Energy Intensive Industries

Debate between Derek Twigg and Paul Farrelly

Wednesday 4th December 2013 Westminster Hall

[Paul Farrelly]

I totally agree. Without a level playing field, the issue is not just the possibility, but the reality of job losses, not least in Scotland, and I will come to that shortly.

[Derek Twigg (Halton) (Lab)]

Before my hon. Friend comes on to Scotland, may I congratulate him on securing the debate? He is very knowledgeable on this matter. Is he aware that the INEOS ChlorVinyls plant in Runcorn uses electrolysis to manufacture chlorine? As a consequence, about 70% of the production costs on the site are accounted for by electricity. Some 1,800 people are employed on the site, so it is important that this matter be resolved. Is it not important that the Government look at the carbon floor price?

[Paul Farrelly]

I thank my hon. Friend for that intervention. I know the INEOS plant on Merseyside—it is an ex-ICI plant—very well, because two of my cousins from the extended Irish side of my family work there. Like all Members, I have had representations from INEOS, which is a major employer in my hon. Friend’s constituency. The company made exactly the same point—that 70% of its costs go on energy, so if we are substantially out of line with our competitors in Europe and the world beyond, it suffers a considerable disadvantage.

--- Later in debate ---

[Paul Farrelly]

I certainly do. As I move to the final page of my remarks, I have some brief comments on the glass industry that reflect my hon. Friend’s concerns.

What the industry wants most of all, however, is a radical change of approach to stop our international competitiveness from being eroded further and even faster. The carbon price floor has inflicted pain on the industry for no discernible benefit, and its dream scenario would have the Chancellor abolish it entirely tomorrow. As with the measures affecting household bills, energy intensive industries would also like to see new climate-related charges, such as contracts for difference, paid from general taxation, because the nature of their businesses are such that they cannot protect themselves against such charges.

Other hon. Members will no doubt want to talk about industries other than ceramics, but before I let them, I will just say a few words about glass, which is another staple industry that is crying out for help. British Glass tells me that, since the UK climate change agreements took effect at the turn of the millennium, half of UK glass manufacturing sites have closed, with some 3,500 jobs lost. Despite the difficulties, it is still a £1.7 billion a year industry, employing 7,000 in the UK, but because it faces rising costs through rising green taxes and being ineligible for the EU help that my hon. Friend the Member for Central Ayrshire(Mr Donohoe) referred to, it fears that yet more jobs will go. We will then simply import more glass, which is bad for our balance of payments.

[Derek Twigg]

My hon. Friend makes an important point. Energy intensive industries form a large part of our manufacturing base. All parties have said that they want to protect and, naturally, improve manufacturing. Otherwise, we will end up importing many more goods. That is why it is vital that we take radical action to ensure that our manufacturing industry is promoted and protected.

[Paul Farrelly]

I entirely agree. From my 12 years as a Member of Parliament, my experience is that—I hope the Minister can change this mindset—the UK’s generally laissez-faire approach to industry, as well as its studious approach to implementing directives, means that we, in effect, give less support to our manufacturers than France, Germany, Italy and other leading nations give theirs.

I want to end with a plea to the Minister, which I am sure will fall on receptive ears as I know him to be intensely practical. If the Government are not minded to be as radical as the industry wants, the industry would certainly like more simplicity, which is a particular plea from BASF and the chemicals industry. End the plethora of levies by merging them into a single carbon tax, with the existing rebate scheme under the climate change agreements, to cut costs and bureaucracy and to reduce the mind-boggling complexity around green taxes and levies that often reduces Members of Parliament to complete confusion.

Thank you for listening, Mr Robertson. I look forward to contributions from colleagues and to the Minister’s response.

Education Maintenance Allowance

Debate between Derek Twigg and Paul Farrelly

Wednesday 19th January 2011 Commons Chamber

[Derek Twigg (Halton) (Lab)]

I am grateful for the opportunity to speak in the debate. I wish that the Secretary of State would stop the nonsense of talking about deficit denial. We know that the bankers caused the crisis. We invested in the economy to ensure that we could keep people in work and in their homes, and so that we could fund education—that is the difference between us and the Government.

We are considering not only cuts to EMA, but the Government’s wholesale betrayal of balancing their cuts towards young people. EMA has been a lifeline for young people, especially those from less well-off backgrounds, of whom there are many in my constituency. However, the cut must be considered in the context of what has happened to the likes of Halton under this Government. In addition to the cut in EMA, we have faced a massive £180 million cut in Building Schools for the Future. The tuition fees policy will have a particular effect on my constituents, and we experienced a £1.2 million education cut last year, although Tory-controlled Cheshire West and Cheshire East councils had a cut of only £600,000. We must not forget that the Government have made a deliberate ideological attempt to make cuts in Labour authorities and areas.

EMA has been an important tool to support young people in education and to encourage them to stay on, succeed and realise their aspirations. It also supports choice because it allows young people to choose the institution that is best for them, not just the nearest one. Ending the payment stacks the odds even more against those who have least but want to get on in life.

Halton benefited from being one of the original pilot areas for EMA. There was a 55% increase in EMA recipients between 2004 and 2010, with last year’s numbers exceeding 2,000 recipients. From talking to young people, I know how important EMA has been to them, so its withdrawal will lead to students dropping out and becoming NEETs—those not in employment, education or training—which will have a significant economic and social impact in deprived areas such as Halton. That would go against the so-called coalition’s policy of reducing the number of NEETs, and it would also reverse the marvellous progress that has been made in Halton to reduce its proportion of NEETs from 8.3% in 2007 to 4.5% last year.

The Association of Colleges reports that the National Foundation for Educational Research estimates that 12% of young people who received EMA believed that they would not have participated in their courses if they had not received it. In some colleges, half the students surveyed said that they felt that they would not be able to continue their course following the withdrawal of EMA, while a further third thought that they would need to weigh up the pros and cons of staying on at college.

Mike Sheehan is the widely respected principal of my constituency’s Riverside college—the college I attended. He has turned round a number of failing colleges and is achieving great things at Riverside college. He says that the withdrawal of EMA on new year’s eve has adversely affected recruitment to the college’s January programme. The figures are down by almost three quarters—just 25 students compared with 106 last January. He is worried about the students who enrolled on two-year courses in full expectation of receiving EMA throughout their course. It is unfair that EMA is being withdrawn partway through courses, and the Association of Colleges says that that will affect 300,000 young people throughout the country. Mr Sheehan says:

“Attendance, retention and achievement have risen drastically at Riverside College in recent years. We are absolutely convinced that EMA has played a significant part in bringing about these improvements. It has provided a real incentive for young people to attend fully and to stay at college.”

Some surveys have pointed to higher attendance and take-up rates for courses among young males from disadvantaged backgrounds who receive EMA. That is especially important in deprived areas such as Halton, and that is to say nothing about the higher earning potential of better-qualified students who complete college and the contribution to the economy that they can therefore make. According to this month’s Commons Library statistics on EMA and the Government’s research figures, that contribution more than offsets the costs of the EMA programme.

Both the Secretary of State and his shadow spokesman touched on a fundamental aspect of EMA for students from poorer backgrounds: the ability to pay for meals, books and educational equipment. One of the main uses of EMA, however, is the funding of transport. In December 2010, the Association of Colleges commissioned a survey to detail the accessibility of transport to people aged 16 to 19 attending college. It found that 94% of colleges believe that the abolition of EMA will affect students’ ability to travel to and from college. The support given by local authorities is extremely varied. Some 29% of authorities provide transport while 20% give financial support. Around 18% provide both, but 27% provide neither. Existing local authority transport provision is extremely patchy, and local authorities cannot be expected to pick up the tab for the withdrawal of EMA.

The Secretary of State might wish to examine Halton’s case. We had £30 million taken out of a £130 million budget as a result of the local government settlement, in-year cuts and other changes to programmes. If he thinks that any council, let alone a small one such as Halton, can bear such a cut without services being affected, he is in a different world. Councils cannot find additional funding to fill that sort of gap.

[Paul Farrelly]

Does my hon. Friend agree that, as with the rest of the cuts agenda, the Secretary of State’s debt argument is simply a spurious decoy? Estimates of the debt position improved following the election, so the position was better after the election than when the Secretary of State promised that he would not abolish EMA.