Nuclear Safeguards Bill

Lord Teverson Excerpts

2nd reading (Hansard): House of Lords
Wednesday 7th February 2018 Lords Chamber

[Lord Teverson (LD)]

My Lords, I thank the Minister, particularly for his explanation at the beginning, not least that the Nuclear Safeguards Bill is not about safety but about security. I look forward to the Government’s nuclear security Bill, which will look after safety in due course—the whole of this area is perhaps a little confusing.

On the intervention made by the noble Lord, Lord Warner, I am relatively relaxed about the Bill and the transfer of medical isotopes. However, he pinpoints the right issue with the Bill, which is that out of Euratom we are then out of the observatory, which is there for emergencies when supplies of these difficult commodities are short. That itself is probably a key area as regards the Euratom aspect.

I welcome a number of things from the Government on the Bill. The Government, unlike with the shambles of the EU negotiation, are getting on with it, and I give them credit for that. In comparison with the other negotiating stream, they are positively better. I also welcome the Minister’s undertaking in his opening remarks that we would go not for IAEA standards but for the continuity of Euratom standards. That is an important point—if only we had that guarantee of alignment elsewhere, perhaps in the negotiations. I also welcome, as did the noble Baroness, Lady Neville-Rolfe, the advance publication of the draft regulations. Therefore, it is good from all those points of view.

As my noble friend Lord Fox mentioned, the Euratom treaty and organisation is around research projects. I was privileged to visit Culham a couple of weeks ago with the other members of the EU Energy and Environment Sub-Committee that I have the privilege to chair. It is important that the work that is going on there—the co-operation, future planning and the promise that we hopefully have from the project as it moves on to ITER, into France and then on to a demonstration project—is here in the United Kingdom and co-operates on research projects as part of Euratom.

The Euratom treaty is also around the movement of materials, which I will come back to later on, and, as my noble friend Lord Fox said, around freedom of movement for individuals. When we remove ourselves from the Euratom treaty, we will then stop those freedoms that come with the treaty, and I very much hope that the Home Office will take note of the fact that we need to have that freedom of movement for nuclear experience to continue. That is not just about the most professionally advanced people but about people at all levels. For instance, I know that one area that EDF has been particularly concerned about at Hinkley Point is steel fixers, as the lack of that key skill could stop that project going ahead. So it is not just the PhDs and the nuclear fusion research; we need to keep that freedom of movement right the way through the nuclear chain.

However, the thing that really concerns me, which has been mentioned by other noble Lords, is timing. The deputy director of the Office for Nuclear Regulation has already been quoted a number of times. I find it very difficult indeed, from both her evidence and that of others, to see that we can have an approved organisation—the technical term for what we need is a voluntary offer agreement—with the IAEA by the time we leave Euratom on 29 March next year. It seems that there is a high risk that we will not meet that. That has a number of implications for our international relations. It particularly means that, if that is not the case, we will be unable to fulfil our obligations under international treaties and the legislation of other countries with which we deal.

If the Minister answers one question I ask today, this is the one I would most like him to answer. Let us suppose that we get to 29 March next year and do not have the voluntary offer agreement with the International Atomic Energy Agency. If we manage to get an agreement with Euratom that we can subcontract and still work those safeguarding arrangements through Euratom, will the IAEA agree to that? I would be interested to understand from the Minister whether we have an agreement with the IAEA on that, because it seems fundamental.

We cannot guarantee that we will have that agreement with Euratom, however. Why? Again, I share the view of the noble Baroness, Lady Neville-Rolfe, about extending our membership of Euratom instead of having a transitional agreement; it would make everything so much easier. The referendum did not cover Euratom, so politically it is not an issue. It is not a given, however; the situation could be more sensitive than we might think, because Germany and Austria are often difficult about the Euratom treaty in areas including future agreements.

Finally, on nuclear co-operation agreements, I went through the Commission’s website earlier today to see how many such agreements Euratom had to which we were privileged to be party. The list covers Australia, the Russian Federation, Japan, Canada, the United States of America, Switzerland, South Korea—strangely, it was described as the Korean peninsula—Argentina, South Africa, Kazakhstan, Ukraine and, of course, the International Atomic Energy Agency itself. To continue the 20% of generation that we already have and complete the construction of Hinkley Point and the remainder of a new nuclear programme if we have it, we need to replace significant numbers of those nuclear co-operation agreements very quickly, before we actually leave the Euratom treaty. That seems an extremely tall order, and I would be interested to hear from the Minister exactly how we intend to achieve it.

Nuclear Safeguards Bill

Lord Teverson Excerpts

Committee: 1st sitting (Hansard): House of Lords
Thursday 22nd February 2018 Lords Chamber

[Viscount Trenchard (Con)]

My Lords, I shall refer to the amendments tabled by the noble Baroness, Lady Featherstone, and the noble Lord, Lord Warner. The noble Baroness would like us to remain a full member of Euratom but, failing that, her amendment seeks to ensure that, as far as possible, we become an associate member of Euratom on exactly the same basis as we are a member. It seems to me that in that case we might as well remain a member. However, given that the treaties seem to be so mixed up with those of the EU, I understand that the Government are in receipt of legal advice that that is not a possible option.

However, it is not accurate to say that our continued associate membership of Euratom is essential for us to adopt and have approved by our nuclear partners a proper accredited safeguards regime. An accredited nuclear safeguards regime does not depend on meeting Euratom standards, it depends on meeting standards set by the IAEA. Euratom standards are thought to be less robust on process, procedures and controls than those set by the IAEA, which concentrate more heavily on verification processes, which is one reason why you need so many inspectors.

[Lord Teverson (LD)]

I thank the noble Viscount for letting me intervene, but I honestly do not understand that. If Euratom procedures were not up to IAEA standards, it would not be approved as a safeguarding authority by the International Atomic Energy Agency itself.

[Viscount Trenchard]

Euratom is certainly approved by the IAEA as having adequate standards. My point is that Euratom has standards that go beyond the level required by other international nuclear partners, including Japan, the United States and Australia. My point is that it is therefore not necessary to comply with Euratom standards to comply fully with the safeguards regime—

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[Viscount Trenchard]

My Lords, I am not sufficiently aware of the detail of the proportions of different types of isotopes that come from the European Union—the Netherlands, France and Germany—but the 60% from the EU comes mainly through the Channel Tunnel, as I understand. The 40% from non-EU countries, comes through Heathrow in the main and is subject to the fast-track customs clearance procedure. That is absolutely necessary given the 66-hour half-life that applies to quite a proportion of these isotopes.

[Lord Teverson]

My Lords, I think we should allow the noble Viscount to sit down, and remind ourselves that he is not the Minister. To go back to something that the noble Lord, Lord Warner, said, in a way, none of the amendments in this group is perfect. Why are they not perfect? It is because we have given our notice to withdraw from Euratom, yet we all know that that was not the greatest thing to do. So we are now trying to claw our way back to the status quo, having given notification under Article 106a of the Euratom treaty. We are trying to find a way to get back to where we want to be, but we are not allowed to withdraw our notification under the treaty. We certainly cannot within the scope of this Bill, but perhaps under the EU withdrawal Bill there is more scope. Who knows? It does not seem so long ago that we were debating that.

I presume the Minister will confirm that we do want to achieve Euratom standards, not bargain-basement, superstore value in terms of just the IAEA standards, although those are important. Can the Minister confirm that a transitional agreement is possible and would work, and that the EU 27 are up for this? Certainly in the publication on transitional arrangements, which was published last month, Euratom is a footnote on a couple of occasions, so I presume that it is in the mix in terms of the continuing acquis during the transition period.

What concerns me most about this is the need—as the noble Viscount has said, and he is quite right—to avoid this rather more precipitous cliff edge than there is even in the other areas of transitional commercial arrangements. When the break from the treaty happens, are we certain that the International Atomic Energy Agency would be prepared to have Euratom act as our safeguarding authority during a transitional period even though we are not legally a member of Euratom? That is a fundamental question. An answer would provide a lot more clarity and perhaps enable us to come back on Report with a suitable amendment which might actually work. We are not in a position to do that at the moment because we do not have that information.

[Lord Carlile of Berriew (CB)]

My Lords, after the excellent introduction by the noble Baroness, Lady Featherstone, and the excellent speech by the noble Lord, Lord Warner, I listened with great attention to what was said by the noble Viscount. My conclusion, after he sat down, was that I should take a deep breath, count to three and then try to analyse where we are up to in this debate. My conclusions are: first, we have at the moment a very satisfactory set of standards; secondly, what we are offered as an alternative is a set of good intentions. We know about good intentions; they do not always lead to good standards, or even any standards being adopted at all. I say to the Minister that what persuades those of us who are taking part in this important debate, and who took part in yesterday’s analogous debates, is real anxiety about the standards this country will have in the future, and about whether we will be recognised as coming up to world standards in relation to nuclear safeguards. It was partly with that in mind that I went to look at the EU exit analysis papers at 100 Parliament Street the day before yesterday, which were referred to extensively in the night shift before we signed up to today’s morning shift. I looked in those papers for a single sentence or word about the future of nuclear safety and Euratom. I was only there for three-quarters of an hour so I only had time to read the documents twice, but I do not recall, and did not note, a single word on this issue. It worries me that it was not there because this is a key issue that should have been addressed in the advice given to Ministers, which is what those papers really are.

Therefore, I repeat a question I asked of the Minister’s colleague last night: how many meetings have so far taken place on this issue with European negotiating counterparts? Can we be given a number please? Next question: how many meetings of that kind have taken place on this issue with counterparts in the IAEA? Please can we have numbers because they will give us at least an indication of how far down the road we are towards turning the good intentions into a set of future standards? I am not wholly opposed to leaving Euratom: we may be able to do at least as well or better under other arrangements, but we have to do at least as well or better, otherwise we will serve the country ill.

Nuclear Safeguards Bill

Lord Teverson Excerpts

Committee: 1st sitting (Hansard - continued): House of Lords
Thursday 22nd February 2018 Lords Chamber

[Lord Rooker (Lab)]

My Lords, the amendment can only be delivered by people, and it is the issue of people that I want to raise with the Minister, because I think that his letter is in fact quite worrying. I first go back to the evidence taken by the Lords EU Energy and Environment Sub-Committee on energy security on 13 September. We had two groups of witnesses, and the second group was essentially on Euratom, with witnesses from the Institution of Mechanical Engineers and EDF—which of course runs most of the nuclear power stations and is building one—and Dr Golshan, the deputy chief inspector at the Office for Nuclear Regulation.

Having been asked how we were going to be able to deliver what is needed by the IAEA, Dr Golshan, in answer to Question 37 asked by the noble Viscount, Lord Hanworth, said:

“I started off by saying that we are building capability and capacity and we are recruiting experts in the safeguards area … the extent to which we can equip ourselves depends on the scope of the safeguards arrangements that the Government are working towards. That, in turn, depends on the outcome of the negotiations with both IAEA and Euratom. We are working towards having a regime in place that enables the UK to fulfil its international reporting obligations to the IAEA and to meet the reporting requirements of our nuclear co-operation agreements. We see that as a much more realistic starting point that we can build upon and build in additional layers of assurance as currently provided by Euratom”.


That was basically telling us, “We are not going to deliver”. That is what that means. Dr Golshan concluded her answer to that question:

“To seek to replicate Euratom standards arrangements by the end of March 2019 will be highly challenging and, while we would work towards that, we want a starting point that allows the UK to meet its obligations”.


Later on, in answering another question, Dr Golshan said:

“We currently have 10 staff in our safeguards function. I should not call it an inspectorate. We need another 12 to get to a level where we are able to provide the required reporting arrangements. If additional assurance layers are required we will need to staff to a higher level. Currently what we have, as I said, is based on the fact that we have been a member state of Euratom”.


She went on to alert us to what would need to be put in place to meet the roles and responsibilities that will be placed on the ONR. In answering a question from the chairman, the noble Lord, Lord Teverson, she said:

“The first one is to have an IT system that allows us to collect and process data and then provide a report to the IAEA”.


I have seen nothing about that because clearly a new IT system is required. Dr Golshan continued:

“That means the UK would meet its international obligations as part of the non-proliferation treaty. The second element is that we should be able to facilitate IAEA’s activities in the UK. The third element is that we should have suitably experienced staff to undertake verification activities”.


In a later question, Dr Golshan was asked about the staff and she said:

“The biggest risk that I see is our ability to recruit”.


Of course, there has been free movement while we have been in Euratom and recruitment has not been a problem. Not everybody that is needed in the nuclear industry fulfils the Home Office requirement for getting into the country. We are not going to be able to build Hinkley, for a start, because we cannot get the steel erectors into the country. We need half the country’s steel erectors on Hinkley at one point. We will not be able to get them in. They are not qualified in terms that allow the Home Office to let them in.

I am sticking to the point of what will happen about the staff because we were then told in the report, which was published only a few weeks ago, that the training programme to train people to become fully trained new inspectors lasted between 12 and 24 months. Therefore, my first question is: why have six months been lopped off that figure in the Minister’s letter? What has happened to change that timescale between now and when the committee received the evidence? Have more resources been put in? Have the criteria changed? That is quite a big change, bearing in mind the timescales we are working to. We do not have a lot of time. In addition to the training lasting from 12 to 24 months, the committee was told that we need more staff anyway because the existing staff are not inspectors. The Minister’s letter flags that up and refers to 11 safeguards officers, all of whom will undertake training to become inspectors by March. The Minister then chose to put the next sentence in bold type. I assume that that was his choice to reinforce his assessment that the ONR will be in a position to deliver the international standards. The international standards mean lower standards than we have now. That is the assumption because they are not the Euratom standards.

The Minister went on to say that the ONR will require a team of 30 to 35 people, which was implied in the answer given by Dr Golshan that I cited earlier when she said that the ONR would need more staff. The ONR is recruiting but the fact of the matter is that a far more interesting choice of jobs in this industry is available in the rest of Europe than in the United Kingdom, notwithstanding the fact that I understand that a quarter of Euratom’s inspections take place in the UK, so there is quite a big capacity there. But, of course, we have not been doing that. We did not need to recruit or train people because we are members of Euratom.

The Minister went on to tell us that since the evidence was taken back in September and October—the report says the end of October—the ONR has managed to recruit the princely sum of four individuals. Where did they come from? I would like to know. Are they from the UK? Some 98% of its staff were from the UK or had dual nationality when the evidence was given. Where did the four come from? Why is it only four? If this matter is being dealt with urgently does that figure reflect salary levels or other matters relating to the job such as promotion prospects or seniority? Can the training programme cope with upskilling the safeguards officers to become safeguards inspectors?

The issue here concerns the staff but the Minister’s letter did not really address that issue. First, we are told there are only four. That is not enough. They cannot be trained in time, and in the Minister’s letter someone has lopped six months off the period given to the Lords Select Committee. Why is that? There must be a reason for it. I presume that someone reads the evidence given to your Lordships’ Select Committees from representatives of industry and other sectors. I would like to know the answers to those questions because if there is confusion about the number of staff, their training and recruitment at this point in time, we are heading for real trouble. That is clearly the case. Therefore, I hope the Minister has come to this debate prepared. I know that we are in Committee, so I apologise for the detail of my questions, but that is what this stage is for. We need some answers on this issue before we move on to the next stage.

[Lord Teverson (LD)]

My Lords, I thank the noble Lord, Lord Rooker, for having gone through all that. That session of the committee which I chair was an eye-opener. That is why I tabled my Amendment 10, which we will consider in the next sitting of the Committee. The amendment is about labour mobility, which is an absolutely key factor in terms of not just safeguarding but the nuclear industry as a whole. I look forward to continuing that debate on that occasion and very much agree with the comments of the noble Lord, Lord Rooker.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)]

My Lords, I hope that I can respond to and deal with the various points that have been made. I am very grateful for all the contributions that have been made, particularly from my former noble friend, the noble Baroness, Lady Featherstone, who stressed that she wanted reassurances. I think that was the gist of what the noble Lord, Lord Rooker, said as well. He was seeking reassurances on when the ONR would be ready and whether we would meet the appropriate standards under the IAEA and so on.

I will refer back to the letter that I sent to all noble Lords, to which the noble Lord referred, and remind them of that. I also remind the Committee that we have committed to a domestic nuclear safeguards regime that is equivalent in effectiveness and coverage to that currently provided by Euratom. That is the commitment that we have made and I repeat it to the noble Lord, Lord Grantchester. That means a level of inspections and other regulatory arrangements—it is not just inspections—that goes beyond the normal international standards as applied by the IAEA that would be expected from the United Kingdom: for example, additional assurance and verification activities at additional facilities.

It is crucial that we meet all those international standards following our withdrawal from Euratom. Compliance enables the United Kingdom to discharge international commitments and would also underpin international nuclear trade arrangements with key partners such as the US, Canada, Japan and Australia. It is right therefore that the ONR focuses its efforts on ensuring that the United Kingdom is able to meet those standards immediately on withdrawal from Euratom and seeks to move to Euratom standards as soon as possible thereafter. The important thing is that we get to the IAEA—I hope I have got the letters in the right order; it is difficult to remember sometimes—as soon as possible thereafter.

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[Lord Henley]

I am answering the question but the noble Lord is enjoying himself. The ONR is recruiting and will make sure that it has the right people to provide the appropriate safeguards regime on 29 March next year to meet IAEA standards. Obviously we are not going to impose restrictions on where employees go thereafter. Is this a new policy being developed by the party opposite, that once people are trained in any job, they cannot move on and have to stay? These people will be employed by the ONR, and it is then a matter for the ONR to make sure that they have an attractive career and wish to continue working for the ONR. I am sure they will find that it is an attractive career and will want to stay

I am equally sure that they will do the job very effectively and that the ONR will feel confident that, with its recruitment processes, it can provide the appropriate safeguarding regime to make sure that we meet IAEA standards by 29 March next year.

[Lord Teverson]

My Lords, I think it was the noble Lord, Lord Grantchester, who mentioned the requirement for information technology systems, which is always the other area that needs to be looked at. When we get to my amendment in the next Committee sitting, I will certainly come back on the points that the noble Lord, Lord Rooker, raised about churn, as that is important. However, are we also confident that we will have information technology systems in place? What nature will they take, in a very broad sense? Will they be Excel spreadsheets or something more involved?

[Noble Lords]

Oh!

[Lord Teverson]

It is amazing what you can do with Excel spreadsheets, and I suspect that most systems are based on something like that. I would be reassured if that were the case, but if it is rather more sophisticated, I start to get concerned.

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[Lord Carlile of Berriew (CB)]

My Lords, I would like to speak to Amendments 14 and 15 tabled in my name, and in particular to the proposed new clause set out in Amendment 14. I would never insult the Minister by accusing him of being overly sensitive; nevertheless, he will have realised that there is a great deal of genuine concern about what is going to be delivered in relation to Euratom on 29 March 2019. I support what the noble Lord, Lord Warner, just said, which was in the same vein.

My suggested new clause would require the Government to answer certain criteria by that date. The criteria are set out clearly and they have been shown, in the debates on this Bill and on the withdrawal Bill yesterday, to be the ones that cause concern around the House and which the Minister has heard repeated time and again. In debating terms, this has basically been a one-horse race in relation to concern about Euratom.

Yesterday—and I will not repeat them—I cited some answers that had helpfully been supplied by the Minister to questions raised by the Society for Radiological Protection and by me as a result of that society’s representations. What was clear from those answers was that the Government do not know what will be delivered or when. This afternoon, I will cite another piece of evidence that draws the same conclusions. On 12 February, just over a week ago, there was a meeting between 10 officials—nine from the Department for Business, Energy and Industrial Strategy, one from Public Health England and the two senior relevant officers of the Society for Radiological Protection. I have in my hand a record of that meeting, which I feel sure is accurate.

In that meeting, there was what was described as a “Euratom exit update”. One of the officials, who was clearly a senior and responsible official—it is invidious to name officials, so I will not name him or her—noted that the Nuclear Safeguards Bill is currently going through the House of Lords. The official noted that,

“at current there has been minimal industry engagement, due to the short timescales to pass the bill. However”—

the official—

“did note that the bill is a skeleton, and more detailed consultation with industry and professional bodies would take place as the regulations are developed”.

All I am asking for, in my new clause suggested in Amendment 14, is the key to the skeleton or the cupboard where the skeleton is kept.

The official noted that,

“discussions are going well internationally”,

which is very welcome,

“with progress being made on bi-lateral agreements with the US, Australia, Canada and Japan”.

We would certainly like to know more about that. The official then explained—and this is very important—that,

“as part of the EU exit process they”—

the 10 officials—

“are unable to pursue agreements with the various EU countries”—

I think “pursue” means seek—

“till the exit process is complete”.

If that is right, it is extremely worrying. I am sure that the Minister can be supplied with a copy of the minutes of that meeting.

It was also noted that,

“there have been wider EU civil nuclear issues around legal ownership of fissile material and radioactive waste”.

Contained in that single sentence is a host of problems that will have to be unravelled in great detail if there is to be proper nuclear safeguarding.

Having read those notes, with the welcome support of the noble Lord, Lord Fox, I tabled Amendment 14. It requires the Secretary of State to publish a report setting out the answers to all these questions before 29 March 2019. It requires the making of,

“regulations providing for the implementation of any agreements covered”,

by the clause and a statutory instrument which should be approved by each House of Parliament.

There is an evidence base for the kind of quality assurance that any responsible Government would demand of any contractor to which they were letting a contract. As a Parliament, we are entitled to demand, respectfully but necessarily, a similar level of quality control for the Government before we lose the legislative opportunities available to us and throw this enormously important issue to the wolves—or to a skeleton.

[Lord Teverson]

My Lords, I will speak to my Amendment 9. One of the things I have tried to do in this amendment—I could not do it completely satisfactorily because of where we are in the Bill—is to ask what are the key things we need in place before it is safe and practical for us to leave Euratom and the system we have. There were three specific areas that we needed to cross that finishing line before we entered out into this brave new world. They are listed and they are very clear.

The first is that we should have an agreement from the International Atomic Energy Agency that our safeguarding procedures and the body that we are talking about in the Bill are approved. We need that; without it, we are unable to move forward. Secondly, because we are one of the few nuclear weapon states in the world, we need a voluntary offer agreement with the IAEA that relates to our new status outside Euratom. Thirdly and very practically—we have had a description of the difficulties around this—we need active nuclear co-operation agreements that have been confirmed or agreed by the other side. Whether we can get grandfathering rights on them is very difficult in some instances—the one with the United States has been particularly highlighted in that degree—but we also need to have those in place for those nations where we have active nuclear trading of the type of products listed in the schedules of the Euratom treaty and under the international agreements of the IAEA.

The difficulty in drafting this amendment was that if we do not have these in place, what do we do? My solution to that was very simple: that we should seek temporarily—as the Minister said, we have already gone through the process of agreeing withdrawal from Euratom, rightly or wrongly—to withdraw the notice under Article 106a until we have those three areas of agreement in place and we can be certain that we can go ahead. It is my opinion that we can do that ourselves unilaterally. More certainly we would need to get the agreement of the 27 other member states. That would clearly be the right answer, in that we would continue to be a member until we had those in place.

I was unable to put that in the amendment because it was out of the scope of the Bill, apparently, so I have looked to move on. What we would have to do here is, effectively, to have a transition period. On that, I come back to my question to the Minister that I raised in the first grouping of amendments: do we know that there will be a transition period with Euratom, the negotiation on which, as I see it, is going ahead and will have to be agreed or not on 22 March—it is only a month away—and that we can indeed somehow satisfactorily subcontract all these responsibilities to Euratom and to the international agencies should one of these vital areas go wrong? That is an entirely reasonable question for which I would expect us to have a workable strategy to avoid that cliff edge, if that should happen for all sorts of reasons that, quite clearly, are not totally in the Government’s control. From that point of view we need contingency and to understand the route map if those three areas are not fulfilled. I look forward to the Minister’s response on them.

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[Baroness Vere of Norbiton]

I thank the noble Lord for his intervention. I am on paragraph 11. I have many more paragraphs to go and I hope that in those paragraphs I will be able to keep him very happy indeed.

I understand and share the sentiment of wanting to maintain a close relationship with Euratom. The noble Lord, Lord Warner, mentioned this relationship and it could indeed include any of the things that he mentioned, but they are subject to the negotiations. However, we have already stated very clearly that the Government will seek a close and effective association as part of phase 2 of the exit negotiations with the European Commission. What we cannot accept is that the regulations must await a definitive outcome of talks which are by their nature uncertain in both timing and result. It is therefore vital that we continue to work to enable the set-up of a domestic safeguards regime, and to have ready the bilateral safeguards and nuclear co-operation agreements that we will need to function as a responsible nuclear state from day one of exit.

This approach will reassure the international community that the UK remains committed to nuclear non-proliferation, and will provide clarity to industry that it will continue to be able to move vital materials, parts and expertise once we leave Euratom. There can be no question of waiting until we know the outcome of the negotiations on our future relationship before we can put in place our own arrangements. The implications of not having the right systems operating from when Euratom safeguards arrangements no longer apply are too serious for industry and for our position within the international civil nuclear community.

[Lord Teverson]

Can we actually make this clear? I have not heard anyone in this Committee saying, “Please, Her Majesty’s Government, do not do anything until this thing is finished”. We are not asking for anything to be delayed, we are saying, “Please get on with it”, but we need some information on the way; we have to have some idea of the destination, and Brussels wants some idea of the destination by 22 March and then in October. If it does not happen, what are the contingency plans? We are not asking for anything to not happen now. I do not think the Minister understands that. Did I hear anybody say that?

[Lord Warner]

I put in this provision about regulations only out of sheer frustration because one cannot get any information out of the Front Bench about what that relationship will be. I am not seriously going to stop the Bill proceeding but there is a very high level of frustration across the Committee that the Government cannot explain in any way what relationship they are aspiring to. For example, do the Government want to talk to Euratom about seconding some inspectors to the ONR for a period of time to get it over the hurdle of the transition to a UK regulator? That is the kind of specific thing which it would be quite sensible to discuss. No one is going to stop that. We just want to know what the Government are trying to do.

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[Lord Carlile of Berriew]

I am grateful to the Minister for giving way. I suspect that she is now on paragraph 15, but she is not answering this debate, which is about whether Her Majesty’s Government are prepared to provide specified information to Parliament on certain criteria. What she is telling us would all be very interesting if we had not heard it many times before, but it is a dissertation on the roles of different organisations. Can we please have an answer to this debate? It is 4.32 pm on a Thursday and I would have thought that it could be answered in a few paragraphs—maybe numbers 47 to 50.

[Lord Teverson]

I was happy with the answer that the Minister was giving about NCAs.

[Baroness Vere of Norbiton]

With the greatest respect, I did not interfere in the writing of the speech of the noble Lord, Lord Carlile, and I will crack on a bit further to answer the points raised by the noble Lord, Lord Teverson, as I too think this bit is very interesting. We are talking about these additional countries because we are obviously going to have to set up NCAS with them, too, for trade to continue. I assure noble Lords that discussions on the four priority NCAs started a while back and are progressing well. They are on track to be completed before the UK leaves the EU. I can also assure noble Lords that this Government, as part of their planning process, have factored in the time necessary to seek parliamentary ratification of the agreements both in the UK and in third countries. This will enable the NCAs to come into force from the moment that Euratom arrangements no longer apply to the UK.

I turn now to the UK’s discussions with the IAEA. Noble Lords will be aware that the UK began formal discussions with it some months ago to conclude new safeguards agreements that would replace those between the UK, IAEA and Euratom when the Euratom arrangements are no longer applicable. These discussions, which began some months ago, as my noble friend Lady Neville-Rolfe mentioned, have been constructive and fruitful, and substantial progress has been made. I can be a little more specific: formal negotiations started last September and there were several rounds of preliminary meetings before that. There have been two rounds of negotiations so far, which have made substantial progress. I hope that that is helpful.

The amendment asks that the IAEA should recognise the ONR as the approved safeguards authority in the UK, as mentioned by the noble Lord, Lord Teverson. I will make it clear that the IAEA’s focus in respect of the UK’s safeguards lies with the voluntary offer agreement and additional protocols rather than with the domestic legislation underpinning the domestic regime or the UK Government’s arrangements for fulfilling their commitments. However, as I have set out, the Government have already held productive and fruitful discussions with the IAEA on the UK’s future safeguards agreements and understand what the IAEA requires of us in setting up the system. It is not necessary to consult on the detail of legislation or on the ONR’s readiness to implement the new regime with the IAEA.

As my right honourable friend the Secretary of State for Business, Energy and Industrial Strategy set out in his Statement to the House in September last year, the Government are seeking new agreements with the IAEA that follow exactly the same principles as the existing ones. This will ensure that the IAEA retains its right to inspect all civil nuclear facilities and to receive all current safeguards reporting, ensuring that international verification of our safeguards activity continues to be robust.

In addition to this, the Secretary of State set out on 11 January the Government’s intention to update the House on our overall progress with Euratom, including on the EU negotiations and other important matters such as international agreements. I trust that these reports, the first of which we expect to provide in a few weeks’ time—indeed, just before the Easter Recess—will reassure noble Lords that significant and substantial progress is being made. Indeed, noble Lords will be able to see it for themselves and will no doubt bring it back to the House to discuss, should they wish.

Amendment 15, tabled by the noble Lord, Lord Carlile of Berriew, inserts two new subsections and seeks to require that, by 29 March 2019, the Secretary of State must present to Parliament a substantially detailed report, along with draft regulations implementing any agreements reached with Euratom relating to safeguards, and have such regulations approved by both Houses. Amendment 14 seeks to prevent the substantive provisions of the Bill coming into force until regulations under Amendment 15 to implement safeguards agreements with Euratom have been approved. While I have sympathy with the noble Lord’s aim of ensuring robust parliamentary scrutiny, the process set out in Amendment 15 would not be appropriate. As we have already discussed in our deliberations on this Bill, I am confident that there are appropriate processes in place to ensure proper parliamentary scrutiny of the substantive powers in the Bill. Noble Lords can be assured that the regulations establishing a UK safeguards regime under the powers in the Bill will be subject to the draft affirmative procedure.

I turn now to the report proposed in this amendment. We have been open about our strategy for withdrawal and our future relationship with Euratom. In the Written Ministerial Statement on 11 January, we outlined a twofold approach under which we are seeking a close association with Euratom through our negotiations with the European Union. I refer noble Lords to the Written Ministerial Statement. It goes into some detail about our specific objectives in relation to a close association with research and training, continuity of open trade arrangements and close and effective co-operation on nuclear safety. This is a very broad ambition of ours, and it goes much further than the nuclear safeguards that we are specifically talking about today. Simultaneously with these discussions about our broader relationship with Euratom, on which we will report to your Lordships’ House every three months, we are putting in place measures to ensure that we can operate as an independent and responsible nuclear state from day one.

As noble Lords will be aware, we are planning negotiations on a possible implementation period. The Government have confirmed that they intend to include Euratom matters. This implementation period will start after the date that we leave the European Union. This must be taken into account. We are being open with our plans for a domestic regime, and we have been clear on our intentions for the new domestic regime. As made clear in the Written Ministerial Statement, the Government intend to be able to put in place a robust regime equivalent in coverage and effectiveness to that currently provided by Euratom. To put this more clearly, and for the avoidance of doubt, we would be meeting IAEA standards on day one and working our way to Euratom standards as soon as possible thereafter. A key but inevitable difference will be that reporting and assurance activities would be carried out by the ONR rather than Euratom.

The approach of using a domestic body rather than a supranational one to operate a domestic safeguards regime is common among other non-Euratom countries, such as the US and Canada, whose safeguards regimes consist of a state regulator, with the IAEA providing independent international verification. This approach necessitates some differences in the approach of the regime but we do not consider it to necessitate a reduction in standards. To be absolutely clear about independence, it is the international oversight provided by the IAEA and the inspections carried out by its inspectors that underpin the independence of nuclear safeguards around the world. As I have already mentioned, we have committed to providing Parliament with quarterly reports on progress from across the Euratom programme. These reports will include a section on ONR capacity and readiness as well as on research, which was mentioned by the noble Lord, Lord Fox.

Before I close, I want to return to the comments made by the noble Lord, Lord Carlile, about the meeting that he attended with officials. I want to flesh out the Government’s consultation strategy on this because I fear he thinks it is narrower than is truly the case. The Government continue to have discussions with the nuclear industry on the future of the nuclear safeguards regime. In addition to official-level engagement, Richard Harrington, the Minister for Energy and Industry, held a representative industry stakeholder forum in September. There have been further forums since then and the next one will take place on 5 March. The Government have provided the industry with pre-consultation drafts of regulations that we propose to make, and in late February we held a technical workshop on the draft regulations with key nuclear operators.

I hope my explanations have provided sufficient reassurances to noble Lords, and that the noble Lord feels able to withdraw his amendment.

[Baroness Vere of Norbiton]

I thank the noble Lord, Lord Broers, for that comment. I did have a little more flesh on that particular bone so I shall share it now. On the question of research, the Government’s objectives are set out in our recent future partnership paper, Collaboration on Science and Innovation. We are seeking a close association with the Euratom research and training programme, including the Joint European Torus and International Thermonuclear Experimental Reactor, or ITER, projects. The Government have already guaranteed our share of the funding for the Oxfordshire-based JET fusion reactor until the end of 2020, demonstrating our commitment to continued collaboration.

[Lord Teverson]

My Lords, I found part of the Minister’s statement extremely useful and I thank her for that, particularly on the NCA question.

However, there is an issue on which I would like clarity; I think it is very straightforward, and I ask this in a very positive tone. It is the Commission and the EU 27’s offer and negotiating position on transition that the whole of the Euratom acquis is also included in the broader EU transition agreement. Are the British Government in line with that, and will they go down that route as well? I do not hear that we are rejecting it. We have potential issues with the initial situation over residents and people on the EU side, but are the Government saying they are going to have the Euratom acquis as part of the transition that will be agreed, whether that is until the end of 2020 or the two years? If they were saying that, it would take a lot of pressure off what we are talking about as long as the IAEA was happy with it. That seems a very straightforward question and I presume there is a government policy on it. In the response today to Barnier’s negotiating position I did not see any contesting of the Euratom side of it, so I presume we are going ahead and agreeing that transition in March.

[Baroness Vere of Norbiton]

I thank the noble Lord, Lord Teverson, for that interesting question. If it is okay, I shall write to him, because I should like to find out more information about what we are allowed to say at this time.

Nuclear Safeguards Bill

Lord Teverson Excerpts

Committee: 2nd sitting (Hansard): House of Lords
Thursday 1st March 2018 Lords Chamber

[Viscount Trenchard (Con)]

My Lords, I support what my noble friend, Lady Neville-Rolfe, just said. I would also be cautious about including in the Bill a requirement to ensure that there should be sufficient staffing, because it is not a good reason to decide whether to put in a certain control. Obviously everything the Government undertake to do must be properly staffed.

I ask the Minister to confirm whether the Government consider that a transition period will be necessary for Euratom as well as for the EU generally. I had understood that the Government expected to put in place a satisfactory accredited nuclear safeguards regime before March next year, although I understand that certain doubts have been expressed about whether that is feasible in the time available, given the necessity to obtain the consent of various other countries’ legislatures, with which we would have to establish new nuclear co-operation agreements. Could the Minister tell the Committee whether a transition period for Euratom is envisaged?

I question what the noble Baroness, Lady Featherstone, said about Euratom standards being better than IAEA standards. I understand that the Government’s intention and commitment is ultimately to reach Euratom standards, but I am not sure there is any evidence that Euratom’s standards are better than IAEA standards. Two weeks ago at a briefing by a representative of EDF, together with the NIA, we heard that, in his opinion, the safety standards set by the IAEA are more robust on process, procedures and controls than those set by Euratom and that Euratom concentrates heavily on verification processes that may or may not add anything to achieving a satisfactory level of safeguards. I look forward to hearing the Minister’s comments on that.

[Lord Teverson (LD)]

My Lords, I strongly support my noble friend’s amendment, but want to follow up what was said by the noble Lord, Lord Carlile, who made the obvious point that the more the Government keep us in touch with what is going on, the more confidence everybody, including the industry, has; we might then avoid half the debate we have every time we discuss Euratom. That is true of the whole process of EU withdrawal, but if we could just get it right in this niche area of Euratom, we could save the Government, Ministers and Parliament a whole load of time just by understanding what is going on.

To be honest, I think the Government undersell their position in this area in all sorts of ways. I thank the Minister, the noble Baroness, Lady Vere, for her letter to me in response to my question at the end of the last session about the transition for Euratom, because, so far as I could see, there was no disagreement between Brussels and the UK about it. The noble Baroness’s letter effectively confirmed that. In the legal draft framework on withdrawal and transition, there is a whole area on Euratom—I read it through yesterday; I do not have it here. In terms of the EU-UK relationship, the withdrawal from Euratom, particularly in respect of the transitional period, seems fairly well agreed, and I welcome that. The difficulty I still have is around third parties. There has been good communication on where we have got to with nuclear co-operation agreements, but I am still unclear as to whether the International Atomic Energy Agency and third countries are happy to accept that, while not being a member of Euratom, we can still use all those provisions as a safeguarding regime.

I also noted in the document the expectation of the UK to come up to Euratom standards on nuclear safeguarding. I would be very interested to hear the Minister’s explanation of that and what it means for the transition and withdrawal process.

[Lord Fox (LD)]

My Lords, I do not wish to put a dampener on proceedings, as the word “transition” seems to have lifted your Lordships a little, but does the Minister agree that for there to be a transition there needs to be agreement between the United Kingdom and the European Union on the terms of leaving the European Union and that, in the event of there being no agreement, we go into a period where there is no transition? If that is true, I refer your Lordships to that little lecture I gave on risk on the previous day in Committee: there remains a finite risk that we need a safeguarding regime in March 2019. This provision does not take the pressure off us to get this sorted out and to have a process that delivers the safeguarding regime we need, whether or not the prospect of transition is increased.

--- Later in debate ---

Then there is the ongoing running cost of operating the monitoring and inspections that are presently funded by EU budgetary contributions of £9.5 million a year. The industry is very concerned that the Government will require it to self-fund the safeguarding amount in addition to funding already passed to it for safety and security. The costs of Brexit should be disclosed in full and the Government should play fair by the industry. The Minister agrees, in his letter of 20 February, that they will carry out a full consultation, including close engagement with industry and key stakeholders. Are the Government willing to show their commitment? In answering these questions, will the Minister clarify the position of ownership and retained rights of EU customers to UK operations, such as uranic material at URENCO in Cheshire, that EU customers have the right to use? This could cause operational difficulties of physical segregation. I would be quite happy if the Minister were to write to me on this last, technical note.

[Lord Teverson]

My Lords, as we are in Committee, it may be helpful if I quote article 77 of the draft treaty published by the European Commission yesterday, which is specifically around nuclear safeguards. It states:

“The United Kingdom shall implement a safeguards regime applying a system offering equivalent effectiveness and coverage as that provided by the Community in the territory of the United Kingdom until the end of the transition period”.


That accepts that there is to be a transition period, as long as we are not in a no-deal situation. There is a transition period—there is no disagreement between us and the EU about that—but the EU expects that to be at Euratom standards. I cannot see that that can be any different if we remain within the acquis during that period, which I think both sides are agreed to anyway.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)]

My Lords, I start by offering my apologies to the noble Lord, Lord Grantchester, as he did not receive a copy of that letter. I will make sure that copies are made available. I thought that I had arranged for copies of all the letters—those I sent on the 20th, the one on the 28th to the noble Lord, Lord Carlile, and the one from my noble friend, I think again on the 28th, to the noble Lord, Lord Teverson—to be placed in the Library. After 40 years in this House, I still do not quite know exactly what that means—I think one can go along to the Library and get a copy, but I leave that to noble Lords. I will certainly make sure that copies are made available to all those who want them.

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Moved by

[Lord Teverson]

10: After Clause 1, insert the following new Clause—
“Freedom of employment for specialists
Article 2(g) of the European Atomic Energy Community Treaty, ensuring freedom of employment for specialists, continues to have effect in UK law in relation to those who work in nuclear safeguarding, after the United Kingdom leaves Euratom.”

[Lord Teverson]

My Lords, let me say first that the last thing that I would expect—and this will be a great relief to the Government—is for this amendment in its current state to be in the final Act as it is passed. It is in many ways a probing amendment, but an absolutely critical and important one. I quote Article 2(g) of the Euratom treaty to which this amendment relates. It says that the Community shall,

“ensure wide commercial outlets and access to the best technical facilities by the creation of a common market in specialised materials and equipment, by the free movement of capital for investment in the field of nuclear energy and by freedom of employment for specialists within the Community”.

So it is all around being able to take advantage of that freedom of movement of nuclear specialists, particularly as this amendment has to relate to safeguarding only—but really it is much more general than that, into the future and beyond our withdrawal from the Euratom treaty.

One great privilege that I have in this House is to chair one of the European Union Select Committee sub-committees, the EU Energy and Environment Sub-Committee. We have undertaken a number of Brexit reports over the last year, including on environment, energy security—from which I shall quote in a minute—agriculture and fisheries and animal welfare. We are currently looking at food security. One key theme of all those reports, very much on a cross-party basis, is the issue of supply of specialist labour after Brexit has taken place, and how a number of those sectors, from agriculture right the way through to the nuclear industry, are dependent on specialists. Those specialists are not always the great and the best and the Nobel Prize winners whom we want in this country, but they are the people who have their own specialist skills in things that you would not necessarily take degrees in—particularly in the agricultural sector—and we can take advantage of those skills because they are not available in the United Kingdom.

I just give one or two examples from our report Brexit: Energy Security, to which we are still waiting for a government response—which is not overdue at the moment, I would add. The noble Lord, Lord Rooker, quoted these examples on our previous day in Committee, but I will go back through some of them, particularly around energy security and the nuclear industry workforce. In paragraph 41 of the report, we quote EDF, which stated:

“The highest concentration of non-British nationals as a percentage of the total employed workforce is within Nuclear New Build”.


Angela Hepworth, the corporate policy and regulation director of EDF provided some detail saying, on Hinkley Point, which is new nuclear,

“we are going to need 1,400 steel fixers. At the moment, the total population of certified steel fixers in the UK is 2,700 so we would need more than half of the total”.

The Institute of Mechanical Engineers stated that,

“the nuclear sector relies heavily on skilled workers from Europe”,

as did the Centre for Nuclear Engineering at Imperial College London:

“The free movement of skilled professionals within the nuclear industry is critical to its long-term success”.


Energy & Utility Skill told us that,

“any new immigration policy must avoid arbitrary distinctions between ‘higher’ and ‘lower’ skilled jobs, based on inaccurate criteria such as whether or not it requires a degree”.

I am well aware that this is broader than safeguarding itself, but safeguarding is also a part of that nuclear skill set and this is the only way that I could really get this in the Bill, because our safeguarding regime is a key area where we have this challenge. I emphasise again that I am quite satisfied that the UK and EU 27 can come to an agreement on a transitional period that gives us extra time; I am relaxed about that, but I am not relaxed about the point made by my noble friend Lord Fox that, with the other issues that there are around the withdrawal treaty—not least around Ireland—the possibility of coming to no deal has perhaps gone up. We still need to have a strong contingency so that we are ready in this area by 29 March next year.

The only way that I can see for us to do that is to make sure that we continue freedom of movement for nuclear specialists beyond our withdrawal from the agreement. On this, I remind the Government that the nuclear industry is one of the key sectors identified in their industrial strategy and, if that is to be fulfilled, we need to make sure that freedom of movement continues in this area—and, I would say, more widely than just safeguarding.

My question to the Minister is: will BEIS have enough backbone to really confront the Home Office, and perhaps No. 10 as well, on this issue, because the Home Office is naturally resistant to anything to do with migration? Will we be able, through the discussions between BEIS, the Home Office and perhaps No. 10, to make sure that this freedom of movement within the nuclear industry, not least in the safeguarding sector, continues after Brexit? I beg to move.

--- Later in debate ---

[Lord Henley]

I am fully aware of the concerns of the noble Lord and of the industry. Obviously it is a matter for the Home Office to develop these policies, and I am very grateful that a Home Office Minister—just by chance—happens to be sitting near me; she will listen to this and take it back to her colleagues. I repeat that we are satisfied that we can deal with safeguarding. Our concerns, the noble Lord’s concerns and other concerns will be dealt with. Proposals for a future immigration system will be set out shortly. That is something that my right honourable friend the Secretary of State for Business, Energy and Industrial Strategy will play his part in.

The noble Lord said that his amendment was a probing one. I hope that I have given the appropriate assurances for him to withdraw it.

[Lord Teverson]

I thank the Minister for his response. No doubt this debate will continue when we debate the Brexit and energy security report on the Floor of the House. I will just say—to all Ministers who are present—that the whole of history tells me that this is going to be a very difficult ask. It seems obvious, in terms of getting it right for the nation, that it ought to happen, but I suspect that it will be a lot more difficult than perhaps the Minister hopes. I will reflect on the answer and see whether there is anything more exacting we can say on Report—but at this stage I beg leave to withdraw.

[Lord Skelmersdale (Con)]

Before the noble Lord withdraws his amendment, as he said he would, I have noted that this debate has been entirely about new build, but surely one of the great problems in this area will be the experts needed for decommissioning.

[Lord Teverson]

I thank the noble Lord for his contribution. He is absolutely right. Experts are needed not only for decommissioning but for keeping going the existing fleet of nuclear power stations, which provide some 20% of low-carbon energy to our energy system at the moment. We also need nuclear co-operation agreements so that we have not just people but spare parts and everything else for this sector. I can see that the Minister wishes to intervene.

[Lord Henley]

I just want to interrupt the noble Lord to offer him one further statistic to indicate how long this will continue. Again during my trip to Sellafield, I was reminded that decommissioning there will continue well into the next century—in other words, the grandfathers of the people who will be working on it then have not yet been born.

[Lord Teverson]

The whole area of the financing and decommissioning of Sellafield is the subject of another debate—and a contentious one—which we will not get into. At this stage, I beg leave to withdraw my amendment.

Amendment 10 withdrawn.

Nuclear Safeguards Bill

Lord Teverson Excerpts

Report stage (Hansard): House of Lords
Tuesday 20th March 2018 Lords Chamber

In these circumstances, I suggest to the House that the only responsible action the Government could take is to remain part of Euratom until new arrangements can be guaranteed to be in place. If the Government are unwilling to do this, it is in the national interest for the House to pass this amendment and ask the Commons to think again.

[Lord Teverson (LD)]

My Lords, I am very happy to have added my name to this amendment. I am chair of the House’s EU Energy and Environment Sub-Committee, which looked at the subject of Brexit and energy security. Regretfully to some, we did not come out with any great headlines that said that the country was going to grind to a halt on the energy side, although we did say there was probably going to be an increase in prices because of increased electricity trading inefficiency. However, we made one exception, which we thought at that time was probably unlikely, but the evidence since might push this the other way. If the UK did not manage to replicate the agreements that Euratom has with the rest of the world and the IAEA, then there was a real risk of our current fleet of nuclear power stations coming to a halt, Hinkley C not being built and various other problems in terms of our deep work in nuclear research.

That is why this amendment absolutely puts its finger on the issue. It goes through the three things that have to be agreed for the United Kingdom to be able not just to fulfil its own obligations internationally but to be able to trade in nuclear material, people and spare parts even, post Brexit. What are they? We clearly need our own Office for Nuclear Regulation to be approved as a safeguarding authority by the IAEA, which is clearly essential; we need a voluntary offer agreement with the IAEA; and we need to replicate a number of our nuclear co-operation agreements with the rest of the world. I have certainly not heard, anywhere, even any attempt to try to give confidence that we will be able to roll over any of these NCAs following Brexit. But there are a large number of hurdles to achieving these aims, and this is going to take time.

In terms of the approval by the International Atomic Energy Agency of a safeguarding regime, they include recruitment, which the noble Lord, Lord Hunt, has talked about many times and was covered in the evidence that came to the House of Commons Select Committee. There is the training of those personnel. There is the retention of those personnel, which has been highlighted by the noble Lord, Lord Rooker, on previous occasions, as once they are qualified, there is a very strong international demand for them. There is also the issue, which I raised in Committee, of IT systems, and I thank the Minister the noble Lord, Lord Henley, for his reply to my Written Question, which very carefully went through the new systems that are required for us to be able to function as a safeguarding authority. Those systems are quite substantial, and we will come on to that—on my Amendment 9A—later today.

Of course, we also need to negotiate an agreement with the IAEA itself. When it comes to nuclear co-operation agreements, these are absolutely essential to us for our nuclear fissile material for power stations, for repairing, for spare parts and for nuclear intellectual property. It is very difficult to replicate those agreements so, as the noble Lord, Lord Warner, absolutely showed far better than I could, two of our key nuclear co-operation agreements—one with the United States, a legal requirement, and one with Australia, as the Minister highlighted in Committee—would expect us to be full members of the IAEA and to be able to have nuclear co-operation agreements in order to trade those materials. Even just in those two countries, we have major hurdles.

Turning to the voluntary offer agreements, these agreements are only necessary—or only made—by the five nuclear weapon states, or those that have declared as such; India, Pakistan and Israel have separate arrangements. I cannot imagine, however, that as a country that is one of the five permanent members of the United Nations Security Council and that stands for the upholding of international law and for the importance of the nuclear non-proliferation treaty, we would allow ourselves to go ahead without having concluded such an agreement with the IAEA.

That is why this amendment is so important. If we cannot fulfil these three criteria, then we should not go ahead: we should postpone leaving Euratom. Why is the date of 1 March 2019 there? Clearly, it is four weeks before we are set to leave the European Union. Like others, I have looked at the agreement that was made yesterday, and there is a separate article and chapter on Euratom. Paragraph 2 of Article 76 of that agreement—which is in green, meaning that it has been agreed by the European Union and ourselves in detail—says very starkly:

“The United Kingdom shall have sole responsibility for ensuring its compliance with international obligations arising as a consequence of its membership of the International Atomic Energy Agency and of the Treaty on the Non-Proliferation of Nuclear Weapons”.


When you look to the transition chapter, there is no mention of Euratom, or of paragraph 2 of Article 76 being postponed in any way. This ties up with the Government’s own view. We will be leaving Euratom on 29 March next year unless we make other arrangements, and the EU 27 and the UK are agreed on that position. That is why this is a matter not just of energy security but of national security.

[Lord Hutton of Furness]

I want to say a few words in support of the amendment of the noble Lord, Lord Broers. I draw the House’s attention to my interest in the register: I am currently the chair of the Nuclear Industry Association.

None of us in this House or outside who has been following this debate really has any doubt at all that the Government are seized of the significance of the challenge that we face. Having made the decision, which many of us regret, to leave the Euratom treaty, the Government have to do two things against a very tight deadline. The first is to replace the existing Euratom safeguarding regime, which, as other noble Lords have said, is a very important part—in fact, the central part—of one of our obligations as a nuclear weapons state: to ensure against the risk of nuclear proliferation. That is a big challenge. We have not exercised that function, which is currently done for us by Euratom, and building up the capability under the auspices of the ONR is a difficult challenge. The ONR itself has said, in evidence in another place, that it probably will not be ready to fully discharge those responsibilities by next March. So the Government—rightly, in my view—have come to the view that they need a little more time, once we have left the EU, to ensure that the ONR can step up and do that job, but it will be touch and go.

The other thing that the Government need to do, although, with respect to the Minister, they have come to this a little late, is to put in place all the machinery necessary for the continuance of the nuclear co-operation agreements that exist between ourselves and Japan, the US, Canada and Australia, our principal nuclear friends and allies, for the continuing exchange of information, goods and services in the nuclear sector. Of course, unless we are able to move seamlessly from the current NCAs to the new arrangements, the trade in goods and services will come to an end at the end of the implementation period at the end of 2020—assuming that the implementation period is agreed—unless in that period we have successfully put in place alternative nuclear co-operation agreements.

The fundamental reason why your Lordships’ House should pay close attention to the amendment is that it is good to have a default or a back-up. Suppose we do not get to the point at the end of the implementation period where these nuclear co-operation agreements have all been agreed, renegotiated and put into legal effect. The noble Lord, Lord Warner, drew our attention to some of the issues of complexity around renewing the NCAs. The process is not in our gift; we do not have control of the process whereby these replacement nuclear co-operation agreements will take legal effect, because in many of those countries they are international treaties—and will require the consent of, in the case of the US, the US Congress.

Any student of US politics knows one thing: that international treaties progress very slowly in Congress. Something that we have come to see in the US repeatedly, under both Democrat and Republican Presidents, is the extraordinary process that we in the UK do not understand at all where the US Government shut down because of, for example, a failure in Congress to agree budgets. We have no say in or control of that. Suppose there is a prolonged shutdown in the government machinery of the US at the very time when we want the US Congress to renew the nuclear co-operation agreement. What do we do then?

Fundamentally, the amendment poses that question: what do we do, all of us, if, with the very best of intentions and the absolute commitment of the Government, which I do not doubt, to renew these nuclear co-operation agreements, the implementation period comes to an end and we have not succeeded in putting into place the nuclear co-operation agreements? It seems pretty obvious that, despite all the difficulties of trying to construct a default or backstop, we have to give attention to the risk that we come to the end of that period and we have not renegotiated successfully—through no fault of our own but simply because we do not control all the processes that are involved in moving pieces of the jigsaw—and we do not find ourselves in the situation, where we all want to be, where these NCAs can be seamlessly renewed.

If we get to that point where the NCAs are not in place with our key nuclear trading allies, we have a major problem. In my view, it would become impossible for the vital exchange of goods and services in the nuclear sector to continue beyond that point legally and lawfully, and if it cannot be done legally and lawfully then it will not be done at all. The noble Lords, Lord Warner and Lord Teverson, have referred to the problem which that might create for the energy security of the UK. I am sure I cannot be the only person in this House to say, “I don’t think any of us should take a gamble or a risk with the energy security of our country”. Given the important role of the nuclear industry, that is precisely what we will be doing if we do not find the wherewithal in this Chamber today to find a way of constructing a backstop for the “What if?” moment if at the end of the day these nuclear co-operation agreements cannot be brought into effect at the time when we want them to be. That seems to be the issue that the amendment has raised, and it is not going to go away. We have to have an answer somehow to that fundamental question, and I look forward to what the Minister has to say.

--- Later in debate ---

Moved by

[Lord Teverson]

8: After Clause 2, insert the following new Clause—
“Freedom of employment for specialists
(1) Article 2(g) of the European Atomic Energy Community Treaty, ensuring freedom of employment for specialists, continues to have effect in UK law in relation to those who work in nuclear safeguarding, after the United Kingdom leaves Euratom.(2) In this section “specialists” includes those staff essential to the United Kingdom’s nuclear safeguarding.”

[Lord Teverson]

My Lords, I remind Members of what the Euratom treaty says in Article 2(g)—that, in order to perform its tasks, the community shall,

“ensure wide commercial outlets and access to the best technical facilities by the creation of a common market in specialised materials and equipment, by the free movement of capital for investment in the field of nuclear energy and by freedom of employment for specialists within the Community”.

I have not taken the whole of the article, or of part 2(g), into the amendment, but rather the important post-Brexit part, which concerns the free movement of nuclear specialists. I will not make a long speech because I believe that this is self-evident. The Government have an industrial strategy around the nuclear sector: to expand it and for it to be part of where this country goes economically.

We have heard in previous debates that our most important need in the short term is to have a functioning safeguarding authority, whether that is Euratom or—as soon as that stops—our own Office for Nuclear Regulation. We need those bodies, and that body in particular, to function. We have a shortage of qualified people in this area and a shortage of specialists in the industry more generally—although the amendment is, because of the Bill, primarily around safeguarding. Therefore, it must be in the interests of the Bill, and of the country at large, to ensure that we maintain the mobility of those specialists in the nuclear industry and the nuclear sector, so that we maintain this benefit post Brexit and post our membership of Euratom. That is why the amendment is absolutely appropriate to the Bill and is of great importance not just to this sector but to our national security.

I very much hope that the Minister will be able to give a greater reassurance—perhaps higher up on my noble friend Lord Fox’s Richter scale of assurances—than we have received so far that this area will be looked after by the Government, that we will not be browbeaten by the Home Office into having a minimal circulation of specialists, and that this country will benefit from those with the experience and skills that will enable us to perform in this sector, not just in safeguarding but in the nuclear sector more broadly. I beg to move.

[Lord Warner]

My Lords, I have added my name to this amendment because, like the noble Lord, Lord Teverson, I remain concerned about the industry’s access to the workforce that it will need once the UK leaves Euratom. I suggest that the free flow of essential specialist staff could well dry up unless the Government are reasonably energetic in the guarantees that they give them. As the noble Lord, Lord Teverson, said, this is not just a safeguarding workforce issue; it affects the whole sector, as was very well brought out in the Nuclear Industry Association’s briefing. I shall not go into detail on that but it is clear that we need a very skilled workforce coming to this country to help both in maintaining existing reactors and, even more significantly, in building new ones, as well as in the safeguarding area.

With regard to the regular reports that the Government will give to Parliament on progress in the safeguarding area, it is a bit disappointing that we did not manage to get into the Bill a specific reference to the need for an essential specialist workforce. I hope that the Minister will take this suggestion in the spirit in which it is offered, and perhaps he might encourage his officials, when they are producing these reports, to say something about the progress that is being made, particularly with the ONR getting the specialist staff that it needs.

--- Later in debate ---

[Lord Henley]

As I remember, the last time we debated this, by chance—I may be misremembering—a Home Office Minister was sitting next to me. I can confirm, however, that the Home Office is fully aware of the concerns expressed in debates of this sort, and we will make sure that it continues to be so. It is important to us that we continue to—as I put it—access the best talent. As the noble Lord will be aware, we have already doubled the number of available visas in the tier 1 exceptional talent review, and will be looking at changing Immigration Rules to enable world- leading scientists and researchers under the tier 1 route to apply for settlement after three years and to make it quicker for highly skilled students to apply for work in the United Kingdom after finishing a degree. We are, therefore, relaxing the labour market tests where appropriate.

The crux of this amendment, which relates to safeguarding staff—the Bill has been drafted in that way and so the amendment must be too—attempts to ensure the freedom of employment of specialists employed in that field. This is clearly a matter of particular interest in the light of the Government’s preparations for establishing a domestic nuclear safeguards regime, which, among other important work, means securing the right quality and quantity of appropriate safeguarding staff in the Office for Nuclear Regulation. Given the importance of attracting the right staff to work in this specialist field, the Government are committed to ensuring that the ONR has the right personnel. I can give the House a bit of information: in the most recent recruitment round for two further posts in this field there were 112 applicants for the ONR to look at. We will continue to work with the ONR to ensure that it has the right staff to regulate the UK’s new civil nuclear safeguards regime. Those figures show that there is no shortage, certainly in the world of recruiting and training the appropriate inspectors and building additional institutional capacity.

The noble Lord will not be surprised if I do not go into this, because he will then ask for further details. If I give him an assurance that the amendment is possibly itself defective and not suitable for inclusion, and he accepts that in spirit there is no need for it—since the Government are committed to ensuring that we have the right specialists and the Home Office continues to work in this field—I hope that he will feel able to withdraw Amendment 8.

[Lord Teverson]

I thank the Minister for his reply. It is good to have some figures: can we have more of them in these interactions around groups? I also remind the Minister that he regularly mentions the highly skilled and the talented. That may, I agree, be the case in nuclear safeguarding, but in a lot of Brexit areas, perhaps including some areas of the nuclear industry, the need is far broader. However, I take his point in regard to this Bill.

I also recognise that this issue will inevitably be fought out during the immigration Bill that we will eventually get. I am delighted that we will have another opportunity to debate Euratom in another Bill, to pursue sanity and perhaps get some change in this area. I therefore accept the noble Lord’s challenge—as it were—and his assurances about taking up these issues in the future immigration Bill, which we continue to await with interest. In the meantime, I beg leave to withdraw the amendment.

Amendment 8 withdrawn.

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Moved by

[Lord Teverson]

9A: After Clause 2, insert the following new Clause—
“Report on information technology systems necessary for nuclear safeguards
(1) The Secretary of State must, in respect of each reporting period, prepare a report containing information about the progress made to provide adequate information technology systems necessary for the United Kingdom to operate a nuclear safeguarding regime to international standards.(2) The report under subsection (1) must include the progress on, and the estimated cost of, developing the following systems—(a) a State System of Accountancy for and Control of Nuclear Materials;(b) a Safeguards Information Management and Reporting System; and(c) any other technology system necessary for the United Kingdom to operate an effective international nuclear safeguarding regime.(3) A report under this section must be laid before both Houses of Parliament after the end of the reporting period to which it relates.(4) There are four successive reporting periods, each of which is a period of 3 months.(5) The first reporting period is the period of 3 months beginning with the day on which this Act is passed.”

[Lord Teverson]

My Lords, in Committee I raised an issue that I do not think has been raised before, about the information systems required for the Office for Nuclear Regulation to perform its tasks acceptably as a safeguarding agency in the international system. I subsequently submitted a Written Question to the Government on this matter, and I thank the Minister, very genuinely, for a comprehensive and interesting reply—a very good one. In that regard, I almost feel that I have to apologise to the House for the long names in subsection (2)(a) and (b) of the amendment: the State System of Accountancy for and Control of Nuclear Materials and the Safeguards Information Management and Reporting System. The Minister informed me that these were needed to fulfil our international obligations.

I also asked what those systems would cost, less to understand the cost than the size of the task that needed to be completed within the next 12 months. I will quote from the Minister’s Written Reply:

“ONR has estimated that it will cost £10 million to establish a UK SSAC and SIMRS”—


the two systems—

“is included as a part of this overall estimate. An initial tender opportunity in relation to the SIMRS is currently being advertised on the Government Digital Marketplace and responses to that tender will provide more certainty on estimated costs”.

I do not know whether we already have the other system—I do not think so—but what concerned me particularly about that reply was that we are only tendering for one of those systems. It is clearly a significant cost—£10 million for both—but we are only just getting around to advertising them. From both my corporate career and my role in this House in scrutinising what the Government are up to, and government systems, I know that it is not the easiest thing to predict when IT systems will be ready, let alone functioning. We had a debate last week about the Smart Meters Bill and all the IT needed for that, and it is 12 years later that we have come to those particular systems.

My real question is a serious one. Clearly, from the Minister’s reply, the ONR cannot function properly without these systems, but we are only at the stage of advertising just one of them. The size of them is at least £10 million and I feel very nervous that these systems will be ready when we need them to be ready on 29 March next year. That seems to be quite an ask. Therefore, with the amendment I am looking for some substantive reassurance from the Minister that this is under control and that it will be part of the Government’s reporting mechanism between now and our leaving date for Euratom, so that we can understand the progress in this critical area—an area where, to put it lightly, the Government do not have the greatest reputation in terms of delivering such systems. I beg to move.

--- Later in debate ---

[Lord Henley]

My Lords, I am grateful to the noble Lord, Lord Teverson, for moving his amendment. He and the House really want two things. They want substantive reassurances and details of further reporting. I asked to have this amendment grouped with Amendment 6, which to some extent deals with this matter. We propose to put such reporting on the face of the Bill, and progress with the information technology systems required for the safeguarding regime will fall within that reporting duty. I hope that the noble Lord will feel that he does in due course get sufficient information. In the meantime, I will give an update about what is happening. As the noble Lord, Lord Fox, said, I might have to write with further detail later on, but let us see how the quarterly statements take place to see whether they provide sufficient information. If not, noble Lords can come back to me.

The overall system of safeguards is generally referred to as a state system of accountancy for and control of nuclear materials. The noble Lord referred to that in my original Written Answer. That is also known as an SSAC. The last time I came across SSAC it was the Social Security Advisory Committee, but that was in another world and another place. We will not go there now. As part of this, the ONR plans to put in place an IT system which it refers to as the safeguards information management and reporting system. I do not know how you pronounce “SIMRS” so we shall refer to it by its initials. The SIMRS is aimed at enabling the ONR to obtain and process the information necessary to ensure timely submission to the International Atomic Energy Agency of the reports required by any future safeguards agreements with the agency. The SIMRS will also enable submission of any specific reports required by supplier states as part of nuclear co-operation agreements.

The ONR has estimated that it will cost some £10 million—the figure I gave some weeks ago in Committee—to establish a UK SSAC, and the SIMRS is included as a part of this overall estimate. A pre-qualification questionnaire in relation to the SIMRS was recently advertised on the Government’s digital marketplace. Sixteen suppliers responded, of which six have been invited to respond to the invitation to tender by 6 April. Responses to that tender will provide more certainty on estimated costs, and the ONR expects to let the contract in early May.

I of course take note of what the noble Lord, Lord Warner, warned about IT systems from his experience with the health service and the Home Office. We are all aware of problems that new IT systems can have. I do not think that what we are proposing here is on the scale of what the National Health Service needs, but I accept that there can be problems. We and the department have a duty to examine that as carefully as we can. I give an assurance that we will do that as far as is possible.

Put very simply, that is where we are at the moment. We will keep noble Lords updated. We have accepted my Amendment 6, as amended by the amendment moved by the noble Lord, Lord Hunt. There is no need to further complicate the Bill’s proceedings by adding this amendment, which duplicates what we already have. Therefore, I hope that the noble Lord will feel able to withdraw his amendment.

[Lord Teverson]

My Lords, I thank the Minister and welcome his undertaking that the IT systems will be included in the regular reporting. It would be useful if the Minister could answer my noble friend Lord Fox’s question about whether they are starting from zero or whether we are effectively modifying existing systems.

[Lord Henley]

I give an assurance to write to the noble Lord, Lord Fox.

[Lord Teverson]

I welcome that and on that basis beg leave to withdraw the amendment.

Amendment 9A withdrawn.

Nuclear Safeguards Bill

Lord Teverson Excerpts

Ping Pong (Hansard): House of Lords
Wednesday 6th June 2018 Lords Chamber

[Lord Broers (CB)]

My Lords, as one whose name was on Amendment 3, it gives me pleasure to support the replacement of that amendment with Commons Amendment 3A. The Commons amendment supports the basic proposals that we put forward in the Lords amendment but is more detailed and will better ensure that, if adequate agreements are not in place 28 days before exit day, the Secretary of State must request the continuation of the present Euratom arrangements. Amendment 3A more tightly defines the request that the Secretary of State must make and the relevant principal international agreements, and seeks to eliminate other possible ambiguities.

I would also like to say how much I welcome the Government’s acceptance of other Lords amendments, particularly the one that specifically points out that civil nuclear activities for peaceful purposes include production, processing or storage activities, electricity generation, decommissioning, research and development—a particular interest of mine—and any other peaceful nuclear activities.

Overall, I observe that the way this Bill has been handled is an excellent example of what can be achieved when there is constructive collaboration between the political parties, we Cross-Benchers and even between the Lords and the other place. Our parliamentary system has really worked well in this instance and it is my sincere, if naive, hope that this admirable spirit of collaboration continues throughout the consideration of all of the other Brexit-related Bills.

[Lord Teverson (LD)]

My Lords, I am also very pleased that we have come to a suitable arrangement. I support this amendment and reflect the comments of the noble Lord, Lord Broers. However, the challenges in achieving this are still major. We know from the leak from the risk assessment of the Office for Nuclear Regulation that we have an IT system that has only just been commissioned and timescales are very short for that £100,000 programme. We know that training has not been fast or easy in terms of recruitment or giving skills to those people to ensure that we have the right number of people in the Office for Nuclear Regulation. We have already had a concession that the standards that can be met by Brexit day are best international, rather than the Euratom standards the Government originally wished for.

Also, I understand that we have not yet had ratification of any of those nuclear co-operation agreements. Although I recognise and welcome the fact that we have agreement with the United States, agreement is not ratification. As the Minister himself said in a Written Answer to me:

“Ratification in the US requires the agreement to remain in Congress for 90 joint sitting days, whereby the US Senate and House of Representatives both sit, and the consent of two-thirds of the US Senate. Congress also has the option of adopting either a joint resolution of approval, with or without conditions, or standalone legislation that could approve the agreement. UK officials have held detailed discussions with the US and both sides are satisfied that this process can be completed ahead of the UK’s withdrawal from Euratom”.


I am glad to hear that optimism, but I still believe that that is a very difficult timetable to meet. I will be interested to hear from the Minister where we are on the other three nuclear co-operation agreements as well.

[Lord Carlile of Berriew (CB)]

My Lords, as another who took part in the earlier stages of this debate, my eye joined with my noble friend Lord Broers in expressing thanks to the noble Lord, Lord Henley, for listening to the arguments that were made earlier, and to the Government for showing that the dynamic relationship that sometimes exists between your Lordships’ House and the House of Commons actually improves Bills, even in the febrile context of Brexit. I hope that this result today on Motion A, which I certainly support, will be a clear message to those who are given to say glibly that your Lordships’ House is merely trying to wreck Brexit. That is just not true. What is happening this afternoon is clear evidence, which the Government should cite, that there can be constructive work between the two Houses to improve even the legislation on this very difficult issue.