Space Industry Bill [HL]

Debate between Lord Willetts and Lord Fox

Committee: 1st sitting (Hansard): House of Lords
Monday 16th October 2017 Lords Chamber

[Lord Fox]

My Lords, I apologise to the noble Lord, Lord Tunnicliffe, for missing the first couple of words of his contribution and to the Committee for being slightly detained outside the Chamber.

Very briefly, the mission of these amendments, in the event that they were adopted by the Government, appears to be to create unlimited liability for the companies concerned in the pursuit of their business. Having asked a few questions of such operators, my understanding is that were they in an environment of that nature, the whole spirit of the Bill would be lost very quickly, in that no operator would undertake a risk of that level. I understand the concerns of the mover of this amendment, and the questions he has asked of the Government—who would pick up the liability?—are the right ones. However, the solution of creating unlimited liability across the board for the operator is not one that these Benches would support.

[Lord Willetts]

My Lords, I will comment briefly on this set of amendments. The noble Lord, Lord Fox, has put the point very vividly. This gets to the heart of the economics of the space industry.

There are risks in space, as we have heard in the past hour in which we have been debating. First, probably the greatest risks are at launch. Not all launches are successful, which is why, by and large, launch facilities aim to launch rockets out over the ocean. I am sure that will be a relevant consideration when the rival claims of different locations, especially for vertical launch, are considered. I have to say that Prestwick is very fortunate to have my noble friend Lord Moynihan—if only every possible spaceport candidate had a similarly assiduous Member of this House to make its case.

Secondly, there is some risk in orbit of satellites colliding and doing damage, or one person’s identified satellite taking out someone else’s satellite. That is rare but it does happen. Thirdly, there is the very remote possibility, but it can happen, that a satellite falls out of orbit. In those circumstances they mostly burn up and it is a managed process, but a bit could reach the ground and do damage.

These are, thank heavens, all very remote risks. However, if the worst conceivable thing happened—if a satellite came out of orbit and did not burn up in the atmosphere and landed in the middle of a busy conurbation—serious damage would be done. These remote but potentially large risks are very hard to insure. Therefore, many of the countries that ultimately take responsibility as launch nations for satellites provide some kind of cap on the liability that a private launch operator would face. I very much welcome, therefore, the conception behind Clause 11: that the Government intend that an operator licence may specify a limit on the amount of the licensee’s liability.

There are complicated arguments behind this. I can report from my own time as a Minister that I was regularly asked by the industry whether it would not be possible to reduce the maximum liability operators would face, and I was regularly pressed by the Treasury that the liability that the operators faced should be as large as possible. I suspect that those arguments carry on to this day and will never be finally concluded.