Crown Estate Bill [Lords]

David Chadwick Excerpts

Report stage
Monday 24th February 2025 Commons Chamber

The partnership between the Crown Estate and GB Energy has real potential to be a huge force for good—we really feel that down in Cornwall. It will spearhead the development of offshore renewable energy in a speedy but sustainable way, investing in energy production initially and laying the groundwork for our energy security of the future, as well as building our local communities, our infrastructure and our supply chains in some of the most left-behind and deprived parts of the UK.

[David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)]

I rise to speak in support of new clause 4 and to express my party’s frustration with the Government’s refusal thus far to devolve the Crown Estate to Wales. It is the firm view of the Liberal Democrats, both here in Westminster and in the Senedd, that this decision is wrong for Wales and its economy. Under the current system, the profits generated from Wales’s vast natural resources flow directly to the UK Treasury, offering no benefit to the communities where that wealth is created.

The Crown Estate in Wales is set to generate millions annually from offshore wind energy leases in Welsh waters. If this money were kept within Wales, it could contribute an estimated additional £50 million to the Welsh Government’s budget at a time when public services in Wales are crumbling. It is nothing short of outrageous that the Labour Government in Westminster seek to deny Wales these vital sources of income, which could help to address the crisis in our public services, economy and infrastructure. The Labour Government’s refusal to devolve these powers further entrenches the outrageous notion by Labour and the Conservatives that Wales is a lesser nation than Scotland.

While Scotland has controlled its Crown Estate since 2017, Wales, despite having vast Crown Estate assets within its borders, has been left without those powers. The benefits of devolution for Scotland have been clear, with the Scottish Crown Estate generating over £103 million for the public finances since 2017. The excuses we have heard from the UK Government for failing to put Wales on an equal footing simply do not hold up. Patronising comments from Ministers about how devolving the Crown Estate would not be in Wales’s “best interests” or would be a “waste of time” are frankly an insult to the people of Wales.

This Government claim to support growth, but they seem determined to keep Wales from reaching its full potential. Instead of empowering Welsh communities to harness the benefits of their own resources, profits continue to flow directly to London. That is not the vision of growth to benefit local communities or level up left-behind communities; it is a continuation of the Conservatives’ failed economic model, which prioritises centralisation and investment in the south-east of England over everywhere else. It would be a great mistake if those in power in Westminster were to deny Wales the opportunity to build a better future for our communities. I hope the Government will change their mind.

[Jim Allister (North Antrim) (TUV)]

I wish to primarily address new clause 7, tabled by the hon. Members for Belfast South and Mid Down (Claire Hanna) and for Ynys Môn (Llinos Medi), and to express opposition to it. It very much reflects what is in new clause 1, in terms of seeking devolution of the Crown Estate, but in this case to the Northern Ireland Executive in respect of the assets there. I oppose that for a number of reasons. It presently is a reserved matter, and I strongly believe that is how it should stay. I say that not because that is right ideologically, but because practically it is beyond belief that the current Stormont Executive could ever handle the controversies that come with the Crown Estate.

This is an Executive in Stormont that have been in existence for almost 13 months and still cannot agree a programme for Government. If we were to hand them something as controversial as control of the Crown Estate, we all know what the outcome would be. Why is it controversial? For one specific and historical reason. Lough Foyle is controlled and owned by the Crown Estate. It is a piece of water that separates County Londonderry, which is in Northern Ireland, from County Donegal, which is in the Republic of Ireland, but the entirety of Lough Foyle since last we had a King Charles rests under British control. In 1662, Charles II gifted Lough Foyle, the surrounding waters, the seabed and the waters within it to the Irish Society. The Irish Society was a conglomerate of various companies from the City of London, which did a great deal to develop and build the city of Londonderry; and as part of that, I presume, it was gifted control over Lough Foyle. In 1952, the Irish Society conveyed Lough Foyle to the Crown Estate.

A divided Executive in Northern Ireland would be hopelessly incapable of resolving the issues that flow from the somewhat controversial aspect of the entirety of Lough Foyle, right up to the coastline of County Donegal, being properly, legally and in perpetuity in the control of the Crown Estate. Therefore, devolving the Crown Estate to the Northern Ireland Executive would be disastrous for the good management of the lough and for the uncontroversial continuance of its ability to be developed. That might be a particular situation, but it is in addition to my opposition from an ideological point of view and my belief that the Crown Estate is a national asset that should continue to be of a reserved category. I think the proposition in new clause 7 would be the utmost folly; I trust that the Government will resist it and that the House will reject it.

--- Later in debate ---

[James Murray]

If the right hon. Member waits just a moment, I will come to some of the direct benefits for the people of Wales of retaining the Crown Estate in its current form.

It is important to emphasise that the Crown Estate’s marine investments are made on a portfolio-wide basis across England and Wales. Devolving to Wales would disrupt existing investments, as they would need to be restructured to accommodate a Welsh-specific entity. To devolve the Crown Estate at this time would risk jeopardising the pipeline of offshore wind development in the Celtic sea, which is planned for into the 2030s. The Crown Estate’s offshore wind leasing round 5 is spread across the English and Welsh administrative boundaries in the Celtic sea. It was launched in February last year and is expected to contribute 4.5 GW of total energy capacity—enough to power 4 million homes.

In addition to energy, the extensive jobs and supply chain requirements of round 5 will also likely deliver significant benefits for Wales and the wider United Kingdom. Lumen, an advisory firm to the Crown Estate, has estimated that manufacturing, transporting and assembling the wind farms could potentially create around 5,300 jobs and a £1.4 billion boost for the UK economy. Devolution would also delay UK-wide grid connectivity reform. The Crown Estate is using its data and expertise as manager of the seabed to feed into the National Energy System Operator’s new strategic spatial energy plan. On Wales, the Crown Estate is working in partnership with the energy system operator to ensure that its pipeline of Welsh projects—the biggest of which is the round 5 offshore wind opportunity in the Celtic sea—can benefit from this co-ordinated approach to grid connectivity up front.

[David Chadwick]

If devolution presents such enormous barriers, why are the Government choosing to put the headquarters of Great British Energy in Scotland?

[James Murray]

GB Energy is for the benefit of the whole of the UK. It is absolutely right to locate its headquarters in Aberdeen, given the strong connection between Aberdeen and use of the assets of the North sea to generate power for the entire United Kingdom. In fact, the hon. Gentleman’s example underlines my point, which is that when different parts of the United Kingdom work together, we can achieve more than we can separately. I thank him for endorsing my point.

It would not make commercial sense to introduce a new entity, with control of assets only within Wales, into a complex operating environment in which partnerships have already been formed. Furthermore, the Crown Estate’s assets and interests in Wales are fundamentally smaller than its assets in England, and would likely not be commercially viable if their costs were unsupported by the wider Crown Estate portfolio. The Crown Estate can take a longer-term approach to its investments and spread the cost of investments across its entire portfolio. A self-contained, single entity in Wales would not have the same ability; neither would it benefit from the expertise that the Crown Estate has developed over decades of delivering offshore wind at scale. A devolved entity would be starting from scratch.