Oral Answers to Questions

Kwasi Kwarteng Excerpts

Tuesday 25th May 2021 Commons Chamber

[Mr Laurence Robertson (Tewkesbury) (Con)]

What steps he is taking to increase the opportunities for generating electricity locally.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

We are providing support for the delivery of renewable energy projects within rural communities in England through the £10 million rural community energy fund programme.

[Mr Robertson]

I thank the Minister for that response. Does he agree that the production of electricity locally could help a great deal towards our net zero target? Will he also look at the situation in my constituency of Tewkesbury, where two rivers, the Avon and the Severn, join? The Severn would, I think, be particularly useful in producing electricity if we could get the schemes in place. Will he look at that and perhaps explore the possibilities?

[Kwasi Kwarteng]

My hon. Friend correctly observes that there are two major rivers in Tewkesbury, the Avon and the Severn—very beautiful rivers, I might add. As far as hydroelectric power on rivers is concerned, we would have to look at the hydraulics and the power that can be generated, but we clearly appreciate that there is potential there, and we want to explore any ideas that can bring those projects to fruition. Having said that, there is a limit to the capacity that such rivers can generate, unfortunately.

[Stephen Flynn (Aberdeen South) (SNP)]

Just last week, the Secretary of State accepted that the inexcusable costs facing Scottish renewables projects trying to access the electricity grid had been an issue for a long time, notwithstanding the 11 years that his party has been in government. The Government continue to blame Ofgem while at the same time refusing to accept that they are the ones who set Ofgem’s strategy and policy statement. On that point, can the Secretary of State outline when the consultation detailed in his energy White Paper will begin, when it will end and when we will see real change—or are UK Energy Ministers simply among the worst idlers in the world?

[Kwasi Kwarteng]

The hon. Gentleman makes a pointed and unfair observation at the end of his remarks, which I think is beneath his dignity. I know that he is referring to “Britannia Unchained”, a classic work published 10 years ago, but 10 years is a very long time and I do not want to revisit those battles. I will say what I have said to him before: this is an issue for Ofgem and we are discussing how to seek to make progress on that important subject.

[Jason McCartney (Colne Valley) (Con)]

What steps his Department is taking to support the Government’s levelling-up agenda.

[Tom Hunt (Ipswich) (Con)]

What steps his Department is taking to support the Government’s levelling-up agenda.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

We have made a commitment to level up all areas of the country. The plan for growth is a critical part of that, and we will go further with the publication of a levelling-up White Paper, led ably by my hon. Friend the Member for Harborough (Neil O’Brien), later this year.

[Jason McCartney]

I fully welcome the Prime Minister’s 10-point plan for a green industrial revolution as we build back greener. Green eco-businesses in my Colne Valley constituency are ready to play their part, so can I please suggest to the Secretary of State that if the Department for Business, Energy and Industrial Strategy or any other Government Department is looking to relocate to the north, towns such as Slaithwaite and Marsden, with their mills and their direct rail links to the likes of Manchester and Leeds on the trans-Pennine line, would be ideal locations?

[Kwasi Kwarteng]

As my hon. Friend will appreciate, we are looking at many ideal locations at the moment. I was pleased to make an announcement last week about Darlington; that is a really good move for the Department. We are always looking at ways to create more employment and recruit really great talent for our Department across the country, and I am sure that his constituency will also—perhaps—be among those considered for such expansion.

[Tom Hunt]

My constituents are very proud of the north of England and the midlands, even though we are in East Anglia, but they want a firm commitment from the Government—it cannot be stressed enough—that the levelling-up agenda also covers Ipswich. Of course, we have the £25 million from the town deal, which goes some way to assuaging these concerns. However, does my right hon. Friend agree that the skills improvement plan pilot bid from Norfolk and Suffolk could be a fantastic example to prove to the people of Ipswich that we are in fact at the heart of the levelling-up agenda? Will he engage in discussions with the Department for Education about the possibility of that pilot scheme, which would also feed the new freeport east in Felixstowe, which already employs 6,000 of my constituents but could employ many more?

[Kwasi Kwarteng]

My hon. Friend is quite right. He was good enough to mention the fact that Ipswich has indeed been selected for a £25 million town deal, and he suggested that that was as a matter of course, but I think it is due to his keen advocacy and his eloquent and persuasive powers that the Government can provide help in that way. Clearly, skills are at the core of any levelling-up agenda, and I know that there are great ideas in Ipswich and great things being promoted in East Anglia. I look forward to engaging with him on that.

[Judith Cummins (Bradford South) (Lab)]

When his Department plans to publish the ACAS report on fire and rehire and the Government’s response to that report.

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[Ian Paisley (North Antrim) (DUP)]

What steps he is taking to support the UK’s hydrogen economy.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

The second point of the 10-point plan was all about hydrogen. The forthcoming hydrogen strategy will set out clearly what we hope to see and are committed to seeing for the hydrogen economy in 2030.

[Ian Paisley [V]]

I thank the Secretary of State for that answer. Will he go a little further and explain how, and commit that the strategy will actually deliver specific jobs in Northern Ireland, as well as in the rest of the United Kingdom? Will he continue to agree to meet me and other parliamentary colleagues to ensure that Northern Ireland gets a fair share of the hydrogen strategy as it is rolled out? As he knows, this is so important to the future economy of Northern Ireland.

[Kwasi Kwarteng]

I will certainly continue to agree to meet the hon. Gentleman at any time. There are very important hydrogen projects in Northern Ireland. I speak to Mr Bamford and others, particularly in relation to Wrightbus, which I understand is in the hon. Gentleman’s constituency. There is a huge opportunity, and I would be happy to meet him and others to discuss the prospects at any time.

[Owen Thompson (Midlothian) (SNP)]

What recent discussions he has had with the Chancellor of the Exchequer on increasing support to businesses affected by the covid-19 outbreak.

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[Jessica Morden (Newport East) (Lab)]

What steps he is taking to support the UK steel sector.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

The Government are committed to a UK steel industry. I mentioned this repeatedly in my session with the Business, Energy and Industrial Strategy Committee this morning.

[Nick Smith]

Sanjeev Gupta promised that none of our steel plants would close on his watch, but after the Serious Fraud Office descended on his empire, the workforce became afraid for their future. The Liberty Steel plant in Tredegar puts food on the table and pays the mortgages of my constituents, and across the country 5,000 families rely on the company. We now need the Government to ensure that these plants remain open, and, crucially, to provide the finance to bridge any transition period should a new buyer or stake purchase be necessary—and, of course, to work with the trade unions to test the commitment of any new buyers. If promises are broken, will the Secretary of State step in with the finance to support our steel communities?

[Kwasi Kwarteng]

The hon. Gentleman will remember that Mr Gupta asked me and the Department for £170 million. Many Labour Members—dare I say it?—were hollering and screaming and saying we should nationalise. In fact, I would say that my actions and those of officials have been vindicated. There were serious concerns about corporate governance with this company, and Labour Members would do well to understand how to manage public finances with care. Having said all that, I am monitoring the situation closely and I remain strategically committed to the steel industry and this sector.

[Jessica Morden]

On behalf of workers at Liberty Steel in Newport, I agree with my hon. Friend the Member for Blaenau Gwent (Nick Smith): the Government must do all they can to protect these strategic businesses that are very important to our communities. Because of that, and because of global overcapacity in steel, it is also critical and very urgent that Ministers work with Cabinet colleagues to prevent the Trade Remedies Investigations Directorate from slashing our steel safeguards in half, so please will the Government act on that?

[Kwasi Kwarteng]

With regard to TRID, the hon. Lady will know that the consultation on that closes tomorrow. I would urge all interested parties to feed into that consultation so that we can reach a good decision. She knows that I am on record as having committed to a strategic presence of steel in the UK . I think that is vital and as Secretary of State I will always promote it within Government.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

The crisis at Liberty Steel is yet further evidence of the need to break the cycle of crisis management that has defined the approach of successive Governments to this critical sector. The Secretary of State knows full well that there is a global race under way to green the steel industry and that our country is currently at the back of the pack, with no concrete plans for trialling hydrogen-based primary production and only vague plans for a single carbon capture-based project. With its long-term survival at stake, can he explain why the Government believe that the UK steel industry can afford to wait a further two years for the limited clean steel fund to even begin distributing investment?

[Kwasi Kwarteng]

I completely reject the basis of the hon. Gentleman’s remarks. The idea that we are at the back of the pack in decarbonisation is complete nonsense. We are the first country in the G7 to have come up with an industrial decarbonisation strategy. He and his Labour colleagues were saying, “Secretary of State, why don’t you nationalise Liberty? Why don’t you give Mr Gupta £170 million?”, and we made absolutely the right call. We showed judgment and restraint. Going forward, he will appreciate that I was the Secretary of State who resuscitated the Steel Council. We have had constructive conversations across unions and employers to work out a decarbonised future for the industry.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

What new plans he has to incentivise businesses to become more environmentally sustainable in the transportation of their products.

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[Tonia Antoniazzi (Gower) (Lab)]

What recent steps he has taken with the Secretary of State for Work and Pensions to improve the enforcement of workplace health and safety laws.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

Workplace health and safety is of critical importance, and I am in regular discussion with my right hon. Friend the Secretary of State for Work and Pensions on this and other issues.

[Tonia Antoniazzi]

If the Government are so committed to keeping workers safe throughout the pandemic, can the Secretary of State explain why they have not been able to protect workers at the Driver and Vehicle Licensing Agency in Swansea by putting in measures to keep them safe from covid-19?

[Kwasi Kwarteng]

The hon. Member will appreciate that public health and guidance for safer working in Wales is a devolved matter, so she should certainly bring this up with her colleagues in the Welsh Government. Public Health Wales and the local authority, supported by the Health and Safety Executive, are working with the DVLA to ensure that there is appropriate protection.

[James Sunderland (Bracknell) (Con)]

What steps his Department is taking to support UK manufacturing.

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[Elliot Colburn (Carshalton and Wallington) (Con)]

  If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I would like to say that over the last few weeks I think we have gone through a trying time, but two things have really stood out as remarkable successes. The vaccine roll-out continues to go from strength to strength. Something like 60 million jabs have been administered across this country, which I am pleased to say is a world-beating target to have reached for a country of our size. On the back of that, we have managed to hit the dates in the road map. On 12 April, we opened up in the way we said we would, and then we looked at the data and we were able to do so again on 17 May. This has provided business with a huge degree of support and a measure of certainty ahead of a summer reopening.

[Elliot Colburn [V]]

Carshalton and Wallington residents, particularly those living in New Mill Quarter in Hackbridge, have been suffering at the hands of the Lib Dem-run council-owned district energy network called SDEN—Sutton Decentralised Energy Network—leaving residents without heating and hot water, some more than a dozen times in just six months. I know BEIS is keen to ensure that residents such as these are not victims of shoddy operations, so following the closure of its consultation last year, what steps is my right hon. Friend taking to ensure that district energy networks are regulated?

[Kwasi Kwarteng]

It is an excellent question. My hon. Friend and I corresponded about this and spoke directly about this when I was the Minister of State for Energy. I am very pleased to tell him that we are committed to regulating the heat networks market within this Parliament, and we will bring legislation forward at the earliest possible opportunity. It is clearly a really important thing to be doing, and he and his constituents can rest assured that we are acting with due speed.

[Edward Miliband (Doncaster North) (Lab)]

I want to return to fire and rehire. Chris is a British Gas engineer who lives in Spelthorne, the Secretary of State’s constituency. Chris says:

“Working under fire and rehire has been horrific. It has caused stress and anxiety not just for me, but my family. I can’t overstate the effect that it has on mental wellbeing. And the Government and the Business Secretary, who is supposed to represent me…in parliament is doing absolutely nothing about it. I voted for Kwasi Kwarteng in 2019, but he’s failed us on this. A total let down.”

Chris met the Business Secretary recently and asked him why he had not acted on fire and rehire. What did he tell him?

[Kwasi Kwarteng]

I remember the meeting well. I met Chris, I think on the Avenue in Sunbury, and I said very clearly to him that we had an ACAS report that we hoped to publish in due course, and that once we published that we would set out further action, as the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Sutton and Cheam (Paul Scully), very ably mentioned earlier.

[Edward Miliband]

The problem is that the right hon. Member is the Business Secretary. He is in charge. He promised an employment Bill two years ago. He has had the ACAS report for three months. He is not even telling us what is in the ACAS report. Maybe he can satisfy Chris and millions of people around this country by saying from the Dispatch Box today that he agrees with the principle that we should legislate to outlaw fire and rehire, and he will bring forward an employment Bill to do it. If he does not do that, people will suspect that the truth is not that he is not acting because he cannot act, but that he is not acting because he does not want to act, because he thinks this kind of one-sided power for employers is necessary for our economy to succeed.

[Kwasi Kwarteng]

We all know the Marxist trope of the employers versus the workers, and we have moved on from that—most of us. There are two issues there. One was related to the employment Bill, which we are committed to introducing to this House when we can, and that has always been our position. The second is that the whole point of having an ACAS independent report was to allow it to happen and then we would consider, after publication, the steps forward. I know the right hon. Member is impatient, and I know he is probably wishing that there was a leadership change in his party, but we have to stay focused on delivery.

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[Stephen Flynn (Aberdeen South) (SNP)]

Stats released by the Office for National Statistics this morning show that trade with the European Union has fallen by 23% in the first quarter. In the meantime, Scottish farmers are facing up to the reality of a trade deal with the Australians that threatens their very future. The Scottish Parliament—it has no say; the Scottish Government—ignored. What exactly will the UK Business Secretary do about that, and how much damage are his Government willing to cause?

[Kwasi Kwarteng]

The hon. Gentleman is right to mention the ONS data, but he will appreciate that that is comparing quarter 1 this year with quarter 1 last year. [Interruption.] Of course it does. January was exceptionally bad—I fully admit that—because there was uncertainty about how the new deal would operate. Subsequent data from Q2 and from March was much better, The next quarter will have better results, and I am sure that quarters after that will show proportionate improvement. The Australian trade deal is a fundamental issue for us. If we cannot make a trade deal with a country that has shared legislation, shared history, and shared traditions, we will not get anywhere with any of these trade deals. I think this is an excellent opportunity for the UK.

[Mr Laurence Robertson (Tewkesbury) (Con)]

The Government are to be congratulated on their plans to phase out diesel and petrol cars, but that raises the question of how we will charge electric cars, especially for those who do not have driveways and have to park on the roads. What can we do to speed up the development of the infrastructure?

[Layla Moran (Oxford West and Abingdon) (LD)]

  The green homes grant was scrapped at the end of March, due to severe mismanagement. Nevertheless, we urgently need a long-term strategy to help homeowners cut emissions and bills, if we are to tackle the climate emergency properly. Now that local authorities have been awarded £300 million to deliver the green homes upgrades, what steps is the Secretary of State taking to ensure that councils have all the support they need to jump over bureaucratic hurdles and handle the unrealistic deadlines created for them, so that we can significantly cut carbon emissions across UK homes?

[Kwasi Kwarteng]

The hon. Lady will appreciate that the green homes grant initially had three elements: the first dealt with owner-occupier houses, the second was distributed by local authorities in the way she describes, and the third was about public sector building decarbonisation. Two of those elements were successful. The third was a short-term stimulus, which we have closed and are looking to replace.

[Mrs Flick Drummond (Meon Valley) (Con)]

  Many of my constituents work in the aviation sector and at Southampton Airport. Advances in green technology to cut emissions are vital for the future of air travel, and that may even include electric airplanes, powered by greener fuels. Will my right hon. Friend outline what encouragement the Government will provide in that area?

[Kwasi Kwarteng]

We have done a number of things that I am sure my hon. Friend will appreciate. I was very pleased, with my right hon. Friend the Transport Secretary, to appoint Emma Gilthorpe as chief executive officer of the Jet Zero Council, which brings together considerable industry expertise to drive sustainable aviation fuel. Electric aeroplanes may be a thing of the future, but clearly, we have the technology today to innovate and to use things such as hydrogen and sustainable fuels to power a net zero aviation sector.

[David Linden (Glasgow East) (SNP)]

  The Secretary of State will be aware of pladis’s proposal to close the McVitie’s factory in Glasgow’s east end, putting at risk up to 500 jobs in a very fragile part of the local economy. On Saturday, I, politicians from across parties and, indeed, the GMB union came together to send a loud message to Salman Amin in Turkey that doing so would put the local economy at risk. Will the Secretary of State join us in calling on pladis to rethink these devastating plans, which would deliver a hammer blow to the local economy in Glasgow and Scotland?

[Kwasi Kwarteng]

In my business engagement, I have been lucky enough, I suppose, to meet the CEO of pladis, the McVitie’s operator. I am not particularly aware of the specifics of what the hon. Gentleman has just informed the House, but I would be very happy to speak to him and others to see what we can do to ensure that the situation is improved. The business seems open; I had a good conversation with the CEO, but I would like to hear more about the specific details of that plant.

[Suzanne Webb (Stourbridge) (Con)]

Levelling up has never been more important than in the historic town of Lye in my constituency, an area that I am determined to help regenerate—made easier, I hope, by the funding put in place by this Government. One business in Stourbridge, I’m Lucky, was unlucky enough to open just before the second lockdown, but with Government support, and helped by its own fantastic entrepreneurism, it has survived. It now has an online shop front, and it has begun recruiting staff. Does my hon. Friend agree that businesses such as I’m Lucky have a vital role to play in levelling up this country?

[Peter Gibson (Darlington) (Con) [V]]

Following the Budget, the Leader of the Opposition said that establishing “Treasury North” in Darlington was “not levelling up” but “giving up”. Does my right hon. Friend agree that the opposite is true, and that by shifting decision making outside London, including in his own Department, we will truly level up our country?

[Kwasi Kwarteng]

My hon. Friend is absolutely right; it is a huge opportunity. I was delighted to see him in his constituency only a couple of weeks ago. I was very pleased to see the photograph that was taken of us looking like an advert for “Reservoir Dogs”. BEIS is absolutely committed to recruiting excellent staff in Darlington, among other places around the UK.

[Kate Osamor (Edmonton) (Lab/Co-op) [V]]

  Following the announcement that the Government plan to cut £120 million from official development assistance research, what assessment has the Secretary of State made of the long-term impact that that will have on UK research and development?

[Kwasi Kwarteng]

The hon. Lady will know that that was a very difficult decision. The Treasury and the Government made a decision to reduce ODA spending from 0.7% of GDP to 0.5%. In the integrated review, we said that we would get it back to 0.7% when we could. We are fully appreciative that it was a difficult decision, and we want to get back to 0.7% as soon as the fiscal situation allows.

[Sally-Ann Hart (Hastings and Rye) (Con) [V]]

  The Government are already embarking on their unprecedented levelling-up agenda. What measures is my hon. Friend planning to facilitate levelling up by small businesses, looking specifically at start-ups and growing SMEs, as well as at issues arising from late payments, reducing employment costs, improving skills such as digital skills, and levelling up apprenticeships? Those are the specific questions asked by the Federation of Small Businesses in Hastings and Rye.

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[Tony Lloyd (Rochdale) (Lab) [V]]

May I ask the Minister for an unequivocal statement, consistent with the Government’s zero-carbon promises, that there will be no new coal mines and no new licences for fracking in this country?

[Kwasi Kwarteng]

There are two issues there. On fracking, I was very pleased, as Minister of State, to impose a moratorium on it. The language that we used at the time was that it was going to be evidence-focused and scientifically based. There is no new evidence to suggest that we should end the moratorium, so it stays—no more fracking. On coal mines, I have said specifically that this is a judicial issue, in terms of the west Cumbrian coal mine, and that has to go through the planning process.

[Stephen Metcalfe (South Basildon and East Thurrock) (Con)]

As the Minister knows, I am passionate about inspiring the next generation of scientists and engineers. Will she tell the House what plans her Department has to build on the previous good work in this field, such as the Year of Engineering?

10-point Plan: Six Months On

Kwasi Kwarteng Excerpts

Tuesday 18th May 2021 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

With your permission, Mr Speaker, I would like to make a statement. Last November, the Prime Minister announced a radical and ambitious response to the economic impact of covid-19. This was, of course, the UK’s 10-point plan for a green industrial revolution. Its aim is to build back better, to use our recovery to level up the country, to scale up new industries and to support jobs throughout the United Kingdom as we accelerate on our path to net zero by 2050.

Six months on, I am pleased to inform the House that we are already seeing this ambition being delivered on. The 10-point plan is projected to create and support up to 250,000 jobs, and mobilise £12 billion of Government investment and up to three times as much from the private sector by 2030. We are investing in the UK’s most important asset—our workforce—to ensure that our people have the right skills to deliver the low-carbon transition and thrive in the high-value jobs this will create. This is the case for the engineers and construction workers who will build the new offshore wind farms and nuclear plants to provide clean power to our homes, to the retrofitters who will make homes more comfortable and efficient. This work of course builds on the strong progress we have already made as a country in decarbonising our economy. Last year, we hit over two months of coal- free electricity generation, which is the longest streak since the industrial revolution. Two weeks ago, we broke a new wind power record, with both onshore and offshore wind turbines generating 48.5% of the electricity in Great Britain. The plan is projected to reduce UK emissions by 180 million tonnes of carbon dioxide equivalent between 2023 and 2032. I am sure Members are aware that that is equal to taking all of today’s cars off the road for about two years.

Since the 10-point plan’s publication, we have enshrined the UK’s sixth carbon budget in law, proposing in that a target that would reduce greenhouse gas emissions by 78% by 2035 compared with 1990 levels. That is an enormous commitment, but one that we are working extremely hard—flat out, indeed—to achieve. Our Energy White Paper has set out a comprehensive, strategic vision for the transformation of the energy system consistent with delivering net zero emissions by 2050. We have also launched our new, ambitious UK emissions trading scheme, for consultation later this year.

On offshore wind, we have confirmed up to £95 million of Government investment for two new offshore wind ports: Able Marine Energy Park—AMEP—on the south bank of the River Humber, which will receive up to £75 million of government investment; and Teesworks offshore manufacturing centre, on the River Tees, which will receive up to £20 million. Those investments have already been endorsed by business. Since the launch of the 10-point plan, we have seen a 501% increase in British businesses signing up for the UN’s Race to Zero initiative. Rolls-Royce is working on the world’s largest jet engine, which will cut aviation emissions, as part of its £500 million UltraFan engine project. Jaguar Land Rover has announced plans to be all-electric from 2025, with Ford, Bentley, Volvo and Nissan stating that they will do this from 2030. Just today, GE Renewable Energy has announced that it expects to create up to 470 green jobs to support the delivery and operation of all three phases of the Dogger Bank wind farm, the world’s largest offshore wind farm, located off the north-east coast. The impressive growth of the offshore wind sector presents a great example of how delivering net zero will help us level up across the UK. It also demonstrates the confidence that international investors have in our contracts for difference approach and the immense confidence employers have in our people, particularly those in the north-east, where so much of this infrastructure is being deployed.

However, this is not just about energy; each of us has a contribution to make. We are helping businesses and people to go greener every day, by delivering on our commitment to greener business, buildings and transport. In March, we published the UK’s industrial decarbonisation strategy, the first strategy of its kind from any major economy in the world. It sets out clearly how industry can meaningfully decarbonise, remaining competitive and reducing emissions, instead of simply offshoring our industries and pushing emissions abroad.

To that end, the industrial energy transformation fund has already allocated nearly £300 million to 39 projects to help industry transition to a low-carbon future. This month we began the process for deciding the first carbon capture cluster locations in our industrial heartlands, which will be operational by the mid-2020s, with another two set to be created by 2030. All of this increased investment totals £1 billion, helping to support 50,000 jobs, potentially, in areas such as the Humber, the north-east and the north-west, and in Scotland and Wales. We are providing £1 billion of funding to phase 1 of the public sector decarbonisation scheme, which will support up to 30,000 jobs. These jobs will be in building services, engineering and design, low-carbon heating, installation of renewable energy sources and energy efficiency measures.

The 10-point plan is our commitment on meeting the fourth and fifth carbon budgets. Further strategies for sectors of the economy will be set out over the next year. This will include publication of our heat and building strategy, ahead of COP26, to set out our long-term approach to reducing emissions from all buildings in this country. It also includes our hydrogen strategy, which is backed by a £240 million net zero hydrogen fund investment, to support—I stress this point—both green hydrogen produced by electrolysers, and blue hydrogen enabled by carbon capture and storage.

We have also committed a further £20 million to increase the number of on-street charge points for electric vehicles. We will provide £50 million to help people and businesses install these charge points. We will also publish our transport decarbonisation plan as soon as possible, setting out an ambitious pathway to end UK transport’s carbon emissions by 2050 at the latest. I know that my right hon. Friend the Secretary of State for Transport is fully engaged and committed to publishing that.

The impact of those commitments can already be seen. As of March 2021, battery electric vehicle sales stand at 7.7% of the market, and plug-in hybrid electric vehicle sales are 6.1%, which is a huge increase of 88% and 152% respectively from only a year ago. Our acceleration towards low-emission vehicles will not only contribute to cutting our carbon emissions, but strengthen British industry through supporting up to 40,000 jobs by 2020.

All these policies and initiatives are coming together and will be set out in our net zero strategy in the autumn. The strategy will build on the 10-point plan, and it will make the most of new growth and employment opportunities across the UK as we build back better and greener from covid-19.

It will not have escaped hon. Members’ notice that we will be hosting COP26 towards the end of the year, and what we are doing now is setting the scene for that historic event. In that context, our ambition and our leadership are absolutely crucial. The 10-point plan demonstrates our commitment not only to the green recovery, but to the kind of leadership that we want to show in this vitally important year. All these actions bring us a step closer to net zero by 2050, meeting this planet’s greatest threat with ambition and innovation, which is absolutely necessary if we are to hit our goals. I believe passionately and sincerely that a new era of green jobs through Britain’s green industrial revolution has been inaugurated. I commend this statement to the House.

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[Kwasi Kwarteng]

The right hon. Gentleman raised a number of points. The heat and buildings strategy was always due in 2021; I know that because I commissioned it when I was the Energy Minister. I hope it will be published shortly. We also have a hydrogen strategy. He mentioned that our £240 million hydrogen fund was little compared to other countries, but private sector investment has been very successful in the deployment of offshore wind. The reason we have a commanding position—the No. 1 position—in offshore wind deployment is not because of the Government writing cheques; it is because the Government created incentives for the private sector to invest. That will be exactly the way in which we will scale up the hydrogen economy.

The right hon. Gentleman mentioned offshore wind and the UK content of the supply chain. We are absolutely focused on that; we potentially have an auction round 4 at the end of this year, and I am committed to increasing—in fact, we have policies to increase—the level of UK content in offshore wind. The GE Renewable Energy announcement in Teesside only a couple of months ago, in which it committed £142 million, is exactly the kind of investment and commitment to the UK supply chain that we want to see.

[Greg Clark (Tunbridge Wells) (Con)]

Point 4 of the 10-point plan refers to the need for large-scale battery factories for electric vehicles—sometimes called gigafactories. They need to be up and running within five years, so will the Secretary of State update the House as to where we are in securing them? Will he also comment on the state of discussions about the future of Vauxhall at Ellesmere Port, with its ambitions to build electric vehicles there?

[Kwasi Kwarteng]

I am pleased that my right hon. Friend mentions gigafactories and the opportunities that they represent. There are conversations as we speak between people who are making batteries and the car makers; clearly, the dynamic between the auto manufacturers and the people who will be making the batteries is an important one. I hope to make a positive announcement about that soon. In relation to Ellesmere Port, there are very positive discussions with Stellantis. I am very much engaged with this matter, and we are particularly hopeful that we can make some movement in the summer on this too.

[Stephen Flynn (Aberdeen South) (SNP)]

I welcome the statement in so far as it goes, but there is need for further clarity. Hydrogen has been mentioned on a couple of occasions. When exactly does the Secretary of State expect the hydrogen strategy to come forward, and how does he expect the business models to operate in practice?

We have concerns not just about hydrogen and the delays in that regard, but in relation to carbon capture and underground storage. The House will be cognisant of the fact that in 2017 the Government pulled the plug on £1 billion-worth of investment in Peterhead. We know that there are plans to have two clusters in place by the mid-2020s. One of those clusters has to be in the north-east of Scotland, linking the north-east of Scotland with Grangemouth, because of course Scotland has contributed more than £350 billion in oil and gas revenues to the UK Treasury. There can be no just or fair transition if the communities that I represent and others in Grangemouth are left behind.

My final point is in relation to an issue that appears to have escaped the notice of the Secretary of State in his statement, and that is transmission charges. He will be aware that our renewables project in Scotland must pay to access the grid, whereas the renewables project in the south-east of England gets paid to access the very same grid. I see that the Energy Minister is in her place. That is important because she wrote to me on 12 April and said:

“On the specific question of grid charging arrangements, it is important to note that this is a matter for Ofgem as the independent regulator.”

However, as the Minister knows only too well, Ofgem’s strategy and policy is determined by the UK Government. Indeed, the Government’s own energy White Paper states, on page 86:

“We will set out our vision for energy as a guide to Ofgem, by consulting in 2021 on a Strategy and Policy Statement for the regulator.”

When will that consultation begin and when will this Government stop holding back Scotland’s renewables potential?

[Kwasi Kwarteng]

The hon. Gentleman raised three issues. The hydrogen strategy should be coming out in the summer. It is a twin-track strategy, as I described it as Energy Minister. We are committed to the production of both green, electrolyser-produced hydrogen and blue hydrogen, which comes from carbon capture.

That leads me to the hon. Gentleman’s second point. He will know that there are a number of attractive sites for carbon capture here in the UK. We have set out our road map for two clusters by 2025 and two more by 2030, and we are in the process of deciding how to proceed on that. He can rest assured that Acorn is a very attractive project; it is something that I have looked at, and I am sure we will have some more information on that.

On offshore transmission charges, the hon. Gentleman knows that this has been an issue for a long time. I committed to looking at it as Energy Minister, and we will have a consultation on that. He must also appreciate that the Minister for Business, Energy and Clean Growth, my right hon. Friend the Member for Berwick-upon-Tweed (Anne-Marie Trevelyan), is absolutely right: this is ultimately a matter for Ofgem, which, as he knows, is an independent regulator.

[Derek Thomas (St Ives) (Con)]

I thank the Secretary of State for his statement, and I too particularly look forward to the publication of the transport decarbonisation plan. In west Cornwall, we are working up a plan to bring the towns of St Ives, Penzance and Hayle together in a low-carbon transport plan, bringing together the railway, the roads and multi-use off-road tracks. Will the Secretary of State look at how he can help us to achieve that? Also, if it so happens that he is down in my neck of the woods in a month’s time for the summit, maybe he could meet us to hear about our ambitious plans to provide low-carbon transport for all people living in west Cornwall.

[Kwasi Kwarteng]

I am pleased to say to my hon. Friend that I would be happy to meet him in Cornwall at any time of his choosing, provided, of course, that it fits in with my diary commitments. I am fully aware of the transport decarbonisation plan being absolutely crucial to his constituents—

[Edward Miliband]

When?

[Kwasi Kwarteng]

The right hon. Gentleman asks when. Unfortunately, wide though BEIS’s purview and authority are, my right hon. Friend the Transport Secretary will have a more accurate perspective on when that strategy will be published.

[Darren Jones (Bristol North West) (Lab)]

The Secretary of State knows that how we heat our homes and insulate our buildings is an urgent issue that will affect every house across the entire country. He told the Select Committee a few weeks ago that the heat and building strategy would arrive at the end of Q2. Unless I have misunderstood, that is not before COP26; it is around now. Can he update the House as to why it has been delayed once again?

[Kwasi Kwarteng]

When I was Energy Minister, I wanted it to appear in the first quarter and I think I made public commitments to that. The hon. Gentleman will understand that many of the issues have been discussed across Government, and I am very confident that the heat and building strategy will be published soon. I cannot, however, give him a firm cast-iron date on this.

[Felicity Buchan (Kensington) (Con)]

I welcome the focus on electric vehicles in the 10-point plan and the £1.3 billion investment in accelerating the roll-out of the grid infrastructure. Does my right hon. Friend agree that we need a comprehensive network of ultra-rapid charging points in order to accelerate the uptake of electric vehicles and to get rid of a lot of the range anxiety?

[Kwasi Kwarteng]

My hon. Friend is absolutely right. When MPs talk to their constituents, we hear them talk about range anxiety, and it is critical that we have the right charging infrastructure to drive forward the EV roll-out. We have committed public funds to this, but I am very happy to discuss with her, as it is obviously critically important. I feel that we are in a good place, but I would be very interested to hear her ideas.

[Sarah Olney (Richmond Park) (LD)]

The 10-point plan announced 50,000 new jobs in energy efficiency, which may or may not have been in addition to the 80,000 new jobs that were due to be created by the green homes grant announced last summer in the Government’s plan for jobs. My repeated written questions to the Department to clarify whether those 50,000 jobs are in addition to the 80,000 have not yet elicited a clear answer, so could the Secretary of State tell me how many jobs in energy efficiency have been created so far, and what plans are in place to create more, now that the green homes grant has been scrapped with no plan to replace it?

[Kwasi Kwarteng]

The 50,000 jobs related to the green homes grant. The hon. Lady will know that there were three elements to the green homes grant. One related to the decarbonisation of public sector buildings. That was £1 billion deployed through Salix. That has gone extremely well. Of the remaining £2 billion, £500 million was to be disbursed by local authorities for council housing, social housing and people who are vulnerable. That programme is going very well. What has been rejigged has been the half that related to owner-occupied buildings. It was a short-term stimulus plan that was due to run out in March this year, and we are looking at a replacement scheme.

[Jack Brereton (Stoke-on-Trent South) (Con)]

I welcome the ambitious plans that my right hon. Friend has set out to clean up our energy system and support green British jobs as we work to end the UK’s contribution to climate change by 2050. However, can he confirm that he will prioritise keeping bills affordable, particularly for lower-income households in Stoke-on-Trent, as we transition towards net zero?

[Kwasi Kwarteng]

My hon. Friend will know that this is a critical point. There is always a balance between trying to decarbonise and making sure that energy bills are low to protect people. That is why we have a warm homes discount, which has worked very effectively. We have deployed money, and committed to that in the manifesto, with a home upgrade grant of about £2.5 billion. We are always looking at schemes not only to decarbonise, but to keep the costs low for those who are most vulnerable.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

One could be forgiven for thinking that COP26 is approaching and the Government need to make some headline announcements. What is missing in the Secretary of State’s statement today is a clear set of metrics against which this House, this country and the world can measure the Government. Will he take on board the thoughtful recommendations of the Public Accounts Committee, which said that he should report properly to this House with clear targets and metrics which we can hold him to? I know that he is a man of intelligence, and a man who is committed to this; if he is that committed, will he open up that scrutiny so that we can really hold the Government properly to account?

[Kwasi Kwarteng]

Let me declare an interest: I served under the hon. Lady’s chairmanship on the Public Accounts Committee and I am very grateful for the time that I spent on the Committee. Of course, I will treat the Committee with the respect and courtesy that are due it. I look forward, as do my officials, to being asked about any of the Government’s programmes in respect of the net zero agenda.

[Sir David Amess (Southend West) (Con)]

I welcome the commitment in the 10-point plan to achieve net zero carbon emissions by 2050, but we have very few electric vehicle charging points in Southend and many parking restrictions. We would very much like to see them on new builds and in people’s driveways. With petrol and diesel cars being banned by 2030, will my right hon. Friend please help us to get more of these charging points in Southend before we become a city?

[Kwasi Kwarteng]

That begs the question, when will Southend become a city? Leaving that to one side, of course I will help my hon. Friend achieve those goals. The electric charging point roll-out is perhaps the most important metric—the most important thing to do— in order to achieve our goals with respect to electric vehicles.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

Following on from the question of the right hon. Member for Tunbridge Wells (Greg Clark), there were some positive comments from the chief executive of Stellantis yesterday to the effect that things were moving in the right direction but we were not quite there yet. May I take this opportunity to remind the Secretary of State that Cheshire West and Chester Council and the local enterprise partnership have been working very closely with the civil servants over the past few months to make sure that the right deal is in place. They stand ready to do anything else they can to get this thing over the line, which is what we all want to see.

[Kwasi Kwarteng]

I am conscious of the work that the hon. Gentleman has done, as he put it, to get this over the line. I was gratified to see Mr Tavares’ comments yesterday and I think that we are in a reasonable place. We obviously need to work very hard together to get it over the line, but the situation in Ellesmere Port is moving in a positive direction.

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

I thank and welcome everything that the Secretary of State has said today. May I join the hon. Member for Aberdeen South (Stephen Flynn) in extolling the virtues and benefits of the Acorn project in the north-east of Scotland—of course headquartered in Banchory in my constituency—as being essential to our drive towards net zero? Does my right hon. Friend not agree that, if his Department were to choose this project, it, along with the energy transition deal, would demonstrate again to the people in the north-east of Scotland the value of remaining a part of our United Kingdom?

[Kwasi Kwarteng]

I am delighted to see this degree of cross-party fraternity on that. All I would say is that the Acorn project has a lot to recommend it.

[Stephen Farry (North Down) (Alliance) [V]]

The Government talk of a green industrial revolution, but surely they should be working through the concept of a green new deal bringing together attacking climate change and addressing social justice and job creation. On job creation specifically, how do the Government come to the figure of a quarter of a million new jobs by 2030, as many non-governmental organisations and think-tanks believe that the Government could be creating closer to 1 million jobs over the decade with the right policies of investment, with areas such as Northern Ireland achieving 50,000 more new jobs?

[Kwasi Kwarteng]

Of course, the number of jobs depends on the definitions that you use. The 250,000 number specifically relates to the measures in the 10-point plan. I am sure the hon. Gentleman will know, as he has been in the House for a while now, that as Energy Minister I always used to say that we have about 400,000 so-called green-collar jobs today and our target was for 2 million by 2030. That is a much wider range of jobs than those specifically created by the 10-point plan, and that is where there is a discrepancy in the numbers.

[Jason McCartney (Colne Valley) (Con)]

There is a lot of older housing stock in my constituency and I therefore fully support the Government’s aims to make our homes warmer and greener. I appreciate that there are issues with the green homes grant scheme, but will the Secretary of State commit to boosting investment in energy efficiency measures in our homes, because that will not only be good for the planet and good for residents in helping to reduce bills, but create tens of thousands of quality green jobs?

[Kwasi Kwarteng]

I fully appreciate my hon. Friend’s points. He and I stood on a manifesto in 2019 that expressly committed us to spending £9.2 billion over 10 years on exactly the kinds of measures that he mentioned. That is something that I am very focused on.

[Charlotte Nichols (Warrington North) (Lab) [V]]

Thousands of my constituents work in the nuclear sector, which only this week has seen students from Warrington University Technical College beginning prestigious degree apprenticeships at Sellafield in Warrington—proof that the sector is a vital partner in the skills and levelling-up agendas, meeting our decarbonisation goals and creating high-quality green jobs. The Government have rightly concluded that we need much more nuclear power in the mix to reach net zero. However, under their watch, three large-scale nuclear projects have been abandoned due to the lack of a financing mechanism, which the Government claim to have been working on for four years. Why is nuclear financing more complicated than nuclear science?

[Kwasi Kwarteng]

I do not think it is. The hon. Lady will remember that the third of the Prime Minister’s 10 points was expressly committed to nuclear power. I was very pleased, as Energy Minister, to visit the nuclear college at Hinkley Point. I am sorry that I did not manage to go to Sellafield. We are completely committed to this, and we will bring forward in this Parliament legislation that will further commit us to creating more nuclear power in this country.

[Simon Fell (Barrow and Furness) (Con)]

The 10-point plan recognises the immense value of local jobs in offshore wind production—something that my constituents are anticipating as Barrow and Furness is the home of the second-largest wind farm in the world. However, wind is not the only crucial renewable energy source in Cumbria: nuclear is hugely important and, as the hon. Member for Warrington North (Charlotte Nichols) said, we are reliant on it. With that in mind, will my right hon. Friend update the House on the financing policy that sits behind this to enable these jobs to be created?

[Kwasi Kwarteng]

My hon. Friend will realise that sensitive discussions are being held all the time, but I refer him back to my answer to the previous question. The third point of the Prime Minister’s 10-point plan was all about nuclear power. It said explicitly that we are committed to having a decision on a plant before the end of the Parliament. We are in conversations with operators and developers—very fruitful conversations, I might add—to bring that about, and we have an ongoing commitment to increasing, not decreasing, capacity in nuclear power.

[Tahir Ali (Birmingham, Hall Green) (Lab) [V]]

Does the Secretary of State agree that wide-scale housing insulation is key to bringing down household emissions? If so, can he explain what possible rationale he had for axing the green homes grant scheme? Will he take this opportunity to publicly apologise to the businesses affected by the shambolic delivery of the green homes grant schemes, including those businesses that his Department failed to pay for the work that was carried out under the scheme in good faith, some of whom were reportedly forced to make staff redundant?

[Kwasi Kwarteng]

The accusation that BEIS somehow did not pay people who worked on the scheme is a very serious one and I need to investigate it. I do not think that was the case but, as I said, I will investigate.

As I have mentioned, the green homes grant was composed of three elements. One was the decarbonisation of public sector buildings through Salix, the public finance body, and another relied on local authorities to distribute funds to enhance social housing and decarbonise those buildings. Both those elements were successful. The other element related to owner-occupiers. It was a short-term scheme that was always designed to end at the end of March, which it did, and we are looking to develop a replacement.

[Cherilyn Mackrory (Truro and Falmouth) (Con) [V]]

Falmouth boasts the deepest natural harbour in western Europe and it is well placed to play a leading role in the UK’s ambition to deploy a gigawatt of FLOW—floating offshore wind—capacity by 2030. FLOW deployment in the Celtic sea alone could create more than 3,000 jobs. Local universities and the private sector have come together to accelerate deployment with a Strength in Places fund application. Will the Secretary of State visit the port of Falmouth with me—perhaps while he is in Cornwall next month—to see the exciting plans for ensuring that Cornwall is at the heart of this emerging sector?

[Kwasi Kwarteng]

I am not sure which is coming first—St Ives or Falmouth—but I am sure that arrangements can be made for such a visit.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State for his statement. Will he please outline how the intended £12 billion of Government investment—with potentially three times as much from the private sector—to create and support 250,000 green jobs will be distributed throughout the United Kingdom? In particular, what will happen in Northern Ireland, which currently seems to be increasingly outside of the UK plan but has the potential to play a tremendous role—for example, at Harland & Wolff in Belfast and, indeed, other booming sites of industry throughout Northern Ireland—in achieving our industrial revolution?

[Kwasi Kwarteng]

I am delighted that the hon. Gentleman has brought that question up. He will know that I speak regularly to my right hon. Friend the Secretary of State for Northern Ireland and the Minister of State, Northern Ireland Office, my hon. Friend the Member for Worcester (Mr Walker), about investment in Northern Ireland, particularly in relation to net zero. The hon. Gentleman will know about the offshore wind opportunities in Northern Ireland, I am particularly excited about the opportunities for hydrogen, and he will also know about the operation of Wrightbus and its efforts to bring hydrogen into the transportation system. There are exciting opportunities for Northern Ireland in relation to the net zero 10-point plan and I would be happy to discuss them with the hon. Gentleman.

[Mr Mark Harper (Forest of Dean) (Con)]

I listened carefully to what the Secretary of State said about the paper he is going to produce this year on heating buildings and about point 2 of the plan, on the hydrogen strategy. Will he make sure that the plan properly recognises that significant numbers of homes, including in my constituency of Forest of Dean, are not on the gas grid, and that we need solutions that work for the people who live in them so that they can have what they want, which is greener heating for their homes that is affordable and deliverable on the necessary timescale?

[Kwasi Kwarteng]

My right hon. Friend will know that in the United Kingdom we have an extremely diverse range of buildings and dwellings, which means that a one-size-fits-all policy just does not work for energy in the UK. There are lots of ways in which we can decarbonise buildings, which is exactly what will be spelled out in the heat and building strategy and—to a lesser degree, but more focused on hydrogen—in the hydrogen strategy. I would be happy to discuss with my right hon. Friend what we are doing to ensure that his constituents who are off the grid can get cheap, affordable green energy.

[Mr Deputy Speaker (Mr Nigel Evans)]

I thank the Secretary of State for his statement and for responding to the 20 questions. I wish him well for his extensive tour of Cornwall.

Contingency Liability Notification: Baglan Operations Limited and Baglan Group Companies

Kwasi Kwarteng Excerpts

Tuesday 20th April 2021 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I am tabling this statement for the benefit of hon. and right hon. Members to bring their attention to the details of a contingent liability following the provision of an indemnity from the Department of Business, Energy and Industrial Strategy to the Official Receiver acting in the insolvency of Baglan Operations Limited (BOL) and the wider Baglan Group companies.



It is normal practice when a Government Department proposes to undertake a contingent liability of £300,000 and above, for which there is no specific statutory authority, for the Department concerned to present Parliament with a minute, giving details of the liability created and explaining the circumstances.



BOL entered liquidation on 24 March 2021 and owns a site hosting a gas generation plant—now closed—and operates a private wire which provides electricity to the Baglan Energy Park in Port Talbot. The energy park accommodates various businesses—primarily a paper product manufacturer, Intertissue—public sector buildings —local authority offices and a NHS medical centre—and a water pumping station.



The departmental minute I lay today is to notify Parliament retrospectively of the provision of an indemnity to the OR.



Departmental officials and I are aware of the presence of several chemical substances at the site that will require safe disposal. There is also a gas plant and 12 km of pipeline that will require decommissioning. BOL supplies the electricity through a private electricity wire, which is exempt from being licensed. As it is licence-exempt, BOL is not capable of being covered by the energy regulator Ofgem’s supplier of last resort arrangements or any energy special administration regime.



My Department has been monitoring this fast-moving situation since December 2020, working closely with the Welsh Government, Wales Office, the Insolvency Service, UK Government Investments (UKGI) and HM Treasury.



My Department has provided the OR with an indemnity in respect of:



carrying out the proper performance of the OR’s duties as liquidator of the Baglan Group companies;

seeking the appointment of, engaging and instructing the special managers in respect of the Baglan Group companies; and

maintaining, securing and funding the ongoing operation of the Baglan Group companies undertakings, and distributing the assets of the companies in the ordinary course of the OR’s duties as liquidator of the Baglan Group companies.

HM Treasury has approved the proposal and I will be laying a departmental minute today containing a description of the liability undertaken.

[HCWS925]

UK Steel Production: Greensill Capital

Kwasi Kwarteng Excerpts

Thursday 25th March 2021 Commons Chamber

[Lucy Powell (Manchester Central) (Lab/Co-op)]

(Urgent Question): To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make a statement on the future of UK steel production following Greensill Capital’s recent insolvency.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

As many right hon. and hon. Members will be aware, it would not necessarily be appropriate for me to comment on commercially sensitive matters at this stage. However, I do appreciate that many Members of this House have expressed concerns to me, individually and in groups, about their constituents working in the steel industry and the families and workers that the industry supports.

Following Greensill Capital entering into administration on 8 March, I and the Department continue to follow developments very closely. As many hon. Members know, I have directly spoken to local management on a number of occasions, and I have also spoken to representatives of the trade unions—as recently, in fact, as yesterday evening. On all those occasions, I have seen a strong and united commitment across management, across the unions and certainly among officials in my Department. I have seen a united commitment to the workforce and our steel industry.

[Lucy Powell]

The Secretary of State has been dragged here to finally say something, because earlier in the week he had nothing to say. I do not expect him to disclose commercial information, but it is in the commercial interests of UK plc and the customers, suppliers and workers in Rotherham, Stocksbridge, Hartlepool, Scunthorpe, Newport and elsewhere to know whether the Government will step in if Liberty fails to refinance.

We have called for a plan B. It is in our national interests for all options to be on the table. Those options should not be blinkered by ideology, because domestic steelmaking is a cornerstone of our national security and economic prosperity. What is more, Liberty Steel businesses are viable and have made the switch to electric arc furnaces, at great cost. Can the Business Secretary confirm that he is considering all options, from immediate support—if due diligence is met—to public ownership, should the business fall into administration? Does he agree that nationalisation could be the best value-for-money option, especially when we look at British Steel, which the Government spent £500 million on and then sold off on the cheap to the Chinese?

Let us be honest: UK steel and steel communities have been betrayed by this Government, because they have no vision nor any plan. There was not a single mention of steel in the Secretary of State’s plan for growth. There has been very little sector support during covid. The clean steel fund keeps being kicked up the road. There has been no action, despite promises, on the crippling issues of high energy prices and business rates. There is no buy-British guarantee in Government contracts. He just scrapped the industrial strategy. It is no wonder that the investment climate in UK steel is so uncertain. Will he finally take this opportunity to set out his vision and plan the future of UK steel?

--- Later in debate ---

[Kwasi Kwarteng]

I appreciate that questions are getting very long in this House.

[Mr Speaker]

Order. I think I am the judge of that. The Secretary of State may be new to the Dispatch Box in his new position, but the Opposition are entitled to two minutes, and the hon. Member for Manchester Central (Lucy Powell) was within that time. Please, let me make those judgments.

[Kwasi Kwarteng]

I am very happy to defer to you, Mr Speaker; I have huge regard for your position, as I have mentioned many times. With respect to the remarks of the hon. Member for Manchester Central (Lucy Powell) about my being dragged back to the Dispatch Box, that is not the case at all. As she knows, I was the Secretary of State who reconstituted the Steel Council on 5 March. That was a top priority for me, because I feel that we have a future for UK steel: the Government’s infrastructure plans will need around 5 million tonnes of steel over the next decade. It is absolutely a commitment of mine, as Secretary of State, to ensure that we have a viable steel industry in this country.

[Dr Jamie Wallis (Bridgend) (Con) [V]]

In 1998, 234 jobs were lost at a steel mill in Darlington. In 2001, the Llanwern steelworks closed, with 1,300 jobs gone. In 2003, 95 jobs were lost at the Shotton site in Deeside, and 116 at the Avesta site in Panteg. In 2004, we lost 156 jobs in Scunthorpe and a further 80 in Lincolnshire. In 2006, two closures led to losses of 250 jobs and 40 jobs. Of course, in February 2010, Teesside Cast Products was mothballed, putting 2,400 jobs at risk. Does my right hon. Friend agree that, with the Opposition’s abysmal record on steel, the Government are right to discard their failed vision and continue with our proactive approach to helping the sector?

[Kwasi Kwarteng]

My hon. Friend is absolutely right. What devastated the steel industry was, as we know, 13 years of Labour Government. We have made it very clear, with our industrial decarbonisation strategy, published only last week, that we remain committed to a UK steel industry and a decarbonised future, and also to green jobs, particularly in in our levelling-up agenda.

[Mr Speaker]

I call the SNP spokesperson, who has one minute.

--- Later in debate ---

[Kwasi Kwarteng]

The hon. Gentleman makes a very fair point, and he will be pleased to learn that I have spoken to representatives of the Scottish Government. We have mutual and very strong interests in the ongoing future of the businesses under the GFG umbrella, and he will know that my door is always open to conversations with him and his counterparts in the Scottish Government to see a way through. As far as specifics of Government intervention, I have said repeatedly that it is not appropriate now, given where we are, for me to disclose anything of that kind, but of course this is an ongoing situation that we are monitoring extremely closely.

[Jacob Young (Redcar) (Con)]

I thank the Secretary of State for his statement, for his recent visit to Teesside and for all he is doing to support the industry at this difficult time. Under the last Labour Government, steel production in this country fell by almost 50%, so we should take no lectures from Labour on this. In Redcar, we lost our blast furnace in 2015 with the closure of SSI, but the only reason we have any steel manufacturing left at all is that the Government stepped in and saved British Steel at Lackenby and Skinningrove. Will the Secretary of State confirm that he will address key industry concerns such as energy pricing, that he will champion the UK steel charter and that it is our policy to increase domestic steel production, and will he work with me and Ben Houchen on a new electric arc furnace for Redcar?

[Kwasi Kwarteng]

I commend my hon. Friend, who, only in his brief time as a Member of Parliament, has made a real impact on these discussions and in representing Redcar. I remember a Redcar that was represented by a Liberal Democrat precisely because of the closure of the SSI plant, and I am delighted to see that it is now represented by an excellent Conservative MP.

[Sarah Olney (Richmond Park) (LD) [V]]

The circumstances surrounding the collapse of Greensill Capital throw up a lot of questions about how decisions are being made regarding the use of public money to guarantee loans to struggling companies during the pandemic. It is important that Parliament has sight of those decisions to properly scrutinise them. On 12 November 2020, in response to a parliamentary question tabled by the shadow Minister for the Cabinet Office, the hon. Member for Leeds West (Rachel Reeves), a Department for Business, Energy and Industrial Strategy Minister said that the list of companies offered coronavirus business interruption loans would be published “in due course”. Does the Secretary of State agree that transparency is essential for effective scrutiny, and will he commit to publishing the list of companies that have received Government-backed loan support without delay?

[Kwasi Kwarteng]

I will certainly look into the hon. Lady’s request. This is something that has been brought to my attention and I will try to see if we can publish something soon.

[Duncan Baker (North Norfolk) (Con) [V]]

It is absolutely right to support the steel industry, given the jobs and the simple fact that steel is a fundamental material in our construction industry, and the Government do. I am sure the Secretary of State will note my Environmental Audit Committee inquiry looking at sustainable building materials for the future, such as engineered wood, which is stronger than steel and embodies carbon. Does he agree that we must explore these avenues alongside supporting existing industries as we transition to a greener economy?

[Kwasi Kwarteng]

I welcome my hon. Friend’s report and his contribution to the debate around the green industrial revolution. He is absolutely right that, alongside steel, we should consider all forms of innovative and novel materials—advanced materials—that can help us build back greener and more sustainably.

[John Spellar (Warley) (Lab)]

The three fleet solid support ships, at 40,000 tonnes, are equivalent in size to the two aircraft carriers. That is a lot of steel. Only this week, the Ministry of Defence finally conceded that they will be designated as naval vessels, meaning that they will be built in British yards. When the Secretary of State goes back to his office, will he get on to the Defence Secretary and tell him they must also be built with British steel?

[Kwasi Kwarteng]

I admire and am always impressed by the right hon. Gentleman’s passion for these issues, and I think he is absolutely right. We do have a need for huge amounts of steel in infrastructure in this country. That is why I have said repeatedly that there is a future for the steel industry in the UK.

[Shaun Bailey (West Bromwich West) (Con) [V]]

Obviously, steel is also a crucial part of this Government’s decarbonisation strategy. Can my right hon. Friend reassure my constituents in Oldbury, where a Liberty Steel site is currently based, that he will ensure that Black Country steel is placed at the heart of that decarbonisation strategy and that they will get the support they need from the Government as we go through this difficult time for Liberty Steel Group?

[Kwasi Kwarteng]

I assure my hon. Friend that we are committed to the steel industry in the UK. That is why, last week, we published the industrial decarbonisation strategy, which I was very pleased to commission as energy Minister. I look forward to speaking to him about the next steps forward for this industry.

[Stephen Kinnock (Aberavon) (Lab) [V]]

British steelworkers make the best steel that money can buy, but they are having to compete with one hand tied behind their back because electricity costs our steel companies 86% more than in Germany and 62% more than in France, an issue I raised with the Secretary of State when he met steel MPs on 3 February. On 22 February, the Prime Minister told me from the Dispatch Box that

“we must indeed address the discriminatory costs of energy.”—[Official Report, 22 February 2021; Vol. 689, c. 647.]

What progress has the Secretary of State made in addressing this critical issue since our 3 February discussion, and does he think that the Chancellor understands that there can be no post-pandemic recovery without a strong and healthy steel industry?

[Kwasi Kwarteng]

My right hon. Friend the Chancellor is fully aware of the importance of the sector. The hon. Gentleman will know—I think he attended the Steel Council where this issue was raised—that we have commissioned work to see what can be done to redress the balance he alludes to.

[Holly Mumby-Croft (Scunthorpe) (Con) [V]]

I was really pleased to hear the Prime Minister speak yesterday about the opportunities he sees for British steelmakers in major projects such as HS2. Can my right hon. Friend provide more information on that and can he—I know it is difficult—reassure the Liberty Steel workers in Scunthorpe that the Government will do all they can to support them?

[Kwasi Kwarteng]

I would like to reassure my hon. Friend. My right hon. Friend the Prime Minister was absolutely right to say that we need a huge amount of steel—about 5 million tonnes—over the next decade and that this Government are committed to an ongoing steel industry. As she knows, I have spoken to local management and workforce representatives, and we are doing all we can to look at all options to make sure that this vital piece of infrastructure continues and remains a going concern.

[Geraint Davies (Swansea West) (Lab/Co-op) [V]]

We know that David Cameron was an adviser to Greensill Capital, with shareholdings of potentially tens of millions of pounds, and that he made private texts and calls on a number of occasions to the Chancellor to help secure funds for Liberty before Greensill, a high-risk company, went bust, putting thousands of jobs at Liberty Steel at risk. What investigation will BEIS carry out? Will the Secretary of State ensure that in future taxpayers’ money is no longer interfered with by David Cameron and former Conservative Ministers, but is instead invested directly to protect our jobs in British steel and other vital industries?

[Kwasi Kwarteng]

The hon. Gentleman will know that officials often meet with a range of businesses affected by policy changes—that is part of policy development—but it is always done with proper and due consideration.

[Angela Richardson (Guildford) (Con)]

A key part of our efforts to drive long-term green growth is to support workers in high-carbon sectors such as steel to retrain in new green technologies. Does my right hon. Friend agree that upskilling and retraining workers will be integral to our efforts to level up opportunity right across the country?

[Kwasi Kwarteng]

I am delighted to relate to my hon. Friend that she is absolutely right. We need to retrain people in new green technologies, which is precisely why I, as energy Minister, with my hon. Friend the Member for Chichester (Gillian Keegan), set up the green jobs taskforce to look at exactly the requirements and skills we need to drive the green industrial revolution.

[Peter Grant (Glenrothes) (SNP) [V]]

We know that Greensill was a major financer of the Gupta Family Group and, understandably, the questions today have focused on the employment concerns that its workers might have, but we do not know what other businesses may have relied on financing from Greensill and been affected. When does the Secretary of State expect to have that information fully pulled together, and can he undertake, as far as is allowed by commercial confidentiality, to keep Members of Parliament informed of any other businesses that might be at risk as a result of the collapse at Greensill?

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[Kwasi Kwarteng]

The hon. Gentleman makes a legitimate point. The collapse of a company like Greensill has ramifying effects, and I, Ministers and officials in the Department are looking closely at the potential impact.

[Nicola Richards (West Bromwich East) (Con) [V]]

I thank my right hon. Friend for his personal engagement with me on this issue and for acting so quickly. Liberty Steel is a big employer in the Black Country and we have been hit particularly hard by the worst effects of the pandemic. I know that he needs no convincing about the importance of the steel industry in our part of the west midlands, so will he continue to prioritise this issue and work with me to help protect jobs in West Bromwich East?

[Kwasi Kwarteng]

I would be very happy to work with my hon. Friend to protect jobs. She is doing a great job of representing her constituents. All I would say on this is that we published last week the industrial decarbonisation strategy, which is the first of its kind in the world, and we are absolutely committed to a continuing future for British steel.

[Nick Smith (Blaenau Gwent) (Lab)]

Liberty Steel has a diverse portfolio with a long supply chain. These jobs are often trade-unionised, so they have better pay. Losing them will have a big impact across our country. How will the Secretary of State protect the different elements of this complex company, such as the tubing plant in Tredegar in my Blaenau Gwent constituency, with its loyal and skilled workforce who have kept it going through tough times?

[Kwasi Kwarteng]

The hon. Gentleman is quite right. The company has a range of assets spread across England and Wales, in particular, and we are looking very closely at what specific assets and jobs are necessary. We hope to support the company in its entirety.

[Miriam Cates (Penistone and Stocksbridge) (Con) [V]]

The funding challenges faced by Liberty are serious, but I have been reassured by meetings with my right hon. Friend, and by the Prime Minister’s response to my question yesterday, that the Government are committed to doing whatever is possible to safeguard jobs and livelihoods in the UK steel industry. However, in the longer term, for steelmaking to thrive in the UK, we must make sure that UK infrastructure projects use environmentally friendly UK steel, providing well-paid jobs and helping to level up. Will my right hon. Friend assure me that future procurement processes will favour British steelmakers such as Speciality Steels in Stocksbridge?

[Kwasi Kwarteng]

I reassure my hon. Friend, whom I have met on several occasions on precisely this issue, that we remain committed to decarbonised steel and a decarbonised industrial strategy, which I have referred to. That is the basis on which we can have a strong future for the industry.

[Sarah Champion (Rotherham) (Lab) [V]]

The Secretary of State is well aware that Liberty in Rotherham employs 900 people, along with five times that number in the local supply chain. Our steel goes into defence, energy, aviation—all key strategic industries. In this post-Brexit world, will the Secretary of State please make a commitment that all Government procurement projects using steel will commit to buying British steel for them, because a full order book is the best way to see a future for steel in this country?

[Kwasi Kwarteng]

On procurement, I want to relay to the hon. Lady that we have constructed in government a UK Steel and BEIS Procurement Taskforce, which met for the first time only a couple of weeks ago, on 12 March, chaired by my noble Friend Lord Grimstone. We are absolutely committed to seeing what we can do to make sure that we have a strong steel industry in this country that will support the huge infrastructure needs that our country has in the next decade.

[John Redwood (Wokingham) (Con) [V]]

I strongly support all the measures that the Government will be taking to ensure that public orders concentrate on UK-made steel, where that is possible, but what further measures can the Secretary of State take to ensure that energy prices are realistic and competitive? If we have very dear energy in this country, it will be a major problem for our steel industry.

[Kwasi Kwarteng]

My right hon. Friend is absolutely right to point to electricity and energy costs. I am in regular contact with my right hon. Friend the Chancellor to see what can be done, as my right hon. Friend the Member for Wokingham (John Redwood) said, to address that problem.

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

The Greensill affair raises the issue not just of Liberty Steel’s refinancing but of ex-Prime Minister David Cameron bending the ear of the now Chancellor, although he was not on the lobbying register. With ex-Minister Eric Pickles overseeing the body regulating current Ministers’ interests, how can the Government ensure transparency on conflicts of interest when they seem to operate a culture of friends with benefits and mates’ rates, with British steel jobs being mere collateral?

[Kwasi Kwarteng]

Obviously, I completely reject the hon. Lady’s characterisation of what goes on. She will know that officials often meet huge numbers of business people who are affected by policy. That is part of policy development, but it is always done in a transparent, open and proper way.

[Julie Marson (Hertford and Stortford) (Con) [V]]

The Labour party talks about vision. Does my right hon. Friend agree that this Government’s commitment to net zero and their clear vision of being a technology-led innovation superpower, as demonstrated by initiatives such as the Clean Steel Fund, the Advanced Research and Invention Agency, and the Future Fund: Breakthrough, mean that the future of UK steel is positive and in very good hands?

[Kwasi Kwarteng]

Obviously, I entirely agree with everything that my hon. Friend has said. Reflecting on two years as a Minister within the Department, I can tell her that we have had the 10-point plan for the green industrial revolution, the Energy White Paper, the decarbonisation industrial strategy, and, as she says, we have committed hundreds of millions of pounds to making sure that we drive the green industrial revolution. It is a very exciting time to be in Government and I look forward to speaking with her precisely about how we can move forward.

[Marion Fellows (Motherwell and Wishaw) (SNP) [V]]

With booming metal prices, GFG’s business in Scotland, including Liberty Steel in my Motherwell and Wishaw constituency, remains profitable. Notwithstanding his previous answers, I must press the Secretary of State to echo the promise given by the Scottish Government and do all in his power to protect this profitable industry. Will he do so?

[Kwasi Kwarteng]

That is a fair question, but the hon. Lady will appreciate that the assets in Scotland relate particularly to aluminium smelting, whereas in England and Wales their job is really focused on the steel industry. None the less, we are looking at all options to see what we can do to sustain these crucial jobs.

[Richard Fuller (North East Bedfordshire) (Con)]

An acquisition strategy based on supply chain financing arrangements, plus a future receivables derivative scheme, plus an additional month’s cash-flow, and a liberal mix of state guarantees has the characteristics of a potential Ponzi scheme. Has my right hon. Friend been able to ascertain the facts here, or is this an issue for investigation by the Serious Fraud Office?

[Kwasi Kwarteng]

My hon. Friend raises very serious questions about the business model, which I am not prepared to go into now. What I will say is that, in the first two months of my tenure as Secretary of State, I have pushed forward audit reform as a big issue. A consultation on it is under way. It is issues relating to things such as Greensill capital that show how necessary it is for us to reconsider what we are doing on audit reform and to have the best standards in the world.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

I think we all understand the importance of commercial confidentiality, but, where significant sums of taxpayers’ money are concerned, that cannot not be a barrier to full accountability. The Secretary of State will be aware that the Scottish Government are out for guarantees north of £500 million as a consequence of Greensill’s difficulties. Is that not something for which there really ought to be full explanations?

[Kwasi Kwarteng]

The right hon. Gentleman is absolutely right. My understanding is that the Scottish Government are very exposed to Greensill’s financial engineering—let me put it that way—and there should be far greater transparency in this regard.

[Antony Higginbotham (Burnley) (Con)]

A strong domestic steel industry is vital to so much of what the Government do, from frigates and submarines to schemes such as HS2. With that in mind, may I ask the Secretary of State whether he will work with colleagues across all of Government—not just with the Treasury, but with the Ministry of Defence and the Transport Department—to ensure that we protect this strategic sovereign capability?

[Kwasi Kwarteng]

My hon. Friend is absolutely right. It is crucial that we work across Government to look at procurement and the strategic interests of this country in having a strong steel industry, as he describes, and in order to work out how best to progress with this key sector.

[Lilian Greenwood (Nottingham South) (Lab) [V]]

Investing in transport infrastructure such as the full HS2 route and a rolling programme of rail electrification is an excellent way to boost economic recovery and put the UK on the path to net zero, but the Government will be wasting a huge opportunity to safeguard and grow jobs in our steel industry if they do not use public procurement to support it. Will the Secretary of State commit to setting targets for UK steel content in contracts for major public works, and if not, why not?

[Kwasi Kwarteng]

The hon. Lady will know, as I have said at the Dispatch Box today, that we have a taskforce in BEIS chaired by my noble Friend Lord Grimstone. This is absolutely something that we are looking into, given the huge need we have and the huge demand for steel products in our infrastructure plans.

[Theresa Villiers (Chipping Barnet) (Con) [V]]

For all the many reasons set out by Members today, retention of a domestic steel industry is vital for our economy and our security. Will the Secretary of State set out what he is doing to ensure that we have the right regulatory climate for steel to thrive? Will he commit that, if other countries dump steel on world markets that has been inappropriately subsidised, he will take action via our trade policy to introduce anti-dumping measures to protect and support our steel industry?

[Kwasi Kwarteng]

My right hon. Friend will know that the steel industry in particular is subject to fairly stringent World Trade Organisation rules. She will also know, given the publication of our industrial decarbonisation strategy, that we are rigorously focused on trying to source clean, green steel in order to drive a green industrial revolution and to create the infrastructure projects without which we cannot have any real economic growth.

[Charlotte Nichols (Warrington North) (Lab) [V]]

Last year, the Government spent £4.8 billion on subsidies for wind power, yet almost no wind farms use UK steel. Those orders would be a boon to the struggling steel industry, but the Department does not even include renewable energy products in its annual list of orders that went to domestic suppliers. In January, the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Stratford-on-Avon (Nadhim Zahawi), said that the Government would consider reporting the share of UK steel used in offshore wind projects

“if it is in the public interest.”

Will the Secretary of State accept that it clearly would be in the public interest to name and shame the developers that do not use UK steel, and will he commit to making that change?

[Kwasi Kwarteng]

The hon. Lady will appreciate that, as part of the offshore wind sector deal, we have explicitly said that 60% of the supply chain should be UK-sourced, and clearly steel is a big part of that supply chain. She will also appreciate that, as Energy Minister, I made it a priority to ensure that in the fourth auction round at the end of this year, these targets will be met. Steel is part of that, and we are absolutely committed to having more UK content in the supply chain for offshore wind.

[Mr Richard Holden (North West Durham) (Con)]

Being in the European Union prevented us from prioritising British steel, despite steel and its component parts being strategic resources. Now that we have left, will the Secretary of State prioritise British steel, at least in Government procurement? Will he ensure that steel and its component parts are, where possible, protected and bought from UK producers to prevent us being strategically vulnerable in the future?

[Kwasi Kwarteng]

I pay tribute to my hon. Friend—another Conservative who won a so-called red wall seat. He has done a fantastic job in representing his constituency, particularly on this critical issue. From my answers, he will know that we are committed to making sure that UK steel has a big part to play in the construction and infrastructure plans that we ambitiously set out.

[Jonathan Edwards (Carmarthen East and Dinefwr) (Ind) [V]]

Tata Steel has reportedly said that it is in active discussions with the British Government about creating a “decarbonised footprint” for the future, especially in Port Talbot. While I welcome that, will the Secretary of State confirm that at the heart of those strategies, the British Government will prioritise maintaining volume of production and jobs in the Welsh steel industry?

[Kwasi Kwarteng]

The hon. Gentleman will know, but I say in the interests of transparency, that one of my first meetings when I was appointed Secretary of State was with the head of Tata Steel. He will also know that having visited Hinkley Point as Energy Minister I am fully aware of the impact and the contribution that the Tata plant makes to infrastructure. I am sure he will be pleased to hear that this is a top priority of mine. I have made the point many times this morning that our infrastructure plans are absolutely intertwined with a strong domestic steel industry.

[Bob Stewart (Beckenham) (Con)]

I am very sorry I was late for the start, Mr Speaker, but I was having a rather shouted conversation with the Chief of the General Staff about the massive cut of 12% in our Army, and particularly the loss of my battalion—

--- Later in debate ---

[Mr Speaker]

No, I think it will be with the Chief Whip later.

[Kwasi Kwarteng]

I am very pleased to see my right hon. Friend in his place. The key point is that Liberty Steel produces via electric arc furnaces, so it is clean steel. A lot of the steel that we produce relies on older methods. That is why, for me, in terms of our decarbonisation strategy, the future of Liberty Steel is of great importance.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

For national security reasons, to tackle the climate crisis, and to build our rail infrastructure, electric vehicles and the like with well-paid unionised jobs, domestic steel production must be a strategic national priority. However, time and again the Government have let down Britain’s steel industry. On their watch, we have seen British Steel collapse, minimal action taken to tackle the huge handicap of high energy prices for our steelmakers, and an over-reliance on imported steel for Government projects. Prior to Brexit, the excuse for the lack of Government intervention was EU state aid rules. What is the excuse now?

[Kwasi Kwarteng]

There is no “excuse now”. I am afraid that the hon. Gentleman lost me rather when he said that the Government have done nothing. We have heard from all around the House the devastating impact of the last Labour Government on the steel industry. I even took a question from an extremely able Conservative Member, my hon. Friend the Member for Redcar (Jacob Young), whose seat was represented by a Liberal Democrat, because of the debacle around the closure of SSSI.

[Gary Sambrook (Birmingham, Northfield) (Con)]

I welcome my right hon. Friend’s decision to re-establish the Steel Council. Does he agree that this is a perfect opportunity for the Government to work in partnership with the industry so that we can create a long-term, sustainable plan to ensure the sector’s transition to a low-carbon future?

[Kwasi Kwarteng]

I am delighted that my hon. Friend has mentioned the Steel Council. I remind right hon. and hon. Members that the Steel Council last met in February 2020. It was a first priority of mine, on becoming Secretary of State, to have another meeting, so we had a meeting on 5 March that went extremely well and is a solid basis for our ongoing dialogue with the sector not only among employers but among union representatives. It is an excellent body and I look forward to working very closely with it in the months and years ahead.

[Mr Clive Betts (Sheffield South East) (Lab) [V]]

I am sure the Secretary of State will recognise that Sheffield is the home of steel. Stainless steel was invented in Sheffield, steel made in Sheffield is famous not merely in the UK but throughout the world, and thousands of Sheffielders still work in the steel industry and in related industries as well. So will he give an absolute assurance that the term, “Steel made in Sheffield”, will not be consigned to the history books?

[Kwasi Kwarteng]

It certainly will not be consigned to the history books. We have an excellent firm in Sheffield, Forgemasters, among others. We all know the great history and traditions that Sheffield embodies and its vital role in the development, and the birth, really, of the steel industry worldwide.

[Andrew Griffith (Arundel and South Downs) (Con) [V]]

On behalf of manufacturers in my constituency relying on specialist grades of steel, I thank my right hon. Friend for his Department’s work to support UK steel and ask him to keep working with the industry so that we can be leaders in green steel production as we transition to a low-carbon economy.

--- Later in debate ---

[Kwasi Kwarteng]

I commend my hon. Friend’s work in representing COP26 and doing a great job in engaging with businesses on COP26. I assure him that green steel is very much at the front of our minds. It is something that I am very focused on. We have mentioned the Steel Council, and I have also mentioned a number of times the industrial decarbonisation strategy. Green steel is absolutely the way forward, and I look forward to working with him to see how we can make progress in this vitally important area.

[Dame Angela Eagle (Wallasey) (Lab) [V]]

Can the Secretary of State explain why Greensill—an unregulated shadow bank with close links to the Conservative party—was given access to the coronavirus large business interruption loan scheme, which is backed by 80% taxpayer guarantees? Following its collapse, which puts the future of Liberty Steel and thousands of jobs at risk, will the Minister practise the transparency he has just been talking about and tell the House how many millions of pounds of losses incurred will end up being dumped on the UK taxpayer?

[Kwasi Kwarteng]

The right hon. Lady will know that I cannot possibly comment on that, because it is part of an ongoing series of discussions. We do not really know the full extent of the impact of Greensill’s collapse on the British economy. We are looking into it very closely and looking at which companies have been affected, but until that further investigation we cannot possibly comment on the extent of the liability.

[Felicity Buchan (Kensington) (Con)]

One of the lessons of the pandemic has been that we need a robust domestic industrial strategy and we cannot be dependent on imports—either of final products or through the supply chain—from China or anywhere else. Does my right hon. Friend agree that steel is an integral component of that industrial strategy—and, with time, decarbonised steel?

[Kwasi Kwarteng]

I reassure my hon. Friend that the fact that we published the industrial decarbonisation strategy only last week suggests to me, and is a signal to the world of, how seriously we take the strategic impact and necessity of steel, and the net zero commitment.

[Dave Doogan (Angus) (SNP) [V]]

We know that David Cameron used his direct line to contact the Chancellor regarding Greensill’s difficulties. However, when did current UK Government Ministers first become aware of the firm’s difficulties? What actions were taken beyond acting on unsolicited advice from a former Prime Minister? And how will the Government categorically ensure the industry’s future and the thousands of jobs that go with it?

[Kwasi Kwarteng]

There were a lot of questions there. Briefly, on Greensill, we are continually looking at the potential impact. I must say to the hon. Gentleman that we are committed to a future for the steel industry here in the UK. As hon. and right hon. Members have suggested, the decarbonised nature of that sector—green steel—is absolutely the focus and at the front of our minds as we try to forge a path for the industry in the near future.

[Alexander Stafford (Rother Valley) (Con) [V]]

I thank the Secretary of State for meeting me to discuss the issues around Liberty Steel and for working with me to save jobs in that great company. He knows as well as I do that good British steel—and, hopefully, Sheffield steel—is an essential component of our ongoing green industrial revolution, from electric cars to wind turbines. Will he assure my constituents that there is a place and a need for the steel industry, and for many, many steel jobs here in South Yorkshire?

[Kwasi Kwarteng]

I am delighted to see my hon. Friend taking part in these critically important proceedings. I know how hard he has worked not only to win his seat and be an excellent, first-rate Member of Parliament, but also in his passion for green energy, renewable technologies and hydrogen; in fact, I am surprised that he did not mention hydrogen in his question. I am delighted to work with him to ensure that we have a future for the steel industry here in the UK.

[Rachel Hopkins (Luton South) (Lab) [V]]

Tackling emissions from steel is critical to the fight against climate change, and I have heard the Minister refer to green steel. The clean steel fund was announced in 2019, but steelmakers will not be allocated any funding from the £250 million scheme until 2023. Why will Ministers not bring forward this funding to boost the industry and its green future?

[Kwasi Kwarteng]

As the hon. Lady knows, we are always looking at ways in which we can promote green steel and industrial decarbonisation. I have alluded many times to the fact that we published the strategy last week, and the steel fund is clearly part of that strategy.

[Mr Philip Hollobone (Kettering) (Con)]

British-made steel, British electric car manufacture and British-backed clean growth: would my right hon. Friend agree that the prospects for all three are stronger and brighter now that we have left the European Union?

[Kwasi Kwarteng]

My hon. Friend will remember that I was a Minister in the Department for Exiting the European Union, as I think it was called. I do not want to revisit those debates, but I will say that the future of our industrial strategy, in terms of our green commitments, in terms of the steel commitments and in terms of electric vehicles, is a very bright one indeed.

[Jessica Morden (Newport East) (Lab)]

On behalf of all those working at the successful Liberty plant in Newport, may I reiterate how difficult this uncertainty is for the dedicated workforce who make world-class steel, and for their families? May I urge the Secretary of State to keep talking to and meeting virtually with groups of hon. Members, with Liberty plants and with the steel unions over the coming days? As my hon. Friend the Member for Manchester Central (Lucy Powell) said, the UK steel industry is the cornerstone of our national security and our economic prosperity, and it is absolutely crucial to our building back better.

[Kwasi Kwarteng]

The hon. Lady will know from our bilateral conversations that I am very committed, as Secretary of State, to the future of this sector. I am always happy to meet representatives, experts, workers, representatives in a trade union capacity and local management. I am always open to seeing people and trying to work out pragmatic, positive solutions. This is a really important issue and I am pleased to have engaged with the hon. Lady in the past, as I am sure I will in the future.

[Mr Speaker]

I am now suspending the House for a few minutes to enable the necessary arrangements to be made for the next business.

EU Emissions Trading System: Sale of Allowances

Kwasi Kwarteng Excerpts

Thursday 25th March 2021 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

In April 2019, the Government entered into a commercial agreement with British Steel Ltd in relation to their annual obligations under the EU emissions trading system (ETS). This agreement was needed to support the operator in complying with its 2018 EU ETS obligations, in the absence of receiving its expected 2019 free allowances, due to restrictions placed on the UK’s participation in the EU ETS during negotiations on the withdrawal agreement.

My right hon. Friend the Member for Tunbridge Wells (Greg Clark) informed the House of this agreement on 1 May 2019—a bridge facility valued at around £120 million under section 7 of the Industrial Development Act 1982 at an interest rate of LIBOR plus 7%. Under this commercial agreement, the Government were entitled to recover the next allocation of allowances issued to British Steel Ltd, and sell these back to the ETS market to recover the full cost of the bridge facility.

Following ratification of the withdrawal agreement, restrictions on the UK’s participation in the EU ETS market were lifted in February 2020 and the Government successfully recovered the allowances to which they were entitled. The Government have since successfully sold these allowances back to the EU ETS market, and concluded the contractual obligations with British Steel (in compulsory liquidation), under control of the official receiver.

I am pleased to inform the House that sale proceeds of nearly £140 million have been received. This exceeds the total cost owed to the Government from this bridge facility, delivering value for money for the UK taxpayer.

The Government have also sold a separate 3,191 allowances in their possession. These allowances were transferred to the UK national Government holding account within the EU ETS union registry, over several years, following the closure of several operator and trader accounts, in line with EU ETS registry regulations. The net sale proceeds from this transaction is around £80,000. This transaction is not related to the agreement with British Steel Ltd, and the sale of 3,191 allowances was undertaken separately for administrative reasons to provide value for money to UK taxpayers.

[HCWS887]

North Sea Oil and Gas and Clean Energy Transition

Kwasi Kwarteng Excerpts

Wednesday 24th March 2021 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

Today I am delighted to announce a landmark agreement between the Government and the oil and gas industry—the North sea transition deal—to support the industry’s transition to clean, green energy and secure future of high-skilled oil and gas workers and the supply chain. This follows our commitment to securing a deal in the 2019 Conservative party manifesto and is the first of its kind to be agreed by a G7 nation.

The offshore oil and gas industry has been a major British industrial success story. For decades, the sector has strengthened our energy security, generated significant tax revenue to fund our public services, and currently supports around 260,000 jobs across the UK. From the Shetland Islands and Aberdeen to Teesside and the Humber, the industry is critical to the health of local economies across the country.

In the energy White Paper, we have committed to work with industry to make the UK continental shelf a net zero basin by 2050. The oil and gas industry will have a critical role in maintaining our energy security through this transition. Domestically produced gas still met approximately 46% of the country’s supply of gas in 2019 and the Climate Change Committee forecasts our continued need for fossil fuels for years to come.

The North sea transition deal between the UK Government and the oil and gas industry will support workers, businesses, and the supply chain as it transitions to a net zero future by harnessing the industry’s existing capabilities, infrastructure, and private investment potential to exploit new and emerging technologies such as hydrogen production, carbon capture, usage and storage and offshore wind—as well as offshore decommissioning.

Through the deal, the oil and gas sector and the Government will work together over the long term to deliver the skills, innovation and new infrastructure required to decarbonise North sea production, as well as other carbon-intensive industries. Not only will the deal support existing companies to decarbonise in preparation for a net zero future, but it will also attract new industrial sectors to base themselves in the UK, develop new export opportunities for British businesses, and secure new high-value jobs.

Through the package of measures, the deal is expected to support up to 40,000 jobs across the supply chain and is expected to cut pollution by up to 60 million tonnes by 2030 including 15 million tonnes from oil and gas production on the UK continental shelf—the equivalent of annual emissions from 90% of the UK’s homes.

The North Sea Transition Deal

Delivery of the new green industrial revolution will require a strong partnership between the Government, regulators and industry. This deal sets out a template for that partnership and includes an ambitious plan to meet stretching greenhouse gas emissions reduction targets. The deal aims to support and anchor the expert supply chain that has built up around oil and gas in the UK, to both safeguard and create new high-quality jobs.

The deal includes:

The sector setting early targets to reduce emissions by 10% by 2025 and 25% by 2027, and it has committed to cut emissions by 50% by 2030. This will be supported by joint work to address the commercial and regulatory barriers to electrification of offshore platforms to realise these targets.

Joint Government and industry investment of up to £16 billion by 2030 to reduce carbon emissions. This includes up to £3 billion to replace fossil fuel-based power supplies on oil and gas platforms with renewable energy, up to £3 billion on carbon capture usage and storage, and up to £10 billion for hydrogen production.

By 2030, the sector will voluntarily commit to ensuring that 50% of its offshore decommissioning and new energy technology projects will be provided by local businesses, helping to anchor jobs to the UK. This will be supported by the appointment of an industry supply chain champion who will support the coordination of local growth and job opportunities with other sectors, such as carbon capture, usage and storage and offshore wind.

A 60Mt reduction in greenhouse gas emissions, including 15Mt through the progressive decarbonisation of UKCS production over the period to 2030¹.

Support for up to 40,000 direct and indirect supply chain jobs in decarbonising UKCS production and the CCUS and hydrogen sectors.

Today’s announcement delivers on the Prime Minister’s 10-point plan and builds on our ambitious energy White Paper, which set out how the Government would support the decarbonisation of offshore oil and gas production while promoting opportunities for the sector to transition to clean energy.

To aid the transition to a green economy, today’s package follows the recent Budget in which the Chancellor committed to funding that targets the oil and gas sector and supports businesses to develop green energy. This includes up to £27 million for the Aberdeen energy transition zone to transform the area into a green energy hub and up to £5 million additional funding for the global underwater hub based in Aberdeen to open up opportunities for the city to become a global hub for underwater engineering, including in offshore wind and hydrogen—further supporting the creation of green jobs and helping the transition to net zero.

I will place a copy of the North sea transition deal in the Libraries of both Houses.

The Review of Future Licensing of Offshore Oil and Gas

We committed in September 2020 to reviewing policy on licensing for North sea oil and gas to ensure it was compatible with our climate change objectives. This included assessing whether licensing for new oil and gas exploration and production should continue in its current form, as well as the scope for formalising any aspects of our existing processes to provide additional assurances.

Noting the ongoing role of oil and gas on our path to net zero, the Government will introduce a new climate compatibility checkpoint on future oil and gas licensing rounds to ensure they are compatible with wider climate objectives, including net zero emissions by 2050. This checkpoint will use the latest evidence of the time, looking at the UK’s demand for oil and gas, the sector’s projected production levels, the increasing prevalence of clean technologies such as offshore wind and carbon capture, and the sector’s continued progress against its ambitious emissions reduction targets.

Design of this checkpoint will be completed by the end of 2021, before the next oil and gas licensing round. The Oil and Gas Authority has already indicated that that it will not be running a new licensing round this year. In parallel, the Offshore Petroleum Regulator for Environment and Decommissioning is commencing work on a new offshore energy strategic environmental assessment which will underpin future licensing rounds.

Government response to the public consultation “Aligning UK international support for the clean energy transition”

At the Climate Ambition summit on 12 December 2020, the Prime Minister announced that the UK will end new direct financial or promotional support for the fossil fuel energy sector overseas, other than in limited circumstances, as soon as possible. A consultation on this and how to accelerate growth in UK clean energy exports was subsequently held until 8 February 2021.

Following the consultation, the Government will no longer provide support for the fossil fuel energy sector overseas from 31 March 2021. This will include UK Export Finance support, international aid funding, and trade promotion for new crude oil, natural gas and thermal coal projects.

To support the UK’s energy sector in making this transition, we will provide a one-year exemption for small and medium-sized enterprises, to ensure the most vulnerable firms are given time to adjust; provide a new “transition export development guarantee”, so that oil and gas focused companies with credible transition plans can benefit from UK Export Finance’s working capital support to achieve these plans; and publish a comprehensive and transparent description of the exemptions underpinning the policy shift, to provide clarity and certainty for business and civil society.

This balanced approach will make the UK an even stronger and more credible international partner to the growing number of countries who are seeking to make the transition to a cleaner future. The UK will build on the implementation of the policy shift by working with likeminded partners to make similar commitments, including through our G7 and COP26 presidencies.

¹The 60Mt also includes emissions savings from CCUS and hydrogen already set out in the PM’s 10-point plan.

[HCWS879]

Oral Answers to Questions

Kwasi Kwarteng Excerpts

Tuesday 23rd March 2021 Commons Chamber

[Craig Whittaker (Calder Valley) (Con)]

What discussions he has had with the Secretary of State for Health and Social Care on the effect on businesses of proposed TV advertising restrictions to help reduce rates of obesity.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I assure my hon. Friend that I meet regularly with the Secretary of State for Health and Social Care on a range of issues. My Department has engaged with businesses and colleagues across the country and within Government to ensure that our policy is proportionate and achieves the Government’s desired public health outcomes.

[Craig Whittaker [V]]

I thank my right hon. Friend for that answer. He may be aware that the scope of products captured in this proposal will be very wide indeed, including kitchen cupboard products such as All-Bran, HP sauce and cough sweets such as Fisherman’s Friend—products that are unlikely to appeal to children. Given the significant hit to business and UK broadcasters specifically, will he commit to working with the Secretary of State for Health and Social Care to narrow the scope of products covered by this proposal?

[Kwasi Kwarteng]

Of course I would be very happy to work closely with my right hon. Friend the Secretary of State for Health and Social Care. As I noted in my initial answer, my Department has worked closely with the Department of Health and Social Care up to this point, but I would be happy to hear more from my hon. Friend about this particularly important issue.

[Tony Lloyd (Rochdale) (Lab)]

What the timeframe is for bringing forward the legislative proposals on employment announced in the December 2019 Queen’s Speech.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I am grateful for the opportunity to say here in the House that the Government do intend to bring forward the employment Bill when parliamentary time allows.

[Seema Malhotra [V]]

The TUC estimates that 3.6 million people—one worker in nine—were in insecure work ahead of the coronavirus outbreak, leaving them exposed to massive drops in income or unsafe working conditions. It was bad then, and it is worse now. The Government have driven the author of their own Taylor review to say in quite extraordinary terms that the Government have lost their “enthusiasm” for enforcing workers’ rights. With no employment Bill yet on the horizon, is that not the plain truth for all to see? Whose side are the Government on?

[Kwasi Kwarteng]

I will take no lessons from the hon. Lady about workers’ rights and what this Government have done over many years to protect workers’ rights. The national living wage is higher than it has ever been in this country’s history. We have taken thousands of people out of tax, and I am not going to take any lectures from her.

[Tony Lloyd [V]]

If the Secretary of State will not take lessons from my hon. Friend the Member for Feltham and Heston (Seema Malhotra), will he take lessons from the TUC, which estimates that fire and rehire is most likely to take place among young people and black and Asian workers, or will he take lessons from Go North West, which sacked its workforce in Greater Manchester, and offered them increased hours of work, loss of sick pay and a reduction in annual pay of £2,500? Is that what the Secretary of State wants, to make Britain the best place in the world for work?

[Kwasi Kwarteng]

I appreciate the hon. Gentleman’s question. He will know that I take my relations and my conversations with the TUC extremely seriously. I have met a number of TUC leaders since taking up the post two months ago, and I am very conscious that fire and rehire as a negotiating tactic is completely unacceptable.

[Andy McDonald (Middlesbrough) (Lab)]

The Secretary of State says that he does not take lessons from Labour—this is from the man who described the British as

“the worst idlers in the world.”

The Supreme Court ruling that Uber drivers are workers, rejecting the company’s claim that its drivers are self-employed, sets a precedent for all gig economy workers, who will also be entitled to the minimum wage, holiday pay and sick pay, but it took Uber drivers six long years of legal action to have their rights recognised. The Government must not abandon the 3 million adults in the UK working in the gig economy to spend years fighting in the courts. So will the Secretary of State commit to introducing legislation in this Session of Parliament to ensure that all gig economy workers receive basic employment rights?

[Kwasi Kwarteng]

As I said in response to an earlier question, we are going to introduce an employment Bill not in this Session but when parliamentary time allows. We are also of course considering the effects of this extremely important Supreme Court ruling and we are considering options to improve clarity around employment status.

[Chris Stephens (Glasgow South West) (SNP)]

What recent discussions he has had with the Chancellor of the Exchequer on increasing support to businesses affected by the covid-19 outbreak.

--- Later in debate ---

[John Spellar (Warley) (Lab)]

What lessons have been learned from the operation of the vaccine taskforce.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

The vaccine taskforce has successfully brought together the collective effort of Government, academia and industry behind a single purpose and mission. Its hard work and focus, in partnership with the NHS and other organisations, helped the UK to become the first country to procure, authorise and deploy the Pfizer-BioNTech and Oxford-AstraZeneca vaccines. As I speak, over 30 million individuals across the UK have now received their first dose.

[John Spellar]

As the Secretary of State has rightly acknowledged, under his Department’s authorisation the vaccine taskforce has performed brilliantly, but it has needed a scientific and industrial base that was already there to work with. As he knows, there are some concerns about dependency on an overseas supply chain that may be interrupted. As the new Secretary of State, will he make a name for himself by challenging the dead hand of Treasury dogma and ensuring that Government contracts and projects across the board put British industry first at last?

[Kwasi Kwarteng]

I am very pleased that the right hon. Gentleman is so enthusiastic about our British ingenuity and hard work. I and my right hon. Friend the Chancellor of the Exchequer are always working extremely hard and are very focused on trying to promote innovation in this country in our research and development base.

[Yasmin Qureshi (Bolton South East) (Lab)]

What recent assessment he has made of the effect of the covid-19 outbreak on the wedding industry.

--- Later in debate ---

[Sarah Champion (Rotherham) (Lab)]

What his long-term policy is on support for British steel production.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I thank the hon. Lady for meeting me on 10 March to discuss this vital issue. It is of course a commercially sensitive matter that the Government are monitoring extremely closely.

[Sarah Champion [V]]

I thank the Secretary of State for that response, but more than 5,000 workers at Liberty Steel, including 900 in Rotherham, are facing an uncertain future following the collapse of Greensill Capital. Will the Secretary of State now commit, as other Governments in Europe have done, to step in, if necessary, to safeguard this vital strategic industry?

[Kwasi Kwarteng]

The hon. Lady will know that in my meetings with management and relevant union leaders, I have always stressed that the management plans need to be worked through. We are monitoring the situation extremely closely. The hon. Lady will know that I have a direct interest in the future of Liberty Steel.

[Lucy Powell (Manchester Central) (Lab/Co-op)]

Does the Secretary of State accept that, as well as supporting tens of thousands of decent jobs, UK steelmaking capacity is of key strategic importance to our future competitiveness and resilience? If he does, is he as concerned as we are about the future of Liberty Steel, and will he ensure that the Government are working now on a plan B with all options on the table, including public ownership, should the firm fail to secure finance? Or is he ideologically opposed to this, preferring the UK Government either to step aside or to spend huge sums to prop up businesses at risk only to sell them off cheap overseas?

[Kwasi Kwarteng]

The hon. Lady will know that we have a repeated and often stated commitment to decarbonisation in our industry. It was only last week that we published, under the leadership of my right hon. Friend the Minister for Business, Energy and Clean Growth, the industrial decarbonisation strategy. She will also appreciate that the steel industry is a vital part of that decarbonisation strategy.

[Carol Monaghan (Glasgow North West) (SNP)]

What discussions he has had with the Chancellor of the Exchequer on the funding of the UK associating to Horizon Europe.

--- Later in debate ---

[Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)]

  If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

In my two months as the BEIS Secretary of State, I have now held meetings with more than 200 businesses across the United Kingdom listening to their concerns and their hopes for the future. Last week, it was my real pleasure to see BEIS helping to make that future brighter when we launched our industrial decarbonisation strategy, which allocates more than £1 billion to driving down emissions from industry and public buildings. We have also published proposals for reforming audit and corporate governance, which will cement Britain’s status as the premier investment destination by raising standards, deterring fraud and empowering, potentially, a new regulator.

[Dr Cameron [V]]

The Secretary of State will be aware that the National Engineering Laboratory based in my constituency in East Kilbride has put together a vital proposal to build a clean fuels metrology centre. Given that this project enjoys cross-party support and is vital to the UK’s transition to a decarbonised economy, will he meet me, cross-party members of the all-party hydrogen group and industry representatives to discuss how to progress these important matters?

[Kwasi Kwarteng]

I would be delighted to meet the hon. Member and her associates in this enterprise. She will know that as Minister of State for Energy I was particularly keen on this new technology and I commissioned a hydrogen strategy that will be published in the next couple of months. I am very interested in this and of course I would be delighted to meet her and her colleagues.

[Dr James Davies (Vale of Clwyd) (Con) [V]]

  The future of plans for the Wylfa Newydd nuclear power station on Anglesey has been uncertain since Hitachi withdrew its interest. Other companies have, however, expressed an interest in the development, which could secure thousands of highly skilled jobs in north Wales. Will my right hon. Friend therefore meet me, the all-party Mersey Dee North Wales group and industry representatives to discuss the future of nuclear in the region?

[Kwasi Kwarteng]

I would be absolutely delighted to meet my hon. Friend and the bodies that he has mentioned. We are absolutely committed to nuclear power and to the people of north Wales, in particular. Wylfa is still a prime candidate for new nuclear power and I look forward to pursuing our discussions to see what may be done in this regard.

[Edward Miliband (Doncaster North) (Lab)]

Let me associate myself, Mr Speaker, with the important remarks you made on this national day of remembrance.

I want to follow up the question about Liberty Steel because the Business Secretary’s answer simply was not good enough. No ideology or dogma must stand in the way of protecting the jobs of 5,000 people and many more in the supply chain. This is a critical part of our national infrastructure and it is critical to those communities. Will he now do what he has failed to do so far and say that he will do whatever it takes, including public ownership if it is the best value for money choice, to save those jobs if it is necessary?

[Kwasi Kwarteng]

The right hon. Gentleman will be absolutely aware that this is an ongoing commercial matter. He will know that I have seen local management, representatives of the unions and a number of people who are very, very keenly involved in the steel sector, and it would not be appropriate for me to enter into what is a commercially sensitive situation. My heart goes out to the workers. They are an excellent workforce, and Liberty Steel has a fine tradition in this space, but it would be inappropriate for me to enter into what are live, commercially sensitive issues.

[Edward Miliband]

It is not about the Business Secretary’s meetings or about his heart; it is about his action and his willingness to say that he will do plan B if it is necessary to save those jobs, as we expect him to do. The problem is that the reason people are suspicious of the Secretary of State is that there used to be a cross-party consensus in this country about industrial strategy, but in his two months in office he has torn up the industrial strategy, abolished the Industrial Strategy Council, and thrown in the bin all the work local areas have done over a number of years. Maybe he can tell the business community: why does he hate industrial strategy so much?

[Kwasi Kwarteng]

I think it is very easy for the right hon. Gentleman to get obsessed with the words “industrial strategy”. What this Government are committed to is action. That is why we launched the decarbonisation industrial strategy. That is why we are pursuing the fourth auction round in offshore wind. That is why John Kerry, who I was very happy to meet two weeks ago, said that this country is a world leader in decarbonisation.

[Julian Sturdy (York Outer) (Con) [V]]

Can the Secretary of State assure me that if the Government take the very draconian decision to ban summer holidays abroad this year, they will provide targeted support to compensate the travel sector, which will be decimated by this decision?

[Kwasi Kwarteng]

My hon. Friend will know—if he does not, I will let him know—that when I took office two months ago, the things that the travel and hospitality sectors assured me that they needed more than ever were a road map and support. I am pleased to say that my right hon. Friend the Prime Minister came up with his road map on 22 February and my right hon. Friend the Chancellor extended unprecedented support to the economy on 3 March. I am happy to meet my hon. Friend to discuss whether he wants to see further actions, but we have committed £407 billion—an unprecedented amount—to supporting the economy at this terrible time.

[Mr Clive Betts (Sheffield South East) (Lab) [V]]

I am sure that the Secretary of State is aware that ITM Power based in my constituency is a leader in hydrogen research and production. It has just massively expanded its factory in my constituency. It is obviously disappointed that in the recent funding announcements the Government backed blue hydrogen projects but not any green hydrogen projects. As soon as restrictions allow, will the Secretary of State commit to visit ITM Power to look at the great work that it is doing and then review Government policy so we can make sure that the UK is where it should be—a world leader in the research and production of green hydrogen?

[Kwasi Kwarteng]

The hon. Gentleman will know that I have met ITM Power a number of times; I was honoured to meet them in Grimsby. It does a great job. He will also know that, in my time as Minister of State for Energy, I commissioned the hydrogen strategy, which will be published shortly. At the core of the strategy is a twin-track approach. We are promoting blue hydrogen—which is made through methane natural gas reformation—and, more particularly in answer to his question, we are also committed to green hydrogen, or electrolyser-produced hydrogen, in which ITM Power is the leader.

[Selaine Saxby (North Devon) (Con)]

Country Cousins is an English language school in Ilfracombe in my constituency that every year brings students to North Devon as part of the 550,000 international students who visit the UK to study English, bringing in £1.4 billion and 35,000 jobs to our economy. English language schools were viable, profitable businesses before the pandemic, greatly contributing to their local economies and culture. I am sure my hon. Friend the Minister agrees that, given the right support they will be again. However, many of them have been excluded from the Government’s business rates relief for the next financial year and are struggling. Will my hon. Friend consider committing BEIS to work with the Ministry of Housing, Communities and Local Government to look at expanding the eligibility for this—

--- Later in debate ---

[Laura Trott (Sevenoaks) (Con) [V]]

Across Sevenoaks and Swanley, high streets are preparing to reopen, supported by our brilliant Sevenoaks District Council. However, we are finding that some of our local businesses are being rejected for support from the high street recovery fund. Will my right hon. Friend the Secretary of State meet me and my local council to discuss how we can address some of the issues?

[Kwasi Kwarteng]

I would be delighted to meet my hon. Friend and others to discuss these important issues. As my hon. Friend mentioned, the high street is clearly a hugely important part of our economy, and that is why the business rates review will be particularly interesting.

[Tony Lloyd (Rochdale) (Lab)]

  Under the seasonal workers scheme, young people arrive from Russia, Belarus and Ukraine to pick fruit and vegetables to feed our public, but they are employed on zero-hours contracts, sometimes deprived of work, and cannot make money. This is a form of modern-day slavery. Will the Minister look into it and make sure we put an end to it?

--- Later in debate ---

[Justin Madders (Ellesmere Port and Neston) (Lab)]

Ellesmere Port is home to the HyNet North West project, and we were absolutely delighted to secure funding in the first round of Government support. However, there is concern that different levels of priority will be applied to the various hydrogen projects around the country when future funding is determined, so there is a risk of losing momentum. Will the Department look again at that proposal and ensure that in future funding rounds no project is held back?

[Kwasi Kwarteng]

As the hon. Gentleman knows, we have considerable plans for hydrogen production. We have a hydrogen strategy coming forward, and we have consulted on business models. I am sure that people in Ellesmere Port, and the HyNet cluster generally, will have a big part to play in the development of hydrogen production in this country.

[Elliot Colburn (Carshalton and Wallington) (Con) [V]]

  The Beddington incinerator is one of the biggest carbon polluters in Carshalton and Wallington. I have previously raised concerns about recyclable materials being sent for incineration. What estimates has the Department for Business, Energy and Industrial Strategy made of the quantity of recyclable materials sent to so-called energy-from-waste operations, and what steps has the Department taken to ensure that those activities record carbon output accurately?

Advanced Research and Invention Agency Bill

Kwasi Kwarteng Excerpts

2nd reading
Tuesday 23rd March 2021 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

I beg to move, That the Bill be now read a Second time.

I should like to start my remarks by drawing attention to the much-celebrated work of Edward Jenner. I am sure that many of us appreciate his work. He is often referred to as the father of immunology; he was a British physician who created the world’s first vaccine. As I am sure all hon. Members know, he was an apprentice to a surgeon in Chipping Sodbury in the constituency of my hon. Friend the Member for Thornbury and Yate (Luke Hall). Mr Jenner essentially discovered immunisation. When we consider the coronavirus that has devasted our country and the world this year and last year, Jenner’s work takes on a particular resonance.

Thanks to the UK’s historic funding for research and the groundbreaking action of scientists at Oxford University, a British vaccine is once again helping us to return to a more normal life. It has shown us all the incredible benefits that breakthrough science and technology can provide. Building on our country’s proud history of wonderful inventions, I was particularly pleased to announce the creation of the Advanced Research and Invention Agency last month. I am sure that it will play a unique and exciting role in the UK’s research and development system.

The new agency will be characterised by a sole focus on funding high-risk, high-reward research. It will have strategic and cultural autonomy. It will invest in the judgment of able people, and it will also enjoy flexibility and a wide degree of operational freedom. I have spoken with many of our leading scientists, researchers and innovators and their message has been absolutely clear. I am convinced that these features will make ARIA succeed.

The creation of ARIA is part of a concerted action by this Government to cement the UK’s position as a science superpower. With £800 million committed to ARIA by 2024-25, the new agency will contribute extremely effectively to our R&D ecosystem. As set out in our policy statement published only last week, we have to give ARIA significant powers and freedoms and a mandate to be bold. To deliver that, we have introduced the ARIA Bill.

The Bill recognises that funding transformational long-term science requires patience and a high risk appetite. The Bill explicitly states that ARIA may give weight to the potential of significant benefits when funding research that carries a high risk of failure. This freedom to fail is fundamental to ARIA’s model, and the provision will empower its leaders to make ambitious research and funding decisions. When we look back in history, to the 1950s and 1960s, we see that with this approach a US agency called the Advanced Research Projects Agency developed GPS as well as the precursor to the internet.

The Bill will also signal a 10-year grace period before the power to dissolve the agency can be exercised. The agency will be focused exclusively, as I have said, on high-risk research. It requires patience and a laser-like focus as necessary conditions for success.

[Aaron Bell (Newcastle-under-Lyme) (Con)]

My right hon. Friend is making a strong case and refers to the work of the Vaccine Taskforce. In the past year, we have seen astonishing science conducted at breakneck speed because we have been in a crisis. Does he agree that for ARIA to work we need somehow to harness that sense of crisis and continue to use it in a normal period to get this sort of high-risk and high-reward research out and developed in Britain?

[Kwasi Kwarteng]

The circumstances in which we have developed the Vaccine Taskforce have been really unfortunate, with this terrible pandemic, but the very thin silver lining around the cloud has been this remarkable vaccine rollout. My hon. Friend is right that ARIA needs to learn from what we have learned collectively from the vaccine rollout.

Our objective is for ARIA to fund research in new and innovative ways. The Bill provides the agency with significant powers that are necessary for it to perform its function.

[Daniel Zeichner (Cambridge) (Lab)]

The right hon. Gentleman says that the agency is modelled on the American example, but the American example very clearly has a client. Which is the client Department for this Bill?

[Kwasi Kwarteng]

Forgive me, I did not say that it was modelled on that example. I said that it was inspired, and I referred allusively, in my usual way, to historical precedent. I never said that it was modelled exactly on the American example. I am sure that the hon. Gentleman will make a fuller contribution to the debate.

Let me make some progress. Different funding methods obviously suit different projects. ARIA may seek to use seed grants. It will have inducement prizes. It may make its own investments in companies. All of these different approaches will drive innovation, and that will allow ARIA to target, for example, a Scottish university or a semiconductor start-up in Wales and to ensure that researchers across the UK can contribute to developing the key technologies for tomorrow.

ARIA will also have strategic independence. It will, as I have said, have the freedom to fail; it will have the freedom to take a long-term view and to experiment with new ways of funding the most ambitious research, which experience tells us is a necessary ingredient for some of the best results. A key part of this freedom will be trusting the leadership of ARIA to identify and decide on areas of research with perhaps the greatest potential. The Bill limits the ability for Ministers, as it should do, to intervene in ARIA’s day-to-day operations or to direct funding decisions. Instead, ARIA will have a highly skilled team of leadership programme managers who, supported by the board, will ensure strong strategic oversight over the portfolio of programmes. As the Bill makes clear, ARIA must have regard to the benefits of that research to the UK—to the people of this country—in terms of not only economic growth but trying to ensure that innovation can improve the quality of life of all our fellow subjects.

Our response to coronavirus as a nation has shown that agility is crucial in funding research in this fast-moving world. All of this work builds on action already taken by the Government and by UK Research and Innovation to reduce unnecessary bureaucracy in the wider ecosystem. We have learned from agencies such as DARPA in the US—the hon. Member for Cambridge (Daniel Zeichner) will be pleased to learn that—which has shown that we need to go several steps further in creating a culture that is primarily focused on pursuing high-risk research. There is a cultural need in such an organisation for autonomy and a measure of dynamism, which can be achieved through exceptional leadership and, perhaps most importantly, through a flat, streamlined structure.

ARIA will benefit from being a small and nimble agency. It will create a unique environment for its programme managers to be completely focused on their particular research proposal. The Bill therefore provides ARIA with some additional but proportionate freedoms, which are not generally found in the rest of our system. For example, it exempts ARIA from public contracting rules. That will allow ARIA to procure R&D services and equipment relating to its research goals in a similar way to a private sector organisation. To ensure that that process is transparent, it sits alongside a commitment in the Bill to audit ARIA’s procurement activities.

In order to further this research-intensive culture, ARIA has been given extensive freedoms. However, we will ensure, as the Bill does, that the organisation submits a statement of accounts and an annual report on its activities, which will be laid directly before Parliament. Those commitments to transparency will sit alongside the customary and necessary scrutiny by the National Audit Office.

It is clear that ARIA will be a unique and extremely valuable addition in our research landscape. It will create a more diverse, more dynamic and creative funding system, which will ensure that transformative ideas, wherever they may come from, can change people’s lives for the better.

I am very conscious that there is a huge amount of interest in this debate on the Back Benches on both sides of the House. I have committed myself not to go on for two hours or whatever the customary length of time might be. Having been a Back Bencher myself, I know that it is often frustrating to hear Front Benchers trench on parliamentary time. As a consequence, I hope that hon. and right hon. Members will agree that, as we build back better, we can have a full debate today about the merits of ARIA and its necessary existence. I hope that the Bill will show the Government’s strong commitment to building on a wonderful research base. On that basis, I commend the Bill to the House.

[Madam Deputy Speaker (Dame Eleanor Laing)]

This is an opportune moment for me to give notice to people who are hoping to speak in the debate—those here in the Chamber, but particularly those at home who perhaps might not pick up the atmosphere and be tempted to do the opposite of what the Secretary of State has just said by taking rather longer than they ought to take. I am going to try to run this Second Reading debate without a formal time limit, in the hope that Members will act reasonably and unselfishly towards their colleagues, and keep their speeches to about five to six minutes, or less. I say this particularly to people who are at home, because I cannot nod to them or grimace at them to let them know when they have spoken for too long. Five minutes would be just about right for everyone who wishes to speak to have the opportunity to do so.

[Edward Miliband (Doncaster North) (Lab)]

Let me start by saying that across the House we share the admiration for British science. It is one of our most brilliant national assets, employing nearly 1 million people directly and generating extraordinary value for our country. As the Secretary of State eloquently said, the work on vaccines has been truly remarkable. We commend our scientists and everyone involved for their work. Indeed, I hope the Secretary of State will not mind my saying that it is a successful example of an industrial strategy; the right hon. Member for Tunbridge Wells (Greg Clark) probably shares my view.

I turn to the details of the Bill. I should say from the beginning that we support the Bill; we have some issues with it, but we certainly support its aims. I just want to say something about the wider context, because I found it slightly remarkable that the Secretary of State did not mention the fact that we are two weeks from the start of the next financial year but the scientific community does not know its budget, and the Government appear to be contemplating significant cuts to its programmes.

The Secretary of State said last week to the Science and Technology Committee, which is chaired by the right hon. Member for Tunbridge Wells, that the Government

“are talking the talk of a science superpower…but…we also have to walk the walk.”

Quite. We support the intent of the Advanced Research and Invention Agency, but hon. and right hon. Members across the House should be aware that while the ARIA budget is £800 million over this Parliament, UK Research and Innovation’s annual budget is £9 billion. Last week, UKRI published a letter confirming that the BEIS official development assistance allocation will lead to a £120 million gap between its allocation and the commitments that it has already made. It warned of cuts coming on that scale, and the House should be aware of where those cuts are going to be. Potential areas include climate change, antimicrobial resistance, pandemics, renewable energy and water sanitation. Those are the kinds of things that that funding addresses. Mr Cummings was also at the Select Committee meeting—I will return to him shortly—saying that ARIA would solve the problems of civilisation. That is all very well, but I fear that these cuts seem to be coming right here, right now; and we cannot launch a successful moonshot if we cut off the power supply to the space station.

The other fear that we have is that the threat of cuts does not end there, because there is no clarity on how to cover the huge cost of the UK’s ongoing participation in Horizon Europe programme. To be clear, this programme used to be funded not from the science budget, but from our EU contributions. I say to the Secretary of State that it surely cannot be right to take money from the science budget to fund our participation. He will know that there is real fear in the scientific community about that.

I will give the Secretary of State the chance to intervene: does he not agree that cutting the science budget to fund Horizon would be exactly talking the talk but not walking the walk? I will happily give way to him if he wants to tell us. Maybe he can tell us when we will get clarity—when will the scientific community get clarity on how the Horizon money will be funded? He does not want to intervene, but the science community deserves clarity. We support ARIA but it deserves clarity. These are people’s jobs. This is incredibly important work and I hope he is fighting with his friends in the Treasury as hard as he can to give people that clarity and avoid the cuts.

[Kwasi Kwarteng]

rose—

[Edward Miliband]

Maybe he is going to tell us the news.

[Kwasi Kwarteng]

The right hon. Gentleman will know from his years in government—appreciably, many years ago now—that these conversations with the Treasury are ongoing, and we hope to get a satisfactory result.

[Edward Miliband]

We shall look forward to the Secretary of State getting a satisfactory result. I am not sure that I always got a satisfactory result with the Treasury, although I was in the Treasury at one point, at least as an adviser. This is very important and, as I say, people’s jobs and livelihoods and the scientific base of this country, of which we are all so proud, depend on it.

Let me come to the Bill, which we support. The Bill is important—the Secretary of State said this—because there is incredible work going on in the scientific community, but there is consensus that there is a lack of a mechanism to identify, build and fund truly ambitious, high-risk, high-reward programmes. We recognise the case for an independent agency that operates outside the established research funding mechanisms, but we feel that the Bill requires improvement.

I guess our concerns cohere into a different view about the role of Government and the lessons of DARPA, which my hon. Friend the Member for Cambridge (Daniel Zeichner) talked about, on which in some broad sense—maybe not in the Secretary of State’s mind, but in others’ minds—ARIA is modelled. It is impossible to ignore what we might call the spectre of Dom in this debate. He was at the Science and Technology Committee—chaired by the right hon. Member for Tunbridge Wells—and he does rather hang over this Bill. He is its sort of governmental godfather. In his telling, DARPA’s success—I think this is important—is simply because the Government got out of the way and let a bunch of buccaneering individuals do what they liked. It is definitely true, as I understand it, that DARPA has important lessons about the need for the culture that I talked about, including higher reward and, of necessity, a higher chance of failure, but it is simply not true that DARPA was somehow totally detached from Government. DARPA had an obvious client—the Department of Defense—a clear mandate around defence-related research, a clear synergy in its work with the procurement power of the US DOD and, incidentally, abided by laws on freedom of information.

I want to suggest that there are two different views about ARIA: one is that we should let the organisation simply do what it wants, relying on the wisdom of a genius chair and chief executive; and the other subtler and, in our view, more sensible approach—one more consistent with the lessons of DARPA—is that Government should set a clear mandate and framework for ARIA and then get out of the way and not interfere with its day-to-day decision-making. I also believe there is a democratic case, because the priority goals for the spending of £800 million over this Parliament should be driven by democratic choices; not about the specific items that it funds, but about the goals and mission.

That takes me to the three points that I want to make: first, about the mandate for ARIA; secondly, about its position in the wider R&D system; and thirdly, about accountability. I will try to emulate the Secretary of State’s brevity—perhaps not exactly his brevity, but as much as I can.

The deputy director of DARPA says about its success that

“having national security as the mission frames everything.”

The Secretary of State said to the right hon. Member for Tunbridge Wells at the Science and Technology Committee:

“If I were in your position, I would be asking what the core missions of ARIA are.”

I think the point that Dominic Cummings made, or I am sure would have made, is that this will be a job for the people we hire who are running the organisation. The Secretary of State went on:

“It will be up to the head of ARIA to decide whether he or she thinks the organisation should adopt what the innovation strategy suggests…or reject it.”

I really understand the wish to give freedom to ARIA, but surely it is for Government to shape and not shirk the setting of priorities, and it is not just DARPA where we can learn that lesson. Moonshot R&D—the Japanese agency established in 2019 to fund challenging R&D—has seven specific moonshot goals set by the Japanese Government, and my understanding from the evidence taken by the Science and Technology Committee is that the UK scientific community agrees with that idea.

I notice the hon. Member for North East Bedfordshire (Richard Fuller) putting his head in his hands. He has done that before when I speak, but let me just make this point in seriousness: £800 million is not in the scheme of things a huge amount of money, certainly when compared with UKRI’s budget. The concern is that unless, as the Select Committee said, ARIA focuses on a single or a small number of missions, it will dilute its impact.

Take the net zero challenge. I believe it is a challenge of political will and imagination, but it is also a technological challenge. If it is the No. 1 international challenge, as the PM said last week, and if it is the No. 1 domestic challenge, as I think it is, why would it not be the right mandate for ARIA for at least its first five years? Indeed, Professor Richard Jones and Professor Mariana Mazzucato, who perhaps have even greater claims than Dom to being godfather and godmother of this idea, said that climate change would be an ideal challenge on which an agency such as ARIA would focus. To be clear, providing a mandate does not mean micro-managing decisions, and it would be grossly simplistic to suggest otherwise.

Audit and Corporate Governance Reforms

Kwasi Kwarteng Excerpts

Thursday 18th March 2021 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

Today the Government are publishing their ambitious plans to strengthen the UK’s audit, company reporting and corporate governance framework, “Restoring trust in audit and corporate governance”, which I will lay in the House. These proposals will ensure the UK’s markets are at the cutting edge of global best practice.

British business is built on trust, so it is vital that our leading companies can command the confidence of the financial markets, investment community and wider public as the UK recovers from the effects of covid-19. Our comprehensive package of reforms will strengthen reporting, audit and governance in the UK’s largest companies. The proposals will help cement the UK’s position as a world-leading destination for investment by helping to ensure that our leading companies are governed responsibly and that investors, creditors, workers and others have access to the information they need.

Our proposals respond to the independent reviews led by Sir John Kingman, Sir Donald Brydon and the Competition and Markets Authority, and I would like to thank each of them for their valuable contributions. Today’s publication sets out a balanced and wide-ranging package of reforms which will lay the foundations for British companies to build back stronger as the UK recovers from the effects of covid-19 and in the wake of recent corporate failures. Restoring business confidence, but also people’s confidence in business, is crucial to repairing our economy and building back better from the pandemic.

In particular, the Government’s proposals include:

supporting directors of large companies in planning for long-term success through annual resilience statements: setting out how they are mitigating short and long-term risks, for the benefit not only of shareholders but also of local communities, suppliers, customers and the wider UK economy;

making directors of the country’s biggest companies more accountable when they breach their duties, with the prospect of fines or bans only when there are serious failings, such as misleading accounts or hiding information from auditors. This measure is targeted at the very largest companies in the UK, not start-ups and small businesses, and would not affect the vast majority of directors. Instead, it reflects the level of responsibility that comes with a board position in the largest companies;

addressing “rewards for failure” through mechanisms to claw bonuses back following misconduct or management failures;

measures to unleash competition and strengthen governance in the audit market, overseen by a new regulator, to increase choice and drive up resilience;

recognising the economic importance of the largest privately-owned companies by ensuring they meet the highest governance and reporting standards;

making company reporting more transparent and informative: so that they pay out dividends only when they have sufficient reserves, and enabling companies to have a wider range of metrics audited, for example climate disclosures.

These proposals will all be backed by the creation of a strong and independent statutory authority for audit, corporate reporting and governance. Replacing the Financial Reporting Council, the new regulator will be given much stronger powers to enforce standards. We also propose that it will have the power to impose an operational split between the audit and non-audit functions of accountancy firms, to reduce the risk of any conflicts of interest that may affect the standard of audit they provide.

The UK is consistently placed as one of the leading destinations for foreign investment in Europe and around the world. These reforms will sustain and build on the UK’s position, and reinforce the Government’s wider work to ensure the UK remains a world-class destination for investment.

The reforms cover the whole of the UK since, although company law is devolved in Northern Ireland, to date the Northern Ireland Executive has preferred to align with Great Britain in this area. The Government will also continue to work closely with the devolved Administrations in Wales and Scotland in developing the final provisions.

In light of the challenging circumstances for companies, the Government’s consultation period will run for 16 weeks. The Government then intend to bring forward legislation when parliamentary time allows. We will implement reforms in a proportionate way that does not prove burdensome to business, for example considering a limited exemption for newly listed firms from the new requirements.

I will place a copy of the three supplementary publications, including an impact assessment of the proposed measures, in the Libraries of both Houses.

[HCWS852]

Budget Resolutions and Economic Situation

Kwasi Kwarteng Excerpts

Tuesday 9th March 2021 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Kwasi Kwarteng)]

It is a real pleasure for me to open today’s debate on the Budget that my right hon. Friend the Chancellor the Exchequer brought before the House last week. It is a Budget that meets the needs of the moment. It delivers support to all corners of our United Kingdom. It shores up our defences against the ravaging impact of the pandemic while laying a clear path for our journey out of the crisis and into a brighter future. As the Chancellor himself acknowledged last week, it is a path that we are only able to take because of the incredible efforts of our frontline health workers who have vaccinated more than 20 million people across the United Kingdom, and the researchers and manufacturers who have managed to produce effective vaccines in such a short space of time. I am sure I speak on behalf of the entire House when I express the deepest gratitude to everyone involved in this heroic national effort.

[Mrs Theresa May (Maidenhead) (Con)]

My right hon. Friend makes some very important points about our health staff and the vaccination programme, which has been absolutely superb in this country. Does he recognise that the creation of a new vaccine centre and medicines manufacturing centre were part of the life sciences deals that were enabled by the modern industrial strategy? Will he welcome the modern industrial strategy?

[Kwasi Kwarteng]

I have not come here to defend or rebut any of the wonderful measures that we took under my right hon. Friend’s leadership. I am very conscious of the fact that many people want to take part in this debate, and I am afraid that I have to press on.

The researchers and manufacturers have done an extremely good job, as my right hon. Friend says, in shoring up our response to the crisis. The Budget provides an additional £65 billion of measures in response to covid, designed to support the economy this year. It covers an extension of the furlough scheme, which has already supported 1.3 million employers and more than 11 million jobs, providing vital funds to households and communities throughout our country. It has added to the near £20 billion of support that the Treasury has paid out to support 2.7 million self-employed people.

The Budget presents a dynamic and generous plan to help businesses to get up to speed. We are providing restart grants of up to £18,000 to more than 680,000 business premises. We are also providing further support for hospitality and retail businesses who may be more affected by restrictions when they reopen. While our plan for jobs has been given a £126 million boost supporting 40,000 more traineeships and doubling the cash incentive for firms taking on new apprentices, the Budget ensures that more people are able to access secure, skilled work.

Of course, there can be no denial that the jobs market has changed profoundly over the past year.

[Greg Clark (Tunbridge Wells) (Con)]

Will my right hon. Friend give way?

[Kwasi Kwarteng]

I am very conscious, as I am sure my right hon. Friend I, that many, many Back Benchers want to take part in the debate. I understand that he is on the call list, so I am afraid I am going to have to make more progress.

It is no secret that over the years, and even in years of strong growth, prosperity has not been spread fairly between the regions and nations that make up our United Kingdom. That is an imbalance that this Budget seeks to correct, with the Department for Business, Energy and Industrial Strategy leading the charge. Where regions have been left behind by the decline of old industries, we will create new industries and support sectors as they transition to a low-carbon, sustainable and competitive future.

[Greg Clark]

Will my right hon. Friend give way on that point?

[Kwasi Kwarteng]

I must press on. Lots of Back Benchers want to speak. However eminent and distinguished my right hon. Friend is, there are lots of other people who want to speak.

We are backing the development of hydrogen hubs in the Tees Valley and Holyhead, to breathe new life into coastal and post-industrial communities while we drive a new clean energy transition. We are establishing four carbon capture and storage clusters across the next two decades, and we hope that they will play their part in decarbonising our industrial processes. We are investing tens of millions of pounds in the Aberdeen energy transition zone and the global underwater hub.

We are providing a support package of more than £2 billion to Britain’s incredible auto industry, with £500 million going towards the growth of our electric vehicle supply chain. That package will help to support and safeguard nearly 170,000 jobs in the UK auto sector, including in the north of England, the west midlands and Wales. We intend fully to deliver a boost to the ambition to build at least one UK gigafactory before the end of this Parliament, and we hope to secure investment for others in the longer term.

[Greg Clark]

I am grateful to my right hon. Friend and successor for giving way. Will he acknowledge that the battery manufacturing innovation centre and the Faraday challenge, which galvanised the move to providing batteries for electric vehicles, were part of the industrial strategy, as was vaccine manufacturing? Can he explain why it is thought appropriate to abolish that strategy? Is it not better to have a plan, rather than no plan?

[Kwasi Kwarteng]

I hear my right hon. Friend’s passionate defence of his own work, and I commend a lot of his work. I have read the industrial strategy comprehensively, and it was a pudding without a theme, in my view. I feel very strongly that the conditions of 2017 do not apply to 2021, and I am very pleased to announce to the House that we are morphing and changing the industrial strategy into the plan for growth. I am happy to take further interventions on that, should they arise.

What we have announced in these packages is levelling up in action. There will be new investment in new industries, creating new jobs and driving real change in communities across the UK. With these examples, we are talking about a vision for the future of the kind of country we want to be: a country that hosts good-quality, high-skilled, long-term jobs in every community and that takes its commitment to net zero extremely seriously. I would like to commend the work of my right hon. Friends the Members for Maidenhead (Mrs May) and for Tunbridge Wells (Greg Clark) in passing the net zero legislation in 2019. That was a signal piece of legislation for which I commend them heartily. As Secretary of State for Business, Energy and Industrial Strategy—which is still the name of the Department—I am very pleased that we are committed to net zero in the way that we are.

Because of all the profound changes that we have seen over the last three or four years, as well as our departure from the EU, our legislation to end our contribution to climate change by 2050 and the unprecedented impact of the coronavirus, I believe that we must take a fresh look at our plans for industrial policy and long-term economic growth. As a consequence of all this, alongside the Budget, we have published “Build Back Better: our plan for growth”. Our cross-government plan for growth signals a departure from the industrial strategy brand and details a renewed focus on infrastructure, skills and innovation. It reflects new opportunities available to us following our exit from the European Union, which was successfully achieved as a consequence of the deal that we struck at the end of last year. This opens up new ways to drive growth, build on our competitive advantage and support a vision for a truly global Britain. We will draw on the valuable lessons we have learnt from the 2017 industrial strategy as we transition to this new, more focused and more ambitious plan for growth.

I want to reassure the House that the energy of my Department is entirely focused on building back better after the coronavirus pandemic. It is leading the Government’s work on supporting British industry and priority sectors, and I am happy to acknowledge that we are building on the incredibly dynamic and good work that was pursued by my right hon. Friend the Member for Tunbridge Wells. We will publish our innovation strategy in the summer. We will set out details of our approach to supporting sectors, places and technologies in the innovation strategy. Those will give a clear indication and sense of purpose as we seek to shape the UK’s future. My Department is already leading on strategies with respect to net zero, hydrogen and, of course, innovation itself, as well as the space strategy. We are engaging on a comprehensive programme of work to protect and create jobs as we transition to net zero.

The principle underlying all this effort is, of course, the green recovery. We fully intend to end, and we will end, our contribution to climate change by 2050, and we will do so through investments and innovations such as the ones I have just mentioned. Last week’s Budget builds on the framework set out by the Prime Minister’s 10-point plan, as well as on the support announced at the spending review and in the national infrastructure strategy.

I am delighted that my right hon. Friend the Chancellor spoke fulsomely about the UK infrastructure bank. The bank will target investment in green projects, which will help us meet our net zero targets in the public and private sectors throughout the country. It will provide a global centre of excellence and advisory support for net zero projects across the country.

We have committed an initial £12 billion of capital and £10 billion of guarantees. By crowding in— attracting—private investment, we fully expect the bank to support at least £40 billion of investment in our precious infrastructure. This investment will help us to amplify success in decreasing emissions, which we have already reduced by 44% against 1990 levels. That is by far the best performance in the G7.

With our strengths in many sectors, from offshore wind to hydrogen, carbon capture technologies and zero-emission vehicles, we are well placed to seize the opportunity of the green transition and lead a global green industrial revolution. The 10-point plan, which the Budget expands on, puts us in a very good position to achieve that goal.

Backed by £12 billion of public investment, the 10-point plan will reinvigorate our industrial heartlands in the north-east, the north-west, Yorkshire, the Humber, the midlands, Scotland, Wales and elsewhere. It will support the creation of hundreds of thousands of green jobs across the UK by 2030. It represents a really exciting and dynamic vision for the development of economic opportunity throughout this country.

This is a Budget that is timely in its interventions, entirely realistic in its ambitions and, above all, remorselessly and unapologetically optimistic about the future of the United Kingdom. It outlines an investment-led recovery, with a targeted, laser-like approach to levelling up every nation and region.

Thanks to the actions of the Government, we will emerge from this virus sooner and stronger than many would have anticipated. Thanks to the Budget, we have the means and the tools necessary to continue our trajectory towards recovery in the next year. We will be embracing innovation, we will be creating green jobs and we will be rejuvenating our industrial heartlands and spreading opportunities. We look forward to building back better throughout the entirety of the United Kingdom.

[Edward Miliband (Doncaster North) (Lab)]

I want to start by quoting a speech given in this Chamber 77 years ago, in June 1944, by Ernest Bevin, who was then the Minister of Labour. He said:

“With my right hon. Friend the Prime Minister, I had an opportunity of visiting one of our ports and seeing the men, of the 50th Division among others, going aboard ship…The one question they put to me when I went through their ranks was, ‘Ernie, when we have done this job for you, are we going back to the dole?’…Both the Prime Minister and I answered, ‘No, you are not.’”—[Official Report, 21 June 1944; Vol. 401, c. 212-13.]

The circumstances of this Budget are, of course, very different, but the sentiment is just as relevant. As we come through a very different national crisis, how do we in our generation do right by the British people? Some 120,000 people have died from covid. Our way of life has been dramatically restricted. Our key workers have stepped up and put themselves in harm’s way for all of us. Businesses have shuttered to protect our health and have faced incredible strain. The British people have been nothing short of heroic.

While the crisis has revealed the best of our country, it has also laid bare the deep flaws in the way our institutions and economy are run. In the words of the OBR,

“the UK has experienced higher rates of infection, hospitalisations, and deaths from the virus than other countries.”

We know that is partly because of higher deprivation, inequality and poverty. We know we are deeply unequal, both within and between our regions. Even before this crisis, 2 million of our fellow citizens faced destitution. That means they lacked at least two of the following basic essentials: shelter, food, heating, lighting, clothing or basic toiletries. That should shame us all in one of the richest countries in the world. We know our public services are deeply underfunded, from health to social care. We know, too, that the world of work is characterised by deep divisions of power, which meant some workers were safe and some were not.

This chasm between the spirit of the British people and the reality of how our country works demands from us that we face the Bevin question once again, of how we transform our country not just on jobs, but on public services and on inequality, too. This challenges us all, whatever party, to think bigger and more boldly. Of course that is hard, in the dire circumstances we face coming out of this pandemic—the public finances are under strain and the economy will take time to recover—but they are far less dire than those Bevin and his colleagues faced after 1945, and they thought big about the kind of country we could be. They raised their sights in the face of adversity.

While I would praise some of the measures taken by the Chancellor, I do not believe that a fair-minded observer would say that the Budget passes the Bevin test. On jobs, according to the OBR, even by 2025 unemployment never even gets back to pre-crisis levels. On welfare, the Budget tells people on universal credit that they need to go back to living on £74 a week from September, just as unemployment starts to peak. On the next crisis—the climate emergency—the Budget rejects a green stimulus and cuts green spending, as I will explain.

On public services—I do not think the Business Secretary talked about public services—the Budget appears to draw the extraordinary lesson from the crisis that public services need less resources, not more. In total, £17 billion has been taken out of departmental spending since Budget 2020, which was before the crisis, despite the greater needs and despite all that has been revealed in the pandemic.

What does building back better mean when unemployment is higher as far as the eye can see, the welfare state goes back to the way it was, the green revolution is ducked and public service spending is cut? This Budget fails the Bevin test and the build back better test. Why? I think it is because the Government have not truly learned the lessons of the past decade.

To be fair, the Government have been remarkably open about the failure of the last decade. The Business Secretary referred to the “Build Back Better” document that they published. It is a very interesting document, perhaps not for the reasons intended. There is a striking chart that shows the long-standing productivity gap between ourselves and our competitors, but it shows something else. In the past decade, we have not addressed our long-standing weaknesses, but fallen further behind. The productivity gap has doubled with Germany and is up by three quarters with France and one quarter with the US. Government getting out of the way did not work. Markets left to their own devices did not work and austerity did not work, so the question for the Government is: what are they going to do differently in the coming years from the last 10?

We needed first of all—the right hon. Members for Maidenhead (Mrs May) and for Tunbridge Wells (Greg Clark) have made reference to it—an industrial policy that intervenes at scale to help growth sectors and industries to succeed. There is one pre-eminent test on that, which is the green stimulus. To give some context, President Biden has pledged a $1.7 trillion green plan over 10 years. Germany has committed €40 billion over two years and France €30 billion over two years. Even what the Business Secretary claims—I will come to that shortly—is a fraction of that amount over the decade.

Let us take the infrastructure bank, as the Secretary of State talked about that. The OBR is highly revealing on the infrastructure bank: the annual spending of the bank is going to be just a third of the amount of its predecessor, the European Investment Bank—£1.5 billion a year versus £5 billion a year. So, not more investment, but less. What is the OBR’s verdict on the infrastructure bank? It says that

“given the scale of its operations (at around 0.1 per cent of GDP a year) and the fact that it replaces only some European Investment Bank activity, we have not adjusted our economy forecast.”

In other words, the bank has absolutely zero effect on growth, from all of those green measures that the Business Secretary talked about.

One of the most interesting things about the Budget—but which has perhaps been less remarked on—is that the growth returns to trend is up just an anaemic 1.7%. That is incredibly low by historical standards. This is low growth and low ambition.

A green stimulus could have helped our crucial manufacturing sectors, but instead they were left out in the cold. On steel, where is the £250 million clean steel fund, which was promised two years ago? There is no mention of steel in this 110-page document. On offshore wind, we are way off the Government’s target of 60% domestic content, and the negligible resources in the Budget simply do not measure up. On the automotive sector, I want to say something positive: it is good that the Government have brought forward the date of the petrol and diesel phase-out to 2030, which is what we called for. But I say to the Business Secretary that the rhetoric of ambition is not matched by financial support for this crucial sector. The Society of Motor Manufacturers and Traders said in reaction to the Budget:

“This is an opportunity lost”.

Germany is investing a total of €7 billion for transformation; we are way off that. The Government seem almost allergic to support for these sectors.

Let us take another area that everybody agreed could create hundreds of thousands of jobs, and I do not think the Business Secretary mentioned this either. It could help people in every community in our country: home insulation and retrofitting. We need a transformation of our housing stock. People may forget that the flagship policy of the Prime Minister’s 10-point plan was the green homes grant. The Business Secretary was given personal responsibility, as the Minister of State, for the green homes grant. He told us the Government would learn the lessons of the green deal, which had been a complete disaster:

“We’re completely focused on trying to make this a much better roll-out, and we’ve learned our lessons…We need to make sure that the right projects are identified, and that we can get the money out”.

It would “pave the way”, he said,

“for the UK’s green homes revolution.”

What has happened? The project has been a complete fiasco on his watch: contractors not paid; installers forced to make lay-offs; homeowners unable to get the grants—not a long-term comprehensive plan, but a piecemeal, privatised approach characterised by shambolic delivery on his watch, and he said not a word about it. He would be welcome to come in and say something about it now; he obviously does not want to. And no wonder: now the Government are cutting more than £1 billion from the green homes grant scheme as it has been such a disaster.

Is this just an accident? No, it is not. The failure on the green homes grant and on green manufacturing is all part of the same problem. The Government are good at talking about a green revolution; they will the ends, but not the means—a proper, thought-through industrial strategy. Indeed, tragically, we now have a Secretary of State for Business, Energy and Industrial Strategy who does not believe in industrial strategy. If I can put it this way, he is half the Secretary of State he once was. Any self-respecting organisation would have asked him in the interview when he was applying for the post of Secretary of State for Business, Energy and Industrial Strategy—although Secretaries of State do not exactly apply, they are offered the job—“Do you believe in industrial strategy?”

We got suspicious when in one of his first acts he tore up plans for the industrial strategy White Paper, and we thought, “How curious.” Then on Thursday we found out he had abolished the Industrial Strategy Council set up by the right hon. Member for Maidenhead. I hope the right hon. Lady will not take it amiss if I say that I admired some of her work, and this is one of the things I admired. I pay tribute to her and the right hon. Member for Tunbridge Wells; they learned the lessons of our history and said, “We need Government, business and unions working together on this joint enterprise, coming together to address the challenges our country faces.” And, goodness me, do we need this now as we seek to recover from coronavirus.

I have to say to the Business Secretary, who is new to his job, that this decision has caused consternation—I do not think that is too strong a word for it—in businesses up and down the country. Make UK said that it causes

“significant concern and frustration within manufacturers of all sizes across the UK.”

The director general of the British Chambers of Commerce said that the strategy’s demise was a

“short-sighted step that ministers will come to regret”.

All around the country, thanks to the work that was done, local chambers of commerce and local enterprise partnerships have spent years working on local industrial strategies. Now they are wondering what they are supposed to do with them, because the strategy seems to have fallen out of favour.

People might think that is just an accident. It is not an accident. I know that the Business Secretary dismisses his past pamphlets as the work of a maverick Back Bencher, but it is not a coincidence, because this—it is very interesting—is what he wrote:

“The draining of effort from our psyche has been replaced by a sense of entitlement.”

I do not know quite what that means. He continued:

“It has also led to a false belief in the value of industrial policy.”

I thought he had put all that behind him, but clearly not. He is so ideological—so dogmatic—about the free market that he had to get rid of the industrial strategy, and therefore he cannot deliver the partnership between Government and business that the country needs.

Let us turn more generally to business support. Businesses have made huge sacrifices in this crisis, as I said, and they face huge challenges in recovering from the pandemic, added to which are the billions of pounds of red tape as a result of the implementation of the Brexit deal. Even when the health crisis is over, businesses will take a long time to recover. We welcome some of the measures talked about by the Business Secretary, but there are still important groups that I believe are left out: two thirds of the excluded self-employed are not helped by this Budget, including limited companies, many freelancers and others; supply chain businesses are still left out; and whole sectors, such as the wedding industry, are ignored. Their plight will hold back the recovery.

We know that business debt is one of the biggest threats not just to individual businesses but to the recovery as a whole. Some £70 billion of business debt has built up during the crisis. In December, the Federation of Small Businesses reported that the proportion of those businesses describing their debt as “unmanageable” was 40%. The OBR says that, on current plans, the Chancellor will have to write off £27 billion of those loans.

In these circumstances, a sensible Chancellor would have been creative, yet he still refuses to budge. We have a scheme from the Chancellor with no links to profits, no ability to restructure and no ability for management or workers to develop creative solutions. He is just leaving it to the banks. Well, even the banks are telling him that that is very risky. If we face a wave of insolvencies, it will be at the Chancellor’s door. The danger is that this holds back the recovery, and it certainly fails the Bevin test.

Many of the businesses facing those debts are on our high streets, in retail. What is the single biggest long-term change that those businesses require? It is to address the deep unfairness that high street shops face against online retailers. I am sure that the Business Secretary is familiar with that problem. The Government launched a review of business rates not in the last Budget, not in the Budget before, not in the one before that, but six years ago. In fact, they launched the review so long ago that I was Leader of the Opposition when they did so—it is that long ago! A long-term Budget would have finally taken action in this area, but instead we got more delay.

I turn to the measures that were taken. On the so-called super deduction, we will welcome any measure to help business, but I point out, as we think about our capital stock and investment, that the OBR says that that measure

“does not affect the long-run level of the…capital stock”.

In other words, it will make a difference to the timing of business investment, but in fact, according to the OBR, business investment is expected to fall significantly in 2023 and 2024, and there are real questions about why this measure is targeted just at plant and machinery, which is only one fifth of business investment. Then we have freeports, which have been tried for 30 years. I am afraid that all the evidence is that, at best, they may displace economic activity from one area left out of prosperity to another a few miles away.

The problem is that the Government simply do not get that we cannot build private sector success on the back of public sector austerity. The cuts of the last decade have made local services worse, squeezed demand and undermined the crucial infrastructure of business success. People might wonder, “Well maybe they’ve learned their lesson.” I fear they have not. Again, this was not very clear from the Budget on the day, six days ago, but in a year’s time, for many of our public services, it will be austerity all over again. Next year, for current services in transport, housing and local government, and other so-called unprotected areas, public spending will be cut in real terms by £2.6 billion. Let us be clear: growth is anaemic, because their measures are so weak, so they turn to a strategy they tried from 2010 of cutting current spending and raising taxes on ordinary families. I fear they have not learned the lessons. They cannot grow the economy if they are giving tax cuts with one hand, but cutting the services that communities and businesses rely on with the other.

The issue is not just about resources, but about who spends them and where they are spent. We are the most regionally unequal country of any major developed economy and the most centralised. The levelling-up fund is a centralised pot of money to be determined by Ministers, and we are starting to discover where the money is actually going.

Salford is the 18th most deprived area in the country, but it is placed not in the category of most need—category 1 —but in category 2. Barnsley is the 38th most deprived area and is also in category 2. Richmond is 256th out of 317 for deprivation, but it happens to cover the Chancellor’s constituency, so it has found its way into category 1. The Government have said this is based on objective criteria, so what are they? Again, I am very happy to give way to the Business Secretary if he wants to explain what these objective criteria are. If it is all above board, why have they not published the criteria? Of course, they have form on this—the towns fund, the crony outsourcing of contracts to donors. The British people have a right to expect that the money meant for the most deprived areas is spent in the most deprived areas.

Ministers do not get the role for Government, they leave it to the market; they cannot tackle the inequalities we face; and, far from leaving austerity behind, for many it will look like austerity, feel like austerity and it will be austerity.

Of course, we have the most egregious example of all in the decision to cut the pay of nurses and NHS staff. They more than anyone have been the heroes of this crisis: they have put themselves in harm’s way for all of us. The Government promised a pay rise in the NHS plan. They did not just promise it; they legislated for it and they walked through the Lobby a year ago to vote for it. The Business Secretary was put up on “Question Time” on Thursday, as this decision was breaking, to try to justify this broken promise, and this is what he said:

“When I look at people in the hospitality sector, in aviation, in retail, many of them are very…worried they won’t…be in a job in two or three months.”

[Kwasi Kwarteng]

indicated assent.

[Edward Miliband]

He nods. As if that is somehow a justification for cutting the pay of nurses. What is the world in which their plight justifies cutting the pay of our nurses? I have never heard anyone, in a year of discussions, in any of those sectors say to me, “I’m finding it hard, so Government should cut nurses’ pay.” People would only say that if they believe in a race to the bottom or they believe in levelling down.

Before the Minister says everybody needs to tighten their belts, he should be careful, because it turns out there is plenty of cash to spend millions on a Downing Street makeover for a media briefing room that has not been used; to spend hundreds of thousands of pounds to pay off the man the Home Secretary was accused of bullying; and to give Dominic Cummings a 40% pay rise. The truth is it is one rule for them and another rule for everyone else. Let them not ever try again to tell people in this country that we are in this together.

Beneath the rhetoric, the Government cannot be the answer to the problems of the country. They may have produced a document charting 10 years of failure on productivity, but they have not changed their view. The answer to 10 years of failure cannot be more of the same. This should have been a Budget with a plan to respond to the climate emergency by creating the jobs of the future; and a Budget with a plan to help business through the crisis and beyond with debt restructuring, providing a decent pay rise for our key workers and dignity in the social security system, rather than plunging the most vulnerable into deeper poverty. This is a Budget of low ambition for Britain. The post-war generation would never have accepted such a meagre vision as that presented by the Chancellor and the Government. They never would have, and neither should we, and that is why we will vote against the Budget tonight.