Crown Estate Bill [HL]

Debate between Baroness Smith of Llanfaes and Lord Roborough

Committee stage
Tuesday 22nd October 2024 Lords Chamber

[Lord Roborough (Con)]

My Lords, I will speak also to Amendments 39 and 40 in my name.

These amendments concern the publication of a framework document and the partnership agreement and memorandum of understanding between Great British Energy and the Crown Estate. We must have the opportunity to see, and vote on, the framework document before the Bill can be passed. Amendment 38 prevents the Crown Estate Bill coming into force until two months after the framework document has been laid before Parliament and has been subject to a vote. Amendments 39 and 40 in my name similarly seek to ensure the partnership agreement and memorandum of understanding between Great British Energy and the Crown Estate is laid before Parliament before the Bill is passed.

It would be negligent to pass a Bill without consideration of such integral documents. We must see the framework document and partnership agreement with Great British Energy before we can accept this legislation and I express my deepest concern over the absence of these documents to date. We must scrutinise the framework document to understand and be confident that it is appropriate for the Bill. Currently, the details on the Crown Estate’s partnership with Great British Energy are similarly limited. As I propose with the framework agreement, we must also have sight of the partnership agreement and memorandum of understanding between Great British Energy and the Crown Estate and Amendments 39 and 40 demand that this will be laid before Parliament before the Bill is passed.

This is a major and unprecedented partnership. The Crown Estate estimated that it will result in up to 30 gigawatts of new offshore wind developments reaching seabed lease stage by 2030. Considering this, we must be given the opportunity to read, review and scrutinise the partnership agreement and memorandum of understanding between the Crown Estate and Great British Energy before we accept this legislation.

I agree with the sentiment of the noble Baroness, Lady Smith, in her Amendment 41, and the noble Lord, Lord Berkeley, in his Amendment 42. I echo their concerns over the absence of the publication of the fiscal framework with Wales and its lease extension policy.

I hope the Minister will carefully consider the concerns I have raised and will confirm to the House that the framework document and partnership agreement and memorandum of understanding between the Crown Estate and Great British Energy will be published and laid before Parliament before this Bill is passed.

[Baroness Smith of Llanfaes (PC)]

My Lords, Amendment 41 in my name is included in this group of amendments and is supported by my noble friend Lord Wigley. This amendment would require the publication of an agreed fiscal framework between the Treasury and the Crown Estate before commencement of the Act.

During day one of Committee there were strong arguments made in support of the second group of amendments—a number of them seeking to write a fiscal framework. I believe that there is a shared view from around the Chamber that such a framework should have been drafted and published before Second Reading of this Bill. I am therefore grateful that the Minister, in his response to the second group of amendments, committed to publishing the framework before Report. If that is the case, I will not need to push for an amendment of this kind on Report.

However, I will take this opportunity to highlight some concerns regarding the possible content of the fiscal framework. I am concerned by the possibility of no hard cap on borrowing. I am led to believe that the framework will instead impose a loan-to-value ratio of 25%, which, as the Minister has already noted, would currently be around £3 billion and could go beyond that. To put this into perspective, the Welsh Government fiscal framework has a cap of £l billion on capital expenditure, with an annual borrowing limit of £150 million, which it can borrow from the National Loans Fund or a commercial bank. I ask the Minister: would the passing of this Bill as it stands, alongside a fiscal framework of a loan-to-value ratio of 25%, give the Crown Estate more or less borrowing power than the devolved Government of Wales?

I share the view expressed by the noble baroness, Lady Kramer, that the Crown Estate is no “cuddly” organisation. I look forward to hearing the Minister’s response to my question on how the proposed borrowing powers will compare to the current fiscal powers of the devolved Governments, particularly the Welsh Government.