UK Infrastructure Bank Bill [HL]

Debate between Lord Bourne of Aberystwyth and Baroness Hayman

Consideration of Commons amendments
Tuesday 14th March 2023 Lords Chamber

[Baroness Hayman (CB)]

I declare my interest as co-chair of Peers for the Planet and rise to speak to my Motion 3A, which as the Minister said would reintroduce nature-based solutions into the definition of infrastructure in which the UK Infrastructure Bank may invest.

We had some very helpful conversations after Report and the debates in the other place, and I think we have now reached a highly satisfactory position on this amendment, in no small part due to the Minister’s customary constructive approach to the debates that have taken place in this House, for which I am very grateful.

Of course, the original amendment included the “circular economy”, and I know that there will be some disappointment that that is not included now, but the bank’s strategy is reassuring on that issue. Anyone who listened to the item on the “Today” programme this morning about data centres using the heat they normally have to dispose of to heat up the water in local swimming pools will have heard a lovely example of how we need to put those sorts of issues together.

I thank all the Members of this House who have taken part in the debates, and in particular those who signed the various iterations of my amendment, including the noble Lord, Lord Bourne of Aberystwyth, the noble Baroness, Lady Jones of Whitchurch, and the noble Lord, Lord Teverson. This amendment has had significant cross-party support because of the increased recognition that nature-based solutions have a critical role to play in the fulfilment of the bank’s objectives. The Chancellor’s strategic steer in 2022 encouraged the bank to

“explore early opportunities in nature-based solutions”

and aim to have

“a positive impact on the development of the market”.

The bank has since published a discussion paper setting out its initial thinking on how it can invest in and support the growth of natural capital markets, and I look forward to the results of this consultation.

The discussion paper clearly explains the importance of natural capital as a form of infrastructure and the vital contributions it makes to our society and economy, often in ways which are more cost-effective to the taxpayer. Carbon removals through creating and restoring woodlands, wetlands and peatlands, flood mitigation measures, providing “clean and reliable” water supplies, underpinning our food security and bolstering our resilience to climate change: these constitute numerous examples of how we can deploy nature-based solutions to support our infrastructure and provide social, economic and environmental benefits. There is also an ever-increasing recognition of the key role that nature can play in solving climate change, nature being our biggest asset with which to fight it. Nature-based solutions also provide significant co-benefits, such as jobs and good health and well-being outcomes, with considerable economic advantages.

I welcome that the UK is leading on the Taskforce on Nature-related Financial Disclosures, but there is an average $700 billion funding gap for protecting and restoring nature globally, and evidence that more needs to be done to help market participants mainstream and scale these products alongside growing investor demand. This simple addition to the definition of infrastructure in the Bill sends a strong signal to the markets that the UK recognises this and the Government are serious about taking action to help build and develop this nascent market. It also provides certainty to the bank, which recognises that it has a role in developing capacity towards a pipeline of investable projects and is poised to act. It will encourage others to do the same and further develop the UK finance sector’s position as a leader in this important emerging new market.

As I said, I am very grateful to the Minister and her officials for the support they have given and the resolution that I think we have reached.

[Lord Bourne of Aberystwyth (Con)]

I support the noble Baroness, Lady Hayman, in her proposed amendment and congratulate her on her tenacity in pursuing this issue. She has achieved something notable, and I thank her very much indeed. Account being taken of nature-based solutions improves the Bill and, on that basis, I also congratulate the Minister. My noble friend has proved herself to be a listening Minister, and the Government have taken a very common-sense approach, which improves the Bill. It was previously a good Bill, and it is now a better Bill after changes made in this House and the approach of the Minister and the Government.

I do not propose to detain the House, except to say that I agree with much of what the noble Lord, Lord Teverson, said in Committee and at Second Reading. I regret that we have not gone a bit further, but at least we have an improvement in this legislation. On that basis, I once again congratulate the Government.

Social Housing (Regulation) Bill [HL]

Debate between Lord Bourne of Aberystwyth and Baroness Hayman

Committee stage
Tuesday 6th September 2022 Lords Chamber

[Baroness Hayman (CB)]

My Lords, it may be helpful to the Committee to continue the theme of energy efficiency, rather than going through the amendments numerically, so I will do so. I declare my interest as co-chair of Peers for the Planet. As the noble Baroness, Lady Pinnock, said, I have Amendment 21 in this group, and I am very grateful for the support of the noble Lords, Lord Bourne of Aberystwyth and Lord Foster of Bath, who have added their names to it.

At Second Reading of the Bill in July, there was similar support from across the House—on all Benches—for action on energy efficiency in the social housing stock. The Minister himself described action as a “must”, but I am afraid he stopped there in describing how that action would actually be implemented. As the noble Baroness, Lady Pinnock, said, social housing tenants are among the most vulnerable in the current energy crisis. The Government’s own most recent data shows that 72% of new lead tenants were not in employment; 20% of new lettings were reserved to those who were statutorily homeless. Research by the Energy and Climate Intelligence Unit shows that houses in EPC band D, which are 35% of social housing, will pay £600 more a year under the cap as it is at the moment than those in band C, and forecasts from Cornwall Insight suggest that that could be doubled next year.

The money that we are led to believe will be spent in subsidising—paying for—those bills is money that literally goes up in smoke. The money spent on home insulation and energy efficiency is money that does not have to be spent year after year when we have an energy price crisis. This was recognised by the Government in the clean growth strategy in 2017, when they committed to consultation on minimum energy performance standards in social housing, but we have seen no plan—not even a consultation on a plan or a plan on a consultation. Hence the need to take action in the Bill to put the requirement in primary legislation and get moving with doing this.

As the noble Baroness said, this amendment is more detailed than hers. We have framed it as a duty on the Government to publish a strategy. I hope that others will agree that this is the most appropriate approach. It should not be a duty on social housing providers to improve properties without any government support, nor a duty on government to go into properties that they do not own and forcibly improve them without landlord and tenant consent. A duty for a strategy will require input from social housing providers, tenants and community groups and the specialist and general firms who carry out the work.

The amendment is relatively simple. Proposed new subsection (1) gives the social housing regulator the power to set standards in relation to energy demand—a slightly different approach from that in Amendment 1 —and requires the regulator to have regard to the Government’s strategy on this topic when it does so. Proposed new subsection (2), which is the meat of it, requires the Government to set out an energy reduction strategy, with four key points.

The first is the rollout of low-carbon heat, so that it accounts for 100% of installations by 2035. The low-carbon heat could equally well come from heat pumps or local heat networks. This is simply putting a commitment that the Government have already made, but are not making a lot of progress with, on a statutory footing.

The second is an EPC rating of C for all social housing properties by 2028. The Committee on Climate Change has recommended that year; the Government have suggested 2030, but it is important that we make progress now.

The third point is to have interim targets for the first two points. We have all seen the dangers of putting very high-level commitments out in principle while not seeing any plan for their implementation and no milestone so that we can tell how far we are going. Interim targets would give transparency for tracking the government target for energy-efficiency improvements made each year and would maintain momentum.

The fourth point is a plan to support social housing providers in engaging with one another, the social housing regulator, and a single source of government advice. This is really important. One of the things that people are flailing around for is the best way to do things in the current crisis. It is tremendously important that the Government, who have referred to providing a source of advice, do so urgently, so that we do not all reinvent wheels all over the place. Proposed new subsection (3) requires the Government to consult the Climate Change Committee, which has significant expertise in this area, when producing their strategy—another belt and braces to ensure that we are making progress.

Ideally, we would be tackling energy efficiency across all fields. There is a huge gain to be made there. The noble Lords, Lord Bourne of Aberystwyth and Lord Whitty, and I will be tabling amendments to the Energy Bill for a broader government strategy. However, we can and should make progress now with this particularly vulnerable group of people. As I said, 2017 was the first time that this was mooted by the Government. The adage is that the best time to plant a tree is 10 years ago. The best time to have begun this strategy was five years ago, but the second-best time to plant a tree is today. I hope that the Minister will respond by doing this now.

[Lord Bourne of Aberystwyth (Con)]

My Lords, it is a great pleasure to follow the noble Baroness, Lady Hayman, and to support her in this amendment, along with the noble Lord, Lord Foster of Bath, who has also added his name to it. I declare my interests as published in the register. I am also a member of Peers for the Planet. It sounds like saying that I am a member of Alcoholics Anonymous, not that I have ever had to do that. This is an extremely important amendment.

As has been noted, at Second Reading there was very strong support from around the House for the Bill’s objectives, and I am clear that that will remain the case. There is also strong support from around the Committee for the Government’s commitment to achieving net zero, and for the work of the Committee on Climate Change. What we need to do, through this legislation, is provide some heft to that commitment, because what is lacking, as the noble Baroness noted, is a road map to take us to the very noble aim of net zero. As the noble Baroness, Lady Pinnock, rightly said, since Second Reading, it has become even more evident how important this is—in very graphic terms, with the eye-watering price of energy and energy security centre stage following the dreadful situation in Ukraine. I think that is recognised by the incoming Prime Minister, but I say to the Minister, who has a long list of things to take up with the incoming Prime Minister and Ministers, that this is an opportunity for a very early demonstration of this Government’s commitment to tackling this very serious issue by tackling not just climate change but the energy security issue and, not least, the eye-watering cost of energy that we face currently.

At this juncture it is clear, as clear as it can be, that any action to reduce energy demand is sensible and vital. As is often said, the energy that is cheapest is the energy that we do not use. One thing we can perhaps take some comfort from, in a slightly bizarre way, is that we have got more ground to make up in this country than many other countries in relation to energy efficiency. There is a lot we can be doing; there is massive scope for energy efficiency and, indeed, for demand reduction, which this amendment is geared to. By reducing energy demand, we contribute to the fight for net zero, we contribute to helping ease the massive cost of energy and we also contribute to our energy security. These three pillars are all vital in this battle, and this amendment—a very modest amendment, really—would contribute to all three. The commitment to the low-carbon heat target of 100% of new installations of heating appliances and a minimum EPC rating of C for all social housing is, I believe, achievable and vital.

I appeal to the Government to come forward with a positive programme of engagement with social housing landlords, and advice, also very sensible and provided for in this amendment. I am sure it would have support from all corners of the Committee and would contribute in a very positive way to something that we know our country needs to do. I trust that the Government will demonstrate their commitment to net zero, to easing the cost of energy and to achieving energy security by supporting this amendment. It is a practical, pragmatic, sensible response to the energy crisis, will be seen as such, and will be seen as an early demonstration of the commitment of this Government. So I hope that is what the Minister will say when she responds to this group of amendments.