International Trade and Geopolitics

Debate between Richard Fuller and Andy McDonald

Thursday 20th April 2023 Commons Chamber

[Richard Fuller]

The hon. Gentleman reinforces my point. He is suggesting that if a company chooses to use its shareholders’ money to drive down a road that runs out, somehow taxpayers should pay for the extension of the road. The whole point of capitalist markets is that it is a business’s responsibility if it makes incorrect allocations of capital and its shareholders lose money. It is the job of business and business leadership to have the insight to understand how best to create value for shareholders in the long term.

Businesses are now coming to smart Labour Members—who are desperate to show that after years of hating business the Labour party now thinks prawn cocktails are a nice idea—and saying, “Can you spare us a few bob, mate? We’d like to support your party and we’ve got this really sexy thing we want to do, but frankly we don’t want to use our own capital because we know that the Labour party in government will be suckers enough to use taxpayers’ money to pay for it.”

[Andy McDonald]

I hope that the hon. Gentleman, as a former member of our Select Committee, will take this point in good heart. Just last week, we visited HYBRIT in Sweden, which has made some incredible advances in creating sponge iron and is on the road to creating green steel. One of its major partners in that enterprise, without which it would not have been possible, is the state-owned utility company Vattenfall. I ask the hon. Gentleman to consider that point.

This country’s version is to plough hundreds of millions of pounds of taxpayers’ money into the South Tees Development Corporation, transferring those assets to private individuals in return for options for land—for buttons—leaving the state on the hook for the environmental remediations. There could be no bigger contrast with more intelligent responses to industrial challenges. I trust that the hon. Gentleman will take that point in good heart and look at the differences in practice between the United Kingdom and Sweden.

[Richard Fuller]

Actually, the hon. Gentleman is exactly right. He and I share a concern for the defence of taxpayers’ money: if it is going to be spent, it should be spent wisely. If a strategy is not working, that is fine, but the point that I raised at the start of my speech was that we hold different points of view on whether industrial strategy per se will be an answer to the problems. My general position is that leaving the market and businesses to themselves and allowing the free allocation of capital in open and competitive markets has proven time, time and time again to be the best way to achieve progress, with better living standards for households in this country and around the free world. That is why the developed nations are the developed nations: because we have supported that approach.

--- Later in debate ---

[Richard Fuller]

The Chair of the Select Committee nods. It is nice to have an area of agreement.

Let me move on to the second area about which the hon. Gentleman spoke: the Inflation Reduction Act and the associated EU measures. As he well knows, that Act represents a $370 billion commitment of US federal funds, or their equivalent in tax credits. It followed the Infrastructure Investment and Jobs Act of 2021, which meant $1 trillion of investment, not only in infrastructure but in green energy. By purchasing power parity, the US economy is approximately six times the size of the UK’s. An equivalent response, which is what the hon. Gentleman says we need, would essentially require writing a cheque for £40 billion, £50 billion or £60 billion. If industrial strategy is not about expenditure, what are we supposed to be doing to compete, other than putting in that amount of money? There seems to be a part missing.

The hon. Gentleman also spoke about inward investment and said that we should be sharpening up our act. He is absolutely right. In countries such as Germany, which he mentioned, the package on offer to those who are interested in investing is not just a financial package, but a coherent one. When someone looks into making an inward investment, there are people to sort out all the Government intricacies for them at a single point on day one. That is how the UK did it when Margaret Thatcher was leading efforts with Lord Young, but over the intervening years we have made things a little too complicated and we have not found our way. I would be interested to hear the Minister address that point; it may not be directly in her remit, but it would be interesting for all hon. Members present to know the Government’s view. What are the Government doing to make sure people know that the UK can take a foreign company from thinking it wants to invest in this country to actually getting going and investing in this country, whether that involves, say, bricks and mortar or servers? What can we do to make that easier?

I know this sounds as though I am picking the hon. Gentleman’s speech apart. I am not picking it apart but asking questions about it, and I trust he is happy with that. He talked about economic security and collaboration. I think the short-term version of that is called friendshoring, which essentially means saying, “Let us conduct a geopolitical review of important strategic supply chains, and then let us be smart and make sure we are doing business with countries that are our allies.” That is a massive change, because there is no clarity about what the extent of friendshoring areas should be. Does this apply only to strategic industries determined by the United Kingdom, or is it imposed on the United Kingdom because other friends think we should be doing business with someone else? Are we prepared as a country to outsource the way in which British companies do business to the Government of the United States?

[Andy McDonald]

The hon. Gentleman is making an interesting point, but does he not agree that when it comes to critical areas of our economy such as energy security and the opportunities presented by carbon capture, utilisation and storage, it makes consummate sense to have strong relationships with those neighbouring countries with which we are aligned? As we face the spectre of Putin, who has caused so much damage to our energy security of late, would it not be infinitely more sensible to look to the new technologies and look to those neighbours to work together in that domain for our mutual economic benefit? Surely that makes sense.

[Richard Fuller]

There are two parts to what the hon. Gentleman has said. Is it sensible for us to ensure that our national security is itself sensible, along with some of the elements that are important for national security? I do not think there are too many concerns about that; the issue is, should we be focusing our policy on the issue of only going with our allies, or at least making that the primary consideration?

I think this will be a problem if it becomes part of the international discourse. The Chair of the Select Committee seemed to be talking about unbundling the existing international organisation, paying it respect but recognising the “reality” of what is happening, but then looking at ways in which we can make side arrangements with our friends. I fear that that will mean pooling the understanding of what is a friend and what is not among others, which is a substantial change in the way in which this country seeks to run its economy. My view is that the United Kingdom should be an open society, an open trading economy, and that we should lean primarily towards openness.

[Andy McDonald]

With Russia? With China?

[Richard Fuller]

Obviously not with Russia. We have already imposed substantial trade sanctions on Russia, and I think there is consensus in the House about what our response should be when one country invades another. However, to conflate Russia with China, which has not, as far as I know, invaded another country, is to move into a different area. My point is philosophical: the United Kingdom’s history of success has been as an open trading nation, and the current push, in this country and others, for us to engage in friendshoring strikes me as a significant change from the way in which, historically, we have created wealth.

Vehicle Technology and Aviation Bill (Third sitting)

Debate between Richard Fuller and Andy McDonald

Thursday 16th March 2017 Public Bill Committees

[Andy McDonald]

If I knew what “homologation” meant, I might have a chance. My goodness, we get an education here.

Because we are entering new territory, we need to agree what we mean by automated vehicles. We have it fixed in our minds that the definition covers only end-to-end journeys, but there are also journeys of which parts are under the direct control of the vehicle and not of the person who occupies it. We already have autonomous braking systems—the Committee explored those on Tuesday—and our shared view is probably that they fall outside the definition of an automated vehicle, because they do not cover every function; the person occupying the vehicle is still required to intervene. There are also devices to ensure that drivers do not stray into another lane. Those are all welcome assistance measures, but they do not fall within the definition of an automated vehicle as I understand it. I do not think that it is asking too much to suggest that we go through the process of establishing the criteria.

[Richard Fuller (Bedford) (Con)]

The hon. Gentleman draws my attention to the word “monitored” in clause 1(1)(b). It is an interesting word to use in relation to whether a vehicle is autonomous. I can monitor myself driving but not be in control. Is not the essential point whether the individual controls the vehicle? I wonder whether he has any observations about the word “monitored”.

[Andy McDonald]

The hon. Gentleman raises a valid point. That is indeed the word used, but I find it a little difficult to reconcile with the rest of the Bill, because it might suggest some engagement and involvement. He is right to point that out, and I am sure that the Minister will want to pick up on his well-made observation.

The Opposition believe that the additional clarity provided by the amendment would help to create a more reassuring environment that encouraged the development and uptake of automated vehicles. The amendment would also prevent the Secretary of State from changing the criteria without further consultation. It has been pointed out that such consultation would happen in any event, as a matter of course, but I suggest that it would be helpful for that to be made abundantly clear in the Bill. The amendment would ensure that the criteria used remain up to date and as practical as possible in a fast-moving world, and that they provide a device to allow all interested parties to engage fully.

Finally, let me refer to our helpful scoping notes, for which I am grateful. We are told that in practice the Secretary of State would need to have regard to whether the vehicles or types of vehicles have met international or domestic standards on the safe functioning of automated vehicles. That is very useful, but I suggest that it is merely a part of the criteria that could be established. We need to think about the whole range of functionality that automated vehicles can deliver. Although that information is helpful, it is not the complete picture, which is why my amendment suggests a consultation and the establishment of criteria.

Vehicle Technology and Aviation Bill (First sitting)

Debate between Richard Fuller and Andy McDonald

Tuesday 14th March 2017 Public Bill Committees

[Andy McDonald (Middlesbrough) (Lab)]

Q I will be very brief. The Bill introduces the new concept we are moving to—the exposure to manufacturers’ liability. Has the Bill got it right in terms of the balance between insurers’ and manufacturers’ liability? Secondly, Mr Wong talked about accessibility cost. The cost of insurance will be key. Is the insurance industry ready for this? Clearly, premiums should be cheaper if we are getting errorless driving, but is the insurance industry sophisticated enough and ready enough to make that offer to consumers in the first instance? Lastly, on the issue of updates, does that present fresh exposures to manufacturers for the duration of the life of that vehicle on every software update iteration? Have you given any thought to how that plays in the context of current consumer protection legislation and issues of limitation? Does that now cause us to revolutionise the way we look at people purchasing vehicles? Are they going to be out there forever with software with little or no control? Any thoughts or comments?

David Williams: I think the Bill does have the balance right. It focuses on the road user. That is why we have got the Road Traffic Act 1988. Therefore the Bill has to focus on the safety of road users rather than insurers and manufacturers. As an insurer, we can price for anything. You have a balance with regard to how much liability finally rests with the motor manufacturer. That can develop over time, and they have definitely got some skin in the game. If they are negligent they will be called to account and will need to indemnify the insurer; so I think the balance is right.

With regard to whether the insurance industry is ready, in the past I do not think we have been, for things like this, but the fact that we already have the Autonomous Driving Insurance Group, which meets regularly and is very well attended, that the Thatcham motor vehicle research institute is all over it, and that AXA alone is involved with three of the Government-backed consortia means we are ready—we will be ready.

David Wong: On software updates, we believe that the “state of the art” defence principle applies here, which means at the point when the vehicle, together with the systems, including software and firmware, are being developed, the manufacturer has done its utmost to ensure that it is completely secure and, based on the scientific knowledge and the technology at that point in time, has done its very best. Of course, software updates are always, basically, a moving target; it changes every hour—but the “state of the art” defence applies in this case.

Steve Gooding: I think the motor industry will have to answer for this, because if you think of your home computer, every now and then you get a message saying “Your software is going out of support”. I think we need a bit of reassurance from the auto sector that we are not going to find that a vehicle we buy next year, and then in seven or eight years’ time is in the second-hand market, gets the message that “this vehicle is going out of support” and is therefore judged in some sense to be no longer roadworthy.

David Wong: It is reasonable to expect that vehicle manufacturers will continue updating, upgrading and patching the software, as do computer manufacturers and software manufacturers. However, even as Microsoft has decided, after a while, to discontinue the support for Windows XP and Windows Vista, one must not expect vehicle manufacturers to continue supporting particular software 20 years’ down the road, even if the vehicle is still roadworthy.

[Richard Fuller (Bedford) (Con)]

Q Within its scope, does this Bill do enough to position the UK as a global leader in vehicle technology? If not, what is missing? If you do not have the time to answer, maybe you can email me.