Small and Medium-sized Enterprises: Public Procurement Contracts

Lord Wigley Excerpts

Monday 7th September 2020 Lords Chamber

[Lord Callanan (Con)]

I can tell the noble Baroness that, since its launch in 2012, something like 20% of our start-up loans have gone to entrepreneurs from black, Asian and minority-ethnic backgrounds and, throughout this crisis, we have hosted a series of round tables on our wider support scheme for BAME businesses.

[Lord Wigley (PC) [V]]

My Lords, the Government are keen in their EU negotiations to allow UK companies to benefit from state aid where appropriate. Will the Minister therefore confirm that it is equally important for the Governments of Wales, Scotland and Northern Ireland to ensure that the SMEs within their own territory are helped to secure public procurement contracts for which those devolved Governments are responsible?

[Lord Callanan (Con)]

Of course, I cannot speak for the devolved Governments, but I am sure they are doing all in their power to ensure that as many small businesses as possible receive contracts.

UK Internal Market: White Paper

Lord Wigley Excerpts

Wednesday 29th July 2020 Lords Chamber

[Lord Callanan]

I think it is fairly self-evident that we are committed to having unfettered access for goods from Northern Ireland to the UK single market, and this legislation will help to underpin that.

[Lord Wigley (PC) [V]]

My Lords, clearly, it is important to get a UK single market working effectively, and that is seen by all four nations to be on a fair and transparent basis. However, does the Minister recognise that the acceptability of these proposals will depend on the credibility of any dispute resolution system? If so, will all four nations have an equal voice within such a system?

[Lord Callanan]

I hope there will not be any disputes, but if there are, they will be legal disputes and the correct forum for resolving those is the courts system. We have no intention of setting up an alternative dispute resolution procedure when we have one of the best and most efficient court systems in the world to resolve disputes.

Rural Post Offices

Lord Wigley Excerpts

Tuesday 9th July 2019 Lords Chamber

[Lord Henley]

My Lords, I agree with my noble friend about the value that we place on the Post Office, and rural post offices in particular. That is why we made that commitment in the 2017 manifesto. Obviously, I cannot make any commitments for the future beyond 2021, when current agreements come to an end. But bearing in mind the commitment we have made and the value we see in the Post Office network, it is exceedingly likely that something similar will be there.

[Lord Wigley (PC)]

My Lords, is the Minister aware of the growing evidence from rural areas, particularly in Wales, of increased crime because of the closure of banks in those areas? Some businesses are having to go 40 or 50 miles to find banks. In those circumstances, can the services available through the Post Office be extended to reduce that danger?

[Lord Henley]

My Lords, I am not aware of that connection with the closure of banks in rural areas causing an increase in crime, but I am aware that there is a decline in bank services in certain areas. I think of my own small nearby town, where both the banks have gone. The important thing is that with the agreement that the banking industry has come to with the post offices, they can provide a great many of the banking services that people require, such as paying in cheques and so on. I could go on in great detail for the noble Lord but there are agreements between the banking sector and the Post Office to help deal with that.

Nuclear Energy: Small Modular Reactors

Lord Wigley Excerpts

Monday 10th June 2019 Lords Chamber

[Lord Henley]

My Lords, I can confirm to my noble friend that Trawsfynydd remains a potential site; it has been neither ruled in nor ruled out. We believe that small and advanced nuclear reactors have the potential to drive down costs through technology and production innovations.

[Lord Wigley (PC)]

My Lords, may I add my support to the bid made in favour of Trawsfynydd? The old nuclear power station there is half decommissioned, but the lake is too small for a full new nuclear power station. Given that the Wylfa project is, to say the least, in doubt, will he look positively at the Trawsfynydd option for SMRs in order to keep this technology alive in north-west Wales?

[Lord Henley]

The noble Lord speaks with great experience on this subject. He was involved in the building of Trawsfynydd, more years ago than he probably cares to remember. I note what he says; he is correct to say that the lake is on the small side for a full-scale nuclear reactor, which might make the small modular reactor more appropriate, but as I said, nothing has been ruled in or out.

State Aid (EU Exit) Regulations 2019

Lord Wigley Excerpts

Thursday 14th March 2019 Lords Chamber

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

My Lords, I beg to move that the draft State Aid (EU Exit) Regulations be approved. I will speak also to the draft European Structural and Investment Funds Common Provisions and Common Provision Rules etc. (Amendment) (EU Exit) Regulations 2019, which were laid before the House on 28 January.

The draft State Aid (EU Exit) Regulations transpose the existing EU state aid regime into UK domestic law by correcting deficiencies in retained EU law. In doing so, they transfer the state aid regulatory functions of the European Commission to the UK’s Competition and Markets Authority. The regulations will ensure that state aid rules continue to operate in a domestic context and will come into force on exit day in the event of a no-deal exit.

State aid rules govern the way subsidies can be given, and exist to stop companies getting an unfair advantage over their competitors. The rules are not intended to prevent public authorities supporting industry, but rather to do so in a way that minimises distortions to competition. Where there are good justifications for state aid, the rules enable it to be given. The state aid rules are about supporting fair and open competition. Ultimately, they are good for taxpayers, consumers and businesses.

The existing principles for the regulation of state aid will remain substantively unchanged in the domestic regime, in accordance with the aims and powers under the withdrawal Act 2018. The provisions in the regulations will therefore have minimal impact on public authorities that grant state aid or entities that receive it.

The main practical change under the new regime is that the rules will be regulated by the CMA. To prepare for EU exit and its new state aid role, the CMA received £20 million for 2019-20. This is in addition to the £23.6 million it received for 2018-19. The Government are working to ensure that the CMA will be ready to take on this new role and have every confidence in its ability to do so.

The CMA will adopt the Commission’s existing state aid guidelines, which provide clear parameters for how and when aid should be approved. It will also receive enforcement powers broadly equivalent to those of the Commission. I should, however, explain one point of divergence from the EU regime. Under EU rules, the European Council has the power in exceptional circumstances to intervene and approve aid before the Commission has reached a decision.

We do not consider it necessary or appropriate to use the regulations to vest the Government with similar powers. Ultimately, the Government could bring forward legislation to amend the state aid rules if deemed absolutely necessary. This option is not readily available to the European Council in the EU context.

[Lord Wigley (PC)]

Will the Minister give way?

[Lord Henley]

I shall not give way at the moment. I will take advice from the noble Lord, Lord Adonis, who pointed out earlier that the noble Lord will have his moment to speak later. It would probably be helpful if I get through what I want to say and the noble Lord can speak later.

I mentioned earlier that state aid rules will ensure fair and open competition throughout the UK. Over the past year, the Government have engaged extensively with each of the devolved Administrations and shared drafts of the regulations. The Government have also offered to sign a memorandum of understanding about the operation of the state aid regime with the devolved Administrations, which we hope to agree. These discussions have indicated broad agreement on the substance of the Government’s policy to establish a UK-wide state aid regime that mirrors the EU’s. We will of course continue to work closely with the devolved Administrations on state aid policy.

In conclusion, as we leave the EU, these regulations will give certainty to public authorities and recipients of state aid, and help maintain confidence for businesses across the UK.

I turn now to the overview of the structural funds SI. In a no-deal scenario, this instrument will repeal the European regulations concerning the European structural funds, while ensuring that they can continue operating domestically. It will also repeal the regulations for the Cohesion Fund, for which the United Kingdom is not eligible. Structural funds include the European Regional Development Fund and its cross-border European Territorial Cooperation component, and the European Social Fund. Structural funds support regional investment across the UK and are funded via the EU budget, with match-funding from project participants. In a no-deal scenario, the United Kingdom is expected to lose access to European funding.

HM Government have guaranteed funding for structural funds projects signed before the UK leaves the EU. The guarantee also enables new projects to be signed after exit until 2020. This guarantee covers UK beneficiaries, all beneficiaries of the PEACE programme in Ireland and Northern Ireland, and Interreg VA in Ireland, Northern Ireland and Scotland.

This instrument facilitates the domestic delivery of structural funds in a no-deal situation. It repeals the European regulations for these funds, as they would become inoperable retained law. It also ensures that for European Regional Development Fund and European Social Fund projects started before exit, current fund delivery rules are upheld through existing funding arrangements—without keeping redundant EU regulations. The powers to continue paying beneficiaries for projects already exist under domestic law. This instrument does not make provisions for projects started after exit. New projects will none the less continue to be signed using existing domestic powers and delivery systems, with appropriate simplifications. Structural funds delivery will also remain a devolved matter.

The instrument also makes special provisions for European Territorial Cooperation programmes that fund collaborative projects. It includes a transitional provision that enables the guarantee to be paid out to bodies involved in a European Territorial Cooperation programme. The power to fund beneficiaries of cross-border programmes currently comes from European law, and therefore needs to be continued in domestic law through this instrument to protect beneficiaries in a no-deal situation. The EU has made special provisions to enable the United Kingdom to continue in PEACE and Interreg VA in a no-deal scenario if the United Kingdom continues to pay its share of the programmes. The transitional provisions in this instrument enable the United Kingdom to make such payments to the EU. This is consistent with the United Kingdom’s commitments to PEACE and Interreg VA.

In this arrangement, the European regulations do not need to be retained. The United Kingdom will sign an agreement with the EU to ensure that programme beneficiaries continue to follow relevant rules. The EU regulation does not resolve the question of payment powers addressed by this instrument. That is why we need both the EU regulation and this instrument to safeguard these programmes. The transitional provision to pay the guarantee to European Territorial Cooperation beneficiaries also ensures that beneficiaries of cross-border programmes other than PEACE and Interreg VA can be paid through the guarantee. Without this instrument, delivery departments would lack the powers to pay out the guarantee to beneficiaries of European Territorial Cooperation programmes.

In conclusion, in a no-deal scenario, this instrument repeals redundant European law while ensuring that projects previously supported by the EU, including those supporting peace in Northern Ireland, are protected. I commend the regulations to the House and I beg to move.

Amendment to the Motion

Nissan in Sunderland

Lord Wigley Excerpts

Tuesday 5th February 2019 Lords Chamber

[Lord Wigley (PC)]

My Lords, the Minister in the other House made it clear that he was reinviting Nissan to submit an application for assistance on possibly different terms in order to overcome the difficulties that might now be facing the company. Can the noble Lord confirm that such an offer will be equally open to companies such as Ford, which is facing similar difficulties in Bridgend?

[Lord Henley]

My Lords, it is open to any company to apply for any funds that are available, as my right honourable friend made clear in the Statement, and that will be reviewed in the proper way, independently of my right honourable friend. I can tell the noble Lord that, of that £61 million, about two-point-something million pounds has been spent. It will be up to Nissan to make an application for the rest of it, although obviously it will not be needing it at the moment.

Nuclear Power: Future Energy Needs

Lord Wigley Excerpts

Thursday 17th January 2019 Lords Chamber

[Lord Henley]

My noble friend is quite right. That was the tail end of the question from the noble Lord, Lord West; I apologise to the House for not being able to address it in the time that was available to me. I certainly agree that it would be timely to have a debate on this in the light of the recent announcement; I was hoping to be able to repeat the Statement, and perhaps there might be other moments when this could happen. However, obviously that is a matter for the usual channels.

[Lord Wigley (PC)]

My Lords, does the Minister accept that putting Wylfa Newydd on indefinite hold causes economic planning blight in north-west Wales, and the north Wales growth deal is based on the assumption that it is going ahead? Will the Government now raise the level of support allocated to this region?

Nuclear Sector Deal

Lord Wigley Excerpts

Thursday 28th June 2018 Lords Chamber

[Lord Henley]

My Lords, I believe my noble friend is correct, but she will appreciate that I was informed about repeating this Answer only some 15 minutes before the House met. I cannot give precise details about the Trawsfynydd site at this stage, but I will write to her with further details. As I said, I think she is correct.

[Lord Wigley (PC)]

My Lords, as one who worked on the construction of Trawsfynydd in 1963, I welcome the Statement but perhaps I may ask the Minister for some further clarity. First, on the SMR programme, does the fact that the announcement is being made in Trawsfynydd today indicate that the location of an SMR reactor is likely to be Trawsfynydd? Secondly, can he confirm that the lessons experienced over a prolonged period with the decommissioning at Trawsfynydd could be the basis for a study of decommissioning in future? Finally, can he give an assurance that additional money will be available for training and education, particularly for institutions such as Bangor University, to ensure that local people have the skills and take up the jobs?

[Lord Henley]

My Lords, if the noble Lord was working on the site in 1963, it is unlikely that he will be offering himself to work there in any future programme.

Brexit: Competition and State Aid (EUC Report)

Lord Wigley Excerpts

Thursday 24th May 2018 Lords Chamber

[Lord Wigley (PC)]

My Lords, I am glad to have an opportunity to take part in this debate. I do so as a member of the sub-committee, although the report before us today is based on an investigation which had commenced before I joined it late last year. I was happy to put my name to the report, albeit based on the limited information I had gleaned after joining the committee. I thank the noble Lord, Lord Whitty, for the inclusive and helpful way in which he chairs the committee meetings and for his focused introduction to today’s debate. I also pay tribute to the work of the excellent staff who serve that committee.

I want to address briefly just one aspect of the report. That relates to the vexed issue of state aid—as we have heard from many contributors today—and how it bears in the context of devolution, and specifically to the challenges that it poses for the Welsh Government and the National Assembly. I identify with the comments made by the noble Lord, Lord German. We tried to put the JMC on a statutory basis as an amendment to the EU withdrawal Bill, but that was not acceptable to the Government. I have no doubt that we will need to return to that matter.

I shall focus first on the background to this issue. Noble Lords will be aware that the Wales Act 2017 changed the model of devolution regarding which powers are devolved to the Welsh Government and the National Assembly for Wales from a conferred powers model, whereby all the devolved powers were listed, to a reserved powers model more similar to that of Scotland, by which all powers not listed in the Bill are considered devolved.

The powers reserved from Wales to Westminster number in the hundreds, but they do not include state aid. Whitehall departments were widely consulted in this process and were, effectively, given a veto, which inevitably meant that they sought to hold on to every conceivable power they could. Yet they did not specifically hold on to state aid as a reserved matter. So, whether by design or by accident, state aid was deemed by this Act to be a responsibility of the National Assembly.

However, it now transpires that the UK Government wish to extend the number of powers reserved to include such policy fields as food geographical indicators and the subject of today’s debate: state aid. This is the background to accusations from both Edinburgh and Cardiff—of which we have heard already today—of there being effectively a power grab. It has caused immense anger, for reasons I shall outline in a moment.

I turn to the body of the report. It states:

“The UK will have significant decisions to make with regard to future State aid policy … It will be important for the Government to involve, and secure the support of, the devolved administrations in determining the shape of this future State aid regime”.


The report emphasised this particularly forcefully in the context of any decision relating to how the state aid regulatory function should be undertaken. In the event, the Government opted for placing it in the hands of the Competition and Markets Authority, the CMA. The decision appears to have been taken in parallel with our committee’s investigation. That of course is totally understandable given the pressure to get post-Brexit structures into place in good time.

However, our report had recommended specifically, at paragraph 219, that the Government should,

“involve and secure the support of the devolved administrations in this process”—

that is, developing the regulatory framework—

“including in agreeing the terms of reference, remit and priorities of any new UK State aid authority”.

The report further warned of the dangers of the UK Government being perceived to be both rule-maker and rule-taker in this matter.

The Government, in their response of 29 March, glaringly failed to accept this point, merely stating:

“The Government … recognises that the regulation of State aid is a UK-wide issue”.


I ask noble Lords to please note that it does not say that they have the power; they just rest their case on a bland assertion that they “recognise” it. So we have no securing of the support of the devolved Administrations, as recommended by the committee; we have no mutual agreement of the terms of reference; and we have no agreement of the regulatory body’s remit and priorities. The Government have flagrantly ignored the central point of this report in this matter and have not even deemed it worth while explaining why they have done so. It is little wonder that this has caused such acrimony in Cardiff and Edinburgh.

This glaring failure of the Government to respect and involve the devolved Administrations is central to the stand-off that has developed between London, Cardiff and Edinburgh between last December and this month and led to the Scottish Parliament refusing a legislative consent order for the EU withdrawal Bill. This area of controversy is over and above the 24 areas listed where agreement was not forthcoming, and perhaps I should remind the House that the refusal of the LCO by Scotland’s Parliament is supported by Labour and Liberal Democrat MSPs as well as SNP Members. The failure of the Government to recognise the sensitivity of this issue, flying in the face of the committee’s warnings, is what has turned the whole issue sour—quite unnecessarily so. It has been a ham-fisted botch job which will echo for many years to come, and I will explain why.

There are important reasons why powers over state aid should reside in Wales following Brexit. The Welsh Government have responsibility for economic development in Wales; they have subsumed into them the work of the former Welsh Development Agency. The economic damage that leaving the European single market and customs union would do to Wales is potentially tremendous. Export-driven industries, of which we have a high proportion in the manufacturing sector in Wales and on which so many jobs rely, would face serious difficulties if tariff and non-tariff barriers were placed on them. The Tata Steel crisis last year showed that Wales cannot expect Westminster to offer support to our industries in that context; or even facilitate interventions used in other EU steel-producing countries to safeguard their industries. Jobs were eventually saved when the Welsh Government themselves committed to supporting the plant in Port Talbot with a package of support worth tens of millions of pounds, a demonstration that the Welsh Government were in charge of the state aid aspect of their work.

The fundamental truth is that the UK Government’s priorities for state aid are not aligned with the predictable needs of the Welsh economy. State support is used only rarely by the UK Government, in circumstances such as the banking bailout that followed the 2008 financial crash. London’s free market economy model is at variance with the social priorities so highly valued in both Cardiff and Edinburgh. Furthermore, the recent transfer of tax powers to Wales, which will take another step next year when income tax is partly devolved, means that for the first time my country will be responsible for raising some of the money that it spends. It is only morally and politically right that it is allowed to spend this money in ways it deems appropriate, including to use a proportionate state aid vehicle where that is necessary and where it does not unduly distort the UK single market.

I am simply making the point that the priorities of government in Wales and Westminster are different, and therefore it is only common sense that relevant powers should lie with the appropriate Executive. If they do not, every time there is a threat to a strategically important industry in Wales, such as a steelworks, and the Welsh Government are prevented from intervening by the CMA, the whole sorry saga will flare up again. Every time a car or aircraft factory threatens, post Brexit, to move production to a European mainland location and the Welsh Government seek to save the jobs, if the CMA blocks it on the basis of state aid considerations, it is the CMA that will face the political odium.

The Government’s failure to follow or even to acknowledge our committee’s recommendations in this regard will make life totally impossible for the CMA. I wonder whether Ministers warned the CMA chairman of this likelihood when they discussed the matter with him. This culpable failure to think through the issue will stoke up resentment between the devolved Administrations and Westminster—a resentment that could have been avoided—and ultimately could well provide the backdrop to a second Scottish independence referendum. The Government are playing with fire without realising it—in the midst of a post-Brexit powder keg which could blow us all to kingdom come.

In conclusion, I draw to the attention of the House the recently reported survey which is highly relevant to this report and which may make less than comfortable reading for both sides of the Brexit debate. The survey draws on the findings of the Legatum/Populus report of last autumn and shows that while opinion is still closely balanced—depending on the questions asked—on most aspects of the Brexit issue, the one aspect on which there is a clear-cut majority relates to the widely shared hope that Brexit will enable government to intervene to safeguard jobs that are at risk in a way that has been impossible in recent years because of EU state aid regulations.

It is clear by now that the vote to quit the EU, which was particularly high in old industrial areas such as the south Wales valleys and north-east England, was most emphatically not a vote to re-establish a UK single market on the same free market principles as have underpinned the EU single market. This is something Mr Corbyn has clearly understood, and it is a central factor in the Scottish refusal to give the withdrawal Bill legislative consent—and why Mr Corbyn personally backed that stance. It reflects a fundamental refusal to see Brexit as merely replacing Brussels with London and for everything otherwise to continue as was, which is the central tenet of the withdrawal Bill. This all comes into focus with the state aid issue, which Westminster will ignore at its peril.

Swansea Tidal Lagoon: Hendry Review

Lord Wigley Excerpts

Tuesday 1st May 2018 Lords Chamber

[Lord Henley]

I am more than happy to take up the noble Lord’s offer but he has also raised other matters that must be considered.

[Lord Wigley (PC)]

My Lords, what on earth is taking so long with this decision? Is it not an appalling example for business and everybody else that the Government are so slow on this matter? Yes, the cost must be taken into consideration, but it is a matter of taking a decision based on the information. Surely we should be getting on with it.

[Lord Henley]

My Lords, the Government will not be rushed.