Budget Resolutions

Lloyd Hatton Excerpts

Monday 1st December 2025 Commons Chamber

[Claire Coutinho]

Let us talk about that £150. If someone has a gas boiler, the figure is £130. I remind the Secretary of State that that is almost everybody in the country. Oh yes, and if they pay tax, the amount has not come off—it has just been moved from their energy bill to their tax bill. Most importantly, that amount does not even touch the sides of what this Secretary of State will cost people in the end. Like so much of what Labour says, it is just sleight of hand. The real question is this: since the election, have bills gone up or down? The answer is up.

The Secretary of State should be honest that this policy was never part of his plan. It is not part of Great British Energy or clean power 2030—all the things that he promised would lower bills. In fact, it is a tacit admission that he has failed. The centre knows that his plan cannot lower bills. In fact, if the reporting is correct, the Secretary of State fought against the policy, but he has been forced into it, because his promise to cut bills by £300 has become a national embarrassment to them all. It is taxpayers who are bailing him out to the tune of £7 billion.

[Lloyd Hatton (South Dorset) (Lab)]

Does the right hon. Lady not share the concerns already articulated by the Confederation of British Industry that simply to scrap the Climate Change Act and the important work of this Government in pursuing net zero targets would be a “backwards step”? That would actually be to the detriment of people’s energy bills and inward investment into our economy and would kill off jobs. Those are the words of the CBI, after all.

--- Later in debate ---

[Claire Coutinho]

Let me make this point to the hon. Gentleman. The average person on benefits in work is working 20 hours, sometimes less. Why should a family with kids who are not well off and are working 40, 50 or 60 hours a week be worse off than a family on benefits working far fewer hours?

I quit a job in the City to go to work for the Centre for Social Justice and work with people fighting poverty, and I have worked with struggling families in some way since I was 16. It is not compassionate to make welfare pay more than work. It is not a helping hand; it is a trap.

The Government should also talk to the many couples who have put off having children or stopped at one or two children because they cannot afford it. Younger brothers and sisters simply will not be born. Those missing children are a personal tragedy for every couple who are having to make that choice, but there will be more of those decisions, because the Government are loading more and more costs and taxes on to hard-working families.

[Lloyd Hatton]

Can the right hon. Lady explain to the House what it would mean for the 1,360 children in her constituency, and the nearly 1,700 children in my constituency, who would remain in levels of relative poverty if we chose to pursue the two-child benefit cap for many more years, as she is suggesting?

[Claire Coutinho]

We have a fundamental difference in belief. Labour Members believe the best way out of poverty is welfare; I think the best way is jobs and growth, but the Government are killing those things.

The problem with the Labour party, as we can see from its policies, is that it clearly thinks the only answer to the cost of living is redistribution, even past the point at which there will be no one left to redistribute from. Conservative Members know that jobs, low taxes and low costs improve the quality of life, but the Government are killing those jobs—every month under them, parents are losing their jobs. What do Labour Members think the cost of living is like for those families who have lost their salaries under this Labour Government? There are 170,000 fewer people on the payroll since the election. Young people cannot get a foot on the jobs ladder—because of this Government, the cost of hiring a young person has gone up by £4,000. They say they are raising the minimum wage, but they are crushing businesses’ ability to pay for it. The result is hiring freezes and redundancies, and for all those people just above the minimum wage who are also struggling, there will be no money left for wage progression. The best way to improve living standards is growth, but this was not a Budget for growth; it was a Budget for Labour Back Benchers. That is why it did not contain a single growth measure.

Labour’s entire approach to the economy has been to raise the cost of basic goods, to raise taxes, and to crush wages and employment. The Government are expecting a shrinking group of hard-working taxpayers to pay for more redistribution, to cover the costs that they are choosing to impose on the public. In the words of one Labour Cabinet Minister, this Budget has been a “disaster”. Those are not my words—according to a No. 10 source, they think they are the words of the Secretary of State. Labour will not be known as the party helping people with the cost of living; it will be known as the party that has broken its promises to working people, broken its promises on tax and on bills, and broken the social contract that sees work pay more than welfare.

Energy Resilience

Lloyd Hatton Excerpts

Tuesday 6th May 2025 Westminster Hall

[Tom Collins]

I agree that with the correct technology, those systems can provide local resilience.

The fundamental change to the core role of the energy system has been from efficiency to storage. How we achieve that future system is already well debated. We start with energy efficiency and insulation, then we move on to shifting the time of demands, and we can enhance that with intraday storage in some buildings. The way we actively control and manage the response to demands and our storage is the big question for the future electricity system.

Currently, moment-by-moment control is achieved technically using the A/C power itself as a signal. Control over longer time bases is co-ordinated and partially directed through markets. In the future, we expect markets to play a bigger part in our electricity system, working in shorter timeframes and in a more distributed way. When we think about resilience, the design of our economic and commercial energy system and the digital systems that enact it will be absolutely critical. The commercial energy system will be as critical as the physical one.

Whereas markets may be good for some resilience attributes such as flexibility and diversity, they are often bad for others, such as redundancy, continuity and headroom. Also, our new digital communications channels offer potential single points of failure for our system. This is a fundamental question of national security. In the light of a string of cyber-attacks, it is crucial that when our digital world fails, our heating, lights, sanitation and vehicles must not. Either our grid must not depend on signals such as dynamic pricing to keep working, or those signals must be multiple-fault tolerant. With distributed generators playing a larger role in future, avoiding cascade failures requires them to support graceful degradation instead of disconnecting in the face of uncertainty.

This dynamic, digitally enabled future can introduce other risks, not only for resilience but for social equity. It must not penalise those who cannot afford battery storage, and each internal system boundary and each new pricing location threatens overall value. Alongside markets, our systems must incorporate core features that function primarily in the public interest. The system must be resilient against market-induced price instability and commercial failures, both for our security and for those markets to function healthily.

That all misses the single largest and most novel component of our future energy system: clean, long-duration energy storage at scale—storage, not just for seconds through inertia, not just for minutes through demand-side response, and not just for a day or night through in-building storage, but intraweek and longer to ride through long stagnant weather events or other major disruptions. Today, our energy resilience is assured by the incredible flexibility and capacity of fuels: oil in transport and off-grid heat, and methane gas for heat in buildings and industry. Those fuels intrinsically store energy indefinitely and carry vast amounts of energy through simple infrastructure, such as pipes and tanks. Our gas system currently carries three times as much energy each year, and up to four times as much in a day as our total electricity system. It shares its energy storage capability with the electricity system through gas power stations, our core electricity resilience assets. We have found our dependency on gas to be a weakness, but only because we depend on it for our system’s strength.

So, we face a crux. How might we win the energy resilience prize, benefiting from the clean versatility of electricity and the stabilising, security-critical storage capability of fuel? There is one answer that the UK has itself pioneered. There is a fuel that is carbon-free and 100% interoperable with electricity, and capable of being manufactured from electricity and cleanly converted back into it again at will: hydrogen. The Government, and others, have spotted the unique potential of hydrogen to fuel a clean and secure future for British industry. I would argue that they could go further, enabling industrial renewal in and around national clusters, but also in our towns and suburbs. As we seek to secure a material supply chain, the UK could deploy our immense wind resource and become a circular economy material recovery superpower of Europe.

Over recent years, however, the debate has become paralysed by an either/or question. Electrification and hydrogen have been presented in some sectors as mutually exclusive. Hydrogen has been presented as scarce and expensive. Policy has been asking whether the answer in various sectors is electrification or hydrogen, but the design answer is resounding and simple: it is both. These two energy vectors are complementary, with hydrogen power stations able to provide our grid with headroom, responsive generation and inertia, and hydrogen storage able to provide our national asset of inter-day and inter-week energy storage. Our future electricity system needs hydrogen, and at a vast scale. The truth of the matter is that hydrogen will be as cheap and abundant as we design it to be.

[Lloyd Hatton (South Dorset) (Lab)]

I thank my hon. Friend for securing this important debate. The Dorset clean energy super cluster, in my constituency, has proposals for fixed and floating offshore wind, carbon capture and storage, and hydrogen storage. Does my hon. Friend agree that having all that energy generation and storage in one place is a really effective way to boost Britain’s energy resilience, and to quickly boost our energy infrastructure and our ability to create, store and distribute energy here in Britain, rather than being dependent on energy coming in from overseas?

[Tom Collins]

I thoroughly agree with my hon. Friend. I am so glad that Members have identified how critical it is that we have a diversity of energy sources, that we have energy storage, that these are distributed around our system, and that we invest ambitiously now to bring them into reality.

Our energy system has always been multi-vector, and it must be in the future, too. By embracing this reality, we have an opportunity to design and choose how our electricity and gas systems are coupled: upstream through underground gas storage and power stations; mid-system with smaller distributed generators, including fuel cells; downstream in areas on constrained legs of the network; or perhaps even in homes through smart hybrid heating systems. We can deploy hydrogen production wherever it is most helpful: offshore, onshore, or at critical nodes in the transmission system. Pipe infrastructure is relatively low cost, high capacity and, being underground, intrinsically secure.

The size of our supply of green hydrogen is our choice. If we choose constrained supply, we choose constrained growth. If we choose ambition and abundance, that will also be worked out in our economy. It is time to move on from old ways of thinking. There is virtually no risk of stranded assets; investment in both electrical capacity and hydrogen production is zero regret. The call to action for both sectors is simple: go big. That is, and must remain, the message of the Government.

Now is the time to convert this ambition into concrete goals in the technical domain. Industry’s voice is clear: there is an urgent need for decision making. We must deliver our ambition not by iterative cycles of consultation, but rapidly through partnership. We need to short-circuit policy silos, get all the stakeholders in a room and thrash it out. We must be open to answers that back multiple technologies. Our problem is not that we need a silver bullet, but that we had one that was literally too good to be true. Moving on from fossil dependency means diversification.

Historically, we have always relied on multiple energy vectors in homes to provide energy resilience. That is still an option now. It means moving away from questions of either/or to answers of both/and. Those decisions are not easy, but they can be made. The end point is not crystal clear, but it is sufficiently in focus. Our industrial community has the knowledge and evidence we need, and the risks from here can be managed.

This is a moment for leadership and, fortunately, this Government have the will and the opportunity to deliver it. As corporate players scramble to shape this debate to create future opportunities, investors are seeking a clear statement of ambition and for the Government to get hands on, set goals and pick winners. Recognising that there will be more than one winner in a diverse and resilient future, we can show ambition now for electrification and a powerful UK hydrogen economy.

In the end, a resilient energy system is about putting people first and making power, warmth and movement dependable, affordable and accessible to all. Seventy-five years ago, the UK built energy systems with world-leading reliability and resilience. Now it is time to do it again, and to secure a new era of economic renewal, growth and security. With ordinary people as our guiding star, through ambition, pragmatism and practical collaboration, we can deliver an energy that, for the next 75 years, through night and day, come rain or shine, dependably keeps every single person in our fantastic nation empowered.