Retained EU Law (Revocation and Reform) Bill

Lord Mackinlay of Richborough Excerpts

2nd reading
Tuesday 25th October 2022 Commons Chamber

[Mr Rees-Mogg]

I know from my previous experience that His Majesty’s Government will observe the Sewel convention in relation to this. There may be occasions on which, for simplicity, the devolved authorities want the Westminster Parliament to move ahead with something on which everybody agrees, but what is devolved is devolved and the devolved Administrations will have the right to pursue it.

This Bill is not only one of constitutional importance that will get our statute book tidied up but one of massive opportunity. It presents an opportunity, not necessarily to do any one big individual thing—like the Financial Services and Markets Bill, which can change Solvency II involving billions of pounds for the economy—but to go through every single individual issue in detail, one by one, so that we can see, bit by bit, those rules that have made our businesses less competitive, those regulations that have put our businesses under more pressure and those intrusions that have made people’s lives less easy. We will be able to sweep those away, and we will be doing so in a proper constitutional process.

[Craig Mackinlay (South Thanet) (Con)]

My right hon. Friend previously served on the European Scrutiny Committee, as I still do. Does he recall the inches-thick paperwork that used to land in front of us on a regular basis? Despite the pleadings of the Chairman, my hon. Friend the Member for Stone (Sir William Cash), that legislation never had any debate, and even if it had, there was little to nothing we could do about it. This is the true victory and the Brexit dividend that we can now face.

[Mr Rees-Mogg]

My hon. Friend is absolutely right. The ports directive was debated and debated, and opposed on both sides of the House, but it went through anyway. There was absolutely nothing we could do. This is why I challenge Opposition Members who say that this is not proper scrutiny. Why did they not object to the section 2(2) power? Why were they not joining my hon. Friend the Member for Stone on the European Scrutiny Committee to ask, week in and week out, why these laws were going through without anybody being able to gainsay them and why parliamentary sovereignty was not being upheld? We are restoring parliamentary sovereignty by ensuring that there is a parliamentary process, that Parliament will have its say and that we will have our own law for our own country.

Ban on Fracking for Shale Gas Bill

Lord Mackinlay of Richborough Excerpts

Wednesday 19th October 2022 Commons Chamber

[Craig Mackinlay (South Thanet) (Con)]

We often wonder why we in this House are not taken very seriously. I will tell Members why. We are in the depths of an energy crisis. We have shown ourselves—Europe as a whole—to be too reliant on a dictator who has been conducting an illegal war, and the problems have come home to roost. Here we are speaking about trying to ban a source of domestic energy while we are short of it, and we wonder why people out there think that we are stark staring mad.

Of course, today’s debate is not about fracking—it is not about fracking at all—but about taking control of the Order Paper. We have seen that before during the height of the Brexit wars. My dear friend the right hon. Member for Leeds Central (Hilary Benn) was part of that. I am really sorry that the right hon. Member for Doncaster North (Edward Miliband) is not in his place. I did try to intervene on him, but he did not show me the courtesy of taking my intervention. If he had been in his place, I would have shown him that courtesy now.

There are a couple of things that need to be said. It has been said here that fracking will make no difference to the price of gas. I do not know about anybody else in this House, but when I did O-level economics, the first week—no, probably the first lesson—taught me that if we put more supply of something into a system, the price tends to come down. Further than that, even if Labour’s economics are true and the price will not change, would one rather spend tens of billions of pounds per year on foreign imported liquefied natural gas, even at a high price, or spend that money at home? That is a very clear decision.

[Wera Hobhouse]

Will the hon. Gentleman give way?

--- Later in debate ---

[Craig Mackinlay]

No, I will not give way; I do not have time today, and others have not done it for me— [Interruption.] Oh—yes, if the hon. Lady will please intervene, it gives me another minute.

[Wera Hobhouse]

Has the hon. Gentleman not listened to his own colleague, the hon. Member for Fylde (Mark Menzies), saying that it would take at least two years to get any fracking going, or to his other colleague, the right hon. Member for Spelthorne (Kwasi Kwarteng), who said just a few weeks ago when he was still Business Secretary that no amount of fracked fuel in this country would make a difference to the global gas market, because the quantities are too small?

[Craig Mackinlay]

I thank the hon. Lady from the Liberal Democrats for that point. I remember a former leader of the Liberal Democrats saying, about 12 years ago, “What is the point in nuclear?” because it would take 11 or 12 years to get it on stream. I think that 10, 11 or 12 years on from 2010 would be about now, and that would have been quite useful. Of course, it will take time to get fracked gas out of the ground. The best time to have done it was a few years ago; the second-best time to think about it is now.

I refer hon. Members to a House of Commons Library report dated 14 January this year, called “The energy price crunch”. As ever, House of Commons Library reports are excellent, and this one was very clear. Table 4.2 shows a very easy chart, which I will describe to hon. Members. It shows the output of UK-produced gas from the North sea, which peaked around 2004, when we were net exporters of gas. Since that time, we have been using only about 75% of that peak usage, and that may be for many reasons. We may have better-insulated houses, and that is to the good. I feel pretty sure that one of the main reasons is that any energy-intensive business has simply offshored somewhere else, but let us put that aside.

What has happened, very distinctly, is that we are now only producing one third of what we did at peak. We are using 25% less, but we are producing only one third of what we once did. Where do people think that gap is being filled from? That gap is being filled from international resources. There are three countries alone, forgetting Norway: £64 billion we have spent over the past 10 years on importing LNG from Russia, Qatar and the United States.

Surely it must be better to have those tens of thousands of jobs at home, as well as the many billions in investment and the profits and tax revenues—remember those? They are pretty helpful; they pay for things such as the NHS, or perhaps the insulation that we would all very much support. What would also be quite useful is balance of payments, because we have always run a pretty bad show on that. But if CO₂ is your thing—it is certainly my thing—why are we importing LNG and emitting 5 million tonnes of extra CO₂ just in the process of importing it, rather than doing it domestically?

This debate is a valid one—it is happening for other reasons, which we are all very aware of, as shown by Labour—but I support fracking. Let us give it a go. There is no Government money involved; it is all private.

Shale Gas Extraction

Lord Mackinlay of Richborough Excerpts

Thursday 22nd September 2022 Commons Chamber

[Mr Rees-Mogg]

I am not seeking to upset the devolution settlement.

[Craig Mackinlay (South Thanet) (Con)]

Even before Putin’s illegal war in Ukraine, fracking had advantages because of the benefits for jobs, for investment, for tax revenues and for the positivity of the balance of payments, which I would rather were accruing here in the UK instead of our sending tens of billions to Qatar and other places. Is my right hon. Friend aware of the carbon dioxide savings from domestic energy supply? It has been calculated that 5 million tonnes of CO₂ are emitted just from the cooling, declassification and transport of liquefied natural gas. That has to be a moral outrage.

[Mr Rees-Mogg]

My hon. Friend is absolutely right, and he takes his argument through logically, unlike many Opposition Members. If we wish to reduce carbon emissions, we are better off using gas as a transition fuel that comes from our own resources, rather than importing it. That must be true: we have those resources, we need the transition fuel, and therefore we should try to extract it domestically.

Employment Agencies and Trade Unions

Lord Mackinlay of Richborough Excerpts

Monday 11th July 2022 Commons Chamber

[Craig Mackinlay (South Thanet) (Con)]

It is always a pleasure to follow many of the Members in this House, and the hon. Member for Easington (Grahame Morris) knows I have great regard for him. I am glad that he discussed issues of the here and now—the P&O issue united the House in opposition to the behaviour of that employer, and it certainly meant a lot for the community of my hon. Friend the Member for Dover (Mrs Elphicke) —but I was somewhat entertained when he started to go on about indentured labour. I thought we had gone back not to the 1970s, which is part of this debate, but to the 19th century. I found that quite entertaining.

There are two usual ways of getting new staff into businesses, and we are discussing whether they can cross a strike action. Currently, a normal employment business is the one that cannot provide. The other type of employment business—the employment agency model—can. I do not think that I would much know the difference, if I went inside an employment business or an employment agency. At the end of the day, it is the staff that the business wants.

Much has been said about whether this change is being made on the back of the recent strikes. Well, perhaps it is. I have had so many emails from people who could not get to work on that day. We in this House had great inconvenience, which I am afraid was not assisted by possibly the worst London Mayor we have ever seen. I have local residents who have suffered fines because they rarely drive in London; they had to face the ultra low emission zone charge, box junctions everywhere that they could not get out of because of the chaos on the roads, and the local traffic networks that had closed much of London in the first place. We are into fairness. Is that fair on people who are trying to get to work and who usually rely on trains—trains that have had £16 billion of taxpayers’ money over this period, and not one job lost? Is it fair on everybody who is just trying to do the right thing: to run their own business, get to a hospital appointment, get to the doctor, or get to their exams?

I have every regard for the trade unions, but they have intentionally used the cost of living crisis—I do not blame them; best of luck to them—to get more than most people would ever be able to get. Let us not go back to the 1970s wage-price spiral. The hon. Member for Easington said that people’s wages will go backwards. Well, they will go backwards every year if we end up with a wage-price spiral.

[Alec Shelbrooke]

As I said in my speech, some of the wage demands are inappropriate. To put them into context, given the way in which MPs’ salaries are set with the raise in the average public sector pay, if all these wage demands were to go through, we would get an £8,000 pay rise next year. How does my hon. Friend think the public would react to that?

[Craig Mackinlay]

I thought about such issues when I was drafting my speech. There would be absolute outrage from the public if we were to get such pay rises. I do not particularly want such a pay rise; I assure hon. Members of that. We must guard against a wage-price spiral. I support these regulations, because it is not unreasonable for people to be able to get to work.

The other industry that was going down this route was British Airways. BA workers have come to a settlement, which is very good. If BA had effectively closed down over this holiday period, what would that have meant for the employment of London? What would have happened to the tourists who spend a lot of money in London and other tourist areas around the country, including in my own coastal town? What would that strike at BA have done?

I am glad that the dispute has been settled, but it seems to me that unions are picking off certain industries in order to cause the maximum upset, with little regard for normal people trying to go about their normal business. I have every respect for what unions are trying to achieve. That is what they are for, and they have done marvellous work in the past. At this time, however, we need to pull together as a nation—I really wish that we could pull together as a nation.

I have heard from those on the Labour Front Bench. I have heard from my friend, the hon. Member for Glasgow South West (Chris Stephens), who raised the spectre of danger. He knows very well that these industries are so regulated and that the staff are so qualified that the reality of agency workers being able to carry out this work is pretty low, so he is raising a spectre of something that does not really exist.

I am supportive of these measures. I hope that they do not need to be used. I hope that we can get common sense, get people back to work and get some of these disputes settled.

Shale Gas Production

Lord Mackinlay of Richborough Excerpts

Tuesday 15th March 2022 Commons Chamber

[Greg Hands]

The hon. Member raises a very good point and a strong point. In terms of what defines something as being cheaper, there are different ways to cut that. It will depend on what the prevailing prices are of alternative sources of energy. He will know that, for example, gas prices are more than 15 times their five-year historic high, so much depends on what the other prices are out there. But as I said earlier, a strategy will be launched by the Government before the end of the month, which will address a number of the different questions in terms of where our energy supply will come from in future years.

[Craig Mackinlay (South Thanet) (Con)]

Diverse organisations such as the Climate Change Committee and the Net Zero Scrutiny Group, which I chair, agree on one thing: gas will be part of our energy mix to 2050 and beyond. That makes domestic supply a very sensible endeavour. I just put the benefits to the Minister: 75,000 potential jobs; tens of billions of investment; billions in terms of tax revenues; massive savings of CO₂ compared with LNG inputs, which are truly horrific on CO₂, given that they come in on a diesel ship; and the balance of payments positivity. Is there anything in that list that my right hon. Friend disagrees with? Finally, I implore him to send a note of thanks to the US Government who took the dash to shale gas extraction some time ago and it is on the back of that that they have mitigated a lot of our energy failure.

[Greg Hands]

I thank my hon. Friend for his question and for his continued interest. I am always happy to meet with his group to discuss these issues. He is absolutely right: domestic supply is very important. This is not the time to be wanting to increase imports of foreign LNG. That is one reason why we want to see a robust UK continental shelf producing UK natural gas. The point he makes about investment, jobs, tax revenues and so on would be considered in the round, but I point out the earlier point about seeing the scientific evidence first and the local community support as well.

Draft Trade Union (Levy Payable to the Certification Officer) Regulations 2022 Draft Trade Union (Power of the Certification Officer to impose Financial Penalties) Regulations 2022

Lord Mackinlay of Richborough Excerpts

Tuesday 25th January 2022 General Committees

[Paul Scully]

The certification officer’s work will be charged accordingly, and the levy will be distributed at a level that is capped for each union and employers’ association. It will be for the certification officer to demonstrate what she has been doing in that regard and how those costs are broken down.

In response to requests by trade unions during consultation, two fees will be preserved—the fee for listing as an organisation and the fee for a union to be granted a certificate of independence. The costs of dealing with those applications will not be recoverable under the levy.

I recognise that these are significant changes for the organisations involved, albeit that they are the clear and required implementation of the Trade Union Act 2016. That is why we announced the reforms in June 2021, to allow trade unions and employers’ associations time to prepare before they are implemented in April 2022. That also allowed the certification officer time to put the systems in place to determine and charge the levy.

[Craig Mackinlay (South Thanet) (Con)]

I declare that I am a member of the Institute of Chartered Accountants in England and Wales. That body does similar things to those that a union might do: it represents its members, makes representations to Government and ensures that the regulated activities that we undertake as members are properly monitored and controlled. There has never been any issue that the Government should somehow pick up the bill for those things—

[Chris Stephens]

The taxpayer.

[Craig Mackinlay]

Or the taxpayer, absolutely. So I am quite surprised that there is huffing and puffing over this. The Minister has made it clear that 2.5% is the maximum. Has he calculated whether, if that 2.5% maximum levy, which I doubt will apply in many cases, were applied across the income of all the trade unions that are registered, it would cover the true cost of the certification officer’s work, or would there still be a shortfall that taxpayers were expected to make up?

[Paul Scully]

My hon. Friend makes some good points. As I say, there are exceptional cases when the taxpayer will be paying, in terms of the consultants that the certification officer may pay and the legal advice that she may require, because that will give unions and employers’ associations the certainty that they need. That is part of the proportionate approach that we have taken. None the less, the distribution that I have here, which I can share with the hon. Member for Bradford East, who asked about it earlier, assumes an estimated total levy of £1.15 million for the next financial year, based on the work that the certification officer has been doing.

--- Later in debate ---

[Imran Hussain]

Again, a point well made that needs no further explanation by me. The value of our trade unions is a good point—again, Government Members are nodding. They accept the value of the trade unions. I do not think that there is a debate about that.

To go back to my point, in imposing the levy, the Government have deliberately misunderstood the role of trade unions, treating them not as a voice of working people but as profit-making companies. Let me be clear: this Government know full well that trade unions do not exist to make profits for themselves; they exist for the betterment of their members and the workforce as a whole in this country. I have already made this point, but given that we would not think to force charities to pay such a high levy to the Charity Commission, it is frankly outrageous to ask the trade unions to do so.

The Government have also failed to set out a real case for why they need to impose the levy. As democratically accountable organisations in their own right, trade unions have high compliance rates with their legal duties. As my hon. Friend the Member for Newport East pointed out, the certification officer dealt with just 34 complaints against trade unions, not one of which ended up with an enforcement order being pursued.

The reality is that if this draft statutory instrument passes, trade unions will have to meet the costs—my hon. Friend made this point—of politically motivated, malicious, vexatious and unsubstantiated investigations into them. Those investigations will almost certainly be initiated by those who have long-standing opposition to our trade unions. That is why we must vote the instrument down today.

[Craig Mackinlay]

The hon. Gentleman is making an impassioned speech about unions, and I do not think there would be any argument from the Government side about the value of trade unions. However, does he have a view about some of the very well-paid officers that many unions have, who earn in excess of six figures in some cases? Could he not apply some pressure through his good offices to try to suppress some of those excessive salaries and fees?

[Imran Hussain]

The hon. Gentleman is somebody who I have time for and who normally makes some very good points. However, pay structures within organisations are pay structures within organisations—again, that issue is not relevant here. I take the point; he wants to make a political point. Again, I do not see the relevance of that issue in this debate.

The second statutory instrument deals with the financial penalties that the certification officer can impose. As the Minister pointed out, these can range up to £20,000 for a level 1 breach and closely resemble fines imposed in a criminal setting. However, the burden of proof is much lower, which means that the certification officer, in a politically motivated complaint, can impose a huge fine with a much lower evidential threshold. As I have pointed out, trade unions have high levels of compliance, with just one complaint for every 200,000 union members. As my hon. Friend the Member for Newport East pointed out earlier, the question is: what is the need for greater financial penalties when there has been no need for them in years gone by? This is a deliberate attempt by the Government to squeeze every last penny that they can from our trade unions, preventing them from putting funds forward, representing their members and fighting for working people. That is another reason why these statutory instruments must be voted down today.

The Minister also referred to the expansion of the certification officer’s investigatory powers—although that is not included in these SIs, Mr Davies, I do not think we can have this debate without discussing it. This expansion, giving the certification officer new and wide-ranging powers, will allow for the initiation of investigations against a trade union even if there are no complaints from within the union itself, allowing anti-union organisations to submit vexatious and politically motivated complaints against trade unions. Even if no such complaint is upheld, the damage to the trade union will already have been done, with valuable time, money and resources being spent on fighting vexatious complaints rather than unscrupulous employers.

--- Later in debate ---

[John Spellar]

You are right to bring me up to date, Mr Davies, because today, from the Government’s point of view, these sorts of regulations, which will be seen as anti-union not only in this country but elsewhere, will not help us in our relations with the United States, where there is an Administration that is strongly pro-union. We are trying to get a trade deal, and trade and workers’ rights are not unconnected. If we look, for example, at the import of personal protective equipment into the United States, a firm in Malaysia has been found guilty of unfair labour practice—forced labour. The United States then says, “We are barring that company from selling into the USA.”

[Craig Mackinlay]

The right hon. Gentleman is offering a great exposé of the history of the trade unions locally and internationally. We are talking here about a sum across the entire trade union movement of approximately £1 million at best, with an income, as highlighted by my hon. Friend the Member for Wyre Forest, of about £1 billion. I have just looked up some donations to the Labour party in 2019: £3.5 million for the election from Unite and £425,000 from the CWU. Is the right hon. Gentleman suggesting that by saving some of the administration costs to the union movement, it can recirculate more to the Labour party? Is that the core of his arguments?

[John Spellar]

That is a pretty poor argument because that would be in breach of very long-standing trade union legislation whereby members make a donation through the political levy to the political fund, which is protected. If the hon. Gentleman has one shred of evidence of administrative general fund money being channelled through into the political fund, even under the current law he can go straight down, because someone is not required to be a member in order to make that sort of payment. He might be a bit more sensitive about political donations and spending, but we will leave that on one side.

[Craig Mackinlay]

On a point of order, Mr Davies. I like political debate. I was acquitted in a court of law, and the right hon. Gentleman wishes to raise that in this debate. I find that disgusting, Mr Davies.

[The Chair]

That is not really a point of order. As I have pleaded before, we must stick to the issue before us today. If the right hon. Member for Warley will not stick to the issue before us today, I will move on to someone else who might. I urge him to stick to what we are debating today. He will have no further latitude because I have already given him plenty.

Gas and Electricity Costs

Lord Mackinlay of Richborough Excerpts

Tuesday 18th January 2022 Westminster Hall

[Jamie Stone]

I have no hesitation in joining my right hon. Friend in making that plea. His points are well made.

I hope that in getting this debate under way today, we start a dialogue with energy companies, Her Majesty’s Government and all concerned parties—not least those people who stand to be faced with crippling debts. I think of a young mother I know, who lives in the village of Balintore in my constituency. She tells me that she has to budget absolutely to balance the books; it is just a few pounds between surviving and going into the red. She says to me that if the electricity bill or the cost of diesel for her car goes up, she is in trouble. To square the books, she would then have to cut down on her expenditure. In turn, that hits the local shops, the local chemist and so on, in the seaboard villages of my constituency. I hope there will be a dialogue.

There have been, in what I have said, a lot of “coulds”, “shoulds” and “woulds”. What we really need from the Government is real, urgent action. I would suggest that they have failed millions of hard-working families and thousands of pensioners, at a time when energy bills are going through the roof. At this stage, the nation is plummeting further into a fuel poverty crisis. As far as I can see, there seem to be no plans to tackle it, but I await the Minister’s comments with great interest and expectation. At the end of the day, old people, single parents and people on very limited incomes are wondering how the heck they will get through the next period, because we all dread getting into debt.

Members from across the House have put forward suggestions to the Government on how to stop this disaster in its tracks. I respectfully suggest to Her Majesty’s Government that we stop the dither and delay, get talking, and do something about it.

[Craig Mackinlay (South Thanet) (Con)]

I thank the hon. Gentleman for securing this debate. It is a fact that all economies are facing an energy price rise, for international reasons. The hon. Member has not mentioned gas at all. No matter anyone’s views on gas, it will be part of our energy mix for a generation. I wonder if he might agree that we have been uniquely silly in diminishing our storage capacity, with the closure of the Rough field. Mother nature has given us a gift in this country: a lot of gas. No matter anyone’s view on the path to net zero, a super report by the House of Commons Library charts the reduction in our gas use over the years, and shows that we have reduced our gas capacity and production even faster, leading to imports. Does the hon. Member agree that it might be sensible to increase our domestic supply while gas is such an important part of our energy mix? That might give a longer-term solution to price volatility.

[Jamie Stone]

I will conclude in just a moment or two. I thank the hon. Member for his intervention. The bottom line is that if we care about the people I have mentioned, who are petrified of getting into fuel poverty, then we must look at all possible solutions. There will be a mix to the answer. I would not rule out anything that the hon. Member said. We will take a look at it.

Of course, if we get hydrogen production right, that also makes enormous sense, because it is absolutely neutral for the environment. Hydrogen is a gas, and we should be thinking about that as a possibility. I conclude my remarks there, Sir Edward. Thank you for your forbearance.

--- Later in debate ---

[Wera Hobhouse (Bath) (LD)]

It is a pleasure to serve under your chairship, Sir Edward. I reassure you that I will be brief. I congratulate my hon. Friend the Member for Caithness, Sutherland and Easter Ross (Jamie Stone) on securing this urgent debate. In Bath, in north-east Somerset, more than 10% of households are already living in fuel poverty and, as we have heard, that is likely to increase dramatically.

The council is working hard to provide a local household support fund, with grants of £250 to help the least well off with their energy costs this winter but, again as we have heard, energy costs are likely to rise by about £600. That grant is something, but it is clearly not what is needed. Many more of my constituents are worried about their next heating bill. What have the Government done to protect them? They have scrapped the programmes to insulate our homes, which would have reduced bills long ago. They have cut universal credit and increased the UK’s dependence on imported gas, rather than investing in renewables: green energy homemade in the UK—something the Minister knows I keep saying in these debates. That is what should have happened a long time ago.

I hear reports that the Treasury is scrapping the energy company obligation scheme, which has been a powerful driver in reducing household emissions. The Government must not touch that scheme. Instead, they should double and extend the warm home discount, as has been said. It cannot be right that gas companies are profiting from record prices, way up from where they were last year, when millions cannot afford to heat their homes. The Liberal Democrats are calling for a one-off windfall tax on the profits of oil and gas firms, to fund support for those who are struggling. Seventy-one per cent. of people support that move, as do 75% of the Government’s own voters. Why are the Government not severely and sincerely looking at the proposal of a windfall tax on the profits of oil and gas companies?

We need a long-term plan to prevent another energy crisis. Where is the urgent plan for a long-term home insulation programme that will cut bills permanently? This is a particular challenge for my constituents in Bath. Bath and North East Somerset Council proposes that the Government require landlords to bring housing up to an agreed energy certification standard, and I urge the Minister to look at that. The Government’s heat and buildings strategy was a missed opportunity for real ambition in this area. We have one of the oldest, least energy-efficient housing stocks in Europe. It is an emergency, and the Government should finally treat it as such.

Liberal Democrats are committed to reducing most emissions by 2030, which means a massive expansion of renewables and the replacement of the gas grid. In the context of this debate, we all know that there are some energy companies leading the way. Companies such as E.ON pride themselves on the fact that nearly all of their electricity is generated from renewables, but the shocking fact is that, while the price of renewables falls continuously, the customers of E.ON and other renewable electricity companies will find that their electricity bills go up by just as much as those of customers who buy electricity from burning gas. I have asked E.ON directly—

[Craig Mackinlay]

The hon. Lady has a high number of listed properties in her constituency of Bath, as I have in mine. Sandwich is the oldest medieval town in the country. Has she considered how old buildings, which are listed or in conservation areas and structurally virtually impossible to insulate, can be dealt with in a way that is affordable or achievable?

[Wera Hobhouse]

I thank the hon. Gentleman for his intervention. We have had a debate on listed buildings and how we can help owners. It is complicated, but I do believe it is important that owners of listed buildings get proper support, including help from the council to change the structure of their buildings to make them more energy efficient.

As I said, it is shocking that those trying to do the right thing by buying from companies getting their electricity only from renewables are facing the same cost rises as those buying their energy from companies making electricity from burning gas. It is a massive failure of Government, who have set the terms of the wholesale market to ensure that everybody pays when gas prices go up, even if they do not use gas. That is shocking and unforgivable. The Government must urgently look into how this issue can be fixed now.

Bulb Energy: Administration

Lord Mackinlay of Richborough Excerpts

Wednesday 24th November 2021 Commons Chamber

[Craig Mackinlay (South Thanet) (Con)]

I have been on something of an energy nomadic experience over the last few months. I started with Avro Energy a few months ago, but that went bankrupt and I was converted domestically to Bulb, and I am now in the support scheme within the space of three months. There was a 12% energy price rise at the last round, in August. Who knows what it will be in April next year? The policy of trying to sell ten pences for sixpence does not last very long. What we are going to see over this winter is the Treasury—that is, the taxpayer—making up the difference for these spot prices versus the reality of what energy is being sold for to domestic users. Will my right hon. Friend please see the vision that the only bridging energy supply, of which we have a lot domestically, is gas? We all want net zero sometimes, but it is not going to happen tomorrow; it is going to take a generation to get there. We have a domestic supply that can bring us the two key planks of energy: security of supply and affordability. Domestic users and the industry need that immediately.

[Kwasi Kwarteng]

I have two points in response to my hon. Friend. First, I am not embarrassed about the retail price cap. It has protected consumers effectively and we are proud to maintain it. On the security of gas, I could not agree with him more, but he should be addressing his comments to other Members of this House, who want essentially to shut down the UK continental shelf. We had a North sea transition deal precisely because we recognised that the transition would take a number of years.

Electricity

Lord Mackinlay of Richborough Excerpts

Monday 15th June 2020 Commons Chamber

[John Redwood (Wokingham) (Con)]

I am very concerned about the regulation, its provenance and whether it will limit our freedom of manoeuvre in ways we do not wish from the beginning of next year, when I hope we will be redesigning an energy policy that is fit for purpose to meet our three main priorities.

The Government have been very clear on their environmental priorities. They are not the subject of our debate today and I have no wish to go into them. They are an important matter that the Government have set forward, but the Government have always said that they have two other crucial priorities that matter a great deal as well. One is to have good value power—power that people can afford in their homes and which can make us more competitive in industry and commerce—where I think we have room for improvement. We also wish to pursue a policy of independence, so that we have resilience and reliability in our system. I therefore find it extremely worrying that we have responded to a state aid challenge upon us in the dying days of our membership of the single market, or its rules, when we are no longer a member of the European Union which sponsors it. We are setting forward a trajectory that says we will increase our imported power from 4% to 9%, mainly from the continent of Europe—from the EU—as part of our defence against historic allegations concerning state aid that would presumably go away from 1 January once we have left the European Union completely and once we legislate to make our own position clear.

Today’s regulation is not well described in the explanatory note. If one reads the 80-page European Commission decision document, one can see exactly how thorough their investigation has been since 2014 of our capacity market, how detailed their intervention in it has been, and how detailed the Government’s response has to be in this and in other work they have done to try to conform to the EU’s wish to redesign our capacity market in a way that they find acceptable and in a way that is clearly designed to promote a much wider European integrated energy market. Now, that may well make sense for neighbouring states close to each other on the continent—between Belgium, France and Germany. That is their choice and I have no problem with that. But as we are an island nation which used to be able to generate all its own power, I have some difficulties with that. We have many great advantages to generate wind power, wave power, solar power, hydro power and other renewable power, as well as prodigious reserves of other types of energy where the Government wish to gradually reduce or clean their use. There may well be clean ways of burning some of that carbon, with carbon sinks and so forth, which they will need and want to use.

It seems that the proposal today is from another age when we were gradually being linked into a continental system, which, incidentally, is a lot dirtier than our own system and has been really struggling to reduce its dependence on coal and its very weak strategic position of chronic dependence on Russian gas. The last thing we want to do as a country is connect ourselves to an ever bigger possible dependence on Russian gas via power generated on the continent when we have a wish to do our own thing.

It is a pity that the explanatory note does not mention the phrase “state aid” or explain up front that the regulations arise because of a state aid case. It refers to “Commission Decision SA.35980”. Those who follow these things know that “SA” stands for “state aid”, but it is not as clear and transparent as it might be. The average Member of this House probably does not follow those matters in that much detail and is not aware that we are being asked today to pass legislation because of a state aid infringement that goes all the way back in allegation to 2014. We ran that market relatively successfully from 2014 to 2018, it was suspended from 2018 until the end of last year, and now there has obviously been some sort of deal to get it up and running again.

The explanatory note states:

“Part 1 amends the description of a DSR CMU to clarify that a DSR CMU cannot provide capacity primarily by using a storage facility which reduces its import of electricity”.

Is not that interesting? First, we have to translate it. “DSR CMU” is the process that the shadow Minister was telling us about. One of the responses to a capacity market auction is to bid in an offer to buy less power than otherwise would have been bought as another way of contributing to the stability and resilience of the system rather than offering to provide more power for those who want to buy it. It is curious that the proposal is linked to any proposal that might reduce the import of electricity in the way that it does. That adds to my worries about the nature of this EU policy and intervention against the broader background of the EU’s trying to create a comprehensive European energy market with us fully linked into it.

The shadow Minister said that perhaps we were found to have acted illegally. The Commission is clear that that was the case for the period 2014 to 2018. It states that in its view the UK unlawfully implemented the capacity market in breach of article 108.3 of the treaty provisions on state aid. It has now come up with a form of words at the end of its decision that says that if we do those sort of things, it will see its way to believing that we are now compliant.

I do not suppose that the House has the appetite for a serious debate about any of that today and I understand that we are considering a statutory instrument, not our wider energy policy, but we should not let this go without some things being said. First, the regulations are the direct result of the most enormous intervention and intrusion into British energy policy and I hope that from 1 January next year, we will proudly set out our own energy policy and not need that sort of intervention. Secondly, the thrust of the policy was to make us more dependent on a European energy provision system that is neither secure nor particularly green. I strongly repeat that dragging us into more reliance on Russian gas is the last thing we want.

[Craig Mackinlay (South Thanet) (Con)]

My right hon. Friend made a point about EU energy not being particularly green. Does he share my concern that we pat ourselves on the back and say we have burnt no coal or had no electricity derived from coal over 30 or 60 days, yet much interconnector electricity has been manufactured by those dirty forms of energy that we are trying to get out of our market in the UK?

[John Redwood]

That is exactly right. People like to claim that we are importing nuclear energy from France, for example, but we are importing European energy in a pretty unified system, which has surplus capacity because it has not only French nuclear but an awful lot of dirty coal, Russian gas and so forth, which should cause us concern.

Thirdly, can we in future have an honest and clear explanation so that more Members of Parliament might understand what is going on and think it is a matter of some concern? I do not think that most of our colleagues realise that we are talking about resilience—our ability to keep the lights on in difficult conditions that might arise in future. We are talking about the pricing of electricity and these very big strategic issues. And finally, we are talking about whether this country is now going to have its own energy policy, or whether we are hastily legislating so that we can, for the foreseeable future, still be effectively under EU state aid rules, edging ever closer to integration with EU energy policy.

Draft Electricity Supplier Obligations (Excluded Electricity) (Amendment) Regulations 2019

Lord Mackinlay of Richborough Excerpts

Monday 3rd February 2020 General Committees

[Craig Mackinlay (South Thanet) (Con)]

It is always a pleasure to serve under your chairmanship, Mr Paisley. I just have some observations about where we are going with these measures.

I fully agree that for energy-intensive industries—a category that we are extending today to include flour milling—where there is the threat of foreign energy prices putting some of our industries out of business, with resultant job losses, this has to be a sensible policy. But—and this is a big but—if we are to make sure that EIIs do not suffer disadvantage on the global market, which is what this sensible policy is trying to achieve, consumers, smaller businesses and others will bear the burden of maintaining the required CfD amounts. That is where we are going with this. I can imagine that over time, more and more industries will say, “We have a problem. We are facing foreign competition, because energy per kilowatt hour in China, India, the US or other countries is that much lower.” For those industries in the UK, although they have the advantage of being on-site, the energy difference will be enough to solicit an import to do the substitution.

We have to be very careful. Our laudable aim of zero carbon will achieve little if all we do is offshore some manufacturing, when the offshore manufacturer is not producing the tonne of steel for the same number of kilowatt hours as could perhaps be achieved in a cleaner factory in the UK.

[Alan Brown]

On the topic of not offshoring manufacturing, does the hon. Gentleman agree with Matt Cole that the UK Government should include in future CfD auctions an incentive for bidders to use UK-based supply chains? At the moment, there is no quality assessment, so it is “lowest price wins”, but that could be changed with the correct tender assessment process.

[Craig Mackinlay]

I understand the hon. Gentleman’s point about domestic supply chains. I am not an interventionist in supply chains and the UK economy in the same way that his party is, so I probably would not agree with him about that.

To develop my point to a conclusion, if—for example—steel is being produced in a foreign jurisdiction in a way that is not so efficient per tonne and number of kilowatt hours, and we then use fossil fuels to import that steel on a ship, we do nothing for the planet in terms of overall CO₂ reductions.

I welcome the proposals, but I envisage various industries arguing for this policy to be extended over time, which will cost domestic consumers more and more, so some care is required. Much as I support what is being done today, there is a greater discussion to be had about the whole renewables industry and how it is financed, because at the end of the day, those who are suffering fuel poverty will only have their poverty exacerbated by such moves.