Energy Prices Bill

Debate between Alan Brown and Peter Aldous

Committee stage
Monday 17th October 2022 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I am largely supportive of the Bill, as there is an urgent need for assistance to be delivered at speed to hard-pressed families and businesses, but it is important to avoid any unintended negative consequences for other key Government objectives, in particular energy security, the transition to net zero and the full deployment of renewables and low-carbon forms of energy production.

My constituents urgently need the support that the Bill will provide, but to regenerate the local economy and create long-term, well-paid jobs, we need investment in offshore wind, nuclear and hydrogen. There are exciting opportunities in the sector throughout east Anglia, and specifically Waveney and Lowestoft, although certain clauses in the Bill raise worries that such investment could be imperilled. I hope that the Minister will be able to allay that unease. The Government are not pursuing a windfall tax on renewables and nuclear generators because they are worried that it would deter investment. Some of the mechanisms proposed in the Bill could have a similar negative impact, and it is important that further clarification is provided quickly. I will briefly outline three specific concerns.

Clause 16, along with schedule 6, introduces the cost-plus revenue limit, which is a cap on the revenue of low-carbon energy generation. There is a worry that this mechanism could penalise investment in clean, cheap and low-carbon generation. To avoid that, there is a need for a reinvestment allowance to channel investment into low-carbon projects, which are needed to meet our net zero and energy security targets, and which will also provide the long-term route map out of the cost of living crisis.

Clause 21 enables the Secretary of State to modify the licences under which energy companies operate. Currently, the regulator Ofgem determines licence conditions. This is an arrangement that works well and has the confidence of investors. Further clarification is required as to the Government’s intentions, and consideration should be given to providing a definitive timeframe through a sunset clause for how long this provision will be in place.

Clause 19 sets out the arrangements for passing on the energy price support from generators to end users. There is a concern that the Bill as drafted does not properly take into account the fact that generators do not all operate in the same way and that they incur differing operational costs.

In conclusion, I hope the Minister can allay these concerns. I urge the Government to liaise and consult with all relevant stakeholders, including energy companies and civil society organisations, to avoid these unintended consequences, which could imperil energy security, decarbonisation and economic regeneration in coastal communities such as Waveney.

[Alan Brown]

It is a pleasure to serve under your chairmanship, Mr Evans, and to follow the hon. Member for Waveney (Peter Aldous). I very much expect that the Minister will not listen too much to my suggestions, but I hope he will listen to at least some of hon. Gentleman’s suggestions for making sure that we do not disincentivise investment in renewables and for amending some of these overreaching powers.

I would like to put on record my thanks to the Chairman of Ways and Means for selecting our manuscript amendment, new clause 18, which was obviously tabled in response to the Chancellor’s shock announcement this morning at 11 am that the UK Government’s flagship energy price guarantee policy, which we were told would last for two years, will now end in April 2023. People are already worried about the cost of living and the cost of the energy crisis, even with the support currently pledged, so many millions more will now be even more worried.

When the Chancellor gave his statement to the House later, he committed to at least some form of Treasury review in a modified scheme to protect the most vulnerable, but that in no way negates the merit of new clause 18. Given the mistakes and the recent track record of this shambles of a Government, it is surely in the House’s interest to set the parameters of a review and the considerations required for a new scheme post April 2023. The shadow Minister said that 28 days is too short a timeframe. I would argue that it is more than time enough for a Secretary of State to report back to Parliament and try to give households some certainty going forward.

Oil and Gas Producers: Windfall Tax

Debate between Alan Brown and Peter Aldous

Tuesday 1st February 2022 Commons Chamber

[Peter Aldous]

I thank the hon. Gentleman for that intervention. He may well be right, but that decision was made 55 years ago. Norway has, I think, far bigger resources than we do, and of course it is a much, much smaller population and country. So that is a debate for another time. I understand where he is coming from, but there is another side to that argument.

[Alan Brown]

The fact that Norway is a small independent country actually backs up Scotland’s argument for independence, does it not, considering Norway has a $1.3 trillion sovereign wealth fund?

[Peter Aldous]

I think we are actually on the same side of the argument here. Norway has done remarkably well and there are lessons to be learned. I was actually pointing to the fact that they have had that stable fiscal taxation regime, which has enabled them to be at the forefront of the drive towards a low-carbon economy.

The North Sea transition deal from last March has enabled the industry to deliver investment of £14 billion to £16 billion by 2030 in new technologies such as carbon capture and storage and hydrogen. While the supply chain of the oil and gas industry extends across the UK, activity tends to be concentrated on the North sea coast in north-east Scotland around Aberdeen, on Tyneside and Teesside and in East Anglia around Great Yarmouth and Lowestoft. These are coastal communities that have their own particular challenges and it would be very wrong to add to them at this particular time.

Off the East Anglian coast, there are exciting opportunities to promote a prosperous transition in the southern North sea by redeploying infrastructure and expertise from the oil and gas industry to create a leading hydrogen production and carbon capture, usage and storage hub around the Bacton gas terminal in the constituency of my hon. Friend the Member for North Norfolk (Duncan Baker). The energy price crisis presents many people with enormous challenges, and I look forward to scrutinising the Government’s proposals to address it, which will probably come forward next week. A windfall tax might, at first glance, be a compelling way of meeting that challenge, but it would have untold negative consequences.

Fisheries Bill (Eighth sitting)

Debate between Alan Brown and Peter Aldous

Thursday 13th December 2018 Public Bill Committees

[Peter Aldous]

The new clause sets out criteria for the allocation of fishing opportunities. I would like to place on the record my thanks to Dr Tom Appleby, who appeared before us in last week�s evidence session, for his work on drafting these proposed provisions.

As I have mentioned, clause 20 is a reworking of article 17 of the common fisheries policy, which seeks to incentivise better environmental practice. As currently drafted, the clause permits the Secretary of State to distribute fishing opportunities to the devolved Assemblies and English fishermen. There is a concern that it is too complex. The new clause splits those obligations into two parts, as the roles are subtly different�one is a UK determination and the other is a determination with respect to England only. There is also a concern that the way the clause was incorporated by references makes it difficult to read. The new clause seeks to improve on that.

The new clause provides the following. First, it provides a UK function in subsection (1) and an English function in subsections (2) and (3). Secondly, unlike other public assets, the nature of the public ownership of UK fisheries is not settled in legislation�we heard the reasons for that on Tuesday�although the courts confirmed in the 2013 case that has been mentioned at length that fish are a public asset. It is important that the nature of that public ownership is settled, as that would enable UK administrators to manage and dispose of the asset properly, with appropriate powers and duties being granted. It is proposed that ownership should take the form of a public trust vested in the Secretary of State in a similar way to other Crown assets managed by such organisations as the Crown Estate Commissioners.

Thirdly, the distribution of fishing opportunities would include social criteria as a means of tying in the joint fisheries statements and the Secretary of State�s fisheries statement. It would also include a means of rewarding better fishing practices. Finally, since the documentation recording the reasons for disposing of fishing opportunities to the commercial sector would involve the distribution of a public asset, there would need to be unequivocal transparency.

We examined in last week�s evidence sessions whether quota reallocation would leave the Government and the fisheries administrations exposed to legal threats. It is important to consider that question with regard to the new clause. In so doing, I highlight two issues. First, Greenpeace sought independent legal advice, which concluded that these changes would be compatible with domestic and international law and that

�a challenge to a new system of quota allocation enshrined in an Act of Parliament would be unlikely to succeed.�

That conclusion is based on two key points. First, the mandate for reallocation would be placed in a new Act of Parliament that overrides any common law and, after Brexit, will be supreme. Secondly, in the 2013 case, Mr Justice Cranston stated that in his view FQA units could be deemed as possessions falling within article 1 of the first protocol of the European convention on human rights�the right to property. He also said that FQA units had no value if no quota had been allocated or they were unused, and in any case the interference with the possession of FQA units was in accordance with law and was justified.

Taken together, these two points mean that in the scenario of mandating quota reallocation in UK law, as we are now considering in our discussion of this Bill, this is compatible�

[Alan Brown]

Will the hon. Gentleman explain how his new clause would work in terms of the devolved Administrations and how they manage their quotas?

[Peter Aldous]

I thank the hon. Gentleman for that point. The intention is not to interfere with that management through the current devolution settlement, so I do not think that he has a particular worry on this issue.

[Alan Brown]

I accept that the hon. Gentleman says that he is not seeking to change the devolved settlement; it is just that the new clause lists the Scottish Ministers. That is why I am trying to understand how it would work practically in the future.

Fisheries Bill (Fourth sitting)

Debate between Alan Brown and Peter Aldous

Thursday 6th December 2018 Public Bill Committees

[Peter Aldous (Waveney) (Con)]

Q Griffin, you have talked in quite a lot of detail about the reallocation of quota. From my perspective, representing a community that is a have-not, shall we say, that is music to my ears, but I am wary of the legal implications of that. I agree that fishing is a public right, but as we have heard in our evidence sessions, by ill fortune or bad management, it has acquired certain proprietorial rights. How far, legally, do you think we are able to go? The important thing is that this Fisheries Bill must be determined and made by this House, not by lawyers.

Griffin Carpenter: Absolutely. I am not a lawyer—I am an economist—but the legal advice I have heard is that the use of a notice period goes a long way. I mentioned the international examples. We have to make some claim on FQAs as a public resource. Where you might get buy-in for this across the whole sector, including the large-scale fleet, is on something such as flagged vessels. When you hear about Spanish vessels in UK waters, they are almost never Spanish vessels in the sense that they have a Spanish flag and are fishing the Spanish quota; they have purchased UK fishing vessels and are fishing with UK quota, and a lot of coastal communities do not like that. For example, in Wales, most of the quota is caught by those vessels and either landed in Ireland or taken straight to Spain.

The problem is that, if you want to address this issue of flagged vessels—those who are foreign nationals but have UK quota—you must do so by saying, “FQAs are a public resource and we are going to take that away from you and then revisit the issue of distribution.” In a political sense, you can get buy-in for that idea. In a legal sense, I get that the notice period goes a long way. We heard the point made this morning that, because this is new legislation, some of the case law around the previous FQA distribution under the common fisheries policy might not apply. I am actually not sure about that.

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

Q Sticking to the quota theme, you have already touched on the debate between this being enabling legislation and how much detail needs to be in the Bill. Do you think there needs to be more on how the quota allocation will work in future? You also mentioned potential quota reserves for new entrants—small-scale recreational anglers have also been mentioned—so is it your view that there should be more in the Bill?

Griffin Carpenter: I think that is a political question. I understand the idea that it is enabling legislation and that for most fisheries legislation all the detail will come in secondary legislation, but if you have some priorities that you absolutely want to ensure are in future UK fisheries, here is an opportunity to introduce them. I understand that some of the ideas we are discussing might be incongruous with the tone, at least, of the rest of the Bill, but here is an opportunity where we can say, “Starting now, we are only in 2018 and we are already thinking about this issue. We are guaranteeing it is in the fisheries legislation, first and foremost.” From a political perspective, that is valid.

Fisheries Bill (First sitting)

Debate between Alan Brown and Peter Aldous

Committee Debate: 1st sitting: House of Commons
Tuesday 4th December 2018 Public Bill Committees

[Peter Aldous (Waveney) (Con)]

Q I have two questions. Do you think the Bill will lead to increased fishing opportunities both for new entrants and for what until now have been called the under-10s, although I think it is important we try to get away from that descriptor? Picking up on the Minister’s comments about equal allocation across all UK fisheries for all UK boats, do you think that principle lies comfortably with the sustainable management of individual fisheries? I say that because there is a concern that it is difficult to do that when you get boats from other parts of the UK coming into waters off the East Anglian coast, and not only off the East Anglian coast. It is a concern that has been raised with me about waters off the north-east. Yesterday I was hearing about problems with managing cuttlefish down off the south-west where this problem had arisen. I would welcome both your views on those two issues.

Barrie Deas: On increased fishing opportunities and how they could be allocated, for a number of reasons, including case law in the English courts, but also the stewardship that comes along with rights of tenure, which have been an important factor in stabilising our fisheries over the last 20 years, our federation takes the view that for existing quota it should remain the same, but for additional quota we think there is a conversation to be had on the most appropriate use of that. There is a range of options.

Perhaps we are being a bit narrow here. You alluded to the division line at under-10, which has, I think, caused distortions in the fleet and unintended consequences —you have a cohort of high-catching under-10s, sometimes called rule beaters or super-under-10s, that have kind of distorted fishing patterns. There is recognition that we need to move beyond that now. In that context, there is an issue about how you define genuine small boats—genuine low-impact vessels—and I accept that. My organisation would be very interested in taking them out of the quota system altogether. That does not mean not taking into account their contribution to mortality. In a sense, it is a reversion to what we had in the early days of under-10 metre management, where sufficient quota was allocated and we did not have to have monthly quotas for that class of vessels. There is a very interesting conversation to be had about the future and new entrants and how the genuine low-impact fleets fit into that.

Equal access has been an important principle and there are dissatisfactions wherever you have a nomadic fleet arriving on the doorstep of a local fishery. That would be true of our boats fishing in bits of Scotland, I suppose, and certainly you hear these kinds of things about Scottish boats fishing off the Northumbrian coast or down in the south-west. Fishermen are competitive. They are competing with each other as well as with foreign fisherman. That is the context in which you have to situate that particular issue.

Bertie Armstrong: Mr Aldous, your question was about new entrants in under-10s. The enabler for a better deal for new entrants in under-10s will be the uplift in opportunity for fishing that comes with Brexit; otherwise, we presumably have fixed the problems already with the fishing opportunity available. The situation is different as you go around the coast. The small-vessel fleet in Scotland has a different character and tends to use creels, or pots, to catch shellfish—that is a great generalisation; there are others—so there is a different set of problems. It is generally inshore and small scale and is therefore best sorted out locally, but I think there will be a better deal for all with the uplift in opportunity.

There is another abiding principle here. If you are going to make alterations to arrangements for fishing, the fish need to be there to be caught. It is one thing to give someone tons of fish; it is quite another if the fish are not there in prime condition with a business plan for getting them landed and into a logistics chain. Much is made of the big mackerel catchers in the pelagic fleet, and much is made of rather lurid statistics about what percentage is held by what number. You cannot catch 250,000 tonnes of mackerel in winter, 100 miles to the west of the British Isles, with hand line under-10s—you simply cannot. But a few hundred tonnes to the hand line under-10s, provided the local arrangements pay attention to making sure there is a whole logistics chain and they are going to get that fish to a place where somebody wants it, is where the opportunity lies.

My final input, on behalf of slightly larger-scale fishing, is: be careful what you mean by low impact. The carbon footprint per kilogram of fish of a pelagic trawler catching mackerel is very much smaller than any other form of fishing, because you catch volume efficiently and quickly. There are many aspects to this.

In answer to the question, yes, there is extra opportunity, but there has to be extra opportunity to distribute. The problems are largely regional and should be sorted out regionally. We need to be careful not to place excessive detail on the face of the Bill. I suggest that a lot of this is best done by secondary legislation.

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

Q Mr Armstrong, in answer to an earlier question you suggested that we might see a date of what you called sovereignty over quotas and waters. You suggested that the end of the implementation period as it is now—December 2020—was the ideal date. How does that square with the fact that there may be a backstop arrangement and the Prime Minister has said that, depending on what happens, we might need to extend the implementation period? How would inserting a date in the Bill work with the other flexibilities that are still to be resolved?

Bertie Armstrong: I would wish to dispense with the flexibility to extend for fishing the implementation period by placing a date on the face of the Bill. There will undoubtedly be some resistance, but that would not be up to me. That is why we would like to see that in there. We are on record as being less than completely happy that the implementation period applies to fishing at all, because legal sovereignty over the waters and the resource therein comes on Brexit day. However, we are where we are, and we recognise that the withdrawal agreement has compromises all over the place. We therefore, with reluctance, accepted the implementation period compromise, but we would not wish to see it extended at all.

The backstop has been much described, particularly over the last few days. Clarity is helpful on what happens. There are two preconditions: if the backstop clicks in and is applied and there is no fisheries agreement in place by that stage, and there is no prescription of what is in the fisheries agreement, tariffs will apply. Fishing will be cherry-picked out of the trade arrangements. Tariffs will apply to fish—which, by the way, the Scottish Government study indicates would not necessarily be a terminal problem—and access to our waters for other UK fleets would cease. So it would be a mess of large proportions and we are rather hoping that it would not apply.

I see some puzzlement about the lack of access for anybody else. If there is no fisheries agreement—and there is precedent on this, with EU-Norway arrangements, for instance—there is no access to each other’s waters.

Fisheries Bill (Second sitting)

Debate between Alan Brown and Peter Aldous

Tuesday 4th December 2018 Public Bill Committees

[Peter Aldous]

Q I will not comment on pulse fishing, because I agree with you, Mr Brown. I think the Minister said that the Government are happy to look at an effort-based pilot. I am conscious that there was a pilot in the past. What was the outcome of that? What shortcomings were there, and what lessons might we learn for future pilots?

Aaron Brown: That is one of the areas where, when we devised this system, we realised there had been a massive failing. The days at sea scheme was blunt and there was no effective monitoring. Generally, it was with smaller boats in south-east England. I think even the fishermen themselves would hold their hands up and say they really knocked the backside out of the pilot. There was mis-reporting going on—they just went out and kind of went Tonto on it.

We are advocating an hours-based system. You would obviously have vessel monitoring systems. We want to get towards a fully integrated monitoring/management system. Vessels would have sensors, which are not expensive to put on—vessels use a similar technology for gear telemetry and door sensors—and go on any type of fishing gear, to monitor soak time, so you would know the exact time a vessel’s gear was in the water. There would be a stipulation to monitor where vessels were through your inshore VMS or your full-on VMS, and also to fill out electronic logbooks, which are here now. You would get an up-to-date, haul-by-haul update on how much fishing effort was going in. You would know, “That boat towed six hours in this area and he caught x amount of fish for this size of gear. The chap over to the side towed similar gear and caught half the amount of fish.” You would start to know where the abundancies were.

The one main control to go for with a pilot is making sure it is rigorously enforced and it is an hours-based scheme. The other main thing is the catch composition thing. That really is the main control for regulating the industry. Rather than everybody going Tonto, like they did last time, and targeting Dover sole, cod or bass, you would say, “Yes guys, you can catch them and keep them, but be aware that if you do that, your ceiling of hours is going to come clattering down to meet you.”

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

Q I think you touched on this topic earlier on; you said you would probably come on to it. Do you have a view on the discard prevention charging scheme that is in the Bill and on how transparent it is and how it would actually work?

Aaron Brown: That is one of the things in the Bill that very much seems to ride coach and horses over the idea that the Bill is just an enabling Bill. Obviously, there is a bit of reticence—okay, you could say, “Understandably so”—to career on towards a different type of management on an effort-based system, yet somehow we have a scheme here that has dropped out of the air, with no prior piloting and no prior consultation, and that has just arrived on the table. We are vehemently against it, because we personally feel—and everybody who has read the Bill, both among our membership and in other organisations, feels—that only an idiot who could not understand the practical implications of such a scheme would propose it.

We feel that the scheme is there to administratively abrogate the failings of the current system. The Government are proposing to take all the repatriated resources and use them as headroom to avoid choke species, whereby, as of 2019, vessels have to cease fishing on the exhaustion of their lowest quota. What will happen is that you will have vessels going to sea. Many hon. Members are from the south-west, as the Minister is, and haddocks are a huge problem there—in the North sea, it is hakes. The Government then say, “We will honour the fish that would choke you or would tie you up. We will give you fish to keep fishing, but so that there is no economic incentive to target that species, you must land it for free.” That scheme effectively creates a giant shuttle service, where boats are going to have to run in and out, in and out of harbour, landing all this fish that they cannot profit from, to allow them to keep fishing.

The first big problem with that scheme is retention of crew. Lads are not going to work to retain—well, just now it is a 40% discard rate, so if they have to retain that 40% for free, you are going to lose your crew very quick. The next problem is that there is no provision in the Bill as to what happens to this fish when it is landed: you cannot turn around and allow processors, hauliers, markets or shore-based people to profit from it, because that would disadvantage the fishermen. Really, the logical question about that clause is, “Are we going into some sort of Soviet system, where the fishing industry is going to work for free for the Government?” It is an ill-thought out thing, and I think it needs taking out of the Bill. It needs to come back once it has been properly tested and run in to see if it actually works, because we see such pitfalls in it, and it does not actually—