Sustainable Aviation Fuel Bill (Fourth sitting)

Debate between Greg Smith and Mike Kane

Committee stage
Thursday 17th July 2025 Public Bill Committees

[Greg Smith (Mid Buckinghamshire) (Con)]

New clause 8 has considerable merit. It is always preferable where new industrial facilities are to be built—in this case for the production of sustainable aviation fuel—for those identified sites to have had former brownfield status and former industrial use. I have no argument with that element of the new clause.

The one note of caution I have on the new clause is that many of the existing sites—certainly oil refinery sites—are not necessarily located in the right places currently for certain SAF technologies. That includes the e-fuels and power-to-liquid solutions, which require, as part of the process, electrolysis and the creation of green hydrogen. Of course, if the hydrogen element that goes into making the SAF is not green hydrogen, the whole problem becomes rather academic—we could still make the fuel, but the reality is that it would not be as green as we want it to be. Those SAF production facilities, by definition, would need to be located in places with potential large-scale offshore wind, electricity production or, possibly, nuclear generation.

If we look across the world at such fuel plants that have been created, Porsche, for example, chose the hills of Chile to produce its particular fuel, because it can leverage off the wind power that it can get up there. In our country, Orkney seems to have been a popular site for harnessing the offshore wind technology available up there. While I fully support the principle that underpins the new clause—for many SAF production sites to be on former industrial or oil refinery sites—I simply wish to add the note of caution that they might not be suitable for every application and technology out there.

[Mike Kane]

On new clause 8, the hon. Member for Wimbledon is right to talk about deindustrialisation. Growing up in the 1970s, I saw the impacts of that, particularly on the east side of Manchester, with the chemical and mining industries being wiped out. In this day and age, we are still getting over that in my great city. I reassure him that we are supporting the SAF industry, in part, to grasp this opportunity for deindustrialised areas. Emerging SAF projects are often located on former industrial sites, and I remind the Committee that, if we do this right, our low-carbon fuels industry can support up to 15,000 jobs and £5 billion to the economy by 2050.

I also reassure the hon. Member that work is ongoing across Government on the future of our refineries. We are acting urgently in response to the deeply concerning news of insolvency at Prax Lindsey oil refinery, and have put £200 million into the National Wealth Fund to back investment at Grangemouth. I want that work to continue at pace, and am conscious that specific sites will need to be considered on a case-by-case basis. Commissioning an additional separate report would not be beneficial, and would risk delaying potential investment decisions. Given that, I ask the hon. Member to withdraw the motion.

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[Mike Kane]

Thank you, Mr Western, for chairing the Committee. I also thank the Clerks, Hansard Reporters and Doorkeepers for overseeing proceedings. The Committee also benefited from the expertise of our witnesses and those who provided written evidence. As this is a hugely technical Bill and the world is watching us, I pay a massive tribute to the civil servants in my Department who worked on it.

I thank all hon. Members who made this issue a manifesto commitment at the general election. I thank the Opposition for supporting the Bill and for their valuable contributions and insights. I thank the shadow Minister, the hon. Member for Mid Buckinghamshire, the Liberal Democrat spokesman, the hon. Member for Wimbledon, and all other Committee members. I thank them for their expertise and insight, and for the broadly positive, collaborative nature that they brought to the Committee. We all want the SAF industry in this country to grow and succeed so that we secure our world-class aviation sector’s future. I look forward to further engagement with hon. Members on the Bill.

[Greg Smith]

I associate myself with the Minister’s thanks to everyone who has worked so hard on the Bill, particularly the civil servants; I welcomed the ability to discuss the Bill with them in a private briefing before Second Reading. I also thank the Doorkeepers, Hansard and the Clerks for ensuring that the Committee has run smoothly.

It is quite a pleasant experience to engage with a Bill in opposition when there is fundamental agreement on the direction of travel. The other Bill Committee of this Parliament on which I was shadow Minister was for the Employment Rights Bill, where we did not enjoy quite the same level of consensus, but to meet the challenges of decarbonising our aviation industry it is important that this Bill progresses rapidly.

However, I urge the Minister, who has been kind and engaged throughout the process, to continue to reflect on the points that I have raised in Committee and that the shadow Secretary of State, my hon. Friend the Member for Orpington (Gareth Bacon), raised on Second Reading, as well as the many worthy points that the Liberal Democrats have raised. If we can keep going in the spirit of cross-party working and reflect on some of the points about UK intellectual property—making this a UK success story, making the UK a world leader and ensuring that the technologies that emerge genuinely do what they say they will—then I think all of Parliament, not just the Government, can be proud to push the Bill through.

Question put and agreed to.

Bill, as amended, accordingly to be reported.

Sustainable Aviation Fuel Bill (Third sitting)

Debate between Greg Smith and Mike Kane

Committee stage
Thursday 17th July 2025 Public Bill Committees

[Greg Smith]

It is a pleasure to serve under your chairmanship, Mr Western. As I have throughout the passage of the Bill, I draw hon. Members’ attention to my entry in the Register of Members’ Financial Interests—I am taking a safety-first approach here—and the donation from Nemesis of synthetic road fuel for a constituency surgery tour last year. That is not relevant to sustainable aviation fuel, but I want to be entirely transparent about it, as I have been throughout the passage of the Bill.

Before I speak to amendment 3, a broad comment about all the amendments I will speak to today is that, fundamentally the Opposition are not a million miles from the Government on the Bill. However, as I am sure you expect us to do, Mr Western, it is our job as His Majesty’s loyal Opposition to kick the tyres and ensure that the Bill is as strong and workable as it can be. We share the ambition to decarbonise aviation and ensure that everybody still can fly for pleasure or business, and that businesses can move goods around the world using air freight.

It is in that spirit that I tabled amendment 3, which aims to ensure that the producers that come forward for the various contracts consider the full breadth of the sustainable aviation fuel technologies available. On Tuesday, we heard oral evidence from manufacturers of wholly synthetic, waste-derived and feedstock-derived sustainable aviation fuels. It is important to look at the panoply of fuels in relation to the long-term environmental impact and the practicalities of producing them today.

As I said on Second Reading, my big fear, which led to my tabling the amendment, is that industries might be stood up only to be turned off again in 10 or 20 years, as the technology becomes redundant. For example, in the oral evidence session on Tuesday we almost had a debate about the possible pitfall of there not being a waste supply to create waste-derived sustainable aviation fuel. Many local authorities up and down the land, my own in Buckinghamshire included, are tied up in 10, 20 or even 30-year financial obligations to, for example, the financing of energy for waste incinerators, which in some parts of the country are connected to heat networks. It may therefore not be possible for councils to say simply, “No, we want to move our waste to a equally productive but different form.” Those contracts exist.

The point of the amendment is to ensure that we look through that very clear lens to see which of the technologies available for producing sustainable aviation fuel will have the longevity of supply and relative environmental impact in the long term. From the evidence we heard the other day, it is clear that some technologies are at a different point of development from others, but none is actually that far away.

For example, the evidence we heard from Zero Petroleum was that it is ready to scale a wholly synthetic production facility right now. Of course, that does not happen overnight—it takes some considerable time to build any facility—but the scalability is able to happen right now. The Government should reflect on that point and should not look just at the technologies that are available right here, right now. I would argue that, too often in this country, we look for alignment with the technology that is available today, when that which is only hours, days, weeks or months away may well be better and worth waiting for.

That is the point of the amendment: ensuring that we get this right for the long term, so that we have a supply of sustainable and, I hope, synthetic—entirely man-made from air and water—fuels available for this country, so that we have the liquid hydrocarbons there, available for purchase, using the price mechanism which sits at the heart of the Bill to get production going, so that our aviation sector can continue to flourish and be available for all that wish to use it.

[The Parliamentary Under-Secretary of State for Transport (Mike Kane)]

It is a pleasure to serve under your chairmanship, Mr Western. We often discuss our bicycles and their technology, but today we have to talk about the revenue certainty mechanism, which I am glad we are doing.

The RCM is part of the Government’s agenda to decarbonise aviation in the United Kingdom. I will address the amendment moved by the hon. Member for Mid Buckinghamshire, but first I put on the record my thanks to him and other Opposition parties for their general support for what we are trying to do in the Bill.

This Government back synthetic power-to-liquid SAF, which is why we have introduced a separate power-to-liquid sub-obligation, the SAF mandate. We have a separate power-to-liquid pot in the advanced fuel fund, which we are funding up to £63 million. Any RCM contracts awarded will be on the basis of the design phase of the project, including technological pathway and feedstock designation. I hope that answers the hon. Member’s worries about redundancy, because the process will evolve.

Making changes to feedstock requirements or fuel type after contracts are awarded would be extremely challenging for producers. Instead, during our contract allocation process, it is for the Government to decide on the right mix of SAF that will be supported under the revenue certainty mechanism. Given that, I ask the hon. Member to withdraw the amendment.

The clause allows the Secretary of State to direct the counterparty to enter into a revenue certainty contract with a SAF producer. The Secretary of State will decide who gets revenue certainty contracts through an allocation process. Making the leap from lab to commercial scale is difficult for SAF producers—we heard that in the evidence sessions on Tuesday. Commercial plants typically cost £600 million to £2 billion, so they need to attract a lot of investment, yet first-of-a-kind plants often struggle to get investment because there is no clear, predictable market price for SAF. The revenue certainty mechanism will address that.

Under the revenue certainty mechanism a SAF producer will enter into a private law contract with a Government-backed counterparty that sets a strike price for SAF. If the producer sells SAF for less than the strike price, the counterparty will pay the difference. If the producer sells it for more than the strike price, it will pay the counterparty. This follows the example of similar schemes in the renewables sector, which showed that a private law contract with a Government-backed counterparty is a rock-solid commitment that will drive investment into projects.

As we heard in our evidence sessions on Tuesday, British SAF producers are ready. They have the tech and the innovation; they just need the final piece of support from the Government to take off. That is why SAF producers, airlines, environmental groups and investors back these measures.

A Government-backed counterparty will enter into the contracts rather than the Secretary of State, because investors value the day-to-day independence of a Government-owned private company and its insulation from political change. The counterparty will also have expertise in contract administration. This follows the model of contracts for difference schemes in other renewables sectors, where the Low Carbon Contracts Company, a Government-owned body, enters into the contracts, rather than the Secretary of State for Energy Security and Net Zero.

When we consulted on how the revenue certainty mechanism should be administered, stakeholders strongly supported having a counterparty. The clause ensures that the Secretary of State can exercise control over how and on what terms the counterparty enters into the revenue certainty contracts. This is consistent with the approach for similar schemes. The Government will set eligibility and assessment criteria for the competition to allocate contracts, which will focus on ensuring value for money, maximising the benefits of UK SAF production, and supporting viable projects. Any restrictions on our ability to decide which projects to allocate contracts to would affect those objectives and jeopardise the whole scheme.

The allocation process and the terms of the contract will need to be consistent with the requirements of the Subsidy Control Act 2022, which makes sure there is oversight of the mechanism by the Competition and Markets Authority through the mandatory referral process. The oversight will ensure that the objectives of the revenue certainty mechanism address the subsidy control principles set out in that Act. This includes ensuring that the scheme addresses an identified market failure, that any funding provided is proportionate to achieve that objective, and that any distortions of competition, investment or trade are minimised effectively.

Clause 2 provides that producers must be notified of a direction made under clause 1 that affects them. This provides transparency and ensures that producers are aware of any directions towards them. It also gives the Secretary of State powers to revoke a direction and its effect, which protects the Government from entering into a contract where a producer has not met the criteria defined during the allocation process due to unexpected circumstances. We need to ensure that the taxpayer and the sector are protected, and this clause ensures that we can remove ourselves from the contract negotiation process if any issues arise.

Clause 3 enables the Secretary of State to make regulations requiring the counterparty to maintain a register and publish the revenue certainty contracts, subject to any necessary redactions. This will ensure transparency by keeping a register of successful applicants and information on specific agreements, and make it clear which SAF producers have received contracts and on what terms. We will also continue to publish information on the volume of SAF supplied under the SAF mandate. These publication requirements will balance transparency and the commercial and confidential nature of contracts and negotiations. We believe that any stronger requirements to publish information may make producers reluctant to enter into negotiations or affect our ability to ensure value for money.

[Greg Smith]

I accept many of the arguments that the Minister has put forward. I note he acknowledged that, off the back of the evidence sessions on Tuesday, all the current technologies are ready. That is a really important point for the Committee and the whole House to reflect upon as the Bill progresses. There has been something of a narrative from the usual vested interests in the country suggesting that one technology or another is not in the right state to be able to move forward, or to produce sustainable aviation fuel at the scale we need as a country. It is very welcome that the Minister acknowledged in his remarks that the technologies are already to scale, whether the fuel is HEFA-derived, waste-derived or entirely synthetic following the Fischer-Tropsch process at large.

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[Mike Kane]

Clause 11 creates new civil penalties that are necessary to secure the payment of the levy and compliance with regulations. Any penalty will be limited to a maximum of the lesser of £100,000 or 10% of the turnover being penalised. This penalty can be imposed for failing to pay the levy and failing to pass on the benefits of surplus payments to customers in accordance with the regulations under clause 10(1)(b). This penalty is consistent with similar penalties under the SAF mandate. The clause also allows these penalties to be adjusted in line with inflation.

The schedule sets out the procedure for notices, appeals and recovery of penalties. It ensures that anyone who has to pay the penalty will be told why, how much they have to pay, their right to appeal and the deadline for making any payment.

I will also speak to Government amendment 2, which inserts “or Northern Ireland” after “Wales” in the schedule. The amendment will ensure that an unpaid penalty is recoverable in Northern Ireland as if it were payable under an order of the county court, as is the case in England and Wales. The amendment corrects a drafting error and does not reflect a change in policy intention.

[Greg Smith]

I do not have a great deal to say on the provisions, other than that it is always regrettable when Northern Ireland is forgotten and has to be inserted via an amendment.

On the clause, I have no problem with financial penalties for failure to comply with the law, so I am not attacking the clause per se, but what will the appeal mechanism be? When it comes to law that involves financial penalties, a company will often have a legitimate case—force majeure, or whatever it might be—as to why it has been unable to comply with the letter of the law, and it is always important, as a matter of natural justice, for an appeal mechanism to be in place. Does the Minister intend to enable appeals where such financial penalties are given?

[Mike Kane]

I am grateful to the hon. Member. Because this will be a matter between the counterparty and the companies invited to bid, it will be subject to normal contract law, but I am happy to write to him on the matter of appeals more specifically.

Question put and agreed to.

Clause 11 accordingly ordered to stand part of the Bill.

Schedule

Financial penalties for failure to comply with levy regulations

Amendment made: 2, in the schedule, page 10, line 28, after “Wales” insert “or Northern Ireland”.—(Mike Kane.)

This amendment ensures that an unpaid penalty is recoverable in Northern Ireland as if it were payable under an order of the county court, as is the case in England and Wales.

Schedule, as amended, agreed to.

Clause 12

Power to direct designated counterparty

[Greg Smith]

I beg to move amendment 4, in clause 12, page 7, line 12, at end insert—

“(3) A direction given under subsection (1) must include a requirement for the designated counterparty to report on—

(a) the impact of any revenue certainty contract on the fluctuation of the average price to consumers of an airfare over the proceeding 12 month period;

(b) a projection of the expected impact of any revenue certainty contract on the fluctuation of the average price to consumers of an airfare over the following five year period.

(4) A report under paragraph (a) must be made within one year of the date of Royal Assent to this Act and annually thereafter.

(5) The Secretary of State must lay a report made under paragraph (a) before Parliament.”

Amendment 4 focuses on UK IP, which I alluded to earlier. Given that we have been told throughout the passage of the Bill, and the Opposition agree, that we need to underpin domestic sovereign fuel security, there should be a provision in the Bill that gives preference to UK IP and UK producers—not just those that might happen to make the fuel here, but those that are using UK-derived innovation and technology to do so. Of course, we exist in a global marketplace and are often reliant on imports, but it would be regrettable if the Bill enabled the standing-up of industries that are based entirely on foreign-owned technology. That is what the amendment seeks to correct.

[Mike Kane]

I concur with the hon. Member about domestic fuel production, particularly in the uncertain geopolitical world that we face today, but amendment 4—

[Greg Smith]

I spoke to amendment 5—I apologise.

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[Mike Kane]

Well done to the hon. Member for Mid Buckinghamshire; he pulled it out of the fire there with the amendments. He is right that we are putting SAF on the statute book. We should have put it on the statute book years ago, which is why it was in our manifesto and we are doing the right thing now. I will address the questions about £1.50 in a moment.

Amendment 4 tabled by the hon. Member would put a requirement on the counterparty to report on the effect of the introduction of the revenue certainty mechanism on air travel prices. Once operating, the revenue certainty mechanism is expected to make minimal changes to fares with an average ticket price, as we have said, decreasing or increasing by up to £1.50 on average per year. I remind him that that is less than a bus fare on Andy Burnham’s Bee Network in Greater Manchester where I live. I would offer to pay it, but it is quite cumulative over time and I do not have that type of resource—I am happy to fund the hon. Member for one year at £1.50 if he so wishes. That figure comes from a DFT analysis.

The costs of the scheme and the impact on ticket prices will be kept under continual review. The Government will also set the approach to the allocation of contracts, the number of contracts awarded and the scale of support they provide. Those controls will help to minimise any potential impacts on airfares. The costs of the scheme will also be reported in the DFT annual report and accounts in the usual way. I therefore ask the hon. Member to withdraw his amendment.

The hon. Member for Wimbledon asked whether the figure refers to the mandate or the revenue certainty mechanism. I assure him that it is just the revenue certainty mechanism.

[Greg Smith]

I am grateful to you for rescuing me, Mr Western, by grouping both amendments in the same debate. I made a mistake, so I put my hands up to that.

I am grateful for the Minister’s response. I will not press the matter to a vote but, as with the earlier amendment, when projections are made I think it is incumbent on the Government to find a way of giving comfort to all the travelling public and all those businesses that use air freight that the provisions of the Bill—I fully accept the comments of the hon. Member for Wimbledon on the wider effects of the mandate—will not produce a much higher cost to them when they go on their holidays or business trips or move goods around the world.

Ahead of Report, will the Minister and his team in the Department look at ways to kick the tyres on those presumptions—in particular given the evidence we heard on Tuesday—and check that they are robust as possible and have the confidence of industry? I would be grateful for that, and we may well return to it on Report. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

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[Greg Smith]

I absolutely understand and appreciate where the hon. Gentleman is coming from with this new clause. This topic came up in the oral evidence sessions and on Second Reading.

It is of great concern that the slightly lower tariffs deal done with the United States of America has clearly and materially threatened UK production of bioethanol, which of course has many uses. Many of us on the petrol station forecourt will have seen the curious E5 and E10 labels on the petrol pumps, which is about the ethanol blended with the regular fossil fuel. Our consumption of it as a country is particularly high.

As we are debating the potential future of bioethanol in sustainable aviation fuel production, it is incumbent upon the Government to reflect, within the scope of the Bill, on how much domestic supply there can be. So much of the Bill is underpinned by sovereign capability and fuel security—a point on which the Opposition and I think the Liberal Democrats are equally aligned on; it is so important—and so surely this new clause must also be important to the Government. I ask the Minister to reflect on that when he responds.

[Mike Kane]

I am extraordinarily proud that we have a Prime Minister and a Government who are rebuilding the UK’s reputation across the world once again, building trade deals with our closest partners across the planet, whether that be India, America or the recent agreement with the European Union. That is where Britain should be—leading and involved, not on the fringes as we have been for many years.

We are debating sustainable aviation fuel, but this is also about decarbonising the planes that will fly in our skies for generations to come. That US trade deal is zero tariff on aviation technology, which is a huge deal for this country, making it a world leader again in the future.

However, I am worried for the workers and families who have been affected by the trade deal. Ministers and officials, including the Business and Transport Secretaries, have met the companies consistently during this challenging time—those companies were struggling regardless of the time—to understand their concerns, discuss what action could be taken and to support them, because that is what good Governments do. The Department for Business and Trade is in discussions on requests for support from the UK bioethanol sector. As a responsible Government, there is a series of strict criteria and well-established due diligence processes that we must follow to consider such requests.

While I would like to see a thriving UK bioethanol sector, we would not expect a significant impact on the SAF mandate if there were to be a reduction in that sector’s production. That is because the UK bioethanol plants use crops that are not eligible for the SAF mandate. The SAF mandate, which is the framework for the supply of SAF in the UK, sets targets based on the availability of waste feedstocks rather than crop feedstocks. The SAF mandate is a global scheme and can use fuels from all around the world, providing an opportunity to draw upon a diverse pool of feedstocks.

However, we also want to encourage a UK industry. In January, the Chancellor announced £63 million of funding this year to help grow UK supply of SAF through the advanced fuels fund, which has been further extended in the recent Budget through to 2029-30. The SAF revenue certainty mechanism—the subject of the Bill—will also boost investment in UK SAF production.

Finally, under the SAF mandate, a formal review of the whole scheme has been built into the legislation, with the first review taking place in 2030. That will provide an opportunity to make an assessment on the availability of SAF supply. The above steps demonstrate how many of the recommendations set out in the hon. Member for Wimbledon’s new clause are already being undertaken by the Government. Given that, I ask him to withdraw it.

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[Luke Taylor]

I rise briefly to press this question to the Minister: if the Government oppose the new clauses, how are they are going to incorporate their intent? I think they probably agree with the intent but are probably just resistant to their being outlined as they are. I ask the Minister to go into as much detail as he can on whether that will happen through the jet zero taskforce or something else.

[Mike Kane]

I always enjoy listening to the rasping oration of the hon. Member for Wimbledon.

[Greg Smith]

Rasping?

--- Later in debate ---

[Mike Kane]

I do not have the answer in front of me, but I commit to providing the hon. Gentleman with an answer in due course. I thought the point he was making was about whether we are being open and transparent across all sectors in the UK in showing how we are decarbonising the aviation sector. [Interruption.] I do now have the answer. Who knew? The miracle of mobile telephony—it will save writing my signature to him with the electronic pen. The SAF mandate and statistics include details of feedstocks and the origin of the SAF. I hope that answers his question, but if he wants more information—we are all keen on this—I would ask him to please keep in touch.

New clause 5, entitled “Increasing greenhouse gas saving potential of sustainable aviation fuel”, was tabled by the hon. Member for Wimbledon. The SAF mandate is the UK’s key policy to decarbonise jet fuel. It does that by securing demand for SAF, by obligating the supply of an increasing amount of SAF in the overall UK aviation fuel mix. The SAF mandate rewards SAF in proportion to the greenhouse gas savings its achieves. That will encourage SAF developers to improve continuously on their greenhouse gas savings. To ensure that the SAF mandate reflects the latest technological and commercial developments, there will be continuous monitoring of trends and the impacts of the mandate. Formal reviews will be conducted and published at least every five years, with a formal review in 2030. The formal reviews will already include certain elements of the new clause, namely the minimum greenhouse gas savings threshold and the minimum targets for supply of SAF. Following the review, there will be an opportunity to update the legislation as needed.

[Greg Smith]

The central question is whether that review, when it comes, looks at the greenhouse gas savings while the aircraft is in use, or gives a whole-system analysis, from the production and use of the fuel to the benefits of using the by-products, post combustion, to make more fuel. That is an important clarification that we need.

[Mike Kane]

My kingdom for a chemistry degree! I will let the hon. Gentleman know the answer to his question in due course.

To go back to the point, new clause 5 would duplicate the process already embedded in the SAF mandate legislation. I therefore ask the hon. Member for Wimbledon not to press the new clause.

Oral Answers to Questions

Debate between Greg Smith and Mike Kane

Thursday 27th March 2025 Commons Chamber

[Mike Kane]

The Climate Change Committee advises; we decide. We are not going to take any lectures on tough decisions. I remember when the former Member for Uxbridge was Foreign Secretary in 2018, he concocted a trip to Kabul to avoid a debate on expansion plans for Heathrow. We are getting on with growing aviation in this country.

[Greg Smith]

If it is tough decisions the Minister wants, I invite him to look at what happened in the Budget of broken promises. Air passenger duty went up significantly. For example, a couple flying to New York will pay £204 in tax. That is a 16% increase. Does the Minister not see that he needs to stand up to the Treasury if he is going to stand up for the aviation sector? Otherwise he is doing what socialists always do: tax growth out of existence.

[Mike Kane]

I enjoy the hon. Member trying to polarise the Chamber. He is sort of all right at it, but we are getting on with decisions around Luton, Stansted, Heathrow and growing the aviation sector. Yes, tax is an important element, but in the past two months we have seen the biggest demand ever—even before the pandemic—in people wanting to fly. That is a testament to the work we are doing in Government to get on with the decisions that should have been taken years ago.

HS2 Mitigation Projects: Inflation

Debate between Greg Smith and Mike Kane

Friday 14th March 2025 Commons Chamber

[Mike Kane]

Well, it was the former Prime Minister who came to Manchester during the party conference to scrap HS2 from going from Manchester. I have never known quite such a political insult. It was supposed to balance up our country, yet we will have reduced capacity and there is an impact on Northern Powerhouse Rail. The handling of the project over a number of years has had effects both on the constituencies it is going through, as the hon. Member has so passionately extolled, and on those that are not getting it.

Let me get back to the point that the hon. Member for Mid Buckinghamshire is here to talk about. Following discussions with St Mary’s in 2016, during the passage of the High Speed Rail (London – West Midlands) Act 2017, the church was given an assurance and commitment that the project would support it in improving its noise insulation. The assurance provided very clearly for a contribution up to a maximum of £250,000, with no provision for inflation. There are many other HS2 assurances on the public register, including commitments to fund particular works or activities. Some of those explicitly provide for index-linking; others do not. The one given to St Mary’s does not. It is worth noting that the House of Lords Committee set up to hear from petitioners against the Bill considered the case of St Mary’s, and took the unusual step in 2016 of reporting that the £250,000 offer was generous. Furthermore, I am pleased to report that, since the assurances were given, HS2 has made other improvements to its plans for noise mitigation in the locality of the church. That will reduce the amount of noise reaching the church in the first place.

Taking all that into account, it is not considered appropriate to increase the amount of public funding offered to the church or to increase any other financial mitigations that were fixed, not indexed, at the time they were agreed. There is no evidence that the sums are no longer sufficient. We have inherited a difficult situation on HS2, as the hon. Member said, and our priority now is to get a grip of the cost to the Government.

[Greg Smith]

I am grateful to the Minister for his comments, but does he accept, as a point of principle, that that was not an arbitrary amount of money offered to the church as a top-up for church funds, but was very specifically for noise mitigation purposes? If in 2025 the money promised in 2016 simply cannot deliver that, it is not fair on the church or the many other projects in a similar position. I know that it is not a problem of his making, but it is a problem that the Department for Transport, as the sponsoring body, now finds itself with.

[Mike Kane]

The hon. Member is right. HS2 has clearly already put in some noise mitigation, but I hope he will hear me out for a second.

I understand that agreement has not yet been reached on the mitigation works to be undertaken at the church. As a result, according to the terms of the assurance, the funds cannot yet be released. I encourage the hon. Member, and particularly the parties of HS2 and the church, to focus their efforts on agreeing the works that can be carried out and a timeline for them to begin, so that the available funding can be released and stretch as far as humanly possible. I encourage the parties to get together and begin that negotiation.

I am a social member of Wythenshawe cricket club—although my playing days are long behind me—so I know the value that cricket clubs, and other sports and social clubs, provide not just in sporting terms but in the social glue of cohesion and solidarity. The hon. Member spoke eloquently about Wendover in his constituency. The deal that was asked for had an uplift to cover inflation. I understand that the request is currently with HS2, which is looking into the circumstances of the club and will respond in due course. I hope that he will get an answer very shortly; if he does not, he should please contact me. I will then let the Rail Minister know and we will follow it up. HS2 will have heard his impassioned plea that this historic and successful club does not miss out.

The hon. Member for Beaconsfield (Joy Morrissey) raised road conditions. I am aware that HS2 Ltd has been working closely with Buckinghamshire council over the past few years to improve the way that such road repairs are managed. It has already allocated considerable resources to dealing with that problem. Road repairs are measured against the baseline road condition levels agreed at the start of the project. Either payments are made to councils at current prices or the repairs are undertaken by HS2 Ltd contractors, so they are not affected by inflation. I am pleased that the hon. Member for Mid Buckinghamshire has been far more successful with East West Rail on the road repairs in his constituency.

I again congratulate the hon. Member on securing this debate. Let me reiterate that transport is an essential part of the Government’s mission to rebuild Britain. We will continue to work with hon. Members and local leaders on ensuring that we get the delivery of infrastructure projects right. As I said, I welcome this debate, as it is vital that we continue to discuss our transport projects openly and transparently.

Question put and agreed to.

Oral Answers to Questions

Debate between Greg Smith and Mike Kane

Thursday 9th January 2025 Commons Chamber

[Greg Smith (Mid Buckinghamshire) (Con)]

May I, too, wish the Minister a very happy birthday?

Estimates suggest that the SAF mandate provisions and the revenue certainty mechanism will still leave a shortfall, with a family of four facing over £300 extra to fly on holiday by 2040. That is a clear concern for consumers, as well as the airline industry. Net zero should not come at an additional cost to consumers or undermine freedoms—in this case, the freedom to fly. The test must surely be how to defossilise, decarbonise and allow people to do the same at the same cost. What steps is the Minister taking in conjunction with the Treasury to close the financial gap between incentives in the mandate and the actual increased cost of switching to SAF for the end consumer?

[Mike Kane]

I think the good will ended with “happy birthday.”

I remind the shadow Minister that a little over 12 months ago, in one of his better videos, the then Prime Minister came out into Downing Street, looked at the sky and lauded the policy he wanted when we saw Virgin Atlantic’s 100% SAF trip across the Atlantic. This was the previous Government’s policy but, because of the sclerotic nature of that Government, we are only now getting on with implementing both the SAF mandate and the revenue support mechanism. As the shadow Minister knows, a regular review point is baked into the legislation so that we can revisit targets, if required.

[Greg Smith]

Of course, there is always another way. Much of the debate so far on SAF has been about fuels made from feedstocks and waste products. Unlike fuels that require feedstock, whose input costs will only ever go up, the industrial process that creates power-to-liquid synthetic aviation fuel will actually see its production costs reduce, with some predicting cost parity between the production of these synthetic fuels and the extraction and production of fossil fuels within a decade. Does the Minister agree that synthetics offer a much better long-term solution, and will he reprioritise the Government’s approach to SAF away from transitional solutions and towards synthetics?

[Mike Kane]

The hon. Gentleman runs his car on synthetic fuel, so I know his passion. There are many ways to get to SAF. The SAF mandate is supported by industry, and there is a real opportunity to establish a plethora of production. We can create thousands of new well-paid jobs while protecting the pound in the holidaymaker’s pocket.

Transport

Debate between Greg Smith and Mike Kane

Monday 9th September 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Transport (Mike Kane)]

My goodness, it is a pleasure to see you in the Chair, Madam Deputy Speaker. Congratulations on your election.

It has been a collegiate debate and I am grateful to all the hon. Members who have attended. I am grateful to the Opposition for their support. I say to the hon. Member for Mid Buckinghamshire (Greg Smith) that I am looking forward to a picture on his social media of his SAF-powered Land Rover as he goes canvassing in his constituency—that is a must-see for us all.

[Greg Smith]

It is on its way.

[Mike Kane]

That is good news. The issue has had good cross-party support: when I was in opposition, I supported the Government on it.

In his maiden speech, the hon. Member for Witney (Charlie Maynard), who is no longer in his place, thanked his predecessor, and I put on record my own tribute to the former Member for Witney; he undertook my current role with diligence, care and good humour and I wish him the best for the future.

Really, this legislation was set out by the Labour Government in 2003 in the aviation White Paper, “The Future of Air Transport”, in which we talked about the future of decarbonising aviation for the first time and about bringing in new sustainable fuels.

The shadow Minister had some specific questions. He asked about ticket prices. The Government recognise that SAF will be more expensive than traditional jet fuel, and it is right that the costs, as we have agreed in the past, are borne by the polluters—they will not be borne by the Government. I think the figures are that, by 2030, we expect tickets to be £4 more, which will be a 2% increase, and by 2040, we expect them to be £10 more, which will be a 5.5% increase. Before Mayor Burnham re-regulated the buses in Greater Manchester, a person could fly from Manchester airport to Dublin for £12.99 but they could not cross my conurbation on a bus and change transport providers for that amount of money. The shadow Minister was right to raise that point, but the increase is negligible.

The shadow Minister asked about the future fuel funds. We have seen some great things going on in private industry. In the north-west of England, we see Fulcrum BioEnergy producing sustainable aviation fuel at Ellesmere Port; we see Velocys in the north-east doing it at Immingham—I will come to my hon. Friend the Member for Easington (Grahame Morris) in a minute—and Alpha Air doing it in Teesside. That is really good for the regeneration of post-industrial areas in parts of the north of England.

The shadow Minister talked about power to liquid. Yes, that is the future. In my speech, I set out some ambitious targets that we will have to meet to reduce the HEFA and improve power to liquid. He asked about our ambition. The UK does not want to be at a competitive disadvantage, which is why we have carefully balanced the HEFA cap in a way that recognises that HEFA is, currently, the only commercially available type of SAF, but that does not mean that we cannot go further and faster. I mentioned in my speech that there will be reviews every five years, starting in 2030, so I hope that that satisfies the Opposition. I am grateful for their support in this area.

Let me turn now to my hon. Friend the Member for Easington. I always like to thank him for his contribution to transport debates; he is always in these debates. He is a stalwart when it comes to transport issues and he is really considered. He is right that there are too many anagrams in the field of sustainable aviation fuel. When the Conservatives were in power, they always talked about the bonfire of regulations. Perhaps we should start the bonfire of anagrams. My hon. Friend is not wrong, but we will have to see. He did say that these are good, sustainable industrial jobs in parts of the country where we need them. That is what SAF brings us and that is what the Government are trying to achieve.

I also thank the Liberal Democrats for their support on this issue. We are working with suppliers. I have had roundtable discussions with suppliers, particularly in opposition, and there is more to come in government. I have mentioned some of the companies that we were working with. This is an ambition, but I think that we can go further and faster. The figures that I gave are not set in stone. We should be promoting new technologies, because there are new technologies beyond this area. There is hydrogen battery power. When it comes to UK emissions, would it not be a great day when a Minister can say that there will be no carbon burned in any planes flying internally within the UK? That would be a great place to be.

As a north of England Member, however, I have to disagree with the idea that we should stop people flying because there is a train. That might be fine in an area where there are great, reliable train services, but I invite the hon. Member for Bath (Wera Hobhouse) to come on my Avanti train occasionally to see how unreliable and how poor that service is. We have to keep it in mind that, one day in the future, we will improve the rail services through our great British rail Bill, but at the moment we have absolutely no plans as a Government to stop people flying.

High Speed 2 Compensation

Debate between Greg Smith and Mike Kane

Thursday 18th January 2024 Commons Chamber

[Mike Kane]

Like Napoleon out of Moscow, it is routed through the poisoned-earth strategy with the lifting of the safeguarding today. We have to be responsible. We will have to see what the books tell us if we are to enter Government in the weeks or months to come.

We have seen 14 years of promises to the north and the midlands broken. In the Prime Minister’s desperate, failing attempt to rebrand himself as the change candidate at the next election, he decided to rush through an alternative plan at the party conference—a plan that mentions places such as Crewe, which, as the hon. Member for Crewe and Nantwich rightly said, would have greatly benefited, but a plan that the Prime Minister admitted was only “illustrative”. Illustrative? The Network North plan announced fantastic news for my Wythenshawe and Sale East constituency—a new Metrolink line to Manchester airport. It opened in 2016. That illustrates the chaos and the confusion of that announcement.

The now Foreign Secretary was not alone on the Conservative side in criticising the decision. Two former Chancellors warned the Prime Minister that his actions were “huge economic self-harm”, while the Tory Mayor of the West Midlands described it as “cancelling the future”—a great line, if I may say so to the hon. Member for Lichfield. In what is a consistent theme for this Government, this whole mess has been created by not consulting the communities affected, not speaking to our Metro Mayors and not listening to the businesses across the country that were depending on the project.

After 14 years, communities have had enough of the broken promises from this broken Government. Labour will not repeat those mistakes—mismanaging major projects, turning people’s lives upside down, taking their trust for granted, impacting their businesses and livelihoods and failing to deliver.

[Greg Smith]

I am listening carefully to the shadow Minister, who is telling us that a mythical future Labour Government would not disrupt people’s lives. Does he understand that building HS2 does devastate people’s lives? Big infrastructure devastates people’s lives and there is no way to do it without doing that.

[Mike Kane]

That is exactly why Labour would do it with the Mayors, with the communities and in consultation with those it would affect and impact. HS2 was going to go under my back garden—that was my interest.