Nissan: Sunderland

Greg Clark Excerpts

Monday 31st October 2016 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

With permission, Mr Speaker, I wish to make a statement about Nissan in Sunderland. Last Thursday, 27 October, the Nissan Motor Company Ltd announced that, following a meeting of its executive committee, both the next Qashqai and X-Trail models will be produced at its Sunderland plant. The plant will be expanded through new investment to be a super-plant, manufacturing more than 600,000 cars a year. Some 80% of the plant’s output is exported to more than 130 international markets.

The decision is a massive win for the 7,000 direct employees and 35,000 total British employees in the plant and the supply chain. It is a stunning tribute to the local workforce, which has made the Sunderland plant, in the words of the chief executive of Nissan, “a globally competitive powerhouse”. We are immensely proud of it and proud of them. Of course, the decision is great news for the people of the north-east more widely, for our world-class automotive sector and for the whole British economy. This is but the latest in a series of exciting investments in the United Kingdom, which is proving to the world that we are open for business. Indeed, it is hard to think of more unambiguously good news.

My colleagues in the Government and I have been vigorous in ensuring that the Nissan board had no doubts about the importance of this plant and this industry to the British people. Through the many conversations I and my colleagues had both here and in Japan, it became clear that four reassurances were important to securing the investment for Britain. Three were about the automotive sector generally and one was about Brexit.

The first was that we would continue our successful and long-standing programme of support for the competitiveness of the automotive sector, including Nissan. This support is available to firms for skills and training the local workforce, research and development, and innovation, in line with EU and UK Government rules. Since 2010, the Government have invested £400 million in the UK automotive sector in this way. We will continue to invest hundreds of millions more over the coming years. All proposals from any company must be underpinned by strong business cases and tested against published eligibility criteria. All proposals are also subject to rigorous external scrutiny by the independent Industrial Development Advisory Board and are reported on to Parliament.

The second was that we would continue our work with the automotive sector, including Nissan at Sunderland, to ensure that more of the supply chain can locate in the UK and in close proximity to major manufacturing sites. In a previous post, I established the local growth deals and city deals, which, working with local enterprise partnerships, have provided a way in which local councils, businesses and the Government can upgrade sites, especially those brought into use from dereliction, and provide the infrastructure for the small and medium-sized businesses that can supply these major companies. I can confirm that this programme will continue, and with vigour.

The third that was we would maintain a strong commitment to research and development, in particular the take-up of ultra-low emission vehicles. The opportunities presented by bringing the Department of Energy and Climate Change together with the Business Department make us ideally placed to build on Britain’s strengths in low-carbon energy, the automotive sector, science, research and many other areas.

The fourth was that in our negotiations to leave the EU, we will emphasise the very strong common ground, especially in the automotive sector, that exists between ourselves and other EU member states in ensuring that trade between us can be free and unencumbered by impediments. A good deal for the UK can also be a good deal for other member states, and that is how we will approach the negotiations. Whatever the outcome, we are determined to ensure that the UK continues to be one of the most competitive locations in the world for automotive and other advanced manufacturing.

Last Thursday was a great day for Sunderland and for Britain, but the best is yet to come. Over 30 years, Nissan has invested more than £3.7 billion in our country and has created excellent jobs for a whole generation of world-beating British workers. Last week’s announcement means that a new generation of apprentices, technicians, engineers, managers and many other working men and women can look forward to careers filled with opportunity and success. This Government will always back them to the hilt. I commend this statement and Nissan’s welcome decision to this House.

[Clive Lewis (Norwich South) (Lab)]

I thank the Secretary of State for his statement and for responding to our repeated requests for clarification on the events of the past few days. I join him in warmly welcoming Nissan’s decision to keep production in the UK. It is fantastic news for Nissan’s 7,000 employees and the 38,000-plus employees who rely on its supply chain. It is fantastic news for Sunderland, and it is fantastic news for the whole country. It is a testament to the skill, productivity and ability of the workforce and management that Nissan has such confidence in its Sunderland operation.

Without detracting from that, we still have some concerns. The right hon. Gentleman has denied giving Nissan special treatment, but he has refused to be transparent about what he has offered to it. As our most productive car factory, Nissan’s Sunderland plant epitomises the strengths of the UK’s automotive industry. He knows that we simply could not afford to lose it. That is why, despite the assurances that he has given now and in his tantalising television appearances over the weekend, the nagging question remains: are we really to believe that Nissan is risking millions of pounds of investment and the success of its newest models on the basis of the Government’s good intentions alone? If that is the case, why have they kept their good intentions to themselves?

The overwhelming impression until now has been that the Government have no strategy for Brexit. Are we expected to believe that the Government now have not only a strategy, but a strategy so convincing that they have persuaded Nissan to stay without the need for any special guarantees? If so, why will they not tell us what it is? We are told in the media—the media is where most of last week’s revelations transpired—that the Government gave a commitment to Nissan that Britain would be as attractive after Brexit as it is today.

It would seem that the Secretary of State has discovered the Brexit equivalent of the Philosopher’s stone: tariff-free market access with no concessions, readily agreed by all 27 EU countries, including Wallonia. Surely, that is a feat worth sharing. So can he tell us whether he is committing to full single market access or to a customs union or to something else entirely—or do the Government simply not know? We all want all car manufacturers to keep their production in the UK—[Interruption.] Yes, we do. So why are they not privy to the same assurances as Nissan, and what about the many other businesses up and down the country—businesses that, like Nissan, are currently deciding whether to continue investing in the UK? Surely, they, too, should be told.

I have acknowledged that the automotive sector is hugely important to our economy, but it is not our only strategically important industry. Where were the Government during the crisis in the steel industry? They were blocking the EU from taking action against Chinese steel dumping—that is where they were. What are the Government doing for the aerospace industry, or for pharmaceuticals, and what about the service sector, which accounts for more than three quarters of our economy?

It seems that the Government are giving private reassurances to particular companies, while leaving the majority of businesses, the public and their elected representatives in the dark about their intentions. Piecemeal, back-room deals will not provide the active industrial strategy that Labour has long advocated and to which the Government now claim to be signed up. We Labour Members want the economy firing on all cylinders, not spluttering along on one or two.

As we embark on Brexit, Britain needs a Government who are visionary, not reactive, and strategic, not shambolic. As a start, we need a Government who are transparent and accountable, instead of secretive. Why not start now? If the right hon. Gentleman did not offer Nissan a sweetener, what has he got to hide? Show us the letter. If the assurances he gave to Nissan apply to all the automotive sector, surely all that sector should be given them? Show us the letter. If, contrary to appearances, the Government do have a strategy for Brexit, why will they not tell us what it is? Show us the letter!

[Greg Clark]

I welcome the hon. Gentleman to the Dispatch Box, but if that is the kind of spluttering old banger of an approach to these issues, I think he should upgrade to a new model. I would recommend a Qashqai; they are very good cars. I find it surprising that, in response to an announcement that has thrilled Sunderland and the north-east and provided a big boost to the economy, the Labour party’s demeanour is so miserable. Is it beyond the hon. Gentleman to put party politics aside and just celebrate and congratulate everyone involved on a success that is in all our interests?

I seriously ask the hon. Gentleman to weigh this issue up carefully. When I met Nissan, one thing it commented on was the continuity over 30 years of a very successful participation in the UK economy, with cross-party support and consensus over the Sunderland plant—reflected in what both Conservative and Labour Governments have done. It would be to take a wrong turn if the Labour party lurched away from the bipartisanship that has been so successful there.

As for the conversations that we had, one of the things that I have learnt over the years is the importance of getting to know, over time, the companies that are in this country and those that invest in it, and understanding what their investment decisions will be based on. We have taken the opportunity to do that, and the four reassurances that I was able to give Nissan and that have resulted in this investment reflected what Nissan had said to me.

I said that I would aim for the best possible ability to trade with other European Union countries. I said that I would pursue the negotiations in a positive and constructive spirit, mindful of the substantial common ground that exists between us. I said that whatever happened, we were determined to keep Britain’s world-beating motor industry competitive. Do Labour Members share those intentions? If they do, why on earth do they think that I would play games with the livelihoods of 35,000 working people in this country, the pride of the world in their industry, by not stating them clearly and transparently to Nissan? I welcome the decision that Nissan has made.

The hon. Gentleman asked me whether I would publish the correspondence. I have set out the information that I gave to Nissan. My responsibility, on behalf of the Government, is to encourage and attract investment in this country. When companies of all types and in all sectors share with me investment plans that would be of interest to their prospective competitors, it is important for them to be assured that those plans will not be disclosed to their competitors to their disadvantage. My objective is to obtain the investment, but I shall be happy to answer questions about every aspect of it, today and when I appear before the Select Committee—which I intend to do, at the Committee’s invitation.

The hon. Gentleman is a relatively new Member, and I hope that he will have a distinguished tenure here, but Members in all parts of the House—from Newcastle to Newquay, from Liverpool to Lowestoft—will know that whenever I work to attract success to our regions, towns, cities and counties, I do so on a cross-party basis. Party politics never feature in the way I work. I hope that, in future, we shall be able to work together on such common interests.

[Several hon. Members rose—]

[Nicky Morgan (Loughborough) (Con)]

The Secretary of State is to be congratulated on his announcement, which is clearly very good news for Sunderland, but I think that he will understand Parliament’s desire to understand the terms on which these and other negotiations are conducted. May I ask whether he has discussed this matter with the International Trade Secretary, and whether he will be in the driving seat of future trade negotiations? We all think that he is rather good at it.

[Greg Clark]

I am grateful for my right hon. Friend’s compliments. As she knows, we have a Cabinet Committee on Brexit, on which I serve alongside my right hon. Friend the Secretary of State for International Trade.

--- Later in debate ---

[Mr Speaker]

Order. I am sorry, but we must press on.

[Greg Clark]

The hon. Gentleman started well, Mr Speaker, although I certainly have not been slapped down, up, sideways or any other way by the Prime Minister, I am pleased to say.

The approach I have set out to the House and stated previously simply reflects what I would have thought is common sense: in an area—we have been talking about the automotive sector—in which there are substantial exports that come from Britain to the EU and from the EU to this country and components go backwards and forwards, there is a clear common interest in having arrangements that are free of tariffs and the bureaucratic impediments I mentioned. So it seems to me that when we embark on any negotiation, it is about finding the common ground and having a positive volition so to do. That is what I set out and that is what I described to Nissan, and indeed would do to any other manufacturer. It is on that basis, along with the other points I have made, that Nissan felt able to make this fantastic investment not only in the north-east, but in the United Kingdom.

[Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)]

The Prime Minister surely has not slapped down my right hon. Friend, but has slapped him on the back as a gesture of congratulations on a remarkable deal. I ask my right hon. Friend to come clean on one other issue he left off his list, which I am sure he mentioned to Nissan, however. He will have reminded Nissan that the UK outside the EU will be able to set its own new trade deals—and guess which car manufacturers will benefit from free trade deals with the rest of world.

[Greg Clark]

I am grateful for my right hon. Friend’s endorsement. As the Prime Minister said, we are going to make a success of Brexit, and we want every sector of our economy, including the automotive sector, not to be disadvantaged by Brexit, but to reap the benefits and be more competitive in the future.

[Mr Iain Wright (Hartlepool) (Lab)]

I commend the Government and the Secretary of State on this piece of great news; it is a welcome example of targeted Government commitment to a successful company in a strategically vital sector in the most important region on earth. However, will the same sort of targeted investment be available to other firms and sectors? If so, how will these be selected in the context of a proper industrial strategy, and will such companies and sectors be given similar reassurance and support to that provided to Nissan?

[Greg Clark]

I am grateful for the generous compliment the Chairman of the Select Committee pays me. I am certainly not going to disagree with him on what he said about the north-east, but I should say that Kent ranks equally. I am looking forward to coming before his Select Committee, not only to answer questions but to talk about the industrial strategy. The approach I not just intend to take but am already taking is to take time to meet the firms in our economy and understand the different needs of different sectors, so that we can be informed by them as we form our negotiating mandate. Those needs will obviously be different from sector to sector, and my commitment, which we will share when we meet in his Committee, is through our industrial strategy to make sure that we have confidence both for individual sectors and for individual places, because there is a very interesting confluence there. Investment in Nissan is good for the sector and good for Sunderland and the north-east.

[Michael Gove (Surrey Heath) (Con)]

I should declare an interest as a driver—albeit not a very good one—of a Nissan Qashqai. For years, we have had calls from across the House for an activist, interventionist Business Secretary who is prepared to do everything possible in order to secure jobs for working-class people in disadvantaged parts of the country. Now we have one, can my right hon. Friend explain why Opposition Members will not take yes for an answer? Was Oscar Wilde not right that there is only one thing worse than not getting one’s heart’s desire and that is getting it?

[Edward Miliband (Doncaster North) (Lab)]

I welcome the announcement, but I want to ask the Secretary of State about the duties and rights of this House. Last Monday, the Prime Minister told the House that

“the Government must not show their hand in detail” —[Official Report, 24 October 2016; Vol. 616, c. 27.]

to Parliament in advance of the Brexit negotiations. At the very same time, however, we now know that the Secretary of State was telling Nissan the Government’s detailed negotiating stance for the automotive sector, including that there would be tariff-free trade and no bureaucratic impediments. Will the Secretary of State explain how those two positions are consistent?

[Greg Clark]

The right hon. Gentleman, for whom I have a high personal regard, exemplifies what my right hon. Friend the Member for Surrey Heath (Michael Gove) was saying: he looks so glum at this news. What I set out to the House, to Nissan and to any firm that is in this country is what my colleagues have said repeatedly: there is a great common interest among other European Union nations and ourselves in having a deal following the negotiations that maximises the benefit to both sides. That seems so obvious that it is hardly worthy emphasising. That is the demeanour with which we will approach the negotiations. It is the approach that I have always taken in negotiations, and it seems as though that is something that people are glad to hear.

[Mr Andrew Tyrie (Chichester) (Con)]

I congratulate the Secretary of State on providing a great deal for the north-east. His clarification that the Government wanted continued access to the single market without bureaucratic impediments is a significant extension and exposure of the Government’s negotiating position. Does the Secretary of State agree that the rules of origin that the UK would face outside the customs union would certainly constitute bureaucratic impediments?

[Greg Clark]

This goes beyond any discussions that I have had with any company here. Why would we not aim to avoid bureaucratic impediments as a matter of negotiation? That seems to be common sense and that is what I set out.

[Hilary Benn (Leeds Central) (Lab)]

We all welcome the Nissan announcement, but Nissan is only one company that is making decisions now about its future investment in the United Kingdom. Given the persuasive reassurance that the right hon. Gentleman was able to offer the company, can he tell the House whether his offer of tariff-free access to the European market will be available to all other parts of our manufacturing sector? If I heard him right, he indicated a moment ago that the Government might take a different approach for different sectors. If that means that some might not benefit from tariff-free access, they would like to know pretty quickly.

[Greg Clark]

The right hon. Gentleman is wise enough to know that it is not in my gift to offer tariff-free access to the single market. I was describing what would be a positive outcome from the negotiations, which therefore relates to the demeanour that we should take in those negotiations. My right hon. Friend the Member for Loughborough (Nicky Morgan) paid me a personal compliment, but my team shares my vigour in talking to companies up and down the land to ensure that we understand what is important to them and to inform our negotiations. That seems an eminently sensible thing to do.

[Anna Soubry (Broxtowe) (Con)]

I warmly congratulate my right hon. Friend and the Prime Minister on securing this fantastic new deal with Nissan, which will benefit not only the good people of the north-east. Thanks to the supply chain, the benefits will extend throughout the whole country, helping many tens of thousands of people and their families.

I met a constituent on Saturday who runs a small IT business employing 14 people and he, too, wants certainty on tariffs. He told me that if tariffs are imposed on his business, he will have to get rid of it, meaning that 14 people will lose their jobs. Big companies, small companies and huge companies from all sectors need certainty. Does my right hon. Friend agree that it is right that this House has a debate and a vote on the underlying principles of our negotiations as we leave the EU in order to give the Government a true mandate?

[Greg Clark]

I am grateful to my right hon. Friend for what she said. When she was a Minister in my Department —or its predecessor—she was vigorous in engaging with businesses and understanding what they need. I regularly meet small businesses and their representative organisations, having done so many times since my appointment. She rightly says that it is important that their views help shape our negotiating mandate. On the debates in this House, the Prime Minister and my Cabinet colleagues have said repeatedly that there will be many occasions to debate and have these things scrutinised in this House.

[Julie Elliott (Sunderland Central) (Lab)]

I warmly welcome the Minister’s statement and the kind words about my home city of Sunderland from somebody from Middlesbrough. There was palpable relief in Sunderland on Thursday at the announcement, but concerns remain about the supply chain, because if there is an automotive sectoral deal, these firms will not necessarily be included, as they supply other types of industry. There are also concerns about the wider manufacturing base in the north-east as we move forward with the Brexit negotiations.

[Greg Clark]

I am grateful to the hon. Lady for what she says. Middlesbrough has been doing a bit better in football terms than Sunderland this season, so it deserves a break when it comes to Nissan. The supply chain is incredibly important, and across the automotive sector, whether in the north-east or the west midlands or other parts of the country, there are businesses that are currently overseas that could locate close to the main plants. If sites can be remediated where, for example, they require better road access, it is in everyone’s interest if we work on that together. That was part of the discussions, and will particularly benefit the supply chain.

[Jeremy Quin (Horsham) (Con)]

I warmly congratulate the Secretary of State on the announcement. Will he assure the House that he will not jeopardise future fantastic announcements by revealing too much confidential information from discussions between him and the other parties?

[Greg Clark]

I am grateful to my hon. Friend for his question. I am happy to answer any questions that the House has, and I am looking forward to appearing before the Select Committee. I have been pretty candid, describing each of the four aspects of the reassurances that I was able to give, but if companies that are considering an investment here describe commercial plans that they may not want to fall into the hands of their competitors, it is reasonable that they should have that confidence when dealing with the UK Government.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

As a fellow north-easterner, I am sure the Secretary of State will know that Thursday’s news buoyed not only Sunderland, but the wider north-east. Even I got a little teary-eyed at the plant on Thursday evening, knowing that the announcement had secured the livelihoods and future aspirations of so many families, who were all that night breathing a sigh of relief. The details of the letter are important, but may I, as the local MP for the plant, and on behalf of the workforce of almost 46,000 people across the UK, whose jobs are now more secure, just say thank you?

[Greg Clark]

I am touched by the hon. Lady’s statement; it is very kind and very good of her. When we were having these discussions, I always had in mind the fact that this is not a theoretical investment, and that we are talking about real people who work hard and do brilliant work. They are the best regarded in the world in the international system; they are the most productive in the world and go to Japan to help train some of the auto workers there. I am proud of that, as is she; the whole House should be proud of the workforce there.

[Nick Herbert (Arundel and South Downs) (Con)]

I congratulate my right hon. Friend. How can his reassurance to Nissan that there will be continued access to the European market without bureaucratic impediment be assured if Britain is outside the customs union?

[Greg Clark]

As I have said to other hon. Members, what I was able to say is how we would go into a negotiation, which seems to me to be to find common ground. We certainly did not get into any discussions of particular models, as my right hon. Friend would expect. One can overcomplicate these things; to be clear about one’s intention to find common ground and to pursue discussions in a rational and civilised way is not a bad thing to be able to convey.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

I wholeheartedly welcome Nissan’s decision, which will protect thousands of jobs and many of the people whom I represent. May I press the Secretary of State again on the issue of the supply chain? He has talked about the supply chain of the future, but what more can he say by way of reassurance both to the existing supply chain and to the wider manufacturing sector in the region that he will do everything in his power to protect their interests and the medium-sized businesses that serve it?

[Greg Clark]

I certainly will do everything in my power. I look forward when I next visit Sunderland to meeting the existing supply chain. The hon. Lady will know that we have already done quite a lot in that regard. I helped to negotiate the Sunderland city deal and to establish the advanced manufacturing park near the Nissan site, precisely to provide better facilities. She will know about the new bridge for which we secured funding to assist with that. I know very well the importance of not just the major sites, vital though they are, but of the whole ecology of business around them. That is one reason why this investment is so important. Important though Nissan is, the investment gives another big boost to the existing supply chain and to those competitors that will join it in the future.

[Mark Pawsey (Rugby) (Con)]

This great news continues the work of this Government to rebalance our economy. It also provides an incentive to continue to improve skills and to encourage innovation. Does the Secretary of State agree that our catapult centres, including the Manufacturing Technology Centre in my constituency, have a big part to play in that role?

[Greg Clark]

I do indeed. One of the enticing things that we can offer companies looking to locate here is the excellence of our research and our science, whether it is in universities or, increasingly, in institutions such as catapults that help translate those skills into the wider market. Through our industrial strategy, we want to increase the focus on this very important area of strength, so that other firms can invest and see Britain as the go-to place for advanced manufacturing and for other sectors, too.

[Phil Wilson (Sedgefield) (Lab)]

The news about Nissan in the north-east is brilliant, but there are other strategic industries in the north-east of England. I include Hitachi Rail Europe in my constituency, which opened a £90 million factory last year, employing almost 1,000 people and hundreds more in the supply chain. Hitachi Rail Europe is here for the long term to have access to the European market. At the moment, it is building the Intercity Express Programme. Building the machines will take about three years, so it is here for the long term. In the spirit of this cross-party approach that the Secretary of State say he wants to take, will he meet me to see what we can do to ensure that the Japanese company will continue to invest in the north-east?

[Greg Clark]

I will indeed. In fact, I am meeting Hitachi tomorrow, and have the privilege of presenting an award at Asia House in commemoration of the very long and positive association that we have had with it. On one of my previous visits to Japan in this role, I had the great pleasure of meeting many of the Hitachi directors and seeing their innovation and their continued commitment to this country—very important.

[Richard Graham (Gloucester) (Con)]

The desperate search for a commercial bung in this announcement by some Members of the Opposition is, frankly, insulting to Britain, Japan, Nissan and Sunderland. Does my right hon. Friend agree that, rather than talking the country down, we should be celebrating the recent inward investment successes, not least from the far east, which demonstrate that the Government are living up to their commitment to making a success of Brexit?

[Greg Clark]

As I said earlier, it is unambiguously good news, and I hope that the whole House will welcome it.

[Mr Kevan Jones (North Durham) (Lab)]

Many people in my North Durham constituency work at Nissan, so I warmly welcome the news and thank the Minister for his involvement. If he has done a special deal for Nissan, good. I just look forward to many more for the north-east companies that rely on exports.

[Greg Clark]

I thank the hon. Gentleman for his words. I do believe in being active and vigorous and in meeting companies and understanding the challenges that they face; I make no apology for that. My whole ministerial team will be active in securing investments for this country.

[James Cartlidge (South Suffolk) (Con)]

This fantastic news makes us proud of British industry. Does my right hon. Friend agree that many factors make this country attractive to companies such as Nissan? A key one is our competitive rate of corporation tax. Will he ensure that in the coming autumn statement, our rate not only stays competitive, but perhaps gets even more competitive?

[Greg Clark]

My hon. Friend needs to direct that request to the Chancellor—I will pass it on when I see my right hon. Friend in Cabinet tomorrow—but he is right to remind the House that there is a range of attributes and strengths that makes this country attractive to overseas and domestic investors. It is important that, across the whole range, we get them right.

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

I warmly welcome the Secretary of State’s statement. The news is extremely important to the north-east economy, including companies such as Nifco and Teesport in the Teesside area. Nissan is a massive buyer of strip steel in the United Kingdom. Earlier this year after the steel crisis, Nissan was hunting around for new suppliers, usually in the European Union, for that chain. We have had a disastrous experience in the north-east prior to this announcement, which stands in contrast to the SSI Redcar situation that has happened on this Government’s watch. Although it has taken six years for the Government to understand what new Labour-style industrial activism is, I very much welcome that and the statement today.

[Greg Clark]

I am grateful for the backhanded compliment. I am not sure that I would agree that this is new Labour-style industrial activism. The hon. Gentleman will know that it was a Conservative Government 30 years ago who secured Nissan for the UK, and I am proud that it is a Conservative Government who have secured its future in Britain.

[Amanda Milling (Cannock Chase) (Con)]

I, too, congratulate my right hon. Friend on the announcement. Does he agree that the commitment from Nissan is good news not only for the north-east and Nissan’s direct employees, but for the supply chain companies and their employees across the country, such as those who work at Gestamp Tallent, which has a manufacturing plant in Cannock?

[Greg Clark]

I certainly do, and my hon. Friend is right to point out the wave of benefits across the economy, one example of which was given by the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop). The consequences of such positive news extend to other important sectors. That is why it is important that we should be active and vigorous in attracting these investments.

[Dame Rosie Winterton (Doncaster Central) (Lab)]

This is an extremely welcome announcement, but there is a worry that it could be an isolated deal, rather than a clear strategy for the regions. When the situation is contrasted with the redundancies announced by DB Cargo UK in Doncaster, with Brexit being cited as one of the reasons, does it not point to why it is so important for the Government to conduct regional impact assessments of Brexit, and to publish them to demonstrate that there is a clearly though out strategy that will reflect the needs of regions, as well as sectors?

[Greg Clark]

It is nice to hear the right hon. Lady being able to speak from the Back Benches; she does so compellingly. As colleagues who know my interests in these matters would expect me to say, I believe that our regions, towns, cities and counties have an important role to play in our industrial strategy. I do not know whether she has been elected to the new Business, Energy and Industrial Strategy Committee, but I am sure she will be able to attend its sittings, because I hope that we will be discussing precisely this during the next few weeks.

[Jason McCartney (Colne Valley) (Con)]

It is Offshore Wind Week, so will the Secretary of State join me in welcoming this fantastic news for Nissan and confirm that it will play a key role in a low-carbon future for British industry?

[Greg Clark]

I am delighted that my hon. Friend has mentioned that. One of the great opportunities in industrial strategy is to combine our world leadership in offshore wind renewable energy with our commanding position in the automotive sector, and to bring them together so that when it comes to electrical vehicles and battery storage, we can lead the world, which is what we intend to do.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

The Secretary of State deserves credit for a significant and substantial achievement, but special deals for the car industry or the financial services sector offer little comfort to the thousands of small businesses the length and breadth of this country—which, incidentally, goes north of Newcastle—that depend on exports for their livelihood. What will the Secretary of State do to ensure that these small businesses, which are the lifeblood of so many of our communities, get the same access to him and his Department as has clearly been given to the big boys in the multinationals?

[Greg Clark]

I am delighted that the right hon. Gentleman asks that question because one of my first visits as Secretary of State was to Aberdeen, where I had a very successful and important meeting with its chamber of commerce. Small businesses in Aberdeen and Aberdeenshire were talking about what they wanted to achieve from the Brexit negotiations. I think that I am the first Secretary of State in the Department to have appointed Ministers with regional and national responsibilities in relation to the devolved Administrations, which reflects the importance of building small businesses and every part of the United Kingdom into the industrial strategy.

[Justin Tomlinson (North Swindon) (Con)]

I welcome this positive and proactive approach. Has the Secretary of State had a chance to meet Honda to discuss future opportunities?

[Greg Clark]

Yes, indeed. I met Honda when I was in Japan 10 days or so ago.

[Maria Eagle (Garston and Halewood) (Lab)]

I am glad that Nissan is continuing to invest in the north-east. Can the Minister give me in Liverpool some comfort—I would accept a letter—that I can pass on to Jaguar Land Rover, Getrag and the other automotive supply chain industries in my constituency to assure them that they will be treated in exactly the same way?

[Greg Clark]

I have been clear about maintaining the competitiveness of the automotive sector. The hon. Lady mentions some companies, and I am meeting Jaguar Land Rover again shortly—I meet it regularly. It is part of the development of our industrial strategy, and it is important that it should be. These are the companies, with their supply chain, that are succeeding and have contributed to our national success. We will work with them to build on that success and achieve even greater success in future.

[Mr Philip Hollobone (Kettering) (Con)]

I congratulate my right hon. Friend on what is undoubtedly a huge personal achievement, and the people of the north-east on creating in the Sunderland plant a globally competitive powerhouse. Is not this deal a signal to those remainers who have become remoaners that they should recalibrate their doom and gloom and become far more optimistic about the future of this country outside the European Union?

[Greg Clark]

This is a day for celebration rather than debating such issues. We should all celebrate this big success, which shows that Britain is and can be competitive, and that some of the world’s biggest companies are backing us very vigorously.

[Helen Goodman (Bishop Auckland) (Lab)]

The Secretary of State obviously said the right thing to Nissan. He knows that there are many manufacturing industries with international supply chains, such as Glaxo in my constituency, so when he is sitting in the Brexit Cabinet Sub-Committee, will he impress on his colleagues the value of staying in the customs union?

[Greg Clark]

The approach that I have set out across our economy is to meet those businesses that are part of my responsibility and to have sensible discussions so that I understand from them what they need. That informs our negotiating mandate. That is my commitment to all the businesses—large and small—that I meet.

[Tom Pursglove (Corby) (Con)]

This announcement clearly shows the world that Britain is open for business. I hope that our supply chains will get a boost from this too, particularly UK steel. Will my right hon. Friend say a little about the wider involvement of the UK automobile sector in the forthcoming industrial strategy and how the announcement fits into that?

[Greg Clark]

I certainly will. With any industrial strategy, we should build on our strengths and not be complacent, but recognise that in order to continue to be strong, we need to look at the underlying conditions for promoting that. The presence of a vigorous supply chain is important for the automotive sector. It is important to be at the cutting edge of research and development, and to have skills in the workforce on which expanding companies can count in order to fulfil their order books. Those are all important enabling conditions, and the Government have a role to play by working with companies to make sure that they are all met.

[Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)]

Can the Secretary of State confirm whether the arrangement with Nissan is a one-off or part of a wider strategy to protect the economy from the impact of Brexit? If it is part of a wider strategy, what other businesses and organisations has he spoken to over the past few months on similar terms?

[Greg Clark]

It is certainly part of a strategy: it is part of our industrial strategy to make sure that Britain is competitive in the future, as it is now and it has been in the past. We are taking a strategic approach. As the hon. Lady might imagine, I meet businesses large and small almost every day of the week, and in all the conversations I have, we discuss what is important, what challenges they face and what their strategic ambition is, so that I can be informed about that.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

I welcome the Nissan decision and congratulate the Secretary of State on his role in securing it. I especially welcome his comments about research and development, and innovation. Given that the developing industry-university collaboration is crucial to that, as is the role of foreign students and researchers, what assurances did he give the industry that the Government will reverse the drop we have seen in the numbers applying?

[Greg Clark]

The hon. Gentleman seems to think that my discussions went broader than they did, but with everything I have said about research and development, our universities are key to that. As a former universities Minister, and now once again with responsibility for science, I will do everything I can to promote our research excellence and make sure it continues.

[Stephen Gethins (North East Fife) (SNP)]

Universities in Scotland have warned of an exodus of talent if we do not have a long-term plan for EU nationals. What confirmation can the Secretary of State give that EU nationals will have a long-term future in this country?

[Greg Clark]

As the hon. Gentleman knows, there will be lots of opportunities to discuss other aspects of the negotiations we will have—I think there is even a debate next week on these matters.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I also welcome the announcement by Nissan and acknowledge the work of the Government, Unite the union, and others who were involved in this decision. One of the reassurances the Secretary of State mentioned related to support for the skills and training of the local workforce and for research. Does he expect any cuts in research and development and skills support from the EU to UK regions and businesses? What reassurances has he given that could also be applied to other sectors and regions to assure them that they will not lose out?

[Greg Clark]

As the hon. Lady knows, the Chancellor has already made a commitment to continue that European funding that has already been committed to but, of course, much of the support that we have given to training and skills development in the automotive sector is from our own resources, and one of the things that I was able to say was that we regard that as important and continuing.

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

We know that there are attempts to do a deal for the City of London and we now know there is a deal for Nissan. At the same time, however, the Fraser of Allander Institute tells us there is a threat to 80,000 jobs in Scotland. Why is it that, when our First Minister comes down here, she is shown the door? There is a deal for Nissan, but there is no deal for Scotland from this Government.

[Greg Clark]

I have had the pleasure of meeting the First Minister at least twice since I took up this job. What I have said to her, personally and directly, is that, as we develop our industrial strategy, Scotland will have a big place in that. Of course it is important that all parts of the United Kingdom need to benefit from our industrial success in the future. The hon. Gentleman may know that, in terms of the city deals that have been negotiated between the UK Government, the Scottish Government and the various councils, we have, and I personally have—I think he would acknowledge this—a track record in making those discussions work.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

I certainly welcome the news, and I am sure that the thousands of people who work at the Vauxhall car plant in my constituency would be equally delighted if a similar announcement could be made in due course. When the Secretary of State addressed the Chamber, he referred to different strategies for different industries, but does he also accept that, within the UK automotive sector, there are different challenges from plant to plant, and that a more specific approach may be needed from time to time? Will he agree to engage in an intimate dialogue with General Motors, as he has with Nissan?

[Greg Clark]

I am not sure I would describe the dialogue as intimate, but it was constructive at any rate. Of course I make that commitment to the hon. Gentleman.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Around 200,000 jobs in Wales are reportedly sustained by single market membership. With the UK Government so far picking the automotive and the financial sectors as their Brexit winners, how many of the aforementioned 200,000 Welsh jobs does the Secretary of State think will ultimately be safe after Brexit?

[Greg Clark]

We are at a point where we have not begun the negotiations with the European Union, much less concluded them, but the demeanour I think we should take is one of looking positively to find common ground and interests. That, always and everywhere, is the basis of a good deal—identifying that common ground and, through civility and patience, establishing relationships that can lead people to conclude something that is in their mutual interest. That seems to be a good way to approach these discussions.

[Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)]

The Secretary of State said that employees of Nissan could look forward to careers filled with opportunity and success, yet millions of young people throughout the UK are looking at futures with significantly reduced opportunities as a result of Brexit. What reassurance can the Government give to young people about what they will do to protect those people’s futures?

[Greg Clark]

We have been discussing a fantastic new investment that not only will safeguard jobs in Nissan and across the country, through the supply chain, but will, no doubt—especially with more of the supply chain coming to locate in the United Kingdom—create new opportunities. Those opportunities will be for young people right across the country. There will be apprenticeships, traineeships and careers available that would not have happened if we had not secured this investment, so the hon. Gentleman should welcome it.

[Kelvin Hopkins (Luton North) (Lab)]

Nissan’s decision is brilliant news not only for the north-east, but for the whole UK. May I suggest to the Secretary of State that the exchange rate is a major and crucial factor in Britain’s competitiveness, and that maintaining an appropriate exchange rate is fundamental to future manufacturing success and investment? Will the Government be taking steps to make sure that the welcome depreciation of sterling since 23 June is maintained?

[Greg Clark]

As the hon. Gentleman knows, we have not targeted an exchange rate for some time. That policy is, first, not my remit and, secondly, not the way we approach the economy. However, it is true that there are many contributors to the competitiveness of the economy. What I need to do, and what I will do, is to take those things over which I do have influence and make them work for Britain.

[Sammy Wilson (East Antrim) (DUP)]

The Nissan announcement is not, of course, the only announcement of a good investment decision in the UK since the referendum. From GlaxoSmithKline to McDonald’s, thousands of jobs have been created, despite the predictions of the doom-mongers on the referendum deniers’ side. The Minister has indicated that he will take a sector-by-sector approach. Does he also reckon that there needs to be a region-by-region approach, and what plans does he have to meet the Economy Minister in Northern Ireland to discuss the problems there?

[Greg Clark]

I have already met the Economy Minister in Northern Ireland and had a very constructive discussion with him. I had that discussion to invite him to help us as we develop our industrial strategy so that it includes an appreciation of the different needs of different places to which the hon. Gentleman refers.

[Joanna Cherry (Edinburgh South West) (SNP)]

I welcome the news that so many jobs in Sunderland will be protected from the consequences of Brexit but, as an Edinburgh MP, it is Edinburgh jobs that I have to think about. Many thousands of my constituents are employed directly or indirectly in Edinburgh’s financial sector, and Edinburgh’s economy is more reliant on financial services than that of any other city in the UK, including London. These people are worried about the consequences of losing their EU passport. Will the Minister give me a guarantee that he will advocate a special deal for Edinburgh in Cabinet?

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[Greg Clark]

Of course financial services are of huge importance to our economy—to the UK economy and to the economy in Edinburgh. We need to make sure that, in all areas, we get the best possible deal by finding areas of common ground and negotiating constructively, through relationships that we have built up with our counterparts in the European Union, during the months and years ahead. That is the approach that we will take, and it is the approach that is most likely to succeed.

[Mrs Madeleine Moon (Bridgend) (Lab)]

On Friday, I am due to visit the Ford engine plant in my constituency, along with my local Assembly Member, Carwyn Jones, the First Minister of Wales. Can we be assured that we will be talking to Ford on the same lines as have been very successfully negotiated in relation to Nissan, and that the 2,000 jobs at the Ford plant and in the wider economy will also be secure following today’s statement?

[Greg Clark]

I do not know what the hon. Lady is going to say to Ford, but I hope that she will reinforce the messages that I have given in saying that the Government want to maintain the competitiveness of the whole automotive sector. We want to build on the strengths that it has in every part of the United Kingdom, including in her constituency, so that it can prosper in the future. I hope that that will be welcomed.

[Ian C. Lucas (Wrexham) (Lab)]

As a former Labour Minister with responsibility for the automotive sector, I welcomed the investment by Nissan for the manufacture of the electric Leaf vehicle in Sunderland, although I did not give a statement from the Dispatch Box at the time because that was probably less of a surprise. How will the Secretary of State secure attendance in the emissions regulation discussions that are so vital to the low-carbon future of the UK automotive sector?

[Greg Clark]

They are indeed vital, and I am delighted that the hon. Gentleman makes that point. One of the advantages of having responsibilities for energy and climate change within the business and industrial strategy set of responsibilities is that these conversations can be joined up. The Minister for Climate Change and Industry and I share an interest in making sure that we maintain our leadership in green technology to the great advantage of our industrial future.

[Patrick Grady (Glasgow North) (SNP)]

How many of these unique, one-off, special, individual deals will have to be negotiated before the Brexit process is complete, and how many will it take before the Government realise that the better option for everyone would be to live up to their manifesto promise and keep us in the single market?

[Greg Clark]

It was not clear from the hon. Gentleman’s remarks whether he welcomes this deal, which has been a good conclusion to our discussions with Nissan. I would say to hon. Members on both sides of the House that if we all approach the prospect of investment—either by domestic companies or overseas investors—positively, try to understand what companies need, and make sure that the economy provides the backdrop, whether in skills, infrastructure or research and development, to keep us competitive, we can all prosper together.

Hinkley Point C

Greg Clark Excerpts

Thursday 15th September 2016 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

With permission, Mr Speaker, I shall make a statement on the Hinkley Point C nuclear power station.

As the House knows, on 28 July, following a decision by the board of EDF to approve the final investment decision on the £18 billion project to build a new nuclear power plant in Somerset, I announced that the Government would consider all elements of the project carefully before entering into a contract with EDF, and that we would make a decision by the early autumn. I can announce today that the Government have decided to proceed with the first new nuclear power station for a generation. However, that decision includes two important changes.

On the Hinkley project itself, the Government will now be able to prevent the sale of EDF’s controlling stake before the completion of construction. That agreement will be confirmed in an exchange of letters between the Government and EDF. Existing legal powers, and the new legal framework, will mean that the Government can intervene in the sale of EDF’s stake once Hinkley is operational.

Furthermore, and even more important, we will reform the wider legal framework for future foreign investment in British critical infrastructure. Those reforms will have three elements. First, after Hinkley, the British Government will take a special share in all future nuclear new build projects. That will ensure that significant stakes cannot be sold without the Government’s knowledge or consent. Secondly, the Office for Nuclear Regulation will be directed to require notice from developers or operators of nuclear sites of any change of ownership or part-ownership. That will allow the Government to advise or direct the ONR to take action to protect national security as a result of a change in ownership. Thirdly, the Government will significantly reform their approach to the ownership and control of critical infrastructure to ensure that the full implications of foreign ownership are scrutinised for the purposes of national security. That will include a review of the public interest regime in the Enterprise Act 2002, and the introduction of a cross-cutting national security requirement for continuing Government approval of the ownership and control of critical infrastructure.

Those changes will bring Britain’s policy framework for the ownership and control of critical infrastructure into line with those of other major economies, which will allow the Government to take a fair and consistent approach to the national security implications of critical infrastructure, including nuclear energy, in the future. The changes mean that, while the UK will remain one of the most open economies in the world, the public can be confident that foreign direct investment always works in the country’s best interests.

This £18 billion investment in Britain provides an upgrade in our supply of clean energy. When it begins producing electricity in the middle of the next decade, it will provide 7% of the UK’s electricity needs, giving secure energy to 6 million homes for 60 years. Furthermore, it must be stressed that the contract negotiated places all the construction risk on investors alone. Consumers will not pay a penny unless and until the plant generates electricity.

The proposed strike price of £92.50, which will be reduced to £89.50 if Sizewell C is built, contains important elements of insurance against any cost overrun in construction and future high gas prices, which have historically been volatile. It compares broadly with the costs of other clean energy such as offshore wind with the additional costs of intermittency, or gas with carbon capture and storage.

Hinkley unleashes a long overdue new wave of investment in nuclear engineering in the UK, creating 26,000 jobs and apprenticeships and providing a huge boost to the economy, not only in the south-west but in every part of the country, through the supply chain of firms, big and small, that will benefit from the investment.

EDF has also confirmed that UK businesses are set to secure 64% of the value of the £18 billion investment being made—the biggest single capital project in the UK today. However, as it is the first of a wave of new nuclear plants, we expect the experience of rebooting the nuclear industry to mean that costs should reduce for future new nuclear power stations, another five of which are proposed.

In any consideration of nuclear power, safety will always be the No. 1 consideration. The construction of Hinkley Point C will be under the close scrutiny of the Office of Nuclear Regulation, which is independent of the industry and Ministers. It has the power necessary to halt construction or require amendments to any part of the plant if at any point it is not completely satisfied with the safety of any part of the reactor and its associated construction. Unlike in the past, the long-term decommissioning costs for the plant will be provided for explicitly as part of the funded decommissioning programme, and at a level that has been assessed independently as prudent and conservative.

Any investment that provides significant electricity supplies for the next two generations of British people and businesses requires and deserves serious consideration. It was right that the new Government should have taken the time to consider all components of the project. Having reviewed the project, the Government are now satisfied that the improved deal and the other changes announced today will, for the first time, remedy the weaknesses of the previous regime for foreign ownership of critical infrastructure. It is important that the right balance is struck between welcoming foreign investment and ensuring that it serves the national interest. That is exactly what these changes will achieve.

The investment will secure 7% of the UK’s electricity needs for 60 years, helping to replace existing nuclear capacity that is due to be decommissioned in the decade ahead. The electricity generated will be reliable and low carbon, and therefore completely compatible with our climate change obligations. Hinkley Point C will inaugurate a new era of UK nuclear power, with UK-based businesses benefiting from almost two thirds of the £18 billion value of the project, and 26,000 jobs and apprenticeships will be created. All these developments are good for Britain. It is now right that we support this major upgrade —the first of many—to the infrastructure on which our future depends. I commend this statement to the House.

--- Later in debate ---

[Mr Speaker]

Order. I think that the hon. Gentleman has concluded his remarks, because his time is up.

[Greg Clark]

The hon. Gentleman raised a large number of points, and I will address them. I hope that we share the view that a confident, long-term energy policy is vital to ensuring that people have access to secure energy that is affordable and clean, and that we should be a world leader in these important energy industries. I hope that he will not think it churlish of me to point out the complete absence of a long-term energy policy during Labour’s 13 years in government, when our nuclear fleet was known to be coming to the end of its life, yet no decision was taken to replace it. It has fallen to this Government to make the long-term decisions for the security of this country. Instead of making like the ostrich and hoping that the problem would go away, this Government are looking to the future, providing the upgrade to our long-term energy security that we need.

With regard to the hon. Gentleman’s position today, I am afraid that I am as confused as ever. His position is no more credible. He seems to be criticising the Prime Minister and the Government for taking the serious decision to review the components of a very important deal—that seems to be the import of his remarks. He said that this had damaged confidence, but when the announcement was made on 29 July, he told the BBC:

“I’m hoping what they will do is take two to three months to seriously review it”.

So much for the suggestion that we should not have had the review in the first place—although I am not sure what the purpose of that two or three months would be, because the very same day he said that he had already made his mind up. He said that he would not scrap the proposal

“because I welcome the jobs and I welcome the 7% of electricity that this will produce for the nation.”

That is from the hon. Gentleman who was urging the Government to take longer to review something, the conclusions of which he had already agreed in the first place. The contrast between that and the seriousness and forensic approach of the Government is marked.

I will address the points that the hon. Gentleman has raised. The powers under the Enterprise Act are subject to takeover thresholds. We are ensuring that any change in ownership or control, of whatever size, will be covered by a national security test. That seems to be sensible.

On Hinkley, until we proposed these changes to the contract, EDF was at liberty to sell its majority stake in that important investment without even needing the permission of the UK Government. Therefore, it seems sensible and prudent to have agreed straightforwardly with EDF that the UK Government’s consent should be required.

I am surprised that the hon. Gentleman, who I would have thought would take a prudent view of matters of national security, should suggest—again, it is not clear—that we should not make these changes. When we debate these matters, he will be able to set out whether he opposes the measures we are taking to safeguard and entrench the same regime for national security in this country that other advanced economies enjoy.

I was clear in my statement that this is the first of what we hope will be a series of new nuclear investments. Just about 20% of power is generated by nuclear. It is important that there is another contribution to a diverse energy mix from nuclear. In so doing, we create new jobs, new opportunities and major advances for the UK economy.

[John Redwood (Wokingham) (Con)]

I welcome proposals to make it more difficult for foreign interests, especially nationalised industries and Governments, to buy our crucial infrastructure. Does the Secretary of State agree that future power stations would be much better financed by private sector British investors or even on occasion by Treasury investment, rather than foreign investors, who will be able to take enormous sums of money out of our country for 25 years or more while the project is up and running, which is a cost on the balance of payments that we do not want?

[Greg Clark]

I welcome overseas investment of £18 billion in the UK economy. I hope that, as we develop our nuclear programme and skills and as the supply chain prospers, British companies will invest in the various parts of the new nuclear supply chain. In fact, we expect that to happen, with 64% of the value going to UK companies. However, it is an important part of the deal that the consumer and taxpayer will not pay a penny for construction costs unless and until the plant generates electricity. Knowing the record of cost overruns and delays to new nuclear power stations, I think it is prudent that that risk be held by the investors, rather than the taxpayer.

[Callum McCaig (Aberdeen South) (SNP)]

I thank the Secretary of State for an advance copy of the statement, and I thank his Energy Minister for the courtesy call this morning to explain the Government’s decision. I welcome the fact that we have had the statement before the recess to allow the opportunity for questions. It is unfortunate, however, that the Government have decided to take the gamble with Hinkley. The Secretary of State has outlined improvements, but the deal remains a rotten one; it will cost the bill payer £30 billion. He may say that the risk is with EDF and the construction companies, but, as Barclays outlined, if Hinkley Point C is 25% over-budget and four years late, EDF will still make a profit, at the expense of the bill payer.

If we do not pay a penny until Hinkley is built, or if it is built late, what will fill the gap? We know that coal is due to come off the system by 2025, when this project is meant to come on. If the gap is five years, what will fill it and at what cost? The cost of the project—Hinkley Point C will possibly be the most expensive object in history—is too much.

The opportunity cost is also a concern: we cannot spend the money twice; we cannot have the engineers working on things twice; and we cannot have the grid producing the electricity to be consumed twice. We could spend the money better. We could use our expertise better to develop an industrial strategy. The Government have said that that is part of their new policy, but that industrial strategy will mean foreign ownership, investment and profit. Instead we could develop the home-grown industries, which would see our country flourish, by investing in clean carbon capture, offshore wind, storage and solar. It would be better to invest in those things. I ask the Secretary of State to invest in the energy of the future, not the energy of the past.

[Greg Clark]

I am grateful for the courteous words with which the hon. Gentleman started his remarks. He talks about investing in energy sources of the future, rather than those of the past. I gently point out to him that, given the SNP’s record on energy forecasts in recent months, SNP Members might keep their crystal balls to themselves, if I can put it that way.

On the hon. Gentleman’s injunction to invest in renewables, that is very important. He will know that Scotland has a high proportion of renewable investment. However, I am confused by his party’s position. As I understand it, the SNP has stood on a platform of a nuclear-free Scotland but, it seems to me, with its fingers crossed behind its back, because it is happy to rely on the two nuclear power stations functioning in Scotland—Hunterston B and Torness—that are producing low-carbon electricity. Indeed, a former leader of the SNP wrote to EDF to say that he was happy to extend the life of the two power plants well into the 2020s. Therefore, he wants to condemn his cake and eat it, and then have another slice.

We do want to attract overseas investment into this country. It is a vote of confidence in this country that investors are working with us to have this major uprating of our infrastructure. We welcome that across different sectors. The hon. Gentleman is wrong that that is at the expense of other opportunities in this country. One of the features of the deal is that it does not burden the public balance sheet. The Chancellor of the Exchequer and the Chief Secretary to the Treasury have wisely ensured that the UK balance sheet remains able to support other investments, because this will be provided through private investment.

[Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)]

Mr Speaker, with your indulgence, may I thank the Secretary of State and the Prime Minister for making exactly the right decision? I emphasise how important this is for the Bridgwater and West Somerset constituency. I invite the Secretary of State to come down as soon as he practically can to visit the Hinkley Pont C nuclear power station. Will he look with some urgency at the nuclear college that we urgently need to build at Cannington? Further to the letter that I sent him from the local enterprise partnership, we need the last bit of the funding to ensure that the infrastructure to deal with the project in the local area is up to scratch and we can deliver the power plant on time and on budget, for the benefit of the UK.

[Greg Clark]

I return the compliment and thank my hon. Friend for his level-headedness and patience, while the review has been conducted. It is an extremely important investment for his area. I am looking forward greatly to going with him to visit Hinkley. He is right. Investment such as that in the college will provide the skills that will charge ahead the whole of the south-west and, indeed, the rest of the country. The supply chain extends to all parts of the UK. My right hon. Friend the Member for West Suffolk (Matt Hancock) will also be a beneficiary of the project. It requires an upgrade to the local infrastructure, and I will respond to the LEP on that. Earlier this week, I had a positive conversation with the Somerset chamber of commerce. It was clear that the benefits of what was then a proposal would be considerable —in fact, game changing—for Somerset.

[Mr Ben Bradshaw (Exeter) (Lab)]

The Secretary of State will be aware that Britain’s two most respected economy and finance publications, the Financial Times and The Economist, have both come out strongly against Hinkley C on value for money and on energy policy grounds, with The Economist describing it just last month as a white elephant before it is even built. Can he confirm that nothing that he has announced today is an improvement on the dreadful deal negotiated by the former Chancellor on the guaranteed price? Absolutely dreadful.

[Greg Clark]

I do not agree with the right hon. Gentleman. It is a good deal that will secure 7% of our energy into the future. Given that 20% of our nuclear capacity will be decommissioned over the next 10 years, it is incumbent on him and his hon. Friends to tell us how they would replace it if they are not going to be forward looking and make positive decisions such as those that we have made.

[Mr John Whittingdale (Maldon) (Con)]

I welcome my right hon. Friend’s statement, which is good news for the energy sector and for my constituents in Bradwell-on-Sea. I can assure him that they welcome the prospect of Chinese investment in the Maldon district, where there is a long history of nuclear power generation. Does he agree that any future power station should be regulated by the UK inspectorate and staffed by British employees and that the cyber-security evaluation centre, which assesses technology supplied by Huawei for the telecoms sector, sets a good precedent for addressing any security concerns?

[Greg Clark]

My right hon. Friend is absolutely right. It is important that we should welcome overseas investment, but we should also have the kind of regime and powers that other advanced economies benefit from. That is something that mature countries would expect to have, and that is what we are going to have as a result of these changes.

[Tom Brake (Carshalton and Wallington) (LD)]

Having pressed the pause button, why is the Secretary of State now pressing the fast-forward button? Does he not recognise that, as the Financial Times has pointed out, this project does not represent value for money? Does he accept that the cost to consumers has gone from £6 billion to £30 billion and that his Government are now willing to put in public subsidy, which, under the coalition, they said they would not do? Also, this is happening at a time when the cost of renewables is plummeting.

[Greg Clark]

No, I have said that the construction costs will be entirely financed by the private investors in the site. It is important that we take a consistent long-term approach to energy policy, and in so far as this can be cross-party, that will be beneficial. It is especially ironic that two Liberal Democrat Energy Secretaries were closely involved in the negotiation of this deal. The right hon. Gentleman obviously takes a different view.

[Zac Goldsmith (Richmond Park) (Con)]

Can my right hon. Friend confirm that, by the end of its life, this new power plant will have generated the most expensive energy in the history of energy generation? Does he agree with the National Audit Office that, by that point, consumers will have ended up subsidising EDF to the tune of £30 billion? Finally, can he tell us what is going to happen to the mountains of nuclear waste that this plant will generate?

[Greg Clark]

Securing a reliable source of energy for 60 years is a good investment in the future stability of our energy supplies, and that is worth having. Of course it is impossible to know what the alternatives will be during that time. We have seen very volatile energy prices. Sir Winston Churchill’s principle on energy security was that diversity, and diversity alone, was the key. I think that that is the right approach. I said earlier that decommissioning was provided for explicitly in the contract.

[Kerry McCarthy (Bristol East) (Lab)]

EDF says that this will mean 1,500 jobs in offices in Bristol, as well as those associated with the plant, and I am meeting representatives of the company on Monday at Hinkley to discuss that, but these will be incredibly expensive jobs, given what we have already heard about the deal. Does the Minister really think that this is value for money? Would it not be better spent by investing in the renewables sector, which would also provide jobs in the south-west?

[Greg Clark]

I am slightly confused by the Opposition’s demeanour. In his rather confusing reply, the shadow Minister seemed to welcome the fact that the project was going ahead. Certainly, the trade unions in the south-west and across the country, which I imagine the hon. Lady speaks to, are very positive about it. The national secretary for energy for the GMB has said:

“Giving the thumbs up to Hinkley is vital to fill the growing hole in the UK’s energy supply needs.”

Frances O’Grady of the TUC has also welcomed the announcement. When the hon. Lady goes back to her constituency this weekend, perhaps she might like to talk to some of the unions, which are delighted on behalf of their members.

[Kevin Foster (Torbay) (Con)]

I welcome this announcement, which will bring £465 million-worth of contracts to businesses in the south-west and a £4 billion boost to the economy of the south-west. Does the Secretary of State agree that we need to look at these decisions in the context of the fact that we have a fleet of nuclear power stations dating back to the 1960s and 1970s that will close over the next 10 years? These are not either/or decisions: we need both kinds of energy provision.

[Greg Clark]

That is exactly why long-term planning is essential. As I have said, about 19% of our electricity is generated by nuclear power, and if we do not renew it, that figure will fall to 2% by 2030. It seems to be prudent to get on with replacing it.

[Sue Hayman (Workington) (Lab)]

Iwelcome this decision. It has been a long time coming, and it is a shame that it is been delayed over and again. I hope that Moorside power station will be built in the not-too-distant future. It will be incredibly important for economic development in my constituency. Can the Secretary of State assure me that the nuclear renewal programme will not be beset by delays?

[Greg Clark]

One of the reasons that we are so keen to inaugurate this new programme of nuclear engineering in this country is our need to replace the nuclear power stations that are being decommissioned and to build up in constituencies such as that of the hon. Lady the skills that can make a valuable contribution to local life and to the national economy.

[Chris Green (Bolton West) (Con)]

I welcome this start to the building of the new fleet of nuclear power stations and the opportunity that this will provide for British manufacturing. Will my right hon. Friend do all that he can to ensure that, in these deals, we buy the best of British?

[Greg Clark]

I will indeed. In the past 24 hours, EDF has made a commitment to me that 64% by value of the content will be spent with UK companies. That shows the tangible benefits to the whole economy of this programme.

[George Kerevan (East Lothian) (SNP)]

The Minister has said that the Hinkley decision will not burden the national balance sheet. Can he clarify the status of the offer made by the previous Chancellor of the Exchequer to give EDF a Treasury guarantee of £2 billion to supplement the company’s liquidity? The National Audit Office has said that that offer puts the taxpayer at risk.

[Greg Clark]

I am delighted to answer that question. In fact, EDF has confirmed to me that it will not be taking up that £2 billion guarantee, so the taxpayer is fully insulated from the costs of construction.

[Mr Alan Mak (Havant) (Con)]

I welcome the Secretary of State’s statement today. Can he confirm that he will continue to work with business groups such as the China-Britain Business Council and the French Chamber of Commerce in Great Britain to ensure that we build on this nuclear partnership and attract future investment into the UK?

[Greg Clark]

I will indeed. We want to have good investment opportunities for countries around the world, and China has been an important and valued source of investment right across the United Kingdom. It is important that we build on that.

[Diana Johnson (Kingston upon Hull North) (Lab)]

In the light of the announcement today, is the Secretary of State now admitting that when the Government entered into the original contract, they failed to protect national security and critical infrastructure?

[Greg Clark]

Despite the injunction of the hon. Lady’s colleague on the Front Bench, the hon. Member for Brent North (Barry Gardiner), I can tell her that taking the opportunity seriously to review these matters before signatures were given has allowed us to improve the security of the arrangements. That seems to be a wholly good thing that I hope she will welcome.

[Mark Menzies (Fylde) (Con)]

The Secretary of State is quite right to point out that nuclear energy provides a valuable part of UK energy security, but it is dependent on having the fuel to put into the system. The fuel for reactors in the UK is made in my constituency. Will he assure me that all efforts will be made to ensure that nuclear fuel for new reactors in the UK will be made in the UK whenever possible?

[Greg Clark]

Indeed, and I would be happy to visit my hon. Friend’s constituency see the production facilities for myself.

[Matthew Pennycook (Greenwich and Woolwich) (Lab)]

I very much welcome the review, but I am astonished that a review of the strike price was not part of it. The strike price will rise to close to £120 per MWh by the mid-2020s, and it will rise with inflation thereafter. Will the Secretary of State tell us whether a serious examination of the cost and value for money for bill payers was part of the review?

[Greg Clark]

Of course we looked at every component part. To construct a new nuclear power station, the first for generation in this country, at no risk to the taxpayer or the bill payer is a considerable achievement and represents good value.

[David Morris (Morecambe and Lunesdale) (Con)]

This is good news for my constituency, as we are now going to have a third nuclear power station built. Good news travels fast, and I have already had the local radio station desperate to get an interview with me. I should like to congratulate the Secretary of State on all his hard work and thank him for what he has done for my constituents. Will he agree to meet me shortly to discuss how we can speed up the decisions on the five proposed reactors, and will he also help me by discussing Heysham as soon as possible?

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[Greg Clark]

I am happy, as always, to meet my hon. Friend, so he can consider the invitation accepted.

[Mr Peter Bone (Wellingborough) (Con)]

We have an excellent Secretary of State who came to this House and made a full statement. He quite rightly gave the details of the statement to the Opposition and SNP spokesmen, but he also gave them in advance to the BBC. I read all the details on the BBC website. That is not how this House works. It may be that the pressure of spin doctors is still prevalent in Departments. That must stop. The House must be informed first. Does the Secretary of State agree that that is the convention of this House?

[Greg Clark]

I understand my hon. Friend’s point. I hope that he will concede that I have come to the House at the earliest opportunity. Such decisions have consequences for financial markets, and it is the norm to disclose such decisions at the opening of the markets. He can rest assured—I am sure that he will accept this—that my sense of responsibility to the House is clear in my mind, but the conduct of business must be orderly when it comes to the implications for financial markets.

[Jeremy Lefroy (Stafford) (Con)]

I welcome the announcement about the golden share and support what my right hon. Friend the Member for Wokingham (John Redwood) said about future British investment, perhaps through a UK investment bank or UK pension funds, being important. Will the Secretary of State confirm where the currency risk will arise, in particular, for future subsidy payments out of the contracts for difference?

[Greg Clark]

The contract is expressed in pounds. The construction risk is entirely with the investors.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

I welcome the long-term investment in low-carbon energy and the creation of 25,000 jobs. Will the Secretary of State confirm EDF’s commitment to local jobs and to small and medium-sized businesses in the supply chain, such as James Fisher Nuclear in my constituency?

[Greg Clark]

I am sure that that firm will attest to that. The Somerset chamber of commerce was clear that the orders that had already been placed during the preparation of the site have been beneficial to the county.

[Tom Pursglove (Corby) (Con)]

This is obviously a massive infrastructure project, and I welcome what the Secretary of State has had to say about the opportunities for UK supply chains. I hope that those opportunities will be extended to the steel industry. I strongly urge the Secretary of State to get out there and make the case that all the steel used in the project should be British. May I put in a plug for Corby tubes?

[Greg Clark]

They are of excellent quality. The commitment given to me by EDF that 64% by value of the work will be with UK firms will be of particular benefit to such firms and to the supply chain right across the country.

Oral Answers to Questions

Greg Clark Excerpts

Tuesday 13th September 2016 Commons Chamber

[Caroline Ansell (Eastbourne) (Con)]

13. What steps his Department has taken to engage with British businesses since the EU referendum.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

Since I was appointed on 14 July, my colleagues and I have during the summer met businesses, investors, workers and local leaders in all four home nations, as well as travelling to India and Japan. Furthermore, and for the first time, each local enterprise partnership area and each of the devolved Administrations will have a specific Minister in my Department assigned to them. Personal relationships matter in business, and that should start with the Business Department.

[Ben Howlett]

I thank the Secretary of State for his answer, and I welcome the whole team to the new Department. The aerospace industry is absolutely vital to the west of England economy not just for jobs, but for growth. Will the Secretary of State work with me to ensure that the entire aerospace industry receives the support it requires and deserves?

[Greg Clark]

I certainly will do that. One of the biggest privileges of this job is to be reunited with aerospace; I got to know the sector when I was Science Minister. In fact, my first ministerial meeting was to have breakfast with the aerospace growth partnership at the Farnborough airshow, where I ran into my hon. Friend the Member for Aldershot (Sir Gerald Howarth). The west of England was very well represented there. For example, Katherine Bennett of Airbus, whom I am sure my hon. Friend the Member for Bath (Ben Howlett) knows well, one of the founder board members of the West of England LEP, was there. This is a very important sector for the economy, and it will have my wholehearted support.

[Kelly Tolhurst]

I, too, welcome the new ministerial team. I have a number of correspondents in a few local—predominantly small—businesses in Rochester and Strood who have been trading with European partners over a long period, but whose supply chain costs have recently risen. Will my right hon. Friend outline his commitment to supporting our small businesses in our new relationship with Europe, to ensure that local and regional economies continue to grow?

[Greg Clark]

I will, indeed. I know many of the small businesses in my hon. Friend’s constituency. Of course, through the British Business Bank, we have made over £3 billion available to smaller businesses. She will know that, from next April, small business rate relief will double permanently, which will benefit 60,000 small businesses. This is part of our continuing commitment to small business, which is the motor of the bigger businesses that, together with small businesses, generate so many jobs in our economy.

[Caroline Ansell]

My home constituency of Eastbourne and Willingdon is a long-established, beautiful seaside destination, with big future ambitions, including for a new hot air balloon festival in 2017. Tourism is the lifeblood of my town, and I am delighted to be welcoming the Eastbourne Hospitality Association to Parliament today. Will the Secretary of State tell me whether he has had discussions with the tourism industry about reducing the level of VAT on tourism services, to bring us into line with competitor destinations in the EU, and to give our industry a competitive platform from which it can stimulate investment, create jobs, deliver growth and take full advantage of the opportunities in life after Brexit?

[Greg Clark]

My hon. Friend is a big campaigner for the tourism industry. I welcome her visitors today, as I am sure the whole House does. We have the highest VAT threshold in the European Union, so many small businesses do not need to charge VAT. But I will continue discussions with her—the hot air balloon festival sounds a very tempting excursion, perhaps for many Members. I look forward to continuing these discussions with her and her colleagues.

[Derek Twigg (Halton) (Lab)]

Does the Secretary of State agree with his right hon. Friend the Member for North Somerset (Dr Fox) that British business people are fat, overweight and spend too much time on the golf course? [Interruption.] And lazy.

[Greg Clark]

I have yet to meet a lazy business person, starting with my own father, who was up before dawn every morning running his own business. But my right hon. Friend is right to remind us that, across the whole country, every business needs to work hard, as they do, every day of the week. That is the secret of our competitive success, and it is how we will continue to prosper as a nation.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

In light of comments made last week by the Japanese ambassador, the Secretary of State will be aware that Nissan, which is based in my constituency, contributes £2.1 billion to the UK balance of trade, and exports 80% of all cars made at its plant in Sunderland. What opportunities does he see for automotive companies such as Nissan in a post-Brexit industrial strategy, and will he commit to meeting Nissan as soon as possible?

[Greg Clark]

I not only make that commitment but can tell the hon. Lady that I have already done that, and have also met the Japanese ambassador. The automotive sector, and Nissan in particular, is a hugely important and valued part not only of her constituency but of the whole country. It has our full-hearted support. The ambassador and I have met twice. It is correct and encouraging that the Japanese ambassador, on behalf of the Japanese Government, shares with us their priorities for our negotiation. That is exactly the sort of relationship that I hope and expect to have with our partners around the world.

[Mr Ben Bradshaw (Exeter) (Lab)]

The Secretary of State will be aware of the great anger felt by Britain’s wealth creators at the comments of his right hon. Friend the International Trade Secretary, which were damaging not just to them but to our reputation abroad. What conversations has the Secretary of State had with his right hon. Friend and with the Prime Minister about limiting that damage?

[Greg Clark]

My right hon. Friend has been vigorous during the summer in going around the world to promote the case for British business, as is his job. Opposition Members will have the support of everyone in this House if they join the efforts we are making to promote the great opportunities there already are in this country and the further opportunities to come.

[Chris Philp (Croydon South) (Con)]

18. Secretary of State, may I ask you whether you agree that free trade is at the heart of a prosperous economy? Will you and your Front-Bench colleagues be resisting any attempts to impose any form of protectionism when we come to negotiating future trade arrangements?

[Mr Speaker]

Order. The hon. Gentleman should try not to use the word “you” in the Chamber. Debate goes through the Chair. I am not expressing any view on these matters, but I think I know what the hon. Gentleman had in mind.

[Greg Clark]

Free trade courses through the veins of this country. It is one reason why we have been most successful. I was surprised to hear a commitment to free trade described as dogma last week. It is one of our strengths, and my hon. Friend has my absolute assurance that it will be very much to the fore of our reputation in the future as it was in the past.

[Bill Esterson (Sefton Central) (Lab)]

I welcome the Secretary of State to his new post. He certainly has his work cut out. Australia says that it will take at least three years after Brexit before a trade deal can be in place with the UK, while the United States, Japan and China have all expressed their views about the prospects for foreign investment and trade with the UK. What is he doing to get behind UK businesses and deal with the concerns of our international partners following the Brexit vote? He could not do better than to start by telling his Cabinet colleagues to get behind business and stop insulting it.

[Greg Clark]

I would be interested in the support of the Labour party for promoting British business around the world. The hon. Gentleman will know, from our previous work on local growth, that he will always have a willing ear and assistance from me in doing that. He was kind enough to welcome me; I welcome the Opposition Front Bench team. The hon. Member for Hemsworth (Jon Trickett) was my shadow in my role at the Department for Communities and Local Government. He has followed me here—perhaps he is not so much a shadow as a stalker, but I regard it as flattery. [Laughter.]

As I said in my initial answer, relationships are important. We can exchange letters and bits of paper, but it is important that we get to know well our partners around the world. I have done that and my colleagues have done that. As I said earlier, I visited our investors and manufacturers in Japan and India. I will continue to do so.

[Lucy Frazer (South East Cambridgeshire) (Con)]

23. Cambridgeshire is a net contributor to the Treasury, with 20,000 businesses generating revenues of over £30 billion. As local politicians, we have had cross-party meetings with business leaders about the implications of Brexit for our local economy. Will the Secretary of State visit the Cambridge Science Park in my constituency to discuss the implications?

[Greg Clark]

As my hon. Friend knows, I am a frequent and enthusiastic visitor to Cambridge. One of the important features of our industrial strategy is to have a clear recognition of the contribution and local leadership that different places bring. I have appointed the Minister for Universities, Science, Research and Innovation, my hon. Friend the Member for Orpington (Joseph Johnson), as the lead liaison for Cambridge, but I will of course be very happy to visit myself.

[Callum McCaig (Aberdeen South) (SNP)]

I, too, welcome the Secretary of State and his team to their positions. I agree that there are some challenges, one of which is the ballooning trade deficit that, in quarter 2 of this year, increased to £12.3 billion. This is a problem that is unlikely to be solved by withdrawal from the single market. Scotland voted to remain. Scottish business wants unhindered access to that single market. Will the Secretary of State support that, or is he in favour of the full English Brexit?

[Greg Clark]

I welcome the shadow Minister to his place. I think many of us on the Government Benches were impressed by his contribution to the debates last week—a clear rising star. He will know that I will work very closely, and the Prime Minister has committed to working closely, with the devolved Administrations to make sure our negotiating mandate reflects the needs of all parts of the United Kingdom. It was a United Kingdom decision to come out of the European Union and we will make the most of it together.

[Callum McCaig]

I thank the Secretary of State for that answer. The Scottish Government analysis of UK withdrawal from the European Union is that it could cost the Scottish economy at best £1.7 billion a year and at worst £11.2 billion a year. I repeat: will he make the case from his Department for continued membership of the single European market?

[Greg Clark]

I made clear in my earlier answer that free trade is what we want to see in this country. In furthering our discussions not only with the leaders of the devolved Administrations but with our business investors around the world, we will ensure that the negotiating mandate we have is ambitious and will secure the brightest possible future for the whole of the United Kingdom.

[Angela Crawley (Lanark and Hamilton East) (SNP)]

2. When the Government plans to make a decision on the timetable for the development of Hinkley Point C.

[Tommy Sheppard (Edinburgh East) (SNP)]

4. When the Government plans to make a decision on the timetable for the development of Hinkley Point C.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

I said on 28 July that the Government would carefully consider all the component parts of the Hinkley Point C proposed project before reaching a decision on whether to agree to the proposed contract for difference. We have been doing just that, and as the Prime Minister told the House last Wednesday, a decision will be taken this month.

[Angela Crawley]

On my recent summer surgery tour of my constituency, a number of constituents raised concerns about the cost to the taxpayer of the Hinkley Point C development. Barclays estimates that even if EDF delivers four years late and 25% over budget, it would still make a profit on the deal, with the deficit being picked up by ordinary people over the next 35 years. Does the Minister think that such a gratuitous public subsidy provides value for the taxpayer?

[Greg Clark]

As I said to the hon. Lady in my answer, we are looking at all components of the deal and will make our decision before the end of the month. However, I think it is a responsible act on the part of the Government to consider our energy supplies for the future in the long term. I know the Scottish Government have turned their face against new nuclear. We regard it as an important part of a diverse energy mix that gives resilience to UK consumers.

[Tommy Sheppard]

Given that the Brexit vote has thrown the energy sector into further uncertainty and given that we know that energy from renewable sources will be cheaper than nuclear by the time Hinkley is completed, is it not now time for the UK Government to follow Scotland’s example, end this unreasonable love affair with nuclear energy and embrace cheaper, safer and more plentiful alternatives?

[Greg Clark]

Sir Winston Churchill said that in energy, “diversity and diversity alone” was the foundation for security. I think those were wise words, and I think we are wise to have a range of energy sources now and in the future—including, of course, renewables.

[Sir Gerald Howarth (Aldershot) (Con)]

May I say how strongly I support the Prime Minister’s decision on this, given that China persists in trying to hack not only state agencies but our commercial companies and has put two fingers up to the arbitration court in The Hague, which ruled that the development for military purposes of uninhabited atolls in the South China sea was unlawful? These are people with whom we should sup with a long spoon. I commend to my right hon. Friend the paper written by the Intelligence and Security Committee under the chairmanship of Sir Malcolm Rifkind three years ago.

[Greg Clark]

I am grateful to my hon. Friend for his comments. He will know that the commitment we have made is to look at all components of the proposed deal and to make our decision very shortly. I shall of course report back to the House. when we have done that and explain the reasons why we have taken whatever decision we have.

[Sir Edward Leigh (Gainsborough) (Con)]

14. The Government are very wise to take a deep breath before committing themselves to the massive cost of Hinkley. Evidence on new technology is mounting all the time, relating in particular to fusion rather than fission, mini-reactors and battery storage. I commend the Government for considering the decision very slowly indeed.

[Greg Clark]

I am grateful to my hon. Friend. It is right when dealing with such an important decision to make sure that a new Government look at all the components with a view to the future for our energy supply. As I say, I believe it important to benefit from the full range of technologies, including some of those that my hon. Friend has mentioned.

[Mr Ben Bradshaw (Exeter) (Lab)]

rose—

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[Christina Rees (Neath) (Lab/Co-op)]

I congratulate Express Reinforcements Ltd, based in my Neath constituency, on becoming the preferred supplier for 200,000 tonnes of reinforced steel provided by Celsa Cardiff from Bylor to Hinkley Point C. I am concerned that Hinkley Point C has been hit by multiple setbacks and is on hold. Will the Secretary of State please update us on the timetable? Do we need a plan B or even a plan C?

[Greg Clark]

The hon. Lady is right that across all forms of energy generation we need to upgrade our capacity for it. Doing that—the Government are determined to do so—will secure important advantages for other companies, including steel suppliers, right across the United Kingdom. We will take the decision on Hinkley before the end of the month, as the Prime Minister has said.

[Mr John Whittingdale (Maldon) (Con)]

Notwithstanding his earlier remarks, will my right hon. Friend confirm that, as well as the proposed nuclear power station at Hinkley Point C, the other part of the package, which is a new Chinese-designed station at Bradwell-on-Sea, remains very much on the table?

[Greg Clark]

The decision with Hinkley Point C is on the particular contract for difference. That is what we are reviewing, and we will take the decision when that review has been completed.

[Barry Gardiner (Brent North) (Lab)]

I, too, welcome the Front-Bench Members to their new positions—along with my stalker friend. After putting 25,000 highly skilled jobs at risk and jeopardising 500 much needed STEM apprenticeships; after offending the Chinese Government and risking £18 billion of investment in the nuclear industry, which is a vital part of our energy mix; and after sending shockwaves through the investment community, which now thinks that the Prime Minister does not understand the meaning of fine investment decisions, does the Secretary of State agree with those in the industry who say that the Prime Minister’s cautious approach now looks more like dithering?

[Greg Clark]

I prefer the Prime Minister’s cautious approach to the approach of the hon. Gentleman, which, as far as I can see, is completely inconsistent. He criticises the Government for, quite rightly, reviewing this important decision, but at the same time he says that we should take two to three months to review the decision seriously, so there is a contradiction in his position.

That does not surprise me, however, in view of the complete absence of an energy policy during the 13 years of Labour government when we knew that nuclear power stations were going to come to the end of their lives. Those power stations were not replaced. The present Government are making decisions in a proper, serious way, and making up for the lost time during the Labour years.

[Nigel Huddleston (Mid Worcestershire) (Con)]

3. What steps the Government is taking to develop its industrial strategy; and if he will make a statement.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

I am delighted that the Prime Minister has asked me to lead the historic task of preparing a proper industrial strategy for our country. We have a once-in-a-generation chance to embrace the opportunities of our new global role, and to upgrade our economy so that it works for everyone. We will work with the breadth of British industry, local leaders, innovators, employees and consumers to create the conditions for future success.

[Nigel Huddleston]

May I, too, take the opportunity to congratulate the Front-Bench teams on their appointments?

The words “industrial strategy” often conjure up images of manufacturing and heavy industry. Can the Secretary of State confirm that the service sector, which, after all, constitutes 80% of the British economy, will also be comprehensively covered by this industrial strategy?

[Greg Clark]

I can indeed confirm that. In our projections of how we are to earn our living as a nation, we should look to our strengths. The service sector is undoubtedly one of our greatest strengths, and we must of course create the conditions that will enable it to continue to prosper in the future.

[Mr Iain Wright (Hartlepool) (Lab)]

I, too, welcome the Secretary of State to what is a fantastic, ambitious, interesting and challenging brief. I wish him and his ministerial team all the best. Will he now explain precisely how the new industrial strategy marks a distinctive change in the Government’s approach to collaboration with business and intervention in the economy—or is it merely a change to the nameplate at 1 Victoria Street?

[Greg Clark]

It is certainly not that. I would very much welcome the involvement of the new Select Committee which I expect to be formed in ensuring that we capture everything that we need to make a success of the strategy. I do not think that it is brand new, in the sense that, as I have said, we build on success. For instance, we talked to one of the hon. Gentleman’s colleagues about the automotive sector, which we know has been a significant source of strength. The environment that we have created with the firms in the sector, and with universities and scientific institutions, has been crucial to its success. We will build on those strong foundations, and will be very clear about our path for the future.

[Rishi Sunak (Richmond (Yorks)) (Con)]

As the Government formulate their industrial strategy, may I urge my right hon. Friend to look at the American small business innovation research programme, which funds research at the critical stage between science and the commercialisation of technology, and which has spawned companies such as Qualcomm, Jawbone and Tesla? Will he consider a United Kingdom equivalent?

[Greg Clark]

I am grateful to my hon. Friend, who is very well informed about the need to translate research success into small business success. I am sure that we can discuss it further.

[Chris Bryant (Rhondda) (Lab)]

17. I welcome the new team as well, although I suspect that even the Secretary of State knows that this is not going to be a full English Brexit, but a dog’s Brexit. [Interruption.] Thank you very much; I am here all week. As for the industrial strategy, one of the real problems facing many parts of the country—as was revealed at the time of the referendum—is that they are now post-industrial. They are areas that formerly had one industry, such as tourism, iron and steel, coal or shipbuilding. Will the Secretary of State ensure that we take the opportunity to invest in those forgotten areas, so that we can improve their productivity in particular?

[Greg Clark]

They are not forgotten. The hon. Gentleman is very good at one-liners. The creative industries are an important source of strength, and that includes comedians.

Some of the most successful places in the world, especially cities, have developed in such a way that they have resilience as a result of having different industries. That even applies to cities in which there was formerly a single dominant industry. We want to work with local leaders to ensure that we strengthen the resilience of our own regional centres.

[Mr Edward Vaizey (Wantage) (Con)]

I welcome the new Front Bench team, particularly the visiting fellow of All Souls, who is appropriately the Minister for the Oxfordshire local enterprise partnership, and the Minister for consumer affairs, who is a brilliant re-tweeter, particularly of my interview in today’s Times.

As part of the industrial strategy, I hope my right hon. Friend the Secretary of State will recognise the importance of science and innovation; in my constituency in Harwell we are a microcosm of the future of Britain, linking science with high tech, and I hope it will feature strongly in his industrial strategy.

[Greg Clark]

It certainly will, and the strength of science, not least in Oxfordshire, is one of our national strengths and it will be at the heart of our strategy.

[Ms Margaret Ritchie (South Down) (SDLP)]

How will the Secretary of State ensure the future industrial strategy is mindful of Northern Ireland’s particular reliance on EU support and access to the common market?

[Greg Clark]

As I said earlier, we will make sure we work with our colleagues across the United Kingdom. I had a very productive meeting with Simon Hamilton in the summer, to make sure we co-ordinate our efforts with those of policy makers in Northern Ireland. It needs to be joined-up and it will be, and we will make sure our negotiating mandate reflects contributions from across the UK.

[Jon Trickett (Hemsworth) (Lab)]

I join others in welcoming those on the Front Bench and the creation of a Department that is going to deal with industrial strategy. The country is badly unbalanced at the moment and we will support any realistic thorough-going industrial strategy that is developed.

We know how the strategy has gone over the summer—BHS has gone bust, with 11.000 jobs gone. Sports Direct is paying less than the minimum wage, world-leading company ARM, a home-grown British gem, has been sold overseas—and meanwhile one of the Secretary of State’s Cabinet colleagues has talked down British business, calling our companies fat and lazy, and there is still no clear and unambiguous progress on the steel industry. It has been over two years since the consultation on the steel industry pensions ended. When will the right hon. Gentleman make it clear that the pensions of tens of thousands of loyal and hard-working steel workers will be properly protected?

[Greg Clark]

The steel industry is a very important industry in our country. As the hon. Gentleman knows, I grew up in Teesside where it was particularly prominent. I had some productive discussions in the summer, including visiting south Wales to make sure the Government can give the right support to a sustainable future for the steel industry, and I am happy to make the hon. Gentleman aware of these discussions.

[Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)]

5. What steps he plans to take, and by what date, to improve the performance of the feed-in-tariff scheme for solar power.

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[Neil Parish (Tiverton and Honiton) (Con)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

The Department for Business, Energy and Industrial Strategy was formed on 14 July, and it is my great honour to serve as its first Secretary of State. Over the summer, rapid progress has been made in joining up responsibilities for business, energy, climate change, science, innovation and consumer affairs and in creating a new focus on industrial strategy. This is a powerful Department, which is up to the task of promoting a competitive, low-carbon economy that works for everyone. As part of an excellent team of Ministers and officials, I will continue to work both locally and globally on the challenges ahead.

[Neil Parish]

The Swansea bay tidal lagoon, along with Cardiff bay, Newport bay and Bridgwater bay, has the potential to create huge energy, as those bays have the second highest rise and fall of tide in the world. How is the feasibility study going, and when will we get a result? We need long-term funding for a project that will provide 8% of our energy.

[Greg Clark]

My understanding is that the feasibility study is being undertaken. I have not received its final conclusions yet. At that point, I will look at it with the same interest as my hon. Friend.

[Bill Esterson (Sefton Central) (Lab)]

The European Commission says that Apple should cough up £13 billion in taxes for earnings generated across the EU, including in the UK. Most UK businesses pay their fair share of taxes and expect all other businesses, large or small, to do the same. Will the Secretary of State confirm that he is doing everything he can to ensure that the very biggest companies pay up and that we receive our share of the £13 billion Apple tax pie?

[Greg Clark]

The hon. Gentleman makes a reasonable point. Responsibilities come with being in business in this country, and paying taxes to contribute to the public services that we enjoy is one of them. He has my assurance that we will ensure that we pursue the correct tax from all companies that locate here.

[Jason McCartney (Colne Valley) (Con)]

T3. On Thursday, I will be chairing a panel at the enterprise, innovation and northern powerhouse conference at Huddersfield university. Does the Secretary of State agree that in developing an industrial strategy, we need to do more to win hearts and minds for big projects in the north, with more examples of regional procurement, such as the High Speed 2 college in Doncaster, and more jobs in the north, perhaps with HS2 starting from the north?

[Greg Clark]

The passion with which my hon. Friend makes his point attests to the opportunities within our approach to industrial strategy to ensure that there is growth across the United Kingdom, including in Yorkshire. He will know that I have taken a great interest in that in my previous roles, and he can be absolutely assured that that interest will not diminish in the months ahead.

[Fiona Mactaggart (Slough) (Lab)]

T2. The current review of network charging for small embedded generators such as Slough Heat and Power will mean huge increases in costs for them. Is the Department determined to make energy generation the preserve of big businesses only?

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[Paul Blomfield (Sheffield Central) (Lab)]

T6. The Secretary of State is a thoughtful man who I believe is serious about regional growth. Will he assure me that I am right in that understanding by cancelling his predecessor’s decision to centralise his Department’s policy functions in London? Among other things, that would maintain and build on its important presence in Sheffield.

[Greg Clark]

I am certainly attached to the work that is done in Sheffield and the highly valued colleagues we have there. The decision was made some time ago, and many changes have been made. As we sort out the responsibilities of different parts of the Department, I will look carefully at what Sheffield can provide.

[Pauline Latham (Mid Derbyshire) (Con)]

What further steps can be taken to help make non-commercial community energy schemes viable?

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[Angela Smith (Penistone and Stocksbridge) (Lab)]

T8. The expansion of Heathrow would create a demand for 370,000 tonnes of steel and secure 700 steel jobs, so it is not only in the interests of the UK economy more generally that we expand Heathrow but specifically in the interests of the manufacturing sector. Why do we not just get on with it, have the vote here in the Chamber and get on with the building of the third runway?

[Greg Clark]

We do need an upgrade across many different forms of infrastructure, and that will have very important benefits to the steel industry, including in Sheffield.

[Tom Pursglove (Corby) (Con)]

It is hugely encouraging that the Government are developing their comprehensive industrial strategy, which I believe will give a great boost to confidence in our steel industry. Will the Minister update the House on what early discussions he has had with the industry about its role in that?

[Greg Clark]

I have had extensive discussions with the steel industry over the summer, as my hon. Friend will understand. It is very important that we should have a sustainable future for what has been, and is, a very important sector in our economy.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

T9. The huge Hanjin Shipping line has gone into receivership, leaving between £12 billion and £16 billion-worth of goods at sea. The inability to dock is projected to have an impact on UK retail, particularly during Christmas trading. More importantly, UK seafarers—

[Drew Hendry]

Seafarers such as Scots cadets are stuck at sea. What action is the Minister taking to assist retailers, and will he speak to his Foreign and Commonwealth Office counterpart to get help for our seafarers?

[Greg Clark]

I will take that point away. On the immediate impact, I know that the local enterprise partnership is engaged in ensuring that the delays will be overcome.

[Kit Malthouse (North West Hampshire) (Con)]

Many will commend the Secretary of State for putting science, and in particular life sciences, front and centre in his industrial strategy. I wonder whether, as he plans the future of that industry, he could work closely with the Secretary of State for Health, given that the attitude to innovation of the industry’s largest customer, the national health service, will be critical to the industry’s growth in the decades to come?

[Greg Clark]

I certainly will. I was interested to read my hon. Friend’s article in the newspaper earlier this week, which made that point. It is important that the Government take a collective approach, and I have already had discussions with my right hon. Friend the Health Secretary about how we can make the most of the NHS in life science.

[Gloria De Piero (Ashfield) (Lab)]

Will the Government look again at the unjust 50% Government clawback from the mineworkers’ pension scheme surplus?

[Greg Clark]

I will certainly take that point away, and I am happy to meet the hon. Lady if she would like to inform me about that outside the Chamber.

[Mr David Nuttall (Bury North) (Con)]

Does the Department intend to develop a single industrial strategy for the whole country or different industrial strategies for different parts of the country?

[Greg Clark]

My hon. Friend makes a good point. It seems essential to me that we should have a strategy for the whole country, but place is incredibly important, and the challenges of places such as Greater Manchester are different from those of Cornwall. We should reflect more clearly the different strengths and opportunities of different places in how we do business as a Government.

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

Does the Minister accept that the changes to subsidy for the biomass combined heat and power plants have been brought in too quickly, and that a longer grace period should have been granted before implementation? BSW Timber in my constituency, which is doing what the Government want by investing in renewable technology, stands to lose up to £3 million in support. Will the Minister meet me to discuss these changes and talk about what—

--- Later in debate ---

[Greg Clark]

My hon. Friend is right that one of the historic strengths of the United Kingdom is in areas such as marine engineering and power engineering, which are at the heart of the opportunities that exist around the world as many countries look to develop their capacity in renewable energy. That provides a big opportunity, especially for his constituents.

[Melanie Onn (Great Grimsby) (Lab)]

Can the Secretary of State guarantee that all employment protections currently enjoyed by British workers will be maintained after Brexit, and will he back my Bill to do just that?

--- Later in debate ---

[Hannah Bardell (Livingston) (SNP)]

I welcome the Secretary of State to his place, as I do my hon. Friend the Member for Aberdeen South (Callum McCaig), who I know will be a doughty champion for his new brief.

A new report from Professor Alex Kemp of Aberdeen University suggests that the re-engineering of the UK continental shelf fiscal regime may be necessary before we can reach the North sea’s full potential. What further support will the Government offer the oil and gas sector in the autumn statement?

[Greg Clark]

I had a productive set of discussions with representatives of the oil and gas sector in Aberdeen in the summer. The industry, which is centred in Aberdeen but involves other places in the country, is very important. We have made big changes to the fiscal regime, as the hon. Lady knows, which have been beneficial, but we will continue to have discussions about that.

[Jake Berry (Rossendale and Darwen) (Con)]

The Secretary of State described himself earlier as being engaged in an historic task of writing industrial strategy, but surely if he studies history, he will know that industrial strategy is written predominantly by civil servants, and that Ministers tend to fail. What steps will he take to engage businesses in Lancashire to make sure that we have a successful strategy?

[Greg Clark]

I certainly will take such steps, and I am grateful for my hon. Friend’s point. Obviously an industrial strategy for the country should not consist of instructions from Ministers or civil servants to businesses and the rest of the country. We are engaging with businesses across the country and in every sector to ensure that they have the support they need.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

Does the Secretary of State believe that it is conceivable that this country could negotiate full membership of the single market without accepting freedom of movement?

[Greg Clark]

The hon. Gentleman entices me into making early decisions on what our negotiating mandate should be. I think the sensible step is to be careful and to put together our negotiating brief, in consultation with businesses in every part of the country.

[Martin Vickers (Cleethorpes) (Con)]

I welcome the Government’s continuing commitment to the northern powerhouse. Will the Secretary of State meet me and council leaders to discuss how we can maximise the contribution that northern Lincolnshire can make to the project and reap the maximum benefit?

[Greg Clark]

I am always keen to meet my hon. Friend. Despite the fact that I have moved from one Department to another, I hope the invitation to fish and chips in Cleethorpes still stands.

[Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP)]

I understand that the Secretary of State has met many businesses over the past few months. Will he list which of those businesses support leaving the single market?

[Greg Clark]

We are putting together the priorities for our negotiation in consultation with businesses in all parts of the country. The hon. Lady will have the chance to contribute to that through the Scottish Government, and we will publish it when we have finished.

[Robert Jenrick (Newark) (Con)]

We have 50 Airbnb properties in Newark, and Uber has cut the cost of a night out in Nottingham by almost 50%. Will the Secretary of State follow the lead of his predecessor by supporting innovative, disruptive technologies rather than letting us bury our heads in the sand?

[Greg Mulholland (Leeds North West) (LD)]

Following the recommendation of the Select Committee to remove Paul Newby as pubs adjudicator, new evidence has emerged that shows that he failed to properly declare his interests and also misled the Select Committee. So far, he has refused to resign. Will the Secretary of State now restore confidence in that post by sacking him?

[Greg Clark]

My understanding is that the appointment followed a proper process. That is what I understand to have taken place, but I will look at the suggestions that the hon. Gentleman has just raised.

[Several hon. Members rose—]

Informal Competitiveness Council

Greg Clark Excerpts

Thursday 21st July 2016 Written Statements

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

My noble Friend the Minister of State for Business, Energy and Industrual Strategy (Baroness Neville-Rolfe) has today made the following statement:

The Informal Competitiveness Council, chaired by the Slovak presidency, took place in Bratislava on 18-19 July 2016. Baroness Neville-Rolfe represented the UK on day one (internal market and industry) with David Wilson, Deputy Director, International Knowledge and Innovation Directorate, on day two (research)There were major contributions from Gunther Oettinger, Commissioner for the Digital Economy and Society on the digital economy, and by Peter Ziga, the Slovak Economy Minister on the priorities of the Slovak presidency, including the Digital Single Market and principles of better regulation. In a break out session on digital skills, the UK highlighted the importance of working on digital skills in schools, in the workplace and in society, and of bridging the gap on expert skills. The UK confirmed that it would continue to play a full and constructive role in the Council while it remained a member of the EU.

On the second day, member states supported the general principles of the declaration to support young researchers. The UK underlined the value of increased co-operation, but also the need to respect the autonomy of national education systems. Collaboration and regulatory simplification were among the issues that were strongly supported in creating an ecosystem to support innovative SMEs. The UK joined a number of member states in emphasising the importance of further simplification of support programmes and following up on existing commitment to create a more innovation friendly environment.

[HCWS103]