Mr Virendra Sharma (Ealing, Southall) (Lab)
The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)
As the hon. Gentleman knows, the energy price cap continues to protect consumers in a world where gas prices have more than quintupled in a year, and I strongly expect that it will continue to do so.
Mr Sharma
I thank the Secretary of State for that answer. Given the pressure that families are facing in this cost of living crisis, does he agree that the best way to help families to pay their bills is through a windfall tax on oil and gas producers in the North sea to give the poorest up to £600 off their bills?
Kwasi Kwarteng
As the hon. Gentleman will know, we believe that a windfall tax in this situation would be a tax on jobs, destroy investment and add to the uncertainty in oil markets. It would send completely the wrong message to investors, as well as to people who are invested in markets. Every one of us, anyone with a pension, would be adversely affected by such a tax.
Alun Cairns (Vale of Glamorgan) (Con)
My right hon. Friend is keen to ensure that householders and landlords improve the energy performance of properties. Will he consider the effectiveness of the current energy performance certificate system and whether that genuinely reflects the energy performance of a property? In addition, will he recognise the additional costs incurred in calling for improvements in off-grid properties, where people do not have the opportunity to invest in the same technologies as those in on-grid properties?
Kwasi Kwarteng
I am grateful to my right hon. Friend for that question. As he knows, the current EPC system is not perfect, but it does capture the significant improvement that has happened over the past few years. I am happy to consider people off grid and the challenges that they face from oil prices, and I would be happy to speak to him about that.
Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
In recent years, the UK Government have printed and borrowed hundreds of billions of pounds, which have been gathered—I emphasise the word “gathered”—not earned by billionaires and the already wealthy. As a result, we have a cost of living crisis that makes energy price rises an acute crisis. Kerosene central heating oil has seen some of the biggest price differences, which especially hits rural and island areas where there is no mains gas. Do the Government have any plan to give people in such places a hand, which would cost a damn sight less than the bailout money that the billionaires have raked in from the Treasury?
Kwasi Kwarteng
As the hon. Gentleman knows, my right hon. Friend the Chancellor of the Exchequer announced an extensive package of support only a few weeks ago worth £9.1 billion—that included a £150 council tax rebate for bands A to D and £144 million in discretionary funding for local authorities—which affects everybody in this country. I am also very happy to engage with him on the specific issue of oil prices.
Sara Britcliffe (Hyndburn) (Con)
I have been contacted by many pensioners across Hyndburn and Haslingden who are concerned about the cost of their energy bills. Will the Secretary of State set out what measures are in place to support my residents, and will he continue to work with other Departments to keep those measures under review?
Kwasi Kwarteng
As I said, the Chancellor announced a £9.1 billion package of support only a few weeks ago. That included the £150 council tax rebate for bands A to D and £144 million in discretionary funding added for local authorities—spending to help the most vulnerable. We announced a £500 million extension of the household support fund last week, but I would be happy to engage with my hon. Friend on what more we can do in the next few months to assuage the burden.
Kwasi Kwarteng
I am very happy to answer the hon. Gentleman’s questions. He will know that the next price cap period will be set in August. Even he, with his gifts of prophecy, does not know what the price cap level will be in August. As the Chancellor of the Exchequer has said, we are continually reviewing actual spot markets and what is happening in the market.
The hon. Gentleman will know that nothing could be more damaging to the sector, to people employed in the sector and to the hundreds of thousands of jobs and families dependent on the sector than an arbitrary windfall tax, which would also impoverish many of the people exposed to those companies through their pensions. It is a regressive, retro measure that completely does not understand what business is all about.
Stephen Flynn (Aberdeen South) (SNP)
Aside from saying that he drives an ageing VW Golf, the Secretary of State is using every excuse possible to try to defend the indefensible. In just a matter of days, the energy price cap will increase by some 700 quid; in just a matter of months, it is anticipated that it will increase by a further £1,000. The Government’s response is 150 quid off council tax and £200 that they say is not a loan, but that is indeed a loan. Energy bills are anticipated to increase 14 times faster than wage increases. How on earth are people supposed to get by?
Kwasi Kwarteng
As I have said, we have a £9.1 billion support package, which was announced only four weeks ago. On top of that, we allocated £500 million of additional relief only last week to help people through this difficult time. One way in which I am afraid bills would go up is if we adopted the insane SNP policy of essentially shutting down North sea oil and having no intention at all to develop nuclear. That would be an utterly irresponsible and highly expensive way of dealing with the current problem.
Stephen Flynn
The Secretary of State does himself no favours by attempting to invent policies that are simply not reflective of the SNP’s position at this moment in time—but this discussion is about energy bills. If someone lives in the north of Scotland, their energy bill standing charge will increase by some 83%; if they live in the south of Scotland, it will increase by 100%; but if they live here in Westminster, in London, it will increase by just 38%. Scotland is energy-rich—oil and gas, wave, wind, tidal, hydro pumped storage. How on earth can the Secretary of State justify the inequity in such pricing?
Kwasi Kwarteng
The hon. Gentleman is indeed correct: Scotland is extremely wealthy in its range of energy sources. That is why we have sought to encourage it through things like the £27 million Aberdeen energy transition zone and the North sea transition deal. We have constantly supported the Scottish energy industry. The hon. Gentleman refers to a report by Ofgem. I speak to it regularly, and we always try to see what we can do to justify and to equalise bills across the UK.
Andrew Bridgen (North West Leicestershire) (Con)
I welcome the fact that the Prime Minister has announced that he will publish an energy supply strategy to deal with the UK’s energy requirements for the short, medium and long term. Can the Secretary of the State update the House on when we can expect the strategy to be published?
Munira Wilson (Twickenham) (LD)
The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)
As the hon. Lady will know, few countries have done as well as we have in respect of offshore wind. We are backing a range of other technologies through our strategy, and also through the 10-point plan.
Munira Wilson
Russia’s invasion of Ukraine has made clear how crucial it is for the UK to press on with the push to roll out renewables and strengthen its energy security. Almost three weeks ago, the Prime Minister said that an energy independence plan would be unveiled in the next few days and there was speculation about a renewed push for onshore wind, but that plan has been delayed again, apparently because the Chancellor is blocking it. Will the Secretary of State explain why the Chancellor is now deciding energy policy?
Kwasi Kwarteng
The hon. Lady will understand that, when such publications are issued, a range of cross-Government “write-rounds” is required. We are constantly talking to colleagues across Government, not just in the Treasury, so that we can land the energy strategy as quickly as possible.
Derek Thomas (St Ives) (Con)
Getting on top of energy issues, particularly those relating to renewable energy, is the most difficult challenge in rural areas such as mine. How will the Secretary of State’s strategy—to be launched soon—enable the renewable energy sector to grow from the grassroots up, so that people in fuel-poor homes, who may not have the money to buy the necessary equipment at the outset, have an opportunity to install solar panels and battery storage which will help them to deal with the rising cost of energy?
Kwasi Kwarteng
We have just cut VAT on many of those products. I have already visited my hon. Friend in his constituency, and I am happy to have further discussions about what more we can do to drive the take-up of these important technologies.
Afzal Khan (Manchester, Gorton) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
In January 2021, we announced a robust package of measures to help to ensure that no UK organisations are complicit in the human rights violations being perpetrated in Xinjiang. We have also supplied detailed guidance to UK businesses, and will continue to engage with them.
Afzal Khan
I have lost count of the number of times I have urged the Government to take stronger, more robust action against China’s ongoing genocide of Uyghur Muslims. The Chancellor of the Duchy of Lancaster was spot on when he said that UK organisations must immediately sever their commercial ties with Russia to ensure that public money is not funding Putin’s war machine. In the light of a genocide that is happening on our watch, is it not high time that the Government applied the same rules and ensured that public organisations sever their contracts with Xinjiang? Will they also support amendments to the Health and Care Bill to prevent the NHS from being complicit in forced Uyghur labour?
Paul Scully
Evidence of the scale and severity of the human rights situation in Xinjiang paints a harrowing picture. The British Government will not stand for forced labour, wherever it takes place. We require businesses to report on how they are tackling modern slavery and forced labour in their operations and supply chains, and we plan to extend that to certain public bodies and to introduce financial penalties for organisations which do not comply. That will require legislative change, and legislation will be introduced when parliamentary time allows.
Justin Madders (Ellesmere Port and Neston) (Lab)
That was a pretty strong-sounding answer from the Minister, but let us see whether those fine words are put into practice. An audit undertaken two years ago found that 17% of organisations—more than 2,500—that should have published a modern slavery statement had failed to do so. Can the Minister tell us what action has been taken since then to ensure that they do?
Paul Scully
On 11 March 2021, the Government launched an online modern slavery statement registry, and we are now encouraging all organisations within the scope of the legislation to submit their statements to it. More than 7,000 statements have been submitted, covering more than 23,350 organisations on that voluntary basis.
Alicia Kearns (Rutland and Melton) (Con)
Canadian Solar wants to build a solar plant in my constituency the size of 1,400 football pitches. In 2021, four of its shipments were seized owing to its links with Uyghur blood labour, and its subsidiary GCL-Poly has been sanctioned by the United States Government because of its complicity in genocide. Will my hon. Friend assure me that we will blacklist from nationally significant infrastructure projects all those companies that are complicit in genocide, and confirm that we will not allow blood labour to stain our green and pleasant lands?
Paul Scully
As I have said, we have strong procedures to vet suppliers, and we have been given repeated written assurances from people who supply that they proactively monitor supply chains to ensure that forced labour is not used. We will of course ensure that the company to which my hon. Friend has referred comes within that robust supervision.
Patricia Gibson (North Ayrshire and Arran) (SNP)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)
As the hon. Lady knows, the standing charge is designed to reflect the costs of connectivity and usually covers the fixed costs that the suppliers incur. If it was removed, that cost would simply be passed on to consumers. Standing charges are a matter for Ofgem, which has launched a call for evidence. The Government are focused on helping consumers through the £9 billion package of relief announced by the Chancellor a few weeks ago and the £5 billion announced last week to help families and households with the cost of fuel.
Patricia Gibson
From this Friday, households will face an average 80% increase in standing charges for electricity. Negligent policy making and bad practice in the industry will be paid for by the poorest and most vulnerable consumers, who will pay the highest standing charges, with those in Scotland amongst the hardest hit. Will the Minister consider capping or even scrapping these standing charges on the basis that they are discriminatory to the poorest and most vulnerable consumers?
George Freeman
If it was as straightforward as that, the answer might be simple, but it is not—[Hon. Members: “Yes it is!”] No, it is not. The energy market is extremely complex, and there is a whole raft of charges. It is not true to say that Scottish consumers are hit particularly hard, as Scotland is also a net exporter and English and Welsh consumers are paying for it. The Government are absolutely focused on helping consumers with the cost of energy through the £9 billion relief announced in February, the £5 billion announced last week, the extra money for the warm home bonus and all the support mechanisms for the vulnerable. It is not simply a case of constantly tinkering with market price.
Suzanne Webb (Stourbridge) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Lee Rowley)
Nuclear energy is crucial in providing low-carbon baseload power, which, over the long term, assists in reducing our reliance on fossil fuels and our exposure to volatile global prices. We will continue to emphasise the vital role of the nuclear sector, including in the forthcoming energy supply strategy.
Suzanne Webb
Our very own atomic kitten, my hon. Friend the Member for Ynys Môn (Virginia Crosbie), and I are going on a road trip to Hinkley Point C. When I did my research for the visit, I noticed that £5 million-worth of business opportunities had been realised by 36 companies in the west midlands, including three in my constituency, on the back of Hinkley Point C. Does the Minister agree that our investment in nuclear energy is not just about clean energy but about the supply chain opportunities that it will bring to small and medium-sized enterprises and manufacturing in my constituency?
Lee Rowley
My hon. Friend is right to emphasise not only the importance of nuclear in concept but the huge significance of the supply chain, which is estimated to support more than 60,000 jobs across the whole of the United Kingdom, including in SMEs in Stourbridge and Ynys Môn. And if I may shove in my knowledge of early 2000s pop music, we are working hard to make the nuclear industry whole again. [Laughter.]
Tim Farron (Westmorland and Lonsdale) (LD)
That was written by a member of Orchestral Manoeuvres in the Dark, so we will give the Minister that.
Energy security is of vital significance, particularly at the moment, and nuclear is part of the clean energy mix. Does the Minister understand that the United Kingdom, which has the second highest tidal range on planet Earth after Canada, is not making anything like sufficient use of that permanent tidal energy? Will he look again at his Government’s policies on tidal, marine and hydro energy and give a boost not only to Cumbria and its energy coast but to the whole country?
Lee Rowley
The hon. Gentleman raises an important point about the importance of a diversified and secure energy supply. This is one of the reasons that the Government are looking at all forms, including tidal, and it is why we would encourage people from across the House to agree not just with tidal but with nuclear as well.
Virginia Crosbie (Ynys Môn) (Con)
In the 2018 nuclear sector deal, £20 million was pledged towards Britain’s first thermal hydraulic testing facility, in north Wales. Does my hon. Friend agree that it is vital that the UK establish world-leading capabilities in thermal hydraulics, and can he provide an update on the next steps for this vital investment?
Lee Rowley
My hon. Friend is an absolute champion of the nuclear industry. I believe that this proposal would make the UK third in the world. We are working hard to see what can be done and I will certainly pass on her keenness for progress to be made.
Tommy Sheppard (Edinburgh East) (SNP)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
The contracts for difference scheme is a flagship scheme that has contributed to our fivefold increase in renewables since 2010. High environmental performance is a prerequisite for contracts for difference applications, and the next CFD round will require even more ambition from applicants.
Tommy Sheppard
I, like many people, have difficulty understanding how burning trees on an industrial scale and pumping carbon dioxide into the atmosphere can be any part of a low-carbon solution, or indeed why the British taxpayer subsidises private companies to do this. Given the Glasgow declaration and the new COP26 standards, is it not time to review whether the British taxpayer should remain the world’s largest subsidiser of tree burning and, in particular, whether contracts for difference on biomass awarded before 2015 would now be awarded were they to meet the new standards and targets?
Paul Scully
As a condition of receiving payment under the contracts for difference scheme, generators must demonstrate that they meet our biomass sustainability criteria, irrespective of where that biomass is sourced. There is no evidence that deforestation has occurred in the areas from where UK electricity generators source their biomass, but we must make sure biomass is sourced from areas that are managed consistently with sustainable forest management practices.
Jack Brereton (Stoke-on-Trent South) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Lee Rowley)
The UK remains one of the world’s largest manufacturing nations, and the Government agree that manufacturing plays a vital role in the health of the UK economy. It is ultimately for British manufacturers to make decisions on their own strategies, but the Government continue to support them through a range of initiatives on productivity, costs, innovation and investment, ranging from Made Smarter to the catapults and the global Britain investment fund.
Jack Brereton
I very much welcome the Prime Minister’s response last week to my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft) that energy-intensive manufacturers such as ceramics will be covered by the upcoming British energy security strategy. These sectors are more important than ever, particularly for future technology, and they need support to address high energy costs now. Will my hon. Friend the Minister do more to support ceramic manufacturers to invest in new technologies and increased energy efficiency?
Lee Rowley
There is no bigger champion of the ceramics industry than my hon. Friend and his colleagues from Stoke, who work as an excellent team in supporting the industry as a whole. The Government have worked with industry for many years to mitigate the costs of energy, including an aggregate of £2 billion-worth of subsidy since 2013. From our multitude of conversations on the ceramics industry with him and his colleagues, I know he will encourage manufacturers in his constituency to consider other opportunities such as the industrial energy transformation fund.
Zarah Sultana (Coventry South) (Lab)
Earlier this month, bosses triggered a consultation on redundancies at Liberty Pressing Solutions, a business in my constituency that produces high-quality products for the automotive industry. Financial difficulties at its parent company, the Gupta Family Group Alliance, have put its future in doubt, and with it the jobs of more than 200 people. I visited the factory and met the company’s skilled, dedicated workers, who risk being plunged into unemployment just as the cost of living crisis intensifies. What is the Minister doing to protect skilled jobs such as these, which are vital in transitioning to a green and sustainable economy? Will he meet me to discuss how we can save these jobs?
Lee Rowley
The hon. Lady is right to highlight the importance of a strong manufacturing base, which is one reason why we have spent so much time supporting and having active discussions with manufacturing. The challenges around Liberty are well known, and I have also visited Liberty sites in recent weeks and months. I am happy to meet her to talk further.
Mark Pawsey (Rugby) (Con)
Manufacturers will open their factory doors on 7 July in a UK-wide open house, which is an opportunity to showcase the diversity of the sector, the range of highly skilled jobs on offer and the amazing opportunities for reskilling and career development within UK manufacturing. Will the Minister join me in supporting National Manufacturing Day 2022?
Lee Rowley
I could hardly say no. I look forward to doing that and visiting many great manufacturers across the country. We are highlighting the brilliant work of the sector, and we continue to champion it as a vital part of the UK economy.
Alex Cunningham (Stockton North) (Lab)
The Government are well aware of the crisis they have created for energy-intensive industries such as those on Teesside. Now that the EU has set aside €50 million to help its firms with energy costs, British firms such as CF Fertilisers, which have no such support, face even tougher competition. I know the Minister is visiting the company tomorrow, but what will the Government do to address the impact of this EU funding on UK fertiliser production? Can he advise on when a decision will be taken about renewing the electricity compensation scheme for energy-intensive industries, which runs out on Thursday?
Lee Rowley
I thank the hon. Gentleman for his contribution. He will be aware of the substantial support we have given manufacturers over many years, including more than £2 billion to mitigate energy prices. I note that in Teesside there have been recent announcements that demonstrate the confidence people have within manufacturing as a whole.
Shaun Bailey (West Bromwich West) (Con)
My hon. Friend will know that small and medium-sized manufacturers make up the core of the manufacturing base in the Black Country, but many of mine in Wednesbury, Oldbury and Tipton will be slightly concerned that they have missed out on investment because of their size. Will he meet me and manufacturers from the Black Country to discuss how we can ensure that they make the most of the packages on offer for them to succeed?
Lee Rowley
My hon. Friend is a great champion for his constituency. I have been to the west midlands regularly to talk about the importance of the manufacturing base, and I would be happy to meet him to talk about West Bromwich.
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
In the past, the Nigg oil fabrication facility in Easter Ross built some of the mightiest production platforms for the UK—I worked in that yard. Today, wind turbines for both onshore and offshore power seem to be built anywhere but in Scotland. The firm that owns the Nigg yard announced plans almost four months to get into fabrication, but since then we have not heard a lot. I do not expect the Minister to have the answer at his fingertips, but will he ask his Department to see how progress is- coming along on that front, because it is crucial for the local workforce?
Lee Rowley
I would be very happy to speak to the Department and come back to the hon. Gentleman on that.
Richard Fuller (North East Bedfordshire) (Con)
Investment is attracted to areas that have agile, pro-growth regulatory environments. In this country, we delegate a lot of the implementation of regulation to agencies, but the oversight and assessment of regulatory agency performance is weak. Will the Minister look at ways in which we can improve how we regulate the regulators?
Lee Rowley
My hon. Friend highlights an important point about getting the balance right between regulation, and ensuring that the output and productivity of these industries works. I would be happy to talk to him more if that is helpful.
Bill Esterson (Sefton Central) (Lab)
The spring statement did not
“address the complex challenges facing the manufacturing sector”.
It just is not
“tenable for thousands of businesses”
and it is
“kicking the can down the road”.
Those are the words of three businesses that are asking for help. So how about this: first, cancel the 10% increase in national insurance payroll tax; secondly, cut energy bills by up to £600 per household; and, thirdly, set up a £600 million energy-intensive industries contingency fund? Our plan is following the evidence from the business community of what is needed. Why will this Government not help businesses that are crying out for support?
Lee Rowley
The hon. Gentleman highlights the importance of manufacturing, which we have already talked about in these questions. This Government are a champion of manufacturing—[Interruption.] I am so glad that all Opposition Members agree with me. If they really do, they would recognise that ensuring a strong manufacturing base is incredibly important. The Labour party can provide no lessons, on the basis that it decimated manufacturing before 2010.
Jonathan Gullis (Stoke-on-Trent North) (Con)
I am glad now to know who the Minister’s favourite in Stoke-on-Trent is. Steelite, based in Stoke-on-Trent North, Kidsgrove and Talke, received funding from the regional growth fund, but it is being asked to pay back £685,000 plus interest due to capital underspend. The reason for that is simple: a global pandemic came across in March 2020, so it was not viable for Steelite to invest in capital when it did not even know whether it was going to continue to exist or how long the pandemic was going to last. Will my hon. Friend meet me and representatives of Steelite to discuss how that funding can continue to stay, so that Steelite can add to its factory and therefore employ more people locally?
Lee Rowley
I am happy to meet my hon. Friend to talk about that in more detail.
Mary Glindon (North Tyneside) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
The Government are cutting fuel duty, at a cost of £5 billion over the next 12 months; raising the employment allowance to £5,000; and zero-rating VAT on energy-saving materials. That builds on existing support, including business rates relief worth £7 billion over five years.
Mary Glindon
Businesses such as Sidhu’s chippies in my constituency had pinned their hopes on the Chancellor reducing VAT to 12.5%. They are now going to be pushed to the brink as energy costs are set to almost triple this financial year. What hope can the Minister offer Sidhu’s and other businesses that have served their local communities for decades but now cannot guarantee jobs and services into the future?
Paul Scully
Our hospitality strategy, which includes fish and chip shops and other restaurants around the country, has a number of workstreams to co-create solutions with businesses rather than the Government having all the answers. The hon. Lady needs to consider the issue in the round, including the business rates relief and other support that we have given of £408 billion over the past two years.
Laura Farris (Newbury) (Con)
Supporting businesses to manage their costs must not come at the expense of employment rights. The P&O ferry scandal is not about fire and rehire, but it puts the issue back in the spotlight because it exposes how vulnerable workers can be when faced with an exploitative employer who is willing to trample over their statutory rights to slash wages. At the Dispatch Box last week, my hon. Friend the Minister intimated that the Government would make further announcements on the issue. May I press him to tell the House today whether the Government are prepared to act definitively on fire and rehire?
Paul Scully
I thank my hon. Friend, who has been a doughty champion on the issue. The Government have always been clear that it is completely unacceptable for any sized business to use threats of fire and rehire simply as a negotiation tactic. We have already taken action. In November last year, we commissioned ACAS, which published guidance. I promised to take further steps, as she rightly said, and I am pleased to announce that we will bring forward a statutory code later this year under section 203 of the Trade Union and Labour Relations (Consolidation) Act 1992. We will introduce that as soon as parliamentary time allows. The code will have legal teeth; it will be admissible in evidence before courts and employment tribunals in England, Scotland and Wales.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
Businesses face a barrage of rising costs: inflation at a 30-year high, taxation at an 80-year high, and rocketing prices for materials, energy, food and fuel that are hitting businesses and consumers hard. This is a Government of photo ops but shuttered shops, with no clear plan to support businesses and workers, and their spring statement does not go far enough. Does that not make Labour’s call for an increase to the small business rates relief threshold even more urgent? Or is the truth not plain to see that small businesses can no longer afford the Conservatives?
Paul Scully
Nobody—whether in a domestic or business setting—can afford Labour. We have put £408 billion of support into wrapping our arms around jobs, livelihoods and businesses. We have 408 billion reasons to get this next bit right. The Labour party can talk about scrapping business rates, but it has not made any suggestion of what to replace them with. Fine words, but we will act.
Karl MᶜCartney (Lincoln) (Con)
Dr Luke Evans (Bosworth) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)
Achieving the UK’s ambitious net zero target to prevent global warming and climate emergency beyond 1.5° and protect consumers from global price volatility will require significant extra investment in renewable electricity generation. We have seen the cost of renewable technologies, most notably offshore wind, reduce fast and as more renewables are added to the system, household electricity bills will be less affected by fluctuations in volatile global gas prices.
Karl MᶜCartney
An effective way for household energy bills in Lincoln and across the UK to be cut by 25% right now is through the removal of the renewables surcharge on everyone’s bills, even temporarily. Have the Minister and his colleagues put that simple idea to their Treasury colleagues?
George Freeman
I can assure my hon. Friend that lots of ideas have been put to Treasury colleagues. The truth is that the falling cost of UK renewables, with offshore wind now down 60% through the contract for difference, is the best protection against global supply chain volatility. This country has led the way. In the past 30 years, we have grown the economy by 78% and reduced emissions by 44%. The Government focused on helping consumers, households and businesses with direct support and that is why the Chancellor announced £9 billion of relief in his February package, £5 billion last week, contrary to the claim from the Opposition that nothing was done, and extra funding for the warm home scheme and winter fuel levy.
Dr Evans
Constituents in Bosworth are concerned about three things: the cost of their energy bills, the environmental impact and the security of our energy supply. While being mindful of those three things, does my hon. Friend agree that a transition period is paramount while we deal with the fallout of a war, with rising energy prices and, of course, with meeting our net zero targets?
George Freeman
My hon. Friend makes an important point that has not been picked up by the Opposition. We are emerging from a global pandemic and experiencing a war in Europe. Those are two unprecedented shocks to the global energy system. The Government have done everything necessary through the pandemic and we are doing it again on energy, but in the end we are in a global energy market and the best strategy, as my hon. Friend sets out, is the transition plan we have put in place, with strong support for renewables and help with the cost of energy in the short term for consumers, businesses and households.
Carol Monaghan (Glasgow North West) (SNP)
For Norway to feed energy into our national grid it costs £1.36 per MWh, for Belgium it is 77p per MWh, for France, 17p and for Germany, Luxembourg and The Netherlands it costs not a penny. Can the Minister explain how Scotland can exploit its renewable potential when it costs £7.36 per MWh to feed into the grid?
George Freeman
I am delighted to explain how Scotland can benefit from our renewables programme: the North sea transition deal, the net zero hydrogen fund, the industrial energy transformation fund, £20 million ringfenced for Scottish tidal, £40 million for carbon capture and storage, and £27 million for the Aberdeen energy transition zone. Frankly, we need fewer complaints from the Scottish nationalists and more support for the Scottish energy sector.
Kerry McCarthy (Bristol East) (Lab)
It is a little disappointing that the Minister could not just give a straightforward no to the question from the hon. Member for Lincoln (Karl MᶜCartney). Moving on, however, there are more than 600 wind and solar projects in the UK that already have planning permission. Will the Government admit they made a mistake in stopping the development of onshore wind, and fast-track those projects? They already have planning permission and are ready to go ahead. They are the answer to meeting our energy needs in the future.
George Freeman
The evidence suggests that the UK is the fastest economy in the G7 in deploying renewables. Offshore wind costs have fallen by 60%. Of course, everyone can do more, but I do not accept the criticism that we have not been in the vanguard; we have been, and we are, and offshore wind and solar have been fundamental to reducing the cost of renewables. That is the best support against rising energy prices.
Patrick Grady (Glasgow North) (SNP)
Alyn Smith (Stirling) (SNP)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)
I am delighted to assure hon. Members that Scotland is at the heart of the UK’s transition to net zero—something I hope they will welcome. In November last year, we committed £20 million to the funding for tidal stream projects through the contracts for difference, giving Scotland’s significant marine energy sector a chance to develop its expertise. We have also allocated £40 million in carbon capture development funding for the Acorn Project and £27 million for the Aberdeen energy transition zone.
Patrick Grady
I am sure the rest of the UK welcomes that contribution to renewable energy as well, but local communities up and down the country, such as Partick in Glasgow North, want to champion the just transition by generating their own local renewable electricity. If the Local Electricity Bill, which has cross-party support on both sides of the House, is brought back in the next Session, will the Government make time and support it?
George Freeman
The hon. Gentleman makes an important point, which I will pass on to my hon. Friend the Energy Minister, who is currently suffering from covid. We have put money into the community energy fund. We are supporting community energy and we are passionate not just about the big infrastructure but, as the hon. Gentleman says, about community energy schemes.
Alyn Smith (Stirling) (SNP)
The University of Stirling has cut its carbon emissions by 43.8% since 2007. It has an ambitious target to achieve net zero by 2040, with fantastic plans for a solar farm, geothermal developments, the repurposing of an existing combined heat and power plant, and hydro. However, it is finding that those developments are held back by a lack of UK Government support and the rhetoric is often not matched by the reality. Will the Minister, in a constructive spirit, meet me to see whether we can crack through the paperwork and support those great projects?
George Freeman
As Minister for Science, Research and Innovation I would be delighted to meet the hon. Gentleman. The university is doing great work. We have just announced and made the allocation of the biggest increase for a generation in science, research and innovation funding for universities, and I would be very happy to meet him and see what we can do to support that cluster.
David Duguid (Banff and Buchan) (Con)
I thank the Minister for reminding the House that this is a transition, not an extinction. Can he confirm that, as part of the North sea transition deal, we need to keep extracting hydrocarbons for the ongoing, albeit declining, demand that we have in this country and to support investment and jobs in that industry? Finally, does he agree that the companies on which the Opposition parties, including the SNP, want to slap an arbitrary windfall tax are precisely those companies that have the skills, the knowledge, the expertise, the technology and the capital to invest in the energy transition that this country desperately needs, and that we can show the world how it is done?
George Freeman
My hon. Friend is absolutely spot on. It is surprising not to hear the Scottish nationalists welcoming the North sea transition deal a bit more. To remind the House, it is a programme that will draw on the expertise in Scotland’s offshore North sea oil and gas sector and help it to lead the transition to carbon capture and storage, hydrogen, offshore wind and tidal, and it is set to create over 40,000 jobs and attract £14 billion of investment. That is the best way—and frankly, the best thing the SNP here could do is to help their colleagues in Scotland to support it.
Greg Smith (Buckingham) (Con)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Lee Rowley)
The net zero strategy highlighted the potential importance of sustainable and synthetic fuels as part of the transition to net zero and committed to additional strategies. In aviation, the Government have already announced their ambition to deliver 10% sustainable aviation fuels by 2030.
Greg Smith
In our inquiry, “Fuelling the future”, the Transport Committee has heard significant evidence of the role that synthetic fuels can play as drop-in fuels that mean that vehicles, aircraft, ships, cars and plant do not have to be changed—the fuel just works in them. Given this, will my hon. Friend commit to ensure that synthetic fuels and their development are given equal billing with other energy sources?
Lee Rowley
My hon. Friend makes two crucial points: first, that technological innovation—the ingenuity of human endeavour—is crucially important in helping us to get to net zero in the first place; and secondly, that it is very important that we let a multitude of technologies and innovations grow and develop, working in conjunction with private enterprise, to help to solve society’s challenges.
Caroline Lucas (Brighton, Pavilion) (Green)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Lee Rowley)
The North Sea Transition Authority decided to change its name to reflect its important role in the energy transition, driving the UK upstream oil and gas industry towards net zero. My right hon. Friend the Secretary of State was consulted on and supported this change.
Caroline Lucas
No amount of greenwash can hide the fact that the Oil and Gas Authority’s primary purpose is to pump every last drop of oil and gas from the North sea, but the International Energy Agency report that was commissioned by this Government is clear that there can be no new exploration for fossil fuels. Let me pre-empt the Minister’s response by saying that no one is suggesting turning off the taps tomorrow, as he regularly claims. We absolutely need a transition that is fair to workers; what we do not need is a so-called climate pass to allow the Government to ignore climate consequences and license more explorations supposedly on the grounds of national security. Can he assure us that he recognises that climate change is itself an issue of national security, and that if we are serious about our net zero commitments there can be no exemptions from the climate compatibility checkpoints?
Lee Rowley
If the hon. Lady accepts the principle of transition, then she needs to accept the principle that we will need oil and gas for a number of years yet. That is logical, simple and understood. The only greenwashing that is going on is the Green party pretending that it is interested in green issues when it is only interested in socialism.
Munira Wilson (Twickenham) (LD)
The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)
Since we last met, my Department has been focused on three central strands. First, we are pleased to announce the passing of the Economic Crime (Transparency and Enforcement) Act 2022. Secondly, we have worked with Ukrainian colleagues to make sure that generators are arriving in Ukraine so that their public services can be powered and delivered. Thirdly, I am pleased to announce that we are phasing out imports of Russian oil over a nine-month period to make sure, with our allies, that the Kremlin does not benefit from its sale of hydrocarbons.
Munira Wilson
Small businesses across my constituency are struggling, like households, with spiralling energy costs. The British Chambers of Commerce reports that three out of four firms it surveyed will be passing on these costs to customers through higher prices, thus further fuelling the cost of living crisis for many people in Twickenham and across the country. What will the Secretary of State do to alleviate the pressure on small and medium-sized enterprises that are facing rising energy bills?
Kwasi Kwarteng
The hon. Lady will know that not only did my right hon. Friend the Chancellor of the Exchequer announce a £9 billion package particularly for the most vulnerable, but for all our citizens, a few weeks ago, but last week we announced a support package, again, for vulnerable customers. In relation to small business, she will know that over the past two years this Government have spent £405 billion in supporting businesses of all sizes through a very difficult pandemic and, again, through the heightened crisis that has been brought on by the Russian invasion of Ukraine.
Several hon. Members rose—
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)
It is great that my hon. Friend is supporting Rodale and other companies in her area. We know that this is a worrying time for business, which is facing significant increases in global gas prices. My right hon. Friend the Business Secretary is in regular contact with the energy industry and Ofgem to manage the impact of price increases on businesses. Clearly, we need to look at this in the round, and in the context of the £408 billion that we provided throughout covid to allow businesses such as Rodale to survive.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Last October the Secretary of State promised support for energy-intensive industries such as steel, glass and ceramics. His exact words were that it was his
“priority…to ensure costs are managed and supplies of energy are maintained.”
Yet six months later there is still no action, and there was nothing in last week’s spring statement, so when will this promised support be presented?
Kwasi Kwarteng
The hon. Gentleman will know that support is ongoing. We have the industrial energy transformation fund, which has allocated more than £50 million. We have also supported EIIs—energy-intensive industries—to the tune of £2 billion since 2013, so support is always there and has been ongoing.
Jonathan Reynolds
A chemicals manufacturer in Grimsby has been in touch with me this week. Its energy bill last year was £10 million; it has now gone up to £50 million a year. And it gets worse, because as we have heard in questions today, in two days’ time, compensation for the UK emissions trading scheme and the carbon price support mechanism comes to an end, so support is actually decreasing. Will the Secretary of State at least do the bare minimum and reassure firms today that that support fund will be extended?
Kwasi Kwarteng
I will reassure businesses that I engage with that we are constantly engaging in conversations with our Treasury colleagues and across Government to see how best we can use the existing schemes to support industries—the steel industry, ceramics industry and chemicals industry—in this difficult time.
Jack Brereton (Stoke-on-Trent South) (Con)
Paul Scully
It was a pleasure to speak to the Staffordshire chamber of commerce. The Department for Work and Pensions’ “Way to Work” campaign is a drive to help employers to fill vacancies faster by streamlining recruitment processes and offering employers a named adviser. The Department is also supporting people to upskill through skills boot camps and sector-based work academies.
Cat Smith (Lancaster and Fleetwood) (Lab)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)
As former Minister for life science and Minister for research, I would be very happy to meet with the hon. Member to talk that through. We have just made the biggest allocation for science, research and innovation, which included £9 billion for health research.
Jason McCartney (Colne Valley) (Con)
Kwasi Kwarteng
My hon. Friend knows that energy efficiency is at the centre of any net zero strategy, and I would be happy to work with him to ensure that we can drive progress in this area.
Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)
Kwasi Kwarteng
The hon. Gentleman will appreciate that the Department continually looks at a range of schemes to see how best we can lighten the burden of rising energy prices.
Bim Afolami (Hitchin and Harpenden) (Con)
George Freeman
That is an excellent question. We can be very proud: UK scientists at Harwell recently demonstrated the ability to generate temperatures equivalent to those on the sun at the flick of a switch, and Rolls-Royce is ready to roll out and industrialise small nuclear reactors over the next 10 to 15 years. We are looking to accelerate their deployment to help tackle the global energy crisis.
Beth Winter (Cynon Valley) (Lab)
Kwasi Kwarteng
As the hon. Lady is aware, we have made a number of interventions that have gone some way to lightening the burden. There is the £9 billion that my right hon. Friend the Chancellor announced a few weeks ago, and £150 off council tax for those in bands A to D. I have reassured the House that we are looking at a range of measures to see how best we can meet the challenge of the next few months. Nobody knows where the price cap will be in October.
Theresa Villiers (Chipping Barnet) (Con)
Kwasi Kwarteng
My right hon. Friend is absolutely right to identify this as an issue. That is why we are working, not only in Government but across G7 partners, to ensure diverse sources of energy supply, which can keep prices down.
Liz Twist (Blaydon) (Lab)
In Chopwell in my constituency, over 200 homes were due to benefit from cladding under the green homes grant local authority delivery scheme, but due to escalating costs, that work has been cancelled. Will the Minister meet me to discuss how we can ensure that the work is carried out?
Kwasi Kwarteng
As the hon. Lady knows, local authority delivery of the green homes grant was very successful, but I would be very happy to meet her to discuss the case she mentions.
Dame Caroline Dinenage (Gosport) (Con)
Last year, my right hon. Friend the Secretary of State made the welcome announcement that employment leave would be extended to unpaid carers. Will he please update the House on when that is likely to be delivered?
Paul Scully
I recommit to our manifesto commitment to introduce carers’ leave. That will be introduced as soon as parliamentary time allows. We are looking forward to getting on with that as soon as possible.
Dan Jarvis (Barnsley Central) (Lab)
South Yorkshire is home to some extraordinary research and development assets, including the University of Sheffield Advanced Manufacturing Research Centre and the Advanced Wellbeing and Research Centre. It was great to meet the Minister recently to discuss the issue. Will he continue to work with me and others on unlocking the undoubtedly huge potential in South Yorkshire?
George Freeman
With absolute pleasure. The South Yorkshire cluster is becoming a world-class, globally recognised leader in advanced manufacturing and associated industries. I look forward to supporting that cluster.
Lee Anderson (Ashfield) (Con)
Geothermal energy from old coalmines can heat our homes for years to come. Will the Secretary of State please assure me that he is doing all he can to support the Coal Authority in developing this fantastic new energy opportunity?
Kwasi Kwarteng
We are, absolutely, excited about the prospects for geothermal. I would be very happy to meet the hon. Gentleman to discuss this. I was happy, also, to talk to my Cornish colleagues about this exciting new technology; it is something on which we are focused.
Joanna Cherry (Edinburgh South West) (SNP)
The pupils of Boroughmuir High School’s climate change society in my constituency have impressed on me that their generation is relying on us to take action right now, because by the time they are old enough to do so it will be too late for systemic change. Can the Secretary of State reassure school students in my constituency that his plans for transition have the requisite urgency?
Kwasi Kwarteng
They do. I was very pleased to take up my office as Minister of State for Energy a month after the net zero legislation was passed, and for the last three years we have been resolutely focused on living up to the letter of the law, fulfilling our bargain and making sure we reach net zero in 2050.
Martin Vickers (Cleethorpes) (Con)
The Secretary of State is well aware of the opportunities for further developing the renewables sector in my Cleethorpes constituency and the wider Humber region. However, as he is also aware, there have been one or two setbacks of late. Will he meet me and neighbouring colleagues to discuss how we can move forward and maximise such opportunities?
Kwasi Kwarteng
I would be very happy to meet my hon. Friend. I am very excited about what is going on in his constituency and the wider Humber area, and I look forward to talking to him about decarbonisation.
Kate Green (Stretford and Urmston) (Lab)
Unscrupulous company directors make use of the compulsory strike-off process to avoid paying debts to both private and public sector creditors. In considering reform of Companies House, what can Ministers do to tackle this practice?
Paul Scully
We are looking at a range of methods of reforming Companies House, including unscrupulous behaviour by directors. It will be the biggest upheaval of companies law for the last 150 years, and we will legislate for new powers in the economic crime Bill when parliamentary time allows.
Holly Mumby-Croft (Scunthorpe) (Con)
My right hon. Friend will know that there is a distinct difference between the current energy price spikes and the long-standing unfairness that UK steel makers face when it comes to the charges and levies they pay on their energy costs. Does he agree that, when the energy strategy that the Prime Minister promised comes out, it must address both these distinct and separate issues?
Kwasi Kwarteng
I would be happy to talk to my hon. Friend about those issues. I would like to point out that we had a significant victory in extending the safeguards last summer, and there has been some very good news on trade talks about the quotas that steel companies in this country are allowed by the US.
Marsha De Cordova (Battersea) (Lab)
The energy crisis is leaving some people in my constituency struggling to pay their bills, and the situation is even worse for those whose heating is paid for centrally and is not protected by the energy price cap. In some cases, many have seen their bills go up by more than 500%, so when will the Secretary of State bring forward legislation that will give Ofgem the powers to regulate these prices and end these excessive energy price increases?
Kwasi Kwarteng
The hon. Member will know that we are speaking with Ofgem about this very issue. Yes, the price cap does protect the vast majority of people, but there is an issue with people off grid, which I would be very happy to talk to her about.
Mr Richard Holden (North West Durham) (Con)
There is great concern in North West Durham among constituents affected by Storm Arwen about the prospect of being left without a landline as well as without power during a storm, due to the switch to the voice over internet protocol. Given that, does the Secretary of State, like me, welcome the announcement from BT today that this forced switch will now be paused and be on request only, as BT looks to ensure that proper back-up systems are in place during power cuts before returning to the broader roll-out?
Kwasi Kwarteng
I welcome the announcement. I was also very pleased to spend time with my hon. Friend in the unfortunate circumstances of Storm Arwen, and I look forward to the publication of that report soon.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Returning to off grid, Ofgem’s mission statement says that it aims
“to make a positive difference for all energy consumers, both now and in the future”,
yet off-gas grid consumers using electricity, oil and liquid gas face price rises in April four times that of Ofgem’s average consumer. Will the Secretary of State support my calls to regulate this for off-gas grid customers through Ofgem, and indeed support my Energy Pricing (Off Gas Grid Households) Bill?
Kwasi Kwarteng
Where I agree with the hon. Gentleman is that we need to have a more robust offer for people who are off grid. This issue has been raised continually in these exceptional times, and I look forward to speaking to Ofgem—and perhaps him—about these issues.
Several hon. Members rose—