Draft Pollution Prevention and Control (Fees) (Miscellaneous Amendments) Regulations 2025
(2 days, 2 hours ago)
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The Minister of State, Department for Energy Security and Net Zero (Sarah Jones)
I beg to move,
That the Committee has considered the draft Pollution Prevention and Control (Fees) (Miscellaneous Amendments) Regulations 2025.
It is a pleasure to serve under your chairmanship, Dr Murrison. The draft regulations were laid before the House on 23 April. Before outlining the provisions, I will briefly provide some context. The Department for Energy Security and Net Zero’s Offshore Petroleum Regulator for Environment and Decommissioning—OPRED—minimises the offshore sector’s impact on the environment by controlling air emissions and discharges to sea, and by reducing disturbance over the life cycle of operations, from seismic surveys through to post-decommissioning monitoring.
OPRED recoups the eligible costs of its regulatory functions from industry in the oil and gas offshore sector, to which I shall refer as the offshore sector, rather than from the taxpayer. OPRED’s recoverable costs are covered in two ways: first, by using the fees regulations; and secondly, by five charging schemes that do not require legislative change and will be amended administratively.
OPRED’s annual fees income is around £6.7 million, recovered from about 100 companies. Currently, the fees that it charges are based on hourly rates of £201 for environmental specialists and £104 for non-specialists. Environmental specialists are technical staff who carry out the functions of the Secretary of State, and non-specialists are support staff.
The current hourly rates have been in force since June 2022. Having reviewed the cost base, OPRED concluded that the existing rates need to be revised to reflect today’s costs for regulatory services. The fees regulations will therefore amend the charging provisions by increasing the hourly rate to £210 for environmental specialists and to £114 for non-specialists. OPRED’s fees are determined by adding the recorded number of hours worked per person on cost-recoverable activities and multiplying them by the hourly rates for environmental specialists and non-specialists, respectively.
The new hourly rates were approved by His Majesty’s Treasury in December 2024 and were calculated in line with the Treasury’s “Managing public money” guidance. They cover the expenditure on all resources used by OPRED to support its activities, such as staff salaries, accommodation, IT and legal services. There is no formal requirement to consult on the proposed changes. However, OPRED informed the offshore sector of the planned revisions to the hourly rates in February 2025, and no representations were received. OPRED’s fees regime guidance will be revised to reflect the new hourly rates.
I conclude by emphasising that this revision to the hourly rates will allow OPRED to recover the eligible costs of providing regulatory services from those who benefit from them, rather than passing on the costs to the taxpayer. I hope that hon. Members will support this measure, and I commend the draft fees regulations to the Committee.
Nick Timothy (West Suffolk) (Con)
It is a pleasure to serve under your chairmanship this afternoon, Dr Murrison. I am pleased to respond to the draft regulations on behalf of His Majesty’s Opposition. This legislation, as we have just heard, will increase the hourly rate of fees charged under environmental regulations related to the offshore oil and gas industry. There may not be an impact assessment for this specific change, but it is part of a broader shift in energy policy that is increasing costs and threatening the viability of our offshore industries.
It is, I am afraid, economic madness to refuse to issue new licences in the North sea and to tax the oil and gas sector out of existence. Doing so only makes us more dependent on dirtier foreign imports—imported liquefied natural gas produces four times the emissions of North sea oil and gas. It also puts around 120,000 jobs at risk and will lead to less revenue for the Exchequer in the long run, at a time when the public finances are under strain.
I invite the Minister to see the madness of that approach. We are refusing to drill for our own natural resources while importing Norwegian oil and gas drilled from the very same seabed, impoverishing ourselves and enriching the Norwegians. The company profits, the jobs, the prosperity and security, the tax revenues—it all goes to Norway when it could be ours. It is surely no coincidence that we now have the highest industrial energy prices in Europe, while data published yesterday shows that the output of our energy-intensive industries has fallen to a 35-year low.
Removing oil and gas from the equation is an ideological and destructive move. It does not serve our national interest or help our struggling industries. The Government should be much more hard-headed about their approach to energy. Lower prices, more jobs, higher growth and stronger revenue, not ideology, should be the objectives. Instead, the Secretary of State for Energy Security and Net Zero is driving us towards economic and national decline.
Sarah Jones
Although it was unclear, I think the Opposition support these regulations. If they do, I am grateful. We do not need to replay the arguments about the dash to clean power, which is the only way to bring down our energy costs in the long term. We do not need to rehearse the fact that the North sea is a declining basin that has seen 70,000 job losses over the last few years.
Jerome Mayhew (Broadland and Fakenham) (Con)
Given the Government’s best case is that the UK economy will import gas, particularly from Norway, until 2050 and beyond, does the Minister not concede that, since we are going to be using gas, it would be better for our balance of payments if we produced that gas in this country, even from a declining basin?
Sarah Jones
Gas is still being produced in this country, and that will continue for many years to come, as the hon. Gentleman knows. We could rehearse these arguments, but I am not sure they are pertinent to these draft regulations. I will just celebrate the fact that we are now the fastest-growing economy in the G7 and that the economy, more broadly, is on the up—long may that continue. I thank the Opposition for their support for the draft regulations.
Question put and agreed to.