Deregulation Bill

Lord Stevenson of Balmacara Excerpts

Tuesday 28th October 2014 Grand Committee

Moved by

[Lord Stevenson of Balmacara]

7: Clause 13, page 9, line 38, leave out subsection (1)

[Lord Stevenson of Balmacara (Lab)]

My Lords, this amendment probes the changes to Section 10 of the Outer Space Act 1986, which requires people carrying out certain space activities to indemnify the UK Government against claims arising from their activities. The clause makes provision for limiting the amount of the liability, which until now has been unlimited. We accept that for British companies considering projects in outer space, unlimited liability is very difficult to manage in terms of financing. Given the global nature of space work—no pun intended—this could result in work being lost to other countries. Indeed, one could say other universes but perhaps one should not.

We support the intention of Clause 13, which is to cap the liability at €60 million for the majority of space missions and to give the Secretary of State powers to vary this limit by secondary legislation. However, I have three questions for the Minister. Where precisely in the government accounts will the uncapped portion of the liability, which I assume is a contingent liability, be recorded? Under government accounting rules, does this not score against the deficit? If so, how much will that be in a typical year and will the individual amounts be recorded in the notes?

Secondly, the Explanatory Notes state that a minority of space missions will retain an uncapped liability. What criteria will be used to determine whether to cap or not? When the Minister responds, could he give me some more detail on that? If necessary, he may write to me if he does not have the detail to hand.

Thirdly, I note that the regulation of space activity is currently a reserved item, so it is not a matter for the devolved Administrations in Scotland, Wales and Northern Ireland. Therefore, has this issue been offered to the Smith commission as a possible devolution item? I am sure there would be wide support for Scottish space missions being covered by the new financial powers now available to Scotland or those that are likely to be available in the near future. As a rather more technical question, are there any Barnett consequentials? I beg to move.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley) (Con)]

My Lords, I thank the noble Lord for his amendment and his questions. The United Kingdom’s space sector contributes more than £11 billion a year to our economy, with an average annual growth rate of more than 7%. The sector directly employs more than 34,000 people. The Government are committed to the goal of raising the UK share of the projected £400 billion global space market to 10% by 2030, from approximately 6% currently. The proposed amendment to the Outer Space Act 1986 contained in the Bill is one of the measures designed to help us achieve this ambitious target.

The Outer Space Act 1986 is the legal basis for the regulation of activities in outer space carried out by organisations or individuals established in the United Kingdom, its Crown dependencies and certain Overseas Territories. The aim of the Outer Space Act and its licensing regime is to ensure compliance with the United Kingdom’s obligations under international treaties covering the use of outer space. One of these is the liability convention, under which the UK Government are ultimately liable for third-party costs for accidental damage arising from UK space activities. Section 10 of the Outer Space Act 1986 requires licensees to indemnify the Government against liabilities resulting from their space activities. This is an unlimited liability on licensees.

Since it is not possible to insure against unlimited liability, there is a requirement on licensees to obtain third-party liability insurance, usually to a minimum of €60 million for the duration of the licensed activity, with the UK Government a named beneficiary. If a claim were to exceed that amount, the Government could seek to recover the remainder under Section 10 of the Act.

As the noble Lord said, UK space operators have long argued that the unlimited liability placed on them is very difficult to manage in terms of financing. Furthermore, they say that licence conditions relating to insurance place them at a significant disadvantage. Given the global nature of the space industry, this could result in work being lost to countries outside the UK, in particular to countries where operators may not be subject to unlimited liability, such as the USA or France.

The UK Space Agency has reviewed the Act and identified areas where there is room for improvement. In particular, the treatment of contingent liabilities under the Act is now out of date compared with other space-faring nations and other United Kingdom sectors that have comparable contingent liabilities. A public consultation was undertaken and the majority of respondents were positive about the benefits of capping the unlimited liability requirement to €60 million for the majority of missions. The Government therefore decided to undertake a two-part approach to address the industry’s concerns. In the first part, we reduced the insurance requirement from £100 million to €60 million. This was well received by the industry. Clause 13, which we are discussing today, is the second part. It amends the Outer Space Act to cap the unlimited liability. This will be managed through the Outer Space Act licensing regime, as the amendments to the Act provide for the Secretary of State to specify the maximum amount of a licensee’s liability under the indemnity in each licence.

Our initial intention is to set the cap at €60 million for the majority of missions. Clause 13 gives the Secretary of State the power to set or vary this liability limit on a licence-by-licence basis. This will provide the flexibility to ensure that UK space operators remain competitive internationally without the need to undertake further legislative reform. For example, companies are now developing ever-smaller satellites, such as CubeSats. These offer lower-cost, and possibly lower-risk, access to space, and potential growth opportunities for the UK. For non-standard, high-risk missions we would retain the flexibility to increase the liability cap.

The UK Space Agency is currently reviewing its approach to this emerging class of satellite and this amendment will allow the Government to react quickly if a lower liability cap is appropriate for a particular mission, thereby ensuring the UK industry remains competitive. An impact assessment has been completed and the benefit to business is estimated to be in the region of £13.5 million over 15 years. Clause 13 is designed to balance the risks to the Government arising from UK space activity against the need to enable UK industry to exploit the opportunities available to them.

The noble Lord asked how these liabilities would be represented in the national accounts. I think I shall have to write to him about that. The noble Lord also asked what criteria would be used to determine which missions will be within the cap. As I suggested in my answer, there will be a risk-based approach; we feel it is appropriate to retain the flexibility to set the amounts under the amendment on a case-by-case basis.

The noble Lord asked about the devolution position. We are not planning any change in that area. He kindly said that it was a probing amendment. I hope that that will satisfy him and I ask him to withdraw the amendment.

[Lord Stevenson of Balmacara]

I thank the Minister for a very full response and for answering two of the questions. The third one about devolution might bear further examination at some other stage, but I am sure that it is way above our respective pay grades, if there are any. On the other hand, I will look with interest at the letter that deals with the way in which these contingent liabilities—which I think the Minister confirmed they were—are going to be recorded in the accounts and whether they have any impact on the deficit. In the mean time, I beg leave to withdraw the amendment.

Amendment 7 withdrawn.

--- Later in debate ---

There is a lot more to be thought through in terms of the tangible, real social implications of legislation of this sort. It is not just a question of convenience for the shopper; there are all sorts of profound implications for people, not least those working within the industry. When we come to the stage in the proceedings when we vote in the House, I will certainly vote against this, as I think it is unwise. It would be very reassuring to hear in the Government’s response a firm statement that the consensus, which was so carefully built and crafted and which has served the nation so well, will be preserved and that we are not going to start changing things by the back door. In particular, I want to know—and I am sure that that goes for most people in the Committee—whether the words of the Secretary of State are being honoured or repudiated.

[Lord Stevenson of Balmacara]

My Lords, this has been a very good and interesting debate. It proves that we were wrong to bank on knitting yarn deregulation to be the star of today’s show, although I suspect that we might get a little more of a buzz when we get to byways and highways, and the green and black ones and all the varieties we are going to come to in later amendments. It is probably good that we are dealing with a range of issues today, and of course no debate could possibly be topped if it was addressed by the noble Baroness, Lady Trumpington, whose recollections and memories are all so important to us. We should bear them in mind as we think through this issue.

The amendment would change the Sunday Trading Act to allow an exemption for garden centres undefined. We oppose the amendment because we are concerned that there is significant scope for confusion in defining garden centres. A number of businesses could be included because they sell garden products. However, we also oppose it because we think that such a change would amount to an erosion of the law that has stood the test of time since 1994. That could cause confusion and undermine the legislation as a whole. As the right reverend Prelate the Bishop of St Albans said, the main thesis underlying the speech of the proposer of the amendment was the need to revisit and, if possible, deregulate the whole Sunday Trading Act. Repealing that without going through the process of discussion and debate which, as we have heard, was so much a part of the process of building the consensus around the 1994 Act is obviously something that we would have to think about very hard. This issue is about rights. It is about the rights of some people to keep Sunday special and of those who want to do more with their Sundays. We have, in the words of the noble Lord, Lord Rooker, to be careful about this and take our time to make sure that we get the balance right.

It is important that we get the definitions right. A garden centre can be anything from a very small operation selling plants raised locally to a large store within a much bigger department store. Most garden centres are now large operations that include, as we have heard, indoor and outdoor trading spaces, a wide variety of products, outdoor and indoor furniture, kitchenware, giftware, toys and games. It is hard to distinguish between these multifunctional garden centres and do-it-yourself stores that have large gardening departments, or even supermarkets that sell a wide range of plants and garden products in spring—or all year—sometimes in the car park surrounding the store. Without a definition, we do not know what we are talking about. An exemption for garden centres would therefore inevitably open up loopholes in the Sunday Trading Act and, as we have heard, large stores might seek to have themselves defined as garden centres, as some have already done.

As we have heard, the Sunday trading legislation is a compromise, but it is valued by retailers, employees and consumers. It gives people the opportunity to trade, work and shop on a Sunday but at the same time preserves a sense of Sunday being different from other days of the week. The Government have consulted on this issue three times in this Parliament and have found, as many other surveys have, that the laws have the support of the majority of the public—the latest report that I saw found that 77% supported the current laws—and the majority of the grocery retail community, which is a powerful alliance.

The amendment is premised on the view that if shops were to open for longer, it would be a good thing in terms of the so-called growth agenda, but longer opening hours do not mean that consumers have either the funds or the inclination to buy more goods. That was rather proved in the Olympic period when the Sunday trading hours extension, which was agreed by Parliament, coincided with a 0.4% decline in retail sales in that period. Sunday trading laws also currently provide an important advantage to small stores in a market that is heavily weighted in favour of big supermarkets. Indeed, the removal of Sunday trading legislation temporarily during the Olympics resulted, as we have heard, in a displacement of sales from small stores to large stores.

If the current laws were ever to change, they would need far more scrutiny and due process than is possible with this amendment. The existing Sunday trading laws were put in place after extensive consultation and several years of negotiation with interested parties to build the sort of consensus that has remained in place to date. Any wider change would need the same due process. It is clear that scrapping Sunday trading legislation is not pro-growth and will not deliver higher consumer spending. I hope that the Government will give this short shrift.

[Lord De Mauley]

My Lords, my noble friend’s amendment would relax restrictions on garden centres by adding them to the list of retailers exempted from the Sunday trading regulations. At present, they can already open for six continuous hours between 10 am and 6 pm. When my wife told me that she wanted a wheelbarrow on Sunday, despite the burdens of office, I was able to acquire one at my local garden centre within that six-hour window and attend church on Sunday morning. This measure would mean that garden centres could open at any time on a Sunday and open on Easter Sunday, from which they are currently prohibited.

Having thought about this carefully, the Government believe, in line with the noble Lord, Lord Rooker, the right reverend Prelate and my noble friend Lady Trumpington, among others—although I could not have put it as eloquently as they did— that the current Sunday trading laws represent a reasonable balance between those who wish to see more opportunity to shop in and sell from large shops on a Sunday, and those who would like to see further restrictions.

Those advancing the case for further liberalisation of the Sunday trading laws claim that there will be worthwhile economic benefits, including an increase in revenue for garden centres. However, as a matter of interest, the evidence to date is not entirely compelling. The ONS’s assessment of the liberalisation during the Olympics found no significant growth associated with the longer opening hours during the event. Instead, sales tended to be spread out further over the additional opening hours. Likewise, with this proposed liberalisation, customers may not end up spending more but merely spreading their spending over a longer period.

As my noble friend Lord Skelmersdale mentioned, the industry has talked of a potential £75 million increase in revenue but no details on the increased costs of extended opening have so far been forthcoming. As I have just mentioned, we do, however, have the useful example of the measures taken during the London Olympics. The Government suspended the Sunday trading laws during the Olympics in 2012 so that retailers could take advantage of the unique opportunity that the Games presented. The suspension of the law applied only to the specified period, from 22 July to 9 September 2012. There was an increase in footfall in London but this may merely have reflected increased visitor numbers to the country. An evaluation of the suspension of hours during the Olympics found that the overall sales increases seem to have been modest for large retailers, but that there was in fact a loss of business for the smaller retailers.

--- Later in debate ---

[The Earl of Clancarty (CB)]

My Lords, I have tabled this amendment because the responsibility that the Government have had for 160 years in giving consent for the erection of public statues in London should not pass away unremarked. Also, perhaps more importantly, there has to be a concern about where the responsibility for all public sculpture in London, not just public statues, should ultimately live. The area of London in question is Greater London but excludes the City of London and Inner and Middle Temples, as the very helpful notes to the Bill indicate.

There is a case for handing over ultimate responsibility for all public sculpture, not just statues and not just new sculpture, to the GLA. The timing of this amendment is interesting in the light of the think tank Centre for London’s call for greater devolution for the GLA, including, I understand, the ownership of public land. There is also a case for treating all public sculpture equally, at least administratively, which, with the change that the Government are making here, we are part-way towards doing.

I say this because I believe it is the specific environment, the place itself, that should be the starting point and of paramount concern. If the environment demands that there should be a sculpture sited in that place, the question should be asked: what kind of sculpture should it be? Should it be a memorialising sculpture or something else? However, we tend instinctively to do things the other way round. There is a national clamour to memorialise such and such a person, and then sometimes an unholy compromise arises in terms of the use of public space.

My first question to the Minister is why the Government are retaining the 1854 Act at all if they are removing the key responsibility for consent for public statues. Yes, I believe that these decisions should be taken with the locality permanently in mind, but I am not at all convinced that the ultimate responsibility for decision-making for new public sculpture in London should reside with the local authorities. Public sculpture generally should be under the stewardship—I stress, the stewardship—of London. New public sculpture in London is foremost a city-wide issue, of primary concern to London and Londoners.

With regard to my amendment, which is really a first stage in my train of thought on the subject, I do not for one moment believe that any current mayor should be making personal decisions about these things. I would have strongly disagreed with any suggestion that Generals Havelock and Napier ought to be removed from Trafalgar Square. Public sculpture should be removed or relocated only under exceptional planning considerations because to do otherwise, for aesthetic reasons or reasons of political correctness, is to excise history and that is wrong.

However, considering the future, I would be very happy—I think that others would agree—if there were a 20-year moratorium put on all new sculptures memorialising the military, the royals and politicians. Our culture is considerably wider than that. Last week, a fellow Peer suggested to me that there should be an independent decision-making body of experts. There is merit in that; in Berlin, for example, I understand that there is a citywide system of open competition for all new sculpture under the auspices of Berlin’s association of visual artists. Comparisons can be made here with the manner in which the very successful fourth plinth project is administered, whereby decision-making is down to an independent group of judges yet the project itself is under the stewardship of the mayor.

My second question is: might the Minister promise to find out whether, over the years, there has not developed a substantial archive reflecting the Government’s involvement with public statues in London? Westminster City Council, for example, confirms in its guidance on public statues and monuments that it currently submits detailed plans and drawings to the Government. Has an archive built up and is it publicly accessible? If so, as it would be of great interest to the public and historians, what do they plan to do with it?

We often take public sculpture in London for granted but when people from this country or from abroad visit London for the first time, the very first things they want to see include Nelson’s column or the Shaftesbury memorial fountain at Piccadilly Circus. Public sculpture is part of the face of London and says important things about our history and cultural identity. It is perhaps too important to be left only to local planning departments and it is fitting that the GLA should take more of a role in this area. I beg to move.

[Lord Stevenson of Balmacara]

My Lords, I am grateful to the noble Earl, Lord Clancarty, for raising this issue. He makes a good case for this matter to be given more consideration. We are in debt to previous generations—he ended on this—for the substantial collection of public statues that there is in London. According to Westminster City Council’s guide to its process for obtaining permission for statues, they date from the Charles I statue of 1633. I had a look at that the other day and it is in very good nick. We are still seeing modern examples of material being put up and, as the noble Earl says, there are huge impacts on the way in which we view our city, on tourism and in other aspects, so it is important.

Behind the individual questions that the noble Earl has posed for the Government I think there is a real worry about their attempts to deregulate here. While the Government are clearly achieving something by taking responsibility away from the Secretary of State—although that is a deregulatory measure on a Minister and not on business—I am not sure whether they are taking the right step. As the noble Earl mentioned, there is a gap regarding who has responsibilities in this area. Given her previous experience, our Deputy Chairman, the noble Baroness, Lady Andrews, might be in a better position to answer some of the questions about whether English Heritage has a role to play in this. I am sure that she will be too discreet to mention anything at this stage, and certainly not from the chair. However, I am sure that she will have some ideas about that. I am also sure that the Arts Council, in its wisdom and knowledge of these matters, will have things that might be brought to bear.

Whatever those ideas are, it is wrong for any individual politician to take responsibility for this area. That point was well made. I am not entirely clear whether substituting the GLA for the City of Westminster would solve that problem, because we are still talking about political control, but it raises the question: “Why just Westminster?”. Why would we not have wider consideration about where statues might be placed in London as a whole? My feeling is that statues are too important to be deregulated simply by the measure proposed by the Bill. I am not sure what the right solution is but I wonder whether the Minister might think about having a little more discussion about this.

The reflection I have, which I think is shared by the noble Earl whose amendment this is, is that there will be a bit of a gap here. It is not just a planning issue. The issues around putting up any memorialising form, whether it is a physical representation of somebody or an object whose presence is intangible, require aesthetic and other considerations rather than simply being about planning. I am not sure whether the planning system is quite the right place for this to be left. If there is therefore a gap, how would we find a way around it? It may be by having a statutory committee of some kind or simply by inviting some other body to take on a responsibility, which might be advisory. Whatever it is, I share the noble Earl’s concern about this issue.

[Lord De Mauley]

My Lords, the purpose of Clause 28 is to remove the current requirement on persons seeking to erect statues in public places in Greater London, excluding the City of London and the Inner and Middle Temples, to obtain consent from the Secretary of State before doing do. Controls to prevent the unsightly proliferation of statues in Greater London are already provided for by the Town and Country Planning Act 1990. This requires that planning permission be obtained from the relevant local planning authority prior to the erection of a statue in a public place in Greater London or the remainder of the country. I am not sure that I entirely agree with the noble Lord, Lord Stevenson, but I am sure we can have a useful discussion about it. Given that the aim of this change in Clause 28 is to streamline the current double-handling of applications to erect statues, I cannot really see a benefit in removing the requirement to seek the consent of the Secretary of State only to replace it with a requirement to seek the consent of the Mayor of London.

The mayor plays a key role in the planning for London’s continued success. His London Plan provides the economic, environmental, transport and social framework for development in the region to 2031. He ensures that local plans fit with the London Plan, works with boroughs to develop planning frameworks for major areas of brownfield land and considers planning proposals of strategic importance. In this way, he already has input to the preparation of policies relating to public statues, such as those produced by the City of Westminster. The noble Earl asked why keep the 1854 Act at all? It is worth saying that it provides a power for the Secretary of State to repair and restore, for example, any public statue. I might be so bold as to suggest we would all find that an important power to retain. He also asked whether there are archives. I do not believe there are such archives—I am happy to have a rootle around but I am pretty sure there are no centrally held archives. I have little more to add. I hope I have said enough to persuade him to withdraw his amendment.