Wales Bill

Lord Elis-Thomas Excerpts

Committee: 3rd sitting (Hansard): House of Lords
Tuesday 15th November 2016 Lords Chamber

[Baroness Morgan of Ely]

My Lords, this amendment, which concerns sea fishing, is a little bit complicated, so I hope that noble Lords will bear with me.

The Welsh Government already have executive competence for fisheries functions in the Welsh zone. In other words, it is now up to Welsh Ministers to determine what happens in relation to fishing anywhere within the 12-mile zone of Wales. This power is now extended to allow Welsh Government Ministers to have executive powers over Welsh fishing boats, whether they are in Welsh waters or UK waters. Take a Welsh fishing boat that is fishing off the Norfolk coast, which is within British fishery limits and would currently be subject to the licensing rules set out by UK Ministers. In future, when this power is transferred, it will be up to Welsh Ministers, by their rules, to license those Welsh fishing boats, whether they are in Welsh waters or in UK waters—obviously excluding Scottish waters.

That is all very nice and dandy for Welsh Government Ministers. However, there will be no oversight of Welsh Ministers because the Assembly—not the Government but the Assembly Members, like me—would not have any say on or sight of what is happening because the Assembly lacks the legislative competence to regulate fishing activities beyond the area of the Welsh zone. These are currently UK Minister powers, and so we come back to the issue of the alignment between legislative and executive functions.

This will become increasingly more important with Brexit on the horizon, because fishing is, of course, an area of devolved competence. The executive powers that are being transferred are the powers to require Welsh fishing boats to have a licence before they can fish outside the Welsh zone. For example, the licence could specify that you cannot fish for certain types of fish or that you must use approved fishing methods. At the moment, these fall under the EU common fisheries policy. Scotland currently has the legislative competence in relation to both the Scottish zone and Scottish fishing boats outside that area. The proposed amendment seeks simply to bring the Welsh Assembly’s legislative competence in line with the Scottish legislative competence and help align the Assembly’s legislative competence with Welsh Ministers’ executive fisheries functions. I hope that that is clear. I beg to move.

[Lord Elis-Thomas (Non-Afl)]

My Lords, I support this amendment from my noble friend Lady Morgan. It is in line with a more general issue that I raised earlier about the relationship between the executive competence of Welsh Ministers and the parallel competence, where it currently applies, of UK Ministers, and the competence of the Assembly itself and its ability to legislate and scrutinise. This is a fundamental issue and flaw in the Bill that we are now discussing. It is particularly reprehensible in the case of fishing.

I had the proud duty of trying to represent the northern part of Cardigan Bay. This will be well known to the Minister because he was based in the middle of Cardigan Bay for a very long time and, as far as I know, may still have a bolthole somewhere in the region—I will not pursue that in this debate. He also had a role further south-west in Milford Haven and so will know well the nature of the Welsh fishing industry and how it has been denuded over the years as a result of the reduction in the number of vessels and, more recently, the activity undertaken by the Welsh fisheries association with strong support from the Welsh Government in restoring and developing inshore fishing in order to ensure that we have product to promote Welsh fisheries as part of the Welsh food and drink initiative, which is currently the flagship policy of the Welsh Government. Therefore, I ask the Minister to take a further look at this.

It is essential, in my view, that we should be able to have direct oversight of our natural resources and not be in a situation where the oversight of the natural resources of Wales—in this case, the increasingly important marine resources—is located elsewhere.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

My Lords, I thank all noble Lords who have participated in the debate on Amendment 53, in particular the noble Baroness, Lady Morgan of Ely, who moved it. It seeks to reserve sea fishing outside the Welsh zone but makes an exception to that reservation for Welsh fishing boats. The notional effect of the amendment would be that the Assembly would have legislative competence for Welsh vessels outside the Welsh zone. However, in practical terms the amendment would have no effect because it seeks to reserve a power which the Assembly could not have. Under the Government of Wales Act 2006 and under this Bill, the Assembly’s legislative competence extends to the landmass of Wales and the sea adjacent to Wales out as far as the seaward boundary of the territorial sea; that is, 12 nautical miles, so as drafted it could have no effect. The Assembly has no legislative competence beyond that 12 miles—

[Lord Elis-Thomas]

The Minister will remember of course that before 2006 Wales did not even have a sea.

[Lord Bourne of Aberystwyth]

My Lords, I am going on to tackle the point made by the noble Lord. The Assembly has no legislative competence as things stand although Welsh Ministers can exercise executive functions in that part of the Welsh zone beyond 12 nautical miles in so far as these have been conferred by United Kingdom enactments.

I take the points that have been made in relation to fishing, but as drafted we would need to look at the amendment. It proposes something fairly fundamental to the extent that it would vary the geographic extent of the Assembly’s competence. I would want to go away and have a look at that to see how it could be refined, if that is possible. This is not something that was considered by Silk or by the St David’s Day agreement and, as drafted, the amendment goes well beyond the issue of fishing licences.

My noble friend Lord Deben referred to some of the ramifications in relation to fishing policy as it exists at the moment through Europe and as it will exist in the future outside of Europe, but that is obviously still something to be refined. I want to reflect on that as well.

My noble friend Lord Crickhowell asked about the licensing of fishing vessels and the position in his former constituency of Pembroke—Preseli Pembrokeshire as it now is. I can well remember as an elected representative in the Assembly for that area going at about four o’clock in the morning to the fish market at Milford Haven to speak to electors. All the electors there were Spanish electors, although they did have vehicles that were licensed in Wales as part of the United Kingdom. I think that that remains the position at the moment, but how it will pan out post-Brexit I do not know.

If I may I will take the amendment away and look at it, but based on the fact that there are far more ramifications to this than just fishing, and even in relation to fishing there are of course considerable ramifications—beyond 12 miles it is an economic zone for the state of the United Kingdom and we would exercise powers in relation to that for the whole country. On the points made by the noble Lord, Lord Elystan-Morgan, I thank him for his always gentle and complimentary approach which has me doing things I would probably not normally agree to; I recognise the dangers. I hope that we have looked at things in relation to this legislation on a pragmatic basis because that is the way to approach it. Any general rule is going to have to give way to exceptions because as we can see there are always difficulties in these things. Sometimes they look much more straightforward than they are. My door is always open and we have set up meetings with many noble Lords. I am happy to do that, but as I say our approach to the legislation is a good British pragmatic one. I will look without prejudice at what I think is a much more difficult area than perhaps it looks on the face of it. With that, I hope that the noble Baroness will feel able to withdraw her amendment.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lords who have participated in the debate on these amendments, which relate to water. I particularly welcome the contribution of the noble Lord, Lord Wigley, who moved his amendment with sensitivity and fairness on an issue which I know is very close to his heart. The Government are determined that never again should there be a Tryweryn. That is at the back of all our thinking on this issue.

I welcome the contributions from around the Committee. My noble friend Lord Hunt of Wirral spoke with passion of his time in north Wales, and the noble Lord, Lord Morgan, talked of his home county of Meirionnydd. I also welcome the contribution of the noble Lord, Lord Elystan-Morgan. I could not agree more with the sentiments that they expressed. I also thank my noble friend Lord Crickhowell—with his background and experience as chairman of the National Rivers Authority—for bringing his authority to this issue: aligning the border is not necessarily straightforward.

Water is of symbolic importance as well as practical significance to Wales. It evokes more passion and debate than probably any other issue relating to Welsh devolution. It is not just about Tryweryn; as the noble Lord, Lord Thomas of Gresford, reminded us, it is about the Dulas Valley as well, and there have been other issues. I thank noble Lords for contributing to the debate from the viewpoint of their own experiences. The strength of feeling has been amply demonstrated in their speeches.

In announcing the Government’s intention to devolve pay, my right honourable friend the Secretary of State for Wales signalled that the Government were exploring other aspects of the settlement to ensure that it is as clear and fair as possible. Yesterday, my right honourable friend Alun Cairns announced the Government’s intention to remove the Secretary of State’s powers to intervene on water and to replace them with a statutory protocol on water between the United Kingdom Government and the Welsh Government. Work will be done on that, and we hope to have the detail ready for Report.

That is a highly significant announcement. Water has been a challenging issue, as anyone familiar with recent Welsh history will know. The replacement of the intervention powers with a formal protocol marks a step change in the history of Welsh devolution—one that resolves past differences and provides clarity for the future. The move also removes any last impediment that there may be—at least in terms of this Bill; I hope the noble Baroness will be able to clarify this—to the Assembly giving its approval to the Wales Bill, subject of course to agreement on the fiscal arrangements.

The existing intervention powers were put in place in the Government of Wales Act 2006, when Peter Hain—now the noble Lord, Lord Hain—was Secretary of State. Since then, there has been a great deal of development in relation to devolution. This Bill marks a move to a new, durable and lasting devolution settlement, underpinned by a recognition of the maturity of the Assembly and the Welsh Government. In keeping with this, it is time to replace the Secretary of State’s powers to intervene on the Assembly and Welsh Ministers in relation to water with a statutory protocol between the United Kingdom Government and the Welsh Government which defines how the two Governments will work together on water-related issues—in particular, cross-border issues.

I confirm that the Government intend to bring forward amendments on Report to put in place the requirement for a formal agreement and to remove the intervention powers. In doing so, it will be important to respect the interests of water users in both Wales and England. As my noble friend Lord Crickhowell exemplified, this is not necessarily straightforward in every respect.

[Lord Elis-Thomas]

I am excited not just by the environmental and political aspects of this but by the constitutional implications. Can the Minister help us by indicating whether establishing a protocol in relation to powers between the Assembly and this Parliament, and indeed between the Welsh Government and the UK Government, is something that he would consider in other areas of policy in the Bill?

[Lord Bourne of Aberystwyth]

My Lords, as I have indicated, working together between the Government in Cardiff and the Government of the United Kingdom is of interest to all of us who believe in an effective United Kingdom and an effective Wales. So, yes, I am certainly in favour of that, as I have indicated. In so far as we can provide for that, the Government are open to looking at it. With the excitement of that intervention, I have lost my place.

[Lord Elis-Thomas]

The temptation to intervene was too much.

[Lord Bourne of Aberystwyth]

I fully understand.

It will be important to put in place a protocol with bite. Both Governments will be subject to a duty to act in accordance with the new agreement and, once it is in place, both will need to agree any changes to it. The agreement will also need to include a process for resolving any disagreements that both Governments will sign up to.

It is as yet too early to say how soon the new arrangements will be agreed, but the Government will repeal the Secretary of State’s water intervention powers once an agreement is signed and sealed. This historic commitment to remove the intervention powers paves the way to conclude the Government’s consideration of the wider devolution issues relating to water and sewerage, including the sewerage intervention powers currently in Clause 46 of the Bill and the question of whether powers over water and sewerage should be aligned with the England-Wales border.

The Silk report recognised that water and sewerage devolution was complex and that further work was needed to consider the practical implications of implementing the commission’s recommendations. Following the St David’s Day agreement, the Government set up the joint Governments’ programme board with the Welsh Government to look at these issues and report on the likely effects that implementing the recommendations would have on the efficient delivery of water and sewerage services, on consumers and on the water undertakers.

That work has concluded and the Government have been considering the evidence that has been collected. In doing so, it has been particularly important to consider carefully the interests of customers and businesses on both sides of the border before reaching a decision on the recommendations. It remains the Government’s intention to bring forward provisions to implement the recommendations, if such a thing is achievable, and I hope to be able to return to this on Report.

I will now turn to other water-related amendments that are not Silk recommendations. Amendment 104, tabled by the noble Baroness, Lady Morgan of Ely, seeks to amend the Water Industry Act 1991 as it relates to Ofwat. Part of this amendment would require the Secretary of State to seek the consent of Welsh Ministers before making directions to Ofwat, outlining her priorities for keeping the activities of water companies under review. This would occur where these directions apply to Welsh water companies and licensees carrying out activities in the areas of those companies. This requirement for consent would cover all of Ofwat’s functions, including those applicable to policy areas reserved to the Secretary of State, such as those relating to competition law, insolvency and mergers. This would give the Welsh Ministers considerable influence over policy areas that are not devolved.

The noble Baroness’s amendment would also place a requirement on Ofwat to make its annual report to the Assembly rather than just send it a copy, as is currently the case. At present there is nothing to prevent the Welsh Ministers laying before the Assembly the annual report that Ofwat sends them or publishing it in any manner they see fit.

The amendment requires appointments to Ofwat’s board to be made jointly by the Secretary of State and the Welsh Ministers. Other amendments seek to grant Welsh Ministers joint powers with the Secretary of State over board members’ terms and conditions. Currently, the Secretary of State makes all appointments following consultation with the Welsh Ministers and consults them on some other aspects. In practice, this means that the Secretary of State writes to the Welsh Ministers to seek their views on an applicant before confirming the appointment. However, the Welsh Government are also invited to sit on the appointment panel, which is chaired by Defra. This, along with the various requirements to consult Welsh Ministers, already provides the Welsh Government with considerable influence over the process and final appointment decisions.

Amendment 105 in the name of the noble Lord, Lord Wigley, concerns the abstraction of water from Welsh reservoirs. As I think I have indicated, I share the views expressed by noble Lords today: the events of some 50 years ago which resulted in the flooding of Tryweryn were some of the darkest and most regrettable days in modern Welsh history. Never again.

In answer to the question raised by the noble Baroness, Lady Morgan—I am delighted to note that she did not wish to be churlish; I welcome that very much—decisions about the construction of new reservoirs and environmental controls are already devolved to the Assembly. However, we are going further—and rightly so. The Assembly exercises legislative competence in relation to both issues: construction and environmental controls. The Welsh Ministers would need to issue a compulsory works order to allow the construction of a new reservoir to take place. It is within the competence of the Assembly to give itself a role in the issue of consent orders.

Natural Resources Wales is the environmental body which regulates abstraction in Wales. Again, the Welsh Minsters and the Assembly can legislate to change or add to its powers. Nevertheless, as announced yesterday by my right honourable friend the Secretary of State, the Government intend to remove the Secretary of State’s powers to intervene on water and replace them with a protocol. I think that that is in the spirit of where we need to be in relation to this totemic and practically significant area of water. On that basis—

--- Later in debate ---

[Lord Bourne of Aberystwyth]

My Lords, I am happy to clarify that point. I believe that the existing powers in relation to the Welsh Government and Welsh Ministers are sufficient, but I am very happy to look at that issue and cover it in the protocol, which could extend to that if it is something that we should be doing. I will happily discuss that with the noble Baroness.

[Lord Elis-Thomas]

The Minister will recollect that we worked together in the National Assembly. I looked at this issue at the time and I can reassure him and the House that the way in which he described the current position in planning and environmental law is indeed the position. But of course that does not mean that we cannot strengthen it by making indications about the intervention powers of the Secretary of State. On that, I think we are all agreed.

[Lord Bourne of Aberystwyth]

I am very grateful to the noble Lord for reminding me of the years of co-operation we had in the National Assembly for Wales and for clarifying that issue in the way that he did. On that basis, I hope that the noble Lord will consider withdrawing his amendment.

--- Later in debate ---

[Baroness Morgan of Ely]

My Lords, this Bill proposes that the Assembly will gain competence over all renewable energy generating projects of up to 350 megawatts in Wales and in Welsh territorial waters. Amendment 55A suggests that the UK Government have gone too far in their intention to reserve their power to legislate over electricity, including the generation, transmission, distribution and supply of electricity. Although of course we recognise that it is important to have a single market in energy, ideally not just in the UK but across the EU as a whole, we contend that under the system proposed by the UK Government opportunities for the development of energy production in Wales will be stifled.

Here, I should probably declare an interest. It is not a current interest but an interest that I had in the past while I was working for an energy company in Wales. Part of my remit was to help develop a significant wind farm in mid-Wales. Let me tell you that the legislative process was chaos. The Welsh Government had more or less invited wind farm companies to develop wind farms in specific areas in Wales, but the decision as to whether permission could be given to develop a large wind farm was the responsibility not of the Welsh Government but of the UK Government.

On top of that, the wind farm needed to be connected to the grid. A 132 kV line—that is, a small electricity line on a pole—from the wind farm to the main national grid needed to be approved, not by the national Government but by the local authority. This could be called in by the National Assembly. These little electricity lines then needed to be connected to a large electricity substation—the places where you see the twirly bits in areas where the electricity goes in. That would convert the voltage from 132 kV to 400 kV, which is for the national grid. The responsibility to allow the building of the substation lay with local government, which again could be called in by the Welsh Government. Responsibility for the national grid and the decision as to whether to build the large power lines on pylons rested with the UK Government.

The whole system was chaos. It was no wonder that, in the end, the company threw up its arms in horror and walked away from the project, having already invested a not insignificant amount of money. Unless the associated consents for devolved electricity generation rest in Wales, the chaos is likely to continue.

I will touch briefly now on the limitation of the level at which Welsh Government approval in relation to electricity is set. The Bill proposes that the Assembly will gain competence over all renewable energy generating projects of up to 350 megawatts in Wales and in Welsh territorial waters. Our concern is that this figure is arbitrary. The Silk commission attempted to provide justification for this limit, but the situation in Wales has moved on considerably since those days. Since the Silk commission looked at the issue, we have seen ambitious projects such as the tidal lagoons progress and proposals for huge tidal lagoons introduced. I know that we are still waiting for the green light—and I will be extremely interested to hear what the strike price will be eventually on this project—but, whether you are a supporter or not, these plans are very far advanced.

In this amendment we suggest that the limit should be increased to 2,000 megawatts. I accept that that is just as arbitrary a figure. Therefore, will the Minister confirm why a level of 350 megawatts was suggested and why we cannot increase it? What is the rationale behind that? If we do not change it now, would there be any scope for us to change it in the future? What would the process for that be? I beg to move.

[Lord Elis-Thomas]

I am grateful to the noble Baroness, Lady Morgan, for moving this amendment. Her description of what happened with the history of substantial onshore wind projects in Wales was absolutely correct. For much of that period I had responsibility as chair of the environment committee of the National Assembly, which produced a substantial report on energy and planning. My difficulty is the difficulty to which she alluded; yet again we are placing a cap on the potential development of natural resources in Wales that does not make sense in terms of energy policy or indeed in terms of the potential for development of natural resources for the future.

There is a separation of generation capacity at different levels. There is the grid, as we have already heard, for the over 400 kilovolt—but there is also the separation of powers in relation to the internal grids provided by the electricity distribution companies. This affects potential smaller generation projects with individuals and small communities whether of hydro power, wind power, turbines, solar power or any other developing form of renewable energy. It means that the potential for development is being stifled because no one is taking a clear view of how these projects could be developed.

Unfortunately for the whole project, the Welsh Government intervention seeking to identify areas for development—mainly on land in public ownership—was not helpful. So for 10 years at least we lost potential capacity for energy generation and also capacity for having a proper grid connection throughout Wales. That is something that we shall have to revisit. I look enviously to Scotland, which has clear guidelines and clear demarcation in terms of the devolution of energy.

I have a particular interest in other forms of low-carbon energy, notably the potential development of small modular nuclear power that could replace the decommissioned nuclear power station at Trawsfynydd in my own part of the world. Currently nuclear power is with the UK Government in totality. But the actual capacity in terms of generation of a single modular power station is probably less than 350 megawatts. Obviously one would look for more than one unit at such a development where you have, as at Trawsfynydd, a full grid connection, land and water availability for coolant and of course a very skilled labour force that has worked in the energy industry. So the Minster needs to look again at the way in which these aspects of the Bill have been set out. In areas of natural resource, it is essential that we look to future capacity and not settle for arbitrary figures on present capacity.

I shall not ask whether the Minister is interested in introducing a protocol for energy policy, but if a protocol for natural resource in relation to water makes sense, it makes even more sense in relation to energy. I have not even mentioned the energy arriving increasingly now in Wales and as part of the Welsh grid from Ireland, where I am assured that the future development of renewable energy both onshore and offshore is likely to continue. That capacity can join the mainland European grid effectively only through Wales. All these aspects need to be considered. I hope that the Minister will be able to give the noble Baroness, Lady Morgan, me and others some optimism as to the potential for future development of this natural resource.