Town and Country Planning (Electricity Generating Consent)

Debate between Alan Whitehead and Tom Blenkinsop

1st reading: House of Commons
Wednesday 4th May 2016 Commons Chamber

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

I beg to move,

That leave be given to bring in a Bill to make provision about the disclosure, consideration and approval of proposals for onshore electricity power stations of 50MW or less; to require the application of Engineering Construction Industry (NAECI) terms and conditions in certain circumstances; to require sector-specific collective national workforce agreements in other circumstances; and for connected purposes.

Any solid biomass or combined heat and power plant producing 50 MW or below—indeed, any power project producing 50 MW or below—does not come under the terms of national planning consent. Ostensibly that sounds fine, as it supposedly gives more control to local people about developments in their locality. Projects with a generating capacity of 50 MW and less are considered under the Town and Country Planning Act 1990 and can therefore be dealt with by local authorities.

That is where, for workers in the construction industry, the problems begin. Civil engineering and engineering construction are lifestyle choices that demand commitment, loyalty and hard graft. Workers more often than not work long hours under arduous and sometimes dangerous conditions to produce the end-product. However, all those great virtues count for nothing when the dice are loaded. From Teesside to south Yorkshire, from Scotland to Wales, there has been a recent epidemic of deliberate subterfuge to avoid and evade the industry standard for terms and conditions for construction workers in the power generation sector.

Locally, I and fellow Teesside Labour MPs, such as my hon. Friends the Members for Redcar (Anna Turley), for Hartlepool (Mr Wright), for Stockton North (Alex Cunningham) and for Middlesbrough (Andy McDonald), have been trying to unravel a complex knot of potential exploitation and undercutting. We have been working alongside the GMB and Unite the union at both regional and national level.

The sleight of hand employed and the deliberate use of opaque contractual arrangements via umbrella companies, which has seen workers paying their own national insurance twice, are known universally. Put together with potential undercutting and exploitation of migrant workers, they only frustrate an area and its people, who have seen massive privation in the light of closures at SSI Steel, Caparo Hartlepool, Air Products and Boulby potash mine, to mention just a few of the sites undergoing closure or job losses. That frustration has culminated in a year-long escalation of unrest in the construction industry fraternity, with mass protests outside the Wilton International site about the fact that the Wilton 11 energy from waste plant is being built on Teesside with a predominantly non-UK labour force.

Any MP considering the upcoming construction of energy from waste, biomass, or combined heat and power plant, must be aware that any individual project in or near their constituency that is under 50 MW will have achieved planning consent from a local authority. That consent will almost certainly not carry the necessary requirements of collective agreements, such as NAECI terms and conditions for workers in the construction of the project, which would also instil a level playing field for all at the tendering stages of the project.

Until now, the assumption has been that NAECI terms would carry over, but sadly that has not been the case. Owing to unscrupulous practices by certain construction companies, the lack of a voice in this growing market of power generation has led many who have been shut out of employment to take on board tactics that are born out of pure frustration and can develop into demonstrable anger. On 1 March and 7 April 2015, large numbers of construction workers took part in co-ordinated protests outside new biomass power stations in Rotherham, south Yorkshire, Port Talbot and Dunbar, and with the support of GMB, Unite and UCATT trade union members, they blockaded and disrupted work on those sites.

As a comparator for the injustice and undercutting of those unscrupulous construction companies, the rate under the national industry agreement should be between £16 and £64 an hour, depending on the skill of the role. However, the largely migrant workforce on those projects is being paid just €9 to €13 an hour—approximately between £7 and £10. With current levels of unemployment above the national average in the industry, it is no wonder that those workers are angry at the exploitation of migrant labour at the expense of local employment.

How can developers and employers get away with this race to the bottom? In Rotherham, for example, the local council gave planning consent in 2011, but sites producing under 50 MW have no legal provision for adherence to collective agreements.

The venture capitalists Brite Partnerships bought the site and then sold it on at a big profit to a Danish company, Copenhagen Infrastructure Partners. CI then contracted Babcock & Wilcox Vølund and Interserve to design, construct and operate the plant. In talks at its Birmingham office with GMB and Unite, BWV refused to allow the project to be included under the terms of the “blue book” NAECI national agreement. Subsequently, BWV sub-contracted the construction of the boiler to a Croatian firm called Ðuro Ðakovic TEP, which tendered to a lowest bid based on Croatian economic wage levels.

Ðuro Ðakovic TEP has form—very bad form. It is the same company that GMB and Unite caught underpaying its largely migrant workforce last year on the Ferrybridge Multifuels power station in Yorkshire. Because that job came under the NAECI independent audit facility, the unions were able to force the company to repay every euro that it owed its workers. However—sadly—the unions discovered only later from a worker via email, that when those workers got back to Croatia, the money was retaken from their wages under duress. Because the Rotherham biomass project and similar new waste-to-energy plants are not covered by collective agreements, and because they are under 50 MW, the employer can pay below the rate, and legally get away with it.

Well-meaning legislation from the European Union to try to combat such malpractice does not go far enough. Currently, it only gives workers who have been posted to work temporarily in another EU country the protection of the host country’s minimum standards, namely the minimum wage, not the industry rate such as NAECI. That is not the EU’s fault; it is our fault for not protecting the pay, terms and conditions of all workers at the trade union NAECI national agreed rate.

Without blanket collective bargaining for all workers, firms will use caveats to exploit them. Support of collective bargaining and of collectively bargained nationally achieved terms is the only solution to prevent the exploitation of immigrant labour, and a real tangible means by which we as a nation can prevent the deliberate social discord that is created among our own communities by effectively excluding workers in our towns from seeking and achieving meaningful employment.

We can achieve such collective bargaining, and also help local authorities that are under severe financial and logistical pressure, by ensuring at the start of the planning process—whether a power generation site is above or below 50 MW—that collective agreements such as NAECI “blue book” terms, and nationally agreed minimum terms, are adhered to by any company that is constructing on British soil. That must be clearly written within the contract.

Question put and agreed to.

Ordered.

That Tom Blenkinsop, Kevin Barron, Sarah Champion, John Healey, Andy McDonald, Anna Turley, Alex Cunningham and Mr Iain Wright present the Bill.

Tom Blenkinsop accordingly presented the Bill.

Bill read the First to be; to be read a Second time on Friday 13 May, and to be printed (Bill 173).

[Dr Alan Whitehead (Southampton, Test) (Lab)]

On a point of order, Mr Speaker. Have you received immediate notification of a statement by the Secretary of State for Energy and Climate Change on the admission by the chairman of Arriva in France that 400 dossiers relating to parts of reactors meeting required standards have been falsified, and on the extent to which those falsifications were present in the generic design assessment process for the operation of Arriva reactors in the UK?