Queen’s Speech

Lord Jenkin of Roding Excerpts

Thursday 5th June 2014 Lords Chamber

[Lord Jenkin of Roding (Con)]

My Lords, it is a particular pleasure for me to congratulate the right reverend Prelate the Bishop of Rochester on, if I may say so, a very attractive and persuasive maiden speech. Housing is certainly a very important issue, as a number of speakers on all sides of the debate have made clear today. The right reverend Prelate, as he explained, brings very special knowledge and experience in that regard to our debates, and we will very much welcome that.

He has also talked about his work in prisons. That is an enormously important area for the work of the churches, in order to help the prisoners when they come to be released back into the community and hope for their redemption. He did not mention one of his interests, which is urban regeneration. I spent some years at the Department of the Environment dealing with those problems, and I have no doubt that the right reverend Prelate will bring much wisdom to our debates.

I have to tell the House that the right reverend Prelate is very keen on choral singing. As a founder member of the Parliament Choir, I hope he may be persuaded—although I think it somewhat unlikely—to attend the weekly rehearsals and sing in one of the choir’s performances. Perhaps that is asking too much.

It is a particular pleasure to me to be able to welcome the right reverend Prelate’s maiden speech as I have a brother and a son who are in the church and I draw considerable benefit from their advice, as the right reverend Prelate the Bishop of Leicester well knows from what has been said in recent years. I say to the right reverend Prelate the Bishop of Rochester that we all very much look forward to the contributions he will make to our debates in the future.

A number of speakers have already touched on the Infrastructure Bill, and I join my noble friend Lord MacGregor in congratulating my noble friend Lord Deighton on his speech and on what he had to say about that subject. We all await the development of the very exciting proposals which he outlined to the House.

On the subject of energy, there will be not only the infrastructure proposals directly. As the gracious Speech noted, we are going to see measures to implement the electricity reforms which were legislated in the previous Session under the Energy Act 2013. Rather unusually, the gracious Speech referred to what in practice will amount to delegated legislation which is involving much activity by DECC. I had a Question down two days before Prorogation and miraculously it was answered by the Minister before we prorogued. I was very pleased about that. My noble friend Lady Verma outlined the programme for the EMR secondary legislation:

“It is the Government’s intention that these regulations will be laid before the House at the beginning of June 2014 and published concurrently”.—[Official Report, 14/5/14; col. WA508.]

Well, time has slipped, as I learnt yesterday that it is now going to be towards the end of June. I hope that is not a harbinger of other delays in future. There will also be a number of responses to consultations that have been issued over recent months, and it is quite clear that the department has a great deal to do. It means that this House will also have a lot to do in dealing with that delegated legislation.

Among the issues which we will be considering is another matter that is left over and about which the Minister has not had a reply. It is the application to the European Commission for state aid approval for the various measures in the electricity market reforms. The first being considered in detail at the moment is the application for the nuclear power station at Hinkley Point in Somerset. Those of us who took part in the debates on the Energy Bill were encouraged to write to the Commission and express our support for the application in the hope that the Commission would approve it. I duly wrote and stressed that the Government’s electricity market reforms are vital to allow essential investment in new low-carbon generation of all types to come forward. One does not often get acknowledgements from government departments, but I had a very handsome formal acknowledgement from the Commission and I have no doubt that others who wrote in did as well. I made it clear, and it is certainly true, that EDF and its partner firms need clear and timely approval from the Commission that the arrangements that have been agreed with the Government and are now the subject of legislation are compatible with the state aid rules. The Competition Directorate has completed its consultation, and we have been assured by Commissioner Almunia that he intends to decide the case during his term of office, which ends later this year. There must be no delays to this progress. Our margins are getting very slender, and although the nuclear power station will not be operative until the early 2020s, other investment will need to go forward and we need the approvals to enable that to happen.

In particular, I want to mention the capacity market. The measure in the Act is the framework intended to ensure that we have investment in electricity generating capacity, particularly to help to keep the lights on when the wind does not blow. Regulations, which are awaited with keen interest, have been the subject of fierce negotiation between the industry and DECC. It is now looking as if what comes forward will meet most of the representations that have been made by potential investors. Last month, I had a very helpful letter from the Minister for Energy, my right honourable friend Michael Fallon, in which he spelled out the measures that are likely to be in these regulations. This House will want to look at them very carefully when they are issued to make sure that they achieve what is required.

The capacity market also has to be approved by the EU Commission and is the subject of a separate application under the state aid rules. It has been difficult to find out where the application has got to, but yesterday I had an answer from my noble friend. In advance of her letter, her office very kindly answered my question about the process and timing of that state aid approval and stated:

“We have engaged with the Commission since the start of the policy development process and continue to do so. Discussions with the Commission are at an advanced stage and the Commission is fully aware of our deadlines. At present, we do not foresee any delay and our plans for the first auction in December remain on track ... A delay is not currently anticipated”.

We shall want to watch this very carefully. There have been huge delays in the investment programmes so far, and we cannot afford any more. We are facing very narrow margins over the next two or three years, and this urgent gas-fired investment will be essential to keep the lights on.

The gracious Speech foreshadowed the Infrastructure Bill, which had its First Reading this morning. As my noble friend Lord MacGregor made clear, it includes measures to ease the path for the development of shale gas and oil and geothermal energy. It is interesting that the consultation paper that has been issued covers both almost in parallel because they raise exactly the same issue of deep drilling. Shale gas involves horizontal drilling, which is part of the technology. A lot is known about this because of the consultation paper that has been issued. There has been quite a lot of consultation with stakeholders in recent months. I agree with my noble friend Lord MacGregor that this implements the recommendation that came from his Economic Affairs Committee. Like him, I hope we shall have a response to that very soon so that we can debate in the House that hugely important report. Suffice it to say that the report sets out in detail the very great economic benefit that will accrue to this country from the successful exploitation of this energy source. Of course it must be safe, and of course the environment must be protected, but the evidence that was given to that committee shows that, in fact, that is all entirely possible.

Why do we need this new provision? When I was reading law at university more years ago than I care to remember, I was taught that the common law of England provided that the ownership of land—I shall eschew the Latin, because I know it is out of order—roughly translated, carries ownership of the space up to the heavens and down to Hades. Of course, the minerals below that have long since been nationalised and therefore do not belong to the landowner, unlike in America where they still do. The right to use the space is still that of the owners. Below 300 metres—the figure in the consultation paper—it really can be of absolutely no practical use to the landowner at all. Yet some of the opponents of fracking have threatened to buy strips of land all around so that they can stop the exploitation of shale gas simply by saying, “Sorry, you cannot go through our land”. The Government have made it clear that this is of huge importance to the economy of this country and in helping Europe as a whole to become less dependent on imported sources of gas. I will warmly support the proposal in this Bill.

However, there seems to be a question of timing. The consultation was launched last month and is not due to end until August, in the long recess. Are we really going to debate this Bill and the clauses in it without knowing whether it will in fact be approved by the Government and without having seen the Government’s response to the report? I find this quite difficult. It would be helpful if something could be said about that when the Minister winds up.

It was suggested at one point that this Parliament would have very little to do in its last Session. However, as my noble friend Lord Razzall and others have said, that simply is not true. We are going to be extremely busy, and I warmly welcome the gracious Speech.