(5 years, 9 months ago)
Commons ChamberThe hon. Lady cares deeply for her constituents, and so do I. On the intricacies of devolved government in Northern Ireland, the relevance to my Department is that it makes it more difficult for us to communicate. We have to communicate directly with companies, which is a pleasure, but it is important that we ensure a democratic element to the process as well. We do all we can, however, and have to make the best of the situation. There is certainly no lack of effort or will from my Department. We want more skilled jobs in Northern Ireland, and Bombardier is very much a part of that, so we are not writing the company off because of these redundancies, although I accept that they are significant and a serious issue for her constituents.
More than 30% of the Bombardier workforce has been cut since 2015. In my experience working with Scottish Enterprise, first-tier aerospace companies, particularly Bombardier, have quite a shallow penetration into second and third-tier supply chain companies in the UK. Will the Minister redouble his efforts and ensure a proper industrial strategy that maximises the inputs from first-tier companies such as Bombardier into second and third-tier companies so that we can mop up some of the jobs that have been lost?
I cannot speak for the hon. Gentleman’s experience in his constituency, but it is my impression, from my dealings with Bombardier and other companies in the Northern Ireland cluster, that they are well integrated and co-ordinated with each other. He asks me to redouble my efforts, however, and I certainly will do. I will bear in mind his point in every visit I make and every conversation I have.
(5 years, 9 months ago)
Commons ChamberThe hon. Lady should finally recognise that the economic crisis—the crash—was caused by casino capitalism and reckless bankers, and the Conservative party chose to make the poorest people pay for it, and they continue to pay, given the slowest recovery since the Napoleonic era.
Does my hon. Friend agree that the economy was growing and national debt was below 50% when Labour left Government? Debt has grown to 85% under this Government because of their failed austerity programme. Indeed, when we built the NHS in 1948, debt was 250% of GDP, but it dropped because we invested in the economy.
My hon. Friend is absolutely right. He could give a lesson in basic economics to most Conservative Members.
It is a pleasure to follow my hon. Friend the Member for Bristol North West (Darren Jones) and to share in his delight that Glasgow is to be the home of the other Channel Four creative hub—a great triumph for a city that has built an incredible reputation for communications and broadcasting over the past 50 years, as the home of BBC Scotland and STV. I am sure it will help to bring a far greater breadth of expression to public service broadcasting, particularly from working-class voices, which are too often shut out of mainstream media in this country. That is a great opportunity for us all.
I reflect on the past 10 years—I started university in 2008, the same year that Northern Rock collapsed and the banking crisis erupted on this country—and the impact that that had on my generation, in our formative years. I think of the efforts that the British Government made at that time to command the global response, to ensure that the G20 responded with a counter-cyclical growth strategy, and to introduce stimulus that returned the UK economy to growth in record time. That was the picture when the Labour Government left office in 2010, to be succeeded by a Tory-led coalition, which rapidly imposed a programme of austerity on this country, claiming that there was no alternative.
Well, the alternative has been proven to have failed, and this Budget is testimony to that failure. It has failed our public finances. The Tories have missed every target they set themselves for fiscal recovery. They were meant to eliminate the deficit by 2015, but the Office for Budget Responsibility described achieving that by 2025 as a “challenging” objective. If they succeed, it will be by shifting the deficit on to the balance sheets of our underfunded schools, hospitals, local councils, police forces and other public services across the country. The Tories will have handed out £110 billion in corporate tax giveaways by the end of this Parliament. Choosing tax giveaways for the few over public services for the many is unjust, and certainly irresponsible.
Austerity has failed our economy. Average growth between 1945 and 2009 was 2.4%; between 2010 and 2016 it was just 2% and it is not forecast to rise above 1.6% for any of the next five years. That is a failure in the growth opportunity of this country, and it is a failure of my generation, who have been betrayed by the economically illiterate policy of austerity that has been visited on this country.
Think of the lost opportunity, Mr Deputy Speaker. Millions of young people across this country have been betrayed by that lost opportunity. For the first time, we expect my generation to be poorer than our own parents. That is simply a shameful indictment of this Government’s failure to deliver investment in this country. Indeed, real wage growth between 1946 and 2010 was 2.4% every year, on average, but between 2010 and 2018 pay has actually fallen in this country, by 3%. That means that 6 million people earn less than the real living wage. When this Government boast of record employment levels in this country, we have to reflect that, actually, coming up to half of the workers in this country are on less than £13,000 a year. That is a low-wage economy of penury, imposed by this Government, who have utterly failed to deliver for working-class people. It is shameful.
The UK is the only major economy in which investment is falling. UK business investment is the lowest in the G7, and public sector investment is over £18 billion lower today than in 2010. That is the root cause of the problem. We are using low wages to subsidise industry, not investing in high productivity that will deliver the real economic benefits for everyone in this country. That is why British productivity remains 15% lower than that of the other major economies. There is a vicious cycle of economic decline under this Government. By contrast, our party’s policies propose a virtuous cycle of recovery that will improve lives for everyone. We were on that growth trajectory when we left office last time.
I would particularly like to reflect on the impact in Scotland. We have heard about £959 million in Barnett consequentials, but that is a drop in the ocean relative to what is necessary to truly transform the Scottish economy. It is a drop in the ocean relative to the £33 billion budget that the Scottish Government manage. It also pales into insignificance beside the £70 billion programme of investment that Labour proposes to bring about in Scotland over the next 10 years. That would be the radical transformation that is really required in the Scottish economy. We have seen efforts to invest in Belfast, with attempts to regenerate the city in the wake of a devastating fire, yet nothing from this Government after the devastating Glasgow School of Art fire.
Universal credit is about to roll out in my constituency, where I will have the highest number of universal credit claimants in Scotland—over 16,000. We have seen no effort to address the huge shortfall of over £7 billion of welfare cuts that this Government have made. That is the reality of Tory austerity in this country.
(5 years, 10 months ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) on securing the debate and making a powerful speech to introduce the complex but dramatic and distressing situation of green deal mis-selling and the impact of HELMS in particular.
I was elected last year by a community that I have grown up and lived in my whole life. Balornock is probably similar in many ways to Linwood in the hon. Gentleman’s constituency: it was an overspill estate created after the second world war, built at a time of great optimism in the Glasgow city region, where people were moving out of overcrowded slum tenements in the inner city and into what they saw as new build housing, with indoor toilets and front and back gardens. The community was largely born of the baby boomer generation, who moved in and have lived there their whole lives. Many benefited, as they saw it, from buying their council houses in the 1980s and 1990s, and, as they reached retirement, they wanted to make improvements to their houses.
The community was built out of great optimism and aspiration for the future. Five years ago, the green deal was launched to great fanfare by the Tory Government, with the promise of a win-win situation for homeowners: lower energy bills and the chance to do their bit for the environment. It seemed like a great idea. Those who sought to exploit that scheme cynically homed in and targeted communities, particular those with a large population of baby boomers in self-contained housing units—not flatted accommodation—with back and front gardens. If the scheme sounded too good to be true, that was because for some in those communities it turned out to be exactly that.
Dozens of my constituents in Glasgow signed up to install green deal-financed improvements to their homes, such as solar panels and insulated cladding, but that has proven to be one of the worst decisions they have ever made. Instead of realising the Government’s vision of a flagship programme to reduce fuel poverty and improve energy efficiency, the complete failure to regulate the scheme properly has allowed it to be ruthlessly exploited by gangsters and other rogue traders, who have systematically preyed on trusting people who thought that, as the scheme was approved and accredited by the Government, they could trust its credentials and sign up.
In 2015 Christine McBain, one of my constituents, handed over her life’s savings to a Cambuslang-based green deal provider called Home Energy and Lifestyle Management Systems—otherwise known as HELMS—to put external wall insulation on her Swedish timber-framed house in Balornock. Those houses are a common feature of Balornock, because after the second world war the overspill in Glasgow was so problematic that timber kit houses were imported from Scandinavia, such was the pressure on housing. More than half a century later, those houses are not the most energy-efficient, so this offer seemed like a plausible way for those homeowners to make them better. As I have said, it turned out to be the worst decision they ever made.
Another constituent, 86-year-old Mary, handed over her lifetime’s savings and has been left with £17,000 of debt after being duped by HELMS with no sign of any redress. It is the most appalling experience as an MP to see people who are meant to be enjoying their retirement, and feeling safe in their life’s work and savings, but who have been stripped of any sense of security and are in absolute distress about what they are having to deal with. If this is not dealt with urgently, sadly they will have to deal with it for the remainder of their lives. That is a shameful indictment on the Government’s failure to regulate their policy.
Christine and Mary are among many local residents in my constituency who have been left totally in limbo by HELMS. The company carried out similar works on more than 160 properties in my constituency without obtaining the necessary building warrants, cynically preying on local residents with promises of free solar panels and cavity wall insulation that would save them thousands of pounds. Normally such a matter would be easily remedied with a retrospective application for a building warrant from Glasgow City Council. However, because building standards were not adhered to by HELMS, no backdated planning permission can be granted without costly surveys. In addition, the statutory fee for a building warrant will be tripled where works have already been completed. Residents simply do not have the financial resources to fund that, and in the absence of building warrants the houses are now uninsurable and unsellable. Residents—many in the latter years of their lives—feel effectively imprisoned in their own homes. That is shameful.
I am currently seeking agreement from Glasgow City Council to waive the multiplier fee for the retrospective warrant and to cover the cost of the surveys needed for the building works. Will the Minister write to Glasgow City Council’s chief executive to make a similar call?
Does the hon. Gentleman not accept that the underlying fault lies with the UK Government scheme? To me, the UK Government lobbying Glasgow City Council to pick up those costs, rather than offering to fund them, seems the wrong way round.
The hon. Lady makes a fair point. I urge the Minister to show some leadership and overall responsibility. In the first instance, she should contact Glasgow City Council’s chief executive and offer a dialogue. I would be receptive to the hon. Lady’s proposal of the Government offering to finance those costs as a way of breaking the impasse and getting the problem dealt with. The problem requires a whole-Government approach from city level, Scotland level and UK level. That would be the most proactive way to deal with it. Ultimately, however, responsibility lies with the Department that introduced the scheme, and it should show some moral and financial leadership.
Earlier this year I met representatives of the Green Deal Finance Company to raise my constituents’ concerns. In the last year alone the GDFC has upheld 169 complaints against HELMS, compared with 14 complaints against all other contractors upheld since 2013. Clearly, one contractor is a massive outlier in those figures. Some 154 cases against HELMS remain under consideration by the GDFC. However, the piecemeal approach to handling complaints has put the onus on the victims. The sheer number of complaints upheld against HELMS suggests that there was a systemic failure of regulation by the Government and that a proactive approach is now needed, to tackle that huge failure in the green deal scheme. It was the responsibility of the Minister and the GDFC to lead in the matter; it cannot be the responsibility of residents who are already distressed, disoriented and at their wits’ end in trying to deal with it. They cannot be put under further stress from the huge effort of having to right the wrong.
I am sure that the hon. Gentleman is aware, from speaking to his constituents, that people who chose to pay over several years through their electricity bills are not able to withhold payment, which is a common and acceptable consumer rights practice, if they believe that there was mis-selling. If the power company does not receive the funds, those people accrue debt. They cannot prevent the green deal payment from being made through their energy bills, which means they accrue more debt in the process.
I completely agree. One of the most insidious aspects of the green deal scheme is that it locks people into a structural system. The loan is tied to the house, so the property imprisons the resident. That is the most appalling aspect of the way things have been manipulated by HELMS and other nefarious practitioners of the scheme.
HELMS made more than 6 million nuisance sales calls and, as the hon. Member for Paisley and Renfrewshire North said, was fined £200,000 by the Information Commissioner’s Office. The Department of Energy and Climate Change also fined the firm another £10,500, but conveniently the company was put into liquidation by its owners, who walked away after paying just £10,000 of the fines owed. The company was owned by the multi-millionaire Robert Skillen, who continues to live a highly privileged lifestyle at the expense of the thousands of people he ripped off—including my constituents—leaving a trail of misery and chaos in his wake. He fled abroad and continues to profit from his fraudulent business practices. If he had any honour he would return to the UK and face the accusations against him. Indeed, he should face prosecution for fraud.
I just want to make Members aware that Mr Skillen has returned to the country—on a number of occasions, I think. Once he turned up at the Green Deal Finance Company to ask for the details of the customers who have contacted it, so that he could contact them directly, such is the shamelessness of the man.
It is appalling to realise that this chap has such a shameless attitude that he does not accept the harm he has caused to thousands of people, who cannot sleep at night. I hope that he will realise the impact he has had on them. However, it is time the Minister and the GDFC took formal steps to censure and effectively blacklist the guy, to stop him continuing to exploit vulnerable people.
As the hon. Member for Lanark and Hamilton East (Angela Crawley) mentioned, dozens of other homeowners in Glasgow North East are still literally paying the price of the green deal’s failure, through the finance deals that they were conned into to get the work done. A home is somewhere that we should all be able to consider a sanctuary and place of safety. However, many are so depressed by the green deal trap that they can no longer bear to live in their own homes, which are the very source of their turmoil.
Most people would consider a Government-backed scheme such as the green deal to carry a copper-bottomed guarantee, but for many of my constituents the feeling is one of total betrayal by the authorities they trusted. The Tory Government created the environment in which rogue traders could pull a fast one. The Government and the Green Deal Finance Company must now do everything they can to find a remedy for those who have been adversely affected. They must contact all 4,226 HELMS loan recipients, to make them aware of what they can do to find redress if they experience financial detriment because of the scheme. They must also consider a compensation scheme for those affected by mis-selling by HELMS.
That is why after I was elected I joined the all-party parliamentary group on green deal mis-selling, along with my hon. Friends the Members for Rutherglen and Hamilton West (Ged Killen) and for Coatbridge, Chryston and Bellshill (Hugh Gaffney), and why I presented a petition to Parliament earlier this year, urging the House of Commons to ensure that the Government compensate and protect people who have suffered detriment because of the green deal scheme. In the interest of fairness and justice the Government should now take steps to ensure that the same thing can never happen in future.
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) on securing the debate. I welcome the comments and interest of other hon. Members; they mentioned the particular issues for their constituents. We have a shared wish to see proper redress for consumers who have been mis-sold green deal plans. I thank the hon. Gentleman for highlighting the case of Mr and Mrs Murray. We listened to his account of the sadness and horror that they have experienced.
I want to make a particular point at this stage. As the Minister responsible for consumer protection, company law and the insolvency process, I place it on record that the Government are committed to ensuring that rogue directors, rogue traders, are investigated, in the interest of protecting consumers. I feel very strongly about that in this role and, obviously, my other roles in Government.
In total, Home Energy and Lifestyle Management Ltd, which I shall refer to as HELMS, was responsible for selling 4,581 green deal plans. Of those, 3,068 were sold to households in Scotland and 293 in the hon. Gentleman’s constituency. We understand that about 460 consumers have made complaints about the green deal plans provided to them by HELMS. That is a substantial number and it is a real concern, but let us remember that a large majority of green deal plans run smoothly, without complaint.
Most complaints focus on the fact that HELMS led consumers to understand that there would be no cost to their installation. HELMS gave consumers the impression that that was possible because of the nature of the Government’s green deal scheme. Consumers were then surprised to see green deal payments appear on their electricity bills. Many consumers were unaware that they were entering into a credit agreement, or of the opportunity that they had to cancel their agreement. That runs counter to what the green deal is about—enabling consumers to install energy efficiency measures through a loan and then repay through the resulting savings on their energy bills.
The consumer’s position was often worsened because they were persuaded by HELMS to assign elsewhere the rights to any feed-in tariff from the measures. HELMS encouraged many to transfer their feed-in tariff rights to a separate company—one related to HELMS—as a contribution to the costs of their installation. That meant that consumers could not put that potential funding stream towards meeting the costs of the green deal plans, and HELMS failed to inform the consumer of the impact.
Before saying more about the HELMS cases, I shall provide some background on the green deal. It was launched by the coalition Government in 2013. Under the green deal, consumers can borrow money to fund improvements and repay the loans over time through their electricity bills. In the case of solar PV, consumers can begin to use renewable energy generated on-site in their homes. The savings can then be used to repay the loan. A principle called the golden rule, which has been mentioned today, is in place and intended to ensure that loan repayments do not exceed expected savings.
It is true that at the time the Government and, indeed, hon. Members from across the parties had high hopes for the green deal. But it failed to take off to the levels expected. Various reasons have been offered for that. They include its complexity and the fact that it did not properly consider consumer demand to undertake energy efficiency improvements in this way. The original scheme design was not perfect, but we and others believe that the pay-as-you-save mechanism at the heart of the green deal can still play a valuable role in the future. We have published the summary of responses to our call for evidence and will consult on proposals in due course. The right consumer protection will be paramount in any reformed scheme.
We want to improve the green deal, but it is far from being the only game in town for energy efficiency. Just yesterday the House debated the Draft Electricity and Gas (Energy Company Obligation) Order 2018, under which we are looking to further improve the already successful energy company obligation scheme. Since 2013, it has led to over 2.4 million measures being installed in nearly 2 million homes.
To make things right for the consumers who have suffered from the activities of HELMS, it is important to know that there is a specific process for handling complaints under the green deal. Consumers should first approach their green deal provider. If the problem is not resolved, the consumer may then approach the green deal ombudsman or the financial ombudsman service, depending on the nature of the complaint. Ombudsman decisions are binding on the green deal provider. If the consumer is still dissatisfied, they can refer their complaint to the Secretary of State for consideration.
The liquidation of HELMS further complicated resolving consumer complaints, as it meant any ombudsman decisions against HELMS could not be implemented through the company. Therefore, my Department worked with other key parties to establish a mechanism to offer a resolution for consumers. The Green Deal Finance Company reviews those cases and, where it considers it appropriate, makes settlement offers to consumers. If they are dissatisfied with any offer received, consumers can still refer their cases to the Secretary of State under the green deal framework regulations. The Secretary of State has the power to reduce or cancel loans where he is satisfied that the consumer has suffered, or is likely to suffer, a substantive loss.
Does the Minister think that, rather than the onus being on the individual to seek that assistance, the Green Deal Finance Company ought to be writing to every recipient of a loan and every customer of HELMS to make them aware of the route to getting redress, if they need it?
The Green Deal Finance Company will make those offers. If they are not accepted by the consumer, the onus is on them to recommend the case to the Secretary of State and for him to take the decision. That is the redress process that we have put in place.
(5 years, 10 months ago)
Commons ChamberThe right hon. Gentleman is nodding in a way that is encouraging.
Many of my constituents, as well as thousands of people across the country, have been subject to mis-selling under the Government’s green deal scheme, which was launched in 2013. Many are still paying the price and are thousands of pounds in debt. What will the Government do to compensate them and address the long-standing toxic legacy of the green deal scheme?
There are examples of mis-selling—and, indeed, under the current energy company obligation scheme. There is the usual redress through consumer channels, which hopefully the hon. Gentleman’s constituents know about. If he has specific cases he would like me to take up, I would be happy to look at them. I am working with a number of MPs. The Government do not step in—this was always a third-party scheme—but we do have an ombudsman in the green deal finance sector. It is important that whatever responsibilities and rights are there are used for the benefit of all our constituents.
(5 years, 10 months ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
The hon. Gentleman, an experienced parliamentarian, will know that we have an income-contingent loan system. The repayment threshold has recently been raised from £21,000 to £25,000, thereby benefiting students to the tune of £300 a year. Deliberately designed into the system is a subsidy from the Government; we understand that 45% of students will not pay back the loans in full—that is the subsidy that goes into the loan system. The system means that no one is barred from going to university as a result of their personal financial circumstances.
One benefit of being elected to this place last year was that I was able to pay off my student loan much quicker than I expected. As the Minister will be aware, it was arrested from my wages directly, in the same way as national insurance contributions and income tax. So why on earth would the Government sell off future revenue sources such as student loans, given that they would not dream of doing it for national insurance or income tax? This is absurd.
The repayments are collected through the tax system, and that does not change at all. All that changes is that the benefits of the future income stream now accrue to someone else. That is done not only by Governments around the world, but by businesses. It is a simple fact that if we can capture the value of an uncertain income stream today at a reasonable price, it makes sense to do so.
(6 years, 1 month ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Clearly, we can both tear apart quotes, but the bottom line is that that is what the then chief executive of National Grid said. I was just going to come on to a quote from Dr Mark Diesendorf, of the University of New South Wales, in Australia. He stated that the assumption is
“that nuclear power is a reliable baseload supplier. In fact it’s no such thing. All nuclear power stations are subject to tripping out for safety reasons or technical faults. That means that a 3.2GW nuclear power station has to be matched by 3.2GW of expensive ‘spinning reserve’ that can be called in at a moment’s notice.”
He further states:
“The assumption that baseload power stations are necessary to provide a reliable supply of grid electricity has been disproven by both practical experience in electricity grids with high contributions from renewable energy, and by hourly computer simulations.”
Therefore, the argument that Wylfa and other stations are required to supply baseload is flawed.
On the point about baseload, does the hon. Gentleman not recognise that the whole point of managing a baseload with nuclear power stations and reactors is that they are organised to be taken offline in a scheduled programme of maintenance? In the case of Torness, it almost broke the world record for a continuous run of 495 days before being taken offline. Surely that is a huge achievement for engineers in Scotland?
The hon. Gentleman tried to worm in a compliment to engineers in Scotland at the end of his intervention. Of course I welcome the skills of engineers, including nuclear engineers—I have no doubt that the guys doing that work are highly skilled engineers. I still do not agree with the concept that the baseload is required from nuclear. If we think about Hinkley power station, we were originally told that, because of the baseload required, if it was not commissioned by December 2017, the lights would go out. We are way beyond that deadline, since Hinkley will not come on stream until closer to the end of this decade, and we are still managing our electricity supplies. There are ways to manage baseload through alternate supplies, which I will come on to.
The only other reasoning I can see for this headlong rush into more nuclear is the equally outdated concept of the UK being a world leader in a particular sector, but that will come about because of other countries pulling out of the nuclear sector. The US is not building new nuclear, Japan has changed tack and Germany has pledged to phase out new nuclear. It seems that the UK will be a world leader in propping up the nuclear sector for other countries. In a recent Westminster Hall debate on the nuclear sector deal, the hon. Member for Bolton West (Chris Green) stated that we should not be reliant on foreign countries for our energy, but with these new nuclear proposals, including Wylfa, that is exactly what we will still be: reliant on foreign countries for their expertise, knowledge and supply of goods.
I suggest that the UK might be the world leader in bad nuclear deals. Returning to Hinkley, we have a 35-year agreement at a strike rate of £92.50 per MWh, when offshore wind recently came in at a strike rate of £57.50 per MWh, and that £57.50 is only for a 15-year tenure. The Hinkley deal is so bad that it was criticised by the NAO as bad value for money. Part of the problem with Hinkley was the risk and the financial exposure to private investors, allied with the fact that the technology for the EPR, or European pressurised reactor, has still to be proven, with all existing EPR projects under construction still facing delays and cost overruns.
As investment in nuclear around the world falls, the UK has planning for 11 reactors on the go and two reactors under construction at Hinkley. In its latest report, released recently, the National Infrastructure Commission states that there should be a maximum of just one new nuclear contract signed before 2025 because of the reduced costs of renewables and the other emerging technologies, including the massive decrease in the cost of batteries. Its report also illustrates that, over the years, the cost of nuclear has not decreased, debunking another UK Government aspiration that continually commissioning new nuclear such as Wylfa will somehow reduce costs. Has the Minister assessed those comments, and will the Government provide a response to the report in due course?
Wylfa is also a different technology from Hinkley, and other proposed sites have yet further different technologies. It therefore stands to reason that, when employing those different technologies, the inherent price will not be brought down, because we will not benefit from repeat constructions and using the skills gained during one project on another. There will also be site-specific constraints and considerations.
This backdrop brings us directly back to the Wylfa proposals. Getting direct information from the Government remains difficult due to their claims of commercial confidentiality. However, the private developer, Hitachi, has clearly had difficulties with the costs and risks associated with the project, which has led to the suggestion of the Government taking a direct £5 billion stake. In principle, a direct Government stake in key infrastructure projects makes sense, as they can borrow more cheaply than private investors. However, in this case, it seems to be part of another, wider blank cheque-type agreement, with the Government desperate to get the project moving.
It is not only me using the blank cheque analogy. Will Gardiner, chief executive officer of Drax Group, said:
“I am not a fan of sweetheart deals, the government sitting down with Hitachi and writing them a cheque. That’s not good economics”.
On the economics, we have heard reported strike rate figures of £77.50 per megawatt-hour quoted for Wylfa. That reduced rate, compared with Hinkley’s, is on the back of the £5 billion stake. While the Government are trying to keep information under wraps, managing to learn anything is still a bit of a smoke-and-mirrors game.
Under the Paris and Brussels conventions, a nuclear operator is liable for any nuclear incidents. However, that liability is capped at €1.2 billion, which is way below the cost of a catastrophic incident—the Fukushima incident ran into the hundreds of billions of pounds—so the cap is arguably too low. Hitachi has already had two serious safety breaches in other nuclear developments, and was fined $2.7 million by the US Government for one of them. Apparently learning from that, Hitachi is resisting taking on liability for nuclear incidents at Wylfa. We do not know its exact proposal, but it marks a departure from current agreements, where the operator should be responsible for health and safety and attendant risks and liabilities.
The Times reports that Hitachi “won’t pay” for nuclear accidents at Wylfa, based on Nikkei reports that some of Hitachi’s directors wanted
“safeguards that reduce or eliminate Hitachi’s financial responsibility for accidents at the plant”.
It also marks a departure from the “polluter pays” principle. It is critical that the UK Government do not sign up to any such crazy proposals. I hope the Minister provides real clarity on this matter and does not hide behind commercial confidentiality.
We know the Prime Minister hit the pause button for Hinkley Point C to allow for a cost review. Despite that review, she somehow then caved in and accepted what the National Audit Office has subsequently confirmed is a bad deal. Why do the Government appear to be pulling out all the stops again to get Wylfa over the finishing line—by which I mean the agreeing of the contract? We know full well that the project will invariably end up over budget and delayed, just like every other ongoing nuclear project in the world.
Another argument in favour of Wylfa and other nuclear projects is the jobs they will create. I agree that these high-skilled jobs are vital for the localities with existing power stations, and I understand Members lobbying to maintain—or to create further—high-skilled jobs. However, those jobs should not come at any cost. Indeed, paragraph 23 of the Welsh Affairs Committee’s July 2016 report, “The Future of nuclear power in Wales”, explicitly states:
“We recommend that the Government negotiate a strike price for Wylfa Newydd below that agreed for Hinkley Point C and seek a price that would be competitive with renewable sources, such as on-shore wind. The Government should not continue with the project if the price is too high.”
It seems, based on that recommendation, that the Committee must by default be against this project continuing, as it clearly cannot be competitive compared with onshore wind. Has the Minister consulted the Committee on the recent developments in the likely cost of Wylfa?
I would not want to see job losses anywhere. I represent a deindustrialised constituency. Over the years, we have lost coal mining and many different manufacturing jobs. However, we can spend money more wisely to create jobs. Wylfa will cost up to £20 billion. The new nuclear legacy programme will cost circa £100 billion, and we have spent nearly £120 billion in decommissioning costs. Departing from civil nuclear projects, the successor programme to replace the Trident submarines will have whole-life costs of more than £200 billion, with future decommissioning costing up to £250 billion.
Those are astronomical sums of money, and we should be able to think how to spend them more wisely. We could have proper infrastructure investment and a targeted jobs and manufacturing strategy that would create more jobs and a more balanced economy, and we will not have the toxic legacy of nuclear. By the time Hinkley and Wylfa are constructed, with their anticipated 6 GW capacity, we could build something like 20 GW of offshore wind capacity. We know that the costs of batteries are plummeting, and renewable costs have also plummeted.
We should invest in carbon capture and storage. I welcome the Government’s latest report on CCS, but we should never have pulled the previous £1 billion allocation. How ridiculously small does that £1 billion seem compared with the costs of nuclear I have outlined? CCS will also allow for the decarbonisation of gas and biomass electricity generation and will open up the potential for a supply of zero-carbon fuel, in the form of hydrogen. However, each massive undertaking for nuclear is to the detriment of investment in renewables. When the Government give undertakings and risk guarantees for Wylfa, they reduce their scope to make similar guarantees for emerging technologies.
On jobs not coming at any cost, we also have to appreciate the potential health risks. As outlined by Dr Ian Fairlie, an independent consultant on radioactivity, the risks of leukaemia in nuclear workers are double those found in a 2005 study, and there is
“strong evidence of a dose-response relationship between cumulative, external, chronic, low-dose, exposures to radiation and leukaemia”.
He also states:
“When nuclear reactors are refueled, a 12-hour spike in radioactive emissions exposes local people to levels of radioactivity up to 500 times greater than during normal operation”.
He states in his blog that the research behind these findings is “impeccable”, as it was based on
“a huge study of over 300,000 nuclear workers adding up to over 8 million person years, thus ensuring its findings are statistically significant”.
I suggest we pay heed to such research.
As I have said, the cost legacy is bad enough, and we still do not have a solution to the long-term disposal of nuclear waste, so it is absolute folly to sign a deal in which the taxpayer takes on unlimited risk for a nuclear incident. This could prove to be the worst deal yet unless the Government change tack soon.
It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for Kilmarnock and Loudoun (Alan Brown) on securing this debate. This is an important and pressing issue for the UK, because, as we have heard, all of Britain’s currently operational nuclear reactors are due to go offline by 2030. So there is a pressing need to address this energy question.
In Scotland, the nuclear energy sector is worth £1 billion a year. Although 1,000 people are directly employed in Scotland’s two nuclear power stations, which have four advanced gas-cooled nuclear reactors installed, 12,000 people are indirectly employed, through a large supply chain encompassing engineering and design, which is a huge benefit to the Scottish economy. This is, therefore, a pressing policy issue for not only the whole UK but Scotland in particular.
I find it extremely dismaying that there is this dislike of nuclear power production, when the sector presents so much opportunity for Britain to re-establish a lead. After all, Britain was the world’s first generator of civil nuclear power. That is, unfortunately, an industrial lead that we have lost through lack of planning and lack of rigour in the 1990s. We can, hopefully, re-establish that lead with a bit of imagination and boldness.
I have the pleasure of serving on the council of the Institution of Engineers and Shipbuilders in Scotland. In 2015, we presented a lifetime achievement award to Sir Donald Miller, inducting him into the Scottish Engineering Hall of Fame. He is Britain’s foremost electrical engineer and was almost singlehandedly responsible for the design and development of Scotland’s entire post-war electrical generation and supply system.
I was interested to hear what Sir Donald Miller had to say about Scottish energy generation today. When he was presented with his award, he delivered a speech, which I feel is worth quoting at length. He mentioned that when he retired as chairman of the South of Scotland Electricity Board, which is now known as ScottishPower, in the early 1990s, he could take a great deal of satisfaction from the fact that
“we could claim to have one of the most secure and cost effective systems world-wide. Some 60% of our energy was from nuclear and with the hydro we could, incidentally, also claim to be one of the greenest systems with the lowest carbon emissions… The coal fired station at Longannet”—
which was recently decommissioned and was groundbreaking when it was built—
“was used mainly for back up and profitable exports to England for the benefit of Scottish consumers.
Today we see a very different picture. The decommissioning of our conventional generation is fast approaching”—
indeed, it has already approached—
“and yet there are no plans to replace the generating capacity at Longannet or the nuclear. Even more incomprehensible is that we shall, in a few years, be importing power for much of the time from the new nuclear station to be built just over the border in England at Sellafield. You may wonder just why Scotland (birthplace of so much engineering)”—
a pioneer of nuclear energy—
“should be importing power we could well generate here, exporting highly skilled jobs in the process. And moreover ending up with the least reliable and insecure electricity supply that we have seen for a hundred years. And this at a time when electricity has never been more important in the lifeblood of modern society.
We seem to be drifting into this situation with our eyes shut; just hoping it will be all right on the night. But with no electricity for twenty four hours (and perhaps even longer) it will seem a very long night indeed.
No engineer would set out to build a complex structure without a detailed plan and an electricity supply system is no different in this respect from a road network or an aircraft carrier. But there is no plan and nor is there any significant engineering input into the main decision making.”
That is a chilling statement, coming from someone of such repute, about the current state of Scotland’s energy system. That drives me to understand that there is an urgency here that we are not recognising but that we must address with imagination. The Scottish Government have been found utterly wanting for their lack of willingness to embrace new technologies when it comes to nuclear energy.
I have had the pleasure of twice visiting Torness nuclear power station, where the two advanced gas-cooled reactors are situated. The great tragedy of that advanced gas-cooled system is that the entire power station is limited by the life cycle of the reactor. The infrastructure around the reactors is highly modern. It is a great shame that, in 2030, infrastructure that could continue operating for many decades afterwards has to be closed and dismantled, because the reactors themselves cannot be moved and dismantled safely without that whole system being shut down.
Yet, there are emerging technologies that offer great opportunities, such as small modular reactors, which Britain will potentially pioneer, with Rolls-Royce in the foreground. I am hopeful that that is something that Scotland can look at and embrace. Not only can we secure the sector, which, as we know, is worth £1 billion and 12,000 jobs, but we can achieve so much if we are on the front foot. When I was working for BAE Systems at Govan shipyard, we looked at how we could develop and manufacture small modular reactors in the shipyard, thus sustaining not only nuclear supply, but our shipbuilding industry. There are huge opportunities for coastal locations.
I was pleased that the Government launched the nuclear sector deal in Trawsfynydd. Trawsfynydd is a decommissioned station, but it has the infrastructure in place, and it has a community that understands and accepts nuclear energy for the future. I believe that putting the two together will benefit those communities and the whole of the UK.
I thank my hon. Friend for that timely intervention. We have to think about this outside of these silos of energy generation. Although we want to decarbonise electricity in the UK, which is a laudable and vital aspiration, if we are to tackle the problem of climate change, it is critical that we recognise that nuclear has to be part of that mix.
Renewables, although we hope that they will eventually substitute all energy generation in the UK, are simply not mature enough, in terms of their reliability, to deliver output that is secure enough. The variability of wind is proving to be problematic. July’s wind energy is 40% lower compared with the same period last year. That is simply not sustainable enough for us to generate reliable energy sources in the UK. We have to look at other technologies, and nuclear presents an opportunity. We are not talking about rebuilding advanced gas-cooled reactors, which was a technology developed in the 1960s—it was advanced for the time, but is simply obsolete today. We are not talking about rebuilding that, with all the legacies of toxicity and problems with waste disposal that were mentioned, although I have to say that the advanced gas-cooled reactor fleet in the UK is a global benchmark for safety. I do not think there are any substantial risks associated with the advanced gas-cooled reactor fleet—it has had a tremendous safety record in the UK, which is a great triumph of British engineering.
We have to approach this with an industrial strategy; that is where we have to grip this. We are talking about shipbuilding and energy generation. All of those things can be linked to deliver a huge industrial and economic benefit for the UK.
The hon. Gentleman is talking about emerging technologies—if new nuclear is an emerging technology. I presume he would welcome investment in carbon capture and storage in Scotland, and investment in tidal. The Scottish Government are not saying no to nuclear and no to new technologies; they are going to welcome wider technologies that are completely renewable and that do not have the potential toxic legacy of nuclear.
That is an entirely legitimate point to make. We want to push on all fronts. We want Britain to be leading the world on all fronts. That requires investment in battery technology, where we have a huge disruptive opportunity. Let us push on that front. Let us push on carbon capture and storage. Again, the problem is that we have no rigorous industrial strategy. When I worked at Scottish Enterprise, for example, we watched Longannet drop off a cliff, with no plan for its succession and how it would be managed. As a result of that, we saw the collapse of Hunterston ore terminal in Ayrshire, which has now lost all its customers, because it was the input point for the transportation of coal to the power station.
Longannet collapsed because it was no longer economically viable, due to the amount Longannet had to pay to connect to the grid, which is all based on distance from the population of London. Does the hon. Gentleman accept, therefore, that that is a UK Government failure, not a Scottish Government failure?
The issue was a joint problem because we did not embrace the possibility of carbon capture and storage at Longannet. Nor, as the hon. Gentleman mentions, did we address the calculation system and the price charged for generation at Longannet—we have to address this issue on all fronts. Longannet was a failure because, ultimately, the jobs and industrial benefits were lost. As a result, we now have a large brownfield site that will cost a lot of money to clear up, for want of a proper succession plan and a proper strategy.
I urge all Governments to get a grip. I do not lay the blame on any one of them. I am describing the reality that faces the community and our country now, and it is about time we gripped it. I urge people to get together to sort it out. We have a lack of strategy in dealing with succession planning when it comes to closing down our nuclear fleet and also our conventional coal-fired fleet, so we have to address that. We must have a strategy. We have the opportunity.
Emerging technologies, such as the integral fast reactor, which is under development, will address the waste problem in nuclear. As Professor David MacKay, the chief scientist at the former Department of Energy and Climate Change, said, the reactor could supply all the UK’s energy needs for 500 years by consuming the UK’s existing stockpile of waste. That also addresses the decommissioning of the nuclear submarine fleet and the nuclear weapons at Aldermaston. It is a huge cycle that we have to address, and currently we are not gripping it.
We have a huge opportunity to embrace these technologies and use them as a basis for Britain to re-establish a global leadership position in civil nuclear energy that addresses the huge legacy of problems that we have had with nuclear. This is not about saying we can write nuclear off because the technology developed in the 1960s was flawed; it is about saying we are where we are and there are opportunities to utilise nuclear not only to deliver a low-carbon generation capability, but to address toxic waste issues. It is about developing, regenerating and manufacturing an advanced engineering base.
That is why I urge everyone to be open-minded when approaching the issue of new nuclear technologies in the UK and to look at new technologies that can benefit the Scottish and UK economies. That is how we and the trade unions are approaching it, and it is an entirely legitimate and open-minded approach. I am dismayed that the SNP will unconditionally block any potential exploitation of the opportunity in Scotland at Torness or Hunterston. That is a great tragedy for Scotland, a nation that has done so much to be a world leader in civil nuclear technology. I hope the SNP might look at those technologies and change their minds.
As I was born and raised within a short distance of Hunterston power station, I understand that people worked on building that station, but we are talking about power that can cause so much destruction that we cannot possibly comprehend it. I agree we need a balance, which is why I support wind, wave, tidal, solar and hydro as part of the mix. I want us to progress so that we do not need nuclear as part of the mix. That is the ideal situation that we should work towards.
The hon. Gentleman correctly highlighted job creation, but obviously the jobs are where the investment is. He highlighted the lack of support for the Swansea tidal bay, which is an absolute travesty by this Government. It was a great opportunity to invest in renewable energy and see where that could take us. How many jobs would that create in Swansea and how many within the supply chain around it?
The hon. Gentleman talks about a comparison with asbestos and the idea that nuclear energy generation is somehow inherently toxic. What does he say about the integral fast reactor or the small modular reactor technology that consumes nuclear and therefore solves the problem that he claims exists? That is surely to be welcomed and embraced.
As I said, we are working towards a mixture of renewable energy. Ideally, if we could do away with the potential dangers, we should do so. One can say that about absolutely any industry. The coal mining industry was a dangerous business. We always worked to minimise the dangers, which is what we should do in the case of nuclear energy. If we can do it with nuclear as part of the mix, that is what we should work towards. We should invest in new measures to see if we can attain that. We should learn the lessons of Hinkley, a point made by the hon. Member for Ynys Môn. I hope we will learn the lessons of Fukushima as well.
The hon. Member for Glasgow North East (Mr Sweeney) said that nuclear was once seen as the future in the United Kingdom. He is right: it was once seen as the future. It was also seen as the future in Germany and Japan, but they have moved on. Unless we want to be left behind in areas of technology, we have to move on as well.
It is a pleasure to serve under your chairmanship this afternoon, Mr Robertson. While I have the floor, may I take a moment to thank the Clerks and those who work so hard across the House of Commons to ensure that these debates take place? I particularly thank the Hansard reporters who are a miracle of accuracy, regardless of the quality of the debate—I just wanted to put that on the record before we go off on our summer holidays, although as we know, none of us are going on holiday; we will all be working hard in our constituencies.
I thank the hon. Member for Kilmarnock and Loudoun (Alan Brown) for securing this debate. We have had important conversations today, including two very stirring speeches from the hon. Members for Ynys Môn (Albert Owen) and for Glasgow North East (Mr Sweeney). I could not have made the case better myself—I will not try to, because Members probably do not want to hear me talking about that—but a point was made about having an energy supply that is diverse, strong, reliable, low cost for consumers, low carbon and, crucially, able to create innovation for reinvestment in the UK and for export.
I pay tribute to the long experience of the hon. Member for Glasgow North East in the shipyard. As he will know, if we had thought more about export potential when making some industrial decisions in the past, we would not have lost those high-skilled jobs. To reassure him, I was at the Cammell Laird shipyard two weeks ago to help to launch Boaty McBoatface. It was wonderful to see what £200 million of Government investment in polar research has delivered for that shipyard—thousands of jobs have been created and it has been able to bid for large-scale projects again. I enjoyed the speeches.
I will try to address the specific questions about safety, incidents and long-term liabilities. The hon. Member for Ynys Môn made a powerful case about our heritage. We should all be proud that we are leaders in the global civilian nuclear community in terms of safety and regulation, which we have built up extremely well over the years.
In this country, we do not set energy policy on the basis of ideology but on the basis of the test that I have discussed, so we will not make the mistakes of countries such as Germany. Last year, I was at the Conference of the Parties in Bonn to debate climate change, and barges of brown coal were sailing past the COP site—putting two fingers up to those who believe in reducing emissions and getting coal off the grid.
We all like to look at our apps, and there is an excellent one that tells us about the energy mix in the last 24 hours. We have burned no coal, which is excellent, and we used a bit of wind, which made up about 6% of the energy supply. Of the rest, 25% was from nuclear, 50% was from combined-cycle gas plants, some was from biomass and some was from interconnectors.
Last year, for the first time since industrialisation, the country did not burn coal for energy generation, which was a huge milestone. The Minister talks about the huge industrial benefits and the benefits to the wider economy. Does she also recognise the benefits of the nuclear advanced manufacturing research centre in Rotherham, which has re-established large-scale casting capabilities in Sheffield—an industrial capability that had been lost in the UK?
The hon. Gentleman is absolutely right. I will make reference to the nuclear sector deal that invests in the small modular reactor technology that he talked about and that engages with the industry and its supply chain by investing in innovation and skills and by thinking about what we can generate and export in the UK. I also pay tribute to the organisation that he mentioned.
(6 years, 1 month ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
In Scotland, the nuclear energy sector is worth £1 billion a year, employs 12,000 people, and generates 35% of the nation’s electricity in a stable and consistent way. Scotland’s four advanced gas-cooled reactors are due to be decommissioned and taken offline by 2030. Has the Minister had any discussions with his Scottish ministerial counterparts on the huge industrial opportunity that this presents for Scotland at Hunterston and Torness after 2030?
I am glad that the hon. Gentleman has recognised that there is a huge opportunity for Scotland in this deal, given how much Scotland participates in the supply chain. As we are doing with the devolved Government in Wales, we will be working with all the devolved Administrations, where this is relevant to them, to make a success of this deal.
(6 years, 2 months ago)
Commons ChamberI will certainly do that. My hon. Friend characterises the situation well; this company has issued profit warnings in the past and has committed to take action to be efficient. These are the decisions of the management, but I think every Member of the House would acknowledge that it is important that our companies are competitive. He is right to say that the skills of the people employed in Derby, whether in management or in other supporting roles, are in great demand in the expanding economy there; unemployment has halved since 2010 in the east midlands. I will work with the neighbouring LEPs to make sure they have every support and that businesses that want to employ those people have every support in identifying what could be talented and welcome additions to their workforce.
Rolls-Royce is an iconic industrial asset for Britain, and its relationship with Glasgow goes back as far as the second world war. Even to this day it drives huge innovation in the city, from the Advanced Forming Research Centre to supply-chain companies such as Castle Precision and East Kilbride Engineering Services, all of which benefit from the huge industrial presence of Rolls-Royce. One difficulty that the company has had in recent years is the development of new products, particularly for the small airliner market, which is restricted because of this country’s lack of capacity for long-term industrial investment through state investment banks. Will the Secretary of State consider how we can support industrial development in the longer term by developing such capacity in the UK through a state bank for new product development?
Part of the reason for the development of the industrial strategy, which prominently includes the aerospace sector, is so that we can have the long-term support that is required. When I talk about support, I mean for research and development programmes, which can take many years to come to fruition. We are known as and have a reputation for being one of the best places in the world for that, and that is a deliberate policy objective. It is exactly the same with skills.
On what the hon. Gentleman describes as a state bank, we have various means, including the British Business Bank and UK Export Finance, which have been set up to support businesses in pursuance of our industrial strategy. Rolls-Royce is an active participant in that.
(6 years, 2 months ago)
Commons ChamberThe hon. Gentleman cites numbers that have no relevance to the negotiations. We have to keep bills down, and we have to make sure that the lights are on, that we have a secure energy supply and that we decarbonise. We think nuclear is very much part of that mix.
The feed-in tariff scheme was launched in 2010 and now delivers £1.5 billion-worth of support a year for low-carbon generation. It has been really successful, and over 6 GW of it has been deployed—2.5% of UK electricity consumption. We want to see how we can deploy it at a subsidy-free level, as that is where prices are going. I will launch a call for evidence on the future of small-scale generation soon.
Although I was delighted to hear that the world-leading small wind turbine manufacturer in my constituency, Gaia-Wind, was saved from liquidation this week by an overseas buyer, the unnecessary uncertainty that the Government have created around the future of small-scale renewable energy persists. So will the Minister put investors and companies at ease and make a cast-iron promise to bring forward the consultation on future support before the summer recess?
I am really glad that, as the hon. Gentleman says, it looks as though at least some of the jobs at the company in his constituency have been saved. With these schemes, we always have to think about what is value for money and what is the right thing to do in terms of energy security and supply. I will not make cast-iron guarantees, but I can promise him that it will happen soon.
(6 years, 4 months ago)
Commons ChamberTakeovers are a good thing where they are likely to enhance value, but it is clear that this highly leveraged takeover by Melrose is likely simply to load GKN with £8 billion of debt. We know what will happen, as we have learned the lessons of history: the company will be broken up and sold off piecemeal to recoup the debt raised by Melrose to create false value.
We have also seen a lukewarm commitment on R&D. GKN’s current R&D is at only half to two thirds that of its main competitors. Why did the Minister not seek a more ambitious undertaking that the takeover will enhance value and increase GKN’s R&D spending target to that of its main international competitors? I echo the sentiments of other Members on the need to amend our shareholder takeover rules to ensure that short-term interests of people with no industrial knowledge or understanding of companies are not permitted to distort the interest of stakeholders in the long-term value of this company.
For the first time in British corporate history, we have secured a commitment to spend, as a minimum, what the incumbent is already spending on research and development—that should be welcomed. Obviously, the reports of accounts and the disclosures that will need to be made to the markets will shine a light on the debt, but it is striking that it has been suggested today that £150 million was accounted for by unpaid suppliers’ bills at the end of the last quarter—I gather that is in the filings that have been released today—so I imagine the hon. Gentleman will want to study very closely with a beady eye the reports of accounts as they are published in the months ahead.