Draft Regulatory Enforcement and Sanctions Act 2008 (Amendment to Schedule 3) (England) Order 2021
(2 years, 12 months ago)
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The Chair
Before we begin, I remind Members that they are expected to wear face coverings and to maintain distancing as far as possible. That is in line with current Government guidance and that of the House of Commons Commission. Please give each other and members of staff space when seated, and when entering and leaving the room. I remind Members that they are asked by the House to have a covid lateral flow test twice a week if coming on to the parliamentary estate. That can be done either at the testing centre in Parliament or at home. Ministers and Members should send their speaking notes by email to hansardnotes@parliament.uk. Similarly, officials in the Gallery should communicate electronically with Ministers.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
I beg to move,
That the Committee has considered the draft Regulatory Enforcement and Sanctions Act 2008 (Amendment to Schedule 3) (England) Order 2021.
It is a pleasure to serve under your chairmanship, Dame Angela. We know the importance of helping businesses to prepare for and efficiently respond to a public health emergency, and the point of the order is to help businesses in that way in the event of a future public health emergency. Key to that will be reducing regulatory burdens imposed on businesses due to regulations introduced to control the public health emergency. The order adds
“Public Health (Control of Disease) Act 1984 (c.22), Part 2A as it applies in England”
to schedule 3 to the Regulatory Enforcement and Sanctions Act 2008. It brings part 2A, and regulations made under part 2A as they apply in England, within the scope of the primary authority scheme. As a result, businesses in England that participate in the primary authority scheme will now be able to receive consistent advice on meeting the regulatory requirements imposed by regulations made under part 2A through a single point of contact.
Part 2A provides, among other things, that regulations can be made to prevent, protect against, control or respond to the spread of infection or contamination, including radiation, which presents or could present significant harm to human health, including by conferring functions on local authorities. It provides for a local authority to apply to a justice of the peace for the making of a time-limited order to reduce or remove the risk that a contaminated or infected person, thing or premises who or that poses, or could pose, significant harm to human health infects or contaminates others. It also provides for regulations to be introduced promptly under an emergency procedure.
To be within the scope of the primary authority scheme, legislation has to be in an enactment specified in schedule 3 or be made under an enactment specified in schedule 3, or be made under section 2(2) of the European Communities Act 1972 and related to a particular specified matter. Accordingly, to bring part 2A, and any enactments made under part 2A as they apply in England, within the scope of the scheme, it has to be added to the list of enactments in schedule 3. Under section 4(4) of RESA, that needs to be done by an order of the Secretary of State.
RESA establishes a statutory framework for a business to form a partnership with a local authority—I will call it a primary authority from now on—to receive support and tailored advice from that primary authority in respect of complying with legislation that comes within the scope of the scheme. A business is entitled to rely on primary authority advice received in its dealings with other local authorities, so the business avoids the cost and regulatory burdens associated with the inconsistent interpretation and application of the law by different local authorities. That gives businesses confidence in the regulations being applied consistently, allowing and encouraging them to invest resources in complying with them, such as through staff training and putting policies in place.
Consequently, the public are better protected, as businesses find it easier to comply with regulations. In addition, local authorities can access, through a central primary authority register, primary authority advice that is given to a business in respect of a regulation. That enables the local authorities to avoid duplication of enforcement and to target high-risk areas. Where a local authority proposes to take enforcement action against a business that participates in the scheme, the primary authority will review the proposed enforcement action and consider whether it is consistent with the primary authority advice that it has previously given to the business.
Adam Afriyie (Windsor) (Con)
I thank the Minister for giving way. I have been here a long time—16 years—and I do not think I have ever seen a regulation that is so impenetrable in its actual actions. I want to give the Minister a bit of time to inject some inspiration. I wonder if he can give an example of how the regulation might work for a real business in a real scenario so that we can get to grips with what is actually being laid out. It feels a bit like something from Sir Humphrey—it is utterly obscure and impenetrable at the moment.
Paul Scully
It is indeed a technical scheme. On primary authorities, instead of having businesses go to the local authority for any area it might operate in, the regulation allows businesses to go to one local authority that has been appointed to tackle such a scheme. It already happens in various areas, such as trading standards. The regulation brings the particular public health order within the scope of the overarching scheme of primary authority. One local authority can effectively take the lead in interpreting and setting out the enforcement approach for public health emergencies. Unfortunately, the complexities of the technicalities that underlie the scheme mean that it gets technical very quickly.
Paul Scully
That is a good question, and I will come back to it in a second. We have worked together to come to this point, and businesses support what we are doing here. The regulation has been a long time in the making. Local authorities face a lot of challenges in interpreting at pace the regulations made under part 2A to reduce the impact of the covid-19 pandemic, as well as the associated burdens experienced by businesses in trying to comply with all of that. Business stakeholders, local authorities and trade associations have offered strong support for bringing part 2A within the scope of the scheme. In November 2020, the British Retail Consortium, which represents more than 170 major retailers, wrote to the then Business Secretary—now the COP26 President —to request that part 2A be brought within scope. The context for that request was that, in 2020, around 46,000 businesses with an existing primary authority partnership received informal advice on coronavirus regulations made under part 2A.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I thank the Minister for giving way and for making excellent progress in explaining the legislation. First, can he clarify that the regulation is about businesses that have locations or sites in multiple primary authorities, and would therefore be subject to competing advice? Secondly, does the regulation allow the businesses to choose the primary authority they receive advice from, or is that designation—on the point made by my right hon. Friend the Member for Walsall South—made by somebody else?
Paul Scully
It is exactly as the hon. Lady describes: the regulation concerns businesses that operate in different areas. The Secretary of State will designate the primary authority.
I can give one example of where the provisions have previously helped simplify the enforcement and interpretation of regulations, which concerns the primary authority for supermarket health and safety—the covid expert panel—which is made up of several primary authority officers and their business partners. The panel promoted active engagement with local authority enforcement teams and external bodies under health and safety legislation, which is in scope of the primary authority scheme, and remained at the forefront of their commitment to compliance in order to ensure that consistency.
Yes, the Secretary of State will designate the primary authority, but it gives businesses that are operating in multiple areas the confidence to know they will have a single set of rules to follow that are consistent, and enforcement will be consistent as well. That is what I mean about the fact that 46,000 businesses with an existing primary authority partnership are getting informal advice—that is about as consistent as it gets. That is why the British Retail Consortium and other business stakeholders are keen to ensure in any future public health emergency that businesses can get that primary advice, rather than having to rely on different interpretations across the board. We know the current pandemic is unlikely to be the last public health emergency that the country will face. It is therefore important that the order ensures primary authority advice can be given in respect of legislation made under part 2A in the event of future public health emergencies.
In conclusion, as I have said, the order widens the scope of the existing scheme, enabling businesses to receive primary authority advice on meeting regulatory requirements introduced by regulations made under part 2A through a single local authority. It reduces the regulatory burden on businesses in England when complying with regulations brought in to control and contain a public health emergency, with the result that the public are better protected and local authorities can regulate more efficiently and effectively. I urge the Committee to approve the order.
Chi Onwurah
It is a great pleasure to serve under your chairship on this important piece of legislation, Dame Angela. As the Minister has set out, the legislation is being considered with a future pandemic in mind. It seeks to amend schedule 3 of the Regulatory Enforcement and Sanctions Act 2008, or RESA, to bring part 2A of Public Health (Control of Disease) Act 1984 within the scope of the primary authority scheme. As the Minister set out, the scheme is a framework for a business, particularly one with multiple locations, to form a partnership with a specific local authority, which is therefore the primary authority, to receive support on particular pieces of legislation.
A primary authority can support a business in many ways, such as by issuing primary authority advice that must be followed by other local authorities where the business operates, which are therefore deemed the enforcing authorities; by co-ordinating enforcement action proposed against the business and assessing whether it is consistent with a previous primary authority advice issue to the business; or by developing an inspection plan, which sets out national priorities for routine inspection of a business and provides information about compliance policies that are in place. In other words, it provides a formal way for a business to receive local advice on particular areas.
The legislation extends the advice that can be provided to include health protection regulations of the type brought in during the covid lockdown. In the event of a future pandemic, that would allow businesses to receive consistent and reliable advice on complying with the regulations from their local authorities. The Regulatory Enforcement and Sanctions Act was introduced in 2008 under Labour. It established the primary authority scheme, which allowed local authorities and fire and rescue authorities to become primary authorities.
Through the schemes, businesses could partner with primary authorities and receive advice on meeting environmental, health, trading standards or fire safety regulations through a single point of contact, rather than having to deal with different points of contact in different local authorities and each of the local authorities in which they might operate. The partnerships are available to any type of business, regardless of size or experience. Businesses can join the partnership directly, or they can belong to a trade association and benefit from a co-ordinated partnership. They are also able to engage in multiple partnerships, receiving advice on different regulatory areas.
The 2008 Act allows businesses access to authoritative advice on areas of regulation, while allowing regulators to support local economic growth through stronger business relationships and more effective regulatory compliance. Businesses are only asked to cover the recovery costs of any advice they receive from a primary authority, allowing the Act in normal times to provide a cost-effective way of encouraging regulatory compliance. The amendment to schedule 3 seeks to add part 2A of the Public Health (Control of Disease) Act 1984 to the Regulatory Enforcement and Sanctions Act 2008. Basically, by doing so, it would allow primary authorities to advise businesses on public health measures.
Any measures that we can take to support businesses to keep their employees and customers safe, and to recover and continue through the pandemic, are important measures to take. Labour recognises that we need to do all we can to make life easier, not harder, for businesses, and to make sure that advice can be clear and consistent. Providing clarity and consistency is the job of Government.
Unfortunately, throughout the pandemic we saw businesses struggling with covid measures, particularly given the often confusing and chaotic advice handed to them by the Government. In July, the Government washed their hands of responsibility and passed the responsibility regarding face covering and NHS covid passes to businesses, with no consultation with either businesses or unions.
As I am sure all Members of this House have done, I have met and spoken with businesses and representatives of businesses during the pandemic who felt incredibly let down, as the Government seemed to pass the buck when it came to the responsibility for taking action. Those businesses felt that they were not equipped to make public health decisions. They needed clarity and consistency in order to be able to plan ahead. There were also concerns about the lack of economic support for businesses and about the miscommunication in that regard. However, we cannot expect this piece of delegated legislation to do everything.
Our economic recovery has undoubtedly been weakened by the Government’s mishandling of public health and economic measures, a situation that is compounded now by the lack of any clear long-term growth plan. Such a plan is urgently needed.
We note that the explanatory notes state that
“business stakeholders, local authorities and trade associations in England have requested that this change be made”—
as the Minister has said—
“to enable a more uniform approach to the interpretation and application of regulations made under Part 2A of the Public Health (Control of Disease) Act 1984.”
Giving businesses the opportunity to receive consistent and straightforward advice on public health issues will not only help to protect the public but will aid businesses in coping with any health-related regulatory changes.
I have just a couple of questions for the Minister. First, in relation to public health advice, is there expected to be any cost recovery from businesses for the cost of any advice they receive from a primary authority, and what discussions has he had with business organisations about this matter? I ask this question because the impact assessment outlines a potential net benefit to businesses of approximately £20 million over the next decade.
Secondly, as we have discussed, the Minister said that the Business Secretary will designate a primary authority. Could he set out that process in a little more detail? Will the Business Secretary designate a primary authority for each business that might benefit from a primary authority? In the past, concerns have been raised that businesses could shop around between local authorities to choose a primary authority whose advice and interpretation they felt they would most benefit from. I assume that that will not be the case, because the primary authority will be designated by the Business Secretary, as the Minister set out.
Finally, we note that the Welsh Government have chosen not to pass consent on this amendment, following a move earlier this year by the Welsh Government whereby they wrote to all local authorities to achieve a similar outcome through voluntary recognition of the primary authority scheme in relation to covid regulations. I am sure that the Government will continue to work alongside the Welsh Government and share experience about what is working well and what should be shared as good practice across our nations, and for consistency in planning where businesses may work across our four nations. Labour recognises the importance of the amendment in the draft regulations, and its potential to offer effective advice to business in any future health crisis. We therefore support this amendment being made to the Regulatory Enforcement and Sanctions Act.
Paul Scully
Wales has public health delegated to it, and it has decided to go a different way. We will indeed work with the Welsh Senedd in ensuring that, even if we have a slightly different approach, we show a consistent face to business, because it is really important that businesses operating across Wales, Scotland, Northern Ireland and England have as much consistency as possible. As I said, the Secretary of State is indeed responsible for primary authorities, and provides the web-based primary authority register that supports the scheme. A business that receives advice from its primary authority, known as primary authority advice, is able to rely on that advice in its dealings with all local authorities by virtue of the fact that a local authority that proposes enforcement action against the business is required first to notify the primary authority.
That authority is then able to direct the local authority not to take a proposed action if the primary authority decides that it would be inconsistent with the original primary authority advice that it gave. That is what provides the certainty for businesses, but businesses can approach a local authority that has been working with the original primary authority that it may have sought enforcement action from or dealt with at an early stage. Ultimately, it will be the Secretary of State who is the arbiter to ensure that it is not just about shopping around for businesses, and that there is a level of control within this.
In terms of the business impact, over the period 2021-30 the expected one-off set-up costs for additional businesses to join primary authority schemes amounted to approximately £75,000 to £378,000. That is based on the likelihood of a public health emergency of 1% to 5% a year. That is 2,500-odd additional businesses a year that will be encouraged to form partnerships with a primary authority on account of being able to receive primary authority advice in the event of a public health emergency.
In a typical business year, the median annual cost to businesses of receiving primary authority advice is approximately £2,105. That is weighted by the estimated use of primary authority advice on part 2A regulations at 25%, reflecting the fact that 75% of primary authority advice would not involve advising on them. In terms of what the monetary or other benefits to businesses would be, businesses would wish to join the primary authority scheme only if they expected it to deliver a net benefit to them in the first place. No business will be compelled to join any primary authority scheme. That is why, as the hon. Member for Newcastle upon Tyne Central said, we expect including part 2A within the primary authority scheme to be a net benefit to business.
I have talked about the fact that the order brings within the scope of the primary authority scheme part 2A as it applies in England, as well as any enactment made under part 2A as it applies in England, which is really important for the reasons that I have outlined. I commend the order to the Committee.
Question put and agreed to.
Airport and Ground Operations Support Scheme
(2 years, 12 months ago)
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The Chair
Before we begin, I remind Members that they are expected to wear face coverings and to maintain social distancing as far as possible, in line with current Government guidance and that of the House of Commons Commission. Please also give each other and staff plenty of room when seated and when entering and leaving. Please can Members send their speaking notes to hansardnotes@parliament.uk.
The Parliamentary Under-Secretary of State for Transport (Robert Courts)
I beg to move,
That the Committee has considered the motion in the name of Grant Shapps relating to airport and ground operations support scheme winter 2021-22 renewal that this House authorises the Secretary of State to undertake to pay, and to pay by way of financial assistance under section 8 of the Industrial Development Act 1982, sums exceeding £30 million with an estimated total sum of £44 million, to be made available, through the extended airport and ground operations support scheme announced in the Budget, to eligible commercial airports and ground operators to compensate for the continuing damage caused by covid-19 to the aviation sector, on the basis of business rates liabilities or covid-19 losses, whichever is lower, from October 2 March 2022, subject to certain conditions and a cap of £4 million per eligible company.
It is a great pleasure to serve under your chairmanship this afternoon, Ms Nokes. I would like to update Members on the evolving situation regarding the omicron variant. As right hon. and hon. Members will have seen, the Government have taken steps to ensure the safety of the country. As of Sunday morning, 10 countries are on the red list. Scientists at the UK Health Security Agency are monitoring the development of this new variant closely, and laboratory testing is underway to assess its transmissibility, severity and vaccine susceptibility. The results of those investigations will determine any further public health actions, which may be necessary to limit the impact of the new strain.
Travel guidance has been updated, and the Foreign, Commonwealth and Development Office continues to offer tailored consular assistance to British nationals in-country in need of support overseas. The managed quarantine service is running for new arrivals from countries on the red list. We continue to work closely with the devolved Administrations in order to have a uniform approach, although they are, of course, responsible for administering and implementing their own regulations.
Notwithstanding the emergence of the omicron variant, it is important to note how far we have come since May, when the Committee was last together to consider the matter that concerns us today: seeking Parliament’s consent to use powers in section 8 of the Industrial Development Act 1982. I began my speech in May by remarking that the Committee was considering this matter at what is one of the most challenging—if not the most challenging—periods faced by this industry and our country. We still find ourselves in those difficult, strange and testing times, particularly in the context of the aviation sector, which I have the honour to serve as Minister.
We have seen enormously positive change since we met in May, with restrictions now significantly relaxed and the transatlantic corridor finally reopened after an unprecedented 18-month closure. The industry is emerging from a situation in which it has been heavily impacted. Despite these positive developments, the sector enters a winter season that even in pre-pandemic times would have come with challenges. With consistently lower passenger numbers year-on-year, the winter represents the most challenging period for what is a highly seasonal sector in any event. Airports and ground handlers have long relied on strong summers to offset weaker winters. Due to the pandemic, where airports and ground handlers have largely seen two consecutive loss-making summers, with demand at less than 50% of 2019 levels, there simply has not been that fruitful period to provide liquidity to tired airports and ground handlers through the testing winter months.
As I have mentioned, there is a continued watchful eye on the emergence of new variants and how they will impact the recovery we have seen thus far. In this challenging time, when the financial foundations that underpin the sector and its recovery continue to face challenges, the Government recognise the need for protection—both in the short term, to ensure the continuity of the operation for essential services, passengers and freight; and in the longer term, to ensure the endurance of the sector and the preservation of aviation capacity and connectivity, which is so important to the our shared objectives of building back better and levelling up the country. This is particularly important as we consider the impact of the Union connectivity review, which was recently published by Sir Peter Hendy.
As I have mentioned, it is right that we continue to support the aviation sector at this highly challenging time. It is one of the sectors that have been hardest hit by covid-19. We want to provide a funding and liquidity bridge to take the sector through the winter, and unlock the stability and prosperity that summer 2022 offers. That is the reasoning behind the Chancellor’s announcement of the renewal of the airport and ground operations support scheme in the autumn Budget. The renewed scheme will, subject to the House’s approval, be a continuation of crucial support to the sector. Eligible commercial airports and ground handlers will be able to access a grant up to the equivalent of their business rates liabilities or covid-19 losses—whichever is the lower—from October 2021 to March 2022, up to a per-claimant cap of £4 million, subject to certain conditions.
The extension of the six-month airport and ground handlers support scheme, or AGOSS, which I initially announced a year ago in November 2020, represents a vital tool to support the sector through the challenges of the winter before the summer peak of 2022, which offers the prospect of the sector finally regaining stability and pre-pandemic prosperity.
To continue to provide that fundamental financial relief, the Government intend to use the powers laid out in the motion, under section 8 of the Industrial Development Act 1982. That Act requires Parliament to provide its consent to use those powers where a project will exceed £30 million. We estimate that the total sum of relief provided under the scheme will be around £44 million.
As I have said in my brief remarks, it is clearly crucial that we continue to guarantee the future of our essential aviation infrastructure to support our sector’s recovery. I therefore ask that the Committee supports the motion.
Mike Kane (Wythenshawe and Sale East) (Lab)
It is a pleasure to serve under your chairmanship, Ms Nokes. On behalf of the Labour party, may I commend you on your extraordinary personal bravery recently? It will help women across the nation to come forward in future.
The Minister is right that it has been a bad weekend for the industry, through nobody’s fault. The omicron variant has led to new PCR tests and new uncertainty in the aviation sector, and it will be quite a blow for the industry during the winter, just as we thought we were beginning to make progress. As the hon. Member for Crawley knows, I visited his constituency on Thursday—I am very grateful to him for allowing me to do so—to visit Gatwick airport. Those at Gatwick were hopeful that things were beginning to come back to normal, despite the slots issue that the airport faces. Passenger numbers and the capacity of flights were increasing. The one thing the airport wanted was for there to be no further uncertainty, but unfortunately we now have uncertainty again.
The Secretary of State for Health and Social Care is still in the main Chamber announcing measures on wearing face masks in shops and on public transport. We really should not have taken those measures away. I am sure that we would all agree that the health of the British people should not be a culture war, and that keeping people safe is the first priority of the Government and of Her Majesty’s official Opposition. I say to the Minister that we have not had a credit card’s thickness of difference between us in our public health messages over the last year or so. I hope that we can continue that co-operation.
We all know that the covid-19 crisis has already had a devastating impact on the whole aviation industry, which contributes £22 billion and 267,000 direct jobs, with a further 1.5 million people employed in the supply chain. The UK is home to the largest aviation sector in Europe and the third largest on the planet. My own constituency is home to Manchester airport, a key gateway to the north. The economic benefits and jobs it brings to the north-west of England are vital to the region and to my constituents, and that will be mirrored by every airport across this great nation.
A number of airlines and airport operators announced further plans to make a significant percentage of their workforce redundant, and that situation will not be helped by the sad news this week. The expectation is that, with a second missed summer season and without further Government support, there is potential for a number of major companies in the industry to cease operating.
With the fast-evolving changes in the nature of the coronavirus pandemic, we cannot predict a return to business as usual for the sector. For that reason, I and my colleagues in the Opposition have continually called for a sectoral deal, only for those calls to fall on deaf ears. I know the Minister agrees that aviation must remain a critical part of the UK economy. More than a year ago, the Chancellor promised an aviation sectoral deal. That has still not materialised, and what is laid down in this SI is not it—£4 million will not touch the sides of the help needed for some of our airports and ground handlers in this country.
I have previously stated on the record my belief, akin to a latter-day Richard Cobden MP, that if we restrict somebody’s trade and their way to make a living, we must compensate them meaningfully. I do not want to give a lecture on the corn laws, but that truth is as relevant today as it was 200 years ago. We should not forget that the Government’s stated ambition to level up our regions will be dealt a significant blow if such an important sector is allowed to go without any meaningful support. We can see the problems currently occurring at Cardiff airport for that reason.
When we consistently called for a sectoral deal, it was to support the whole aviation industry. A deal would have secured jobs and protected the supply chain while the industry learned to stand again on its own two feet. We would also have continued to press for higher environmental standards; it is vital that the aviation sector becomes more environmentally sustainable. But to protect against short-term unemployment and stimulate that change, the Government must take action now to ensure that long-term needs are met.
I cannot see how increasing air passenger duty for some passengers and removing it for others will help the charge to decarbonise aviation, but that is one of the crumbs that the industry is supposed to be grateful for. Even as we transition to a green economy, protecting jobs now so that they can be reskilled for the future economy is critical. It is far easier to transition our aviation sector to greener aviation from a position of strength than a position of weakness. Yet again, this—
The Chair
Order. I remind the shadow Minister to stick to the airport and ground operations support scheme, please.
Henry Smith (Crawley) (Con)
It is a pleasure to serve under your chairmanship again, Ms Nokes, and always a pleasure to follow the hon. Member for Wythenshawe and Sale East. He is always welcome at Gatwick, as long as he does not travel a little further south and knock on doors in Crawley to try to win voters down there.
I rise briefly to warmly welcome this extended support for airports and ground operators. It will be a significant help for airports such as the one I represent, Gatwick, and across the country. At that point, normally, I would have sat down, but my hon. Friend the Minister mentioned the omicron variant of covid-19 and its effect on international travel, and I cannot let that pass. I think the Government have reacted swiftly and proportionately to that threat, until we know the full extent of it, but the imposition of PCR tests for those returning to the UK from international destinations, at least for the next three weeks, will be a huge disincentive to travel, with people perhaps reassessing plans for the Christmas holiday period.
I know the Department for Transport and the aviation Minister get that point, and that it is a broader Government issue, but I put in a plea for a cap on the cost of those tests, and hopefully an ability to review in three weeks’ time—
Robert Courts
I very much appreciate the points that the Committee has made today, and I will answer them briefly, if I may. The hon. Member for Wythenshawe and Sale East and I have sparred across the Chamber on many matters over the course of the past year or so. Although we do not always agree on everything, there are some things we really do agree on, and the real importance of the aviation sector to this country is certainly one of them. We also agree, of course, about it becoming a more sustainable industry, and he knows I will point to the Jet Zero Council and the other work we are doing as proof positive that that is taken seriously by the Government as well.
We will continue to consider how the industry may best be supported at what we all accept is a very challenging time. The hon. Gentleman will know that I will refer to the approximately £8 billion of support that the sector has received from the Government and, as my hon. Friend the Member for Crawley says, this is the latest instalment of that—I am grateful to my hon. Friend for saying that this support is significant.
Turning to my hon. Friend’s points, he raised the question of PCR tests. I understand that that is an extra challenge for the sector, but it is simply so that we can have the genomic sequencing we need so that we have the data. In three weeks’ time, that will be reviewed—but, as a responsible Government, we keep all our policy under review at all times.
More broadly, regarding the motion itself, we have a recovery and we have made great steps, as I said at the outset, but we still need to be cautious. That is the reason the Government have taken these steps, but the sector’s recovery remains fragile because of previous restrictions we have had to impose, and there is a challenging winter period coming up. While demand is recovering, it is still suppressed, and that is why we offer this support to secure jobs, maintain cash flow and safeguard vital infrastructure, in order to provide the conditions for the sector to bounce back into the future. I commend the motion to the Committee.
Question put and agreed to.
Draft Renewable Transport Fuel Obligations (Amendment) Order 2021
(2 years, 12 months ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
Before we begin, I remind Members that they should wear face coverings except when speaking and unless exempt, and maintain social distancing as far as possible. This is in line with current Government guidance and that of the House of Commons Commission. Please give one another and staff space when seated and when leaving the room. Members should have a covid lateral flow test twice a week, either at the testing centre in Portcullis House or at home. If Ministers and Members have speaking notes, it would be greatly appreciated by officials if they could send those notes electronically to hansardnotes@parliament.uk.
The Parliamentary Under-Secretary of State for Transport (Trudy Harrison)
I beg to move,
That the Committee has considered the draft Renewable Transport Fuel Obligations (Amendment) Order 2021.
It is a pleasure to serve under your chairmanship for the first time, Mr Stringer. The instrument amends the Renewable Transport Fuel Obligations Order 2007, which established a certificate trading scheme known as the renewable transport fuel obligation. The RTFO promotes a market for renewable fuels and places obligations on larger suppliers of fossil fuels to ensure the supply of renewable fuels. Since 2018, that main obligation has included a sub-target supporting the uptake of development fuels. Development fuels are made from sustainable wastes or renewable energy. They deliver higher carbon reductions than traditional biofuels, and include fuels of strategic importance such as aviation fuels, drop-in fuels and renewable hydrogen. The amount of renewable fuel, including development fuel, to be supplied under the obligation is calculated as a percentage of the volume of fossil fuels supplied in a calendar year. Those obligations are met by acquiring certificates that are awarded for the supply of sustainable renewable fuels. The trade of those certificates provides a revenue stream for suppliers of renewable fuels.
The draft instrument delivers several commitments made in our transport decarbonisation plan, which was published in July. It increases the main RTFO obligation level from 9.6% to 14.6% by 2032, continuing at that level in subsequent years, and makes a corresponding change to the development fuel sub-target, ensuring that it is not reduced in absolute terms. The instrument further expands RTFO support for suppliers of renewable hydrogen. It does so by extending certificate eligibility to renewable hydrogen used in maritime vessels and in fuel cell-powered rail and non-road vehicles. Importantly, as targets for the supply of renewable fuels increase, this instrument further strengthens the sustainability and greenhouse gas emissions savings criteria that renewable fuels must meet.
The changes made by this instrument will make an important contribution to achieving UK carbon budgets. As we transition to zero-emission vehicles, we cannot ignore carbon emissions from conventional road vehicles, and increasing the supply of renewable fuels is the best abatement option for many such vehicles. Those low-carbon fuels will increasingly be required in the aviation and maritime sectors. The increase in targets for the supply of renewable fuels in this instrument can deliver carbon reductions quickly, and will provide investor certainty. Expanding eligibility for renewable hydrogen used in maritime and fuel-cell vehicles is an important transitional step, which will encourage the innovation needed to increase deployment of low-carbon fuels in transport sectors that are more challenging to decarbonise.
This instrument is a small part of the wider work that we are undertaking to drive down carbon emissions from liquid and gaseous fuels. Work is progressing at pace to consider further RTFO support for hydrogen, building on the summer consultation. That work includes better supporting hydrogen production plants located away from sources of renewable energy. We will respond with further proposals on the treatment of hydrogen under the RTFO early next year. Similarly, it is our intention to make recycled carbon fuels eligible for support under the RTFO scheme, once primary legislation is secured.
Recycled carbon fuels could play an important role in decarbonising aviation, supporting the aim set out in our net zero strategy to become a leader in sustainable aviation fuel. The net zero strategy contained £180 million of new funding to accelerate the commercialisation of UK SAF production and our ambition for 10% SAF to be blended into UK aviation fuel by 2030.
Beyond 2030, we are developing a long-term strategy for low-carbon fuels to meet decarbonisation challenges across transport sectors. The strategy, to be published next year, will set out the likely transition from road to other transport sectors, and examine the size of the opportunity for UK industry and the ways in which Government policies could support these changes.
In the here and now, it is worth noting that the RTFO delivers around a third of the savings required for the UK’s current transport budget. In 2020, the RTFO scheme saved carbon emissions equivalent to taking 2.5 million combustion-engine-powered cars off the road. The changes in this instrument are estimated to deliver carbon reductions equivalent to the removal of an additional 1.5 million cars from the road by 2032.
This instrument builds on the success of the RTFO scheme and is an important part of our future work to decarbonise transport. I commend this statutory instrument to the Committee.
Mike Kane (Wythenshawe and Sale East) (Lab)
It is a pleasure to serve under your chairmanship, Mr Stringer. In 35 years of knowing you, that is the first time I have referred to you as Mr Stringer. I have referred to you as many other things during that 35 years, but they may not be for the public record.
I put on record that the Chairman and I were together on Thursday night to mark the retirement after 25 years of Councillor Sir Richard Leese, the leader of Manchester City Council, but it must be remembered that Manchester’s renaissance, which gained pace under Sir Richard, was started by the Chairman when he was leader of Manchester City Council for 12 years.
Mike Kane
That marks nearly 40 years of continuous leadership by two politicians. I am eternally grateful to the Chairman for taking me under his wing as a very young councillor in the great city of Manchester. Okay, I have embarrassed you enough, Mr Stringer.
The statutory instrument amends the renewable transport fuel obligations order 2007, as the Minister rightly said, and will help further to increase carbon savings by increasing renewable fuel targets and expanding the renewable transport fuel obligations to sectors with limited alternatives to decarbonise, such as maritime.
While we welcome the SI, it does not go far enough. We need to be doing much more radical things if we are to decarbonise the transport sector. The covid-19 pandemic has dominated headlines, but we cannot forget that we are still in a climate emergency and that green, efficient transport is the future. As transport is now the largest contributing sector to UK emissions, it is worth reinforcing the need to reinvest in our communities and offer true levelling up across the regions. We needed a radical plan to decarbonise and get polluting vehicles off our streets, but what did we get in the autumn spending review? A cut to air passenger duty for domestic flights, a devasting announcement on HS2 and the abandonment of most of Northern Powerhouse Rail. That will not take 1.5 million cars off our northern roads any time soon.
The UK hydrogen strategy, which the Minister mentioned, identifies transport as the key early market for hydrogen in the 2020s. While the new policy plans outline long-term frameworks for business models, these will not come into effect until 2024-25. The Government’s offering ranges from absolutely zero to nowhere near enough, and every shade of not much in between. The Government’s unambitious approach to something that we all know and agree is vital to our future should be a major concern for us all.
Internationally, Governments are investing billions in alternative fuel markets. For example, Germany has invested €9 billion in its hydrogen markets and France has invested €7 billion, whereas our Government are under-investing and hoping to stimulate private investment through smaller targeted funds. If the UK were to invest properly in research, technology and infrastructure, we could truly become world-leading in this technology. For instance, Hamburg port alone is investing £100 million in decarbonising itself. The Government here have announced a fund for £20 million for the whole country for a competition. It really is not good enough.
There are a couple of areas where the Government have not gone far enough and are examples of why we are struggling to offer support. The Government have announced that they will ban the sale of new petrol and diesel vehicles in 2030—a policy with which we agree, as it was our policy too. However, there is no commitment to phase out the sale of second-hand vehicles. Another example of something for which the Opposition have been calling for some time is the formal inclusion of international aviation and shipping emissions in future carbon budgets; however, we still need to see detailed, specific plans on how those sectors will be decarbonised. As I said, all the efforts are being undermined by plans to cut air passenger duty on domestic flights.
You and I, Mr Stringer, represent a city that started the industrial revolution and saw the beginning of the mass extraction of fossil fuels to fund a new world order. It would be great if we could have a commitment from Government that our regions and great cities in the north will not only decarbonise but grow wealth and jobs in those regions, and lead the world in reversing what we started.
Trudy Harrison
I thank the hon. Member for his interesting comments. The UK’s sixth carbon budget requires a reduction in emissions of 78% by 2035 compared with 1990 levels. That will require rapid action across the economy, supported by technological innovation. The changes in the instrument to expand the support currently provided by the RTFO for renewable hydrogen and to foster that innovation send a clear message for future low-carbon fuel investments. The increase in the RTFO obligation by 5% to 2032 is beyond ambitious. It is also necessary to reduce the environmental impact of conventional vehicles that use petrol and diesel. It is achievable, based on the availability of sustainable feedstocks, and it is widely supported by fuel suppliers, including suppliers of fossil fuels that would be obligated.
With the ongoing support of the RTFO, the UK fuel sector can play its part in helping to drive the UK’s transition to net zero and the green jobs that it will bring. The hon. Member referred to a number of measures that he would like to see. I remind him that, as we set out in our transport decarbonisation plan this July, we have made a commitment to phase out the sale of petrol and diesel cars from 2030, and that all cars and vans will be zero emission at the tailpipe from 2035. We have made a commitment on heavy goods vehicles: 26 tonnes from 2035, and then larger vehicles from 2040. We have set out our commitment for sustainable aviation fuel: 10% by 2030. I think that he, and Members across the Committee, would agree that we are making huge progress in the decarbonisation of transport. I hope that the Committee will join me in supporting the statutory instrument.
Question put and agreed to.