European Union (Withdrawal) Bill

Lord Cavendish of Furness Excerpts

Committee: 11th sitting (Hansard): House of Lords
Wednesday 28th March 2018 Lords Chamber

In 2000—the first year of our National Assembly’s existence, when I was leader of the opposition there, and the first year of the European objective 1 funding for Wales—the Assembly expected to receive from Brussels several hundred million pounds to finance EU projects. The money that Brussels sent for the benefit of Wales was dispatched via the UK Treasury and, surprise, surprise, it did not come through to Wales. After painstaking inquiries were made, it became clear that the Treasury had no intention of passing this money to Wales—

[Lord Cavendish of Furness (Con)]

I am grateful to the noble Lord for giving way. Does he accept that those of us who live in Cumbria have watched with huge envy the largesse that has been directed at Wales?

[Lord Wigley]

I have no doubt that Cumbria has its problems, and I have no doubt that people from Cumbria will speak up on its behalf. I support entirely that Cumbrian needs should be answered on a needs basis; we are arguing for exactly that for Wales. The current Barnett formula, as this House has recognised, does not provide that needs-based system for funding. So I accept entirely what the noble Lord says.

The point that I was making was that, back in 2000, the Treasury claimed that it already funded ambitious regional economic projects and that the European cash would be gratefully received as a contribution towards such spending. I sought clarification from officials at 10 Downing Street, but no clarification or assurance was forthcoming. In March 2000, I went to Brussels and met the EU regional commissioner, no less than a certain Monsieur Michel Barnier. He just could not believe what I was saying, since the EU funding was provided on the basis of additionality. He asked his officials—yes, those much-derided Brussels Eurocrats—whether what I said could possibly be true. They confirmed my account, and Mr Barnier asked me to give him a couple of months without making political capital on the issue, in which time he would do his best to sort it out.

The eventual outcome to this incredible episode was, as I may have previously mentioned, that as part of his spending review in July 2000 the then Chancellor Gordon Brown announced that the UK Government would be making a payment of £442 million to the Assembly to settle the account. Thereafter, Wales received the money from Brussels, which it had a right to expect.

So please do not tell me the nonsense about Wales being able to trust the Treasury in London more than it can trust Brussels. Such a claim flies in the face of our bitter experience. Unless we have safeguards built into law, there is no reason for us to believe that we can trust the UK Treasury or its Ministers with our future financial well-being. That is why I have proposed amendments to the Bill. If Wales, in the wake of Brexit, is to be thrown back at the mercy of Whitehall, God help us. I beg to move.

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[Lord Adonis]

I endorse everything that my noble friend Lord Liddle has said. Always when the House debates a Bill at length, certain themes appear, and the themes and patterns can often be of some significance. One of the most significant themes that has appeared in your Lordships’ consideration of this Bill is how weak the voice of England has been in our debates compared with the voice of Scotland, Wales and Northern Ireland.

There has been only one substantive debate about the interests of England after EU withdrawal and how it is handled, which was the debate initiated by the noble Lord, Lord Shipley—significantly, a former leader of Newcastle City Council—on 19 March. It was a very significant debate in the form that it took. What came through very clearly in the debate was that the noble Lord, Lord Shipley, and other leaders of local authorities in England, including the noble Lord, Lord Porter, who sits on the Conservative Benches and is the leader of the Local Government Association, had far more confidence in the EU’s processes of consultation through the Committee of the Regions than they did in any institutional arrangements for consultation between Her Majesty’s Government and local authorities in England.

I am delighted to see the noble Lord, Lord Bourne, in his place—I think that he may be responding to this debate. In his characteristic way, he made a very constructive response to the debate, saying that the Government were considering consultation arrangements post-EU withdrawal with local authorities in England. I took it to be a very significant statement when he said that that might involve new consultative machinery, including possibly a new consultative body between the Government and local authorities in England. I have to say that the fact that it takes EU withdrawal for Her Majesty’s Government to produce proposals for formal institutional consultation between the leaders of local authorities in England and the Government is a pretty damning commentary on the state of our constitutional arrangements in this country. One of the themes that comes through very strongly from Brexit is that English local government and the regions and cities of England are essentially government from London in a colonial fashion, in much the same way as Scotland and Wales were before devolution. One of the very big issues raised by Brexit is that whatever happens over the next year, whether or not we leave—and I hope we do not—Parliament is going to have to address with great seriousness in the coming years the government of England as a nation but also the relationship between this colonial-style government that we have in Westminster and Whitehall and local government across England as a whole.

The one telling exception to this pattern is London, because London has a directly elected mayor and the Greater London Authority. As a former Minister, I know that the whole way that London is treated is radically different from the way that the rest of England is treated because it has a mayor and the GLA. When the Mayor of London phones Ministers, sitting there with 1 million votes—somewhat more than my noble friend has as the county councillor for Wigton; I know he has done very well but he does not sit there with quite so many votes—I assure noble Lords that Ministers take the Mayor of London’s call.

I remember vividly that when I was Secretary of State for Transport I met the then Mayor of London, who is now the Foreign Secretary, and he did not know who the leader of Birmingham City Council was. It only happens to be the second largest city in England. That is a very telling commentary on the state of the government of England. How England is going to be treated is massive unfinished business in our constitutional arrangements, and Brexit has exposed a whole set of issues relating to the government of England that will now have to be addressed.

[Lord Cavendish of Furness]

The noble Lord is making an important point about devolution, with most of which I agree. Does he accept that this Government have really gone out of their way to try to devolve power and that in many cases, as I think he would accept, it is the people on the ground who have refused and rejected it?

[Lord Adonis]

My Lords, I am not seeking to make party-political points in this debate; this issue is going to embrace us on all sides of the House. I note, though, that at the moment we still do not have proper arrangements in place for what is going to happen over the mayoralties in the great county of Yorkshire, which is a hugely important set of issues. There is massive disagreement taking place between different cities in Yorkshire and the Government about how this should be handled. At the moment we still do not have strong powers for any of the mayors outside London. The treatment of the counties of England that are not going to be embraced by the new city mayors is very problematic in the current arrangements, partly because it is genuinely problematic. We have never been able to resolve the issue about how you devolve to local government in England outside the major cities.

This is going to be a big ongoing source of debate, and rightly so. As these debates have demonstrated, we have done much better by Scotland and Wales in recent years, not least because they now have their own devolved Parliament and Assembly. We have done our very best to ensure consensual power-sharing government in Northern Ireland although, to our great regret, the Assembly is not sitting at the moment. Before long we are going to have to start giving equal attention to the government of England.

--- Later in debate ---

[Lord Foulkes of Cumnock]

Thank you very much. There was a huge measure of support there, principally from the Cross Benches. I do not think I have done anything to offend the Cross Benchers; quite the reverse, I was keeping them amused earlier on.

However, this is a serious point. Not only are we taking a lot of time dealing with the Bill, including Wednesday mornings, but we are spending a lot of money. My honourable friend in another place, Stephen Doughty, got an Answer recently that stated that £395 million has been transferred to the Home Office just for dealing with Brexit. Just the process is taking up a lot of money. In fact, we ought to have more Questions and Answers about exactly how much is being taken up by the actual physical process of dealing with this, including civil servants and travel. I understand that Mr David Davis does not like to travel by Eurostar so takes charter flights to Brussels, so the costs are mounting day by day and week by week.

My last point is more general. We now know that the leave campaign has been guilty of fraud and continues to be under investigation by the Electoral Commission. We now know that money was transferred illegally from the leave campaign to the BeLeave organisation, and that unfortunately some of my colleagues and former colleagues in the Labour Party were involved in that because one of them, a former MP, was a director of the Leave campaign. I think it is particularly reprehensible that she was involved in that.

That brings me back to the point made not by the noble Baroness, Lady Humphreys, but by the noble Lord, Lord Roberts, about if Brexit goes through. People are becoming increasingly disillusioned by the way in which we were duped during the referendum campaign, and that strengthens the case for having a new look—

[Lord Cavendish of Furness]

The noble Lord will remember from an earlier debate that it seems that Euratom was understood in detail in Yorkshire by not tens or hundreds but thousands of people. I think people were probably not duped.

[Lord Foulkes of Cumnock]

That is a matter of opinion. More and more research is being done, including recently by an organisation whose exact name I am trying to remember which carried out some work, about which I had an email this morning, showing that people who voted leave did so for a whole variety of reasons, unconnected in some cases to the whole question of the EU. That is one of the problems of referenda generally, as we have discussed before. Still, as we discussed earlier, if the decision was made by the British people, there is a very strong argument that it needs to be undone by the British people. We need to look at that again as the arguments become even stronger.

To return to the amendment, I hope we will get some specific promises and details from the Minister. As I said when I started, he has been known for his credibility, sincerity and honesty. I hope we will see that again today.

[Lord Thomas of Gresford]

My Lords, I have a specific question for the Minister: do the Government accept the proposition, put forward so clearly by the noble Lord, Lord Wigley, in introducing the amendment, that they are bound by the promises made by the leave campaign? They say, “It is the voice of the people that we are following”. The Government had a number of choices that they could have made, but in fact they have chosen to follow a model that must bring great delight to the most extreme Brexiteers. If they do that, they are bound by those promises, I submit—I accept what the noble Lord, Lord Wigley, said.

It is suggested—this is the weak and feeble argument put forward by the leave people these days—that it did not make any difference, and that what they said really had no impact whatever. Before the people spoke and before we heard the voice of the people, the people listened. And what did they listen to? They listened to a universal lie about the National Health Service, that it would receive £350 million a week. The noble Lord, Lord Liddle, has referred to this as “lying”, but I prefer the word “cheating”, which has been used elsewhere in this building this week. The campaign, we now learn, was prepared to send out contradictory messages to targeted people. We do not know what those messages were and we do not know who the people targeted were, but that was cheating. So when the people spoke, they had listened to the lying and cheating propaganda that had been put forward.

Let me be more specific about Wales, where specific promises were made. Wales has been the net recipient of £650 million a year from European funds. That is not something to be proud of; it is because Europe recognised the needs of Wales, and gave money in structural funds and agricultural support that addressed those needs. I will not enumerate precisely what they are, because my noble friend Lady Humphreys has already covered that ground quite fully.

There is a moral imperative about this Government: if they are going to campaign for the sort of Brexit that the most extreme Brexiteers want, they should fulfil those promises, and make it clear in the report that the amendment calls for. In Wales it was said by leave campaigners, in terms, “You will not lose a penny”; that was said widely, across Wales, in all the campaigning that took place.

[Lord Cavendish of Furness]

By whom were these promises made? One problem about a referendum, the principle of which so many of us disagree with, is that it is not a case of a Government making promises that they then have to honour. I do not remember being told about not receiving a penny less. Also, I think that the noble Lord might desist from the extraordinary use of the word “extreme” Brexiteer. You cannot be 52% in the European Union; you are either in or out under this absurd and very unpleasant system of a referendum.

[Lord Thomas of Gresford]

I have the greatest respect for the work that the noble Lord does in Cumbria. Indeed, I feel very much for Cumbria and the north of England for the problems that they have, but they did not have made to them the specific promises that campaigners in Wales made. The Government have picked up the mantle, however you look at it, of the leave campaign. As I have said, they had choices. They could have stayed within the single market and campaigned for the customs union, but have chosen not to. That is why I wholly support the amendment proposed by the noble Lord, Lord Wigley.

Feed-in Tariffs (Amendment) (No. 3) Order 2015

Lord Cavendish of Furness Excerpts

Tuesday 2nd February 2016 Lords Chamber

[Viscount Hanworth (Lab)]

My Lords, the energy policy of this Government is in utter disarray. One can take no pleasure in their discomfort; the adverse effects will be felt by all of us in the immediate future and in the longer-term.

The Government ought to have taken a strategic approach to the supply of energy. The explanation of their failure to do so lies partly in their ideological tenets and partly in the mistaken lessons that they have drawn from a previous experience. The experience of denationalising the electricity industry has led them to believe that investment decisions could be left to the market. At the time of this denationalisation there were ample supplies of North Sea gas and the private companies were able to invest cheaply in gas-powered turbines for generating electricity. When these were placed alongside the existing conventional coal-fired power stations, there was an ample supply of generating capacity. With the decommissioning of the coal-fired power stations, this is no longer the case.

The Conservatives have come to believe that this experience provides a model for an energy policy. They have convinced themselves that a centrally directed strategic policy for energy provision is a thing of the past. They persist in believing that the private sector can be relied on to deliver a mixed portfolio of generating technologies. They imagine that in this way they can avoid the risk to government of choosing and pursuing an inappropriate technology.

The feed-in tariffs, which we are discussing today, became an important part of the laissez-faire approach when it was recognised that certain infant technologies might need some assistance. Households and small enterprises have been given incentives to pursue small-scale generation. The incentives consist of a pro rata payment for each kilowatt of electricity they generate, together with a so-called export tariff, which is supposedly tied to the amount of electricity that is fed into the grid. In the absence of a meter to determine how much electricity has been exported, it is assumed that 50% of the electricity generated by photovoltaic cells will be exported and that 75% of the electricity generated by wind turbines will be exported. The intention was gradually to reduce the financial support given to the infant industries via a process described as “degression”—a neologism unrecognised by most dictionaries.

Instead of a steady reduction in the support for small-scale generation, the Government have reacted to the success of the scheme and its consequent expense by proposing a step change in the support, which virtually abolishes it. Their reliance on a laissez-faire market-oriented policy has exposed the Government to the unintended consequence of a vigorous expansion of photovoltaic generation. There is now a significant industry devoted to the installation of the equipment and a major import bill to be paid to the suppliers of solar panels, who are predominantly the Chinese.

Why have the cuts been so drastic? The reason is that the expenditure in support of the feed-in tariff threatens to pre-empt too large a proportion of the expenditure allowed under the so-called levy control framework, which limits the expenditure on subsidies that are levied from consumer bills. The Government wish to devote these funds to other purposes, which are their support of nuclear power and fracking. However, by some quirk of European Union legislation that could easily be disregarded, the funds devoted to supporting infant enterprises under the levy control framework are accounted as government taxation and government expenditure. This is a matter of statistical classification, which would be regarded as unimportant were it not for the Government’s obsession with the nominal size of the budget and the budget deficit.

The effects of the withdrawal of support have been acknowledged in the Government’s own impact assessment. An infant industry will be threatened with extinction and many people will be thrown out of work.

The advent of photovoltaic electricity generation is important because of the manner in which it can stimulate further technological advances, as well as the way in which it promises to change consumer behaviour. The technology in question is that of smart metering, which will allow the price of electricity to be varied according to the level of demand, and which will inform the consumer accordingly. Consumers will become increasingly aware of the cost of grid-supplied electricity and of the desirability of avoiding its use during periods of peak demand. With smart metering, it should become self-evident to consumers that they should deploy energy -intensive electrical appliances only in off-peak periods.

The disarray of the Government’s energy policy, of which I spoke at the outset, is the result of their reliance on willing providers to undertake the required investment in electricity generating capacity. But there has been a dearth of willing providers. In consequence of their failure to invest, the large energy suppliers should bear the cost of maintaining the present feed-in tariffs.

The prospective investors in nuclear power are the nationalised and semi-nationalised energy corporations of two foreign countries; namely France and China. There are now doubts regarding the commitment of EDF, the French national electricity supplier, to build the nuclear power station at Hinkley Point. If the French withdraw from this project, it seems likely that the Chinese will do likewise. What then will remain of the Government’s energy policy? They will have to rely on increasingly expensive supplies of gas. Their ambition to derive ample supplies of gas by fracturing the ground under our feet appears to me an implausible one. The alternative supplies of gas, which are from the Middle East, the north Atlantic and Arctic Russia, are beset by geopolitical hazards. Moreover, if we are to rely on imported gas to satisfy our energy needs, it will not be possible to fulfil the commitment to staunch our emissions of greenhouse gases.

I strongly support these Motions, which oppose the cuts in the feed-in tariffs, and I call on the Government to think again.

[Lord Cavendish of Furness (Con)]

My Lords, I rise to oppose both these Motions, but especially that in the name of the noble Baroness, Lady Featherstone. I should perhaps declare an interest, in that I have been a beneficiary of feed-in tariffs, albeit not with solar.

Feed-in tariffs cost about £1 billion a year—last year it was £851 million—and most of that goes on solar. That is a considerable sum of money, and every penny of it is added to the bills of electricity consumers. I find it significant and surprising that speakers so far have spoken up for the producers rather than the consumers. Adding that money to consumers’ bills hits the poor harder and rewards the rich, because electricity makes up a bigger part of the expenditure of the poor. So it is a regressive transfer of money from the poor to the rich.

What are we getting in return for this expenditure? We get rooftop solar running at 10% load factor, which is less than 1% of final electricity consumption. That is a trivial trickle. Most of it is generated on a summer’s day, rather than on a winter’s night when it is most needed.

The Minister’s own department’s renewable energy planning database shows that the UK has already given planning permission for sufficient renewable energy capacity to overshoot the 110 terawatt-hours required to meet the 2020 target contribution for electricity. The overshoot, if it is built, would be about 35%, but there is no budget for that excess. The department reckons a budget overshoot of £1.5 billion is possible. However, some people calculate that it could easily be £2 billion and that the department is being conservative.

My final point is political. I have checked my party’s manifesto, and it seems to me that the Government’s actions are entirely consistent with it. I am therefore extremely sorry that the noble Baroness should choose quite soon in her career in your Lordships’ House to introduce a fatal Motion. A lot of people are increasingly being left with the feeling that these fatal Motions are not just discrediting your Lordships’ House—they are actually intended to discredit your Lordships’ House.