Space Industry (Indemnities) Bill

Debate between Chris Clarkson and Anthony Browne

2nd reading
Friday 23rd February 2024 Commons Chamber

[Anthony Browne]

My hon. Friend has expounded a very important point: we are critical to the space industry, and to space exploration more generally.

Coming back to the issue of regulation—coming down to Earth from our big visions, the Clangers and so on—the Government have been funding the industry. We put in place the Space Industry Act 2018, which my hon. Friend the Member for Woking talked about, and appointed the Civil Aviation Authority as a spaceflight regulator—that is why I am answering this debate, as a Transport Minister, rather than someone from the Department for Science, Innovation and Technology. Getting into space and orbit is a DFT responsibility. The civil aviation regulator—which has licensed SaxaVord, for example—enables the licensing of spaceflight activities from the UK, such as operating a satellite in orbit, and enabling a launch to orbit from UK spaceports for the first time.

The Government recognise that the issues of liability and insurance are of the utmost concern to the space sector, and they are obviously the entire point of the Bill. The industry made clear in its responses to the consultation on the then draft space industry regulations in 2020, and in response to the Government call for evidence to inform orbital liability and insurance policy in October 2021, that holding unlimited liability will have an adverse effect on the UK space flight industry. People sometimes object to private Members’ Bills because they are not based on consultation, but this issue has been endlessly consulted on and negotiated with industry, and the industry is calling for this Bill.

The industry has advised that it is impossible, not just difficult, to obtain insurance for an unlimited amount. Members might ask, “Why is that, if the chance of something happening is infinitesimally small?” The reason is that it is impossible for the actuaries to quantify it; with infinity over infinity, one could come up with any value. Also, insurers are required by regulation to show that they have the capital to meet any claim on them. Clearly, insurers cannot have unlimited capital, so it is regulatorily and legally impossible for insurance companies to insure to an unlimited amount. It is very difficult for the industry to say to investors, “Please give me money to fund the launch of a rocket, even though I may not be able to insure it.” We need liability limitations so that launch companies and other space operators can get insurance, and so can get the investment that they need.

If a spaceflight company cannot get unlimited insurance, it obviously cannot get full insurance. As a number of hon. Members have said, if the Government did not limit a spaceflight operator’s liability, spaceflight companies and investors would instead look to more favourable regulatory regimes in other countries, where Governments share the risks involved by limiting an operator’s liability and offering a state guarantee. The United States already does this, as does France with French Guiana.

As my hon. Friend the Member for Woking has explained, there are powers in the Space Industry Act that we can and do use to limit a spaceflight operator’s liability when carrying out spaceflight activities from the UK. Government policy is that the regulator should use those powers and specify limits on operator liability in the licence, so that no operator faces unlimited liability. However, the law sets out that the Government “may” do that, rather than “must”.

The Government fully support the Bill for two key reasons. It is consistent with our policy that all spaceflight operator licences should have a limit on liability. It will not, therefore, impose any additional liability or risk on UK taxpayers. My hon. Friend made that point. The Government also recognise the value that the industry places on legislative certainty on this matter. As I pointed out, if investors are to make an investment in a space company, they need to know that the company will be able to get insurance. The report by the Taskforce on Innovation, Growth and Regulatory Reform—the TIGRR report, for short—published in May 2021, expressed concerns from the space sector over the use of the word “may” in section 12(2) of the Space Industry Act. The Bill would replace that “may” with “must”.

I thank all hon. Members for their contributions. My hon. Friend the Member for Wyre Forest (Mark Garnier) explained his great interest in space, and mentioned financial services, which I want to come on to. The point was well made that before the UK was a spacefaring nation, we were a seafaring nation. London was the biggest port in the world for more than 200 years, which led to a whole maritime industry with insurance around it, including Lloyd’s of London, and lawyers. We have a huge maritime industry in London as a result of having a maritime fleet, and we now have the same opportunity with space. We can have space investors—I have met some of them—as well as space lawyers, space insurance companies, regulatory experts and so on. It is a huge opportunity. The Government and the regulators need to ensure that the industry has the right incentives.

[Chris Clarkson]

The Minister mentions ports. Obviously, quite a few of our maritime assets are considered critical national infrastructure. Have any discussions been had on whether our space assets will also fall into that category? That applies particularly if we are to launch a 3D printer so that we can build on the moon, which is apparently the only place where the Liberal Democrats will not try to block house building.

[Anthony Browne]

My hon. Friend asks an interesting question. I will raise it with officials and come back to him with an answer.

My hon. Friend the Member for Truro and Falmouth (Cherilyn Mackrory) gave the most fantastic and enthusiastic speech about the space opportunities for Cornwall. I bet most people in Britain do not realise quite how important space is for Cornwall. There are 150 different companies; I had no idea that Cornwall had its own space lawyers, so that is a great insight. We also heard about the use of satellites for the maritime sector and various other issues to do with Cornwall. I want to make sure that my hon. Friend knows that as the Government Minister responsible, I fully agree that the Cornish launch, which was before my time as a Minister, was absolutely a success from a regulatory and investor point of view. I agree that the whole regime worked.

My hon. Friend the Member for Wyre Forest made the point that we in this country tend to overemphasise the negative, and we always look at the bad things that happen. I think I am right in saying that the first three launches from SpaceX did not get into space, but were actually seen as successes because they contributed to the whole launch operation. Lots of things were learned from those launches, and the same is true of the Cornish launch.

Motor Vehicles (Compulsory Insurance) Bill

Debate between Chris Clarkson and Anthony Browne

3rd reading
Friday 28th January 2022 Commons Chamber

[Chris Clarkson (Heywood and Middleton) (Con)]

Does my hon. Friend agree that one of the first positive signs of our new freedom post-Brexit is that we can start to reverse some of the impractical judgments that were made without the UK specifically in mind, which started, for example, with the Factortame case?

[Anthony Browne]

I completely agree. I declare another interest. I used to be Europe editor of The Times and I lived in Brussels for many years. I used to drive around across borders. If you drive for a couple of hours from Brussels you get into Luxembourg. Another half an hour and you are in Germany. Within 10 minutes, you can drive between France, Germany and Luxembourg: you are crossing borders the whole time. From that point of view, one can understand why one would want some co-ordination between insurance policies and so on. In the UK, we are an island. That is a very different position and different motoring rules apply. Often, the EU would have motoring rules, for example regulations on child seats in cars, that might have made sense if one lived in Luxembourg and drove into Germany and France every day and would not want to have the different regulation of child seats. In the UK, however, there is no particular reason why we should have the same regulation for child seats in cars as there is in, say, Poland.