Nuclear Safeguards Bill

Lord Teverson Excerpts

Committee: 1st sitting (Hansard - continued): House of Lords
Thursday 22nd February 2018 Lords Chamber

[Lord Rooker (Lab)]

My Lords, the amendment can only be delivered by people, and it is the issue of people that I want to raise with the Minister, because I think that his letter is in fact quite worrying. I first go back to the evidence taken by the Lords EU Energy and Environment Sub-Committee on energy security on 13 September. We had two groups of witnesses, and the second group was essentially on Euratom, with witnesses from the Institution of Mechanical Engineers and EDF—which of course runs most of the nuclear power stations and is building one—and Dr Golshan, the deputy chief inspector at the Office for Nuclear Regulation.

Having been asked how we were going to be able to deliver what is needed by the IAEA, Dr Golshan, in answer to Question 37 asked by the noble Viscount, Lord Hanworth, said:

“I started off by saying that we are building capability and capacity and we are recruiting experts in the safeguards area … the extent to which we can equip ourselves depends on the scope of the safeguards arrangements that the Government are working towards. That, in turn, depends on the outcome of the negotiations with both IAEA and Euratom. We are working towards having a regime in place that enables the UK to fulfil its international reporting obligations to the IAEA and to meet the reporting requirements of our nuclear co-operation agreements. We see that as a much more realistic starting point that we can build upon and build in additional layers of assurance as currently provided by Euratom”.


That was basically telling us, “We are not going to deliver”. That is what that means. Dr Golshan concluded her answer to that question:

“To seek to replicate Euratom standards arrangements by the end of March 2019 will be highly challenging and, while we would work towards that, we want a starting point that allows the UK to meet its obligations”.


Later on, in answering another question, Dr Golshan said:

“We currently have 10 staff in our safeguards function. I should not call it an inspectorate. We need another 12 to get to a level where we are able to provide the required reporting arrangements. If additional assurance layers are required we will need to staff to a higher level. Currently what we have, as I said, is based on the fact that we have been a member state of Euratom”.


She went on to alert us to what would need to be put in place to meet the roles and responsibilities that will be placed on the ONR. In answering a question from the chairman, the noble Lord, Lord Teverson, she said:

“The first one is to have an IT system that allows us to collect and process data and then provide a report to the IAEA”.


I have seen nothing about that because clearly a new IT system is required. Dr Golshan continued:

“That means the UK would meet its international obligations as part of the non-proliferation treaty. The second element is that we should be able to facilitate IAEA’s activities in the UK. The third element is that we should have suitably experienced staff to undertake verification activities”.


In a later question, Dr Golshan was asked about the staff and she said:

“The biggest risk that I see is our ability to recruit”.


Of course, there has been free movement while we have been in Euratom and recruitment has not been a problem. Not everybody that is needed in the nuclear industry fulfils the Home Office requirement for getting into the country. We are not going to be able to build Hinkley, for a start, because we cannot get the steel erectors into the country. We need half the country’s steel erectors on Hinkley at one point. We will not be able to get them in. They are not qualified in terms that allow the Home Office to let them in.

I am sticking to the point of what will happen about the staff because we were then told in the report, which was published only a few weeks ago, that the training programme to train people to become fully trained new inspectors lasted between 12 and 24 months. Therefore, my first question is: why have six months been lopped off that figure in the Minister’s letter? What has happened to change that timescale between now and when the committee received the evidence? Have more resources been put in? Have the criteria changed? That is quite a big change, bearing in mind the timescales we are working to. We do not have a lot of time. In addition to the training lasting from 12 to 24 months, the committee was told that we need more staff anyway because the existing staff are not inspectors. The Minister’s letter flags that up and refers to 11 safeguards officers, all of whom will undertake training to become inspectors by March. The Minister then chose to put the next sentence in bold type. I assume that that was his choice to reinforce his assessment that the ONR will be in a position to deliver the international standards. The international standards mean lower standards than we have now. That is the assumption because they are not the Euratom standards.

The Minister went on to say that the ONR will require a team of 30 to 35 people, which was implied in the answer given by Dr Golshan that I cited earlier when she said that the ONR would need more staff. The ONR is recruiting but the fact of the matter is that a far more interesting choice of jobs in this industry is available in the rest of Europe than in the United Kingdom, notwithstanding the fact that I understand that a quarter of Euratom’s inspections take place in the UK, so there is quite a big capacity there. But, of course, we have not been doing that. We did not need to recruit or train people because we are members of Euratom.

The Minister went on to tell us that since the evidence was taken back in September and October—the report says the end of October—the ONR has managed to recruit the princely sum of four individuals. Where did they come from? I would like to know. Are they from the UK? Some 98% of its staff were from the UK or had dual nationality when the evidence was given. Where did the four come from? Why is it only four? If this matter is being dealt with urgently does that figure reflect salary levels or other matters relating to the job such as promotion prospects or seniority? Can the training programme cope with upskilling the safeguards officers to become safeguards inspectors?

The issue here concerns the staff but the Minister’s letter did not really address that issue. First, we are told there are only four. That is not enough. They cannot be trained in time, and in the Minister’s letter someone has lopped six months off the period given to the Lords Select Committee. Why is that? There must be a reason for it. I presume that someone reads the evidence given to your Lordships’ Select Committees from representatives of industry and other sectors. I would like to know the answers to those questions because if there is confusion about the number of staff, their training and recruitment at this point in time, we are heading for real trouble. That is clearly the case. Therefore, I hope the Minister has come to this debate prepared. I know that we are in Committee, so I apologise for the detail of my questions, but that is what this stage is for. We need some answers on this issue before we move on to the next stage.

[Lord Teverson (LD)]

My Lords, I thank the noble Lord, Lord Rooker, for having gone through all that. That session of the committee which I chair was an eye-opener. That is why I tabled my Amendment 10, which we will consider in the next sitting of the Committee. The amendment is about labour mobility, which is an absolutely key factor in terms of not just safeguarding but the nuclear industry as a whole. I look forward to continuing that debate on that occasion and very much agree with the comments of the noble Lord, Lord Rooker.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)]

My Lords, I hope that I can respond to and deal with the various points that have been made. I am very grateful for all the contributions that have been made, particularly from my former noble friend, the noble Baroness, Lady Featherstone, who stressed that she wanted reassurances. I think that was the gist of what the noble Lord, Lord Rooker, said as well. He was seeking reassurances on when the ONR would be ready and whether we would meet the appropriate standards under the IAEA and so on.

I will refer back to the letter that I sent to all noble Lords, to which the noble Lord referred, and remind them of that. I also remind the Committee that we have committed to a domestic nuclear safeguards regime that is equivalent in effectiveness and coverage to that currently provided by Euratom. That is the commitment that we have made and I repeat it to the noble Lord, Lord Grantchester. That means a level of inspections and other regulatory arrangements—it is not just inspections—that goes beyond the normal international standards as applied by the IAEA that would be expected from the United Kingdom: for example, additional assurance and verification activities at additional facilities.

It is crucial that we meet all those international standards following our withdrawal from Euratom. Compliance enables the United Kingdom to discharge international commitments and would also underpin international nuclear trade arrangements with key partners such as the US, Canada, Japan and Australia. It is right therefore that the ONR focuses its efforts on ensuring that the United Kingdom is able to meet those standards immediately on withdrawal from Euratom and seeks to move to Euratom standards as soon as possible thereafter. The important thing is that we get to the IAEA—I hope I have got the letters in the right order; it is difficult to remember sometimes—as soon as possible thereafter.

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[Lord Henley]

I am answering the question but the noble Lord is enjoying himself. The ONR is recruiting and will make sure that it has the right people to provide the appropriate safeguards regime on 29 March next year to meet IAEA standards. Obviously we are not going to impose restrictions on where employees go thereafter. Is this a new policy being developed by the party opposite, that once people are trained in any job, they cannot move on and have to stay? These people will be employed by the ONR, and it is then a matter for the ONR to make sure that they have an attractive career and wish to continue working for the ONR. I am sure they will find that it is an attractive career and will want to stay

I am equally sure that they will do the job very effectively and that the ONR will feel confident that, with its recruitment processes, it can provide the appropriate safeguarding regime to make sure that we meet IAEA standards by 29 March next year.

[Lord Teverson]

My Lords, I think it was the noble Lord, Lord Grantchester, who mentioned the requirement for information technology systems, which is always the other area that needs to be looked at. When we get to my amendment in the next Committee sitting, I will certainly come back on the points that the noble Lord, Lord Rooker, raised about churn, as that is important. However, are we also confident that we will have information technology systems in place? What nature will they take, in a very broad sense? Will they be Excel spreadsheets or something more involved?

[Noble Lords]

Oh!

[Lord Teverson]

It is amazing what you can do with Excel spreadsheets, and I suspect that most systems are based on something like that. I would be reassured if that were the case, but if it is rather more sophisticated, I start to get concerned.

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[Lord Carlile of Berriew (CB)]

My Lords, I would like to speak to Amendments 14 and 15 tabled in my name, and in particular to the proposed new clause set out in Amendment 14. I would never insult the Minister by accusing him of being overly sensitive; nevertheless, he will have realised that there is a great deal of genuine concern about what is going to be delivered in relation to Euratom on 29 March 2019. I support what the noble Lord, Lord Warner, just said, which was in the same vein.

My suggested new clause would require the Government to answer certain criteria by that date. The criteria are set out clearly and they have been shown, in the debates on this Bill and on the withdrawal Bill yesterday, to be the ones that cause concern around the House and which the Minister has heard repeated time and again. In debating terms, this has basically been a one-horse race in relation to concern about Euratom.

Yesterday—and I will not repeat them—I cited some answers that had helpfully been supplied by the Minister to questions raised by the Society for Radiological Protection and by me as a result of that society’s representations. What was clear from those answers was that the Government do not know what will be delivered or when. This afternoon, I will cite another piece of evidence that draws the same conclusions. On 12 February, just over a week ago, there was a meeting between 10 officials—nine from the Department for Business, Energy and Industrial Strategy, one from Public Health England and the two senior relevant officers of the Society for Radiological Protection. I have in my hand a record of that meeting, which I feel sure is accurate.

In that meeting, there was what was described as a “Euratom exit update”. One of the officials, who was clearly a senior and responsible official—it is invidious to name officials, so I will not name him or her—noted that the Nuclear Safeguards Bill is currently going through the House of Lords. The official noted that,

“at current there has been minimal industry engagement, due to the short timescales to pass the bill. However”—

the official—

“did note that the bill is a skeleton, and more detailed consultation with industry and professional bodies would take place as the regulations are developed”.

All I am asking for, in my new clause suggested in Amendment 14, is the key to the skeleton or the cupboard where the skeleton is kept.

The official noted that,

“discussions are going well internationally”,

which is very welcome,

“with progress being made on bi-lateral agreements with the US, Australia, Canada and Japan”.

We would certainly like to know more about that. The official then explained—and this is very important—that,

“as part of the EU exit process they”—

the 10 officials—

“are unable to pursue agreements with the various EU countries”—

I think “pursue” means seek—

“till the exit process is complete”.

If that is right, it is extremely worrying. I am sure that the Minister can be supplied with a copy of the minutes of that meeting.

It was also noted that,

“there have been wider EU civil nuclear issues around legal ownership of fissile material and radioactive waste”.

Contained in that single sentence is a host of problems that will have to be unravelled in great detail if there is to be proper nuclear safeguarding.

Having read those notes, with the welcome support of the noble Lord, Lord Fox, I tabled Amendment 14. It requires the Secretary of State to publish a report setting out the answers to all these questions before 29 March 2019. It requires the making of,

“regulations providing for the implementation of any agreements covered”,

by the clause and a statutory instrument which should be approved by each House of Parliament.

There is an evidence base for the kind of quality assurance that any responsible Government would demand of any contractor to which they were letting a contract. As a Parliament, we are entitled to demand, respectfully but necessarily, a similar level of quality control for the Government before we lose the legislative opportunities available to us and throw this enormously important issue to the wolves—or to a skeleton.

[Lord Teverson]

My Lords, I will speak to my Amendment 9. One of the things I have tried to do in this amendment—I could not do it completely satisfactorily because of where we are in the Bill—is to ask what are the key things we need in place before it is safe and practical for us to leave Euratom and the system we have. There were three specific areas that we needed to cross that finishing line before we entered out into this brave new world. They are listed and they are very clear.

The first is that we should have an agreement from the International Atomic Energy Agency that our safeguarding procedures and the body that we are talking about in the Bill are approved. We need that; without it, we are unable to move forward. Secondly, because we are one of the few nuclear weapon states in the world, we need a voluntary offer agreement with the IAEA that relates to our new status outside Euratom. Thirdly and very practically—we have had a description of the difficulties around this—we need active nuclear co-operation agreements that have been confirmed or agreed by the other side. Whether we can get grandfathering rights on them is very difficult in some instances—the one with the United States has been particularly highlighted in that degree—but we also need to have those in place for those nations where we have active nuclear trading of the type of products listed in the schedules of the Euratom treaty and under the international agreements of the IAEA.

The difficulty in drafting this amendment was that if we do not have these in place, what do we do? My solution to that was very simple: that we should seek temporarily—as the Minister said, we have already gone through the process of agreeing withdrawal from Euratom, rightly or wrongly—to withdraw the notice under Article 106a until we have those three areas of agreement in place and we can be certain that we can go ahead. It is my opinion that we can do that ourselves unilaterally. More certainly we would need to get the agreement of the 27 other member states. That would clearly be the right answer, in that we would continue to be a member until we had those in place.

I was unable to put that in the amendment because it was out of the scope of the Bill, apparently, so I have looked to move on. What we would have to do here is, effectively, to have a transition period. On that, I come back to my question to the Minister that I raised in the first grouping of amendments: do we know that there will be a transition period with Euratom, the negotiation on which, as I see it, is going ahead and will have to be agreed or not on 22 March—it is only a month away—and that we can indeed somehow satisfactorily subcontract all these responsibilities to Euratom and to the international agencies should one of these vital areas go wrong? That is an entirely reasonable question for which I would expect us to have a workable strategy to avoid that cliff edge, if that should happen for all sorts of reasons that, quite clearly, are not totally in the Government’s control. From that point of view we need contingency and to understand the route map if those three areas are not fulfilled. I look forward to the Minister’s response on them.

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[Baroness Vere of Norbiton]

I thank the noble Lord for his intervention. I am on paragraph 11. I have many more paragraphs to go and I hope that in those paragraphs I will be able to keep him very happy indeed.

I understand and share the sentiment of wanting to maintain a close relationship with Euratom. The noble Lord, Lord Warner, mentioned this relationship and it could indeed include any of the things that he mentioned, but they are subject to the negotiations. However, we have already stated very clearly that the Government will seek a close and effective association as part of phase 2 of the exit negotiations with the European Commission. What we cannot accept is that the regulations must await a definitive outcome of talks which are by their nature uncertain in both timing and result. It is therefore vital that we continue to work to enable the set-up of a domestic safeguards regime, and to have ready the bilateral safeguards and nuclear co-operation agreements that we will need to function as a responsible nuclear state from day one of exit.

This approach will reassure the international community that the UK remains committed to nuclear non-proliferation, and will provide clarity to industry that it will continue to be able to move vital materials, parts and expertise once we leave Euratom. There can be no question of waiting until we know the outcome of the negotiations on our future relationship before we can put in place our own arrangements. The implications of not having the right systems operating from when Euratom safeguards arrangements no longer apply are too serious for industry and for our position within the international civil nuclear community.

[Lord Teverson]

Can we actually make this clear? I have not heard anyone in this Committee saying, “Please, Her Majesty’s Government, do not do anything until this thing is finished”. We are not asking for anything to be delayed, we are saying, “Please get on with it”, but we need some information on the way; we have to have some idea of the destination, and Brussels wants some idea of the destination by 22 March and then in October. If it does not happen, what are the contingency plans? We are not asking for anything to not happen now. I do not think the Minister understands that. Did I hear anybody say that?

[Lord Warner]

I put in this provision about regulations only out of sheer frustration because one cannot get any information out of the Front Bench about what that relationship will be. I am not seriously going to stop the Bill proceeding but there is a very high level of frustration across the Committee that the Government cannot explain in any way what relationship they are aspiring to. For example, do the Government want to talk to Euratom about seconding some inspectors to the ONR for a period of time to get it over the hurdle of the transition to a UK regulator? That is the kind of specific thing which it would be quite sensible to discuss. No one is going to stop that. We just want to know what the Government are trying to do.

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[Lord Carlile of Berriew]

I am grateful to the Minister for giving way. I suspect that she is now on paragraph 15, but she is not answering this debate, which is about whether Her Majesty’s Government are prepared to provide specified information to Parliament on certain criteria. What she is telling us would all be very interesting if we had not heard it many times before, but it is a dissertation on the roles of different organisations. Can we please have an answer to this debate? It is 4.32 pm on a Thursday and I would have thought that it could be answered in a few paragraphs—maybe numbers 47 to 50.

[Lord Teverson]

I was happy with the answer that the Minister was giving about NCAs.

[Baroness Vere of Norbiton]

With the greatest respect, I did not interfere in the writing of the speech of the noble Lord, Lord Carlile, and I will crack on a bit further to answer the points raised by the noble Lord, Lord Teverson, as I too think this bit is very interesting. We are talking about these additional countries because we are obviously going to have to set up NCAS with them, too, for trade to continue. I assure noble Lords that discussions on the four priority NCAs started a while back and are progressing well. They are on track to be completed before the UK leaves the EU. I can also assure noble Lords that this Government, as part of their planning process, have factored in the time necessary to seek parliamentary ratification of the agreements both in the UK and in third countries. This will enable the NCAs to come into force from the moment that Euratom arrangements no longer apply to the UK.

I turn now to the UK’s discussions with the IAEA. Noble Lords will be aware that the UK began formal discussions with it some months ago to conclude new safeguards agreements that would replace those between the UK, IAEA and Euratom when the Euratom arrangements are no longer applicable. These discussions, which began some months ago, as my noble friend Lady Neville-Rolfe mentioned, have been constructive and fruitful, and substantial progress has been made. I can be a little more specific: formal negotiations started last September and there were several rounds of preliminary meetings before that. There have been two rounds of negotiations so far, which have made substantial progress. I hope that that is helpful.

The amendment asks that the IAEA should recognise the ONR as the approved safeguards authority in the UK, as mentioned by the noble Lord, Lord Teverson. I will make it clear that the IAEA’s focus in respect of the UK’s safeguards lies with the voluntary offer agreement and additional protocols rather than with the domestic legislation underpinning the domestic regime or the UK Government’s arrangements for fulfilling their commitments. However, as I have set out, the Government have already held productive and fruitful discussions with the IAEA on the UK’s future safeguards agreements and understand what the IAEA requires of us in setting up the system. It is not necessary to consult on the detail of legislation or on the ONR’s readiness to implement the new regime with the IAEA.

As my right honourable friend the Secretary of State for Business, Energy and Industrial Strategy set out in his Statement to the House in September last year, the Government are seeking new agreements with the IAEA that follow exactly the same principles as the existing ones. This will ensure that the IAEA retains its right to inspect all civil nuclear facilities and to receive all current safeguards reporting, ensuring that international verification of our safeguards activity continues to be robust.

In addition to this, the Secretary of State set out on 11 January the Government’s intention to update the House on our overall progress with Euratom, including on the EU negotiations and other important matters such as international agreements. I trust that these reports, the first of which we expect to provide in a few weeks’ time—indeed, just before the Easter Recess—will reassure noble Lords that significant and substantial progress is being made. Indeed, noble Lords will be able to see it for themselves and will no doubt bring it back to the House to discuss, should they wish.

Amendment 15, tabled by the noble Lord, Lord Carlile of Berriew, inserts two new subsections and seeks to require that, by 29 March 2019, the Secretary of State must present to Parliament a substantially detailed report, along with draft regulations implementing any agreements reached with Euratom relating to safeguards, and have such regulations approved by both Houses. Amendment 14 seeks to prevent the substantive provisions of the Bill coming into force until regulations under Amendment 15 to implement safeguards agreements with Euratom have been approved. While I have sympathy with the noble Lord’s aim of ensuring robust parliamentary scrutiny, the process set out in Amendment 15 would not be appropriate. As we have already discussed in our deliberations on this Bill, I am confident that there are appropriate processes in place to ensure proper parliamentary scrutiny of the substantive powers in the Bill. Noble Lords can be assured that the regulations establishing a UK safeguards regime under the powers in the Bill will be subject to the draft affirmative procedure.

I turn now to the report proposed in this amendment. We have been open about our strategy for withdrawal and our future relationship with Euratom. In the Written Ministerial Statement on 11 January, we outlined a twofold approach under which we are seeking a close association with Euratom through our negotiations with the European Union. I refer noble Lords to the Written Ministerial Statement. It goes into some detail about our specific objectives in relation to a close association with research and training, continuity of open trade arrangements and close and effective co-operation on nuclear safety. This is a very broad ambition of ours, and it goes much further than the nuclear safeguards that we are specifically talking about today. Simultaneously with these discussions about our broader relationship with Euratom, on which we will report to your Lordships’ House every three months, we are putting in place measures to ensure that we can operate as an independent and responsible nuclear state from day one.

As noble Lords will be aware, we are planning negotiations on a possible implementation period. The Government have confirmed that they intend to include Euratom matters. This implementation period will start after the date that we leave the European Union. This must be taken into account. We are being open with our plans for a domestic regime, and we have been clear on our intentions for the new domestic regime. As made clear in the Written Ministerial Statement, the Government intend to be able to put in place a robust regime equivalent in coverage and effectiveness to that currently provided by Euratom. To put this more clearly, and for the avoidance of doubt, we would be meeting IAEA standards on day one and working our way to Euratom standards as soon as possible thereafter. A key but inevitable difference will be that reporting and assurance activities would be carried out by the ONR rather than Euratom.

The approach of using a domestic body rather than a supranational one to operate a domestic safeguards regime is common among other non-Euratom countries, such as the US and Canada, whose safeguards regimes consist of a state regulator, with the IAEA providing independent international verification. This approach necessitates some differences in the approach of the regime but we do not consider it to necessitate a reduction in standards. To be absolutely clear about independence, it is the international oversight provided by the IAEA and the inspections carried out by its inspectors that underpin the independence of nuclear safeguards around the world. As I have already mentioned, we have committed to providing Parliament with quarterly reports on progress from across the Euratom programme. These reports will include a section on ONR capacity and readiness as well as on research, which was mentioned by the noble Lord, Lord Fox.

Before I close, I want to return to the comments made by the noble Lord, Lord Carlile, about the meeting that he attended with officials. I want to flesh out the Government’s consultation strategy on this because I fear he thinks it is narrower than is truly the case. The Government continue to have discussions with the nuclear industry on the future of the nuclear safeguards regime. In addition to official-level engagement, Richard Harrington, the Minister for Energy and Industry, held a representative industry stakeholder forum in September. There have been further forums since then and the next one will take place on 5 March. The Government have provided the industry with pre-consultation drafts of regulations that we propose to make, and in late February we held a technical workshop on the draft regulations with key nuclear operators.

I hope my explanations have provided sufficient reassurances to noble Lords, and that the noble Lord feels able to withdraw his amendment.

[Baroness Vere of Norbiton]

I thank the noble Lord, Lord Broers, for that comment. I did have a little more flesh on that particular bone so I shall share it now. On the question of research, the Government’s objectives are set out in our recent future partnership paper, Collaboration on Science and Innovation. We are seeking a close association with the Euratom research and training programme, including the Joint European Torus and International Thermonuclear Experimental Reactor, or ITER, projects. The Government have already guaranteed our share of the funding for the Oxfordshire-based JET fusion reactor until the end of 2020, demonstrating our commitment to continued collaboration.

[Lord Teverson]

My Lords, I found part of the Minister’s statement extremely useful and I thank her for that, particularly on the NCA question.

However, there is an issue on which I would like clarity; I think it is very straightforward, and I ask this in a very positive tone. It is the Commission and the EU 27’s offer and negotiating position on transition that the whole of the Euratom acquis is also included in the broader EU transition agreement. Are the British Government in line with that, and will they go down that route as well? I do not hear that we are rejecting it. We have potential issues with the initial situation over residents and people on the EU side, but are the Government saying they are going to have the Euratom acquis as part of the transition that will be agreed, whether that is until the end of 2020 or the two years? If they were saying that, it would take a lot of pressure off what we are talking about as long as the IAEA was happy with it. That seems a very straightforward question and I presume there is a government policy on it. In the response today to Barnier’s negotiating position I did not see any contesting of the Euratom side of it, so I presume we are going ahead and agreeing that transition in March.

[Baroness Vere of Norbiton]

I thank the noble Lord, Lord Teverson, for that interesting question. If it is okay, I shall write to him, because I should like to find out more information about what we are allowed to say at this time.