Space Industry (Indemnities) Bill

Jerome Mayhew Excerpts

Friday 7th March 2025 Commons Chamber

[Jerome Mayhew (Broadland and Fakenham) (Con)]

What fun we have had. We could have proper jobs, but instead we are talking about space industries and debating their importance. I recognise the ambition of the last Government; when deciding which Department should monitor space industries, one might have thought it would be the Department for Science, Innovation and Technology, but no—we thought it should be the Department for Transport.

I am delighted to stand in front of you, Madam Deputy Speaker, to support this hidden jewel in our high-value industry. In the latest data that I could find, from 2023, the industry has revenues in the United Kingdom of £18.9 billion. It is supported by about 1,800 businesses, the vast majority of which are SMEs, right across the country in all our constituencies, developing the small satellites that are the particular expertise of Glasgow. This is the first time that I have had a Glasgow mafia of MPs in the Chamber all underselling their own constituency or city, because while they said that Glasgow produces more satellites than any other city in Europe, I believe the Department for Transport said in the previous debate in February 2024 that it is the largest manufacturer of satellites in the world outside of California.

There are 52,000 full-time equivalent workers employed directly in the sector. If we add in a supply chain of about 130,000 people across the country, we can see that this is already a very significant sector. It is growing in terms of employment, at 6.7% per year, and in terms of investment. Again, in 2023, the last year for which figures were available, there was investment of £8.85 billion into the space industry in the UK, and there is huge opportunity for more growth.

Applications for small satellites are going through the roof—on their way to orbit—and the geography of the UK is almost uniquely suitable for low Earth orbit satellites. Whereas the large satellites that we used to send up into space need to be sent up near the equator, being closer to the north pole makes launches into low Earth orbits more suitable. The other thing we have is lots of sea around us in case it all goes wrong. Additionally, the increase in the geopolitical uncertainty of the world makes it more important than ever that we develop our domestic capabilities in this area.

For all those reasons, the last Conservative Government backed commercial spaceflight from the UK and created the founding instrument for the industry, the Space Industry Act 2018. It created the legal framework for commercial spaceflight, and it was followed up in 2021 by the creation of a spaceflight regulator—the Civil Aviation Authority. I am proud to say that we took advantage of the genuine Brexit benefit of being able to create a regulatory environment far faster, and in a more comprehensive fashion, than our EU friends over the water have been able to do. It gives us a genuine commercial opportunity for rapid growth, which we have already seen.

Although the Space Industry Act 2018 is good, it is not perfect. As we have seen from yesterday’s news in Florida, when we occasionally have what is described as a “rapid unscheduled disassembly”, what goes up can come down. When it does so, it can cause loss and damage. UN space treaties make nation states responsible for loss and damage caused by space activity launched from their territorial areas, and it is for this reason that section 36(3)(a) of the 2018 Act passed financial responsibility from the state to the operator, requiring that the person carrying out spaceflight activities must indemnify His Majesty’s Government for loss, subject to any limit set out in section 12(2), which gives the regulator—the Civil Aviation Authority—the power to set an upper limit for that indemnity.

The rationale for a limit on indemnity is clear: without it, it would be impossible for insurers to assess the quantum of risk associated with an unforeseen event. In actuarial terms, if we cannot assess the quantum, the risk can no longer be insurable, yet we have already imposed through legislation a legal duty on any space operator to have sufficient insurance, which prompts the question of what insurance is sufficient. This issue has been identified and is the genesis of the two-clause Bill that we have before us today. The problem with the wording is that the cap on the indemnity is not mandatory; the Bill simply allows for a cap.

Before taking an investment decision that could involve many hundreds of millions of pounds, big investors need reassurance beyond a Government policy statement to give them the confidence to commit large sums for investment, and this Bill fixes the problem. Section 12 turns the power to cap an indemnity into a requirement to do so. The last Government supported a private Member’s Bill introduced by the former Member for Woking, Jonathan Lord, which had suspiciously similar drafting terms. The Second Reading of that Bill was held on 23 February last year and, to my great disappointment, the legislation was lost in the election wash-up as we approached July.

His Majesty’s loyal Opposition wholeheartedly welcome the reintroduction of the Bill today. If nothing else, it has given us an opportunity to rehash some rather painful space puns—Hansard is still reeling from last time. I have read Hansard from February last year, and there is a noticeable difference in the kinds of space puns used. From Labour Members, I am sorry to say that we have had references to Trekkies, “Flash Gordon” and “Star Wars”. From the Conservatives, we have had references to “The Clangers” and the Soup Dragon, which are much more patriotic.

Other contributions to today’s debate are worthy of mention. I have already referred to the over-representation from Glasgow—the city’s MPs spoke for about half the debate—but some very serious points have been made. The hon. Member for Glasgow East (John Grady), who I think is the first space lawyer in Parliament, spoke about the geopolitical risks and the need for a satellite launch capability in the United Kingdom. The hon. Member for Glasgow North (Martin Rhodes) noted that about 20% of all space jobs are in Scotland, and the hon. Member for Cumbernauld and Kirkintilloch (Katrina Murray) highlighted the increased role for women in the sector and the potential to break down stereotypical barriers, for which I commend her.

Moving south of the border, the hon. Member for Luton South and South Bedfordshire (Rachel Hopkins) made unfortunate references to both “Flash Gordon” and “Star Wars”, but she also made a serious point about the opportunities for young people in her constituency and beyond. Moving further south still, the hon. Member for Isle of Wight West (Mr Quigley) commented on what a time it is to be alive—I agree with him. He will have noted that the previous career of the hon. Member for Glasgow East was chargeable by the hour, which might explain the position in which we have found ourselves.

All those contributions recognise the hugely important role that space already plays in our economy and the incredible opportunity that the sector has to drive growth for all of us. The Bill gives the Minister the opportunity to confirm that His Majesty’s Government, despite the change in party, remain fully supportive of space industries and that he is wholly behind the Government’s target for the UK to be the leading provider of commercial small satellite launches in Europe by 2030.

I congratulate the hon. Member for Glasgow East on proposing this legislation. It changes two pesky words—just six letters if we add them up—but is six years in the making, which begs the question about the speed at which our legislative processes are able to operate. After the first Bill’s rapid unscheduled disassembly in the general election, I hope this Bill has a smooth lift-off and takes its place in the firmament of British legislation.