Infrastructure Bill [HL]

Lord Tunnicliffe Excerpts

Monday 9th February 2015 Lords Chamber

[Lord Teverson]

My Lords, I welcome these amendments and very much welcome what my noble friend just said. I do not point at my noble friend in saying this, but I am always disappointed, given the truism about gas being the future, that we have not made more effort to make sure that, in the short term, gas is substituted for coal and that we have a far more rigorous gas industry than we have at the moment. That was the route forward, but we have been unable to put it to bed during the passage of the Energy Bill and now of the Infrastructure Bill. I hope that it is something that can at least be given greater attention after the election. However, I welcome these new clauses.

[Lord Tunnicliffe (Lab)]

My Lords, the government amendments in this group touch on the role of the Committee on Climate Change in advising on the impact which combustion and fugitive emissions from petroleum have on the carbon budget. I understand that this was introduced in the other place as a result of a Lib Dem initiative, and we are fully supportive. We have always said that, if fracking is to take place, we would need the appropriate framework for regulation and need to consider a wider range of issues on which it will have an impact, including climate change. The Climate Change Act 2008, which was introduced by the then Labour Government, was an important piece of legislation that subsequently established the Committee on Climate Change. We therefore support the Committee’s role in advising the Government.

[Lord Teverson]

Before the noble Lord, Lord Tunnicliffe, sits down, can I just point out one thing that I want to get off my chest? The Climate Change Act was a great thing that the Labour Government did, but among the amendments that they did not allow was one about excluding traded EU ETS certificates from the carbon budget. That means that the power sector is still largely excluded from the Climate Change Act and carbon budgets. It is a big hole in the system and it is regrettable that those changes were never made.

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[Lord Young of Norwood Green]

I thank my noble friend, but a significant amount will still be LNG and I do not think that undermines my point. I know that my noble friend Lord Truscott has lots of experience, but I must admit that I was surprised by his analysis. Even if we are sceptical, it was a British geological survey, after all, which identified 1,300 trillion cubic feet of natural gas. If we take only 10% of that as capable of being extracted, which is a reasonably modest assessment, that is something like 40 years’ supply of the gas that we use—and we are being invited to say that we should not even consider using it.

My noble friend suggested that it was all about the current price of oil and gas. Of course we should take that into account, but as he was invited to say, is he seriously thinking that companies will invest in shale exploration without any prospect of return? I talked to companies recently about this and said, “Aren’t you deterred by the current price?”. They said no, because they do not invest at today’s prices. They are talking about a plan that is likely to take five years. I do hope that the House will support the government amendment.

On protecting groundwater, of course we should be doing that. Again, I have looked at this carefully. Apart from the fact that there has been very little evidence of methane contamination from fracking, we are talking about a six-inch pipe being drilled down. When it goes through the aquifer, which is at approximately 300 to 400 feet, multiple layers of steel and concrete contain the gas on its way to the surface and prevent it escaping into surrounding rock and groundwater.

What about the myth about the chemicals? We should remind ourselves that 99.95% is just sand and water and that the 0.05% consists only of approved non-hazardous chemicals, one of which is polyacrylamide, which is used for contact lens solution. We would be unlikely to use that chemical for a solution like that if we thought that it was seriously hazardous.

I am just as concerned about the environment and the water supply as the noble Baroness, Lady Jones of Moulsecoomb, but I am also concerned about those who, frankly in my opinion, misapply science and deliberately distort data rather than convey to the public the facts and the independent assessment, which is what this House should be doing. On those grounds, I hope that this House will overwhelmingly support the government amendments.

[Lord Tunnicliffe]

My Lords, it may be for the convenience of the House if I set out the Labour Party’s position on this group of amendments, because what I hear is a gathering debate on the merits of fracking and I have no intention whatever of referring to that.

The essence of our position is to explore the difference between Amendment 21 and the other amendments in the group and to try to persuade the Government that their amendment may require fine tuning. However, we will not seek to divide the House on our amendment and we will not support the amendment in the name of the noble Baroness, Lady Jones of Moulsecoomb.

On Monday 26 January, the Government accepted a Labour amendment to the Infrastructure Bill to overhaul the regulations for shale gas. This was a huge U-turn by the Government and a big victory for the protection of Britain’s environment. Labour has always said that shale gas extraction cannot go ahead unless there is a system of robust regulation and comprehensive inspection, but David Cameron has repeatedly ignored people’s genuine and legitimate environmental concerns over shale gas. Now, thanks to Labour’s amendment, the Government have been forced to accept that tough protections and proper safeguards must be in place before fracking can go ahead. I must make it clear that we are very pleased about the Government’s U-turn and think that it is in the best interests of the nation and the environment.

On Thursday 5 February, the Government tabled their own redrafted version of the amendment that is before the House today. Our position remains as it has been for three years: namely, that regulatory gaps need to be filled to ensure the right conditions are in place before any drilling to explore or extract unconventional gas is permitted. The Government’s amendment accepts a number of the regulatory safeguards that we proposed, which we welcome. However, it also excludes protections that were agreed to in the other place, most notably on the monitoring of fugitive emissions, notification of residents affected by fracking, and safeguards for protected areas and groundwater source areas. I must make it clear to the House that if the Government’s amendment is passed today, it will be challenged, if necessary, in the other place. Therefore, we will listen to the Minister’s response with great care, and it will be considered with great care by colleagues in the other place.

While the Government have said that their version of the Labour amendment redrafts, but does not substantially alter, its terms, I have a number of concerns. The original Labour amendment referred to fugitive emissions. The government version limits this to fugitive methane emissions. Does the Minister recognise that there will be other emissions arising from shale extraction, including CO₂? Why have they not included this in the scope of their amendment?

The original Labour amendment referred to mandatory environmental impact assessments. The government version refers only to the environmental impact, stopping short of a full EIA. Will the Government explain their rationale for this? What, in the eyes of the Minister, is the practical difference between a full EIA and the requirements of this proposed new clause?

The original Labour amendment referred to no fracking within or under protected areas. The government version refers to that only within protected areas. Does the Minister accept that this could still lead to hydraulic fracturing underneath national parks and other areas?

The original Labour amendment referred to a prohibition on developments inside groundwater protection zones. A definition of groundwater protection zones is already given by the Environment Agency, yet the government version refers to protected groundwater areas and suggests that these should be defined in a future statutory instrument. Why are the Government not using the existing definition?

The original Labour amendment required that residents should be notified individually. This is not required in the government amendment. The Minister has already set out some of the reasons for not accepting this requirement. It seems to me that she should go further in explaining why this requirement cannot be met. I believe that the requirement for individual notification exists in other legislation and that the practicality of the absolute concept which she used in her argument is overcome in other legislation. We certainly want to make sure that residents are fully informed and that there is a high probability of all individuals affected being informed.

I repeat that we will not divide the House on our amendment or support the amendment in the name of the noble Baroness, Lady Jones.

Drones: Code of Conduct

Lord Tunnicliffe Excerpts

Tuesday 25th June 2013 Lords Chamber

[Lord Tunnicliffe]

My Lords, I thank the noble Lord, Lord Judd, for tabling this debate. I wish that more noble Lords had taken part to discuss this important issue. I also thank the Library for its extremely useful briefing note. I agree with much of what the noble Lord, Lord Judd, has said, but at the beginning I must state categorically that we on these Benches believe that unmanned aerial vehicles are a good thing, particularly in the military environment, and that by a “good thing” we mean that we believe that their value-added exceeds their risks. We agree with the noble Lord that appropriate controls over their use are essential.

In essence, the noble Lord’s question is this: do we need a code of conduct, along with regulations for the manufacture of and the operation of drones, and should these be international? I shall touch as quickly as I can on three areas, the first of which is safety. The operation of drones in UK airspace raises three areas of concern: collision; what we might call “terrain strike”, where drones fly into buildings and so on; and the possibility of technical catastrophe. Noble Lords will know that their computers are of a generation that is more adolescent than mature: that is, they are brilliant but they fail frequently. All these possibilities generate risk in the air environment, and any code of conduct or process of operation in UK airspace must cover all these risks. The risks are a particularly difficult regulatory challenge because drones do not have an established position in UK airspace at the moment, and therefore safety could be assured by simply denying them access. That makes it even more important that we understand the value that drones provide, the risks that they present, and that there are appropriate procedures to mitigate those risks.

What is the value of UAVs? The answer can be divided into two parts, the first of which is what I would call observation, and the other is the military delivery of lethal force. Observation can be secured by manned platforms: helicopters and fixed-wing aeroplanes. What is special about the drone in this observational area and what are the new challenges? I contend that the potential for drones to be both cheap and small introduces a new series of challenges for society as a whole. Because drones are potentially cheap and small, they have the potential to be both numerous and covert. The military use of drones for observation and reconnaissance is unexceptionable. Armies, navies and air forces throughout history have used all reasonable methods to secure information about their enemies, and I believe that drones are but part of that suite of capability. I do not believe that the military use of drones in the observation and reconnaissance role is particularly contentious.

However, in the non-military role, the potential for problems emerges, and we should address it. The non-military role divides into two: the state and the private sector. In the state sector, there is the potential for observational roles for the security services, the police and some other services. As the briefing note points out, we have some legal protections in the police and perhaps some in the security services, but by no means are they comprehensive, so one of the areas that has to be addressed is that of the whole suite of law covering operations that the state must obey in the use of this new technology.

In the private use of drones, one can certainly see the potential for them developing the inspection of hazardous environments and so on, but the area of most concern to me is that of intrusion. The fact that it is probably technologically feasible within a relatively small number of years to have an affordable drone the size of an apple that has a high-resolution camera in it means that there is a whole new potential for intrusion in the private environment. We know that our present laws are ineffective on intrusion by the press, and we are at the moment agonising over that with respect to Leveson. Surely, this new area must be included in those concerns to make sure that the whole issue of privacy is considered when developing the codes of conduct for these things.

The final and most contentious area is the use of drones for the delivery of lethal force. They are very effective in this role in uncontested airspace. They are able to deliver force with great precision and are therefore better than many other weapons that have defended us in the past: they are not indiscriminate like cluster bombs, mines or even modern artillery. They have the ability to loiter and be persistent, which allows for high precision, smaller munitions and the potential for less collateral damage. They also eliminate operator exposure.

The regime for their use essentially uses the manned platform regime, which involves military advisers in all aspects, including targeting and compliance with international law; there is a human decision-maker. As far as we know, society is not contemplating autonomous use. All those things are there. However, it is this very precision that causes us to think about the drone and that brings home to us that it is about damaging the enemy and killing them. Very usefully, the pack refers us back to Robert E Lee’s statement:

“It is well that war is so terrible—otherwise we would grow too fond of it”.

If war has no risk to the aggressor, how do we ensure that we do not become too fond of it? We must retain the horror of war itself. As the note points out, it is the remote warrior that is at the centre of this whole dilemma. The retention of the remote warrior as the stepping stone, the filter, and the way in which the state’s use of lethal force is used is absolutely crucial. We certainly, as I have said, see no movement towards autonomous use.

We need codes for the use of drones and the use of lethal force, which need to be bigger and probably more effective than those we have now. They should be developed through a transparent process, even in respect of military use, so that society knows how lethal force is being delivered and that appropriate, politically accountable systems ensure that this frightening delivery of lethal force by our remote warrior is properly controlled. We agree that there is a need to look at new controls and that, where possible, these should be developed internationally. We believe that they should pass the test of the public having confidence that the operation of drones in UK airspace will be safe, that their use in non-military applications will preserve our privacy and that their military use will ensure the protection of national security and the value system of our society.

Arrangement of Business

Lord Tunnicliffe Excerpts

Monday 12th December 2011 Grand Committee

[Lord Foulkes of Cumnock]

My Lords, what is happening in the Chamber is fairly open-ended. If we adjourn, by the time the Statement and all the interventions are finished it could be quite late. A number of noble Lords wish to speak in this Committee and it could drag on and on. It might create problems for the Grand Committee in terms of the time we are able to meet. I counsel us to continue.

[Lord Tunnicliffe]

My Lords, perhaps I may suggest a compromise—that we proceed with the debate and adjourn when the Statement is notified.

Equality Act 2010 (Work on Ships and Hovercraft) Regulations 2011

Lord Tunnicliffe Excerpts

Monday 27th June 2011 Grand Committee

[Lord Lester of Herne Hill]

First, I apologise for saying “shipbuilding industry”, which is of course not what was intended at all; one is concerned with the shipping industry. Secondly, my noble friend is perfectly right that we are concerned with racial discrimination in pay and nothing else, which is preserved by these regulations. It is that and nothing else which Susan Carter of the external panel was considering in her careful review of stakeholder evidence on differential pay in the shipping industry, where she goes through the consequences of outlawing differential pay on five types of ship based on a Chamber of Shipping survey of its members. She looks at 229 ships and estimates what may happen about change of flag and so on. I have been quoting from her report. I submit that, being an external reviewer who has looked at all the evidence, her report should be given careful consideration. I respectfully agree with the report and wish that the Department for Transport would follow the wise and objective advice of the external panel instead of creating considerable legal uncertainty and continuing unfairness which our courts and employment tribunals may have to resolve. That may be to the benefit of my profession, but it is not in the public interest. I wish that the Government had taken the advice of their own external reviewer and I hope that these points can be considered before we come to the debate to approve the regulations.

[Lord Tunnicliffe]

My Lords, I thank the Minister for his explanation of these regulations and other noble Lords for their thoughts. The point of the noble Lord, Lord Lester, is well made. The regulations will leave an unsatisfactory piece of law on our statute book. They will regularise discrimination by nationality on British vessels. There are no two ways about that: they are designed to do so. They are designed to be compatible with European law and, for appropriate individuals, with UK law, and are designed to except those who are not in the protected group: some 12,700 overseas seamen.

Option 2 in the impact assessment simply says that it is option 1, but also makes it unlawful for employers to pay seafarers differential rates of pay on the basis of their nationality. The argument against it is made by the Chamber of Shipping, and it is the argument that the Government seem to have accepted. It goes something like this: if we make discrimination illegal, our costs will go up, so we will deflag and that will be bad for the economy.

We are not going to oppose the regulations because we think it is better to get the first bit right, which is the option in front of us, and perhaps debate later the second bit, which is whether all seamen should be involved. But I am concerned that the report by Susan Carter, from which we have had extensive quotes from the noble Lord, Lord Lester, seems to have been ignored in the regulations, the memorandum and the impact statement. She makes a basic statement:

“On the basis of the evidence submitted, I recommend outlawing the practice of nationality-based pay differentials for seafarers altogether”.

So I hope that the noble Earl will respond to the noble Lord, Lord Lester, and myself on why this report was ignored before this goes in front of the House.

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[Earl Attlee]

I am obliged to the noble Lord.

The aim is to apply the regulations to as many ships as possible of whatever flag, in so far as this is consistent with international law, to limit the effects being felt by the UK flag alone. The extension of the application of Part 5 to EEA ships is therefore limited to those protected characteristics which are underpinned by EU law. A ship flagged to EEA states would be under the same obligations. The characteristic of marriage and civil partnership is not an EU obligation and so is excluded.

My noble friend Lord Higgins made several important points. I accept his points about the importance of the UK register, and I hope that that came out in my comments. On the effect on the UK flag, leaving aside the issue of differential pay for the moment, the effect of applying the new consolidated equality legislation to work on ships is not very burdensome. Indeed, it should bring benefits through greater clarity for employers and employees.

As to the effect caused by the need to change the law in respect of seafarers’ pay, we cannot say with absolute certainty what the effect will be on the UK-flagged fleet, although many noble Lords have suggested what it could be. We have consulted closely with all sides of the shipping industry on the likely effect and will monitor it closely. We are regulating in a way that will be least disruptive to the industry while allowing it to comply with EU law. We are also seeking undertakings from the European Commission that it will be vigilant in ensuring that other EU member states are also following EU law.

My noble friend Lord Higgins asked me about the review provided for in the regulations, and asked whether we would review earlier. As I indicated in my opening remarks, we will keep the implementation and the situation under close observation.

My noble friend Lord Moynihan asked me why the regulations did not appear to apply to Northern Ireland. Northern Ireland has been asked to introduce its own parallel legislation at the earliest opportunity. Until that legislation is also approved, the UK will remain in breach of EU law. The European Commission has been informed that action in Northern Ireland was necessarily delayed due to recent elections, but that the matter is in hand. My noble friend also asked me a rather detailed question about the definition of “sufficiently close link”. It is a basket of measures as set out in Regulation 2(2)(b). It will be determined by reference to all relevant factors including those set out in the regulations.

Noble Lords asked me particularly about the Carter report. I agree that it is a significant report. Susan Carter reviewed all of the evidence submitted by stakeholders and came to the conclusion that she did. She was not asked to consider any other evidence, such as that from government. Maybe Susan Carter’s report was a comment on the industry’s evidence to maintain the status quo. As I have already indicated, my honourable friend Mr Penning, the Shipping Minister, has consulted extensively.

I am grateful to all noble Lords for their contributions. The wider issues are indeed complex. As indicated, I will write to all noble Lords who have contributed to the debate.

[Lord Tunnicliffe]

Will the noble Earl write specifically on the consideration that the department has given to Susan Carter’s report and say why it does not share her conclusion? He seems to give a partial explanation which I do not think is valid. Susan Carter consulted as widely for her report as the department has for the regulations.

[Lord Lester of Herne Hill]

While the noble Earl is dealing with that, I should add that Ms Carter states at the beginning of her report:

“This report reviews evidence submitted by key stakeholders in the shipping industry about differential pay for seafarers on grounds of nationality. The Department for Transport invited them to submit financial estimates of the likely impact of either: option A … or option B”.

That the department did not give evidence is, with respect, not the point; the point is that the department asked her to do this job on the basis of evidence submitted by—that ghastly phrase—“key stakeholders”. Therefore, I am mystified as to how anyone reading her report could fault her findings or her conclusion. I would be very grateful if the Minister would write to us about that as well.

Railways: Public Procurement

Lord Tunnicliffe Excerpts

Tuesday 30th November 2010 Grand Committee

[Lord Tunnicliffe]

My Lords, I thank the Minister for indulging my short absence. I also thank the noble Baroness, Lady Greengross, for introducing this debate and for sharing with me the paper from her transport forum. It reminded me of a paper that I had written some seven years ago, after 12 years’ experience of procuring goods and services for the public. I was procuring at the rate of something like £0.5 billion worth a year and I set down in a paper—it was literally only 22 lines long, so it was not a great seller—what I thought I had learnt from those 12 years. I ended up with 22 tips for contracting. I have looked at where the two papers coincided.

I take my first two points:

“Know what your objectives are”,

and, “Understand your suppliers’ objectives”. The essence of making a good contract is to think first of why you are doing it. You are doing it not for the Government but for the citizens, either singly or in groups, so you must know what you want and what that service is. You must have mutually compatible objectives and you really need measurable objectives. You do not want indulgences such as, “Let’s have innovation”, or all those fancy words. Get your objectives right first and understand your suppliers’ objectives so that they know whether those are possible.

I come now to contracts, which were at 11 and 12 on my list. I wrote,

“Contracts beyond their foreseen limits become progressively valueless”,

and, at point 12, “You cannot subcontract responsibility”. Because of those two facts, the idea that you can take contracts, litigate them and bring the behaviour of your contractor into line is pretty thin. My experience is that once you have a contract so far out of line that you cannot do business with your contractor, it is useless to try and litigate it and that, because you cannot subcontract your responsibility to operate the service, you are forced into a deadly embrace with your contractor. Much better than depending on tight contracts with penalty clauses is to have win-win contracts. In a good win-win contract, when a contractor’s manager thinks about making a decision to maximise the profit for his employer, he should be thinking, “That same action will maximise the benefit to the citizen”. Contracts that have those win-win characteristics are the only ones that really work over time, so win-win contracts with good mutual alignment are best.

My points 15 and 16 were:

“Risk migrates to the party of substance”,

and,

“Risk transfer should be appropriate”.

This idea that you can somehow subcontract risk to the private sector is unreal. When things go wrong, the risk will come back to the state. The reason that the state provides this service in the first place is that it has to be provided and the state cannot back out. You can only transfer to your contractor the risks that he can manage. You should not try to transfer risks that he cannot manage because, if you do, your contractor will then be a gambler. If he is lucky, he will make a fortune but, if he is unlucky, you will pick up the pain. We should remember that the private sector is risk-averse.

Point 21 on my list is that the private sector is good at focus and continuous improvement. Therefore, I allowed the private sector an important role here. However, as I wrote carefully on my piece of paper as point 22, the private sector becomes increasingly dysfunctional in loss-making situations or, as I said in discussions with colleagues at the time, the private sector runs around like a headless chicken. If your supplier is not making profits, all the nice things that he said in the contract and during the negotiations—all the cuddly and furry bits round the edge of what he promised to do—will evaporate. Private sector companies cannot survive without making a profit, so it is in your interests to make sure that you think through how they are going to provide the service and make a profit.

The one area in the report which I missed out but which I think is very valid is transparency. I certainly believe that we have had too much talk of commercial confidentiality over the years and that far more openness and open-book policies in contracting would benefit both sides so that all parties, including citizens’ representatives and the citizens themselves, could see what was happening on their behalf. Therefore, I strongly support the idea of far more transparency, including during the contracting and bidding periods.

Returning to the question of the railway contracts, I ask the Minister, first, whether we have clear criteria by which future franchise renewals will be judged. Do we have criteria by which to create the invitation to tender? Are those criteria written down? If so, where are they and, if not, will they be written down?

Secondly, do the Government understand the importance of win-win contracts as the only contracts that really work over time? Finally, do the Minister and the Government understand the whole issue of risk transfer and how it must be appropriate so that the public and the state do not become the losers?