State Aid (Revocations and Amendments) (EU Exit) Regulations 2020

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Wheatcroft

Wednesday 2nd December 2020 Lords Chamber

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, state aid has the potential to distort market competition. As a member of the EU, we were governed by its state aid rules. This SI does away with that, but there is a degree of flexibility to those rules. In 2015, for instance, the Government wanted to subsidise the Drax power station to enable it to convert one of its units from coal to biomass fuel. The European Commission investigated and gave its approval. Clearly there were advantages for all in making that contribution to its own carbon emissions, and the EU state aid rules did not get in the way.

I am grateful to the noble Viscount, Lord Trenchard, for explaining to us how the EU state aid rules have been used so fairly, largely to keep France and Germany in line and to allow the UK to do most of what it wanted. They are not overly unfair. We should not characterise EU state aid rules as necessarily preventing the UK doing what is right. As Theresa May said in Florence in 2017, the UK and EU understand and agree about the purpose of state aid rules and

“trying to beat other countries’ industries by unfairly subsidising one’s own is a serious mistake”.

Some of us fear that the Government are about to make that serious mistake.

That is why I take issue with the noble Baroness, Lady Noakes. The Government can now define their own state aid rules but those have implications far beyond the UK. After all, we are a great trading nation, and everything being said about our future outside the EU is about how we are going to trade brilliantly all around the world. State aid rules that are not approved by those we wish to trade with will make that increasingly difficult. That is why we shall not be able to escape completely from state aid rules. The WTO operates its own and, as the noble Lord, Lord Liddle, pointed out, they are far from adequate, but in every trade deal, as we have heard, state aid will be an issue that has to be agreed on.

So what state aid are the Government so keen to be able to dispense that it stood, in part, in the way of a Brexit deal being negotiated? Perhaps the Minister could tell us what the Government want to do. It seems very strange to see a Conservative Government so apparently keen on being able to dispense state aid. In the past, we have seen plenty of instances where government interventions in industry have been disastrous. It gave us the Austin Allegro, for instance, a car that was not only unattractive but prone to breaking down. That failed to rescue the British car industry; being open to overseas investment was what did that.

Backing winners is not something that we have shown particular acumen in doing, but perhaps that is what the Government have in mind to try again. The partial purchase of the bankrupt satellite company, OneWeb, in the summer seemed to be a move in that direction, but hopes for that business have already begun to fade. At the time of the partial purchase, which civil servants definitely were not comfortable with and had to be mandated to do, OneWeb appeared to be caught in the UK’s efforts to find a replacement for the crucial Galileo project and the GPS system that it fuels. Five months on from that purchase, I am no clearer about how we plan to replace Galileo. I would be grateful if the Minister could tell the House whether he envisages pumping more public money into OneWeb and indeed if he could provide reassurance about how Galileo is to be reproduced in just a matter of weeks.

As the noble Lord, Lord Stevenson, pointed out, we still do not know what state aid policies the Government have in mind. It seems wrong to do away with one policy without explaining what will take its place. I can understand why the EU would be concerned about that, and why it could be standing in the way of a deal. Whatever importance the Government put on being able to dispense state aid as they wish, that cannot be as important as securing a deal with our largest trading partner.

[Baroness Bloomfield of Hinton Waldrist (Con)]

I remind the noble Baroness that the time limit for speeches is five minutes.

[Baroness Wheatcroft (Non-Afl) [V]]

In debate after debate, we hear more stories of the chaos that looms with a no-deal Brexit, particularly on top of Covid, so surely the Government could make clear what state aid regime they favour and whether they no longer believe that British companies are capable of competing fairly on the world stage. Four years after the decision to leave the EU, could the Minister tell us how close the Government are to developing their state aid regime?

Health Protection (Coronavirus, Restrictions) (Obligations of Hospitality Undertakings) (England) Regulations 2020

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Wheatcroft

Friday 9th October 2020 Lords Chamber

[Baroness Wheatcroft (Non-Afl) [V]]

My Lords, the regulations related to hospitality do not make sense. Other noble Lords have pointed out the illogicalities, particularly around dancing. The Minister insists that consultation has driven government thinking. Consultation with the restaurant and pub business would have told the Government that the 10 pm curfew could not be justified. There has been little evidence of scientific reason behind it. Restaurants practising social distancing could survive if they were able to do two sittings at dinner, but the 10 pm curfew makes that impossible.

Publicans have to watch their customers leave and head straight to the supermarket or off-licence to buy more alcohol, which they can then drink outdoors without following any social distancing rules at all. Local authority leaders have pleaded with the Government for changes to this legislation on drink sales but have had no success. The regulations are not being respected because people do not understand government thinking.

Are we really facing an appalling rise in Covid cases, as the scientists say? Even Health Minister Nadine Dorries has warned that our intensive care beds could be overrun within 10 days if the current rate of increase in Covid cases continues. If that is the case, why are we debating these already outdated regulations? We are consistently told that the Government are following the science, but at what distance?

With a virus that spreads in this way, we need immediate action. It will be painful but, without decisive action, the long-term pain will be even greater. If we need more draconian measures, let us have them now, when they might stave off the problem, not when it is too late. The leader of the Opposition, Keir Starmer, wrote this morning that the current dithering is causing confusion.

[Baroness Bloomfield of Hinton Waldrist (Con)]

I ask the noble Baroness to draw her comments to a close because we are very tight on time.