Strikes (Minimum Service Levels) Bill

Alan Brown Excerpts

Committee stage
Monday 30th January 2023 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kevin Hollinrake)]

It is a pleasure to serve under your chairmanship, Mr Evans.

It is well known that the first and foremost job of any Government is to keep the public safe. Every one of us in this Chamber will know of people who have been impacted by industrial action. Every one of us will know constituents who work hard and expect access to essential and life-saving services when they need them. It is clear that that is not happening in all cases. That is why this Government are taking proportionate and sensible steps through the Bill. Our position, which has the support of the majority of our constituents—in a recent YouGov poll, 56% of those polled said that they support the legislation—is that we need to maintain a reasonable balance between the ability of workers to strike and the ability to keep the lives and livelihoods of the British public safe.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

The Minister has started with a red herring about keeping people safe. Can he explain, then, why teachers and education are included in the Bill?

[Kevin Hollinrake]

Clearly, there is a wider context for children. It is about services and safety—those are both contexts in this—as well as livelihoods. All those things are affected when people do not provide a minimum service level.

--- Later in debate ---

[Mr Rees-Mogg]

I am grateful to the right hon. Gentleman, but I think that he attributes to me more influence than I have. My fusillade against clause 3 will not change many votes this evening—including my own, as it happens. Therefore, it will not be the case that the Government will be defeated in the Committee. I think that I went quite a long way in saying that the right hon. Member for Ashton-under-Lyne was not wrong on amendment 101; I thought that was pretty generous. However, the right hon. Gentleman is a hard man—he is known as a hard man of the left, and he is a hard man of parliamentary procedure as well.

[Alan Brown]

It is quite impressive that, despite the right hon. Member having been on his feet for 16 minutes telling us how bad the Bill is, he has not convinced himself to vote against it. Is it not the case that he was quite happy to have Henry VIII powers when he was Secretary of State for Business, Energy and Industrial Strategy, but, now that he is a Back Bencher, he is against them and back to respecting parliamentary sovereignty?

[Mr Rees-Mogg]

I am afraid that the hon. Gentleman is completely wrong about that. In all the legislation that I was involved with, I pushed against Henry VIII powers on every single occasion and always asked why they were necessary—I merely could not make that particularly public. There is a place for Henry VIII powers—they are not all bad—but those in the Bill go much too far. If he looks at the evidence that I gave from those House of Lords reports, he will see that it was on exactly those lines.

--- Later in debate ---

[Mr Rees-Mogg]

I should love to give way to the hon. Gentleman, but lots of people want to speak and I have gone on for too long.

[Alan Brown]

It is a pleasure to follow the right hon. Member for North East Somerset (Mr Rees-Mogg)—certainly now that he has found his Back-Bench voice again—but it is disappointing that he is still in favour of the Bill even though he says how badly drafted it is. We know how bad a Bill’s concept and drafting are when something like 120 amendments are tabled, spanning 53 pages, yet the Bill itself has only six clauses over seven pages.

I thank my hon. Friend the Member for Glasgow South West (Chris Stephens), who is responsible for about a quarter of the entire amendment paper. I am disappointed to see that there is not a single Tory amendment, nor a single Tory MP backing any of the amendments despite how many there are. It is good to hear some critical voices, however, and I hope that at the very least the Minister will listen to the Tory Back-Bench voices telling us how unconstitutional the Bill’s drafting is and the dangers that it will bring.

With only five hours to debate amendments, as my hon. Friend the Member for Glasgow East (David Linden) said, it is clear that the Government are intent on ramming the Bill through with minimum scrutiny but maximum politics as part of the Tory culture war—a culture war that they are now taking to something like 7 million key workers. I hope they get their just reward at the next election from those 7 million voters. Considering that the Tory party accumulated only 14 million votes at the last election, those 7 million key voters could be critical up and down Great Britain.

The Bill is so offensive that there is a moral dilemma involved in tabling amendments to it. How can we improve a Bill that we so fundamentally oppose? For that reason, we tabled amendments to delete each clause. As I have said before, the Under-Secretary of State for Scotland, the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont), has described the Bill at the Dispatch Box as “anti-strike legislation”. Our amendment 33, which was not selected, would have changed its title to “Anti-Strikes (Forced Working) Bill”, which would have been quite apt.

The Bill presents opportunities for employers to pick on specific individuals and name them as required to break a strike. If those individuals do not comply, they face the ultimate sanction of sacking. Those proposals are not replicated internationally, even in places where, as the Government like to remind us, there is some form of minimum service legislation. The threat of sacking for going on strike is absolutely outrageous, so I certainly support Opposition amendment 1. Although the Minister says that the Bill could not lead to sacking, the overview in the explanatory notes makes it clear that it will remove protections from unfair dismissal for going on strike. That is the key aim of the Bill, as set out in the overview given in the explanatory notes, so the Minister cannot say that the Bill will not lead to the sacking of key workers.

[Chris Stephens]

My hon. Friend makes a valid point. The Minister keeps shaking his head whenever someone mentions dismissal, but it is clearly there in the Bill. The Bill says that someone who is sacked will have no right to an industrial tribunal. The very real concern for many of us is that trade union officials and activists will be the ones who are picked on. They will be dismissed and will not have the right to a tribunal.

[Alan Brown]

I will return to that point, but it is quite clear that the Bill allows individuals to be named. If someone is deemed to be part of an awkward squad, or to be a trade unionist the company wants rid of, they can be named. If they do not break a strike, they could be sacked.

A common theme on the amendment paper is the attempt to control and limit the definition of “minimum service” and ensure that it relates to service required for genuinely critical health and safety-related matters. I support such amendments, although we know that there is existing legislation that covers life and limb protection anyway. In a similar vein, there are attempts to limit unilateral impositions by the Government. There are also several new clauses and amendments that relate to consultation, voluntary agreements, compliance with international obligations and the implementation of an arbitration process. If the Government had any intention of collegiate working, we would not have to debate the inclusion of such measures.

Another theme—I am glad that the right hon. Member for North East Somerset brought it up—is parliamentary sovereignty and the need to prevent too much control from lying with the UK Government. Those are issues that should exercise Tory Back Benchers.

I support all amendments that would eliminate the retrospective effect of the Bill and stop it applying to strikes that have already been balloted for. The Bill is bad enough, but to apply it retrospectively to attack strikes that have already been properly balloted for, under the existing rules and the existing draconian legislation, is just bizarre.

The SNP has tabled amendments that would protect devolution and require approval from devolved Governments and other bodies on devolved matters before implementation. If Scotland were indeed an equal partner, the UK Government would not have a problem with such requirements, but we know that their attitude is “Westminster knows best”, even though it is Westminster that is wrecking inter-Government relations. It is now Westminster that is looking to wreck relationships with key workers, including in the devolved nations.

Our amendment 27 is an attempt to eliminate the ridiculous proposal that secondary legislation could be used to “amend, repeal or revoke” any previous legislation already passed by Parliament or any future legislation in this Session. SNP amendment 28 further makes it clear that such Henry VIII powers should not extend to devolved legislation. It might be acceptable for most of the Tories to allow their Government unparalleled powers over past and future legislation, but it is simply not acceptable to us that Westminster could have carte blanche to rip up devolved legislation that has already been passed. I welcome the similar amendments tabled by the hon. Member for Cynon Valley (Beth Winter) to protect the devolved institutions; I hope that Labour Front Benchers too will see the need to stand up and protect devolution.

I also support the hon. Member’s amendments 98 and 77. They mirror our amendments 30, 36, 37 and 38, which would amend clause 4 and the schedule to ensure that the Bill will not apply to Scotland. New clause 2 spells it out: the Bill should

“not apply to disputes which take place in…Scotland or Wales”,

no matter where the workers reside. If the Tories really want this Bill, I suggest that they own it and justify it to the nurses, ambulance drivers and train workers in their constituencies—but do not think about imposing it on Scotland and Wales, whose Governments do not want it.

Our amendments are intended to prevent imposition from Westminster, but the blunt reality is that unless employment law is devolved to Scotland, the Bill—clause 3 in particular—will allow Westminster to interfere and impose as it sees fit. We are now seeing Westminster confirming autocratic powers.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

My hon. Friend mentions the devolution of employment law. As far as I am aware, the Smith commission undertook to decide whether it should be devolved. Does my hon. Friend know which party blocked that from coming to Scotland?

[Alan Brown]

I think that was a rhetorical question. It was, unfortunately, Labour that led the charge against devolving employment law. Interestingly, the Scottish Trades Union Congress has made it clear that it supports devolving employment law to Scotland, so I urge the Labour party to reconsider its approach.

[David Linden]

I missed what my hon. Friend said. Did he say which party blocked the devolution of employment law?

[Alan Brown]

Just for the record, unfortunately it was the Labour party that blocked the concept of devolving employment law to Scotland—although, to be fair, it was also the Labour party that devolved employment law to Northern Ireland. If it is good enough for Northern Ireland, it should be good enough for Scotland.

[Amy Callaghan (East Dunbartonshire) (SNP)]

Just one more time, for the record, will my hon. Friend confirm which party prevented employment law from being devolved to Scotland?

[Alan Brown]

Again, just for the record—I thought I was speaking quite loudly, but just in case Members did not hear what I said—it was indeed the Labour party that blocked employment law from being devolved to Scotland. Hopefully the Labour party will reconsider, now that that is on the record.

--- Later in debate ---

[Alan Brown]

As we have heard, the Government still have not listened, because they would not accept any amendments. The Secretary of State rehashed some of the old arguments: he said the Bill was about health and safety, but he then used the example of teachers. Teachers are not childminders—they are there to provide education —but he is using them as an excuse to allow other people to get to work. He talked about protecting ordinary workers, but what about rewarding the ordinary key workers who are providing vital services, instead of waging a culture war on them?

The Government have not listened to the fact that the ILO does not actually back their legislation. They have ignored the fact that European trade unionists have stated that the UK already has the most draconian strike legislation. They refused to acknowledge the point of my hon. and learned Friend the Member for Edinburgh South West (Joanna Cherry) that the only other countries in Europe that allow Governments to stipulate minimum service levels and penalise workers by sacking them for not complying are Russia and Hungary. That is the company that the UK Government are looking to keep.

The Government try to tell us that workers such as nurses cannot get sacked, but the explanatory notes say clearly in their overview of the Bill that it will

“restrict the protection of trade unions under the 1992 Act from legal action in respect of strikes relating to certain services and the automatic protection of employees from unfair dismissal”.

That makes it clear that workers can get sacked if they do not comply with the work notices when they are told to work, even if they do not want to and they want to adhere to the strike.

The Government also have not listened to the right hon. Member for North East Somerset (Mr Rees-Mogg), who pointed out how badly written the Bill is and the unlimited powers that it gives to the Government. I note that he is suddenly in favour of the Lords amending legislation, which is a change in tune from recent years, when he was against that. It shows how bad things are when, yet again, we are relying on the unelected Lords to amend the Bill.

[Mr Rees-Mogg]

I am grateful to the hon. Gentleman for giving way. I am in favour of their lordships doing their proper job, which is revising legislation to make this legislation, which is very good, perfect—that is what they are there for.

[Alan Brown]

The right hon. Gentleman did not say that when it came to the European Union (Withdrawal) Act 2018 during Brexit.

The Bill allows individual workers and trade unions to be targeted. It is an assault on the devolution settlement. Employment law should have been devolved to the Scottish Parliament but, as I said earlier, Labour opposed it being devolved. Even worse, the powers in the Bill allow the UK Government to amend devolved legislation, which is an assault on the devolved nations. I am disappointed that Labour did not back the SNP amendment, which would also have protected the Welsh Government. I do not know why Labour sat on its hands about that.

The Bill is an assault on devolution, an assault on workers and an assault on trade unions. That is why we oppose it and why we need independence to get away from this institution.

Oral Answers to Questions

Alan Brown Excerpts

Tuesday 17th January 2023 Commons Chamber

[Mr Speaker]

I call the Scottish National party spokesperson.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

For a real energy mix we need dispatchable energy such as pumped storage hydro, and in Scotland we have such schemes ready to go, including Coire Glas, Cruachan and Red John, which between them could generate 2.5 GW of power—almost the same as a new power station but at a fraction of the cost. In the BEIS Committee, the Secretary of State told me that he had met representatives of SSE to discuss Coire Glas—a meeting so memorable that SSE does not seem to know anything about it. When are this Government going to get a grip and meet the industry to agree a route to market for pumped storage hydro?

[Ms Ghani]

I think the hon. Member is incorrect. I believe that the Secretary of State did indeed hold that meeting. What I find extraordinary is that the hon. Member will look at the energy mix but exclude nuclear, for example. We need to have everything in our energy mix, and the work that we are doing in the UK has shown that we are going on the right path. Our low carbon electricity sources such as solar, wind, and hydrogen, alongside nuclear, generated over 50% of the UK’s energy last year in February, May, October, November, and December, I believe, so we do have a path forward.

[Alan Brown]

The reality about nuclear is that there is not one successful evolutionary power reactor—EPR—project in the world. Hinckley is a disaster and Sizewell C will not happen in time, if it happens at all. On the energy mix, the UK Government’s inaction has blocked pumped storage hydro, onshore wind was blocked for years in Scotland and we have had the rug pulled from under the feet of the Peterhead carbon capture project three times now. When will this Government finally support and give the go-ahead for the Acorn cluster, which is vital for reducing emissions in Scotland and the UK? Is not this cap-in-hand approach proof that Scotland has energy but not the power?

[Mr Speaker]

Order. The Minister must let the hon. Gentleman finish before she goes to the Dispatch Box. I cannot have both of you on your feet at the same time.

Strikes (Minimum Service Levels) Bill

Alan Brown Excerpts

2nd reading
Monday 16th January 2023 Commons Chamber

[Grant Shapps]

I am surprised by how the hon. Gentleman, who normally speaks a lot of sense in the House, put his point across. Yes, of course it is the case that the NHS has been under unbelievable stress, not least because of two years of covid and all the backlog that has been created. It is worth reminding Labour Members that, had they had their way, we would have been in lockdown for a heck of a lot longer and those cases would have been even worse. I do not follow the logic of his argument. He seems to be arguing that just because there are times of danger, we ought, by design, to enable a system that prevents unions in the ambulance service from telling the NHS when ambulances will be there and what the minimum service would be. That is the issue that we seek to address today.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

If this is all about safety, why is the word “safety” not used once in the Bill or its explanatory notes?

[Grant Shapps]

It is fairly obvious to say that a minimum service level in railways, for example, is about people’s livelihoods rather than safety, but that the NHS and the ambulance service not agreeing nationally is a minimum safety level issue. I would have thought that was pretty straightforward.

--- Later in debate ---

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

The right hon. Member for Witham (Priti Patel) said that this was a partisan debate. Of course it is a partisan debate, because we either believe in the right of workers to strike or we do not, so, clearly, it is a partisan debate. She spoke about SMEs struggling because of strikes. I can tell her that SMEs in my constituency are more worried about their energy bills going through the roof and the lack of Government support that is coming down the line from April onwards.

We know that this is “anti-strike legislation”—those are not my words, but the words of the Parliamentary Under-Secretary of State for Scotland from the Dispatch Box last week at Scotland questions. He boasted that his Government were introducing “anti-strike” legislation in a rare bit of honesty from the Dispatch Box.

The Secretary of State for Business, Energy and Industrial Strategy keeps going on about minimum ambulance cover, but the reality is that this is an attack on millions of public sector workers. The explanatory notes tell us that this is a Tory manifesto commitment about tackling transport strikes. Although the Conservatives might hide behind that manifesto commitment, that commitment has nothing to do with clamping down on the NHS or on teachers. The Conservatives claim that it is about safety, but, as I said earlier, the word “safety” is not used once in the Bill or in explanatory notes. The reality is that this is an ideological war on the unions, which the Tories somehow think will curry favour with the public. It is a misty-eyed look back to Margaret Thatcher taking on the National Union of Mineworkers. It was a battle that she won, but it was a battle that resulted in the closures of mines and left communities devasted and thousands of workers on the dole. Do we really want to go back to sacking workers and putting them on the dole? That is what this is all about.

We know that this is an ideological war, because, in this period of Tory governance, the Government have already given us the Trade Union Act 2016, introducing voting thresholds, and then, last year, the legislation to allow employers to hire agency staff to break strikes. There is no doubt that this Government want to end strikes, effectively removing the ultimate backstop on collective bargaining.

The Bill not only facilitates an attack on workers, but enables employers to potentially sue unions for damages. It is no wonder that it is opposed by the TUC, the Scottish Trades Union Congress, Unison, the British Medical Association and the Royal College of Nursing among others, and I certainly support them in opposing this.

The legislation is nothing more than an attack on democracy—an attack on the rights of workers to withdraw their labour, and a further attack on devolution. Neither the Scottish Government nor the Welsh Government want this legislation, but, yet again, this legislation will be imposed on the devolved nations. In Scotland, this is further proof that the Westminster straitjacket does us no good at all. We could have had employment and workers’ rights devolved, but, unfortunately, Labour resisted those powers coming to Scotland. However, even the STUC has now called for the devolution of employment rights to Scotland, so perhaps Labour should consider that, instead of listening to Gordon Brown’s rehash of broken promises.

It is worth noting that the Bill does not impact Northern Ireland, as employment law is already devolved to the Northern Ireland Assembly, so, yet again, the so-called most powerful devolved Parliament in the world—the Scottish Parliament—has fewer powers than the Northern Ireland Assembly, and this proves it.

This ideological attack comes from someone who, as Transport Secretary, was non-existent when it came to dialogue and communications, and that was confirmed by the unions. He was somebody who was blocking the DFT from agreeing deals, and now we have that same person in post leading the charge for anti-strike and anti-worker legislation. Given the Secretary of State’s form, we know that he is up for a fight, but even if wins this fight, he will be destroying worker relationships for good. These are hard-pressed workers, particularly from within the NHS, who are struggling at times with the pressures that they are under. Who seriously thinks that not negotiating and threatening workers with the sack for striking will help matters? It is utterly insane. As the rail unions pointed out at the Transport Committee last week, deals have been agreed where DfT and UK Ministers are not involved. Clearly the union asks cannot be too unreasonable, when RMT and ASLEF have agreed deals with ScotRail and the Scottish Government, deals in Wales and deals with Merseyrail, for example—deals with Governments and authorities that have been hamstrung by the Tory austerity imposed on them, yet still managed to agree deals.

The Tories tell us they are the party of workers. That phrase fools no one, but they also tell us they are all about a high-wage, skilled economy. Yet, as we have heard, when workers ask for a wage rise they are told no, that it is unaffordable; even worse, in the case of the rail unions, the Secretary of State quotes figures that he thinks show how well paid all rail staff are. That is really telling: the Secretary of State is effectively saying, “Train drivers are overpaid—how dare they ask for a wage rise?”. That is insulting beyond belief.

The Tories can forget saying they want a high-wage economy. They were quite happy for the rail companies to pay dividends during the pandemic. They were quite happy for Virgin Trains East Coast to walk away from the London North Eastern Railway franchise owing billions of pounds, but they always go for attacking workers.

It is the same with the Secretary’s rhetoric about this legislation mirroring what happens elsewhere in Europe. His soundbites are easily proven to be false. Indeed, the general secretary of the European Federation of Public Service Unions, Jan Willem Goudriaan, argued that comparison by the UK Government of this Bill with existing laws in other EU countries was misrepresenting the situation, because all minimum service levels in Europe are agreed through negotiation. Moreover, the general secretary of the European Trade Union Confederation, Esther Lynch, said:

“The UK already has among the most draconian restrictions on the right to strike in Europe, and the UK government’s plans would push it even further away from normal, democratic practice across Europe”.

Pablo Sánchez Centellas, a spokesperson for the EPSU, was much more succinct, saying, “It’s bollocks.” The Secretary of State should reflect on the true position of this proposed legislation compared with what is happening in Europe.

It also seems that this legislation is in breach of article 11 of the European convention on human rights, especially with regard to proportionate action. Richard Arthur, head of trade union law at Thompsons Solicitors, said the Bill raised,

“very serious legal question marks”,

and anticipates legal challenges under article 11 of the ECHR and convention 87 of the International Labour Organisation. He has also rightly pointed out that the human rights memorandum that accompanied the Transport Strikes (Minimum Service Levels) Bill set out reasons why minimum service levels were not justified in fire services, health settings or education, yet that is what the Government now propose. By default, this Government are now going against their own previous human rights opinion. What kind of madness is that?

When it comes to the International Labour Organisation, which the Secretary of State likes to reference, its idea of minimum service requirements is clearly intended to be based on endangerment to life, personal safety or health. This wide-ranging legislation goes way beyond those parameters. The ILO makes it clear there should be an independent arbitration body, yet this Bill is completely silent on such a body. Why is that?

It is also clear that any minimum service level is supposed to be just that—a bare minimum. We have no idea what this Government will railroad through via statutory instruments. Statutory instruments cannot be amended and the last time a Government was defeated on a statutory instrument was in 1979, so we know all power rests with the Government there.

As Liberty has observed, the Bill does not create any form of minimal service. Liberty also confirms that MPs debating this legislation on Second Reading will not know exactly what they are voting for, so all the Tory MPs in the Chamber who are going to take part in the debate and then trot through the Lobby will do so blind to what the future legislation and regulations on minimum service will look like. It is an affront to democracy. Any Tory MP who claims to care about parliamentary sovereignty cannot possibly vote for this Bill.

The Bill is made worse by the Henry VIII power that allows amendment and revocation even of future legislation not yet passed. We can see how the Government are ramming this Bill through Parliament with minimum scrutiny and a proposed programme motion allowing just five hours for Committee. It really is an assault on democracy. The fact that the Bill comes into effect immediately once passed, so that work notices and actions can be taken by employers for strikes that have already been voted through, shows just how ridiculous this assault on workers is.

The impact assessment for the Transport Strikes (Minimum Service Levels) Bill observes that on a strike day in July 2022, 20% of rail services were still in operation. Right away that suggests to me that a minimum level of service was operating. What do the Tories really think a minimum service is, if 20% is not a bare minimum? There are huge ramifications here for rail workers overall, because if this Government force through a high threshold of minimum service, strikes by signalmen and track operatives will effectively be banned. A high minimum service will force all those guys to work to keep the tracks in operation and the trains running, effectively blocking strikes by the back door.

What will minimum service look like for teachers? Where does that fit in with all the talk about safety? What happens to train companies that cannot provide a minimum service at the moment, especially if union members decide not to work on their rest days and to work to rule? Where will that leave this Government on minimum service level obligations?

The overview in the explanatory notes makes it clear that the ability to sack workers is a key aspect of the Bill. That is the polar opposite of what was said when a transport strike Bill was listed in the Queen’s Speech in December 2019, when it was stated that workers would not be discriminated against. Why are the Government now threatening people’s livelihoods?

Despite what the Secretary of State says, it is also clear that this legislation will allow employers to target those they think are part of an awkward squad. Allowing employers to decide who has to work on notified strike days clearly infringes on workers’ rights to withdraw labour. Instead of the illegal blacklisting previously done by some companies, employers now can name workers they want to break a strike, and sack those workers if they stay true to their beliefs. How can that be deemed acceptable?

The sacking aspect is the proof that this is nothing to do with minimum cover by ambulance staff, as the Secretary of State likes to tell us. It also ignores the fact that section 240 of the 1992 Act, as my hon. Friend the Member for Glasgow South West (Chris Stephens) keeps saying, allows for preserving life and limb, and that unions have their own practices to comply with that legislation. For fire services, the Secretary of State could also utilise the Fire and Rescue Services Act 2004, if he felt the desire to do so.

It is crystal clear that this legislation is not required. It is an attack on democracy and the right to strike; it will prolong industrial disputes, not resolve them; it will allow individual workers to be targeted through work notices; and it is politically stupid. We have to wonder why this Tory Government are looking to antagonise something like 7 million workers across these sectors. It also shows an astonishing level of incompetence to bring in legislation that potentially allows them to sack essential workers in vital sectors where there is already a shortage of skilled workers.

The public can see through a Government who partied while clapping the nurses and now threaten them with the sack. They should follow the lead of the Scottish Government and get around the negotiating table. The resolution of the ScotRail dispute has been commended by both the RMT and ASLEF. There are no strikes planned in the health service in Scotland and the pay deal being implemented by the Scottish Government is one that the UK Government should replicate as a starting point when they get around the negotiating table.

It is outrageous that the Scottish Government, who have been negotiating in good faith with the unions, will now have this legislation foisted upon them—legislation that Westminster could use to force work notices through in Scotland against the wishes of the Scottish Government and that could ruin otherwise good working relationships in Scotland. Employment law should be devolved to Scotland, but even that would now just be a sticking plaster. It is perfectly obvious that what Scotland now needs is the full powers of a normal, independent country.

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chair of the Transport Committee.

Industrial Action

Alan Brown Excerpts

Tuesday 10th January 2023 Commons Chamber

[Mr Speaker]

I call the Scottish National party spokesperson.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

This Government have already created the most restrictive and anti-trade union laws in Europe. This new right-wing culture war stinks, and they are using ambulance cover as a pretext to attack workers’ rights. It was the Tory membership that gave us a Prime Minister who tanked the economy overnight, put people’s mortgages up and gave us high inflation, yet it is the Tories who continue to demand that public sector workers take the hit to balance the books.

Everyone can see the irony of the Tories clapping key workers and now giving them a pay cut and threatening them with the sack for future action. Does the Secretary of State really think that ordinary people support Tory plans over the nurses? Does he realise that the public can see Pat Cullen and Mick Lynch destroying their arguments and soundbites? Does he understand that train commuters, who already suffer from appalling service, will be raging when they find out how much money train companies are making from strike days, paid for by taxpayers? How much money has been paid to train companies that could have gone to workers instead?

It has not been easy for the Scottish Government, but they have negotiated better pay settlements for Police Scotland, train crews and NHS workers. It is something that the Royal College of Nursing would be willing to discuss with the UK Government. Those actions were commended by the unions, but not even acknowledged by Labour. There are no ambulance strikes in Scotland, and that has been done within a fixed budget and negotiations with one hand tied behind our back. Now, despite working with the unions, Scotland is to have the same anti-worker or anti-union legislation imposed on it, against the wishes of the Scottish Government. It is an imposition made easier by the Labour party agreeing with the Tories that workers’ rights should remain with Westminster and not be devolved to Scotland. We do not want to be part of plans designed to sabotage workers’ rights. This situation has clearly shown once again that if Scotland is to become a fairer, more equal country that respects workers’ rights, the only way to do so is to become a normal independent country.

[Grant Shapps]

The hon. Gentleman tries to push the argument that somehow this legislation will take us out of step with other European countries, and I have already explained that it is we who are out of step with what already occurs elsewhere in Europe. If we go beyond Europe, he will be interested to hear that in Australia, Canada and many states in America, blue-light strikes, as we would call them, are banned entirely. We are taking a moderate, sensible approach. I would have thought that the hon. Gentleman would wholeheartedly support protecting his constituents in that way. While we are taking lectures from him about how the Scottish Government handle these things, I could not help noticing that Scottish primary school teachers are on strike and secondary teachers go on strike in Scotland on Wednesday.

Prepayment Meters: Self-Disconnection

Alan Brown Excerpts

Thursday 15th December 2022 Commons Chamber

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I commend my hon. Friend the Member for Glasgow North East (Anne McLaughlin) for securing this debate. She rightly said she is looking for action, and action now, rather than self-awareness, but she also said she is hopeful, verging on confident, that the Government will take action. I do not share her confidence, but hopefully the Minister will prove me wrong.

I also commend the hon. Members for Glasgow North (Patrick Grady), for East Lothian (Kenny MacAskill) and for Hornsey and Wood Green (Catherine West) for their contributions.

Obviously, I disagree with the inequity of higher standing charges being applied to people on prepayment meters. We have heard several times how people with disabilities already pay more just to get through their day-to-day life, and they suffer from paying these higher charges, too. My hon. Friend the Member for Glasgow North East and the hon. Member for Glasgow North paid tribute to Marie Curie and its “Dying without Dignity” campaign. It is heartbreaking to hear the personal example of the friends of my hon. Gentleman. I hope Mel and Tom get all the support they need. The hon. Member for East Lothian completely destroyed the euphemism of self-disconnection, and the hon. Member for Hornsey and Wood Green covered a range of topics and constituency issues.

As well as paying tribute to hon. Members, I pay tribute to the organisations that work tirelessly on these matters, including the End Fuel Poverty Coalition, National Energy Action, Energy Action Scotland and Citizens Advice Scotland. They all agree that forced prepayment meters, especially during this cost of living crisis, will create more problems for the most vulnerable and for society.

As we have heard, the reality is that people are automatically disconnected once they reach £10 of credit. Fuel Poverty Action says:

“Imposition of a pre-payment meter is disconnection by the back door. When you can’t top up the meter everything clicks off, regardless of whether you are old, ill, or have a newborn baby.”

Forced prepayment meters mean that people who are already struggling are put on a system where they have to ration their energy and can be automatically disconnected when they reach their credit limit. They are also more likely to have a cold, damp home, with the consequent long-term health implications and the immediate heating or eating dilemma.

It is estimated that 19% of houses in the UK are damp, but the figure increases to nearly a third, 31%, of houses with a prepayment meter. In other words, a household on a prepayment meter is 65% more likely to live in a damp house compared with the average baseline.

Health conditions associated with living in a damp house have a consequence for our already stretched national health services. That reality is confirmed by figures from YouGov’s “Warm this Winter” campaign, which show that 51% of prepayment customers have health conditions or disabilities.

As the hon. Member for Glasgow North said, we have to accept that, on one level, the majority of customers on prepayment meters have chosen this as a way of managing their cash flow and energy use, but it makes no sense that the most vulnerable pay higher standing charges and are therefore at more risk of being cut off because of the £10 credit limit.

Research by Utilita indicates that as many as 14% of the 4.5 million prepayment meter households—that is 630,000 households—did not actively choose to be on these tariffs but were forced on to them. The number will dramatically increase during this cost of living crisis unless the Government take steps to ban forced switching to prepayment meters.

A recent investigation for i revealed that energy firms have secured almost 500,000 court warrants to install prepayment meters in the homes of customers in debt since the end of lockdown. That is an astonishing number, and Ofgem and the Government need to get a grip. Further freedom of information requests reveal that 187,000 such applications were made in the first six months of 2022 alone. There is a real concern that the courts are now rubber-stamping warrants to install prepayment meters.

Although I have been talking about prepayment meters, the roll-out of smart meters means that customers can be forced on to prepayment mode without the need for a warrant or for the meter to be physically changed, as they were at one time. Again, I support the End Fuel Poverty Coalition’s call for a ban on switching customers to a prepayment meter under warrant and a ban on switching customers’ smart meters to prepayment mode without their active, informed consent.

The stark reality is that the most vulnerable are being forced on to prepayment meters. They then enter a cycle of unaffordability, energy rationing, disconnection and damp housing. To compound matters, many are missing out on the Government’s support package, which makes this pernicious cycle even worse.

Caroline Abrahams, charity director of Age UK, says recent Government figures suggest that more than 40% of vouchers sent to prepayment meter households are yet to be redeemed. She expressed her concern at the estimate that at least 150,000 older households relying on old prepayment meters will miss out on the £400. This is completely unacceptable, so I ask the Minister to advise the House on what the Government are doing to ensure that the most vulnerable are able to access and use their vouchers or, if they cannot, to get some form of credit on their account.

It is unconscionable to continue charging those on prepayment meters, who are more likely to be on lower incomes, more than customers who pay for their energy by direct debit. The energy companies may argue that prepayment systems cost more to administrate, which is probably true of collecting payments, but the additional cost should not be carried by those least able to afford it. Access to energy is literally a life or death scenario, and we need to remove this standing charge inequity.

Let me illustrate the difficulty. I know someone who chooses to be on a prepayment meter. He did not use gas at all over the summer, but when he wanted to turn on the heating at the start of winter, he had to pay £70 to clear the standing charge debt built up over the summer. He could afford to do that, so it was fine, but others who rationed their energy over the summer will not be so lucky.

A briefing from Energy UK confirms that, under licence requirements following Ofgem’s measures, suppliers should identify prepayment meter customers who are self-disconnecting and offer short-term support through emergency and “friendly hours” credit, as well as offering additional support credit to prepayment meter customers in vulnerable situations. In my example of a person having to pay £70 to clear the debt accrued over the summer, the supplier did not make contact to check whether there was any vulnerability or whether assistance was required. Ofgem and the Government need to ensure such steps are taken in the here and now. They must ensure that suppliers give such assistance, as per their licence obligations.

The Government may talk up the energy price guarantee, and the billions of pounds of support allocated by that package sounds good on paper, but the reality is that, even with the current unit caps, it is estimated that average bills will cost £2,500, or £3,500 in Scotland. National Energy Action estimates there are 6.7 million households in fuel poverty, which will rise by 1.7 million in April when the average bill rises to £3,000. Nearly a third of households in Great Britain will be in fuel poverty come April.

The reality is that the energy price guarantee is no guarantee at all. Average bills are much higher in Scotland, even though, as the hon. Member for Glasgow North said, we generate the bulk of the UK’s renewable energy. It is completely unfair that Scotland generates this energy, yet Scottish people are struggling to pay their bills.

I completely support a ban on forcing customers on to prepayment systems, and the higher charges applied to prepayment systems have to be abolished, and abolished now. It is time for a proper social tariff. I accept that the Government have confirmed that they are looking at implementing one, but I fear that that will take too long and that this will, invariably, be kicked into the long grass and left to the next Government.

I also support tiered tariffs, similar to the Dubai slab tariff. That would mean that those with the lowest energy usage got a significantly lower tariff. I would extend that to those classed as vulnerable and then have incremental tariffs based on usage. In general, therefore, those who used more energy and could afford to pay more would do so, as per affordability. Such a system would also incentivise demand management, which is good for the system overall.

The reality is that more action is needed on this now, as my hon. Friend the Member for Glasgow North East said. I look forward to what the Minister will say, but I find it strange that a Treasury Minister will wind up rather than a Minister for the Department for Business, Energy and Industrial Strategy, which I would have thought would be all over this.

--- Later in debate ---

[Kevin Hollinrake]

Other Members have made that important point, and I will come to it, but I had better make some progress, because you asked me to finish in about four minutes, Madam Deputy Speaker, which I shall endeavour to do.

We believe that there is a role for prepayment meters. Ofgem rules already require energy suppliers to offer a prepayment service only when it is safe and reasonably practicable to do so, and that applies whether a meter is smart or traditional. There are clear obligations on energy suppliers regarding customers in payment difficulty, and a prescribed process for occasions on which a warrant is required. That point was raised by the hon. Member for Kilmarnock and Loudoun (Alan Brown) and, indeed, by the hon. Member for Glasgow North East.

There are clear expectations for suppliers in respect of the steps to be taken before they instal a prepayment meter owing to debt, or switching a smart meter from credit to prepayment mode. Those steps include conversations to discuss debt repayment, budget management and energy efficiency measures, and referrals to debt advisers and charities. Before a prepayment meter is chosen as the debt repayment pathway, its safety must be assessed, as well as the customer’s ability to pay. Suppliers must give their customers seven days’ notice before installing a prepayment meter or switching a smart meter to prepayment mode. Ofgem recently published a regulatory expectations letter, in which it set out its expectation that suppliers will ensure that prepayment meters are safe and reasonably practicable in every case.

I would like to highlight some of the circumstances in which it is not deemed safe to have a prepayment meter, which include having specific disabilities or illnesses, or having children under five, as has been set out. Indeed, the hon. Member for East Lothian (Kenny MacAskill) raised that point. It is absolutely right that we provide support for those who are most in need.

The hon. Member also raised the issue of social tariffs, which were introduced in 2008 as part of a voluntary agreement between the Government and energy suppliers. They were replaced by the current mandated warm home discount scheme in 2011. This has improved outcomes by providing consistent and transparent benefits, and by utilising data matching to improve targeting. Clearly, it is important that we continue to review our current provisions and see what else might be done to help people in those circumstances.

[Alan Brown]

The Minister almost seems to be making an argument that the warm home discount scheme has been more successful than the social tariffs. Why then has the Department for Business, Energy and Industrial Strategy confirmed that it is considering revisiting social tariffs? I do support that, but he seems to be making a contrary argument.

[Kevin Hollinrake]

I do not think it is a contrary argument. We should always look to improve our rules. We believe it is an improvement on the past scheme, but there may be further improvements we can make. That is the right iterative process to take.

Oral Answers to Questions

Alan Brown Excerpts

Tuesday 29th November 2022 Commons Chamber

[George Freeman]

My hon. Friend has put his powerful point on record. I can assure him that the Department is actively working with the Treasury to make sure that those sorts of schemes are accelerated.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Is it still in the Department’s plans to take a 20% shareholding in Sizewell C? If so, will that result in a capital spend of £6 billion or £7 billion—money that could be better spent elsewhere? Private investment could be freed up in the Scottish cluster if it was made a track 1 cluster and pumped storage hydro could be helped by agreeing a pricing mechanism for electricity.

[George Freeman]

Unlike the Scottish nationalists, we are committed to the private-public partnership that drives investment in our nuclear industry, and Sizewell C is a major commitment. The Government are proud to be partnering with industry, and it is a shame that the Scottish nationalists are not similarly partnering with industry for the benefit of Scots voters and bill payers.

Energy Security

Alan Brown Excerpts

Tuesday 29th November 2022 Commons Chamber

[Mr Speaker]

I call the SNP spokesperson.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

The reality is that this statement is just a padding out of the press release that BEIS put out earlier. I do welcome the energy company obligation funding for energy efficiency, but I think we need to be clear that this is not Government money; it is money funded from our energy bills and paid for by all bill payers. One issue with ECO4 is that it cannot be combined with other grants, whereas ECO3 did allow that money to be combined with other grants to bring down the costs of external insulation, for example. That is something the Secretary of State could consider to make schemes more affordable for people. The reality with EPC bandings is that there are more homes currently rated D to G than A to C, so much more direct investment is needed in energy efficiency to rectify that.

The Secretary of State talked about energy security, so does that mean that the Government have finally bought out China General Nuclear from the Sizewell C consortium? Talking about sovereignty, will he confirm that uranium imports are going to be needed to keep Sizewell C going? Is it still the intention to take a 20% stake, and does that mean funding capital of £6 billion or £7 billion towards Sizewell C, because there is still no clarity in today’s statement? On the myth about nuclear baseload, by the time Hinkley Point C comes on stream, seven of the eight existing nuclear power stations will have stopped operating, which proves there is no need for nuclear baseload whatsoever.

On wider energy policy, the Scottish carbon capture and storage cluster was the most advanced project, but it was still only classed as a reserve. Will the Government urgently review this classification, and make the Scottish CCS cluster a track 1 cluster to allow that investment to be released and for that project to go ahead? Pump storage hydro, as I have raised several times, could deliver about 3 GW of power by 2030. All that is needed is an electricity pricing mechanism—a cap and floor mechanism—so will the Government urgently review that and start these discussions?

Finally, we know about the oil and gas investment allowance. If we are going to have continued record investment in renewables, there should be a renewables investment allowance to encourage that, particularly for green hydrogen.

[Grant Shapps]

Yes, I can confirm that China has now been bought out of the deal on Sizewell. The money yesterday ensured that it is no longer involved in the development.

The hon. Gentleman asked about the future funding for Sizewell. He may be familiar with the new “regulatory asset base” approach to funding, which is built along similar lines to the contracts for difference that have been used so successfully for offshore wind power. That is how we will look to bring income to the project. I should also say that CfDs will now take place on an annualised basis, which will give those including Scottish clusters the opportunity to bid in as well.

I am always curious about the SNP’s approach to energy. As far as I can work out, it does not like the oil and gas industry—even though the industry employs thousands of its constituents—and it absolutely hates nuclear. I am not quite sure what it wants to do on non-windy days.

Britain’s Industrial Future

Alan Brown Excerpts

Tuesday 15th November 2022 Commons Chamber

[Bill Esterson]

I am grateful to the hon. Gentleman for asking the question, because it reminds us all that the Conservative Government have cut the number of ships from 13 to eight—so I would be careful about claiming that as a great big success story—and they still have not made a decision on the Fleet Solid Support Ships.

With Labour, Britain can become a global leader in producing electric cars and in self-sufficiency in renewable electricity generation. Meanwhile, the Conservatives continue to drag their feet and retain the moratorium on onshore wind. When the Prime Minister was asked about onshore wind, he answered by talking about offshore wind. It is almost as if he did not understand the difference.

Onshore wind is one of the cheapest forms of energy, and we will double its capacity. We will treble solar and quadruple offshore wind production. We will support nuclear, tidal and hydrogen, because they are all part of a low-carbon future, but not least because Labour will be an active Government, willing to champion British industry and help to create the jobs and prosperity of the future.

Our plans for renewable electricity generation will mean cheaper bills for industry and households. They are being drawn up with business, informed by the evidence presented to us by employers and trade unions alike. Partnership, planning, investment and certainty: those are the elements industry needs to succeed. They are the foundations of the framework that industry will be able to rely on alongside a Labour Government.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

On energy policy and lower energy bills, the shadow Minister mentioned nuclear power. Sizewell C nuclear power station is going to cost something like £30 billion in capital expenditure. The UK Government’s impact assessment, when the capital costs and finance and borrowing costs are taken into account, estimates that it will cost £63 billion. Does he really think that is a good way to spend money?

[Bill Esterson]

The way the Conservative Government reached the deal was not good value for money, and we certainly should not do that again, but nuclear is a key part of our transition to renewable electricity.

When I visit companies developing new technologies, they are excited by the prospects and the ideas they are developing. Whether on decarbonising air travel, installing insulation in millions of homes, as our energy efficiency plans will do, or our world-class defence companies delivering economic prosperity while keeping us safe, all the businesses I meet want to work with Government. They want a Government who offer stability and are a willing partner, who will lead the world in renewable technology, who will herald the vanguard of new electric vehicles and will supply the world with cutting-edge green steel.

The Conservatives have failed over the past 12 years. Their answer is to offer the slowest growth in the OECD over the next two years after crashing the economy. It does not have to be this way. Britain’s best years really can lie ahead. Britain really can be the best place to start and grow a business. The British Government really can be the partner to industry, ensuring that we make, buy and sell more in Britain. With our industrial strategy and our green prosperity plan, Labour will ensure that, together with business and the workforce, we really can deliver prosperity through partnership.

--- Later in debate ---

[George Freeman]

My hon. Friend, as ever, makes a very interesting policy observation; as Minister for science, I will not accept it at the Dispatch Box, but I will raise it with the Ministers for industry and for energy.

[Alan Brown]

The Minister mentioned nuclear power. He heard what I said about costs earlier, but it is also reported that the Government are taking a 20% share in Sizewell C. Does that mean the Government are going to borrow £5 billion or £6 billion to pay for their 20% share of Sizewell C?

[George Freeman]

How interesting to hear the SNP take issue with—[Interruption.] The hon. Member asked the question, so I will answer it. We are determined to make sure that, unlike parties on the Opposition Benches, we invest properly in new nuclear in this country, so that we have a resilient, clean and secure energy system. If that means an active industrial strategy to ensure we are able to do it, we are doing it. It would be nice to hear the SNP Government in Scotland take a similar approach to their future and to nuclear in this country, which is vital for the next few years as we get through this global tightening in energy.

--- Later in debate ---

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Interestingly, the Minister kept using the phrase “industrial strategy” without acknowledging that the previous BEIS Secretary actually ripped up and abandoned the UK Government’s industrial strategy. So there is not an industrial strategy; there is just a series of ad hoc announcements of money and targets that are arbitrary. We do not have a coherent strategy that links it all together.

I should start by welcoming today’s news of the confirmation of the £4.2 billion order for the five Type 26 frigates awarded to BAE Systems at Govan and Scotstoun. Those ships will now be built in the dry because BAE has been able to commit to the £200 million factory that was previously promised by the UK Government some way back. It is not the number of frigates that was originally promised, but there is no doubt that the announcement today is good news for the workers in Glasgow.

That good news is in contrast to a couple of stories and events from yesterday. In the Chamber, the former Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for Camborne and Redruth (George Eustice), let slip what many of us had been saying for long enough, which is that the Australia and New Zealand trade deals that the Government signed are utter rubbish. Also yesterday, Bloomberg ran a story confirming that Paris’s stock market has now exceeded London’s stock market in value. These matters are interlinked. It is a combination of Tory free market ideology and Brexit, of course, and we continually see proof of the harm of Brexit in the UK’s performance compared with G7 and G20 countries.

There was a big lack of talk of Brexit in the contribution of the shadow Minister, the hon. Member for Sefton Central (Bill Esterson). Despite what we know of the harms of Brexit, Labour now says it wants to make Brexit work. Free movement of people has gone, the Labour leader tells us. We have recruited too many people from overseas into the NHS, he tells us. But the reality is that, when Labour has such a lead in the polls, it should be offering bolder plans, such as rejoining the single market, and certainly allowing free movement of people so we can grow the economy again. Right now the Labour position seems to be, “We won’t be quite as bad as the Tories”. That is hardly ambitious.

We have to be realistic: if we want to increase skilled jobs and the workforce, while continuing to recruit for the service sector, the hospitality industry, the NHS and so on, we need inward migration. There may be a legitimate debate about the fact that too many people have exited the workforce for various reasons, but the reality is that we currently have record low numbers of people seeking work compared with vacancies, so clearly immigration is required, and free movement of people with the EU is the logical step to achieve that.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

My hon. Friend is making a powerful point. Of course, we need people to staff industries—in my constituency, hospitality is crying out for people and the health industry is crying out for people—and we used to be able to count on EU citizens, but there are not the people there to replace them. It is vital for a country such as Scotland to have a different approach from the one taken by this Government and this place over immigration. Our historical problem has been that we have suffered from emigration, rather than immigration, and we need people in Scotland.

[Alan Brown]

Absolutely. It is all about keeping that balance of population, growing the workforce, growing the skills base, helping our businesses grow and growing the tax base as well, which creates a fairer economy for all.

For too long in the UK, deindustrialisation was deemed acceptable as long as the financial City was booming in London, but that has been the wrong strategy for decades now. It has left coalfield areas such as my constituency struggling, not to mention the loss of industry and manufacturing in the main town of Kilmarnock and the Irvine valley. That has been replicated in industrial areas up and down the UK. The Tories have arguably now recognised this with the so-called levelling-up agenda, but that is a slogan that admits all those years of failure in terms of deindustrialisation. In reality, it was just a political strategy aimed at the red wall seats. The levelling-up agenda is so ad hoc that nobody can define what it means in terms of outputs and measures, and it opens the way for more political chicanery.

It is clear that Brexit has produced challenges for the automotive industry: additional paperwork; and rules of origin which will become more challenging for the industry as times goes on. According to the Society of Motor Manufacturers and Traders, despite recent increases in sales, 2022 is on course to be the weakest for car sales since 1982—a 40-year low in sales as we move into recession in the UK and have inflation at a 40-year high. On car manufacturing, while we know there have been global supply chain issues and long lead-in times for parts, the reality is that there has been a drop in output in the UK compared with the rest of Europe. Only Germany has suffered a bigger percentage decrease in manufacturing output.

On wider industrial strategies in car manufacturing and EVs, we must address the electric vehicle charging roll-out. The Government have a target of 300,000 charge points installed by 2030. That means that, each year from next year onwards, 31,000 charge points need to be installed; that is because only 34,000 have been installed to date. When we consider that the cumulative total installed at present needs to be installed nearly every year for seven years to hit the target, we realise the Government do not have a coherent strategy to achieve that.

I welcome that the battery car sales market share has increased and plug-in vehicles now account for over 21% of new sales, but we need to make sure the lack of infrastructure does not stall sales and output of such vehicles. In small, independent Norway, last year, EVs accounted for 65% of market share.

[Gavin Newlands]

Does my hon. Friend agree that, in Norway and in Scotland—which has twice as many rapid chargers per head as England, including London—it was public investment by the Government that got that going, leading to a better system of chargers? Then the private sector was brought in. That is the way to go, rather than starting private, as the UK Government did.

[Alan Brown]

I absolutely agree. The Minister challenged us earlier to welcome public-private investment partnerships; I hope the Minister who winds up will welcome that investment in Scotland and that Scotland and Norway have shown how it can be done.

On the bus manufacturing sector, again, unfortunately, we have had a complete UK Government failure. Just yesterday, The Times ran a story saying that only six low-emission buses out of the 4,000 promised by the previous Prime Minister, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson), have entered service in England. Of the promised £3 billion bus fund, 40% still remains unallocated, and only 341 orders have been placed out of the 4,000. It is therefore clear that urgent intervention is required to get manufacturing in the UK up and running. Even worse than that, the first ZEBRA—zero emission bus regional areas—contract was awarded abroad, to China. There is no scope in the current tendering process to assess added value of UK content and community benefit, which would help UK manufacturing companies. That is a complete failure by the Department for Business, Energy and Industrial Strategy.

In contrast, the Scottish Government have led the way on this. Three hundred buses have been delivered under the Scottish ultra-low-emission bus scheme, and almost the same number has now been delivered through the Scottish zero-emission bus challenge fund. However, the reality is that companies such as Alexander Dennis need to see more orders via UK Government funding. If they are talking about an industrial strategy and promoting UK manufacturing, they need to do something to get these buses made by UK-based companies.

The motion refers to net zero and creating jobs. Net zero has to be the future if we are going to save the planet. It should be part of a just transition for the oil and gas industry. With the right support for emerging technologies such as tidal stream, Scotland in particular can be a manufacturing and technology exporter. Green hydrogen needs to be supported in a much bigger way, given investments being made elsewhere in Europe.

In 2020, renewable sources provided almost 100% of the equivalent gross electricity consumption in Scotland, and that was despite the UK Government effectively pulling the plug on onshore wind for a six-year period. Scotland currently has the largest deployment of grid-generating tidal stream turbines, and there is the potential of up to 11 GW of electricity to be generated from tidal stream. Scotland is also leading the way on floating offshore wind. In terms of fixed offshore wind, ScotWind has the potential to develop more than 20 GW of offshore wind in the coming years. With the size of the wind farms being developed, there really is a chance of establishing turbine manufacturing in Scotland, so it is critical that all the permissions are put in place.

However, in Scotland we also have the paradox that Westminster holds all the levers of power in terms of main energy policy. The auction process and procurement rules all lie with Westminster. The setting of the grid charging regime and the regulator lie with Westminster. Borrowing powers to invest lie with Westminster. The ability to pull funding or prioritise projects such as carbon capture and storage lie with Westminster. That is underlined by the disgraceful fact that funding was pulled from the Peterhead CCS project and that the Acorn project is still classed as a reserve project despite having been the most advanced and rounded project overall in terms of CCS clusters.

It is Westminster who can decide on a pricing mechanism for pumped storage hydro or not and, so far, they have ignored the calls to sit down and discuss a cap and floor mechanism for electricity generated by pumped storage hydro. It is Westminster who have control of the consenting rules and processes under the Electricity Act 1989 and are prioritising another £30 billion of capital spend for Sizewell C nuclear power station. It is Westminster who squandered £380 billion of oil and gas revenues.

Despite that—bizarrely—we have Unionists right now seeming to take glee from the fact that not as many jobs may have been created by the onshore wind sector as was originally hoped. That is as much as anything down to procurement processes, which for years the SNP has called to be changed to allow for local content. Right now, we have Unionist glee as they believe that, somehow, Scotland’s renewables potential has been overblown or overhyped by politicians. I assure them that it certainly has not. A report prepared by the Landfall Strategy Group illustrates that pursuing offshore wind and tidal resource alongside a green hydrogen strategy could create up to 400,000 jobs by 2050 and £34 billion in gross value added. That is the sort of ambition required, and that seems to be deliverable only through independence and the full levers of power.

--- Later in debate ---

[Kevin Hollinrake]

The hon. Gentleman made some good points about the opportunities on Teesside. Carbon capture and storage and Net Zero Teesside represent a huge opportunity and something that is on the Government agenda. We are also looking into the life sciences sector in Teesside and the first large-scale lithium refinery in the country, with 1,000 jobs in construction—all these things are happening on Teesside. I recognise his point on the steel sector, but all this carbon capture and storage may well form part of the future for Teesside.

The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) made some interesting points about buying British. I think everyone in this House would agree on the need to buy British, but does he accept that, that as the trade and co-operation agreement and others open up EU markets to UK companies, we cannot on that basis expect to close our markets to EU countries, or to countries from around the world? We believe in international trade—[Interruption.] Well, I also believe in buying British. I share his enthusiasm for the Government’s £206 million investment in a UK Shipping Office for Reducing Emissions—the biggest Government investment ever in that sector.

Manufacturing has been at the heart of our economy for centuries—the shipbuilding, automotive and steel industries perhaps more than any others. In 2021, manufacturing contributed more than £205 billion gross value added to the UK economy, which is the fourth highest figure in Europe. Manufacturing, which is responsible for almost half of UK exports, has a vital role to play in driving innovation, job creation and productivity growth beyond the bounds of the M25. The hon. Member for Kilmarnock and Loudoun (Alan Brown) will be pleased to note that 95% of manufacturing jobs are outside London.

[Alan Brown]

Does the Minister accept that although we cannot necessarily stipulate to buy British, procurement can be managed by assessing community benefit and local content as part of quality assessments, so that it is not a case of price takes all? That is not happening with the Government’s bus procurement strategy, and it did not happen long enough in the CfD auctions, either. Is that not something that the Government need to address?

[Kevin Hollinrake]

The hon. Gentleman makes a fair point. Certainly, the Cabinet Office is looking at procurement strategy now, and nudges could be made. My point is that we cannot expect other markets to open their doors to our businesses if we close our doors to theirs.

From Sunderland to south Wales, industries are at the heart not just of our economy, but of our communities. Those industries are integral to our economic policy, and the Government are ensuring not just that they are alive and kicking, but that they prosper in the 21st century. Together, Government and business are laying the foundations for an economy that is fit for the future. By delivering the new infrastructure, industries, skills and jobs that we will need to meet the demands of the day, we can deliver a future for all that is more sustainable, secure and prosperous. Across the country, we are already seeing stories of success.

Let me begin with shipbuilding. The UK has always been and always will be a seafaring nation. Today, the shipbuilding industry supports 46,000 jobs in places such as Portsmouth and Rosyth, and adds £2.4 billion to the British economy. I am glad that the hon. Member for Kilmarnock and Loudoun welcomes today’s £4.2 billion order for five Type 26 frigates, which will be built in Glasgow.

Earlier this year, we refreshed our national shipbuilding strategy, unlocking more than £4 billion in investment for maritime firms from the Solent to the firth of Forth. We are improving access to finance by providing credit for UK ship buyers through a home shipbuilding credit guarantee scheme, and we are working closely, through the shipbuilding enterprise for growth, to raise the productivity and competitiveness of UK shipyards.

This is not just a story of success at sea; we are leading the way on land, too. We are the sixth largest automotive producer in Europe, and the sector is one of the engines driving forward our plans for green growth in every corner of the country. Last year, Nissan announced £1 billion in investment to create a world-first electric vehicle hub in Sunderland, safeguarding 6,200 existing jobs and creating more than 1,000 new ones. We know that there is some way to go, but this Government are committed to putting the pedal to the metal and doing all we can to accelerate our efforts.

Many Members quite rightly talked about steel. The Government recognise the challenging international economic environment in which the steel industry has to operate, including in relation to overcapacity. Above all else, we understand the vital role that steel occupies as a cornerstone of the UK economy, underpinning domestic industries and local communities. Over the past nine years, the Government have committed £800 million towards electricity costs through the energy intensive industries compensation scheme, on top of the energy bill relief scheme. Of course, we continue to consider what can be done to ensure that the steel industry is competitive, in fair terms, with other nations.

On critical and advanced materials, we are investing in the materials of the future. That is why we published in July our first ever critical minerals strategy, which sets out our plan to secure our supply chains. We are boosting our domestic capabilities in the production and processing of critical minerals, building a circular economy where they can be recovered, reused and recycled.

The story really could go on, but I think I have made my point. This country has a rich industrial history that goes back centuries. Our world now looks very different from the 18th century, but one thing remains the same: that particularly British spirit of innovation and enterprise. This Government can and will play their part so that no community or corner of this country is left behind.

Question put and agreed to.

Resolved,

That this House condemns the Government for its lack of policy on British industry including the steel, automotive and shipbuilding sectors; regrets that after 12 years of Conservative Government, the UK has the lowest levels of business investment in the G7; recognises the large number of high-quality jobs created by British industry, as well as its importance to achieving the UK’s net zero targets; calls on the Government to recognise the unique challenges and opportunities in each of these sectors; and therefore further calls on the Secretary of State for Business, Energy and Industrial Strategy to urgently bring forward plans to ensure these sectors are supported and to avert job losses that will have a devastating impact on communities and the wider economy.

Energy Bill Relief Scheme Regulations 2022 Energy Prices (Domestic Supply) (Northern Ireland) Regulations 2022 Energy Bill Relief Scheme (Northern Ireland) Regulations 2022

Alan Brown Excerpts

Monday 14th November 2022 General Committees

[Ms Ghani]

It is a pleasure to serve under your chairmanship, Sir Roger. I am doing my best to represent my right hon. Friend the Member for Beverley and Holderness (Graham Stuart), who is the Minister responsible for this brief. On a good or a bad day, I might look like him; I am not quite sure.

I will give some background to the regulations. The energy bill relief schemes, which I will collectively refer to as EBRSs, and the energy price guarantee—the EPG—have been introduced at pace to protect the public from the effects of soaring wholesale energy prices. The ERBSs are intended for those on non-domestic tariffs and the EPG for those on domestic tariffs. Unconstrained high prices would put significant financial pressure on UK businesses, charities and public sector organisations such as hospitals and schools. They would significantly increase the cost of living for households too. The wider negative effects of such economic pressure would be severe and materialise very quickly in the absence of an intervention of this kind.

The EBRS regulations for Great Britain, the EBRS Northern Ireland regulations and the EPG regulations have been created under the Energy Prices Act 2022, which gained Royal Assent on 25 October 2022. The regulations are essential secondary legislation required to implement the schemes.

I now turn to the detail in the EBRS GB and EBRS NI regulations. The regulations set out that, with few exceptions, all non-domestic customers with electricity and gas contracts from licensed non-domestic energy suppliers will be eligible for a discount. The discount will be applied to the wholesale price element of the bills, and the regulations set out how the discount has been calculated. The regulations cover the process by which the energy supplier is reimbursed by the Secretary of State for the discount. The regulations also give powers to the Secretary of State to delegate this function where appropriate. Further provision is included to prevent suppliers or customers from deriving greater benefit than is intended, to protect the integrity of the schemes. The regulations provide for an additional reduction to be applied for qualifying financially disadvantaged customers, who are supplied under the so called “deemed” or “out of contract” contracts.

The EBRS NI regulations prevent end users outside Northern Ireland from receiving a discount to their bills. Finally, the regulations cover essential operational matters including information, a reporting obligation, enforcement powers and powers to impose civil penalties in respect of missing or defective declarations.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Will the Minister give way?

[Ms Ghani]

Perhaps if the hon. Gentleman allows me to continue, I will answer his question. To accompany the regulations, we have published a suite of legally binding rules and non-statutory guidance, which provides further detail on how the schemes work.

I turn to the energy price guarantee. The EPG schemes in both Great Britain and Northern Ireland are intended for customers on domestic tariffs. The Energy Prices Act 2022 set out that EPG NI schemes are to apply to those with domestic electricity and gas supply. The EPG regulations define domestic electricity supply and domestic gas supply for Northern Ireland. Those definitions will mean that some non-domestic premises will be in scope of the energy price guarantee electricity scheme in Northern Ireland. That includes some places of worship that have similar metering and tariff arrangements to domestic premises.

These non-domestic premises will receive EPG support instead, since there was no timely way for energy suppliers to disaggregate them from traditional domestic premises with similar metering and tariff arrangements. Both the EBRS and the EPG remain a source of critical support for non-domestic and domestic consumers across the UK. The measures in these regulations are crucial for the effective operation of the EPG and EBRS, and the schemes will complement other large-scale support that the Government are providing for energy and the cost of living. I hope that the Committee will support these measures and their objectives.

[Alan Brown]

On the EBRS, can it be absolutely clarified that the discount is applied to a bill before the non-domestic customers have to pay the money to the supplier, or is it retrospective?

[Ms Ghani]

I think the answer is yes to the former, but when I make my concluding remarks I will ensure that the answer is word-perfect for the transcript. Without further ado, I commend the regulations to the Committee.

--- Later in debate ---

[Alan Brown]

It is a pleasure to serve under your chairmanship, Sir Roger. As the hon. Member for Southampton, Test said, we understand the need for the regulations, because we all want to see support for businesses and people in our constituencies, but there is a reason why this is so back-ended. When Ofgem was predicting what the price cap would rise to in October, with the Tory leadership contest going on, the outgoing Prime Minister said that he could not tie the hands of the incoming Prime Minister, so nothing was done at a critical period when businesses should have been consulted directly and involved. Things could have happened much quicker. Although the outgoing Prime Minister sai that he could not commit money, he committed £700 million of taxpayers’ money for Sizewell C, which will add to our bills.

While researching today’s measures, I came across the Regulatory Policy Committee’s assessment of the various impact assessments that have been undertaken regarding the Energy Prices Act 2022. The RPC report is quite damning. It shows just how much of a rushed job this has been. It rated the impact assessments undertaken for the legislation before us as “not fit for purpose”. Overall, according to the RPC, two categories are classed as red, two as weak and two as satisfactory. One of the things that the RPC highlighted is the lack of an overarching or umbrella impact assessment covering all of the individual impact assessments associated with the Energy Prices Act 2022. Will the Government look at that, and do an overarching impact assessment so that they fully understand all of the different strands that are coming together in these support packages? Ultimately, we can consider this the Government’s flagship policy at the moment, in terms of supporting businesses and people with their energy bills. The EBRS package is estimated at £29 billion in the impact assessment, but if the impact assessment is not deemed fit for purpose the Government need to understand that and quickly, as this is now being rolled out with huge sums of taxpayers’ money.

The RPC also highlights another bigger issue about energy consumption and its impacts: if people or businesses are shielded slightly from the full impact of the energy cost increases, they will actually use more energy as a consequence. There is a risk there. Anybody who heard the previous Prime Minister say, “Nobody will pay more than £2,500” will wrongly think that that is the limit, and may use too much energy. What will the Government do to assess the impact of that?

On the bigger picture of energy security and supply, there is talk that we may have to ration electricity. The National Grid ESO is looking at how to balance the grid, if need be, and reduce demand. The Government need to understand that there is a possible impact on businesses trying to access energy, when they believe it is in their interest because they are being supported, versus the ESO trying to manage peak demand. The RPC say that that is not being looked at, and going forward it is something that the Government must address.

In a similar vein, have the Government considered what will happen if companies and businesses choose to ramp up their business operations toward the end of the scheme? The scheme ends at the end of March 2023, so what happens if a business decides to say, “You know what, I’m going to go gung-ho. I’m going to go flat out. I’m going to ramp up operations, I’m going to ramp up manufacturing. Let’s get as much done as we can, because the Government and the taxpayer are supporting our energy usage, then we’ll slow down come April and maybe give people holidays.” Will that be considered an illegitimate use of the scheme, or legitimate access that would be deemed sound business practice? If it is the latter, how will the Government manage that before it is too late?

Why is there not a greater assessment of the impact of administration and resource costs on Ofgem, which will be heavily involved in monitoring compliance? That does not seem to have been undertaken either. Another issue that the RPC identified concerns landlords. Paragraph 9 of the impact assessment for the EBRS intimates that there will be “pass-through requirements”, where any intermediaries or landlords have to pass on the discount and benefits to the businesses renting the premises. Let us say that a landlord does not do that with the pass-through requirements: what is the mechanism for the Government to take action? What is the enforcement mechanism, and how will the Government do that? How will businesses highlight that? What is the reporting process for reporting to Ofgem or the supplier for the Government to ensure that they get the full benefit intended in terms of energy support for those businesses?

Another key question that I am trying to get my head round is highlighted in paragraph 7.2 of the explanatory notes. If a company has outstanding debt on bills of greater than 28 days it effectively does not qualify. How does that work? If it has any debt with a supplier that it has not managed to address, does it fall out of the scheme altogether, or is that the case only if it is debt on a bill that has had a reduction applied to it? If it still has not paid, will it fork out for future reductions? That is partly why I asked earlier if reductions are applied to the bills, rather than being applied retrospectively, once companies have paid. I am still trying to get my head round what happens about that if companies have debt, because that will be critical. Obviously, companies might have debt now because of cashflow issues, but the worst thing that could happen to a struggling business is that it does not get the support that it should get. That could send that business under.

On page 5, paragraph 10 of the impact assessment, we learn that legislative powers will be utilised to ensure that suppliers “offer reasonable contracts” and ensure that reductions take place. Again, it is a noble sentiment for the Government to want to cover that, but how will that work in reality?

Turning to the energy price guarantee, our constituents who live off the gas grid have been promised £100. I have long argued that the £100 one-off payment is completely insufficient, when the minimum delivery fee to fill a tank is £500 and the cost of filling a tank has more than doubled to roughly £1,200, so people just do not have the money. I have been contacted by an 86-year-old constituent who lives in a rural area. She has two tanks that she has to fill two or three times a year. She is worried about how she will afford that. She does not know how she will get the £100, so it would be good to have an explanation about when the £100 will be disbursed and how people can access it, even though it does not make much difference overall in terms of filling fuel tanks.

What assessment are the Government making of what people’s future bills will look like? The explanatory notes for the Energy Prices Act 2022 said that the support package, which was a two-year package at the time, was to prevent bills going up to an average of £4,200 per household. We now know the EPG ends on 31 March. The Chancellor said that it would be brought back to help vulnerable people, but what will an average bill look like for typical householders going forward? That is a real concern. It is not an exact science and there will need to be estimates for a range of prices, but it would be good for people to have some sort of idea about what the future will look like, because they need to start planning for that.

Finally, Sir Roger, I want to mention another aspect of the Energy Prices Act 2022: the decoupling of renewable energy generation from prices based on gas. When will the Government come forward with timescales for supernormal revenue proposals? When will we start to see that take shape? Are the Government undertaking an open consultation with energy trade bodies and energy generators? The RPC points out that we need to ensure that they do not disincentivise investment in renewables. We also need to look at what the EU is doing and the impact that EU schemes are having on electricity generation in terms of renewables, and we must make sure the Government understand that and either mirror or improve the EU scheme.

[Ms Ghani]

I thank hon. Members for their valuable contributions to the debate and for their understanding about the speed required to ensure that support is available in Northern Ireland.

Fundamentally, we are trying to provide a wholesale discount that could halve people’s bills, and that is what we are here to do. It is reassuring to know that the schemes are already in force and are delivering support to households and organisations across the UK. I hope that will go some way to assure the public that the Government are committed to taking decisive action against this energy crisis. We are confident that our non-domestic schemes will seek to avoid firm closures and redundancies, and ensure that vital public services and charities can continue to operate over the winter.

The scheme has been designed to operate robustly, and it guards against fraud and gaming. We will continue to monitor the scheme to ensure that support is provided to the people and businesses it is designed to help. We are committed to reviewing the scheme. We will consider how best to offer further support to customers who are most at risk from energy price rises beyond April 2023.

I will do my best to answer all the very sensible questions that were asked. If I do not respond to them all now, be assured that I will make sure that the appropriate Minister’s Department puts everything in writing. I am also very keen to answer the questions raised by Mr Brown, who normally asks for my resignation. This is a rare moment when he has not.

[Alan Brown]

I’m just waiting.

[Ms Ghani]

I will come to Mr Brown first—

--- Later in debate ---

[Ms Ghani]

Forgive me, Sir Roger; my apologies.

As mentioned, the discount will be applied before the business is billed. Another point was raised about the 28 days in arrears. All eligible customers will be eligible for the EBRS discount. The arrears point applies only to the extra discount. Suppliers will apply those to deemed or out-of-contract tariffs.

A valid question was raised about landlords. The Energy Bill Relief Scheme Pass-through Requirement (England and Wales and Scotland) Regulations 2022 and the Energy Bill Relief Scheme and Energy Price Guarantee Pass-through Requirement and Miscellaneous Amendments Regulations 2022, which were laid before Parliament on 31 October and 4 November respectively, set out the requirements for intermediaries such as landlords to pass through the benefits of EBRS, the GB EPG and the GB energy bills support scheme to end users who, for example, pay for their energy through all-inclusive bills.

[Alan Brown]

I thank the Minister for giving way. What I was actually seeking was further clarity on the enforcement action the Government can take to actually ensure that that is happening and that those are being passed on. I am happy for somebody to write to me on that.

[Ms Ghani]

We will make sure that that is in writing. The regulations have been laid, but the hon. Gentleman is absolutely right; we want to make sure that those benefits are passed through.

A question was raised about the £100 payment, which comes on top of the £400 discount. This is what we are here to do today: to make sure that people have all the support they need. The regulations are here to support economic growth and ensure that firms do not close down and redundancies do not happen. The scheme is fundamentally there to support those people and public services. I believe that an impact assessment was published for the overall EBRS scheme across the UK, along with Energy Prices Act 2022. I will make sure that this is emailed to the hon. Member for Kilmarnock and Loudoun, as well, so that he can look at that.

Public Ownership of Energy Companies

Alan Brown Excerpts

Monday 31st October 2022 Westminster Hall

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is a pleasure to serve under you as Chair, Mrs Murray. I commend the petitioners. It is clear that we need a serious debate about energy, strategic assets and how the energy market operates. For too long, what has constituted a so-called debate in this place has been the argument that private is good, and nationalised or public sector is bad—or vice versa. Unfortunately, there does not seem to be too much debate today either: most of the speakers are in broad agreement. It prompts the question: where are all these compassionate Conservatives, bringing forward their views, sticking up for what is going on and putting forward other ideas? [Interruption.] I see that someone is pointing to the Minister from a sedentary position. I state the obvious: the Minister has to respond. We will get his point of view, but where are all the Conservative Back Benchers?

I commend my hon. Friend the Member for Linlithgow and East Falkirk (Martyn Day) for securing the debate on behalf of the petitioners. He spoke in a balanced way, while also highlighting the abject failures of this UK Government. My hon. Friend rightly pointed out that the free market has effectively collapsed and failed. There has been insufficient regulation over the years. He also said that, if there was a properly regulated market, the citizens of the UK would feel the benefit, and there would not be such high levels of fuel poverty. He highlighted that the problems were exacerbated by Chancellors coming and going, and Prime Ministers coming and going, and the fact that when the current Prime Minister was Chancellor, he had no idea of the scale of the problem. The then Chancellor tried to introduce a £200 energy loan scheme, which would clearly never address the issues that real people face as they struggle to pay their energy bills.

Another point that my hon. Friend made on behalf of the petitioners was the need for a 25-year strategic plan. I certainly agree. In the long term, we should be looking at how we get to net zero. What do we need to do to get there? Where should we build the generation facilities to facilitate that, and in the cheapest possible way? What grid upgrades will we need? What other measures should be implemented, such as energy efficiency and upgrading homes properly? That would be long-term planning, and it would realise the most benefit for people in the UK.

The hon. Member for Wirral West (Margaret Greenwood) effectively highlighted the dilemma that many people now have: heating or eating. Sadly, in some cases, they can afford to do neither, because they cannot even turn on their gas hobs to heat their food. She highlighted the failings in the design of the oil and gas profits levy, and the obscene oil and gas profits that are being realised. That was another common theme from speakers. The hon. Member rightly highlighted the success of smaller countries, such as Norway, Denmark, Iceland and so on, in public ownership and leading the way in the renewable transition. That is not lost on us MPs from Scotland.

The hon. Member for Leeds East (Richard Burgon) asked: who actually owns the energy companies at the moment? We keep hearing the UK Government talk about energy security, yet they are quite happy to have many foreign owners of our energy companies. That is a real paradox. The response to the last written question I tabled about the consortium building Sizewell C showed that China General Nuclear still owns a 20% stake. When will the Government realise that that partnership should be dissolved, and that they need to end their obsession with Sizewell C?

The hon. Member for Leeds East mentioned social pricing structure; I would call it social tariffs. Now is the time for that to be considered. We need layered tiers based on usage, because we all know that people on the lowest incomes use the least amount of energy, so they would benefit from that. We can also use social tariffs to protect the most vulnerable. It is much more progressive, because those who can afford to pay more for the energy that they use do so.

The hon. Member for Ilford South (Sam Tarry) made the final Back-Bench contribution, which started with eye-watering figures about the tragic consequences of fuel poverty. The reality is that fuel poverty kills people. Roughly 10,000 people a year die prematurely because they cannot afford to heat their homes. That is a national scandal that needs to be remembered. I would like the Minister to explain how the Government will address that, because we cannot let that scandal continue. Clearly, it will get worse, as fuel poverty rates have increased massively. Have the Government even assessed what that means for future excess deaths?

A year and a half ago, the so-called price cap was £1,100 per annum for an average household. Now people are expected to be grateful for the support package that the Government announced, which is equivalent to £2,500 per annum for an average household. My hon. Friend the Member for Linlithgow and East Falkirk highlighted the fact that the previous Prime Minister did not even understand her own policy. She kept stating that she was ensuring that people would not pay more than £2,500 for their bills. Average bills in Scotland are likely to be £3,300 even under the support scheme. That shows the gravity of her misinformation. Too many people will be under the illusion that their bill will be smaller than they actually will be. Frankly, it is dangerous for people’s financial management.

The Government’s own impact assessment for the Energy Prices Act 2022 estimated that the support package would prevent average bills from rising to over £4,400 come January 2023. The former Prime Minister was claiming that the support package would prevent energy bills from rising to over £6,000 per annum. Given that the UK Government made the last-minute decision to slash the support period, will the Minister advise us what he thinks Ofgem’s cap level will increase to for the 22 million or so dual fuel customers who are currently on standard variable tariffs when the support package ends in April 2023? When will the Government announce their plan to protect the most vulnerable, as they claim they will?

The reality is that more and more people are already in debt, and they have been put on to prepayment meters, so why is the Government’s support package not even contingent on not forcing more people on to prepayment meters, which have higher standing charges? National Energy Action estimates that with the current support package, there will still be 6.7 million households in fuel poverty. Can the Minister provide an estimate of how many people will go into fuel poverty come April 2023, when the support package ends? How many households do the Government think are vulnerable enough to merit further support, and when will we hear what that support package will look like?

Fuel poverty on this scale is why people are angry and want a more serious debate about the merits of nationalisation and putting people before profits. They know that the energy profits levy for oil and gas companies does not go far enough, and that the investment allowance of 91p in the pound perversely incentivises investment in fossil fuels over renewable energy. For too long in the energy retail sector, the excess profits being made by the big six were deemed acceptable by the Government. When they eventually moved to a price cap, the truth is that it came in too late, because by that time the market was being squeezed by new entrants that thought that they could come in and make easy money in the energy retail sector. Thirty companies have gone bust since July 2021 and many of them had been using customers’ money for their cash flow, effectively operating their own Ponzi schemes while the Government and the regulator were sleeping on the job. The reality is that, unfortunately, it is now billpayers who are picking up the tab for these losses and covering the customer credit that these companies effectively stole. Why has there not been stronger action to bring the guilty people in these companies to account?

The largest energy company to go into administration, as the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) pointed out, is Bulb, which has cost the taxpayer billions of pounds. What is the Government’s estimate of the special administration regime costs for Bulb? What we have seen in this energy market—and in the retail market in particular—is similar to what we have seen in other markets, particularly the rail market: profits are being privatised, but the debts and the risks lie with the people. How can that be a fair system?

While Bulb was in a special administration regime, its chief executive was still allowed to pick up his salary of £250,000 a year, supposedly for his expertise. That is the same man whose expertise took the company into administration. Only a Government who see raising bankers’ bonuses as a priority could think that that chief executive should have been kept in place with a £250,000 salary.

Another example of privatising profit while taxpayers take risks is something I touched on earlier—the Government’s obsession with new nuclear power. Hinkley Point C is nearly 50% over budget and EDF’s latest programme shows that it could be 2030 before both units are operating, which would be five years behind schedule. Yet the Government still tell us that replicating the world’s most expensive power station at Sizewell is the answer to our cost and security crisis.

It beggars belief that the Government want to give EDF a 60-year contract while moving the risk on to the bill payers under the regulated asset base model of funding. This is a project that the Government’s own impact assessment shows could cost £63 billion for capital and borrowing costs. We have a classic example of how the free market in nuclear energy generation has completely failed, yet the Government are stepping in to the market to support a fully nationalised French company and transfer the risk to UK bill payers.

What frustrates me is that Labour continues to goad the Tories to build even more nuclear power plants. It is groupthink madness and it is tying up future generations of bill payers to pay not only for these costly new power stations but for the nuclear waste legacy, which is already estimated to cost about £140 billion. How will that approach reduce bills in the future?

Switching slightly, if we look to Scotland we see that it provides an example of a nationalised utility company that has kept all its assets under public ownership: Scottish Water. Water and sewerage bills are cheaper in Scotland compared with the rest of UK water companies; comparative performance is better, as measured by the regulator; and of course any surpluses or savings are reinvested. By contrast, the privatised water companies south of the border have taken something like £60 billion in dividends since privatisation and, as we know, sewage discharges into rivers and seas by these private water companies are out of control. Will the Minister comment on the comparative success of the nationalised utility company in Scotland and say what lessons can be learned from that? In a similar vein, what assessment have the Government made of the dividends paid out in the energy sector over the years with regard to risk and balance, and whether the dividends paid by the energy companies have indeed been excessive?

When we look at the oil and gas industry elsewhere, we see what nationalised companies have achieved in returns for the benefit of their citizens. In Norway, Statoil generated profits for the citizens of the Norway while the Norwegian Government still took taxes and put some of that money aside in a sovereign wealth fund, which now sits at $1 trillion, making it the largest such fund in the world.

That energy company, which is now Equinor, operates in 30 countries around the world and has massively diversified into renewable energy. Although it was technically privatised, the Norwegian state is still the majority shareholder, with a 67% shareholding. It really is the ultimate success story, whereas in Scotland’s case, we know that by comparison the UK, with broad shoulders, has squandered all the oil and gas revenues—some £380 billion over the years.

Independence will allow the Scottish Government to create an investment fund that would invest in renewable energy; could be used to support the decarbonisation of homes; and could take stakes in renewable generation while also levering in private investment. The Energy Prices Act gives the Secretary of State powers to buy energy assets. Is that a nod away from ideological opposition to all forms of nationalisation, and can the Minister tell us whether the Government will be using those powers to buy some energy assets, for which the Energy Prices Act allows?

I have highlighted a lot of the benefits of having publicly owned assets—for instance, the success of Scottish Water—but I do not believe that now is the right time to renationalise energy companies in full. The amount of money to pay out is untold billions, and it will scare off future investors and the market. The only estimates on costings that I have found are from the Centre for Policy Studies which, I accept, is a right-wing think-tank—not necessarily one that I would normally utilise. The CPS estimated that it would cost something like £55 billion to nationalise transmission assets, but £185 billion to nationalise the entire sector. Those are eye-watering sums that might not be manageable in this difficult climate.

The same principle applies when Scotland becomes independent, because there is no point creating additional debt and investor turbulence. However, that does not preclude a Scottish energy company being set up and working in collaboration with the private sector on a mixed-equity basis to ensure that maximum investment is levered in, but also that the state gets returns for the good of the population and revenue streams that allow for reinvestment.

With independence, we can end the ridiculous situation whereby people in the highlands of Scotland pay a surcharge on their electricity bills while renewable energy generation in the highlands supports the rest of the UK. They are bringing down bills across the UK, while they pay a surcharge on their own bills. It is completely topsy-turvy and unfair, and it something that the Government refuse to address. Again, it is another inequity that only independence will resolve. Although Scotland is an energy-rich country, we do not yet have the powers to unleash our potential and create a fairer society, but I have a feeling that that day is coming, and I look forward to the response from the Minister.

[Mrs Sheryll Murray (in the Chair)]

Before I call the shadow Minister, I understand that people watching the debate online were unable to view the first 20 minutes. I reassure anyone watching that the full recording of the debate will be made available online later.

I call the shadow Minister, Dr Alan Whitehead.

--- Later in debate ---

[George Freeman]

I will deal with that point as I come on to explain our position on net zero and the extraordinary success that the market has had, with appropriate regulation.

[Alan Brown]

rose—

[George Freeman]

I would like to make some progress as I have hardly even got through my first paragraph, but I will give way.

[Alan Brown]

I thank the Minister for giving way again. On energy resilience and his point about harnessing the market, we know that energy resilience requires long-duration storage. That can be provided by pumped-storage hydro, a technology that already exists. SSE has all the permissions in place to build a new pumped-storage hydro scheme at Coire Glas. It will have 1.5 GW output. All the private investment is there—we are talking about harnessing the market, but the private investment is already there. All that is needed is for the Government to negotiate a cap and floor price mechanism for the sale of electricity. Will the Minister commit to having officials speak to SSE and other operators in the pumped-storage hydro market to bring these schemes forward?

--- Later in debate ---

[George Freeman]

No, I have had enough of giving way. All Members are doing is repeating the same points that we have already listened to, and I want to make some progress.

I will turn to the winter support for energy bills, which is a really important issue and relates to the second half of the petition. We are absolutely committed to reducing the impact on people’s bills of the terrible global events that I have described, including the impact of the war in Ukraine and of the reopening of the global economy after the pandemic. As this Prime Minister and the two previous Prime Ministers have made clear, we are absolutely committed to helping the British public through this, and we are taking action at an unprecedented scale.

First, our energy price guarantee will save a typical British household about £700 this winter. Secondly, that comes on top of the £37 billion package of support announced earlier this year, which will give all households circa £400 off their energy bills through the energy bills support scheme. That means a typical household saving about £1,100. Thirdly, we are taking further, targeted action to ensure that the most vulnerable can stay warm this winter: the UK’s poorest families will continue to receive £1,200 of support—including £400 from the energy bills support scheme—provided in instalments over the year, with additional support for pensioners and those claiming disability benefits.

Fourthly, the Government are investing more than £6.6 billion across this Parliament in critical work to improve energy efficiency and decarbonise heating. We will deliver upgrades to more than half a million homes in the coming years through our social housing decarbonisation fund, home upgrade grant schemes and energy company obligation scheme, delivering average bill savings of £300. Fifthly, we have extended the energy company obligation from 2022 to 2026, boosting its value from £640 million to £1 billion a year, helping an extra 450,000 families with green measures such as insulation.

Sixthly, it is not just households; we are also taking action to support schools, hospitals and businesses. Through the new energy bill relief scheme, the Government will provide a discount on wholesale gas and electricity prices for all non-domestic consumers in Great Britain and Northern Ireland.

This is not the free-market, laissez-faire, devil-take-the-hindmost economics that has been portrayed this afternoon. This is a Government taking huge and unprecedented steps—on a scale with those we took in the pandemic—to help families, households, businesses and charities to deal with the global cost of living crisis. Again, it would have been nice to hear some reference from Opposition Members to the immensity of that package.

I come now to energy profits—an issue that Opposition Members raised. We are not just cutting bills in the short term; we are thinking about how we can guarantee an affordable, clean and secure supply of energy for this winter and beyond. We have listened closely to the public debate about the profits enjoyed by energy generators thanks to high international gas prices. We have not just listened; we have acted. That is why in May we introduced a 25% surcharge on extraordinary profits in the oil and gas sector, which will raise about £5 billion over the next year. That revenue will support our support for those hardest hit by the rise in the cost of living and cost of energy.

We have brought forward primary legislation to give us powers to deliver a temporary revenue limit for renewable generation in the wholesale market. The details of that proposal will be set out in subsequent secondary legislation, and we are committed to collaborating closely with industry to develop it further. This will return a substantial amount of excess profits—profits made through the price surge—to consumers via suppliers.

[Alan Brown]

To get some sort of level playing field, why is there not a renewable energy investment allowance that allows tax write-offs for greater investment in renewable energy, when there is one for oil and gas. It just makes no sense if the Minister is talking about having a cleaner, greener system going forward.

[George Freeman]

I refer the hon. Gentleman to the facts as I have set them out. We are attracting billions of pounds of investment into clean energy—into a whole raft of new renewables. I do not think anyone would argue that the UK is struggling to attract international investment. What we need to do, which I completely accept, is not just to accelerate the deployment of wind and solar, but to continue to invest in the technologies of tomorrow to ensure that we are able to increase global and UK energy supply for a modern society and economy in a way that is clean, green and smart and that develops new jobs.

I am surprised that Opposition Members are not more excited by the opportunities in this sector for Scotland, which would be recklessly undermined by an uncosted, unthought-through plan for both nationalisation and independence, without credibility for how those plans are going to be funded. That is why our energy security strategy sets out a long-term plan for the whole UK that reduces our vulnerability to international energy prices by reducing our dependence on imported oil and gas.

We know that this is a very difficult time for families and businesses who are struggling, and that this issue is a matter of genuine public concern—as this petition rightly shows. However, I hope that I have reassured the hon. Members who are present in Westminster Hall and the constituents who they nobly represent that we are addressing this issue with the seriousness that it deserves.