyn (Islington North) (Lab)
Obviously, libellous or criminal messages on social media are illegal and wrong, and action can be taken on them. However, can the Attorney-General assure us that he will be cautious about proposing excessive controls on social media, which are an important form of free expression for many people of different opinions and views who want to communicate with each other? It is the modern form of communication, particularly for younger people in our society.
The Attorney-General
Yes. Although the final guidelines will, I hope, be useful, I refer the hon. Gentleman to the interim guidelines published by the DPP. Those make it clear that there is a distinction that one should try to draw. Such material may be, for example,
“Satirical, or iconoclastic, or rude comment”
or
“the expression of unpopular or unfashionable opinion”
where no action should be taken, even if it is offensive, shocking or disturbing. Equally, there will be cases where an individual is specifically targeted, or where the activity may amount to a breach of court order, or may involve threats of violence or material that is
“grossly offensive, indecent, obscene or false.”
In those circumstances, action will be taken. I assure the hon. Gentleman that within the Crown Prosecution Service there is a strong understanding of the need to preserve the right to freedom of expression.
Rosie Cooper (West Lancashire) (Lab)
4. What recent discussions he has had with Her Majesty’s Treasury on the funding of the Serious Fraud Office.
The Attorney-General (Mr Dominic Grieve)
The 2015-16 spending round is in progress. I wrote to the Chief Secretary to the Treasury in April and discussions are continuing. The SFO’s funding settlement for 2015-16 is on track to be agreed by 26 June.
Rosie Cooper
The Serious Fraud Office is reviewing whether it should investigate allegations that UK-based oil companies were engaged in a LIBOR-style rigging of oil prices. If the SFO does decide to investigate, will it be able to do so within its budget this year of just £30 million?
The Attorney-General
The Government have made it clear that the director of the SFO should never have to turn down a case on the basis of cost. Any allegations of the type described, if brought to the SFO’s attention, are assessed within the context of its remit to investigate fraud, bribery and corruption. If there were a need for further resources outside the envelope in which the SFO is currently operating, then the director could come to me and I could go to the Treasury to seek the necessary funding.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Will the Attorney-General consider the possibility of returning to the victims of such fraud, corruption and crime any proceeds that the Serious Fraud Office is able to extract?
The Attorney-General
My hon. Friend raises an important issue, but ultimately it is rather outside my remit. There are circumstances in which compensation can be paid to victims of crime, including from assets that may have been recovered. The Crown Prosecution Service and the SFO will operate according to the rules that are laid down.
Emily Thornberry (Islington South and Finsbury) (Lab)
The new director of the Serious Fraud Office has said that we should have a sensible debate about the introduction of the new offence of corporate criminal liability, so that companies could be prosecuted for fraud, as they are under the Bribery Act 2010. Does the Attorney-General agree that it is a good idea to have such a debate, or does he agree with some of his colleagues that instead of being built on, the Bribery Act should be watered down?
The Attorney-General
If I may say first, there is no question, as far as I am concerned, of the Bribery Act being watered down. It is true that the interpretation of the Act has at times given rise to difficulties, including unnecessary ones for businesses in understanding what it requires of them, so an educational process may be required.
On changing the rules on criminal liability, I am the first to recognise that it is an important issue and one that will obviously require major debate and consideration in this House. There are compelling arguments for why that should happen, but equally perfectly sound arguments have also been made about why it should not happen.
Roger Williams (Brecon and Radnorshire) (LD)
Has the Serious Fraud Office maintained close and effective working relationships with the fraud departments of the Home Office so that those smaller cases reported to Action Fraud that highlight more widespread and more serious frauds can be prosecuted on behalf of the individuals concerned?
The Attorney-General
I think there is widespread recognition that smaller fraud, which falls outside the SFO’s remit entirely, has long been a Cinderella area for law enforcement. The economic crime command was set up in the National Crime Agency precisely to try to ensure that smaller fraud is dealt with better at a regional policing level and in order to put in place structures to enable that to happen more effectively. It is a subject of legitimate anxiety across the House that fraud problems faced by constituents often cannot be dealt with adequately. The SFO is involved with the economic crime command and sits on the economic crime co-ordination board, so it can provide its professional input.
Paul Flynn (Newport West) (Lab)
Why do the Government move at the speed of a striking cobra in further impoverishing the already poor with the bedroom tax, and why, in the case of reforming the parasitic incubus on the body politic of lobbying, do they move at the speed of an arthritic sloth?
The Deputy Prime Minister (Mr Nick Clegg)
On both counts, of course, we at least have moved, unlike the Labour Government, who for 13 years ducked any meaningful reform of the welfare system, which in our view should be guided by the simple principle of making sure that work always pays. We also want to make sure that the details of the provisions that we are going to introduce to govern the influence in the political process of non-political and third parties are properly crafted, and we will publish them very shortly.
Mr Andrew Turner (Isle of Wight) (Con)
What is a lobbyist? WRAP—Wight Residents against Asphalt Plant—is a group of constituents who are against an asphalt plant on the River Medina. Are they lobbyists and would they be required to register?
The Deputy Prime Minister
I stress again that we should not regard the word “lobbyist” as a bad term. It is a perfectly legitimate activity but, as the Parliamentary Secretary, Cabinet Office, my hon. Friend the Member for Norwich North (Miss Smith) explained earlier, the focus of our attention will be on third party lobbyists who, on a commercial basis, provide lobbying services to an array of different clients.
Kevin Brennan (Cardiff West) (Lab)
The Deputy Prime Minister said several times earlier that all he is prepared to do now on Lords reform is housekeeping measures. When did the scale of his ambition as the greatest constitutional reformer since 1832 reduce to the level of housekeeping?
The Deputy Prime Minister
It was when the hon. Gentleman’s party abandoned its historical commitment to giving the people a say. It used to be the people’s party and now it is the party of privilege all over again.
Mr Peter Bone (Wellingborough) (Con)
The Liberal Democrats used to be the party of minority but, thanks to the courageous leadership of the Deputy Prime Minister, he has just answered questions from the Dispatch Box in parts 1 and 2 of Question Time, with five or six Liberal Democrat Ministers sitting alongside him. Can I say how many Conservative Members want him to continue as Lib Dem leader and Deputy Prime Minister?
The Deputy Prime Minister
I am so stunned by that; I am still trying to work out the barbed comment or intent that must be buried within it. I will take it at face value and thank the hon. Gentleman for what I will take on this occasion to be a compliment.
Anas Sarwar (Glasgow Central) (Lab)
The Government have said that they will increase social mobility by ensuring that children are given
“a healthy start in life”,
by
“improving the child maintenance system”
and by
“making the higher education system more…diverse.”
Does the Deputy Prime Minister believe that the best way of doing that is closing down Sure Start centres, introducing charges for using the Child Support Agency, and trebling university tuition fees?
The Deputy Prime Minister
As I hope the hon. Gentleman recognises, the latest figures—the situation is evolving—suggest that more youngsters from the most disadvantaged backgrounds are going to university than ever before, notwithstanding the controversial changes. I am very proud of the fact that we are the first Government to introduce 15 hours of free pre-school support for all three and four-year-olds; to give two-year-old toddlers from the lowest-income families 15 hours of pre-school support; and to introduce the £2.5 billion pupil premium.
Damian Hinds (East Hampshire) (Con)
Improving social mobility starts with the early years and attainment at school. However, will the Government fully consider the role of developing strength of character and resilience in young people and their potential role in reversing the woeful social mobility of recent decades?
The Deputy Prime Minister
I pay tribute to the hon. Gentleman, who is passionate about this issue. I read with great interest the papers from the conference on character he hosted back in February. It is a slightly amorphous term, but none the less an important one to grapple with as a factor in determining how well children do, and particularly in determining how well they do in, as it were, escaping the circumstances of their birth and realising their aspirations. I hope that a number of the early years policies I have alluded to, and reforms in the welfare and tax system that ensure that work always pays and that people in low-income work retain more of the money they earn, will help to boost social mobility in the long run.
Jim Shannon (Strangford) (DUP)
To prevent postal and proxy vote fraud, what discussions has the Minister had with the Northern Ireland Assembly and the Electoral Commission in Northern Ireland to learn from the steps that the Assembly has taken to stop such fraud?
The Parliamentary Secretary, Cabinet Office (Miss Chloe Smith)
I would be happy to have further discussions with the hon. Gentleman on those matters. I can confirm that the electoral registration transformation programme seeks to work with all appropriate bodies throughout the system to combat fraud. He makes an important point on the integrity of the electoral system. We are committed to combating fraud and the perception of fraud wherever it arises.
Andrew Selous (South West Bedfordshire) (Con)
Will the Minister agree to consider the huge fees, often of up to £20,000, paid to returning officers, who are generally highly paid chief executives of councils? That is a huge amount of money and the Government are looking to save money. I believe that that should be part of political reform.
Miss Smith
I thank my hon. Friend for his question—I know he has probed that issue many times before. Returning officers are entitled by statute to recover expenses incurred, as set out in the order made for each poll. As my hon. Friend will know, through the Electoral Registration and Administration Act 2013, we have put in place a facility whereby some or all of the fee payable can be withheld in the event of unsatisfactory performance. I am sure he, like the Government, will want to see that new system bed in, after which we ought to return to the issue.
Points of Order
Mr David Winnick (Walsall North) (Lab)
Would it be appropriate to record the fact that, 100 years ago today, Emily Davison was very seriously injured while campaigning for the right of women to vote? As a result of those injuries, she died four years later. In praising her, should we not also record all who campaigned, including the suffragettes who went to prison and were forcibly fed, simply for the right to have the same vote and democratic rights as men? As far as you know, Mr Speaker, has there been any apology at all from the two political parties that did their best at the time to deny half the adult population their democratic right?
Mr Speaker
It was perfectly reasonable for the hon. Gentleman to draw attention to this very significant anniversary, as he has just done. I think I am right in saying that, in recognition of the significance of the anniversary and of the great contribution to public life of Emily Wilding Davison, an event is to take place in Westminster Hall early tomorrow evening, as a result of the prodigious last-minute efforts of the hon. Member for Islington South and Finsbury (Emily Thornberry), of which I was kept well informed. In fact, it is my intention to join in on the occasion.
So far as the second part of the hon. Gentleman’s point of order is concerned, I cannot say I am aware of any of the matters he describes, but it would be unseemly of me to comment further.
Dr Julian Lewis (New Forest East) (Con)
On a point of order, Mr Speaker. When the Prime Minister was asked yesterday whether there would definitely be a vote in this House before arms were supplied to the opposition in Syria, he replied that
“Parliament has that opportunity whenever it wants to.”—[Official Report, 3 June 2013; Vol. 563, c. 1241.]
Given that some of us suspect a decision to supply arms to the rebels in Syria might be taken during the recess, have you, Mr Speaker, had any indication from, or via, the usual channels that the Prime Minister would propose to recall Parliament, so that there could be a vote before such a serious step was taken?
Mr Speaker
I can say to the hon. Gentleman that I have received no indication of any plans one way or the other so far as Her Majesty’s Government are concerned. In the event that the situation the hon. Gentleman describes—which is, so far, hypothetical—were to arise, I would be obliged to deal with the matter under the current terms of the relevant Standing Order governing recall, a Standing Order with which I fancy the hon. Gentleman either is, or will shortly become, familiar.
More widely on the merits of the matters being debated, having known the hon. Gentleman for 30 years this October, I know what an incredibly persistent woodpecker he is and I feel sure that he will return to the matter at every conceivable opportunity.
Jeremy Corbyn (Islington North) (Lab)
Further to that point of order, Mr Speaker. Would I be right in thinking that you could recall Parliament only at the request of the Prime Minister, and not necessarily as a result of a submission made by a delegation of Members from all parties? This matter needs to be cleared up well before the summer recess, in the event that the Government decide to send arms to Syria.
Mr Speaker
The hon. Gentleman’s understanding is broadly correct. Specifically, the requirement of the Standing Order is not that the request has to be made by the Prime Minister, but that it does have to be made by one of Her Majesty’s Ministers. In so far as the hon. Gentleman is highlighting this point as evidence of his belief that the Standing Order is unsatisfactory and a constraint on Parliament, I note very much what he says. It is what it is, and it will be up to Members, if they judge it necessary, to deploy their collective wits to try to ensure an opportunity for Parliament to debate and vote, if that is what they seek. I hope that that is helpful; we will have to leave it there for today.
Energy Bill
15:59 - The House divided: - Ayes: 267 / Noes: 290 - Question accordingly negatived.
17:51 - The House divided: - Ayes: 245 / Noes: 312 - Question accordingly negatived.
18:58 - The House divided: - Ayes: 396 / Noes: 8 - Question accordingly agreed to.
Mr Tim Yeo (South Suffolk) (Con)
I beg to move amendment 11, page 1, line 4, after ‘ensure’, insert—
‘that a decarbonisation target range is set and that’.
Mr Speaker
With this it will be convenient to discuss the following:
Amendment 12, page 1, line 5, leave out
‘a decarbonisation target range is set, that’
and insert—
‘such a target range is set’.
Amendment 13, page 1, line 8, leave out ‘may’ and insert ‘must’.
Amendment 14, page 1, line 11, at end insert—
‘(4) Subject to section 2(1) the decarbonisation level must not exceed the level deemed consistent with a low-carbon trajectory as advised by the Committee on Climate Change’.
Amendment 15, page 2, line 2, leave out from
‘and the first decarbonisation order may not’
to ‘Climate Change Act 2008’ and insert—
‘a decarbonisation order must be made by 1 April 2014’.
Amendment 16, page 2, line 6, leave out ‘A’ and insert—
‘Subject to section 2(1), a’.
Amendment 17, in clause 2, page 2, line 30, leave out from ‘The following matters’ to ‘target range’ and insert—
‘Before exercising the power to make a decarbonisation order the Secretary of State must obtain and take into account the advice of the Committee on Climate Change.’.
Amendment 18, page 2, line 32, leave out ‘The matters are’ and insert—
‘In providing its advice to the Secretary of State the Committee on Climate Change must take into account the following matters’.
Amendment 19, page 2, line 46, at end insert—
‘(3) As soon as is reasonably practicable after giving its advice to the Secretary of State, the Committee must publish that advice in such manner as it considers appropriate.
(4) If in making a decarbonisation order the Secretary of State makes provision different from that recommended by the Committee, the Secretary of State must, on making the order, publish a statement setting out the reasons for that decision.’.
Amendment 20, in clause 3, page 3, line 2, leave out from ‘a report setting out’ to the end of subsection and insert—
‘and publish a delivery plan setting out proposals to achieve the duty in section 1 to ensure that the decarbonisation target range is not exceeded.’.
Government amendments 51 and 70.
Mr Yeo
I draw the attention of the House to my entry in the Register of Members’ Financial Interests, in particular to my interests in the energy industry. In doing so, I emphasise, as I have done before, that my views on climate change and on the need for Britain to move more swiftly to a low-carbon economy and to cut its dependence on fossil fuels were formed two decades ago when I had ministerial responsibility for this area of policy.
I have not changed these views at any time since and have repeated them publicly and privately on many occasions throughout the past 20 years. My views have never been influenced at any time or in any way by my financial interests, all of which were acquired after I left the shadow Cabinet in 2005. That was 12 years after I accepted the overwhelming scientific consensus on this subject and began campaigning for a more urgent response to the challenge of climate change. Various bloggers, columnists and others, including one or two of my hon. Friends, who imply otherwise and who ignore the scientific consensus, invariably overlook my strong and consistent support for nuclear power, which is a low-carbon technology that should be part of Britain’s energy mix.
I am grateful for this opportunity to debate amendment 11, which stands in my name and the name of hon. Members from most parties. It is based on a unanimous recommendation made last July in the report of the Energy and Climate Change Committee on the draft Energy Bill. I am glad to say that the Government accepted many of the Committee’s recommendations, and by doing so materially improved the Bill, and I congratulate my right hon. Friend the Secretary of State and his team on their response to our report and on the outcome of their negotiations with the Treasury on a range of issues, including the levy control framework.
For a variety of reasons, however, the need for the amendment is even greater now than when my Committee’s report was published. First, despite some positive signs on the Government’s support for low-carbon electricity generation, the publication of the gas strategy on the very day of the autumn statement confused many investors. The possibility that the Government might sanction 37 GW of new gas-fired generation capacity rests uneasily with their acceptance two years ago of the fourth carbon budget, which covers the period 2023 to 2027, and raises the fear that the purpose of next year’s review of the budget is to water it down and weaken the incentives for low-carbon investment.
John Robertson (Glasgow North West) (Lab)
As a member of the Energy and Climate Change Committee, I want to compliment the hon. Gentleman on his chairmanship. He has done an excellent job. Does he agree that unfortunately the Government have dragged their feet over the Energy Bill? They did not give us enough time to scrutinise it. The Bill then disappeared for a while and came back at short notice. Does this smack of a Government who are putting their heart and soul into energy?
Mr Yeo
It is certainly true, as the hon. Gentleman says, that we waited a long time for the draft Energy Bill. I think that the industry, the non-governmental organisations and the academic world were all hoping to see it appear a lot earlier than last summer. Our Committee was given a very limited period—about half the time normally given to Select Committees to comment on a draft Bill. We completed our work—with great assistance not just from my colleagues on the Committee, but from the staff—in about six weeks. Having received our recommendations at the end of July, we waited another five months before the actual Energy Bill was published, although I recognise that some of that period was used in the negotiations on which I have already congratulated the Secretary of State. The Public Bill Committee stage was completed in the first week of February, however, and we have now waited a further four months to get to Report, so the matter has not been conducted with the urgency that I think the needs of the situation required.
The understandably envious glances cast across the Atlantic by the Treasury at the transformation of the US gas market in the wake of the exploitation of shale gas have not passed unnoticed. Not surprisingly, there are now doubts in the minds of many prospective investors about the depth of the Government’s commitment to decarbonising electricity generation.
Incidentally, the Energy and Climate Change Committee was one of the first bodies to urge the Government, more than two years ago, to approve more exploration and testing to establish the scale of Britain’s recoverable shale gas reserves. If our dependence on imported gas can be cut and if consumers can be partially protected against fluctuations in international gas prices, which have been the main cause of the rise in domestic energy prices in the last few years, that is wholly to be welcomed. However, my Committee also warned, in a more recent report on shale gas, that it would be rash to base energy policy on the assumption that Britain will soon be a major shale gas producer. The opposition to exploring for shale gas in Sussex, which is already emerging, is a foretaste of the battle for public opinion, which must be won before domestic production of shale gas on even a modest scale can occur. The case for a diversified energy mix is therefore as strong as ever.
Kerry McCarthy (Bristol East) (Lab)
What the hon. Gentleman has just said exactly echoes what businesses in my constituency are telling me. The lack of certainty and the suggestion that the Government will now delay setting targets until 2016 mean that businesses simply do not know within which parameters they are operating. They do not know whether they should go ahead and invest in the technology.
Mr Yeo
I agree with the hon. Lady and will develop that very point.
The element of perceived political risk is leading investors to seek higher returns from their investments in the UK energy market. Higher returns to investors mean higher prices for consumers. Amendment 11 directly addresses these issues. By itself, it would not immediately alter the low-carbon pathway on which the Government have already embarked, most notably in its acceptance of the fourth carbon budget. However, the prospect of the fourth carbon budget being watered down in next year’s review is simply another unwelcome uncertainty. The amendment would remove that uncertainty by requiring the Secretary of State to set, no later than 1 April 2014, a decarbonisation target for 2030 for electricity generation.
Mr John Redwood (Wokingham) (Con)
But will my hon. Friend concede that if we put up more wind farms, we would also have to build gas-fired power stations as back-up because the wind might not blow? That would be an awful lot dearer than just building the gas stations. How much is he planning to add to people’s electricity bills?
Mr Yeo
I recommend that my right hon. Friend look at the latest report from National Grid, which shows that the amount of back-up required for wind farms is extraordinarily low. More importantly, on the broader point about costs, I am sure he will be aware—because he takes a close interest in these matters—that nothing in the amendment would affect the cost of electricity between now and 2020 because the support for low-carbon technologies during that period is capped by the levy control framework. The amendment would have no impact on electricity prices for consumers for the next seven years.
I am sure that my right hon. Friend also takes a close interest in what electricity prices will be in the 2020s, and it is theoretically possible that approving this amendment could lead to higher prices during that period. That would depend heavily on an assumption about what gas prices will be doing in the 2020s, and I would not be confident about making such a forecast. If he is really concerned about the cost to consumers—a concern that I share—he should address his attention in the short term to the Treasury, which has imposed a minimum floor price for carbon. That will have the effect of raising electricity prices before 2020. It is an imposition that applies only in the United Kingdom and therefore puts us at a competitive disadvantage with the rest of the European Union. I hope he will join me in making continued representations to the Treasury to drop that policy.
As currently drafted, the Energy Bill gives the Secretary of State a power to set a decarbonisation target for 2030, but it does not compel him to do so. It also prevents him from exercising that power before 2016. Suggestions that the amendment would force him to set the target at 50 grams per kWh in 2030 are mistaken. It would merely require him to set it in accordance with advice received from the Committee on Climate Change. There is nothing in the amendment that would require him to set a particular figure. If the Committee were to recommend a figure higher than 50 grams per kWh, the Secretary of State would have to heed that advice. If he did not do so, he would have to explain why.
The Committee on Climate Change itself would not have a completely free hand in determining its advice to the Government. It would still have to take account of all the matters referred to in clause 2(2). I remind the House of five of those key points. The Committee would have to take account of
“scientific knowledge about climate change…technology relevant to the generation and storage of electricity…economic circumstances, and in particular the likely impact on the economy and the competitiveness of particular sectors of the economy…fiscal circumstances, and in particular the likely impact on…public borrowing”
and
“social circumstances, and in particular the likely impact on fuel poverty”.
Mr Peter Lilley (Hitchin and Harpenden) (Con)
My hon. Friend began by saying that the whole purpose of his amendment was to provide certainty. He is now saying, “This won’t be certain because it will depend on half a dozen things that we cannot forecast.” Why does he imagine that people will invest on the basis of a legal obligation to do something in 2030 that it is impossible to do now, and that they will not invest on the basis of subsidies that are available now and that can be removed only as a result of breach of contract?
Mr Yeo
I am not sure that I completely follow my right hon. Friend’s concerns. Those points in the Bill will simply ensure that, in the event of an unexpected substantial change in economic circumstances or the emergence of a new technology, the Committee on Climate Change would have an opportunity to review its advice. Indeed, I would hope that it would want to do so in normal circumstances anyway. Moreover, investors are accustomed to having to adjust their decisions and expectations in the light of changing events.
I am seeking, through the amendment, to remove another element of uncertainty. I want to ensure that the Government’s current commitment to moving down a pathway of slowly decarbonising the British economy and reducing its dependence on fossil fuels, which is particularly relevant to the electricity generating industry, is reinforced by accepting an obligation to set the target in secondary legislation during the next 10 months. I believe that that would be wholly helpful to investors. It would give them a more secure and predictable framework in which to make their decisions, as well as having an effect on the returns that they might expect.
Jim Shannon (Strangford) (DUP)
In Northern Ireland, Airtricity’s electricity prices have gone up by 17.5%, and Northern Ireland Electricity’s prices have risen by 18%. What elements of the Bill will give consumers confidence that prices will not rise above affordable levels, given that prices are heading in the wrong direction at the moment?
Mr Yeo
On the wider point about future prices, it would be dishonest for anyone to suggest that we could protect consumers against the probability of higher energy prices. The world’s demand for energy is expanding very quickly, particularly in the Asian economies, and that will probably lead to higher prices. What the Government can do, and what the Bill is aiming to do, is at least to minimise those price rises. A number of measures can be taken to achieve that, including improving competition, ensuring that consumers are better informed and deploying various smart technologies on a large scale. Also, as I have said before, it would be helpful if Britain were able to go ahead and identify the scale of our recoverable shale gas reserves and then exploit them. That would certainly reduce our dependence on imports, and it might give us some protection against price fluctuations.
The amendment is not so revolutionary as some people seem to think. It seeks to bring forward by a couple of years something that the Government are contemplating doing anyway. If it is true, as the Secretary of State said yesterday, that we are heading for a substantial decarbonisation of electricity anyway—I am sure that, if he said it, it must be true—what possible objection could there be to the amendment? There is now widespread support for such a measure. Only two weeks ago, the Committee on Climate Change published a report recommending that a target for reducing carbon emissions from electricity generation by 50 grams per kWh to 2030 should be set in legislation, with the flexibility to adjust it in the light of new information. The amendment provides for precisely that.
A wide range of businesses and trade bodies have backed the proposal. The Aldersgate Group, whose members include Microsoft, Marks & Spencer, Aviva, Sky, Pepsico, British American Tobacco and many others, is a strong supporter. Many companies with an interest in the supply chain and with the potential to create jobs in Britain want to see the amendment accepted. A wide range of voluntary bodies is also campaigning for it, including the National Federation of Women’s Institutes, the Church of Scotland, the Methodist Church, the Baptist Union of Great Britain, the United Reform Church and the Quakers in Britain. I mention the Churches because, in the recent debate on gay marriage, I found myself on the opposite side from most of those organisations, and I am delighted to be allied with them on this issue.
Mr Mike Weir (Angus) (SNP)
I am listening closely to what the hon. Gentleman is saying. Does he agree that the purpose of setting a decarbonisation target now is surely related to the supply chain? Companies are looking at bringing developments on stream around 2020, as many of them have a long lead-in time, and they want to know now that there will be a market for them after that date.
Mr Yeo
That is certainly one of the reasons for the amendment. It would help to create more jobs in the UK if the supply chain companies received reassurance in that regard.
Even among hon. Members there are signs of enthusiasm for my amendment. At the Liberal Democrat party conference last September, the Chief Secretary to the Treasury proposed a motion to establish a
“target range of 50-100g of CO2 per kWh for the decarbonisation of power sector in addition to existing carbon reductions.”
If every Liberal Democrat Member of Parliament who supported the Chief Secretary on that day were to join me in the Aye Lobby at 4 o’clock, the amendment would be carried. I am sure that all my hon. Friends on the Liberal Democrat Benches are keen to take this opportunity to strengthen their well-known reputation for consistency.
Martin Horwood (Cheltenham) (LD)
How did the debate go at the Conservative party conference?
Andrew George (St Ives) (LD)
My hon. Friend will be well aware that one of the biggest road blocks to achieving progress in this area is the Chancellor of the Exchequer. It is not the Liberal Democrats who are standing in the way of the progress that we need to make. My hon. Friend needs to work with his own colleagues to persuade the Chancellor of the Exchequer to come on board.
Mr Yeo
I say to my hon. Friend that there are two people who could give a decisive signal to the Chancellor of the Exchequer this afternoon by voting for the amendment: one is the Chief Secretary to the Treasury and the other is the Energy Secretary—both members of my hon. Friend’s party, with which we are delighted to be in coalition.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)
Given that the hon. Gentleman has chosen to reduce this issue to a political knockabout, it would be interesting to ask him, if he is so committed to his amendment, what meetings he has sought with the Treasury to discuss it.
Mr Yeo
I frequently pass the time of day in the warmest possible terms with my right hon. Friend the Chancellor of the Exchequer when we are voting in the same Lobby, which from time to time we are.
Even the Government seek powers in the Bill as it stands to introduce a decarbonisation target, but for some reason they do not want to do so until 2016 at the earliest. The problem with the Saint Augustinian coyness and this promise of possible future chastity in the matter of greenhouse gas emissions—“but, please God, not just yet”—is that by 2016 many investment decisions will have been made. If these lock Britain into a high greenhouse gas emission future, they will either prevent us from meeting our climate change commitments or else will lead to the construction of fossil fuel generating capacity, which will subsequently have to be scrapped.
The year 2016 is also after the next general election. Delaying a decision until then creates another needless but harmful element of doubt about the Government’s true intentions. I therefore urge hon. Members on all sides of the House to support this amendment. Doing so will remove an element of uncertainty whose presence hampers investment, increases the risk of a capacity crisis and raises electricity prices unnecessarily. The amendment will not impose on the Government today any commitments that they do not already claim to embrace. Furthermore, it will not remove the need for even greater priority to be given to demand-side measures and to energy efficiency—issues that I wholly support. By itself, the amendment will not raise electricity prices in the next seven years by a single penny because the total sums spent on subsidising low-carbon electricity in the period up to 2020 has, as I have mentioned, already been capped by the levy control framework.
Steve Brine (Winchester) (Con)
I am listening to the things that the amendment will not do, but will my hon. Friend tell my constituents in Winchester and across the beautiful Hampshire downs what a decarbonised power sector will look like in my constituency and in many other constituencies by 2030?
Mr Yeo
That is quite a challenge because we cannot predict exactly which will be the most cost-effective technologies. I very much hope, incidentally, that we will move swiftly away from a situation in which the Government set the strike prices for contracts for difference on a centrally determined basis, and that they will allow different technologies to bid in an auction process so that we can be sure that we are getting the best value for money. It may well be that some technologies that we do not yet know about will offer better value than offshore wind farms, for example, which look to me as if they are going to be at the costly end of the spectrum. Even today, it is possible to see solar and an array of wind farms—I visited them in my constituency last Friday—operating. The farmer who showed me these with great pride—he was lucky enough to make his investment before the rates were cut a year and a half ago—pointed out that his sheep enjoyed sheltering under these panels and that there was some evidence to demonstrate increased productivity from the sheep as well as the generation of renewable power.
I think I have probably said enough about the Treasury’s floor price for carbon for the House to realise that I am not a supporter of it. I stress that we need to recognise that it is raising prices, adding to consumer and business bills and making British business less competitive relative to the rest of the EU, and it manages to do so in a way that does not cut carbon emissions by a single kilogram.
Without amendment 11, the Bill, whose early passage through Parliament is desperately needed for economic and security reasons as much as for environmental ones, will be needlessly weakened. I commend the amendment to the House.
Barry Gardiner (Brent North) (Lab)
I am pleased to join the hon. Member for South Suffolk (Mr Yeo) in supporting amendment 11 and voting for it later today.
The Secretary of State is in a bind. His party believes in a 2030 decarbonisation target—it is Lib Dem party policy, after all. His party put the issue in its manifesto. Many of his MPs went further and actually signed a separate pledge in support of a decarbonisation target. Have they not learned the Lady Bracknell rule of politics: to break one pledge may be regarded as a misfortune; to break two looks like contempt for the electorate? The Secretary of State is, however, a decent fellow and he has told me from that Dispatch Box that he favours a 2030 decarbonisation target and would be happy to implement one were it not for the fact that he struck an agreement with the Chancellor. I understand that he refers to this agreement as “the grand bargain”. Hardly: it is more of a Faustian pact.
The Secretary of State was right to negotiate £7.6 billion under the levy control framework to support renewables up until 2020—but a bargain this was not. Old coal will be allowed to provide base load beyond 2023; gas will be incentivised to provide base load right the way up until 2045. All pretence of meeting our carbon budgets and emissions targets will be abandoned, and the jobs and growth that leadership in low-carbon industries would generate will be lost. The combined value to the UK economy of all this is worth many times more than the paltry £7.6 billion that the Secretary of State has negotiated up to 2020. A grand bargain? Not since Esau sold his birthright for a mess of pottage has a worse deal been struck.
Just 10 days ago, the UK’s independent Committee on Climate Change produced its report on the electricity market reform. The report compared and analysed the relative benefits of investing in a portfolio of low-carbon technologies through the 2020s rather than investing in gas-fired generation. The report finds that investment in low carbon would save consumers between £25 billion and £45 billion. If, however, one uses the higher-end estimates of gas and carbon prices, the Climate Change Committee’s estimate then rises to £100 billion.
Mark Reckless (Rochester and Strood) (Con)
Will the hon. Gentleman tell us what the figure would be if we were to use the lower end of the estimates for gas prices instead?
Barry Gardiner
Of course. The hon. Gentleman must be forgiven for not having a memory retention of more than 10 seconds. I did, in fact, say that the lower-end figures were £25 billion to £45 billion, and that the higher end of the spectrum led to the estimate of £100 billion. There we have it. If we compare the £7.6 billion that the Secretary of State has negotiated with the lower-end range of £25 billion to £45 billion, we see what the Climate Change Committee has said the gas strategy might cost us in comparison with a low-carbon investment strategy.
Critically, the Climate Change Committee says:
“Only if the world abandons attempts to limit risks of dangerous climate change would a strategy of investment in gas-fired generation through the 2020s offer significant savings.”
David T. C. Davies (Monmouth) (Con)
Is it not the case that the climate has been changing for the last 4.5 billion years, while surprisingly there has been no increase in temperatures for the last 15 years, so growing numbers of people think the whole thing is hogwash, and they are going to support quite reluctantly what the Government are doing as the least worst option?
Barry Gardiner
Yes, the hon. Gentleman is right to say that the climate has been changing over billions of years. If, however, he cared to read the report from the Met Office and from meteorologists around the world, he would find that the fluctuation over the past 10 years, to which he referred, relates to the context and background diminishing rather than the effect of emissions reducing. Again, if he bothered to read the report, he would find that it says that once the background comes back to normal or back to the average, the effect of the increased emissions would then produce a correspondingly sharp rise in climate change. The hon. Gentleman is right to say that there have always been changes in the climate and there are risks that we must factor in, but when we do so, we must take full account of the scientific data. Failing to do so is the mistake he made in his intervention.
So here we have the United Kingdom Government, who proclaim themselves to be a leader in the international climate negotiations in the run-up to the United Nations framework convention on climate change agreement in 2015, adopting a national strategy that their own independent expert advisers have told them will make economic sense only if the world abandons its attempt to avoid dangerous climate change. If it were on “Mock the Week”, we should all be in hysterics.
This is not the advice of some partisan body funded by industry. It is the advice of the independent committee that we established and expressly charged with the task of advising Parliament on the most cost-effective measures that can be taken in order to deliver on the UK’s legally binding commitment to reduce greenhouse gas emissions by at least 80% by 2050. What that committee is telling the Secretary of State is that the £7.6 billion that he has negotiated needs to be set against at least £25 billion to £45 billion of increased costs to the UK public. The House should not wilfully choose to disregard the advice of the Committee on Climate Change unless it hears very specific evidence from Ministers that refutes its conclusions. To disagree with the Committee without such evidence would be wilfully to embrace higher energy prices than are necessary to our emissions objectives, and to accept lower economic growth and the likelihood that this policy will fail.
Amendments 11 to 20, which we will press to a vote this afternoon, require the Secretary of State to set a 2030 decarbonisation target for the electricity sector by 1 April 2014, at a level that
“must not exceed the level deemed consistent with a low-carbon trajectory as advised by the Committee on Climate Change”.
I am most grateful to the 43 Members on both sides of the House who have chosen to add their names to the amendments. They, like the hon. Member for South Suffolk and me, believe that a 2030 decarbonisation target is essential to the success of the Bill. Let me repeat those words: “the success of the Bill”. We are not trying to wreck the Bill, for it is too important to play politics with. Ministers should distinguish between those who bring a spade to bury their endeavours and those who, like the hon. Member for South Suffolk and me, bring a spade to shore them up. I am conscious that the Government Whips have been given a good deal of extra work by the amendments, and I will happily buy a refreshment for any of them who feel aggrieved by having to argue with their colleagues against both common sense and principle.
So far, we have identified a number of arguments that have been adduced in the Government’s defence. Front Benchers have been keen to tell their troops not to worry, because they have introduced a provision to set a decarbonisation target in 2016. Well, that is not strictly accurate. The Secretary of State did not need to give himself the power to set a decarbonisation target in the Bill, because he already had that power under the Climate Change Act 2008. What the Government actually do in the Bill is make it illegal for him to set a 2030 decarbonisation target before 2016. There is no compulsion for him to set it even after that date; there is only a permission and an acknowledgement that he may do so.
The Government specifically claim that the enforced delay makes sense, because by that time the Committee on Climate Change will have published its fifth carbon budget, which covers the year 2030. They say that it is best to consider the committee’s budget recommendation along with any decarbonisation target. Interestingly, the committee itself does not agree with that view. In fact, it has repeatedly disagreed with it. In its recent report on electricity market reform, it is quite explicit in saying:
“We recommended to the Government in summer 2012 that a carbon-intensity target aimed at reducing 2030 emissions to around 50 gCO2 /kWh should be set under the Energy Bill, which is currently progressing through Parliament.
In response, the Government has taken a power in the draft Bill which would allow it to do this in 2016. It has argued that setting a target any earlier would be premature, given that the fifth carbon budget covering the period 2028-2032—and setting the economy-wide emissions limit for 2030—will not be legislated until 2016.
However, it is not necessary to wait for the setting of the fifth carbon budget to take a decision on the 2030 carbon intensity target, given clear evidence to show that investment in a portfolio of low-carbon technologies is a robust strategy with low regrets and significant potential benefits across a wide range of scenarios.
Neither is it necessary to wait for the fourth carbon budget review in 2014 to set a carbon-intensity target. Although the Government has linked its approach to EMR implementation with the review of the fourth carbon budget, it will remain economically desirable to invest in a portfolio of low-carbon technologies whatever the outcome of the review, given the 2050 target in the Climate Change Act.
Moreover, delay in setting the target will allow current uncertainties to be perpetuated, with adverse consequences for supply chain investment and project development”.
The committee concludes:
“We therefore continue to recommend to the Government and to Parliament that a carbon-intensity target aimed at reducing emissions to around 50 gCO2/kWh should be set as a matter of urgency.”
Mel Stride (Central Devon) (Con)
Does the hon. Gentleman not accept that there are already many positive signals for investors in the marketplace? There is the 2050 target, there is the levy control framework that enables billions of pounds to be contributed by central Government, and there is the Government amendment to the Bill, to which the hon. Gentleman has referred and which allows the Secretary of State to take those measures in 2016.
Is the hon. Gentleman not as concerned as I am—and, indeed, as Professor Dieter Helm was when he gave evidence to the Public Bill Committee—about the possibility that including additional targets that impose restrictions on the marketplace will simply lead to higher costs for both British business and consumers?
Barry Gardiner
I agree that it is important to address the question of what the costs to British industry and British consumers will be. As the hon. Gentleman will accept, the independent Committee on Climate Change has already addressed that question, and, indeed, its remarks and recommendations were based precisely on its assessment of the likely costs and benefits and the signals that currently exist in the market; but he has made a fair point. We certainly need to ask what signals exist, and what effect either costs or benefits are likely to have on our national well-being.
It is heartening to know that the Government want to hear what the Committee on Climate Change wants to say in three years’ time. Perhaps they will now extend that courtesy further by not just hearing but listening to what the committee is saying today.
The other argument that the Government Whips have deployed against the amendments is that sector-specific targets without road maps are meaningless. That is, to a degree, relevant to the point made by the hon. Member for Central Devon (Mel Stride). This is not only about the targets; it is also about the road maps relating to the implementation of those targets, and that, of course, is precisely why we have a levy control framework. It is also why the EMR report of the Committee on Climate Change calls on the Government to extend to 2030 funding allocated to support the development of less mature technologies under the framework, to present
“options to support mobilisation of new sources of finance, including roles for the Green Investment Bank and Infrastructure UK”,
and to publish in the EMR delivery plan
“the amount of capacity that the Government intends to contract”
over the next period.
The final argument that we have heard from Ministers is that they do not wish to sacrifice jobs and growth for the sake of the environment. That is the most fallacious argument of all. It was dealt with very well in some of the pre-Committee hearings. Andrew Buglass from the Royal Bank of Scotland told the Energy Bill Committee that there is a cliff edge and that cliff edge is making it very difficult for supply chain investors to invest in the UK. Overcoming the insecurity created by the 2020 cliff edge does not require more public money or even the promise of more money. It requires coherence in the form of a 2030 target that proves to industry that the demand for low-carbon energy will continue to rise beyond 2020.
The shadow Minister, my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex), has previously quoted comments made by Mr Buglass in an Energy Bill Committee sitting, observing that Mr Buglass stated that a 2030 target
“is absolutely critical from the conversations I have with potential supply-chain investors because they quite rightly point out that it is very difficult for them to take investment to their board if they really only have visibility on three or four years-worth of work.”––[Official Report, Energy Public Bill Committee, 15 January 2013; c. 51, Q154.]
We must put that target in place if we are to incentivise potential investors and achieve the investment in low-carbon industry that we need.
Joan Walley (Stoke-on-Trent North) (Lab)
I support the decarbonisation target. Does my hon. Friend agree that this issue is not just about what DECC is doing, but what the Department for Business, Innovation and Skills is doing? There are many investors looking to invest in constituencies across the country, but they will not make that investment if the uncertainty arising from the Government’s current position persists. It is therefore vital that we get some kind of assessment of where that investment can go, because that will help to create the green jobs that we all want.
Barry Gardiner
My hon. Friend is absolutely right. One of the great mistakes this Government have made on energy policy is to confine it simply to energy itself, and not to consider it in the wider context of British industry. That is why I am delighted that the new Minister for Energy, the right hon. Member for Sevenoaks (Michael Fallon), has a spanning brief over the two Departments. I hope he will be able to bring that to bear, because we must see how our energy policy is related to our exports. Unfortunately, last night the Government did not accept the amendments on carbon capture and storage, but we must understand that the growth of CCS as a new technology in this country will impact not only on our own energy policy here in the UK, but much more widely in terms of the exports and the impact we can make on climate change across the globe and in countries such as China and India, which will be using coal for the next 30 or 40 years. That is the true prize. Our own energy consumption and our own emissions are small compared with those of the rest of the world, but the impact that our industrial policy can make is enormous. That is why we have to integrate energy and business, as my hon. Friend says.
Potential investors in the UK have a policy risk concern; they are concerned about what the future shape of our energy policy might be. Siemens told us if we wait until 2016 to set a decarbonisation target for 2030, it and many of its competitors are likely to delay or cancel planned investment in the UK. The Energy Secretary is shaking his head. I know he is not shaking his head to indicate he disagrees that that is what Siemens said, as he has read the Hansard Committee reports and he knows that is precisely what it said. He may disagree with those comments, but that is what industry is telling us, and we ignore what it is saying at our peril.
David Mowat (Warrington South) (Con)
The hon. Gentleman mentions Siemens. In Germany emissions per capita and per unit of GDP are higher than in the UK, and in the UK they are falling more quickly, yet he seems to think that the best way forward for us is to have targets and increasingly to act unilaterally. Why are our European neighbours going in the opposite direction?
Barry Gardiner
That point is often made; it is often said that Germany is getting rid of its low-carbon nuclear and is embracing coal as the fuel for the future. The hon. Gentleman is diligent on these matters, and I am therefore sure that he has examined the Pöyry report commissioned by his Government—by DECC—which was published in April 2013 and which made it clear that this is not a sustainable pathway for Germany. It concludes:
“It is our opinion that there will be no major new unabated coal or lignite projects in Germany for the foreseeable future beyond those currently under construction. Our view appears to be endorsed by the German companies: three majors have very publicly announced that they have no intention of building additional coal-fired power stations in Germany until at least the end of the decade.
The Netherlands has many parallels to Germany in that legacy circumstances are responsible for a wave of new coal-fired power stations, but that these conditions are highly unlikely to repeated.”
It then goes on to talk about Spain.
The hon. Gentleman knows that the decision on nuclear in Germany was taken at a time when highly political conditions were in play. Those conditions are not going to be replicated in the future, and, importantly, the business sectors in these countries have seen that this is not a credible future pathway.
Barry Gardiner
I shall give way to my hon. Friend the Member for Ynys Môn (Albert Owen) first, and then to the hon. Member for Warrington South (David Mowat), if he wants to intervene again.
Mr Speaker
Order. Before the hon. Member for Ynys Môn intervenes, I should point out that although the hon. Member for Brent North (Barry Gardiner) is, as usual, entirely in order as there is no time limit, he is a sensitive fellow and I therefore know that he will wish to take account of the fact that several other Members might also wish to volunteer their opinions in the course of the debate.
Albert Owen
I will be brief, but my hon. Friend’s comments on the German issue have provoked me to intervene. He is right that there may be no new-build coal power stations in Germany, but German business is concerned that it will be importing nuclear from France or coal from Poland, and that carbon issues will therefore be imported.
Barry Gardiner
If the hon. Gentleman will forgive me, I will not, as I have tried to give way as much as possible and I wish to respect Mr Speaker’s advice. I am conscious that I have spoken at great length, so I will now conclude my remarks.
Earlier this year, the Chancellor of the Exchequer received a letter from many of the companies referred to by the hon. Member for South Suffolk, in which they make the situation very clear:
“Projects can take 4-6 years from investment decision to construction and operation. We are already close to the point where lack of a post-2020 market driver will seriously undermine project pipelines. Supply chain investment decisions depend on reasonable assurance for manufacturers that a production facility to be constructed during this decade, costing hundreds of millions of pounds, will have an adequate market for its products well into the 2020s.
Postponing the 2030 target decision until 2016 creates entirely avoidable political risk. This will slow growth in the low carbon sector, handicap the UK supply chain, reduce UK R&D and produce fewer new jobs.”
The Government must reconsider.
The Minister of State, Department of Energy and Climate Change (Michael Fallon)
These amendments have attracted significant debate and interest across the House. Let me say, first and foremost, that the Government share the view that decarbonisation of the electricity sector, done in the right way, is vital. It will help us to: deliver secure and affordable energy for the long term; diversify our energy mix: insulate the economy from price spikes in the international energy market; and meet our long-term, legally binding goals on renewable energy and climate change. It is because decarbonising energy generation is one of the central pillars of this Government’s energy policy that we introduced these new provisions into the Energy Bill, in order to take that critical step of enabling a legally binding decarbonisation target range for the electricity sector to be set in 2016. That would be the first of its kind in the world.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
The Minister referred to the amendments introduced in Committee as ones that enabled the Government to set a target, but he is as aware as I am, and as many others are, that that is not what they do; they say that the Government “may” set a target. If he is now saying that the Government will set a target, will he support the amendments proposing to change the wording from “may” to “must”?
Michael Fallon
The amendments we introduced in Committee allow the Government, if they so wish, to set a target. I will come on to deal with that point, but let me turn first to the amendments tabled by my hon. Friend the Member for South Suffolk (Mr Yeo) and the hon. Member for Brent North (Barry Gardiner). I do not believe that these amendments take the right approach for the following reasons.
First, now is not the right time to set a target range. Hon. Members say that doing so will improve investor certainty, but this Government are already giving clear signals about the future of our electricity sector, and I shall address that in a moment. Secondly—this answers the point made by the hon. Member for Rutherglen and Hamilton West (Tom Greatrex)—it would be a mistake to impose a legal obligation now that a target range must be set. Decarbonisation of the electricity sector is inextricably linked to that of the entire economy, so a decision to set a binding target range should be taken in 2016 when we consider the trajectory of the whole economy towards our 2050 target. Thirdly, the Committee on Climate Change is the wrong body to set a legal constraint on what the level of the target range should be.
I wish to expand on each of those three points. Hon. Members say that we must set a target now because investors need greater certainty. The Government agree wholeheartedly that investor certainty is essential to delivering our energy and climate change goals at the least cost. That has been a fundamental part of our policy to date and it will continue to be a high priority. However, it is very important to recognise that we already have legal targets and measures that clarify the long-term future of electricity generation in this country. They include: the 2050 target to cut emissions by at least 80%, which is likely to require the entire electricity sector to be decarbonised; the fourth carbon budget that runs up to 2027, which requires this country to halve its emissions in the whole economy—we have set out in the carbon plan the likely implications of that for the electricity sector; and the 2020 EU renewables directive, which will mean 30% of electricity generation coming from renewables in 2020, compared with around 10% today. We shall also be arguing, as the Secretary of State announced last week, for the most ambitious greenhouse gas emission target ever to be set in the European Union of 50% by 2030.
In addition, we have committed ourselves to providing clarity on the trajectory of the electricity sector up to 2030 by issuing guidance to the National Grid Company on an indicative range of decarbonisation scenarios consistent with the least-cost approach to achieving our overall 2050 carbon target. Of course, we must also not forget that what matters most for investors now is not simply words and aspirations, but funding. That is what we have got through the Government’s decision to increase support for low-carbon electricity year on year to £7.6 billion by 2020, a tripling of support between now and 2020 which provides a clear and durable signal to investors.
Dan Byles (North Warwickshire) (Con)
Was my hon. Friend, like me, struck by the comments made by the chief policy officer of the CBI at the weekend? She said:
“It is clear that investment decisions will stand or fall on the details of the Contracts for Difference, the capacity mechanism, and the levy control framework—not on a carbon intensity target.”
Michael Fallon
My hon. Friend anticipates me; I was certainly due to quote the CBI in support, and I will come to that in a moment.
Finally, in this regard, I should mention this Energy Bill, which puts in place the most significant reform of our electricity market since privatisation, in order to attract the £110 billion of investment we need over the next decade to replace current generating capacity, upgrade the network and cater for rising electricity demand. That will provide further support for investors. For example, the Government’s delivery plan, which is due to be published in draft in July, will provide draft strike prices for renewables projects that wish to take up contracts for difference. They will provide further certainty about potential future revenues to developers of such projects, at an earlier stage than under the renewables obligation. We expect this approach to bring on significant investment in renewable technologies, enabling the Government to meet their objectives on renewable energy, decarbonisation, security of supply and affordable energy for consumers.
This Bill has already been welcomed by investors. John Cridland, director general of the CBI, has said that it sends a
“strong signal to investors that the Government is serious about providing firms with the certainty they need to invest in affordable, secure, low-carbon energy”.
The chairman of ScottishPower has said:
“our investment plans will create 4,500 jobs…along with thousands more jobs in other industries, and a further increase in the £1 billion we spend each year with UK suppliers.
We are able to make that sort of investment because we have confidence in the UK, and in its energy policy and regulatory regime.”
Dr Alan Whitehead (Southampton, Test) (Lab)
The Minister states that trajectories are already in place, not only for electricity generation and decarbonisation, but in this Bill. Bearing those in mind, will he now, this afternoon, rule out the implementation of any element of the gas strategy that his Department has recently published, particularly the one suggesting that a possible scenario might introduce gas to twice the emission levels put forward by the targets he has set out today?
Michael Fallon
No, I certainly will not do that; gas is a key part of our carbon plan, and I hope that the hon. Gentleman will look at the gas strategy as a whole.
Setting a target now to come into effect next April would mean not waiting to consider what is happening in the wider economy, for example, the progress being made in the commercial deliverability of carbon capture and storage, how that could contribute to decarbonising our energy supply, and the take-up of electric vehicles in the coming years. Therefore, setting a target now risks imposing additional costs on the economy and on consumer bills in the future in order to meet the target, and that would not be helpful for anyone.
The Government believe that the right approach is to make a decision on whether to set a target in 2016, when we can consider the whole picture. That already means setting the target range 14 years before it is due to be met. That is even longer than is required under the Climate Change Act 2008 in respect of carbon budgets, which are set 12 years ahead. Setting it now—in effect, asking Ministers to set it at Christmas—means that we would be doing so 17 years ahead. I suggest to the House that there is no certainty for investors in setting a target before we can possibly know how we can meet it.
That takes me to my second point, which is that the Secretary of State can only make a decision on whether to set a target when considering the trajectory of the whole economy towards our 2050 target in a way that is consistent with the overarching framework provided by the Climate Change Act. The timing is important. There is significant interaction between the electricity sector and other sectors of the economy, especially those, such as heat and transport, that might well become more dependent on electricity as we move into the 2020s and 2030s. That will in turn have an impact not only on overall demand for electricity but on when that electricity is needed.
Such questions must all be considered together when thinking about the best way to decarbonise electricity generation as part of a least-cost route to meeting our obligations under the Climate Change Act. It is therefore vital that a decision to set a target range is not taken in isolation, which is the approach suggested by my hon. Friend the Member for South Suffolk and the hon. Member for Brent North, but in the context of considering the pathway of the whole economy towards our 2050 target. That date will be in 2016 and not before, because 2016 is when we are due to set in law the level of our economy-wide fifth carbon budget, which will cover the corresponding period between 2028 and 2032. At that point, we will be able to consider the pathway of the whole economy towards our overarching 2050 target and understand better the most cost-effective way to achieve that. If at that point in time it is decided that a target range is the right approach, we will have the legal authority under the Bill to act swiftly to set a binding target at the right level.
I believe that my hon. Friend the Member for Wealden (Charles Hendry) was right to say in an article last weekend:
“My difficulty with the target…is that we would be requiring it to be set without knowing that it can be met, and that cannot be a responsible decision for government to make, when the costs of getting it wrong would have to be picked up by consumers for decades to come.”
His argument is that given the uncertainties about the relative costs and potential of different low-carbon technologies, it would not be right for a Government to set a target now without first having thought through precisely how a particular level would be achieved. I agree with him and believe that that is why we should consider setting a target range in 2016 in the wider context of setting and determining how we will meet the fifth carbon budget.
That takes me to my final argument, which is that amendment 14 requires that the level of the decarbonisation target range must not exceed that recommended by the Committee on Climate Change. I fully agree that there should be a role for the committee and our proposed approach takes that into account.
Mr Redwood
Is the Minister at all concerned that China, the United States of America, Japan and most other non-EU countries are not setting any of those targets and as a result have much cheaper energy than we do?
Michael Fallon
Some have not passed climate change legislation, of course, which is why they are not bound to set targets.
By waiting until 2016 to make a decision on whether to set a target, the Government can take on board the advice provided by the Committee on Climate Change on the level of the fifth carbon budget, covering that period, as part of its responsibilities under the Climate Change Act. That advice must include views on the whole economy, including the electricity sector.
It would be wrong to blur the lines of accountability between the Committee on Climate Change and the Secretary of State, as the role of the committee is to advise the Government and not to set policy. That point was made neatly by the right hon. Member for Lewisham, Deptford (Dame Joan Ruddock), who was the Minister in charge of the Climate Change Bill in Committee in 2008. She said:
“The committee will have a vital role in providing impartial advice and scrutiny, but we do not think it appropriate for an unelected body to make, or be seen to be making, policies. The individual decisions that will directly affect families, communities and businesses should be made by Parliament and the Government.”––[Official Report, Climate Change Public Bill Committee, 3 July 2008; c. 285-286.]
That could not be clearer and I agree that it should be for the Secretary of State to decide the level of any decarbonisation target range, because it is he who ultimately bears the responsibility and is accountable to Parliament. Of course, he should take into account the committee’s advice, just as he does now when setting the carbon budgets, but that advice should not impose a legal constraint.
Mr Yeo
One thing about which I am pretty certain is that the world’s concern about climate change will be more intense in 2030 than it is today. The probability is that through a combination of emissions trading systems and carbon taxes there will be a high carbon price in 2030, and I believe that the most competitive economies in 2030 will be those that have reduced their dependence on fossil fuel consumption.
Michael Fallon
I can certainly agree with my hon. Friend that the concern might well be more intense, but whether we will be so certain, I am not so sure. Indeed, I have read a report of a speech delivered by my hon. Friend during the recess, in which—I was somewhat puzzled to see this—he said about climate change that
“the causes are not absolutely clear. There could be natural causes, natural phases that are taking place.”
Mr Yeo
Let me make the record absolutely clear. I said that during the 4 billion year history of the planet there have been much greater changes in climate than anything that is likely to result from a 50% increase in greenhouse gas concentrations, but that those changes took place before there were human beings, which are one of the most recently arrived species. If we are to support life for 7 billion going on 9 billion human beings in the style to which we have rapidly become accustomed and to which many still aspire, the one absolute precondition is climate stability.
Michael Fallon
I am sure that those who support my hon. Friend will be grateful for that explanation. The quotation I have seems pretty clear to me, but it is for him to explain it. If he is not so sure any more, why should the rest of us be so sure?
I would say to my hon. Friends that they should let the Opposition, as they always will, be opportunistic. Let the Opposition please the lobbyists by suddenly supporting a target that they never endorsed in 13 years in power. I ask those of us here who share the responsibility of government to be a little more careful not to risk higher bills now for our hard-pressed industries and constituents, not to force out generating plants before we have the new investment that the Bill will deliver and, above all, not to drive up costs for those industries struggling to compete against lower energy costs abroad.
Let us have economic and industrial policy that is coherent, and energy policy by design, not decarbonisation by dogma or by default, which can only drive our industries offshore. There is a better way forward, and it is in the Bill. Let us be the first Government ever to enable a legally binding target to be set at the right time: when we set the fifth carbon budget in 2016. We can then better assess the real prospects and costs of carbon capture and storage; properly measure what is happening to the whole economy; and better judge the transition to a greener future against the costs that our consumers and businesses must bear. I urge all my hon. Friends not to rely on blind faith, but on the practical steps that we are taking in the Bill to decarbonise our economy while ensuring security of supply at least cost to our constituents.
Caroline Lucas (Brighton, Pavilion) (Green)
There are many reasons to support the decarbonisation amendments, and many hon. Members—most recently the hon. Member for Brent North (Barry Gardiner), who is just leaving the Chamber—have set them out with great expertise and eloquence. From a security perspective, I want to underline that the stakes could hardly be higher. It is clear that those who will suffer the most harm and hardship from the impacts of climate change are often the poorest and most vulnerable, here in the UK and globally—those who have contributed the least to the problem. In that respect, this crisis is not unlike the banking crisis.
As many business leaders and experts such as Lord Stern have said, there is no business as usual at all in a 3° or 4° warmer world. A couple of years ago, at the launch of the UK’s climate adaptation plan, the big idea was managing the unavoidable and avoiding the unmanageable. “Avoiding the unmanageable” means keeping global temperature rises below 2°. For years, that line in the sand has been recognised by the UK and most other Governments, and enshrined in legal documents under the auspices of the United Nations framework convention on climate change and the G8. That is the basis for the UK’s Climate Change Act 2008, and our carbon budgets, which the policies in the Bill will, or perhaps will not, deliver. Internationally, citizens and Governments of low-lying island states risk their entire nation being literally wiped off the face of the map, even with a 2° rise.
David T. C. Davies
I read recently that Tuvalu would be wiped off the face of the earth within 10 years if we did not do something about global warming. The only problem is that the article was 10 years old, and all those islands are still there. Is this not just more exaggeration from those who want higher electricity prices as a result of decarbonisation?
Caroline Lucas
I do not really know where to start to respond to such an ignorant intervention. I will not even bother wasting my time with it.
As I say, a couple of years ago, we were talking about the fact that entire nation states face being wiped off the map. If the hon. Gentleman cared to look at the situation in Tuvalu, he would realise that it is getting more and more serious. If such a real and present threat were facing the UK, would we not join their calls for much more dramatic emission reductions, to keep the global temperature rise to less than 2°—perhaps to 1.5°? Would we not go, as many nations are, for 100% renewable energy over the next few decades?
I cite those statistics because I want to remind the House what we are talking about. Much of the debate so far has rightly been about the cost of decarbonisation, and about the targets and so on, but the bottom line is that what we are discussing is literally life and death. People’s life or death is at stake today. That is why we need to use this opportunity to make sure that the Bill is as ambitious as it can be.
I have talked about what I would regard as the moral case for swift action. We have heard a lot about the economic case. There is no shortage of companies telling us that a decarbonisation target is essential. The joint letter of more than 50 Aldersgate Group members, for example, said:
“the Government’s perceived commitment to the low carbon transition is being undermined by…the absence of a specific carbon intensity target.”
Many other companies would say the same.
I would like to focus on the impact internationally of what we do at home. A domestic decarbonisation target is crucial if the UK is serious about securing a global deal on climate. We hear a lot from the Government about the need for international action, and it often sounds as though they are saying, “Let’s wait until there is international action before taking action here at home,” but as someone who would know about this, John Ashton, would say, action at home first is absolutely critical if we are serious about getting global agreement.
John Ashton, as many hon. Members will know, was the Government’s special representative on climate change, a Foreign Office diplomat who has spent many decades working on the subject. Last month, he talked about the need for global agreement, explaining:
“British diplomacy can influence this, perhaps critically; the argument that we are just too small to count is nonsense. But our diplomacy starts at home.
I have been personally involved in British climate diplomacy for most of the last 15 years, at the heart of it for much of that time. Nothing that we accomplished could have been accomplished if we had been faltering at home as we are now. You cannot expect others to act as you ask, or even listen to what you say, if you are not doing yourself what you want them to do. If we in Britain appear to be giving up…we will be out of the game. That is why I spent so much of my time as a diplomat, close to half of it, on domestic policy.”
Let us not think that domestic policy and global policy are not linked. They are essentially linked. If Britain is to maintain its position as a real leader on climate change, we absolutely have to act at home. The decarbonisation target is a crucial part of that.
Indeed, I would say that the target does not go far enough, although of course I will support it this afternoon. Let us remember the context: a target of 50 grams of carbon per kWh by 2030, which is what the amendments that we are considering are essentially proposing, is absolutely the minimum that we should seek to achieve. The Climate Change Act 2008 and the carbon budgets that flow from it reflect the overwhelming consensus, stated many times by the Government, that we have to keep below 2° warming, but current carbon targets give us only a 37% chance of doing that. I want to emphasise that, because I sometimes think that when we discuss targets in the House, we assume that if we meet a certain target, that gives 100% certainty of a given outcome. Clearly it does not; it is about a balance of risks. How many of us would get on an aeroplane if we were told that it had only a 37% chance of reaching its destination in a safe way? A 37% chance is pretty low, yet those are the odds that we are arguing about even now.
I wish the argument was about not whether we should decarbonise straight away or by 2016, but the extent, far-reachingness, speed and ambition with which we should do it. That is the debate that we should be having, instead of arguing about whether we should be going in this direction at all. An honest reappraisal of our targets is needed, with science, and the implications for young people, vulnerable communities and future generations, at the forefront of our minds.
The hon. Member for Brent North, who is a leading advocate for action on climate change globally, raised the challenge of the need for tighter targets in his Westminster Hall debate. I would like to know his view of John Ashton’s stark conclusion that the UK could never have achieved anything close to its previous international influence against the backdrop of current policies. Credible domestic targets and action are crucial.
As well as science-based targets, we need an honest reappraisal of the role of fossil fuels and the fossil fuel lobby’s enormous influence over policy making. To say, “Gas is lower-carbon than coal, so let’s get fracking” is disingenuous at best. Gas is still a high-carbon fuel, and gas prices are projected to rise in future, irrespective of shale gas. That is according to most of the expert analysis that I have seen, certainly from independent sources without direct or indirect financial or family ties with Cuadrilla and the wider fracking fraternity.
Through the Bill, Ministers are putting in place mechanisms that offer vastly greater support to nuclear power than to renewables. The Bill is about gas and nuclear; it is not sufficiently about a low-carbon future. Through it, Ministers are offering long-term guarantees for high-carbon gas generation until 2045, and a way for the same gas companies that are putting up bills and raking in profits to take even more money from taxpayers and bill payers through the capacity mechanism. The Secretary of State is offering long-term guarantees and assurances for high-carbon gas generation, and tax breaks for fracking. Ministers have not chosen to give anything like a similar degree of certainty for wind, wave, tidal, solar, biomass, hydro or geothermal power—nothing beyond 2020. That is made even worse by the Government’s opposition to proposals, backed by industry, for 2030 targets for either renewables or efficiency.
The Government had the opportunity, in the Bill, to drive a radical transformation in ownership and control of energy away from the big six to communities, localities, individuals, private companies, public authorities, joint enterprises and co-operatives. Instead, they have chosen a support mechanism that only really works for the likes of EDF, npower, Centrica and E.ON, which will tighten their death-grip on us.
In the light of these actions, it looks extremely unlikely that the UK stands much of a chance of achieving the carbon reductions necessary, or even of remaining on track to meet the 2050 target without a 2050 decarbonisation target. I end with another quote from John Ashton. When asked for his view on the decarbonisation target, he stated:
“I can’t myself see how any MP who votes against the target will thereafter be able credibly to claim that they support an effective response to climate change.”
I know that will not bother some in the House, but I hope that for many other Members it will concentrate their minds on the vote.
Mr Redwood
I remind the House that I have declared in the register that I offer advice on global economies to an investment business and an industrial business.
I oppose the amendments in the name of my hon. Friend the Member for South Suffolk (Mr Yeo) and others, and I do so primarily because it is high time that this House heard a voice for the consumer of energy. I am extremely worried about energy prices. The Labour Government did some good work, highlighting the serious problem that they called fuel poverty. They rightly identified the fact that at the time of their Government many people in our country found it difficult to pay the energy bills because they were already high. In recent years—the end of the Labour period and now under the coalition—those bills have gone up considerably further.
People facing fuel poverty have also had the great problem that in recent years we have had a succession of particularly cold and bitter winters, with heavy snowfalls and ice, and a series of rather cold and damp summers. Although I will not go into the arguments about how we can measure rising temperatures and how much global warming we are actually experiencing, the cruel fact of life for people facing rising energy bills is that they need to use more energy because it is so cold and they need to keep warm. We even had snow and frost in May this year in England, at the very time that energy prices were being put up, partly by market forces and partly by a deliberate act of policy by the Europeans to try to make energy dearer to put people off using it. We need to take on board the fact that there is a serious problem of people affording the heating bills.
This is doubly damaging in an economy that is experiencing a fragile and modest recovery and needs a faster recovery. Energy is taking too much of the family budget. At the very time when we want people to have more money to spend on other things to create demand and jobs around the economy generally, a large chunk is being taken up by those rising energy bills, both because of price and because of the need to burn more as a result of the climate conditions outside. We also see that there is an additional problem, which my right hon. Friend the Minister referred to at the end of his speech: British business now faces considerably higher costs for the energy it needs to use than competitor businesses in America or throughout much of Asia. It should be a grave worry to everyone in the House who is concerned about jobs and about the creation of more industrial activity in Britain that we are deliberately creating very high priced energy in this country, which is a major impediment to industrial development.
I welcome the Chancellor’s statement some time ago that he wished to see the “march of the makers”. I welcome the idea that we need to build up stronger and bigger industry to go alongside the successful job creation that we have had in financial and professional services and related areas. It would be good for our economy to have a more diverse and flourishing structure. We have some very good industrial businesses, but we do not have enough of them and the sector is not as large as I think any major party in the House would like to see.
So if we are all serious about wishing to have an industrial strategy that works, and if we are serious about wanting to create a climate in which business can flourish and more industrial jobs can be created, surely we must tackle one of the main costs that business faces—the cost of energy. The Government are well aware of the problem and have responded to lobbying by high energy-using industries, such as steel, glass and ceramics, where energy is a massive part of the total cost because extreme heat is applied for the transformation of the materials in the process. The Government are providing some kind of subsidy to those heavy energy users in a desperate attempt to prevent some of those factories and process plants closing, but even with the subsidy the production costs are much higher in Britain than in America, China or other parts of Asia, so we are still at risk of losing more of that business by closure, and we are certainly at risk of not attracting the new investment in those types of industry that we might like as part of our industrial strategy.
The Government also need to understand that it is not just transformational processes such as steel or glass production that have an energy cost problem; it is more or less any kind of industry with an automated plant. If we wish to be competitive in a western country against countries in Asia which have relatively low labour costs, we need to automate. We need to have a very high degree of machine power so that all the mundane jobs can be done by intelligent machinery to keep costs under control. But we lose the advantage of being able to automate and use high technology if the cost of the energy to drive the machinery is so uncompetitive. We will soon lose the advantage as well because a country such as China is industrialising not only very rapidly, but with the application of far more technology and labour-saving equipment going into its factories. So we have a double problem in that such countries are automating and they have much cheaper energy.
I urge the Government to take our problem of energy prices extremely seriously. American energy prices are typically a third lower than United Kingdom energy prices, so if energy is 10% or 20% of the cost of the given process and the given industry, we can see immediately that there is a 3% or 6% cost advantage just from the energy bill, which in very competitive world markets can be an important distinction. When we look at the success that America is now having in building her recovery longer and faster than the European countries, it is clear that part of that success comes from the accent placed on cheap energy. The United States of America has not put through legislation similar to the legislation passed in 2008 by the Labour Government—legislation that I did not feel able to support at the time because I thought it would be damaging to prosperity and would put up our energy bills too much—and we see that America is also reaping the benefit of the shale revolution. I hope that the words of the Prime Minister and the Energy Minister will result in action, because the United Kingdom has an opportunity with shale as well, but America not only has found the shale and is keen on the shale, but is now extracting such large quantities of shale gas that it has much, much cheaper gas prices than the United Kingdom, of benefit to consumers and American industry.
We should be aware of the fact that when countries assembled to try to take on the Kyoto work of carbon targets, it was noticeable that only the European countries were left in the game. Even Japan, which had obviously been the host to the original Kyoto proposals, was no longer willing to sign up to such targets.
Martin Horwood
Is the right hon. Gentleman aware, though, that as part of the United Nations framework convention on climate change process, China has accepted carbon intensity targets for its economy?
Mr Redwood
China is allowed to have a totally different approach to carbon targets because it is a growing economy. I have a great deal of sympathy with its need, but China is not being asked to cut its carbon emissions in the way that the United Kingdom is being asked to cut emissions. When the Kyoto process was last looked at to try to get much tougher targets across the world, the only countries that were still prepared to be in the game were the European countries, so the European economy as a whole on the continent is saddled with dangerously high prices and restricted ability to generate power in different ways, and the United Kingdom has the particularly virulent strain of this disease because of the House’s passion to legislate for dearer energy.
Mark Reckless
Does my right hon. Friend agree that to an extent the EU may even be dropping out, leaving us with unilateral measures of the carbon floor at £16 a tonne, when in the emissions trading scheme, which is barely working now, it is less than £2?
Mr Redwood
My hon. Friend is right, I fear, but that goes a little wider than the amendment. What we are trying to do today is to stop making matters worse by encouraging the amendment, which would mean that the United Kingdom got even more out on a limb. As he implies, the Germans, having decided against nuclear for a variety of good and political reasons, are clearly going to use a lot more coal, and I cannot see how they can conceivably do that and hit all the targets. They will just move on and in due course Germany’s influence in the European Union may well dilute the target more in the European Union as a whole and leave the United Kingdom even more exposed.
Andrew Bridgen (North West Leicestershire) (Con)
Is my right hon. Friend as concerned as I am that any free trade agreement between the US and the EU may turn into one-way traffic for manufactured goods? Perhaps that is why the Americans are at the negotiating table now. They see the competitive advantage that they will have on energy costs.
Mr Redwood
My hon. Friend is absolutely right. The Americans are playing a blinder on all this, and we need to understand that the American economy is now getting itself back into order, which we should welcome as they are an important ally and a big trading partner, but we should also be warned that they are doing things to have competitive energy that we are clearly not prepared to do.
I hope that the House will join those on the Government Benches in voting down the proposal. It makes a bad situation worse, and I urge Ministers to understand that their prime duty is to keep the lights on and their secondary duty is to make sure that the power is affordable, both so that granny does not have to shiver when we have a cold summer or winter and so that we have some industrial jobs left by not trying to be holier than thou and ending up unemployed.
Tom Greatrex
I rise to speak in support of amendments 11 to 20, which, as the hon. Member for South Suffolk (Mr Yeo) said, stand in the names of a range of Members from almost every party in the House, and certainly from every part of the UK, including Members from both governing parties. In particular, they include my hon. Friend the Member for Brent North (Barry Gardiner) and the hon. Member for St Ives (Andrew George), who is no longer in his place, but who secured a Westminster Hall debate on the issue just prior to the Queen’s Speech.
I begin by paying tribute to the lead proposers for their efforts in securing cross-party support for the amendment. There have been three Ministers in eight months so it is easy to lose track, but the hon. Member for Wealden (Charles Hendry), who unfortunately cannot be with us this afternoon, spoke in a debate in the House last November about the need to take energy policy out of politics, because investors need to know that there is support for long-term measures. That is key, and it is in that spirit that the amendment is offered to the House this afternoon and that the Opposition will seek to support it in the Division Lobby.
As the hon. Member for South Suffolk and others who have spoken have made clear, the crux of the amendment is that if, as the Government keep repeating, their intention in relation to energy policy is to seek renewal of our energy infrastructure in a way that safeguards security of supply and reduces our carbon emissions, and does so in the most affordable way, then the greatest prize in securing that investment is clarity, predictability and purpose. That is precisely what a decarbonisation target provides, and it does so in conjunction with the carbon budget and other measures in the Bill. That is why I believe that there is, or certainly was, near universal support for a decarbonisation target. My right hon. Friend the Leader of the Opposition called for it last year. As we have already heard, the Chief Secretary to the Treasury moved such a motion at the Lib Dem conference last year. Two years ago, the Prime Minister himself said that decarbonisation is necessary if we are to meet our ambitious climate change commitments. As we heard from the Chair of the Select Committee, it unanimously concluded that
“providing greater clarity about the contribution that the power sector is expected to make towards meeting these targets would help to provide certainty to investors. The Government should set a 2030 carbon intensity target”.
Many Members present today served on the Bill Committee and they will recall that the Secretary of State said in evidence that he supported a 2030 target. He is no longer in his place, but when asked whether he supported a target he said:
“I do not think that it is a secret. That is my position and the position of my party. We are in coalition and we have had discussions with assertive colleagues.”––[Official Report, Energy Public Bill Committee, 15 January 2013; c. 8, Q11.]
A number of others are assertive about the importance of the target, however, and I am talking now about those outside of the House and politics. There is strong support for this in the energy industry, business in general, academia, public bodies, the Government’s own advisers on these issues, the Committee on Climate Change, as we have already heard, organisations and industry, including companies as diverse as Microsoft, Sky, Unilever, the EEF—to respond to the point made by the right hon. Member for Wokingham (Mr Redwood), the steel industry is a member of the EEF, which supports a 2030 decarbonisation target—the Carbon Capture and Storage Association, Oxfam, the Catholic Fund for Overseas Development, the Environment Agency and many more, not just those who seek to benefit directly from the investment that we know needs to happen. Memorably, when the Secretary of State was challenged in Committee by my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) to name a company that opposed the target, he was unable to do so.
Anas Sarwar (Glasgow Central) (Lab)
The Minister talked repeatedly about investment and my hon. Friend refers to the uncertainty of investors. Does he recognise the analysis by Bloomberg New Energy Finance that investment in renewable energy has fallen drastically since the Government came to power? What does that say about the Government’s ambition to be the greenest Government in history?
Tom Greatrex
My hon. Friend is absolutely right about the worrying signals on confidence. That is part of the case being made today for the target. We need to have that confidence if we want to get that investment, those jobs and that manufacturing capacity, quite apart from the other benefits in terms of security of supply and carbon emissions. That is why I am sure that those industries and companies will be concerned to hear the tenor of some of the Minister’s remarks, which seemed to be going further back even than those of his predecessor, who I think was moved to the Loftus road of Government, the Cabinet Office, the home for displaced Ministers, in suggesting that this is something that we might not want to do in the future. The right hon. Member for South Holland and The Deepings (Mr Hayes) made it clear in Committee that he felt that this was not a debate about the principle of a target, but about when it was going to be set. It seems that the Minister has rowed back further from that position.
Dr Phillip Lee (Bracknell) (Con)
Does the hon. Gentleman agree that if we set a territorial decarbonisation target, we can make industry off shore, hit our decarbonisation target and retain the subsidy on shore, but the jobs will have gone elsewhere?
Tom Greatrex
If we want the best chance of getting those jobs in the UK, the best chance of Siemens building its offshore turbine factory in Hull and the best chance of Gamesa building its factory in Leith, and to get the wider jobs and growth benefits, we need a target. If costs are disproportionately high in the UK we must look at the cause—a carbon floor price that is completely different from what is happening elsewhere in Europe. That is the real focus on where those costs are higher. If we want those economic benefits, we need the target, because that is what industry needs to make those decisions, to convince those global boards that have a number of different options about where to make that investment and to make sure that it happens within the UK.
Tom Greatrex
As my right hon. Friend says, they are not mutually exclusive. We need to do both. Some here today might disagree, but not that many.
Mr Redwood
Why does the hon. Gentleman think that industry fell so far and fast as a proportion of total output in the Labour years and what has he learned from that?
Tom Greatrex
What we have learned from the past three years, as was pointed out by my hon. Friend the Member for Glasgow Central (Anas Sarwar), is that confidence in investment in the UK among those new industries has fallen and is falling. What we have learned from what is happening now is that people are not making decisions because they are seeking clarity and certainty from the Government on a range of matters to do with the Bill, including the specific issue we are discussing. If the right hon. Gentleman is concerned about manufacturing industry, he should support the target, which will help give clarity and certainty and ensure that manufacturing jobs come to the UK.
Mark Reckless
The hon. Gentleman tells us that he has learned lessons in the past three years. Did he learn any lessons at all from the previous 13 years?
Tom Greatrex
What I learned from the time towards the end of the Labour Government is that a focus on industrial strategy is absolutely key in diversifying our economy, and that the significant increase and activity in the renewable and low-carbon industry, which were happening and are now under threat, resulted from a clear set of signals from the Government. That is what we need from the Government now, but we will not have it unless the target is included in the Bill.
I will make progress, as other hon. Members wish to contribute. Before the interventions, I was touching on some of the points implicit in remarks made by some Government Members about costs and gas. Rejecting a 2030 target will almost certainly lead us to another dash for gas. As I said in Committee and all the way through our consideration of the Bill, gas has an important place in our system. As I have made clear, I do not take an ideological position on shale gas either; it needs to be properly regulated and monitored, but we need to explore what is there before we can know what we can get out of it.
Making simplistic extrapolations from what has happened in the US indicates a bout of wishful thinking, and a hope—and risk—in respect of something that might well not turn out to be the case. We need gas and will continue to need it; it is important for our security of supply and for our being able to deal with peaks in demand. However, the combination of a failure to decarbonise our electricity sector and increased reliance on gas leaves us more exposed to the volatility of that globally traded commodity.
It is essential that there should be diversity in our energy supply even before we consider any of the impacts in relation to emissions and the climate. The danger is that we will be left open to a greater reliance on gas and consumer prices going up even further. Various hon. Members have referred to the increase in cost to consumers, but they know as well as I do that the greatest element of that cost increase in the past three years has related to wholesale energy prices.
Sometimes there are discussions about how far companies properly pass on savings when the costs fall, but over the three years wholesale prices have certainly increased and that is the greatest single part of the increase in energy bills paid by my constituents and those of the right hon. Member for Wokingham and other hon. Members. The target is also vital for that reason.
The problem is the Government’s approach to decarbonisation and how it is characterised in their amendments in Committee. The Government may or may not, at some point in the future that is yet to be defined—it may never be defined or indeed reached—set a decarbonisation target range for the carbon intensity of electricity generation in Great Britain. The definition of carbon intensity itself and the means of calculating it can be changed by the Secretary of State—and, by the way, the Secretary of State can revoke the order. That is hardly the sense of clarity that the amendment seeks.
The illogicality of the Government’s argument is summed up in amendment 52, which the Minister only barely referred to. It would require the Secretary of State to publish an annual report from 2014 setting out how he had met the duty to meet a decarbonisation target. I suspect that that report would be very thin, simply reading: “A target will not be set until 2016. There is nothing more to report—move along now.”
It was not only the Secretary of State who said that he supported a target. The Minister here, the right hon. Member for Bexhill and Battle (Gregory Barker), did so in the recent Westminster Hall debate, saying:
“I see the strong merit of the argument for a decarbonisation target”—[Official Report, 17 April 2013; Vol. 561, c. 124WH.]
But he also said that we should wait to set it. The Minister’s predecessor said in Committee:
“The principle, that it would be useful and of value to set such a target, is established.”––[Official Report, Energy Public Bill Committee, 5 February 2013; c. 489.]
If that is the case, there is no reason why the Government should not at the very least support the amendments that change “may” to “must”. However, as we have heard from the tenor of the Minister’s and some other hon. Members’ remarks, that is not what the issue is about.
The issue is about a deep division in the Government and a damaging and risky outlook that a dash for gas is the best course of action for our energy policy. That is obviously what the Chancellor thinks, but it is not what the Chief Secretary to the Treasury thinks, unless he has changed his mind. The Committee on Climate Change does not think that; nor does industry or the 200 organisations that support the amendment. As I said, the Secretary of State has supported a target and he does not think that either, although he has lost out in discussions with what he referred to as “assertive colleagues”.
There is an opportunity for Parliament to be assertive this afternoon—assertive about security of supply, about jobs and growth, about investment, about clarity of purpose and in our support for the important amendments before us.
Mike Crockart (Edinburgh West) (LD)
I rise to speak with a fair amount of trepidation; I feel like Lord Cardigan, commander of the gallant 600, charging into the valley of death. Half a league onward, as they say. [Interruption.] Yes, some did make it through; I shall hold on to that fact.
I have spoken to many individuals, companies and organisations over the past few weeks and months and asked each of them what they felt was needed in the Energy Bill. To be frank, nearly all of them asked for different things. This is a mammoth Bill trying to do lots of different things and everyone is clear that those things need to be done in the right way.
I have talked to small generators—new entrants to the market. They would like a decarbonisation target, and so would I, but what they would like more is for their route to market to be easier and free from too great a reliance on the big six suppliers—whether that is through a green power auction market or other means. I know that a great deal of work has already gone into this, but it is essential that the Government table amendments that offer a long-term solution and not merely transitional help.
I have also talked to large generators, which are already investing billions of pounds in new infrastructure. They would also like a decarbonisation target, as would I, but what they would like more is for the strike price to be set at a level that gives certainty in their markets and allows them to plan for the next 20 or 30 years and access finance over that time scale.
I have talked to consumer groups, acting on behalf of hard-pressed electricity customers. They would like a decarbonisation target, as would I, but what they really want is a meaningful simplification of tariffs. They want a single, consistent unit price to allow people to compare and immediately identify cheaper alternatives, forcing suppliers to keep prices down, improving competition and making it easier for consumers to switch.
I have talked to companies, large and small, involved in the manufacturing supply chain for renewable energy. They, too, would like a decarbonisation target, as would I, but what they want more is for access to ports to be sorted out or for the tripling of the levy control framework to happen in a controlled and steady way, rather than being backloaded towards 2020, so that their new technologies get a chance to establish themselves and deliver the tens of thousands of jobs that green growth can bring. Small and medium-sized enterprises more generally are most exercised by uncompetitive energy contracts and unfair renewal terms.
I have also talked to community groups, and guess what? They would quite like a decarbonisation target, but what they crave is an increase in the small-scale feed-in tariffs threshold for community energy schemes from 5 MW to 10 MW. The danger is that, as community schemes become more successful, they may hit 5 MW. An increase in the small-scale feed-in tariff limit will ensure that we do not inhibit their development. That is real and meaningful help for community energy schemes, making routes to market simpler and more attractive for them.
What about investors—investment banks and pension funds? Would they like to have a decarbonisation target? Of course they would, but at the top of their shopping list are things such as detailed contract for difference terms that are fit for purpose, a credible contract for difference counter-party that the market can trust and believe in, an easier route to market for independent generators, and no strike-price auctions before the electricity market reform regime has been operating for a number of years and the financial community has grown comfortable with other aspects of the contracts.
Tom Greatrex
I am listening carefully to the hon. Gentleman’s list. He will know that some elements of it are dealt with in later amendments, particularly the one about community energy, which would increase the threshold from 5 MW to 10 MW. Will he support that amendment if we divide on it?
Mr Deputy Speaker (Mr Lindsay Hoyle)
We can bide our time on that until we get to that group of amendments.
Mike Crockart
I have been told not to deal with it; I think the direction I was given is quite clear.
Of course I would like a decarbonisation target, but that was not in my party’s manifesto; indeed, it was not in any party’s manifesto. Nor was it in the coalition agreement. In fact, there is only anything about it in the Bill at all because of the efforts of a Liberal Democrat Secretary of State, ably backed up by the present incumbent. Of course I would like more, but as 15% of the coalition Government we cannot always get exactly what we want. [Interruption.] It is 15.5%, in actual fact.
I came to this place from business: a place where making a contract and signing up to it really means something. If one side reneges on that contract along the way, they can expect there to be consequences. We have already seen examples of that in this Parliament. It would be great to see much more of the processes, attitudes and behaviours seen in business than the opportunism, time-wasting and theatrics that we see far too often in this Chamber. Again, however, we cannot always get everything we want.
There are many things I would like to have seen in the Bill, but many more are included that all sorts of organisations want us to get right. For the Minister’s perusal, here is my Christmas list: an easier route to market for independent generators, a strike price that provides certainty in the market, simplification of energy tariffs, the levy control framework to be implemented in a controlled way, an increase in the small-scale feed-in tariffs threshold for community energy schemes, credible counter-party and contract terms that are fit for purpose, and a binding EU-wide emissions reductions target of 50% by 2030. It is not a long list.
Last year—I thank the Secretary of State for this—I got a green deal that is set to support 60,000 installation jobs this year, up from 26,000 in 2012, and a green investment bank investing £635 million in green infrastructure projects. If, at the end of this legislative process, I get everything on my list, I will say thank you again. I am damn sure that I do not intend to be the spoilt child stamping my feet and whining, “But I didn’t get my decarbonisation target,” because, after all, if I got everything I wanted this year, what would I ask for next year?
Dr Whitehead
I trust the hon. Member for Edinburgh West (Mike Crockart) will support a number of later amendments on demand-side reduction and routes to market for independent generators and community energy. He put his finger on some of the problems that several people have been grappling with as the Bill has made its way through the House.
It is very odd that when the Bill first made its way to this House in draft form it had no target in it, and yet it was all about low-carbon electricity, routes to market for low-carbon energy generators, the future of large-scale low-carbon energy and how that might be supported to play a much increased role in our energy mix over the next few years, and how the whole electricity market would be decarbonised over the next period in line with what DECC had previously published as its plans for a radical decarbonisation of the electricity market over that period. The Bill was the embodiment of how those changes would be made—how, over the next period, our energy markets, particularly our electricity market, would radically change how they move forward and how they supply energy to us. The Bill also contains emissions performance standards that reduce the emissions that plant may make, also in line with the decarbonisation of our energy over the coming years.
It is blindingly obvious that a Bill of that kind should have a target at the front in order to underpin all the other things that it is doing. Not having that target is rather like someone carefully strapping a belt around their waist and then sallying forth having forgotten to put on the trousers that the belt was supposed to be supporting in the first place. When the Bill first arrived, the lack of a target was a puzzle to a large number of people. In a sense, the hon. Member for Edinburgh West has started to unpick some of that puzzle. As my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) outlined, we know from what the Secretary of State has said to the Energy and Climate Change Committee on more than one occasion that he was very keen on having a target in a Bill and was engaged in work on that target, the details of which he could not yet vouchsafe to the Committee.
In fact, the Secretary of State was engaged in discussions with the Treasury about what might go at one end of the Bill and what might be negotiated away at the other end to secure the things that he thought were quite important, relating particularly to supporting low-carbon energy in the way that I have described. The result, as we discovered fairly recently, is the announcement of the extension of the levy control framework from 2015 to 2020, with a figure increasing from the current amount of £2.3 billion to, allegedly, the whopping figure of £7.5 billion in 2020.
We need to be rather careful about immediately jumping for joy about that aspect of the negotiation, because as soon as we unpack the figures we realise that each year the levy control framework takes along with it the accumulated underwriting of whatever has been commissioned in the year before. That means that by the time we get to 2020, the accumulated contracts for difference, or ongoing renewables obligation certificates, that are caught up in the £7.5 billion make up a good proportion of the total. The actual amount of support contained in the levy control framework up until 2020, per year for new entrants—that is the key thing to look at in terms of the development of low-carbon energy, particularly round 3 offshore wind and the like—turns out to be not much more than is being undertaken at the moment. The idea of its ending up at twice the current level is rather belied by the figures in the levy control framework. Nevertheless, the Secretary of State felt that he had got a good deal.
It is not, however, a particularly good deal and it is clear that the inclusion of a target in the Bill was sacrificed. A belt and trousers had not previously been available, but on 5 February—halfway through the Committee stage—the Secretary of State came along with the belt that had resulted from the discussions. As hon. Members have said, as a result of the discussions, although the Secretary of State could not set a target before 2016, he could set a target at various levels that could be considered then. Indeed, the Minister has made great play of the argument that we will need to have all the facts at our disposal with regard to the future state of the universe in order to decide how we might set a target.
A couple of important things need to be considered during the intervening period. First, the gas strategy set out by the Department of Energy and Climate Change over a number of years assumes a relatively low level of gas over the long term and, while it views gas as essential, it sees it as a back up for other, renewable forms of generation. The recent gas strategy includes an option to reverse that approach and puts gas at the centre of a future strategy. It includes gas plants running at maximum capacity, grandfathered for a long period and playing the main role—not the back-up role suggested by the low-carbon strategy exemplified by the Bill—in energy generation.
Explicit within that gas strategy is the need to take a decision in 2014. The strategy specifically says that, depending on what happens in Europe, a decision will have to be made as to whether to increase the carbon target. Accommodating the strategy could therefore result in a target of about 200 grams of emissions per kWh by 2030, rather than the 100 to 150 grams envisaged previously by the Department and endorsed by the Committee on Climate Change. A significant decision might be taken in 2014—way before 2016—which could blow the potential 2016 target out of the water.
Secondly, regardless of the negotiated outcome, the levy control framework has been extended to 2020, but we have not heard what will happen beyond then. There has been no indication of what support might be given to low-carbon energy after 2020. There is a cliff face.
Mark Reckless
Is not the reason for that that the levy control framework and the contract for difference required to back it up are really aimed at meeting the 2020 target of the European renewables directive, rather than the 2015 carbon target?
Dr Whitehead
The hon. Gentleman makes an interesting point. It may well be the case that the specific mechanism of the levy control framework relates to meeting that target.
As I have said, I am not sure that the framework as it stands addresses the target in the way we might think. Nevertheless, in order to achieve the target, those companies investing in new, renewable, low-carbon plants, offshore wind and all sorts of other low-carbon arrangements that are at the heart of the Bill have to start on the work now on projects that will come on stream in six, seven, eight, nine and 10 years’ time. However, those companies, which are at heart of the engine of this Bill, will not do that under the current circumstances, because they have to take decisions now and if they see that they will face a cliff face of some height in 2020, they may well decide that they do not want to use their initial investments for that purpose because there will be no business for them after that time.
Mark Reckless
I am pleased to follow the hon. Member for Southampton, Test (Dr Whitehead), but I am not sure whether I agree with him about the logic, let alone the coherence, of the Bill or the amendment. He says that many hon. Members will want to vote for the amendment for logical and coherent reasons, but I do not believe that that is so. Many hon. Members—a very high proportion—although rather less of my constituents vote almost always on the green side of any argument. They vote almost ideologically—they support the greener side of any issue under discussion. The problem with that approach is that it has led to a network of legislation and other commitments in this country that are internally incoherent and make no sense. Instead of hon. Members looking at the matter in the round and seeing how they could best obtain their overall objective, be that decarbonisation or otherwise, they support each and every of various, disparate initiatives that add up to a whole that does not make sense, even in terms of those objectives.
Those promoting the amendment say that they want to bring certainty for investors, and yet the Minister, too, says that that is his objective. The Minister mentioned that he wanted to protect and insulate consumers from price spikes. The problem is that the method by which he seeks to do so, and administers in the Bill, locks in high prices, so that for a very long period, whatever the uncertainties, our consumers will be locked in.
The primary purpose of the Bill is not the decarbonisation of electricity, but to set up the contract for difference model that allows the Government to sign long-term and very expensive contracts with all manner of energy producers—the Government will pick winners through an opaque process—and give certainty to investors that our consumers will be forced to pay those prices and have them added to their electricity bills throughout the length of contracts that could contain a change-of-law clause that it might not be possible to unpick in future should we want to do so. That is what worries me about the Bill. We are changing the pie-in-the-sky, Alice in Wonderland policy objectives that the previous Government proposed—only four or five current Government Members voted against them—but we can undo a Government policy objective for 2050 if we find that it does not make sense or is overly expensive. This Bill, however, essentially makes such a reverse undoable because it moves the policy from the sphere of legislation to that of contractual commitments.
It is sensible that the control levy framework is scored as public spending—I welcome the fact that the Government and the statistics office have ensured that. However, under the framework, the plan is to increase the cap on spending from £2.35 billion to £9.8 billion by 2020. All hon. Members who have spoken in the debate have said that the sum is £7.6 billion, but it is not. The sum is £9.8 billion, unless we say, “It’s £7.6 billion in real terms from a previous year.” Our constituents will pay £9.8 billion in 2020. For most of our constituents for the past few years, wage increases have been lower than price increases.
Mr Douglas Carswell (Clacton) (Con)
Does my hon. Friend agree that there is a danger that the Bill could mean that poor folk in constituencies such as mine are priced out of heating their homes in order that rich people in London can feel good about supposedly saving the planet?
Mark Reckless
Yes, there is an element of that. Moreover, we will be unable to do anything about it, because a future Parliament will be stuck with the contracts.
I fear that the sum might be larger than the £9.8 billion. Policy Exchange has released a well-considered analysis that adds up the total additions to gas and electricity bills within the levy control framework to £16.3 billion. Even that does not take into account two significant factors: first, the carbon tax floor, which is a tax and not in the levy control framework, which applies to spending; and secondly, the cost of banning coal production—coal production will be banned by shutting down plants through the EU directive, and through the domestic and unilateral legislation to ban the construction of new coal-fired plants. We could be looking at amounts equivalent to 4p, 5p or 6p on income tax.
Almost all hon. Members seem to be prepared to drive that measure through, but almost all of my constituents that I speak to do not want to pay those amounts on their electricity bills. We are forcing the measure through. Obviously, lobbyists and the industry understand this complex area, but it is important that Members get to grips with the Bill and the extent to which CFDs will drive higher prices. The more I understand the Bill from the point of view of my constituents, the less keen I am on it.
The amendment confuses two issues, the first of which is the Climate Change Act 2008 commitment to an 80% reduction in carbon gases by 2050. The commitment applies to the whole economy, but the amendment seeks an electricity decarbonisation target. The Minister persuasively drew attention to that inconsistency. If we are looking to hit the 80% reduction target in 2050—the target strikes me as an enormously ambitious and costly one, and I doubt it will be met—we need to decarbonise large sections of the economy, and not just the electricity sector. As part of that, we must persuade significant sections of the heating and transport sectors to convert from current fossil fuels to electricity. However, the amendment would accelerate the decarbonisation of electricity still more, which will shove up the cost of electricity so much that it will be hugely unattractive for those sectors to switch to electricity from their current fossil fuels. Therefore, even on its own terms, the electricity decarbonisation target risks setting back its avowed goal of helping towards the purported 2050 target for the decarbonisation of the economy as a whole.
None the less, one might say in the amendment’s favour that it potentially exposes the contradictions in current policy. We have heard a lot of the “grand bargain”. The hon. Member for Edinburgh West (Mike Crockart) was honest in setting out how much the Lib Dems have gained from it and how little they have given up in consequence. I do not, on balance, support the amendment, but I am not sure why the pass has been sold on so many other issues to avoid having to make a decision in 2014—we are quite happy to kick it down the road and make it in 2016.
The inconsistencies in the proposals are significant. The hon. Member for Brent North (Barry Gardiner)—I am pleased he is still in his seat—suggested that it would be cheaper to go down the route of renewable electricity rather than electricity largely from gas. He cited a Committee on Climate Change report, but did not mention the basis of its calculation. The report states:
“Beyond 2030, bills would fall in a low-carbon system as new low-carbon capacity is commissioned at lower cost than the older capacity (assuming learning in deployment leads to cost reductions). In contrast, for a system with a major share of generation from unabated gas, bills would continue to increase as carbon prices continue to rise.”
The basis of his argument is predicated on the assumption that the massive carbon tax will rise—that is within the system, but also endogenous to his own model.
Barry Gardiner
Had the hon. Gentleman paid attention, he would have noticed that I mentioned the basis on which the Committee on Climate Change made its assessment. The Committee concluded that we could assume that the price of carbon will not continue to rise only if the rest of the world gives up its aspiration to avoid dangerous climate change. Only in that scenario could it make economic sense for the Government to pursue the strategy he suggests.
Mark Reckless
On both the occasions that I sought to intervene or have an exchange with the hon. Gentleman, he replied that the problem was my failure of understanding rather than his failure of explanation. Might we perhaps together put on the record the key facts behind that assumption?
Barry Gardiner
The hon. Gentleman has made an important point, so I want to respond to it. He will, I trust, have read the Committee on Climate Change report on EMR, in which it states:
“This conclusion”—
the conclusion that he has just rubbished—
“is robust when possible impacts of shale gas on the gas price are accounted for. Shale gas could play a role in the gas mix that helps to balance intermittent power generation, and meet demand for heat, provided appropriate environmental safeguarding regulations are put in place.”
Mark Reckless
Yes, it is robust in that sense, but the reason it is robust is because almost any conceivable change in gas price is completely swamped by the enormous increase in the carbon tax from £16 now—and less than £2 in the ETS—to up to between £200 and £500 per tonne by 2050. Of course the conclusion is robust. If we assume that there will be a massive tax on carbon, it will be cheaper to have lower carbon rather than higher carbon, but so what? CFDs are included in the Bill, but they have virtually nothing to do with this amendment. We keep on hearing that it is about electricity decarbonisation, but it is not. That was only inserted in the Committee stage of the Bill.
The amendment is about hitting the renewable energy directive for 15% of all energy production in this country—not just the electricity sector, which makes up approximately a third—to be from renewables by 2020. However, that will set back decarbonisation across the whole country, because it is a very expensive way to decarbonise. All the savings we can make through energy efficiency, better insulation of people’s homes, or, I hope the Minister will not mind me saying, through different lighting that saves money across the network, are no good or will only work on the denominator, because we are forced to hit, by 2020, the 15% renewables target—33% of electricity—set by the EU Commission. That will be grotesquely expensive and will lead not to innovation in low-carbon technologies, but to the rolling out of fairly mid-tech current generation onshore and offshore wind at twice the price. That will absorb a huge proportion of the £9.8 billion and lead to very little advance in technology compared with what we could do with proper R and D focused activity. That will happen not because of decarbonisation, but because the EU directive that states that this must be done through renewables.
Domestically, we are making the situation even worse by inserting further restraints, such as a 12.5% cap on biomass. One way to get closer to hitting the EU target is to use dual firing, where half coal, half wood pellets emit approximately the same amount of carbon as gas, earning a half-renewable credit on the real constraint, the 2020 EU target. We are not allowing that, however. We could pay other countries—Germany, Spain and perhaps Poland—to do a lot of those things far cheaper than we could do them ourselves. We have a new Government in Iceland, and £2 billion is the estimate of the capital cost of an interconnector to Iceland for its renewable electricity. These measures are not being considered. Even if the objective is to reduce carbon, that can be done so much cheaper than the proposals that will be forced through by the Bill, which will be millstone around our constituents’ necks for decades to come.
Ian Lavery (Wansbeck) (Lab)
I understand fully the call in the amendment for the decarbonisation of the energy sector, and for a target to be enshrined in the Bill. What the target should be and whether it would be realistic is debateable. There have been wide differences and many suggestions about what an achievable target might be. If the target is too ambitious, it will be impossible to achieve. We need to bring some form of reality into the debate and forget the pipe dreams of what people would love to see. This is about what we can actually achieve between now and 2030, and between now and 2050. Is it achievable to decarbonise the energy sector to the degree of 50 grams of CO2 per kWh? That is one suggestion, and I am sure that plenty of Members believe that that is achievable. I find it difficult to believe, however.
Unlike the hon. Member for Edinburgh West (Mike Crockart), who had a shopping list of issues he wanted to discuss today, I want to focus on carbon capture, coal burn and gas burn—fossil fuels. I want to accentuate the positives in burning fossil fuels with carbon capture. I believe, and the expert advice shows, that it can contribute greatly towards an agreed decarbonisation target. The trick is to transfer the high-carbon electricity generation to low-carbon electricity generation. [Hon. Members: “How?”] Carbon capture and storage is the answer. People seem to forget that fossil fuels provide 70%—not 7%, but 70%—of the UK’s electricity supply, and that is set to continue for the short and medium term. Coal burning is set to increase not just in the UK, but across the world, over the next 20 to 30 years. For whatever reason, however, the role of coal, particularly in the UK, is often pushed aside, swept under the carpet, totally ignored. This is done deliberately in the Commons by many Members of Parliament, despite the fantastic role that the miners of this country have played. They have worked hard for many generations, producing the wealth and fuel to generate this country, so it is unacceptable that they should be ignored.
Only three years ago in 2010, the UK market demand for coal was roughly 54.1 million tonnes. That is what we burned in 2010. During the same period, only 18.4 million tonnes were produced here, with a rough 50:50 split between open-cast and deep-mine sectors. Beyond doubt, then, a lot of imported coal is required to meet the nation’s demands. Coal imports have easily exceeded indigenous coal production since 2003. Coal is not going away. It is here to stay, in the UK and globally. We will not be able to persuade the likes of China, India and America to stop burning coal; they are burning coal unabated right now—that is a fact of life.
Martin Horwood
There have been quite a few references to China, but China has set very ambitious carbon-intensity reduction targets, including a 45% reduction in carbon intensity by 2020, so actually it is stimulating huge investment in renewables and low-carbon technologies, including carbon capture and storage. The hon. Gentleman must see the potential in that strategy as well.
Ian Lavery
Absolutely. I fully agree with the hon. Gentleman. The Energy and Climate Change Committee, of which I am a member, visited China the year before last and saw the potential in China. Much was said in the meetings we had, but I would like to see happening on the ground what they said would happen in the future. It is looking not to decarbonise, but certainly to make huge reductions in emissions, and again I will want to see over perhaps 10 years what achievements can be made. I hope that it happens.
Martin Horwood
On the latest figures, China is ahead of target on those carbon-intensity reductions, so it is happening on the ground as well.
Ian Lavery
I am sure that the hon. Gentleman is correct, but it would not be too difficult in China to make a little headway, given how much carbon it produces. The trip to China was a learning experience. I am sure that other Members present were on that delegation. I think we ought to focus on its proposals for renewable energy, carbon capture and storage and the rest and take a leaf out of its book, although I will want to see how much progress it makes in the not-too-distant future—perhaps five or 10 years.
The amendment is concerned with coal and decarbonisation. At the same time as importing huge amounts of coal from Russia, China, South Africa and Australia, we have allowed our coal industry to be destroyed. The Minister might wish to refer to that. Only a couple of months ago, there was a big fire at Daw Mill colliery, one of the biggest collieries in the world, and the situation still has not been remedied, despite the Government’s promises to look after that and, with UK Coal and Scottish Coal, the open-cast mines in what is left of the UK coal industry.
Katy Clark (North Ayrshire and Arran) (Lab)
I congratulate my hon. Friend on the points he is making, which are not often made in this place. In my constituency, we do not produce coal, but we import it, mainly from Colombia, through Hunterston. There was a proposal to build a new coal plant at Hunterston, but that might not be going ahead now. It would probably have been a carbon capture plan using predominantly imported coal, because, I understand, the types of coal produced in Scotland probably would not have been suitable. I know that he is a strong supporter of carbon capture. How do we ensure that we use indigenous coal?
Ian Lavery
That is an excellent and important point that I will come to shortly. We have understood for generations that we closed profitable coal mines the length and breadth of the country, knowing full well that carbon capture was in the background. We have done nothing to protect the British deep-mining coal industry, and that has cost thousands and thousands of jobs. We have dillied and we have dallied with carbon capture and storage, including over the past three or four years. The first announcement was made by the previous Labour Government, who committed themselves to carbon capture and storage in 2007. Where is it? It is not here. It has been kicked into the long grass.
My view is simple. We should look to exploit the coal reserves up and down the country, with carbon capture and storage onsite and with clean coal power stations. That would decarbonise the electricity sector and go a long way to ensuring that we can meet the targets. It might even mean that we could reach 50 grams of CO2 per kWh. I am not too sure about that, but it is the answer. The demand for coal is significant here. Electricity consumption is set to increase, as is the consumption of coal, but as mentioned by several Members on both sides of the House, by 2015 approximately 9,000 MW of coal-fired plant is to be closed down, as a result of the large combustion plant directive, so the UK will become increasingly dependent on imported gas for electricity and domestic heating purposes.
What impact will the burning of gas have on our ability to meet our targets? People do not want to recognise that gas is a fossil fuel—coal is not the only fossil fuel—and emits just less than the suggested emissions performance standard of 450 grams per kWh, so when we talk about allowing gas to be burnt unabated, we must think of the consequences. It will mean that we will be unable to achieve any of our decarbonisation targets for 2030 or 2050.
Do people in this Chamber believe that shale gas will be the answer to our problems? Too many questions need to be asked about shale gas, although we need the general public to support it before anything else. There are a lot of problems with fracking. What is the cost of exploitation? We do not know what it is. Is it safe?
Ian Lavery
What are the emission levels? I am not saying it is not safe, by the way; I am saying that there are a lot of things we need to get right. As a member of the Energy and Climate Change Committee, I support the fact that we have said that the exploitation of shale gas should not have been delayed, but should have gone ahead months ago, if not a year ago.
Sammy Wilson (East Antrim) (DUP)
I have listened to the hon. Gentleman’s arguments. Does he accept that in America, shale gas has been not only exploitable, but exploitable at reasonable prices? It has turned the American economy around, to the point where manufacturing that had been outsourced to other parts of the world is now being brought back to America because energy costs have been reduced.
Madam Deputy Speaker (Dawn Primarolo)
Order. Decarbonisation is the focus. While I am on my feet, I would also like to gently remind all Members in the Chamber that this debate will end at 4 o’clock. The mover of the amendment will get a few minutes at the end, but a lot of Members who have been sitting in the Chamber all this time are still waiting to speak, so may we have some consideration to get them in as well?
Ian Lavery
Thank you, Madam Deputy Speaker. I understand exactly what you are saying. I waited four hours yesterday and did not get called, so excuse me for perhaps saying a little more than I intended to.
Madam Deputy Speaker
Order. My comment was not directed at you, Mr Lavery, but sitting in the Chamber all day yesterday does not necessarily qualify you for that. I was referring to the number of interventions by some who have already spoken and by those who have not been here all afternoon—and the fact that you have been on your feet for some time. I was just trying to help you along and explain the shortage of time.
Ian Lavery
Once again, thank you very much for your guidance, Madam Deputy Speaker.
The shale gas issue, which the hon. Member for East Antrim (Sammy Wilson) referred to in his intervention, is important. By the way, the situation in the USA is completely different from what might happen in this country. I hope that shale gas is everything that everyone wants it to be—no one would be more pleased than I if it was. We are looking, but if we are to achieve our targets, we have to get carbon capture and storage. We have to be serious and urgent about it if we want to decarbonise the electricity sector. There is no other way to do it. Coal power plant with CCS can diversify the UK’s fossil fuel requirement and, in addition, deliver national security of supply.
In summary, as I have explained—I am not sure whether I have explained it enough—fossil fuels provide 70% of the electricity generated in the UK, and that is likely to continue. Fossil fuels represent a major source of CO2, and CCS is a key technology that enables fossil fuels to become a low-carbon source of electricity. Fossil fuel electricity generation is not subject to the intermittency of renewables or the inflexibility of nuclear, is an important tool in meeting variations in demand, and, with carbon capture, will allow the UK to maintain diversity of fuel and energy sources. Fossil fuel with carbon capture and storage would undoubtedly enable the UK to decarbonise, in line with so many people’s hopes and aspirations. The message from me is quite simple. The Government need to stop dithering over carbon capture and storage. They should give equal importance, attention and focus to CCS as they have to securing nuclear power into the future. We should support the British deep-mine coal industry or forget any ambitions to meet the target of a decarbonised UK by 2030.
Peter Aldous (Waveney) (Con)
At the outset I should draw attention to the Register of Members’ Financial Interests. I have interests in family farms in Suffolk where renewable energy projects are being pursued. However, this afternoon I shall largely concentrate not on land, but on the coast and developments at sea, with a focus on the nuclear industry and, predominantly, the offshore wind industry.
My Waveney constituency, Britain’s most easterly constituency, stands to benefit from some of the larger projects that will hopefully flow from the Bill, such as the construction of the Sizewell C nuclear power station in the constituency of my hon. Friend the Member for Suffolk Coastal (Dr Coffey) and the development of the East Anglia Array, the largest round 3 offshore wind farm, for which Lowestoft, the largest town in my constituency, is the nearest port. These projects provide a once-in-a-lifetime opportunity to bring jobs and prosperity back to an area that has been hard hit in the last 30 years by the dramatic decline in the fishing industry, the closure of factories and the rise of package holidays, which has hit the domestic tourism industry. If we can build a strong domestic supply chain for low-carbon energy generation, we will have an opportunity to reverse that decline and properly rebalance the economy. This opportunity is not restricted to East Anglia, but is repeated all around the coast of the British Isles. To me, the issue before us in this debate is the role that having a decarbonisation target in the Bill could play in building a domestic supply chain and creating jobs.
It is important to emphasise that there is broad agreement, at least between the Front-Bench teams, on this Bill’s direction of travel—the promotion of a mixed energy supply economy with appropriate demand-side measures. This collegiate approach is needed to attract much-needed investment—an estimated £110 billion by the end of this decade and £330 billion by 2030—in the UK energy sector. For the Government and the Opposition to be singing from completely different hymn sheets would have unnerved investors and seen them fleeing these shores. Instead, despite differences, largely of emphasis, most of the feedback that I receive from industry is that the British energy sector as a whole is a good place to do business. What we are debating is what needs to be done to make it the world leader—the come-to place.
In considering whether there should be a decarbonisation target in the Bill, I have had regard to the evidence and opinions provided by a wide variety of colleagues, local and national businesses, and non-governmental organisations. Let me go through some of these; there are differences of opinion between some of them. The CBI is of the view that the most important factor driving investment decisions is electricity market reform—the proposals in the Bill on contracts for difference, the capacity mechanism and the levy control framework. It is vital that this debate on the decarbonisation target should not hold up the Bill’s receiving Royal Assent. Electricity market reform will be the main catalyst for the investment we all seek. Likewise, it is important that the draft strike prices are published on time next month.
I take note of EDF’s findings. EDF, too, emphasises the importance of a decarbonisation target not preventing the Bill from passing through Parliament in a timely way. EDF expresses the opinion that if such a duty is to be provided for, it should be in secondary legislation, subject to adjustment in the light of new evidence. That would help to ensure that the required pathway to 2050 is realistic and deliverable. I am also mindful of the importance of a Europe-wide target and the need for agreement at EU level. The EU emissions trading scheme should be the key target in decarbonising European economies.
The issue that especially concerns me is that if no target is provided before 2016, investors’ uncertainty will be prolonged. There is a particular risk to the investment in round 3 projects, from which my constituency and East Anglia have the opportunity to benefit through economic development providing new opportunities for local businesses and creating new jobs.
The forthcoming publication of the offshore wind strategy is welcome, but the feedback that I receive from industry is that, on its own, it might not be enough to maximise inward investment. I have studied closely the Committee on Climate Change’s recent report, and in particular its conclusion that a decarbonisation target would help to deliver savings of £25 billion to £45 billion on consumer energy bills. Further, it emphasises the need for a strong signal about the future direction of travel in order to support supply chain investment, which has long payback periods, and the development of new projects that have long lead-in times. There is a risk that, owing to a lack of visibility beyond 2020, supply chain investment and project development might not proceed, as the Government have not yet clearly set out their intentions for that period.
In considering energy policy generally, regard should be given to three factors: affordability, security of supply and environmental responsibility. At this time of prolonged economic downturn, there is a fourth: the opportunity to promote economic growth and attract inward investment in order to rebalance the economy towards the regions in favour of engineering and manufacturing and to create jobs.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. We still have four speakers wishing to speak in the debate, as well as Mr Yeo, who I am sure will want to speak briefly again at the end. I call Mike Weir to speak, ideally for four or five minutes.
Mr Weir
I strongly support the amendments in this group. It is imperative to decarbonise the energy sector, and I believe that including a decarbonisation target in the Bill would give a clear and unmistakeable message that we intend to do so. The first reason for adopting such a target is that we must reduce our carbon emissions. The energy sector is a major contributor to carbon emissions and the Committee on Climate Change has made it clear that decarbonising power is the cheapest way of meeting our overall carbon budgets.
There is, at best, a mixed message coming from the Government on how they intend to proceed with the decarbonisation of energy. In the Bill Committee, witnesses told us time and again of the need for a decarbonisation target to ensure that a clear message was sent to those involved in the industry. The mixed message coming from the Government could seriously harm our efforts to attract not only new renewables generation but, crucially, the supply chain that will ensure that we reap the economic benefits and the jobs that go with them. In opposing the decarbonisation target, Ministers have made the point that other nations do not have such a target. That is true, but many of those countries are already ahead of us in creating a supply chain that can supply investment in renewable energy in their territories. We are trying to attract that supply chain here and to ensure that it is established so that we do not simply continue to import the infrastructure that we need to create green energy for the future.
Much was said earlier about the situation in Germany. Although it is true that Germany does not have a decarbonisation target, it recently announced a very ambitious 2030 renewable target, which includes 25 GW of offshore wind and a budget of €23 billion. I understand that France, too, is considering moving towards such a target, so there is movement elsewhere within the EU on such targets, and we should not be left behind.
In the evidence session, Danielle Lane of DONG Energy made it clear that the 2020 target is presently at the cliff edge, and that the industry needs certainty about the direction of travel after 2020—a clear sign that after that date there will continue to be a clear commitment from all parties to continue along the route of decarbonisation.
The issue is very important to Scotland, where the development of green energy is a vital part of the revitalisation of our manufacturing industry. It is interesting to note that the Scottish economy has achieved some growth over the last two quarters, much of it through the energy sector. Scotland’s offshore potential is huge—25% of the entire European potential. If we are able to harness that, we could attract billions of pounds-worth of investment and create tens of thousands of highly skilled and sustainable jobs. Indeed, Scotland’s offshore wind route map outlined the potential for £30 billion-worth of investment with up to 28,000 direct and 20,000 indirect jobs by 2020.
We already have strong offshore experience in the oil and gas industry, particularly in the north-east, and many of these skills could be transferable to new offshore renewable energy developments. I would cite the example of offshore wind, which I believe has a strong vibrant future. There are plans to install up to 10 GW of capacity in Scottish waters over the next decade, including three projects off the coast of my Angus constituency. Many more sites, alongside commercial wave and tidal generation, are being looked at for deployment in the 2020s. We must ensure that we send a clear and unambiguous message that we want these developments, and that we will continue to push for the decarbonisation of the energy sector.
It is important to set the targets now because companies are looking at long-term investment. It will be many years before these investments come on stream, but the decisions affecting 2020 are being looked at in the boardrooms now, and if we delay in putting forward our plans for decarbonisation, we may well lose out on all the potential.
Over the last few years, both private and public investment has been made to help stimulate sustainable, long-term growth in offshore renewables, including developing the technology. The deep waters off Scotland’s shores have specific problems, but many of them have already been tackled by oil and gas development, which might point the way to dealing with offshore wind arrays and onshore development at our ports such as Dundee and, in my own constituency, Montrose. That development, however, is based on the assumption of having a long-term stable market for manufacturers.
Firms such as Gamesa, Areva, Mitsubishi and Samsung have indicated an intention to establish manufacturing plant in Scotland in order to meet the expected opportunities for offshore wind development. The difficulty we face with this Bill, however, is that we can be sure of funding only up to 2020—and then, as DONG Energy says, we face the “cliff edge” of uncertainty. Many of those who are considering investments do not feel that there is sufficient reassurance of a long-term market for their products beyond that date, which could lead them to reconsider or delay any decisions on investment. Such delays could lead to a significant loss to the economy and check ambitions to create a new greener manufacturing base, especially when, if companies decide to go ahead within the compressed time that is certain, there would be a considerable shortfall in the ability of UK-based manufacturers to meet the demand for turbines, which will inevitably lead to the importation of much of the infrastructure, creating jobs elsewhere but not in Scotland.
I finish on the point that decarbonisation is important not just for climate change benefits, but for the real economic benefit of creating sustainable jobs for the future.
Guy Opperman (Hexham) (Con)
In the north-east, energy in all its forms concerns my constituents almost more than any other issue. Whether it be fuel prices, energy prices, the role of wind, biomass and nuclear, opencast mining, the renewable heat incentive, solar, off-grid, liquefied petroleum gas, heating oil, gas or electricity prices, not to mention the role that climate change should play—these are all key issues for the people of Hexham.
It is definitely the case that the Government have a fundamental duty to keep the lights on and to lift the people of the north-east out of fuel poverty. Like the hon. Member for Wansbeck (Ian Lavery), I inherited a situation in which 24% of our population were living in fuel poverty. It is a situation that has sadly not improved that much, although I applaud what the Government have tried to do. I especially welcome the work that they have done on fuel prices, and their support for household energy.
In case I am required to do so, I make the declaration that I am a member of the all-party parliamentary group on off-gas grid and the all-party parliamentary group for the wood panel industry, and that my constituency contains employers in the timber industry.
I entirely accept that our desire to reduce carbon consumption is often incompatible with a reduction in energy prices. The fact is that renewable energies are not as efficient as coal, oil and other fuels, which often has the knock-on effect of increasing energy prices. Anyone who doubts that should read the maiden speech made by Lord Ridley in the other place last month. Notwithstanding the competing difficulties with which the Government have to deal, carbon reduction and renewable energy obligations will continue to be met, and energy companies will be required to place gas and electricity consumers on the cheapest tariffs.
I welcome the Government’s efforts in relation to the green deal, about which I should have liked to say more. It is having a considerable impact, although we need it to trickle down to local suppliers, too few of whom are providing it on an ongoing basis.
I applaud the efforts made to deal with fuel poverty through the buy oil early campaign, and look forward to doing my bit later in the year. However, it has been put to me that the success of the campaign would be massively increased if winter fuel payments were made earlier in the year, when oil is much cheaper—hypothetically, on 1 August.
Having listened to what was said about decarbonisation by my hon. Friend the Member for South Suffolk (Mr Yeo), I am sadly not persuaded. This is a debate that has seen the hon. Member for Edinburgh West (Mike Crockart) charge, with Tennyson, to the redoubts of Sebastopol, and also to the shifting climatic sands of South Suffolk. The hon. Member for Rutherglen and Hamilton West (Tom Greatrex) disparages the Secretary of State and sees him as the political equivalent of Queens Park Rangers, but fails to add that Hamilton Academical are not exactly in the champions league.
It strikes me as entirely sensible for the decarbonisation target to be set after the Energy and Climate Change Committee has provided its advice on the fifth carbon budget in 2016. However, while I support the Government’s strategy of shifting away from oil and decarbonising, we must be careful not to rely excessively on wind energy. The hon. Member for Wansbeck and I face twin problems in that regard, because the Northumberland area is being randomly covered with wind farms. There is no proper strategy and no local development plan, and our constituents are not encouraging the move in any way.
I urge the Government to address the future role of wind, and also that of biomass. The continuing domestic subsidy for biomass is having an impact on the jobs of all utilisers of wood. It means that the demand for timber from energy companies increases, and so too does the price. The subsidy gives those companies a competitive advantage, enabling them to purchase timber more cheaply than any other provider in the country. I repeat my calls for the subsidy to be scrapped, so that the wood panel industry—and, indeed, anyone who utilises timber—can compete on a level playing field, while continuing to decarbonise.
The Bill should be strongly supported. I shall vote against the Labour amendment—[Interruption]—which, I hasten to add, is also the amendment of my hon. Friend the Member for South Suffolk. I should have liked to include many more items on my wish list—much like the hon. Member for Edinburgh West—but, in the interests of satisfying you, Mr Deputy Speaker, I shall end my speech.
Albert Owen
It is a pleasure to follow the hon. Member for Hexham (Guy Opperman), although I am disappointed that he will not be joining us in the Lobby.
Many of those who oppose the amendment have tried to suggest that it is pro-wind, but it is not about wind energy. I am proud to put on record that I am pro-nuclear, pro-renewables and pro-energy efficiency. I see no contradiction in holding those three views, because I want to decarbonise the economy, but I do not want to do so only for the sake of decarbonising it. Many Members who support the amendment are not—the hon. Member for Rochester and Strood (Mark Reckless) has just left the Chamber—just ideological greens. I consider myself to be a practical environmentalist. I want to see the environment looked after properly, quality jobs in this country, and the promotion of quality jobs in the energy sector. I want to see our country become the world leader in all forms of new generation. I want to see us, as pro-nuclear, being the forerunner in that new technology. There is also great untapped marine energy potential in this country, and I want it to be unlocked. The Bill offers a good mechanism for doing that.
Julie Elliott (Sunderland Central) (Lab)
I support the comments that my hon. Friend the Member for Ynys Môn (Albert Owen) and other colleagues made about the hon. Member for South Suffolk (Mr Yeo) and his introduction of this amendment.
Investment in clean energy and policies to keep the lights on go hand-in-hand. We need a commitment to decarbonising the power sector by 2030 not just to combat devastating and unpredictable climate change, but to keep energy prices down and the economy growing into the second half of the 21st century. The idea that there is a binary choice between a firm commitment to green energy and keeping energy bills down is clearly a false dichotomy. Decarbonisation is fundamental to keeping energy prices down in the long term; the alternative is to remain at the whim of unpredictable yet ever-rising global fossil fuel prices.
It is therefore shocking that investment in green energy has fallen in every year since this Government came to power. At current rates, investment in 2013 will be at its lowest level since 2006. This is not just a case of “not good enough”; it is an utter dereliction of duty. The Government, riddled by indecision and infighting, are deterring investment, stopping Britain becoming the leader in Europe on renewable investment.
At the evidence stage of this Bill, I asked the Secretary of State whether he agreed with his party’s position of wanting a decarbonisation target in the Bill. He said that he did but we have a coalition Government, which therefore meant that it was not going to be there—that says it all. This issue should be beyond party politics. I welcome the fact that the hon. Member for Waveney (Peter Aldous) has decided to support the amendment, and I understand that the president of the Liberal Democrats, the hon. Member for Westmorland and Lonsdale (Tim Farron), and their former leader, the right hon. Member for Ross, Skye and Lochaber (Mr Kennedy), are going to support it, too. I urge other Liberal Democrats, who have the choice at 4 pm as to which way to vote, to support the amendment, in line with their party policy.
This Government rightly decry short-termism, and we all support a long-term plan to improve British competitiveness and boost growth, which is why it is so disappointing that the Government cannot recognise the crucial long-term benefits of a 2030 decarbonisation target. Long-term strategy is even more crucial in energy policy, where large fixed costs must be met. Investors’ cash, which we know is highly mobile, relies on a strong and unwavering vision from the Government. Without such a vision, the UK has slumped to seventh in the world for investment in clean energy, and for the first time we are no longer ranked first globally for offshore wind attractiveness.
Decarbonising the power sector by 2030 is not just an important part of our legally binding commitment to reducing the UK’s carbon dioxide emissions by 80% by 2050—it is the totality of it. The Prime Minister once recognised that. In 2010, he told the Liaison Committee that
“if we don’t decarbonise electricity, we’ve got no hope of meeting all the targets that we are all committed to”.
I entirely agree with the statement, but, unfortunately, the Prime Minister seems to have abandoned that.
The case for a 2030 decarbonisation target is about more than preventing catastrophic climate change. There is an irresistible business case for these amendments, and it can be summed up in one word—jobs. The renewable industry currently supports 110,000 jobs and, across the supply chain, it could support 400,000 jobs by 2020. In 2012, the CBI estimated that nearly one third of the insufficient number of jobs created in the UK came in the green sector. Two thirds of jobs providing low-carbon and environmental goods and services are outside London and the south-east. Furthermore, if we use the BIS definition of “low-carbon environmental goods and services”, we find that the largest activity in the sector is manufacturing, with 20% of total sales and employment, as opposed to a figure of 13% for the economy as a whole. In 2010-11, green business grew by 2.3% in real terms, outstripping global growth, yet this Government’s dithering is scaring off investment in an industry worth £3.2 trillion.
Jobs, rebalancing the economy and economic growth are three pillars of this Government’s agenda that would be boosted by a decarbonisation target. It is at times of economic stagnation—this economy is certainly not booming—that investment is at its most economically productive. With interest rates at near zero, the Government should be prioritising investment in decarbonisation. That the “greenest Government ever” claim they want to decarbonise the economy but will not support a 2030 decarbonisation target is simply bizarre. Without such a target, I am deeply concerned that this Bill will not give investors the confidence we know they need to invest in low-carbon generation in the UK.
Mr Yeo
I pay tribute to everyone who has taken part in the debate and thank you, Mr Deputy Speaker, for the opportunity to comment briefly on what has been said. I am particularly grateful to members of my Committee who have spoken and although their full tributes have done great damage to my career prospects, they are much appreciated nevertheless—[Hon. Members: “What career prospects?”] Okay, I accept that.
I am particularly pleased that most of those members maintained the position that the Committee took last summer when we reported on the draft Bill and made a unanimous recommendation about the need for a target. My right hon. Friend the Minister set out the Government’s position very powerfully. I do not think that there was any doubt about his reasons for opposing the amendment, but nothing he has said has explained to me what, if the Government remain as serious as he says they are about meeting the fourth carbon budget, which takes us to 2027, and progressing further towards the 2050 target, the objection is to accepting now rather than in three years’ time the advice of the Committee on Climate Change about a 2030 target for decarbonising electricity generation. That seems to me to be completely consistent with everything he said.
My right hon. Friend also had some perhaps predictable fun about press reports of an answer I gave at something called the Westminster Russia Forum last week, but I am not sure that he attempted to understand the intervention I made during his speech. I do not doubt, and I have not doubted for 20 years, that the man-made increase in greenhouse gas concentrations in the past 200 years as a result of the industrial revolution is extremely likely to be the cause of the changes in the climate that we are now observing.
Leaving that to one side, however, I want to reiterate that unlike a great many people who argue about the science of climate change I see it in an historical context. The human species is one of the most recently arrived on the planet and the phenomenal success of the species—our proliferation in numbers and our control over our destinies to an extent that perhaps no other species has ever achieved—has only happened even more recently than that. The precondition for that has been climate stability.
Concern was expressed by some hon. Members about the cost of energy. I absolutely share those concerns and it is for that reason that the amendment, which I will press to a vote in three minutes’ time, does not have the effect of raising electricity prices by a single penny for the next seven years. Anyone who is concerned about short-term movements in electricity prices should be hammering the Treasury about the floor price of carbon. That is what is forcing prices up and reducing the competitive position of British industry, not the setting of a decarbonisation target for 2030 on advice from the Committee on Climate Change.
As for what will happen to prices in the 2020s, nobody can be certain, as colleagues have made clear. There is, however, a very strong probability that the cost of various renewable energy technologies will be lower then than it is today, as several are on a very rapid downward cost curve. The pace of that reduction in the price of those technologies might be even faster if the industries concerned have greater certainty that the Government remain committed to reducing dependence on fossil fuels for electricity generation beyond 2020.
There are therefore in my view overwhelming environmental reasons for supporting the amendment, but there are other reasons, too. As I made clear, it will encourage investment and bring down the cost of investment, benefiting consumer prices. By accepting the amendment, the Government would strengthen their claim to be the greenest Government ever. The credentials of all previous Governments are not that strong, so achieving that accolade is probably even now within the grasp of the Government. Accepting the amendment would be a big step towards placing Britain in the vanguard of the new industrial revolution, taking our economy to a position in which it is less dependent on fossil fuels. I am convinced that countries, industries and companies that do that will not only be doing the right thing environmentally but enjoy an economic and financial advantage by improving their competitive position over those countries that remain dependent on fossil fuels in 2030.
For all those reasons, I warmly commend the amendment to the House. I urge all my hon. Friends and, in particular, those on the Liberal Democrat Benches, to join us in the Lobby and do something that will materially improve the Energy Bill.
Question put, That the amendment be made.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
I beg to move, That the clause be read a Second time.
Mr Deputy Speaker (Mr Lindsay Hoyle)
With this it will be convenient to discuss the following:
Government new clause 12—Pilot scheme for electricity demand reduction.
New clause 2—Strategy for electricity demand reduction—
‘(1) The Secretary of State must within 12 months of the passing of this Act publish a strategy setting out policies to achieve a reduction in demand for electricity of at least 103 TWh by 2020 and 154 TWh by 2030.
(2) The strategy must include an assessment of the cost effectiveness of the policies included in it.
(3) Before publishing the strategy the Secretary of State must consult such persons as in his opinion may have information that will assist him in drawing up the strategy.
(4) The Secretary of State must—
(a) implement the strategy; and
(b) report to Parliament every year on progress.’.
Amendment (a) to new clause 2, at end add—
‘(5) Nothing in the strategy shall rely upon the use of the price mechanism to reduce demand.’.
Amendment 1, in clause 10, page 8, line 8, at end insert—
‘( ) Section 41(4)(a) of the Energy Act 2008 (“specified maximum capacity”) is amended as follows: “Specified maximum capacity” means the capacity specified by the Secretary of State by order, which must not be less than 10 megawatts.’.
Amendment 42, page 8, line 8, at end insert—
‘( ) Regulations must—
(a) place a duty on the Secretary of State and the Authority to promote new generation capacity from distributed generation schemes; and
(b) define “distributed generation schemes”.’.
Amendment 43, page 8, line 8, at end insert—
‘( ) In section 41(2)(a) of the Energy Act 2008, at end insert—
“() establishing, or making arrangements for the administration of, a scheme of financial incentives to encourage the distributed generation of electricity;”.’.
Amendment 44, page 8, line 8, at end insert— In section 41(2)(b) of the Energy Act 2008, at end insert—
“() requiring or enabling the holder of a distribution licence to make arrangements for the distribution of electricity generated by distributed generation;”.’.
Amendment 45, page 8, line 8, at end insert—
‘( ) In section 41(2)(c) of the Energy Act 2008, at end insert—
“() requiring the holder of a licence to make arrangements related to the matters mentioned in paragraph () or ().”.’.
Amendment 46, page 8, line 8, at end insert—
‘( ) Section 41(4)(a) of the Energy Act 2008 (“specified maximum capacity”) is amended as follows—
“specified maximum capacity” means the capacity specified by the Secretary of State by order, which must not exceed 50 megawatts.’.
Amendment 47, in clause 15, page 10, line 13, at end insert—
‘(d) conferring on the Secretary of State the power to establish an auction market (the “green power auction market”) in which generators are entitled to offer, and holders of supply licences are entitled to bid for, electricity generated from renewable sources.
(e) the the Secretary of State must exercise the powers in subsection (d), and take such other steps as they consider necessary, for the purposes of ensuring that—
(i) the green power auction market begins to operate when the first CFD is made and does not cease to operate until expiry of the last CFD that has been made; and
(ii) the reference price under a CFD entered into by a generator who is a party to any agreement made through the green power auction market is based on the price payable to the generator under that agreement,
(iii) in this section, “supply license” means a licence under the section 6(1)(d) of the Energy Act 1989.’.
Amendment 34, in clause 21, page 12, line 41, leave out ‘this section’ and insert ‘subsection (1)’.
Government amendment 100.
Amendment 35, in clause 21, page 13, line 6, at end insert—
‘(4A) The Secretary of State must within one year of the passing of this Act make regulations establishing a scheme or schemes to make payments for the purpose of rewarding the installation of energy saving measures.
(4B) Regulations under subsection (4A) are referred to in this Chapter as “demand reduction regulations”.
(4C) Prior to the making of regulations under subsection (4A), the Secretary of State must publish a report setting out the total potential for energy demand reduction and the extent to which this potential will be achieved by Government policies including—
(a) the scheme or schemes, and
(b) other relevant programmes, regulation or expenditure.’.
Amendment 36, in clause 22, page 13, line 13, at end insert—
‘(1A) Demand reduction regulations must make provision about demand reduction payments.’.
Amendment 37, page 13, line 21, at end insert—
‘(2A) Subject to any further provision made under this Chapter, a demand reduction payment is an instrument by virtue of which—
(a) an energy user is paid for reducing the demand for energy or investing in a technology which can be shown to reduce the demand for energy either permanently or for a specified period;
(b) all electricity suppliers may be required to make payments (“demand reduction payments”) to or for the benefit of these users.’.
Amendment 38, page 13, line 23, at end insert—
‘(3A) Provision included in regulations of demand reduction payments for the purposes of subsection (2A) may make provision about the meaning of “energy user”.’.
Amendment 39, page 13, line 41, at end insert—
‘(4A) Provision included in regulations of demand reduction payments by virtue of subsection (2A) may include provision about—
(a) the terms of a demand reduction payment;
(b) the circumstances in which, and the process by which, a demand reduction payment may or must be made;
(c) the persons who may be paid;
(d) the circumstances in which and technologies for which payments may be made;
(e) the number and size of payments;
(f) the means by which demand reduction payments are to be calculated;
(g) a person or body who is to administer the settlement of demand reduction payments (“a settlement body”);
(h) the enforcement of the terms relating to demand reduction payments;
(i) the resolution of disputes relating to a demand reduction payment payment;
(j) the circumstances in which a demand reduction payment may be terminated or reclaimed or varied;
(k) the circumstances in which a demand reduction payment may be assigned or traded;
(l) the means for monitoring and verifying the energy reduction for which demand reduction payments are made.’.
Amendment 40, page 14, line 6, at end insert—
‘(5A) Provision falling within subsection (4A) includes provision—
(a) conferring on the national system operator the function of issuing demand reduction payments;
(b) about any conditions that must be satisfied by or in relation to a person before that person may receive a demand reduction payment;
(c) about any matters in relation to which a person must satisfy the national system operator before the person receives a demand reduction payment.’.
Amendment 41, page 14, line 9, at end insert—
‘(6A) Provision made by virtue of this section may include provision requiring a person to consent to the inspection of plant or premises, either before or after that person receives a demand reduction payment.
(6B) Subject to the provisions in section 24, the Secretary of State must within six months of the making of demand reduction regulations establish a fund drawn from capacity payments for the purpose of issuing demand reduction payments.’.
Government amendment 135.
Gregory Barker
We now turn to the topics of electricity demand reduction and route to market. I shall speak in favour of the new clauses and amendments in the name of the Secretary of State and I thank hon. Members for tabling the other new clauses and amendments in this group, prompting debate on this vital set of issues.
I will start by setting out the Government’s approach to electricity demand reduction. Making good my pledge in Committee, the Government have brought forward new clauses 11 and 12 and amendments 100 and 135, which, for the very first time in our energy history, would allow energy saving projects to compete for new investment on an equal footing with power stations. It has long been recognised that in many cases it is cheaper, as well as greener, to save electricity rather than generate it. However, the coalition’s radical legislative proposals for large-scale energy efficiency are a double win—a win not only for the green agenda, but for hard-pressed consumers worried about rising bills.
The fact is that successive Governments have failed to grab the opportunity to get units of saved power, or “negawatts” as they are sometimes called, to compete with traditional megawatts. Thanks to this reforming Energy Bill, the era of negawatts has finally arrived. We already have a number of important policies aimed at driving greater efficiency, but these measures mean that we can go further. As I said to the Financial Times way back in September 2010, we need to create new markets for electricity efficiency projects to bring in the scale of new investment needed that is commensurate with the challenges and opportunities.
Following our consultation on options to promote electricity demand reduction, we concluded that a new financial incentive would be the most effective way of delivering a step change in the efficient use of electricity. The most cost-effective way to achieve this, without cannibalising the budget for renewables, is to include demand reduction in our proposed capacity market, and that is achieved through Government amendment 100. Hon. Members and their constituents can now be reassured that while we have a massive, multi-billion pound, low-carbon infrastructure programme ahead of us, we will not be building expensive new energy plants unnecessarily where cheaper alternatives for energy efficiency are available.
Delivering EDR through the capacity market will let us achieve three key objectives: targeting reductions at more expensive peak times; securing value for money because it will set megawatts against potentially cheaper “negawatts”; and bringing permanent demand reduction projects into line with shorter-term demand-side response measures to enable more effective, joined-up delivery of energy efficiency across the board. The approach of delivering EDR through a capacity market is proven—it is already being done in the United States of America—but our approach is more visionary and will certainly be much more ambitious. Government new clause 12 will provide a spending power to enable our approach to be tested via a large pilot, or pilots, to better understand, among other things, the complexity of the issue and the scale of the potential. Government new clause 11 and Government amendment 135 allow the Secretary of State to appoint and make payments to an alternative delivery body to National Grid for the capacity market. If it is decided that National Grid is not best placed to carry out the EDR elements of the scheme, then we will have this legislation ready.
I am most grateful to the hon. Members for Southampton, Test (Dr Whitehead) and for Brighton, Pavilion (Caroline Lucas) for their thoughtful amendments, which were tabled prior to the Government’s amendments. I am also grateful for their consistent and constructive, as well as passionate, advocacy of this agenda. I particularly thank the hon. Member for Southampton Test. He and I have long been proponents of action in this area, but his expertise in and technical understanding of these issues are, I think, universally acknowledged to be unsurpassed in this House. I hope that the House will join me in recognising his contribution. Amendments 34 to 41 seek to include demand reduction in a capacity market. In the light of the amendments that I have tabled, which achieve that objective, I hope that hon. Members will feel comfortable withdrawing their amendments.
New clause 2, with its amendment, would require the Secretary of State to publish a strategy to reduce a stated amount of electricity demand by 2020 and 2030 while requiring no use of the price mechanism to reduce demand. I welcome the principle behind the proposal. However, let me point out that as well as establishing the first ever Energy Efficiency Deployment Office within my Department, the Government have published a number of seminal documents, including the first ever comprehensive Government energy efficiency strategy, which will be updated again later this year. We have also published DECC’s energy and emissions projections and, most recently, the Government response to our EDR consultation. These documents provide a comprehensive view of the Government’s approach, which was encapsulated at the launch by the Prime Minister of the first ever energy efficiency mission earlier this year.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I want to push the Minister on that point. Will any of those documents address the opportunities for smart metering to play a role in the rapid reduction in energy use in domestic and other premises? Many of us believe that smart metering is the answer for a dramatic reduction. Moreover, the Minister will know that I have tabled new clause 16, which would require the installation of carbon monoxide detectors alongside smart meters. That would help reduce the 40 deaths and 4,000 admissions to A and E a year caused by carbon monoxide poisoning.
Gregory Barker
Indeed. I hope we will have time to discuss the hon. Gentleman’s amendment on carbon monoxide detectors, of which he is an unprecedented and unparalleled champion in this House. I am glad to say that his point about smart meters is fully recognised in the strategy documents. He is absolutely right to say that smart meters will give far better access, as well as information, to consumers to participate in this new, two-way energy efficiency economy and open up all sorts of opportunities. They will also be an essential part of our vision to build an electricity, internet and smart group in the UK. On the development of a demand reduction measure, we are clear that a financial incentive is the most appropriate way forward and that it should lie in a capacity market.
Climate change is, according to the vast majority of scientific experts, with whom I emphatically agree, a clear and present danger to our planet and our economy. Our measures reflect yet another example of the coalition’s determination to rise to this challenge and allow the UK to play an ambitious part in combating the worst excesses of dangerous, man-made climate change.
Hon. Members can be reassured that the measure is not an additional green burden on consumer bills. It will make energy policy greener and potentially cheaper—a genuine win-win situation. I therefore hope that hon. Members will withdraw new clause 2 and its amendment (a).
I now turn to the Opposition amendments—I am grateful to them for tabling them—on the important issues of distributed energy and route to market for independent renewable generators. Independent renewable generators are key to the Government’s ambitions for not just green energy, but the energy market as a whole—not just in helping us achieve secure, affordable and low-carbon electricity, but in delivering a more plural, competitive and dynamic market.
The Government agreed during the Bill’s Committee stage to consider an amendment similar to amendment 1, the intention of which is to increase the maximum generating capacity of feed-in tariff eligibility from 5 MW to 10 MW. I have a great deal of sympathy with the proposal. It continues to be under active consideration and I am committed to finding a workable solution. However, it is a complex issue, because not everyone agrees on this way forward. The Solar Trade Association has stated, for example, that it would be against such an increase. My Department is considering whether it could be delivered without destabilising the existing FITs and renewables obligation schemes or creating perverse incentives.
Andy Sawford (Corby) (Lab/Co-op)
Will the Minister define more clearly what he means by “active consideration”? Those Members who support amendment 1 will be encouraged by his remarks, but they will also fear that the impetus of amendment 1 might be lost if it is not agreed to tonight.
Gregory Barker
I deem the raising of the FITs threshold to be very attractive and am personally driving the issue in the Department. However, when looking at the proposal in further detail, I have been made aware of potentially perverse consequences and impacts on the renewables obligation. I was slightly surprised by the views of the STA but have taken them on board. We need to unpack a number of issues and I currently have officials working on the matter. I am hopeful that we can find a way through or partially through, and land at an outcome that, while it might not be the one the hon. Gentleman exactly wants, he would find satisfactory. I cannot say any more on that because I have not come to the House in a position to make a commitment or statement, but I hope he takes from the tenor of my response that we are not just considering the matter; work is being done in the Department and we hope to bring further measures to the House. I reassure him that we hope to respond as the Bill continues its passage through Parliament—most likely, in the other place.
Amendment 46 seeks to increase the specified maximum capacity of the FITs scheme to 50 MW. I have considerable sympathy with that objective, which recognises the effective nature of the reformed FITs, but such an uplift could produce unintended consequences on FITs, budgets, the levy control framework and renewables obligation certificates. As things stand, we do not consider that such a large change offers the best value for money, because it could have significant impacts on the functioning of the renewables obligation and push up costs for energy bill payers.
Amendment 42 seeks to define distributed generation. I applaud the motive of the amendment, but having carefully considered it, and as sympathetic as I am to its intention, on balance, we do not consider it necessary. The reformed and highly successful FITs scheme already ensures that communities can generate their own electricity from a range of technologies. I am proud that, under the coalition, hundreds of thousands of people have decided to do so, and are now successfully self-generating electricity to meet some or all of their needs—in some cases, they export to the grid—on both community and domestic scales. Public buildings, particularly schools, are a popular choice.
Amendment 43 aims to implement a new support mechanism for generation attached to our electricity distribution network. I have led reforms on the FITs scheme to ensure that it remains not only open, but successful and increasingly ambitious, while delivering value for money. We are now closing in on half a million installations. Virtually all the installations supported by the FITs scheme are distributed generators. We therefore do not see the need for a new mechanism, which could confuse consumers and potential generators. The reformed FITs system is doing a good job and is increasingly popular.
Amendments 44 and 45 aim to require distribution companies to supply distributed generation—even if that does sound like a slight oxymoron. UK distribution network operators already ensure that electricity generated by distributed generation is transmitted to where it is needed, if it is not consumed locally. While I am sympathetic to the intent behind the amendments, I do not see that they are strictly necessary.
I am grateful to the hon. Member for Southampton, Test for tabling amendment 47, which seeks to address an important issue: the independent renewable generators’ route to market. The amendment would create a duty on the Secretary of State to establish a green power auction market for renewable generation—GPAM, as it is often known. I hope the hon. Gentleman knows, and the House appreciates, that I am sympathetic to the intention behind the amendment. Bringing on board new, dynamic and disruptive new entrants is a key aim of the Bill. I am personally committed to breaking the grip of the big six and making our vision of a far more decentralised energy economy a reality.
John Robertson
The Minister will appreciate that this is music to my ears, but how does he expect to be able to do that—by bringing new people into the market or by trying to help smaller companies to develop?
Gregory Barker
Both, I hope. Certainly, it would not be satisfactory if the big six became the big seven or eight. Ultimately, we need the big 60,000. We want to extend the enthusiasm for micro-generation and community generation, and scale it up so that small-scale generators, who currently cater only for their own needs, begin to have the ambition to export electricity in their areas and create community interest companies. We also want entrepreneurial companies. The sector is ripe and rich for entrepreneurs. We want to see new disruptive players coming into the market and using new technologies or offering better services. There are already some good independents in existence. I have met a number of them and they are seeing their customer numbers grow considerably. As things stand, however, there is still a long way between them and the big six.
Bob Stewart (Beckenham) (Con)
Does the Minister mean that a district such as Bromley in my constituency might have its own green power generation system, which would be designed specifically for that area and would provide for all its needs? Is that what we are going for?
Gregory Barker
That is a real possibility. A number of local authorities already have that ambition and are using a range of technologies. Woking is using gas-fired CHP, but renewable fuels such as woodchip can be used, too. Such processes can generate substantial amounts of reliable electricity, and if they are carried out locally, the heat generated can also be used constructively, with cheap affordable heat being sent into social housing and public buildings, or to private residents. This model is already starting to take shape in pioneer local authorities. The city of Nottingham has exciting plans for district heating networks on a scale not seen in this country for generations.
The irony is that this is not new technology. District heating by local generation companies is where this energy was born; it began on a distributed model. It was only in recent years that the Labour party nationalised the industry and created one big monopoly, and it was under the previous Labour Government that the number of energy companies shrank from 14 to six.
We are striving to put the “local” back into local energy provision, but we are not prescribing any one model; it could be rolled out in lots of different ways—there are exciting projects around the country, and we want to see a lot more of that—but it must be done in a way that, first and foremost, works for local people and is affordable. I return, however, to a point I made on the previous amendments: we have within our reach the opportunities to do that in a way that is not only green, but affordable—and sometimes even cheaper than the alternative.
Katy Clark
I am extremely interested in what the Minister is saying. Is not one of the problems, however, that we do not have the infrastructure to do what he suggests? A few weeks ago, the Isle of Arran, in my constituency, was without electricity for a week. Even if it had its own generators, the substation is one-way traffic, and I understand that it would need a smart grid to use any energy created on the island. How will the Energy Bill help that island?
Gregory Barker
We are already embarked on a massive programme of grid renewal. The National Grid has published at length its proposals for how to roll it out. Obviously it cannot be done overnight, but we have made it clear that we are looking to build, with billions of pounds of investment, overwhelmingly from the private sector, a completely new grid that will do exactly as the hon. Lady says and permit a new relationship—a two-way, more equal one—between the consumer and the producer, and allow for the adoption of these diffuse new technologies. She is right that while the old grid is still there, there are certain barriers, but wherever possible and wherever it makes economic sense, we are keen to work with local communities and district network operators to help them overcome those barriers and to see what can be done within a reasonable economic cost. She is right that there are still barriers, but my Department is working proactively to try to overcome them.
I hope that the House appreciates that I am sympathetic to the intention behind amendment 47 to create a green power auction market—bringing onboard these disruptive new entrants is the key aim. GPAM is a means to an end, however, rather than an end itself. No one solution is inherently good; what matters is what it can deliver, and there are several ways of delivering the agreed outcome while navigating in slightly different directions. Our concerns stem from the fact that GPAM is effectively a fixed feed-in tariff, as it provides the generator with a guaranteed price for all the power it generates. As a result, the generator would have no incentive to manage its imbalance risks, as these would be taken away from it, which could work out more expensively for the consumer.
Although I welcome and fully appreciate the aims of GPAM, we have to be careful, despite having all the right motives, not to create an expensive, long-term solution to what might turn out to be a short-term problem. CFDs will undoubtedly improve conditions, which I know have been challenging, in the market for power purchase agreements, enabling independent renewables projects to get off the ground much more easily. They should not only help the smaller independents out there now and doing a great job, but attract—I hope—new entrepreneurs into the market. Although I have issues with GPAM, therefore, I want to make it clear to the House that I am not complacent and am not saying that we have all the answers.
I fully recognise that there is an issue at stake, which the GPAM amendment endeavours to address, but the route-to-market issue is complex. It is such a technical issue that we perhaps cannot do justice to it in a debate on the Floor of the House. However, it is an issue that my officials, with all their skill and expertise, are absolutely committed to tackling. At a political level, I am personally committed to finding a solution to it, albeit a solution that must be workable and not lead to greater costs for consumers.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
The Minister raised a number of issues. I wish to focus on his points about demand reduction and community energy, before handing over to other hon. Members who wish to speak on this group of amendments.
Let me begin by saying how wonderful it is finally to hear what the Government propose to do about reducing demand for electricity. When the Bill was first published in May last year, many industry experts rightly observed that there was a gaping hole where the answer to that question should have been. We spent many hours in Committee and on Second Reading discussing and debating how we generate energy, but not how we could use less of it in the first place. A fortnight ago, the Government produced new clauses 11 and 12. I will come to their merits in a moment, but first I must tell the Minister that these proposals should have been brought forward much sooner. I know that the right hon. Gentleman agrees with me about that, because when we debated the need for demand-side measures in Committee at the end of January, he said:
“There can be no proper discussion and scrutiny of electricity strategy or really forward-looking ambitious Government energy policy without the inclusion of our plans for demand reduction.”––[Official Report, Energy Public Bill Committee, 29 January 2013; c. 345.]
He was absolutely right. It was challenging, however, that the Government did not have any demand reduction plans in place at that time.
Martin Horwood
Has the hon. Lady not noticed the launch of the green deal, which is possibly the most significant energy efficiency initiative in British history? I have to say that, for those of us who remember the chaotic system of energy efficiency grants that existed under the last Government, it compares extremely favourably with them. I think she is being a little ungracious about this Government’s energy demand reduction strategy.
Luciana Berger
We wanted properly to scrutinise the Government’s plans in Committee. We have only recently had the opportunity to do so, and we have just heard what the Minister said. I remind the hon. Gentleman that pay-as-you-save efficiency scheme pilots were started under the last Government. We are waiting to see exactly how the green deal is doing. We await the Government’s figures, and we expect to see them at the end of June.
During pre-legislative scrutiny, the Energy and Climate Change Committee concluded that Ministers were failing to give enough priority to demand-side measures. As I have said, we still had no firm proposals on Second Reading. In Committee, the Minister would not confirm whether the Government would definitely seek to include demand reduction amendments in the Bill once his consultation had concluded. Now, at long last, we have the results. We received them two weeks before Third Reading and a year to the day since the Bill was first published.
The Minister has now said that he is minded to pilot measures to reduce electricity demand through the capacity market, and we welcome that step. However, the Government’s own response to their consultation accepted that that course of action still presented a number of uncertainties. A number of questions remain unanswered. I am sorry that the Minister will not have an opportunity to answer them, but I would be happy to give way if he would like to intervene on me. It would be helpful to know, for example, exactly how the pilots will work and by how much the proposals will reduce electricity demand. Those are currently complete unknowns.
The Government’s forecasts from before the new clauses were published showed that current policies would reduce electricity demand by 59 TWh in 2018 and by 68 TWh in 2030. That energy saving would be dwarfed, however, by an additional 92 TWh of untapped potential saving that could be achieved by 2030, according to analysis by McKinsey. That could be the equivalent of a 25% reduction in total electricity demand, representing a colossal saving. It is unfortunate that the Minister could not share with us the Government’s estimate of by how much the capacity market could reduce electricity demand over the same period.
Many people have also raised serious concerns about how effective the capacity markets can be in rewarding energy saving. In the United States, for example, a similar policy in Massachusetts resulted in energy efficiency projects receiving just 3% of total capacity payments. Despite complex design, 70% of capacity payments went to existing fossil fuel generation instead. Were the Government aware of that scheme? If so, what lessons have they learned from it?
The way in which new clauses 11 and 12 are drafted provides the mechanism for pilots to happen, but they do not offer any further detail. I listened carefully to the Minister’s remarks, but there were a lot of gaps. The proposals do not specify what measures will be piloted, or whether more than one measure will be trialled. We are no clearer, following his remarks, as to when the Government are planning to launch the pilot or when they expect the first capacity auction to take place.
Gregory Barker
We are expecting to run a capacity market trial in 2014. We expect the pilot for energy demand reduction to be run then as well. We will be providing further details.
Luciana Berger
I thank the Minister for his intervention, and hope he will lay before the House the rules governing those auctions so that we can properly scrutinise them. We hope they will be forthcoming.
I was disappointed by the Minister’s response to the amendment proposed by my hon. Friend the Member for Southampton, Test (Dr Whitehead). I echo the Minister’s words that my hon. Friend, as the whole House will know, has long-standing expertise and considerable experience in this area. His amendment 35 would require the Secretary of State to establish
“a scheme…to make payments for the purpose of rewarding…energy saving measures”
and to do so “within one year” of this Bill becoming law. That would introduce clear, simple payments for households and businesses, and it could start immediately, with no wait for a capacity crunch to trigger an auction. I understand that the majority of respondents to the Government’s consultation favoured a premium payment option along those very lines, but we did not hear from the Minister the rationale behind the Government’s decision to reject that option and favour instead incentivising demand reduction through the capacity market.
Let me touch briefly on amendment 47, also proposed by my hon. Friend the Member for Southampton, Test, which would establish a green power auction market, or GPAM. This would combat a significant issue. The UK needs to invest £75 billion in new renewable generation by 2020. Analysis of DECC’s own figures has shown that the Government are currently relying on 35% to 50% of this investment being delivered by independent renewable energy generators, or the “disruptive new entrants”, as the Minister referred to them on a number of occasions. Their current route to market is dependent on long-term purchase power agreements with the big six. A green power auction market of the kind my hon. Friend proposes could open up the market to new suppliers, increase competition and potentially deliver a cash saving to consumers of £2 billion. Although I welcome the Minister’s saying that he wants to address this sector and that a real issue is at stake, I sincerely hope that a viable solution, which he said would be forthcoming, is in place in time for the allocation of the first CFDs in 2014.
I conclude by dealing with our amendment 1 on community energy, which stands in my name and those of my right hon. Friend the Member for Don Valley (Caroline Flint) and my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex). Speaking as a Labour and Co-operative Member, I am very proud to speak to this amendment. It would appear that the Minister and I agree that community energy schemes deliver enormous benefits to our country. They bring diversity, resilience and security to the energy market. They boost our economy by attracting new sources of investment, and they help to tackle fuel poverty through a strategy for generating and saving energy that is owned by local people.
I recently saw that first hand when I visited Brixton Energy, an award-winning solar project run by Repowering South London. It is the UK’s first inner-city co-operatively-owned energy project, and I urge hon. Members to pay it a visit if they have not already had the pleasure. As well as offsetting 28 tonnes of carbon every year, the project is providing invaluable work experience opportunities for young people. There are many other fantastic community energy projects throughout the country: Westmill wind farm co-operative in Oxfordshire, Neilston community wind farm near Glasgow and the Lochcarnan community wind farm—the list goes on. There is a risk, however, that as drafted the Bill could stop these types of larger community schemes ever happening again. That is why we need to amend it today.
The Secretary of State has said that he
“wants nothing less than a community energy revolution”,
but those words ring rather hollow when we examine how this Bill fails to address how community energy schemes can compete with large-scale commercial generation. The issues have been well summarised by Cornwall Energy, when it said that the high degree of technical knowledge needed to participate in the system is a barrier for many smaller generators, and that the proposed CFD system does not compensate smaller generators for the lower market prices they receive for their power. With the end of the renewables obligation, the Bill provides no incentive for suppliers to purchase renewable electricity from independent generators.
Katy Clark
I congratulate my hon. Friend on the way in which she is putting forward her case. She will be aware that many of the successful community generation projects—those that really laid down the way forward—were in Scotland, and particularly in the island communities where there is a very strong sense of community and a wish to have a sustainable future. If we look around Europe, we find that this is also very common—in Germany, Scandinavia and Greece, for example. Does my hon. Friend agree that we have fallen behind in this area?
Luciana Berger
We need to see urgent action in this regard. Other countries are forging ahead with numerous locally generated schemes, and we ought to have as many, if not more.
Caroline Lucas
I certainly support the amendment, but I wonder why the hon. Lady limited the threshold to 10 MW. The Energy and Climate Change Committee talked of 50 MW, and many non-governmental organisations have talked of more than 10. I think it would be useful to convey the idea that “community” means more than just “small”.
Luciana Berger
If the hon. Lady looks at the amendment, she will see that it refers to
“not less than 10 megawatts.”
It does not limit the threshold to that level.
I listened carefully to what the Minister said about his commitment to “active consideration”, a phrase that he used many times. He used the same phrase when we discussed a similar amendment in Committee four months ago. If the Government really want to deliver the community energy revolution to which the Secretary of State has referred, actions must speak louder than words. The hon. Member for Edinburgh West (Mike Crockart) expressed his support for community energy, and I hope that he will join us in the Lobby to support amendment 1. Unfortunately, the hon. Member for Beckenham (Bob Stewart) is no longer in the Chamber, but I noted his aspirations for community-generated energy in Bromley, and I hope that he, too, will join us in the Lobby.
I urge Ministers to support our amendment, and I urge the House to divide on the issue if they will not do so.
David T. C. Davies
I am normally a loyal Back Bencher. I sometimes skip merrily through the Division Lobbies behind my leaders, and at other times go through those Lobbies with a slightly heavier heart. I am afraid that this will be one of the occasions on which I back the Government, but do so with a certain amount of trepidation.
I listened with great interest to the Minister’s explanation of how he would reduce electricity demand, but one of the most important questions that can be asked from these Benches is not “how”, but “why”. Why is it necessary to do this in the first place? The Minister gave us a bit of an explanation by referring to climate change, which he described as a clear and present danger. Of course it is a clear and present danger. No one whom I know of has denied the reality of climate change, and I have certainly never done so. The point is that the climate has always been changing. That has been a clear and present danger for the last 4.5 billion years. The new clause, and indeed the entire Bill, was tabled on the basis that the 0.8° rise that we have seen over the last 300 years is somehow more of a danger than any of the other rises and falls that we have seen over the last 4.5 billion years.
I did a bit of scribbling as I was sitting here and listening with interest, and I worked something out. I have seen many graphs in the documents backing up these claims, and if we had a graph that showed every 100 years as 1 cm, in order to show how long the earth had been in existence, the graph would have to be 280 miles long, which is twice the length of the High Speed 2 rail route. If we really did have a graph that was that long and we were going to look at just 3 cm of it, would it be wise to put forward such far-reaching amendments and Bills based on changes that are not that far out of the ordinary over the course of the 280 miles that my imaginary graph stretches?
Gregory Barker
Despite my hon. Friend’s eloquence, I fear that he and I are never going to agree on his interpretation of the science of climate change or on the need to act. I will just say to him about energy efficiency measures, however, that even if there were not man-made climate change, there would still be a compelling reason to act, because saving money is always a good thing to do, and that is what these energy efficiency measures will deliver for hard-pressed consumers.
David T. C. Davies
The Minister is right. He did not, however, mention the other reason that is sometimes put forward—that we are about to run out of carbon-based fuels and uranium—and as he did not mention it, I will not knock that argument back. Instead, let us address the point he made: that this may well lead in the longer term to cheaper energy.
I have no objection at all to many of the things the Government are doing: the smart meters, the decentralisation—which the Minister talked about—and the insulation, which was not mentioned, but which I assume is part of the same package. I get slightly more nervous when I hear him talking about negawatts rather than megawatts, however, as that suggests people will be paid for not producing things.
We have already had that situation in farming, where people have been paid not to produce food. I sometimes wonder whether the Minister—or, indeed, the hon. Member for Brighton, Pavilion (Caroline Lucas)—would like to pay me for not making speeches. I see much nodding of heads. I ask myself, however, whether this proposal is economically sensible. I am a keen student of economics, and it is my understanding that there are only two ways to reduce demand for anything. One way is to ration the goods that are in demand, and to some extent the Government are making provision for that, as they know there is a danger that we could run out of electricity over the next 10 to 15 years. My understanding is that there have been discussions as to how, if that were to happen, demand might be rationed in respect of certain high users of energy. The second way to reduce demand for any commodity is to increase prices.
Whatever the Minister says about negawatts and insulation and smart meters, the reality is that prices are going up partly in response to the policies this Government are putting forward. We have a system that now subsidises production of electricity that would otherwise be economic, in order to make it harder for people to get hold of it.
At the moment, the clear and present danger to all of us is the economy. The one thing the coalition was elected to do was sort the economy out.
Dan Byles
I am still digesting what was said about the supply and demand curve. It is, of course, also possible to shift the demand curve, and my understanding is that, in terms of energy efficiency, we are seeking not to reduce demand down the curve through pricing or rationing, but to shift the entire demand curve so there is less need in the first place.
David T. C. Davies
Well, I am going to have to think about that one for a few minutes before coming back with a substantive response. I will say, however, that it is not wise to talk about reducing people’s access to electricity at a time when we want to be saying to businesses across the world, “Come to the United Kingdom and invest.” We are not going to be able to compete with anyone on the basis of labour costs; indeed, we do not want to compete on that basis. We do, however, want to be able to say to business, “If you come here, you’re going to get a large and reliable source of electricity.”
Gregory Barker
Let us just be clear that we are not talking about reducing businesses’ access to electricity; we are talking about seeing energy as part of being in a resource-efficient, competitive, global economy, where businesses that can use less energy in creating their products or delivering their services will have a competitive edge.
David T. C. Davies
I fear that within 20 or 30 years those who are now talking about the temperature changes we are seeing will find that they are not that out of the ordinary in the context of the past 8,000 years or 4.5 billion years. We may look back and ask, “Why did we suddenly decide to make it more expensive to generate electricity in this country? Why did we suddenly decide to decarbonise at a time when other nations, such as China and other places in south-east Asia, were doing quite the opposite?” We may look back from a point in the future when not only the GDPs of those countries, but their GDPs per head are much larger. Carbon emissions will not have stopped, temperatures will not have risen that much and those rises that do take place will be as much to do with things such as the Pacific decade, oscillation and the natural changes that go on in the Earth, and we will wonder whether we were right to go down this path.
David T. C. Davies
I will not give way any further. I have made my point. I will be supporting the Government, as much as anything else because I look at some of the people who are not supporting them and I realise that being in coalition, even being in the same party as people whom one can respect and admire but not always agree with, is all about a bit of give as well as a bit of take. So I will support the Government tonight, but I hope that the Minister will think about what we say and consider whether these policies might need amending in the light of further evidence about the relevance of temperature rises in the future.
Dr Whitehead
I think the hon. Member for Monmouth (David T. C. Davies) will be going home tonight and throwing all the contents of his fridge out, because he knows that he can go down to the shop to buy some more food tomorrow. Perhaps he might think about the wider externalities of saving energy and saving demand, because, among other things, having a good demand-side reduction policy means that we do not have to produce the new capacity that otherwise we might have in stream to meet our energy demand, as we would be using energy across the board much more efficiently. Whether or not one believes—he plainly does not—that anthropogenic climate change is a real and pressing issue, using our energy far more efficiently and making sure that those possibly unfundable, difficult-to-organise increases in capacity can be averted by doing so is a prize in its own right. That is the case whether or not one thinks this is intimately bound up with climate change, and I wish to dwell briefly on that precise point.
The Minister showered me with kind words, so he would not expect me to say anything unkind in return. It would be churlish of me, and I was not intending to do so. [Interruption.] There is no “but”. Instead of advocating, at great length, the amendment that I was pursuing on demand-side reduction, I wish to see whether we can unpack a little of some of the consequences of the Government proposals that have now been introduced. I warmly welcome those, and I know that the Minister had quite a hard time getting them to the table in their current form. Therefore, I very much welcome both the effort that has gone into introducing these provisions and their content. Essentially, the amendments would produce, through the right mechanism of capacity payments rather than contracts for difference, a serious method of addressing the question of demand-side reduction over a long period, but I would place a little question mark against that demand-side reduction capacity or anti-capacity being auctioned through the general capacity auction system. As my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) has mentioned, we know from experience elsewhere in the world that demand-side auction participants tend to be squeezed out of wider auctions on capacity when they participate.
Gregory Barker
I have been following the argument closely. Although we are not in a position to announce details today, our thinking is very much in tune with that of the hon. Gentleman, and we recognise the issues that he raises. We expect the capacity market to run in 2014, but we expect that, separate from that, piloted projects for energy demand reduction will be funded to help scale up the market, and in future we expect ring-fenced auctions, at least for a transitional period, for specific demand response and demand reduction projects.
Dr Whitehead
I thank the Minister for that clarification. I am encouraged by the thinking that clearly is beginning to be done on what these things might look like. I wish the Minister luck when the Treasury realises that the pilots taking place on capacity payments may have more substance to them than the Treasury might think. I should not have said that, in case someone there reads the Hansard transcript of this debate! I am encouraged by the Minister’s response.
The other matter that I want to raise relates to amendment 47, which calls for the establishment of a green power auction market arrangement in wholesale and retail sales of energy. I want to spend a moment establishing why something like GPAM is so important. My amendment attempts to resolve, or at least to go some way to resolving, a very serious issue: the drying-up of opportunities for independent generators to establish reliable markets for their low-carbon generation once the renewables obligation comes to an end in the spring of 2017.
Hitherto, those independent generators have been able to secure power purchase agreements on the back of renewables obligation certificates, and to use those agreements effectively to bank their investments, so that they have the sort of market certainty that enables those investments to be funded because it is known that there is a stream of sale coming forward that will ensure that the investment is made and works well, as far as both the independent generator and the bank are concerned. With the arrival of contracts for difference, that simply will not be the case. Indeed, power purchase agreements for those people still undertaking RO arrangements before the end of the renewables obligation have already dwindled to virtually zero. In fact, only one company, as far as I know, is presently providing power purchase agreements.
Most independent generators, whether we are talking about onshore, offshore, or other forms of low-carbon generation, are already thinking, when it comes to their investment decisions, about CFDs rather than ROs, simply because of the time period over which those investments have to be considered. They cannot go back to the bank and say, “Can we have that investment on the basis of what we can demonstrate to you, in the absence of other financial credit lines, is a known supply line for our energy product?”
The outcome could be quite perverse, with regard to what the Bill’s intentions have always been. It was always the intention, with the contracts for difference, to try to bring a lot of new, different investment into the energy market, as well as independent generators of different sizes. It was also the intention to ensure that the vertical integration seen in recent years did not become the enemy of investment, or of small, independent operators and others trying to get into the market, but rather became its friend, as other entrants came into the market alongside larger generators.
If the outcome is that as a result of the Bill we further consolidate the vertical integration of the market rather than the opposite, that will be a perverse outcome relative to everything that the Bill was supposed to bring about. If we can get a mechanism similar to the green power auction market—if it quacks a bit like GPAM and walks a bit like GPAM—I would be happy with that. We need some mechanism that can ensure that independent generators are not captured by the very large companies and that they do not have to enter into such disadvantageous contracts that they will fail to make a living from the energy that they are trying to put into the market in the future.
Mr Sheerman
As I understand it, small generators in some parts of the world, particularly America, are increasingly looking at crowd funding in order to get started. That is a new opportunity for finance, which some people are calling a new form of democratic capitalism that empowers local communities.
Dr Whitehead
My hon. Friend is right. Indeed, there are companies in the UK, such as Ecotricity, which have not exactly involved themselves in crowd funding, but have engaged in bond arrangements for the development of their low-carbon power. Even if such a source of funding is available, if the deal for the subsequent sale of the energy is so disadvantaged by a contract for purchase that shaves off the reference price or makes arrangements that are extremely disadvantageous to the ability of that company to sell its energy into the market—while at the same time those potential purchasing companies take advantage of their vertical integration by providing routes to market for their own generation at different costs and under different arrangements—the future market will be very distorted indeed.
I welcome the Minister’s saying that the issue is being actively considered, that he understands the problem at the heart of the GPAM proposals, and that he is actively in dialogue with industry on possible routes to solutions. I look forward to proposals in another place to address the issues. It is essential that they are addressed before the Bill completes its passage, so that the market that we produce as a result of CFDs is fair for those participating in it and produces the varied and pluralistic market that we want for electricity generation, particularly low-carbon energy generation, in the future.
Caroline Lucas
I want to say a few words about the amendments in my name, starting with new clause 2, which deals with the strategy for electricity demand reduction. The clause sets a clear ambition for 2020 and 2030, using figures published by DECC, alongside the electricity demand reduction consultation, and requires the Secretary of State to have policies that get us there.
I was a little disappointed that, in response to the amendments that I have tabled, the Minister on many occasions indicated warm sympathy but not action to achieve the aims. Willing the ends but not the means creates a nice warm fuzzy feeling, but does not change the menu of targets and strategies before us. That particularly matters when it comes to electricity demand reduction, because there is so much scope for doing so much more in this area. No matter how sympathetic we feel to that aim, however, unless the legislation is in place, we do not have the clarity, certainty or confidence that action will be taken. We have seen all too often how, in the absence of firm targets and strategies, Governments fail to put in place adequate polices or resources to achieve things. My worry is that in many respects elements of the Bill are more like a wish list than a strategy.
Caroline Lucas
I refer the hon. Gentleman to a report by McKinsey on DECC’s website, which sets out exactly how we can reduce electricity demand by 36% by 2030. That potential figure was properly referenced and much work has gone into identifying it—indeed, others have used a higher figure—but we are not even getting anywhere close to that at the moment.
The focus of my new clause is to say that that is not enough, given that those on both sides of the House, with the possible exception of the hon. Member for Monmouth (David T. C. Davies), appear to agree that the most effective way to tackle fuel poverty and high energy bills is to reduce the overall amount of energy we need to keep our homes warm and to cut energy waste. The new clause is straightforward and complementary to amendments 39 to 41 on demand reduction regulations.
While energy demand reduction is a bit of a no-brainer, the Government’s current approach is failing. The latest shocking example is last week’s news that the number of homes installing cavity wall insulation has crashed by 97% since the introduction of the green deal. Quite incredulously, I can say that a DECC spokesman is quoted as saying that the early signs are encouraging. I wonder what Ministers would consider discouraging and alarming if a drop from almost 40,000 cavity wall insulations in April last year to 1,138 this April is not precisely that.
For the sake of existing energy efficiency businesses that are struggling in Brighton, Pavilion and elsewhere, for the sake of families paying huge bills due to poorly insulated homes, and for the sake of the huge number of jobs that could be created in every constituency across the UK, we urgently need a serious approach with suitable ambition, a plan to get there, and that is exactly what new clause 2 would achieve.
John Robertson
I tried to get cavity wall insulation and I was told that because of my brickwork I could not have it, although I would have thought that my type of house was ideal for it. Is it not that the rules are now being adhered to by companies, whereas before they were putting it in and a lot of houses were suffering from damp as a result?
Caroline Lucas
Obviously, I am not deeply acquainted with the brickwork of the hon. Gentleman home, but I find it slightly surprising that the justification that he advanced would be responsible for such a dramatic reduction. I cannot believe that quite so many cavity wall insulations, down from 40,000 last year to just over 1,000 this year, could be as a result of its having been done badly in the past. There might have been an element of that, but there are some real concerns about the take-up of the green deal and the way in which it replaced some pretty good schemes instead of building on them.
New clause 3 is about community rights to priority access to local power generation and local grid ownership.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. New clause 3 comes in the next group.
Caroline Lucas
I apologise, I thought they were all wrapped up together in one happy family.
I am delighted that amendments 42 to 46 are supported by the hon. Member for Hove (Mike Weatherley), so in recognition of that I will call them the amendments from Brighton and Hove. They are basically about decentralised energy, which was another area where the Minister said that he appreciated the direction but did not feel that action was necessary. I quote from “Power to the People—the Decentralised Energy Revolution”, a document from the Prime Minister himself:
“In other countries low carbon energy sources have led a process of decentralisation—in the Netherlands, for instance, in little more than a decade, combined heat and power (CHP) became the single largest supplier of the country’s energy needs.
I want to see a similar revolution happen in Britain.”
I want that too, but I do not see it happening unless we put the means in place. It is a real shame that that vision has gone the same way as the abandoned huskies—once hugged, now hated. Distributed generation is about producing and using energy locally.
Gregory Barker
We have a long way to go, but since the coalition came to power, hundreds of thousands of homes and businesses have started generating their own electricity—and that is only the beginning.
Caroline Lucas
I am delighted to hear the Minister say that. All I want to do is build on that wonderful beginning and make it go even faster with even more ambition. That is why I so hoped that he would support the amendments that go in exactly that direction. Seriously, I know that the Minister is deeply committed to the issue; I simply think that we could get there faster and with a bit more ambition by having a clearer strategy and focus.
Decentralised energy is not even formally defined in Government policy. I would have thought that it would be simpler if it were; that is one of the issues that my amendments would address. Of course, decentralised energy is already used in hospitals, schools, small towns and so forth, but its untapped potential remains vast. I cannot help thinking that if Ministers spent a fraction of the time promoting decentralised renewables that they spend promoting the nuclear industry, we might have a different kind of energy system today.
The amendments would create a new feed-in tariff scheme for distributed generation, with a maximum capacity limit of 50 MW. I am glad that I now understand the amendment tabled by the hon. Member for Liverpool, Wavertree (Luciana Berger); I am delighted that the 10 MW was a bottom line rather than a top limit. The 50 MW was the level recommended by the Energy and Climate Change Committee and we should be more ambitious than the 5 MW that the Government currently foresee or the 10 MW ballpark figure from the official Opposition.
Finally, the amendments would require distribution network licence holders to play their part in facilitating decentralised energy. It is worth pointing out that a distributed generation feed-in tariff would involve no additional cost for consumers or the Treasury; it would simply provide an effective way for small generators to invest in electricity generation and participate in the market.
Again, the new clause is complementary to amendment 47 on a green power auction market and to Opposition amendment 1. I hope that the amendments can be taken together as a positive contribution to moving to decentralised energy in a swifter fashion.
Andy Sawford
It is a pleasure to follow the hon. Member for Brighton, Pavilion (Caroline Lucas) and my hon. Friend the Member for Southampton, Test (Dr Whitehead).
A year ago, my hon. Friend and I, along with my right hon. Friend the Member for Don Valley (Caroline Flint), wrote in a paper called “The Power Book” about the potential for community energy. We argued that as the new energy industrial revolution unfolds in this country, future technologies, new sources of renewables and low-carbon energy have huge scope to challenge the existing market, help reshape the relationships between people and power providers and create new agents of delivery. I pay particular tribute to my hon. Friend the Member for Southampton, Test, who has been pioneering such work for some years—for example, he has championed the district heating project in Southampton as an MP and former local council leader.
I also want to mention such projects as the Baywind energy co-op in the Lake District, Watchfield in south Oxfordshire and Brixton Energy. There are increasing numbers of inner-city providers of community energy.
However, we have to be honest. The scale of such projects in this country is small compared with other countries. We should look to America, for example. Some 42 million American citizens, the equivalent of two thirds of the population of this country, are members of energy co-ops. The German example is even more impressive. Since 1990, German citizens have had a legal right to be producers and suppliers of electricity to their grid system. The big step change came a decade ago when their Government introduced a system of preferential feed-in tariffs. That transformed an energy sector that once had only four major suppliers into one that now has over 2 million contributors. It also created 400,000 jobs and has lowered prices, year on year, over the past five years.
Across the UK, local councils are rising to the challenge of transforming the energy sector. I have followed community energy projects around the country and I have profiled projects in Stoke, Stevenage, Kirklees and Sheffield. I am particularly pleased to welcome Electric Corby, which was launched in my constituency on Friday. It is a not-for-profit community interest company formed with the support of the borough council to establish the UK’s leading practical community-scale test centre for future low-carbon living and transportation and to redistribute the benefits of its labours to the Corby community. As the Minister will know, Electric Corby is funded via DECC’s Cheaper Energy Together switching competition. We welcome that support, but it is very much a local initiative.
Jim Shannon
The hon. Gentleman is energetically outlining the case for the community initiatives that are taking place across the whole United Kingdom. Does he feel that these community initiatives will enable people to see that this is not being foisted on them because they have an opportunity to control the situation? That is why they are good, and they should have had a great start.
Andy Sawford
I absolutely agree with the hon. Gentleman, who hits on the key point that this is about shifting the power in energy supply to give ordinary people a chance to say to the big six, “If you won’t give us a fair deal we can do this for ourselves in our local communities.”
Electric Corby is partly about enabling people to switch their energy provider, but it is wider and more ambitious than that. For example, it will involve an electric vehicle charging point infrastructure. I recently welcomed the shadow Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Streatham (Mr Umunna), to Corby to see those electric charging points and other innovations in my constituency. In Priors Hall, a major development of 5,000 new homes has just begun, and there is smart metering and electric charging points across the whole development.
We are trying to lead in Corby, but I am concerned about the potential impact of this Bill. I particularly support amendment 1, which has been ably championed by my hon. Friend the shadow Minister. In Committee, the Government indicated that they were supportive of the amendment. That was welcome, and it was on that basis that it was withdrawn at that stage. We have heard some very warm words from the Minister today. He and I have previously spoken in the Chamber about energy policy. I know that he tries to listen and respond to good debate, as in Committee, but it is disappointing to find that he cannot offer something more substantive to the House in respect of amendment 1.
The purpose of amendment 1 is to raise the feed-in tariff threshold to benefit co-operative and community energy suppliers. Currently, the feed-in tariff is for projects of under 5 MW. That means that renewable developments of over 5 MW have to participate in the new contracts for difference. I share the concern that contracts for difference will raise the barriers to entry for the community energy projects that Members in all parts of the House have said that they support. The need for a higher degree of technical knowledge is one such barrier to entry. The contracts will mean that smaller generators will receive lower market prices for their power. With the end of the renewables obligation, there will no longer be an incentive for suppliers to purchase renewable energy from independent suppliers.
For those reasons, the feed-in tariff threshold should be raised to above 5 MW. I agree with the hon. Member for Brighton, Pavilion that we should be ambitious and raise it further, but the amendment would allow us to raise it to apply to schemes of above 10 MW. That would give smaller renewables projects a clear and certain route to market and enable us to promote the community-owned renewables sector.
Nigel Adams (Selby and Ainsty) (Con)
Will the hon. Gentleman explain why the Solar Trade Association is opposed to raising the threshold to 10 MW?
Andy Sawford
I have to inform the hon. Gentleman that had I been a representative of the Solar Trade Association I would have declared an interest. I am sure that he and I can both read the briefings it supplies to this House. Indeed, he may wish to enlighten us about this; I will gladly give way if he wishes to do so.
I was surprised to hear about that. I have a letter from 15 organisations involved in the championing of community energy provision in this country, including the Centre for Sustainable Energy, the Forum for the Future, the National Trust, the Low Carbon Communities Network, the Communities Carbon Action Alliance, the Co-operative, Co-operatives UK and, indeed, the Co-operative party, which I represent in Parliament. They all believe that the Energy Bill’s measures will make it much more difficult to achieve the step change in the provision of community energy that I hope we all want to see.
Gregory Barker
This has been a very thoughtful debate. I am sorry that I have not been able to deliver everything that Members have sought, but I think there has been an unusual degree of consensus on the direction we are taking, our objectives and the Bill’s overall intent.
It is clear that we need to do more on independent generators. I listened carefully to the hon. Member for Southampton, Test (Dr Whitehead) and I assure him that we are working to come up with an acceptable proposition to address the real concerns of independents about the barriers to markets they face, but in a proportionate way that makes sense. The green power auction market, as has been said, is a means to an end, not an end in itself, and we believe that we can navigate our way to that destination in an effective, proportionate way.
On community energy, a great deal unites us throughout the House. I have been campaigning for it since 2006, so I am sympathetic to calls to raise the feed-in tariff threshold. Now that we have reformed the feed-in tariff scheme—in the teeth of the Opposition—we can consider going further. The hon. Member for Corby (Andy Sawford) should not infer from the fact that we are unable to support amendment 1 that we are in any way set against the proposal. We are actively looking at it, but we need to think about the impact on all of the technologies. As my hon. Friend the Member for Selby and Ainsty (Nigel Adams) said, the Solar Trade Association is opposed to it. I was slightly surprised by that, but if we consider just how big a 5 MW solar array is, perhaps we will conclude that it makes sense. It is the size, I think, of several football pitches, so 5 MW of solar is a significant installation. Concerns about the potential siting of inappropriate large-scale solar on greenfield prime agricultural land before our sustainability criteria are in place, rather than on where we want to see it, namely rooftops, brownfield sites, industrial sites, factories, warehouses and supermarket car parks—basically, integrated into the built environment wherever possible and certainly on non-agricultural land—could present certain problems. We need to think through the unintended consequences that raising the tariff threshold would have. On the surface it seems extremely desirable, but it will have further impacts.
We also need to think about how that relates to the renewables obligation. In the short term—for the next few years, at least—the alternative for community schemes will not be contracts for difference, but renewables obligation certificates, which are now, finally, after a series of improvements, being used and understood by the small player. However, we believe that in the longer term, even for the smaller-scale independent, contracts for difference will be a significant improvement. We are determined to make them work for small-scale and community players.
I hope Opposition Members take on board that the coalition has an unprecedented commitment to rolling out a distributed model of generation, and that the Government are taking steps to put that vision into reality. I am sure the hon. Member for Brighton, Pavilion (Caroline Lucas) is right that there is always more to do. We have not finished yet—it will take two or probably three terms of government to achieve our ambition—but in the Bill we have the foundations of a new, exciting, dynamic, secure, low-cost and low-carbon energy economy. I urge colleagues to support the Government’s amendments and urge Opposition Members not to press their amendments to a Division.
Question put and agreed to.
New clause 11 accordingly read a Second time, and added to the Bill.
New Clause 12
Pilot scheme for electricity demand reduction
‘There may be paid out of money provided by Parliament expenditure incurred by the Secretary of State in connection with arrangements made—
(a) for the purpose of reducing demand for electricity, and
(b) wholly or partly for the purpose of determining provision to be included in electricity capacity regulations.’.—(Gregory Barker.)
Brought up, read the First and Second time, and added to the Bill.
Clause 10
Direction to offer contract
Amendment proposed: 1, page 8, line 8, at end insert—
‘( ) Section 41(4)(a) of the Energy Act 2008 (“specified maximum capacity”) is amended as follows: “Specified maximum capacity” means the capacity specified by the Secretary of State by order, which must not be less than 10 megawatts.’.—(Luciana Berger.)
Question put, That the amendment be made.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
I beg to move, That the Bill be now read the Third time.
Let me begin by thanking those from all parts of this House and outside who have helped to strengthen this crucial Bill and bring it to this point. I thank the Energy and Climate Change Committee and its Chair, my hon. Friend the Member for South Suffolk (Mr Yeo), and the informal scrutiny group in the other place for conducting invaluable pre-legislative scrutiny of the draft Bill. I also thank the individuals who gave oral evidence to the Committee, as well as the organisations that took the time to provide expert written evidence and recommendations.
In particular—I think you will agree with me, Mr Speaker—I could not allow the Bill to leave this place without thanking my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes) for skilfully guiding the Bill through Committee. I am told that at one point in Committee he managed to compare himself to Henry VIII and Indiana Jones in the same breath—I am not sure whether he has told his wife. I for one salute his unique style in promoting renewables.
I also want to thank the Ministers of State, Department of Energy and Climate Change for their hard work. It would be remiss of me if I did not also mention my hon. Friend the Member for Wealden (Charles Hendry).
On the Opposition Benches, the hon. Members for Rutherglen and Hamilton West (Tom Greatrex) and for Liverpool, Wavertree (Luciana Berger) have been skilful and insightful. I am grateful that they have applied the principles of constructive opposition to the Bill’s scrutiny rather than the principles of destructive opportunism, which are all too often applied in politics generally—by people of all political colours—but which are all too often not in the national interest. Let me take this opportunity to remind the House why the passage of the Bill is so important and so firmly in the national interest.
Caroline Lucas
I am grateful to the Secretary of State for thanking everyone for contributing to making the Bill stronger, but I wonder how he thinks that it has been made stronger, given that, as far as I can see, not a single Opposition amendment has been accepted, either in Committee or on Report.
Mr Davey
The hon. Lady might not have noticed that the Government have responded to a lot of the debates and tabled a lot of amendments on everything from electricity demand reduction to decarbonisation. I will come to those amendments shortly.
Electricity market reform, which is at the centre of the Energy Bill, is the result of four imperatives: the need to power the country; the need to protect the planet; the need to insulate consumers from rising energy bills; and the need to get the economy moving. With demand for electricity set to increase, and around a fifth of our power plants set to close, we will need to attract £110 billion of new investment in electricity and grid infrastructure in this decade alone to ensure that we have enough reliable capacity to meet demand. The Energy Bill will do that.
The Climate Change Act 2008 commits the United Kingdom to an 80% reduction in greenhouse gas emissions by 2050, so we need specifically to encourage investment in low-carbon energy generation: renewables, carbon capture and storage, and nuclear. The Energy Bill will do that. With global demand driving wholesale prices higher, and with that in turn driving domestic energy bills higher, we need to create a more diverse and competitive energy market to help to cushion consumers from volatile fossil fuel prices. We also need to ensure that they are getting the best deal from suppliers. The Energy Bill will do that.
By facing up to the need to invest in low-carbon energy infrastructure, we will support economic recovery too. The trebling of support under the levy control framework will mean £7.6 billion a year by 2020 to support low-carbon technologies, including infrastructure projects that are ready to go now, supporting jobs, supporting communities and providing prosperity. Projects worth over £8 billion are already in the planning pipeline. Electricity market reform could support as many as 250,000 jobs in the energy sector. The Energy Bill will support green growth. That is why I am pleased that the Bill, as strengthened in Committee and on Report, benefits from a general level of cross-party support in the House.
I want to reflect on some of the ways in which the Bill has been further strengthened in this House. Let me start by dealing with the decarbonisation target head on. No party in this House—not the Liberal Democrats, not the Conservatives, not Labour, not the nationalists, not even the Greens—had a commitment in its 2010 manifesto to set a 2030 decarbonisation target during this Parliament. Nor has any other country yet set a power sector decarbonisation target for 2030.
I can understand the argument that an early decarbonisation target could provide extra certainty for large, long-term projects in the UK power sector, particularly in the supply chain. However, there is also logic in the consistency of setting the decarbonisation target for 2030 at the same time as the fifth carbon budget, which is scheduled for 2016—still 14 years ahead of the target date. By comparison, the 2020 renewables target was set in 2008, just 12 years from its target date.
If anyone still doubts my commitment, or that of this Government, to decarbonisation, they should consider the decision that we have just made on the UK’s position for the EU’s 2030 greenhouse gas target. In the context of winning an ambitious global climate change treaty, we will be arguing for a 50% reduction target in the EU. That is the most ambitious position of any member state, and I am proud that this Government are leading the way on climate change action.
Let me turn to other areas of the Bill—first, to contracts for difference. Long-term electricity price stability will be provided through CFDs and will be a key part of the new low-carbon electricity market. As such, the Commons Committee quite rightly looked at the nature of the CFD counterparty body and made a number of recommendations. In response, the Government have clarified the Bill’s drafting to make the policy intention more explicit.
Mr Weir
I am listening closely to the Secretary of State, but does he not share my slight concern about the CFDs that, as the Bill presumably leaves this House tonight to go to the other place, we still do not know basic details such as the strike price? Although that information has been promised on several occasions, we are now told that the delivery document may be published next month. We do not seem to be getting any nearer to getting this information.
Mr Davey
We always said we would publish the document in July 2013, and we are on track to publish it in July 2013.
Accompanying the CFDs, the capacity market will ensure that sufficient reliable generating capacity is available to meet electricity demand as it increases over the next decade, but we are also looking at reining in demand. We have added measures on electricity demand reduction that for the first time can allow energy-saving projects to be able to compete with power stations for new investment—negawatts. Delivering through the capacity market can incentivise permanent reductions in demand at times when electricity is most expensive, allowing for a more direct trade-off between generation capacity and demand reduction. This is a radical approach that has been shown to work in international examples such as in forward capacity markets in the United States, and it is a major advance for the UK.
We acknowledge that many consumers are “feeling the pinch”, and we remain committed to doing everything we can to help. Let me be clear, however, that the main reason for rising energy bills is rising wholesale gas prices, which make up around half a typical household dual fuel bill. These prices are set on global markets and changes are driven by global events. This Bill paves the way for increased UK production of energy, which will help to reduce price rises from global markets.
As well as providing a more stable pricing environment and helping consumers to reduce their electricity demand, we introduced in Committee new provisions on domestic tariffs to ensure that all households will be able to get the best deal for their gas and electricity. These provisions will ensure that energy companies provide consumers with clear information about their tariffs and put them on the cheapest tariff that meets their preferences. These provisions will also ensure that there are fewer and simpler tariffs so that it is easier for consumers to shop around for the best deals across the market. Last year, Ofgem estimated that there were approximately 900 open tariffs. Under these proposals, each supplier will be allowed to offer a customer a maximum of four core tariffs for each fuel and meter type. We want to see a competitive retail market, where suppliers have to work hard to retain their existing customers and attract new customers.
These measures complement the new consumer redress measures already in the Bill, which ensure fairer outcomes for consumers by giving a new enforcement power to Ofgem. This power will enable Ofgem to require energy companies that have breached regulatory requirements directly to compensate consumers where they might otherwise not have done so. This is another step forward for energy consumers.
We have listened to the concerns raised throughout the passage of the Bill. Opposition Members have raised questions about transparency and accountability, and we have responded by amending the Bill further to ensure that it aligns with the Government’s principles in this area.
We remain committed to encouraging a more diverse and competitive energy market, and there are a number of related areas within the Bill that we will hope to consider further in the other place. As indicated in Committee, we will continue actively to consider raising the threshold for the small-scale feed-in tariff scheme from 5 MW to 10 MW, and the Government hope to respond to this issue in the other place. We are taking backstop powers in the Bill to enable the Government to intervene in the generating market, if needed, to improve liquidity and competition.
I am grateful to the House for taking the time to scrutinise and contribute to this Bill. The wide cross-party consensus we have achieved sends a strong signal to investors in the UK and investors globally. The UK is the place in the world to invest in low-carbon energy. We now have the opportunity to deliver a lasting framework for investment in the country’s energy infrastructure: delivering green jobs and green growth, securing a low-carbon energy future, and ensuring that consumers get a fair deal. I commend the Bill to the House.
Caroline Flint
Let me begin by paying tribute to my hon. Friends the Member for Rutherglen and Hamilton West (Tom Greatrex) and for Liverpool, Wavertree (Luciana Berger), who, with just a fraction of the resources and staffing available to Ministers, have done a first-rate job in debating the Bill. They have not only scrutinised it, but improved it.
I also pay tribute to my hon. Friends the Members for Sunderland Central (Julie Elliott) and for Hyndburn (Graham Jones), who have provided invaluable support for those on the Opposition Front Bench; to my hon. Friends the Members for Southampton, Test (Dr Whitehead), for Brent North (Barry Gardiner), for Wansbeck (Ian Lavery) and for Ynys Môn (Albert Owen), who served on the Bill Committee; and to my hon. Friend the Member for Glasgow North West (John Robertson). They have all brought a great deal of expertise and experience to bear.
I thank the Ministers and officers in the Department. There have been some personnel changes on both fronts, but we have managed to get through the process. I thank the Secretary of State for the briefings that he facilitated with officials in his Department, as well as the Clerks and the ever-helpful staff in the Library, who have advised us on some of the finer points of detail and parliamentary procedure.
I made it clear on Second Reading that we would not oppose purely for opposition’s sake, and on that basis we have sought to find areas of agreement with the Government when that has been possible. We have supported the provisions to establish an office for nuclear regulation, as well as those relating to the Government pipeline and storage system and to offshore transmission systems.
As the Secretary of State has just said, Ministers have accepted some of our amendments, including those concerning the transparency of investment contracts and the structure of the counterparty under contracts for difference, and I welcome that. We have not yet managed to persuade them to accept amendments relating to other issues, such as carbon capture and storage, support for community energy and access to the market for independent renewable generators, but we have noted their commitment to considering our proposals, and we hope that colleagues in the other place will return to them.
The Secretary of State referred to the redress framework. We are disappointed by the rejection of amendments that would have ensured that consumers were compensated pound for pound and that compensation was paid in respect of any breach of the rules that came to light, because that has left a massive loophole. The best way of protecting consumers is not to provide a redress framework—much though we need that—but to prevent companies from ripping people off in the first place, and I am afraid that on that count the Bill falls badly short.
The Prime Minister told the House 12 times that he would force the energy companies, by law, to put everyone on the cheapest tariff, but, although the Bill consists of nearly 200 pages, not a single one of them contains legislation to put every customer on the cheapest tariff automatically, which is what the Prime Minister promised. Ultimately, unless the energy market is genuinely reformed through the wholesale side—as we have proposed—there will be nothing to prevent the energy companies from raising all their tariffs in any event.
Whenever I meet investors, the single most important thing that they tell me they want is certainty. They should gain confidence from our support for the substance of the Bill. When it comes to contracts for difference, there are clearly many important details still to be worked out, but, in principle, if CFDs are executed correctly, they should provide investors with long-term certainty, and we will therefore support them.
There are also many important details still to be worked out in regard to the capacity market, but in principle we believe that it could work, and have supported it. We also support the principle of an emissions performance standard, and welcome the commitment to reviewing it in five years’ time. However, as my hon. Friend the Member for Brent North said yesterday, we are concerned about the particular standard that the Government have chosen to adopt, and we hope that the other place will scrutinise it carefully.
That is some of the good news, but I must also be candid about where the Bill fails, and how we would seek to remedy that after the next election if it is not rectified in the other place. The Government’s stated purpose was to reform the electricity market to deliver secure, clean and affordable electricity, but there are no two ways about it: the Bill will fall short of its stated purpose unless it puts Britain’s electricity system on a pathway to decarbonisation, and unless it genuinely reforms the electricity market to make it more transparent, liquid and competitive.
We have had a full debate on decarbonisation this afternoon. I pay tribute to the hon. Member for South Suffolk (Mr Yeo) for tabling his amendment, and for the work of his Select Committee. I also pay tribute to the work of my right hon. Friend the Member for Doncaster North (Edward Miliband), who was the first leader of a main political party to commit himself to decarbonisation. The Bill does not contain a decarbonisation target because the Liberal Democrats, with a few honourable exceptions, did not have the courage to vote for it.
It is clear that the Conservative party has now set its face against decarbonisation. Its choice is to lock Britain into a high-cost, high-carbon electricity supply for decades to come, but there is still a clear majority in this House in support of decarbonisation. The Labour party supports it, and the Scottish National party, Plaid Cymru and the Green party all support it, too, and I thank colleagues from other parties who joined us in the Lobby this afternoon. With a Government majority of just 23, there is no doubt that if the Liberal Democrats—who claim to support this, who have a party policy on it, and who have a Secretary of State who says he supports it—had voted for it, this Bill would have put us on the pathway to decarbonisation.
Let us be clear about what this Bill does and does not do. It does not set a decarbonisation target; it only says the Secretary of State may set one if they so choose. The Government could have supported just changing “may” to “must”, to give an indication of more certainty in this area.
It has been said many times this afternoon that none of the major parties had support for this target in their manifestos. However, the Committee on Climate Change has only made that recommendation since the general election, and we said we would support its recommendations. We must be able to do that. Things change from one general election to another, and we must listen to that advice. The truth is that even if the Secretary of State decides to set a target, 2016 is the earliest date at which it could be set, but it could be set at any later date—2026, 2036, 2046—or not at all. There is also no specification about what the target should be, so the Secretary of State could issue an order for a target that is totally inconsistent with decarbonisation, or do nothing at all, and still have fulfilled the requirements of the Bill. We would put that right.
Caroline Flint
I enjoy many train rides from Yorkshire with the hon. Gentleman, but I will not give way to him as he has not been present all day for this debate. If he gets a chance, he can make his comments later.
Her Majesty’s Opposition are absolutely committed to decarbonisation of the power sector. The reasons for that are simple. First, the biggest driver of soaring energy bills is rising global gas prices. Cleaning up our power supply and investing in energy efficiency would lead to lower, not higher, bills. Secondly, the best way of improving our energy security is to take advantage of the natural energy sources in our own country. This is the windiest country in Europe, and when it comes to marine energy, Britain really can rule the waves, but businesses will only invest, and bring jobs and growth to this country if they see that the Government back decarbonisation. As my hon. Friend the Member for Wansbeck said, we should give confidence to those who wish to invest in carbon capture and storage and put us at the forefront of clean coal. Thirdly, if we cannot decarbonise the power sector, we will not be able to reduce the country’s carbon footprint, and if we cannot do that, we will face a future of chaotic weather, rising sea levels, flooded homes, failing harvests and drought.
If the other place is not able to rectify the omission of a decarbonisation target from this Bill, we will do so in government. Our determination to clean up the power supply is matched by our commitment to reform the energy market and to make it work in the public interest. So, on decarbonisation and fairer bills for consumers, we regret what is missing from this Bill, and make a commitment to put it right.
Investors should draw confidence, however, from the fact that there is broad cross-party support for many of the provisions in the Bill, and, on our part, there is the political will to deliver a lasting framework to bring forward investment in low-carbon electricity generation. On that basis, we will not oppose the Bill on Third Reading, but it is to be regretted that a dirty deal with the Liberal Democrats has once again blocked the path to clean energy and all the benefits it could bring.
Mr Brian Binley (Northampton South) (Con)
I am grateful for this chance to speak on Third Reading, and I will be brief.
In bringing forward these measures, the Government have identified a genuine problem whose consequences could be severe—indeed, the lights could go out. Security of supply is imperilled through the decommissioning of resources. The shortage of available public funds requires that the private sector delivers, but uncertainties and market conditions have created a blockage. Above all, we need to keep a close eye on the price of energy, and this Bill has proved to be an important opportunity to do that.
I do not doubt that some of the measures in the Bill will contribute positively, but the bigger issue remains an abiding concern that the cost to British industry will be disproportionately high, and the price we pay will be of even greater magnitude. I have seen nothing to indicate that the Government have taken seriously the question of the costs from this Bill to our economy and our businesses compared with our major competitor economies.
We need to ask whether the true cost of the zealous attachment of Liberal Democrats to renewable energy solutions, endorsed by and, sadly, imposed from Europe, should be pursued seemingly at any price. A recent report by Civitas articulated many of those concerns, saying that the relentless drive to renewable energy is stifling innovation in the sector and costing a fortune, with the risk of reversing the long-term trend of improved living standards. It estimates that the cost to households of the renewable energy fixation will be about £600 each year by 2020, with the economy bearing a cost of about £200 billion—more than £16 billion each year, which exceeds 1% of our GDP. That is an enormous cost and a massive burden. The report also demonstrates that we risk bearing a quarter of the target of the EU renewables directive, as we plan to create the largest single increase in renewables to achieve compliance. The renewables obligation already costs us around £2 billion each year, a figure predicted to rise to £8 billion to meet these targets. Taking that money out of the economy will impede our growth, reduce prosperity and cost jobs.
Although decarbonisation is a worthy ambition and a desirable destination over time, fuelling subsidies for expensive and inefficient renewable energy technologies risks taking us further from, not closer to, achieving that ambition. The cost we pay in promoting the renewable energy sector could prove damaging to the development of our own innovative response to the challenge of decarbonisation. It could harm our prospects for rapid and sustained economic recovery, and it could drive enterprise away from this country. If decarbonisation is our goal, we should be far more prepared to encourage innovation in a range of different technologies and systems. This is not about whether we have a decarbonisation target in the Bill; it is about approaching the issue without the prejudice and the dogmas that have characterised the Secretary of State’s rhetoric and approach in office—he has been only moderately less rabid than his predecessor.
The energy challenge that we face is acute. The previous Government failed to do what was necessary. The time to act has almost passed; it is possible that even these measures may be too late to avert a harmful crisis. However, my overwhelming anxiety is that this Bill is not the answer to the energy questions we face, not least because of the impact that will confront businesses in this country. I wonder whether, in approving these measures, we are supporting good politics within the coalition but at a far greater cost to our economy than we can either sustain or afford.
Mr Weir
I said at the outset that SNP Members did not oppose this Bill on Second Reading and we will not oppose it tonight. We recognise the need for electricity market reform and support much in the Bill. I understand the Minister’s point—I understand that contracts for difference could well be a good way forward—but I remain concerned about the lack of much of the detail, and I say that for two reasons.
In Committee, I raised the issue of the closure of the renewables obligation system in 2017 and whether that could have an impact on investment in the meantime. Many companies that are considering investment are still unsure about how the CFD system will work and are concerned about the changeover. More thought should have been given to how the interim period could be dealt with, perhaps by extending the RO system. Regrettably, the Minister was not prepared to accept that.
The other point about CFDs is that we still do not know what is being negotiated between the Government and EDF in respect of Hinkley. Whether or not I am anti-nuclear, that is important, because whatever those details are they will inevitably become the template for future CFDs in the nuclear industry. If the price is set too high and the contract is too long, that could have huge implications for the public purse in the future. None of those details are available. We are told that they will be available in July, presumably when the House is in recess, but we have no opportunity to look at these things, and that is a shame.
Late in the proceedings, the Government introduced amendments on consumers, including the Prime Minister’s promise to put them on the lowest tariffs. I do not think they were strong enough and I tabled amendments on Report that, unfortunately, were not reached because of the time available.
I also tabled an amendment to deal with a question that I have often raised about winter fuel allowances and the need to provide small-scale practical help for consumers, but it fell into the last group tonight.
Jim Shannon
On that subject, statistics show that in the past year 24,000 people died from cold-related causes. That was due in a big way to the inability of the system to address people’s needs early. Does the hon. Gentleman feel that it is not too late for the Government to take that on board and that ensuring the early payment of such money at a time when oil is cheap would be a good way forward?
Mr Weir
That is an excellent way forward. The Minister of State, Department of Energy and Climate Change, the right hon. Member for Sevenoaks (Michael Fallon), has convened a round table on oil-fired heating. The first meeting was held in May and I welcomed that. It was a useful meeting and might perhaps be a way of dealing with that industry, but we need small-scale help as electricity market reform is not the only way of dealing with energy markets. Small-scale things can be done that make a real difference and the Government must grasp some of those issues, rather than simply considering massive measures such as this Bill.
There is a decarbonisation target. We fully support it; I spoke in the debate on it and gave the reasons why. If Governments north and south of the border want a true, green, sustainable manufacturing base, a decarbonisation target will give companies the assurance that will allow them to invest for the future. It will enable them to be sure that they have a market as they push towards it. It could also provide a huge amount of sustainable, highly skilled jobs. As I pointed out earlier, growth in the Scottish economy has come largely from the energy industry and such development could be a huge boost for the future, so it is unfortunate that we do not have that target.
There are defects in the Bill, but there are some good things. We will not oppose the Bill on Third Reading, but I hope that when it gets to the other place the Government will reconsider some of the issues.
Dan Byles
It is a pleasure finally to be speaking on Third Reading. I am a member of the Select Committee on Energy and Climate Change, which has carried out inquiries into energy market reform and pre-legislative scrutiny of the Bill, and I also sat on the Public Bill Committee, so it has been a labour of love getting here.
Although I support the Bill, I admit that I have some concerns. I am concerned about the level of complexity we are starting to pile on to our energy sector. Perhaps that is inevitable, as this is a highly complex policy area, but I sometimes feel that unintended consequences lead to another sticking plaster being put on, leading to more unintended consequences, so that a highly complex system evolves. I do not necessarily blame the DECC team for that, as this is a difficult and complex area, but I hope that as the Secretary of State introduces the secondary legislation he will bear in mind the need to try to minimise the complexity as much as possible, in keeping with the aims of the Bill.
The energy sector still faces huge challenges. As for the oft-quoted figure of £110 billion a year of infrastructure investment, I have seen a lot of estimates that put the figure much higher. Some people grossly underestimate the scale of change required in our energy sector, particularly in the argument about decarbonisation. The year 2030 is just 17 years away and at 10 minutes to 6 today, in real time, 40% of our electricity was being provided by gas and 35% was being provided by coal. That means that 75% of our electricity was being provided by gas and coal. Gas heats 83% of our homes. We will have a substantial slice of gas on the system for a long time, so we need to get on and start exploratory drilling for shale gas once again, so that we can ensure that the gas is provided from a domestic source. The Institute of Directors has told us that shale gas production could provide up to 74,000 jobs, both directly and indirectly, and up to a third of peak demand—and that is just the central scenario. We need to search for shale gas, and to accept that gas will be on the system for a long time to come.
We also need steadily to increase investment in renewables; I entirely accept that. Sometimes people throw at me that I am anti-decarbonisation—we have heard that from some Opposition Members—but I am not. We need to move to a low-carbon future, not through a rash, uncosted 2030 decarbonisation target set this year, but through the nuts and bolts of the contract for difference and the levy control framework, as the CBI has said.
Andrew Percy
One of the reasons why I was not here earlier is that colleagues from our region and I were with a Treasury Minister, trying to ensure that when the money for renewables comes on stream, British companies benefit from it. Does my hon. Friend not agree that once we get the Bill out of the way, the biggest challenge is to ensure that it is British companies, such as Tata Steel in Scunthorpe, who benefit from the additional money going into renewables?
Dan Byles
I entirely agree. This needs to be seen in a much wider context than energy; this is about jobs and investment, including inward investment.
Gas will be on the system for a long time; we need to bring forward new gas generation. We need to increase renewables on the system, and we desperately need new nuclear. There is hardly a credible scenario for a decarbonised future that does not involve new nuclear on the system. We need to incentivise generation capacity in all three. The Bill is long overdue, and I will support it this evening, because it will achieve that aim.
Caroline Lucas
I am sorry to sound a negative note, but to my mind the Bill falls well short of what is needed. Ministers have had many opportunities to improve the legislation for the sake of our economy and those struggling with high energy bills, in order to create many thousands more jobs and, crucially, to demonstrate that we politicians are up to the job of tackling the climate crisis with the urgency and ambition required.
The Bill could have demonstrated that politicians understand the risks of locking the UK into high-cost, high-carbon gas generation for decades to come; that we listen to and act on scientific advice on the urgency of action needed to avoid irreversible climate change. The Bill simply does not go far enough. There are some positive aspects: for example, I welcome the emissions performance standard, but it is too weak, and it opens the door to a new dash for gas. As a result, we have not seen the last of people turning their backs on the politicians who listen to the fossil fuel lobby rather than climate scientists, and people instead taking action themselves in the name of what they see, and the science says, needs to be done—people such as the brave, peaceful protesters who occupied EDF’s West Burton power station last year.
If we are to avoid catastrophic climate change and the worst impacts here and elsewhere, in terms of water shortages, flooding, food price rises and drought, it is clear that around 80% of existing fossil fuel reserves need to stay in the ground. How can we hope to leave that unburnable carbon in the ground if we cannot even agree a decarbonisation target for 2030? I am not looking forward to writing yet again to hundreds of my constituents to tell them that the decarbonisation target has been rejected, against all common sense. Frankly, I find it almost unbelievable that so many Liberal Democrats voted against their own policy.
It is a scandal that the Bill does not have more ambition when it comes to renewable energy and energy efficiency. Instead, it will facilitate vast subsidies to new nuclear power stations that we do not need. There are plenty of records of how we can reach our climate change and decarbonisation targets without new nuclear. New nuclear, with vast public subsidies to support it and no real public or parliamentary scrutiny, is at the centre of the Bill. Crucially, that is diverting investment away from faster, less costly, more jobs-rich and more secure means of meeting electricity needs, including through harnessing the UK’s huge renewable energy resource. The enormous potential of energy efficiency and demand reduction is also overlooked, with weak amendments from the Government convincing nobody. That ignores the widespread consensus that these are the cheapest, quickest, and most effective ways to protect householders from high energy bills, and to cut emissions.
Perhaps most of all, I am disappointed that the Bill simply fails to have a vision of a different energy future. It simply entrenches the big six energy companies and their death-grip on the UK’s energy system and on the many households in Brighton, Pavilion and elsewhere who are struggling to pay ever higher energy bills. It reinforces the centralised electricity system, in which people are just passive consumers, constantly ripped off, whether or not they switch from npower to EDF to E.ON, because essentially they are all the same. Contrast that with a place such as Germany, where only 13% of the country’s 60 GW of renewable energy is owned by big energy companies. The rest is owned by households, communities, development trusts and farmers. Fully 50% is generated by community-based projects.
The Bill could have supported projects such as the Brighton Energy Coop, releasing a new wave of co-operative and community energy projects where people are so much more than passive consumers—they are active producers of energy. It could and should have set us on a path to a radically different, more democratic energy future by giving smaller independent generators and community and co-operative energy schemes fair access to the market, where people own and generate their power on a serious scale and benefit from lower energy prices as a result. I am very sorry that the Bill has not taken those opportunities.
Glyn Davies (Montgomeryshire) (Con)
I have sat in the Chamber for more than six hours today and heard many interesting speeches. It has been an extremely good debate. The Bill is important in many respects. It is the responsibility of Government to ensure energy availability, to ensure that energy is supplied at a reasonable cost and to pay proper heed to the need for decarbonisation of the energy generation market.
Whether or not one believes that man’s activities contribute to climate change—I do not think they make that much difference—it is perfectly reasonable to want to pursue a decarbonisation approach as a sort of insurance policy, so people will tend to agree with the general approach that the Government are taking. There is also general support for renewable energy projects, and there is a huge number of good projects all over the country. I opened a biomass project in my constituency run by a firm called Egnisco. If anybody is going to the National Eisteddfod in Wales in 2015, I recommend that they go to the farm buildings at Mathrafal where they will see a superb scheme. The buildings have been converted into factories and have all been heated by a biomass project that is taking timber from local woodlands. It is a wonderful project.
To me it is important that the Government pursue their objectives in a reasonable way. There are two aspects that cause me and my constituents great concern. One is the attitude that we have to the local population. We have heard the words about localism in the Chamber, but I am more interested in the deeds. I can say that, right across the constituency, my constituents do not believe that the Government care one jot for what they think and what they say.
Today the largest public inquiry into wind farms opened in Welshpool in my constituency. It is likely to take 12 months. The small rural local council has had to set aside £2.8 million just to defend the decisions that it took. This will have a huge effect on local services, but nobody cares. When the Welsh Government were asked whether there was any way they could help the council, they said, “You knew what was going to happen and you turned down the application.” I thought that was utterly disgraceful. They were going to suspend their entire planning responsibilities to avoid the costs of defending their decisions.
Another aspect is the public inquiry itself. My constituents are deeply concerned that it is dealing just with the wind farms and not with the transmission line to them. It is like dealing with houses without any roads to them. Some £50,000 was spent trying to change the position, and people believe that DECC had some involvement with the inspector when the council’s decision was rejected. I do not know whether that is true, but I wrote to the Minister several weeks ago and have not yet had a reply to reassure my constituents that that did not take place.
A further issue that causes me shock and disgust is how National Grid has behaved and is behaving. The project that I am talking about is a very big project in my constituency; it involves about 500 wind turbines and 100 miles of cable, 50 km of which are on 150-foot high steel pillars. Not surprisingly, landowners have not been keen to co-operate with National Grid and to allow it on their land, so National Grid sent in the heavies. In truth, it has sent in thugs.
I have an e-mail here that I only wish I could read out, because it is so shocking. It comes from Councillor Gwilym Thomas, a recently elected county councillor for an area affected. I can just refer to one or two points that he makes. He is a man of unquestionable integrity and he begins by saying that he was visited by two gentleman who approached the door with envelopes, and said, “Mr Thomas, I have these for you.” They looked threatening and he asked them for some ID. They said they did not have it and would get it from their van and come back. Some time later they came back but he was on the telephone and his daughter answered the door. She clearly saw a threatening individual. The daughter and Councillor Thomas’s wife retreated to the kitchen. He went to speak to the man and they finished up nose to nose with the man shouting at him, “Take these, Mr Thomas,” and he threw them out and walked away. Mr. Thomas walked after him, and as he walked away the man shouted, “Goodbye, Mr Thomas,” 10 times, in a shockingly intimidating manner.
It gets worse. Later that day Councillor Thomas called at a property that he owns. There were two vans blocking the gate so he tooted the horn to go in, and he found that it was the same people employed by National Grid to enforce its policy. During the conversation, they used the f-word at least three times, an example of gross profanity. Councillor Thomas rang National Grid to tell it, but it seemed not to care. It talked about them being process servers, not bailiffs. This is shocking behaviour.
Another councillor contacted me—
Madam Deputy Speaker (Dawn Primarolo)
Order. I have been listening carefully to what the hon. Gentleman is saying, which is clearly heartfelt, and I have given him much more latitude because of the seriousness of the matter that he raises. But this is the Third Reading of the Energy Bill, and what he says must relate to that, or he might want to find another way to raise what are very important matters. He may continue with his points, but he should either make them relevant to today’s debate or perhaps stake a claim for a future debate.
Glyn Davies
Thank you, Madam Deputy Speaker, for making the allowance that you have. I thought it was important to put that kind of behaviour in the public domain.
What the Government are doing in the Bill is hugely important to the country’s future, but we will not have anyone’s support unless we take forward what we are doing with reason and working in co-operation with the local people. That is what we need to do, so I thought it right to put in the public domain what is happening in our name. This is an important Bill that I am pleased to support, but please let us take forward what we approve today in a reasonable manner that the people of Britain will be able to support.
Mr Christopher Chope (Christchurch) (Con)
The Bill fails to meet four essential tests. First, will this Bill help to reduce energy costs for consumers? At the moment, energy costs for consumers are projected to rise at the rate of about 8% above inflation for the foreseeable future, and the Bill does nothing to address that. In fact, it makes it worse for consumers.
Secondly, will the Bill make UK plc more competitive in international markets? The resounding answer to that question is no, it will not. Indeed, we have already driven a lot of our manufacturing capacity overseas and the Government recently had to include in the Finance Bill a sticking plaster to try to prevent the potteries from closing down completely. That demonstrates that firms that are not perhaps involved in the potteries will suffer as a result of more lack of competitiveness being generated.
Thirdly, will the Bill prevent our countryside and coastal heritage from being despoiled by wind turbines, such as those proposed for Christchurch bay? It will definitely not do that. Indeed, because it is encouraging the subsidy junkies to come to this country and feed off our taxpayers’ money, it will make life even worse.
Finally, does the Bill address any of the perverse consequences that have flowed from the Climate Change Act 2008? The answer is that it does not. Five of us voted against the Third Reading of that legislation, and a lot more colleagues wish that they had also been able to register their opposition to it in the Division Lobby. That is why I hope that tonight, although there is this grotesque cross-party consensus about a lot of this legislation, it will be possible for individual Members to put on record their own views as to whether the Bill should go on to the statute book.
Andrew Percy
I was not intending to speak, but I have been moved to do so by the speech made by the hon. Member for Brighton, Pavilion (Caroline Lucas), who attempted to present those of us who oppose the decarbonisation target as in some way anti-renewable. I voted against the target not because I am anti-renewable but because I am concerned about the bills paid by those who sent me to this place and the impact of onshore wind developments in my constituency.
In the Humber, we hope to benefit from significant investment by Siemens and others in offshore wind. We all stand behind and support that, if for no other reason than it is a job creation scheme. I hope we will see British employers such as Tata—I got things slightly wrong earlier in calling it a British company—benefiting from that. We want that development and those jobs to come to the Humber. However, the attempt to paint those of us who have opposed the decarbonisation target as anti-renewable is not fair at all.
Many of my constituents work in the coal and gas sectors. A large number work in coal and gas generation and some even work in coal mining. I think about their jobs and rights when we debate our energy market. It is not yet clear how the decarbonisation target would be hit or how carbon capture and storage technology could contribute to it. In my side of the constituency, at Drax, a lot of money is going into trying to develop clean coal technology. We want that to be a success. Perhaps in a couple of years’ time, when that is scalable and deliverable, I will be in the Lobby with the hon. Lady.
Caroline Lucas
The hon. Gentleman has not been in the Chamber in the past two days, but over and again those on this side of the House who have been proposing and supporting a decarbonisation target have been able to demonstrate that it will precisely lead to lower fuel bills for consumers. It is precisely gas that is leading to higher bills. Will he not base his statements on the facts?
Andrew Percy
I have followed this debate closely both inside and outside the Chamber, and I am afraid that it has not been demonstrated at all that the target could be set up cheaply. If that were so, it would already be being done. I am concerned about the impact that such a target would have not only on bills, but on England and our countryside. I represent a constituency where people are very concerned about onshore wind turbines. The hon. Lady represents a more urban area, so perhaps she does not have to face what I have to.
Andrew Percy
No, I will not give way. There are very concerned people who feel very disempowered with respect to the planning process because of the march of onshore wind. That has to be taken into account. I am not prepared to vote for something that would say to my constituents, “Whatever your view is, it doesn’t matter. We have this target and we have to deliver on it.”
I think about the public inquiry at Saxby Wold, at which I spoke only a few weeks ago. I got a clap from local residents; it is not often that Members of Parliament get clapped by their constituents. I spoke for my constituents who said clearly that they did not want an ever-increasing march of onshore wind turbines. I also think about the residents in the towns of Winterton and Broughton and elsewhere. Just this weekend, I was informing them about the proposed development in the Ancholme valley of yet more wind turbines—an area that has already hit its 2020 targets.
So please do not present those of us who oppose the target as anti-renewable. We are pro-renewable, but we want a balance and a sensible energy policy that gives the people most affected by the changes a real voice in the process. That is why I will support the Bill. Perhaps in a year, two years or three years, we will be able to support a decarbonisation target. However, the CCS technology is not yet there and I am not prepared to say to people in my constituency who work in the industries I mentioned that they should be put out of work for a vague target that somebody has plucked out of thin air.
Question put, That the Bill be now read the Third time.
Business without Debate
Football Referees
(10 years, 11 months ago)
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Chris Heaton-Harris (Daventry) (Con)
The times being what they are, I feel I should declare an interest at the very start: I have always wanted to be popular. Some would say that being a Conservative Member of Parliament is not exactly the best way of going about that. If we add the fact that I am an active and qualified football referee, one could think that I have chosen what we might call a “challenging path” to that popularity. I took my referees’ course at the age of 12 and qualified shortly afterwards, which I believe means I have just finished my 33rd season as the man in the middle. I have been a member of the Referees Association for all of that time. I should also declare a financial interest. For each game I officiate I receive a fee. I have tried to register it, but the relevant authorities got bored after a while and told me to stop wasting their time.
I have to admit that I love the game. Like anyone who volunteers, coaches or officiates at any sport, I am passionate about the sport I practise every week. One has to be passionate to go out there in most weathers doing one of the least popular jobs in the country week in, week out. I have officiated at all types of games in the UK and abroad at amateur and semi-professional level. I have been very lucky not to have personally experienced what too many referees have experienced: I have not been assaulted while officiating at a game of football.
Every ref I know looks forward to his or her next fixture. While we get paid a small amount, we do not referee for the match fee. We receive good in-service training from the Football Association and the Referees Association, and we go out to do the best job we possibly can in every game. Occasionally—I know this will be hard for Members to comprehend—match officials do make the odd mistake. The vast majority of times, however, we get the decision right. Alas, on some occasions—Members may have seen some well-publicised examples—players do not like the decisions we make. Referees have to deal with that by using common sense.
Jim Shannon (Strangford) (DUP)
Does the hon. Gentleman feel that the introduction of goal-line technology and a fourth official would reduce some of the friction between footballers and referees on the pitch?
Chris Heaton-Harris
I am sure that that would help at the highest level of the game, but at my level I am lucky to have two club linesmen, let alone a fourth official. I hear where the hon. Gentleman is coming from, but I do not think they would necessarily help in this particular situation. There is no goal-line technology in Northamptonshire Combination football league games as of yet.
We deal with challenging situations by using common sense, people management skills and the odd yellow or red card. In most cases, while the teams and their supporters might not like some decisions, everyone just gets on with the game. Sometimes they do not, however. Recorded assaults on referees are thankfully few and far between. The number of physical contacts against officials has fallen quite dramatically by 21% since 2010-11, from 618 cases to 528, but that is still 10 physical assaults on football referees in England and Wales each week.
Stephen McPartland (Stevenage) (Con)
Does my hon. Friend agree that the number of recorded assaults on referees has decreased because it is often difficult for referees to have those assaults taken seriously by the authorities?
Chris Heaton-Harris
Yes, that is absolutely the case, and it is something I intend to come to later, so I thank my hon. Friend for his point.
In fact, over the past year, the number of cautions has fallen: all cautions fell 10%; dissent cautions fell 13%; dismissals fell 13%; and in general all misconduct on the football pitch fell 9%. Some put this gradual improvement down to the Football Association’s respect agenda, and I would tend to agree, but whatever the reason, it is obviously to be welcomed. I still find it astonishing, however, that in the last year for which full records are available 528 referees—more than 10 a week—were assaulted during a match.
Obviously, in these cases, the Referees Association and the FA step in, the first helping the assaulted and the county FA offering some punishment post-disciplinary hearing. There were concerns that county FAs were being too lenient in the punishments handed out, so several changes were made to the appeals process. Now anyone, not just the person subject to the violation, can appeal a decision and ask the FA to review the case. For the police to take action, referees must report incidents to the police themselves. The FA recommends that they do this but cannot intervene or compel an official to do so. If criminal action is taken in a case of assault or physical contact on a referee, the player in question is automatically suspended pending the outcome of the case.
The purpose of this debate is singular: to ask the Minister for his help. Referees up and down the country are becoming more and more concerned that neither the police nor the Crown Prosecution Service is following through with the investigation of assaults, believing that footballing sanctions—bans for a certain period—are enough of a punishment. It would be fantastic, therefore, if he could help. The FA could do with improved feedback from the courts.
Guy Opperman (Hexham) (Con)
I congratulate my hon. Friend on securing this debate, which one might think a game of two halves: the soft cop in the early part and the rougher stuff coming later. Does he agree that the FA could improve conviction and prosecution rates by launching private prosecutions where other parties do not wish to get involved? That would, I suggest, still be possible.
Chris Heaton-Harris
That is true, actually. The Referees Association offers insurance to referees, so if someone joins it—not all referees do, but most do—it will help and guide them down that route. If, though, there is a physical assault on a football pitch, it should first be a matter for the police, but if they choose not to act, perhaps there could be this second way of doing it.
To return to the subject on which I would like the Minister’s help, the FA would appreciate automatic feedback from the courts on football cases to ensure that any criminal cases involving footballers are also subject to football disciplinary hearings. A simple communication would suffice to ensure that if a banned player tried to play for a different football club, they would not be allowed to. Furthermore, assaulting a referee should automatically mean a formal interview by the police. It has been suggested that sometimes the police only log details and do not formally charge a player with assault, saying that it is a footballing matter. Any player who assaults a referee should be formally interviewed by the police as a matter of course, and witness statements could be taken to prepare for appropriate action. A simple interview after an assault would also act as a strong deterrent.
In the more serious cases, we need to urge the CPS to treat this type of assault seriously and to ensure that football offences do not receive more lenient sentences than the same crimes committed off the football pitch.
Ian Lavery (Wansbeck) (Lab)
I congratulate the hon. Gentleman on securing this important debate. He has mentioned serious offences, suggesting that some are not so serious. What would he say is the difference?
Chris Heaton-Harris
Less serious offences would include one that the hon. Gentleman might have seen Paul Gascoigne commit in a football game not so long ago—taking the yellow card out of the referee’s hands—or a gentle shove. If the hon. Gentleman will allow me, I will come to the details of more serious offences, but there is a gradual scale, as there is in all matters to do with assault.
Essentially, referees would like the police to be more willing to charge those who assault match officials, rather than leaving the issue to be dealt with in-house by local county football associations. Police action is a far greater deterrent and would ensure that referees felt more supported, thus helping to retain the number of referees we need in our game.
I said earlier that I had been lucky. I have not been physically assaulted while officiating, although I once had to go to the police because of what I perceived to be a very real threat made against me. However, I had a horrible experience once when I gave a penalty and the manager of the team, who thought he was a bit like Alex Ferguson, did not like my decision. Unlike Alex Ferguson, he decided to charge on to the pitch. Fortunately, one of his own players rugby-tackled him, inches away from me on my blind side before he got to me. As I did not really know that he was coming at me, who knows what could have happened? That happened on what I chose as my last ever game of Sunday morning football.
Others have not been so lucky. Anyone who goes to a referees’ society meeting and talks to those present will hear some horrific tales. In 2011, a Coventry referee was assaulted at a match that took place on Sowe common on a Sunday morning. He was taken to hospital by ambulance and needed stitches inside his mouth and other things. Two police cars attended with four officers. Two of the officers went and spoke to the assailant, but decided not to arrest him and walked off the pitch saying that the football authorities would deal with the incident.
Last year in Manchester, an individual walked out of court with a suspended jail sentence and community service for a cowardly assault on a referee. The referee had sent the player off for aggressive behaviour and swearing during a Manchester amateur Sunday football league match. As he recorded the red card in his notebook, the player ran towards him, jumped with both feet off the ground and kicked him in the face—a karate kick of some kind. The referee needed a number of stitches around his eye and was left scarred for life. Doctors told him that he was lucky not to have been blinded. The player was eventually charged and pleaded guilty at a Manchester Crown court to the charge of assault occasioning actual bodily harm. The judge did not give him a custodial sentence—he said he had escaped “by a whisker”—but suspended a 10-month jail sentence for two years. The player was also ordered to carry out 100 hours’ unpaid work and pay the referee £750 compensation. However, if that had happened on a Saturday night in any town or city across the country, the result would have been very different.
Referees across the country are concerned that assaults of this nature are not always taken seriously by the authorities. We are seriously worried about that, because we know of recent examples elsewhere, such as the case of Richard Nieuwenhuizen in the Netherlands, who was killed in December 2012 as he officiated at a game of football in Holland, or, just last month, that of Ricardo Portillo in the United States. In both cases, the assault of an official resulted in their death. I am not saying to the Minister that he must act now or this could happen here, but I would like assurances from him that, after this debate, he will send the appropriate message, as strongly as he can, that officials of all sports across the country can pack their kits for this weekend, comforted in the knowledge not just that they are appreciated, but that there is an extra deterrent that will stop those who use violence to show their disappointment at a decision that the ref has just made.
The Parliamentary Under-Secretary of State for Justice (Jeremy Wright)
Before I begin, I would like to congratulate my hon. Friend the Member for Daventry (Chris Heaton-Harris) on securing the debate and on raising the important issue of how we deal with violence in sporting events. As he says, it is an issue that we need to take seriously, and we will. Such violence can be damaging not just for the individuals directly concerned but for all those who enjoy sport. They should be able to continue to do so in safety and in an atmosphere where the rules of justice and fair play are accepted and upheld. The respect that we show for the rules of a game such as football very much reflects our respect for others, for society and for the rule of law.
As my hon. Friend has made clear, football is one sport that has seen particular examples of violence on and off the pitch. Such violence sets a damaging example to young and possibly impressionable fans. We know of cases in which fans have been tempted to emulate the behaviour they see on the pitch. We must therefore make absolutely sure that we have the means available to prevent such violence where possible, and to punish it effectively if it does occur.
Looking at the cases that my hon. Friend has detailed, I can entirely share his concerns. I understand the frustrations felt by all the victims who do not feel that justice has been done. It seems that we have three fronts on which we should be tackling this issue. First, each sport’s governing body—in the case of football, the individual clubs—needs to deal with the incident to ensure that future events are not disrupted. They can and should discipline players and fans when enthusiasm spills over into violence and aggression. It is not clear from the cases that we have heard about whether clubs or the Football Association have always used the full extent of their powers, but my hon. Friend will appreciate that that would be a matter for my right hon. Friend the Secretary of State for Culture, Media and Sport.
Secondly, the criminal justice system has a role to play. My hon. Friend has rightly asked me and my Department to concentrate on the issue of effective sentencing, particularly for violence against referees. From that perspective, we would not want to see offences, sentences or procedures that applied only to football referees. The law must be seen to apply equally and consistently to everyone, and we would therefore need at least to deal with violence at all sporting events. We already have adequate offences, sentences and procedures in place that apply across the board, and ample guidance to help to ensure that they are applied consistently. With that in mind, let me first explain the offences available.
There is a range of offences that the police and the Crown Prosecution Service can use in the case of a violent incident of any kind, including when the violence occurs in a sporting context. These range from common assault through to actual bodily harm and to grievous bodily harm, and ultimately to manslaughter and murder. The penalties available range from a maximum of six months’ imprisonment for common assault to a maximum of life for wounding with intent to cause grievous bodily harm. The police and the CPS have a full spectrum of offences that can be charged, and severe maximum penalties are available for those convicted.
Within those sentencing powers, it is for the courts to decide what the penalty should be in individual cases. The courts have the full facts of the case before them, and they can make an informed judgment about the overall seriousness of the incident. Sentencers are trained and experienced in arriving at appropriate penalties, and it would be wrong for any of us, particularly Ministers, to try to substitute our judgment for that of the court. I will not therefore comment on the individual cases that my hon. Friend has raised; instead, I will concentrate on how the courts arrive at their decisions.
The courts have guidance in the form of guidelines issued by the independent Sentencing Council. Courts are obliged to follow the guidelines or to explain why, exceptionally, they are departing from them. The guidelines are therefore rather stronger than the term “guidelines” might suggest. There are guidelines covering the general seriousness of an offence, and specific guidelines on offences of assault, and they can be found on the Sentencing Council’s website. As with offences, I do not think that it would be helpful to have specific guidelines that applied only to football referees, or even to sport in general. They must apply across the board.
The guidelines help to determine the seriousness of the offence by reference to the harm that the offence has caused, and to the culpability of the offender. Those factors can mitigate or aggravate the potential sentence. For example, in the case of assault, factors given in the guidelines as increasing the seriousness include the location and timing of the offence, and the community impact. General guidelines on the seriousness of any offence also include aggravating factors such as whether the victim is serving the public. That might arguably include functions such as refereeing a football match, as my hon. Friend does on a regular basis.
People often ask, not just in this context, why the maximum possible penalties for offences are not imposed more often. Sentences must be proportionate to the offending behaviour, and the guidelines help to ensure that the courts sentence in a proportionate and consistent way. The maximum penalty is set to deal with the worst possible case for each offence. The maximum is, therefore, rightly rarely used. Violence and threats towards match officials may be regarded as an aggravating factor, but should not be looked at in isolation as meriting the most serious possible penalty. It needs to be seen alongside all the other aggravating and mitigating factors in a case.
The third strand that emerges from the cases we have heard about this evening is how the police react in cases of violence against officials. That, I have to say, is partly a matter for my right hon. Friend the Home Secretary, but it is largely, as my hon. Friend will understand, an operational matter for the police. I understand entirely what he says about the need to send the clearest possible message to the police about taking these matters seriously. We need to work with officers to ensure that they have guidance and training about cases involving match officials, so that those cases are treated in a way that properly reflects the harm such cases can cause.
I am afraid to say to my hon. Friend that there is no magic solution to the problem that he has rightly highlighted. I think he recognises that. I accept that we need to work together to raise awareness and to ensure that the system we have works better. We need to ensure that we signal that violence against match officials is wholly unacceptable and will not be tolerated.
Question put and agreed to.
Ministerial Correction
(10 years, 11 months ago)
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Communities and Local Government
(10 years, 11 months ago)
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Chris Ruane
To ask the Secretary of State for Communities and Local Government if he will give consideration to reforming the system of compulsory purchase orders to allow local authorities and business improvement districts to buy a medium-term lease on empty shops.
[Official Report, 15 May 2013, Vol. 563, c. 290W.]
Letter of correction from Nick Boles:
An error has been identified in the written answer given to the hon. Member for Vale of Clwyd (Chris Ruane) on 15 May 2013.
The full answer given was as follows:
Nick Boles
Local authorities have a power under section 13 of the Local Government (Miscellaneous Provisions) Act 1976 to acquire new rights over land which do not exist at the time the compulsory purchase order is made. This would include a lease. As with all compulsory purchase orders, the acquiring authority would have to demonstrate that there were no impediments to their scheme going ahead and that it had a compelling case in the public interest to deprive the owner of the land of his property rights.
The correct answer should have been:
Nick Boles
Local authorities have a power under section 13 of the Local Government (Miscellaneous Provisions) Act 1976 to acquire new rights over land which do not exist at the time the compulsory purchase order is made. However, this would not include a lease, which is an interest in land, rather than a right over it. An authority seeking compulsorily to acquire an interest in land would have to demonstrate that there were no impediments to their scheme going ahead and that it had a compelling case in the public interest to deprive the owner of the land of his property rights.
Westminster Hall
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Vocational Education
(10 years, 11 months ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Nic Dakin (Scunthorpe) (Lab)
On this sunny morning, it is a real joy to see you in the Chair, Mr Gray, and I hope that our expectation of great chairmanship will be delivered by the end of the sitting.
Tomorrow is vocational qualifications day, so this debate is particularly timely. That annual celebration of vocational qualifications is organised by the Edge Foundation and quite properly supported by all political parties and, most importantly, by colleges, training providers and awarding bodies. Celebrations and events will be held around the country, with outstanding achievements being recognised through VQ learner and employer awards. By celebrating learners and employers, VQ day recognises that the relationship between them, supported by providers, is crucial if we are to deliver effective vocational learning that meets the needs of both employers and the economy.
I have been struck by the number of individuals and organisations that have contacted me to say that they are extremely interested in today’s debate, including Cambridge Assessment, Clive Wilson—Franklin College’s excellent associate principal—the Association of Colleges, the National Grid, the Society of Motor Manufacturers and Traders, Pearson, the National Institute of Adult Continuing Education, the Prince’s Trust, the Federation of Small Businesses, the National Union of Students, McDonald’s and the Science Council.
That avalanche of interest is all the more amazing for the consistency with which those different organisations have raised the key issues for setting the landscape fair for vocational education in future. I can identify four broad concerns: first, the need for vocational education in key stages 4 and 5 to be placed in a broad and balanced curriculum offer; secondly, the importance of careers information, advice and guidance being impartial and linked to the economy’s needs; thirdly, the role of apprenticeships; and finally, the challenge of reskilling adults, particularly those who have become workless. Let me take each in turn.
The first issue is about all students having access to a vocational offer within a broad and balanced curriculum. Edge states a bold vision that I hope we can embrace. It has stated that it wants
“an education system where people discover all their talents achieve excellent results and are better prepared for apprenticeships, higher education and work”.
In my opinion, having worked hard to lead a college in delivering improving progression outcomes for students year on year, secondary education in 2010 had arrived at a positive place. That was largely down to the practical good sense of school and college leaders, exam boards and employers, working together within a largely stable framework set by the Government.
David Simpson (Upper Bann) (DUP)
I apologise for being late, Mr Gray. I congratulate the hon. Gentleman on obtaining this debate. For many years in Northern Ireland, it was them and us—it was the industry and educationists—but over the past couple of years, the two sides have come together, which encourages young people and helps them to get the skill base that is essential. Does he agree that that is certainly one way to achieve what he wants?
Nic Dakin
Absolutely. The hon. Gentleman makes an excellent point about employers and educationists coming together to set an agenda, which can be very powerful in liberating young people and delivering on their potential.
Through a focus on personalised learning, student achievement was being raised and student progression to work and higher education improved. Such personalisation of learning is important. Through the flexible use of BTEC firsts and BTEC nationals, as well as similar qualifications, general vocational qualifications were finding a place alongside GCSEs and A-levels, which led to students achieving more at both 16 and 18. Most importantly, progression into employment and higher education, though not perfect, was strong and improving.
Interestingly, a new study by London Economics shows that a higher proportion of students who do a BTEC and a degree end up in work than those who do straight A-levels and a degree. The research also shows the highly vocationalised HE choices of ex-BTEC students, particularly in STEM subjects—science, technology, engineering and maths—and business finance. Across all regions, BTEC graduates in skilled occupations earn more than their contemporaries. The curriculum we had in 2010 is therefore delivering results for us today. Even the ill-fated diploma spawned the engineering diploma, which has been fêted by engineering employers and HE providers for placing industry in the curriculum driving seat, thereby delivering for young people and the economy, as the hon. Member for Upper Bann (David Simpson) has pointed out.
Jim Shannon (Strangford) (DUP)
I thank the hon. Gentleman for securing in this Chamber a very important debate, which every one of us can relate to our own constituencies. Does he agree that one important opportunity in engineering at the moment is for young girls and young ladies? It is a job not only for young men, but for ladies and girls. There has been an example of that in Northern Ireland, with more young girls—and young people—being involved and wanting to do engineering. Should more be done to promote that among the female part of the population?
Nic Dakin
The hon. Gentleman makes an excellent point. Many good projects are in place to get girls into engineering, and they must continue to be supported. I noticed in the information sent out by the National Grid how much it stresses the importance of bringing more women into engineering. After all, that covers 50% or so of the potential talent pool, so we need women engineers to help to drive forward the economy.
I hope that the Government, in their consultation to reform vocational qualifications for 16 to 19-year-olds, listen to the wise counsel of the Association of Colleges and others, who caution against a rigid approach to routes that divide qualifications and young people into particular outcomes. The AOC’s Martin Doel has made the point well:
“Currently students can choose a mix of qualifications: they can study an A level alongside a substantial vocational qualification. We are concerned that separate ‘routes’ which segregate qualifications into pre-determined categories will restrict student choice.”
Edge’s insights are also helpful. It has argued:
“Vocational education is often presented as suitable for the 50% of young people who don’t go to university. Young people who do well in academic subjects are systematically steered away from vocational options. This is wrong: it limits choice. All young people should experience academic, artistic, technical, practical and vocational learning as part of a broad and balanced 14-18 curriculum which leads to an overarching diploma at 18.”
The overarching diploma sounds like Labour’s excellent tech bacc initiative, which the party is sensibly consulting on, and which forms part of the ongoing work of Labour’s skills taskforce, chaired by Professor Chris Husbands. By contrast, the Government are in danger of rushing out their alternative tech bacc without sufficient thought and planning, on a time scale that risks endangering the principle of developing a sound alternative for the forgotten 50%.
The Government would do well to listen to organisations such as Edge, which has a track record of engaging successfully with employers in delivering change through their university technical college programme and other initiatives, but, sadly, listening is not one of the Government’s strong points. They turn a deaf ear to those who speak with experience and knowledge, and instead assert that they, the Government—many of them have never worked outside policy think-tanks or media bubbles, and never worked in the real world—know best, even when confounded by the evidence. They pooh-pooh the evidence and press on regardless with their curriculum vandalism. A prime example is their insistence on imposing their narrow key stage 4 EBacc and the limited number of facilitating A-levels, set in a nostalgic image of 1950s grammar schools. Even today, The Times reports that these curriculum vandals are planning to replace GCSEs—a well understood and recognised brand—with something called “I-levels”. Will they never learn?
Before the Minister splutters that to criticise such a direction of travel is to accept lower standards and to become globally uncompetitive, let me assure him that it is not. Wanting high standards is a given across the parties; they are what we all want for our young people. Such an aim is not negotiable. Ironically, the Government’s deafness to evidence and their rejection of the common-sense approach of building on what they inherited in 2010 imperil the high standards that they say they seek. If there is any doubt about that, just reread the Education Committee’s excellent report on the EBacc.
The second area of universal concern was the state of careers education, information, advice and guidance. Again, the Select Committee did some excellent work in exposing the disastrous impact that the Government’s policy has sometimes had on that area. In our debate on the Select Committee’s report in this Chamber last month, it was clear that MPs across the House shared its concerns, but are the Government listening? I fear not. The AOC points out that good advice and guidance is crucial to helping young people make the right choices, and it draws attention to the perverse incentives in the current system that allow new schools to be established even where there is an over-supply of places, which is madness. As it points out, that militates against the provision of truly independent information, advice and guidance, because such advice might, for example, encourage a young person to consider other options than simply staying in the sixth form and doing A-levels.
The National Grid, and other such employers, recognises the value of work experience. It is disappointed that it is no longer a statutory requirement for schools in key stage 4. It says:
“We would urge policy makers to ensure that pre-16 students do get the opportunities to see industry at first hand—particularly STEM based occupations.”
The Federation of Small Businesses calls for a significant programme of careers education from early on in a young person’s education. As Edge says, a show-and-tell approach to careers is badly needed. Starting in primary schools, young people should meet and visit a wide variety of employers, apprentices, further education colleges, training providers and universities. They should also go to events such as the skills show in Birmingham, which has skills competitions, exhibitions and “have a go” areas.
Interestingly, we have just completed an employer-led investigation into the skills needs of the Humber, which I chaired on behalf of the Humber local enterprise partnership. The report, “Lifting the Lid: the Humber Skills Challenge”, will be published on Thursday. Two of the most significant concerns are the quality of careers education, information, advice and guidance and the lack of overriding priority given to teaching those essential employability skills. Why do the Government not rectify that by giving the resource, capacity and capability to LEPs to make the improvements that are badly needed to ensure that the education service delivers what local employers need both now and into the future? That is a way to deliver through City Deals what is needed and to allow city region leaders to make things happen. Why not go further and let LEPs commission Ofsted to do area-wide inspections of the teaching of employability skills in their areas? That would be localism in action and would directly empower employers and reward positive engagement between employers, education and training providers in a locality.
The third thing on which everyone agrees is that apprenticeships provide a significant work-based training opportunity as part of the vocational offer. The National Union of Students underlines the relationship between good impartial careers information, advice and guidance and the uptake of apprenticeships. It says:
“If more people are to be encouraged to enter higher level apprenticeships then work must be done to raise the profile amongst those responsible for delivering IAG.”
Both the previous Government and the current one have done some good work in developing and strengthening the apprenticeship brand, but, as Tim Oates of Cambridge Assessment points out, what is really needed is a strong focus on revitalising the classical apprenticeship. The Richard review represents a strong step in the right direction, and Labour’s skills taskforce interim report is right to take the matter further. It says:
“Apprenticeships need to be longer, more rigorous and focused on the skills that will take our economy forward.”
The Work Foundation is right to recommend that Government should seek to persuade all large employers to sign an agreement to offer high-quality apprenticeships. There is an important leadership role to be played by employers’ organisations such as the CBI and the British Chambers of Commerce to encourage even more employers to come forward and get involved.
In the Humber, we also identified a possible leadership role for the LEP not only in championing apprenticeships, but in considering establishing an apprenticeship training agency or an apprenticeship hub to support more small and medium-sized enterprises to take on apprentices.
In the quite understandable rush for robust higher level apprenticeships, there is a real danger of unintended consequences. We need to be alert to the concerns of the Society of Motor Manufacturers and Traders, which says that
“it is imperative that the overall framework remains the same in order to provide stability and consistency for users.”
Furthermore, if access to level 2 apprenticeships is swept away, we risk leaving a significant gap for the almost 50% of youngsters who do not achieve the progression benchmark of five A* to C grades with maths and English to access level 3 programmes. Currently, they can access work-based training through that route.
Jim Shannon
Are we not in danger of leaving some people behind? I am talking about those who perhaps do not have the educational skills but who have the hand skills. It is important that we bring on those people as well. What opportunities can we give such people to enable them to reach high levels of achievement as well?
Nic Dakin
The hon. Gentleman puts his finger on the button. I am sure the Government will think through this matter carefully, because it is an area where further thought is needed.
Around 350,000 learners are currently on entry level and level 1 and 2 courses in colleges. The number of students seeking those sorts of courses will rise with the raising of the participation age. Serious thought needs to be given to how to give them the best work-based training options in the future. One option might be to look at developing longitudinal traineeships—the Minister is keen on championing traineeships—that can be matched to longer-term vocational training when considered as part of 16-to-19 study programmes. It would also be sensible to consider how the model might be extended into employment for those who are ready for work, but who are not academically able to access level 3 apprenticeships. If level 2 apprenticeships are no longer available, there needs to be funded flexibility in approach to support young people into meaningful, sustainable work through the traineeship brand.
The final area of concern relates to adult reskilling, particularly when trying to support and encourage people out of worklessness into employment. The National Institute of Adult Continuing Education, which has a long history of success in this arena, makes a strong argument for allowing flexibility and bite-sized learning to be funded in a way that supports learners and employers. More than anything else it believes that
“adult vocational qualifications need to be recognised by learners and employers as well as providing flexibility in terms of design and credit accumulation. There is no doubt that the current levels of learning are not well understood; there is also no doubt that A-levels and degrees have better recognition even though they may not be fully understood. Our work with learners, employers and providers has shown that the unitised and credit accumulation approach which the QCF allows is powerful in helping people get into work and to improve their skills.”
In addition, it is clear that vocational skills delivery for the unemployed requires much more effective join-up between the Department for Business, Innovation and Skills and the Department for Work and Pensions. There have been improvements to the delivery, and the Government should be congratulated on them, but there need to be more. The divide between those who are on the Work programme and those who are the responsibility of Jobcentre Plus does not encourage the development of the holistic, collaborative, personalised programmes that are needed to get people into sustainable employment. There remain silly barriers to accessing training, whereby people’s benefit receipts can cease prior to their securing work even when appropriate training is being followed.
In our Humber Skills Commission, we are bidding for the LEP to be empowered to control and oversee the delivery of programmes to tackle unemployment locally, and to be granted the authority to align local resources more effectively to that end. Such an approach, which would put local businesses and employers in the driving seat to motivate and reskill their local work force, may well be part of the answer. What is undoubtedly clear is the need for more ladders of opportunity and success to be created if we are to get the best out of the people we have already got. So, on the eve of vocational qualifications day, I am pleased to have had this opportunity today to stimulate a debate on the future of vocational education.
Robert Halfon (Harlow) (Con)
Thank you, Mr Gray, for calling me to speak. It is a pleasure to serve under your chairmanship today.
I congratulate the hon. Member for Scunthorpe (Nic Dakin) on securing the debate. He is a complete expert on this issue, given his background, and I have been pleased to campaign with him on a subject that I will touch on later.
Part of the problem with debates on vocational education is that too often it is just seen in terms of its utilitarian value to the economy. We need to change that approach and see vocational education as a form of social justice. If vocational education is just subject to economic efficiency, it will always be subject to the whims of current economic policy. Vocational education should be integral to the national curriculum and the well-being of our young people. It provides a ladder away from poverty for the most disadvantaged.
The question we have to ask is why—despite all the initiatives begun under the previous Government—did youth unemployment rise to 1 million? Although this Government have stemmed the tide, youth unemployment remains a huge problem. To consider the issue holistically, we need a cradle-to-grave cultural change in vocational education.
Problems with youth unemployment do not just start when young people enter the job market; they start at home, with disadvantaged families. The problems carry on into our primary schools—such that one in five of our children still leave primary school unable to read, write or add up—and they continue into secondary school.
What can we do to change that situation? First, we must transform the reputation of skills and apprenticeships, which will require a sea change in our culture. Secondly, we must transform our vocational infrastructure. Thirdly, if—as I have argued—vocational education is about social justice, we need to ensure that resources are directed at the most disadvantaged. That means not only providing the ladders of opportunity, which the hon. Member for Scunthorpe mentioned, for those who want to get on, but reaching those who will not even take the first step.
For far too long we have talked about university, which has led to vocational education falling into neglect. Vocational education came to be seen as a second-class option, only suitable for those who did not want to do A-levels, rather than being seen—as it should be—as equal to university. If we are serious about tackling youth unemployment, we must ensure there is a parity of esteem between vocational education and traditional academia.
That is why I have been calling, since I have been in this House, for the introduction of a royal society for apprenticeships, which would work in a similar way to the Royal College of Surgeons and other such bodies. A royal society would dramatically increase the prestige and culture of apprenticeships, marking a sea change in how apprenticeships are viewed.
We also need to expand the range of jobs that vocational education can offer. Traditionally, people have assumed that if someone does an apprenticeship that means they must become a builder or a plumber. That assumption is wrong, which is why I took on Parliament’s first apprentice three years ago. I am now on my third, Aaron Farrell, who works in my office four days a week as well as studying for a level 3 apprenticeship in business administration. This experience has been good for Aaron and for my office, and I am pleased that other Members are beginning to do the same. Also, I pay tribute to the senior Clerk of the House of Commons for establishing the Clerk’s apprentices scheme. It is invaluable for a profession that is often seen as being closed off to those who are from a disadvantaged background.
We also need to make teachers aware of the benefits of apprenticeships. Edge has already been mentioned and according to that organisation two thirds of teachers regard their knowledge of apprenticeships as poor, and just one in four teachers recommend apprenticeships over higher education. Sadly, 23% of A-level pupils still say their school is far more concerned with “sending students to university”. That contrasts sharply with parents’ wishes. A clear majority of parents—78%—would support their child if they chose to take the vocational qualification route. Research from the Department for Business, Innovation and Skills shows that people who have a higher apprenticeship are 25% more employable than university graduates and that on average those with an apprenticeship qualification earn over £100,000 more throughout their lifetime than other employees.
I am glad that the Government are taking steps to address the problem of prestige and I welcome the technical baccalaureate, according to which vocational courses should have the same rigour and prestige as A-levels. However, we must go further. We need to encourage teachers to find out more about the benefits of apprenticeships and to promote those benefits directly to young people and their parents.
That can be done in simple but effective ways. For example, Harlow college, which I must remind the House is the No. 1 college in England according to the Department for Education, has a fantastic record of offering vocational education for young people and it recently held a very successful apprenticeship fair. Consequently, young people can make well-informed choices and apprenticeships can get the fair hearing that they deserve. A royal society for apprenticeships would offer rewards to apprentices in the same way that university students get graduation ceremonies.
However, this process is not all about changing the reputation of apprenticeships. We also need to provide the infrastructure to make it easier for businesses to take on people to gain vocational skills. To be fair to the Government, they have made good progress on that. I disagree with the hon. Member for Scunthorpe, who believes that the Government are only interested in academia. The Government have shown that they support vocational education by investing £1.5 billion in the sector in this financial year. As we know, since 2010 the number of apprenticeships in the country has increased by hundreds of thousands, and just last year in my constituency the number of apprenticeships increased by a phenomenal 78%.
Gordon Birtwistle (Burnley) (LD)
Does my hon. Friend agree that one of the problems with further education for young people is the lack of proper careers advice for them at the ages of 11, 12 and 13? That is the desperate situation that we have—young people are not given any professional careers advice, or they are only given very minimal advice, when they reach 12 or 13. That is the critical age, when such advice should be given.
Robert Halfon
I agree with my hon. Friend, but this issue is not just about careers advice. As I have said, children in school also need to be encouraged to do vocational education, which at the moment they are not.
Tristram Hunt (Stoke-on-Trent Central) (Lab)
Now that careers guidance has been placed inside schools, does the hon. Gentleman believe that schools necessarily have an in-built producer interest to say to young people that their best interests are served by staying on at school because the money will follow the pupil, and that what we are seeing is exactly the fears about the lack of clear pathways into vocational education being realised?
Robert Halfon
Unless I misunderstand the hon. Gentleman, as I understand it the school leaving age has been extended to 18 anyway, which was something the last Government did. Given that, I think that if we change the culture in our country, schools will encourage their pupils to take vocational education over university. As I say, we need to change the culture and emphasise to pupils that the vocational qualifications that they will be encouraged to consider will be as prestigious as taking university degrees. On that basis, we should not forget that in this Parliament the Government are setting up 24 university technical colleges—in essence, pre-apprentice schools—and I am incredibly proud that Harlow is getting one, which will open next year. However, we must not settle; we should be aiming to set up at least a hundred such colleges.
We should also be encouraging employers to take on more apprentices. One major hurdle that employers face is the lack of basic literacy and numeracy skills among young people, and we must look at that issue. Recent figures show that 17% of 16 to 19- year-olds are functionally illiterate and that 22% of them are innumerate. It is essential that apprenticeships place a greater emphasis on these basic skills, so that young people are ready to join the work force.
As a country we must create the right climate to encourage businesses to hire apprentices. We have made good progress with this, creating the apprenticeship grant for employers, which gives employers who employ fewer than 1,000 people a grant worth £1,500. It is currently available to employers until 31 December 2013. We will know that the grant is successful if it boosts the uptake of apprenticeship programmes. A new charity called Access is encouraging young people, offering 10,000 youngsters work experience programmes. We need to look at and support such schemes.
Subsidising businesses to take on apprentices works. Essex county council has a groundbreaking apprentice scheme and its employability and skills unit saw apprenticeship starts increase by 87% in 2011, compared with a national average of 21%. The council provides a wage subsidy of up to 70% for businesses taking on new or additional apprentices. If possible, I would like that to be replicated across the country. I look forward to the successes in Essex, led by Councillor Ray Gooding.
I also welcome the idea of a skills tax credit, which would give employers a stronger incentive to hire an apprentice and would create a stronger relationship between the employer and the apprentice. That was recommended in the Richard review of apprenticeships last November. I urge the Government to consider it.
Parliament should lead the way, with clear apprenticeship career paths in Departments. The Minister knows, because I have spoken to him about this before, that I believe that all Departments should replicate the Department for Work and Pensions’ new model procurement contract, which encourages, but does not compel, their contractors to hire apprentices as at least 5% of the work force. That has resulted in the employment of nearly 2,000 extra apprentices who deliver goods and services to the DWP. It is revenue-neutral and should be extended across Whitehall.
As well as changes to incentivise employers to take on apprentices, there should be changes to encourage disadvantaged young people to participate in vocational education. There are currently 900,000 people aged 16 to 24 in England not in education, employment or training. This figure has increased by nearly 50% over the past 10 years and accounts for 14.5% of all young people in England.
We know that 90% of young people who complete their apprenticeship go on to further employment, but some obstacles actively discourage young people from vocational education, particularly if they are from disadvantaged backgrounds. For example, young people at further education colleges are not entitled to free school meals, even if they meet the criteria for them, whereas their peers at sixth form do receive them. The civil servants have said to Ministers that it is too expensive and that schools do not get direct funding for it, even though they are required to provide it by law. The Association of Colleges estimates the cost of extending the right to free meals to college students at around £38 million. I believe that this money can be found through efficiencies. If we are to support vocational education, we cannot say to students who attend FE colleges, which are primarily focused on vocational education, that they are not allowed to have a free school meal even if they qualify for one. That injustice cannot continue.
Nic Dakin
The hon. Gentleman makes an excellent point. He probably recognises, as I do, that FE colleges take a higher proportion of people from disadvantaged backgrounds than sixth forms in schools and that they are also a large provider of education to young people aged 16 to 18.
Robert Halfon
I am grateful to the hon. Gentleman, with whom I am pleased to have worked on this issue. We have only one sixth-form school in Harlow and the rest of the children go to a sixth-form college, where disadvantaged students are denied free school meals. That situation is untenable.
The Association of Colleges found that 79% of colleges thought that free school meals for 16 to 18-year-olds would encourage them to stay on in education. The principal of my local college says, “If I can get them through the door and we can give them a good meal, I know that I can turn their lives around.”
I would like to follow the lead of Essex council, which has an apprenticeship scheme that primarily helps disadvantaged young people, particularly single mothers. I was pleased that the Government replaced the education maintenance allowance with a bursary for 16 to 19-year-olds. That is good news, as it provides targeted support for those who need it most, but it is important that the Minister assesses what impact it is having and whether it is encouraging participation. The terms of the bursary must also be looked at. It should not operate in a similar way to the House of Lords, where you get paid just for turning up, but should reward students for their hard work, for example, if they meet or exceed their academic targets. It is right that we reward hard work, and doing so would proactively reward those who are in the most need and who are doing the right thing.
At the beginning of my speech, I said that improving apprenticeships is not just about economic efficiency, but is a necessary consideration. In 2012, youth unemployment cost the Treasury £4.8 billion. That is more than the total budget for 16 to 19-year-olds in England. According to a study by the Association of Chief Executives of Voluntary Organisations and the University of Bristol, the net present value of the cost to the Treasury, even looking only a decade ahead, is approximately £28 billion. So it is essential that in these tough economic times we take action quickly. But we must not forget that this is about social justice. Young people are our best defence against poverty. If we give them opportunities, skills and training, we get them off the street, give them stability and a real chance of a job in the future. The Government, in many ways, are taking the right decisions, but we must go further and faster. We need a conveyor belt of apprentices changing the culture, changing our schools, and changing how vocational education is perceived.
Mr Iain McKenzie (Inverclyde) (Lab)
It is a pleasure to serve under your chairmanship, Mr Gray. I will take your direction about this debate, in the knowledge that education is devolved to the Scottish Parliament.
I congratulate my hon. Friend the Member for Scunthorpe (Nic Dakin) on securing the debate, which, in the current economic climate for young people, is very welcome. The subject is dear to my heart. I have been working with companies locally in Inverclyde and encouraging them to start thinking about increasing apprenticeships and to reach out to young people in our community, in the knowledge that apprenticeships—perhaps, the original “earn as you learn”—include a commitment to vocational and further education.
For too long, we have not paid enough attention to the 50% of our young people who do not go on to higher education. Those young people have suffered, and our economy has suffered. The central question is how to reform an education system, so that it equips young people with the skills and knowledge that they need to play their part, both as active citizens and as future business leaders and entrepreneurs.
It is not that our education system in Scotland is without problems and does not require improvements. Let me highlight some steps implemented to address some of the points that I have just raised, regarding active citizens, future business leaders and entrepreneurs. There is partnership between the schools and colleges, but unfortunately, as we have seen in Scotland, our colleges are under threat, as is our vocational education, because of the Scottish National party Government’s commitment not to charge fees for university places.
Mr James Gray (in the Chair)
Order. I had a word with the hon. Gentleman before he spoke. Inverclyde is, of course, in Scotland, and this is a devolved matter. The debate is on future of vocational education in England and therefore he must address all his remarks to that question. He may not divert into the Scottish national Government or any other matter to do with Scotland. He must talk about vocational education in England.
Mr McKenzie
Thank you, Mr Gray. I will take that direction.
Of course, the curriculum had to change to reflect what business was advising us about problems with employing school leavers. I have spoken to my local businesses and the chambers of commerce about what they required when hiring young people leaving school. The reply was always the same, and perhaps it is the same across the country. They said that they receive young people into the employment world, unready and lacking in the skills to contribute immediately to their business from day one.
Businesses need employees who can apply initiative and solve problems and innovate with limited supervision. There was, more than often, no prepared equation that could be applied to projects. Young people were looking for an equation to populate to get an answer for business. We had to change that and apply a process that would stimulate innovation and initiative when learning.
Business leaders and the entrepreneurs of the future have to be identified. In my constituency, we have pioneered an association with business employers and school leavers based on “The Apprentice”. With numerous employers, we have put in place a six-month programme called “The Recruit”, which provides vocational qualifications and involves tasks set by employers, who evaluate participants for potential hires at the end of the course; it is the longest interview a young person will have. The programme continues to be supported by many local employers, and it has been replicated by many local authorities. It has been a great success, and it regularly secures many jobs for school leavers who want to earn while they continue to learn. The course identifies and develops leaders and those with entrepreneurial abilities.
Our schools also link up with those in the third year of secondary school, offering basic skills in traditional trades that go towards an apprenticeship. The need for apprenticeships has never been greater. Too many young lives are being wasted on the dole queues. Long-term unemployed young people are the most vulnerable, with many trapped in a vicious cycle of joblessness, anxiety and depression. We desperately need to get our young people into training and apprenticeships. The 50% of our young people who do not go to university need every chance to improve their skills and to get good jobs.
David Simpson
I agree with the vast majority of the hon. Gentleman’s comments, and we certainly need to encourage our young people. However, the research papers we received for the debate state that some schools now charge parents to send their children on work experience. Surely, that is wrong, and it will not help us target areas of deprivation or encourage young people whose parents cannot afford to pay for them to go on work experience.
Mr McKenzie
I share the hon. Gentleman’s concern about charging for work experience. I represent an area whose population is not over-wealthy, and people would find it extremely difficult to pay for work experience. We are therefore fortunate that many employers offer work experience free of charge.
We need a highly skilled, highly educated work force to meet the challenges of tomorrow and to compete with other advanced nations. The economy needs value-added skills to compete with the economies of Brazil, India, China and other emerging nations. Apprenticeships are a valuable way to give young people skills, training and jobs. They also offer on-the-job learning opportunities and, of course, further education. They enable young people not only to learn about their chosen trade or profession, but to do so on the spot. They also enable them to talk to colleagues who are already skilled and experienced. Apprenticeships and vocational education can offer so much, and there is no reason why they should not be expanded to cover a wide variety of jobs and professions. If that is to happen, however, we need to engage more of Britain’s companies and to bring them on board.
We can plan for apprenticeships. Any company wanting to provide goods or services to the public should be required to have an apprenticeship scheme before it can win a contract. Labour’s jobs-for-contracts scheme would increase the number of apprenticeships by thousands and give immediate help to many of the 1 million unemployed under-25s. That simple idea—creating apprenticeship places through public procurement—would provide immediate help with alleviating youth unemployment and would strengthen the vocational sector. It works: the Labour council in Inverclyde has been using it for many years, and the number of those in the NEET category in Inverclyde stood at seven last year—not 7%, but seven pupils.
Today, Britain risks losing the global skills race. We need to be as strong as Germany and Switzerland on vocational education, and as competitive as Singapore and Japan on maths. Britain’s future national competitiveness is at stake and so is our young people’s future. We need to engage employers in designing high-quality apprenticeships, giving them a greater say in spending the £1 billion of funding available to target apprenticeships at our young people.
Stephen Lloyd (Eastbourne) (LD)
It is a privilege to serve under your chairmanship, Mr Gray. I congratulate the hon. Member for Scunthorpe (Nic Dakin) on securing the debate. His involvement with and commitment to vocational education has been long and passionate, and I share that commitment.
Tomorrow is vocational qualification day. I declare an interest as the chairman of the all-party group on further education, skills and lifelong learning. I therefore take this issue very seriously, and I have a profound commitment to it. There are many reasons why I passionately support vocational education, FE colleges and, indeed, the whole sector, but the most important is that the conversion rates from apprenticeships to jobs run at about 90%. At my local FE college, Sussex Downs, which is outstanding and has had a tremendous track record over the past few years under the leadership of its principal, Melanie Hunt, the apprenticeship conversion rate is an astonishing 92%.
A number of people who have left university with degrees and who are, sadly, still struggling to secure employment come to see me in my constituency, and I know that the same happens to other Members of Parliament. I sometimes have to resist the urge to say that if they had gone down the vocational route they would not have the student debt that so many people are, sadly, lumbered with nowadays and they would almost certainly be in employment.
On vocational education, the FE sector plays an absolutely pivotal role. There are several reasons for that. One is that the better FE and vocational colleges develop close relationships with local employers, local alternative training providers and the local DWP—the Jobcentre Plus. In Eastbourne, Sussex Downs college, where I will attend an apprenticeship event this evening before returning to Westminster tonight, is pursuing yet another initiative in a particular area of employment—in this case, retail. The college has spent a lot of time over the past year or two developing and deepening its relationships with different employer sectors and with Jobcentre Plus. A good FE sector wants to listen to employers; it talks to businesses and to the private and public sectors to try to understand their needs, so that it can train people in the vocational qualifications that fit the jobs—in other words, so that it can help people to be job ready.
My hon. Friend the Member for Harlow (Robert Halfon) has admirably championed apprenticeships since his election in 2010. I totally support—I have said this before, and I will say it again—his desire for a royal college for apprenticeships. That is a superb idea; it is exactly the kind of thing that would raise the status of apprenticeships. Perhaps we can discuss it afterwards to see how we can push it forward, because it would make a real difference.
On apprenticeship initiatives, I pay tribute to the Minister, the Government and the Secretary of State for Business, Innovation and Skills, who is probably the most passionate advocate of FE and vocational education we have ever had as a Secretary of State. I spoke to him about the issue in the main Chamber only yesterday, and he reminded me—not that he needed to—of just how important he feels vocational education is in the FE sector. He also reminded me of how important it is that colleagues who feel strongly about this issue continue to lobby the Treasury, so that it does not remove too much money from the Department.
On apprenticeships in Eastbourne, I was one of the first MPs, along with the local FE sector, to work on the 100 apprenticeships in 100 days initiative. It was essential that I developed a close relationship with my local FE college, Sussex Downs. The work, which involved us and a number of other partners, was very successful, and we achieved 181 apprentices in 100 days. More importantly, it allowed me and the FE college to open a really strong dialogue with many local employers in the private and public sectors. The success of that has been astonishing. The latest figures from the Library show that Eastbourne has recruited more than 2,100 new apprentices since the general election—more than in the previous 10 years—which shows than when things are done properly the result is tremendous success.
I want to focus on something that came out of that: it brought home to me how deskilled schools have become about pushing apprenticeships. I work closely with local secondary school heads, and they were the first to admit that because for so long—particularly under the previous Government, but, to be fair, for at least 20 years—there was a drive almost to push people into degrees, teachers had become deskilled in talking about apprenticeships and did not know anything about them. The system in the Department for Education and the school sector provides no advantages in school league tables to push people towards becoming apprentices. There are, however, advantages to A-levels and sending students to university: doing so gets more money. If I were a proactive head who wanted to educate my students towards the tremendous range of apprenticeship opportunities—let us say that I quintupled the number of people becoming apprentices—I would not get a single extra penny from the Department for Education.
Tristram Hunt
How then does it help to bring careers guidance into schools, so that there is a producer interest telling young people, even with the rising participation age, that the best thing for them to do is stay on at school, rather than pursuing vocational and other options?
Stephen Lloyd
I note that the hon. Gentleman made a similar intervention earlier, and he has a strong point: I do not see how that can help. However, that is not to say that careers services should not be in schools; the question cannot be beyond the wit of man within the DFE, because I think the Department for Business, Innovation and Skills would be keen for the careers service to be extended into FE. I do not think the solution is to stop careers guidance going into schools. I think that it is to do with the regulations and expanding the remit of careers services and the roles or opportunities that they need to talk to students about. The hon. Gentleman made a fair point.
There is a difficulty, because the issue is not one for BIS. I have spoken frequently with the Secretary of State, and several times with my hon. Friend the Minister; and it is clear to me that BIS is, considering the austerity programme, investing more, has greater commitment and is determined to continue the extension and improvement of apprenticeships and investment in FE. I think that we have now come to the tipping point with the vocational sector and FE, and the relationship with the Labour party and the Association of Colleges; there is now a profound understanding that because of the circumstances this may be a once-in-a-lifetime opportunity to move apprenticeships and vocational education up the scale, as in Germany. I am not sure that the opportunity will come again. I urge the Minister to do whatever it takes—working in partnership or working assertively with the DFE—to persuade the Secretary of State for Education to sit down with him and the Secretary of State for Business, Innovation and Skills and work on a productive, positive way forward, in which the DFE takes on board its crucial role in pushing vocational education and recognising and appreciating that there is an opportunity to transform its status, as in countries such as Germany.
Nic Dakin
The hon. Gentleman makes a clear point about the difficulty that schools and colleges face because of confused and contradictory messages. He was right to praise the messages that BIS is giving out, including those from the Skills Minister. Those are often contradicted in some of what is measured in schools, and in schools’ lack of capacity to take forward the careers education, information, advice and guidance that has been mentioned.
Stephen Lloyd
I agree with the direction of travel of those remarks. I emphasise that the problem is an old one. It has been around for 25 to 30 years, so I understand that it cannot be laid solely at the door of the current Secretary of State for Education. It has a history. However, I believe we have reached the point where there is enough collegiate agreement between all the political parties and across the whole economic spectrum to transform vocational education. Some good steps have been taken. Now is the time for us to make the leap. I urge the Minister to continue firmly in the direction of travel that he and his colleagues have taken. For BIS and the Department for Education, it is time to work together productively for a transformation that would be universally popular.
Tristram Hunt (Stoke-on-Trent Central) (Lab)
It is a pleasure to serve under your chairmanship, Mr Gray. I congratulate my hon. Friend the Member for Scunthorpe (Nic Dakin) on securing this hugely important debate, on today of all days—coronation day, when we pay tribute to our sovereign, Her Majesty the Queen. She worked in the family firm and learned her craft from a master monarch. She upskilled on the job, and now she is involved in her own training programme. Perhaps in future we may move vocational qualification day to coronation day, to give exactly the sort of royal imprimatur that the hon. Member for Harlow (Robert Halfon) spoke so eloquently about.
My hon. Friend the Member for Scunthorpe was a long-serving principal of a sixth form college and is better placed than many of us to comment on the challenges that we face in creating an outstanding vocational education system. He set out the issues with authority and passion, and I pay tribute to his work at the Humber Skills Commission. Amazingly, he did all that while restricted by the anaconda of the omertà of the Whips Office, the perennial purdah that he suffers. Yet he still pursues his case with passion and authority. Furthermore, like me he represents an area that is on the front line of the Government’s austerity assault. One hopes that he has benefited from the recent changes in the climate change levy, but the truth is that for cities such as Stoke-on-Trent and places such as Scunthorpe, at the sharp end of the historic process of deindustrialisation, the profound brilliance of our local craftsmanship and artisanal skills has not insulated us from some challenging economic conditions. We can have brilliant craftsmanship while the situation for local skill levels is particularly challenging.
Now is not the time for a debate on the Government’s disastrous economic policies and the damage they have done to the demand side of the equation. We are gathered here today because we know that the supply side of the employment debate matters too: educational attainment and skills capacity are a vital component of rebalancing our economy to a more sustainable model. That much should be abundantly clear to all. Yet it should also be clear, as hon. Members of all parties have agreed, that we are nowhere near where we need to be on skills. Indeed, our weakness was illustrated in a recent global survey of over 1,300 chief executives by PricewaterhouseCoopers. That report revealed that UK business leaders are the most concerned in the whole of western Europe about the availability of key skills. Indeed, they rated it as the greatest threat to their businesses’ growth and three quarters of them said, rightly, that creating a highly skilled work force should be the highest priority for Government in the year ahead.
Sadly, however, there is still some complacency in Government, which, as my hon. Friend the Member for Inverclyde (Mr McKenzie) pointed out so brilliantly, is profoundly damaging to our international competitiveness, because we are, as the Government like to tell us, in a “global race”. How can we succeed in that race when we languish 21st out of all OECD countries in intermediate technical skills and while 31% of high-tech manufacturing firms have been forced to import labour from outside the UK because of a skills shortage? In this very Chamber, we recently had an excellent debate on engineering and the threat to parts of the national security supply chain because of the lack of UK-only trained engineers, particularly female engineers, as some hon. Members have suggested.
The Government, as the latest edition of The Economist eloquently puts it, are racing with their “shoelaces tied together”. That is why this debate is so important. It is absolutely clear to the Labour party that, if we are to build what we want to see—a one nation economy that can compete in a globalised economy while raising living standards right across the regions and nations of the United Kingdom—we simply must have the best skilled work force in the world. The cornerstone to delivering that must, now and in the future, be a relentless focus on driving up the standards of our vocational and technical education system.
I think it is fair to say that, as many hon. Members have noted, not least the hon. Member for Eastbourne (Stephen Lloyd), successive Governments, including the last Labour Government, have not done enough to help the 50% of young people who do not want to pursue the academic route at 16 or 18. As he suggested, we are at a moment of agreement across the parties on the need to rebalance the debate, but I introduce a note of caution. We still want young working-class kids from Stoke-on-Trent, Scunthorpe, Eastbourne and Inverclyde to be able to go to university, and we should not be in the business of precluding those avenues. Although we can rebalance the debate, and although we all want to see growth in the respect given to vocational education and apprenticeships, we must not go down the avenue of suggesting that young working-class kids should not go to university.
Stephen Lloyd
I entirely agree with the hon. Gentleman, but does he agree that what we are seeking is parity of both respect and esteem?
Tristram Hunt
I am delighted to agree with the hon. Gentleman. He is absolutely right. What we are interested in is a cast-iron commitment to academic and vocational parity, because although our focus in government on raising school standards and academic rigour, and on expanding our outstanding, world-beating higher education sector, left the education system in far better shape than we inherited, as my hon. Friend the Member for Scunthorpe said, we could have done more on vocational education. That is why the Labour party has placed vocational education not just at the heart of our education agenda but at the heart of our offer for the country in 2015, and it is why the leader of the Labour party made his call for focus on that forgotten 50% the heart of his recent party conference speech.
We disagree on the way the Government have pursued vocational education, however. Since they came to power, the Government have undermined careers guidance, which is a big issue for vocational routes. The recent report on that by the Select Committee on Education was absolutely damning. The Government have scrapped work experience and downgraded successful vocational qualifications such as the engineering diploma.
The Government have also made some bad mistakes on apprentices. When they came into power, they simply moved many of those on Train to Gain to apprenticeships. They were more interested in quantity than quality. We would like to think that there has been some rowing back on that recently, and we welcome the Richard review and all the hard work that the Minister is doing to try to enlighten the Secretary of State for Education on that, and we fully support him.
The Minister may now have persuaded his colleagues to hurry out their own version of a tech bacc, yet the difference between the Government’s technical baccalaureate and the Labour party’s original ur-version is that theirs is a performance measure whereas our ambition is for it to be a qualification that we want people to achieve. If some people are going to achieve it, other people are going to fail. If we want quality, it means some will succeed and some will not succeed. We want differentiation on the quality achieved.
As part of that, we need to raise the profile and status of vocational education to create a dual-track system that, as the hon. Member for Eastbourne suggested, genuinely gives no preference to either route. On vocational standards, that means having a clear line of sight both to work and to advanced, further or higher education, which means creating flexible and permeable pathways as a matter of importance. After all, young people are rightly wary of narrowing their options, and the whole ethos of a baccalaureate is to have a sense of broadness. Many see the option of gaining a degree or a gold-standard vocational qualification as part of their natural progression, irrespective of the route they choose at 18.
Furthermore, creating a genuine dual-track system also relies heavily on a deep-seated, collaborative ethos between institutions in delivering education and training. The countries that have enjoyed success in raising standards, such as Austria, Finland and Germany, all benefit from a system that has not only great career guidance but clearly defined roles for key stakeholders, with a great amount of time divested to building and maintaining institutional relationships.
If there is another criticism of the Government’s education policy, it is whether we are seeing the right degree of collaboration between atomistic, competitive schools, which are raising standards in certain situations but are not necessarily providing the kind of collaborative ethos that a local skills economy might need. That is some way from the institutional culture that the Government seem intent on inculcating with their slightly high-handed approach to the expertise of teachers and professionals, the lack of business involvement in delivering training and their focus on competition as the only measure of improving performance. If we want a proper industrial strategy, as the Secretary of State for Business, Innovation and Skills keeps urging, we need smarter local and regional collaboration.
Indeed, we only have to look at the shambolic execution of the Government’s careers guidance policy for a textbook display of encouraging perverse institutional incentives. In a tough funding climate, it will be a brave and outstanding school that advises its pupils not to stay on. In a recent conference in Westminster, we saw a very good example of that: a leading academy school that is part of a leading chain said that it had brought in outside careers guidance, exactly as it should be doing, but that it told the person coming in to give the careers guidance that they were not allowed to advise pupils to go to the college up the road. With in-house careers guidance, there is a producer interest in keeping kids along an easily understandable gold-path academic route, as it were, of GCSEs, A-level and university, rather than thinking far more creatively, which requires trained professionals with knowledge of local situations.
Perhaps the biggest problem we face in delivering a vocational education system for the future is the perverse and pervasive disconnect between the education system and local labour markets. All too often, skills policy is isolated from industrial and economic policy. That is why Labour’s technical baccalaureate would directly involve businesses in accrediting the quality of courses, and it is also why our tech bacc, unlike the Government’s tech bacc, would have a work experience requirement. Businesses have told our taskforce, the Husbands review, that that is absolutely crucial, which is why we would ensure that all vocational teachers spend time every year with local businesses and industry to keep their skills and experience fresh.
Those three measures would bring to education and training institutions a clear and realistic understanding of local labour markets. Closing the gap between employers and educators is vital if we are to develop a dual-track approach.
Of course, raising educational standards in vocational training does not mean that we weaken our focus on core subjects and on improving rigour. In vocational or academic routes, there should be no false division between theoretical knowledge in practical subjects. There is an interesting discussion to be had on where the journey begins for opening up pathways at 14 or 16. What have we learnt from the university technical colleges on the 14-to-19 parameter, rather than up to 16? Was the Wolf report 100% correct in saying that people should continue with the same totality of focus up to 16?
Fundamental to the Labour party’s education policy is a clear commitment to teaching English and maths to 18, irrespective of route, because although many further education teachers do an outstanding job, often in challenging circumstances—we have heard about the differences in funding and free school meals—we need to raise teaching standards in FE colleges in English and maths. Of the 40% of pupils who do not get a level 2 qualification at 16, only 20% go on to acquire one at 19 through the FE system. That needs to change if we want to upskill our country. The Minister should once again take his cue from Labour’s policy review, which is open and available to him, and from our one nation skills commission’s interim report, and commit to requiring all FE teachers to have at least a level 2 qualification in English or maths.
There are other problems with our system of vocational education, training and skills. We have acute skills shortages in crucial sectors such as engineering, too many young people who lack employment skills, low levels of employer involvement and a lack of good-quality advice for navigating the transition to work. Labour supports the proposals on traineeships that the Government are beginning to carve out. There is also a dearth of high-quality apprenticeships and a damaging divide between vocational and academic pathways.
However, I remain deeply optimistic about our ability to deliver on creating the skilled work force that we need. If we have problems with the manner of delivery, it is heartening that we have an element of cross-party consensus on the issue. We have a vast supply of dedicated, skilled, quality teachers who are willing to work with us to raise standards. If we get the system right, we can reverse the long tale of poor skills in this country and deliver a work force that can compete with the world.
We agree with the Secretary of State for Business, Innovation and Skills that there is no future in a zero-sum game of depressed wages and longer hours. That is the Conservative future outlined in the terrible book “Britannia Unchained”—I do not know whether the hon. Members for Harlow or for Suffolk Coastal (Dr Coffey) contributed a chapter—which depicted a grisly neo-liberal world in which the British are too lazy and too slow. I do not know whether that includes paternity leave; the Minister might be able to enlighten us later.
The solution to our competitive challenge is not a low-skill, low-wage economy or a divided education system—the only race that will win is the race to the bottom. Rather, we must and can compete on our own terms, which means using our competitive advantage in innovation to build a one nation economy based on high-level skills and dynamic, technologically sophisticated companies. That is what young people want, it is what businesses want and it is what the Labour party is committed to delivering. It starts with a dual-track education system and our rigorous technical baccalaureate.
Robert Halfon
On a point of order, Mr Gray. For the record, I did not contribute to the book mentioned by the hon. Gentleman.
The Parliamentary Under-Secretary of State for Skills (Matthew Hancock)
It is a great pleasure to serve yet again under your chairmanship, Mr Gray. It is a partnership that I hope will continue for a long time to come. This debate is extremely important and timely. I pay tribute to the hon. Member for Scunthorpe (Nic Dakin) for securing it today, the day before vocational qualifications day, which was set up to celebrate vocational qualifications in a similar way to results days for GCSEs and A-levels. It is part of the twin track discussed by the hon. Member for Stoke-on-Trent Central (Tristram Hunt).
The debate has been wide-ranging—it is typical to say so at the start of a winding-up speech, but it is also true—and important. Some valuable points have been made on both the detail and the big picture. The hon. Member for Scunthorpe began by discussing four areas of concern: vocational education at key stages 4 and 5, careers advice, apprenticeships and traineeships and adult skills and unemployment. I will try to answer all his questions in the time available.
The hon. Gentleman also set out a rather Panglossian view of the world in 2010, not mentioning that youth unemployment was rising even before the crisis and had reached 1 million. Thankfully, it is now falling, although it is still far too high. There were skills shortages at the same time, which says to me that the education system has not been producing the skills that businesses need. I was rather more encouraged by the hon. Member for Stoke-on-Trent Central, who took that argument apart and made a passionate case for increased standards. He was willing to criticise the previous Labour Government, rightly, for not focusing enough on standards in vocational education.
To address a point made by my hon. Friend the Member for Eastbourne (Stephen Lloyd), I sit in two Departments. In the Department for Education, the action taken to increase standards in vocational education came first. Since the Wolf report, commissioned in 2011, we have taken action in the 14-to-16 age group, and we have now finalised a consultation on improving the quality of qualifications for 16 to 19-year olds. The area was radically in need of reform, and radical reform is coming through.
The devotion to increasing standards in vocational education—which has cross-party support, including clear agreement that there was a significant problem in 2010—has been led by my right hon. Friend the Secretary of State for Education, with the strong support of my right hon. Friend the Secretary of State for Business, Innovation and Skills. All three major parties agree on the matter. I think that we can now all accept that a serious weakness needed to be addressed and that we are taking steps to address it.
I say to all involved in this debate that, given that we will the ends, we must also will the means. That involves clearly, carefully and in a spirit of high consultation going through the qualifications offered, funded and recognised and ensuring that we support high-quality, stretching, rigorous qualifications that are responsive to the needs of employers.
On the point about the engineering diploma, we must encourage the creation of stretching, high quality new qualifications that fit the needs of modern employers. We encourage their creation in areas needed by business, and that has begun in the engineering industry and across different economic sectors.
This has been a helpful debate on both detail, to which I will come, and the big picture. As the hon. Member for Stoke-on-Trent Central said, of the 40% who do not get a level 2 qualification in English and maths, only 20% get one by the age of 19. That situation cannot be allowed to continue. I have read the Labour plan to increase English and maths requirements for FE teachers. That is already happening; I will send him the details of what we have done to address the issue. That is hopefully another outbreak of consensus.
In setting out what we are doing to achieve those goals, I will answer the questions put. Satisfyingly, the questions put were already answered in the draft of my speech, which is always good news. Professor Wolf found in her report, commissioned in 2011, that as many as 350,000 students were being funded to study for qualifications that they could pass but that were too small or low-level to get them a job. We are changing the requirements for qualifications to be funded and recognised, but we are doing so alongside changing how we fund all education between the ages of 16 and 19.
From September, funding will be on a per-student, not a per-qualification, basis, removing the unintended and perverse incentive to offer more qualifications, rather than focusing on what individuals need. Pupils will be offered a study programme including either a substantial vocational or academic qualification or an extended programme of work experience.
I return to the point about work experience, which is part of the study programme. This will give schools, colleges and training providers the flexibility to offer the most challenging qualifications to students who want to excel, whether in a technical field, in practical, employment-based training such as an apprenticeship or in an academic field. The need to ensure that people have a choice to pursue technical or vocational education, academic education or a combination of the two is important, and the Government’s job is to provide excellent options in all of those fields. I was delighted that Her Majesty said in the Queen’s Speech that it should become typical for young people to go either to university or into an apprenticeship. Our job is to ensure that excellent options are available on both sides, and not to have a target that falsely pushes people one way or the other.
My hon. Friend the Member for Harlow (Robert Halfon) argued that vocational education is social justice. The change in the funding system means that all students will be funded at the same base level, once the transitional protections are past. Instead of the average person who goes to an FE college being funded less than the average person who stays on at sixth form, because of the different amounts of funding awarded per qualification, everyone will be funded per pupil, on the same basis, with factors allowing for location, background and the higher cost of some qualifications.
Nic Dakin
The Minister is making a good point, but the plan is for 16 to 18-year-olds to be funded significantly less than students younger than that or than students who go on to higher education. There is an issue about the quantum, which I hope that the Government are examining.
Matthew Hancock
I do not quite take the point on higher education, because students in higher education fund themselves through loans. I am pleased that through our introduction of loans and the progressive rules on repayment—only if people have a good job and earn £21,000—a record number of people are applying to university, and that also provides the hon. Gentleman with a response to an intervention that he made. To make the right comparison on how much we fund someone in an age group, we need to ensure that in the first instance the funding is equal across the different sectors and options, which is what the change will achieve.
I pay tribute in the strongest possible terms to my hon. Friend the Member for Harlow on the parliamentary apprenticeship scheme, which he set up and champions. I support him for doing that, and now dozens of MPs and peers have apprentices. Knowing the impact that apprentices have on employers—they become much more passionate about apprentices when they have apprentices themselves—I am sure that the scheme will have an effect on MPs. Indeed, it was a great pleasure to take the parliamentary apprentices of all parties to No. 10 Downing street to meet the Prime Minister, and I enjoyed grinning with the apprentice of the hon. Member for Scunthorpe on the steps of No. 10.
An important point to make is about the participation age rising from 16 to 17—for those starting this year—and then to 18. The participation age will ensure and require that young people stay in education or training until, by 2015, they are 18, although not necessarily in school—it could be in college, in an apprenticeship, in employment with training or in voluntary work with part-time training. That is an important point because we do not want to close down the options available, but we want people to stay in education. An apprenticeship is a good way to deliver that.
Why are we making the reforms, which fall under the title of increasing rigour and responsiveness to the needs of individuals and of employers? What I call the motivating fact is the link between having youth unemployment that is far too high and skills shortages. To deal with that, it is important to ensure that the education system is more responsive and more rigorous and stretching.
How are we going to achieve that? I will go through some of the measures, four of which form the core goals that I think are necessary and the first of which is the introduction of traineeships. Many young people are highly motivated by the prospect of work, but are not yet ready or able to secure an apprenticeship or sustainable job. From this August, therefore, we are launching a high-quality traineeship programme within the study programme for 16 to 19-year-olds, to include work preparation, work experience, and English and maths, because English and maths are the No. 1 and No. 2 vocational skills. Other flexible training will be tailored to meet individual need.
Nic Dakin
The introduction of traineeships is positive, but my understanding is that they will be about six months in length. Will the Minister consider being flexible on how they are delivered, so that they could be delivered in a longitudinal way alongside other qualifications over a year, for example?
Matthew Hancock
The plan is to introduce the traineeships this year and to have a full analysis of how they work over their first year of operation. I am willing to look at all questions, because the preparation for the traineeships has been highly evidence-based and consultative. Over the years, we have had many different programmes to help people who are not yet ready to take on a job, and some have been successful and some not. My Twitter account is full of descriptions of experiences of YTS—the youth training scheme—or the flexible new deal, for example, and all sorts of different Government schemes that have been in this space. We want to ensure that we learn where they have worked and where they have not.
The second big change is in apprenticeships, and I am delighted with the cross-party support for the Richard review. The number of apprenticeships has almost doubled since 2010 and, we found out last week, apprenticeship applications are up a third on the previous year. The new higher apprenticeships allow people to get into the law through an apprenticeship and to become a fully qualified solicitor, or, likewise, into the upper reaches of the worlds of engineering and manufacturing and even to become an accountant. People will get the same qualifications as those who go through university.
Steve Rotheram (Liverpool, Walton) (Lab)
As a former apprentice, I understand the value of apprenticeships, but what are often described as apprenticeships by some Government Members are nine-week training courses. We have to protect the quality of apprenticeships.
Matthew Hancock
Yes, and we have introduced a minimum period of a year for apprenticeships. We absolutely have to do more on quality, which is what the Richard review is all about. We have introduced UTCs—university technical colleges—which will introduce the very best technical education in conjunction with universities and employers. We are reforming qualifications and standards, because we cannot will the end—higher standards—without willing the means. When colleges fail on minimum standards, whether financially or educationally, the new FE commissioner will take a tough approach when looking at all the options for how to serve local students better.
Finally, on careers advice and guidance, we want better inspiration and motivation, character building and the opening of young people’s eyes to wider horizons, with mentoring so that everyone can reach their potential. The information is out there—the web is littered with it—but we need to ensure that young people find it, know what is relevant to them and can set and reach their goals. Ofsted is inspecting against the new duty to provide independent and impartial advice, so schools will be inspected for that. Crucially, the new destination data will show not only how many people go to university, but how many go into an apprenticeship or a job. The data will better hold schools to account for the outcomes of the education that they provide, not only on the exams and where they get in those league tables, but on where the students get to. I hope that that improves matters a lot.
House of Memories Programme
(10 years, 11 months ago)
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Steve Rotheram (Liverpool, Walton) (Lab)
It is a pleasure, Mr Gray, to serve under your chairmanship, and to have the opportunity to discuss such an important issue so soon after the debate of the right hon. Member for Sutton and Cheam (Paul Burstow) before the recess, although on that occasion it was discussed in a wider context. I want to explain why I chose to apply for a debate so soon after several debates about mental health conditions, including dementia and Alzheimer’s, in the main Chamber, which rightly highlighted the effects of such diseases and their impact on patients, families, carers, social services and the NHS. A benefit of parliamentarians debating such issues is that it helps practitioners in their determination to debunk the myths of Alzheimer’s and all forms of mental health conditions, and to alleviate their stigma. I make no apology for bringing the topic to the House’s attention again.
Colleagues will be aware that tremendous progress has been made in treatment to combat dementia-type illnesses with both clinical and non-pharmaceutical interventions that help to care for the condition or slow its onset. I want to use the time available not to rehearse what has been said about that previously, but to develop some of the details relating to an initiative that I first brought to the House’s attention during my contribution to a debate on 10 January 2012.
The innovative approach I mentioned then was the House of Memories project in Liverpool. There was interest from right hon. and hon. Members when I explained the benefits of that approach, and the project has merits that could easily be rolled out throughout the country. The best thing—the Minister will be pleased to know this—is that it would not cost the earth. Instead, it would undoubtedly save the NHS millions of pounds in the long term. I will give a brief overview of the project before coming to the crux of why I was so keen for the Minister to come to the Chamber today.
National Museums Liverpool has developed a sustainable partnership with care providers through a connection to local histories, objects and archives at the world-class Museum of Liverpool. The House of Memories project is described by experts as a
“tailored dementia…training programme, which uses artistic interpretation, curatorship,”
museum education
“and reminiscence therapy techniques to raise awareness of the condition, and enable professional health services, carers and families to help those directly affected live well with dementia.”
The project demonstrates how a museum or, by association, a library, arts centre or theatre can provide the health and social care sector with practical skills and knowledge to facilitate access to an untapped cultural resource simply by using their local treasures and art work. Such work is vital when considering that mental health issues in elderly people will not go away. In 2010, more than 700,000 people living in England were diagnosed with progressive symptoms, including loss of memory, mood changes and problems with communication and reasoning. Such symptoms occur when the brain is affected by certain diseases, including Alzheimer’s, and by damage caused by a series of transient ischaemic attacks, or mini-strokes as they are known. A staggering 21 million people in the UK are estimated to know someone with dementia, and one in three people aged over 65 will have dementia by the time they reach the end of their life. More than 86,000 people in the north-west alone are currently diagnosed with the condition.
National Museums Liverpool has recognised that museums are experts at recording and caring for people’s memories and treasures, whether they are thousands of years old or within living memory. A net result of the project has been the way in which the House of Memories project has encouraged the medical profession to consider new approaches and alternatives to established practices and therapies. We know that health care and medicine are evolving, but in Liverpool we have found that some of the components to assist patients’ well-being have been under our nose all along.
Developing new strategies is not easy, and the first phase of the project, which was funded by the Department of Health in 2011, was designed in consultation with Skills for Care, the Alzheimer’s Society and the local voluntary sector. Together, the partners informed a real-world training experience to connect the care sector with National Museums Liverpool’s cultural resources. The House of Memories project has not only achieved a high level of attendance from across the wider health sector but sustained that engagement.
The outgoing Liverpool primary care trust identified that the project met and exceeded the need to make Liverpool a city that supports greater health and well-being for all residents. More recently, Liverpool city council has recognised the project as a key driver of its age-friendly city ambition, and the Department of Health has expressed interest in expanding the project across southern regions. That demonstrates the thoroughness of the model. Not only have National Museums Liverpool’s staff dedicated much time and energy to ensuring that the health and social care side of the model is catered for, but it has a strong business model that stands as a leading example for other cities and towns to follow on a larger or smaller scale to suit their needs.
The current project was delivered in the Liverpool city region, Manchester and the north-east, including Newcastle and Sunderland. To date, more than 3,000 health and social care professionals have participated, and I see no reason why Parliament should not give a commitment today to an ambitious target for the number of health and social care professionals exposed to this leading training to increase exponentially in the next few years. I would welcome an opportunity to work with the Minister to facilitate that eventuality.
External evaluation of the House of Memories project makes impressive reading, and the feedback is available for hon. Members to view on its website. If the Minister has not had an opportunity to read it, it would be good if he did so. The feedback was overwhelmingly positive and noted that the project increased awareness and understanding of dementia, and helped participants better to understand those living with the condition in a way conventional training has not been able to do to date.
I hope that I have demonstrated that in Liverpool we have begun the process of changing the culture of how we view those living with dementia, but there is more to do, and it is vital that the Minister recognises the economic impact that such projects have on NHS finances. Early intervention and targeted treatment that uses local resources have the potential to save the NHS millions of pounds. Instead of dealing with the condition in its latter stages, which is not only expensive but heartbreaking for patients and carers, we should ensure that any prevention or delay in its development is made a priority, and that those left to treat the condition are afforded appropriate training to deal better with its effects.
The British museum sector holds great collections of arts, artefacts and archives, as we would expect, but people would perhaps not normally associate it with playing an important role in the dementia arena—that is, until now, hopefully. There are other models to study: for instance, the Museum of Modern Art in New York runs an internationally acknowledged programme, where gallery staff engage with individuals living with dementia and their partners and families in conversations about modern art. However, the House of Memories project is qualitatively different from MOMA’s programme. It provides guidance for engaging people living with dementia and their carers in the museum experience, supporting that with a toolkit and resources such as a memory box.
One of the great success stories has been National Museums Liverpool’s ability to position House of Memories as a credible and important tool for dementia awareness, as its greatest challenge was to gain acceptance and support from the health sector by developing a learning tool that would be accessible, both creatively and intellectually, while acknowledging the real-world challenge of supporting people to live well with dementia. No one can be in any doubt that NML has been totally successful in achieving that ambitious recognition. One way that I and my fellow Merseyside MPs can ensure that the partnership keeps making progress is by continuing to raise awareness and by ensuring that the relevant Minister is constantly updated with the continued success of the House of Memories’ innovative work. I will, of course, ensure that I do so.
I am pleased to report that the project continues to receive a positive regional response and has secured additional health sector funding until 2015, which will include the development of an online digital tool for carers and families. I urge the Minister to outline what further support he can offer to the development of that capability. I am sure that Members of all parties will recognise and appreciate the innovative work of the staff at the Museum of Liverpool, and I should like to take the opportunity to praise each and every one of them. It should be noted that the Museum has also recorded an increase in visits from care home staff and patients. Cultural partners, such as Riverside housing, have taken inspiration from the training by developing personalised, culturally sensitive memory boxes for the Chinese and Afro-Caribbean communities, which exemplifies the social value of greater dementia awareness for the whole of Merseyside.
We are not talking about brain surgery; the concept is simple. I went to the museum to look at one of the sessions, and because it was in Liverpool, a lot of people were interested in football, of course, and music and comedy. The memory box, therefore, has such things as football programmes from Liverpool or Everton football clubs, ration books, some old tunes and records, and old theatre programmes, and those stimulate conversation with people. The long-term memory of most sufferers is very good. Short-term recollection is a problem for many, but those props really get people into conversations and act as a prompt for all sorts of detailed discussions, and—it must be said—for friendly banter from people who find it very difficult at times just to have an ordinary conversation. Liverpool’s aim is to make the project fully available across the constituencies of right hon. and hon. Members.
National Museums Liverpool would like to work in partnership with the Department for Culture, Media and Sport and the Department of Health to lead the development of a house of memories resource in every town and city across the United Kingdom. That would create an opportunity for greater co-operation between Whitehall Departments and it would provide continued cultural innovation for health and social care, hospital and social housing settings. That is vital when we consider that all Departments and partners have been widely encouraged to support the Prime Minister’s national dementia challenge.
I ask the Minister to allow the professionals with a track record of success in Liverpool to help him implement similar projects across the country. Given the positive response from the health sector, I believe that if the Minister commits today to sustaining the ongoing work further with logistical support and funding, National Museums Liverpool will deliver significant outcomes and opportunities for a sustainable cultural and health sector partnership in communities across Britain. I do not doubt that in other parts of the country, the cultural sector is making strides towards improving the relationship between the arts and dementia treatment. However, I have yet to see a more comprehensive project, with a greater level of success, than Liverpool’s House of Memories. In other words, NML has set the national standard, and it has set the bar very high.
I wish to conclude by asking the Minister the following questions, which I would be grateful if he could address either in the time we have left today, or, for those that he cannot, in writing afterwards. Will he inform Members what discussions he has had with the Chancellor of the Exchequer and the Under-Secretary of State for Culture, Media and Sport over the potential long-term economic benefits of supporting the House of Memories? If he is yet to have those discussions, will he commit to doing so this side of the spending review? Will he indicate whether his Department will support the House of Memories project further in 2013-14 and onwards? Will he meet Dr David Fleming, the director of National Museums Liverpool, and me at the Museum of Liverpool to discuss the work that we are doing on Merseyside, and to witness first-hand the positive impact that it is having on dementia patients in our city?
The Minister of State, Department of Health (Norman Lamb)
I congratulate the hon. Member for Liverpool, Walton (Steve Rotheram) on securing the debate. I remember his speech in the Chamber during the debate he referred to earlier. He talked passionately about the House of Memories initiative in Liverpool, and I think I am right in saying that he also spoke about his mother’s battle with dementia, so I know he cares a lot about this issue. I am keen to work with him and to talk to him further about how we can maximise the benefits of such an approach.
I should also refer to another institution in Liverpool—Everton football club. I am not sure where his loyalties lie in that great city, but Everton have done great work on reminiscences and dementia. I have had people from Everton come to the Department, together with other representatives of football and sport. The hon. Gentleman talked about long-term memory and the power of reminiscence, and sporting memories can be incredibly valuable in bringing people back who are suffering from dementia. I am absolutely with him on that.
Steve Rotheram
I thank the Minister for giving way, and for mentioning Everton football club and the Everton in the Community project. During my visit to the museum, Everton were represented, and they had their football reminiscence material there. It does exactly what the Minister has outlined, and stimulates conversation like nothing else because of people’s memories of great moments in their lives. Some of those will obviously be sporting-related, and that could be part of what the House of Memories project is about.
Norman Lamb
I am grateful for that intervention. I have been asked to give my own footballing memory, and it is Jeremy Goss scoring a fantastic goal away at Bayern Munich. Norwich City were for a long time the only club that had beaten Bayern Munich away. I am looking to see whether we can extend the work of Everton to other premier league and football league clubs, because they have a powerful position in their communities and can be opinion leaders in developing these ideas powerfully in their communities.
I am wholly supportive of the House of Memories. It is an exceptional project that has been funded in part, as the hon. Gentleman said, by the Department of Health; more than £220,000 has been allocated during the last two years. As we have heard today, National Museums Liverpool provides an innovative training programme that is making a real difference for social care staff by helping them to connect with the people with dementia whom they support every day. They use the objects that the hon. Gentleman referred to and the stories linked to the museums’ collections. Museums across the country have a rich collection of objects and art that can be so powerful in helping people to live well with dementia. It is a very powerful partnership with care providers. I think the hon. Gentleman said that 3,000 care workers had already participated. That demonstrates the reach of this project. It is fantastic that the cultural sector is involved in work on dementia; it is a great collaboration. Getting the medical profession to consider new and different approaches beyond pure medicine can be very powerful. The work to which I have referred is critically important in supporting our drive to create more dementia-friendly communities.
The hon. Gentleman is right about the value of early intervention and the savings that can be secured for the NHS in this way. My understanding is that the money from the Department of Health has already helped to roll out this approach to museums across the north of England. There is a funding application in at the moment for 2013-14. That is being considered by the dementia work force advisory group. It could extend the roll-out to museums and galleries in the midlands. I think the decision on that will be communicated to National Museums Liverpool over the summer. Obviously, I cannot pre-empt the outcome of that application, but clearly, as I have said, I am wholly supportive of this project and keen to work closely with the people involved to develop this initiative and concept further.
There are 670,000 people in England with dementia. That number is increasing year on year, as is the £19 billion cost to society of dementia. Faced with that, the Prime Minister launched in March last year the challenge to which the hon. Gentleman referred, which builds on the dementia strategy the Labour Government initiated in, I think, 2009. It is a powerful and good initiative and was one of the first globally to be developed. This condition is the biggest fear for people over the age of 55—as someone who has just turned 55, I am acutely aware of that.
A year on from the launch of the Prime Minister’s challenge, dementia remains a priority for the coalition Government, for their partners in health and care and for me personally. The House of Memories was I believe referred to in the updated report on the Prime Minister’s challenge last November, so its effect has been recognised. In the first year, we have achieved a lot, not only laying the foundations for delivery but making progress across all three areas of the challenge: first, improving health and care services for people with dementia; secondly, creating more dementia-friendly communities, where this work can play such a valuable role; and thirdly, the importance of research and committing more resources to research into finding cures and prevention mechanisms for dementia. That is creating a momentum that will lead to real improvements in the lives of people with dementia and their carers.
For the first time, there is a quantified ambition to increase the diagnosis rate for dementia from the current 45%, which is far too low. Our aim is that by 2015 two thirds of people with dementia should have a diagnosis, with appropriate post-diagnosis support. We are also seeing real action on the creation of dementia-friendly communities, with 50 areas expressing an interest in becoming dementia friendly. An awful lot is going on in Liverpool, and I do not know whether the city as a whole is exploring that, but clearly there is good leadership in that city.
The launch of the Dementia Friends initiative has already captured the imagination of thousands of people, and the number of people attending the awareness sessions is growing every week. I participated in a session in Warwick in April, so I have become a dementia friend—I have the badge to show it. If the hon. Gentleman has not done that yet, I encourage him to do so and, indeed, I encourage others to take up that challenge locally.
The UK will use its presidency of the G8 to identify and agree a new international approach on dementia research. A specific G8 dementia summit will be held in London in the autumn. It will bring together Health and Science Ministers alongside world-leading experts, senior industry figures and the Organisation for Economic Co-operation and Development. The event will look to secure more co-ordination and collaboration on dementia globally. I suspect that initiatives such as the one from Liverpool could play a part internationally, through this G8 process, in teaching other countries about what could be learned from them.
A skilled work force is vital to delivering compassionate care for people with dementia. That is why we are taking forward work to ensure that we have front-line staff who are capable and competent in dementia care. The Department of Health and NHS England are working closely with Health Education England to put in place a forward work programme for the delivery of the work on dementia set out in their mandate. That includes ensuring that 100,000 NHS staff have undertaken foundation-level training on dementia by March 2014, so that they can better support people with the condition. A new e-learning package has been published that will lead to 100,000 nurses and health care assistants receiving dementia training via e-learning by 2015.
In March, the Department launched a new nursing vision and strategy for dementia care that sets out what is expected of all nurses in order to meet the level and quality of care expected in all settings. In social care, the dementia pledge builds on the care and support compact by supporting social care employers to develop their work force’s understanding of dementia and to adapt their services to meet the needs of people with dementia. More than 900 care providers have already signed up to the pledge and almost 150 to the compact.
The hon. Gentleman asked one or two questions at the end of his contribution. In the spending review discussions, the focus on and the priority that the Government give to dementia will remain central to our thoughts in ensuring sufficient funding to maintain the momentum we are starting to build. As I said, in this Parliament we are building on the last Government’s strategy through the Prime Minister’s challenge.
I confirm again my absolute support for the House of Memories initiative. I want to maintain the liaison and collaboration that has been developed in the last year or so. The hon. Gentleman mentioned the possibility of meeting in Liverpool, which I would love to do if time allows. My diary is a complete nightmare, but if it is possible I will be very happy to do that. I certainly want to do all I can to ensure that the valuable lessons learned from this exciting and imaginative initiative, bringing together two sectors, are learned elsewhere, so that people with dementia really benefit from it.
Science and Research
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Dr Julian Huppert (Cambridge) (LD)
It is a pleasure to serve under your chairmanship, Mr Caton. It is good to see the key people here for the debate—the Minister for Universities and Science, my right hon. Friend the Member for Havant (Mr Willetts) and the hon. Member for Birmingham, Ladywood (Shabana Mahmood). The three of us were supposed to meet a few weeks ago for a debate under the auspices of the Campaign for Science and Engineering, which was cancelled, so it is nice that we can recreate it here in slightly more elegant surroundings and with a wonderful audience. It is good to have the Minister and hon. Lady here.
With the spending review considerations imminent, when decisions will be made that will affect the future of science and research for many years to come, this debate is especially timely. The theme of the debate is based on a paper I published last year called, “Developing a future: Policies for science and research”, which is available online for anyone who wants to see the whole thing, at www.TinyURL.com/scipol. I would like to place on record my thanks to those who helped, particularly Michelle Brook, who was critically involved in writing much of it. It was passed by the Liberal Democrat conference and large elements of it are now Liberal Democrat policy—things we want to achieve—but I do not want the debate to become a party political session. We are all used to the debates where we all say, “The last Government did this and this Government did that”, and it does not take us any further. I hope that the Minister, the hon. Lady and I, in particular, can work together to support science, because science works across parties.
There have been good Ministers for science from various parties: Lord Sainsbury, now the chancellor of Cambridge university, in my constituency, was an excellent science Minister; the current Minister is an excellent science Minister; and my right hon. Friend the Secretary of State for Business, Innovation and Skills has done a huge amount for science and is now a regular visitor to Cambridge to see what happens there. None of that means that I necessarily agree with everything that every science Minister says, but having the right push and trajectory is important. Although I will often use the term “science”, I want to make it clear that I do not mean just pure science. It is not only about the natural sciences. The humanities have a critical role, as do computing, engineering, mathematics and medicine—everything. An opposition between science and the humanities and arts subjects, has occasionally been suggested, but that is a false dichotomy that takes us nowhere positive.
I declare an interest, which is registered in the Register of Members’ Financial Interests: before coming to this place I was a research scientist; I am on leave from a lectureship I hold at Cambridge university; and I am involved in a number of learned societies and science organisations. I am even an honorary associate of the British Veterinary Association—as long as they never ask me to do anything with animals. I have an interest, in those senses, which I am happy to declare.
I also have a constituency interest, because high-technology is key to the success of Cambridge. We now have more than 1,500 companies, 54,000 jobs and £12 billion in revenue from the high-tech, knowledge-based economy in Cambridge. The details of the companies are made available by the wonderful Sherry Coutu on the Cambridge cluster map, where we can see details of every one of those companies—the £12 billion—that we have built in Cambridge on the knowledge economy. We can also see the $20 billion company that we have built up—ARM, a huge powerhouse, developing superconducting chips. People often talk about Intel as its major competitor, but just last year ARM shipped more chips than Intel has ever shipped. There are more ARM chips in the world than there are human arms, legs and heads put together. It is a huge company that comes from a small town in the fens. RealVNC is a three-time Queen’s award winner for exports in the past three years. Its software is a critical part of any shuttle launch and has a huge number of applications elsewhere. We have MedImmune, the biggest biotech company in Europe. Marshall Aerospace and Defence Group works in a very different area, but does incredibly important work for our armed forces and a range of others. There are more companies, including the growing, new wave of clean-tech.
Cambridge is a huge success story, which is one of the reasons why unemployment there is so low—the rate is about 2.5%, and the youth unemployment rate about 1.5%. We all have an interest in the success of science and research, because they are key to the success of Britain as a whole. How do we think we will earn our way in 2020, 2030 or 2050 if not in the knowledge-based economy, based on things that we will learn and develop now? They are already key sectors driving the economy and that is set to continue, because the UK continues to punch above its weight in scientific research. Although we only have roughly 1% of the world’s population, we have a huge research base, with 4% of the world’s researchers, an 11% share of world citations and 14% of highly cited publications. We have a great platform to develop and grow a successful knowledge-based economy to develop jobs and growth for many years and decades to come, but how can we do it?
I would like to explore three key areas: money; people; and attitude. Research and development costs money, but not all of it public sector money. UK spending on research and development dropped to just 1.76% of gross domestic product in 2010—well below the European Union average and, for the first time ever, less than China, not to mention pretty much all our other global competitors. That hits the UK economy, because we are less innovative. We are particularly behind in public sector funding: 0.57% compared with Germany’s 0.85%, which gives Germany a huge lead. We know that public money crowds in private funding: the more we spend in this area, the more industry will also commit. I know that it was a fight for the Minister and my right hon. Friend the Secretary of State to ensure that the ring-fenced science budget was protected. It was not cut in the previous spending review, which is a great achievement. There were many concerns. The £4.6 billion was protected, in cash terms, which was essential, but that still equates to a real-terms cut and capital funding took a very large cut. Capital is also essential to good science and research. The huge cut in capital has been ameliorated by a number of new announcements since then, on which I congratulate the Minister. He has managed to pull £1.4 billion, which I am sure he will itemise later, out of the Treasury to rebuild some of that capital. He has £300 million to claw back from the cuts to go, but I am sure he will come up with a way to deliver that from the Treasury.
There are other good new things that I am pleased to see: the Catapult centres, although I still have a reservation about the name; the reintroduction of SMART awards, and I declare an interest as a holder of a Department of Trade and Industry SMART award from a number of years ago; and the extension of R and D tax credits. Those are all good things. We are in a decent place at the moment; it is not as great as it might be, but it is nothing like as bad as it could have been. We must not have more cuts in the forthcoming spending review—that is one of the most important messages in the short term.
I recently hosted an event with the Association of Medical Research Charities to launch its vision for research. There was a clear message from academics such as Sir Paul Nurse, the president of the Royal Society; medical charities such as Cancer Research UK; and industry, such as GlaxoSmithKline, that if we cut now, it would be a huge and clear signal to business that they should not invest in Britain. Companies are mobile. They will leave. Biotech and hi-tech companies will just go somewhere else. They can do it, and if we send a message that they are not wanted here, they will. Our academic base will decline as good people leave the UK or simply leave research to do something else.
Science and research is big business for the UK. The pharmaceutical industry—a huge, global business—generates a trade surplus for the UK of £5.5 billion. The industry is changing and becoming more biotech focused. We have to keep the small biotech companies here. When AstraZeneca closed their plant and decided to move to Cambridge, it was a shame for the north-west, but it is fantastic for Cambridge and for the country that it is staying in the UK. It or any other company could choose to leave. Pfizer has a presence in Cambridge, as does GlaxoSmithKline. We have the largest biotech companies in Europe—but only for as long as we can provide them with reasons to stay.
For the spending review, not cutting capital or revenue budgets is very least that can be done. If we want to prosper, we must increase investment—and it is an investment. A study by the Wellcome Trust, the Medical Research Council and the Academy of Medical Sciences found that every pound invested in medical research generates an ongoing return of about 30p every single year, and 30% returns are fantastically good. Jonathan Haskel of Imperial college business school has estimated that a £1 billion cut in research council funding results in a GDP loss of the order of £10 billion. That is the sort of size we could be talking about.
To provide certainty, the investment absolutely has to be long term. We must find a way of getting away from the three-year cycles. Long-term investment was called for in the “Fuelling prosperity” report, which came out recently from the Royal Society, the British Academy, the Royal Academy of Engineering and the Academy of Medical Sciences. They make the case for investing in research in the long term, to drive UK economic growth. Similarly, a letter from a range of medical charities, industry, academics and parliamentarians across the parties, which came out in The Times a couple of weeks ago, states:
“Long-term funding is needed from the Government to ensure the continuation of the UK as a place blessed with a vibrant research eco-system”.
The message is clear, from all parts of the community involved in this field, that we need long-term funding.
My proposal, which was made in the paper I talked about earlier and is now part of Liberal Democrat policy, is to try to build a consensus around a 15-year 3%-above-inflation increase in a ring-fenced science and research budget, to include capital and revenue. I know that that is ambitious, and that 15 years is a long time, but I think it is the right thing to do and that it is something we could get together. Clearly, no one party can deliver it—no one party will ever be in a position to guarantee funding for 15 years—but I hope that my two colleagues here today, the hon. Member for Birmingham, Ladywood and my right hon. Friend the Minister, will be able to support that aspiration and ambition, and that over the next years we can ensure not just that we do not have cuts in the budget, but that we actually deliver an increase, and a prosperous Britain. That is in all our interests.
It is not, however, just about having the money; the money must be allocated well. It has to be allocated correctly between applied research and blue skies research and we must, of course, stick to the Haldane principle—whatever its exact wording—to ensure that none of us seeks to influence exactly how grant funds are spent, tempting though that might be.
It is the blue skies area that needs to be remembered, because there is a temptation to say, “Let’s just fund the things that are closest to being applied—closest to being products.” That would be a mistake, and it is one that industry warns us about time and again. No one can predict where new ideas will go. When work started on lasers, the world wide web, Google’s search algorithm and monoclonal antibodies, no one knew where it would lead. No one could have predicted their scale, but they are huge.
Probably the least well-known of those is monoclonal antibodies, and the investment from the Medical Research Council in Cambridge’s Laboratory of Molecular Biology, which has generated fantastic world-leading research and many Nobel prizes, also led to a multi-billion-dollar drug, Humira, the profits from which partly paid for the new lab that was opened just a couple of weeks ago. A huge amount of money can be made, but that is never known at the beginning. The Medical Research Council has made £390 million from monoclonal antibodies, but when the grant application was written there was no way it could have been claimed that that would happen—Sir Greg Winter would never have had that chance. In addition to the applied work, we must, therefore, fund excellent blue skies research, for its own sake as well as for its potential returns, because there is an interest in simply advancing human knowledge as well as in getting a financial return.
Aside from the science and research budget, we must also support innovation. As I understand it, much of the innovation budget sits outside the science and research ring fence and it has suffered from cuts in the past. The wonderful new Catapult centres, the SMART awards and all the efforts of the Technology Strategy Board will not work if money is not available to support the final stage of innovation. Equally, however, the money cannot simply be transferred away from basic research; otherwise, we will not have any of the new inventions we need to translate into real products.
We must also ensure that we use the money that is available from all sorts of other sources—medical research charities, for example. A recent letter in The Telegraph from 42 medical research organisations and 130 scientists highlighted the following:
“With medical research charities and their supporters together funding more than £1 billion of vital medical research in 2011, we have made a huge contribution to improving the health of the British population through scientific advances.”
I am sure that we are all grateful for the work they produce and the people who fund them. They call on the Government, and I join them in this, to
“protect both the Charity Research Support Fund and the amount available through it, as well as ring-fencing the science budget”.
I hope the Minister can confirm that we can continue with that support fund.
That is one source of money. We have money that can come in from industry and we need to get more of it through the small business research initiative and all sorts of other research and development mechanisms. We also have money from the Government, and we get a lot from the European Union as well. In this room, at least, we can be pleased to take that money from the European Union and make the most of it. Framework programme 7, which finishes this year, is estimated to have delivered €7 billion to the UK for research. That is fantastic, and the Government should encourage and support the UK in tapping into Horizon 2020, the next framework for research and innovation, which has an €80 billion budget. We want to get as much of that into the UK as possible—I will avoid discussing any referendums on how we use any of that money. The Government could, however, make it easier for that to happen. Yes, they should try to make the European processes simpler—having been involved with the European grant, I know they can be incredibly bureaucratic—but there is also the issue that the full economic costs of the work are not funded. I hope the Government will consider setting up an EU research support fund to meet the costs. In that way, we will encourage UK researchers to pull even more money from the European Union into our domestic research.
There are other things that could happen. The £l80 million in the biomedical catalyst fund has been very welcome, and I hope it will continue. There have been many successful applications to it, from my constituency among others, and I hope there will be money to continue that work. I am also very taken by some of the work developed by the BioIndustry Association on having pots of money available—similar to individual saving accounts—for funding high-tech companies. That model works very successfully in France, enabling people to invest smallish amounts—£5,000 to £10,000—in high-tech growth companies and to get some of the tax advantages of entrepreneurial investment. In France, they have had a good economic return by allowing that.
We should also make better use of the NHS. We are rare among countries in having a wonderful national health service, and it is an excellent place to do research. We have a single organisation that has access to a lot of patients who can get involved, and a lot of information that can be used. Privacy is obviously a huge concern and we must not do things that would jeopardise it, but there is far more we could do to use that rare and precious resource. I am pleased that we now have, as a result of the Health and Social Care Act 2012, a duty to promote research in the NHS. That is very helpful, and much more needs to be done with it. More patients should be told about the trials that are available, and there is a lot of work from the Association of Medical Research Charities and others that highlights that.
I am also pleased that the Department for Business, Innovation and Skills continues to work with the Department of Health; that works very well. What I would not want to see is all the Medical Research Council being transferred into the Department of Health. There must be a separation between the implementation—actually doing health care—and the pure research that the MRC does. The council is not the same as the National Institute for Health Research, and I hope we will not see such a transition. I am sure the Minister can reassure us about that shortly.
I have said a lot about money, partly because the spending review is coming up, but it is not the only thing that matters. Just throwing money at problems does not always work; people matter as well. The UK has to build a highly skilled work force to be able to attract industry and innovation to do the best research, and there are two ways of doing that. One is to start with people here in the UK, at school. Schools must be able to provide a more solid curriculum in STEM subjects—science, technology, engineering and maths—and have teachers who are specialists in their fields. That means primary schools having some sort of science subject leader, and secondary school teachers should have continuous professional development, funded by the Government, to make sure they are on top of what they are teaching. I am also pleased to see the proper teaching of computing—not just of IT, but of how to code. That is an excellent step forward, but I worry about where we will find the teachers to provide that education.
I am particularly concerned about how people consider STEM subjects at primary school. One of my colleagues, a councillor in the east of England, trains primary schoolteachers. On one of her training courses, she asked them to come up with a curriculum for primary school, and every single group left out science. When she asked why, they said, “Well, it’s hard, dull and not very useful.” If that is the attitude among primary schoolteachers—I hope they were corrected—we will have a problem over forthcoming decades. We have to change that attitude where it exists; of course, it is by no means uniform.
We should support organisations such as STEMNET and all other outreach activities. I do not have time to list each one, but they do good work and need support, because we must get many more people in. For example, it has been estimated that we need about 20,000 more engineers a year to cope with the retirement bubble and the growth in the energy, automotive and aerospace areas.
We must consider doing far more to encourage diversity among people who go into STEM subjects. That is not just about women in science, although that is a very big issue; it is about the socio-economic background of people who go into those subjects. We are missing out on a huge number of people who could contribute massively. If fewer women and fewer people from poorer socio-economic backgrounds take STEM subjects, we absolutely have to take stronger steps to correct that.
We have to make sure that scientific and mathematical literacy are there for everybody, because skills taught in those areas—regardless of where students end up in the working world—help to create a scientifically savvy population that can engage in rational debate and critical thought. We want everybody to understand the basics of financial mathematics: how a mortgage works, or how to understand a Daily Mail front page about the latest wonder drug that also causes cancer.
We must ensure that university—and school—courses encourage entrepreneurial thinking, and we must support people to think about that. We need to make sure that people realise that science is fun: people do it because it is exciting.
There are issues about the career paths of academics. It is currently a very transient route for many post-docs, and we need to find out how to have a much more coherent picture. My paper goes through that in far more detail than I can do now.
We must look at funding for postgraduate courses, an issue which I have raised with the Minister on several occasions. I will not go through the pain of the undergrad funding issue—I dislike undergrad fees and have hated them ever since they were brought in by the previous Government and increased by this one, and I still disagree with all those decisions. However, a serious problem is now arising with postgraduates who do not generally have access to funding, except from banks, parents or savings, and may have to pay well over £10,000 to do a course. That has a huge effect on social mobility, because people cannot do those courses.
Tomorrow, with CentreForum, I will launch a report, based on work with the National Union of Students and a range of universities, which will propose some suggestions. I will not say much more about it now because I do not want to draw the thunder from tomorrow’s launch, but essentially, we have to extend income-contingent loans for graduate students, so that there is an easy way for them to get into graduate courses.
Those are some of the things we could do to get good people in the UK, but we must also look for skilled people globally. We should actively encourage students to come here and study, experts to come here and work, and entrepreneurs to come here and invest. Our immigration rules have often given the strong impression that many such people are simply not welcome here. The poor performance of the UK Border Agency, which often took months to make decisions, has made matters far worse. When I talk to companies in Cambridge, the major issue they raise is often immigration policy and how hard it is to get the people they need. I know the Minister has been good at standing up for science in that area.
Departments say that the number of high-calibre applicants has fallen, with promising students heading off to the United States, Canada or Australia because the UK is viewed as student-unfriendly. We have even been thanked for that by leaders in competitor countries. We do not want to be thanked for helping them to take our students.
The Minister for Immigration, my hon. Friend the Member for Forest of Dean (Mr Harper), came to Cambridge a couple of weeks ago, and I thank him publicly for doing so. He met language schools, businesses and universities, and it is fair to say that he was surprised by some of the problems he encountered, which relate not to the direction of Government policy but to UKBA’s over-interpretation of the rules. He offered to help fix many of the problems we are facing, and I thank him very much for that. I hope that will make the difference, because details, as well as the overall policy and messaging, matter. We have to show that we are open internationally in fact and in rhetoric, because we want the brightest and the best to come here to contribute to our economy.
There are many attitude issues that I could talk about in the time remaining. We need to push further on the important issue of open access. It is absolutely right in principle, and the Minister for Universities and Science is right to push ahead with it. It reflects the change in how publication works, with the transition of costs away from distribution, because we can just look at pdfs, the cost of which is very low. Open access is the right thing to do, and will open up information for many more people and help businesses to set up, but more care is needed with the transition, as is a bit more funding. It has to be made very clear, particularly to some nervous academics, that there is no intention to use open access as a way of banning the publication of good work. There will be difficulties during that transition, but we must get there in the end.
There is the related issue of open data. I visited the Open Data Institute in Shoreditch earlier today, and I have to say that I was seriously impressed. It is doing some very impressive work. To give one example of the power of open data, early on in its existence it did a study of statins in which it looked at the data available from prescriptions—anonymised data that did not identify any individuals—and showed that if generics were prescribed instead of brand-label drugs, in cases in which there was no clinical need for the branded drug, it could save £200 million across the NHS. That study was doable because the data were open. There is a huge potential there, of which that study is only the start.
We must encourage academics to publish data in an open way wherever possible, and that should be tied to funding support. A classic case is clinical trials. GlaxoSmithKline has been excellent in opening data on its historical and current clinical trials, for which I strongly commend it. That improves safety and allows better use of existing drugs. I must say that not all pharmaceutical companies are quite so open, but I hope they will all follow GSK’s excellent example.
We must ensure that there is much better use of evidence-informed policy in decision making in this place and in Whitehall, which is far too often lacking. I shall say more about that in two days’ time, when we have a debate on drugs policy in this Chamber. We need to strengthen the role of chief scientific advisers, and we should also look at having a chief social science adviser, so that that area is not neglected but made prominent.
Lastly, we must do far more to encourage more contact between policy makers and academics, so they can learn where there is fresh thinking. One great model for that is the Centre for Science and Policy in Cambridge, and I particularly highlight the work of David Cleevely, who set it up. It has proved an excellent tool to make sure that people in the civil service and businesses can find out what is happening at the interface between science and policy in Cambridge.
We have a lot to do to support science and research: the money, the people and the attitude must be there. If we get this right, we will deliver jobs and growth, new knowledge and exciting technologies, and global competiveness and inward investment; if we get it wrong, we will sabotage our future. I hope that all colleagues will support this call.
Shabana Mahmood (Birmingham, Ladywood) (Lab)
It is a pleasure to serve under your chairmanship, Mr Caton, and to respond to this debate on behalf of the Opposition. The debate is timely given that, as the hon. Member for Cambridge (Dr Huppert) said, we will be going into the comprehensive spending review period later this month. I congratulate him on securing the debate. He is right that we had to postpone our Campaign for Science and Engineering debate, so it is good to pick up some of the issues here this afternoon that we would have discussed in that perhaps more adversarial format.
As a scientist before he became a Member, the hon. Gentleman has a deep commitment to this policy area. Occasionally, I gently point out to him that he is a coalition Member—although not himself in government, his party is—but it sometimes feels as though he is making a pitch from outside the Government, rather than from within. He has a consistent record of arguing for the points that he makes.
The hon. Gentleman gave the example of Cambridge and, as its MP, he obviously has a very strong story to tell. He has a truly world-class university and truly world-class companies on his patch that are doing great business for UK plc by pushing the boundaries of invention and innovation. I will duck the opportunity of trying to get my tongue around his twister of ships and chips and so on, but the company that he mentioned is good not just for his region, but for the country and our whole standing.
The hon. Gentleman also made some important points about innovation as distinct from the overall funding that we provide for science and research. He talked about the incredible importance of the European Union and the money that it makes available for science and research. The UK punches above its weight, as it does in so many other areas, in terms of attracting that investment. Although this is not the place to talk about referendums and our future relationship with the European Union, let me just say that many in the science community support our continued EU membership; they know how important it is to the framework of science and research in our country.
The hon. Gentleman also made some good points about people that I will come to later in my contribution. Given that the comprehensive spending review is looming, we cannot help but talk about the money side of things. I hope that the Minister will use some of the points that are made to him today to arm him as he and the Business Secretary go into those difficult discussions with the Chancellor of the Exchequer. It is true that we are at a critical juncture for the future of science and research in our country. It is unclear whether we will be able to retain and grow our standing in the world or whether we will fall behind in this aspect of the global race. As the Royal Society says, we must keep running just to stand still. That is the scale of the challenge that we face and something that must be in the mind of the Minister, the Business Secretary and the Chancellor of the Exchequer, as they make their decisions in a few weeks’ time.
I am sure the Minister will talk about the Government’s ring-fencing and protection of the science budget thus far in this Parliament. However, he will recognise, as I hope the hon. Member for Cambridge will too, that the true picture is not all that rosy. Although many in the science community are genuinely grateful for the deal that the Minister and the Business Secretary achieved for science on the grounds that it could have been a lot worse, some significant issues about the funding of science still cannot be ignored.
The reality is that we are in danger of losing our standing as a world leader for science and innovation because of the cumulative effect of a short-termist, piecemeal approach, which is underpinned by real-terms cuts in the science budget. The Minister will accept the research by the Library and the Campaign for Science and Engineering that shows the 14% real-terms cut in the science budget thus far and the impact that that will have on our capacity to keep up with our competitors. Not only was this flat cash settlement an actual cut, but the science budget itself only represents about 50% of Government science spending. As we all know, science spending has been hit in other ways, too. For example, the scrapping of the regional development agencies, which spent something like £440 million per annum on science-related programmes before the last CSR round, has led to another reduction in funding.
Furthermore, capital spending, which the hon. Gentleman mentioned, was cut at the beginning of this Parliament by 40%—a total of £1.4 billion. It is fair to say that the Minister and the Business Secretary have worked hard on this matter and implored the Chancellor to put back some of that money. As the hon. Member for Cambridge pointed out, we all know that we are still some £300 million short. The boldness of the decision to cut capital spending by 40% has not been met by a boldness of action to put it back, despite the fact that a mistake was made and that it should be rectified. We are seeing a piecemeal and unco-ordinated way of putting back some of that money. Researchers and industry need a clear investment framework on which they can rely to plan properly for the long term.
The long term really matters in science. The big projects that have been making the news recently, such as the work being done at CERN or at the Crick institute, did not come to life at the beginning of one Parliament and complete their cycle at the end of that Parliament; these are things that take five, 10, 15 or 20 years in the planning, the doing, the inventing and the innovating and then, we hope, in the finding of successful outcomes.
A clear, long-term framework is very important to the science community. One Government decision that I have the most difficulty with and that we would seek to change if we were to form the next Government would be the scrapping of Labour’s 10-year investment framework. What we have seen is a return to a short-term spending cycle. As I have said, researchers and industry need a long-term vision, so that they can plan over time. Although we had a 10-year spending cycle when we were in Government, the Royal Society has called for a 15-year period, and there are others who would argue for longer still. It is clear that long-termism is needed. The result of a short-termist, piecemeal approach is that the UK is falling behind other countries when it comes to investment in science.
I am afraid to say that the Government have also backed away from any commitment to meeting the Lisbon 2020 target of 3% investment in R and D that they had publicly accepted. Even allowing for the current economic situation, we have not been given any goal or even heard how we might catch up in future years. It would be good if we were able to get some detail on that, so that even allowing for the current decisions over how we meet the country’s fiscal challenges, we may at least be able to say when we return to growth that there is some plan for catching up that target.
Many of our international competitors are increasing their science budgets, even those with their own deficit reduction programmes. I come back to the point made by the Royal Society that we have to keep running just to stand still, and keeping up with our competitor countries really matters.
The overall condition of our essential research infrastructure will decline without long-term investment, so scrimping on maintenance capital now will progressively affect research. It will build an investment backlog for the future and it will negatively affect our ability to attract and retain the best global talent. The low level of investment now is not sustainable, and it is storing up problems for future Governments if we have any hope of maintaining our world leading position in science. I hope that we can all agree that we should try to maintain that position.
We do science well in this country. I often say that it should be a bigger part of our national narrative. We often talk about the British as the underdogs in business, punching above our weight, but our world-class higher education sector and our capacity to do science are essential parts of the British story. When it comes to higher education in particular, we are the preferred educators of the world. That is why so many international students want to come to our country.
We are also recognised as leading scientists and thinkers, so our capacity to innovate is something that is appreciated by the rest of the world; it is a competitive advantage and something that we should put front and centre of how we plan to be a major economic force in the middle part of this century. There is a lot of rhetoric around the global race—in political terms, it is a sexy thing to talk about—but it needs to be backed up with some action. I fear that at the moment the short-termist approach will prevent us from being in a position in which we can say that we are going to win the global race.
Dr Huppert
The hon. Lady is saying much that I agree with, particularly with regard to the concerns about short-termism. We want to see a long-term amount of money. Obviously, long-term protection is only good if it goes up. Will she say whether she agrees with my proposal to have a 15-year above-inflation increase in the ring-fenced science budget? I hope that she will say yes, and work on actually delivering it.
Shabana Mahmood
I thank the hon. Gentleman for that intervention. He will not be shocked to hear that I am not going to give a spending commitment for what a Labour Government would do in 2015. However, the broader point is that long-termism is not just about the headline amount given to science. Saying, “This is your deal for 10, or maybe 15, years—off you go” is also important because it encourages private sector investment; the private sector will know that a Government are serious about science, and it will know what will happen if they stay in power at the next election. That certainty breeds greater investment, and it will offer a much better deal. I cannot, of course, give the exact sums that we will allocate when we, I hope, form the Government in 2015, but we will return to that theme as we continue to debate these important issues.
Let me move away from the size of the budget and the length of the spending cycle on which it is based. The hon. Gentleman talked a lot about people, and that is a really important part of science policy, although we often forget that when we are grappling with the overall sums and how long they are allocated for. In particular, he raised a really important point about women in science, which is something I have picked up on since I took up the science bit of my brief. My predecessor, my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah), was a female scientist, so she had experience of being a woman in what is very much a man’s world. I pay tribute to her work as a woman in science and a woman who speaks up for science and scientific issues.
There is clearly a problem: if we cannot ensure that we take forward the best talent that we have and make the most of it, we are truly missing out on something that should be a competitive advantage. Many in the science community tell me that the problem is often less about getting women into undergraduate science degree programmes and more about retaining them once they have graduated, when they are trying to plot their careers as researchers and academics and to combine their work with family life and career breaks to have children. I have said a number of times that the issue is not unique to the scientific community; it is a problem across our society, and those of us in the world of politics know only too well the difficulties that political parties of all persuasions have in attracting female talent into politics and in ensuring that women can progress to the very top in much the same way as men. This is therefore a cross-sector, societal issue, and it is important for the science community, too. In the few months that I have had this brief, I am pleased that so many people—not just women—have wanted to talk to me about women in science and about how we can do more to attract and, equally importantly, retain female talent in the science pool.
I was sad to see the Government withdraw funding from the UK Resource Centre for Women in Science, Engineering and Technology, which was set up when the Labour party was in government to encourage more women into STEM subjects. If the Government scrap something and replace it with something else, I guess that they have an argument that they are still committed to the agenda, but there is no plan B when it comes to scrapping the UKRC’s funding. I would therefore like to hear a bit more from the Minister about his plans regarding women in science and how he sees things developing. How will he ensure that we meet the challenge of not only getting women into science, but retaining them?
The hon. Gentleman made a broader point about inspiring our young people and children into careers in science and about making science fun. One of my best visits since becoming a Member of Parliament was the morning I spent at the Big Bang science fair a few months ago. Tens of thousands of children were part of the fair and experienced it. It was incredible to see the energy in the Docklands arena, as those young people were exposed to science and scientific ideas. One thing that really struck me was a project that had been entered in one of the many competitions being run at the fair. A group of young girls had done a study of the science behind hair straightening. Some of the women reading or listening to the debate will recognise that hair straightening is a big industry, and it is certainly something a lot of women grapple with—it might not affect the Minister or the hon. Gentleman quite so much, but I know a lot about it. It was really interesting that the young girls could take something that mattered to them—they talked about the protective qualities of the different serums that they can put on their hair to protect it from the intense heat that they apply when they use a hair straightener—and understand that there is a lot of science behind it. They were able to study, understand and relate that to their own lives. That was a powerful way to show them that science is all around them and that it is not a scary, dry, arid, austere thing that only geeky boys do when they are at school, but an exciting, challenging thing that they use every day, often without realising it. Lots of good work is therefore being done to make science fun for our young people, although we can always do more.
I sympathise greatly with the hon. Gentleman’s point about specialist science teaching in our primary schools. The Campaign for Science and Engineering has spoken to me a number of times about the issue, which is part of a campaign that it is running. I am very sympathetic to the hon. Gentleman’s suggestion, and I am involved in discussions with the shadow education team about how we might make it happen. However, I absolutely agree with the broad principle, because we need people who understand science and who are passionate about it to be there right from the beginning of the educational journey that our young children make if we are to make sure that they do not drop science as soon as they turn 14, when they have to decide which options to take.
The hon. Gentleman also touched on the impact of the Government’s immigration policies on science and the wider higher education sector. When I was promoted to the position of shadow Higher Education Minister, I had no idea that my previous experience as a shadow Minister in the Home Office team would be quite so relevant, but somebody will talk to me about the impact of the Government’s immigration policies almost every week. The Minister and the Business Secretary are very sympathetic regarding the problems that have been visited on the higher education sector and the science community as a result of the Government’s immigration policy, and I suspect that we are often on the same side when we talk about the fact that the impact has been negative and that we need to change things. Unfortunately, to date, we have been unable to persuade the Home Office and Downing street to change course.
Why is that important? Because the Government’s pledge to reduce net migration to tens of thousands can be achieved only if they dramatically reduce the number of legitimate international students who come to our country, and only if they sit back and pray that lots of British people leave this country, while lots of Brits living abroad do not come back. We cannot get away from that fact. On the other things that impact on net migration figures, such as family migration, the Government have limited rights of appeal and so on, but they cannot do any more without falling foul of human rights law; they cannot outlaw people from having any kind of family life whatever or from marrying spouses from abroad. That leaves international students as the one group the Government can decrease significantly to meet their target.
We are in the bizarre position that the Government are holding up as a sign of success the fact that net migration has dropped, but missing out the fact that that is entirely down to Brits not coming home, Brits leaving and legitimate international students not coming to our country to study. Our competitors are absolutely rubbing their hands with glee over this. I met some colleagues from Australia a couple of weeks ago. The first thing that they said was, “Thank you; you have done such a great job. We made a huge mistake by trying to reduce the number of our legitimate international foreign students. We were starting to pay the price, but then you guys did the same thing, and now they are all coming back to us.” That is a problem.
The Minister for Universities and Science (Mr David Willetts)
Will the hon. Lady confirm that the most recent set of Home Office statistics, in the past couple of weeks, showed net migration falling, and, within that, a rise in the number of overseas students coming to study in Britain?
Shabana Mahmood
There has been a drop in net migration and there is a flux backwards in relation to international students; the overall picture of what has happened in the past three years, since the policy was introduced, has been to create a perception that Britain does not want to educate international students and does not draw a distinction between legitimate international students and those who are here illegitimately or illegally. The London Metropolitan university affair did great damage to our standing in the world. Our competitors have picked up on that, and marketing departments in universities in Canada, Australia and America are homing in on it. It is the one thing that every higher education institution in this country—whether a leading Russell Group institution, a million-plus institution, part of the University Alliance or something else—has said is a big problem. Every part of the sector has been affected by the immigration policy; and it affects scientific talent as well.
Dr Huppert
Does the hon. Lady agree with the suggestion that the easiest route would be to take international students out of the migration figures that are reported in the standard way? People who come here, study and leave are not part of the migration pool.
Shabana Mahmood
To focus on how we measure the net migration target is to miss the point about what has happened. The Government have picked a target; it does not particularly matter what goes into the target, as long as the sole immigration policy is not just to set an arbitrary target limit. Net migration is a useful measure of influxes into a country and outflows, and a useful way for public bodies, for example, to try to work out the future pattern and shape of public services. I am not too fixated on how net migration is measured. There is merit in universities that want to increase the number of their legitimate international students engaging in a numbers-based conversation with their local authorities, so that bus routes and housing need can be planned. There is merit, therefore, in the way net migration is measured for that purpose, but there is a problem if the measure of success is whether it is reduced to tens of thousands. That pledge was made in the knowledge that the only way to get net migration down would be by significantly affecting the number of legitimate international students coming to the country. The Minister must recognise that if the number of such students continues to rise, the net migration pledge will not be met. We must stop sending out the message that the country is not open for business.
As I was saying before I took the intervention, that point is important for science as well. When some of the world’s best scientists and their research teams decide where they may spend the next 10 to 20 years of their careers, it is important that the country should attract scientific talent and be an easy and welcoming place to come to, with an atmosphere of celebration of the contribution made by people who come. If the overall offer from Britain is a bit mealy-mouthed and negative—or, rather, a lot negative, given some of the rhetoric of the past months—and if the immense contribution made by those who come legitimately from abroad to study or work in our country is not valued in words and actions, we face a significant problem.
Robert Flello (Stoke-on-Trent South) (Lab)
I congratulate the hon. Member for Cambridge (Dr Huppert) on securing the debate and apologise for not catching the early part of his speech.
Stoke-on-Trent is well served by Keele university and Staffordshire university. They have had to work even harder at attracting students because of the rhetoric. Potential overseas students were telling them that Britain is no longer a welcoming place to come to. Does my hon. Friend recognise that that situation affects not only the universities and other higher education institutions, but the wider community: the landlords who would let properties to the students, the local authorities that might perhaps collect rates from them and the shops that would sell to them? There are big implications, and not just for the universities.
Shabana Mahmood
That is an important point. Higher education is our seventh largest export—a fact that shocked me when I took on the brief. I did not know that at the time. It is worth billions of pounds to the country. At a time when we are desperate for economic growth, the deliberate shutting down of one of our largest export industries is a big problem. Part of the issue is our reputation: we have been a destination of choice, because of not just the excellence of our institutions, which are world leaders, but what the country is and has stood for in the world. The English language means that there is already an affinity between our country and many others. Our offer contains something bigger, beyond the brilliance of our higher education and science sector, to do with what we stand for.
The rhetoric of the past few months has failed to draw a distinction between legitimate concerns about public services, the pace of change, the nature of identity and community and the things that are important for our continued economic standing. Also, there is a soft power that comes from having educated people who will be the leading business men and women of future and growing economies. We are missing out.
I implore the Government, as I have many times, to change course and bring some sense back to the immigration debate. I urge them to focus on things that people in Ladywood tell me they are bothered about: illegal immigration, which seems to have dropped off the radar. If everything is about net migration, the Government appear not to be particularly focused on enforcing rules that would clamp down on illegal immigration, or on making sure, when people are found to be here illegally, that they are quickly deported. I have for months been telling the UK Border Agency about some constituency cases in which people are here illegally, and nothing has been done; yet international students are being put off coming to study in this country. It is a bizarre state of affairs, and I wish that the Government would bring some sense back to that policy area.
The hon. Member for Cambridge referred to postgraduates and their funding. Universities have for months been telling me that early indications of the impact of the Government’s new £9,000 fees regime are that there is upward pressure on the postgraduate student market, as additional study now seems much less affordable for a generation of students that will graduate with a large debt. That is a problem that universities have been flagging up for a while.
By 2015, the first cohort of students under the new regime will graduate. There is a danger that their future decisions about whether to pursue postgraduate study will be inhibited by the view that it will be unaffordable. Many people have therefore talked, as the hon. Member for Cambridge did, about an income-contingent loan system for postgraduate study. The Minister and I have debated postgraduate funding before in Westminster Hall and recognised that it poses a significant challenge at a time of economic difficulty. However, we need to grapple with the supply of graduates into postgraduate study. If we fall behind, that will affect our future research base.
Dr Huppert
I am sure that the hon. Lady did not mean to imply that people who go on to do postgraduate courses do so straight after undergraduate courses. I am sure that she is well aware that a lot of mature people go on to do postgraduate study. People do part-time postgraduate courses as well. Lots of people already have concerns about postgraduate funding, and a number of those cases are nothing to do with the cost of undergraduate education.
Shabana Mahmood
The hon. Gentleman is right to point out that postgraduate study is not only something that people take on immediately after their first degree. The conversations that I have had with universities in the past few months have been particularly about the additional pressure from the new fees regime and how they think that it will inhibit future student behaviour. So the universities are thinking five to 10 years ahead as they consider the overall health of the UK research base, which they are right to do.
Robert Flello
I am most grateful to my hon. Friend for giving way again; she is being most generous with her time. I am also hearing from a lot of graduates—either recent graduates or, indeed, people who are looking again at studying—who are finding the general labour market so difficult that they perhaps see university as an alternative way either to further their own skills or to move their career on, when they are having difficulty moving it on in work; but they cannot actually afford to go to university as an alternative. Is that something she has encountered?
Shabana Mahmood
I thank my hon. Friend for that intervention; he is right to make that point. One of the things that lots of business leaders in particular have been talking to me about in the last few months has been that in previous recessions some of our biggest companies would have sent some of their work force back into additional study to expand their skills, in the hope that by the time those workers finished their studies the companies might be on an upswing again and benefit from having refreshed and re-energised workers who would have had the opportunity to go out there and explore new ideas. That has been missing from the behaviour of big companies in this recession, so there are changes in how people are reacting to the current recession, the squeeze on living standards and the way in which they are making decisions about study and improving their qualifications.
People from all parties have to grapple with that issue, because it is in all our interests to ensure that the UK has a properly qualified labour market that can meet our future needs. That is not just an investment for now; it involves thinking about what people will be doing years from now. I often say to young people I meet that the jobs they will be doing in 20 years’ time probably have not yet been invented. The pace of change is very quick, and the ability of our work force to refresh and renew their skills quickly is becoming ever more urgent.
I will finish my remarks by returning to money, given that the comprehensive spending review is looming in just a couple of weeks’ time. I hope that the Minister is able to continue to make the argument for science. He is a supporter of science and his work supporting science has been much appreciated by people in the science community. I hope that he is able to continue to make the case for science, but I also hope that he is able to argue for something that looks like a much longer-term approach, so that we get away from a piecemeal, “let’s just survive this year or this Parliament” approach and consider having a bigger and bolder statement about how this country truly thinks it will win the global race.
The time has come for rhetoric to start to match reality, if not to match reality completely; the Minister would not expect me to say that it would completely match reality because we are, after all, the Opposition. Nevertheless, I hope that we can get to a place where rhetoric starts to match reality and that we will be truly able to say in the middle of this century that we still hope to be a global power, punching above our weight and doing science well.
The Minister for Universities and Science (Mr David Willetts)
I appreciate the opportunity to respond to this very important debate, Mr Caton, and I congratulate my hon. Friend the Member for Cambridge (Dr Huppert) on his excellent introduction of it. As he said, if we were not able to have this debate at a Campaign for Science and Engineering event, at least we can have it in Westminster Hall. I also enjoyed the contribution to the debate by the hon. Member for Birmingham, Ladywood (Shabana Mahmood).
There were many points in my hon. Friend’s speech that I agreed with, but I just want to mention a couple of them to start with. First, he rightly said that although this debate is called a debate about science, we are actually talking about the wide range of research activities across all disciplines. Indeed, within the science ring fence I was very keen, on the advice of the experts, that we should not do some dramatic rebalancing away from the arts and humanities or whatever. Within that ring fence, we have broadly maintained the cash funding going to the Arts and Humanities Research Council and to the Economic and Social Research Council. In fact, one of Britain’s strengths—we face challenges, but we should not forget our strengths—is that for a medium-sized economy we have an extraordinary range of scientific and research activities, and as every major challenge facing the world will be tackled by harnessing a range of different disciplines it is very important that we maintain that breadth.
I also very much liked and strongly agreed with my hon. Friend’s point that, unlike conventional fears about “crowding out”, this is an area where we “crowd in” spending. Indeed, there is a theme running through a lot of the new initiatives that the Government have been able to introduce of actively trying to encourage industry, business and charities to come in and invest with us. That was part of the logic, for example, of the competition for the investment in new research and development facilities on university campuses, the research partnership innovation fund. With £300 million of public money, we have attracted more than £700 million of private investment. There has therefore been £1 billion of new investment in R and D on university campuses, but with only £300 million of that £1 billion counting as public expenditure. My hon. Friend made a lot of other good points, but the two that I have mentioned particularly caught my attention.
Let me briefly touch on the nitty-gritty of spending, because underneath the fine words it is obvious that Members want to focus on where we are on spending. There is a powerful logic for the science ring fence as we have constructed it for this Parliament, because for the first time it brings together all the main areas of current spending. It is deliberately and explicitly a current spending pledge for this Parliament, which means it brings together the quality-related research funding from the Higher Education Funding Council for England, running at about £1.6 billion a year, and the spending of Research Councils UK, running at approximately £2.8 billion a year. In addition, there are specific items such as the funding for the learned societies and the Higher Education Innovation Funding programme, which get us to the £4.6 billion ring fence. I think that this is the first time we have had a ring fence that has included all those items, so that even in a time of austerity we have been able to say that we are maintaining the cash going into current activity.
Although sometimes people have set alongside that what has happened in the retail prices index and said, “Well, that is a real-terms cut”, if they look at the advice that we have received from the experts about the efficiency of the science base’s performance, they will see that there clearly was, and still is, scope for efficiency savings. In so far as any group of scientists and researchers can save money by working more efficiently, they can be confident that that money is extra resource that can go into real activity instead, because it is within the ring fence.
To give one example of how we are generating efficiency savings, there is now far better sharing of scientific kit than there used to be. If we consider some of the initiatives, for example, in the N8 group of northern universities, we see that for the first time—it is rather shocking that it is happening for the first time—those universities are preparing registers so that they know all the equipment that is available in all their science labs. Consequently, before one of them buys some expensive new piece of kit, they can work out whether they can share a piece of kit that one of the other universities has. If they do need new equipment, they can purchase it collectively so that it can be shared among them. I do not buy the argument that performance and efficiency are fixed, and that the cash ring fence therefore equals real-terms cuts.
I am pleased with what both the previous speakers have said about the scientific community, and I greatly appreciate and salute the community myself. However, one of my challenges to the community is to turn the cash-protected ring fence into a real resource-protected ring fence by delivering efficiency savings to offset the rate of inflation.
It is indeed the case that capital is outside the ring fence. Again, that was a deliberate decision. The aim in the time of austerity was at least to keep the activity going. However, more discretionary decisions about capital investment can of course be taken. I must say that we inherited some stark discretionary decisions from the previous Government. There had been an artificial surge in science capital spend in 2009-10, but we then inherited plans for significant reductions in science capital spend, as part of a wider reduction. People should remember that the 40% reduction in capital spend was simply the overall plan for capital that we inherited from the previous Government. We did not add any further cuts.
Let me get back to the figures. Initially, about £1.9 billion of science capital was expected in the five years of this Parliament. We have been able to add approximately another £1.5 billion to that so that we have ended up with science capital spending, over the life of this Parliament, that is not out of line with the level that it was running at before the exceptional year of 2009-10. With great support from the Chancellor, who completely understands the value of science, I have taken decisions that have enabled us to have imaginative investments in new science capital. I will not go through the details of that now.
We have heard criticism about those being ad hoc decisions. My hon. Friend made an eloquent plea, asking, “Can we have a long-term plan?” Last autumn, Research Councils UK published a strategic framework containing its plans. In fact, it was launched in the most favourable circumstances possible, as part of a speech by the Chancellor in august surroundings in the Royal Society. I cannot think of a better way for a capital plan to be launched than via a speech by the Chancellor.
We did not commit ourselves, there and then, to all the capital spending that has been set out, but we provided a framework and recognised the uncertainties of politics and finance. We cannot always be sure exactly what we will be able to afford at what moment. Nevertheless, we have a clear, consistent, long-term vision. Drawing on the expertise of the scientific community, we tried to identify where the need for new capital was most intense and where there were strong arguments for extra capital investment. We published that document, and in the autumn statement the Chancellor made a further £600 million of investment that helped deliver on some of those aims. Even with capital, our record and our plans show that we have achieved a lot.
I do not want to get into specifics at this rather delicate moment in the plans for public spending in 2015-16, but the coalition stands by its pledge. We are aiming to make Britain the best place in the world to do science. That is partly a matter of financing and partly about the wider context and culture. For example, our lead in the global debate on open access and open data ensures that we are seen as serious players in the science debate. Indeed, I look forward to putting on the agenda for discussions with G8 Science Ministers in London, just over a week from now, what we can do to agree on further progress towards open access to research findings internationally and—even trickier, probably—how we can ensure greater access to the data behind the research findings. In that respect, there are a host of rather tricky technical questions about standards for the storing, and hence the mining, of data. We can be proud of what we are trying to do to support Britain’s excellent reputation on science.
Let me touch on two or three specific questions. First, my hon. Friend asked about postgraduates. I understand the anxiety about postgraduates. I have to say that the Government have not been deliberately reducing funding for postgraduates; the funding through research councils and HEFCE has been broadly maintained. There has been some shift in some of the research councils’ policies on larger centres for doctoral training, reflecting a view that it is probably better for people studying for doctorates to be in centres alongside other people doing so. That has also enabled us to make stronger connections between people doing doctorates and their opportunities for business and industrial experience.
We have to understand what is happening with postgraduates. Some universities increased their postgraduate fees in line with what was happening on student fees, but, of course, the latter was being done as part of a policy and was matched by access to loans only to be repaid when the graduates were earning more than £21,000. There is not the same kind of programme for postgrads, so the decision by universities to raise their fees, even though there had not necessarily been any reductions in funding, has had some impact on demand.
Arguments are being made for postgraduate loans. I welcome the debate about options for postgraduate student funding, but my experience with part-time students suggests that if we went down that route, there would have to be some controls over numbers and some regulation of postgraduates, which would change the postgraduate scene from the relatively open, unregulated one that exists at the moment. Pros and cons need to be carefully assessed.
The hon. Member for Birmingham, Ladywood asked about women in science. I understand where she is coming from, and I agree that the science community needs to do more to deliver diversity. I tracked down some depressing statistics, showing how many people with good As and A*s in GCSE physics and maths converted those into a decision to carry on at A-level. That brings home the challenge that she is concerned about. Some 52% of boys who get an A* at GCSE physics carry on to do A-level physics, but only 25% of girls who get an A* at GCSE physics do so. That is a real challenge. Meanwhile, it is interesting to note—sadly, we are talking about gender stereotypes—that 41% of boys with an A* in GCSE biology go on to do A-level biology and 56% of girls with that grade go on to do so. Some decisions are being taken that we need to tackle. I will be at the Cheltenham science festival later this week, which is a great event, and among the many things that I will celebrate there, I look forward to meeting our STEMNET ambassadors—now 40% female, which helps—who go round schools and colleges encouraging young people to get into science. There is obviously far more that we can do.
We have made progress and we strongly support the Athena SWAN principles, aimed at diversity. In the past year, the Department of Health has required clinical medical schools to have a silver award for Athena SWAN principles. Research Councils UK, in a statement earlier this year, which I welcomed, said that it expected institutions in receipt of RCUK funding to provide evidence of commitment to equality and diversity. Participation in Athena SWAN was the kind of evidence that they were looking for. We are trying, without getting too directive, to use our nudge powers—the fashionable doctrine that we in the coalition signed up to—to get research councils to use their clear financial clout to nudge institutions towards those important Athena SWAN principles.
Both my hon. Friend the Member for Cambridge and the hon. Member for Birmingham, Ladywood, asked about overseas students and student visas. I have to say to the latter that, not for the first time, Labour’s figures do not add up. The evidence that I cited in my intervention shows that it is possible to reduce the total net migration number, as measured by the United Nations, and maintain the flow of university students. I was intrigued and encouraged when she did not follow my hon. Friend into the issue of the measurement of migration. There are different ways of constructing the statistics.
There are two crucial issues for higher education institutions. First, they fear that, in response to bad figures on net migration, there would be a crackdown on legitimate overseas students as the only way of meeting the target, but we made it absolutely clear in the coalition’s mid-term review:
“We will place no cap on the number of genuine students coming from across the world to study in this country”.
We have no plans to introduce any such cap, so there should be no kind of planning blight with people saying, “We are okay at the moment, but they are going to do something nasty to introduce number controls.” There are no such plans, and we made that clear in the coalition’s mid-term agreement.
The second anxiety—I noticed how the hon. Lady shifted her ground to this position—is about bad public relations and bad publicity. There has been very bad publicity, with hostile and often misleading media coverage, in India in particular. That is why the Prime Minister made it one of the priorities of his most recent trade mission to India, on which I accompanied him with representatives of higher education, to get the message across in India that legitimate students are welcome, with no cap on numbers. I heard him say that in interview after interview, and I took the opportunity to say so, too. We all need to do everything we can to get that message across, which appears to be a particular challenge on the Indian subcontinent; the growth in the number of students coming here from China is healthy and being maintained. Our commitment on not planning to introduce number controls in the future should help.
Dr Huppert
The Minister is absolutely right. There is no cap, but there are issues with perception. There are also problems with administration, and there are cases of students being badly dealt with by the UK Border Agency, as it was. Will he try to ensure that problems that do not fit with the policy are corrected?
Mr Willetts
Yes. I accept that there are problems with administration, and the UKBA, HEFCE and Universities UK are now working together in a more co-operative spirit than we have seen for a long time to try to address those problems.
My hon. Friend the Minister for Immigration is now visiting universities. We have heard about his visit to Cambridge, and I went with him to the London School of Economics a month or two ago. It was an interesting visit, and it began with LSE officials saying, “One of our female students came back into the country yesterday to sit her exams. She wasn’t able to take them earlier because she had been ill, but, sadly, she was detained at Heathrow”, or wherever it was. They asked, “Could you perhaps ensure that she is released so that she can come and do her exams?” My hon. Friend undertook to sort that out, and I am pleased to report that she was released. My hon. Friend is actively visiting universities. He has already visited Cambridge and LSE, and I think he plans to visit others. I accompany him when possible, and he is trying to ensure that the systems work well and effectively so that universities know where they stand.
I will conclude this very useful debate by referring to some other initiatives, because I do not see what we have been doing on science as simply a defensive operation for maintaining the cash spend. The coalition can also be proud of the initiatives we have taken to drive forward the agenda, and I will end with some brief examples of those initiatives.
First, I am sorry that my hon. Friend the Member for Cambridge does not like the name, but I think “Catapult centre” is a great name—although admittedly it is a bit unfortunate for the space Catapult centre. [Laughter.] Britain withdrew from having its own launch vehicle 30 years ago, but the space Catapult centre is not an attempt at bringing back a new, cheap option for a launch vehicle.
The space Catapult centre is a bit tricky, but the rest are excellent. Of course, the Catapult centres are our attempt to catch up with the German Fraunhofer institutes, and it is interesting that, in his report for the outgoing Labour Government, Hermann Hauser proposed something similar. When my party was in opposition, I was involved in commissioning a report from James Dyson, and he also proposed something very similar. The Catapult centres are proving to be a great success. We started with the high-value manufacturing Catapult centres, which drew on a lot of facilities that already existed. We inherited those facilities, but we spread them into exciting new areas such as regenerative medicines, applications of satellite data and renewable energy.
Another initiative is the catalyst fund, which tries to provide rather greater cohesion between research council spending and Technology Strategy Board spending. The £180 million catalyst fund in life sciences comprises £90 million of Medical Research Council funding and £90 million of TSB funding working together so that researchers in the life sciences may have a grant—it is non-dilutive finance—to fund their work all the way from the lab to commercialisation. The reaction to that scheme from researchers and industry has been very positive, and we have been able to repeat it on a smaller scale in one or two other areas such as biotechnology.
At the beginning of my speech, I think I referred to the research partnership investment fund and the co-funding of higher education R and D capital. That has now leveraged £1 billion. As well as those types of innovative policies, we continue to play a full role in the development of science globally. Later this week, we will be celebrating the topping out ceremony for the Francis Crick Institute in London. There is fantastic, massive investment in the life sciences in London. Last week, as my hon. Friend the Member for Cambridge mentioned, Her Majesty the Queen officially opened the new buildings for the laboratory of molecular biology in Cambridge. Sadly, I was not able to be there, but it has a claim to be the post-war world’s most productive science lab, and it is up there as one of the greats.
In Britain, we have also been able to play a leading role in the square kilometre array, which is a massive radio-astronomy project that will involve 3,000 satellite dishes spread across the deserts of Australia and South Africa. The massive data flow from those dishes will be coming to and managed out of Jodrell Bank, where there are the finest traditions of radio-astronomy. We are keen to use the square kilometre array to drive the development of scientific capability in, for example, sub-Saharan Africa, because it will be one of the biggest single science investments that southern Africa has ever had. We can be pleased with the initiatives we are taking, and I will discuss open data and open access at the G8 summit.
As I believe there is about to be a Division in the House, I will conclude by welcoming the high level of shared recognition, across all three parties represented today, of the importance of science and of supporting it. In a way, the fact that our three parties approach science in that vein is our best single guarantee of long-term stability for scientific activity in this country.
A120 (Colchester)
(10 years, 11 months ago)
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Mr Bernard Jenkin (Harwich and North Essex) (Con)
I am extremely grateful for the opportunity to debate this issue and I thank the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes (Norman Baker), for being present to reply.
The A120 is a major economic artery in north Essex. Its route follows the old Roman road of Stane street from Standon in Hertfordshire, through Colchester and on to Harwich. Today, it is the vital trunk route from the M11 and Stansted airport to the port of Harwich. Its importance nationally, regionally and locally was recognised when the Department for Transport published a route-based strategy for the A12 and the A120 earlier this year. The route supports the national and regional economy by providing the link from London and the south-east to the ports of Harwich and Felixstowe and on to Europe. Locally, it is used as a commuter route, serving the growing towns of Chelmsford, Colchester and Ipswich.
The road will be functioning above capacity by 2021, and will struggle to keep up with demand if the large amount of growth proposed for the towns and cities along it is built. A significant level of growth is planned along the route in terms of jobs and houses. The key areas are around Chelmsford and Colchester, but the port of Harwich is also expected to expand.
Despite all that, the A120 is not designated as part of the core network, which prevents the road from qualifying for access to the £13 billion pot of funding in the European Union’s trans-European network fund—if we are going to pay into it, we may as well get our money out of it. There is no excuse for that; it is the only road in the UK connecting a major port to a major airport.
Improvements to the road were the subject of a section 106 agreement that was included in the Bathside bay planning application for the development of a five-berth container port at the Harwich International port. The development, however, is on hold due to the downturn in world trade, so the improvements suggested in the section 106 agreement, which would have addressed the failings I am about to discuss, will not happen in the foreseeable future. Improvements cannot be left any longer, and certainly cannot remain dependent on future developments and planning applications.
The key safety concerns must be addressed. In particular, the stretch spanning the three junctions of Harwich Road, Pellens Corner and Park Road is extremely dangerous. At each of the junctions, traffic turning right must cross the central reservation and oncoming traffic, which is travelling at the national speed limit of 70 mph. The geography—the ground rises, and there is a bend towards the Pellens Corner junction—makes it extremely difficult to judge the speed of oncoming traffic. Derek Hambling, the manager of local bus company Cedric Coaches, whose drivers use the junction every day, comments:
“I have seen many near misses where cars have been edging out to see past my bus as I wait to turn right towards Elmstead and have made traffic on the A120 swerve to miss them.”
Following a spate of accidents, works were carried out in February and April 2012 with the aim of making those junctions safe—I am grateful to the Highways Agency for its efforts. The overwhelming response from members of the public who use the junctions, however, was that the changes did not make the junctions any safer. In fact, drivers found that the new road markings made the junctions harder to navigate and even more dangerous. I speak from my own experience, because it is possible to lose the sense of where one is in the junction on a dark and rainy night, even if only driving down the A120.
Mr Brooks Newmark (Braintree) (Con)
I am listening to my hon. Friend with great interest, in particular as he discusses accidents that can happen. The focus of his interest is the eastern section of the A120, but, west of there and still on the A120, between Braintree and Marks Tey, there are two other accident points. One is at the turning of Bradwell village, where I live, where numerous accidents happen, and a bit further along at the junction between—
Mr Newmark
Does my hon. Friend agree that more investment is needed on the A120 west of Colchester as well as east of it?
Mr Jenkin
The three junctions I mentioned raise questions about the safety management of many similar junctions on the trunk road and motorway network: are they given sufficient priority? If as many injuries occurred on the railways or in the aviation industry as occur on our roads, far more money would be spent on that, and a far higher priority would be given to it than is given to these accident black spots. That is the point that I think my hon. Friend wants me to make about the junctions he discussed.
Fortunately, we have not had any fatalities at the three junctions since the works were completed—perhaps that is a benefit of the changes—but there has been a steady stream of serious collisions, often resulting in severe injuries, proving that that stretch of road remains extremely unsafe. We have been lucky. During the 12 months since the junctions were improved, there have been 10 incidents, nearly seven times the accident rate that would be expected statistically speaking. Prior to the junction improvements, the accident rate was 6.3 per 12 months, or 4.6 times the average expected statistically. The junctions were already dangerous, and may now be even more dangerous. Those figures again bear out Derek Hambling’s observation:
“It is much more dangerous than it was before the changes.”
The Highways Agency accepts that more needs to be done to improve safety on this stretch of the A120, and I am extremely grateful for its responsiveness. However, it carried out a further safety audit which gave rise to its proposal to close the gaps in the central reservation so that drivers would no longer be able to turn right off the A120 across the path of the oncoming traffic. That will stop accidents at the location, but it is not a practical or safe solution.
First, it will significantly increase many local journey times, including those for emergency vehicles responding to call-outs. Scheduled public bus services will be affected, and adding half an hour to a local bus journey is not unforeseen. There is no doubt that it will damage the local economy. Nigel Dyson, vice-chairman of Little Bentley parish council, commented:
“Since 2005 we have been fighting to stop the deaths on the A120 and get a solution”
but
“we are really no closer to doing this, and just to plunge our villages into chaos is not the solution.”
We must be mindful of the problems that that would cause for local businesses. Steve Wilcox, chairman of Little Bromley parish council, pointed out:
“The impact on local businesses will be significant. There are a number of businesses in Little Bromley”—
and in other villages—
“which operate on small margins, relying on deliveries or visiting trade. The pub trade, which is already struggling, would be dealt a serious blow putting them at risk in the village and the surrounding areas…The closure of these crossovers will affect a great many communities within Tendring, particularly the small rural ones struggling to thrive. Communities as far away as Clacton, Walton, Frinton and Harwich will also be affected.”
A local pub landlord told me:
“The closure of the access from the A120 to Little Bromley from Harwich, Clacton and surrounding villages will have a devastating effect on the future of the pub. As well as being a locals’ pub over 50% of our customers currently travel from these areas.”
That closure will put traffic back on to local back roads, with the attendant safety risks, and this is the point I want to concentrate on. One local couple said:
“There have been too many injuries and too many deaths over the past ten years, please do not relocate these accident black spots on to our country lanes.”
Many of the back roads and country lanes are very narrow and totally unsuited to a volume of commuter or bus traffic.
A long-term solution is needed. Ideally, it will include a roundabout to cater for two junctions, and closure of the third junction. This proposal is supported by Cedric Coaches, and the Highways Agency describes it as
“a viable long term option”.
However, the money must be found. There is an economic case for it at local and regional levels, given the importance of the road and the junctions to the local economy; but most importantly there is a strong case based on the improved safety that it would bring to the junctions, which they have lacked for so long.
In the meantime, interim measures are needed. The preservation of life and avoidance of more accidents is paramount. I recognise the pressure on the Highways Agency to act, but I share the overwhelming view expressed by local residents that closing the gaps in the central reservation cannot be the long-term solution. Peter Halliday, leader of Tendring district council, states:
“Whilst we acknowledge the safety issues that present themselves to road users at these junctions, the compounding of rural isolation their closure would cause is unacceptable for our district. In particular those residents and businesses that rely on two way access onto the A120 and those that simply need to cross the road to go about their daily routine. We simply cannot understand why, as is the case in other locations, speed reduction measures can’t be put in place to reduce the regularity and severity of collisions and free unfettered access to the major trunk road be maintained.”
Priti Patel (Witham) (Con)
I congratulate my hon. Friend on securing this important debate. Does he agree that, central to his premise regarding the required safety improvements to the east of the A120, is the need for much more strategic and long-term thinking, and to explore making that part of the A120 an economic corridor that will bring substantial benefits to all, including many of the rural villages along that stretch of the road?
Mr Jenkin
I am most grateful to my hon. Friend for her intervention because she reinforces my earlier point about the huge economic importance of this route and emphasises its potential. However, the burden of my point today is what needs to be done now. The issue cannot wait for the long term and a strategic decision to be worked out and implemented: it must be addressed now, particularly given that it has been brought to a head by the threat of closing the junctions.
Steve Wilcox of Little Bromley parish council agrees that in this case:
“The correct, immediate, action is to impose a 40mph speed limit, enforced by speed cameras, and to rectify the dangerously misleading road markings which fail to indicate the correct priorities and the poorly marked traffic islands. The junctions should be then dealt with by providing a suitable designed traffic roundabout as a matter of utmost priority.”
I have argued that, instead of closing the gaps, there should be a reduced speed limit, coupled with enforcement using average-speed cameras. Speed is part of the safety problem. A seven-day speed audit in 2011 showed that between the Park road and Bentley road junctions more than 40% of vehicles were exceeding the speed limit, and that did not include heavy vehicles, which are subject to a lower speed limit and may well have been exceeding their own speed limit, but not 70 mph. Needless to say, that makes the junctions more dangerous and accidents far more serious. In four of the six accidents at the Harwich road junction since the works on the junction,
“failure to judge the other person’s path or speed”
was cited as a likely contributory factor. Correcting excessive speed would make it easier for drivers to make those judgments. The Highways Agency safety audit report recognised that a reduction in the severity of collisions
“could be achieved through reducing the speeds on the A120 by implementing a reduced speed limit and enforcing with speed cameras to ensure compliance.”
Reducing traffic speed would reduce the severity of accidents. Fortunately, the decision to close the gaps has been put off for a month or so, so that alternatives can be considered following public opposition to the proposal. I am grateful for that. We cannot have further delay while we wait for yet another safety audit to determine which is the best way to resolve this ongoing problem. Funding must be found for a roundabout at Pellens Corner, and in the meantime more immediate short-term measures must be taken, preferably an enforced speed limit reduction.
The only argument against average speed cameras appears to be the cost, but I am afraid that that is not good enough. A 40 mph speed limit would undoubtedly save lives and money. The same cannot be said for the proposed gap closures. Some lanes around the A120 are hardly wide enough for a school bus, and there are blind corners, blind driveways, no footpaths and there is no speed limit enforcement. That is not a practical or safe solution, which closing the gaps would require us to adopt.
We need a roundabout as soon as possible. In the interim, the only practical solution is average-speed cameras. In a letter to me today, the Under-Secretary of State for Transport, my hon. Friend the Member for Wimbledon (Stephen Hammond), who has responsibility for roads, makes no reference to a lower speed limit and enforcement measures. I am disappointed by that. Please will the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes, who is at least the Minister for traffic management, take that very clear message back to his colleague in the Department.
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
I begin by congratulating my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) on securing this debate on safety on the A120 east of Colchester. I know that he has rightly been campaigning for a long time on the issue and that he is concerned about the safety record of the road. I recognise his continuing concern, hence his raising the importance of the subject for his constituents, local businesses and the local economy this afternoon.
I am aware that my hon. Friend has written to the Highways Agency and has asked parliamentary questions on the subject, and that he recently met my ministerial colleague, the Under-Secretary of State for Transport, my hon. Friend the Member for Wimbledon (Stephen Hammond), to discuss modifications to the road layout at Harwich Road, Park Road and Pellens Corner junctions completed in April 2012, as well as the continuing safety problems, which he referred to, and what might be done to tackle them. I understand that my ministerial colleague wrote to my hon. Friend recently to provide an update, as he confirmed.
Before I respond to the specific points that my hon. Friend raised, it is perhaps worth taking the opportunity to set out the Government’s position on road safety. It remains a top priority for the Department. We have a good record, but we are not complacent, and we are determined to improve on it. The Secretary of State has made that a priority since assuming office at the Department. We are determined to improve by training and testing drivers more effectively, by raising awareness of road safety generally, by enforcing the law, and by investing in our roads to make alterations to improve safety when the road itself is a problem.
The Government’s strategic framework for road safety sets out our vision for achieving that objective. It is supported by the Highways Agency’s commitment to make further safety improvements to reduce casualties on the strategic road network. The network is the Government’s largest single asset, currently valued at about £100 billion and comprising approximately 4,350 miles of motorways and all-purpose trunk roads. The Government recognises the importance of transport infrastructure to support the economy, and we have already announced increased levels of Government funding to deliver improvements targeted at supporting economic growth. At the 2010 spending review, we began investing £1.4 billion in starting 14 major road schemes over the spending review period, with another £900 million to complete existing schemes.
About £1 billion of new investment was allocated in the 2011 autumn statement to tackling areas of congestion and improving the national road network. In the 2012 autumn statement, the Chancellor of the Exchequer announced additional capital investment in this Parliament that would enable construction to begin on further schemes and others to be accelerated. Those proposals will make an early contribution to stimulating economic growth.
The Chancellor also announced in his 2012 autumn statement the provision of a further £100 million of capital expenditure in this spending review period to undertake further pinch point schemes, bringing the total fund to £317 million in that period. That includes a £0.28 million pinch point scheme to widen Galleys Corner roundabout south of Braintree. Two other schemes were suggested for pinch point funding by the local enterprise partnership. One was at Earls Colne, which unfortunately did not, in our estimation, offer value for money. The other was at the junctions that are the subject of this debate, but it was unable to be taken forward from that funding source, as it was considered unlikely to be delivered by March 2015 because of deliverability risks that were due to land requirements. I will perhaps come back to that point.
I want to skip to the main points that my hon. Friend raised, and if I have time, I will come back to the comments that I have been invited to make about route-based strategies. Although they are interesting, they are perhaps less germane to my hon. Friend and the matters that he has raised directly this afternoon, which I take very seriously.
I have said that the Government recognises safety as a top priority. I share my hon. Friend’s deep concern and recognise his continued campaign for improvements at the junctions. Although the overall average accident rate for the A120 east of Colchester is less than the national average, the rate varies, with that for junctions generally higher than on the rest of the route. The collision risk at those particular junctions is significantly higher than one would expect. That is not acceptable, and I fully acknowledge that improvements are necessary.
It is regrettable that the modifications completed in April 2012, although generally delivering a small reduction in speeds and an improvement in speed limit observation, have not been successful, based on current evidence, in reducing the number and severity of collisions, as one might have expected. The Highways Agency is, as a priority, investigating options to try and make those junctions safer for the public.
The Highways Agency’s road safety audit concluded that further measures to improve safety at those junctions should be investigated and that the most effective way to improve safety would be to close the gaps in the central reservation. That was because the recent accident history suggested that motorists commonly find it difficult to judge the distance and speed of approaching vehicles when undertaking right turn movements at the junctions. If, following surveys, the Highways Agency concludes that it is not feasible to close the gaps, the severity of collisions could be reduced by implementing a reduced speed limit, as my hon. Friend advocates, enforced with speed cameras to ensure compliance. However, the Highways Agency, at the moment, has concluded that a reduced speed limit would not significantly reduce the frequency of accidents. It favours gap closures as a preferred short-term option, and it is continuing to investigate a longer-term solution.
Norman Baker
I understand that point entirely. I fully recognise that simply closing the gaps will have an adverse affect on local residents and businesses, as my hon. Friend has eloquently described today. Indeed, diversions could be several miles long, depending on the journeys to be taken. Therefore, prior to deciding on the most appropriate method to improve road safety, traffic surveys will be undertaken to provide information on that and the likely impact on the local roads. He was concerned about rat-running as an unintended consequence of any changes.
I am advised that the surveys will be carried out in June. The Highways Agency, working with Essex county council, because clearly, it is responsible for the side roads, and the police, will use the results of those surveys to determine how best to improve road safety in both the short and long terms. I can confirm that consideration of the use of a speed limit will inform the decision, and that that is not intended simply to move the problem elsewhere.
At this stage, I want to make a point about localism and devolution. Across both coalition parties, the Government has been very keen on championing that and on paying more attention to what is said locally. I feel that we should be listening to local MPs, who know their patches very carefully, before final decisions are taken on any alterations to road schemes in their areas. Therefore, I confirm that I will feed back the comments my hon. Friend has made this afternoon to the Under-Secretary of State for Transport, my hon. Friend the Member for Wimbledon, and ensure that the Highways Agency is aware of his views. He has asked whether there could be a speed limit trial, enforced by cameras. Clearly, that is something that will need to be considered. It is not my responsibility, but I will at least undertake to ask that that is properly considered before decisions are taken to close any gaps, which I know is of concern to my hon. Friend.
My view is that we need to look at all the options. Obviously, costs will be a factor, as will an assessment by the Highways Agency of the likely success rate of any particular action it takes, both in terms of the positive upsides in reducing accidents and the negative downsides in consequences for local residents.
Mr Jenkin
I am waiting for the Minister to raise the land acquisition issue, which I will want to intervene on him about, but will he explain why he thinks the police might be objecting to average speed cameras? Do they bear any cost for the cameras’ installation and maintenance? I should have thought that the cameras might make quite a bit of money for the speed camera authority. Do they involve any additional labour for the police that would incur cost? Why would the police be objecting to it?
Norman Baker
I hope I did not say that the police were objecting. I think I said that the police would be consulted, and we are working with the Highways Agency and Essex county council to determine the best way forward. If the police are objecting, my hon. Friend will have to pursue the matter with them. I suppose that, if I were to speculate, it would be that the police are concerned that speed cameras are put in places where they believe they would be most effective, and not in places where they believe the value of a speed camera would be diminished. However, that is pure speculation on my part. Their views will be sought as part of the activity in June involving the Highways Agency and Essex county council.
Mr Jenkin
I have yet to have a coherent explanation from Essex police as to why it is objecting to the speed cameras. There are other places on the road network where very similar problems occur, such as on the A14 and on an A road in Nottinghamshire, between Nottingham and Ollerton, where speed cameras have recently been installed at similar junctions and have dramatically reduced accident rates. I do not see what the problem is in principle about speed cameras on this stretch of road. The police seem to be objecting to that and have not given an explanation.
Norman Baker
The hon. Gentleman has put it on the record that the police have not given him an explanation. I am disappointed if that is the case. No doubt they will avidly follow this debate and will want to give him, as the local Member of Parliament, an explanation as to their views. I would hope that they would do so on the back of this debate, and that will help to inform future decision making about the road.
I have some sympathy with the hon. Gentleman’s suggestion that the long-term solution might be a roundabout. Roundabouts are proven to be safe constructions on the trunk road network. They also, of course, enable U-turns to be made without people having to travel long distances to alternative points on the network. There is an issue, I understand, about land acquisition, because clearly it has to be determined whether a roundabout could be constructed entirely within Highways Agency land or whether that would require the acquisition of other land, either voluntarily or through compulsory purchase.
Mr Jenkin
I can certainly confirm that any likely roundabout would involve the acquisition of private land, but I can also speak with reasonable authority on behalf of the landowners. They would be only too willing to contribute to a safe and practical solution to this junction, because they are local farmers and it affects the movement of their farm vehicles.
Norman Baker
That is also a helpful intervention, and again I will ensure that it is fed back to my ministerial colleague.
We expect an initial analysis of survey results to be available in July and we would want potential measures to be introduced as soon as possible later this summer. I share the view that if there is an accident problem in this area, which there is, and if the measures taken so far have not dealt with it, we do have a responsibility to try to find a way of dealing with the matter, because obviously people’s lives are at risk.
I conclude by again congratulating the hon. Gentleman on raising this important issue for his constituents. I confirm again that the Highways Agency is developing proposals to improve road safety at these junctions in both the short and the long term, taking account of the impact on local residents and businesses. I will specifically ask to make sure that his suggestions are factored in and properly evaluated as part of that process, and I hope very much that the steps that the Highways Agency ends up taking will benefit him and his constituents.
Drug-resistant Tuberculosis (Developing Countries)
(10 years, 11 months ago)
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Jim Fitzpatrick (Poplar and Limehouse) (Lab)
It is a pleasure to see you presiding in the Chair, Mr Caton. I will try to get through my remarks as quickly as possible, as a couple of other hon. Members would like to make a contribution and the Minister, whom it is good to see in her place, has very kindly indicated that she would be happy to hear them.
After making a few brief comments on tuberculosis and drug-resistant TB globally and in the UK, I will raise three important points that I hope the Minister will be able to address: support for the Global Fund to Fight AIDS, Tuberculosis and Malaria; investing in innovation; and the need for a national strategy in the UK to include an international target. However, before raising those issues, I would like to make a few observations.
The Minister recently met the all-party group on global tuberculosis to discuss its report, “Drug-Resistant Tuberculosis: Old Disease—New Threat”. Much of what I will speak about today is focused on the conclusion and recommendations of that report, which makes constructive recommendations that are evidence-based. I thank Mr Simon Logan, co-ordinator for the all-party group, for his assistance in preparing my remarks for today’s debate.
Tuberculosis in the UK reflects the global reality. TB is one of the world’s most common deadly infectious diseases. In the 1970s, my wife was a junior hospital doctor. Her consultant told her that by the time she became a consultant, TB would have disappeared, like polio, due to BCG, mass X-ray and drug treatment. How wrong can you be?
One third of the world’s population has latent TB, but only a small percentage goes on to develop the active form of the disease, which makes them sick and can kill if not treated. Unfortunately, little progress has been made towards eliminating TB in the UK—there are about 9,000 new cases each year—and global progress is painfully slow. The disease remains an urgent public health problem around the world, and we now face a new threat—drug-resistant strains that are significantly more expensive and difficult to treat. It should be said that both are curable, albeit with a long course of antibiotics. TB does not get the profile that the death and destruction it causes warrant. This is a serious issue, and we must do more to tackle it. It is not only a moral obligation; it is in our national interest.
The first line of defence against drug resistance is appropriate management of TB and the strengthening of the World Health Organisation’s standard treatment, called directly observed therapy, to prevent resistant strains from developing. However, we also need to take steps to tackle this threat head-on, as it is often airborne and can be passed from person to person in the same way as normal TB.
Rates of drug-resistant TB appear small in terms of the global burden of the disease, accounting for 440,000 of the almost 9 million new cases each year, but only about 10% have access to diagnosis, and the financial and treatment burden is substantial. The number of people affected is increasing and so is the cost. Patients have to take 15 to 20 tablets a day for up to two years to be cured of this more extreme form of the disease and they often experience horrible physical and psychological side effects as a result. It is also on the rise in the WHO European region, particularly in eastern Europe. Almost 80,000 cases occurred in the European region in 2011, accounting for nearly one quarter of all DR-TB cases worldwide.
The UK is not immune to this problem. London has the highest TB rate of any capital city in western Europe, and resistant strains of the disease have gradually but significantly increased since 2000. In my constituency, there are 61 cases of TB per 100,000 people. That is in Tower Hamlets. Neighbouring Newham, which I used to represent before the boundary changes in 2010, has double that amount, giving it the highest rate of TB in the UK. It is comparable to that in some high-TB-burden developing countries. To put that into context, the UK average is 14 cases per 100,000 people.
The threat that this public health concern presents to the UK recently led the chief medical officer for England, Dame Sally Davies, to warn that antimicrobial and infectious disease resistance poses a serious threat. One of her key recommendations was for the Government to campaign for it to be given a higher profile and priority internationally. In that regard, financing mechanisms such as the Global Fund to Fight AIDS, Tuberculosis and Malaria plays a crucial role in funding programmes for diagnosing and treating TB in low and middle-income countries. The global fund accounts for almost 90% of international TB funding. For many countries, there would not be a response to TB without the global fund’s support.
Sir Tony Cunningham (Workington) (Lab)
The hon. Member for South Derbyshire (Heather Wheeler) and I were on a visit to Ethiopia and visited St Peter’s hospital there. I asked what percentage of the funding for the drugs came from the global fund, and it is 100%—without it, people would die.
Jim Fitzpatrick
My hon. Friend reinforces the point that I have just made about how important the global fund is. As I am sure the Minister is aware, the global fund is asking donor Governments, such as the UK Government, for new funding in this replenishment year, and the UK Government have a crucial role to play in ensuring that that process is successful.
In the history of the fight against TB, there have been periods of urgency and periods of innovation, but only rarely have urgency and innovation come together. The rise of this new extreme form of the disease has given a new sense of urgency to global TB efforts, and after a decade of focused investment in TB innovation, we have a promising pipeline of new drugs, diagnostics and vaccines.
It is clear that to address rising rates of drug resistance, action is needed at national and international levels. The all-party group recently published its report, which was the culmination of more than six months’ work consulting world-leading experts on steps that the Government could take to help to address the increasing threat of drug-resistant TB. I shall highlight three key recommendations from the report, and I would be grateful if the Minister focused on those in her response.
Jim Shannon (Strangford) (DUP)
I thank the hon. Gentleman for bringing this important issue to Westminster Hall for debate. A group of children and young people from Swaziland were recently in my constituency. They were a Christian choir, and every one of those children had AIDS. In Swaziland, 40% of people have AIDS. Does he feel that we need to address such issues at the highest level? That choir is an example of what can happen when medication is available; if they can survive AIDS and TB, they can make a contribution to their country and ultimately across the world.
Jim Fitzpatrick
I agree with the hon. Gentleman, and I am sure that the Minister will repeat that agreement on the positive outcomes that result from appropriate treatment.
First, the report recommends that we strengthen the global fund by doubling the UK’s contribution. International donor funding, including the majority of the UK’s response to TB in developing countries, comes almost entirely through the global fund. In 22 high-TB-burden countries, six are totally reliant on the fund and in another 15 it accounts for two thirds of their budget. To scale up access and treatment for DR-TB, which remain woefully low, the resources the global fund has at its disposal need to increase. The Government have a key role to play in the replenishment of the fund, having been a key driving force behind the recent reforms it undertook. I commend the Government for that policy. What are their thoughts on our contribution to the fund to address the threat of TB and DR-TB? A lead from the UK should happen as soon as possible, to help leverage more from other donor Governments in this important replenishment year.
Secondly, the report recommends investment in innovation through TB REACH and continued investment in research and development. The Government have already shown leadership in support of developing new, badly needed tools to tackle TB—a policy of successive Governments that I hope will continue. Some of those tools have come to market, specifically new rapid diagnostics, but despite that, 3 million people each year still fail to access diagnosis and treatment for TB, which includes a large portion of people with drug-resistant strains. We need to accelerate our efforts to diagnose TB by rolling out new technologies, and it is clear that we need to think outside the box. TB REACH is one way to do that.
As the Minister knows, TB REACH is a Stop TB Partnership-hosted initiative that gives small grants of up to $1 million to find and treat those who do not have access to TB diagnosis or treatment. It is an incubator for innovation and pushes the frontiers of technology. It works closely with DFID-funded UNITAID. In short, TB REACH goes where others cannot and shows Governments and donors how to reach the unreachable. Critically, it often demonstrates with data what projects could be scaled up. The Minister may wish to express a view on whether she agrees with that assessment. Beyond their contribution of core funding to the Stop TB Partnership, which does not cover TB REACH, I ask that the Government become a donor to TB REACH, to maximise their investments in UNITAID and support the expansion of new diagnostic tools to detect and ultimately treat cases of TB, in addition to the work of the global fund. The funding allocated should be directed by the evaluation of the Stop TB Partnership later this year. I will be interested to hear her view on that recommendation.
Thirdly and finally, I want to mention a national strategy for TB in the UK and the importance of a global target within that. A national strategy for TB has never been developed, despite the public health risk the disease presents. The UK has seen rising rates of TB since the 1980s and DR-TB increased by 26% in the past year alone. I welcome that the Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry) indicated that her Department is supporting Public Health England to develop a strategy. I bumped into her before the Division and thanked her for her leadership on the matter, in which I have a constituency as well as a personal interest. I was recently invited to a seminar, organised by the Barts and Royal London TB unit, by Dr Veronica White, the consultant in respiratory medicine. Unsurprisingly, it is the biggest TB team in the UK and does sterling work locally and nationally.
With all that in mind and given the clear link between global and UK rates, will the Government set a specific target on their contribution internationally to tackling DR-TB as part of a comprehensive TB strategy, led by Public Health England?
Andrew George (St Ives) (LD)
I thank the hon. Gentleman for highlighting the all-party group on global tuberculosis, which it is my privilege to chair—I am not paid. Not only does the work on TB help to deliver the Government’s international development objectives, but it is also in Britain’s interest to get it right.
Jim Fitzpatrick
The hon. Gentleman makes a critical connection between our national interest and the international case, which the Minister and her team acknowledge. I am grateful that she is here. I look forward to her response. I thank her and her officials for the excellent work that they have been doing on this subject. I know that members of the all-party group are also grateful for the engagement that she and her team have had with them, and we look forward to it continuing.
Heather Wheeler (South Derbyshire) (Con)
It is a a pleasure to serve under your chairmanship, Mr Caton. I congratulate the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) on securing this important debate on the evil that is TB. I draw your attention, Mr Caton, to my declaration in the Register of Members’ Financial Interests. I want to make a short contribution today.
Earlier in the year, I was fortunate to visit Ethiopia, with my colleague the hon. Member for Workington (Sir Tony Cunningham), to study the changes that it had made to eradicate the scourge of TB, organised by the charity, RESULTS. Although I represent the leafy semi-rural seat of South Derbyshire, I became aware of the consequences of TB when a child at a neighbouring secondary school was diagnosed with it following a trip to see her extended family on the Indian subcontinent. What I saw in Ethiopia was frankly a success story, but a story based on years and years of diligent health care. We met Drs Amara and Abseno from St Peter’s hospital, who, having qualified as doctors 10 years ago, had given their professional life to that TB hospital on the outskirts of Addis Ababa. In other clinics, we saw that ordinary TB is being managed and now the next steps are to deal with the rising rates of DR-TB.
Outside of that specialist hospital, we visited the rural area of Awasa, where we saw the integrated Ethiopian Ministry of Health extension programme, which has been successful in delivering primary health care to communities, by training 36,000 health extension workers. That TB REACH programme has already doubled TB detection rates during a two-year period. I sincerely hope that our Government will consider joining the Canadian Government to fund existing and new programmes for case-finding and treatment in hard-to-reach populations. That is desperately needed: 90% of children in Addis Ababa are covered, but only 10% in the region of Afar are. Much has been achieved with our aid packages, but there is so much more to do. I hope that our Minister can respond positively.
Sir Tony Cunningham (Workington) (Lab)
I pay tribute to my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) for choosing a topic of huge significance and importance. I was delighted to be able to go to Ethiopia with the hon. Member for South Derbyshire (Heather Wheeler), whose work I pay tribute to. I was in Geneva at the global fund meeting with the right hon. Member for Arundel and South Downs (Nick Herbert), and I also pay tribute to his work in this field. The global fund is of huge importance. I do not want to spend time on it, because it has already been touched on, but I shall reiterate the question that we want the Minister to answer: what steps are the UK Government taking to support the future replenishment of the global fund in 2013? It is important because, as I said when I intervened, the entire budget of many of the hospitals dealing with TB comes from the global fund, so without it, they will have serious problems.
To put TB REACH, which the hon. Lady touched on, into context, of the estimated 9 million people who get ill with TB every year, 3 million go without proper diagnosis or treatment. Put simply, we fail to reach far too many people—often in the poorest and most vulnerable communities—with quality TB care. TB REACH offers a lifeline to the people in that missing 3 million. It is hugely important.
The hon. Lady mentioned the 36,000 health extension workers. The health extension programme in Ethiopia is successful for two reasons: the health extension workers are predominantly women and they are predominantly, or almost entirely, local. When we asked them, “What hours do you work?” they said, “We work nine to five, Monday to Friday, but everyone in the village knows where we live.” So they are available around the clock.
I want to give the Minister plenty of time to respond, so my final question is: does she agree that initiatives such as the one we visited in Ethiopia—the one that I have just mentioned—support innovative and effective techniques to find people with TB quickly, avert deaths and stop the disease spreading? I hope that such initiatives will be supported by this Government.
The Parliamentary Under-Secretary of State for International Development (Lynne Featherstone)
What a pleasure it is to serve under your chairmanship, Mr Caton. I congratulate the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) on securing this important and timely debate, and I thank him for having done so. I will try to get through all the points that have been raised, but if I do not we will contact hon. Members afterwards.
Tuberculosis is an age-old disease. It is tenacious and persistent, and affects the poorest people in the world and those who are socially marginalised. Every year there are 9 million new cases and nearly 1.4 million deaths. Although its incidence has been declining slowly since a peak in 2004, and mortality rates have fallen by 41% since 1990, the vast majority of TB deaths—more than 95%—are in the developing world.
Despite some progress, there were 400,000 cases of multi-drug resistant TB in 2011. As honourable colleagues will be aware, MDR-TB is more difficult and more expensive to treat than TB. Its spread is threatening the global response to TB, and makes TB control even more difficult. It is true, therefore, that TB continues to affect the poorest people in the poorest countries, and remains a serious threat to global health, especially through the rise of MDR-TB.
The coalition Government share the concerns about drug resistance, and we remain committed to the global goal of halving deaths from TB by 2015. The emergence of drug-resistant strains of tuberculosis poses a serious threat to the achievement of that goal and, indeed, to the effectiveness of our current armoury of medicines and treatments.
Our priorities for TB, and for MDR-TB, are to help to increase access to effective diagnosis and treatment of TB; to invest in research and product development in more effective treatment, diagnostics and vaccines; to support countries to strengthen health systems to deliver quality TB programmes—a really important point—and to work with our partners to tackle the risk factors for TB, including poverty and malnutrition. That is not always highlighted, and most of the work of the Department for International Development focuses on dealing with poverty and malnutrition.
As highlighted by the hon. Member for Poplar and Limehouse, Public Health England is developing a national strategy for TB, and engaging with key partners such as local government, the National Institute for Health and Care Excellence, NHS England, academia, the voluntary sector and the Department of Health. DFID will obviously input into the process, and will work with the partners on their strategy, to produce national and international policy and to ensure that there is co-ordinated action on domestic and global approaches to reducing rates of TB.
Our first priority is to improve basic TB control. Basic control includes early detection and diagnosis, effective and complete treatment, and contact tracing. Basic control is also critical in preventing the further spread of drug-resistant tuberculosis. If we do not deal with basic TB, the incidence of MDR-TB will be accelerated. We also help to strengthen all aspects of TB control through direct and indirect funding channels in a range of high-burden countries.
I will quickly give three examples. We are working with the Government of South Africa to expand the quality of and access to public sector services, including that of TB control, and are increasing the speed with which new TB drugs get registered. We have engaged in a new partnership with the private sector in South Africa and the World Bank that aims to reduce TB in mining communities, which I think will be welcomed on both sides of the House.
In India, DFID is working with Indian pharmaceutical manufacturers to improve the price and security of supply of high-quality drugs for resistant TB and the manufacture of new low-cost diagnostic products. In Burma, we are providing bilateral funding to the 3MDG fund, a multi-donor fund for the health sector, which is supporting disease control among the poorest communities.
Nick Herbert (Arundel and South Downs) (Con)
I, too, am a member of the all-party group on global tuberculosis, and I visited South Africa recently with Lord Fowler. Is that country not a good example of the problem of drug-resistant TB? A full third of the budget that South Africa has to deploy in dealing with TB is spent on drug-resistant TB, yet the incidence of such TB is only 2%. That underlines the importance of getting on top of that form of TB so that the costs do not run further out of control and undermine the fight against the disease.
Lynne Featherstone
My right hon. Friend makes an excellent point. South Africa is an epicentre, so far as its spend on what is a relatively confined industry is concerned.
I was talking about Burma. It is estimated that between 2013 and 2016, the 3MDG fund will spend $20 million on tuberculosis. Funding is an important strand. DFID also supports a number of global partnerships that work on strengthening basic TB control. For example, the Stop TB Partnership plays a critical role in helping countries to strengthen their TB policies, and in supporting the improvement of funding applications for large TB-control grants.
The UK’s contribution to UNITAID, of up to €60 million per year, has funded new laboratory infrastructure in 18 countries, 10 of which now routinely diagnose MDR-TB. The network will have detected approximately 12,000 MDR-TB cases by the end of 2011, compared with only 2,300 cases in the same countries in 2008.
I will move on to the Global Fund to Fight AIDS, Tuberculosis and Malaria, because I know it is of particular interest—this is not the first occasion on which it has been raised with me. The majority of UK funding to global TB control is channelled through the Global Fund to Fight AIDS, Tuberculosis and Malaria, and we have increased and accelerated our funding and are on track to meet our £1 billion commitment to the fund for 2008 to 2015. The fund is, as hon. Members have mentioned, absolutely critical to achieving many of the UK’s health-related international development objectives, so it is important to us that it continue to deliver ever-more impressive results. The UK intends to increase its contribution, pending, as we have said, progress on the implementation of crucial reforms. That obviously falls within my portfolio, and I have had reports from all DFID offices around the world, having asked them to report to me on the fund. Recently I was in Nigeria and had a meeting with recipients of global funding from across the three diseases, to understand the changes that are being heralded in with the reforms at the global fund—so far so good.
We are committed to working with others to ensure that the planned autumn replenishment is a success. We are a world leader, but sometimes it would be nice to be at least equalled in some of these things by other donor countries. We will use our influence to draw in more overall financing. I understand the call to go early, but there are many multinational decisions to be made and, as I have said, this all depends on progress.
On investment in research and innovation, which I think all Members would agree is critical, DFID has a strong record of supporting research and development for effective treatments, diagnostics and vaccines. An example of that is our effort to increase the affordability of diagnostic testing for MDR-TB. DFID’s support of the Foundation for Innovative New Diagnostics has contributed to the development of a rapid molecular test, GeneXpert, which has the potential substantially to improve the diagnosis of TB and drug-resistant TB.
DFID aims to continue our strong record of supporting investment in TB research and development, including through product development partnerships, and we will strive for value for money in such investments. On DFID’s support for innovation, we will consider the hon. Gentleman’s request that we fund TB REACH against, obviously, the competing priorities and commitments in our international health financing decisions.
Sir Tony Cunningham
Will the Minister recognise the importance of TB REACH? We can have all the drugs in the world, but if we cannot find the people with TB, we cannot use those drugs.
Lynne Featherstone
Absolutely. The point is that we are waiting for the evaluation. TB REACH worked by giving a small amount to a great number of organisations to test how to reach people in difficult circumstances. It had precise pre-specified targets and cost-effectiveness benchmarks, and we have to await the evaluation of that first phase to assess what our funding might be for the second phase. We cannot go ahead of that, although I understand that reaching people is critical. We should also work to strengthen health systems, because ultimately we want health systems that are able to reach every individual in a country and dispense whatever medical care is necessary, but I understand the point in relation to TB.
On Ethiopia, about which I have not yet responded, DFID provides significant support to its health system, directly supporting community health workers, and we agree that they do a great job, including on TB. I have been to Ethiopia myself—twice, in fact.
In conclusion, I am very proud to serve in the coalition Government who, even in tough times, have protected the development budget and will reach the target of 0.7% of gross national income this year. I am also proud that we have cross-party consensus in this Parliament: it is one of our finer moments. We are equally clear about the responsibilities that come with those resources, particularly when this country is itself struggling for survival. Those responsibilities are to spend taxpayers’ money well, to deliver aid that is accounted for transparently, and to ensure that our support delivers value for money and gets to where it is most needed.
Significant progress has been made in controlling TB since 1995, with more than 51 million cases treated and 20 million lives saved. That progress was rooted in improved partnership, policy, innovation and leadership, so there is cause for optimism. I thank all hon. Members here, because the issue is really important and I appreciate their continued pressure. The issue needs to be worked on in all the ways they have proposed if we are to get the better of this disease: our progress is good, but not remarkable. The UK is playing its part, but as I have said, we are all clear that significant challenges remain.
Question put and agreed to.
Written Ministerial Statements
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Stamp Duty Land Tax (Avoidance Scheme)
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The Exchequer Secretary to the Treasury (Mr David Gauke)
The Government are today tabling an amendment to Finance Bill 2013 to put beyond doubt that a particular stamp duty land tax (SDLT) avoidance scheme is ineffective. The scheme uses the SDLT transfer of rights rules to avoid SDLT on the purchase of UK land. The legislation will have effect from 21 March 2012.
Because of repeated avoidance in this area, at Budget 2012 the Chancellor of the Exchequer made it clear that he would not hesitate to use retrospective legislation to close down future SDLT avoidance schemes.
Acting on this warning it was announced at Budget 2013 that legislation will be introduced in the Finance Bill to close down two schemes, which use the transfer of rights rules, with effect from the date of the Chancellor’s warning, 21 March 2012.
Since then a further transfer of rights scheme has been identified. The Government do not accept that the scheme has the effect intended but to remove any doubt, prompt action is being taken to protect the Exchequer.
Given the Chancellor’s clear warning last year and the announcement at Budget 2013 of retrospective legislation to close down similar transfer of rights schemes, if should have been obvious to both promoters and users of this scheme that it could be subject to retrospective action.
An updated tax information and impact note and guidance note are available on the HMRC website.
Women's Business Council
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The Secretary of State for Culture, Media and Sport (Maria Miller)
The Women’s Business Council was set up in 2012 to advise Government on how women’s contribution to economic growth could be optimised. I am delighted that they have today published their findings. I would like to thank each of them for their hard work and for the constructive approach they have taken.
The Council’s report clearly demonstrates the importance of ensuring that women are fully able to contribute to the economy of this country. We cannot afford to ignore the additional contribution that women could make, if the barriers to their full participation in the economy could be resolved. This is not just an equality issue; it is a very important economic issue.
The Council has made a series of recommendations for action, by Government and by business, focusing on areas where the economic case for action is clearest.
The Government welcome the recommendations. I am pleased that in many cases the recommendations for Government endorse the Government’s current approach, while suggesting ways to go further.
I can announce today that I will be chairing a ministerial taskforce to drive forward the implementation of these. The taskforce will have a clear focus on economic growth, with Ministers from all the relevant Departments. The taskforce will have its first meeting shortly and will publish a detailed action plan in the autumn.
In the meantime, I am publishing today the Government’s initial response to the council’s recommendations, which details a series of early actions which will start to make a real difference to women’s lives, in each of the four key areas identified for action by the council. These measures will:
broaden girls’ aspirations and help inform their choices at the start of their careers, including encouraging more girls to study science, technology, engineering and maths, and to consider jobs in these areas;
help business culture embrace the benefits of flexible working and support working parents in the second part of their working lives;
ensure that women in the third part of their working lives can utilise their skills and fully contribute to economic growth; and
ensure that women are better supported to set up their own businesses.
Telecommunications Council
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The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)
The Telecommunications Council will take place in Luxemburg on 6 June 2013. I will represent the UK at this Council.
The first item is a full “tour de table” debate guided by questions from the presidency on the digital agenda for Europe—the role of the telecommunications and ICT sectors. The Commissioner for the digital agenda, Vice President Kroes is planning to launch an initiative with the aim of achieving the goal of a further integrated European telecoms single market. It forms part of the goal to achieve a pan-European digital single market by 2015; though the telecoms single market measures may have a longer timescale before realisation. This new initiative will include legislative measures and we are expecting the outcomes of this debate to inform this package of measures which will be adopted by the Commission before the summer. This package will in turn contribute to the debate at the European Council in October which will focus on digital and innovation issues. We have had initial discussions with the Commission on this initiative.
This debate will focus on two questions: garnering member states’s views on how to realise the ambition of a more integrated telecoms single market and how to realise further pan-European spectrum harmonisation. My intervention will note that while the UK welcomes the idea of a further integrated single market in telecoms in principle, we will need to see the details of the initiative first, before we comment in any detail. I will also state that any proposals will need to strike the right balance between allowing consolidation in the telecoms market but still ensuring that there is vibrant competition.
The next is a progress report from the presidency, followed by an orientation debate on the proposal for a directive of the European Parliament and of the Council concerning measures to ensure a high level of network and information security across the Union. (First Reading—EM6342/13) My intervention will include that we welcome the Commission’s overarching ambition to raise cyber capabilities across the EU and that we will work with Commission and other member states to ensure that any potential legislative measures are aligned. Further, that they do not place disproportionate burdens on businesses or the public sector operating in the EU or create the wrong incentives for sharing information.
The presidency will then provide a progress report on the proposal for a regulation of the European Parliament and of the Council on electronic identification and trust services for electronic transactions in the internal market (First Reading—EM10977/12). The UK does not currently foresee the need to intervene on this item.
The Council will then look at two proposals under the “banner” of digital infrastructure and services. The first item looks at the proposal for a regulation of the European Parliament and of the Council on guidelines for trans-European telecommunications networks and repealing decision No 1336/97/EC (First Reading—EM16006/11). The UK does not currently foresee the need to intervene on this item.
The second item is a progress report on the proposal for a regulation of the European Parliament and of the Council on measures to reduce the costs of deploying high-speed electronic communications networks (First Reading—EM7999/13). If there is a debate, the UK will say that while we strongly support the Commission’s overall objective to support broadband rollout by reducing the cost of deployment, we do not support the use of a regulation to achieve this.
There then follows a progress report on the proposal for a directive of the European Parliament and the Council on the accessibility of public sector bodies’ websites, (First Reading—EMI7344/12), which was published on 4 December 2012. The UK does not currently foresee the need to intervene on this item.
Any Other Business
Finally, the Lithuanian delegation will inform the Council of their priorities for their forthcoming presidency. We do not currently foresee the need to intervene on this item.
Afghanistan
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The Secretary of State for Defence (Mr Philip Hammond)
As our presence in Afghanistan reduces, our requirement for the support of local staff is also reducing. The Government recognise the contribution and commitment of all local staff. They have played a vital role in contributing to our shared goal—a more secure, stable and prosperous Afghanistan. Without them, the UK’s contribution to the international mission would not have been possible. We pay tribute to those who have made the ultimate sacrifice and those who have been injured while working with us.
The future of Afghanistan lies in the hearts and minds of such people, who have done so much to move their country forward. Having invested so much already, the Government want to encourage local staff to stay in Afghanistan and to use their skills and knowledge to make it stronger, better able to meet the challenges ahead and to seize the opportunities.
For this reason, we have decided to implement a generous package of training and financial support for our locally engaged staff in Afghanistan. It will provide local staff with up to five years of training or education in Afghanistan in a subject of their own choosing and a living stipend for the full period of training based on their final salary. Staff who prefer not to take up the training package will be offered a second option—a financial severance payment which represents 18 months’ salary. This will be paid in monthly instalments. These options aim to encourage local staff to develop valuable skills and knowledge in Afghanistan so they can go on contributing to a brighter future for themselves, their families and their country.
The Government acknowledge that some local staff, such as interpreters, have worked in particularly dangerous and challenging roles in Helmand. In recognition of this unique and exceptional service to the United Kingdom, these local staff and their immediate families will be offered a third option—resettlement in the UK. In order to help them adjust to life in the UK, they will be offered initial assistance and accommodation including access to benefits, as well as support in seeking employment.
To be eligible for resettlement in the UK, local staff must have routinely worked in dangerous and challenging roles in Helmand outside protected bases. Seriously injured staff, who might have qualified had their employment not been terminated due to injuries sustained in combat, are also included. Local staff who were contracted by the UK, but who mostly worked for Danish or Estonian forces and who meet the criteria above, are also eligible. This approach has been agreed with the Danish and Estonian Governments.
We have always been clear in our desire to recognise the efforts of local staff, and have balanced this against a range of other factors. These include the cost of any scheme, and the potential impact on the UK and on Afghanistan of resettling large numbers of people. In line with previous similar policies, qualification for this redundancy scheme is limited to those local staff who were in post working directly for HMG on 19 December 2012, when the Prime Minister announced the drawdown of UK forces, and who have served more than 12 months when they are made redundant. Those whose employment ended before this date, and those whose employment was ended voluntarily or for disciplinary reasons will not be eligible. In total, we estimate that around 1,200 local staff will qualify for a redundancy package. Of these, we estimate that up to 600 will be eligible for resettlement, although they may choose to stay in Afghanistan to help build its future, supported by the training and financial packages.
Further details of the practical arrangements for applying for and implementing the redundancy scheme will be announced in due course.
Separately from the redundancy package, we recognise our obligations to any local staff who face real threats to their safety or that of their immediate family as a result of their service to the UK. Our existing intimidation policy will remain in place for all local staff, regardless of their date and duration of employment. This ensures that local staff who face real threats to their own and their families’ safety, now and in the future, are supported. The policy offers relocation within Afghanistan and, in the most extreme cases, the possibility of resettlement in the UK. We are currently reviewing the policy to ensure it continues to provide a fair and robust system of assessing threats to, and ensuring the protection of, our local staff.
The UK is strongly committed to the future of Afghanistan and will maintain a long-term relationship based around trade, diplomacy, development assistance, financial contribution to the Afghanistan national security forces and military training. Our future work in Afghanistan will continue to benefit from the talent and dedication of local staff, and we will never forget this.
School Funding Reforms
(10 years, 11 months ago)
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The Minister for Schools (Mr David Laws)
Schools across the country are unfairly funded as a result of an historic and out-of-date system. In March last year, the Secretary of State confirmed that we would rectify these injustices with a new national funding formula, it will be introduced during the next spending review period. The Secretary of State also announced a number of changes to the school funding system to pave the way for a national funding formula. These changes took effect from April 2013.
This started a welcome journey towards a fairer and more transparent funding system, but following consultation with the sector a number of improvements to the initial arrangements need to be made.
The Department carried out a review to understand how the changes introduced in April 2013 have been implemented. We published a document on 12 February seeking views from our partners, and officials also undertook fieldwork in 11 local authorities spread across the country.
We are grateful to the many MPs, head teachers, governors, local authority officers and parents who have taken the time to contribute as part of the review.
Today we are publishing a document which sets out the changes we will be making to school funding arrangements in light of the findings from the review.
In order to maintain momentum towards a national funding formula, we will ensure that more money is targeted to pupils. We will require local authorities to allocate a minimum of 80% of their funding on the basis of pupil characteristics and we will also be setting a minimum amount that each pupil should receive.
In our consultation there was concern about the ability of local authorities to support small schools in rural areas. From April 2014, therefore, we will enable local authorities to provide additional funding for schools in sparsely populated areas.
The document also sets out new flexibilities to provide different amounts of funding to cover the fixed costs of primary and secondary (as well as middle and all-through) schools. These new flexibilities will ensure local authorities can act to take account of varying fixed costs between different types of school. Schools that merge will also be able to keep some of their funding for fixed costs for at least the first year.
We will continue to target support on deprived and vulnerable pupils. Local authorities will be required to target additional funding to deprived pupils in addition to the pupil premium. We are also making changes to ensure that those pupils who are less likely to attain well at the end of the primary or secondary phase are identified and attract additional funding.
We also want to encourage local authorities to provide the right level of additional funding for schools to enable them to support looked-after children, regardless of how long the child has been in care.
We made significant changes to the funding arrangements for pupils with special educational needs last year so we are not making any further substantial changes in 2014. We are, though, intending to require all local authorities to provide notional SEN budgets to their schools on the basis that the school will meet the costs of the first £6,000 of additional support required by a pupil with SEN.
In the document we are publishing today, we are providing the detailed findings from the review, the approach which will be put in place from April 2014 and technical guidance on this for local authorities. Copies of these documents will be placed on the Libraries of both Houses.
Taken together, these changes will further strengthen our funding reforms and will help us move towards our aim of ensuring that pupils attract a more consistent amount of funding wherever they go to school in the country.
EU Energy Council
(10 years, 11 months ago)
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The Minister of State, Department of Energy and Climate Change (Michael Fallon)
In advance of the forthcoming Energy Council in Luxembourg on 7 June, I am writing to outline the agenda items to be discussed.
The presidency is planning to give a progress report on negotiations of the draft directive amending directives relating to the quality of petrol and diesel fuels and on the promotion of the use of energy from renewable sources. The draft directive seeks to address indirect land use change (ILUC) emissions and encourage the transition to advanced biofuels. The presidency has put forward amended proposals but there are still divided views in the Council on them. The UK supports the introduction of ILUC factors into the amended directives and is concerned that the present proposals do not go far enough to address ILUC factors.
The Council is then expected to agree conclusions on the Commission communication on the internal energy market, which was published on 16 November 2012. We are content with the text of the conclusions, which sets out measures for strengthening and developing the internal energy market. We also expect the presidency to report on the outcome of the May European Council but no discussion is envisaged.
There will be a debate on the Commission’s recent communication on energy technologies, which outlines the need for better and cheaper low-carbon energy technologies to be developed faster to help reduce the costs of achieving the EU’s energy-related policy goals up to 2050. The UK welcomes the communication and supports most of the Commission’s messages.
The presidency and Commission will present a report on a number of international energy relations items, including EU-Russia, the International Energy Agency, the clean energy ministerial, the southern corridor, and an EU-Algeria memorandum of understanding on energy.
Finally, the Lithuanian delegation will present the programme for their presidency.
EU 2030 Climate and Energy Framework
(10 years, 11 months ago)
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The Secretary of State for Energy and Climate Change (Mr Edward Davey)
Earlier this year, the European Commission adopted a Green Paper on “A 2030 framework for climate and energy policies”. The Government will be responding to the Commission consultation to set out how we believe the 2030 framework should look in order to give businesses the certainty they need to invest in low carbon to enable cost-effective emissions reduction and to ensure the EU remains a world leader in low-carbon technologies. The UK Government position on the EU 2030 framework is:
We strongly support EU action to tackle climate change and to help deliver the EU’s goal of limiting global temperature rise to 2 degrees. We remain committed to an increase in the EU climate target for 2020 to 30% and are pushing strongly for urgent structural reform of the EU emissions trading system (ETS) to ensure it continues to incentivise investment in low carbon.
We must celebrate the success of the 2020 climate and energy package. By 2011 EU emissions were already down 17.6% on 1990 levels (Reference: European Environment Agency).
But we should also learn the lessons from 2008 package—the EU climate deal for 2020 was not sufficiently ambitious, and the renewables target was the product of a time when renewables badly needed a catalyst. The EU has moved on since then; we need to see a new deal on greenhouse gas targets that is ambitious, but which has flexibility to let countries follow their most cost-effective decarbonisation approach.
Looking to 2030, the EU should adopt a unilateral EU target for 2030 of a 40% reduction on 1990 levels. In the context of an ambitious global climate agreement for the period beyond 2020, the EU’s target should increase to up to a 50% reduction on 1990 levels.
We believe that the best way to deliver our low-carbon goal is through a binding GHG target and a strong EU emissions trading system, with flexibility for member states to pursue a wide range of options to decarbonise in the least cost way. While we strongly support renewables to 2020 and beyond, we do not believe a binding EU renewables target would be cost-effective, fit well with our electricity market reforms which incentivise low-carbon generation in a technology-neutral way, or be in line with the Government’s commitment to sector-neutral and least-cost emissions reduction. We support EU action where appropriate to enable increased levels of renewables, such as a renewed focus on research and development under the strategic energy technologies plan and ongoing work to complete the single energy market.
I will be working closely with my EU partners over the coming months to try to ensure that the EU can at the earliest opportunity agree an ambitious but flexible 2030 climate and energy framework.
Food Supply Networks
(10 years, 11 months ago)
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The Secretary of State for Environment, Food and Rural Affairs (Mr Owen Paterson)
I would like to announce to the House that my right hon. Friend the Secretary of State for Health and I have asked Professor Chris Elliott, of Queen’s University Belfast, to lead an independent review into the integrity and assurance of food supply networks in response to the vulnerabilities recently exposed by horsemeat fraud. I am pleased that he has accepted, subject to the necessary formalities being concluded with Queen’s University Belfast.
On 15 April 2013, Official Report, column 13WS, the House was informed that it was our intention to take forward a strategic review of the horsemeat incident and its implications for the food chain and regulatory framework. We have since concluded that the review should examine food supply networks more widely. We have therefore asked Professor Elliott to provide advice to me and my right hon. Friend on issues which impact upon consumer confidence in the authenticity of food products and any systemic failures in food supply networks which could have implications for food safety and public health. We expect him to make recommendations to support improvements in current systems and to improve consumer confidence.
The review will begin shortly and I anticipate it will take nine to 12 months to complete. My right hon. Friend and I have asked for interim advice in December and for a final report by spring 2014. We have also asked Professor Elliott to provide emerging findings on the European aspects of the review so that we can continue to influence action at a European level and effectively engage in the European Union process.
The reviewer will in due course issue a call for evidence seeking information and views on the integrity of the food supply network, any vulnerabilities and how assurances might be strengthened to support consumer confidence. Food fraud is completely unacceptable and consumers have every right to expect their food to be correctly described. In response to horsemeat fraud, investigations continue at a number of sites across the UK and Europe.
In April, the Board of the Food Standards Agency commissioned Professor Pat Troop to conduct an independent review of that organisation’s response to horsemeat fraud. Professor Troop will be reporting her emerging findings to the board of the Food Standards Agency at its open meeting later today. My right hon. Friend and I expect any strategic findings from the Pat Troop review to be considered in our joint review into the integrity and assurance of food supply networks.
The terms of reference for the review into the integrity and assurance of food supply networks are being placed in the House Library.
Foreign Affairs/Development Foreign Affairs Councils
(10 years, 11 months ago)
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The Minister for Europe (Mr David Lidington)
My right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs attended the Foreign Affairs Council (FAC) on 27 May and my right hon. Friend the Secretary of State for International Development attended the Development Foreign Affairs Council in Brussels on 28 May. The FAC and Development FAC were chaired by the High Representative of the European Union for Foreign Affairs and Security Policy, Baroness Ashton of Upholland.
Commissioners Damanaki (Maritime Affairs and Fisheries), Georgieva (International Cooperation, Humanitarian Aid and Crisis Response), Potocnik (Environment), Füle (Enlargement) and Piebalgs (Development) were in attendance for some of the discussions at the FAC and Development FAC.
A provisional report of the meetings and conclusions adopted can be found at: http://www.consilium.europa.eu/ uedocs/cms_Data/docs/pressdata/EN/foraff/137317.pdf.
Foreign Affairs Council
Syria
Ministers agreed conclusions that focused on reiterating the EU’s concern at the situation in Syria especially the humanitarian crisis, highlighting the EU’s support for progress in Geneva based on the principles of the 2012 Geneva communiqué, support for the Syrian opposition and the Istanbul meeting, and post-conflict planning.
Ministers agreed that a Council decision putting in place the sanctions package for the next 12 months would be adopted before the existing sanctions expired on 1 June. Ministers agreed to end the EU arms embargo and return decisions on arms provision to the member states. They agreed a framework of safeguards to guide those member states who might decide to provide arms: arms can only be sent to the Syrian national coalition for opposition and revolutionary forces, and must be intended for the protection of civilians; member states must require safeguards that ensure delivery to the intended recipients; and Ministers confirmed that existing obligations under the EU common position for arms exports remain in place. Member states said they would not proceed at this stage with deliveries of arms, in order to give time for the Geneva II process to succeed. Separately from this, ministers also agreed to review the Council position on the arms embargo before 1 August, on the basis of a report from the high representative.
Common Security and Defence Policy (CSDP)
Ministers discussed preparations for the December European Council discussion on defence. Baroness Ashton highlighted the need to spend national defence budgets more effectively in order to develop key military capabilities and strengthen Europe’s defence industry. Baroness Ashton stressed that implementation of the EU’s comprehensive approach was key to a successful CSDP and that the EU needed to improve its civilian missions. There was widespread support from Ministers for Germany’s recent non-paper on civilian CSDP, of which the UK is a co-signatory, with an emphasis on improving mission planning, speed of deployment and access to funding. Other member states also raised maritime security, cyber security, the need for CSDP to complement NATO, the utility of regional approaches to European capability development, the EU’s role in the western Balkans and the timing of Baroness Ashton’s report on EU CSDP.
Middle East Peace Process
The planned discussion on the middle east peace process was postponed until the June FAC.
Iran E3+3
Baroness Ashton updated Ministers on her meeting with the Iranian chief negotiator Jalili in Istanbul on 15 May where Baroness Ashton had stressed that Iran needed to consider seriously the E3+3’s confidence building measures.
Mali
Baroness Ashton briefed Ministers on the high-level donors’ conference on Mali which took place in Brussels on 15 May. More than €3.25 billion had been pledged, including €520 million from the EU. Baroness Ashton said that progress was being made on the political front and that preparations for the handover from African-led International Support Mission to Mali (AFISMA) to the UN were going well. Ministers agreed conclusions that confirmed the importance of the political process and national reconciliation.
Somalia
Baroness Ashton welcomed the Somalia conference held in London on 7 May which had demonstrated strong international support for Somalia. The Foreign Secretary noted that the London conference had served as good preparation for the EU Somalia conference to be held 16 September. The Foreign Secretary highlighted the €350 million in new pledges made at the London conference and stressed the need for this to be delivered quickly to improve Somalia’s justice systems, police, armed forces and public financial management.
Serbia/Kosovo
Baroness Ashton reported back on her 21-22 May meeting with the Prime Ministers of Serbia and Kosovo, which had agreed an implementation plan following the 19 April agreement on northern Kosovo. Baroness Ashton informed Ministers that the implementation plan had now been approved in both capitals. Rapid implementation of the agreement was needed ahead of discussions in the June General Affairs Council and European Council, which will include consideration of a date for the opening of accession negotiations with Serbia.
Other business
Ministers agreed without discussion a number of other measures, including:
The Council authorised member states to sign the arms trade treaty with respect to matters falling under the exclusive competence of the Union. It encouraged member states to sign the arms trade treaty at the solemn ceremony in New York on 3 June or at the earliest possible date.
The Council amended legislation implementing the EU restrictive measures in view of the situation in Libya. Changes were made to take account of modifications adopted by the UN Security Council.
The Council extended the EU police mission in Afghanistan until 31 December 2014.
The Council allocated a budget of €110 million to the EU rule of law mission in Kosovo to cover the period from 15 June 2013 until 14 June 2014.
The Council noted the comprehensive annual report on CSDP and CSDP-related training 2012, and approved its conclusions as a basis for further actions to improve training in the field of CSDP.
The Council authorised the opening of negotiations with Libya for an agreement on the status of the EU integrated border management assistance mission in Libya (EUBAM Libya).
The Council took note of the third report on member states’ progress in facilitating the deployment of civilian personnel to CSDP missions.
The Council approved an administrative arrangement between the European Defence Agency (EDA) and the Ministry of Defence of the Republic of Serbia, with a view to its conclusion by the EDA steering board. The arrangement sets out procedures for a mutual exchange of information as well as for Serbia’s participation in EDA projects and programmes.
Development Foreign Affairs Council
Post-2015 agenda
Ministers endorsed conclusions on the overarching post-2015 agenda that set out the high-level EU position on preparations for a future framework in advance of the September millennium development goals review event. Ministers agreed that the post-2015 and Rio+20 follow-up processes should converge. The International Development Secretary said it was vital that the EU send a clear message on the need for an integrated agenda leading to one set of goals, while remaining flexible in international negotiations to the positions of partner countries on the detail. The conclusions will now proceed to the EU Environment Council on 18 June and be considered for adoption at the General Affairs Council on 16 June.
Agenda for Change
Commissioner Piebalgs introduced a Commission/ EEAS paper updating member states on progress on implementation of the EU aid reform programme set out in the “Agenda for Change”, and reiterated his conviction as to its core principles. Joint programming and demonstrating results were particularly important, as well as blending grants and loans to leverage more money for partner countries.
Ministers welcomed the opportunity to scrutinise progress at a political level and many were positive about joint programming. The International Development Secretary called for more action on the results framework so the EU could better demonstrate value for money, and for more information on progress on gender equality, empowerment of women and private sector development.
Food and nutrition security
Ministers agreed conclusions on food and nutrition security in external assistance setting out a new EU policy framework to enhance maternal and child nutrition and a new EU implementation plan. The Irish presidency noted the important work being done by the UK through the G8 presidency and encouraged the EU and member states to support the UK’s “Nutrition for Growth” event on 8 June.
2012 Official Development Assistance (PDA) Targets
Ministers adopted conclusions on the annual report 2013 to the European Council on EU development aid targets. Commissioner Piebalgs said it revealed a worrying trend and urged member states to take the necessary steps to meet the 0.7% ODA commitment. This was not just about charity but investment from which the EU would benefit in terms of security, immigration and job creation.
European Development Fund
The Council established the EU position on the financial protocol concerning the 11th European Development Fund for 2014 to 2020. In total, €31.5 billion will be available for African, Caribbean and Pacific (ACP) states in that period. Ministers also noted that Somalia had acceded to the ACP-EU partnership (Cotonou) agreement.
The EU approach to resilience
Ministers agreed conclusions on the EU approach to resilience setting out guiding principles and priorities for implementation.
Other business
The International Development Secretary briefed Ministers on UK G8 presidency priorities, including forthcoming events on trade, tax and transparency, the “Nutrition for Growth” event being co-hosted with Brazil and the leaders’ summit at Lough Erne. The UK and France had recently signed up to the extractive industries transparency initiative. The Minister also gave an update on the work of the global partnership, which was well placed to support the EU’s efforts on post-2015.
The meeting ended with an informal lunch with UN Deputy Secretary-General Jan Eliasson where discussion focused on the post-2015 agenda.
CCTV and Surveillance Camera Technology
(10 years, 11 months ago)
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The Parliamentary Under-Secretary of State for the Home Department (James Brokenshire)
My hon. Friend the Minister for Criminal Information, Lord Taylor of Holbeach, has today made the following written ministerial statement:
The Government favour the use of CCTV and automatic number plate recognition (ANPR) systems as a crime fighting and public protection tool. They support the use of overt surveillance in a public place when it is in pursuit of a legitimate aim; necessary to meet a pressing need; and proportionate, effective, and compliant with any relevant legal obligations.
Like the public, the Government expect that where CCTV is deployed it is as effective as it can be in meeting its stated purpose and has appropriate privacy safeguards.
The public must, however, have confidence that such surveillance is appropriate and proportionate, and that those who operate the camera systems, or use the images and information they capture, demonstrate integrity in so doing and can be held to account.
This is why the Protection of Freedoms Act 2012 now requires the Government to put in place a regulatory framework for surveillance camera systems comprising a code of practice and a surveillance camera commissioner. The appointment of Mr Andrew Rennison as surveillance camera commissioner was announced in a written statement on 13 September 2012, Official Report, column 14WS.
On 7 February 2013, I issued a written statement to the House announcing arrangements for a period of statutory consultation in relation to the preparation of the code of practice required under section 29 of the Protection of Freedoms Act 2012 for the regulation of surveillance camera systems (the code).
We have now given careful consideration to the 134 submissions made in response to that consultation exercise, and are today publishing the Government response. Our response summarises comments and views expressed about the preparation of the code and about the position of the three non-territorial police forces and the Serious Organised Crime Agency in relation to the code. It also provides detail about further amendments made to the code in the light of consultation and says more about plans for implementation and review of the code once it is brought into force.
The code is being laid before Parliament today, along with the necessary draft affirmative order to bring it into force. Copies will be available in the Printed Paper Office.
This code provides a single source of bespoke guidance and is intended to increase understanding of existing legal obligations in relation to the overt use of surveillance camera systems in public places, and to promote good practice—particularly in encouraging: regular reviews of whether use remains justified; greater transparency, and; the effective use of a system in meeting its stated purpose through working to relevant standards.
The draft code also establishes a framework within which the surveillance camera commissioner can fulfil his statutory functions and publicise how this will be done, while retaining some flexibility to enable him to influence and respond to future developments in surveillance camera technology and practice.
A copy of the Government response to consultation will be placed in the House Library.