The Space Economy (UK Engagement with Space Committee Report)

Lord Willetts Excerpts

Thursday 9th July 2026 Lords Chamber

[Lord Willetts (Con)]

My Lords, I congratulate the committee on an excellent report, which is a magisterial review of the issues in space policy that also brings out the opportunities for us. I declare an interest as chair of SaxaVord spaceport, which has already been referred to. Before that, as chair of the UK Space Agency, I gave evidence to the committee about the agency.

My history here is that, when I arrived as a Minister in 2010, space was one of my responsibilities and I inherited plans from the previous Labour Government—from the excellent noble Lord, Lord Drayson—to create a new UK space agency as an arm’s-length body. So the plans were from the previous Labour Government and I implemented them. In my final year as chair of the UK Space Agency, I loyally implemented the new Labour Government’s plans to get rid of it as an arm’s-length body. Those are the ups and downs of politics, of course, as many in this House are aware.

In the interim, a decision happened several years ago to split policy in the department from operations in the agency. That model was not working. It is absolutely right to bring together policy and operations. If that is inside DSIT, with its broader links to other departments, so be it, and I wish all success to the new Space Agency, once again bringing all those roles together. But I hope the Minister will be able to assure the House that real, deep technological expertise within the Space Agency will be preserved, even within the Whitehall department.

A key theme of the report is the excellent opportunities we have, and I certainly regard launch as one of them. SaxaVord is the UK’s great opportunity to have a vertical launch capability, and it has already received support from the Government. One of the themes of this report is the many different ways government can support the space sector, and one of these is procurement. So if, for example, the Government financially back launch and launch companies in the UK, will they also encourage them to launch their rockets from SaxaVord? Similarly, if the MoD is planning the launch of satellites, will it be encouraged to consider SaxaVord as a launch option?

It is striking how at SaxaVord, the main military interest in using us comes from Germany. The Kensington treaty, linking Britain and Germany, means there is now significant interest from the German military in using SaxaVord to launch the large commitments to new satellite constellations that they have made. It would be great if that were matched with some interest from our MoD.

The German interest in SaxaVord has to be looked at against the backdrop of the EU Space Act, which is briefly referred to in the report and presents an increasingly tricky challenge for the UK’s space sector. It is pretty protectionist about EU companies and provision. But the irony when it comes to launch is that mainland EU is “spacelocked”: there is no viable space launch capability within the mainland of the EU. Europe’s two vertical launch options are at SaxaVord in Scotland, and at Andøya in Norway, which is in the European Economic Area. So, I hope the Minister can assure the House that she will do her best to ensure in conversations and negotiations with the EU that the EU Space Act is not a protectionist barrier to British space companies or launch from the UK.

The report rightly brings out the importance of promoting investment in space. That brings us to another important initiative: the rise of the public finance institutions—the so-called PuFins—the National Wealth Fund and the British Business Bank, which are a really important tool for promoting co-investment and bringing together private and public finance. Again, they are referred to in the excellent report. However, the word in the space sector is that the National Wealth Fund has decided that it will not invest in space, despite space being identified as one of the priorities in the industrial strategy. I hope the Minister can assure the House that the National Wealth Fund will consider investing in space, and that space companies with suitable propositions should be able to bring them to the NWF, as well as the British Business Bank.

Finally, having advocated the Government taking their stake in OneWeb, one of my most frustrating experiences has been observing the ways in which, sadly, that opportunity was not taken in the way it could have been. It is now part of Eutelsat. It is striking how, as Eutelsat decides to commission satellites, they are not being built in the UK, and as it decides where to launch them, that is not happening from the UK either. It is not too late to use OneWeb in the way we originally envisaged, as a strategic opportunity for us to advance our interests in space.

I congratulate the committee on its excellent report and look forward to the ministerial response.