Hinkley Point C

Debate between Lord King of Bridgwater and Lord Henley

Tuesday 26th June 2018 Lords Chamber

[Lord Henley]

My Lords, again, there is no lack of clarity on this. The Statement made five years ago—“all those years ago”, as the noble Lord put it—made it absolutely clear that the approximately £128 million which was likely to come through business rate retention would come after the plant became operational. Meanwhile, there will be the benefits that I enunciated, which will come through the company building this project. On top of what I already mentioned, there is the spend it is making down the supply chain in the west of England—£450 million so far. So considerable benefits are already on their way, but business rate retention does not come into play until later.

[Lord King of Bridgwater (Con)]

My noble friend will be aware that this is taking place in my former constituency. It is one of the largest construction projects in Europe. People there are already facing fantastic lorry traffic: a figure I saw recently was 750 lorries a day going along not entirely ideal road routes. The local community is already making a substantial contribution by tolerating this terrific volume of construction traffic and all the work involved in it. My concern—the noble Baroness, Lady Featherstone, made this point—is that I understand that the real community benefit does not kick in until 2025. Actually, the community is making its contribution now. A lot of people do not have jobs there and will not be working there—some will, but only a relatively small number. We ought to find some way to ensure that the community benefit takes place at the time when the community is really suffering as a result of the present commotion and activity.

[Lord Henley]

My noble friend, with his local knowledge as the former Member for that area, knows exactly what his former constituents are going through, and he is right to address those points. All sites of this sort go through a rigorous planning process. In that process, it is possible for the planning authorities to grant planning permission through a Section 106 agreement, looking to get benefits from the developers in that area. That has been dealt with by the local authority in that process.

On top of that, as I made clear in earlier answers, there are also the advantages to the area through spend in the area—I mentioned the spend directly on the site, on the roads and on other things, the contribution that EDF is making, as well as the spend on the supply chain in the entire south-west region.

GKN/Melrose Takeover: Update

Debate between Lord King of Bridgwater and Lord Henley

Tuesday 27th March 2018 Lords Chamber

[Lord King of Bridgwater (Con)]

My Lords, the House will recognise that this is a very serious announcement about a major British company that is obviously facing some difficulties in its present operation and is now the subject of this takeover bid. It is extremely worrying that this has occurred at a time when, obviously, the future prospects for our economy are far from certain in the present Brexit developments. The Secretary of State was absolutely right to ask for the clearest undertakings, although, as the noble Lord from the Front Bench said, it has come rather late. I do not understand at all the idea that the Secretary of State has up to four months in which to intervene in something that may have already taken place. However, he does recognise that it is not just a matter of national security: the Secretary of State says he has a wider concern that the takeover should not act against the interests of the economy. He asked for undertakings from Melrose Industries plc, but I find them extremely inadequate. The company says that it is prepared to give an undertaking to maintain its UK listing and UK headquarters for five years, and to,

“ensure that the Aerospace and Driveline divisions retain the rights to the GKN name”.

However, it goes on later to say that if a strategic purchaser comes forward with an investment proposal prior to 2023, it hopes that it would be allowed to consider that. It goes on to add:

“Unfortunately, as a result of the nature of the transaction, we have not had access to the information we would expect in order to make detailed commitments”.


By the end of that, I wonder just what commitments are being given. This is a very serious matter and the Government need to think very carefully indeed. I pay tribute to Melrose, which is obviously an extremely successful company, whose business will be to acquire it and to sell it on. No doubt it will make a great success of that, and full marks to it for its approach. Whether or not it is appropriate in this situation, a heavy burden is on the Government to get far clearer and far more binding undertakings that will give some form of security to an essential part of the UK industrial economy.

[Lord Henley]

My Lords, I note exactly what my noble friend has said. As he said, my right honourable friend has up to four months to consider these matters, depending on the advice he receives from colleagues in the Ministry of Defence. I am also grateful to my noble friend for referring to the response from Melrose. It is not for me to say whether that is a good or bad response; I just note that, ultimately, it has to be a matter for shareholders and others. But parts of that, as I made clear—the letter is now in the public domain—will be enforceable commitments, albeit some of them for only five years, and another part will be undertakings of a less enforceable nature. It is not for me to defend or attack that letter. I have simply set it out as the response that my right honourable friend the Secretary of State received from Melrose following his letter, in which he set out, first, his legal obligations under the 2002 Act—which gave him a relatively limited power to intervene, which is quite appropriate. Secondly, however, he stressed—I am grateful to my noble friend for underlining this—the wider interests he has as Business Secretary and the wider interests that the directors have under Section 172 of the Companies Act as regards what they must look at. In the end, the shareholders will have to take a view on that matter. As I said, it is possible that my right honourable friend will have to make a decision in a quasi-judicial manner. He must await advice on that, and at that stage, if appropriate, he will intervene.