UK Infrastructure Bank Bill [Lords]

James Murray Excerpts

2nd reading
Tuesday 1st November 2022 Commons Chamber

[James Murray (Ealing North) (Lab/Co-op)]

I will set out the views of the Opposition. We will not oppose the Bill today, as it seeks to put the UK Infrastructure Bank, which has been operating on an interim basis since June 2021, as we heard, on a statutory footing. We support the establishment and strengthening of the bank, and we want the new institution to play its part in tackling climate change and supporting regional and local economic growth.

The need for economic growth is central to the challenges our country is facing today, and it comes after 12 years of low growth under the Conservatives. During the last Labour Government, despite the global financial crisis, the economy grew by 2.1% a year. Since 2010, however, the Tories have grown the economy by just 1.5% a year. The outlook under the Tories now is even worse, with growth forecast to be the worst in the G7 over the next two years. As the previous Chancellor recently admitted, under the Conservatives we have been stuck in a “vicious cycle of stagnation”.

That stagnation in our economy has seen real wages fall and the tax burden rise for working people in this country. Even before the disastrous mini-Budget, working people were paying the price for the Conservatives’ record of failure on the economy. What the then Chancellor announced on 23 September poured petrol on the fire, as Ministers unleashed a discredited and reckless economic approach on the British public. Trickle-down economics, unfunded tax cuts and an ideological slashing of protections for workers and the environment—no wonder the former Prime Minister and Chancellor were removed from office so quickly, and no wonder the current Chancellor has had to U-turn on almost every measure. The truth is that this economic crisis was created in Downing Street. The damage has been done, and working people will be paying the price for years to come.

Part of the reason for the Conservatives’ failure to grow the economy as it could have been growing over the last decade has been their failure to invest in the infrastructure our country needs. As we look ahead to the coming decade, investment in our country’s response to the climate emergency could not be more critical, both to protect the environment and to grow the economy.

That is why Labour’s green prosperity plan is so important. Under our plan, we would invest in wind, solar and nuclear power to make our electricity system zero-carbon by 2030, we would insulate 19 million homes across the country, bringing down carbon emissions and people’s home energy bills, and we would invest in new jobs in industries of the future, from electric vehicles to clean steel.

We recognise that the UK Infrastructure Bank can play an important role in supporting essential investment. We therefore welcome the fact that one of its objectives, set out in clause 2 of the Bill, is to help tackle climate change. But setting up the bank is not enough on its own; we need a Government who will drive forward the agenda of green investment that we need. Sadly, the Government’s record makes it clear that they will fail to rise to that challenge.

There is evidence of that failure littered throughout the past 12 years. Ten years ago, the Government set up the Green Investment Bank. Five years later, they sold it off to a private equity group. The Public Accounts Committee said that the bank had

“failed to live up to original ambitions”.

The Committee was clear that, in selling it off, the Government had been focused on

“how much money could be gained from the sale over the continued delivery of GIB’s green objective.”

Supporters of the current Prime Minister on the Conservative Benches may remember that, two years ago, the then Chancellor published a video on his YouTube channel titled: “Rishi Explains: Green Home Grants”. In that video, the now Prime Minister excitedly announced that the brand-new green homes grant scheme was open for applications. However, I was not able to find any videos of him explaining why the green homes grant scheme closed six months later and saw £1 billion cut from its budget. Although he seems to have forgotten to make a video explaining that, the Environmental Audit Committee was happy to set out its views. In its report, “Energy Efficiency of Existing Homes,” it concluded that the scheme had been

“rushed in conception and poorly implemented”

and described its administration as “nothing short of disastrous”.

[Richard Fuller]

The Opposition spokesman talks about the importance of sticking with plans and of permanence. That is quite right; this is infrastructure, which lasts a long time. Will he therefore use this opportunity on the Floor of the House to give the assurance that, should Labour form a Government in the near future, it will make no changes to the objectives listed in the Bill?

--- Later in debate ---

[James Murray]

It would be a strange parliamentary procedure for the Opposition to commit to a Bill that has not even passed into law yet; let us see what happens in Committee and on Report and what the Government do, and indeed what we inherit when we become the next Government if we win the next election. So much has changed over the last few weeks; we do not know exactly what we are going to inherit and it is not sensible to make commitments now. We will set them out in our own time ahead of the next election.

Of course, the Government’s record of failure over the last 12 years continues to this day. In January, the Government pledged £l00 million to help Britishvolt, a UK battery start-up company, to build its planned battery gigafactory in Blyth, but when Britishvolt faced a critical hurdle yesterday and needed to access some of that funding, the Government refused. If the Government are not prepared to back a British business investing in green technologies and new jobs in Blyth, what on earth are they doing? When this money was announced, the then Business Secretary said the new factory was

“exactly what levelling up looks like.”

It turns out he may have been right, as this is exactly what levelling up looks like under this Government: broken promises, a record of failure, and a Government unable to deliver the investment and jobs we need.

The truth is that the Government and the newly appointed Prime Minister have a record of failure on investing in green infrastructure for our country and our economy. So, while we welcome the new UK Infrastructure Bank and its focus on tackling climate change, we know that no matter how well it plays its part, the British people need a Government with an effective plan to make the investment in the jobs, homes and energy supplies of the future a reality.

I have focused so far on the first of the UK Infrastructure Bank objectives set out in this legislation: helping to tackle climate change. The second of the two objectives in the legislation is also critical for the bank’s success, and is described as being

“to support regional and local economic growth.”

We firmly support that objective, and we want to see all parts of the country benefit from investment in green jobs of the future, along with improved rail and other transport services, and other essential modern infrastructure, including broadband. But when it comes to supporting economic growth across the country—“levelling up” as the Government used to call it—we know that words ring hollow unless people see change. That is why clause 2(6) is so important, as it seeks to make sure the bank has regard to the first mission of the Government’s “Levelling Up” White Paper when exercising its functions under this Bill. We have heard rumours that the Government may seek to remove this new requirement from the Bill now that it is back in the Commons. I am sure the Minister will agree that doing so would make it clear the Government have abandoned their commitment to levelling up, so I urge him in his closing remarks to confirm that this requirement will remain in the Bill.

Finally, along with doing all it can to help tackle the climate crisis and to support economic growth, we believe that the UK Infrastructure Bank must also play its part in helping create good-quality jobs with decent pay and conditions. All businesses and bodies receiving public money from the UK Infrastructure Bank must have a plan to create those good jobs with decent conditions, and there must be tough contractual sanctions to make sure those commitments are honoured. To make sure the bank keeps that focus on good jobs at the heart of its approach, there must be a worker representative on its board.

After 12 years of low growth from the Conservatives, there is a vital need to invest in the infrastructure of the future. We need to invest across the country in new transport, new digital infrastructure, new sources of energy that are sustainable and secure, and new high-quality jobs with decent pay. That is why we support the establishment of the UK Infrastructure Bank and this Bill’s aim of putting it on a statutory footing.

We will of course press Ministers in the Commons Committee and Report stages to improve this legislation, and, as well as seeking changes from Ministers, we will defend changes made in the Lords that we believe have improved the Bill. Alongside the insertion of levelling up targets that I have mentioned, we welcome the amendment that changed the definition of “infrastructure” to refer to the circular economy, nature-based solutions and energy efficiency. We further support those amendments that strengthened requirements on the Government to have a more regular and meaningful review of the bank’s effectiveness and impact.

However, even if we succeed in strengthening this Bill and the operation of the bank, we know the country needs far more from its Government. We need a Government who will use this bank as part of a far more ambitious plan to grow the economy, to make the transition to net-zero, and to create jobs and industries in all parts of the country.

The record of this Government to invest in greener homes, energy, and jobs is one of failure. The latest so-called “growth plan” from the Conservatives crashed the economy, and their newly appointed Prime Minister is doomed to fail, as he is trapped so tightly by a need to put his party first, leaving the country second. The truth is we need a fresh start to face the challenges of the future, and the sooner the British people get the chance to have their say, the better.