Great British Energy Bill

Debate between Lord Cameron of Dillington and Earl Russell

Committee stage
Monday 13th January 2025 Lords Chamber

[Earl Russell (LD)]

My Lords, I rise to open this group of amendments, all on consultation and oversight, and to move my Amendment 66 in this group. Amendment 66 seeks to prevent the Secretary of State from directing GB Energy unless they have previously delivered an Oral Statement to both Houses of Parliament. Our view is that this is a reasonable check and balance on the use of these powers. My amendment does not stop the Secretary of State from giving strategic directions; it simply requires that, before doing so, the Secretary of State must have previously given this Oral Statement to both Houses.

We recognise that, for the Government, this is a reserve power that would be used only in emergencies. We also recognise that the Bill as written requires the Secretary of State to have previously consulted with GB Energy and any other persons the Secretary of State considers appropriate, and that the directions must be laid before Parliament. Our concern is that these are both very powerful controls given to the Secretary of State and, even with the condition to lay the direction before Parliament, that is done only after the direction is given. There is no opportunity for Parliament to discuss in any form the direction given or the reasons for it, or to have any opportunity to amend it before the direction is given to GB Energy. Parliament also has no say or chance to contribute to the form the direction should take. There is no way that Parliament can change the shape of it or amend it. These powers are absolute: GB Energy is directed in statute that it must comply with the directions given under this part of the Bill.

I draw the Committee’s attention to the fourth report of the 2024-25 Session of the House of Lords Constitution Committee, published on 28 November, which says of these provisions that,

“we are concerned that clauses 5 and 6 amount to ‘disguised legislation’. … This is of constitutional concern because there is no parliamentary oversight over the making of the statement of strategic priorities or the directions to Great British Energy”.

I must admit that I have to agree with that assessment. Our view is that, if there is a level of need such that directions from the Secretary of State are required, then there is also a level of concern such that a Statement should be provided to both Houses of Parliament.

When matters have gone this badly wrong, it is also important that Parliament should be given the opportunity to scrutinise what went wrong and why and what proposals the Secretary of State is bringing to make them right again. It is important that Parliament is given the right to look at how the new plans might work in practice and to be able to advise and raise objections with and suggest improvements to the Secretary of State. The Minister may come back on this amendment and may speak of this being a reserve power. He may say that these will be used rarely, if they are ever used at all; but when they will be needed, they will be needed urgently. The Minister may also argue that the Secretary of State would have previously consulted with GB Energy and others as the Secretary of State saw fit. This is all correct, but consultation in private could amount to no more than delivering the unhappiness on behalf of the Government and instructing the direction to GB Energy. These meetings happen in private, and Parliament is not privy to any of this information or the outcomes.

The Minister may also argue that these powers have been used in—and, indeed, directly copied from—the nuclear energy Bill. To that, I might kindly argue that nuclear accidents and nuclear emergencies are of a different order of magnitude to our renewable sector, although I do recognise the need for urgency when it comes to our energy supply and energy security. I also recognise that GB Energy will have a role in the nuclear sector—although that is to be strictly defined as yet—and, if the Minister wishes, a government amendment to my amendment could call for an exemption for either a nuclear accident or a national energy security emergency. I would be interested in the Minister’s response to my amendment, and I would be happy to discuss this with the Minister prior to Report.

For all other cases, my view is that an urgent Statement can be tabled in both Houses in a matter of mere days, and this can run concurrently while the Minister fulfils his other obligations in respect of consulting with GB Energy and others. Our view is that this is a carefully crafted amendment which seeks to balance the need to address emergency issues against the need for proper and full parliamentary scrutiny to take place. These may be reserve powers, but they are absolute powers, and they are under the sole control of the Secretary of State. They are enacted after consultations and are merely reported to Parliament after they have been enacted.

I ask the Government to think carefully. I know that they might feel that these powers are safe in their hands, but how would the Minister feel if, for example, Labour were to lose the next general election and these powers were in the hands of another Administration? I think it is in that light that the Government should reflect on whether there is a need for a further check and balance on these powers.

Turning to the other amendments in this group, Amendment 87, in the names of the noble Baroness, Lady McIntosh of Pickering, and the noble Viscount, Lord Trenchard, goes further than my amendment. It says:

“A Minister must table a motion for resolution in each House of Parliament on any directions given to Great British Energy under this section before the directions are adopted”.


I am generally supportive of this amendment, but I have two concerns about it. First, holding a vote will take more time. Secondly, if Parliament, for whatever reason, decided not to approve the directions, I wonder what the consequence would be, because these directions are only given in emergency situations. That is an unlikely consequence, but I do not necessarily agree that having a vote actually helps in this case. What I am interested in is parliamentary scrutiny and conversation, not Parliament having the right to have a vote on this issue.

Finally, Amendment 86, in the name of the noble Lord, Lord Cameron of Dillington, amends Clause 6 by adding that consultation should take place with the National Energy System Operator, the Climate Change Committee and the Gas and Electricity Markets Authority. This amendment is helpful, but to my mind it does not resolve the issue; the issue is one of parliamentary scrutiny, and Amendment 86 does not provide further parliamentary scrutiny. The heart of this, for me, is simply having greater opportunities for parliamentary scrutiny while not delaying emergency actions. That is what I am trying to balance. I beg to move.

[Lord Cameron of Dillington (CB)]

My Lords, Amendment 86 in my name is, as noble Lords will realise, very similar to Amendment 56 in the name of the noble Baroness, Lady Hayman, which was spoken to last month by the noble Lord, Lord Ravensdale. The point is that we all have concerns about the overwhelming statutory powers of the Secretary of State to control, and give random formal directions to, GBE. As I said at Second Reading, we are worried that modern politicians are no longer likely to have had experience of running a business, particularly an investment business, which is what this is. On the whole, the same applies to civil servants who might be advising the Secretary of State. They also usually have little experience of the nitty-gritty of day-to-day private sector business and its associated hour-by-hour assessment of risk and, more to the point, when to take that risk. In other words, you cannot always be totally safety conscious.

Probably the key person with whom the Secretary of State should be consulting is a private sector investment analyst, or even a team of private sector investment analysts, as the noble Lord, Lord Petitgas, was saying early on in the previous discussions. That might be hard to spell out on the face of the Bill, so I will leave that one hanging. As noble Lords can sense, however, I am not at all happy that a politics-orientated—maybe even a party- politics-orientated—Secretary of State of either party should be able to give any direction at all on the issue of practical investment to a hopefully business-orientated board of GBE. I support Amendment 68 in the name of the noble Earl, Lord Russell.

The next thing to say is that Clause 6(3)(b) is superfluous. It states that the Secretary of State should consult

“such other persons as the Secretary of State considers appropriate”.

It is legally meaningless. The Secretary of State could take it or leave it. If he consults with no one, he can claim he did not consider anyone appropriate, so he is under no obligation to consult anyone, apart from Great British Energy, as it stands in Clause 6(3)(a). We therefore need some more specific recommendations.

It is of course right that the Secretary of State should have to consult GBE—after all, it will implement whatever direction he or she gives it—but the Secretary of State should also consult NESO. After all, it is responsible for driving the delivery of our power through the national grid and other transmission companies—we discussed this on another group—so, clearly, it needs to be consulted.

Then there is the Climate Change Committee, which is in very close touch with the state of play of the progress to net zero. It is also in touch with the latest science and knows the priorities of what is most needed to get us to net zero. It will have a view on what could or should be the essential focus of GBE, so it should also be consulted.

Then of course there is Ofgem, which represents the consumers and is their voice, so it seems only right that it should also be consulted on any formal direction from the Secretary of State to GBE. There may be others, and I take the point from the noble Earl, Lord Russell, about the fact that my list is of consultants, rather than Parliament, which might be able to influence the direction of the Secretary of State in a more formal way—although I hope that a consultation exercise would also influence his decision-making process.

In his response to Amendment 56 last month, the Minister seemed to say that the amendment was unnecessary because the Secretary of State would be in permanent consultation with all the organisations involved anyway, but he was at that time talking about the consultation on the strategic priorities in Clause 5 and here we are talking about later specific directions given by the Secretary of State to GBE. After all, the Government themselves put Clause 6(3) in the Bill, so they must have thought that highlighting the importance of consultation, and whom it is with, was important and necessary. In my view, they did not make it specific enough, or possibly wide enough, so I hope they can accept that they should enlarge their constituency of consultees.