Infrastructure Bill [Lords]

Debate between Mike Weir and Sheila Gilmore

Monday 8th December 2014 Commons Chamber

[Mr Mike Weir (Angus) (SNP)]

This Bill covers a wide range of topics, some of which do not affect Scotland, but those that relate to energy most certainly do, and it is those areas on which I shall concentrate my remarks.

Part 4 of the Bill opens with provisions relating to community energy. By and large, we support the efforts to allow communities or community groups to buy a stake in renewable energy facilities in or close offshore to their communities.

I hope that those provisions will lead to more communities taking a stake in such important facilities—indeed, some community organisations are already making efforts to raise funds to invest in local renewable energy—and to greater involvement and acceptance of renewable generation. Should the Bill succeed, I hope it will lead to alternative visions of how we deal with off-gas grid properties, which are so often left out of the thinking on energy costs and energy efficiency.

I also hope that more community involvement will encourage energy companies to consider the wider interests of the community when proposing new developments, such as encouraging economic regeneration by supporting other businesses or by looking at ways in which they can help to deliver better broadband services to allow businesses to prosper.

I also note that amendments are proposed to the Petroleum Act 1998 that are designed to implement the recommendations of the Wood review to maximise offshore oil and gas extraction. I would disagree strongly with the Minister on what should be done with oil and gas revenue, but we are inclined to support the relevant parts of the Bill because both the Scottish Government and the UK Government strongly endorsed the Wood review.

Unfortunately, there are other aspects of the Bill with which we do not agree. New clauses were introduced in the other place relating to the process of hydraulic fracking. I have raised my concerns and asked specific questions on this matter at least twice in this House but have yet to have a clear answer, so I will try again—third time lucky, but I am not holding my breath.

In his introduction to the debate the Minister said that oil and gas was a reserved matter. That is true, but, unfortunately, the clauses on fracking cut across Scottish land law as well, which is very much a devolved matter. Given that the Smith commission proposed the devolution of those proposals to Scotland, it strikes me that now is the right time to do that. We should get all these provisions in one place while fracking is still at a very early stage. If we do not do that, it will be much more difficult to deal with it at a later stage. I should make it clear at the outset that I do not support fracking. Although we have heard much about its potential, I note that even in Denton, Texas, the very home of fracking, a recent referendum voted to end it. Other states in the US are turning against it because of environmental concerns. We should take note of such concerns, because if there are concerns about the impact of fracking in the wide open spaces of the American west, how many more would there be in densely populated islands such as these?

I wish to concentrate today on some specific questions relating to the process of fracking. Although development is at an early stage in Scotland, it is already causing a great deal of public concern. A large area of central Scotland, stretching through to my own constituency in Angus, has been identified as having potential for shale gas extraction. Much of the power over such developments lies with the Westminster Government rather than the Scottish Parliament. Westminster has the power to grant licences under the Petroleum Act to search for and develop shale gas, while local authorities and the Scottish Parliament have powers in respect of planning, which clearly give them some powers to restrict fracking. In his opening statement, the shadow Minister made the point that the Scottish Government have not introduced a moratorium. My understanding is that it is very difficult to do that, because planning is initially carried out at local authority level, and any such moratorium or attempt to put in standard conditions would lead to judicial review and endless litigation. It would be much simpler if all the powers relating to fracking were in one place. In that instance, the Scottish Government could take action by refusing the licences.

[Sheila Gilmore (Edinburgh East) (Lab)]

I am pleased to hear the hon. Gentleman say that he agrees with the Smith commission’s proposals, as I do. Does he accept that the Scottish Government could, if they wished, issue planning guidance that would prevent fracking, as they have in relation to nuclear power?

[Mr Weir]

My simple answer is no. If the hon. Lady had listened, she would have heard me say that nuclear is completely different. Section 36 of the Electricity Act 1989 gave the powers directly to Scottish Ministers, so the situation is not the same.

The UK Government seem determined to have fracking. The changes proposed by the Bill remove the right of landowners to object to fracking under their properties. It has been reported that the UK Government are funding the British Geological Survey to carry out investigative boreholes to demonstrate the viability of fracking. Will the Minister confirm whether that is true?

Interestingly, the Chancellor of the Exchequer proposed in his autumn statement last week to give, in effect, a sovereign wealth fund for fracking to north-east England. I note that, for many years, he refused even to consider such a thing for Scotland’s oil and gas. That has not gone unnoticed in Scotland.

As well as giving the right to grant licences to persons seeking to explore for shale oil, the Petroleum Act provides, in section 7:

“Subject to the provisions of this section, the Mines (Working Facilities and Support) Act 1966 shall apply (in England and Wales and Scotland) for the purpose of enabling a person holding a licence under this Part of this Act to acquire such ancillary rights as may be required for the exercise of the rights granted by the licence.”

The 1966 Act includes the right to

“enter upon land and to sink boreholes in the land for the purpose of searching for and getting petroleum”

and to use the land for such specific purposes as erecting buildings and laying pipes, and ancillary rights. The right hon. Member for Arundel and South Downs (Nick Herbert) made the point that there is no right to enter on to land—there is no such right in the Bill, but there is in the 1966 Act. The definition of petroleum in the Petroleum Act includes natural gas. There is a right in other regulations under which people can enter on to land. The ancillary rights laid down cover such rights as lowering the surface, the conveyance of gas or oil, and the right to occupy the surface of the property, among other things.

That illustrates the confusion and difficulty resulting from planning law, the Bill and the 1998 Act. Those are extensive rights for the licence holder. Rightly, under the 1966 Act, those ancillary rights need to be set out by a court if agreement cannot be reached with the landowner. That right is being taken away by the Bill. No longer would that disagreement have to go before a court—those doing the fracking will have an automatic right to frack.

I am not clear where planning law is involved in fracking. If someone has a UK Government lease to seek shale gas in a specific part of Angus, would they be entitled to go on to ground to do so even if the landowner objected? Do those rights override planning permission, or would people still need planning permission from the local authority? If so, where does the landowner stand? Is his only right to object to the planning permission?

There is a further difficulty. In any event, the planning process could cover only the area in which there is infrastructure for boring, but it will be very difficult to be sure where or how far any drilling into adjoining land will go until such time as the operation gets under way. Planning permission will not cover that. At most, it will cover the infrastructure for starting the bore. What happens once the hole is bored? What happens when the bore follows the gas deposits? No one knows where it will go once it has started. That is the difficulty.

The Scottish Government have powers over planning in Scotland and have taken a much more cautious approach to fracking than the UK Government have taken. They have called in the application from Dart Energy in Falkirk, and have introduced changes in planning guidelines for unconventional oil and gas. Another Member has made the point that the Scottish Government have confirmed that, for the first time, the concept of buffer zones should be applied to all proposals. They have asked for the additional requirement to prepare risk assessments to ensure a transparent and evidence-based approach for assessing the acceptability of proposed buffer zones. They have made it explicit that buffer zones will be assessed by the planning authority and statutory consultees, with a strong expectation that planning permission will be refused if they are unacceptable. They have ensured that operators are up front about their plans, and that communities are consulted on all unconventional gas developments, including close involvement in the risk assessment process. As an Opposition Member said, the Scottish Government require a fresh planning application and public consultation if permission had not been sought for hydraulic fracturing but developers subsequently intended to undertake the process. As the hon. Member for Fylde (Mark Menzies) has said, the Scottish Government have also convened an expert scientific panel to review the scientific evidence on fracking.

I believe that all powers relating to fracking, and indeed everything else, should be moved from Westminster to the Scottish Parliament. The Smith commission recommended that powers over onshore oil and gas should be transferred to the Scottish Parliament. The political parties in Scotland agree on that, at least. It would be right and proper if all aspects, including planning and licensing, were dealt with in Scotland. That would reflect the views of the communities of Scotland where fracking might take place.

As I have said, fracking is at an early stage. Now is the time to transfer those powers. If we do not transfer the powers now, and if we wait until a Bill is prepared in the next Parliament after a general election, the transfer of the powers will, with the best will in the world, be at least a year down the line. A lot can happen in fracking in a year. We have the opportunity to have a proper look and ensure we do it right from the beginning, rather than transfer the powers in the middle of the process when it could be too late to stop some of those developments.

Fairness and Inequality

Debate between Mike Weir and Sheila Gilmore

Tuesday 11th February 2014 Commons Chamber

[Mr Weir]

I have never heard of that one; perhaps the hon. Gentleman should ask the doctors why they are doing that. We have made it clear that free prescriptions are an important policy for pensioners throughout Scotland. Too often, pensioners and those with multiple prescriptions had to choose whether to buy their prescription or eat, and they do not have to make that choice any more. This is a really progressive policy, despite what his leader may say.

We are investing in skills, training and education for our young people to make sure that they all have an opportunity in life. I recently visited the Angus training group in my constituency, where tremendous work is being done to train youngsters who are leaving school and have got apprenticeships in engineering. While the Chancellor may talk about the march of the makers, we are making sure that that actually happens and there is power behind it. We are protecting the education maintenance allowance for 16 and 19-year-olds while the Westminster Government have scrapped it. These are just a few of the things that we have already done.

We are committed to ensuring, where we can, that people get paid a decent wage. Since 2011-12, the SNP Government have paid all staff covered by Scottish Government pay policy a living wage, and that includes NHS staff. No compulsory redundancy policy has been in place since 2007, helping to protect about 10,000 jobs a year. We are funding the Poverty Alliance to deliver the living wage accreditation scheme to promote the living wage and increase the number of private companies that pay it.

We have done a lot to deal with inequality in Scotland, but what holds us back so much is the fact that the Scottish Parliament has to depend on and fit within a block grant determined by Westminster that has been steadily cut in the past few years. The Chancellor has said that another £25 billion of cuts is coming round the corner, so we can only imagine what will happen to the Scottish block grant in that event.

[Sheila Gilmore]

The hon. Gentleman made a great deal of issues such as free personal care. Does he not accept that there are still major problems in Scotland, and if we do not address them but simply say, “We’ve cracked it, we’ve solved it”, we are not helping the people who give and who need care? When care workers have very poor conditions and people are getting 15-minute visits, if that, we have not really solved the problems. Should we not be talking about them instead of being so complacent about somehow having solved them all?

[Mr Weir]

I cannot believe what I am hearing from the hon. Lady. What I said is that the Scottish Government have taken action on and invested money in those matters. We have not claimed that we have solved every problem under the sun—we cannot possibly do that—but what we have said is that we have done all we can with the powers we have and that with the powers of independence we will be able to do so much more.

Energy Company Charges

Debate between Mike Weir and Sheila Gilmore

Tuesday 4th February 2014 Commons Chamber

[Mr Mike Weir (Angus) (SNP)]

I congratulate the hon. Member for Harlow (Robert Halfon) on securing the debate and on amassing such an impressive number of supporters. I also congratulate the Backbench Business Committee on securing the time for the debate.

All our constituents have suffered from rocketing energy prices over the last few years. Hard as that is for everyone, it is harder still for those who are unable to access the special deals that are offered by just about all the energy companies. In passing, however, I note that it is not all plain sailing for those who sign up to pay by direct debit, which can involve either a quarterly bill payment or paying a set amount per month. Those who take the quarterly bill payment option do not necessarily have any control over the amount being taken from their bank account, especially if they are out a lot and regularly have estimated bills. That can be a real problem. For those who opt to pay a set amount per month by direct debit, the company will regularly try to increase the amount they pay, whether or not the current amount covers their bills. Any attempt to retrieve an overpayment can result in a long tussle. At any given time, the energy companies are sitting on substantial sums that have been overpaid by customers. These are estimated to be about £2 billion, earning the companies £36 million a year in interest. It is hardly surprising that they keep trying to up the level of people’s direct debits.

Matters are not helped by the fact that energy companies are often not transparent about the charges that will actually be applied. The hon. Member for Makerfield (Yvonne Fovargue) mentioned the fact that many people on prepayment meters did not know what tariff they were on. In recent price rises we were told the average, but that hides a multitude of sins. A constituent, a low energy user, contacted me yesterday regarding the charges levied on his flat. He told me that the unit charge had risen from 7.242p to 10.89p—a rise of some 50%. That is outrageous.

The crux of the debate is not so much energy prices as social exclusion. Gratifying as it is to give the big six energy companies a well deserved kick, we also need to examine the actions taken by many of our major financial institutions and how they work against people accessing cheaper energy deals. The Minister may be able to do something about energy companies and Ofgem, but we need a cross-governmental effort to look also at how people access finance and bank accounts. The major energy companies all offer better deals if people can pay for their energy by direct debit; Citizens Advice reckons that the average saving is £100 on that paid by people who pay by other methods, although it can be as high as £140. That is great for people who are able to pay by direct debit, but many of those most in need of cheaper energy are the very people unable to pay by direct debit. There can be many reasons for that. Banking exclusion is one such reason, because about 1 million people do not have a bank account. We have all seen in recent years the flight of the banks from rural areas and areas of deprivation, and just the other week many branch closures were announced.

[Sheila Gilmore]

I am sure the hon. Gentleman is aware of this, but I would like him to comment on it. Many big banks have retreated from things such as basic bank accounts—Barclays is the only one of the major banks still to offer that—so in the past few years things have gone backwards on banking inclusion.

[Mr Weir]

The hon. Lady is right about that, and I will deal with the matter in a moment.

Another reason is digital exclusion, because many people do not or cannot access the internet, perhaps because they cannot afford it or they are unable to work a computer because of illness or age. Other people are simply disengaged from any competitive initiatives. Some may lead chaotic lives, whereas others may simply live in privately rented accommodation and move frequently to seek employment, and, thus, cannot enter into the longer-term agreements demanded by many of the direct debit arrangements.

Today’s debate pack contains an interesting table detailing the percentage of people who pay by direct debit. The figure for the south-east is 63% and the one for my area of north Scotland is 56%. Surprisingly, London’s figure, 41%, is one of the lowest, but that is because of the transient nature of London’s population and the fact that it contains a huge number of houses in multiple occupation and young people living in them. Those things push the figure down.

Some people are simply wary of getting into debt, especially if they have previously had problems, and they do not want to get into the position where they cannot control exactly when money comes out of their accounts and have to juggle their income to ensure that all bills are met. The availability of direct debit arrangements further discriminates against such consumers.

Let me directly address the point made by the hon. Member for Edinburgh East (Sheila Gilmore). Anyone who cares to look at banking comparison sites such as MoneySuperMarket.com or money.co.uk will find that data on best buy basic bank accounts show that some managed accounts with niche suppliers, which are supposedly specifically designed to help people with poor credit histories budget, have substantial monthly fees of about £12 to £14; those come up first if people google “basic bank accounts”. By contrast, some of us still, at least for the moment, enjoy free banking, as well as being able to get direct debit payments on our energy. It is also illuminating to look at the discussion forums on some of these sites and at the threads on basic bank accounts. It is apparent that the big banks, some of which still offer basic bank accounts without a fee, try to place people who inquire about basic bank accounts on their basic current accounts, which allow the very overdrafts that many of those seeking basic bank accounts seek to avoid. Such accounts can also sometimes come with swingeing penalties should the limit be exceeded.

In addition, people may find that the payment card for their basic bank account works only in certain automated teller machines. That makes things difficult, particularly in rural areas, where there may be only one ATM; if it does not happen to be the right one, people cannot access their money. Many people who have had difficulties with banks in the past are also wary of opening basic bank accounts with the same banking group, as they have real concerns that the money that goes into them might be swiped by the banks to clear pre-existing debts. All of that works against taking advantage of direct debit deals.

The situation is even worse for people who are on prepayment meters. As I have said before, this is one of the rare examples where people are actually penalised for paying in cash up front. Not only can they not access special deals, but the tariff is often higher. Many people who rent privately have no option, as private landlords have often installed prepayment meters. Worse still, when meters are calibrated to recover existing debt, much of the money is taken before energy is provided.

Those are just a few of the many issues around energy prices. For many people, the advice from successive Governments to switch suppliers or to pay by direct debit simply does not work. I accept that there are additional costs in different types of payments, but the huge disparity in charges shows that the current system is not working. We need real action on the matter and a fairer and transparent charging system. The motion calls for a cap on charges, which is very reasonable. I appreciate that the problem is not all down to the Department of Energy and Climate Change. As I said earlier, I hope that there will be a cross-governmental effort to deal with the problem.