European Research Infrastructure Consortium (Amendment) (EU Exit) Regulations 2018

Debate between Baroness Vere of Norbiton and Lord Stevenson of Balmacara

Wednesday 28th November 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

Follow that. I am happy to agree with the last two speakers, both of whom have brought a lot of sense to this debate, although I think “poorer off” is probably a combination of “worse off” and “poorer”. If the noble Lord, Lord Deben, is intending to repeat that speech during the longer debates that are coming over the horizon, as I hope he will, he might want to get the wording a bit more right because it would have more punch. It is very daring of me to advise a man of such distinction and history in Parliament, particularly in this House. I am a bit old for Lego so I did not quite catch the allusion made by the noble Lord, Lord Fox, but I think the point that he was making is right. We are scratching around here and missing the bigger picture, and both the previous speeches made that point.

I thank the Minister for her letter and for the pre-meeting that we had on this Motion, and I am grateful to her for changing slightly the explanation that she would otherwise have given in order to give a bit more detail. I still think we are a bit short of a couple of issues that I hope she will cover when she responds, and there are a couple of questions that I would like to leave her with at the end. Having said that, I am not going to oppose the Motion; it is a sensible piece of bookkeeping that I hope will never have to be used. The implication is that if there is no deal and we leave on 29 March then this will be implemented. Could she reflect on what happens if there is a deal but no transition period? What is the timing in that situation?

On the particularities, the information that I asked for in the pre-meeting about the process that would be applied if this SI were in place follows up on exactly what the noble Lord, Lord Fox, said. The power to pay money for this, as the Minister said, lies in the 1965 Act. I understand that but what is not clear is the role of UKRI consequent on the Higher Education and Research Act 2017, which is now in force and changes the nature of the relationship between the research councils and the overarching decisions that are being made. As I understand it, research councils still make their own budgets and agree them with the department, but UKRI has an advisory and oversight role and indeed has additional funding if it wishes to do things. Who has the authority to agree to any group in this country going forward to an ERIC? What precisely is the nature of the power that is being taken, who exercises it, and in what way is that different from the current situation? In other words, under the present arrangements, as we are a member of the EU and not a third country, presumably we have a system under which money that is required for creating a new ERIC or joining an ERIC is still in play, maybe still under the 1965 Act. Does that change as a result of this SI?

The subsidiary question, which I am sure the Minister will duck, is this: while there may be no change in terms of regulation, will there be any change in funding opportunities for people if and when we leave the EU and we still wish to participate in these ERICs? The Minister said how many there are; we are a member of a number of them and two are located here. Are there any plans—I have not seen them if there are—for developing this approach? As she said, it seems to bring benefits; it seems to double the money that we can invest in science, and it is good to maintain links with scientists and technologies in other areas because otherwise arrangements for common work would be more difficult.

I turn to the issues that were raised in the other place. The Minister mentioned the CJEU. Like both of the other speakers, I am not sure that I quite follow where we are on this. The CJEU has a role in asserting the overall regulatory framework under which the ERICs operate. However, from both her letter and what she said in introducing the SI, the only power that we would have in the way that is now described—we can debate why she has expressed it this way—is to resign. In other words, if for some reason the rules are going to be adjusted or changed in a way that would imply a necessary change in UK legislation, there is no way in which the CJEU must be allowed to influence British legislation so, if the research party concerned wishes to continue, I take it that its only solution is to resign. That does not seem a very fair or equitable way forward, and I wonder whether the Minister would comment.

That covers one of the points made by the committee in the other place. The other point that it raised was rather more philosophical. The Government’s assertion is that nothing is changing here because we are simply adjusting the rules that would have applied before leaving the EU to a situation to allow it to continue afterwards. The committee said:

“While it can be argued that the policy has not changed, future UK participation as a third country will inevitably mean that the policy functions in a different context”.


Will the Minister comment on whether that is true and, if so, whether there are any implications that we should be aware of?

The regulations before the House deal primarily with research, which is a reserved area. Any change in research funding or research activity has a significant implication for universities, which are of course a devolved matter. Did the Government therefore consult with the devolved Administrations prior to laying this instrument? If so, what was the result? I think there is a reference to letters having been issued but I do not think that involves consultation.

My final point is the regular question about immigration policy. ERICs will allow the UK to engage in science research projects, but the industry has previously mentioned the problem of how the UK’s immigration policies limit its ability to recruit the postgraduate scientists who will necessarily be employed in these areas. In March, 48 science organisations wrote to the Prime Minister claiming that the repeated rejection of skilled workers due to the capping of the tier 2 visas has damaged the UK’s international appeal and will continue to do so. What action have the Government taken since then to try to resolve this very difficult problem?

[Baroness Vere of Norbiton]

My Lords, I thank noble Lords for their very valuable contributions to this debate. I will aim to answer as many questions as I can. There were some impassioned speeches and hard words around the broader picture but when we come back to look at the SI that we are actually considering, to coin a phrase, nothing has changed. This measure is technical in nature. We are not knocking down anything; indeed, we are doing our best to ensure that it stays in place because we very much value the relationships that we have with ERICs. They play a very important part within a much wider research and innovation framework.

On the point about the CJEU, the noble Lord, Lord Fox, reached the point that I had already written down as he was speaking: this measure is pragmatic. It is purely a pragmatic way to approach an issue whereby it may be between the member state, or indeed the ERIC participant, and the ERIC. Someone needs to be able to make a decision there. From the Government’s perspective, we are very content for the CJEU to make that decision because the EU is not a party to that particular procedure.

[Lord Stevenson of Balmacara]

On that point, let us take a practical example. An ERIC is set up and operating. For reasons best known to themselves, our researchers decide that its rules are not currently fair and it needs to change something affecting, let us say, an immigration regulation within the UK. Is the Minister saying that the Government would accept the CJEU’s decision to make that change? This is a fantasy world; I am not trying to say it is a real situation. However, this is the narrow point. The Minister is saying the CJEU will have the authority to change the rules and regulations of the ERIC because they do not affect the UK but, if the rules are changed so that we would have to change our own legislation in order to stay in the ERIC, that cannot be true.

[Baroness Vere of Norbiton]

The rules and regulations are agreed by member states as they come together to form the ERIC, so obviously, those statutes are specific to that ERIC. I take the point made by the noble Lord, Lord Stevenson, concerning if, for some reason, the ERIC regulations fundamentally change. I do not think they have changed since 2008-09 and there is no move to change them whatsoever—let us remember that other non-EU countries would also be impacted by such a change to regulations—so I cannot imagine that there will be a great groundswell to change them. The CJEU is looking at the statutes of the ERIC—not the regulations themselves, the individual statutes of the regulations. Obviously, if a ruling went against us, we would have to consider our position, but we must be realistic: not a single case has ever been taken to the CJEU. We are probably dancing on the head of a pin. We have a mechanism—I do not want to call it a backstop—through which disputes, if there are any, are now resolved and will be in future. We are content to maintain that mechanism and I hope that the noble Lord is too.

I am pleased to say we may well be joining a number of ERICs in the next few years, and I hope that I outlined the process in my opening remarks. BEIS Ministers, using royal prerogative, have authorisation to join an ERIC, but before that happens there is an enormous collaboration process with UKRI, which advises whether it is a good idea for us to join. Securing the funding comes down to priorities, business cases and collaboration between the Department and the Treasury.

[Baroness Vere of Norbiton]

Yes.

That is how, hopefully, we will be getting involved in new ERICs, which may happen soon. I take on board the comments of my noble friend Lord Deben, and I hope I have addressed them in the context of the CJEU and our pragmatic approach to this issue.

The noble Lord, Lord Stevenson, raised the issue of timing—when the legislation will be needed or commenced. Obviously, if we have a deal, we will never need it, and therefore we hope that it will be put to one side. However, there is a possibility that, a scenario in which, we end up with no deal after the implementation period. At that point, this piece of legislation and many others—

[Lord Stevenson of Balmacara]

I am very grateful to the noble Baroness for clarifying that, but does that not leave it completely open? If there is no deal, we have the SI. If there is a deal, presumably there will be discussion and negotiation to arrive at the deal, and this will be part of it. So the issues we are talking about are not settled in that situation. There will have to be discussions about how ERICs function, under what rules, and whether the CJEU is involved. All that stuff will have to come up again, I assume—I am a novice in this matter.

[Baroness Vere of Norbiton]

I am very happy to be asked questions by a novice, although I do not believe that the noble Lord is a novice at all. He is right that discussions are ongoing, particularly in the area of research and innovation, which is a very important area of collaboration for us. He asked about the legislation. That is exactly what will happen. We are looking at one piece of legislation that may not be needed—in fact, there is a very small chance that it will be—but we have to be sure that we have it in case it is.

The noble Lord suggested that I might want to duck the question of the change in funding for research and innovation in the coming years. I am ducking. Obviously, I can make no commitment to future funding; that would be really unwise in the current environment. However, I want to address his point about future opportunities, because it is really important. We have tasked UKRI to develop the first UK national research and innovation infrastructure roadmap. By the end of next year, it will have completed its work and we will have a full understanding of where our money is going and what it is being invested in.

In the course of my research, I happened to find out that UK entities are involved in about 750 research infrastructures encompassing international, European and national RIs. I find that extraordinary. It is really important that we map all these things, examine where our gaps are and fill them.

I have just been told that I need to correct myself. I said that this SI is not needed in a deal scenario; it is needed in a deal scenario. I shall write to the noble Lord and absolutely clarify why it is needed.

The devolved nations have all agreed to the legislation. On immigration, the noble Lord mentioned the potential shortage of skilled labour. He will be aware that a White Paper on immigration will be published shortly. The Government will of course carefully consider the MAC’s recommendations before setting out further detail on the UK’s future immigration strategy. We recognise that we need skilled resources and that they can come from both European Union nations and other nations.

Given those responses and my promise to write on the critical detail concerning when we will need the SI, I commend the regulations to the House.

Package Travel and Linked Travel Arrangements (Amendment) (EU Exit) Regulations 2018

Debate between Baroness Vere of Norbiton and Lord Stevenson of Balmacara

Wednesday 28th November 2018 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

It might be helpful if the noble Baroness could take away from this that we are struggling here a bit with figures, which might or might not be correct, on a spreadsheet that I can see on the Dispatch Box opposite to which we have not had access. If there are impact assessment figures and a calculation that will give some comfort to the noble Lord, Lord Deben, will she write to us explaining them? Otherwise, I do not think that we can say to the House with any degree of sincerity that we have done a proper job of scrutinising this legislation.

[Baroness Vere of Norbiton]

I will certainly endeavour to set out everything that I have said in a letter, although I do not believe that there is any more information to give. The spreadsheet actually consists of my notes, which the noble Lord will definitely not see. However, I will indeed write to noble Lords.

Domestic Gas and Electricity (Tariff Cap) Bill

Debate between Baroness Vere of Norbiton and Lord Stevenson of Balmacara

Committee: 1st sitting (Hansard): House of Lords
Monday 11th June 2018 Grand Committee

[Lord Stevenson of Balmacara]

My Lords, I support the amendment of the noble Baroness, Lady Featherstone. The amendments in this group are variations on the same theme, which is the question of how one can find in the Bill the right balance between the wish to encourage the drive towards reduced carbon and no-carbon generation of power as far as possible and, at the same time, trying to get out of what appears to be a cul-de-sac in which the more we propose exemptions from the tariff for those who exercise clear preferences for green supply and carbon-free generation, the more they will not feel the benefit from measures that are meant to reduce the cost of the electricity and power that they consume. I do not know what the right balance for that is, so this is a probing amendment.

Our solution—we are not wedded to it but I would be interested to hear the Government’s observations on it—is that a situation where a consumer has clearly and unambiguously signified their intention to always select energy provided from wind or other renewable sources might provide a break point in which one could exercise discretion on whether they obtained the benefit of the cap. That seems to play to my earlier concern that this would prioritise people who used carbon-based energy sources as the only ones to benefit from the cap and would therefore reduce their costs.

I am not entirely clear which way we should go on this. It seems unreasonable to take an extreme position one way or the other, but that seems the only way to find an equitable solution. I look forward to hearing the Minister’s response.

[Baroness Vere of Norbiton (Con)]

My Lords, I will address the proposed amendments to Clause 3 from the noble Baroness, Lady Featherstone, regarding arrangements for exemptions from the price cap.

On Amendments 13 and 14, the Government are clear that it is right for Ofgem, as the expert regulator, to look at an exemption from the cap for green standard variable tariffs, remembering that fixed-term green tariffs are not covered by the cap. The Bill requires Ofgem to consult on an exemption and, if it decides to put an exemption in place, it must be for tariffs that are chosen by consumers and which support the production of gas and the generation of electricity from renewable sources.

The Government do not wish to prejudge the outcome of Ofgem’s consultation. We are very much aware of the arguments around having an exemption but are also aware that, as with any exemption, there may be a risk of gaming—or greenwashing, as it is sometimes known. This is a complex area and we should not make any judgments or decisions until Ofgem has undertaken its consultation and examined the approaches to an exemption.

The Government note that many fixed-term green tariffs that support renewable energy generation are already available on the market. These offer consumers considerable savings compared with non-green SVT tariffs. Some new entrants to the market also expect to deliver green standard variable tariffs at levels below where they expect Ofgem to set the price cap. Fixed-term green tariffs would still be available in the event that the regulator chooses not to exempt green SVTs from the price cap. In view of this explanation, I feel that Amendments 13 and 14 are unnecessary.

Amendment 15 concerns vulnerable consumers. As has been noted in relation to earlier amendments, Ofgem will keep the safeguard tariff in place for warm home discount recipients if it offers a higher level of protection than the market-wide price cap under the Bill.

Amendments 16 and 17 are in the name of the noble Lord, Lord Grantchester. Amendment 16 creates a situation whereby, if Ofgem decides that actively chosen green tariffs that support the production of renewable energy should be exempt, all consumers on such tariffs would need to opt in to this exemption; otherwise, the cap would still apply. There may be unintended consequences from this approach. If Ofgem does decide to exempt green tariffs and yet only a small proportion of consumers opt in to the exemption—for whatever reason—these suppliers could find that their tariffs become financially unsustainable. Such a situation could counteract the aim of encouraging and maintaining investment in renewable energy, while also limiting the choice of green tariffs available to consumers. The Government are therefore not convinced that an opt-in clause would be helpful.

On Amendment 17, I remind noble Lords that Ofgem published its policy consultation on 25 May and it remains open for submissions. The consultation contains a section on the green tariff exemption. Ofgem is engaging widely on the consultation, including through workshops with suppliers and consumer groups. As such, the amendment comes somewhat after the fact, and so I believe it is not necessary.

Finally, Amendments 18 and 19 are also in the name of the noble Lord, Lord Grantchester. I agree with the thrust of Amendment 18. As I have said, Ofgem’s policy consultation is already under way. In Appendix 13 of the consultation, Ofgem sets out the proposed criteria by which it may consider green tariffs to be exempt. One is that the green tariffs,

“provide support for renewables, materially beyond support provided through subsidies, obligations or other mandatory mechanisms”.

On Amendment 19, the Bill requires Ofgem to complete the consultation so that the licence modifications giving effect to the price cap include the exemption. Of course, this is subject to Ofgem deciding to put the exemption in place following the consultation. As setting a price cap and determining a robust exemption—subject to the outcome of the consultation—clearly involve a lot of work, the Bill provides a little flexibility in the event that this is not possible. Nevertheless, it still requires Ofgem to put in place any exemption as soon as practicable following the modifications putting in place the cap taking effect. Consequently, the Government do not see the need to include Amendments 18 and 19 in the Bill, and I hope the noble Lord will feel able to not move them.

[Lord Stevenson of Balmacara]

I am sorry to interrupt: perhaps I might check two things with the Minister. I think we agree that there is an issue here that is very difficult to bottom out and therefore the consultation process is obviously helpful in that. What I was trying to get across, although perhaps I failed—I think the noble Baroness, Lady Featherstone, made the same point—is that given that we are in a consultation process, where does this all lie in relation to the Bill? Are the Government really saying that actually this is too difficult to deal with in the Bill and it is being passed to Ofcom to make whatever decision it can make in the light of the consultation?

I am not saying that that is wrong. I just ask the Minister to accept my earlier argument that this was actually rather a difficult principle and perhaps should be in primary legislation; otherwise, there is a question of gaming and other things. The point of principle was whether we should give priority to the encouragement that would flow to smaller, greener energy producers, which would not have their income reduced because they were carved out of the new tariff, at the expense of green-minded ordinary citizens who want to get their supply from green sources but are poor, vulnerable, disabled or fall into the category of needing support but find themselves removed from that support system because they are prioritising green energy. That does not seem fair. I wonder whether we should think very carefully about whether it is right to simply pass this to Ofgem to do on the basis of the consultation or whether we should take a decision within the Bill itself.