Public Ownership of Energy Companies

Sheryll Murray Excerpts

Monday 31st October 2022 Westminster Hall

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is a pleasure to serve under you as Chair, Mrs Murray. I commend the petitioners. It is clear that we need a serious debate about energy, strategic assets and how the energy market operates. For too long, what has constituted a so-called debate in this place has been the argument that private is good, and nationalised or public sector is bad—or vice versa. Unfortunately, there does not seem to be too much debate today either: most of the speakers are in broad agreement. It prompts the question: where are all these compassionate Conservatives, bringing forward their views, sticking up for what is going on and putting forward other ideas? [Interruption.] I see that someone is pointing to the Minister from a sedentary position. I state the obvious: the Minister has to respond. We will get his point of view, but where are all the Conservative Back Benchers?

I commend my hon. Friend the Member for Linlithgow and East Falkirk (Martyn Day) for securing the debate on behalf of the petitioners. He spoke in a balanced way, while also highlighting the abject failures of this UK Government. My hon. Friend rightly pointed out that the free market has effectively collapsed and failed. There has been insufficient regulation over the years. He also said that, if there was a properly regulated market, the citizens of the UK would feel the benefit, and there would not be such high levels of fuel poverty. He highlighted that the problems were exacerbated by Chancellors coming and going, and Prime Ministers coming and going, and the fact that when the current Prime Minister was Chancellor, he had no idea of the scale of the problem. The then Chancellor tried to introduce a £200 energy loan scheme, which would clearly never address the issues that real people face as they struggle to pay their energy bills.

Another point that my hon. Friend made on behalf of the petitioners was the need for a 25-year strategic plan. I certainly agree. In the long term, we should be looking at how we get to net zero. What do we need to do to get there? Where should we build the generation facilities to facilitate that, and in the cheapest possible way? What grid upgrades will we need? What other measures should be implemented, such as energy efficiency and upgrading homes properly? That would be long-term planning, and it would realise the most benefit for people in the UK.

The hon. Member for Wirral West (Margaret Greenwood) effectively highlighted the dilemma that many people now have: heating or eating. Sadly, in some cases, they can afford to do neither, because they cannot even turn on their gas hobs to heat their food. She highlighted the failings in the design of the oil and gas profits levy, and the obscene oil and gas profits that are being realised. That was another common theme from speakers. The hon. Member rightly highlighted the success of smaller countries, such as Norway, Denmark, Iceland and so on, in public ownership and leading the way in the renewable transition. That is not lost on us MPs from Scotland.

The hon. Member for Leeds East (Richard Burgon) asked: who actually owns the energy companies at the moment? We keep hearing the UK Government talk about energy security, yet they are quite happy to have many foreign owners of our energy companies. That is a real paradox. The response to the last written question I tabled about the consortium building Sizewell C showed that China General Nuclear still owns a 20% stake. When will the Government realise that that partnership should be dissolved, and that they need to end their obsession with Sizewell C?

The hon. Member for Leeds East mentioned social pricing structure; I would call it social tariffs. Now is the time for that to be considered. We need layered tiers based on usage, because we all know that people on the lowest incomes use the least amount of energy, so they would benefit from that. We can also use social tariffs to protect the most vulnerable. It is much more progressive, because those who can afford to pay more for the energy that they use do so.

The hon. Member for Ilford South (Sam Tarry) made the final Back-Bench contribution, which started with eye-watering figures about the tragic consequences of fuel poverty. The reality is that fuel poverty kills people. Roughly 10,000 people a year die prematurely because they cannot afford to heat their homes. That is a national scandal that needs to be remembered. I would like the Minister to explain how the Government will address that, because we cannot let that scandal continue. Clearly, it will get worse, as fuel poverty rates have increased massively. Have the Government even assessed what that means for future excess deaths?

A year and a half ago, the so-called price cap was £1,100 per annum for an average household. Now people are expected to be grateful for the support package that the Government announced, which is equivalent to £2,500 per annum for an average household. My hon. Friend the Member for Linlithgow and East Falkirk highlighted the fact that the previous Prime Minister did not even understand her own policy. She kept stating that she was ensuring that people would not pay more than £2,500 for their bills. Average bills in Scotland are likely to be £3,300 even under the support scheme. That shows the gravity of her misinformation. Too many people will be under the illusion that their bill will be smaller than they actually will be. Frankly, it is dangerous for people’s financial management.

The Government’s own impact assessment for the Energy Prices Act 2022 estimated that the support package would prevent average bills from rising to over £4,400 come January 2023. The former Prime Minister was claiming that the support package would prevent energy bills from rising to over £6,000 per annum. Given that the UK Government made the last-minute decision to slash the support period, will the Minister advise us what he thinks Ofgem’s cap level will increase to for the 22 million or so dual fuel customers who are currently on standard variable tariffs when the support package ends in April 2023? When will the Government announce their plan to protect the most vulnerable, as they claim they will?

The reality is that more and more people are already in debt, and they have been put on to prepayment meters, so why is the Government’s support package not even contingent on not forcing more people on to prepayment meters, which have higher standing charges? National Energy Action estimates that with the current support package, there will still be 6.7 million households in fuel poverty. Can the Minister provide an estimate of how many people will go into fuel poverty come April 2023, when the support package ends? How many households do the Government think are vulnerable enough to merit further support, and when will we hear what that support package will look like?

Fuel poverty on this scale is why people are angry and want a more serious debate about the merits of nationalisation and putting people before profits. They know that the energy profits levy for oil and gas companies does not go far enough, and that the investment allowance of 91p in the pound perversely incentivises investment in fossil fuels over renewable energy. For too long in the energy retail sector, the excess profits being made by the big six were deemed acceptable by the Government. When they eventually moved to a price cap, the truth is that it came in too late, because by that time the market was being squeezed by new entrants that thought that they could come in and make easy money in the energy retail sector. Thirty companies have gone bust since July 2021 and many of them had been using customers’ money for their cash flow, effectively operating their own Ponzi schemes while the Government and the regulator were sleeping on the job. The reality is that, unfortunately, it is now billpayers who are picking up the tab for these losses and covering the customer credit that these companies effectively stole. Why has there not been stronger action to bring the guilty people in these companies to account?

The largest energy company to go into administration, as the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) pointed out, is Bulb, which has cost the taxpayer billions of pounds. What is the Government’s estimate of the special administration regime costs for Bulb? What we have seen in this energy market—and in the retail market in particular—is similar to what we have seen in other markets, particularly the rail market: profits are being privatised, but the debts and the risks lie with the people. How can that be a fair system?

While Bulb was in a special administration regime, its chief executive was still allowed to pick up his salary of £250,000 a year, supposedly for his expertise. That is the same man whose expertise took the company into administration. Only a Government who see raising bankers’ bonuses as a priority could think that that chief executive should have been kept in place with a £250,000 salary.

Another example of privatising profit while taxpayers take risks is something I touched on earlier—the Government’s obsession with new nuclear power. Hinkley Point C is nearly 50% over budget and EDF’s latest programme shows that it could be 2030 before both units are operating, which would be five years behind schedule. Yet the Government still tell us that replicating the world’s most expensive power station at Sizewell is the answer to our cost and security crisis.

It beggars belief that the Government want to give EDF a 60-year contract while moving the risk on to the bill payers under the regulated asset base model of funding. This is a project that the Government’s own impact assessment shows could cost £63 billion for capital and borrowing costs. We have a classic example of how the free market in nuclear energy generation has completely failed, yet the Government are stepping in to the market to support a fully nationalised French company and transfer the risk to UK bill payers.

What frustrates me is that Labour continues to goad the Tories to build even more nuclear power plants. It is groupthink madness and it is tying up future generations of bill payers to pay not only for these costly new power stations but for the nuclear waste legacy, which is already estimated to cost about £140 billion. How will that approach reduce bills in the future?

Switching slightly, if we look to Scotland we see that it provides an example of a nationalised utility company that has kept all its assets under public ownership: Scottish Water. Water and sewerage bills are cheaper in Scotland compared with the rest of UK water companies; comparative performance is better, as measured by the regulator; and of course any surpluses or savings are reinvested. By contrast, the privatised water companies south of the border have taken something like £60 billion in dividends since privatisation and, as we know, sewage discharges into rivers and seas by these private water companies are out of control. Will the Minister comment on the comparative success of the nationalised utility company in Scotland and say what lessons can be learned from that? In a similar vein, what assessment have the Government made of the dividends paid out in the energy sector over the years with regard to risk and balance, and whether the dividends paid by the energy companies have indeed been excessive?

When we look at the oil and gas industry elsewhere, we see what nationalised companies have achieved in returns for the benefit of their citizens. In Norway, Statoil generated profits for the citizens of the Norway while the Norwegian Government still took taxes and put some of that money aside in a sovereign wealth fund, which now sits at $1 trillion, making it the largest such fund in the world.

That energy company, which is now Equinor, operates in 30 countries around the world and has massively diversified into renewable energy. Although it was technically privatised, the Norwegian state is still the majority shareholder, with a 67% shareholding. It really is the ultimate success story, whereas in Scotland’s case, we know that by comparison the UK, with broad shoulders, has squandered all the oil and gas revenues—some £380 billion over the years.

Independence will allow the Scottish Government to create an investment fund that would invest in renewable energy; could be used to support the decarbonisation of homes; and could take stakes in renewable generation while also levering in private investment. The Energy Prices Act gives the Secretary of State powers to buy energy assets. Is that a nod away from ideological opposition to all forms of nationalisation, and can the Minister tell us whether the Government will be using those powers to buy some energy assets, for which the Energy Prices Act allows?

I have highlighted a lot of the benefits of having publicly owned assets—for instance, the success of Scottish Water—but I do not believe that now is the right time to renationalise energy companies in full. The amount of money to pay out is untold billions, and it will scare off future investors and the market. The only estimates on costings that I have found are from the Centre for Policy Studies which, I accept, is a right-wing think-tank—not necessarily one that I would normally utilise. The CPS estimated that it would cost something like £55 billion to nationalise transmission assets, but £185 billion to nationalise the entire sector. Those are eye-watering sums that might not be manageable in this difficult climate.

The same principle applies when Scotland becomes independent, because there is no point creating additional debt and investor turbulence. However, that does not preclude a Scottish energy company being set up and working in collaboration with the private sector on a mixed-equity basis to ensure that maximum investment is levered in, but also that the state gets returns for the good of the population and revenue streams that allow for reinvestment.

With independence, we can end the ridiculous situation whereby people in the highlands of Scotland pay a surcharge on their electricity bills while renewable energy generation in the highlands supports the rest of the UK. They are bringing down bills across the UK, while they pay a surcharge on their own bills. It is completely topsy-turvy and unfair, and it something that the Government refuse to address. Again, it is another inequity that only independence will resolve. Although Scotland is an energy-rich country, we do not yet have the powers to unleash our potential and create a fairer society, but I have a feeling that that day is coming, and I look forward to the response from the Minister.

[Mrs Sheryll Murray (in the Chair)]

Before I call the shadow Minister, I understand that people watching the debate online were unable to view the first 20 minutes. I reassure anyone watching that the full recording of the debate will be made available online later.

I call the shadow Minister, Dr Alan Whitehead.

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[Mrs Sheryll Murray (in the Chair)]

Order. I remind the hon. Gentleman that he should address the Chair.

[Dr Whitehead]

I apologise, Mrs Murray—I will face the right way from now on.

The grotesque result is that Shell has stated that it has not actually paid any windfall levy because it has got it all back through that loophole. Customers see that the regulation of the system is so dreadful that they are paying enormously high prices for their power as if all of it came from gas, even though half of it now comes from much cheaper renewables. That is because the market is regulated in such a way that the marginal cost of gas provides the whole of the price for the market, and it is a substantial part of the reason why prices are so high. In short, customers have seen for themselves a thoroughly broken energy system in operation. They have perhaps concluded that the privatised norm of the last 30 years has failed, and that placing energy back in state hands is the relatively straightforward answer.

What a delight it is to see so many Conservative Members in the Chamber to support their Government’s response, which states:

“The Government does not agree that nationalisation of energy assets is the right approach. Properly regulated markets provide the best outcome for consumers as a driver of efficiency and innovation.”

Wouldn’t it be nice if proper regulation did drive energy efficiency and innovation? We know that it simply does not; the failure of proper regulation is at the heart of the many problems in our energy markets. We also know that the Government themselves have recently resorted to measures that might be compared to nationalisation.

As my hon. Friend the Member for Wirral West (Margaret Greenwood) said, Bulb—the seventh largest retail energy company in the country—went bust a little while ago, along with 40 other retail energy companies. Bulb, however, was regarded as too large to fail and was effectively nationalised by Government. It was put into special administration and has sat there for quite a while, at a cost to taxpayers of about £3.5 billion. It has just been sold for scrap, as it were, with its customers being transferred to Octopus Energy for, we think, several hundred million pounds—far less than the amount that taxpayers put in as a result of the Government’s reaction to appallingly bad regulation. Does the Minister have further information on exactly how much Octopus paid for the remains of Bulb, so that we can get an accurate grip on how much money has been retrieved from that episode?

An energy Bill that was recently mysteriously withdrawn by the Government proposed that the operator of the national transmission system be fully detached from National Grid and placed in the public sector. That means that it would no longer be a part of National Grid, even at a distance. As set out in the Bill, the future system operator would have full power to plan the system, commission investments in it, and run and balance the system overall as a public sector organisation. However, as I say, that Bill has mysteriously disappeared, but I would be interested to know whether the Minister continues to support the idea that the future system operator be a company in the public sector, not the private sector. I would also be interested to hear when that energy Bill will return to Parliament, if at all. It contains a great deal of things that could lead to better regulation of the energy system, which is exactly what the Government are saying is the alternative to nationalising it.

Although it is true that part of the answer to the problems we face in the energy system at the moment is proper regulation—and the Government have an enormous amount of work to do get it properly regulated—we also have to give careful consideration to where our energy system is going now, because it will not be successful in reaching its targets, particularly in the low carbon context, if we simply continue the privatisation experiment of the past 30 years. Of course, the energy system is changing before our eyes. All the old considerations about 80 or so power stations providing power for the grid and then to customers through retail sales are effectively disappearing. We now have about 1.5 million inputs that are owned by all sorts of different people. Indeed, some of that input is from companies and bodies that are not in the private sector, but are community owned or locally owned. There are all sorts of generators providing a different form of input to the grid.

Of course, the grid itself is changing rapidly. National Grid Electricity System Operator, the forerunner of the future system operator set out in the energy Bill, considered in a recent holistic design plan that accommodating the new way in which the energy system is going to work, and making sure that it works well in future, would require a huge recalibration of the grid system, both onshore and offshore, at the probable cost of about £62 billion. An enormous amount of investment is needed to make the future energy system secure, and to get the green and low-carbon generators into it for the future. We will not sort that out by just hoping that somehow the market will come to the rescue and provide all the investment for the future based on our current regulation and system. My hon. Friends the Members for Wirral West, for Leeds East (Richard Burgon) and for Ilford South (Sam Tarry) both pointed to how that needs to be done. Perhaps we should not have to rely on the private sector to come to the rescue and sort out the future system.

The Labour party wants a Great British energy company —a publicly owned company at the heart of investment and driving forward, planning and managing that new energy system. As my hon. Friends have pointed out, that company would stand alongside companies elsewhere in Europe that have already started that energy revolution with investments not just in their own countries but on an international scale. Companies such as Vattenfall in Sweden, which owns the largest onshore wind farm in the UK, Ørsted in Denmark, Equinor in Norway and a number of others across Europe are making investments in the future system and, moreover, keeping the equity in those investments for the people of the countries on whose behalf they are working. Either individually or in partnership with the private sector, they are turning over those investments for those people, and keeping their equity in them.

In this country, as members of the public and customers we are spending enormous amounts of money each year on providing energy transmission and distribution companies with the means to invest in the grid system—the assets of which stay with those companies, even though we the public have paid for those assets. That is also the proposal for the new nuclear programme—we pay the money, they get the asset—but a Great British energy company would put a stop to all that. The assets would stay with the public and the money would come back to the public purse. That is the right approach. Our investment ought to go towards producing our future energy system.

I reject the Government’s idea that this will all happen via better regulation—though it would be nice if that did happen—and the operation of the market. We need to be much smarter than that. I do not agree that we should nationalise the energy system as it stands. Among other things, if a lot of the junk and clapped out stuff in the energy market were nationalised, the people who own those stranded assets would be delighted to have them put out to grass and taken off their hands as the energy system changes, so that they could run off with the compensation money.

We have to think smartly about the future of our systems. They will certainly not be funded, run or sorted out on the basis of the failed privatisation experiment of the last 30 years.

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[Dr Whitehead]

We have not got a policy of nationalisation. The Minister is not telling the truth.

[Mrs Sheryll Murray (in the Chair)]

Order.

[Dr Whitehead]

Sorry—I am getting very annoyed about this.

[George Freeman]

Thank you, Mrs Murray.

We have heard nothing today about the really exciting opportunities in our energy sector: the new renewables, including those in marine, tidal, geothermal, hydrogen and fusion, that this Government and I, as Minister with responsibility for research, are supporting. There are also opportunities for the UK’s cleantech sector—the small and large companies that are in the frontline of developing global solutions for new energy. We have heard nothing about the smart grid, the importance of incentives or the digitalisation of the grid to create a micro-market and bring net zero down to the ground in different communities. We have heard very little about energy use. We have heard a lot about generation, but very little about how transport and agriculture—the two big industries on the frontline of energy usage—are making huge strides in decreasing their reliance on energy. Instead, we have heard quite a lot of the old dogma of decline.

To be honest, I think that explains why there are so few colleagues from other parties here this afternoon; most of them are more interested in trying to develop practical solutions. I honestly think that the 100,000 people who petitioned for a proper debate about long-term energy strategy deserve something slightly better than we have heard today, and the Government are determined to provide it.

[Mrs Sheryll Murray (in the Chair)]

Mr Martyn Day, you have two minutes to wind up.

Scottish Devolution Settlement: Retained EU Law

Sheryll Murray Excerpts

Wednesday 19th October 2022 Westminster Hall

[Mrs Sheryll Murray (in the Chair)]

I wish to make a short statement about the sub judice resolution. The question whether provisions in the draft Independence Referendum Bill relate to reserved matters under the Scotland Act 1998 has been referred to the Supreme Court and a judgment is anticipated in the coming months. I am exercising the discretion given to the Chair to allow reference to the issues concerned, given their national importance.

[Brendan O'Hara (Argyll and Bute) (SNP)]

I beg to move,

That this House has considered the impact of retained EU law on the Scottish devolution settlement.

It is a pleasure to see you in the Chair for this morning’s debate, Mrs Murray, and I welcome the Minister to his new post.

Should this shambles of a Government manage to stumble on past the weekend, we are being told that their Retained EU Law (Revocation and Reform) Bill will come before the House on 25 October. The Brexit freedoms Bill, as the Government like to call it, will give UK Ministers unprecedented powers to rewrite and replace almost 2,500 pieces of domestic law covering matters such as environment and nature, consumer protection, workers’ rights, product safety and agriculture, and that will be done with the bare minimum of parliamentary scrutiny. It is, in short, an ideologically driven deregulatory race to the bottom that will do enormous damage to our society and our economy.

The Bill, taken in conjunction with the United Kingdom Internal Market Act 2020, will fundamentally undermine and alter the devolution settlement by giving primacy to UK law in areas that are wholly devolved, such as environmental health, food standards and animal welfare. Today, I thought it would be useful to consider the Bill to examine what it could mean for Scotland and for the devolution settlement. I believe that any objective analysis would see not only that it puts at risk many of the high standards and protections that the people of Scotland have enjoyed and come to expect from more than four decades of EU membership, but that it is part of the Government’s long-term plan to undermine the devolution settlement and weaken our Scottish Parliament.

Under the Bill, and with the 2020 Act already in place, any legislation passed by the Scottish Parliament could be undermined by a Government here in Westminster whom we did not elect, even in matters that are wholly devolved. I will give a few examples. In the area of food standards, if the Scottish Parliament decided that we would remain aligned with the European Union and would ban the sale of chlorinated chicken, but this place decided that cheap, imported, chlorine-washed chicken was acceptable, there would be almost nothing the Scottish Parliament could do to stop lorryloads of chlorine-washed poultry crossing the border, with that chicken then appearing on our supermarket shelves.

Similarly, if the UK agreed a trade deal that saw the UK flooded with cheap, factory-farmed, hormone-injected meat, but the Scottish Parliament decided to protect Scottish consumers and Scottish farmers by adhering to the standards and protections that we have up to now enjoyed, under the terms of the Bill—again, backed by the 2020 Act—Westminster could override that and Scotland’s supermarkets could be inundated with inferior-quality cheap cuts of meat that under existing EU law would get nowhere near our supermarket shelves.

--- Later in debate ---

[Ian Murray]

That is more fantasy from the SNP. I find it strange that, when we have a Government on their knees bringing forward a piece of legislation that ultimately could undermine devolution, the main part of the hon. Member’s speech was an attack on the Labour party. That maybe tells us that our ascendancy in Scotland is worrying the SNP.

Let me say what would have happened. The hon. Member calls the Labour party hard Brexiteers; had the SNP not abstained on the amendment for the customs union it would have passed in Parliament—a matter of public record. The SNP spent less on the EU referendum than it did on the Shetland Scottish parliamentary byelection—to win 3,400 votes. The SNP asks about where we are as a country at the moment. It is perfectly practical for the Labour party, who wish to be the next Government, to try and make Brexit work. The first day that my right hon. and learned Friend the Member for Holborn and St Pancras (Keir Starmer) walks into No. 10 as the Prime Minister, he is going to face the circumstances of the day, not those that we may wish to find. The first task will be to make what we have got work, the second task will be to build and deepen that relationship with Europe, and the third task, which overarches all of that, is to do what is in the national interest. That is clear.

That shadow Chancellor was actually saying that part of the problem we have in this country with the immigration system is the Home Office not processing applications for asylum quickly enough, which leaves the massive backlog of tens of thousands that we have at the moment. If hon. Members had listened to what she actually said, that is what she was referring to—which I think is SNP policy? If the Home Office was processing applications in a timely manner, and in a humane way, we could get through applications much quicker, lessening those issues.

Where was I with the hard Scexiteers? I think we had gone through that. I will get on to some of the issues raised about what the Retained EU Law (Revocation and Reform) Bill will do. I hope the Minister will tell us what the Government’s plans are, because this is essentially a theoretical Bill about trashing, amending, or otherwise, EU retained law in this country. The Government always have those grand phrases, but they do not tell us what they are going to do. Can the Minister answer my first question: what would take several years if it was not in the Bill? Will the Minister give us an example about what he wishes to do with some of those regulations? I would be happy to listen to that.

The Labour party wants to use that platform to put in a new deal for working people. That is a prime policy example. That would give people workers’ rights from day one and it would build on EU regulations that we have already had. Incidentally, the UK has always gold-plated EU regulations. In fact, Conservative Governments have always gold-plated EU regulations. The Labour party would end fire and rehire and zero-hour contracts—is that part of the Government’s strategy? We would make work more family friendly and flexible. We would strengthen trade union rights, which would raise pay and conditions. We would roll out fair pay agreements, and we would use Government procurement to ensure that we could lift standards, pay, conditions and skills right across the country.

Our new deal for working people is a practical example of what we would do with regulations, rather than a Bill that says we will rip up every piece of EU regulation without saying what we would do instead, while, at the same time, undermining devolution.

I will ask one final, two-part question to the Minister. What discussions is he having with the devolved Administrations about the Bill, and about trying to achieve a consensus so that legislative consent motions can be passed? The Sewel convention—which was right—was put on a statutory footing under the Scotland Act 2016 by an amendment brought forward by the Labour party. We cannot just disregard that; the Sewel convention is clear that the UK Government will not legislate in devolved areas where they do not need to. If they do, a legislative consent motion must be positively passed by the Scottish Parliament—not the Scottish Government. What discussions is he having to make sure those legislative consent motions can come forward?

I am grateful that the debate has been brought forward, and that we have had the hard Scexiteers and hard Brexiteers arguing over the EU. However, yet again we have had a combined 37 minutes from three SNP Members, and they have not told us one iota about how they can get back into the European Union with the huge deficits they have, no currency, no central bank, no lender of last resort and no immigration policy—[Interruption.] Now they are claiming that I am slagging them off, but they spent a lot of their speeches slagging off the Labour party. I look forward to the Minister answering some questions, and maybe at some point in the future we will get some answers from the SNP as well.

[Mrs Sheryll Murray (in the Chair)]

I welcome the Minister to his place.

Oral Answers to Questions

Sheryll Murray Excerpts

Tuesday 22nd February 2022 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

This Government have been really clear that such practices should not be used as bully-boy negotiating tactics. Employers should refer to the strengthened ACAS guidance that sets out that dismissal and re-engagement should be considered only as an option of last resort.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

T10. Cornwall is famous for its creativity and its inventions—whether it be Richard Trevithick’s steam engine, Cornishman Richard Lower, who did the first blood transfusion, or Sir Humphry Davy’s lamp. What assurance can the Government give that research and development funding is getting to Cornwall?

[George Freeman]

My hon. Friend is an outspoken advocate for the Cornish cluster, which is growing fast. In addition to our groundbreaking pledge to increase investment in R&D outside the golden triangle to 55%, we are specifically investing in the South West Centre of Excellence in Satellite Applications, the Newquay Spaceport and work with the University of Exeter and Virgin Orbit. This is an exciting time for the Cornish economy.

Climate Change Committee Progress Report 2021

Sheryll Murray Excerpts

Thursday 21st October 2021 Westminster Hall

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Thank you, Sir Christopher. I am always guided by your wisdom. I will attempt to restrain my remarks as much as possible, although, I am not sure whether I can get them done in 45 minutes. I hope I will be much briefer than that, because quite a lot of what I wanted to say this afternoon has already been said. That is a reflection of the very high quality debate that we have had.

I do not want to go overboard about this and start saying things such as, “Better fewer, but better”—better being the watchword for these sorts of occasions—which is actually a quote from Lenin, but it reflects very well on the Members present. I could not have asked for a better group of parliamentarians to debate this issue. Between us, we have addressed in a sober manner both the pluses and the minuses of where we stand on emissions. For the second day running, I congratulate the hon. Member for South Cambridgeshire (Anthony Browne) not only on securing the debate, but on the quality and content of what he had to say. I know that is probably a career-limiting move on the part of an Opposition Front-Bench spokesperson, but I really think that the hon. Gentleman did ample justice to his brief, albeit perhaps he pulled some punches a little because of his party political position. Overall, his speech was a sound and good exposition of both the pluses and minuses of our progress on climate change.

[Mrs Sheryll Murray in the Chair]

I will come back to one or two things that the hon. Gentleman said, but I also want to say that valuable additional points were made by Members from my party and the Scottish National party. My hon. Friend the Member for Rochdale (Tony Lloyd) emphasised the importance of buildings, heat pumps and the seismic change in delivery that we have to get into over the next period. Those were well made points, which reflected how we talk about what we have achieved so far and what we have to do in the future. That is a central point in our discussions.

My hon. Friend the Member for Bristol East (Kerry McCarthy) made some important points about transport and the difference between what we think we have achieved by putting something down on a piece of paper, and, when we follow it through, where we think that has got to. That was exemplified in her comments on the 900 buses that have allegedly been procured. Indeed, I was present at the visit to the buses yesterday, along with her and other hon. Members. That exemplified that we have some things that are an obvious next step in the decarbonisation of the transport sector. If it is possible to embrace an entire bus, we should be running off with those examples and planting them everywhere in the country as quickly as possible, yet we appear to be falling down badly in terms of how we roll out that fine ambition over a period of time.

My hon. Friend the Member for Leeds North West (Alex Sobel) emphasised the role that local government and a cross-departmental approach can play in the fight to reduce emissions across the board. He made a number of very telling points about what local government can and cannot do, and how much needs to be entrusted to local government in order to bring about emissions reductions.

I return to one or two of the comments made by the hon. Member for South Cambridgeshire. He made the important point that if we are to have a balanced assessment of where we have come from and what we are trying to get to, we should neither condemn a Government—or, in this case, the two Governments we have had from the turn of the century to today, or three if we count the coalition—for doing nothing, nor praise them for doing everything. We have to have a clear line between those two positions to make a sober assessment of just how much we have to do, and to place our successes and failures so far in context.

As the hon. Member also said, it is only possible to decarbonise our power sector once, which is an important observation for our record so far. Some people, talking about where we have got to, might say that we have done better than a number of other countries in the world, that we have reduced emissions substantially while expanding our economy, and then stand back with folded arms and say, “There we are—it is pretty much done, isn’t it?” The Climate Change Committee’s report gives a telling antidote to that stance. It draws our attention to not just changes in UK emissions over the period 2000 to 2020, but changes by sector.

A useful chart appears on page 20 of the report—I see hon. Members flicking through their copies to find it—which shows that there has been a stupendous change in emissions from electricity supply. We have done a fantastic job of decarbonising our emissions from electricity supply, which have plummeted from annual emissions of about 160 megatonnes of CO₂ in 2000 to less than 45 megatonnes of CO₂. We see the wisdom of the point made by the hon. Member for South Cambridgeshire—we can only decarbonise these things once. Although we should go much further, and it is good that we have seen a proposal for the complete decarbonisation of the power sector by 2035, we will not be able to repeat that reduction in emissions in that sector, so we cannot set that achievement against what we need to do next in the areas we need to concentrate on for the future.

That same chart is alarming in a number of areas. We must enter a caveat about the deep reduction in emissions from aviation and surface transport during the pandemic, because all the evidence already suggests that they will pretty quickly return to their previous levels. In general, despite some reduction in emissions from manufacturing and construction over the period and a smaller reduction in buildings—albeit a flat line in recent years—emissions in most other sectors are flat or increasing. That means that, in effect, measures in those sectors either have not started or have been completely ineffective in reducing emissions. As we look at the overall picture, it is important to be able to say, “We have done well here and we have done badly there,” and, when we are judging the totals, we must carefully take that into account.

We must also carefully consider the proportion of emissions in those sectors. For example, electricity supply—power stations—currently accounts for 15% of emissions. Yes, we can achieve a reduction in emissions there, but those emissions as a percentage of total emissions are now about the same as those from agriculture and land use, yet emissions from that area have stayed static in the period. Therefore, among other things, if we continue to make progress in particular areas, as has been described, but others stay static, they will represent an increasing, and increasingly intractable, part of our emissions over the next period. To do nothing about aviation, shipping, surface transport and, certainly, agriculture and land use, or to ignore them or put them in the background, is nearing criminal. If we leave them out, they will be impossible to pull back later.

We need to look at the progress made under the plans in those areas and how well they are getting us towards the same emissions curve as we see in the power sector, and as soon as possible. In that context, the Climate Change Committee’s report to Parliament is telling. The committee is the most polite organisation that one could come across. Not only is it unfailingly courteous in personal dealings with Members but all its reports have “courteous” written through them, like a stick of rock. It does not jump up and down and scream, and it does not over-hype its statements; quite the opposite. Where necessary, it is careful to caveat them as far as possible. In those circumstances, it is sometimes accused of being a bit soft. I do not think it is, but it is rigorously careful and accurate in what it tries to do.

However, in reading between the lines, the progress report is a pretty coruscating condemnation of progress, particularly in the areas that I have represented to hon. Members. As hon. Members have mentioned, page 24 of the summary report shows the areas where progress falls far short of the Government’s stated ambition and commitments. In some areas the Government’s commitment meets what the Climate Change Committee said should be the pathway. However, in a number of other areas their commitment is failing very badly, and those areas represent a large chunk of the overall emissions coming down the road, while those where they are succeeding often account for relatively small amounts of emissions. We need to try to get that into proportion as well.

Looking at what the Climate Change Committee said, something that we ought to think carefully about, which we have not done particularly this afternoon, is that the progress report is about not only mitigation but adaptation. Although there is a separate adaptation report, it comes under the overall ambit of the general report to Parliament. On adaptation, the committee says:

“A robust plan is needed for adaptation. The UK does not yet have a vision for successful adaptation to climate change, nor measurable targets to assess progress. Not one of the 34 priority areas assessed in this year’s progress report on adaptation is yet demonstrating strong progress in adapting to climate risk. Policies are being developed without sufficient recognition of the need to adapt to the changing climate. This undermines their goals, locks in climate risks, and stores up costs for the future.”

That almost sounds not terribly polite. It is waving a red flag about the disgraceful complete lack of any plan for serious Government action in this country on adaptation, which will really turn around to bite us in the near future if we do not get our act together. If the hon. Member for South Cambridgeshire is minded to apply for a further debate in this Chamber, I would suggest a specific debate on adaptation. It is a very important area, which we have largely missed out on, and we do so at our peril.

The committee’s report also reflected on the fact that, at the time it was written, the Government were in the process of producing a number of reports that had been promised for quite a while but had not arisen, such as the net zero plan, the transport plan, the hydrogen plan, and the heat and buildings strategy, which the Climate Change Committee was unable to incorporate into its report to Parliament because they were still anticipated. Just this week, no fewer than 1,800 pages of material finally came tumbling out of the Department for Business, Energy and Industrial Strategy, the Treasury and so on, with 10 days to go to COP26, rectifying a number of those emissions. I am afraid that, try as I might, I have not been able to get through all 1,800 pages by any means. It is apparent from reading those just how far off we are from getting to grips with things that the Climate Change Committee mentioned in its report.

Let me take the “Heat and Buildings Strategy”, which has just come out, as an example. I do not particularly blame the Department for Business, Energy and Industrial Strategy for this, and hon. Members will have to take it from me, but the “Heat and Buildings Strategy”, which is an interesting report, has been written, in what we might call Shakespearean authorship analysis, by several different hands—I do not include the Minister in that. Broadly, I can say that the right questions have been written by one series of hands, and the wrong answers have been written by another series of hands, so the report does not cohere.

The answers to the ambition that the Climate Change Committee was concerned to underpin in its report to Parliament are not very ambitious at all. There is a really lame response to the question of how we go about the insulation and energy efficiency uprating of our homes, which, as everybody knows by now, is a sine qua non of a load of actions in other areas, as we have mentioned already.

The hon. Member for Kilmarnock and Loudoun (Alan Brown) unpacked some of the issues on heat pumps. We know that they will not work in badly insulated homes. We have an ambition for heat pumps, but there are all sorts of issues even within the report about the difference between the ambition of 600,000 heat pumps a year by 2030 and the practical issue of who will be trained up to install them, whether they will be manufactured in this country, and which sectors will have heat pumps in them. I note, for example, on the Government’s ambition for 300,000 homes a year, that it is suggested that heat pumps will go into only about 60% of them, so we have the prospect of new homes being built with gas boilers in them, which will have to be retrofitted pretty shortly afterwards, but we will perhaps let that pass us by.

On how the paper addresses our overall ambitions, the sector, as the strategy sets out, occupies 23% of emissions just on heat. So when we talk about the energy sector, we are talking about heat being much more important in terms of emissions than power, and it is heat that we have made virtually no progress on at all. The overwhelming majority of our homes are still heated by gas, and that figure has remained fairly static for a fairly long time. A strategy that proposes more heat pumps only works if we deal with other heat factors, particularly how much heat we lose from our buildings, how meaner we could be in our use of heat in buildings in future, and what sort of win-wins we might have in insulating our homes, and we must deal with fuel poverty and various other such things.

One would think that a strategy of energy efficiency should run alongside everything else that we do on heat generation. That one thing, with the exception of some short-term, fairly small amounts of funding for particular projects in the strategy, is sorely missing. I do not know, but I would speculate, bearing in mind the different authors of the report, that perhaps a much more ambitious strategy was in the minds of BEIS, and certain other people came along and crossed a nought off the end of each of the amounts of money in the strategy. It woefully misses the opportunity to really go forward on getting heat firmly in our sights as far as decarbonisation is concerned.

The hydrogen strategy that has come out is interesting, premised on the progress report to Parliament. It does not have any path by which we can develop green hydrogen, which of course is the element of hydrogen that will do the work of decarbonisation. Unless we have a decent path for developing green hydrogen over the period, we will not make the progress that we should on climate change and emission reductions.

As I said, I have yet to go through all of this, but I think we are simply not articulating our own ambition on carbon reduction and getting the details of how we do it right. Indeed, not only are we a long way from that in some instances, but in others we are not even addressing it. I am interested to reflect on the points made by my hon. Friend the Member for Leeds North West about the nudge unit report that came out recently. It was nudged into public view and pretty immediately nudged out again, within I think a day of being published. One of the reasons for that is because the nudge unit drew our attention to some very difficult areas that we have to get to grips with, but we have hitherto walked on by on the other side of the street.

I know that to my cost. Recently, I think at a fringe meeting at the Labour party conference, I ventured the opinion that we will have far fewer livestock farmers in our country in 20 years’ time. That is a straightforward statement of understanding of what we have to do in the agricultural and land use sector, what we have to do about our diets and how we deal with emissions in our food chain, and many such things. I got absolute grief. Indeed, I got a number of angry invitations in my in-tray to visit some farms and see what is really happening, and so on. I know it is a really difficult issue, and that we will have to do a lot of just transition-type work in getting it right, but it is an issue that we have to face. I am afraid that the Government are not doing that in a number of areas as far as emission reductions are concerned.

My conclusion, which I hope will be pretty widely shared across the Chamber, is that although we have done well so far in our emission reductions process, we need to unpack that to understand where we have done quite well and where we have done badly, so that we have better pointers for the future. As things stand, we appear to be nowhere near meeting the challenges ahead of us on climate change reduction. A lot more new policies and new thinking will be needed to get us anywhere near those targets. Regrettably, as the strategies come out they do not appear to rise to that challenge. I hope that this afternoon the Minister will be able to respond to the debate in that vein, because I hope that I have given a reasonably accurate picture of what the Climate Change Committee says and what hon. Members have said in this Chamber today.

I have not quite taken my 45 minutes, Sir Christopher—[Interruption.] Sorry, Mrs Murray; while I was talking, you snuck into the Chair.

[Mrs Sheryll Murray (in the Chair)]

I snuck in.

[Dr Whitehead]

Obviously, the previous Chair just could not stand the idea of being there for the entirety of my speech and has left.

I hope that this debate will serve as almost a watchword for how we approach our task over the next period. We need to work soberly, carefully and, as far as possible, on a consensual basis, for the future of our climate goals, but also with a clear-eyed recognition of just how far we have to go and how difficult many of the choices will be. We need to face them together, creating solutions that can actually work in our national and, indeed, international interests.

By the way, even though it was very late in the day, I understand just how much work has gone into these documents and how hard people have worked at getting them out, and indeed how they have attempted to address the choices in front of us in a real way. I do not underestimate any of that. My criticisms are based on what we have to do politically to address these issues for the future. I am not in any way attempting to denigrate the people who have put these documents together.

That is the offer from the Opposition, and that is what we want to do—to move us forward in the face of this tremendous challenge and the really daunting task ahead of us. And if we can manage to conduct our future debates as well as we have managed to conduct today’s debate, that will be a great help in this process.

--- Later in debate ---

[Anthony Browne]

I thank everyone for what has been an excellent debate, as various other Members have commented. We clearly have a shared ambition and this afternoon’s discussion has been 90% policy and only about 10% politics. It has been incredibly civilised—although I am rather worried that the hon. Member for Southampton, Test (Dr Whitehead) praising me so much has completely ruined my political career before it has even begun.

I will not go through all the different points because the Minister did it so effectively and he is in charge of the policy, but I want to highlight a few things that people have said. The hon. Member for Southampton, Test rightly pointed out that power had gone down very quickly and had gone down less in other sectors. There is some rationale behind that. I wrote about electric vehicles and I test-drove them about 20 years ago. The common complaint then was that they were transferring pollution from city centres up to the valleys where the power stations were, because electricity was largely produced by coal then.

It is not any greener to drive an electric car if the electricity that powers it comes from coal. Electric vehicles and other aspects of the transportation system, such as electric trains, as well as the heat pumps that we have been talking about, can be far greener if the electricity they use is decarbonised. I do not know whether that is deliberate on the part of the Government, but decarbonising electricity first and then going to the other sectors that are more difficult to decarbonise does make a sort of sense from a climate point of view.

A couple of comments were made about airport expansion, such as by the hon. Member for Bristol East (Kerry McCarthy), and someone mentioned road expansion. The Minister said that any expansion of airports would only be compliant with our commitments to net zero, and that is absolutely right. I get very involved in road conversations in my constituency because it is a big issue locally. When cars reach net zero—when we all have fully electric cars and the production of cars is carbon-neutral as well, which if we decarbonise industry will happen—having more cars driving around will not have any impact on climate change. I realise that that is some way off and that congestion would then be more of an issue, so the different rationales for adjusting cars, airports or whatever will be different. I think net zero aviation is a very long way away.

One thing that I did not touch on, but which the Minister and others did, is the economic opportunity. I have been an economics correspondent, I am on the Treasury Committee, and I used to run the British Bankers Association. I focus very closely on economic issues and I have become more convinced that all the talk about green jobs is not just greenwashing but is actually genuine. There really are economic opportunities for us, particularly if we become a world leader in sectors ahead of other countries. We have been a bit behind on heat pumps so far, but if we make the progress that I hope we will make, it will create an industry that we can start exporting to other countries a lot more. We talked about that when we debated carbon capture, utilisation and storage yesterday. There is a huge economic opportunity in terms of exports.

We have had various discussions on nuclear. There was a bit of disagreement—some of us like nuclear, but some of us do not. I want to share a little observation. I went to Chernobyl village once—again, it was about 20 years ago. I went with the United Nations, which had done an investigation of the long-term health consequences of Chernobyl and concluded that they were absolutely minimal. From memory, I think about 40 people died of acute radiation sickness at the time of the explosion in Chernobyl, but most of the other health consequences were because of other factors. About 30,000 people were moved out of Pripyat, which is the town near Chernobyl. They were moved to other parts of Ukraine, without jobs and communities. A lot of them became alcoholic and depressed, and they died of alcoholism rather than the impacts of Chernobyl.

There have been a lot of scary stories about nuclear, but it is one of the safest forms of power. I will quote some figures—these are measured by deaths per terawatt hours, which is a huge amount of energy produced. Taking into account all factors, such as air pollution, deaths in production and so on, coal is 24.6 deaths per terawatt hour, oil is 18.4, biomass is 4.6, gas is 2.8 and nuclear is 0.07, and that includes all the deaths in Fukushima and Chernobyl.

[Mrs Sheryll Murray (in the Chair)]

Order. I remind the hon. Gentleman that we are summing up now.

[Anthony Browne]

I will wind up by saying that nuclear is very safe and we do not need to worry about it. It has been an excellent debate.

Question put and agreed to.

Resolved,

That this House has considered the UK’s Climate Progress: the Committee on Climate Change’s 2021 Progress Report.

Draft Statutory Auditors, Third Country Auditors and International Accounting Standards (Amendment) (EU Exit) Regulations 2019

Sheryll Murray Excerpts

Monday 9th September 2019 General Committees

[Peter Grant]

The hon. Gentleman agrees with some of the points I am making. As he helpfully points out, if Government Members were all that interested in going through the regulations in fine detail, perhaps they should have asked professionals in the various accounting and auditing institutions before the Committee. I have no doubt that Government Members will rise to speak in support of the regulations. When they do so, perhaps they will tell the Committee what could have gone disastrously wrong if they had taken the time to get the policy right on their third attempt, and asked the statutory accounting and audit bodies what the regulations would do.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

Perhaps the hon. Gentleman could help me by telling us, as my hon. Friend the Member for Ochil and South Perthshire asked him to do, which specific parts of the regulations he objects to.

[Peter Grant]

It has already been pointed out. As I said, if there has not been consultation with the bodies whose purpose it is to regulate the profession, why would the Government ask a group of lay people to agree the regulations?

[Mrs Murray]

Will the hon. Gentleman give way?

[Peter Grant]

No, I will not give way again. The hon. Lady will get a chance to speak if she wishes. I would be interested to know why the Government did not have that consultation. Why are they making significant changes to policy during a process that the House agreed could be used to make technical, consequential, minor and non-controversial changes, of which there would need to be millions to get us even vaguely ready for 31 October? Why are they trying to put in much more significant and substantive changes that should have been tested on the Floor of the House before they passed into law?

UK Deep Sea Mining Industry

Sheryll Murray Excerpts

Wednesday 20th February 2019 Westminster Hall

[Mrs Sheryll Murray (South East Cornwall) (Con)]

I beg to move,

That this House has considered the UK deep sea mining industry.

It is a pleasure to serve under your chairmanship, Mr Hosie. I am grateful to the Minister for coming to respond to the debate. Just a little political push from her over the next few weeks might be all that our fledgling deep sea mining industry needs to succeed and to catch up with our international competitors.

The debate is timely and important. This year, we reached a critical point in the development of the UK’s deep sea mining exploration and exploitation capabilities. A small push from the Minister’s Department could mean that the UK leads the world in the environmentally responsible exploitation of vital and valuable seabed minerals. We could secure supplies of the raw materials we need for a host of new technologies, including rechargeable batteries, as well as large tax revenues. On the other hand, neglect or bureaucratic inertia could mean that we squander a once-in-a-generation opportunity and lose out to more agile, forward-thinking countries, such as China and Belgium.

I will briefly outline why Parliament legislated for deep sea mining in 2014, what has changed since, the progress of other nations, the enormous benefit that the industry could bring to the UK and, finally, some things that the Government could do to help it to move forward. Deep sea mining has come a long way since I took the Deep Sea Mining Act 2014 through Parliament. Back then, we were concerned with making our law technically consistent with the United Nations convention on the law of the sea—UNCLOS. Actual exploration of the deep Pacific seabed, let alone exploitation, was uneconomic, yet Parliament recognised, even then, the enormous economic and strategic potential of deep sea minerals, as well as the environmental risks. We recognised that the UK must be at the forefront of setting global standards for operating in these untouched and sensitive marine environments.

In the last five years, technology has moved apace. Every year, seabed minerals, such as cobalt, grow in importance. Demand for seabed minerals, for example, for wind turbines, solar panels and rechargeable batteries, means that the economics of mining have totally changed. The commercial opportunity, and the environmental risks, are there right now. Other countries are well aware of that and have made good progress in building their industrial bases to seize this opportunity. The International Seabed Authority says it wants to complete its regulations on mineral exploitation by 2020, so that we are no longer concerned with the legal technicalities and theoretical licences.

This is happening right now, and the UK is falling behind. China, South Korea, Japan and the European Union all have well-developed deep seabed mining industries. China was just a side player five years ago but has since made great strides. It now sponsors four deep seabed mining contractors and has just applied for its fifth exploitation contract. That is more than any other country. During those same five years, the UK has sacrificed an enviably strong position.

When I took the 2014 Act through Parliament, Lockheed Martin told me that the UK was in a superb position to lead this industry, economically and environmentally, for the following reasons. First, our regulatory and legislative processes are transparent and predictable. That is crucial for industry, because it reduces the regulatory risk and allows it to plan long-term investments. Secondly, we have high environmental standards and diplomatic leadership on maritime issues. Thirdly, we have a leading and central position in the offshore oil, gas and mining industries. Fourthly, we have a world-leading financial services industry. Last but not least, we have an international reputation for innovation and engineering, and a track record of solving complex engineering challenges.

That really matters, because there are strong concerns about the security of our national supplies of cobalt and rare earth minerals. China currently has a stranglehold on the supply of those minerals. The UK is totally dependent on imports for its supply of cobalt. Cobalt is required for rechargeable batteries for electric cars, which we all know will become incredibly important very soon. Both cobalt and rare earth minerals are present in polymetallic nodules. The International Seabed Authority has granted two licences sponsored by the UK, which cover an area of 133,000 sq km—roughly the size of England. The current best estimate is that that area of seabed contains almost 1 billion tonnes of minerals. Nickel and manganese are vital for the so-called decarbonisation agenda—for electric vehicle batteries and wind farms. Unless we secure the supply of those minerals, we will have no hope of meeting the terms of the Paris agreement.

I believe that after just one deep sea mining operation, we would go from being a 100% net importer of cobalt, nickel, manganese and other rare earth minerals to being a net exporter. Deep sea mining would allow the UK to secure its own supply of those important minerals, yet through inaction we are letting China and other countries beat us to it. The frustrating thing is that the UK has incredible, world-class expertise in battery science. Two years ago, this Conservative Government launched the Faraday battery challenge, yet apparently we have not realised that if we want to be world leaders in rechargeable battery technology, we need raw materials such as cobalt. We simply do not have our own supply of the required raw materials in place.

It is important that the UK becomes a leader in this new international industry so we can ensure that high environmental standards are followed. That is especially important since the USA has not ratified UNCLOS and therefore cannot participate. We can lead not just technologically but in ensuring high environmental standards. Other nations might not have the same commitment to the environment as we have. There is a kind of gold rush under way and, just as with other gold rushes, proper environmental scrutiny could easily be neglected.

The International Seabed Authority has issued 26 different permits for mineral prospecting, of which two are British sponsored. The total area of seabed licensed by the ISA is now a massive 1.2 million sq km. The seabed is largely an unknown world, and new species are being discovered that exist nowhere else. It is one of the last untouched ecosystems in the world. It is vital that the UK leads the world in setting standards for exploration and exploitation without ruining yet another ecosystem.

The two UK-sponsored licences were granted to UK Seabed Resources Ltd, a wholly owned subsidiary of Lockheed Martin. Lockheed Martin drew up charts of the Pacific seabed nodules in the 1970s, when exploitation was completely impossible. Those charts, which we might think of as almost literal treasure maps, now form the basis for exploration and eventual exploitation. Needless to say, both those phases require significant investment.

Belgium benefited from EU funding. Unfortunately, the UK chose not to apply for that funding. Until now, Lockheed Martin has self-funded, but in view of the ongoing regulatory uncertainty, it has been obliged to slow its rate of investment.

It is worth noting that the other projects in the Clarion Clipperton belt have received financial investment from their respective Governments, which is a major reason why those projects are well advanced. Exploitation of those licences needs to reach the pre-feasibility stage by 2022. That will require fairly significant funding if we are not to fall behind further. Government funding would be highly desirable so that at least the UK is not disadvantaged compared with competitor nations.

It is also worth noting that the funding will not go to UK Seabed Resources, but to universities and other regional partners, which will conduct research once funded. The total investment for a seabed mining project is very significant, perhaps as much as £3 billion. That is about the same amount as for a similarly sized onshore mine, but the level of technical risk is higher, which is why some element of Government involvement is normally required.

The funding would not be required all at once, but in several smaller chunks. Furthermore, only about £400 million is required to reach the “bankable” feasibility phase. At that point, traditional debt finance becomes readily available. It is an energy security issue and an environmental issue, and it requires large investment.

Deep sea mining also presents a huge commercial and tax revenue opportunity. When David Cameron was Prime Minister, he called it a £40-billion opportunity, which was almost certainly an over-cautious estimate. If we invest in the industry and make it a commercial success, there will be benefits to the Exchequer in the form of tax and royalties. On current estimates, the Treasury will take £5.7 billion in tax plus £360 million in royalties over 25 years. That is about £2.8 billion at net present value, given the Treasury’s 3.5% discount rate. I have tried to show that the new deep sea mining industry in the UK would create huge commercial, environmental and tax revenue benefits for the country.

The Government could do some simple things that would have a huge impact on the prospects of the fledgling industry. I ask the Minister, in general, what steps the Government have taken, or plan to take, to pioneer the new and essential industry. Specifically, how does she plan for us to catch up with competitor nations and get back to where we should be—in front and leading the way in engineering and environmental standards? What assessment have the Government made of the risks of the economic reliance of the UK and our allies on imports of minerals such as cobalt, nickel and manganese? What is our strategy to reduce or mitigate those risks? Does deep sea mining form part of that strategy? It is now more than four years since the 2014 Act received Royal Assent, but we do not have a strategy or regulatory framework.

To turn to academia and business, how can the Government support a research programme? Can we put one together through the industrial strategy challenge fund to make UK academia and small and medium-sized enterprises world leaders in deep sea mining? If so, how? As I have tried to stress, the benefits would be rapid and large, in the form of mineral supply autonomy and environmental leadership.

Can we explore avenues for international co-operation, for example with the USA, which has not signed up to UNCLOS? Other nations look to us to show leadership in the field. As we look outwards, beyond Brexit, I sincerely hope that we will rise to the challenge.

I have tried to show how the world has changed since the Deep Sea Mining Act passed into law. I have explained what an enormous opportunity we have before us. We can ensure our mineral security and our environmental leadership in this new industry, and gain massive benefits for our industry and the Exchequer.

We are falling behind, and for want of a tiny push by the Government we are in danger of squandering a once-in-a-lifetime opportunity. I therefore urge my right hon. Friend the Minister to look for ways to drive this fledgling industry forward. This is a new, challenging task of the kind that the UK is uniquely capable of delivering. Our capable officials need political will, determination and leadership if they are to make progress. I therefore urge the Minister to work across Government to ensure the UK does not miss this generational opportunity to pioneer a new and essential industry, which potentially has huge benefits to the environment, our energy security and the Exchequer.

Oral Answers to Questions

Sheryll Murray Excerpts

Tuesday 20th November 2018 Commons Chamber

[Mrs Sheryll Murray (South East Cornwall) (Con)]

12. What progress he has made on meeting the Government’s ambition to make the UK the best place in the world to start and grow a business.

[Rachel Maclean (Redditch) (Con)]

14. What progress he has made on meeting the Government’s ambition to make the UK the best place in the world to start and grow a business.

[The Secretary of State for Business, Energy and Industrial Strategy (Greg Clark)]

Our business environment is among the best in the world for small businesses. We have 16.3 million people employed in small businesses and the British Business Bank is supporting small businesses with over £5.5 billion of finance—and colleagues on all sides of the House will wish to support small business Saturday on 1 December.

[Mrs Murray]

Earlier this year, Ideal Foods, a small business in my constituency, celebrated a huge milestone when it achieved a turnover of £10 million in just one year. Another business, the Cornish Cheese Company, has just been awarded the super gold award for its Cornish blue cheese. Does my right hon. Friend agree that these are shining examples of the importance of embracing global trade after we leave the European Union?

[Greg Clark]

I do indeed, and I congratulate Ideal Foods and the Cornish Cheese Company. Perhaps I can add one of my own: Cornish Charcuterie, based just outside Bude, is one of my favourites, and I know that it has many satisfied customers across the UK and Europe, and increasingly around the world. This shows that, of all the manifold assets that Cornwall has, its food and indeed its drink are something to boast about.

Oral Answers to Questions

Sheryll Murray Excerpts

Tuesday 13th March 2018 Commons Chamber

[Greg Clark]

I would have thought that the hon. Lady would have informed herself as to the responsibility of Ministers under the Enterprise Act 2002. That Act, which was passed under the previous Labour Government, states that Ministers can intervene only in mergers that raise public interest concerns on the grounds of national security, financial stability or media plurality. She should know that the Government’s corporate governance reforms have ensured that GKN had longer to prepare its defence, preventing the kind of smash and grab raid that Cadbury’s was subjected to under the previous Government, and that provision has been made for legally binding undertakings to be given in takeover bids. Those are intended to be used, and I would be surprised and disappointed if any bidder did not make their intentions clear, extensive and legally binding.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

T2. Can my hon. Friend assure me that protected status for Cornish produce such as the Cornish pasty will not be compromised post-Brexit?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

It is said that I am no stranger to the fish supper, and I also have knowledge of the Cornish pasty and, indeed, Cornish clotted cream. All those products will achieve UK geographical indications and will continue to be protected in the UK after our EU exit. As negotiations are ongoing, I cannot give my hon. Friend a cast-iron assurance right now that UK products will remain protected in the EU after exit, but I can categorically state that that is the Government’s clear objective.

Post Office Closures

Sheryll Murray Excerpts

Tuesday 25th April 2017 Westminster Hall

[Mrs Sheryll Murray (South East Cornwall) (Con)]

Thank you, Sir Edward. It is a pleasure to follow the hon. Member for Ynys Môn (Albert Owen). I want to talk about three post offices in my area, the first of which is in Lostwithiel. The post office closed, but it now half-opens, for two days a week. Sadly that announcement was made on social media for political gain before consultation with the local community, but it was welcome. However, Lostwithiel is due to lose its permanent bank, and it will have a mobile banking service for two sessions a week. There is no bus service. I am pleading for the Minister to do everything she can to ensure that my constituents in that town, which is bereft of vital public services, can have a permanent post office again. It is an ancient stannary town. It has a lot of antiques businesses and privately owned local businesses. They need a permanent post office service that is open for hours that serve everyone in the community, particularly workers.

We have had a bit of a reprieve in Looe, where my late husband was a fisherman. We saw the post office closed in east Looe. Fortunately, just like in Lostwithiel with its two days, a hard-working postmaster from another village has come in and taken over. Working very closely with my local councillors and local council candidates, we have secured a temporary reprieve, but we need a permanent solution. It is a major tourist town. Tourists do not want to come to a town where they cannot even access post office services.

Finally, in Torpoint, which is very close to my home town, we have had the bank close. People have been told that to use banking services they can go to the post office or make a three-hour round trip. Someone has looked on a map and measured the distance and not taken account of the fact that, on the Rame peninsula, it is an hour and a half’s bus ride to access the alternative bank. The post office is already heavily used and people are very worried that it will not be able to cope with the extra pressure. Will the Minister take account of rural post office services in places such as South East Cornwall to ensure that people get the service they want?

Oral Answers to Questions

Sheryll Murray Excerpts

Tuesday 13th December 2016 Commons Chamber

[Margot James]

I welcome the hon. Lady’s commitment to increasing the number of women on boards in Scotland. I will have discussions with my right hon. Friend the Secretary of State for Scotland to ensure that the national target applies equally to Scotland as to elsewhere in the United Kingdom.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

7. What steps his Department is taking to support the self-employed.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Margot James)]

I apologise to the hon. Member for South Down (Ms Ritchie)—I meant Northern Ireland, of course, in my earlier response.

The gov.uk website and the business support helpline provide information on starting and running a business. Growth hubs also provide access to local and national support, and 4.8 million people are now self-employed.

[Mrs Murray]

In South East Cornwall we have some fantastic self-employed people who make a host of excellent food products. Does my hon. Friend agree that there will be opportunities for them to grow their businesses and be released from excessive red tape once we leave the European Union? What advice does she have for them?

[Margot James]

The Government committed in their manifesto to reducing the burden of regulation on business by £10 billion during this Parliament. We will also carefully consider the implications of leaving the European Union for the business impact target, and the opportunities to reduce further the burdens on businesses such as the excellent self-employed food producers in South East Cornwall.