Northern Ireland (Regional Rates and Energy) (No. 2) Bill

Gavin Robinson Excerpts

2nd reading: House of Commons
Wednesday 6th March 2019 Commons Chamber

[The Secretary of State for Northern Ireland (Karen Bradley)]

I beg to move, That the Bill be now read a Second time.

I rise to ask the House to give a Second Reading to a piece of proposed legislation that delivers on this Government’s commitment to ensure good governance and stable public finances in Northern Ireland. The Bill seeks to achieve those outcomes by bringing forward two essential measures. First, it will enable the collection of regional rates in Northern Ireland. Secondly, it will ensure that fair and appropriate tariffs and cost-capping measures are in place for the renewable heat incentive scheme in Northern Ireland.

As we discussed yesterday, the Government are committed to devolution. I am working hard to restore devolved government in Northern Ireland at the earliest opportunity. I firmly believe that this is the best long-term plan for the people of Northern Ireland and I profoundly believe it is in the best long-term interests of the Union. Important local decisions should be taken by locally elected politicians in Northern Ireland. I share the frustration felt by some Members of Parliament and the public that taking forward important proposed legislation in this manner in this House is not the ideal situation. However, in the absence of devolved government I have made it clear that I will continue to take the urgent and necessary decisions to ensure good governance and to protect public services.

[Gavin Robinson (Belfast East) (DUP)]

The Secretary of State will recall that during the passage of the Northern Ireland (Executive Formation and Exercise of Functions) Act 2018, we raised an urgent issue that crystallises at the end of this month: the forthcoming resources available to our housing associations in Northern Ireland. Because of an Office for National Statistics definitional issue, they would not have been able to draw down on financial transactions capital tax. Will she confirm today that Her Majesty’s Treasury has agreed to extend the derogation on that definition and that legislation will be brought forward in this Parliament to resolve this issue satisfactorily, so that our housing associations and co-ownership and other schemes have the funding available that will not impact on our block grant, but will allow people to have a sustainable future home in the Province?

[Karen Bradley]

I thank the hon. Gentleman for raising that important issue. It is clear that the derogation needs to and will continue, but that is not a long-term, sustainable solution. As he will know, the Northern Ireland civil service is putting together legislation and we await copies of that so that action can be taken.

[Gavin Robinson]

I am very grateful for that response. I understand that the legislation is there and is ready to be brought forward. Will the Secretary of State confirm that subject to parliamentary business, it will be introduced as soon as possible, and before the summer?

[Karen Bradley]

The hon. Gentleman may have more information than me. All I can say is that we know the Northern Ireland civil service is looking at that and we will act appropriately at the appropriate time.

The measures in the Bill are limited yet necessary interventions in Northern Ireland. They provide the certainty and support that Northern Ireland Departments and, indeed, the wider public need and deserve for the year ahead. I will now give more detail on the measures. Clause 1 addresses the collection of the regional rate. The UK Government have set the Northern Ireland regional rate in the absence of an Executive for the past two years. The level of rate to be applied this year was set out in my budget statement to Parliament last week. As part of the wider budget package of support to Northern Ireland for the 2019-20 financial year, the UK Government have set a 3% plus inflation increase on the domestic rate and an inflation-only increase on the non-domestic rate.

--- Later in debate ---

[Sammy Wilson (East Antrim) (DUP)]

rose—

[Gavin Robinson]

rose—

[Karen Bradley]

I do want to make some progress, but I recognise that many interests are involved. I will give way to the right hon. Member for East Antrim (Sammy Wilson) and to the hon. Member for Belfast East (Gavin Robinson), but then I will conclude my speech.

--- Later in debate ---

[Gavin Robinson]

The Secretary of State talked about a 12% rate of return. She knows that participants in the scheme will be listening very carefully to what is being said today. According to figures that were given yesterday, over the 20-year period of the scheme the rate of return will be 60%, but whether it is 12% or 60%, officials were indicating that the money had largely been paid. Will the Secretary of State confirm that, and does she agree with those figures?

[Karen Bradley]

As I have said, the figures will all be individual, and it is impossible for me to give the hon. Gentleman a generality from the Dispatch Box. However, he is right to say that the subsidies that have been paid to date will, on the whole, be higher than the subsidies that will be paid from now on. The point is that unless those steps were taken, the subsidies that were being paid would breach state aid rules, and the scheme would be illegal and would be closed. This is the maximum level at which subsidies can be paid if the scheme is to continue to be legal.

Representatives of the Department for the Economy will meet other interested parties, such as the banks and those in the agri-food supply chain, to discuss the impacts and seek support for affected participants. The Department has also agreed to provide additional advice and technical assistance for participants. I know that this is a very difficult matter, but I believe that the measures proposed by the Department for the Economy are fair, and strike the correct balance between the rights of participants and the wider public interest.

To conclude—

[Gavin Robinson]

rose—

[Karen Bradley]

I was about to conclude, but I will give way to the hon. Gentleman, because he is irresistible.

[Gavin Robinson]

I am very grateful to the Secretary of State. She says that I am irresistible; how could I disagree? She is very kind to give way for a final time.

I want to focus on the fact that the Secretary of State said there was a fixed rate of return of 12%. Participants can hear today that they will not receive that money in the forthcoming years under the terms of the Bill. Is it not the case that the Department for the Economy is saying that they have already received it?

[Karen Bradley]

As I have said, these are the measures that we need to take now to ensure that the scheme remains on a legal footing. These are the steps that need to be taken to ensure that any subsidies can continue to be paid from the scheme and allow it to remain within the state aid rules. However, I am sure we will debate this issue further at a later stage, and I do understand the hon. Gentleman’s points.

The Bill does two things, both of which are required for good governance and stable public finances in Northern Ireland. I hope that colleagues on both sides of the House agree that it is important for us to make progress now to protect the best interests of all people in Northern Ireland, and to that end I commend the Bill to the House.