Former Steelworks Site in Redcar

Lord Harrington of Watford Excerpts

Wednesday 14th November 2018 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

It is customary in Westminster Hall debates to say what a privilege it is to appear in front of the Chair. In your case, Mrs Moon, that is absolutely true. I am greatly honoured to do so.

[Gill Furniss]

Charmer!

[Richard Harrington]

Just currying favour with the Chair—but it is actually genuinely true. One of the most interesting days I have had in this job was spent visiting Mrs Moon and her constituency.

I thank the hon. Member for Redcar (Anna Turley) for securing the debate. These are very important topical points and I congratulate her on the consistency of her representations on this project. The whole area is very lucky to have the MPs that it does—the hon. Lady, my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) and the other MPs who have spoken today. It is also lucky to have the Mayor, Ben Houchen.

There is a bit of an undertone of “who said what where”. That is not for me to go into, but I make a plea to all parties, including those not in the room, that these matters are much better dealt with on a consensual, cross-party basis. If anybody feels that I and my office can help in that, I am very pleased to offer that help.

[Anna Turley]

I concur with the Minister’s comments and I reassure him that the reason for calling today’s debate is to try to move on to the substantive issues of the site. I welcome the positive, constructive tone that we have struck today, because I think that is the only way forward.

[Richard Harrington]

I thank the hon. Lady for that intervention.

I have visited the site, although not recently—I was 17 at the time. I was brought up in Leeds and went on a school trip to visit the Neddy—the National Economic Development Council—in Newcastle, the steel site and the Wilton ICI chemical works nearby. I have never forgotten the scale of it.

I whizzed past the site in my current job, when speaking at a steel conference just next to it in the constituency of the hon. Member for Redcar. A lot of Members of Parliament have trooped up there, as have a lot of Ministers. There has been talk of hollow words, but it is much better that there is a general awareness throughout the Government. The Mayor and other parties involved with the development corporation are regular visitors to the Treasury and other parts of Government, and so they should be. It is part of our democratic system, and we all co-ordinate together; I hope everyone realises that my office is very much part of that. I have certainly had nothing on my desk to do with this project that has been gratuitously turned down, ignored or not taken seriously.

I have been scrawling furiously during the debate to try to prepare to answer the points that have been made. I will try not to go over the history again, as it has been well covered by other contributors. Perhaps for the sake of Hansard it would be convenient if I did, but I think it has been said very well.

The South Tees Site Company is funded by a grant of £118 million, which was granted in the autumn Budget 2017 and includes £48.9 million for improving the site. The point was made—eloquently—that a lot of that money had to be spent, but it is still taxpayers’ money. It did have to be spent, and I hope that it is the first of very much more to come in the future.

There has been talk of different projects and implications that they have been turned down by the Government. My personal experience of doing this job is that I have spoken expensively—I mean extensively—to Liberty Steel. In its case, both those words might be true! I have spoken to it to get a project, which is still very much in outline. It has not been rejected. There has been nothing put in front of us.

It might have been the hon. Member for Redcar, or another speaker, who said that this project is going to Scotland. That is not the case. I am in regular talks with the company and I have been to its offices. I have met the chairman and other officials, several times, with our own experts, to try to get the project to a state where it can be looked at as a serious proposal. This is not a criticism, but it is not yet at that stage. I hope it will be. We meet regularly, and the company knows that the door is open.

As far as INEOS is concerned, its decision was taken for commercial reasons. As has been mentioned, I think it was more of a question of not wanting a brownfield site and a start from scratch, rather than anything to do with this site, the Government saying no or anything like that.

[Alex Cunningham]

I think the Minister will agree that the major impediment in our way—which, if resolved, could sweep away all that doubt—is the issue of land ownership and the associated legal agreements. When is that going to be resolved?

[Richard Harrington]

All in good time. I cannot give the hon. Gentleman a date now, but I will come to that shortly. I will make progress because I want to leave time for the hon. Member for Redcar to sum up.

The £14 million granted by the autumn Budget and the special economic area status for the site are both important. They came about because all those different Departments—including the Ministry of Housing, Communities and Local Government, and the Treasury—are working with South Tees Site Company, the development corporation and the combined authority. We have worked together on the proposals and will continue to do so. The 1,500 jobs quoted are a first step, but I know they are nothing compared to the number of jobs that were lost when SSI went into liquidation and struggled from crisis to crisis.

It is very easy to blame one Government and not the other or to say that the Government could have intervened by putting in a load of money to keep things going, but I have seen the consequences of that. I have seen places in the valleys in Wales where hundreds of millions—if not billions—of pounds were spent on keeping businesses open, and I saw a failed industrial policy in the north of England, where I was brought up. That does not mean that Government do not take part in industry—we are spending more money on research and development than ever before.

I really believe that the industrial strategy, in partnership with businesses, is the future. The reason why there is not a steel sector deal—as the shadow Minister, the hon. Member for Sheffield, Brightside and Hillsborough (Gill Furniss) mentioned—is that industry itself has not come up with its side of the proposals. I am working on this, meeting industry regularly, and am still hopeful, but that is work that must be done in partnership.

The Government responded immediately with support for the site when the closure took place, including a sum of £30 million that was ring-fenced for the statutory redundancy payments. The SSI taskforce, under the leadership of Amanda Skelton, took a leading role and deserves a lot of credit. The hon. Member for Redcar was a member of the taskforce and did a great job.

The clichés about people working together are predominantly true in this case; spats and disagreements come and go. I think it is fair to say that we cannot recreate what was there before—time has moved on. My right hon. Friend the Member for Scarborough and Whitby (Mr Goodwill) made the point about how steel has changed and certain commodity products cannot compete with much lower costs. Of the factors for the industry growing up there—iron ore, steel and water—only one remains. That does not mean that the site does not have a fantastic future—I really think it does. I am delighted that the hon. Member for Redcar quoted Lord Heseltine and former Chancellor George Osborne in different parts of her speech.

The Scottish National party spokesperson, the hon. Member for Motherwell, made a very—

[Marion Fellows]

For Motherwell and Wishaw.

[Richard Harrington]

I was abbreviating—my apologies to the half of the hon. Lady’s constituency that I did not mention. The hon. Member for Motherwell and Wishaw (Marion Fellows) made some good points about apprenticeships, and I am very pleased about the way that apprenticeships in steel are going. I was pleased that all the apprentices at Redcar were found alternative jobs and positions. The experiences of Ravenscraig and Consett were fed into the creation of the solution, with the development corporation and so on. That does not compensate for what happened, but it shows that lessons have been learned.

The master plan is excellent, and proposals for additional funding will be carefully considered. They have to meet public funding guidelines, which I know all hon. Members will accept. The Government’s current position is therefore to commit resources in a number of areas. I accept the shadow Minister’s view that some of that is just hot air and announcements, but that is the way that public sector financing works; there is a principle and then there has to be a business case. I make no apology for that—that is the way it has to work. Business cases are not there to be stopped; they are there to be taken on board.

I really am running short of time—that is my own fault for giving too many compliments to most of the other speakers, which I should not have done—so I will hurry up. The subject of the airport, which was raised very eloquently, is not one that I have really concentrated on. Maybe I should have, but I have not. May I suggest a meeting with the hon. Members who are interested in the airport issue, rather than just giving a vague answer today?

We very much believe in the concept of a local solution, and the Government are very open to specific suggestions from private companies or from the development corporation. I hope we see through all the smoke about individuals—who should be in this or that job, or who said this or that—and come to the collective solution that we all want.

The debate has given me the chance to canter over matters. We must remember that the site is the UK’s largest regeneration opportunity, and if the UK is to develop in terms of its industrial strategy, which we hope it will and fully intend it to do, that will be there. The site has received much publicity thanks to the efforts of hon. Members present, the Mayor and everybody else involved in the development corporation. We know what the challenges are in the special economic area in the Tees valley. Even people who did not watch the documentary on television—I was very disappointed about the lack of a starring role for the hon. Member for Redcar; had I been in charge of casting I would have altered that—will know that these things take a lot of time. Decontamination has to happen first, before a deal with the banks, which I am sure will come about—these are very complex matters. It is not as if the banks are a single entity; there are three of them, with very different views.

The Government are determined to see the site redeveloped in an exciting way in the end, so that it is a flagship for our future industrial strategy and an example for the next industrial revolution as it was for the first.

Hinkley Point

Lord Harrington of Watford Excerpts

Wednesday 14th November 2018 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

It is, as always, a great pleasure to serve under your very competent chairmanship, Mr Hollobone, as I have many times. I hope that the rest of the debate will not be too stressful for you, given the spirit in which my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) intends it, for which I thank him. He has consistently and regularly demonstrated a keen interest in the Hinkley Point C project—formally, at the meetings we have had together, and on visits, and more or less every time I have a cup of tea or coffee in his immediate vicinity. I congratulate him on that.

I also congratulate the other hon. Members who contributed to the debate: my hon. Friend the Member for North Devon (Peter Heaton-Jones), the hon. Member for Ynys Môn (Albert Owen)—it took some time to learn that constituency, but I think I know it now—and, of course, the ubiquitous hon. Member for Strangford (Jim Shannon).

My hon. Friend the Member for Wells (James Heappey), who is also a regular contributor, taught me something that conditioned my view of Hinkley Point and other projects when I had just taken on the portfolio. He told me about his fear that the local content would comprise, basically, a sandwich van at the end of the site. I say that because my hon. Friend for Bridgwater and West Somerset talked about wet bottoms.

[Mr Liddell-Grainger]

Soggy bottoms.

[Richard Harrington]

I shall have to check Hansard. I appreciate your leniency, Mr Hollobone—I am sure Mr Speaker might have thought that was unparliamentary language, but it was not intended to be so.

The serious point I am making is that in all my dealings with EDF, and in all my visits down there and visits to suppliers, I am always keen to stress the point made by my hon. Friend the Member for Wells about the local supply chain, and the fact that these are real jobs. That reflects the points made about the national impact, which we always have to think about.

I am proud to be part of this Government and I asked for the nuclear portfolio—not because it was part of my general energy portfolio, but because I believe it is a brilliant industry in its own right for the future. It has everything that we look for in our industrial strategy: quite apart from the energy side, the industry creates good-quality, high-level employment, and that energy, if produced in bulk—obviously, not hundreds and hundreds of these, but more than one—can reduce the price by 30%. It also has supply chain and export, and is high tech. Before we even get on to the green point, the baseload point and all the other things that are so important, it has a lot going for it.

That is why I was pleased when the Secretary of State and I went to—I must warn you, Mr Hollobone, that this could be difficult for me to pronounce—Trawsfynydd, in Snowdonia in north Wales, to launch our nuclear sector deal. The hon. Member for Ynys Môn nodded, so I am pleased I got the pronunciation right. It has a great future. We have mentioned different parts of the country today, including north Wales and Wylfa, which are important.

Indeed, the hon. Gentleman and I have discussed community benefits for Anglesey. Obviously, the community benefits for Hinkley Point are further down the line because the development is well under way. Those are important community benefits and it is right that those decisions should be made locally. Of course, that can lead the Government into lots of problems, because local communities do not have a consistent view, depending on area.

[Albert Owen]

The question I raised regarding the announcement made in 2013 by the then Department of Energy and Climate Change still stands, and I know that the communities of Bridgwater and of Anglesey are concerned that nothing much has happened since then. Will the Minister reiterate his commitment to that formula so that the Ministry of Housing, Communities and Local Government and the Welsh Government can work with his Department, the mechanism can be put in place and, when the stations are generating, the communities can get the full benefits?

[Richard Harrington]

I am happy to confirm that. I have already met with one chief executive and one lead councillor from the hon. Gentleman’s area, but I would, of course, be delighted to discuss this with him at any time.

The main point today, which my hon. Friend the Member for Bridgwater and West Somerset expressed so eloquently, is how important the nuclear industry is as an industry in its own right to local economies and to the national economy. As far as I can see, EDF is doing an excellent job. There are many British and Northern Irish employees, some of whom I met down there, of different skill levels, and I was pleased to see the number of young girl apprentices, which is also part of our nuclear sector deal.

I am not at all complacent. I think the deal struck at Hinkley Point C was sensible from the taxpayer’s point of view, as my hon. Friend mentioned, because it completely de-risked the taxpayer. We can do other interesting deals in the future for nuclear. At the moment, nuclear power is roughly 22% to 24% of the power output that we need. By 2030 to 2040, as the original power stations are decommissioned or reach the end of their life, that will drop with Hinkley to—again, these are very rough numbers—5% to 7%. There is a big gap.

[Sir Michael Fallon (Sevenoaks) (Con)]

Does the Minister agree that the true value—that might have been a better title than “cost”—of the Hinkley project will not be known until we see some of the cost savings that will be realised at the second station that EDF has built, and indeed in the sequencing of stations that will be built after that?

[Richard Harrington]

My right hon. Friend makes an excellent point, with which I fully agree. On my first visit to Sellafield I was shown the original Calder Hall reactors that were opened in the ’60s. The then Minister said that the electricity would be so cheap that it was not even worth metering it. We have moved away from that, but I believe that, in the long term, this will be low-cost power. As everyone knows, the up-front costs are significant. After that, the marginal costs are comparatively low. As long as there is a reasonable way to finance the up-front costs—which, as the technology becomes more modular and more commoditised, we will be able to estimate more accurately—I totally agree with my right hon. Friend’s point.

I am pleased to respond to today’s debate. I will not forget Hinkley Point C, which is one of the most significant visits I have ever made. It is calculated that 64% of the construction contracts there—it is a huge project—will go to UK companies, and that £4 billion will go into the regional economy over the lifetime of the project. We will not forget that; it is very important to us. I am extremely grateful to my hon. Friend the Member for Bridgwater and West Somerset for bringing the debate to the Chamber.

Question put and agreed to.

Oral Answers to Questions

Lord Harrington of Watford Excerpts

Tuesday 16th October 2018 Commons Chamber

[Mrs Anne-Marie Trevelyan (Berwick-upon-Tweed) (Con)]

16. What steps he is taking to secure the future of nuclear power in the UK.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I thank my hon. Friends for asking this question during Green GB Week. Nuclear power is the key to the UK leading the world in decarbonising its economy, which is why the Government are working hard to secure a good deal at Wylfa, Anglesey and to develop alternative financing models to benefit future projects and implement the landmark nuclear sector deal.

[Trudy Harrison]

Will the Minister recognise the contribution that Cumbria has made to the nuclear industry and commit to working with me and the Moorside strategic partnership to ensure we deliver new nuclear in Copeland?

[Richard Harrington]

One of my most exciting days since I took up this post was spent visiting my hon. Friend’s constituency, and of course I would be delighted to work with her and anyone else in Copeland to develop the Moorside strategic partnership.

[Mrs Trevelyan]

Would the Secretary of State meet me and cross-party colleagues to progress the nuclear decommissioning of our out-of-service nuclear submarines, which are currently decaying in Plymouth, not only to maintain our world-leading skills in this vital nuclear sector, but to develop the export potential for this work, to help meet our global commitment to a cleaner planet and to ensure a continuing increase in the number of nuclear engineers?

[Richard Harrington]

My hon. Friend is correct to bring this subject to my attention. The Ministry of Defence leads the submarine dismantling programme and my Department the civil dismantling programme. I talked to the Secretary of State for Defence only yesterday about co-operation between our Departments, because it will unlock significant opportunities for the UK economy, including exports and skills. Our Department is getting very good at decommissioning.

[Chris Williamson (Derby North) (Lab)]

15. All major forms of renewable energy, such as onshore and offshore wind and solar, are now cheaper than new nuclear, and energy storage is on a similar cost trajectory, so why are the Government wasting billions of pounds on nuclear power?

[Richard Harrington]

The hon. Gentleman should be aware that the Government have a responsibility to ensure a mixture of power sources. Nuclear has a role to play and makes a tremendous contribution to the economy, employing nearly 70,000 people, but renewables are also very important. It is all about a mix and ensuring that the country has secure green energy for the future.

[Martin Whitfield (East Lothian) (Lab)]

As the Minister is aware, the Civil Nuclear Constabulary is an important element of the future of nuclear power. In December 2017, I asked about its pension arrangements, and I understand that we are still awaiting an equality impact assessment from the Minister’s Department. Will its staff have it for this Christmas?

[Richard Harrington]

As the hon. Gentleman may know, I like to give Christmas presents wherever possible. I have met the chief constable and representatives, and I have written to the Treasury. I cannot imagine what Santa will bring, but we are doing our best in the Department to resolve this issue.

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

14. What steps he is taking to support the provision of family-friendly working practices.

--- Later in debate ---

[Sir Henry Bellingham (North West Norfolk) (Con)]

T5. The Minister will be aware that there has been a remarkable revival in the UK extractors and mining sector. What can he and the Secretary of State do to make sure these ventures are environmentally sustainable and command local community support?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

My hon. Friend is very well informed on matters to do with minerals, but this is topical questions, which require quick answers, so I would like very much to meet my hon. Friend and any other colleagues to discuss this issue in detail.

[Andy Slaughter (Hammersmith) (Lab)]

T6. Last year, Shepherds Bush post office was moved out of the town centre into the back of a WHSmith store. We were promised that it would remain a Crown post office, but now it is one of the 74 that is going to be franchised. We also have three branches that are suspended, one for four years. Will the Government do anything about the running down of the post office network?

[Bob Blackman (Harrow East) (Con)]

T10. As we embark on a new nuclear future, it is vital that we have a workforce that is able to deliver the skills and capability. What action is my hon. Friend taking to ensure that young people in particular get the training and opportunities for a career in this wonderful industry?

[Richard Harrington]

I thank my hon. Friend for this question because it is absolutely relevant to our nuclear sector deal, which concentrates very much on the development of skills particularly for young people. I was most impressed on a recent visit to Hinkley Point C by how many young people are in training, particularly the increase in the number of young women involved in nuclear, and I know that will continue.

[Gareth Snell (Stoke-on-Trent Central) (Lab/ Co-op)]

T7. When will the Secretary of State be able to announce a sector deal for the ceramics industry? He will know of the benefits that can be brought to both Stoke-on-Trent and the industry with that deal, and if he is unable to give a date today, will he meet me so we can progress this issue, so that the next time I ask him in the House he can give me a date?

[Richard Harrington]

I have met several times with the industry to discuss a ceramics sector deal, and it is developing. I will be very pleased to meet the hon. Gentleman, as he knows, and with other colleagues with constituency ceramics industry interests.

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

As my right hon. Friend will know, our high streets face unprecedented challenges. Will he therefore join me in challenging the sharp practices of Smart Parking, which operates in the Westgate shopping centre in Basildon? Its charging and fining regime is damaging the viability of shops and fining thousands of people who have all tried to do the right thing.

--- Later in debate ---

[Jessica Morden (Newport East) (Lab)]

T9. The all-party group on steel and metal-related industries has written to the Chancellor ahead of the Budget calling for specific measures to help our steel industry. Will Ministers support these calls and when can we have a proper, much-needed sector deal for steel?

[Richard Harrington]

I am delighted to tell the hon. Lady that I am in regular communication with the steel industry about a sector deal, which is developing thanks to Jon Bolton, who is chairing it, and to Gareth Stace, the chief executive of UK Steel. I am optimistic that this will develop in a way that will please the hon. Lady.

--- Later in debate ---

[Tom Pursglove (Corby) (Con)]

From this side of the House, I echo the calls for a steel sector deal. Would my hon. Friend like to visit the Corby steelworks to see for himself the difference that that would make?

[Richard Harrington]

I would be delighted to make that visit.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

The chief executive of Jaguar Land Rover has said that a bad or no deal Brexit would cost the company more than £1 billion a year and threaten its future investment in the UK. Can the Minister explain how that can be avoided if the UK is outside the customs union?

Economic Growth: East of England

Lord Harrington of Watford Excerpts

Wednesday 10th October 2018 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate the hon. Member for Waveney (Peter Aldous) on securing a debate on the important subject of our industrial strategy and economic growth in the east of England. As a Member of Parliament for a north-eastern constituency, I am intimately familiar with the challenges of regional economic growth, although a premiership football club can make a significant difference.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

Enjoy it while you can!

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

It is a great pleasure to serve under your chairmanship, Mr Davies. Did you arrange the cabaret in the background?

[Geraint Davies (in the Chair)]

Especially for you.

[Richard Harrington]

I could not quite hear what they were saying, and it is probably better that I could not.

I congratulate my hon. Friend the Member for Waveney (Peter Aldous) not only on calling today’s debate but on his contributions to many other debates I have taken part in. He has always contributed in a non-partisan and a very statesmanlike way, and today was absolutely no exception. I welcome the east of England APPG submission, which we have read in my Department. I hope that some of my points respond to its recommendations.

I have a bit of a strange relationship with the east of England, simply because my constituency, as mentioned by my hon. Friend, is in the east of England, but most people who live in it do not think they are in the east of England, simply because it is such a large area, as was mentioned by several hon. Members. It varies from what some people think is outer London—it is not quite, but there is a more urban type of London demographic—to areas that are geographically quite remote. My right hon. Friend the Member for Witham (Priti Patel) mentioned—eloquently, as ever—that Essex is a huge county in its own right: it varies from outer London urban to quite remote country areas. It is difficult for any policy to take into consideration such a large area, and there is no simple solution. I accept the point about transport and more modern infrastructures being critical to everything, and I will come to that. It is easy for the European Union and national Government to talk of regions—as we talk about metropolitan areas—as being fairly homogenous.

I want to reiterate the Government’s commitment to promoting growth in the east of England. Any Minister would say that, and I would certainly say that to my constituents in the east of England. But the facts speak for themselves. The region is growing fast. It has seen continued growth in jobs and is one of only three regions that is a net contributor to the UK. Those are exactly the sorts of strengths the country needs to build on in securing a prosperous economic future for the UK as a whole.

As my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter) said, the region has not always pushed its case well, probably because of its large area and the different organisations in it. The all-party group’s report clearly reverses that, but as my hon. Friend the Member for Waveney said, it is the beginning of a process, not a one-off report—the Government certainly do not treat it as such.

Hon. Members highlighted many of the strengths of the east of England. I will not repeat the comprehensive list, but there are world-famous brands in Cambridge, which the hon. Member for Cambridge (Daniel Zeichner) mentioned, as there are in Milton Keynes, Hertfordshire, the coastal region and so on. However, I agree with him that the future is not guaranteed, which is why we have an industrial strategy. The shadow Minister was really quite scathing about that strategy—I hope I have time to come on to that. Governments have industrial strategies and policies because nothing in the economy is guaranteed. She mentioned the effects of our leaving the European Union. None of us knows what they will be, but whatever happens while we are in the European Union or out of it, nothing is guaranteed. It is important that the Government realise the importance of the east of England to the economy.

The shadow Minister will disagree, but since 2010 the Government have made good progress on supporting businesses and people in the east of England. Unemployment has halved, the number of small businesses has increased by more than 100,000 and, although good points were made about apprenticeships, 350,000 people have started them in the area.

The hon. Member for Cambridge mentioned the CPIER report. I welcome that and look forward to seeing how it is reflected in the local industrial strategy. He also mentioned land value capture. The Treasury and I look forward to receiving further developed proposals on land value capture in Cambridgeshire and Peterborough from the Mayor in due course. We have yet to see the full effect of Mayors, but I am positive about them and pleased that we have them.

The east of England is at the forefront of industrial strategy. We have local enterprise partnerships and, as I said, mayoral combined authorities developing and implementing industrial strategies. We are at the beginning of that road, but the east of England is in good shape. The Cambridgeshire and Peterborough combined authority and the South East Midlands LEP have been identified as trailblazer areas as part of the Oxford to Cambridge arc. Those pilot areas have made good progress and are on track to publish their strategies in March next year, with the rest of the region publishing theirs in 2020.

I reject much of what the shadow Minister said—not because she has a premier league football team in her constituency. I have made rather unpleasant comments about that, which I would like to withdraw, and I apologise for any offence caused. I am sure Newcastle United will remain in the premier league at least for this season, if not beyond. If that does not happen, at least she can blame their relegation on our leaving the European Union, since she seems to blame that for everything else.

[Chi Onwurah]

I thank the Minister for the initial generosity of his remarks about Newcastle United. Should they leave the premier league, we will be clear that the fault lies not with Brexit but with the club’s ownership. We hope his Government do something to address that.

[Richard Harrington]

I think the hon. Lady just called for the nationalisation of Newcastle United football club. Another few billion for the national debt—it really doesn’t matter, does it? We have many billions more.

[Geraint Davies (in the Chair)]

Order. Minister, we need to focus on the east of England, not the ownership of Newcastle United.

[Richard Harrington]

Governments have learned the importance of giving local areas control of local growth. I have seen for myself that we have to be careful about that. I studied economics A-level and, being from Leeds, we went to Newcastle to visit the National Economic Development Council there. Those bodies, which were known as “Neddys”, showed that localisation in itself is not enough. That was not a very effective system, but at least it was an attempt to regionalise. We have developed significantly beyond that as a society, which means we do not just send civil servants from London to work in Newcastle and say that is regional.

I hope we will see the benefit of devolution, with LEPs, Mayors and everything else. [Interruption.] I am cantering because I have only five minutes—I cannot really take any more questions about that. The Cambridge and Peterborough devolution deal builds on the significant commitments made to the east through previous city deals. I am very optimistic about the greater Cambridge city deal. It is delivering, and I really think we will see a lot more from it.

My hon. Friend the Member for Central Suffolk and North Ipswich made many extremely helpful points. The Government are committed to dealing with local skills shortages, such as those in agriculture, through the establishment of skills advisory panels, which are being rolled out to all parts of eastern England and will help to ensure that training matches the needs of local businesses. That cannot be ignored, and I believe our policy will help to achieve it.

The east of England benefits from more than £700 million of local growth funding through growth deals, and the region’s business-led local enterprise partnerships determine how that funding is spent. I have seen different kinds of LEPs, but the range of products being delivered in this case—the aviation academy in Norwich, the STEM innovation campus at Stansted airport and the Watford health campus scheme in my constituency, for example—will lead to a more skilled workforce and are very important for the east.

Infrastructure was mentioned by many speakers, in particular my right hon. Friend the Member for Witham and my hon. Friend the Member for Central Suffolk and North Ipswich, who stressed the importance of the A12. That is why, in addition to the devolution city deals I mentioned, we have invested £1.5 billion to upgrade the A14 between Cambridge and Huntingdon, which is an important route, and £151 million in new river crossings. Those are just examples. The transforming cities fund will really help Cambridge and Peterborough, which have already received £74 million. I could go on, but time does not allow.

The Government are committed to working with local partners. Many Members mentioned transport, which is absolutely important. I intend to send a summary of the points they made about particular roads to the Department for Transport. I know Members have done that, but I feel it is my job—I am not in that Department, but I represent the Government—to ensure that those points hit home.

My hon. Friend the Member for Clacton (Giles Watling) spoke so well about no community being left behind. He feels that his community and others, particularly in coastal areas, have been neglected by the system. He stressed the importance of infrastructure in such areas. I will not forget the points he made about his experience on Tendring Council, and I am happy to chat with him separately about that.

We have had a wide-ranging debate in which we did not have time to consider some of the necessary detail. However, the east of England all-party group has set out a model for how such groups can focus their lobbying of the Government on specific points. I am happy to meet formally with the all-party group or with individual Members. I do not mean only those on the Conservative Benches, as I hope the hon. Member for Cambridge knows. These are important points, and I would like to see the successful implementation of many of the policies mentioned in the APPG’s report.

Oil and Gas Industry

Lord Harrington of Watford Excerpts

Tuesday 9th October 2018 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

It is a great pleasure to serve under your chairmanship, Mr Hollobone. Indeed, I congratulate you on the discipline that you have brought to these proceedings, although curtailing the shadow Minister, the hon. Member for Southampton, Test (Dr Whitehead), to 10 minutes is a clear infringement of his human rights and of the normal way he behaves. In fact, some would say that it is a crime against humanity that his erudition, which is never known to be brief, was curtailed. I look forward to hearing him, as I did today, on many other occasions.

I genuinely congratulate the hon. Member for Falkirk (John Mc Nally) on not just securing the debate, but the thoughtful way in which he made his contribution. That sums up today’s debate. There is general consensus, and I hope hon. Members do not think I am saying this out of complacency, but the fact is that, as the hon. Member for Aberdeen North (Kirsty Blackman) said, most things to do with oil and gas are done on the basis of consensus. I wish there was the same attitude towards other debates in which I have the pleasure of speaking.

When I became Energy Minister, one of my first visits, in August of last year, was to Aberdeen—several hon. Members were with me that day—where I met industry leaders and visited Robert Gordon University to see the dynamic advanced response training simulator. That is relevant today because of the comments from the hon. Member for Falkirk about Piper Alpha. I saw a lot of the virtual reality equipment there, and I felt that I was actually on a rig. Everything was about health and safety and preventing the kind of incidents that happened at Piper Alpha. It is a tribute to the area that academia, industry and Government work together. I was most impressed by what I saw.

I understand the hon. Gentleman’s constituency interest because of the Grangemouth industrial site, which I visited as an A-level economics student in 1975—many hon. Members here were not born then, and some of their parents were probably only just born. However, I do remember the industrial site; I remember the scale of it. I think of it when I hear figures such as 8% of Scotland’s manufacturing base and 4% of GDP; I will never forget that visit, so I do understand the issue, and so do the Government.

In a very thoughtful speech, the shadow Minister expressed how important oil and gas are for the UK economy. I am not paid to promote the shadow Minister; I just cannot help but compliment him at various times. He talked about the mutual vision for the future. In fact, I kept looking up at him and seeing him reading from a document with blue print, which I thought was a Conservative party document, as the colour appeared to be the same, but which I then realised was, of course, “Vision 2035”, the authors of which at least had a good idea of which colour it should be in. But it does show no complacency; the serious point is that it does show a vision for the future, from what many people, out of ignorance, believe is a clapped-out former industry—they think that because they remember the boom days. One has only to visit it to realise that that is far from the case.

The upstream industry alone supports more than 250,000 jobs. Then there is the supply chain, supported by the sector, in key clusters all over the country. The hon. Member for Strangford (Jim Shannon), who has been at every single Westminster Hall debate I have ever spoken in, contributed extremely well. He mentioned the importance for Northern Ireland of the supply chain. I am very pleased to say that it is a United Kingdom supply chain and is not restricted to the specific area that many hon. Members have spoken about today.

The hon. Member for Aberdeen North mentioned Brexit, which came up in a few of the contributions. I do not take it lightly, I assure you, Mr Hollobone—none of us does. Many of the good things that have happened in the past couple of years have happened in a time when things have been written off because of Brexit, but I want to say to the hon. Lady and others that the Government fully understand the need for frictionless trade, on which the oil and gas industry has long depended, whether in the movement of goods, services or people. I assure her and other interested Members that my Department has made that matter very clear to other parts of Government—it is our job to do that, and we have. We are fully aware that the sector has paid more than £330 billion in revenue to the Treasury, which is phenomenal. I know of no other single sector that has been as beneficial to the Government over the past half-century.

The end-use facility mentioned by my hon. Friend the Member for Waveney (Peter Aldous) and by the hon. Member for Falkirk relates to customs procedures. I assure Members that Her Majesty’s Revenue and Customs continues to discuss with the sector the possibility of future mitigations being available, and which ones. The issue is complex, and I cannot claim to understand the full detail.

Since 2014, it is fair to say that the industry has had a torrid time as a result of the collapse in the price of oil. From that point of view, I am pleased that the price has gone up, but what I realised on my visit to Aberdeen was that, despite the decimation of the industry and its contraction—a statement of fact about the number of employees and so on, as was explained to me—good things resulted as well, such as some new technologies.

I remain optimistic for the future. I feel that the tripartite approach between the OGA, industry and Government, which hon. Members mentioned, is particularly important. I am pleased that, since its establishment, an extra 3.7 billion barrels have been forecast, and production has risen by 16% since 2014 figures, with a reduction in the production costs. The issue was forced by what happened to the price, but those cost reductions will remain and be improved on.

Optimism is returning to the North sea. My hon. Friend the Member for Gordon (Colin Clark) mentioned the amount of mergers and acquisition activity over the past couple of years—about $8 billion-worth last year—with some significant investment involving new players to the basin. Divestment by some of the supermajors does not mean that they are losing interest; it is part of the natural order of a mature basin, with newer, smaller companies coming in. Shell is investing in new frontier areas, and BP’s development is moving well. There is huge potential.

To determine the industry’s potential, we obviously need responsibly regulated exploration, and the Government support that. There are a lot of challenges, and we understand that. The Government all realise that exploring and drilling for the upper reaches of the remaining resources is more difficult than doing so for the original resources—that is a statement of fact—and the measures that we have put in place since 2014 will contribute significantly towards that.

The focus of the debate is on the future. My hon. Friend the Member for Ayr, Carrick and Cumnock (Bill Grant) asked me to comment on the IPCC report, and our clean growth strategy is clear. We are focused on meeting our Paris agreement climate change targets, and we have asked the Committee on Climate Change for advice on our targets in the light of the new evidence.

Whatever happens, oil and gas will be part of the energy mix for decades to come. We know that we have to reduce demand to meet our climate targets, but this industry has a lot going for it. Gas can play an important role, and so can oil. My Department’s main interest will be to continue the security of the energy supply, which means that we have not seen the end of hydrocarbons.

I am running out of time, and I will do my best to talk briefly about the sector deals mentioned by several hon. Members. One of my responsibilities is the implementation of sector deals. We have had a lot of discussion with the industry, and I am confident that these will proceed. As my hon. Friend the Member for Banff and Buchan (David Duguid) pointed out, this is an ambitious sector deal to support the industry’s “Vision 2035”. We have not yet reached the final stage of the process, we will do so quite soon. It is a question of assessing the value for money of the amount of contribution expected in the deal from Government, which takes more time than people think.

This is a complex industry with a great future. My hon. Friend the Member for Banff and Buchan said that it is an industry with a lot going on, and we know that the Government, the industry and the Members who have spoken today will be an important part of its future.

[Dr Whitehead]

On a point of order, Mr Hollobone. I may have misled the Chamber inadvertently by quoting a statistic erroneously. On the estimates for natural gas usage in 2035, the figure should be 59 megatonnes of oil equivalent and not 29, as I believe I said in my speech.

Business Policy

Lord Harrington of Watford Excerpts

Monday 23rd July 2018 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I will this morning lay before Parliament a draft Registration of Overseas Entities Bill which establishes a register of the beneficial owners of overseas entities that own UK property. This follows the commitment made at the anti-corruption summit in 2016 to establish such a register, in order to combat money laundering and achieve greater transparency in the UK property market.

Overseas entities will be required to register their beneficial ownership information with Companies House before obtaining legal title to UK property via the land registries. Overseas entities that own UK property when the requirements come into force, as well as any overseas entities that subsequently acquire UK property, will be required to register (and regularly update) their beneficial ownership information before they can undertake certain transactions with that property, such as selling or leasing the land, or creating a legal charge over the land, such as a mortgage.

This will deliver a world-first register, and builds upon the UK Government’s global leadership in tackling corruption, ensuring that the UK continues to be a great place to do business.

The draft Bill will be published with accompanying explanatory notes, an overview document and impact assessment and research report on the potential impacts. The draft Bill will undergo pre-legislative scrutiny to ensure that it is robust and workable. The Government intend to introduce the legislation early in the second Session of this Parliament.

[HCWS897]

Oral Answers to Questions

Lord Harrington of Watford Excerpts

Tuesday 17th July 2018 Commons Chamber

[John Spellar (Warley) (Lab)]

5. What recent discussions he has had with trade union representatives on the future of the British motor sector.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

On 25 June, I met Unite the union to discuss its views on how Government can best support the UK automotive sector. I met Tony Burke and representatives from the Jaguar Land Rover, Toyota and GKN unions. The Secretary of State and I also speak to the unions regularly through their membership of the Automotive Council.

[John Spellar]

I thank the Minister for having that meeting, because under Conservative, Labour and even Lib Dem Ministers, Britain rebuilt its motor industry by working closely with industry and the unions. Unfortunately, more recently, ill-considered lurches in policy by the Department for Transport, which are less like the prosperity agenda and the industrial strategy and more like Soviet 10-year plans, are creating deep uncertainty, especially for the diesel sector, where Britain is a world leader. What will the Minister now be doing with unions and companies to get our motor industry policy, across Government, back on track?

[Richard Harrington]

The Government’s “Road to Zero” strategy, which was published last week, made it clear that there is a continuing role for clean diesel vehicles as we reduce carbon dioxide emissions from UK road transport. It has been generally welcomed by the automotive industry.

[Sir Patrick McLoughlin (Derbyshire Dales) (Con)]

We have seen tremendous investment in the motor industry over the years, not least in Toyota in Derbyshire. What are the Government doing to encourage more investment?

[Richard Harrington]

My right hon. Friend will be very aware of the number of meetings we have with the automotive industry and of how closely we are working with it on the sector deal. The Automotive Council met only in the past couple of weeks, and that was one of the top things on the agenda for discussion.

[Mr Jim Cunningham (Coventry South) (Lab)]

Some 53% of our exports rely on Europe. What are you doing to protect that market for us?

[Mr Speaker]

I am doing absolutely nothing on the matter.

[Richard Harrington]

I hope the hon. Gentleman has read the Chequers agreement and the White Paper. I will be very happy to forward him a copy. It explains how the views and interests of the motor industry are central to how the sector works throughout all countries in the European Union, including us. We will continue in a friction-free way that is very much to the advantage of the automotive industry.

[Jack Dromey (Birmingham, Erdington) (Lab)]

The success of Jaguar Land Rover and the Jaguar plant in my constituency has transformed the lives of thousands in an area of high unemployment. Now JLR is facing the twin challenge of the transition from diesel on the one hand and the threat of Brexit on the other. Does the Minister agree that wide-eyed Brexiteers appear to believe that we can crash out of the European Union with no consequences for jobs, that they are wrong and they are letting down British workers, British industry and Britain?

[Richard Harrington]

I hope the hon. Gentleman does not think my eyes are too wide. Despite your efforts last week, Mr Speaker, there seems to be a shortage of Members on both sides of the Chamber who have actually read the White Paper. I would be very happy to give one to him.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Moving to electric vehicles should be transformative for our country and our £77 billion car sector, creating new markets and jobs in manufacturing, services, the supply chain and battery recycling. What are the Government doing? Their Faraday challenge does not cover manufacturing or skills, they have ditched renewable energy investment, delayed the £400 million investment in charging infrastructure and allowed the takeover of GKN’s world-leading battery technology, and yesterday they voted for a customs plan that will sever automotive supply chains, putting more than 800,000 jobs at risk. Is it not the Government’s role to help create high-skilled, high-productivity jobs, not destroy them?

[Richard Harrington]

I totally agree with the hon. Lady: it is the Government’s role to do exactly that. That is why we have the Faraday battery challenge, which covers skills, and why the Government are putting so much effort into battery technology and clean technology for this country. I am very proud of that. I have seen skills in the automotive industry when I have visited car factories and the schools around them. The number of apprenticeships shows that the Government are totally committed to skills. We have a very bright future with batteries.

[Mike Wood (Dudley South) (Con)]

6. What steps he is taking to ensure that low-paid workers are remunerated appropriately.

--- Later in debate ---

[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

8. What steps the Government is taking to ensure that Scotland benefits from the modern industrial strategy.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I am pleased to assure my hon. Friend that our modern industrial strategy continues to deliver strongly for Scotland. The progress in negotiations for a growth deal with Ayrshire demonstrates our commitment to regional growth. Investment in Scotland through the industrial strategy challenge fund includes last month’s £13 million for a medicines manufacturing innovation centre in Renfrewshire.

[Bill Grant]

I thank the Minister for that reply. In November 2017, the Secretary of State announced a review into how Scotland’s two Governments can collaborate better on business support. Will he update the House on the progress of that review, and will he reassure me that he will strive to ensure that the industrial strategy and the Scottish Government’s business support programmes complement, rather than compete, with each other?

[Richard Harrington]

I am very pleased to reassure my hon. Friend, who works so hard on this subject, that we continue to work closely with the Scottish Government on many industrial strategy priorities, including our support for innovation and business productivity. Regarding the review, work is under way across government to determine its scope. Clearly, our partnership with the Scottish Government will be essential as that progresses.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Scrapped subsidies for renewables, failure to support the oil and gas sector in its time of need, betrayal over the pledge to invest £1 billion in new carbon capture in Peterhead—now, the Government are seemingly poised to splash £15 billion more of taxpayers’ cash on outdated nuclear technology at Hitachi’s Wylfa plant. When will we get an industrial strategy that actually works for Scotland?

[Richard Harrington]

That is not the picture of the oil and gas industry that I know following a visit to Aberdeen, where I saw more investment, more Government support and more support in the area for this Government’s industrial strategy. I am a great admirer of the hon. Gentleman normally, but I think he must have read the wrong script for this question.

[Craig Tracey (North Warwickshire) (Con)]

9. What steps he is taking to support growth in the small business sector.

--- Later in debate ---

[Kevin Foster (Torbay) (Con)]

20. What steps he is taking to support growth in the small business sector.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

Corporation tax rates will be cut from 19% to 17% in 2020. We have doubled the annual allowance for people investing in knowledge-intensive companies through the enterprise investment scheme, and we are investing over £26 million through Be the Business. The Government’s British Business Bank is supporting over 70,000 smaller businesses to access £4.6 billion of finance.

[Craig Tracey]

Thirty-three jobs have been created and supported in my constituency through the small business loans platform, Funding Circle. What more can we do to encourage small businesses, particularly those that are female-owned, to look at wider ranges of finance options to help them to grow?

[Richard Harrington]

We want to ensure that all businesses get to know how to use the finance they need, including our 1.2 million women-owned businesses. Alongside the online finance finder and the business bank’s finance guide, the business bank is working with partners to understand the representation of women in venture capital firms.

[Scott Mann]

Some small businesses in Cornwall have seen increases in their business rates. This is against a platform of increased online sales. What discussions is the Department having with the Treasury to ensure fairness in our taxation system?

[Richard Harrington]

I thank my hon. Friend for that question. Some people would argue that Ministers engage with the Treasury too often on many matters, but we engage with them regularly on this matter. The Chancellor has been clear that we need to find a better way to tax the digital economy. We are making progress on that before considering the implications for the wider tax system, including business rates.

[Kevin Foster]

Small businesses in Torbay could benefit significantly from a coastal enterprise zone, as part of a town deal for our area. What view does the Minister take of this type of arrangement?

[Richard Harrington]

I thank my hon. Friend for all the work he has done for Torbay businesses. I understand that the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Rossendale and Darwen (Jake Berry), who has responsibility for local growth, recently had a positive meeting with him and representatives from Torbay to discuss their proposals for local economic growth. I encourage Torbay to continue to work with local partners as it develops its plans, including the Heart of the South West local enterprise partnership, which will play a central role in the local industrial strategy for the area.

[Ruth George (High Peak) (Lab)]

Evidence to the Work and Pensions Committee on the operation of the minimum income floor for small businesses under universal credit stated that the percentage of small businesses surviving the first 15 months would fall from 70% to less than 20%. What representations has the Department had with the Department for Work and Pensions to support the growth of enterprise and small businesses?

[Richard Harrington]

We have many and regular meetings at all levels with the Department for Work and Pensions on that subject, but the hon. Lady is right: starting small businesses is very difficult and it always has been. Some of them survive and some do not, and some go on to be extremely successful larger businesses. She is right to be concerned about the amount of support that government, local and national, give them, and I can assure her that it is at the top of our agenda.

[Rachael Maskell (York Central) (Lab/Co-op)]

There may be a lot of discussion between the Department for Business, Energy and Industrial Strategy and the Treasury, but the reality is that there is no action on business rates. Our retail sector is closing down and 200,000 businesses have been taken to the magistrates court for non-payment, so when will we have a review of business rates and when will we see change?

[Richard Harrington]

I think that the hon. Lady is misinformed. There has been significant help for small businesses on business rates in previous Budgets and this is being looked at all the time.

[Ronnie Cowan (Inverclyde) (SNP)]

The Scottish Government Budget provided £96 million to deliver the most attractive business rates package in the UK. How long do firms and entrepreneurs have to wait till the UK Government use their industrial strategy, put their money where their mouth is and follow Scotland’s lead?

[Richard Harrington]

The UK Government really do not need to take very many lessons from Scotland on how to help businesses with business rates and every other form of business support. Actually, the working relationship between the two Governments is pretty good and we aim to provide a good business environment for all businesses on both sides of the border.

[Adam Afriyie (Windsor) (Con)]

10. How much funding his Department has provided to the UK science base in the last 12 months.

--- Later in debate ---

[Peter Aldous (Waveney) (Con)]

T2. With the construction sector deal setting out several options to tackle poor payment practices, can the Secretary of State assure me that retention deposit schemes, as proposed in my private Member’s Bill, which has significant industry and cross-party support, will be given full consideration and, hopefully, Government backing?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I have met my hon. Friend to discuss his Bill, and we fully understand that the practice of retention has caused problems for the construction industry supply chain. We are fully committed to tackling the issue, but any action we take needs to be robust, proportionate and evidence-based. We have listened and consulted, and we will shortly be publishing the response to a public consultation considering several options including a retention deposit scheme.

[Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)]

UK steelmakers are paying up to 50% more for their electricity than their European counterparts, which is reducing their competitiveness on the global stage. Ofgem’s targeted charging review is set to exacerbate the situation. What representation has the Minister made to Ofgem regarding its review and the effect of that review on both the steel sector and energy-intensive industries in the UK?

[Richard Harrington]

We meet Ofgem very regularly to discuss this and other matters, and we are very aware of the situation. As the hon. Lady knows, I have met many companies in the steel industry and discussed this, and it is very much part of our discussions with Ofgem and others.

[Sir Edward Leigh Gainsborough) (Con)]

T3. Last night the House of Commons voted to enshrine it in law that if under a facilitated customs arrangement we collect tariffs on behalf of the EU, that should be done on a reciprocal basis. Is it really practical to expect a Croatian border guard to start levying tariffs on our behalf on bottles of wine? Is there the remotest chance that the EU will ever agree to this reciprocal arrangement? Is it not time to return to a free trade deal?

--- Later in debate ---

[Mr Steve Reed (Croydon North) (Lab/Co-op)]

T7. A survey of London businesses by London Councils and the London chamber of commerce has found that a third of apprenticeship levy payers do not expect to use any of their funds over the next 12 months. Does the Minister agree with the all-party parliamentary group on London that unspent funds should be devolved and used to support job skills in London rather than being returned to the Treasury?

[Richard Harrington]

I can assure the hon. Gentleman that we are having regular meetings with all the business representative bodies and the Department for Education to ensure that levy funds are spent properly, for the purpose for which they are meant and in local areas by the companies that pay the levy.

[Martin Vickers (Cleethorpes) (Con)]

The Secretary of State referred earlier to the visit of his colleague, the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Rossendale and Darwen (Jake Berry), to north-east Lincolnshire to sign the Greater Grimsby town deal, which is very welcome and I thank him for his support in achieving that. One of the things that his colleague will have seen is the great opportunity to develop trade through the Humber ports. The Humber local enterprise partnership, the local authority, the Hull and Humber chamber of commerce and local businesses have been working towards the possibility of free port status, post Brexit. Can the Minister assure them that nothing that comes out of the negotiations will prevent that from happening?

--- Later in debate ---

[Martin Whitfield (East Lothian) (Lab)]

Will the Minister confirm support for the Civil Nuclear Police Federation in its meeting this summer with his Cabinet colleagues over the proposals to reduce retirement and pension ages for armed officers from 67 to 68 down to 60 to match those of the police?

[Richard Harrington]

I can confirm that I have been in discussions with the CNPF. I have met the chief constable and the chairman, and I visited the civil nuclear police on site at Sellafield. I am well aware of the issue, and I am in discussions with colleagues at the Treasury and elsewhere.

[Several hon. Members rose—]

Whole Company Pay Policy

Lord Harrington of Watford Excerpts

Monday 16th July 2018 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I congratulate the hon. Member for Mitcham and Morden (Siobhain McDonagh) on securing this evening’s debate. This is an important subject, and I commend her passion and her extensive campaigning on behalf of lower-paid workers in our economy. However, I know that she wants more than to be commended by me; she wants answers to her questions. I shall do my best to provide them. I recognise, and sympathise with, her view that executive pay in this country too often seems to exist in a bubble that is disconnected from the pay and experiences of ordinary working people.

I accept the hon. Lady’s numbers. We saw a staggering quadrupling in the average pay of FTSE 100 chief executive officers from the late 1990s to 2011 from just under £1 million a year to more than £4 million. I think that this has been imported from America, where the differences are even larger. Executive pay levels have largely stabilised since then, but shareholders and the wider society have increasingly questioned how such dramatic levels of reward can be justified, both in terms of individual performance and in relation to a company’s pay policy as a whole. The Government share that concern. We are not against CEOs being well paid for doing what is certainly a hugely demanding an important job. We accept that they have a lot of responsibility. For example, if part-time workers are included, Sainsbury’s has 180,000 people, and any one person who is responsible for 180,000 people certainly deserves rewarding well. I do not think that anyone would dispute that.

[Jim Shannon]

The point that the hon. Lady made with passion is that workers who have given effort, commitment and loyalty to a firm should be rewarded. The whole workforce should be rewarded, not just one person.

[Richard Harrington]

I absolutely agree, but pay is earned for several reasons. Hard work is definitely one of them. I am not comparing ourselves, but we are all here at 11.40 pm, so no one could say that we are not working hard. The dispute would come from the second reason for pay, which is how well someone is working and the their responsibilities. I would not ask the hon. Gentleman to intervene to say how well he thinks I am doing, but I certainly know that he and the hon. Member for Mitcham and Morden do a good job. I am not making light of the situation; I mean that reward is partly based on how well someone is doing and partly on how hard they work, but part of it is about responsibility. We would all agree that chief executives have a lot of responsibility, and they should not have job security because they are putting themselves on the line for workers, shareholders, banks or whomever it might be. This is a question of extent and of how much reward is performance related and how much of it is a basic salary. I hope that the hon. Member for Mitcham and Morden and the hon. Member for Strangford (Jim Shannon) do not think that I am trying to make light of this, because there is a significant issue here.

We may disagree on this, but I think the answer lies with transparency and accountability in how executive pay is set and in how it fits with wider employee pay and incentives. The Government have introduced major reforms on executive pay, and the first package in 2013 and the second package approved by Parliament just last week are important. The 2013 reforms compelled quoted companies to disclose each year the total pay and benefits of their CEOs and directors and to explain how that relates to company and individual performance. For the first time—this is important—we gave shareholders a legally binding vote on a company’s executive pay policy, with which all payments to directors must comply. Taken together, the two reforms have forced companies to be much more rigorous and transparent in their approach to executive pay.

However, more needed to be done, in particular to increase transparency and accountability in how pay at the top relates to pay and reward across the rest of the company. It is vital that companies demonstrate cohesion and a comprehensible line of sight between executive pay and the pay of other employees. They are all part of the company, and part of its success, and a confident organisation should be willing and able to explain how its approach to pay is consistent across all its employees. That is why the Government are now implementing major new statutory and code-based reform measures on executive pay as part of a wider package of corporate governance reform.

The headline reform measure—this is directly relevant to the hon. Lady’s speech—is to require all quoted companies to disclose and explain the ratio of their CEO’s pay to both the median average and the quartile pay of their UK employees. The pay ratio statement must include an explanation of

“whether, and if so why, the company believes the median pay ratio for the relevant financial year is consistent with the pay, reward and progression policies for the company’s UK employees taken as a whole.”

That will allow shareholders, employees and other interested parties to see how pay in the boardroom relates to wider employee pay throughout the company and, importantly, whether and how the directors of the company believe the differentials are justified. This is not just about employees, important though they are, because shareholders have strongly backed the introduction of pay ratio reporting and will be watching closely both the figures and the explanations, which they have made clear must be meaningful and relevant.

UK shareholders are increasingly vocal and assertive in holding companies to account on executive pay and other issues, which the Government support. The Government requested the Investment Association to establish the world’s first public register of shareholder dissent, so that there is a publicly monitored record of companies that receive more than 20% votes against executive pay packages. Halfway through the first year, there have been 140 significant shareholder rebellions on pay and other matters—more than the total for the whole of last year.

The Government have asked the Financial Reporting Council to consult on a number of new executive pay provisions in the UK corporate governance code, including a requirement for remuneration committees to explain what engagement with the wider workforce has taken place on how executive pay aligns with wider company policy. I am pleased to say that this new measure forms part of the revised corporate governance code published by the FRC earlier today—this is very topical—as part of a wider package of corporate governance reforms that require companies to put in place one or more of either a director appointed from the workforce, a formal workforce advisory panel or a designated non-executive director. It is complicated, but we are making developments. Companies will have to report on how they have had regard to the interests of employees. The statutory instrument was approved by Parliament last week and requires large companies to report each year on how they have had regard to the interests of their employees and on how it has influenced the decision making of directors.

All these measures will be in place from the start of January 2019, and I take the opportunity to thank everyone in this House, particularly the Business, Energy and Industrial Strategy Committee and the all-party parliamentary group on corporate governance, for their constructive contributions to this agenda over the past two years.

Before I finish, I will address some of the questions raised by the hon. Member for Mitcham and Morden.

[Siobhain McDonagh]

Will the Minister address the issue of pay between assignment contracts?

[Richard Harrington]

I will do my best but, if the hon. Lady is not satisfied with my answer because of the time available, I would be very happy to meet her to discuss this complex subject.

The question of agency staff being paid less despite doing the same work are known as assignment contracts, as I am sure you are aware, Mr Deputy Speaker—you are omnipotent and know everything, or most things, I have ever asked you about. The hon. Lady referred to that as subcontracting some of the lower-paid workers. The Government are looking into that as part of our response to the Taylor review. There is a specific consultation on agency workers in response to that. I know that might not sound like the comprehensive answer the hon. Lady wants, but it is work in progress and I suggest she wait a little before having the meeting, when I will be happy to go through it with her.

Mr Simon Roberts, the retail and operations director of Sainsbury’s, wrote a very comprehensive letter to the Government proudly saying that Sainsbury’s has met the hon. Lady on several occasions. Mr Roberts clearly has not satisfied her, but he has written a four-page letter to us about it. At least Sainsbury’s has had the guts to meet the hon. Lady, and I am sorry that she is not satisfied.

Sainsbury’s has 185,000 employees, and the hon. Lady’s main point is that it is unfair of Sainsbury’s to continue paying its CEO a bonus while cutting bonuses and other variable pay for the rest of its 185,000 staff. The company says it has taken steps to improve its pay offer and specifically to put in place measures to support the staff most affected by the proposed changes, which of course I welcome. I wonder whether the hon. Lady is aware of that.

[Siobhain McDonagh]

I am completely unaware of what those measures are, because I assure the Minister that at the annual general meeting last week there was a bullish contribution from the chair of the board saying it had done nothing wrong and that it is equalising pay. My concern is that 9,000 of Sainsbury’s most long-standing members of staff will be getting a pay cut from 2020.

[Richard Harrington]

I will send Mr Simon Roberts a copy of the Hansard record of this debate tomorrow and say that the hon. Lady is not satisfied with that answer. I will ask what the details of the improved pay offer are and what measures have been put in place to support the staff most affected by the proposed changes. On the face of it, I welcome what has been done, but it may be that this is not exactly as Sainsbury’s says it is. The company says it is committed to increasing its hourly rate of pay from £8 to £9.20 an hour from September and it has promised top-up payments from 18 months to support what it says are the “small minority” of Sainsbury’s employees whose loss of certain benefits will have seen them worse-off overall under the pay deal.

In conclusion, I thank the hon. Lady again for giving the House the opportunity to debate these important issues. It is absolutely right that companies approach pay and reward holistically and that executive pay aligns with wider pay and reward. I think the new reforms that Parliament has approved will help in that regard, while keeping the UK a world leader in corporate governance.

Question put and agreed to.

Nuclear Sector Deal

Lord Harrington of Watford Excerpts

Wednesday 11th July 2018 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

It is a pleasure, as always, Mr Owen, to speak under your chairmanship. I would very much like to answer the shadow Minister’s points, but I am very short of time. I congratulate my hon. Friend the Member for Copeland (Trudy Harrison) on securing the debate. In fact, on a recent visit to Sellafield she knew so many people that I thought there should be a big sign in the street saying “There’s oodles of Troodles”—because she is omnipresent. She personifies the way the Government support the nuclear sector. I must disagree with the two Scottish National party speeches; there is a fundamental difference of opinion there. We believe that nuclear is an important part of the mix for this country. We do not agree that it is incompatible with building up renewables. Security of supply is the most important thing. One of our strengths is the balance that we have. I know that will continue. [Interruption.] I do not really have time to give way. I have to get on, or I cannot answer hon. Members’ questions. The Government are committed to those strengths. We must develop the technologies that will transform existing industries; that is part of our industrial strategy and the nuclear sector deal is an important part of that.

I must apologise to the hon. Member for Barrow and Furness (John Woodcock) for not being at his urgent question, but when I heard about it I was on a train from Chester to north Wales to help launch the nuclear sector deal. However, had he informed me the night before, it would of course have been my pleasure to be there. I will come on to his points in a moment.

The sector deal was launched in Trawsfynydd in north Wales, which is a fitting setting for it. It is a £200 million package with a focus on innovation, cost reduction and skills, to ensure we have the technology and expertise necessary to maintain the UK’s position as one of the world’s leaders in the nuclear sector. I congratulate Lord Hutton, the sector champion; we worked with him and with industry leads from the Nuclear Industry Council to develop the content of the deal. The basic points are, first, a 30% cost reduction in the cost of new build projects. As the shadow Minister said, it is essential for the future that the cost of nuclear comes down.

The cost of Hinkley Point was mentioned in the contributions from the Scottish National party; that was done in such a way that there is no risk to the taxpayer but huge benefits to this country. On a recent visit to Hinkley Point, I was very well hosted by the local MP, my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger), and I recommend that the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) takes him up on his invitation. It is an incredible site and so good for this country, with local contractors and British companies employing so many people.

The second point is to achieve savings of 20% in the cost of decommissioning compared with current estimates, and the third is hugely to increase the number of women. I was impressed by the number of women working on the site in Hinkley, particularly the apprentices.

I must rush. The hon. Member for Barrow and Furness asked me to answer a question about the transport link points and said, quite rightly, that my Department must work closely with the Department for Transport. I know that that is happening and that there is a joint committee, but, as a result of his point, I will attend the next meeting of the joint committee and personally report back to the hon. Gentleman—either by writing to him or by arranging to meet him on that subject.

NuGen Moorside, which the hon. Gentleman and my hon. Friend the Member for Carlisle (John Stevenson) mentioned, is a commercial matter between companies at the moment. The Government do not have a magic answer to that, but my hon. Friend asked me to state that we stand by to provide whatever assistance is needed, and we have shown in Wylfa, Anglesey, in which you may have an interest, Mr Owen—although I know you are interested in everything that goes on while you are in the Chair—that we will look at innovative methods of funding new nuclear developments. I understand that there are commercial negotiations going on in places such as Japan and South Korea, and we are monitoring the situation. Again, I will happily report to my hon. Friend and the hon. Member for Barrow and Furness what comes from it.

The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) brought up some interesting points, which I must say I was completely ignorant of, about the nuclear submarines in Devonport. I have not looked on Google Earth, because I thought that would be a bit rude under your chairmanship, Mr Owen, but I will do so straight afterwards. I know there is a joint review between the Ministry of Defence and ourselves on decommissioning, and there is a lot of work to be done, but I want to include the MOD more in everything we do. It is quite time enough, and the hon. Gentleman made a very good point, supported by some of my hon. Friends. Because the MOD is a member of the Nuclear Industry Council, it is time that that artificial distinction came to an end, and I will do my absolute best to bring that about.

My hon. Friend the Member for Carlisle and other speakers brought up points about the RAB system of funding, at which we are looking closely. There is a lot of work going on about that. Obviously, I cannot make an announcement on it because we have not yet reached that stage, but it is an innovative form of funding. It gives certainty; it has worked for the Thames tideway and is being looked at for other schemes, and I hope to report back on developments there.

The main point of the whole sector deal that I can see, which is one of the first things that I really got involved in when I took on this portfolio and which I am impressed by, is the contributions from industry and how many different companies are involved. It is not just the usual suspects, or two or three people; it is very comprehensive.

On decommissioning, I have been asked by several hon. Members, including my hon. Friend the Member for Copeland, about the role of the Nuclear Decommissioning Authority as time goes on and moving it from decommissioning to development. Its interest now is in decommissioning; it is the decommissioning authority, and we know that that is overwhelmingly its most significant purpose. However, on a visit to Sellafield, where I met and was impressed by their management, I was told that they already do about £100 million worth of export services. We are well respected throughout the world, and I think it will develop exactly in the way that my hon. Friend suggested, towards a development agency. Part of the sector deal is to transform decommissioning from where it is now, which certainly on the face of it is just a burden to the taxpayer, to an industry that employs a lot of people and supports a lot of products for this country and will be the foremost of its nature in the world. The set-up is now there to achieve that.

I will finish my comments now, Mr Owen, because you have asked me to leave time for my hon. Friend to make a few winding-up comments. I thank everybody; I am sorry I have not had time to go into more detail on some points, but I am always available to talk about them with any hon. Member here.

Construction Sector Deal

Lord Harrington of Watford Excerpts

Thursday 5th July 2018 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Richard Harrington)]

I note with respect, Mr Speaker, that you are wearing the same badge as I am, and I therefore hope you will join me in wishing the NHS a very happy birthday. That, of course, is also relevant to the construction sector deal, because the NHS is responsible for a large amount of construction.

With permission, Mr Speaker, I will make a statement in response to the Government’s publication of the sector deal for construction. Sector deals, in which industries are invited to come forward with plans for their future, embody the ethos of our collaborative approach. They show how industry and the Government, working in partnership, can boost the productivity and earning power of specific sectors. We have already struck ambitious deals with the artificial intelligence, life sciences, automotive and creative industries sectors, and the nuclear sector deal was announced last week. We look forward to building on that in the months ahead.

In keeping with the ethos to which I have referred, today’s deal represents a joint vision agreed by the Government and the construction sector which aims to transform the sector’s productivity through innovative technologies and a more highly skilled workforce.

Construction underpins our economy and society. Few sectors have such an impact on communities across the UK, or have the same potential to provide large numbers of high-skilled, well-paid jobs. The construction sector, encompassing contracting, product manufacturing and professional services, had a turnover of about £370 billion in 2016, and employs 3.1 million people. Given its size and importance, the sector has a vital role to play in achieving the vision set out in our industrial strategy: strengthening the foundations of our economy, achieving the grand challenges of putting the UK at the forefront of the artificial intelligence and data revolution, maximising the advantages from the global shift to clean growth, becoming a world leader in the future of mobility, and meeting the needs of an ageing society.

We are in the early days of what is one of the greatest construction programmes in our history, from delivering more affordable and safer homes in places where people want to live, to major infrastructure projects such as Crossrail and the third runway at Heathrow. This infrastructure pipeline represents more than £600 billion over the next decade, including at least £44 billion for housing. The pace of that change, and its size, demands a construction sector that is the best in the world, and today’s deal sets out to make that a reality.

First, the sector and the Government are making a joint £420 million investment to develop and commercialise digital design and offsite manufacturing technologies. We aim to reduce the cost of new buildings by a third, and to halve the time taken to deliver them. That will ensure that we get value for money from the Government’s national infrastructure and construction pipeline. The current projections are for about £600 billion of public and private investment in infrastructure over the next 10 years, as well as a doubling of expenditure on economic infrastructure in the decade to 2022-23. The investment will also support the Government’s aspiration to deliver 1.5 million new homes by 2022.

Secondly, we will ensure that the construction sector is able to attract, train and retain the workforce that it needs both now and in the future, as it meets the demographic challenge of a workforce in which nearly a third of workers are over 50. That includes working with the Construction Industry Training Board to ensure that there is a strategic focus on future skills needs, and to increase significantly the number of approved apprenticeship standards. The sector will also aspire to increase the number of apprenticeship starts to 25,000 a year by 2020, and will work with professional institutions and the higher and further education sectors to ensure that all those training for or working in the industry are able to develop and increase their skills.

Finally, to ensure that the construction sector is home to more sustainable, profitable businesses, the standard business model needs to change to one that is based on strong integrated supply chains and higher levels of collaboration. Key to that is a boost in the sector’s exporting capability, driven by our new investments in digital and manufacturing technologies to make the most of a market that is estimated to be worth £49 trillion between now and 2030. We will also ensure that construction firms have better access to the capital that the industry needs to invest and grow. That will include taking account of existing funding streams and the conclusions of the patient capital review, which aims to increase the availability of long-term finance to innovative firms.

History shows that the business community is best placed to identify what firms really need, and the Government will be there to support them. Sector deals rely on committed and visionary leadership. I therefore thank Andrew Wolstenholme, the sector deal champion, and the whole Construction Leadership Council, without whom this ambitious deal would not have been possible. After the statement I shall be visiting Battersea power station, where I will meet the leading members of the sector who have been so influential in bringing the deal to fruition.

The sector deal will drive economic growth, create well-paid, highly-skilled jobs in every part of the UK, and improve lives across the country. It represents a shared commitment to achieve those goals by establishing a strategic partnership between the Government and the sector, which we will seek to strengthen in the years ahead.

[Bill Esterson (Sefton Central) (Lab)]

I thank the Minister for early sight of the statement. It is welcome that there is a sector deal for construction, although the promised “a few weeks” from last November have become nine months.

Like last week’s nuclear deal statement, this appears to be a series of reannouncements of previous ministerial policies. The announcement about reducing emissions, although welcome, would be more credible if it were not so starkly at odds with other Government policies, such as last week’s cancellation of the Swansea Bay tidal lagoon. The steel, retail and rail industries are still awaiting responses to the proposals that they made last September. Perhaps the Minister will tell us when other sector deals will be agreed.

The collapse of Carillion of course caused at least some of the delay in today’s announcement, but that in turn was caused by the Government’s own lack of oversight, so what assurances will the Minister give to the sector that there will be no more Carillions, and that suppliers and workers can have confidence that Government will support them on Government-funded contracts? And what in this deal will address the concerns around late payment and retentions that the Carillion fiasco highlighted, with 30,000 suppliers owed £2 billion? What was changed during the review of this sector deal from what was announced last year? There appears to be nothing to tackle the problems endemic in public sector construction procurement.

The commitments in this sector deal on productivity and the speed of building are welcome, but they need to be matched by a significant increase in Government investment in infrastructure and house building projects. That is how we can properly support the construction industry. The TUC has shown that the £31 billion through the national productivity fund increases public investment to 2.9% of GDP, whereas the average spent on investment by leading industrial nations in the OECD is higher, at 3.5%. Labour is committed to a national transformation fund of £250 billion of capital investment over 10 years. Comparing those figures, we have to question whether the Government’s commitment to investment is meaningful. Similarly, the rhetoric about skills and technical education is welcome, but can the Minister give the sector an assurance that those skills will be developed to enable the radical transformation of construction that this country desperately needs?

There are great concerns about the exploitation of construction workers, often by the use of bogus self-employment, and the abuses of human rights and risks to the safety of too many workers through the behaviour of some unscrupulous employers. What are the Government’s plans to protect workers through this deal?

The deal appears to ignore the important role played by smaller firms. What is in the deal for small builders, for whom accessing investment in new technology is likely to be a challenge?

This week’s Jaguar Land Rover announcement that it might move production out of the UK and re-evaluate its planned £80 billion of investment is deeply worrying, not least for the 40,000 workers directly employed. JLR’s is just the latest in a string of warnings from manufacturers vital to the success of British industry, and the same warnings apply in construction and throughout the construction supply chain. The Government’s mishandling of Brexit makes a mockery of their industrial strategy; they must listen to businesses and place workers and our economy ahead of ideology.

[Richard Harrington]

I thank the shadow spokesman for taking us on a wider canter through industrial strategy and mentioning Brexit. I will try to answer his questions, but I will also do my best to stick to the sector deal, Mr Speaker, as I know you would like to make progress.

I make no excuses about the time this has taken because we wanted to get it right. We are always pressed on occasions like this to use words and phrases like “soon”, “imminently” and “at the end of the year”.

[Bill Esterson]

A few weeks?

--- Later in debate ---

[Richard Harrington]

Well, this is a few weeks: we are talking about nine months, and nine times four is about 36 weeks, which is a few weeks compared with 5,000 weeks. But the hon. Gentleman makes a serious point, and we did want to get this right.

Sector deals are no longer just Government edicts. They are true partnerships with not just the usual suspects but lots of companies in industry, and we have done our best to get this right and make it as comprehensive as possible. I am sorry that the delay has put the hon. Gentleman out, but I believe we have got it right, and I welcome the more positive comments he made, among quite a lot of negative ones.

I would make the same point about the other sector deals the hon. Gentleman mentioned, such as that for rail. We are working on them: there is no go-slow; Ministers are not off playing golf. These are very important to me; this is a big chunk of my portfolio and I do hope that at least privately the hon. Gentleman will accept that I do my best with diligence to try to get to the bottom of these things. But they are very comprehensive: the documents may contain a few graphics and things in colour, but they are serious documents, and, more importantly, the deals behind them are very serious.

The hon. Gentleman rightly raises Carillion as that is an important matter. There are a lot of things to be learned for the future from what happened. The Government have worked very well with banks and other institutions. We have taken on board the wider lessons to do with the Insolvency Service and so forth, we have consulted a lot of people on Carillion, and we are on the way to showing companies like Carillion that directors cannot behave irresponsibly, because the consequences are very significant. They affect not only shareholders and banks; they can affect millions of people and small and large businesses alike.

The hon. Gentleman mentioned the Government’s attitude to research and development expenditure. I am proud of our aspiration of 2.9% of GDP for research and development. In dealing now with these bids for the industrial strategy challenge fund and so forth, we are seeing a very significant increase in Government expenditure on research and development. It is a very large part of BEIS’s budget.

The hon. Gentleman mentioned the Labour party’s view that everything should happen now or more quickly: well, it did not do so in all the years Labour was in power. I try not to make party political points if I can possibly avoid it, but I think history will show that our record in increasing research and development spending is very good, and in practice sector deals are the conduit through which it is used. Gone are the days when Government Departments and institutions like the National Economic Development Council, which I remember visiting as an A-level economics student at school, did this; gone are the days when civil servants and Ministers decided where this money was invested. There is now a thoughtful process, independently held, in our case through Sir Mark Walport, and I am very hopeful that in the future more money will be spent through this process.

The hon. Gentleman asked a reasonable question about how significant a part of the agenda skills were. For construction, skills are without doubt critical. Most people in construction currently talk about skills shortages, and the increased number of apprentices that is aspired to in this sector deal certainly cannot be taken lightly. I have seen the way young people are being trained up through apprenticeships, and there is also the retraining of older people, the T-levels and all the other related educational matters that I do not have time to go into today. They will all make a significant difference to skills.

It is true, too, that different skills will be needed in the future, as I saw from the type of skills being used during a recent visit I made to Skanska, in Rickmansworth near my constituency. Computers are now used not just to make the design we are so used to in building but in the detailed technicalities for each part of the project. I was shown an example in Paddington station where every material for every panel will be passed to owners of the future, because part of the sector deal is about the whole life of buildings, not just the original construction which was traditionally the most important aspect.

Finally, the hon. Gentleman mentioned workers’ conditions, and who is and who is not an employee and so forth. He will know about the Taylor review and that the Government are accepting almost every recommendation Taylor makes. That will make a significant difference to people’s lives.

[Several hon. Members rose—]

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I welcome the statement. It mentions the patient capital review, which aims to increase the availability of long-term finance for innovative firms, so will the Minister confirm that that will be targeted at small and medium-sized construction companies?

[Richard Harrington]

I will try not to mention a constituency example here, Mr Speaker.

I thank my hon. Friend for that question. Capital is important. It is often spoken about in terms of large fundraising exercises, such as bond issues and initial public offerings, but it is important that small firm financing is also taken into account. The banks are proud of the fact that they are significantly increasing their small business lending, and we intend to monitor that carefully.

[Ronnie Cowan (Inverclyde) (SNP)]

I thank the Minister for advance sight of the statement. I noted with interest that the statement refers to

“a joint £420 million investment from the sector and government”

and

“£600 billion of public and private investment in infrastructure over the next 10 years”.

I was wondering about the split between public and private money. With Carillion in mind, where will the risk lie in such joint ventures? It would be remiss of me not to ask how much of the new money will be given to the Scottish Government to spend, because they have a good track record on major infrastructure builds.

The statement also says that 1.5 million new homes will be built. Will the Minister guarantee that, within the specifications for the new builds, every effort will be made to ensure that buildings are environmentally-friendly to build and energy-efficient to run? There are remarkable examples from around the globe that can be taken on board and copied. The efficiency and longevity of new buildings is crucial.

I welcome the intention to create more apprenticeships, which have been much neglected since the 1980s—hence why a third of the workforce are over 50. The Scottish Government have been leading the way in creating meaningful apprentice schemes, and I am really pleased that this place has decided to follow.

Finally, given that export capability has rightly been identified as so important, will the Minister fight for tariff-free access to European markets at tomorrow’s Cabinet showdown on Brexit?

[Richard Harrington]

I will do best to answer without the global canter that you so politely reprimanded me for using, Mr Speaker. There will be no more cantering, or indeed galloping for that matter. I shall do my best to trot, if that is possible—I promise the hon. Member for Inverclyde (Ronnie Cowan) that I am not trying to cut my answer down.

The SNP spokesman’s first question was about the mixture of public and private capital, but that depends on the projects that are available. We know what money is in the current spending plans, but we also know about projects that are coming through, such as Heathrow. I cannot give him an exact split, but we are certain that the total amount that was mentioned will come to fruition, and I am conscious of the fact that Scotland must get its share. That point was well put and well noted. I am certain that Scottish Conservative Members—[Interruption.] They are in Scotland. I am sure that all Scottish Members will take me and other Ministers to task if Scotland does not get its fair share.

[Several hon. Members rose—]

[Richard Harrington]

Scotland will get its fair share—[Interruption.] Ah, I thank the shadow Minister for pointing out what was happening behind me, because we do not yet have eyes in the backs of our heads, although I am sure that a Labour Government would give them out free to everybody.

The hon. Member for Inverclyde made a good point about fire safety and energy-efficiency specifications for new homes. I have visited the Building Research Establishment in my constituency—I thought you might be interested to know that, Mr Speaker—where state-of-the-art work is going on. If the hon. Gentleman was referring to the terrible tragedy at Grenfell, I am sure that lessons about construction types will be learnt.

Apprenticeships are an important part of the sector deal, and they mean a lot. Apprenticeships do not have to be for school leavers, which has been the tradition. There will be a lot of retraining, and the Government recognise that in their policies, but the purely physical tasks that made up the majority of construction jobs in the past are slowly being replaced with jobs that require a significant amount of training and a lot less physical effort.

Finally, the hon. Gentleman asks me to ensure that the Prime Minister makes it certain at tomorrow’s Chequers awayday that UK companies will be able to export their products to the European Union. I can happily assure him that that is very much the case.

[John Howell (Henley) (Con)]

I welcome what the Minister says about the 25,000 apprenticeships, but one of the grand challenges facing the Government is helping to meet the needs of an ageing population. How does the deal help to meet that need?

[Richard Harrington]

I thank my hon. Friend for his question. The answer is that the type of apprenticeships will be commensurate with the new types of skills within building. As I explained in answer to the hon. Member for Inverclyde, that will involve retraining at different ages, as well as jobs that involve skills other than physical skills, which were complex but were done just by young men in the past. In fact, I am pleased to say that many more women are now involved in construction apprenticeships, and we will start to see people of my age doing apprenticeships—quite a few people in my constituency probably hope that that will be me in a few years’ time.

[John Spellar (Warley) (Lab)]

I congratulate the Minister on his pre-reshuffle tour d’horizon of the industry and on a statement that is welcome in both its intentions and its aspirations. However, without any detailed measures, it is frankly just more waffle. For example, the Minister rightly drew attention to the forthcoming infrastructure programme, where local and national Government have huge clout as the client, so will the Government be using that influence to put into their contracts requirements for the prompt payment of subcontractors? In addition, will they demand proper ratios of apprentices on sites, by which I mean real craft apprenticeships to fill the huge skill gaps and to provide career opportunities for our youngsters?

[Richard Harrington]

I shall send the right hon. Gentleman a copy of the construction sector deal so that he knows that it is not just meaningless waffle, [Interruption] I am delighted he has one and I will do my best to respond to the numerous points that he made. He asked whether the Government would use their power over those things that they fund to ensure that small businesses are used—that is correct. The Government are keen on using their power in that way, such as by mandating the use of level 2 building information modelling for all construction projects to encourage the adoption of digital technologies. The Government will also be at the forefront of the manufacturing of buildings off-site for suitable projects, such as schools and NHS buildings.

The right hon. Gentleman was concerned that the Government should not use such powers to affect the number of apprenticeships on site. That is very much our policy, and it will be part of the tender documents to come. However, I hope that that will not be necessary, because the industry is desperate for apprentices and we will see a lot of the new types of apprenticeships.

[Vicky Ford (Chelmsford) (Con)]

In Chelmsford last week, local councillors approved a local plan that includes 8,800 homes on new sites, and 11,700 homes have already been approved. We are building schools, GP surgeries, community centres and the amazing new medical school, so masses of construction is ongoing. The sector deal is welcome, but Chelmsford College has two issues. One is finding tutors with the experience to teach apprenticeships; the other is getting apprentices placed with smaller businesses such as electricians. Can you focus on addressing those two pinch points?

[Richard Harrington]

Mr Speaker, I thought you were going to reprimand my hon. Friend for referring to me as “you”; thank you for forgiving her.

I accept that finding more tutors is a problem, and the Construction Industry Training Board is cognisant of that. The Government are making sure everything is done with the training board and there will be new apprenticeship standards. The number of starts will increase to about 25,000, which is a 15% increase. I regularly meet the training board, and I will happily ensure that it is aware of the specific points raised about Chelmsford.

[Tom Brake (Carshalton and Wallington) (LD)]

The Minister will be aware that 30% of people who work in the construction sector in London are EU nationals and that they are younger than their UK equivalents. Meanwhile, the number of apprenticeships has plummeted, particularly for under-25s. What guarantee can he give that we will have sufficient skilled people available, particularly given that the construction sector will be in competition with sectors such as agriculture for those employees? I expect, of course, a very comprehensive reply from the Minister.

[Richard Harrington]

I will do my best—under your supervision, Mr Speaker—to make sure that my reply is comprehensive.

Skilled labour from the European Union is critical to the construction industry, which already competes with all the other industries. Mr Speaker, you will be delighted to hear that last week I visited a wonderful business: Gateville in Watford, which was started by a Romanian gentleman, Bogdan Catargiu. The company is using his skills, and those of his colleagues from this country and the European Union, to build social housing in the UK. Following Brexit, I cannot envisage a situation in which we will not allow people with the necessary skills, such as those in the construction industry, to come to this country to work, and to provide a lot of prosperity to this country—and, I hope, to themselves—as they have over the past few decades.

[Mr Speaker]

It is always a great pleasure to listen to the mellifluous tones of the Minister, who I know from personal experience to be an extremely agreeable fellow, but I gently point out to the House that the statement has now run for half an hour and we have heard from only five Back Benchers. Perhaps there is scope for an improvement in productivity, to be brilliantly exemplified, I feel sure, by Mr Eddie Hughes.

[Mr Speaker]

We often hear from the hon. Gentleman about this blockchain business. I feel I ought to educate myself on the matter.

[Richard Harrington]

Mr Speaker, I feel you are asking me to produce a sector deal for brevity of statements by junior Ministers—I will start work immediately.

The type of skills we need are changing, as we see more modular building and so on. I am sure that the skills that my hon. Friend the Member for Walsall North (Eddie Hughes) and I are aware of now will be very different from the skills needed by generations to come. I expect that he and I will use some skills in our 80s that we did not use 30 years ago. The important part of the sector deal is to make sure that apprenticeships are appropriate for a sector in which one third of the construction workforce are now over 50. Under this fantastic sector deal, the training board and the standards will evolve as the building industry evolves.

[Diana Johnson (Kingston upon Hull North) (Lab)]

I urge the Minister to get a gallop on and announce the sector deal for renewables, which is an important industry for us in East Yorkshire. We are keen to see that sector deal announced. When will he provide details on the local sector deals, which were first announced at the end of last year?

[Richard Harrington]

We have another horse analogy. I said that I would trot, and I have been accused of cantering, but now I will try to gallop. I note the hon. Lady’s point about the local sector deals, and her area is one of our higher priorities. I cannot answer her question about renewables because that is not one of my sectors, but perhaps I can drop her a line or meet her to discuss it.

[Michelle Donelan (Chippenham) (Con)]

I strongly welcome the construction sector deal. With productivity in the construction sector on average 21% lower than in the rest of the economy, it is vital that we tackle that to increase our housing stock. Does the Minister agree that investing in digital and off-site manufacturing technologies will also boost our STEM sector? That is vital for constituencies such as mine, which is a hub of engineering, design and technology.

[Richard Harrington]

The sector deal shows that those types of skills will be adapted to building. Digital technology, artificial intelligence and precisely the STEM skills that my hon. Friend mentions are an important part of the sector deal and of the future construction industry.

[Jim Shannon (Strangford) (DUP)]

What discussions have there been with the devolved Assemblies on match funding for energy-efficient new builds? What is being done to encourage every region to make full use of this initiative?

--- Later in debate ---

[Richard Harrington]

The devolved authorities are very much part of all our thinking. We will continue to work closely with them. I would be happy to meet the hon. Gentleman to discuss Northern Ireland in this context. I congratulate him on his question—and on the questions he has asked at every single statement I have given and every single urgent question I have answered in Parliament.

[Huw Merriman (Bexhill and Battle) (Con)]

Is it not the case that if there were further incentives for construction companies and developers to build out, they would be forced, as it were, to recruit and train more people, because they would need them, rather than moving people from one site to another? Is it possible for the Government to consider compulsory purchase powers for local authorities if developers do not build after a couple of years or, indeed, to consider charging council tax 12 months after a planning application is approved, rather than when the build-out occurs?

[Richard Harrington]

The review by my right hon. Friend the Member for West Dorset (Sir Oliver Letwin) is considering those points, and I am sure that we will be delighted to report the review’s progress to the House.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

As a chartered civil engineer, I welcome the principle of the construction sector deal. On protecting the supply chain, the Government must deal with two key issues: the elimination of cash retentions; and, as the Minister knows from his previous role, the effect that multi-employer pensions are having on subcontractors, particularly plumbers. Will the Minister review the Multi-employer Pension Schemes Bill—my private Member’s Bill—and have a word with the Under-Secretary of State for Work and Pensions, the hon. Member for Hexham (Guy Opperman), to ask him to take on board the measures in my Bill?

[Richard Harrington]

We are currently considering the entire policy on retentions, as I am sure that the hon. Gentleman knows. We are reviewing the responses to our consultation and considering the options for future policy.

[Maggie Throup (Erewash) (Con)]

When we consider construction, we often think about only what we see above ground. Saint-Gobain and Stanton Bonna in my constituency make pressed concrete and cast pipework. Can the Minister reassure the House that his statement on the construction sector deal will benefit all aspects of construction, whether invisible or visible?

[Richard Harrington]

Absolutely; I can reassure my hon. Friend on that point.

[Mr Philip Hollobone (Kettering) (Con)]

What is there in the construction sector deal to encourage small builders in Kettering?

[Richard Harrington]

My hon. Friend, as always, speaks up for Kettering, and he does so well. Kettering is typical of many places in the country where small businesses are the core of the construction industry. The sector deal is not silent about that. [Interruption.] The shadow Minister is chuntering that he made that point—he did, and he is absolutely right.

Small businesses are the core of the construction industry. On every visit I have made to the tier 1 large contractors, they have been very conscious that small businesses are part of the industry. We have to make sure that those small businesses get their share of the expenditure on apprenticeships, as they are getting, and make it easier for them to get apprentices, which we are doing. The training board and the industry bodies we work with are conscious of that.