Smart Meters Bill (First sitting)
Alan Whitehead ExcerptsTuesday 21st November 2017
(7 years ago)
Public Bill CommitteesRead Full debate Smart Meters Act 2018 View all Smart Meters Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 21 November 2017 - (21 Nov 2017)
Dr Alan Whitehead (Southampton, Test) (Lab)
Q
Audrey Gallacher: It is important that the Business, Energy and Industrial Strategy Committee and the Government maintain sufficient routine oversight over the programme. The extension is to allow that programme to be delivered so that consumers get the benefit. We know that the scheme is due to finish in 2020. There is clearly a question about whether that will happen fully, so it is important that that oversight is retained. We would be concerned about how any future powers are used and that due process is followed, and about all the other attendant requirements around any regulated area.
Bill Bullen: We do not think that the 2020 deadline is realistic, and I reiterate the need for continued administrative powers post 2020. The deadline will not be met, so it is essential that those powers are continued.
Dr Whitehead
Q
Bill Bullen: I just do not think that the programme is anywhere near the level of completion that it needs to be. The DCC was originally intended to be up and running in 2014, at which point 2020 was perhaps a realistic timeframe. We are now nearly at the end of 2017, and the DCC is clearly not up and running at anything like full capacity. It will just not be possible to deliver the remaining 40 million–plus meters in three years. It is logistically impossible.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
Q
Bill Bullen: Business is completely focused on the prepay market. We have nearly 600,000 prepay customers now, and more than 85% of those already have smart meters installed. The prepay market in total is something like 20% of the market—5 million households in the UK use prepay, and about 20% of those already have smart meters installed. There is a very simple reason for that: it completely transforms that product and service for those customers. It has huge value benefits for prepay households, which is why they have adopted the technology more quickly. Until the price cap came in, there were also significant price reductions because prepay smart meters allow people to cut their cost to serve ratio, and therefore they deliver a better price as well as a better product. It is a bit of a no-brainer, to be honest.
Audrey Gallacher: I echo that. We know from a lot of early research done on the Government’s smart meter programme that the customer service benefits go beyond improvements and engagement in reducing consumption. The sheer customer service benefits have been massive. Right now, people have to go outside the house to top up their meter, but with a smart meter they can do that in their home. As Bill says, that has proved massively popular.
Laura Smith
Q
Rob Salter-Church: That is a good challenge. We gather regular information by engaging with Citizens Advice, which is a good source of information if people are raising concerns or complaints about their smart metering installation. As I mentioned before, we also gather information from the smart metering installation code of practice survey. We gather information from a wide range of sources. If we thought there was a systematic problem and suppliers were not being clear to customers about information consent, we would absolutely do something about it and use all the powers that we have to crack down on those suppliers and make sure that consumers are protected. I hope I can reassure you that we have both the practical arrangements in place to get the data and the will to do something if we see that there is a real problem.
Dr Whitehead
Q
Angus Flett: I can reassure the Committee that DCC is fully operational and ready to scale. If we look at the facts, DCC was born in 2013. Our first release was due in December 2015 and was actually delivered in October 2016—the following year. The latest release, which was due in November, we delivered bang on track. There are subsequent releases to unlock functionality such as prepaid and so on.
We run regular “ready to scale” forums with our suppliers and customers. The forecasts that are coming through from my main customers indicate that I will be doing well over 200,000 installs a week next year, and that number is growing. In fact, one of my main customers issued a press release saying that it was the first to go live with the installation of SMETS 2. We are also putting in place incremental measures to ensure that, as we cut over from SMETS 1 to SMETS 2, we carry a buffer stock of communications hubs so that my customers can ramp down their old stock and ramp up the new stock. We are confident that we can deliver against the scaling requirements.
Dr Whitehead
Q
Angus Flett: Testing is essential. This is a UK national infrastructure project and we will not go live without full integrated testing. We use a range of emulators to simulate testing. As I said, the evidence I have from the main customers that are driving installations is that we are on track. The volumetric forecasts that they are delivering to me indicate well over 200,000 installs a week. I do not have concerns in that sense.
Dr Whitehead
Q
Angus Flett: There are just over 250 out there at the moment.
Dr Whitehead
Q
Angus Flett: At this stage it is an acceptable number, as each of my main customers gears up its volumetric installs. As I said, if the forecasts that come through—
Nuclear Safeguards Bill (Fifth sitting)
Alan Whitehead ExcerptsTuesday 14th November 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 14 November 2017 - (14 Nov 2017)
The Chair
Welcome back to the Committee stage of the Nuclear Safeguards Bill. I am a very old-fashioned sort of Chairman, but in the old days we did not bring coats, bags and things into the Room, and if we did we secreted them away in such a manner as not to make it obvious that we did not know where the cloakroom was. That is just for the future. It is a very small matter of no significance.
Schedule
Minor and consequential amendments
Dr Alan Whitehead (Southampton, Test) (Lab)
I beg to move amendment 9, in schedule, page 6, line 37, leave out subparagraph (2)(a).
This amendment, together with 10 and 11, would change the Parliamentary procedure for regulations made under Clause 1 to come into force. Currently regulations under this section are only subject to the affirmative procedure on first use. This amendment would ensure this is the case upon every use.
The Chair
With this it will be convenient to discuss the following:
Amendment 10, in schedule, page 7, line 3, at beginning insert—
“(zaa) nuclear safeguards regulations under section 76A(1)”.
This amendment, together with amendments 9 and 11, would change the Parliamentary procedure for regulations made under Clause 1 to come into force. Currently regulations under this section are only subject to the affirmative procedure on first use. This amendment would ensure this is the case upon every use.
Amendment 11, in schedule, page 7, line 6, leave out subparagraph (3).
This amendment, together with amendments 9 and 10, would change the Parliamentary procedure for regulations made under Clause 1 to come into force. Currently regulations under this section are only subject to the affirmative procedure on first use. This amendment would ensure this is the case upon every use.
Dr Whitehead
If I do have a bag on me this morning, it is very well secreted. You would expect nothing less, Mr Gray.
These amendments are essentially combined amendments, inasmuch as their effect—although it is achieved in slightly different ways—is to ensure that the regulations are made effective by the affirmative procedure on all occasions, so that they can be discussed. At the moment, through various measures in the Bill, regulations will be agreed by the affirmative procedure in the first instance only. Should further regulations be introduced, they will not be agreed by the affirmative procedure.
Hon. Members may think that is not a particularly important distinction. The “Memorandum concerning the Delegated Powers in the Nuclear Safeguards Bill for the Delegated Powers and Regulatory Reform Committee” —the departmental memo—says:
“The first set of regulations made under this power will be subject to the draft affirmative procedure in order to allow both Houses of Parliament to debate the technical details of the new regime in full.”
In other words, new regulations will be introduced to bring into being a new regime, as we recall from our previous discussions in this Committee, to replace that which was previously undertaken through Euratom’s oversight.
“Subsequent regulations will be subject to the negative resolution procedure unless they create new criminal offences or they include any provision amending or repealing the Nuclear Installations Act 1965 or Nuclear Safeguards Act 2000, in which case the draft affirmative procedure will apply (pursuant to section 113(3) of the 2013 Act).”
That is so. There is an exception to using the negative procedure for subsequent regulations in those instances, but the impression that one gets from the memorandum is that the difference, other than on the matter of repealing the Nuclear Installations Act 1965 or the Nuclear Safeguards Act 2000, is very slight.
I suggest to the Committee that the significance of subsequent regulations can be considerable, inasmuch as they are new regulations that will replace Euratom’s regulations, and will not necessarily be fully formed in the first instance. As far as I can see, it is not the case that they are likely to be minor tidy-ups that are of no consequence and therefore can safely be provided for under negative resolution.
Dan Carden (Liverpool, Walton) (Lab)
With the affirmative procedure, it is not as if we have any great scrutiny power, but it at least allows us to have a debate in a Committee Room such as this. Has my hon. Friend had any indication that the Minister is opposed to debates about future regulations relating to nuclear safeguards?
Dr Whitehead
My hon. Friend makes an important point: the affirmative procedure is actually fairly limited. What we discuss in Committee is unamendable and our scrutiny is often pretty perfunctory. Nevertheless, it at least guarantees that something will be brought to somewhere in Parliament, and the opportunity to discuss it is not dependent on the Government’s largesse. It is at least a minimal protection, as far as Parliament is concerned, and it guarantees that something will be brought to the Floor of the House. Importantly, the negative procedure does not do that.
I hope the Minister will reflect on the fact that, because we are introducing such a wide-ranging enabling Bill, it is important that the regulations have proper scrutiny subsequently. We must not simply sign a blank cheque for the future and allow anyone making the regulations to do what they want. It is an important principle in this House that we do not do that under anything but the most minimal circumstances, and in this instance I suggest that those minimal circumstances do not exist.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
Good morning, everybody. I thank the hon. Member for Southampton, Test for his contribution relating to amendments 9, 10 and 11. I have spent quite a lot of time thinking about them and about how practical his suggestion is.
I apologise to the hon. Gentleman and the Committee as I do not have the draft regulations for the Committee. We discussed them the week before last, but I was eager to secure this slot so that the Bill could progress. Discussions with the Office for Nuclear Regulation are well advanced, and I hope that, before we discuss the Bill further—definitely by January—they will be published for all hon. Members and a wider audience to see. They are not secret regulations or anything particularly devious. It is simply because of the logistics of organising them along with the Bill that we have not published them in time.
I should set out this provision in the same way as the hon. Gentleman did. Clause 1(2) creates new powers to enable the Secretary of State to make regulations for the purpose of ensuring that qualifying nuclear material, facilities or equipment are available only for the use for civil activities. To do that, clause 1(2) inserts new section 76A into the Energy Act 2013. Section 76A provides the Secretary of State with new regulation-making powers relating to nuclear safeguards. The regulations will set out the detail of the domestic regime for civil nuclear safeguards.
It is appropriate to make provision for a nuclear safeguards regime in delegated legislation, simply because the subject matter is highly technical and the substantive provisions necessary to give effect to the regime will be very detailed. That is why we believe that it has to be in secondary legislation.
Dr Whitehead
I am not sure that we are able to withdraw them. The Minister has helpfully set out the line of thinking behind putting in place affirmative procedure the first time round, and negative procedure subsequently, but he has not departed in any way from the memorandum that was set out in the first instance, from which I quoted this morning. Therefore, no reassurance has been given that the Opposition have wrongly interpreted particular procedures, or that the regulations that the Minister has talked about really will be of the very minor nature that he suggested. He has not addressed that point at all.
Alex Norris (Nottingham North) (Lab/Co-op)
Having listened to the discussion on affirmative procedure, does my hon. Friend agree that it is not inevitable—indeed, given the complications, it is quite unlikely—that every subsequent decision would be merely technical, and could be safely dealt with under negative procedure?
Dr Whitehead
My hon. Friend is absolutely right. That is underlined by the fact that, as has been alluded to on several occasions, we are not talking about a common or garden piece of legislation that simply places something on top of something else and thereby moves us forward. We are talking about a complete replacement for something that existed previously and will no longer exist. It will have no back-up or reference if we have not got everything in new regulations, replacing the previous regulations that no longer exist or have any currency as far as the UK is concerned.
With this legislation, we would be placing it on trust that everyone had got everything right first time as far as the new regulations were concerned, yet it has been stated in Committee that it is quite possible that there will be further amendments to those regulations, because we will need to be ready on exit day for the basic provision—
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
Is it not true that the aspects of the Bill that the Minister described as “non-controversial” would be so were we staying in Euratom? However, because we will have to move to a new system and there can be no guarantee, as the Minister himself said, of having the professionals in place to deliver the regulations, there are likely to be new regulations. We must therefore have these protections in order to scrutinise them.
Dr Whitehead
The hon. Gentleman is quite right. The procedure that we are looking at is very likely, in my view, to lead to far more than technical changes. Because there is a body of existing legislation, technical changes can be made, and to some extent I agree with that, because that is how the House works on occasion. If the Government are considering minor or technical changes, simply updating legislation to make it compatible with other pieces of legislation, or proposing to make the regulations in one Bill compatible with new regulations in another, that goes through under the negative procedure, and everyone accepts in the House that that is how we do it.
Lots of things go through in that non-controversial nature. I accept that, but it is not the case here. That is not what we are doing. As the hon. Member for Inverness, Nairn, Badenoch and Strathspey said, we are not tweaking or amending something, but providing something absolutely new. We hope it will be okay, but I think we freely agree that there will be a number of occasions when quite important subsequent regulations will need to be made to beef up the procedure, because even though it is on the road on day one, it is not necessarily as good as it might be. Indeed, the Committee heard that in evidence. We have not had any assurances this morning that we have misunderstood how the new regulations will work or that guarantees can be given that they will be of the technical nature we are more used to in ordinary dealings.
Dr Whitehead
Perhaps I could deal with my hon. Friend’s intervention, and then I am happy to give way again.
Dr Whitehead
Of course, Mr Gray. Within the context of the Bill, an associated issue is the extent to which Parliament has a hand in ensuring that the regulations are as good as they should be. In taking this grave step by reinventing a complete set of regulations, a complete regime and a complete landscape, parliamentary sovereignty has to be respected. It is important that we get that right in the legislation, and it is important that we get the regulations right subsequently.
Richard Harrington
The hon. Gentleman is perfectly at liberty, as he knows, to press this to a vote. I have tried, as he has, to find common ground, but obviously he feels that I have not done so in this case. It is true that our positions are much the same as they were before we stood up to speak today. Although he has the ability to press this to a vote, I wonder if he would be interested instead in talking about this in other discussions before Report to see if there is common ground. I feel that the majority of the regulations are technical, and the affirmative procedure is perfectly acceptable, but if there were a way of separating the two issues so that he and I could discuss it with colleagues, I would be very happy to.
Dr Whitehead
I thank the Minister for that intervention and for what I think—I am reading the tea leaves a little bit here—is a slight softening of the position that it is all okay and there is nothing to worry about.
Richard Harrington
This is not a softening of the position. I am genuinely trying to explore whether there is a way of separating the vast majority of technical regulations, for which it would be very impractical to do what the hon. Gentleman wants, from things he has mentioned that may be of a different nature. My position remains the same. As I say, he is perfectly at liberty to press this to a vote, but I am happy to talk with him at one of the meetings we are having on other matters so that he can explain further his position and we can see if we can reach an agreement.
Dr Whitehead
Well, let us see whether we can talk about a mellowing of the position rather than a softening of the position.
What the Minister has importantly alluded to is the fact that if subsequent amendments to the regulations that we have highlighted are really just issues of a wholly technical nature and are, as I have described them, part of the bread and butter machinery of this House in terms of undertaking things by negative resolution, Members can simply say, “Yes, that is fine. Provided they are published and one sees them, one has the opportunity, perhaps informally, to say, ‘Well, actually, maybe these are not drafted as well as they should be, but in general there is no controversy attached to those technical changes.’”
However, if subsequent changes to these regulations are clearly not of a wholly technical nature, perhaps they could be flagged in the Bill as being an exception to those arrangements of a purely technical nature, as indeed there already are in the Bill two instances where negative resolution procedure does not apply. So, it is not the case that there is no precedent for this change, because it has already been envisaged that there are circumstances under which the negative resolution procedure will not apply.
If, let us say, on Report it might be possible to add a line to those particular exceptions, then we might have the basis for something we could discuss further. If that is the sort of thing that is possibly in the Minister’s mind, I would be happy to discuss it further with him, to see whether something could be drafted in the Bill that is able to make the distinction that he quite rightly and properly made between what is technical and what is not technical, subsequent to the first regulations being laid.
Richard Harrington
I would like to confirm to the hon. Gentleman that I do not want to make him an undertaking that I cannot carry through, because I would like to discuss this matter further with him, but in good faith I am perfectly prepared to—I would not really use the word “mellowing”. I cannot think of another word at this time of the morning. However, in the spirit that he knows, I am happy to fully explore the matter. Perhaps lawyers might say, “without prejudice” or “subject to contract”, but it just seems to me that there might be a way in which we could be in agreement.
Dr Whitehead
On that basis—and clearly we need a lexicographer here this morning as we discuss these circumstances—I am happy not to press the amendment to a vote, and I hope that we can discuss these issues during the passage of the Bill, to see whether we can make any progress.
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Dr Whitehead
I beg to move amendment 14, page 7, line 13, leave out from “provisions” to end of line 16
Paragraph 3(5) of Schedule 8 to the Energy Act 2013 exempts inspectors’ powers from provisions related to nuclear safeguards. This amendment includes nuclear safeguards in inspectors’ powers.
This amendment looks like a tiny amendment, but I will suggest that in practice it is a substantial amendment, and I will spend a little time explaining why.
The amendment is about the paragraph in the schedule where amendments are made to schedule 8 to the Energy Act 2013 concerning the powers and duties of inspectors. We will all recall that we have already talked about inspectors at some length in this Committee, but what we have talked about is their existence, their skills, their training and their appropriateness for undertaking inspection on nuclear safeguards in replacement of the inspections by inspectors under the auspices of Euratom.
At the moment, the vast majority of inspectors involved in nuclear safeguarding in this country are not under the auspices of the ONR. A small number of people are involved in that process, but the majority work under Euratom and Commission Regulation (Euratom) 302/2005, which, among many other things, sets out the terms under which inspectors work as far as Euratom is concerned. Inspectors go into establishments for the purposes of safeguarding, and they have a number of powers regarding what they can do, look at, and require to be provided, and what changes they can make. All that is done under the auspices of Euratom. The Bill effectively proposes that all those powers, and the authority of inspectors to undertake those inspections, is transferred bodily from Euratom to the oversight of the ONR, and that the ONR will subsequently be responsible for the exercise of those powers and the supervisions of the inspectors as they go about their business.
In every area other than nuclear safeguarding, the powers, duties and responsibilities of inspectors are laid out as far as the ONR is concerned in schedule 8 of the Energy Act 2013. Paragraph 2(1) of schedule 8 contains a brief description of how those powers are organised and invested in the inspectors, and how they are carried out. It states:
“An inspector’s instrument of appointment may authorise the inspector to exercise any relevant power.
Authority to exercise a relevant power may be given—
(a) without restriction, or
(b) only to a limited extent or for limited purposes.”
It then states:
“For the purposes of this Schedule, an inspector is ‘authorised’, in relation to a power, if and so far as the inspector is authorised by the instrument of appointment to exercise the power.”
An instrument of appointment must be provided by, in this instance, the ONR, and as far as I can see—[Interruption.] I am so sorry, Mr Gray. That was a phone-a-friend moment—I was short of inspiration. The instrument of appointment is, in the provisions for inspectors in the Energy Act, more like a passport held by the inspector. The Act states:
“When exercising or seeking to exercise any relevant power, an inspector must, if asked, produce the instrument of appointment (including any instrument varying it) or a duly authenticated copy.”
An inspector has an instrument of appointment that is proof that they have all the powers, duties and responsibilities set out in the legislation. Those duties, powers and responsibilities are also set out in subsequent legislation. An inspector can authorise the issuing of improvement notices or issue prohibition notices. An inspector in pursuit of those notices has a power of entry. They have a power to take persons and equipment into premises. They have powers to cause articles or substances to be dismantled or tested and they have powers to take possession of any article or substance. They have powers to require information and to receive accounts and various other things.
Inspectors therefore have fairly extensive powers authorised under the legislation, except that all those powers, as currently set out, do not apply to nuclear safeguarding. They do not apply to nuclear safeguarding because they were specifically excluded, certainly as far as issuing prohibition notices and having the power to issue improvement notices are concerned, in paragraph 3(5) of schedule 8 to the 2013 legislation.
Paragraph (5)(a) states:
“In this paragraph “applicable provision” means—
(a) any of the relevant statutory provisions other than—
(i) a provision of the Nuclear Safeguards Act 2000, or
(ii) any provision of nuclear regulations identified in accordance with section 74(9) (requirement for provisions made for nuclear security purposes or nuclear safeguards purposes, or both, to be identified as such),”.
So it is quite clear that, as far as a substantial part of the work of nuclear inspectors is concerned, the intention of the 2013 Act was specifically to exclude any concerns about nuclear safeguarding from those inspectors’ powers and responsibilities. That is quite reasonable, because those powers and responsibilities were carried out by Euratom inspectors. A clear distinction was therefore made that ONR-based inspectors would not have any jurisdiction over nuclear safeguarding.
Now all that is going to change and there are two big questions in front of us. First, is it reasonably possible to translate those powers and responsibilities of inspectors which at present do not refer to nuclear safeguarding into a position where they do refer to nuclear safeguarding? Secondly, is it the case that if we simply hand over en bloc to nuclear inspectors who are undertaking nuclear safeguarding activities, the powers and responsibilities that are set out for purposes other than nuclear safeguarding in the 2013 legislation—which set up the ONR in the first place—those provisions will be wholly adequate for that purpose? Those are the two big questions about nuclear inspectors that we need to ask ourselves.
Would it be desirable, as was the case with the 2013 legislation, that the powers of the inspectors were laid out fully in the Bill? They were not set out in subsequent regulations, because they are such important powers and limitations of powers that it was clearly felt in the 2013 legislation that they should be set out in a separate schedule. It was not something that would be looked at in a Committee Room, subsequent to legislation being passed.
The first question that might arise after addressing how we translate the powers of inspectors into UK legislation is whether we should be conducting an exercise similar to that carried out in the 2013 Bill—that is, whether the legislation should include a schedule that contains the powers of the new inspectors who are carrying out their duties in respect of nuclear safeguarding.
The Chair
Order. While the hon. Gentleman is finding that page, I will interrupt for a second. I think it is the will and flavour of the Committee that we are seeking to make good progress on consideration of the Bill today and, if necessary, Thursday. I hope hon. Members will take note of the fact that we are seeking to do so. Maybe that has given the shadow Minister a moment to find his reference.
Dr Whitehead
It has not, actually, Mr Gray. Because I was listening so carefully to you, I did not entirely get my reference sorted out. I have now found it, so I am grateful for your admonition. I am hopeful that we will make speedy progress in Committee today.
However, I am sure we need to pay attention to this section because it is important in getting the regime right for the wholesale change that we are making to how the provisions for nuclear inspection will be carried out.
The deflection that the Government make in their amending of the 2013 Act relates to section 74(9). I would be pleased if anyone could clarify this for me.
“Nuclear regulations which include any provisions to which any paragraph of subsection (10) applies must identify those provisions as such.”
As in the honoured Marx Brothers “tootsie-frootsie ice cream” sketch, with different form guides and various other things, one must now look at subsection (10).
“This subsection applies to any provisions of nuclear regulations which are made for—
(a) the nuclear security purposes,
(b) the nuclear safeguards purposes, or
(c) both of those purposes,
and for no other purpose.”
They appear to half switch off the prohibition of inspectors from undertaking activities for nuclear safeguarding as well as for non-nuclear safeguarding. They apparently refer not to regulations but to provisions of nuclear regulations. I am not sure whether, by deflecting to that paragraph, the responsibilities of nuclear inspectors are wholly translated into what is in the Energy Act 2013. I would appreciate clarification about whether, in the Minister’s opinion, the Government’s proposed amendment to the 2013 Act actually does that. Is there a clear line that shows that everything that is there is what a nuclear safeguards inspector has the power to do as a result of the deflection to that clause? It is by no means clear that that is the case.
With our amendment, we are trying to do that by means of a much simpler procedure. Instead of deflecting it to another clause, the amendment simply states that the inspectors’ powers relate to any of the relevant statutory provisions, and excises the rest of the paragraph. The relevant statutory provisions include nuclear safeguards, and therefore what was there previously would be fully translated into what a nuclear inspector pursuing nuclear safeguards can do. My view is that that is a simpler, more straightforward and clearer way of ensuring that the powers are fully translated.
The second point I alluded to is the question whether, even if one did that, there would be a complete transfer of powers and authorities from what was previously done under Euratom to what is done under ONR. The current Euratom treaty—the 2005 regulations—which I am sorry to admit I have actually looked at, appears to talk about more extensive powers and responsibilities than those in the 2013 Act. Although they are not set out in the same way, there appear to be various things in the Commission regulation that are not mentioned in the powers of inspectors in the 2013 Act, such as the requirement for inspectors to install and maintain equipment, an offence of interfering with equipment, special reports on unusual circumstances and special reports on inventory change.
I am very keen to hear from the Minister—I am sure he has had a good look at the Euratom regulations, too—whether he thinks that, even if he were minded to accept our amendment, the process of translating what is in the 2013 Act to ONR-supervised inspection really does the job, in respect of giving inspectors the safeguarding powers and responsibilities they had under Euratom and those that they need under ONR supervision. I am sure that the Department has looked at that closely. Is he completely satisfied that that is the case, or might he look at that again to see whether the moment of transmission set out in the Bill really does the business in respect of both making the nuclear safeguarding regime secure and the powers of inspectors for the future?
Richard Harrington
I shall do my best to implement the wise advice you gave us, Mr Gray.
In summary, I believe that the intentions behind amendment 14 are entirely good, but I would argue that it is defective because it would turn on the improvement notice power for nuclear security. That does not need to be turned on because there are existing, stronger direction-making powers. I shall briefly try to make that argument—hopefully with some success—to the Committee. Of course, I share the hon. Gentleman’s concern to ensure that the ONR inspectors have the right powers to fulfil their responsibilities. That is the whole purpose of the Bill.
This issue was raised by the Prospect union. As a result of its evidence, I asked it for a meeting, which I have arranged for the next couple of weeks, to discuss all the issues it raised, together with the other union that gave evidence at the same time.
Paragraph 11(2) of the schedule to the Bill amends paragraph 3(5) of schedule 8 to the Energy Act 2013, extending the power to inspectors who are appointed. That is important so that inspectors can issue improvement notices for non-compliance in relation to nuclear safeguards. Therefore, I would argue that the Bill already achieves the purpose of the amendment.
Paragraph 4 of the schedule amends section 82 of the 2013 Act such that relevant statutory provisions will include nuclear safeguards. That is the key to switching on the ONR power. I hope that that reassures the hon. Gentleman, and colleagues on both sides of the Committee, that the Bill achieves the purpose of the amendment.
I shall leave it at that, Mr Gray, in keeping with the advice you gave. I would like to discuss this matter in greater detail, but that was the sentiment of your instructions to us.
Dr Whitehead
I appreciate the Minister’s wish for brevity on these occasions, but I do not think that this is an issue on which we can be completely brief. By the way, there is plenty of time for the Committee to get the rest of its business through, so I am not concerned that by having a proper debate on this clause we will run out of time—I am certain about that.
I have not heard anything about the second point that I made in my contribution. My hon. Friend the Member for Sheffield Central emphasised that point. Indeed, the evidence from Sue Ferns and Prospect emphasised the question of whether the inspectors will have the powers, through straight translation into oversight by the ONR of what is presently oversight by Euratom, that they actually need.
I mentioned comparing and contrasting what was in Euratom and what is in the Energy Act 2013. The Minister may well be right that although the translation of the requirements in the Energy Act 2013 into nuclear safeguarding may not be as elegant, it does the job. However, that does not at all address the point of what is going to be translated and whether that is fully fit for purpose as far as the new inspection regime is concerned. Will the Minister give an assurance that he has looked at this matter carefully and is completely assured that that is the case? Has he considered, or might he consider, whether combing through the material that was there previously might lead to anything further being added to inspectors’ powers and responsibilities, either by regulation or by further legislation, perhaps on Report? [Interruption.]
Dr Whitehead
I was seeking to tempt the Minister into standing up and saying a few more things.
Richard Harrington
I was not quite sure whether the hon. Gentleman had finished his comments. I stick to my point that this is obviously a complex area and I think that the Bill does exactly what he wants. I will consider his points carefully and, if further drafting is necessary, will bring forward proposals on that subject.
Dr Whitehead
This is going quite well. I thank the Minister for that consideration and it meets our concerns that, although I have not yet been able to spell them out, additional powers may be needed. If the Minister looked at that I would be very grateful. I therefore beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule agreed to.
Clause 2
Power to amend legislation relating to nuclear safeguards
Dr Whitehead
I beg to move amendment 5, in clause 2, page 4, line 8, leave out
“may by regulations amend any of”
and insert
“must by regulations amend relevant provisions of”.
This amendment would require, rather than enable, the Secretary of State to make regulations in consequence of a relevant safeguards agreement.
The Chair
With this it will be convenient to discuss amendment 6, in clause 2, page 4, line 13, at end insert—
“(1A) The Secretary of State may only exercise powers under this section at the point at which amendment of any of the legislation in subsection (1) becomes necessary in order to complete the process of transposition of responsibility for nuclear safeguarding from EURATOM to the Office for Nuclear Regulation, and for no other purpose.
(1B) Upon exercising the power set out in subsection (1) the Secretary of State shall report its operation by means of a report laid before both Houses of Parliament.”
This amendment limits circumstances under which the Secretary of State may exercise certain powers in this section and requires a report to be laid before Parliament.
Dr Whitehead
This proposal is serious and requires substantial discussion in Committee. Amendments 5 and 6 address a particularly egregious part of the Bill: clause 2, which provides the power to amend legislation relating to nuclear safeguards.
As I am sure hon. Members are aware, the clause suggests that we amend not only secondary legislation relating to nuclear safeguards but a series of other pieces of legislation: the Nuclear Safeguards and Electricity (Finance) Act 1978, the Nuclear Safeguards Act 2000 and the Nuclear Safeguards (Notification) Regulations 2004. Two of those are pieces of primary legislation that have gone through the whole parliamentary procedure on the Floor of the House, received Royal Assent and become legislation. The clause suggests that those pieces of legislation should not only be amended by regulation but be amended on the basis of discussions about an agreement with the IAEA that we know nothing about at the moment and have not agreed.
One might think that these are not Henry VIII clauses but Henry IX clauses. I think there was a Henry IX in France, so it is possible to make that point without too much interruption in history. These powers are very substantial and exceptional and, to my mind, run wholly counter to what we should be doing in the House as far as legislation is concerned.
I will come to what the Government have to say about the particular circumstances in a moment. Henry VIII powers were obviously used substantially during the reign of Henry VIII, but subsequently have not been used quite so frequently. Although they have been used a little more frequently in recent years, the idea that the Executive—by Executive action, effectively—can overturn, amend or take in a different direction what Parliament has decided through legislation is something the House has fought against for many years. When such powers have been sought in the past, they have been in some instances successfully challenged, and on many occasions strongly challenged on both sides of the House.
We want to make an initial statement of principle that the Opposition do not like Henry VIII clauses. We think they are an overturning of the sovereignty of Parliament in dealing with these issues and that they give powers to the Executive that are unwarranted on virtually all occasions. A piece of legislation should be written in this form only in a dire emergency, where a calamity will befall the nation if that action is not taken. In all other circumstances, the idea is that legislation should properly appear before Parliament to be debated. If it is legislation replacing or substantially amending primary legislation, that process should be one of primary legislation as well.
In this instance, what might be envisaged as far as primary legislation is concerned would not detain the House forever or be particularly complex or difficult to achieve. Yesterday in the Chamber, we saw how it is possible to take a Bill through in an afternoon. Where changes are made with a consensus in the House, the procedure is pretty rapid, straightforward and achievable. Why can that procedure not be adopted for these pieces of legislation? Is it because there is a national emergency or the sky will fall in if we do not make the amendments? Is it because it has not been possible to find parliamentary time to undertake what would be neat and precise Bills to make the amendments? Indeed, on the basis of what has previously been achieved, would not a brief piece of primary legislation on the Floor of the House have agreement from all parts of the House?
I am not persuaded, nor do I think I will be persuaded easily, that that is not possible in these circumstances. The clause as drafted is therefore not something that has to be done, but something the Government have chosen to do in support of their legislation. It may well be that the Minister will say, “Yes, we have chosen to do this because, as far as we are concerned, these things have to be done.” As far as previous legislation is concerned—let me find a copy of the document that I just gave to the Clerks.
The Department’s delegated powers document on legislation, to which I have referred, states at paragraph 78:
“It is essential that the specified safeguards legislation is amended to make correct reference to the new agreements that the UK envisages concluding with the IAEA”.
Furthermore, paragraph 79 states:
“Without amendment, the existing provisions will become ineffective”.
The Henry VIII clause emergency is simply that any legislation that has not been amended after an IAEA agreement has been decided—we would enter a different arrangement from the one we had with Euratom—would render the new procedure ineffective. The relevant Acts therefore need to be changed. However, that is not the case with secondary legislation; it is only the case with those Acts, which I think we can all agree need to be amended. Of course, when all those proceedings have concluded, legislation will need to be in line with new procedures elsewhere on the statute book. That is not an issue at all. The issue is whether, in order to bring those bits of legislation in line with whatever we have agreed, we effectively declare a national emergency and say that we have to adopt Henry VIII clauses to do it. That is quite wrong, both for this piece of legislation and indeed for most other pieces of legislation that try to include those Henry VIII clauses.
Dr Whitehead
I am disappointed by the Minister’s response to the amendments this morning. He is right to point out that they in some ways represent what might be construed as a little bit of a change, perhaps a mellowing, from our position on Second Reading on the Floor of the House. It is not that we have changed our positions on Henry VIII clauses, but that addressing what is in the Bill is the important thing to do in Committee. We need to decide whether to amend it rather than try to chuck the whole thing out. That is the difference in our discussion this morning. I thought the amendments were constructive.
Although the Minister has mentioned that Government changes to these pieces of legislation would have to be reported to Parliament, that is a very different procedure from the procedure being suggested this morning.
Drew Hendry
The Minister himself has said that principles sometimes have to be adjusted pragmatically. The problem is that the Minister cannot tell us at the moment which principles and for whom they would have to be pragmatically adjusted.
Dr Whitehead
The hon. Gentleman is absolutely right because we are in the dark as far as what is going to come out and the IAEA are concerned. We think that an agreement will be reached and that there will be a new voluntary treaty arrangement. We think that when that new arrangement has been reached, it will be suitable for the purposes for which we have made all these legislative changes. Indeed, the legislative changes will be scrutinised effectively by the IAEA before that treaty can come about. The IAEA wants to be sure that we have put a regime in place that does the job in changing the relationship of this country as far as nuclear safeguarding is concerned from Euratom to ONR.
Richard Harrington
Does the hon. Gentleman agree—and I am also trying to answer the Scottish National party’s spokesman about the principle and the way it might be changed—in practical terms, forgetting principle for the moment, that we cannot be sure exactly when the agreements with the IAEA will be finalised? Certainly, it is in our gift but it is also with the IAEA. We may well be under great time pressure to make sure that the new inspectors—who might even be the same inspectors—have the legal cover to maintain the safeguards we all want. There are times when some things have to be delegated and moved very quickly to deal with an expediency. I felt that was an example.
Dr Whitehead
I appreciate what the Minister says, but that does not knock away the fundamental principle that, except under very exceptional circumstances of national emergency, things that amend primary legislation by secondary legislation should not be before this House. Essentially, the Minister has summed up the case from his point of view that he thinks this is essential. It is just that there could be some time constraints.
Drew Hendry
On time constraints, as the Minister has just said, is it not the fact that when Governments have to act in haste, it is even more important to have the scrutiny of the decision they are taking?
Dr Whitehead
The hon. Gentleman is absolutely right. I accept that in cases of dire emergency, where the enemy is about to invade or some such, action needs to be taken that may not necessarily carry out the full intent of the parliamentary procedure. We are not in that position. As the Minister has said—he put it very well—there could be time constraints, that’s all. The limited time available for us to get this done could be problematic.
Richard Harrington
I do not want to be dramatic, but not having a nuclear safeguards regime because of the lack of an inspector’s legal power to inspect, as far as we are concerned, would be pretty much a national emergency.
Dr Whitehead
Indeed, the Minister is right, in principle. That may be something we might address with one of the amendments we may discuss this afternoon.
The fact of the matter is that putting something in this legislation simply because it might be a little inconvenient to have it any other way, given time constraints, is not a justification for using Henry VIII clauses. As I have mentioned, it is not beyond the wit of Government under those circumstances to introduce primary legislation that can be carried through this House very quickly indeed. If the Minister is so concerned about time constraints, he should also understand that other people will be concerned about time constraints as well and would be willing to make sure that that kind of legislation went through speedily.
This morning, he is giving assurances that this will all be done in the proper way and that it will be okay. We can give assurances on the other side that yes, if he did it in a proper way, we would make sure that this was done properly. Those assurances are of about equal weight. He simply has not made the case that the arrangements are necessary for the purpose of translating all the stuff in question into UK law. I remind the Committee that the Department, setting out the context and purpose of the clauses, has emphasised that it is necessary to take the action in question, but there is no mention in the document of the necessity to do it in time that is not otherwise available to Parliament. The document does not make that argument.
Because we have tried to be so reasonable and careful in our approach, but have not received anything coming the other way—
Richard Harrington
I remind the Committee that the changes under the Henry VIII power are about changing references to specific articles in the existing legislation. They are not changes to substance or principle.
Dr Whitehead
Indeed, which is why it would be easy to take a new Bill through the House, to make that evident with respect to the relevant provisions. Everyone would agree that that Bill should move through the House quickly. I think I could get an absolute assurance of that from the Opposition. For that reason, it is not necessary to cast the measure in its present form.
Richard Harrington
Is the hon. Gentleman saying that he would rather there was a brief period with no safeguards regime because there were no inspectors with the legal cover to inspect, so that the Bill could be brought through the House under an emergency procedure?
Dr Whitehead
No. I should rather that the Government organised their business so that it could be done properly in the time available, and that we could then carry out proper parliamentary procedure, to make sure that the power of Parliament was behind whatever was agreed.
Richard Harrington
But the hon. Gentleman would accept that, as it takes two to tango, a lot depends on timing with the IAEA, which is another organisation.
Dr Whitehead
Yes, indeed. The Minister is straying slightly, I think, into concerns that we may well address this afternoon: it is true that there are time constraints, and there are ways to sort that out.
Paul Blomfield
My hon. Friend is right to underline the importance of the point. I am sure that he, like me, would accept the Minister’s point about urgency in good faith, but is not there a problem in that the provision could apply to a range of issues? It is central to the Government’s argument about Henry VIII powers in general—
The Chair
Order. That is going well beyond the scope of the Bill. Mr Whitehead is, I think, about to wind up.
Dr Whitehead
I could have said, Mr Gray, that he makes an entirely out-of-order but nevertheless strong point.
The bottom line is that we have not received this morning the assurances that we hoped we might, about the circumstances in which we could move ahead with the amendments, rather than simply sitting on our hands and demanding that the Henry VIII clauses be struck out. Therefore I think we are going to have to divide the Committee on both amendments this morning. I hope that we can proceed to do that.
Question put, That the amendment be made.
Nuclear Safeguards Bill (Sixth sitting)
Alan Whitehead ExcerptsTuesday 14th November 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 14 November 2017 - (14 Nov 2017)
Dr Alan Whitehead (Southampton, Test) (Lab)
I beg to move amendment 7, in clause 4, page 5, line 6, at end add—
“(5) Regulations under subsection (2) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”
This amendment would prevent the commencement of clauses 1 and 2 without the regulations made under this section being subject to the affirmative procedure.
This is a simple amendment that repeats the requirement suggested in other amendments for secondary legislation to be subject to the affirmative, rather than negative, procedure. I made the case this morning for the power of the affirmative procedure. As hon. Members can see, the amendment would ensure that regulations under subsection (2) could not be made unless a draft instrument were laid before Parliament and approved by a resolution of each House—that means an affirmative resolution.
I do not think we need go over the difference between an affirmative and a negative resolution and why we think affirmative resolutions are always better. Through the amendment, we simply seek to ensure that regulations made under subsection (2) are subject to the affirmative procedure. I do not think we need to detain the Committee too much further with detailed discussion. We think this is important and consider that it should be included in the Bill, to ensure that matters properly come before the House when these issues are discussed.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
Good afternoon, everybody. I thank the hon. Gentleman for not repeating what he said about affirmative and negative procedure, because those points were well made this morning. I have sympathy, of course, with his broad aims of strengthening parliamentary scrutiny, but I argue that this is not an appropriate process to put in place. Parliament will have already passed the Bill and approved the legislation. I am confident that there are appropriate processes in place to ensure proper parliamentary scrutiny of the substantive powers in the Bill.
Clause 4 contains a commencement power. It is entirely conventional for the commencement power not to be subject to any parliamentary procedure because, as I say, it brings into force law that Parliament has already enacted. Clauses 1 and 2 contain delegated powers that must—I know “must” is one of the hon. Gentleman’s favourite words in the English language—be exercised before the UK’s new nuclear safeguards regime can be brought into effect. The regulations necessary to do so will be subject to the draft affirmative procedure. It would serve no useful purpose, in the Government’s view, to make the power to commence those delegated powers subject to the draft affirmative procedure.
I would like to reassure hon. Members that draft nuclear safeguard regulations are currently being worked on in close collaboration with the Office for Nuclear Regulation, and we will provide drafts during the passage of the legislation. The precise arrangements for the future safeguards regime and the details of the regulations will be subject to further consideration and detailed consultation with the regulator, industry and other interested parties.
Dr Whitehead
I am grateful to the Minister for mentioning that detailed regulations will be available during the Bill’s passage. Would he perhaps be more specific about that and say when those draft regulations might appear? I assume it will not be in Committee, but it should certainly be before Report.
Richard Harrington
As I said, my hope is that that will happen soon. I cannot confirm that it will be before Report, because I do not know when that will be—unless the hon. Gentleman has any information. I certainly hope that it will happen by the end of this year or very early in January, but that is allowing myself a bit of wiggle room. There is no great secret going on; we are just ensuring that all the detail and everything is in place. With that in mind, I hope that the hon. Gentleman will feel able to withdraw the amendment.
Dr Whitehead
I thank the Minister for his explanation of the circumstances under which commencement would take place, and what regulations would proceed under that. Although I am not completely convinced that it provides exactly the safeguards that we require, it does go a long way towards reassuring us on the status of the Bill, so we will not press the amendment to a vote. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chair
Amendment 8 was debated previously, but I do not think that the hon. Gentleman seeks to divide the Committee—I think not, from his lack of response.
Clause 4 ordered to stand part of the Bill.
Clause 5 ordered to stand part of the Bill.
New Clause 1
Purpose
“The purpose of this Act is to provide for a contingent arrangement for nuclear safeguarding arrangements under the terms of the Nuclear Non-Proliferation Treaty in the event that the United Kingdom no longer has membership or associate membership of EURATOM, to ensure that qualifying nuclear material, facilities or equipment are only available for use for civil activities (whether in the United Kingdom or elsewhere).” —(Dr Whitehead.)
This new clause would be a purpose clause, to establish that the provisions of the Bill are contingency arrangements if it proves impossible to establish an association with EURATOM after the UK’s withdrawal from the EU.
Brought up, and read the First time.
Question put, that the clause be read a Second time.
Dr Whitehead
I beg to move, That the clause be read a Second time.
The new clause refers to the possibility of seeking a transition period prior to the UK leaving Euratom of not less than two years. It states that during that transition period,
“conditions under which the UK is a member of EURATOM before exit day shall continue to apply…obligations upon the UK which derive from membership of EURATOM before exit day shall continue to apply…structures for UK participation in EURATOM that are in place before exit day shall be maintained”—
and most importantly—
“financial commitment to EURATOM made by the UK during the course of UK membership of EURATOM before exit day shall be honoured.”
Nothing in the new clause suggests that we shall be members of Euratom in perpetuity.
Sir Robert Syms (Poole) (Con)
As I understand it, the hon. Gentleman is suggesting that we continue to be a member of Euratom for two years, during which time we would presumably continue to pay our contribution, while at the same time employing inspectors in the UK— we are actually trying to recruit people at the moment. Would it not impose additional costs on the industry if we are both recruiting inspectors and staying in Euratom? Is that not double jeopardy?
Dr Whitehead
No, because the idea of a transition period would be, among other things, to give greater scope for precisely that sort of recruitment, training and other arrangements to take place, so that the new regime is assuredly in place by the time we leave Euratom—assuming we do. There would not be any duplication because the positions after Euratom would be fully in place.
The transitional period would be used for the purpose of making sure those final arrangements were in place. Unless a series of magical events occur and everything is completely and easily in place before March 2019, I cannot see anything other than good things coming out of a transition period, including the things we have discussed in making a transition from Euratom to a nationally determined inspection regime complete, waterproof and fully operational.
In that sense, the Bill is straightforward:
“It ensures that, when the United Kingdom is no longer a member of…Euratom…we will have in place a legal framework that meets our future international obligations on nuclear safeguarding. Nuclear safeguards demonstrate to the international community that civil nuclear material is not diverted into military or weapons programmes…Our current nuclear safeguards obligations arise from our voluntary offer agreement…with the International Atomic Energy Agency”—
which I will come on to—
“The IAEA is the UN-associated body responsible for the oversight of the global non-proliferation regime. The first requirement flowing from the UK’s commitments on safeguards is to have a domestic system that allows the state to know what civil nuclear material it has, where it is and whether any has been withdrawn from civil activities.”
As we have discussed,
“the Bill has been prepared on a contingency basis. The discussions around our continued arrangements with Euratom and with the rest of the European Union have not been concluded, but it is right to put in place in good time any commitments that are needed in primary legislation. Euratom has served the United Kingdom and our nuclear industries well, so we want to see maximum continuity in those arrangements.”—[Official Report, 16 October 2017; Vol. 629, c. 617.]
I cannot keep this up any longer; those are the words of the Secretary of State on Second Reading.
It appears that the Secretary of State at least is pretty much onside with the idea of wanting maximum continuity of the arrangements with Euratom, that Euratom has served us well, and that we have no objections in this country in the past to the working of Euratom, what it does and how it works. For “maximum continuity” of those arrangements, as the Secretary of State clearly wants, seeking associate membership or arrangements with Euratom under article 206 of the existing Euratom treaty—the Secretary of State was pressed on that on Second Reading—is something we would positively seek as an alternative to the contingency that the Bill represents.
From what the Secretary of State stated on Second Reading and from his introduction to the Bill, it does not seem to require a great deal of construction to conclude that that is something that the Government have in mind and would like to achieve.
Dr Whitehead
I am not sure that, for the sake of the apparent administrative convenience of leaving the two institutions on the same day, everything will be better served. We have discussed in this Committee precisely why things probably would not be better served regarding the process of ensuring that we have everything in place to replace what we acknowledge that we have received well from Euratom in the past. My hon. Friend the Member for Birmingham, Edgbaston, in a brief but important contribution, raised the question of how likely it is that the various bilateral deals that we will have to make with various states around the world will be concluded in a timely fashion. Indeed, I suggest that the opposite is the case—they are not likely to be concluded in a timely fashion, not least because, for example, agreements with the United States would have to go through both Houses of Congress.
It is unlikely that there will be anything other than a rather messy tail hanging around for quite a long while if we stated that we were leaving Euratom on the same exit day the Prime Minister is suggesting in amendment 381 to the European Union (Withdrawal) Bill. I do not know whether this piece of advice will be welcome, but if that is what the Prime Minister wishes to do, I think it might be a good idea for her to add the words “and Euratom” to that amendment. I say that because although Euratom and the EU are effectively conjoined, Euratom did not come into being at the same time as the European Union, and therefore it is not necessarily the case that if one puts in place an exit day for the EU, one automatically transfers that exit day to exit from Euratom. That may well be what the Government want to do, but it is by no means clear that that is what would actually have to happen.
It is possible to consider, without in any way undermining the idea that we leave Euratom, a different form of leaving day from that from the EU, in my opinion. That has not particularly been tested in terms of the arguments about whether the Euratom treaty was separate from the EU. The Minister may well be getting wise advice that that is not the case, but it seems at least arguable that there is nothing in stone, and nothing in the amendments tabled to the European Union (Withdrawal) Bill, that points in the direction of having to leave Euratom at the same time as leaving the EU.
If it were possible to negotiate an arrangement whereby the aim was associate status of some description and the means were a transitional period, with the clear aim that that associate status would be in place at the end of it, that would seem to be a prudent thing to do, as far as our future relationship with Euratom is concerned, bearing in mind all the things we have said about how it has served us and what we could get from it during that transitional period, with that eventual aim in mind.
It would be not only desirable but very wise, in the present circumstances, to state on the face of the Bill that that is what we will try to do, and to require the Secretary of State to try to ensure that it happens. That does not undermine our future relationship with Euratom or with the EU; it merely puts in place something that is possible to achieve and that could be of considerable benefit to this country and to our partners in the nuclear community around the world.
It would enhance considerably the value of the Bill if that transitional arrangement did not succeed, because it would, among other things, show our partners in Euratom and the wider international community that we were intent and absolutely serious about wanting the best possible regime for the future. That surely would be a considerable boost to the idea that we can survive well in an international and closely conjoined nuclear community while not being a member of Euratom in the long term. If the Minister is not prepared to accept the amendment, I would like it on the record that we tried to divide the Committee this afternoon.
Question put, That the clause be read a Second time.
Dr Whitehead
I beg to move, That the clause be read a Second time. The clause reflects what we have discussed in Committee about the process of securing an agreement that is voluntarily entered into with the IAEA to replace the previous agreement that was essentially mediated by Euratom, and hence has to be replaced.
One might think that the agreement should, in principle, be reasonably easy to arrive at. If we have a contingency nuclear safeguarding regime in place that we can demonstrate to IAEA fits the bill as a replacement for Euratom, the new voluntary agreement with IAEA should proceed reasonably straightforwardly. My understanding is that it is a voluntary agreement made by nuclear-possessing powers, and this is clearly about entering into an agreement as a nuclear-possessing power alongside other individual nuclear-possessing powers outside the ambit of Euratom. This would be something that we and the IAEA would want to conclude.
As we have heard, that agreement is still some way off being concluded. We are effectively in a position of preliminary discussions with the IAEA about what an agreement might look like, and how it should proceed. As we have heard, we are being asked to agree to put legislation on the statute book as if that agreement had been concluded. We are to take on trust the fact that the agreement can be concluded in reasonably good time, so that the Henry VIII clauses we discussed this morning could be put in place. We discussed those clauses without knowing when or whether an agreement with the IAEA would be forthcoming, what stage of negotiation we were at, and whether there were particular obstacles in the road, or whether indeed those obstacles had been substantially resolved. It does not look as if we are going to hear anything about the agreement until its conclusion. However, we are part of a Parliament that is putting legislation in place as if we had heard about it.
Richard Harrington
Thank you, Mr Gray. I note that, in accordance with provisions in the Bill, an international agreement may be defined as a relevant international agreement for the purpose of Bill only if the Secretary of State specifies that agreement in regulations. The Bill provides that such regulations will always be subject to the draft affirmative procedure, providing the opportunity for parliamentary scrutiny of whether an agreement should be a relevant international agreements as defined by the Bill.
As I have established, relevant international agreements are already subject to an open and transparent process. My fear is that imposing an additional reporting requirement would provide little added value and might hinder negotiations, which I know the hon. Gentleman would not want. Indeed, requiring such frequent updates on negotiations could risk weakening our position and might compromise our ability to build rapport and trust with our negotiating partners. I am concerned that that should not happen, but I recognise fully the importance of transparency and the need for Parliament to be able to provide input into the negotiations, so I am sympathetic to the sentiment underpinning the new clause. If the hon. Gentleman is prepared not to press this to a vote—in fact, even if he does—I would like to give the matter some further thought, because I think I can come up with a proposal that strikes the right balance and maximises the transparency that he wants and that I am not afraid of at all. I do not want to impede the progress of these time-sensitive and vital negotiations, which of course involve other parties.
Dr Whitehead
I thank the Minister for giving a constructive response to the new clause without going quite as far as saying that he agrees with it. I hope that he will be able to come up with something that, while not necessarily this proposal, maximises the transparency of the process. We are not only talking about the outcome and a report of the outcome that will come to Parliament. Because of the unique circumstances in which we are legislating while the treaty is being discussed and legislating for something that is quite central to that treaty coming about, it is important we have transparency on the journey as well as the conclusion. If the Minister can work out a device that allows that to happen, which I think he indicated he wishes to think about seriously, we would be happy not to press this. I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 5
International agreements: devolved authorities
“(1) The Secretary of State must consult the persons or bodies listed in subsection (2) before concluding—
(a) a relevant international agreement, or
(b) any agreement with EU Member States relating to nuclear safeguarding.
(2) The persons or bodies are—
(a) Scottish Ministers,
(b) Welsh Ministers, and
(c) a Northern Ireland devolved authority.”—(Drew Hendry.)
Brought up, and read the First time.
Drew Hendry
I beg to move, That the clause be read a Second time.
New clause 5 states that the Secretary of State must consult certain persons or bodies—the Scottish Ministers, Welsh Ministers or a Northern Ireland devolved authority —before agreement with EU member states relating to nuclear safeguarding.
As mentioned earlier, without confirmation of a transitionary deal, the Government leave a host of unanswered questions about nuclear safeguards. Falling back on World Trade Organisation rules risks the UK breaking international law. As a nuclear weapons state, the UK currently meets some of its safeguards obligations under international nuclear law through a voluntary offer agreement with the International Atomic Energy Agency, to which the Euratom community is also a signatory.
A report by the Nuclear Industry Association UK found:
“Falling back on World Trade Organisation (WTO) arrangements in the absence of a replacement safeguards agreement with the IAEA and/or an implementation period with Euratom risks putting the UK in breach of its obligations under international nuclear law and would have a significant impact on the UK nuclear sector.”
Those unanswered questions are big issues. Will the UK Government ensure that the UK’s nuclear facilities are subject to Euratom’s safeguards regime? If they are not to be monitored by Euratom’s inspectors, will the UK negotiate a replacement for the voluntary offer agreement with the IAEA to remain in compliance with international law? How will the UK Government design, resource and implement new UK safeguarding arrangements in line with accepted international standards?
We have already heard that the Minister cannot guarantee that fully trained, certified professionals will be available. What good are safeguards if there is nobody qualified to implement them? While safeguards and safety are reserved, areas of regulation such as waste and emissions from nuclear sites are devolved.
In the light of the Minister’s earlier comments on issues of national security that could arise, the Scottish Government must be involved in the negotiations regarding nuclear safeguards, and the UK Government must involve the Scottish Government at every stage of the negotiation process to ensure that the deal reached works for the people of Scotland. That is equally important for the other devolved Administrations in Wales and Northern Ireland.
Conservative Governments have a poor track record on Scotland and nuclear programmes. They must ensure that Scotland is not turned into a dumping ground for nuclear waste. I say to the Minister that as matters proceed in the House, there is an opportunity for his Scottish colleagues in the Tory party to help us stand up for Scotland’s interests. We look forward to seeing what they do. I hope the Minister accepts that it is only sensible and proper that the Scottish Government and the other devolved authorities are involved in this process in a meaningful way and involved in the negotiations, particularly given that the stakes are so high.
Richard Harrington
On a point of order, Mr Gray—it is the first point of order I have ever raised. I want to thank you as Chair, and Mr McCabe, who is not here today. I would like to thank the Clerks. I would like to thank hon. Members on both sides of the Committee for their patience, time and valuable contributions. I look forward to seeing the Bill progress in terms of the discussions we shall have before Report and then on Report and beyond. I hope the Bill’s progress continues to be characterised by the spirit of co-operation and conciliation that we have enjoyed. I particularly thank the shadow Minister for that, but also everybody else who contributed.
Dr Whitehead
On a point of order, Mr Gray. I join the Minister in thanking you for your exemplary chairing of our sessions. [Hon. Members: “Hear, hear.”] I thank Mr McCabe, too, for his assistance with chairing.
I would also like to thank all Committee members for the constructive and helpful way that we managed to proceed. We had our disagreements. We put those squarely in the open and discussed them, and as a result of those discussions we had a number of exchanges that look to be constructive for the future. I am grateful for the spirit in which Committee stage has been conducted, and I look forward to Report and to the stages that follow with some optimism for the Bill. I am pleased to have taken part in such a constructive endeavour on all our parts.
Drew Hendry
On a point of order, Mr Gray. May I, very simply, associate myself with the remarks made by the Minister and the shadow Minister?
Oral Answers to Questions
Alan Whitehead Excerpts(7 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Claire Perry
In the world I live in, £100 million is quite a substantial financial investment in CCUS. It is striking that the Scottish Government invested only £100,000 in Project Acorn, as opposed to our £1.3 million. The point remains that the technology is not cost-effective. Only six plants in the world are operating without additional revenue from enhanced oil recovery. We want Britain to be the technological leader and to develop cost-effective solutions. I hope that we can work together to achieve that aim.
Dr Alan Whitehead (Southampton, Test) (Lab)
I welcome the return to some consideration of CCS in the clean growth plan, after the Government’s dreadful mistake in cancelling the £1 billion UK CCS pilot plants in 2015. What discussions has the Minister had with her Norwegian counterparts on the prospects for UK-Norway collaboration on that country’s advanced plans for carbon sequestration in the North sea?
Claire Perry
As the hon. Gentleman will know, Norway is currently a little bit unsure about the level of its own financial commitment. However, it has an excellent Energy Minister, with whom I have had multiple meetings and conversations. It seems strange to me that, having taken the hydrocarbons out of the North sea basin, we should not co-operate to put the carbon dioxide back, so there are frequent conversations. The hon. Gentleman will have seen the clean growth strategy, on which we would like very much to work with other countries—not just Norway, but the United States and Canada as well.
Nuclear Safeguards Bill (Third sitting)
Alan Whitehead ExcerptsThursday 2nd November 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 2 November 2017 - (2 Nov 2017)
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
I beg to move a manuscript amendment,
That the Order of the Committee of 31 October be varied, by leaving out line 6.
It is a great pleasure to serve under your chairmanship, Mr McCabe—Mr Gray is a hard act to follow, but I am sure that you will do it well. Perhaps I could take the liberty of explaining the amendment. If accepted, it will mean that the Committee will not sit on 7 November. Everything else will remain the same.
Dr Alan Whitehead (Southampton, Test) (Lab)
It is a pleasure to serve under your chairmanship, Mr McCabe. My function at this point is merely to concur with the Minister’s suggestion that we leave out line 6.
Manuscript amendment agreed to.
The Chair
We now begin line-by-line consideration of the Bill. The selection list for today’s sittings is available in the room and shows how the selected amendments have been grouped. Amendments grouped together are generally on the same issue. Please note that decisions on amendments take place not in the order in which they are debated but the order in which they appear on the amendment paper. The selection list shows the order of debate. Decisions on each amendment are taken when we come to the clause that the amendment affects. I will do my best to use my discretion to decide whether to allow a separate stand part debate on individual clauses and schedules following debates on the relevant amendments.
Clause 1
Nuclear safeguards
Dr Whitehead
I beg to move amendment 2, in clause 1, page 1, line 22, at end insert
“which has been approved by a resolution of each House of Parliament”.
This amendment would prevent the Government from using powers under Clause 1 to implement an international agreement without the agreement having first been approved by both Houses of Parliament.
It might be a good idea, before proceeding to detailed examination, to say a few words—for the benefit and satisfaction of all hon. Members, I hope—about what we are trying to do with the amendments we have tabled. Members who have had a chance to peruse the amendment paper in some detail will see that all the amendments tabled by Labour Members are entirely consistent with the speedy and successful translation of our present arrangements with Euratom into UK law. I want to emphasise at the outset that the Opposition concur completely that we need a new set of nuclear safeguard regulations and arrangements, contingent upon other actions that may take place as far as the present arrangements with Euratom are concerned. We certainly do not wish in any way to impede the process of achieving that new set of arrangements.
What we do want to do, however, is to put on the face of the Bill a number of safeguards, understandings and clarifications about how that process will come about. That will therefore be the content of this debate. The Committee might find it helpful and of some comfort to learn that that is how we intend to proceed. Should Divisions occur, they will be about particular issues that we want the Bill to address; they will not be an attack on the Bill’s fundamental purpose. We want to clarify that point by including a purpose clause setting out what the Bill is intended to do when it becomes law.
The amendment relates to agreements not with Euratom but, we hope, with the International Atomic Energy Agency. The UK had safeguarding agreements with the IAEA before it joined Euratom, and they were effectively taken over by the UK’s accession to Euratom by virtue of the European Communities Act 1972, under which that translation was undertaken without the need for further domestic implementing legislation. The safeguarding agreements with the IAEA therefore have to be untangled from Euratom and made anew in the event that we complete the process of leaving the EU. It will be necessary to negotiate effective new safeguarding treaties with the IAEA, and that will depend to a considerable extent on what the UK does to put in place effective measures, contingently or otherwise.
What we do in this Committee today will be a material issue for the eventual treaties with the IAEA. I am sure that the IAEA will want to see that the UK has an effective safeguarding regime in place as a successor to what is presently done under the auspices of Euratom, and that it is as good as or better than what is presently operating in the UK on the IAEA’s behalf through Euratom. A starting point for the completion of those negotiations will be that we have something in place that works, is sufficient for the IAEA’s purposes and can be the basis for an assurance that those arrangements will be in place for any treaty we make with the IAEA to get us back to the pre-1972 position.
The explanatory notes state:
“The consequential amendments necessary to these pieces of legislation will depend on new safeguards agreements between the United Kingdom and the IAEA that are currently being negotiated; as such the United Kingdom will need to maintain flexibility to ensure these future agreements can be implemented in domestic legislation. A power to allow this legislation to be amended in this way is taken in clause 2 of the Bill.”
Not only will the Bill allow that arrangement to take place, but the IAEA will shine a light on the outcome of our proceedings, at the point at which those treaties—those new arrangements—will be concluded and put in place.
I am not clear exactly what sequence of events will be necessary to secure the circumstances under which a new treaty arrangement with the IAEA will come into effect, so perhaps the Minister could help us with that. Negotiations on a new treaty arrangement with the IAEA cannot reach a conclusion, or indeed start, before a satisfactory regime is in place. Does that mean, as I take it to in this instance, the establishment of the possibility of such a regime through the passing of this Bill into law, or the actual establishment of such a regime, which would require the completion of secondary legislation, proper funding, the establishment of facilities through the Office for Nuclear Regulation and all the other things that go with the full roll-out of a new treaty arrangement? If it is the latter case, we might be much further down the line before an agreement with the IAEA can come to pass, and it is conceivable that there might be a cliff edge at that point.
If the full secondary legislation and all the other elements of the new safeguarding arrangement set out in the Bill have not been completed, the IAEA might say to the United Kingdom, “Well, you haven’t got a regime in place yet, so we can’t complete the new treaty agreement that we have to undertake.” It is conceivable that at that point there would be a hiatus, because we would have exited the protection agreement for safeguarding through Euratom but we would not have a new agreement in place with the IAEA, even though we would be substantially further down the road of translating the purview of Euratom into domestic legislation.
I would be grateful to know the Minister’s understanding of the IAEA’s position. I am aware that at least informal discussions are already taking place with the IAEA, and presumably they will shape the eventual outcome of the treaty arrangement. In any event, the Bill will have to be passed before any agreement with the IAEA is reached—that is the minimal provision. Whether anything else has to be done is a matter for further consideration, but the Bill at least has to be passed.
I think that it is germane to speculate a little on what the treaty might look like. Will it be sufficient to replace the function previously held by Euratom? If it is sufficient effectively to make our previous treaty anew, what additional obligations might its establishment place upon the UK? Of course, we do not yet know the answers to any of these questions, because we are not in a position to conclude the negotiations. Indeed, we are in the foothills of what I imagine will be a substantial mountain of discussion and negotiation with the IAEA before reaching a conclusion.
Dr Whitehead
I thank the Minister for his comprehensive, though not entirely conclusive, explanation of where we are, so far as international agreements and parliamentary scrutiny are concerned. I would appreciate it if he could give a brief thought to the question of the point at which the IAEA will conclude that we have transposed the Euratom responsibilities to the ONR. Will that be when we have passed the enabling legislation, or when the process is completed and can therefore be presented in a box, as it were, to the IAEA saying all is done? That itself is likely to slow up the negotiation process with the IAEA, which I appreciate the Minister said he considers will be complete by exit day.
Paul Blomfield (Sheffield Central) (Lab)
It is a pleasure to serve with you in the Chair, Mr McCabe. I hope to respond to the Minister with the same collaborative approach he has tried to set for the Committee, and I hope all our discussions will be along those lines.
It is worth saying at the outset that I do not doubt for one moment—I do not think any Opposition Members do—the Minister’s good intent in seeking to reassure us on this issue. However, it is also important to recognise in not only this discussion but the wider discussions we will have in our remaining sittings just what is at stake. On a number of issues relating to our negotiations on exiting the European Union, Departments have shown good intention, but because there has been insufficient follow-through, that intention has not necessarily produced the outcomes to reassure other sectors.
It might be in some other areas possible to blur things a little bit at the edges, but we need to remind ourselves of the evidence we had from Professor Matthews on Tuesday. Nothing can be left to chance here. Professor Matthews outlined that if we do not get the safeguarding regime right, the consequences are that,
“Springfields, which produces nuclear fuel, will stop working. The Urenco plant at Capenhurst…will stop working because it will not be able to move uranium around.”
He went on to say:
“It would be difficult for Sellafield and other decommissioning sites, such as the old research sites at Dounreay, Harwell or Winfrith; some of the work there would grind to a halt as well.”––[Official Report, Nuclear Safeguards Public Bill Committee, 31 October 2017; c. 43, Q88.]
There is a lot at stake in ensuring we get this not just more or less right, but precisely right. That is one of the key factors behind our amendment. We must not simply be reassured in the Committee; Parliament needs to be reassured and to have the opportunity to express its view on this before we face the sort of consequences that Professor Matthews talked about.
The Minister has reassured us—again, I do not doubt his intention—on the full parliamentary scrutiny through the affirmative process. My reading of the clauses suggests that there is a bit more ambiguity. New paragraph (1B), which he referred to, says that the Secretary of State will not necessarily provide regulations but “may by regulations”, which gives quite a significant grey area. If the Minister is as sure as he indicated that there will be full parliamentary scrutiny by the affirmative process, the simplest thing to do would be to accept our amendment, which seeks nothing less.
Dr Whitehead
I am grateful to the Minister for setting out in some detail the path by which he considers Parliament would have some scrutiny of the arrangements with the IAEA when they come about. However, I am concerned, as is my hon. Friend the Member for Sheffield Central (Paul Blomfield), about whether what the Minister points to in the Bill actually does the job he thinks it does.
In new subsection (1)(1A) and (1B), inserted by clause 1(3), there is a curious circularity. I will not go through the whole thing, but new paragraph (1B) states:
“The Secretary of State may by regulations specify agreements for the purposes of subsection (1A)(b).”
If we then look at paragraph (1A)(b), it says:
“is specified in regulations under subsection (1B)”.
We then go back to paragraph (1B), and the regulations specified there are the regulations that the Secretary of State may make—that is it. We do not get very far in what I consider real parliamentary scrutiny by that semi-circular argument.
It appears that a relevant international agreement is as specified under new paragraph (1B), and a relevant agreement can be specified by regulations that the Secretary of State may make. If the Secretary of State does not pass regulations specifying those agreements, that is not the case, and the relevant international agreement then does not apply for the purposes of the legislation.
I suggest it would be far simpler to accept our amendment in view of the unique circumstances we are in at the moment. We are having to make treaties anew, and we need to be satisfied that they fully replace what we previously had for a number of years through Euratom. I appreciate that that is a voluntary agreement that has been entered into, and I appreciate that that agreement will undoubtedly be pursued in the light of co-operation, because of the voluntary nature of the agreements being entered into by the IAEA.
The central fact of the matter is that that is being undertaken not only while the Committee considers what it is going to do, but is actually tucked into the legislation as something that will remain outside what the Committee considers, because we have to take decisions about what we want to make our safeguarding regime look like when we do not know what those agreements will consist of. Having this particular system in place, which I accept is not the case for all international treaties, as far as the Bill is concerned, appears to close the circle, as far as the relationship between what the Committee is doing and what the treaty will look like when it comes out is concerned.
As I said, unless someone explains to me that I have completely misread new paragraphs (1A) and (1B), and that there is something else there that does not actually do what I think it says it does, I cannot take full reassurance from those clauses in the way the Minister suggests.
Richard Harrington
I have a suggestion for how we can progress, but I will just say that new paragraph (1B) provides the power to specify agreements for the purpose of the definition but the regulations are always subject to the affirmative procedure, so I argue that the hon. Gentleman’s object has already been achieved.
My suggestion, if it is acceptable—I do not know whether the hon. Gentleman intends to press his amendment to a vote—is that I am happy to sit down with him and discuss this in detail before Report. He has made quite technical, legal points, so I offer to meet him, if that is acceptable. Obviously, it is up to him to decide whether he wishes to press his amendment to a vote. I would have to oppose the vote, simply because I believe we want the same object, but my view is that the Government have clearly covered his rightful concerns about parliamentary scrutiny in our drafting of this.
Dr Whitehead
I am grateful to the Minister for that clarification and for that kind offer, which is quite important for the way that we proceed. I think that the Minister, while he indicates that everything will be done under the affirmative procedure, has still not overcome the circularity in this particular part of the legislation, where the word “may” could derail the whole process of getting us to a position where those international agreements can be determined to be relevant.
Richard Harrington
Any piece of any statute is capable of being changed by Parliament in a new Bill anyway, but on the “may” and “must” argument, the hon. Gentleman will find that “may” is generally the terminology used in these things. There “may” be—oh dear; there might be reasons where a Secretary of State might quite rationally decide not to do something. A purely speculative and hypothetical example would be if something changed and this piece of legislation was genuinely not needed. I do not quite know what could happen, but hon. Members might speculate. The shadow Minister is nodding and smiling; I think he knows what I mean. There may, or must, be other reasons why. It would be strange to impose on a Secretary of State, saying that he or she “must” do something, if it was not necessary. If the Secretary of State did not do it, there could easily be an Act of Parliament or something else to reverse it. It is very normal procedure to say “may” in most Bills. The wording is not meant as a possible way of trapping a mad Secretary of State—I hope no one in this Room or anywhere else would suggest such a thing of the current one—who lost their head and said, “Oh, I’ve got the power; it doesn’t say I must, so I won’t do it, because it says I may.”
Dr Whitehead
I thank the Minister for that further clarification and of course accept that the usual procedure in such circumstances is for the word “may” to be placed before the power of the Secretary of State to cast secondary legislation, whether affirmative or negative. Of course, the Bill is not being dealt with in normal circumstances because, as we shall argue on a later amendment, the normal circumstances for secondary legislation are that there is a change—positive, one would hope—to the previous situation, but that it is built on something pre-existing that will continue to take place even if the regulations are not laid.
As I am sure the Minister is aware, this place is littered with cases where a power to enact secondary legislation has simply not been used. He suggested that there might be circumstances in which it would be perfectly rational not to do so. There are instances in the history of the House where Governments have decided to put new measures before the House, eclipsing previous legislation. That previous legislation, including its secondary provisions, stays on the statute book, but the secondary legislation is not enacted, as it has been superseded.
At either end, that means that “may” is protected either because a new measure has come along, making it redundant to enact secondary legislation; or because, if the Minister decides not to enact the secondary legislation, the status quo ante prevails. However, that is not so in this case, because there will be no status quo ante should we exit Euratom without an associate arrangement. There would be nothing, and the circumstances attached to “may” take on a different colour, under that new and unique circumstance. That is why I am concerned that if we legislate using the wording that we often use in different circumstances, we may fall short of our duty, given that there is no status quo ante, to get things right in relation to subsequent proceedings.
Richard Harrington
I am trying, as always, to think carefully about what the hon. Gentleman is saying; but let us say there was a Secretary of State who was misguided or mad enough to say, “Actually, I am not going to do this because I do not want a nuclear safeguards regime. I want this country to be like North Korea”—or wherever. I think North Korea is the only country without a nuclear safeguards regime. If the Secretary of State desired to take that approach, there would be a lot more tools available for not having a nuclear safeguards regime than the interpretation of “may” or “must”. I am not making light of the point—it is dead serious.
No one has suggested any possibility that we should not have a nuclear safeguards regime, and wrong interpretation of the “may” or “must” point would mean that someone—a Secretary of State or a Government—had decided to do that. If a Government had decided to do that—I know it would not be the Opposition or anyone in any normal form of politics—such a change of policy would not just rely on an interpretation of “may” or “must”.
Dr Whitehead
I understand that point well. Of course we have to squeeze our brains enormously to think about the circumstances under which that set of events would come to pass, but that is not what we are talking about in this clause of the Bill. We are talking about relevant—or otherwise—international agreements. As far as I understand it, in this clause the Secretary of State effectively has the power to declare something a relevant international agreement or not, and to set down what is and what is not relevant in secondary legislation. That does not affect the agreement, but it affects whether that international agreement is deemed to be relevant, and hence whether it comes under the purview of the arrangements that the Minister said were in place to ensure parliamentary scrutiny on those agreements. It is not about whether we design a nuclear safeguards regime, but whether an agreement reached subsequent to our setting out our safeguarding procedure is deemed to be relevant for the purposes of parliamentary discussion when that treaty has come about. That is what I understand this clause to be about. I am grateful to the Minister for his kind offer to lay this clause on the table, although there is not procedure to do that exactly, and discuss what may or may not happen on Report.
Dr Whitehead
It must happen—well, we must consider the Bill on Report, but things may or may not take place on Report that we would be entirely happy with. I take that offer as suggesting that if there is confusion in Committee about what the wording means, our minds can be put at rest at that point, and if not it may be necessary to produce some kind of wording, perhaps on Report, that gets us to the position we both want to be in, so that we are in the same place on this legislation. That is my understanding of what the Minister has said. If that is the case, I am happy to take up that offer—provided a cup of coffee is involved as well—and we will not press for a Division on this clause.
Richard Harrington
The hon. Gentleman is being a little modest about his beverage requirements, as I happen to know that he does not have caffeine in his coffee.
Richard Harrington
Otherwise, I would put extra caffeine in the coffee. The serious point is that I do not accept the fundamental point of the amendments and I do not want the hon. Gentleman to think that I do. He has brought up some serious points, some of which are legal and technical. I would like to take the opportunity to sit down in a non-confrontational way with him and any colleagues who wish to come to drill down on those points. I do not want him to think that I suddenly agree that we do not have enough scrutiny in the Bill, but he made some good and technical points about the interpretation of clauses. I hope we can do exactly as he said: sit down and reach a wording that is acceptable to us all, given that we have the same objective. If not, we can always consider it on Report. That would be the correct way to progress, if that is satisfactory.
Dr Whitehead
In that case, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Dr Whitehead
I beg to move amendment 1, in clause 1, page 2, line 14, at end insert—
“(3A) No regulations may be made under this section unless the Secretary of State has laid before both Houses of Parliament a statement certifying that, in his or her opinion, it is no longer possible to retain membership of EURATOM or establish an association with EURATOM that permits the operation of nuclear safeguarding activity through its administrative arrangements.”
This amendment would require the Secretary of State to certify, before making any regulations to provide for nuclear safeguarding regulations, that it was not possible to remain a member of EURATOM or have an association with it.
The Chair
With this it will be convenient to discuss the following:
Amendment 3, in clause 1, page 3, line 3, at end insert—
“(11) Regulations may not be made under this section unless the Secretary of State has laid before both Houses of Parliament a report detailing his strategy for seeking associate membership of EURATOM or setting out his reasons for choosing to make nuclear safeguards regulations under this Act rather than seeking associate membership of EURATOM.”
This amendment would prevent the Secretary of State from using the powers under Clause 1 to set out a nuclear safeguards regime through regulations until a report has been laid before each House setting out a strategy for seeking associate membership of EURATOM or explaining why we cannot seek associate membership of EURATOM.
Amendment 8, in clause 4, page 5, line 6, at end add—
“(5) No regulations may be made under this section until—
(a) the Government has laid before Parliament a strategy for maintaining those protections, safeguards, programmes for participation in nuclear research and development, and trading or other arrangements which will lapse as a result of the UK’s withdrawal from membership of and participation in EURATOM, and
(b) the strategy has been considered by both Houses of Parliament.”
This amendment would require the Secretary of State to lay a report before Parliament on the protection and trading arrangements that arise from membership of EURATOM, and his strategy for maintaining them prior to making regulations concerning nuclear safeguarding.
New clause 1—Purpose—
“The purpose of this Act is to provide for a contingent arrangement for nuclear safeguarding arrangements under the terms of the Nuclear Non-Proliferation Treaty in the event that the United Kingdom no longer has membership or associate membership of EURATOM, to ensure that qualifying nuclear material, facilities or equipment are only available for use for civil activities (whether in the United Kingdom or elsewhere).”
This new clause would be a purpose clause, to establish that the provisions of the Bill are contingency arrangements if it proves impossible to establish an association with EURATOM after the UK’s withdrawal from the EU.
Dr Whitehead
The new clause and amendments that we are debating in this group go to the heart of the Bill, and I shall explain why. I thank you, Mr McCabe, for ensuring that new clause 1 was in this group, rather than at the end of proceedings, as it would be normally, because that allows us to discuss in some detail, around both the amendments and the clause, what goes in at the beginning of the Bill and what the Bill is about.
Our new clause 1, the essential part of this group, seeks to place a purpose clause at the beginning of the Bill. Hon. Members who have studied the history of purpose clauses in some depth may say, “That’s not usual; most Bills don’t have purpose clauses,” and it is true that most do not, but it is not the case that they never do; and I suggest, given what we have discussed on Second Reading and in Committee today, that to establish a purpose clause for this Bill would seem very sound and wise. For the record, a number of Acts of Parliament do have purpose clauses. For example, both the Criminal Justice and Court Services Act 2000 and the Education Act 2002 have substantial purpose clauses, setting out what the Act is about.
In this instance, the key issue about this Bill is that it is a contingent Bill. It is not like a number of other pieces of legislation, which simply require that we undertake certain actions to achieve a certain end. This Bill will not come into operation, should other circumstances take place. Indeed, on Second Reading the Secretary of State made it clear how the Bill had been prepared. He said:
“I can confirm that the Bill has been prepared on a contingency basis. The discussions around our continued arrangements with Euratom and with the rest of the European Union have not been concluded, but it is right to put in place in good time any commitments that are needed in primary legislation. Euratom has served the United Kingdom and our nuclear industries well, so we want to see maximum continuity of those arrangements.”—[Official Report, 16 October 2017; Vol. 629, c. 617.]
I think the Secretary of State, in addition to making it clear that the Bill could be described as a contingent piece of legislation, was alluding to the fact that there are a number of sets of circumstances, which we do not yet know about but might in the fullness of time, that would effectively cause the Bill not to be operational although it remained on the statute book. Harking briefly back to our previous discussions, the Bill might conceivably be in the position that I described of other pieces of legislation that are full of provisions for secondary legislation—Acts that, because something else has happened that causes that Act and those provisions to become effectively redundant, stay on the statute book but are not further enacted. A purpose clause to make that clear at the beginning of this piece of legislation seems quite important, given the fairly unique status that this piece of legislation holds.
The Chair
Actually, you will not be able to carry on after lunch, because you cannot resume your speech after you have taken your seat.
Dr Whitehead
Perhaps someone else will enlighten the Committee about our other amendments after lunch, then. I know hon. Members will be devastated, but I shall take your ruling firmly to heart and sit down.
Ordered, That the debate be now adjourned.—(Rebecca Harris.)
Nuclear Safeguards Bill (Fourth sitting)
Alan Whitehead ExcerptsThursday 2nd November 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 2 November 2017 - (2 Nov 2017)
The Chair
I remind the Committee that with this we are discussing the following:
Amendment 3, in clause 1, page 3, line 3, at end insert—
“(11) Regulations may not be made under this section unless the Secretary of State has laid before both Houses of Parliament a report detailing his strategy for seeking associate membership of EURATOM or setting out his reasons for choosing to make nuclear safeguards regulations under this Act rather than seeking associate membership of EURATOM.”
This amendment would prevent the Secretary of State from using the powers under Clause 1 to set out a nuclear safeguards regime through regulations until a report has been laid before each House setting out a strategy for seeking associate membership of EURATOM or explaining why we cannot seek associate membership of EURATOM.
Amendment 8, in clause 4, page 5, line 6, at end add—
“(5) No regulations may be made under this section until—
(a) the Government has laid before Parliament a strategy for maintaining those protections, safeguards, programmes for participation in nuclear research and development, and trading or other arrangements which will lapse as a result of the UK’s withdrawal from membership of and participation in EURATOM, and
(b) the strategy has been considered by both Houses of Parliament.”
This amendment would require the Secretary of State to lay a report before Parliament on the protection and trading arrangements that arise from membership of EURATOM, and his strategy for maintaining them prior to making regulations concerning nuclear safeguarding.
New clause 1— Purpose—
The purpose of this Act is to provide for a contingent arrangement for nuclear safeguarding arrangements under the terms of the Nuclear Non-Proliferation Treaty in the event that the United Kingdom no longer has membership or associate membership of EURATOM, to ensure that qualifying nuclear material, facilities or equipment are only available for use for civil activities (whether in the United Kingdom or elsewhere).
This new clause would be a purpose clause, to establish that the provisions of the Bill are contingency arrangements if it proves impossible to establish an association with EURATOM after the UK’s withdrawal from the EU.
Dr Alan Whitehead (Southampton, Test) (Lab)
Thank you very much, Mr McCabe. I am obliged to you for your kind thoughts in that respect. I guess it is a good thing, as it transpires, that I did not tear up my notes at lunchtime after all.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)
You do not need notes.
Dr Whitehead
We will see.
I want to draw briefish attention to the three amendments that are in this group, in addition to new clause 1, which I have already spoken about and which would be a purpose clause at the front of the Bill. The three amendments effectively follow on from that purpose clause. Amendment 1 would require the Secretary of State, before regulations are made under clause 1—what is done under secondary legislation after we pass the Bill through the House—to produce a statement certifying that, in his opinion, it is no longer possible either to retain membership of Euratom or to establish an association with Euratom that permits the operation of nuclear safeguarding activity in the way that I described in my remarks on the purpose clause.
The amendment is important because we are in such uncharted waters as far as the demise of our arrangements with Euratom and what we will put in to replace them are concerned. Assuming the Bill comes to pass as a contingency, it is important that we know between us what has been done in respect of possible continued Euratom membership, and what has been done in respect of possible association with Euratom. Even after those things have been done, it will perhaps turn out that no progress has been possible on those particular areas. The Secretary of State should report to the House that that is the case—that the time for negotiations and discussions is over, that there is no prospect of going down that route and that therefore this Bill, as a contingency, comes into operation.
Were it to be passed today, the amendment would mark an important juncture in the Bill coming into play. Essentially, it would draw the line and, publicly by reference to Parliament through a report from the Secretary of State, show that matters have been explored and avenues gone down but those avenues have now closed to us. That may be just because the time for making those arrangements has run out, or it may be because it is difficult to secure associated status with Euratom similar to that of Ukraine or to that envisaged by the Spaak report in 1956.
If the amendment is passed, such a certification would be put before the House so it can see that efforts have been made, what the situation is and what we can expect, as far as the legislation is concerned. That should be in the Bill because, as everyone agrees, this is contingent legislation. It is contingent on certain actions. The legislation will either be placed aside or work fully as an alternative to the Euratom safeguarding regime.
Amendment 3 follows on from that. It requires the Secretary of State, before that process, to place before Parliament his or her strategy for seeking associate membership or another form of association with Euratom. That is important. There is a number of possible routes by which an association with Euratom could be achieved. Clearly, as we said this morning, the ideal route is to seek full membership of Euratom after the UK leaves the EU. As the Minister said previously, and I am sure will say today, there is a considerable difference of opinion about whether a full membership arrangement is possible or whether our notification to leave the EU has already closed that door. A strategy for seeking associate membership—or, indeed, full membership—would securely lay that argument to rest one way or the other. If the advice the Government receive suggests that certain doors are closed, I anticipate that the strategy would reflect that and the kind of associate status the country might expect to undertake. The Government would report on what strategy would be used to achieve that and whether that kind of status would be sufficient to cover the question of nuclear safeguards. In Switzerland, that appears not to be the case, but in Ukraine it appears possible.
I am sure that the Minister agrees that any such associated status would have to be stitched carefully to reflect the particular circumstances of the relationship between the UK and Euratom. It would probably not be taken off a shelf. That is an additional reason for some kind of report—outlining the strategy, the possible arrangements, and the kind of outcome envisaged were the strategy to succeed—being laid before Parliament. That is what we seek to achieve with the amendment. It is not in any way intended to delay or alter how the Bill works; it is simply to achieve greater clarity about what we are doing, given the contingent nature of the Bill.
Amendment 8 concerns the fact that today we are only discussing one of Euratom’s many functions in relation to UK nuclear activity. Euratom has a range of functions, concerning nuclear research and development, transport of nuclear and fissile materials, arrangements for making sure that nuclear materials are in the right place and in the right hands, and arrangements regarding who owns what when Euratom is or is not involved. Those are all essential functions of Euratom—functions in which the UK has participated wholeheartedly over many years. They will all have to be brought into national arrangements, but are not subject to the provisions of the Bill.
We are saying that we are in circumstances where we think that we have to leave Euratom as a whole and not just part of it, as part of the process of leaving the EU, so it is right that the Government should have available to it and indeed should publish a strategy regarding how Euratom’s other functions will be properly incorporated into the UK’s activities after we have left. The amendment is essentially about laying a strategy before Parliament for maintaining the wider range of protections and facilitations that are within our present Euratom arrangements.
As the Minister himself has made clear, the Bill is about nuclear safeguarding—not nuclear safety, the transport of nuclear materials or any of those other things. Nevertheless, those things are an essential element of Euratom activity. We think it is important to take that into account—not to delay the Bill, but to ensure that a strategy for maintaining those elements is laid before Parliament and is considered by both Houses of Parliament before the regulations are made under this clause.
I commend those amendments. I think they are sensible additions to the Bill, not only in terms of Parliament considering these issues, but in terms of considering all the circumstances under which we will potentially leave Euratom and what kind of regime will be in place once we have left it and replicated, as well as we can, what happens now, for the future of the country. I hope that the Minister will, by acclamation, be able to accept the amendments or, at the very least, accept their bona fide purpose, which is to strengthen the Bill as it goes through the House.
Richard Harrington
I could not have put it better myself. I am sure my right hon. Friend the Secretary of State for Exiting the European Union will be delighted to have been quoted. But it is a serious point and I would confirm seriously that it is our intention to achieve exactly the same terms and conditions in this sector as we have enjoyed with the benefits of Euratom. I will make that clear tomorrow to the industry, as I have done before; I do not think that the industry would say otherwise.
We have to ensure that we are committed to nuclear co-operation. I would never joke about North Korea, but I cannot imagine that any responsible person in this Committee Room or in the whole Palace of Westminster could ever think that we could leave ourselves without nuclear safeguards, because then we would be like North Korea. We must be able to compete internationally and do the things that decent countries do in this field. Euratom has provided that ability, and it is our full intention to ensure that that continues.
I hope that the hon. Members for Southampton, Test, for Sheffield Central and for Bristol West will withdraw their amendments. To summarise my argument, I would say that each of them would complicate or delay—in my view, to no good effect—the vital process of preparation that we are now embarking on. We are already committed to the path down which the amendments are trying to push us, so although I am sympathetic to them, I argue that they are not necessary.
New clause 1 would undermine our position in our negotiations with international partners beyond the EU. It would change the purpose of the Bill to permit arrangements for a safeguards regime to be put in place only in the wake of failure of the discussions with the EU. We need to pursue discussions bilaterally and with the IAEA now, while we await the start of negotiations with the EU on our future relationship. In fact, as I said, those discussions are well advanced. Over the past few days, several hon. Members from various parties have asked the Government in various forums how confident we are that new bilateral arrangements can be put in place in time. Our answer is that we are indeed confident, but only as long as we can continue to push at full speed; we cannot afford to await the outcome of our discussions in Brussels.
Amendments 1, 3 and 8 would risk delaying the legislation necessary to implement the domestic safeguards regime; I do not believe that that is their intention, but that would be their effect. I will address the transition period when we consider new clause 2.
The Government’s strategy is to progress the Bill; to continue to negotiate with the EU to achieve the closest possible future association with Euratom; to continue to negotiate an agreement with the IAEA, the importance of which I cannot overstate; to continue to negotiate nuclear co-operation agreements with our key trading partners; to increase the capabilities of the Office for Nuclear Regulation to deliver a robust domestic civil nuclear safeguards regime; and to push for research and training partnership, having committed to delivering the UK share of the Joint European Torus project after withdrawal from Euratom. I hope that after hearing those arguments, Opposition Members will feel able to withdraw their amendments.
Dr Whitehead
I am sorry if what I am about to say brings forth an uncomfortable image in hon. Members’ heads, but I cannot help thinking that the Minister has been dancing adroitly on the head of a very small pin. I say that because it is extremely difficult to conceive of circumstances where we would have the closest possible relationship with Euratom after we have left it or “the exact same benefits” as we would have as members but where that would not consist of an association with Euratom that one might call associate membership.
That association could not be the same as existing associations with Euratom; it would have to be a close association that was tailor-made for UK circumstances. My hon. Friend the Member for Sheffield Central made the important point that our circumstances are not moving us towards Euratom, so the association might be a preliminary status that could be added to later. That association carries on from a helpful, mutually satisfactory, long-term working relationship with Euratom that has served the UK, Euratom and the wider international community tremendously well over a long period.
The circumstances of the closest possible relationship, as set out by the Minister, and of the “exact same benefits”, as the Minister set out in agreement with my hon. Friend’s statement, almost have to be—I cannot think how they could not, in fact—a close associate membership of Euratom that would enable the nuclear safeguarding part of Euratom that we are talking about to be undertaken. The Minister, in dancing so well on the head of this particular pin, has underlined why the close relationship would manifest itself in that way. If the Minister is saying that we must have the closest possible relationship but that we cannot or will not define what that should be because—I am not quite sure of the line of logic here—that might in some way impede the progress of our future negotiations, I should have thought that the opposite would be the case. It would be rather good for future negotiations if we had an idea of what we wanted to negotiate about at an early stage.
Richard Harrington
I have been listening carefully to the hon. Gentleman. For the sake of this question, let us say that our negotiating ploy was to go to Euratom and say that we want full membership—the same as before. Its answer would surely be either yes or no. The Government want to replicate the five areas that Euratom covers and for those to be as close as possible to membership.
The hon. Gentleman accuses me of dancing on the head of a pin. The thought of me dancing on anything is a dreadful one, which I ask hon. Members to put out of their minds.
Richard Harrington
Heaven forbid—although think about some of the people who have done it.
I am afraid that such a restriction invites a yes or no answer. The Government are saying, “We want the closest possible relationship on these different headings,” which may amount to what the hon. Gentleman says, but everything is in the negotiations. This is not a yes or no matter; these are complex negotiations. I cannot speak for him, but I believe that by using the wording we have—what I have put on the record about how close we want everything to be—we may well be asking for a series of arrangements that amount to what he wants.
Dr Whitehead
I thank the Minister for that clarification, which takes us a little further to the centre of the pin. The point is that the Bill clearly is not considered, has not been worked on and does not have its full set of secondary legislation attached, but it will practically come into force when the results of the discussion about the closest possible relationship are known. Let us say that, despite the Minister’s best endeavours to get the closest possible relationship, Euratom says no to everything—“You’re on your own; you’re out.” The provisions of the Bill must then come into place to get us a fully functioning nuclear safeguards regime that seamlessly takes over from the point at which Euratom says no. That is my understanding of the contingent nature of the Bill.
That does not mean—and it should not be taken to mean—that the Opposition are in any way trying to impede the work that needs to be done to get the Bill in place in order to fulfil that function. Of course that work needs to be done now and not at a future date. However, it would be really good, for the purposes of framing the Bill properly—in the way I have described—to know what the Government will seek as far as associate membership or the closest possible working relationship are concerned. I am considerably reassured by what the Minister says about the Government’s intentions in that respect, but it would be really useful to have that clear and in front of us.
I do not think that would in any way cause Euratom to say yes or no. Indeed, I would have thought that having a strategy in front of us that says what we want to achieve would be positive as far as Euratom is concerned, because it would then know exactly where we stood and exactly the limits of the closest possible working relationship we wanted, and it would be reassured to negotiate accordingly.
Richard Harrington
I worry that the shadow Minister and I are doing a duet on the head of this pin, because we are more or less in agreement about what we want. I thank him for his reassurances that he understands the need for the safeguards regime, which is the entire purpose of the Bill—it says so in the title. The Bill is not vague; it is deliberately precise, because we need to set up a safeguards regime.
I hope that I have made our strategy very clear, as I have on other occasions. Given that we have exactly the same intention, I ask the hon. Gentleman not to invite the answer yes or no, and to leave our negotiators to achieve the closest possible arrangement. That is what they are doing now, as confirmed at the Business, Energy and Industrial Strategy Committee yesterday.
This was supposed to be an intervention and it has turned into a speech, so I apologise for that, Mr McCabe. We need the Bill, and we need the Bill as it is, because in the doomsday scenario that the hon. Gentleman mentioned, where Euratom turns around and says, “Non,” or, “Nein,” we would still have a safeguards regime—not that any of us think that scenario will happen.
Dr Whitehead
That is absolutely right; that is the process by which the Bill comes into place, and that is the whole intent behind the trajectory of the Bill and the discussions ahead of it.
Sir Robert Syms (Poole) (Con)
Getting an agreement with Euratom might well be one of the easier things, but it will get caught up in all the other negotiations, which means the EU might not say yes until the other things are considered. Even if there is an agreement before March 2019, it might not be ratified by the EU for some months—perhaps years—because the whole process could take a while. That leaves a gap in which we need a regime that the world has confidence in, so that we can continue to have a nuclear industry. If we simply put our eggs in one basket by waiting for an agreement with Euratom, the risk is that we will be sitting around, unable to import, export or employ people. This is simply the Government’s straightforward backstop position, which I think is sensible.
Dr Whitehead
I thank the hon. Gentleman for that intervention, but I cannot help feeling that there is some degree of misunderstanding going on here, for two reasons. First, it is not the case, and never has been, that the Opposition understand the process of moving from Euratom to our own arrangements—parallel to, and as close as possible to, Euratom—as involving any gap at all. Clearly, we need to have a regime in place to deal with whatever contingent circumstances take place; we are completely at one with the Government on that. We do not know exactly what those circumstances will be, so we need to be ahead of the game and have those contingent arrangements in place. Everybody, on both sides of the Committee, is in complete agreement on that point.
Secondly, however, it is not necessarily the case that the close association that we might want to seek will get embroiled in the rest of the EU withdrawal negotiations, because the Euratom treaty is separate from the EU treaty. Even if one considers them to be conjoined, it is more than possible—in fact, highly probable—that the actual negotiations will proceed on the basis of those two separate treaty arrangements, and therefore will not get entangled in those overall negotiations.
We are seeking clarity on what those arrangements might be; arrangements that would not stop the Bill from happening but might be there in place of the Bill, circumstances permitting. One builds the house and the roof hoping that it will not rain—at least not while one is still building—but clearly one has to proceed in all circumstances. That seems to me to be essentially what we are doing today in Committee. It is a separate point from what we might to seek to achieve in terms of our future relationship with Euratom, and that is what the amendments are about.
To end the suspense for the Committee, if it is still wide enough awake to be in suspense—I am sorry if I have gone on for rather a long time on this point—we particularly want to press for the purpose clause, because we think that would clarify a number of the other intentions. I understand that the new clause has essentially been moved up in the order of consideration and is being debated today, but nevertheless as a new clause it will be voted on at the end of our proceedings, so it is not a question of asking whether we want a Division on it, because that will not happen this afternoon. The new clause has been moved into this debate, absolutely rightly, and has served its purpose well in framing the debate in the proper place; and because the amendments are contingent, in effect, on that clause, it is not our intention to divide the Committee on those individual measures this afternoon. However, depending on what happens with the vote on the purpose clause at the end, it is conceivable that we would return to them on Report. However, for this afternoon’s purposes, we do not intend to divide the Committee. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Dr Whitehead
I beg to move amendment 4, in clause 1, page 2, line 41, leave out from “must” to the end of line 44 and insert—
“(a) publish an impact assessment;
(b) consult—
(i) the ONR,
(ii) the National Audit Office, and
(iii) such other persons (if any) as the Secretary of State considers it appropriate to consult; and
(c) lay before Parliament a statement declaring that he or she is satisfied that the staffing and financial resource available to the ONR is sufficient for the purpose of assuming responsibility for nuclear safeguarding in the United Kingdom.”
This amendment would require the Secretary of State to declare that the ONR has the resources necessary to take on extra responsibilities for nuclear safeguarding in the UK.
The Chair
With this it will be convenient to discuss the following:
Amendment 12, in clause 1, page 2, line 44, at end add
“and must publish the consultation and any written submissions”.
This amendment would require the Government to publish any consultation carried out before this Act is passed which could be relied upon to satisfy subsection 4 of Clause 1.
Amendment 13, in clause 1, page 4, line 5, after “carried out” insert “and published”.
This amendment would require the Secretary of State to publish any consultation on the regulations which will create a nuclear safeguards regime.
Dr Whitehead
This group of amendments revolves around the question of the staffing, the preparations and the enabling activities that need to take place to ensure that the nuclear safeguards regime being run entirely in this country can take place properly, smoothly and immediately, as we have already discussed. Amendment 4 sets out pretty exactly what we want to achieve in relation to an understanding of the preparedness for the new regime. It would require a number of things to happen before the legislation is fully in place. First, an impact assessment would have to be published—I hope that is on its way anyway. One has not been published yet, but I would welcome an indication from the Minister on what is in the pipeline in that respect.
Secondly, there should be consultation with the ONR, the National Audit Office and such other persons as the Secretary of State considers it appropriate to consult. Following that consultation, the Secretary of State should lay before Parliament
“a statement declaring that he or she is satisfied that the staffing and financial resource available to the ONR is sufficient for the purpose of assuming responsibility for nuclear safeguarding in the United Kingdom.”
The amendment would require the Secretary of State to set before Parliament, following consultation, a clear statement that he was assured—there would be information in the statement to underline that assurance—that it really is reliably likely that the ONR will be able to take up the mantle of nuclear safeguarding from day one, when we are no longer in a position to do that through Euratom.
The reason I think that is important arises from what we know about the present position of the ONR and, indeed, what we heard in oral evidence. We know that the ONR is mainly funded through charges to the nuclear industry at present; it recovers the money for its operations generally from a charge on the nuclear industry. However, it also receives some grant funding, which essentially pays for the nuclear safeguarding work, while the charges on the nuclear industry essentially pay for the ONR’s other functions, which are not the subject of the Bill.
That distinction is important, because the Government intend to halve the grant to the ONR in the period up to 2020. At the outset of these negotiations we face the prospect of the ONR actually being able to do less work than at the moment. If it is to continue to do the amount it does at the moment, it will probably have to levy substantially more charges on the industry in order to make up for the loss of grant up to 2020. At the same time, however, this Committee is saying that the ONR will have to undertake a whole lot of new work that it had not previously budgeted for, that has not been in its terms of reference for a very long time and that will clearly require a lot more resource. As we heard in oral evidence, that is no mean amount of additional work for it to undertake.
We know that Euratom employs about 160 staff for all its functions, 25% of whom focus on UK installations. It does not take a great deal of maths to conclude that some 40-odd employees are pretty much focused on the UK. One can reasonably assume that it would be necessary to add that sort of level to the ONR’s complement in order to allow it to take on the work that Euratom currently does on nuclear safeguarding.
At the moment the safeguards unit within the ONR comprises eight professional staff. Between now and March 2019 the ONR will have to find from somewhere roughly 32 staff—qualified, highly skilled and trained nuclear inspectors able to take over that responsibility. That is in addition to all the other things ONR has to put in place, such as additional IT systems and a whole lot of additional administration and resources, in order to allow it to take on board that nuclear safeguarding role.
Trudy Harrison (Copeland) (Con)
Is the hon. Gentleman aware that the current safeguarding inspectors are members of the Prospect union? I have had sight of the job specification for our new nuclear safeguards workers. They require a degree, knowledge of nuclear material and potentially developed vetting clearance. Much of that is already present among the staff at Sellafield and across the 17 Nuclear Decommissioning Authority sites. They are already compliant.
Dr Whitehead
Indeed. My point was that, if we had to train nuclear inspectors from scratch, that would take about five years. As the hon. Lady rightly says, a number of people are already familiar with the necessary areas in order to get a position as a nuclear safeguard inspector, but those people have not all had experience of nuclear safeguarding issues; they have not had to because Euratom has carried out that role.
I asked Dr Golshan whether we could steal Euratom inspectors who might want to remain in this country, assuming they were allowed to do so, when the Euratom inspection regime comes to an end and ours starts. The answer was, “Maybe, that depends.” We cannot rely on that, so we have to get inspectors from somewhere else. It may well be that we can shorten the training period considerably by converting to nuclear safeguarding people who already work in the nuclear industry and are well versed in a number of general areas, but we should not underestimate the time that that would take to get right. It is not just a simple question of going along and saying, “You’ll do, you’ll do, you’ll do. There you are. You are now nuclear safeguarding inspectors.” As I am sure the hon. Lady is aware, that is not going to work. There will be a lot of work involved in getting the inspectors in place.
Sue Ferns said that there are specific aspects of an inspector’s role to be considered:
“This is a warranted role; this is not just working in the industry. It is not just about knowledge, but experience and commanding the confidence of the companies and the organisations that you deal with, so there are very specific aspects to that role.”––[Official Report, Nuclear Safeguards Public Bill Committee, 31 October 2017; c. 35, Q69.]
She also alluded to the relatively small pool in which we are fishing. We have not just to fish in the pool; we have to fish very accurately and attract a good proportion of the people in the pool, in order to suddenly fill the gap. Consequently, she put a considerable question mark against whether it was possible for the ONR to be as ready as we would like for the tasks that we are going to give it.
I sincerely hope, as I am sure we all do, that those matters can be resolved. It may be a question of making sure that the ONR is funded to the extent that it can properly undertake the activity of fishing in a small pool, perhaps with pound notes attached to the end of the fishing line. There may be a number of other factors relating to nuclear inspection coming in. Euratom may be prepared as part of an associate agreement to lend the UK safeguarding inspectors. A number of different courses could be pursued. There is, nevertheless, a big question mark against the capacity and ability of the ONR, even with all best endeavours in place, to be properly ready in time, given its present circumstances, its possible future circumstances and how it will address those.
For that reason, it is important at the appropriate time to have a sign-off from the Secretary of State that we really have not just a regime in place, but the resources available to carry out that regime in the new circumstances it will bring up. That appropriate time would be when all the different possibilities have been explored and the different ways of doing it have been looked at. Amendment 4 essentially requires the Secretary of State to lay a statement before Parliament that he or she is satisfied at that point—not a hope that it is going to be all right, but a statement saying, “Yes, it looks like it is all right now and we can safely proceed on the basis that we know we have not only the powers in place, but the people to subsequently carry out those powers.”
Amendments 12 and 13 are associated with amendment 4. They deal with the consultations that the Bill sets out will take place and are in respect of those activities, nuclear safeguarding in general and payments towards compliance costs. I have mentioned that the Secretary of State provides some money for ONR and that some money for ONR comes from the levies it places on the nuclear industry. The Bill makes provision for the Secretary of State, by regulation, to authorise and require the ONR to make payments towards compliance costs. It states that compliance costs mean
“costs of complying with nuclear safeguards regulations or with specified provisions of nuclear safeguards regulations.”
To make those payments, the ONR must obviously get the money from somewhere, either from grants or from a levy. As the clause says, there will be consultation on that, but the clause does not say that any of those consultations should be published. Therefore, we may not know what the consultations are about, what they say or when they are completed. The amendments are both minor, but they tie the process up properly with a little bit of ribbon, to ensure that those consultations are published and in the public domain. Then we will know what has happened in those consultations, which are potentially very important, given everything that we have said about ONR’s readiness for its purpose. The amendments ensure that the consultations are in the public domain and are properly reported and discussed.
I believe that these amendments are helpful in terms of what we know is the task in front of us, and how certain we want to be in this Committee that we are able to do what we want to do. I will go beyond calling them helpful and say that it would be irresponsible to proceed to the end of this legislation without some method of ensuring that we can deliver on what this House will have decided. I think that all hon. Members would agree that it would not be the first occasion on which this House legislated on something without securing the means to ensure it happened. In this instance it is not just a money resolution at the end of the legislation, but ensuring that an industry is equipped to do the different things that we want it to do and that it previously was not carrying out.
Again, we are in new territory, and we need particular measures in this legislation to reflect that fact. We also need to be sure, in making our way through that new territory, that we are doing so as safely and securely as possible.
Richard Harrington
I was brought up in Sheffield so it is all the south of England to me. Maybe I misunderstood the question asked by the hon. Member for Nottingham North, but I thought he was asking whether there would be enough staff in place, as opposed to whether we would have a suitable regime ready by the end of it. If I misunderstood him, I did not mean to. That is why I made the point that it is impossible to tell—because it is a recruitment programme.
When I said the word “hope” to the hon. Member for Leeds West (Rachel Reeves), the Chair of the Select Committee on Business, Energy and Industrial Strategy, she said that when she buys a lottery ticket she hopes she will win. I had to point out that it was not that kind of hope but an informed hope based on a proper recruitment and resources plan, which will be in the assessment that is wanted. However, that has to be based on assumptions. Everything has to be based on assumptions.
Although I do not make light of the number of people involved—be it 15, 30 or whatever—it is not hundreds or thousands of people. It is in the ONR’s sphere of what it estimates. To return to the example from my hon. Friend the Member for Copeland about Sellafield, it could be that a lot of people apply for these jobs and they are partly qualified because of their degrees and other experiences, so the recruitment could go more quickly than expected. Like in any forecast, we need to make assessments, but I have no reason to believe that there will be a problem with recruitment. The first phase has already started. In January 2018 it goes on to the next phase, and that has been planned for properly.
Dr Whitehead
Does the Minister not agree that because we are in a position where not enormous numbers but unprecedented recruitment will be going on in the ONR, as he has said, we cannot be absolutely certain that everything will go right and we cannot predict the future with certainty? Surely that is why we need some kind of report and statement towards the end of the process—whether it is in the form of the amendment or another form that the Minister might like to offer—to see we really are in a position where our hope has been realised, things can happen as hoped, and they are going well and will do so subsequently. It may not be necessary for that to be in the Bill, but some kind of assurance that the Minister would bring such a report to the House in particular to allow us to examine the proposition would be helpful.
Richard Harrington
That is a typically sensible suggestion from the hon. Gentleman. I will give that some consideration as to form or whatever, if he will bear with me. I remind hon. Members that the Bill already requires the Government to consult with the ONR and other persons that the Secretary of State considers appropriate. I know it may or must seem appropriate, but the intention is to consult widely.
On ONR capacity, which is the core of many of the amendments, I recognise the importance of transparency and the need for Parliament to be assured that the ONR is adequately resourced to set up the absolutely critical domestic civil nuclear safeguards regime. I have continually stated that we will allocate to the ONR the funding necessary to set up the regime. We have been transparent about the costs and resources of setting up the regime. Current estimates of the set-up costs are set out in the explanatory notes to the Bill. They are under my file, but from memory they are about £10 million in set-up costs and about that annually, which is roughly the cost of Euratom at the moment to perform the same function. I know the figures are approximate, but they give hon. Members a perception of the scale.
The relevant section is “Financial implications of the Bill”, which I will read now, in case hon. Members do not have it in front of them—they will not have to scurry around for it. It says:
“The public expenditure resulting from the Bill are the cost of the establishment and operation of the new regime by the ONR in line with the regulations that will be made under the powers in the Bill.”
That is the £10 million. It continues:
“The costs to set up a UK domestic safeguards regime (which remain subject to further analysis) are potentially up to £10m. This would include procurement of a new IT system, recruitment and training of…inspectors and strengthening institutional capacity to deliver the project. This cost can be met from within BEIS’s Spending Review allocations. The cost of any equipment currently in the United Kingdom but belonging to Euratom is a matter currently under negotiation with the European Union.”
Ideally, we will want to purchase the kit: the cameras, recording equipment and other electronic surveillance equipment and so on. It continues:
“The regime is also likely to involve an ongoing cost of around £10m a year—
sorry, I have said this before, but just to confirm—
“which is in line with the United Kingdom’s current cost of Euratom safeguards activity in the United Kingdom.”
The Office for Nuclear Regulation has also been clear, in evidence to the Committee, and to the Department, about the resources required. The amount has not just come out of the blue. We are working closely together to ensure that the needs of the ONR are met. My Department has already agreed to provide funding for initial work undertaken by the ONR on scoping and additional recruitment.
The ONR currently anticipates that the next tranche of recruitment will be in 2017. To correct myself, when I previously referred to the beginning of 2017 I was mixing it up with the current round; it will be at the end of 2017. That is what it has asked us for; it is not the Government imposing anything or saying we think it is how it should proceed. It is committed to doing whatever recruitment is necessary for what it knows it has to do. I hope that I have assured hon. Members that we are working closely with ONR to ensure that sufficient resource and capacity will be in place to carry out the work needed. It is unnecessary to add to the Bill the level of detail in the amendment. It would not make any difference to a programme that is already costed and proceeding.
On amendments 12 and 13 and the issue of consultation more broadly, the Opposition made some valid points, and I agree wholeheartedly that, as was said on Second Reading as well as today in Committee, consultation is vital in the development of any regulatory system—and even more so when it concerns something of such national importance. As the hon. Member for Nottingham North said, what is important may not be the thing that makes newspaper headlines; the general public may not realise something is important, but here we can all agree that this matter is critical.
I hope that Members on both sides of the Committee will agree that there have been great improvements in recent history in the working relationship between all Governments—I am not making a point just about the present Government—and the nuclear industry regulator, as well as with a wide range of stakeholders across the industry. Probably the main stakeholder, of course, is Lord Hutton, the former Secretary of State in the precursor Department to mine—and, in fact, nearly every other Department; it is very much a cross-party kind of industry. People listening to our proceedings might have felt that the Government had a disagreement with the two unions that gave evidence, but in reality there is far more in common between us—as there is in Committee today—than there are differences.
A good relationship is important, but I accept that that does not stand in the place of appropriate legislative mechanisms for consultation: I do not think that it is just a question of a few people getting around a table and having a meeting. I accept that consultation must be statutory; and, quite properly, it is. Future regimes or Governments, and future stakeholders, might have different views about each other. A Government who did not want a nuclear industry might behave differently, and so might a nuclear industry that did not want such a Government. I accept that things must be formalised.
The Bill therefore places clear requirements on the Government to consult. We have already made it clear that the development of the regulations that underpin the Bill will be subject to detailed consultation with the regulator and industry. Hon. Members will be aware that it is policy for such consultations to be made public, and we intend to do so in this case.
Dr Whitehead
The Minister is such a reasonable chap that it is fairly difficult to get too excited about some of the potentially contentious issues before us. This afternoon, we have made our points as strongly as we can about our concerns about what one might call the do-ability of the process over the next period.
The Minister said to me this afternoon that he is willing to consider a method by which it would be possible to report to the House what is happening towards the end of the process of recruitment and the shaping up of the ONR to put itself in a position to be able to undertake the duties that we hope it will undertake. If the Minister can devise a method whereby some kind of report to the House may be made, or an opportunity provided to examine the process in front of the House, as far as we are concerned it need not necessarily be on the face of the Bill. For that reason, we do not want to divide the Committee on the amendment.
Richard Harrington
I am perfectly prepared to give that undertaking. I cannot think quite how to do that at the moment, but I will give it a bit of thought. What the hon. Gentleman is suggesting is very reasonable.
Dr Whitehead
I thank the Minister for that statement.
On the other amendments and the publication of the results of the consultation, I am almost a little disappointed that such an extremely modest suggestion could not be taken on board by the Government, but I hear what the Minister says about the intention to ensure that there is full publication and knowledge of the matters to do with the consultation. Therefore, we will not proceed to a vote on those amendments.
I have, however, one note not of complete concord to strike. An impact assessment should really have been available to the Committee before we started proceedings on the Bill. The Minister said that one will be available before Report, but that means that a lot of the information will not be available to us while we are undertaking our deliberations in Committee. I am glad that an impact assessment will come out, and I appreciate that the Bill was introduced considerably ahead of its anticipated time, but it is essential that impact assessments are available in Committee to inform the decision making of the members. I am sorry that one was not available on this occasion, although I understand the position in which the Minister found himself.
Richard Harrington
The hon. Gentleman’s explanation for the lack of an impact assessment is correct. I would have liked to have had it in Committee, but I am much more happy to have made the progress we have. When I say “before Report”, I do not mean the day before Report or something like that. I hope the impact assessment will be more imminently available than that and I fully intend it to be so, but Government procedures have to be gone through. My priority was to get the Bill through, not to stop any form of discussion of the impact assessment or anything like that. I thank him for his good grace and understanding—the position he stated was correct.
Paul Blomfield
The Minister is talking about a very specific impact assessment on the work of the ONR, but a wider impact assessment has been completed of the impact of the withdrawal from the European Union on the nuclear industry. It was one of the 58 sectoral assessments that we debated in the House yesterday, when I made the point that it would help the work of this Committee if that assessment were made available to us. Does my hon. Friend agree that the Minister might be able to give a commitment on that point too?
Dr Whitehead
My hon. Friend is absolutely right. That assessment would inform this Committee considerably and, since we are not meeting for a few days now, it might be possible for it to be available to us when we come back from the recess. If the Minister can use his good offices to make that available, that would be considerably appreciated by Members on both sides of the Committee.
Richard Harrington
I cannot comment on that—not because I do not want to, but simply because it is not within my Department’s regime. I will obviously look into the subject, and we are happy to provide whatever information we have. I was not present in Parliament at the time of the debate—I think it clashed with my Select Committee evidence—so I do not know what was said. The impact assessment, which is directly in my control, will be ready imminently for the hon. Gentleman’s reading. It will not be this weekend—I know he enjoys reading such things over the weekend—but I am sure I can fill one of his weekends very soon.
Dr Whitehead
So that we do not finish on an intervention, that is my lot. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Chair
We have had a pretty extensive debate, and I can see the Whip indicating to me. I do not think there is need for a clause stand part debate, unless anyone is absolutely desperate to have one. I am conscious, Minister, that there are a couple of points at the top of page 2 to which specific reference has not been made. I do not know whether hon. Members want a very short clause stand part debate. If they do not, I am more than happy to move on. I am going to assume that hon. Members feel we have done sufficient duty to this subject.
Clause 1 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Rebecca Harris.)
Nuclear Safeguards Bill (Second sitting)
Alan Whitehead ExcerptsTuesday 31st October 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 31 October 2017 - (31 Oct 2017)
Mary Robinson (Cheadle) (Con)
Q
Angela Hepworth: On the safeguards regime first, our concern is about the amount that has to be done to have the safeguarding regime in place in time. As I say, in principle we are very happy with the idea that a domestic regime should be established, rather than the Euratom safeguards regime, but we are conscious that there is a lot to do in the time available to get that regime in place. It is not the principle of it; it is the timing and the implementation.
Likewise, we are conscious that the other key components that we need to have in place include a replacement agreement with Euratom, which would cover issues relating to the ownership of nuclear material, and our future trading relations with Europe for nuclear materials. Obviously, that is subject to the negotiations that are going on in Brussels at the moment. I have regular contact with the officials who are leading those negotiations, and we are fully aligned with the objectives they are perusing. Again, it is subject to the success of those negotiations.
There are other key things that have to be put in place. We will need nuclear co-operation agreements with key third countries. I have been told that the negotiations are under way and are progressing well. Again, our concern is the timing and how it fits with the timing of putting a safeguards regime in place. Those agreements cannot be finalised until there is certainty about the domestic safeguards regime, so it is about the timing of getting all of that done.
The other key issue for us is the movement of people. We are an international business, and the nuclear industry is an international industry. We rely on having access to experts from Europe and further afield. The roles in the company that most draw on skills from overseas are engineering roles—we are reliant on being able to draw in engineers. Building Hinkley Point will require a workforce of 25,000 people. We are doing an awful lot to try to build up skills in the UK, but we expect that, to deliver Hinkley, we will need to be able to draw on workers from overseas. I would not expect that to be solved within the Euratom arena, but that is a key issue for us as a nuclear operator.
We also have to ensure that we have got an export control regime in place and support for nuclear R and D. Those are the key issues for us relating to Euratom.
Dr Alan Whitehead (Southampton, Test) (Lab)
May I ask you about the Euratom costs relating to safeguarding, which may not go to Euratom but to the Office for Nuclear Regulation as a result of the transfer of responsibility for safeguarding from Euratom to ONR? I understand that EDF Energy already pays into ONR as a contribution to its general costs, but does not pay anything to Euratom for safeguarding. Is that right?
Angela Hepworth: That is right. We have to distinguish what we pay for from the ONR at the moment. As a nuclear operator, we are required to comply with certain safety and security regulations, and we pay for the ONR’s role in inspecting our stations to ensure we comply with our obligations. That is absolutely right, and we expect that to continue. There is a distinction to be drawn between that and compliance with the safeguarding regime, which is the responsibility of a member state. At the moment, the UK Government pays for that to be done via its contributions to the EU budget. As that is a member state responsibility, it is clear to us that it should be the UK Government who meet those costs in the future, rather than look to the industry to cover them.
Dr Whitehead
Q
Angela Hepworth: As I understand it, it is funded via the EU budget contribution. That is how it is funded at the moment.
Dr Whitehead
Q
Angela Hepworth: I think the cost should be met by the UK Government, given that it is discharging a UK Government responsibility.
Dr Whitehead
Q
Angela Hepworth: I think we would welcome the assurance; whether that is provided on the face of the Bill or separately is less of a concern to us.
Rachel Maclean (Redditch) (Con)
Q
Angela Hepworth: It would be first and foremost the responsibility of the ONR to put the safeguarding arrangements in place—if that is the element that you are particularly concerned about. I know that one of the early activities they are undertaking is recruitment of the experts that they need in order to do that. They need to be able to do that and to put in place the processes and systems that they need to be able to discharge those responsibilities. What we would welcome as an operator is a timetable from the Government and the ONR that sets out exactly what steps need to be taken and when, in order to have a regime operational at the point where the UK leaves Euratom.
Paul Blomfield
Q
Angela Hepworth: Again, we are looking for assurance and clarity. I am less concerned about whether that is set out in the Bill or not; it is assurance and clarity that the industry is looking for.
Dr Whitehead
Q
Angela Hepworth: In terms of a future relationship, EDF Energy has been clear from the outset that far and away the best outcome for the UK nuclear industry would be to remain in Euratom. That remains, we think, the right answer for the UK nuclear industry. Assuming that that is not possible and that we have to look at a future agreement, the models of association agreements in place now are limited to engagement in research and development programmes. That is valuable, but it does not address the key issue that we are concerned about, which is the movement of nuclear materials. What we are most concerned about in all of this is our ability to move nuclear fuel, nuclear components, information and services. The current framework of association agreements would not meet that need. If that were going to solve the key issues, we would need to think of some different model of association.
Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)
Q
“The UK Safeguards Bill says little about what a new regime will look like.”
You also say that if there were any changes or amendments to regulation,
“Neither EDF nor the wider UK nuclear industry are…included as statutory consultees”.
Do you think that the current consultees include the wider sector, or are they quite limited?
Angela Hepworth: As I understand it, the Bill says that the ONR and such other people as are deemed appropriate must be consulted. We would welcome consultation with the broader nuclear industry.
Dr Whitehead
Q
I wonder if you might briefly share with us what you think might be possible so that the Bill is not a contingency, and whether you think the timescale that we have in front of us over the next period is sufficient to bring in either associate membership, perhaps, or similar arrangements with Euratom. Alternatively, if the Bill is to be used as a contingency, do you think that the timescale in front of us—bearing in mind all the detail of the secondary legislation that we need to get through as far as the Bill is concerned—will be sufficient to make that happen?
Sue Ferns: I think the answer is that we do not feel confident that the timescale is sufficient. From speaking to members in the ONR who essentially have to deliver the key provisions of the Bill, it is clear that they need to build an IT system to log the data properly. They need to have resources to deliver what is required, bearing in mind that we are a heavy utiliser of Euratom resources in the UK. As the previous witness said, we need to make sure that there are inspectors in place to be able to police the regime.
It is easy to say that; it is much more difficult to deliver it. Nuclear inspectors are thin on the ground at the best of times. Absolutely, ONR is doing its very best to try to ensure that it can expand its inspector resources, but I think even ONR feels that it is a challenge. The question is where will these people come from? The only obvious source is from elsewhere in the industry, because there are not qualified nuclear inspectors who are currently out of the labour market. That is absolutely a major challenge. The honest answer to the question is that I do not know whether the timescale is sufficient, but at this stage we certainly do not feel confident about it.
Kevin Coyne: I would answer that question with two responses. First, as I said, we as a union hoped that we would have remained in Euratom. We do that because we believe there is not a necessity to leave Euratom in effecting Brexit under article 50 and through article 160a. It was possible, I understand, to remain. That is important, because of the uncertainty that we now believe is cast over that.
As I said before, our concern is mainly with our members’ interests and with jobs. Sizewell B, for instance, will be in operation until 2034, and it relies extensively on components from the United States. It is very important that the co-operation agreements that the previous witness talked about are in place by 2019, and there must be serious doubt with the inspectorate in its current state. I believe that the numbers are 160 inspectors, and the ONR has fewer than 10 in place currently. So, there is the training and the programme and—importantly—all of that must cast doubt upon our ability, and if that is the case it will affect the smooth operation of nuclear plants in future, until there is a regime in place that equally matches the plants.
Secondly, I would argue that there is an impact on new nuclear development for the regime. For instance, there is the whole fuel cycle in Britain, which is gearing up to be a serious and important new operator of new nuclear build. We want within that the whole fuel cycle—the whole of the nuclear operation. As you know, in Preston we have a factory—Springfields—that produces fuel, which is wholly dependent on mixed fuels from other nations, co-operation agreements and the operation of Euratom in ensuring that that fuel supply is there and available.
There is a real threat, because of the problems with Westinghouse, that that plant in Preston would suffer as a result of the safeguards not being in place in time. That would result not only in the loss of jobs but in issues for the fuel cycle itself, for Britain’s ability to recreate the whole of the nuclear cycle for the export orders for the industry, and for the jobs that that entails.
Eleanor Smith (Wolverhampton South West) (Lab)
Q
Kevin Coyne: I will defer to my colleague, who is from the union that represents these people.
Sue Ferns: How long to train a nuclear inspector?
Paul Blomfield
Q
Sue Ferns: The concerns are set out in our evidence. If you look at sections 20 to 22 of the Health and Safety at Work etc Act 1974 and schedule 8 to the Energy Act 2013, they set out in some detail what the powers of the inspectors will be. I know there is reference to that in the schedule to the Bill. These concerns come directly from people who will have to do this job. As warranted inspectors, they feel that it is important to have those powers in the Bill. It is important for purposes of parity, to ensure continuity—these things should not be left to the discretion of future Ministers—and also, as we have discussed, for external confidence in the way the job will be done. That is why we believe very strongly that those powers should be specified. I have not heard an argument to say why, if it is good enough for the 1974 Act and the 2013 Act, we should contemplate a change in practice for this piece of legislation.
Dr Whitehead
Q
Sue Ferns: I think achieving that would be an important step forward. However, as we have set out in our evidence, we have identified three other matters, because you would then have to be clear about what safeguarding means in law. The three bullet points in paragraph 5 of our evidence are points where we think that specific clarity is required in relation to what that would mean in a safeguarding regime. Is that clear?
Dr Whitehead
Q
Sue Ferns: I am not an expert on how to draft legislation, but I understand you are asking whether we should take the schedule from the Energy Act 2013 and put it in the Bill, along with any other points that may need to be included. That is certainly our preference, and it is certainly the preference of the members we represent in these roles.
Kevin Coyne: In addition, we would indicate that your knowledge is greater than ours at the moment on the 2013 Act. The importance of the inspectorate is its neutrality and independence. If you are saying that there is an element in there that is currently switched off that can be switched on, that would be an important contribution, but you must ensure that it has that neutrality and independence, because that is what gives status and quality to the current inspectorate through Euratom. I do not go to bed at night reading the 2013 Act, but I cannot remember it addressing the independence issue, which I think would be an important element.
Dr Whitehead
Q
Sue Ferns: My understanding is that the IAEA will require certain standards to have been met before anything else can happen. What I understand, though, is that during the Second Reading debate on the Bill, there was a lot of talk about replicating the Euratom powers. My understanding is that that is not necessarily the IAEA hurdle, because I think the IAEA hurdle is slightly lower than replicating the Euratom powers. Certainly, there will be a requirement to meet IAEA standards.
Trudy Harrison
Q
Kevin Coyne: I think that is an area which is of serious consequence. I think it is generally not well known—the fact that Euratom covers the transportation of materials—or that isotopes that are used in the NHS, for instance, come from Holland and other countries. We do not have the reactors in this country to produce them. I understand what you say about the registration. We highlighted that as a concern because there is a two-day, three-day shelf-life; this comes from us as a union that operates within the NHS at quite an extensive level. In terms of the delivery and transportation of that, there are sometimes delays. So our point is that the change of regimes and the difference in what might occur may cause that to be delayed even further and therefore impact upon the NHS itself. We make no stronger point than that we ought to look at the impact upon isotopes in hospitals.
Richard Harrington
Why not? I am quite happy to. That function, currently done by Euratom, will be done by the new safeguards regime. It will be responsible for examination and testing and making sure there are suitably qualified inspectors, in the same way that Euratom does now.
Dr Whitehead
Q
Professor Matthews: Clearly, the operation of the Office for Nuclear Regulation requires a range of different roles. I would see no problem with adding an additional role to the range of roles that are already in the organisation. It is just the physical people are different people who do these different things. Indeed, nuclear inspectors themselves have different backgrounds and specialisations, and diverse education as well. I suppose it is extending the range of what the Office for Nuclear Regulation does.
Dr Whitehead
Q
Professor Matthews: I would have to look at the documents and examine them in detail to be able to answer that question fully. It is a different role. I would expect it not to be covered within the current definitions in the documents, but I do not have access to them and cannot check that now. But I would be very surprised if it was covered. It would need something added.
Alex Norris
Q
Professor Matthews: The young people that I am encountering in my current activities are ready to take on responsibility and do things. I am very impressed by them. I am sure there are people who are capable of taking on these roles. The only problem is that there is competition. Those same people are valuable and can be used in all sorts of ways. Whether it is possible to assemble the right people quickly to be able to avoid any hiatus in the operation of our industry is another matter. Certainly, at the moment, the people that we train have no problems finding jobs.
Richard Harrington
Thank you for that, Professor Matthews. You are of course using my argument for why we need the Bill; thank you for supporting it. Dr Mina Golshan, whose organisation is responsible for recruiting the 15 people we are talking about, said that recruitment had already started. Once the Bill proceeded beyond Second Reading—I thank everyone, including Opposition Members, for voting for that—it meant that the financial resources needed for the IT and recruitment are provided. We are very well aware of that.
I thank you for your de facto support for the Bill. I have of course noted the points you have made, and I will be very happy to chat about them on another occasion. The purpose of the Bill is precisely to get over some of the obstacles that you are talking about and prevent what you have explained would happen—as we accept would happen—if we did not have a safeguards regime in place.
Dr Whitehead
Q
Secondly, I understand that the Torus fusion project at Culham will be a subject of safeguarding inspection. Will that be financed, subsequent to our leaving Euratom, in a way that is commensurate with its present level of assistance, which largely comes, as you are aware, from EU funding? Do you have any comment on that?
Professor Matthews: There is a difficulty here and I do not know if it is recognised in the Bill; it perhaps needs scrutinising. The only mention in the Bill and in these discussions is of our fissile materials. We are talking about uranium, plutonium and other axinite isotopes, and precursors such as thorium, which can be converted into fissile materials. In the case of Culham and the fusion programme, they use tritium. Tritium is a material that comes under safeguards, which is not a fissile material. It is a material that is a component in hydrogen bombs, and it is controlled. I remember getting into trouble as a young scientist. I was asked to assess the use of lithium-6 as an absorber for a fast reactor project. I phoned up a French supplier of lithium-6, and next thing I had security down on me, because tritium is produced from lithium-6 and is a controlled material. I do not know whether any consideration is being made of the control of tritium with respect to Culham and nuclear safeguards.
Dr Whitehead
Would there be other materials that are not fissile but would also be controlled and inspected under safeguards?
Professor Matthews: We are getting into areas that we cannot really discuss here.
Richard Harrington
That is beyond the scope of the Bill, but perhaps we could discuss it, although not necessarily now, in the evidence session. I am happy to discuss it, but I suspect that your interpretation is correct, Mr Gray, and it is beyond the narrower scope of the Bill. I am happy to discuss it with the Shadow Minister.
Dr Whitehead
One might argue that the scope of the Bill is too narrow for the safeguarding that we need to undertake.
The Chair
It does not matter. The scope of the Bill is the scope of the Bill. Let us not get into a chat among ourselves. The reality is that the Bill is as printed, and it is the Bill as printed that we have to discuss, under the long title and the short title. Of course, within that we can amend it as much as we like. My instinct is that the Committee have done our work for the day. Thank you very much, Professor Matthews, for your very useful evidence, both written and in person. I assure you that it will be taken note of in the discussions that lie ahead, starting on Thursday, when my colleague Mr McCabe will be in the Chair. The Committee will see me again, assuming that we sit—we will no doubt sort that out—next Tuesday.
Ordered, That further consideration be now adjourned. —(Rebecca Harris.)
Nuclear Safeguards Bill (First sitting)
Alan Whitehead ExcerptsTuesday 31st October 2017
(7 years ago)
Public Bill CommitteesRead Full debate Nuclear Safeguards Act 2018 View all Nuclear Safeguards Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 31 October 2017 - (31 Oct 2017)
Mary Robinson (Cheadle) (Con)
Q
Dr Golshan: There are a number of aspects. The first one is to ensure that the secondary legislation is in place at the right time, because that provides us with the mechanisms to exercise our powers. The Bill itself is an enabling part—it gives us the fundamental powers—and the secondary legislation gives us the mechanisms to deliver. Secondary legislation will also give us some certainty in relation to what guidance and standards we need to develop to make this happen.
For us, we need to have an IT system; a safeguards information management system. It is a live system that enables us to get data from our licensees, to process those data and to put them into a reporting format that the IAEA currently receives from Euratom. We are working on that; it is at proof of concept stage at the moment. Once we have established that we are able to do it, we will need to move into a phase that determines whether we are going to do it in-house, tender it out, or have a combination of the two.
Dr Alan Whitehead (Southampton, Test) (Lab)
Q
Dr Golshan: I should say that, on negotiating nuclear co-operation agreements and completing the discussions with IAEA and Euratom, although we provide advice to the Government, it is not for me to sit here and determine or estimate a timetable. It is really strictly for the Government to conduct those negotiations, and I think that it is perhaps a question better answered by them.
Dr Whitehead
Q
Dr Golshan: It is fundamental to it. We need to have a basic safeguards regime—a domestic safeguards regime—in place that enables the UK to demonstrate that it is fulfilling its international obligations under various treaties. Once that is in place we will be able to demonstrate that we have a rectified domestic safeguard arrangement in place.
Dr Whitehead
Q
Dr Golshan: Yes.
Dr Whitehead
In order to demonstrate to the IAEA that we are able to fulfil a function relating to nuclear safeguards outside Euratom.
Dr Golshan: Absolutely.
Dr Whitehead
And those discussions, I understand, are proceeding at the moment but have by no means reached any conclusion. Are you confident that in terms of replicating the UK’s safeguarding function, the basic structure you have outlined to us this morning that needs to be in place will be able to fulfil its functions and, in particular, assure and satisfy the IAEA that it can safely proceed with new treaty arrangements with the UK?
Dr Golshan: Yes is the short answer. We do not have to have a regime equivalent to Euratom in order to be able to proceed with concluding those agreements and negotiations, so what the IAEA needs the UK to have in place is a domestic safeguards regime that meets its international obligations under the non-proliferation treaty and others. So although there are risks here for us to complete the work we are doing, I think it is a much more achievable objective for us to aim for, rather than replicating Euratom in the first instance. I should again emphasise that having a regime that is equivalent to Euratom is not a prerequisite to complete those agreements and negotiations.
Trudy Harrison
Q
Dr Golshan: The Bill is an enabling Bill. It gives us the broad powers in parallel with nuclear safety and security. It gives the Secretary of State the powers to make nuclear safeguards regulations. That is the secondary legislation that I referred to. In relation to what is possible at our nuclear sites—
Andrew Lewer (Northampton South) (Con)
Q
Dr Golshan: Numerous examples—a Canadian regulator, the US regulator, the Swiss regulator, and even though Finland is out of the European Union and part of the Euratom treaty, given that safeguarding is the responsibility of state, the Finnish regulator sees itself as being responsible for providing assurance to the state in that regard.
Dr Whitehead
Q
Dr Golshan: I think that is probably a question better answered by our legal colleagues, but that aside, I am aware that the Euratom treaty provides for associate memberships, either as a whole or in particular aspects, and that article 206 of the treaty in particular facilitates that. However, I am not an expert on that and I think it would be inappropriate to comment as to whether an association membership is possible or on how it would be possible.
Dr Whitehead
Q
Dr Golshan: I think that is primarily probably a question for those individuals, and more broadly for the Government, to negotiate with Euratom. As far as I understand it, however, the number of these inspectors is no more than a handful and we will need significantly more than that, as I explained earlier. It is a matter of choice for them. If they wish to join the regulator—ONR—then I am sure that we will be more than happy to absorb them.
The Chair
Unless there are further questions from colleagues, I thank you very much, Dr Golshan, for your excellent and most interesting information, and indeed for expressing it in such careful, precise and brief terms, which gives us an extra five or 10 minutes for the following panel. So thank you very much indeed for coming.
Dr Golshan: It was a pleasure to be here. Thank you.
Examination of Witnesses
Tom Greatrex, Jonathan Leech and Rupert Cowan gave evidence.
Trudy Harrison
Q
Rupert Cowan: Correct, and nothing that we are saying suggests that this Bill should not go forward, save for the amendment we suggested, which would make those negotiations more straightforward.
Dr Whitehead
Q
Jonathan Leech: May I first go back to the point about the Bill being a contingency? It is very important that the Bill is no sense a contingency.
The Chair
Perhaps you could speak up a little. We are having slight difficulty hearing you.
Jonathan Leech: The Bill is in no sense a contingency, unless we get into a position where we simply do not need our own domestic safeguards regime. Otherwise, it is necessary—it is essential. We have to have it, and we have to have it now. We need the secondary legislation on the table as soon as possible, if not now, and then we need the resource within ONR that we heard about earlier. Critically, it is not just that we need all that in place at the end of the two-year period; we also need to be able to demonstrate that to all those we seek to negotiate replacement nuclear co-operation agreements with, so that we can also have those agreements in place seamlessly at the end of the two-year period.
There is another point to clarify in relation to the role of the IAEA. We are not negotiating nuclear co-operation agreements with the IAEA; we have to negotiate with them on the voluntary offer agreement. Those negotiations are progressing, but I suspect that they are not negotiations that will be critical from a time perspective; it will be the negotiations of the nuclear co-operation agreements, and there we are at the mercy of political will in any number of counterpart states. That is where it becomes extremely uncertain as to whether it is even possible to have those things in place within that timescale. Certainly, to stand any chance of that, we should be in a position today to say, “These are our proposed regulations, this is our resource, this is where we are with IAEA. Can we start talking to you seriously about an NCA?” It is not enough to be able to say, “This is our enabling legislation.” We need to be a long way ahead of this if we are going to have any chance of meeting that two-year timescale.
Dr Whitehead
Q
Tom Greatrex: It could do. You heard from the ONR earlier about the attractiveness of having a period of parallel working. That is in relation to the safeguarding activity and carrying out that function. It is a similar position with relation to co-operation agreements which currently exist under the Euratom umbrella. So the nuclear co-operation agreement we currently have with the US is as a member of Euratom. We will need to have a bilaterally negotiated nuclear co-operation agreement in the future, because it is a legislative requirement in the US and I am sure you will hear from others in evidence about why that is so critically important to particular power stations and projects. Enabling there to be a position where you are covered by the Euratom nuclear co-operation agreement while a bilateral nuclear co-operation agreement is finalised, agreed and put in place is exactly the kind of transitional arrangement or contingency or parallel working—whichever choice of words you want to use for broadly the same thing—is something that the industry has said is very desirable. You have also heard from the ONR that this will help them in the work they will be tasked to do as a result of the provisions of this Bill.
Jonathan Leech: May I add a thought on the concept of associate membership and the extent to which we can rely on that? Of course, the nuclear co-operation agreements we are talking about are agreements with Euratom for the benefit of Euratom members, who are fully subscribed to all the obligations and commitments that entails, including acceptance of all Euratom regulation, including acceptance of European Court of Justice jurisdiction. When we come to look at the transitional phase, we should certainly not assume that all counterparts of those co-operation agreements with Euratom would accept that they should somehow continue to apply to the UK if the UK is something other than a fully subscribed Euratom member. So when we talk about associate membership or a third state of some sort and other examples around, that we can see where others have relationships with Euratom, that in itself would not solve the immediate need to ensure that we have the co-operation agreements in place that we need.
Dr Whitehead
Q
Secondly, we might move down the line of a transitional arrangement, in order to get to the position—not at a more leisurely pace, but at a rather more possible pace —of possible complete rupture with Euratom, but in circumstances in which we might have got NCAs in place in a reasonably orderly way. What, in your view, are the realistic prospects of going down one or other of those routes in the sort of time that we have in front of us?
The Chair
Again, we need a brief answer, because we are drifting slightly wide of the terms of the Bill. We have plenty of time, but even so.
Rupert Cowan: Let me bring it within the terms of the Bill, to make you feel happy, Mr Gray. Obviously the Bill enables those discussions, as has been described, but the chances of being able to follow either of those routes successfully before March 2018 are zero. The possibility of associate membership is not zero but that possibility, having been fulfilled if counterparties are willing to allow it, would not allow us either the opportunity or the time to negotiate the necessary co-operation agreements with the important counterparty jurisdictions that we need.
The second alternative that you suggest is of maintaining full membership for a period, so maybe it could be extended by two years with a sudden cut-off being agreed, and being able during that two-year extension to renegotiate NCAs. That is probably the most practical and preferable solution, but whether or not members of Euratom would be prepared to allow the UK to do that is a very different question.
Unfortunately, it is inevitable that we will be faced with discussions about renegotiating our NCAs with key counterparties who are neither motivated to agree quickly nor able to, because of their own international obligations of recognising the adequacy of our safeguarding arrangements, and there will be a point at which they cease to apply under Euratom, with consequences that remain to be seen.
I mean, I cannot imagine the United States immediately withdrawing its expertise from the various sites, but it may choose to. Similarly, Korea is a very important counterparty. Once the agreement comes to an end, the opportunity of persuading Korea to invest in Moorside goes away from us.
Mary Robinson
Q
Rupert Cowan: In terms of research, which is a separate issue, it is fundamental. All the joint research—the Joint European Torus and so forth—is predicated on membership of Euratom, and the funding arrangements are a subset of the arrangements of the Euratom members. At the moment, it will stop, and unless central Government funding is made available people will return home.
Dr Whitehead
Q
Rupert Cowan: Well, it is the article 50 notice. [Interruption.] Did I say 2018? I meant 2019—apologies.
Dr Whitehead
Okay. Assuming we did mean 2019, if we are not in a position—even if we are reasonably close to a position—where we have done all the secondary legislation arrangements for nuclear safeguarding, but we have not made too much progress in a number of other areas relating to transposing Euratom responsibilities to the UK, and/or a number of those NCAs are in a difficult position as far as their conclusion is concerned, what would be the effect on the nuclear industry at that point?
Rupert Cowan: It is very difficult to project, but it does mean that, unlike other industries, trade has to stop—trade in materials, in intellectual property and in people, as in intellectual property. For example, you can imagine that the French, if they were in a bad mood, might choose to drag their feet, because in consequence they would be able to take a monopoly of fuel retreatment from Japan, which currently sends some to the UK and some to France. Who is to know that that will not happen? The European Union will not see us as friends and will not seek to bend over backwards to find accommodation for a nuclear co-operation agreement. It is probably going to be a very slow and difficult arrangement.
One thing that needs to be in place to achieve any progress is a safeguards arrangement that is at least as good as Euratom’s. Currently, the Bill as drafted insinuates that there is a window for it to be less than Euratom, because it goes to IAEA rather than Euratom guidance. Hence the words that we are offering for someone to propose as an amendment, so that in those negotiations you can say, hand on heart, that there will be no dilution, and therefore no commercial advantage to the UK, as a result of our having a domestic safeguards arrangement rather than a Euratom safeguards arrangement.
Tom Greatrex: Let me add that if, as has been stated, the Government’s intention is to replicate the Euratom standards and arrangements, you will have heard from the ONR earlier that it will not be possible to implement that at the end of March 2019. That is the crux of the industry’s concern about there being sufficient time to enable the new UK regime to be in place. The Bill does just the very first part of enabling that to start to happen. It does not solve the issue; there are a whole range of things that have to happen as a consequence of the Bill and other remits that need to be struck, which is why people are concerned about a very real-time pressure.
Jonathan Leech: The very first step would be to make absolutely certain that the Bill gives the power to create the regulatory regime that is equivalent to Euratom. The second step, which needs to follow that very closely, is to ensure, by whatever means necessary, that ONR is given the resource to do what needs to be done, so that we do not face any hiatus, if indeed that is possible.
Rupert Cowan: In the safeguards regime.
Jonathan Leech: Yes, in the safeguards regime.
Rupert Cowan: Which then allows the discussions to go forward from a position of fairness and honesty; that we are not trying to dilute or change the obligations we have under Euratom, which is what others might suspect.
Jonathan Leech: When you have both of those things, you can go and speak to counterparties to the co-operation agreements you need and say, “This is what we are doing. We can lay it out on the table for you. This is the investment we are making and these are the regulations we will have in place.” If we cannot do that, they simply will not take us seriously.
Dr Whitehead
Q
Jonathan Leech: As a matter of general political process, yes, there needs to be scrutiny so that these regulations are developed now—not over the next two years, but over the next month—so that we are then in a position to take the steps that follow. In terms of the broader position, if what we are seeking to do is to replicate and preserve what is, at the moment, effectively EU regulation, then that is but one of many areas where a similar approach may be taken. It is a little more complex here because you have to untangle it from the resource of Euratom and the enforcement processes and the ECJ jurisdiction. Nevertheless, if the statement is that it is to replicate, then the objective should be just that.
In terms of the fine detail of the regulation, it is an intensely technical thing, and some sort of secondary legislation is probably the right place for it. My biggest concern would be around scrutiny of the timetable to ensure that it is not delayed in any way that will jeopardise our position at the end of the two-year process.
Tom Greatrex: I would have thought that, as Members of Parliament, you would want to be satisfied and confident that everything is in place in the timeframe in which it needs to be in place. It is obviously open to you to seek to amend the Bill in order to put that to the test.
A subsequent related point is that the industry also thinks that it is important that the Bill could be amended to ensure that the nuclear sector is consulted on the detail of that new regulation. You have to bear in mind that there will be people who will need to make sure that they can comply with that regulation, so understanding its content is vital. Getting that right—given the timeframe and the time pressures we face—is going to be critical. So there is another route to pursue to ensure not only that Parliament is satisfied, but that the industry has an opportunity to be consulted on the detail of that new regulation so that it is right first time.
Jonathan Leech: In a sense what is needed is the highest degree of openness and the widest consultation possible in the development of that regulation.
Dr Whitehead
Q
Rupert Cowan: Completely seriously. The reason for that is that each of the counterparties with whom we trade in fissile material, components, or anything else listed as sensitive and nuclear, have their own international treaty obligations. One of those obligations is that they should not trade with people who do not have safeguard arrangements in place that are at least equal to the IAEA safeguards. Unless that is complete and in place, we will not trade, and so they will not be able to continue business with us—full stop. If any members will be participating tomorrow in the Business, Energy and Industrial Strategy Committee on the economic implications for the industry, that is what will be said to you.
The Chair
I am being fairly relaxed, but I want to bring it back to what is in the Bill, rather than what is not. With that in mind, I call Dr Whitehead.
Dr Whitehead
Q
Jonathan Leech: You are right into the detail of the technical regulation there. The first thing is that you need to expand the scope of those powers within the legislation, and the Bill seeks to do that. Then you need the regulation to set out exactly what is to be done, how and where, and take into account the point, which we have not really gone into, about the outcomes-based approach that the rest of our domestic nuclear regulation is based on. That will present a challenge in transcribing the regulations for use in UK law. We are probably straying from the Bill there. However, provided that we set out in the Bill an expansion of those enforcement powers, which will be an essential component of the expansion of ONR’s role, we are starting to put in place what we need to have. We need the regulation to go with it.
Dr Whitehead
Q
Jonathan Leech: In terms of how it is presented, I suggest that it is preferable to have our law on this matter collected together in one place and so to proceed by amendment, rather than by replication. If we create a whole new regime in the Bill, then we introduce the possibility of discrepancies between two similar but possibly slightly different regimes, that is generally unhelpful. To proceed by amendment to and expansion of the Energy Act 2013 is probably the right way to go.
Rupert Cowan: I see the people who are negotiating the nuclear co-operation agreements. They want to be able to refer to a clear set of guidelines, which is clearly at least as effective in safeguarding, and therefore allowing the counterparty to fulfil its international obligation, as the existing Euratom system. It needs to be easily referable to, so that you can sell it and get your deal as quickly as possible, without them taking points about the way your safeguards are drafted or presented. That should be very much in the minds of the draftsmen—that there is a commercial and pressing need to get this agreed with seven or eight foreign jurisdictions as quickly as possible, some of whom will be willing, and some of whom will be less willing, to agree your safeguards regime as adequate to fulfil their obligations. It needs to be clear, clean and saleable. That is the secondary legislation that follows from the Bill, which is why we have suggested only one amendment. The objective of the amendment is to do that, so you can go and talk to somebody in Korea or the United States and say, “This works,” and they cannot see a reason quickly why it should not. You are resourced, the regulations are clear, they apply and you can have your discussion over in months, rather than years.
The Chair
My instinct is that the Committee has found your evidence extremely useful. Unless there are any further questions, I thank you all for your extremely helpful, useful, well-informed and wide-ranging evidence. We are most grateful to you.
Ordered, That further consideration be now adjourned. —(Rebecca Harris.)
Smart Meters Bill
Alan Whitehead ExcerptsTuesday 24th October 2017
(7 years ago)
Commons ChamberRead Full debate Smart Meters Act 2018 View all Smart Meters Act 2018 Debates Read Hansard Text Read Debate Ministerial Extracts
Dr Alan Whitehead (Southampton, Test) (Lab)
We have had a very good debate this afternoon, with informed and engaged contributions from hon. Members on both sides of the House on a wide range of issues relating to smart meter roll-out and, in some instances, going a little beyond that. However, the contributions have all been relevant to a debate about a Bill with some very specific and relatively narrow elements.
Two of the clauses are very specific. One relates to the extension of the termination period during which the Secretary of State has powers over activities connected to smart meters from an end date in 2018 to an end date in 2023. The second addresses the lack in legislation of a smart meter communication and licensing administration regime by establishing one.
If we look very narrowly at the Bill, we might ask two important questions: why did the Government decide in 2014 that there should be a 2018 termination date for Government control over the smart meter roll-out, and why is that date now being extended to 2023? Is it being extended because, as hon. Members have said, the Government do not think the smart meter roll-out will in fact be completed in 2020, or are there other reasons for the extension? We might ask why, if there is a real risk of the roll-out being delayed by the Government’s inability hitherto to wrestle the operation of the DCC from possible paralysis—should it, or presumably the company to which it has been outsourced and of which it is now a wholly owned subsidiary, go bust, or should payments not come in to that company—these operations have apparently been conducted with no such safeguard written into legislation for almost four years since the establishment of the DCC in 2014.
Both questions, unless they have particularly good answers attached to them, demonstrate a certain, shall we say, laxity in the Government’s approach to the oversight of the roll-out of smart meters, and might prompt further questions: what else is possibly in the woodwork that may be impeding the progress of the smart meter roll-out to a successful conclusion, and are there further things we might do to ensure that the process works well in moving towards that goal?
Hon. Members have raised a number of those possible issues this afternoon. In an intervention, my hon. Friend the Member for Chesterfield (Toby Perkins) talked about dumb meters being replaced by smart meters and about what would happen to them. The hon. Member for Eddisbury (Antoinette Sandbach), in a very thoughtful contribution, raised the issue of what we should do about energy efficiency in conjunction with smart meters, and talked about how those two issues might go hand in hand. My right hon. Friend the Member for Doncaster North—
Dr Whitehead
I am very sorry—it’s Don Valley now, isn’t it?
My right hon. Friend talked about the continuing imbalance of benefit in the roll-out of smart meters, with the benefit appearing to be accruing to energy companies, as opposed to customers. For our part, we support the idea of introducing smart meters across the country to replace the dumb meter system that serves the customer very badly and has historically done so, and is certainly not fit for purpose for the requirements of the different ways of supplying, using and measuring power that are coming our way with the energy revolution that is upon us.
The gain not only to customers but to our energy systems as a whole of having collectively installed, sufficient smart meters across the country to bring in new ways of measuring and predicting use of associating smart meters with smarter grids, thereby saving enormous amounts of further future expenditure in grid strengthening and capacity additions—all to the benefit of a smarter, more resilient, more efficient energy system for the future—suggests that supporting smart meters is right thing to do.
But then we come to the process by which smart meters are rolled out, and there is much to raise an eyebrow about. First, there is the Government’s original choice of who should undertake the roll-out—the energy companies: a model not adopted by any other country managing a smart meter roll-out programme, as my right hon. Friend the Member for Don Valley (Caroline Flint) pointed out. Secondly, there is, as a number of hon. Members have mentioned, the high overall costs built into the roll-out—costs that will eventually land on consumers in the shape of bills on their doormats. Thirdly, there is the truly lamentable performance so far in getting the DCC—the communications company responsible for making smart meters communicate well and on an interoperable basis—up and running so that smart meters, once installed, really can communicate with other and with the system. That communications company has now only just gone live, at the very end of the window for doing so before serious repercussions arise. Fourthly, there was the decision, halfway through the roll-out, to transition from one type of smart meter to another—a process akin to trying to change the wheel of a car while it is driving along the road.
All these issues raise legitimate and far-reaching questions about whether the goal of having a critical mass of smart meters in place by the end of 2020 is likely to be achieved and whether, in the short time available to us, moves can be made to get us back to that goal. The recent reports in the 2016 impact assessment suggest that we are not doing very well on installation—that we are set for an almighty bunching of installations in late 2018 and 2019 that is very daunting, even if vans of installers are not starved of meters to put up because they have been told not to install the old ones and are awaiting supplies of the new ones to install. I welcome the consultation on methods of resolving the possible hiatus in supply during the changeover from SMETS 1 to SMETS 2 meters. However, I am minded—I think the Government will have some difficult decisions to make in this regard—of what we need to do by 2020 in populating the country with smart meters to the extent that we can really make these changes possible, for our collective good, given the sheer number of smart meters that have been installed across the country.
We need to judge the very modest changes to the smart meter roll-out regime in this Bill against that wider background of decisions and progress made in the roll-out itself, and of how far away we are from the goal of having a national smart meter presence that makes all the other energy innovations—and cheaper energy and gas—possible, and to decide whether we should take the opportunity to add further elements of “getting on with it” into the Bill as it progresses through Committee.
We will not oppose this Bill on Second Reading. However, I place the Minister and the Government on notice that in Committee we will closely scrutinise the roll-out provisions currently in place to look at ways in which we can make amends for some of the frankly sloppy decision making that has occurred in the progress of the roll-out, and stiffen the sinews of the programme so that it works as well as it can. It is perhaps no coincidence that the—
Greg Clark
Will the hon. Gentleman confirm that the programme motion is generous in providing time for consideration of the Bill?
Dr Whitehead
The last time I heard about the progress of the programme motion, there was no agreement on the number of days that could be set out for the Committee stage, so it may well be the case that that concern will be reflected tonight. However, I would emphasise that as far as the main purpose of the Bill—
Simon Hoare (North Dorset) (Con)
As I understand it, there are six days in the programme motion—[Interruption.] Forgive me; there are eight days in the programme motion for a Bill on which the Labour party will not divide the House. It seems bizarre to divide the House on the programme motion.
Dr Whitehead
I repeat that according to my latest information, the discussions about what should be in the programme have not concluded. That may be reflected in what we do tonight.
I have with me plastic models of Leccy and Gaz, the characters from the advertisements for the smart meter roll-out. Hon. Members can see that as far as Leccy is concerned, the model does not stand up; perhaps that is no coincidence. We want the process to stand up as well as it can, and we will work hard to ensure that it does.
Draft Electricity Capacity (Amendment) Regulations 2017
Alan Whitehead Excerpts(7 years, 1 month ago)
General CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Richard Harrington
I believe that is extremely unlikely, but we all have our views on that subject; certainly, if this measure is voted down today, I am sure the Prime Minister will have no choice. In all seriousness, the hon. Gentleman makes a valid point, but if it were left only to the shorter, one-year cycle, I cannot see people taking the kind of investment decisions needed. Of course, it is arguable—some might say they want 10 years. When the rest of the electricity supply market—not the capacity market but the normal supply market—starts to build huge wind turbine farms and gets planning permission to build nuclear power stations and all those other things, those are all judged on 20 to 30-year cycles, so it is difficult.
The officials think that four years and one year are right, but it is always up for review, and if the market changed completely we would want the flexibility to be able to act. For the moment, it works. It sounds arrogant for Government to say it, but I think most people think the capacity market is working. Self-evidently, it is working.
Richard Harrington
I notice with fear and trepidation the shadow Minister shaking his head. I will try to make some progress, then keep quiet while he makes his comments, and then I will do my best to counter them.
The capacity market is working and there is fierce competition. We have the required capacity at prices significantly lower than many detractors of the scheme expected. I hope the shadow Minister agrees that it is working from a competitive point of view. As the hon. Member for Huddersfield said, that is good for consumers because it has translated to lower costs on bills. Whatever one’s view of bills generally, this is not a big chunk of bills.
The capacity market is driving investment in new and flexible capacity. The most recent four-years-ahead auction secured more than 3.4 GW of new build generating capacity, including combined-cycle gas turbines, open-cycle gas turbines, small flexible engines and battery storage, as well as 1.4 GW of demand-side response. The clear message from industry and investors is that the mechanism retains their confidence and is the best available approach for ensuring our long-term security of supply.
Industry and investors stress that regulatory stability is crucial, but also that the scheme, which is operating in a rapidly changing environment, must be reviewed regularly to ensure it remains fit for purpose. That goes back to the four year, one year point. The changes set out in the instrument are the latest in a series of amendments that ensure the scheme is kept relevant and workable. If the Committee bears with me, I will briefly expand on the amendments made by the draft regulations.
First, the instrument amends the method by which the costs of the capacity market are recouped from suppliers. It was felt that the current supplier charge arrangements potentially gave an unfair advantage to embedded generators—the smaller generators connected to the lower voltage distribution network—and could distort the outcome of the capacity auctions. I had better explain what that means. That arises because, under the current arrangements, suppliers are charged according to their share of demand at peak times, measured by the demand they place on the transmission grid. That is called the net demand.
By contracting with embedded generators to run over winter peaks, some suppliers are able to reduce their net demand and therefore their share of capacity market costs, which means others have to pay more. With some of the savings inevitably being passed on to the embedded generators, such arrangements unintentionally risk giving them a double payment for what is essentially only one contribution to security of supply. Nobody is operating illegally, but it is basically a loophole that needs shutting off. As my great hero Basil Fawlty said in another context,
“that particular avenue of pleasure has been closed off.”
We need to shut that off.
The instrument addresses the issue by amending the basis of the capacity market supplier charge and settlement cost levy from net to gross demand. That is a fairer way of sharing costs between suppliers. It ensures that suppliers’ costs reflect their overall demand and helps to ensure a level playing field between different generators in the auction. That is the first of what I hope are non-contentious amendments—although, looking at my shadow, perhaps that is a victory of hope over logic.
Secondly—I will be as quick I can—the instrument seeks to prevent new and refurbishing plants from being overcompensated within the capacity market when they are also in receipt of aid through risk finance schemes such as the enterprise investment scheme, the seed enterprise investment scheme and venture capital trusts. We do not want to have a double subsidy, whereby plants can get this payment and tax breaks as well, because that would distort the outcome of capacity auctions.
To ensure fair competition and value for money for consumers, the regulations assert that where a capacity provider has accessed investment through one of these risk finance schemes to provide or help to fund their capital expenditure, their capacity payments must be reduced until that has been offset. They can switch systems, but only after they have used up the original tax breaks. These offsetting arrangements ensure that the total amount of aid is capped at the amount awarded in the capacity market auction.
Thirdly, the regulations will remove an inconsistency between how demand-side response capacity and other capacity types are de-rated. For hon. Members who are less familiar with de-rating than we are in the Department, I should explain that it is the process by which the volume of a provider’s capacity is adjusted to reflect the reliability of the technologies being used. Unlike other participants, demand-side response providers can nominate a lower amount of capacity to bid in an auction than the capacity that they estimated at the pre-qualification stage, but that nominated amount is not currently subject to de-rating. The regulations will address that inconsistency by ensuring that the nominated value is de-rated, thus improving the overall reliability of the capacity procured and enabling us to know more exactly what we are getting. Again, it is about closing a loophole.
Fourthly, the regulations clarify the requirement for capacity market participants to maintain credit cover until they have fully discharged all the requirements against which it has been lodged. Additionally, they put it beyond doubt that a party’s credit cover will not be drawn down where a termination fee is due, unless the termination fee is unpaid.
Finally, the regulations will amend the name, though not the substance, of the capacity market warning—the statutory notification that has to be issued under the scheme in specific circumstances. We believe that “capacity market notice” will better reflect the nature of the notification and be clearer for all participants.
My Department published two consultations on our proposals in September and October 2016 and received 38 responses. Significant support was expressed for the majority of the proposals. I look forward to hearing what hon. Members have to say about them.
Dr Alan Whitehead
It is a pleasure to serve under your chairmanship, Mr Davies. I am afraid the feeling may not be reciprocated this morning because of my habit of turning up for Committee sittings 10 seconds before they start. I vow to turn over a new leaf and turn up earlier in future.
My support for the capacity market, as the Minister may have gathered from my non-verbal intervention to his speech, is lukewarm at most. I agree that it has been successful in securing a capacity margin over time, but its overall achievements have come at an enormous cost to the public and its results bear little relation to what was originally intended. I will spend a minute or two reflecting on the overall unsuccessfulness of the design, as opposed to the operation, of the capacity market in securing a capacity margin for the country.
The Minister has helped the Committee greatly this morning by setting out how the capacity market works and what it is about. It is a device that is supposed to secure capacity and to procure the long-term building of additional capacity by holding regular auctions. It is supposed not only to provide power on a one-year basis, as the majority of the auctions have concentrated on, but to receive competitive bids to supply power on a long-term basis. That entails building new plants and receiving not a one-year capacity contract, but a 15-year contract.
As far as the capacity market is concerned, bids can come either from existing suppliers for one-year contracts in order for them to continue to exist, or for 15-year contracts to build new power stations and for those power stations, once built, to exist. Hon. Members need to be clear that the capacity market does not procure any energy as such. All it does is ensure that the plants which might supply energy will be in place to do so when they are called upon. Those power stations then get the market rate, whatever it is at the time, for actually supplying the power. They are rewarded doubly through the capacity market. First, they are rewarded for existing. Secondly, they are rewarded when they supply power in the normal way when they are asked to do so. The capacity market is essentially a device that secures the continued existence of power stations, or the possible existence of new power stations. It is nothing to do with the actual supply of power.
The Department has now held a number of auctions along those lines and has spent to date—I say this very slowly—£4.8 billion. That money comes from consumers. As is reflected in the report today, the devices by which that money comes from the supplier, and thus from consumers, are set out in the explanatory notes and in some of the passages in the SI itself, but £4.8 billion has gone to power generators.
One of the aims, as I mentioned, has been to secure the development of new gas CCGT plants in order to secure a long-term capacity for those plants. Hon. Members will know that a number of gas power stations are closing in the near future and a number have been mothballed. Perhaps the idea of procuring new gas power stations to replace those is not so bad in theory, but in practice, after £4.8 billion has been spent, no significant new plants have been procured. Actually, that is not quite true: one plant was secured in the initial auction, but it was not built and has now been cancelled, and a small CCGT plant—I think at King’s Lynn—has been secured, but otherwise no significant large CCGT plants have been secured.
It is true, as the Minister says, that some other plants have been procured—small open-cycle plants from reciprocating engines. Some of those reciprocating engines are unfortunately diesel engines, which from a public policy point of view might be the worst idea in terms of securing new power capacity. Those are very small in individual capacity and collectively they do not add up to more than what would have been the output of about one new CCGT plant.
As far as one-year contracts are concerned, two thirds of what has been procured has been for the continuation in existence of fossil fuel plants, including, for example, coal plants, which are supposed to be phased out by 2025. Arguably, the capacity market has led to the continued operation of coal plants that otherwise would have closed down already.
Even among non-fossil fuels, in the December auction for example, the largest sum went to—I am not making this up—procuring the continued agreement of nuclear power stations to generate, to the tune of £177 million, when we know that it is not possible for nuclear power stations to switch off and not generate. We have thus very smartly procured a commitment to supply from the sector of the market that is unable to not supply; nuclear plants receive £177 million for the privilege of continuing to supply and not to switch off. From that point of view, the capacity market has not been a conspicuous success; put another way, it has arguably been a monumental waste of money, which eventually finds its way to customers’ bills, as shown in the mechanisms outlined in the SI.
It is not as though capacity markets were the only show in town. They were invented during the energy market reform process, hence the Electricity Capacity Regulations 2014, the starting point of capacity markets’ operation. The Minister has outlined how the SI seeks to make a number of mostly minor amendments to those regulations, which he described as “tweaks”. I agree that they are tweaks; with regard to the market working in its own right, they are perfectly sensible and reasonable and we should have no concern about them, with one caveat.
A significant impact assessment, published by the Government while considering the establishment of the capacity market, looked at it against the main possible alternative: a strategic reserve whereby capacity is reserved outside the market, for example from power stations already mothballed, and is released should there be a strain on the main market leading to very high prices per half hour of power. At the time, that was assessed as far cheaper for the public to underwrite, but for complex reasons it was not advanced instead of the capacity market, even though the impact assessment showed that the change in net welfare for the strategic reserve was twice as good as for the capacity market.
The strategic reserve has been my personal preference all along. I think even now it would be possible to establish a strategic reserve to ensure capacity margins and to discontinue the capacity market. From the explanatory notes alongside this SI, however, I see that the capacity market is now supposed to last for 10 years, with a review of its operation five years after its introduction, which I take to be 2014. We currently have a capacity market; it is prudent to look at its detailed workings and amend them to obtain better results if possible, which is essentially what these measures do. To that extent, with one caveat, I am happy to see them proceed and will not seek to divide the Committee.
My caveat is a measure in schedule 2 to the regulations, which, as the Minister has outlined, seeks to change the formula for securing a measure of payment from suppliers to underwrite the capacity market. The payment required is based on a supply share of total demand at peak times over the winter, and is based on power through the transmission grid. The suggestion is that some suppliers reduce their liability by sourcing some of their supply from embedded generators connected not to the transmission grid but to the distributed grid. In theory, they might gain a market advantage by, in effect, being paid twice: once through the indirect benefit to them from their dealings with the supplier, and once through their own activity.
As the explanatory note sets out, the theory is:
“It is expected that suppliers will pass on most of this saving to the embedded generator.”
It is by no means clear that that actually happens; if it does not, through the envisaged change from charging net supply to charging gross supply, the embedded generator loses rather than gains through the process. I would be grateful for the Minister’s thoughts on the process set out in schedule 2, and to know whether he is clear that it does set out the benefits he has described to us. I would ideally be grateful for an indication that he will have a further look at this section, to see whether further amendments might be made to the payments regime, reflecting better solutions that have been identified to the problem he quite rightly outlines.
Finally, returning to my initial point about the overall failure of the capacity market to do what it was intended to do, and the enormous cost incurred in the process, I would have thought it would be prudent to bring forward the review set out in the explanatory notes from five years after the beginning of the capacity market in operation to four years. If the review happened next year, we could see whether the capacity market has been working in the way it was intended and whether there may be better alternatives to the capacity market to secure capacity in the future.
The Minister and I agree that this is a fundamental part of the process we need to get right over the next year as we continue to deal with close capacity margins. We need to ensure that the lights stay on. I will be interested to hear from the Minister whether he is considering doing that review. If he is not, will he consider that in the not too distant future?
Richard Harrington
I am extremely grateful to the shadow Minister for his speech. He has provided food for thought on a lot of points. I thank him for his support for most of these technical tweaks or arrangements. I greatly appreciate it.
I have listened carefully to the hon. Gentleman’s views on the capacity market. You, Mr Davies, and others may get rather impatient if I go into great detail about the market itself, but I am happy to meet the hon. Member for Southampton, Test—I think I am seeing him on Monday anyway—to talk about it in the detail it deserves, rather than occupying the Committee now. If it is acceptable, I will stick to talking about the technical arrangements themselves.
The hon. Gentleman raised some specific issues that I should mention to get them on the record, if Members will bear with me. I did not actually mention the 15-year agreement in my opening remarks, but what he said was correct. The capacity market selects plant at auction simply by price. It is a safe assumption that an existing plant, because it has probably written off its investment, will be cheaper than a new plant, which faces significant up-front investment costs.
Some of the nuclear plants that the hon. Gentleman referred to are near the end of their life. They could be turned off, and in fact that was the intention with many of them, subject to the great safety requirements necessary. The operator, EDF, is extending the life of those plants, but for a short period. He is right about turn-on and turn-off—it cannot be done instantly—but the plants can be kept going within a safe limit for comparatively short periods, compared with their full life.
The majority of resources are able to access only one-year agreements. An exception was made for new and refurbished plant because investors required more certainty to invest in large capital projects. Where not necessary, longer-term agreements risk needlessly locking consumers into paying a long-term price. That goes against the valid point that was made about things moving quickly in the energy market. What seems like a good deal in year one could seem absolutely ridiculous in four years. The Government, as usual, have to try to strike a balance. The hon. Gentleman may feel and is perfectly entitled to feel that the balance has not been struck properly, and I look forward to discussing that with him.
The capacity market is technology-neutral. The types of energy or technology are not decided in advance, because all types are eligible to participate. That is correct, and it includes coal and other fossil fuels. Broadly, those get Government subsidies in the same way so as to comply with state aid rules. Value for money is very important for energy. For those less familiar with the energy market, there are other auctions, such as contracts for difference and other systems. We could discuss those at length. Members will be delighted to hear that I will not do that now, but those systems take care of the point that the hon. Gentleman raised.
Should we pay to keep new and existing plant going through the capacity market? The Government think there are good reasons to do so, but there are arguments to the contrary. I fully accept the hon. Gentleman’s point that the Government have a popular policy—popular in most parts of the country—of removing fossil fuels as soon as possible. We are doing that, as hon. Members know, but it does means that there might be some fossil fuel use in the short term, because fossil fuels can be turned on and off quite easily. I suppose that gas is the easiest to turn on and off, with coal just behind, but that is nothing to do with the Government’s strategy, which we are sticking to, of removing fossil fuels in the next few years. It is a well publicised strategy, and the owners of the power stations know about it and are on track for it.
Rather than going into more detail now, I would love to debate the more technical points that the hon. Gentleman has made with him later. Having worn the patience of the Committee significantly by going into more detail than some Members on both sides might have wanted, I am happy to speak to anybody individually. Obviously, I have regular meetings with the shadow Minister and the Scottish nationalist party spokesman, the hon. Member for Inverness, Nairn, Badenoch and Strathspey, and if they would like me to put this matter at the top of the agenda, I will happily do so, in a meeting with officials if they would prefer to go into those details.
Dr Whitehead
Before the Minister resumes his seat, would he say for the record whether a further view will be taken on the question of embedded generation and gross payments and, secondly, whether the review of the capacity market might be expedited over the coming period?
Richard Harrington
I listened carefully to the hon. Gentleman’s points on that subject. He asked me to give some thought to those options before we decided that we were not going to pursue them. I am giving thought to them both, and I look forward to discussing them with him.
Question put and agreed to.
Resolved,
That the Committee has considered the draft Electricity Capacity (Amendment) Regulations 2017.