Asked by: Preet Kaur Gill (Labour (Co-op) - Birmingham Edgbaston)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, how many of UKEF’s 17 fossil fuel pipeline projects will reach financial close in the next six months; and where those projects are located.
Answered by Graham Stuart
UK Export Finance (UKEF) is obliged to consider all requests for its support. Those requests can be made, and subsequently withdrawn, at any time.
UKEF is currently considering support for 10 projects involving fossil fuels which may be completed by the end of July 2021. Eight of these are requests for support through UKEF’s Export Development Guarantee (EDG). The EDG provides general working capital to support the operations of eligible exporters, and is not tied to specific contracts.
The two individual projects for which UKEF is considering support are in the following sectors and locations:
Brazil: Oil and gas
Turkmenistan: Compressors for a gas pipeline to a power station
UKEF currently also has 12 applications for trade finance cover in the sector that may be completed by the end of July 2021. These are all related to oil and gas projects, and are located as follows:
Azerbaijan: 2
Belgium: 1
China: 2
Egypt :1
Malaysia: 3
Mozambique: 1
Oman: 1
Qatar: 1
However, the decision whether or not to provide support for any of these projects or applications will also have to take into account the implementation of the new policy announced by the Prime Minister on 12 December. The date of implementation of the new policy will be determined following the consultation that was launched on the same day.
Asked by: Preet Kaur Gill (Labour (Co-op) - Birmingham Edgbaston)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, what type of fossil fuel projects in UKEF’s programme pipeline will reach financial close in the next six months.
Answered by Graham Stuart
UK Export Finance (UKEF) is obliged to consider all requests for its support. Those requests can be made, and subsequently withdrawn, at any time.
UKEF is currently considering support for 10 projects involving fossil fuels which may be completed by the end of July 2021. Eight of these are requests for support through UKEF’s Export Development Guarantee (EDG). The EDG provides general working capital to support the operations of eligible exporters, and is not tied to specific contracts.
The two individual projects for which UKEF is considering support are in the following sectors and locations:
Brazil: Oil and gas
Turkmenistan: Compressors for a gas pipeline to a power station
UKEF currently also has 12 applications for trade finance cover in the sector that may be completed by the end of July 2021. These are all related to oil and gas projects, and are located as follows:
Azerbaijan: 2
Belgium: 1
China: 2
Egypt :1
Malaysia: 3
Mozambique: 1
Oman: 1
Qatar: 1
However, the decision whether or not to provide support for any of these projects or applications will also have to take into account the implementation of the new policy announced by the Prime Minister on 12 December. The date of implementation of the new policy will be determined following the consultation that was launched on the same day.
Asked by: Ian Murray (Labour - Edinburgh South)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many written instructions as described in section 5.5 of the Ministerial Code have been issued by Ministers in each year since 2010; for what reason each instruction was issued; and in which Department they were issued.
Answered by Steve Barclay
Ministerial Directions are published on gov.uk. As set out in paragraph 3.4.5. of “Managing Public Money”,[1] it is the responsibility of the relevant accounting officer to arrange for the existence of the direction to be published, no later than in the next report and accounts, unless the matter must be kept confidential.
There have been 27 Ministerial Directions published since April 2011, set out in the table attached. Prior to this date, publication was not required.
Date | Department | Direction | Reason(s) | Links |
January 2015 | Department for Business, Innovation and Skills | Hatfield Colliery Partnership Ltd | Value for money | |
February 2015 | Department for Transport | Northern and TransPennine Express franchises 2015: invitations to tender | Value for money | |
March 2015 | Department for Transport | Manston Airport: procuring consultants for independent review | Value for Money | |
June 2015 | Department for Business, Innovation and Skills | Royal Mail Employee Shares (1) | Value for money | |
June 2015 | Cabinet Office and Duchy of Lancaster | Kids Company | Value for money | |
June 2015 | Department for Environment, Food and Rural Affairs | Flood reinsurance scheme | Value for money | |
October 2015 | Department for Business, Innovation and Skills | Royal Mail Employee Shares (2) | Value for money | |
October 2015 | Department for Business, Innovation and Skills | Redcar Steelworks | Value for money | |
May 2016 | Department for Transport | London Garden Bridge | Value for money | |
July 2016 | Cabinet Office | Special Advisers’ Pay | Value for money | |
January 2018 | Department for Environment, Food and Rural Affairs | European Union exit costs | Propriety | |
February 2018 | Department for Transport | European Union exit preparations | Propriety | |
March 2018 | Ministry of Housing, Communities and Local Government | Local government overpayment | Propriety | |
March 2018 | Department for Business, Energy & Industrial Strategy | European Union exit preparations – market surveillance | Propriety | |
March 2018 | Department for International Trade | Spend before Royal Assent on EU Exit costs | Propriety | |
May 2018 | Department for Education | T Levels delivery time-table | Feasibility | |
June 2018 | UK Export Finance | Support for export of Typhoon aircraft to Qatar | Value for money | |
April 2019 | UK Export Finance | Increased cover for Iraq | Regularity and value for money | |
May 2019 | Ministry of Justice | Financial assistance for subcontractors affected by the collapse of Working Links | Value for money | |
May 2019 | Ministry of Housing, Communities & Local Government | Remediation of private sector residential buildings with unsafe ACM cladding | Value for money | |
July 2019 | Home Office | Windrush Compensation Scheme | Regularity and Propriety | |
November 2019 | Department for Business, Energy and Industrial Strategy | Continuation of Official Receiver’s Indemnity | Value for money | |
November 2019 | National Health Service | NHS Pension tax charges | Regularity and Priority | |
March 2020 | Department for Business, Energy and Industrial Strategy | (Coronavirus (COVID-19) Support Fund for Retail, hospitality and Leisure Business | Value for Money Feasibility | |
March 2020 | Department for Business, Energy and Industrial Strategy | Coronavirus COVID-19 the Small Grants Fund | Value for Money Feasibility | |
March 2020 | Department for Health and Social Care | Coronavirus (Covid-19): Ministerial direction on spend. | Regularity | |
May 2020 | Ministry of Communities and Local Government | Grant for unsafe cladding | Value for Money |
[1] https://www.gov.uk/government/publications/managing-public-money
Asked by: Lloyd Russell-Moyle (Labour (Co-op) - Brighton, Kemptown)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, how much has UK Export Finance invested in Qatar for the purchasing of military aircraft.
Answered by Graham Stuart
UK Export Finance (UKEF) has no investments in Qatar. In 2018, UKEF provided a package of loans, guarantees and insurance with a value of around £4.2 billion (not taking into account amounts reinsured by other ECAs) in respect of the sale of 24 Typhoon and 9 Hawk aircraft and associated goods and services by UK companies BAE Systems and MBDA UK to the State of Qatar.
UKEF has published details of its support for these contracts in its Annual Report and Accounts 2018-19 (pages 55-56) which has been presented to Parliament and can be found on UKEF’s website.
https://www.gov.uk/government/publications/uk-export-finance-annual-report-and-accounts-2018-to-2019
This package is the only instance of UKEF support for the sale of military aircraft to Qatar.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, what assessment he made of the ability of the Government of Qatar to obtain alternative funding for the import of (a) Typhoon and Hawk aircraft and (b) associated goods and services before providing UK Export Finance support.
Answered by Graham Stuart
UK Export Finance’s (UKEF) mission is to ensure no viable UK export fails for lack of finance or insurance from the private sector, while operating at no net cost to the taxpayer.
It is normal for buyers to look to pay for very large capital expenditures over time in order to spread their costs over a manageable period. UKEF’s support was critical to ensuring the success of the Typhoon contract with the Government of Qatar.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, with reference to the letter sent to him on 20 June 2018 from Louis Taylor, the Chief Executive of UK Export Finance, what assessment he has made of the (a) level, (b) time horizon and (c) political nature of the risks involved in that transaction.
Answered by Graham Stuart
For UK Export Finance (UKEF) to provide financing support for the export of Typhoon and Hawk aircraft and associated goods and services to the Government of Qatar, the Department assessed the impact that the relative quantum of the transaction (around £4.5 billion concentrated in a single market) would have against UKEF’s portfolio and the transaction’s risk horizon of 12.5 years. The Department considered UKEF’s support to be in the national interest in deepening the UK and Qatar’s defence and security relationship. Additionally, the Secretary of State considered the industrial and economic benefits to the UK of the contract, for which UKEF’s support was critical to ensuring its success.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, with reference to the letter of 20 June 2018 from the Chief Executive of UK Export Finance, what the size, time horizon and political nature are of the risks involved in the provision of financing to support the Government of Qatar in the export of Typhoon aircraft and associated equipment and services.
Answered by Graham Stuart
For UK Export Finance (UKEF) to provide financing support for the export of Typhoon and Hawk aircraft and associated goods and services to the Government of Qatar, the Department assessed the impact that the relative quantum of the transaction (around £4.5 billion concentrated in a single market) would have against UKEF’s portfolio and the transaction’s risk horizon of 12.5 years. The Department considered UKEF’s support to be in the national interest in deepening the UK and Qatar’s defence and security relationship. Additionally, the Secretary of State considered the industrial and economic benefits to the UK of the contract, for which UKEF’s support was critical to ensuring its success.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what his Department's assessment was of the UK Export Finance proposal to provide financing support for the export of Typhoon aircraft and associated equipment and services to the Government of Qatar; and if he will place a copy of that assessment in the Library.
Answered by Elizabeth Truss
The Treasury gave consent to UK Export Finance (UKEF) to provide financing support for the export of Typhoon aircraft, associated equipment and services to the Government of Qatar on national interest grounds. The Treasury works closely with UKEF to assess the risks to the Exchequer arising from such support. To ensure effective assessments can be made, detailed commercially sensitive information is required. Were these assessments to be published, it would inhibit UKEF's ability to obtain the information required to consider transactions and would ultimately limit their ability to support UK exporters.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, whether UK Export Finance support for the export of Typhoon and Hawk aircraft to the Government of Qatar will support British small businesses; and whether support through the Direct Lending Facility set aside for SMEs has been used in that transaction.
Answered by Graham Stuart
UK Export Finance’s (UKEF) support for the export of Typhoon and Hawk aircraft to Qatar supports BAES which has a supply chain of 9,000 companies, including small businesses. As the Direct Lending Facility is used to finance the purchase of capital goods and/or services, it is typically used by larger businesses and can also benefit the smaller businesses in their supply chains. UKEF has remaining capacity under its Direct Lending Facility. UKEF looks to where it is needed most and where it can have the greatest beneficial impact for UK exporters and their customers.
Asked by: Barry Gardiner (Labour - Brent West)
Question to the Department for International Trade:
To ask the Secretary of State for International Trade, with reference to his letter of 15 September 2018 to the Chair of the International Trade Committee, what risk assessment the Government carried out on the UK Export Finance support for the export of Typhoon and Hawk aircraft and associated goods and services to the Government of Qatar; and if he will publish that risk assessment.
Answered by Graham Stuart
UK Export Finance (UKEF) has carried out due diligence and robust risk assessment on this transaction, concluding that the overall risk in relation to the transaction was low. This risk assessment is commercially sensitive.
The basis of UKEF’s normal underwriting criteria is a framework agreed with HM Treasury that allows UKEF to provide support where it is needed for UK exporters while managing potential risks to the Exchequer arising from both individual transactions and across its portfolio. Due to the quantum of support (particularly to a single obligor), the long risk horizon and the nature of the transaction, its financing did not fit within UKEF’s normal underwriting criteria. In these circumstances, Ministers can instruct UKEF to support transactions which are judged to be in the national interest.
The UK and Qatar share a close defence and security relationship. The defence contracts with the Government of Qatar were announced alongside a package of training and co-operation between the British and Qatari Air Forces. Both BAES and MBDA UK are significant employers in the UK and this contract will support BAES, its nearly 35,000 employees and the 9,000 companies in its supply chain, many of whom are in highly skilled design and manufacturing roles.
The breakdown of the £4.5bn in financing support to the Government of Qatar is: £3.5bn in loan guarantees and an offer of £1bn in direct loans. In addition to the £4.5bn referred to by the Secretary of State for International Trade in his letter of 15 September to the Chair of the International Trade Committee, UKEF has provided further support for the contract in the form of export insurance bringing the total value to around £5bn in support.