UK Infrastructure Bank Bill [Lords]

Abena Oppong-Asare Excerpts

Report stage
Wednesday 1st February 2023 Commons Chamber

[Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)]

I was going to make my points through interventions, but as so few Members want to speak, I thought I would take the opportunity to make a speech. I will speak very briefly to new clause 2 and amendment 5—which stand in the name of the official Opposition, and deal with the need to ensure that the geographical investment is spread across the UK, which is of course is something we all support—and amendment 2, tabled by the right hon. Member for Dundee East (Stewart Hosie), which deals with the constitutional challenges created by these post-Brexit agencies and frameworks. The right hon. Gentleman made his points very eloquently, and I fully support what he said.

In my speech on Second Reading, I highlighted how I thought some of the challenges outlined in these amendments could be dealt with. In my view, that is primarily by ensuring that post-Brexit frameworks and agencies such as the UK Infrastructure Bank have a formal role for the Welsh, Scottish and Northern Ireland Governments within their constitutions and their administration. When I made that speech on Second Reading, the Welsh Government were withholding consent; they have now decided to offer consent because the UK Government have given an element of a concession by outlining that a director of the UK Infrastructure Bank will be responsible for liaising with the Welsh Government—I suppose the same will be true for the Scottish and Northern Irish Governments. That does not go quite as far as I was calling for on Second Reading, when I made the case for the Welsh, Scottish and Northern Irish Governments to be able to appoint their own individual directors.

That concession is a step forward, which I of course welcome. However, the Minister might be aware that the Climate Change, Environment, and Infrastructure Committee in the Senedd, which was responsible for scrutinising the legislative consent mechanism, advised the Welsh Government against awarding legislative consent because of that lack of a formal role—indeed, there was no role whatsoever for the Senedd. I would be grateful if the Minister reflected on my Second Reading speech, where I made the case that it would be very helpful if the UK Infrastructure Bank had to be scrutinised by the relevant Senedd committee, as well as by the Welsh Government.

In conclusion, this really comes down to the Labour party. We expect that it will form the next UK Government; how is it going to Brexit retrofit the UK constitution in light of all these frameworks and agencies that have had to be created since the Brexit referendum, and since we left the European Union and the single market in particular? In Labour’s response to this debate, I very much hope to hear that it is looking at a radical realignment of the British state when it forms the next UK Government, giving the Administrations in Wales, Scotland and Northern Ireland, where appropriate, a formal role in these post-Brexit agencies and frameworks.

[Abena Oppong-Asare (Erith and Thamesmead) (Lab)]

A lost decade of broken Tory promises has left much of the UK with second-rate infrastructure, which is why we support the establishment and the strengthening of the UK Infrastructure Bank and will not be opposing the Bill. The bank is much needed. It will invest in projects that support our net zero targets and contribute to local and regional economic growth. However, we will go further than the Government and harness the full potential of the bank to provide good jobs and opportunities across the country. I will speak to our amendments a little later.

I wish to start by saying how much I welcome the Government’s U-turn in relation to their amendment 1. I see Ministers on the Front Bench who were with us when the Bill was debated in Committee. I am sure that they notice how similar their amendment is to the one that Labour tabled at that stage. Indeed, it is identical to our amendment—an amendment that they voted against. As Labour has repeatedly emphasised, reviews of the bank’s performance will be essential to ensuring that it meets its objectives to invest in the industries of the future. It was shocking that the Government wanted an initial review in 10 years with subsequent reviews every five years. The bank needs momentum and drive behind it, and I am glad to see that the Government have now realised the error of their thinking and committed to reviews of the bank every five years.

[Richard Fuller]

I commend the hon. Lady for holding the Government to account on this particular issue of the review period. This is where we are setting the bank free to go on its mission. As she and I agree—I think we agree—the initial few years are really very important. I notice that the Minister has restricted to five years subsequent assessments, as both the hon. Lady and I thought would be wise, but there is still that initial seven years. She did not table an amendment on that, so I wondered what the Opposition’s thinking was on that initial period?

[Abena Oppong-Asare]

I am grateful to the hon. Gentleman for his comments. He might remember that we tabled amendments in Committee and again on Report on that issue, but because the Government announced a U-turn, we decided to withdraw our amendment.

Yesterday’s dreadful IMF forecast makes it very clear that Britain has so much potential but that the Conservative Government are holding us back. The UK is the only G7 country forecast to see negative economic growth. Let us look at the Government’s record on infrastructure: a green homes scheme closed just six months after its introduction, with a £1 billion cut from its budget; an energy system that sees fossil fuel companies making record profits while hard-working people’s bills soar; and just a fortnight ago, a crucial gigafactory, Britishvolt, went into administration, leaving the future of the British electric vehicle market in jeopardy. According to the Government, the purpose of the UK Infrastructure Bank is to provide access to money, particularly where there is an undersupply of private financing. Britishvolt, a UK battery start-up, was expected to support new jobs and green technology with a factory in Blyth. Now it is being sold by administrators, with the Government seemingly abandoning their promises of levelling up and supporting a green economy.

Just this week, the British electric van start-up “Arrival” announced that it is cutting 800 jobs, as it moves for extra funding and green subsidies in the US. Hon. Members will not be surprised to hear that Labour has no faith in the Government harnessing the potential of the UK Infrastructure Bank to invest in the high-skilled jobs of the future. A Labour Government will use our green prosperity fund to invest in wind, solar and nuclear energy; insulate 19 million homes; grow our economy; and get Britain winning the race to net zero. We have tabled new clause 2 and amendment 5 to ensure that the UK Infrastructure Bank can play its role in this mission. New clause 2 would require the bank to publish an annual report setting out the geographical spread and the ownership of businesses and bodies that it invests in. It would also require the bank to publish a good jobs plan for every project it invests in, to ensure that the project will improve productivity, pay, jobs and living standards.

[Samantha Dixon (City of Chester) (Lab)]

Does my hon. Friend agree that by failing to commit to Northern Powerhouse Rail, the Government have failed on their levelling-up promises to the north? Would she, along with me and other Members who have expressed opinions earlier in the debate, suggest that the Minister needs to offer the House some assurances that the UK Infrastructure Bank will distribute its benefit to every part of the country, with the geographical spread she just mentioned?

[Abena Oppong-Asare]

My hon. Friend makes strong points about what the Government should be doing, and I hope the Minister takes them on board. We have all seen the allegations of favouritism that have beset the Government’s levelling-up funding, with nothing in the Bill to guarantee that the bank will distribute its funds to the areas that need them the most. Our new clause would ensure scrutiny and transparency over bank investments. Given the Prime Minister’s now famous boast—I quote it in case Members have forgotten—about reversing Treasury formulas that

“shoved all the funding into deprived…areas”,

I hope the Minister can see why we think transparency is necessary. His party, after all, is the party responsible for the loss of £6.7 billion to fraud and mismanagement.

I hope, too, that the Minister is paying attention right now and agrees that we want the UK Infrastructure Bank to create high-skilled, well-paid jobs. With a good jobs plan for every project that it invests in, we can ensure value for taxpayers’ money. That approach has been taken with previous significant infrastructure projects in the UK. For example, the Olympic Delivery Authority worked with trade unions and others to ensure that the project delivered good quality local jobs, and a similar approach was taken with High Speed 2. If the Government are as committed to their levelling-up agenda as they claim to be, I am sure that they will vote for our new clause today.

Amendment 5 would strengthen the bank’s objectives. It would make it clear that the bank’s target of boosting regional and local economic growth includes reducing economic inequalities within and between regions in the UK. Despite the Government’s assurances to the contrary, the Bill contains only a watered-down commitment that could result in the bank’s resources being poorly targeted and ineffective.

We want a further objective for the bank to contribute to the UK’s supply chain resilience and industrial strategy. I have mentioned the collapse of Britishvolt and the warnings of green investment moving abroad. Those are serious concerns. The importance of supply chain resilience has become particularly clear in the wake of the pandemic and as concerns over energy security have come to the fore with the war in Ukraine. We want the benefits of the UK Infrastructure Bank to be seen here in the UK, with home-grown renewables such as offshore wind, solar, nuclear, hydrogen and tidal power.

[Richard Fuller]

The hon. Lady is being generous in giving way, and I am grateful to her. I want to probe her thoughts a little further on amendment 5. The Bill, as I have said, has the benefit of being quite precise in its current objectives. As parliamentarians, we know that when we take something from statute and leave it to regulators, the House’s ability to hold them to account in the public interest is somewhat weakened. Does she accept that additional objectives would give an Executive a lot more discretion to say, “I didn’t achieve that because I was focusing on this objective”? We have created some primary objectives about climate change and so on. Adding others would leave us somehow disempowered, because those Executives could move and shake around where they said their priorities were. As I said earlier, I am concerned about the balance between laudable objectives and ensuring that, when we have put the Bill into statute, we parliamentarians retain the ability to control what is actually happening on the ground in one, two, three, four and five years from now.

[Abena Oppong-Asare]

I thank the hon. Gentleman for his comments—as I say, I always like to take them on board—but I fundamentally disagree with him, because our amendment would ensure that we take the Bill further. As he once said, the best way to promote UK manufacturing jobs and production is to

“shape regulation to support enterprise.”—[Official Report, 16 November 2021; Vol. 703, c. 438.]

That is exactly what Labour seeks to do with our amendments, so I really hope he will support them. I understand where he is coming from, but our amendments would make sure that we deliver the projects that we need in the UK.

We know that the UK Infrastructure Bank could be a national enterprise. We have a world-leading offshore wind industry in Scotland and on the east coast, hydrogen in the north-west and on Teesside, nuclear power in the south-east, and solar power in the south and the midlands, but the potential of these industries can be realised only if investment stays in the UK. The amendments we have tabled would allow that to happen. The lack of domestic champions has compromised our security and stalled progress, and our amendments would enable the UK Infrastructure Bank to help reverse the trend.

I will speak briefly to the other amendments we are considering today. Labour strongly supported the circular economy and nature-based solutions being on the face of the Bill, and we were disappointed to see the Government remove them, but we are clear that amendment 4 has not been properly thought through. Nothing in it would do anything to improve water company performance or reduce sewage dumping; on the contrary, it would give water companies an excuse to not undertake the necessary improvement works. We will therefore not support it. Labour has set out a clear plan to end the Tory sewage scandal by introducing mandatory monitoring with automatic fines, ensuring that regulators properly enforce the rules, and holding water bosses personally accountable for sewage pollution.

[Selaine Saxby (North Devon) (Con)]

Does the hon. Lady not agree, having been in the Chamber earlier today, that the Government are already monitoring storm overflows across the country? One of the reasons why we are aware of the size of the problem that we are trying to tackle is because we have increased the monitoring from only 6% a few years ago to nearly 100% now.

[Abena Oppong-Asare]

I am not going to take any advice from the Government. They have been in government for 13 years, and what have they delivered so far? I suggest that the hon. Lady support our amendment, which would ensure that things go through properly.

The devolved Administrations must be included in the development of the UK Infrastructure Bank. I have already mentioned the fantastic wind energy sector that we have in Scotland, and I was excited to read about the opportunities that the bank has identified in Northern Ireland. We do not believe that amendment 2 is necessary to ensure that all regions and nations of the UK benefit from the Bill, so we will not support it.

As we enter another year of low growth and failed Conservative government, we know there is a vital need to invest in the infrastructure of the future. We support the establishment of the UK Infrastructure Bank and have sought to improve the Bill throughout. We want to see stronger objectives and reporting for the bank, so that it can play a role in meeting our net zero targets while creating good jobs across the country and supporting the UK supply chain’s resilience, but what the bank needs most of all from the Government is an ambitious plan. Once again, the Government are on the back foot and U-turning at the last minute with amendment 1, on the bank’s reviews. It is yet another sign that Labour is the party with a plan for government—a party that will grow the economy and create jobs for the future.

[The Economic Secretary to the Treasury (Andrew Griffith)]

It is always a pleasure to follow the hon. Member for Erith and Thamesmead (Abena Oppong-Asare). I thank all hon. Members who have tabled amendments and contributed to today’s debate, as well as those who made valued contributions in Committee. Notwithstanding a certain number of amendments, I feel that generally there is good consensus across the House about the core purpose and objective of an important institution.

If we are fully to meet our responsibilities to spread opportunity to all parts of the United Kingdom and support the all-important transition to the clean energy economy, it is right that we take bold action now with institutions such as the UK Infrastructure Bank. We have therefore introduced the Bill to make explicit—with a legislative lock, if you like—the scope of the bank’s objectives

“to support regional and local economic growth”

and

“to help tackle climate change”.

Enshrining the bank in legislation will help to establish it as a long-lasting institution. That is important to colleagues across the House, as we have heard, who agree that it is a welcome initiative. I am glad that there has been general consensus today about the importance of the Bill.

I turn to Government amendment 1, which stands in my name. In Committee, I committed to looking again at the frequency of statutory reviews into the UK Infrastructure Bank and undertook potentially to propose a different frequency at a later stage of the Bill’s passage. It would be a gross mischaracterisation to call the amendment a U-turn; it is simply an example of a listening Minister in a listening Government trying to do what is best to get the institution on the right footing. I thank hon. Members who brought the matter to my attention and shared their views, particularly my predecessor, my hon. Friend the Member for North East Bedfordshire (Richard Fuller), who raised the point in Committee.

It is, I hope, a sign of strength that I considered afresh what was appropriate for the first review period. However, given the pre-existing reviews to which the Cabinet Office and HM Treasury have already committed, and the need to allow a nascent institution time to embed itself, I remain of the view—having taken the question away and looked at it again—that it is right for the first review period to be seven years. However, I recognise the strength of the arguments for, the appropriateness of and the desire for a shorter period between every subsequent review to ensure that this House applies the necessary accountability. My amendment 1 would therefore reduce the interval between each regular review after the first.

[Abena Oppong-Asare]

Does the Minister remember rejecting our amendment about the reviews? He is saying that this is not a U-turn, so I just want to hear from him about that aspect.

[Andrew Griffith]

I hope the hon. Lady would never dream of trying to score cheap political points, as distinct from our good-natured and collaborative discussions in Committee. Rather than setting a new timeframe there and then, we looked at precedent in a quest for the optimal timeframe. I undertook to come back on Report and share a proposal with the House, precisely as I am doing today. Having listened and having made that determination, I can feel the warm radiation of support from the Opposition. I hope to see that good will extending to supporting the rest of the Bill without further amendment.