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Tag: Speeches

  • Emma Hardy – 2022 Speech on BBC Local Radio Proposed Reduction in Provision

    Emma Hardy – 2022 Speech on BBC Local Radio Proposed Reduction in Provision

    The speech made by Emma Hardy, the Labour MP for Kingston upon Hull West and Hessle, in the House of Commons on 1 November 2022.

    Thank you for granting the urgent question, Mr Speaker. Let me also welcome the Minister to her place and many of the comments she has made today. BBC local radio stations are vital as sources of information and for sharing communal experiences. I recently attended the Radio Humberside “Make a Difference Awards”, which highlighted the work of local people in their communities. In March last year, Chris Burns, the head of audio and digital for BBC England, celebrated these awards saying:

    “The power of radio is huge when it comes to connecting local communities in their hour of need.”

    I agree. Local radio, especially Radio Humberside, brings a feeling of belonging and companionship, especially to those who are isolated from everyday interactions. Local radio stations also hold democratically elected local politicians to account, and during the covid lockdowns they provided an invaluable service, enabling and publicising local support initiatives and disseminating up-to-the-minute news.

    Local radio has 5.7 million listeners—more listeners than Radio 1 and Radio 5 Live—and it is the embodiment of public service broadcasting, remaining true to the principles behind the creation of the BBC 100 years ago. The plans announced yesterday for changes to the content of local radio—without any consultation at all of local communities—effectively mean that local radio will cease to exist after 2 pm. At Radio Humberside, 139 redundancies are predicted; as well as the impact on the individuals affected, those redundancies represent a collective loss of local expertise and knowledge and of campaigning community voices.

    Does the Minister agree that local listeners should have been consulted? Does she agree that the loss of provision will be damaging to local communities as they lose an important voice for their experiences and concerns about local services, democracy and accountability? Finally, does she agree that local radio cannot call itself local when it stops being local after 2 pm?

    Julia Lopez

    I thank the hon. Lady for her comments and for highlighting the work done by Radio Humberside, as well as the power of radio to connect us in times of need and to ensure local democratic accountability. The mission and public purposes of the BBC include provision of output and services to the UK’s nations, regions and communities. That provision is a key part of the BBC’s remit and we hold the BBC to account for it via Ofcom; it is also something we will look at very closely in the mid-term review.

    The hon. Lady highlighted the loss of local expertise. BBC local radio stations have traditionally been a fantastic way to develop local talent which has gone on to be incredibly important national talent, so we have concerns about that. She talked about the need for consultation. I would have hoped to have had more chance to examine these proposals before they were released, and I shall be talking to the BBC about that next week. I am grateful to the hon. Lady for raising these issues.

  • Robert Jenrick – 2022 Statement on Manston

    Robert Jenrick – 2022 Statement on Manston

    The statement made by Robert Jenrick, the Home Office Minister, on 1 November 2022.

    Manston Update:

    Thanks to the hard work and professionalism of Home Office and Border Force staff, military personnel and our contractors we have made good progress.

    Numbers of migrants have fallen substantially today and we expect them to do so again tomorrow.

    Unless we receive an unexpectedly high number of migrants in small boats in the coming days, numbers will fall significantly this week.

    It’s imperative that the site returns a sustainable operating model and we are doing everything we can to ensure that happens swiftly.

  • Julia Lopez – 2022 Statement on BBC Local Radio Proposed Reduction in Provision

    Julia Lopez – 2022 Statement on BBC Local Radio Proposed Reduction in Provision

    The statement made by Julia Lopez, the Minister of State at the Department for Digital, Culture, Media and Sport, in the House of Commons on 1 November 2022.

    I thank the hon. Lady for highlighting this news announcement that we learned about yesterday, as it gives the House an opportunity to demonstrate the value we all place on BBC local radio services.

    We are currently celebrating 100 years of BBC radio. With its unique position in the radio market, the BBC has continued to develop and deliver high-quality and engaging audio services to the country and internationally over the years. BBC local radio is one of the BBC’s crown jewels. Developed in the late 1960s and 1970s, the BBC’s 39 local radio services in England still reach 5.7 million listeners each and every week. As hon. Members know, BBC local radio is highly valued outside London, where stations in Derby, Stoke, Humberside, Cornwall, Devon and elsewhere have higher reach or share numbers than the average.

    Changes in patterns of listening mean that the BBC needs to look at its services, and the details about new investment in local investigative reporting are very welcome. But overall we do have concerns about the proposals, which we were not given notice of. I want to take this opportunity to stress that the BBC is rightly operationally and editorially independent from the Government, and that decisions on service delivery are ultimately a matter for it. However, the Government are disappointed that the BBC is reportedly planning to make such extensive cuts to its local radio output. We await to hear more from the BBC about how it expects those changes to impact local communities, including in respect of the provision of local news and media plurality.

    At its best, as was particularly shown during the pandemic, BBC local radio is able to bring communities together and it plays a vital role in reflecting local experiences and delivering local news. For older residents living in rural areas, it can be a particular lifeline. The BBC must make sure it continues to provide distinctive and genuinely local radio services, with content that reflects and represents people and communities from all corners of the UK.

    We recognise that in the current political context the BBC, like other organisations, is facing difficult financial decisions, but we are also concerned that the BBC is making such far-reaching decisions, particularly about its local news provision, without setting out further detail on how it will impact its audiences and the communities it serves. In the context of a £3.8 billion licence fee income, we do not have any details about how much this proposal is likely to save. The BBC board must make sure that the BBC complies with its charter duties. The Government are clear that Ofcom, as the BBC regulator, must make sure that the BBC is robustly held to account in delivering its mission and public purposes.

    We note that as part of this announcement the BBC is also proposing establishing 11 investigative reporting teams across England. That will see the creation of 71 new journalism roles, delivering original stories across TV, radio and online services. As the House will be aware, we are currently undertaking a mid-term charter review, which we have set out and which will evaluate how the BBC and Ofcom assess the market impact and the public value of the BBC in an evolving marketplace and how that relates to the wider UK media ecology, including with regard to commercial radio and local news sectors. Handily, I am scheduled to meet the BBC next week, when I shall see the chairman and director general, and I shall raise with them the concerns that are brought to the Chamber today. We also expect the BBC to brief parliamentarians on its announcements shortly.

  • Nusrat Ghani – 2022 Speech on Bus Manufacture in the UK

    Nusrat Ghani – 2022 Speech on Bus Manufacture in the UK

    The speech made by Nusrat Ghani, the Minister for Science and Investment Security, in the House of Commons on 31 October 2022.

    I congratulate my right hon. Friend the Member for Selby and Ainsty (Nigel Adams) on securing tonight’s important debate and setting out clearly some of the challenges that UK bus manufacturers face. He knows that if I were on the Back Benches, this is exactly the sort of debate that I would have instigated, so I am actually pleased that he has raised this tonight. I give him an absolute assurance that this is not the end of the discussion; now that I am aware of this, it is only the start.

    I share my right hon. Friend’s concerns that the procurement of these Chinese-made buses could adversely impact the UK bus manufacturing network and centre. In particular, I was concerned to hear my right hon. Friend say that some of these procurements that take place with China are not always the cheapest contracts, which is not great when it comes to making sure that we get good value for money. In particular, he mentioned that when councils are writing their specification tenders, UK manufacturers cannot bid as only the cheaper Chinese product fits their specification. I am sure that will be heard loud and clear in my Department and at the Department for Transport, and they will no doubt be writing in response.

    It is true that, since 2019, Chinese companies have been enjoying huge volumes of exports around the world, with 98% of electric buses being found in China. I also share the concerns of my right hon. Friend the Member for Scarborough and Whitby (Sir Robert Goodwill), who chairs the bus and coach industry all-party parliamentary group, that we can allow one country to monopolise the market and that we should be doing everything we can to make sure that our supply chains are as clean and as transparent as they can be.

    I will try my best to respond to all the points raised, but I will just run through what we are doing within the sector to help bus manufacturers. As my right hon. Friend mentioned, this sector is incredibly important for the Government’s green growth, making sure that we are levelling up across our country and driving emissions to net zero by 2050. In a previous life, I was the bus Minister, making sure that we were indeed supporting zero-emission buses.

    My right hon. Friend mentioned how important the sector is to jobs. The sector employs 155,000 people—6.1% of total UK manufacturing employment—and a further 347 jobs are estimated to be supported by the industry in the wider economy. Within the framework, UK bus manufacturers are uniquely positioned, employing more than 3,000 people across England, Scotland and Northern Ireland. This is a sector that we need to protect.

    My right hon. Friend the Member for Selby and Ainsty mentioned the prominent British companies, Alexander Dennis, Switch Mobility and Wrightbus, which employ more than 3,500 workers directly and 10,000 indirectly. These manufacturers also have the aptitude and capacity for completing the transition to fully electric bus fleets in the UK by the year 2030 without the need to import buses—that was a very important point to land.

    As I am also joined by the Secretary of State for Northern Ireland, my right hon. Friend the Member for Daventry (Chris Heaton-Harris), it would be remiss of me not to mention his visit to Ballymena factory to pay tribute to the company’s net zero emission products and to affirm the Government’s support for hydrogen. I believe that he also declared the innovative technology fund, which provided £11.2 million for Wrightbus. It is incredibly important that we are doing everything we can to support UK manufacturers.

    Ian Paisley

    It was an honour to be at the Wrightbus plant with the Secretary of State. He was so enthusiastic. I think he actually said that he was really into buses—he is a wee bit nerdy about that. It was brilliant to see a person who really took a specific interest in the manufacturing process and in understanding how important it is in terms of jobs leading through to good green technology. Will the Minister take up the point that I made during the debate, which is about ringfencing the next phase of ZEBRA funding for hydrogen buses? If that happens, British manufacturing will be protected.

    Ms Ghani

    To quickly address the hydrogen point, I am not sure that ringfencing is the appropriate word for me to use at the Dispatch Box, but there is funding available for hydrogen buses; I believe the ZEBRA scheme is helping the West Midlands Combined Authority to deliver 124 hydrogen buses and refuelling infrastructure. As my hon. Friend is raising the profile of the business in his constituency, it is right that we do everything we can to ensure that the money is spent locally within the UK.

    One point my right hon. Friend raised was why councils were shipping buses to the UK when they are not the cheapest option or carbon neutral. As he mentioned, the DFT’s latest ZEBRA scheme has been designed in line with the principles set out in the national bus strategy for England, placing partnership work between local transport authorities and bus operators at the heart of improving bus services.

    That is why the DFT has asked for local transport authorities to submit proposals that have the support of bus operators, to ensure that they work together. Once funding has been awarded to local transport authorities, they will work with bus operators to implement the proposals, but ultimately decisions about the procurement of zero-emission buses will be made locally by local transport authorities or bus operators. DFT is not able to require bidders to design their procurement process in a way that would explicitly favour UK bus manufacturers.

    Nigel Adams

    On the point about not favouring particular manufacturers, is the Minister aware that in March, in its promotional material for announcing the new fund, DFT used a sparkly new electric bus as part of that marketing? The marketing geniuses in the DFT may or may not have been aware that it was a Chinese Yutong bus that was used to promote the scheme, but the idea that we are promoting Chinese buses is slightly alarming—I am turning to the box where the Minister’s officials sit, but I am sure it is not the young lady there who was responsible. Only when UK manufacturers complained was the photograph changed to a British Alexander Dennis bus.

    Ms Ghani

    First of all, it is not a DFT official in the box, but a Department for Business, Energy and Industrial Strategy official. Secondly, as my right hon. Friend knows, I would have kept an eye out to make sure it was not a Chinese bus, but most definitely a UK bus, and I will do so in future.

    The answer I am giving is not exactly what my right hon. Friend wants to hear, but I want to repeat the issue he raised: when the procurements are put together, if they deliberately exclude UK manufacturers, that is something that needs to be looked at. Now that it has been raised in this debate, I will ensure that both BEIS and DFT officials respond in writing to ensure that that point is covered.

    To quickly cover why China has the largest electric vehicle battery industry in the world, because that is important for resilience and ensuring that we support UK manufacturing, we know that China has 98% of the market. We know that we must be resilient, and that is why we have a number of programmes in place, especially the Advanced Propulsion Centre, the Faraday Battery Challenge and Driving the Electric Revolution.

    For example, the Advanced Propulsion Centre provides £11.2 million for the development and manufacture of low-cost hydrogen fuel cell bus technology and the hydrogen centre of excellence with Wrightbus in Ballymena, as mentioned earlier, to further the development of hydrogen technology and drive product sales across the world. We need to be doing more of that kind of work with Members of Parliament, raising the profile of what can be done locally.

    We have talked about the grants available through the Advanced Propulsion Centre, but we also have the ESTHER project, which includes the provision of £9.1 million within the £22 million ESTHER project to develop hydrogen fuel cells—again, that was mentioned earlier. Then there is the consortium led by Intelligent Energy, which includes bus maker Alexander Dennis Ltd. Funding has also been provided to ensure that the ESTHER consortium develops and integrates valuable technology delivery skills, and creates supply chain advantages for the UK, so that it can capitalise on this technology and unlock additional research and development funding from UK suppliers.

    A lot of work has been taking place on localised supply of key components to meet the growing demand for electric vehicles, but we need to make sure that local companies have the opportunity to bid for tenders. I should mention the net zero strategy produced in October 2021, and the Government’s promise of £350 million over the next three years to deliver the automotive transformation fund.

    I keep talking about the funding available, but that may not exactly address the points that my right hon. Friend the Member for Selby and Ainsty raised. To conclude, the issue has been brought to our attention, and I will do my very best to ensure that DFT and BEIS respond fully. My right hon. Friend is aware that if I were on the Back Benches, I most definitely would have raised this issue, even if—especially if—he was on the Front Bench; I would have given him quite a tough time.

    I assure hon. Members that this is not the end but the start of a conversation. We need far more transparency, especially regarding those councils that seem to be giving the majority of their contracts to one particular country or place overseas; that is not good news for us here. We recognise the challenges that we face. We need to help our local authorities to procure buses from the UK. Of course, the supply chain for zero-emission buses will always be global, but we want to make sure that UK bus manufacturing remains strong, and this obviously involves the key components. I will end there. I am keen to meet my right hon. Friend as soon as possible to make sure that everything discussed today is put in writing.

  • Nigel Adams – 2022 Speech on Bus Manufacture in the UK

    Nigel Adams – 2022 Speech on Bus Manufacture in the UK

    The speech made by Nigel Adams, the Conservative MP for Selby and Ainsty, in the House of Commons on 31 October 2022.

    I am pleased to have secured this debate on the importance of bus manufacturing, specifically electric bus manufacturing, in the United Kingdom. Electric buses play a vital role in helping us to reach net zero and reduce pollution in our congested cities. It is for that reason that the Government announced a £200 million boost to support the roll-out of zero-emission buses in March 2022—the zero-emission bus regional areas, or ZEBRA, scheme.

    The UK has three main bus manufacturers: Alexander Dennis in Falkirk, Scotland and in Scarborough; Switch Mobility, formerly known as Optare, which is based in Sherburn in Elmet in my constituency; and Wrightbus in Northern Ireland. They have all developed electric buses and have a small number in service across a handful of our cities. The competition comes from China, with Chinese companies manufacturing around 420,000, an estimated 98% of the global electric bus fleet. These have been in service since May 2020.

    Ian Paisley (North Antrim) (DUP)

    The right hon. Gentleman has initiated an important debate this evening. A few years ago, 70% of the buses Wrightbus was making would have been diesel buses, but in the last year and a half, 70% of its production has been electric buses. There is a market out there for these wonderful, low-emission products but they will only be purchased if Transport for London, Leicester Council and other councils are encouraged through an incentivised scheme to buy British. What does he think should be done to encourage them to buy British products?

    Nigel Adams

    I wholeheartedly agree with my hon. Friend. That is the point of this debate. There is incentive. The Government are saying all the right things about wanting to see electric buses on our streets and they have launched this scheme, but the reality, as he will know, is that the organisations and local authorities that are buying the buses are not necessarily buying British. I will move on to the reasons shortly.

    Jim Shannon (Strangford) (DUP)

    Will the right hon. Gentleman give way?

    Nigel Adams

    I give way to the hon. Gentleman in time-honoured fashion.

    Jim Shannon

    I thank the right hon. Gentleman for securing this debate, and I concur with my hon. Friend the Member for North Antrim (Ian Paisley). Wrightbus in Northern Ireland has secured a contract with Translink to supply 100 zero-emission buses. The contract not only secures local jobs but promotes the company. We must invest in local bus-manufacturing companies in Northern Ireland to supply a global market that is crying out for the innovation of this great United Kingdom of Great Britain and Northern Ireland, and particularly of Wrightbus in Ballymena.

    Nigel Adams

    As ever, the hon. Gentleman is spot on.

    To put those 420,000 Chinese electric buses into perspective, the UK currently has about 40,000 locally operated buses and only about 4% of them are electric. China is intent on maintaining world leadership in electric bus manufacturing and has been winning orders for buses funded by British taxpayers via the ZEBRA scheme. A key question for the Minister is whether the scheme is purely aimed at transitioning buses to electric power, or whether it is also intended to support and encourage our domestic manufacturers to fully transition to manufacturing only electric vehicles.

    I am very familiar with the buses manufactured by Switch in the Selby district. The company was formerly known as Optare and is now part of the Indian Hinduja Group. We also have Plaxton in North Yorkshire. It has been part of Alexander Dennis since 2007. My right hon. Friend the Member for Scarborough and Whitby (Sir Robert Goodwill) knows that company all too well, as it manufactures in Scarborough. This is an important part of North Yorkshire’s manufacturing capability.

    Sir Robert Goodwill (Scarborough and Whitby) (Con)

    Does my right hon. Friend agree that it is important that local authorities and passenger transport executives look not only at the bottom line but at the social implications of placing orders outside the United Kingdom, as it could diminish our manufacturing base and mean that, in future, China could have a monopoly of bus supply to the UK?

    Nigel Adams

    My right hon. Friend is right. As we sit here now, China more or less has a monopoly on global bus supply. If we take Wrightbus, Plaxton, Alexander Dennis and Switch into the mix, the industry employs 3,500 individuals directly and an estimated 10,000 indirectly within the supply chain. This is an important sector.

    I have been to the Switch factory in Sherburn in Elmet, which has orders from Transport for London, First Bus, Manchester Airport parking, City of York park-and-ride, Dubai and New Zealand. As I mentioned, Switch is part of the Hinduja Group and has started manufacturing UK-designed buses in India, including double-decker buses for the Indian market.

    Ian Paisley

    Is the right hon. Gentleman amazed that we have companies in the United Kingdom that build buses for Australia, New Zealand, the United States of America, Germany, Hong Kong and countries all over the world, yet a scheme that is designed to help manufacturers is putting money into the pockets of China and not supporting indigenous employment in the United Kingdom? That is just not right, is it?

    Nigel Adams

    Not only does it not smell right; it is absolutely not right that we are not purchasing British-manufactured buses.

    The model for supplying electric buses is very different from the model for supplying the existing fleets of diesel-powered buses, but electric buses are an excellent fit for the needs of a local bus service. Electric buses do not have the same range as diesel buses, but this is not a disadvantage because the distance travelled each day by local buses on a defined route is known precisely and is within the range of an electric bus working from a local depot. However, the cost of an electric bus is higher than that of an equivalent diesel bus and operators are not experienced in running electric bus fleets. For that reason, the industry is moving to a slightly different model, which should be investigated further, where buses are provided via service contracts, which cover the cost of the buses, the operation of the buses and the charging infrastructure. They can also cover, as part of that, battery upgrades and replacement costs. However, electric buses are far more cost-effective, with lower costs per mile once the transition is made and the infrastructure for charging and servicing is in place.

    The key to this is the battery, which is a key component in an electric bus, or any other electric vehicle. For that reason, there is a lot of focus on battery technology, battery capacity and expected battery life. It might be thought that the bigger the battery capacity, the better the range of bus. That is not necessarily the case, but that has not prevented battery capacity from being a key part of the specification, including in some tender documents.

    Therefore, battery capacity has been a factor that is believed to have unduly influenced some purchasing decisions. Buses manufactured in China are typically heavier than UK buses, so they have larger capacity batteries. In the case of Switch, the bus is designed around a lighter framework and less weight. Operating methods have a major impact on the capacity of battery required.

    The ZEBRA scheme is especially important because, in addition to encouraging the take-up of electric buses, it is encouraging the purchase of new buses to replace an ageing fleet. The pandemic has had a profound effect on the number of passengers using local bus services and even now passenger numbers are far lower than they were before the pandemic. During the pandemic, bus services were supported by the Department for Transport. In August 2022, a further £130 million was made available to support bus services, which is a considerable sum. However, bus operators are now experiencing reduced passenger numbers and the inflationary pressures of fuel and wage rises. It is not surprising, therefore, that they are not placing orders for new buses in larger numbers. In North Yorkshire, a large number of bus services are currently not viable because of reduced passenger numbers.

    ZEBRA is a major driver of investment in new buses and a key enabler as a step towards net zero. The £198.3 million of funding announced in March is sufficient to fund 943 new buses. That funding is built on the £71 million announced last year to support up to 335 new zero-emission buses in five areas, as well as hundreds more zero-emission buses that have been funded in London, Scotland, Wales and Northern Ireland.

    I hope that that provides you with an insight, Mr Deputy Speaker. I know that they will be thinking of nothing else in Ribble Valley aside from the electric bus market. I now wish to move on to how the Government’s ZEBRA scheme is working in practice and to look at the recent decision by Nottingham City Council to purchase buses from the Chinese manufacture Yutong.

    Nottingham City Council has received £15 million of Government funding, yet it awarded the first 12 of its single-deck buses to Yutong. Within the tender, it did not ask for range requirements, instead asking for a specific battery capacity; it asked that the capacity exceeded 420 kW, which basically excluded all UK manufacturers. That is like asking someone to provide the size of the fuel tank rather than the range or the miles per gallon of a vehicle.

    UK manufacturers run smaller, more efficient batteries than the Chinese manufacturers, so tend to achieve a similar range with a smaller battery. Nottingham City Council has set a target of becoming a carbon neutral city by 2028, yet it is prepared to ship buses from around the world, rather than buying from carbon neutral UK bus manufacturers. That does not make a lot of sense. It is also believed that the Chinese-made Yutong buses were not the cheapest to tender. I will give some other examples.

    Sir Robert Goodwill

    Will my right hon. Friend also bear in mind that China has not exactly covered itself in glory in relation to human rights and democracy?

    Nigel Adams

    As a former Minister for Asia, I know that too well. I have been at the Dispatch Box, where the Minister for Science and Investment Security, my hon. Friend the Member for Wealden (Ms Ghani), is sat this evening—we all look forward to what she has to say—and she was sat where I am, quite rightly giving me stick up and down dale about human rights abuses in China. I will be interested to hear what she has to say on this particular subject.

    Let me give the House some more examples, including the decision taken by Leicester City Council, where the first ZEBRA buses were delivered—also Chinese. Cardiff Council ordered 36 zero-emission buses from the same Chinese company, and Newport City Council ordered a further 16 Chinese buses. They were all supported by UK Government funding.

    I mentioned light goods vehicles, especially those used for delivery services. Bus manufacturing is a skilled, bespoke process, as operators seek individual design features. Light goods vehicles are manufactured on a production line and use mass manufacturing techniques; these are high-volume processes. Light goods vehicles are ideally suited to be electric vehicles, because they travel regular routes and not especially long distances. They are the next major EV opportunity, and the technology being used in electric bus transmission is directly transferable.

    Ian Paisley

    One of the ways in which the Government could buck the market and protect British manufacturing would be to say that 50% of the next number of ZEBRA buses that are ordered must be hydrogen buses. That would guarantee the location of the market and that buses are built by UK companies; it would force the market to go down that route and not force them only to buy electric buses.

    Nigel Adams

    That would make sense. I would like to think that the purchasing authorities taking such decisions bear those factors in mind. The battery example calls into question whether the process is completely joined up between DFT and the passenger authorities and local councils making the decisions.

    The zero-emission bus market is forecast to see significant growth and provide great export opportunities globally, with compound annual growth rates of more than 25%. The EV bus and light commercial vehicle market is projected to be worth about $50 billion by 2030. There is, however, a high risk that British manufacturers could lose out to international competitors whose Governments have taken bolder steps to support their domestic markets when it comes to growth and export opportunities. Switch, which is based in my constituency, has announced its plans to invest £300 million across the UK and India to develop its range of electric buses and light commercial vehicles, demonstrating its commitment to a shift to zero-emission vehicles.

    The transition from internal combustion engines to battery technology is a major disruption to motor manufacturing, and Chinese companies have responded to that and enjoyed huge volumes of exports around the world. Based on a large Chinese domestic market, with 420,000 electric buses already amounting to 98% of electric buses worldwide, the UK faces a major challenge in gaining market share. However, the products available from UK manufacturers are competitive and ideally suited to the UK market, for which they were originally designed. The products are also suited for export. The double-decker, which I am proud to say was designed in my constituency, is to be built in volume in India to meet that specific market.

    Without nurturing the transition and supporting British companies in the move to electric buses through the support that the Government are providing, we are in danger of losing the ability to compete. The Government have provided funding to enable local bus operators to transition to EVs. We have three fantastic bus manufacturers that can between them deliver the products required, and supply the orders and exports. As I mentioned, the next opportunity is likely to be light vans and delivery vehicles, for which electric vehicle manufacturing expertise will be critical. UK companies are prepared to invest, but they need the Government to back them, rather than to unintentionally support Chinese manufacturing jobs.

  • George Freeman – 2022 Speech on Public Ownership of Energy Companies

    George Freeman – 2022 Speech on Public Ownership of Energy Companies

    The speech made by George Freeman, the Minister of State at the Department for Business, Energy and Industrial Strategy, in Westminster Hall on 31 October 2022.

    It is a great pleasure to serve under your chairmanship, Mrs Murray. May I take this opportunity to say what a pleasure it is to be back on the Front Bench after the turmoil of the last few months?

    Let me first congratulate the hon. Member for Linlithgow and East Falkirk (Martyn Day) on securing the debate, and David and the 100,000 public petitioners who triggered it. As an open democrat, I welcome the fact that the public are able to trigger debates. It is important that we respond, and I am glad that the public will be able to see the response both in real time and recorded. I thank hon. Members for their contributions, and I am grateful to all those who have taken an interest in the topic.

    The petition received over 100,000 signatures and calls on the Government to do two things: to set out a coherent 25-year plan for UK energy security and strategy, and to take back ownership of our strategic energy assets. As the Minister for Science, Technology, Research and Innovation in the Department, I am delighted to be replying on behalf of the Minister for Climate, my right hon. Friend the Member for Beverley and Holderness (Graham Stuart).

    Let me put everyone out of their misery of expectation and anxiety about what I might say. I absolutely agree that we need a 25-year coherent plan for energy, which is why the Government have put just that in place. I also agree that we need to think much more strategically about our energy security resilience and energy economy, but the Government do not agree that nationalisation is the right way to achieve the objectives that many, but not all, of us share. I say that not in the spirit of complacency at all.

    It is fair to say that successive Governments over the last 40-odd years have taken cheap energy rather for granted, and have not foreseen the urgency of decarbonising our energy supply nor the geopolitical perils of being dependent on overseas suppliers, often from hostile or unsavoury regimes.

    Margaret Greenwood rose—

    George Freeman

    I will just finish this list, if I may. I approach this issue with no ideology, either. All parties have had their problems in the past: in the ’60s and ’70s Labour was rather heavily dominated by the union barons, and the nationalised industry did not do nearly enough to promote innovation. I notice no Liberal Democrat Members here; theirs and the Scottish National party’s tribal opposition to nuclear leaves them playing one-club golf. I do not think there are any easy solutions to this issue, but I do not want to dismiss the urgency of the problem.

    Margaret Greenwood

    The Minister is talking about a 25-year strategy. Given that we are facing a climate emergency, could he explain what the thinking was, and presumably still is, on allowing companies to shield 91% of their profits from a windfall tax designed to tax profits? That means that they are able to invest those profits in fossil fuels.

    George Freeman

    I will happily set out the explanation for our position, which I think will deal with that point. If it does not, I am sure that the Climate Minister will want to follow up with the hon. Lady. We profoundly believe that the way to deliver a low carbon, net zero, sustainable, resilient British energy market and supply chain is to harness the market—the enterprise, the investment, the leadership and the management excellence of the free market—but not in an untrammelled way. I will set out in a moment how our approach is not at all about the free market but about harnessing the market with a lot of regulations, shape and structure, harnessing the genius of the market to public ends. That is a fundamental difference.

    Margaret Greenwood

    I thank the Minister for giving way; he is being generous with his time. He talks about harnessing the market, but he is talking about directing that investment at fossil fuels. How does he square that with our need to meet net zero? That does not make sense.

    George Freeman

    I will deal with that point as I come on to explain our position on net zero and the extraordinary success that the market has had, with appropriate regulation.

    Alan Brown rose—

    George Freeman

    I would like to make some progress as I have hardly even got through my first paragraph, but I will give way.

    Alan Brown

    I thank the Minister for giving way again. On energy resilience and his point about harnessing the market, we know that energy resilience requires long-duration storage. That can be provided by pumped-storage hydro, a technology that already exists. SSE has all the permissions in place to build a new pumped-storage hydro scheme at Coire Glas. It will have 1.5 GW output. All the private investment is there—we are talking about harnessing the market, but the private investment is already there. All that is needed is for the Government to negotiate a cap and floor price mechanism for the sale of electricity. Will the Minister commit to having officials speak to SSE and other operators in the pumped-storage hydro market to bring these schemes forward?

    George Freeman

    I did make clear that I am not the Climate Minister, so I am not going to make that commitment on his behalf, but I will make the undertaking that he will follow up that specific point with the hon. Member.

    I will make some progress and summarise, not least for those listening and watching, the background to this debate and where we have been with British energy policy. Almost four decades have passed since the privatisation of the British energy system began—long enough that I forgive all those watching who may have forgotten why the original decision was taken.

    Back in the 1970s, nationalised industries were run by Government, along with many others, and they were in a very bad state, not least the energy industry. These inefficient monopolies were leaking cash, and they needed much more money to upgrade their age-old and similarly leaky infrastructure. Privatisation, beginning in the 1980s, has completely transformed that situation. I am not suggesting that the energy market is functioning perfectly, but it has transformed that situation.

    It is a shame that this debate has had so little balance and so few references to any of the successes of any private industry. Indeed, at times it sounded like a Corbynite litany of anti-capitalist, anti-business complaints. This debate needs some balance. I am not saying that the energy market is perfect, but let us at least acknowledge the extraordinary progress in the last few years.

    Sam Tarry

    Will the Minister give way?

    George Freeman

    No, I am going to make some progress. Since privatisation, the UK’s energy sector has attracted around £20 billion a year of private capital investment into our energy infrastructure. That money would otherwise have had to come from higher taxes or additional borrowing. Those are policies that the Opposition may prefer, but we prefer to secure private capital to secure those public goods.

    The cost of transporting a unit of electricity has fallen by 17% since the 1990s, while investment has increased. Energy efficiency has gone up. Reliability has increased. Customer service has improved—though it is still not perfect. The number of power cuts has almost halved. These are the real lived experiences of people over the last 30 or 40 years of privatisation. Finally, current market arrangements have allowed for massive decarbonisation of our energy system, with dramatic drops in the cost of renewables.

    It is worth making the point that between 1990 and 2019, we grew the UK economy by 76%, and we cut our emissions by over 44%, decarbonising faster than any other G7 country. That is an extraordinary achievement, secured by the private sector working in partnership with Government. There is more. In the last 15 years, not only have we led the way in decarbonisation; we have also led the way in many of the specific areas of clean energy. We have put it at the heart of the UK’s commitment to reduce emissions as we expand our economy.

    Personally, having arrived here following the 2010 election, I would have liked to have seen the coalition and the Lib Dem-run Department of Energy and Climate Change take the opportunity of a “buy one, get five free” nuclear deal and double and modernise our nuclear capacity. The Lib Dems were religious in opposition to anything nuclear—a position seemingly mirrored by the SNP—but they also thought it would take too long to come on stream. I have news for listeners. It would have been on stream now. We would have had a high-quality, green, resilient supply of nuclear energy for one more generation, guaranteeing clean and green resilience, and many jobs in Scotland, and we would have been able to use this period to invest in the range of renewables that hon. Members have hardly mentioned. I will come to those in a minute.

    Nobody can look back and say that this was all easy. A lot of mistakes have been made, but the truth is that our net zero strategy is the most comprehensive of its kind. The British energy security strategy sets out extra ambitions to those we set out in 2010. It is on track to secure 480,000 well-paid jobs by the end of the 2030s, unlocking £100 billion in private investment by 2030 and mobilising £30 billion of Government investment. That is not the free market with no support from Government. It is a massive programme of Government in partnership with the private sector, and that is why we have driven down emissions at the fastest rate in the G7.

    Dr Whitehead

    Does the Minister agree that, as has been suggested in this debate, quite a lot of the investment that has been achieved for future energy—indeed, it is coming in now—is from companies representative of other states in Europe putting forward that investment, so we could say that he would be happy to have publicly owned investment in this country, provided it is not from the UK? Is that the right conclusion to come to?

    George Freeman

    I am not totally sure I understand the question. The point is that we live in a modern global economy. I do not think anyone other than political dinosaurs would think we can ring-fence all investment to only one country. We live in a global economy, and that is all to the good. This country benefits hugely from that investment. A huge risk of the proposed renationalisation is that, internationally, it would destroy investors’ confidence in the UK, and that is something we have to think seriously about. We do not have a right to attract international investment. We need to be competitive, and this debate has lacked that point.

    We are a world leader in offshore wind, with an ambition to deliver up to 50 GW of offshore wind power by 2030, including 5 GW of floating wind. That is something to be proud of. In my part of the world in East Anglia, the southern North sea is rapidly becoming the Saudi Arabia of wind energy. With proper interconnected offshore grid connectors, we will be able to use off-peak energy to generate green hydrogen. That is an exciting development and it has all been provided by the market—not the free and untrammelled market of the profiteering stereotype, but businesses investing in partnership with Government.

    We continue to break records in renewable energy, which has more than quadrupled since 2010, with low-carbon electricity overall now giving us more than 50% of our total generation. It would have been nice to hear Members at least pay tribute to that achievement, rather than attack the profiteering businesses that have been at the frontline of delivering it.

    We have installed 90% of our solar capacity in this country since 2010, which is enough for 3 million homes. That has happened—

    Margaret Greenwood

    Will the Minister give way?

    George Freeman

    No, I am going to make some progress.

    That capacity has happened by harnessing the power of the market. I do not think anyone would suggest we have had an untrammelled free market. I am not here to make that case; others may. It has been a partnership of the private and public sector. That is why the Government continue to believe in properly regulated markets.

    I have written and spoken widely about the opportunity Brexit gives us to set our own regulatory standards—not in a race to the bottom, but in a race to the top—and to set the standards in the smart grid, in digital energy and in new forms of energy. There is a huge opportunity for us to use that freedom to incentivise private capital to invest in the energy system, provide the best outcomes for consumers, and promote market competition as the drivers of efficiency, innovation and value.

    My party believes profoundly that private ownership of energy assets, properly regulated, improves performance and reliability, and offers consumers greater choice and higher standards of products and services. No market is perfect. There are always pay-offs and balances, but it is very difficult to see how nationalisation would work, particularly as it has been set out this afternoon, with no detail, vague assumptions that there will be lots of money, which would come in the end only from taxation or borrowing, and very little understanding of how it would be done. Anyone listening to this debate has not heard a serious proposal for how nationalisation would happen. They have simply heard a ragtag of arguments against the private sector and against business.

    The argument becomes even more important when we look at the global market and the international energy market in which we find ourselves. These days, no energy market exists in isolation. We do not exist in a vacuum. The pandemic and the war in Ukraine have revealed painfully the interdependence of our global energy supplies. We are not in a position where we can unilaterally declare independence from the global markets. Any renationalised energy company would still have to buy its gas on the global market at the same price—there is no way round that. But it does heighten the urgency of reducing our dependency on foreign actors, hostile states and those who might use their energy power to exercise geopolitical influence on us.

    We are absolutely committed, as we have set out, to diversifying our energy supply and resilience. We understand that sky-high global energy prices, caused by Russia’s appalling invasion of Ukraine, are having real consequences for consumer bills across the country, exacerbating the consequences of the pandemic shutdown of the global economy and its refiring up and opening, which has driven inflation into the system. European gas prices soared by more than 200% last year, and coal prices by more than 100%, leading to an inevitable increase in the cost of energy, which drives the cost of living across our economy.

    That is why, through our British energy security strategy, we are absolutely committed to—and are already implementing—support for diverse sources of home-grown energy to provide greater energy security in the longer term. Let me unpack that: we have set out, first, a comprehensive long-term plan, just as today’s motion calls for, to 2050 for our energy system in 2020’s 10-point plan for a green industrial revolution and the energy White Paper. It needed doing and it has been done. Secondly, the British energy security strategy, published in April this year, charts a pathway to reducing our vulnerability to international energy prices by reducing our dependence on imported oil and gas.

    We will achieve our ambitions by accelerating the deployment of wind, solar and new nuclear energy, supercharging our production of low-carbon hydrogen, and within my portfolio supporting next-generation energy sources including fusion and small modular nuclear. We will support North sea oil and gas in the near term for security of supply, and the important work that is being done in Scotland, particularly on the North sea transition, to turn that infrastructure into the infrastructure for clean, green energy.

    Thirdly, we will ensure a more flexible and efficient system for both generators and users, undertaking our comprehensive view of electricity market arrangements to ensure that consumers fully benefit from the next phase of our energy transformation. That is why we have committed to publishing, with Ofgem, a strategic framework this year on how networks will deliver net zero. Fourthly, not only are we thinking about reforming energy supply, but we have an ambitious programme of energy efficiency measures to lower demand, and to bring down bills and emissions.

    Nationalisation, however, will not solve or help to tackle those challenges, for a number of reasons. First, as I have said, nationalised energy companies would still have to buy gas on the international markets. There is no price reduction that comes with being nationalised. Secondly, if a Labour Government, or perhaps more likely a Labour-SNP-Lib Dem coalition, who were committed to renationalisation came into office, their measures would mean that the British taxpayer would have to compensate directors, shareholders and creditors to the tune of tens of billions of pounds—money that would otherwise be spent on schools, hospitals and public services. Thirdly, the sort of nationalisation that has been talked about blithely but not explained would hugely damage our ability to attract the international investment that I have set out, which is key to delivering net zero.

    Dr Whitehead

    The Minister is either not hearing what is being said by the Opposition, or he is going out of his way to put it in an entirely different light. Neither the Scottish nationalists nor the Opposition have said that we want to renationalise the whole energy industry; we have said that different ways of working from the complete market fetishism that has been going on would be much better for attracting investment from the private sector. A reliable partner in Government could, among other things, bring the cost of capital down. That is very different from what he is talking about.

    George Freeman

    It is. It is also different, as the record will show, from what Opposition Members said. For an hour, I listened to a reheated hash of the same old anti-capitalist, anti-business, easy—

    Dr Whitehead

    Did you?

    George Freeman

    Yes, I did, and the record will show it. Those interested in how we might build a modern energy economy will observe that there was very little detail on how nationalisation will be done. Very little was said about innovation, new sectors, or how we create exciting areas of innovation, use the smart grid, create a network of incentives, penalties, rewards and points, and empower consumers. There was none of that. It was a litany of the same old Labour and SNP anti-business, anti-capitalist talk of profiteering companies. Those are, by the way, the same companies that pay dividends into the pension funds of our constituents—and probably the trade union barons who are lobbying for this nationalisation. It is old-fashioned economics that has been proven not to work. I was hoping to come this afternoon and hear—

    Sam Tarry

    Will the Minister give way?

    George Freeman

    No, I have had enough of giving way. All Members are doing is repeating the same points that we have already listened to, and I want to make some progress.

    I will turn to the winter support for energy bills, which is a really important issue and relates to the second half of the petition. We are absolutely committed to reducing the impact on people’s bills of the terrible global events that I have described, including the impact of the war in Ukraine and of the reopening of the global economy after the pandemic. As this Prime Minister and the two previous Prime Ministers have made clear, we are absolutely committed to helping the British public through this, and we are taking action at an unprecedented scale.

    First, our energy price guarantee will save a typical British household about £700 this winter. Secondly, that comes on top of the £37 billion package of support announced earlier this year, which will give all households circa £400 off their energy bills through the energy bills support scheme. That means a typical household saving about £1,100. Thirdly, we are taking further, targeted action to ensure that the most vulnerable can stay warm this winter: the UK’s poorest families will continue to receive £1,200 of support—including £400 from the energy bills support scheme—provided in instalments over the year, with additional support for pensioners and those claiming disability benefits.

    Fourthly, the Government are investing more than £6.6 billion across this Parliament in critical work to improve energy efficiency and decarbonise heating. We will deliver upgrades to more than half a million homes in the coming years through our social housing decarbonisation fund, home upgrade grant schemes and energy company obligation scheme, delivering average bill savings of £300. Fifthly, we have extended the energy company obligation from 2022 to 2026, boosting its value from £640 million to £1 billion a year, helping an extra 450,000 families with green measures such as insulation.

    Sixthly, it is not just households; we are also taking action to support schools, hospitals and businesses. Through the new energy bill relief scheme, the Government will provide a discount on wholesale gas and electricity prices for all non-domestic consumers in Great Britain and Northern Ireland.

    This is not the free-market, laissez-faire, devil-take-the-hindmost economics that has been portrayed this afternoon. This is a Government taking huge and unprecedented steps—on a scale with those we took in the pandemic—to help families, households, businesses and charities to deal with the global cost of living crisis. Again, it would have been nice to hear some reference from Opposition Members to the immensity of that package.

    I come now to energy profits—an issue that Opposition Members raised. We are not just cutting bills in the short term; we are thinking about how we can guarantee an affordable, clean and secure supply of energy for this winter and beyond. We have listened closely to the public debate about the profits enjoyed by energy generators thanks to high international gas prices. We have not just listened; we have acted. That is why in May we introduced a 25% surcharge on extraordinary profits in the oil and gas sector, which will raise about £5 billion over the next year. That revenue will support our support for those hardest hit by the rise in the cost of living and cost of energy.

    We have brought forward primary legislation to give us powers to deliver a temporary revenue limit for renewable generation in the wholesale market. The details of that proposal will be set out in subsequent secondary legislation, and we are committed to collaborating closely with industry to develop it further. This will return a substantial amount of excess profits—profits made through the price surge—to consumers via suppliers.

    Alan Brown

    To get some sort of level playing field, why is there not a renewable energy investment allowance that allows tax write-offs for greater investment in renewable energy, when there is one for oil and gas. It just makes no sense if the Minister is talking about having a cleaner, greener system going forward.

    George Freeman

    I refer the hon. Gentleman to the facts as I have set them out. We are attracting billions of pounds of investment into clean energy—into a whole raft of new renewables. I do not think anyone would argue that the UK is struggling to attract international investment. What we need to do, which I completely accept, is not just to accelerate the deployment of wind and solar, but to continue to invest in the technologies of tomorrow to ensure that we are able to increase global and UK energy supply for a modern society and economy in a way that is clean, green and smart and that develops new jobs.

    I am surprised that Opposition Members are not more excited by the opportunities in this sector for Scotland, which would be recklessly undermined by an uncosted, unthought-through plan for both nationalisation and independence, without credibility for how those plans are going to be funded. That is why our energy security strategy sets out a long-term plan for the whole UK that reduces our vulnerability to international energy prices by reducing our dependence on imported oil and gas.

    We know that this is a very difficult time for families and businesses who are struggling, and that this issue is a matter of genuine public concern—as this petition rightly shows. However, I hope that I have reassured the hon. Members who are present in Westminster Hall and the constituents who they nobly represent that we are addressing this issue with the seriousness that it deserves.

  • Alan Whitehead – 2022 Speech on Public Ownership of Energy Companies

    Alan Whitehead – 2022 Speech on Public Ownership of Energy Companies

    The speech made by Alan Whitehead, the Labour MP for Southampton Test, in Westminster Hall on 31 October 2022.

    Thank you, Mrs Murray.

    Before we go any further in this debate, we ought to be clear about what the petition is calling for. I congratulate the petitioners on bringing forward the petition, which has received over 100,000 signatures, 500-plus of which are from my city of Southampton. I congratulate the petitioners on bringing it forward because it really underlines just what a dreadful state we are in at the moment with our energy provision and energy markets. I take the petition to mean that the Government should effectively expropriate all generation, all transmission, all distribution and all retail energy; place it, with compensation, in the public sphere; and then run a fully nationalised energy system, as was the case 30 to 40 years ago, before the privatisation experiment came into being.

    I can see why many people consider that that is the brief solution to the awful mess that we are in the moment. They see that they are paying sky-high energy bills and that, at the same time, a number of energy companies are making sky-high profits not from their ingenuity in suddenly developing new ways of delivering energy, but from doing what they have always done: supply gas to the UK market for the production of power, for which retail customers are paying sky-high prices.

    Those customers scratch their heads about why that has happened: “How is it that we are paying absolutely out-of-the-window high energy prices while companies are making such enormous windfall profits?” They scratch their heads when the Government spend such a long time deciding whether to alleviate some of the problems caused by those sky-high bills by introducing any form of windfall levy on those companies, and when the Government put an enormous loophole in the windfall tax so that the companies get back most of what they would have paid in windfall tax if they are, so they say, in a position to undertake further gas and oil exploration. The grotesque result is that Shell has not—

    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.

  • Matt Hancock – 2022 Statement on Appearing I’m a Celebrity

    Matt Hancock – 2022 Statement on Appearing I’m a Celebrity

    Part of the statement made by Matt Hancock, the Conservative MP for West Suffolk, in The Sun newspaper on 1 November 2022.

    Some may think I’ve lost my marbles or had one too many drinks, swapping the comfortable surroundings of Westminster and West Suffolk for the extreme conditions of the Australian outback, going where there will be few creature comforts, not enough food, and a load of physical tasks involving snakes, spiders and plenty of other creepy-crawlies.

    While there will undoubtedly be those who think I shouldn’t go, I think it’s a great opportunity to talk directly to people who aren’t always interested in politics, even if they care very much about how our country’s run.

    It’s our job as politicians to go to where the people are — not to sit in ivory towers in Westminster.

    There are many ways to do the job of being an MP. Whether I’m in camp for one day or three weeks, there are very few places people will be able to see a politician as they really are.

  • Alan Brown – 2022 Speech on Public Ownership of Energy Companies

    Alan Brown – 2022 Speech on Public Ownership of Energy Companies

    The speech made by Alan Brown, the SNP MP for Kilmarnock and Loudoun, in Westminster Hall on 31 October 2022.

    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.

  • Sam Tarry – 2022 Speech on Public Ownership of Energy Companies

    Sam Tarry – 2022 Speech on Public Ownership of Energy Companies

    The speech made by Sam Tarry, the Labour MP for Ilford South, in the House of Commons on 31 October 2022.

    It is an honour to speak under your chairmanship for the first time, Mrs Murray. This winter, more than three quarters of UK households will face fuel poverty. Many will have to make impossible choices between putting food on the table or keeping the lights on. We are now at the dystopian point where local councils are forced to open warm banks to prevent people from freezing to death in their own beds. Unfortunately, this was the harsh reality for many across the country long before this current crisis. The UK is ranked sixth highest in long-term rates of excess winter mortality out of 30 European countries; that is literally thousands of people dying from fuel poverty because of extreme costs every single winter.

    According to research from National Energy Action, the UK experiences mortality rates of, on average, 32,000 more deaths in each December to March period than across the rest of the year. Of these, 9,700 deaths are directly attributable to the avoidable circumstances of living in a cold home. That is about the same as the number of people who die from breast or prostate cancer each year. How shocking is that? The scale of the surge in fuel bills represents the gravest threat to living standards since the second world war. This winter, as fuel poverty skyrockets and inflation hits a decade-high peak, the impact on families cannot be overstated. Unless dramatic action is taken by the Government, countless people could even die, and that responsibility will lie in the hands of the Government and their friends in the energy lobby.

    Thinking locally, my inbox is full of desperate pleas from my constituents—from carers, pensioners, local businesses and ordinary people who have not the slightest clue how they or their business will survive this winter. Sadly, they feel incredibly let down by the people in this House and this Government. They think that their pleas are not being recognised, heard or even valued.

    Ilford is a proud and diverse working-class community. I have lived and worked there most of my life, and I am proud to still call it home now. It represents the best of our country: its diversity, industry, entrepreneurialism and communal spirit. However, working-class communities like Ilford are suffering—they are being left behind to freeze this winter. The Government tell us that we must all tighten our belts during this crisis and be prepared to make tough decisions and sacrifices. Why do these tough decisions seem to fall on working-class people every single time, when many at the top think that things have never been so good?

    This year, Britain’s oil and gas giants are taking home record profits. Last week, Shell announced profits of £8 billion—double its profits for the same period last year. In August, the big five posted quarterly profits of £50 billion. These energy companies are literally profiteering off the backs of the unimaginable suffering of millions in the UK, paying out huge multibillion-pound dividends and bonuses to their wealthy shareholders. It is an immense cost, and it is hurting people.

    It is not as if those companies are running an exemplary service for which they should be rewarded. While supporters of privatisation may claim that it benefits consumers and lowers prices, the opposite has been true. Even before the current energy crisis, domestic energy bills had increased by 50% since energy was first privatised by Margaret Thatcher. The UK energy industry is now so bloated and out of touch that it is unable to deliver for the citizens of this country. I argue that it has, in fact, stifled innovation and held back the fight against climate change. Because the market is so desperately out of control, the UK has lost a decade of potential progress on decarbonising buildings, and that has made the task of decarbonising before it is too late all the more challenging. It is hardly cost-effective for the taxpayer, either. Since June 2021, this Government have spent more than £2.7 billion to bail out these failing energy companies.

    It is indeed a great energy rip-off. It has sparked palpable public outrage, with people organising on WhatsApp and the internet about not paying their bills in the same way as with the poll tax revolts in the ’80s. People are sick and tired of being taken for mugs by the ultra-rich who are ransacking the economy and making even more money on a daily basis.

    There is clearly an alternative. Private UK energy providers must be replaced by a single publicly owned energy company that is run in a way that involves workers and—more importantly—consumers alike. It is the right thing to do for the families who have been suffering for so long. Bringing those energy companies into public ownership, or, as Labour has proposed, starting a new company that could begin to take control and offer better services for all at cheaper prices, would allow us to put a freeze on any further price increases for the remainder of this Parliament—at least until the end of 2024. There could be cuts to current charges and the company could deliver a moratorium on disconnections.

    Bringing energy companies into public hands would also generate huge revenues for the state. Analysis by the TUC shows that the Government are missing out on between £63 billion and £122 billion of direct income over the next two years because of past decisions to privatise power plants and the resulting lack of UK public ownership of electricity generation.

    Bringing energy companies into public hands would also truly put Britain back at the heart of the battle against climate change—the biggest issue facing humanity. Indeed, the election in Brazil was won partly on that basis. Research by We Own It found that state-owned utilities invest far more in renewables, as they can make use of the state’s ability to plan for the long term and ensure that more ambitious climate targets become a reality.

    UK public energy would accelerate the deployment of new clean power. It could include developing new technologies where the private sector is slow to scale up—priming the pump for the private sector to get with the programme—such as floating offshore wind or zero-carbon hydrogen. It would also deliver thousands of good, green, unionised jobs. Evidence commissioned by GMB suggests that where public bodies invest in renewables directly, orders are far more likely to be placed through UK supply chains, ensuring that we all benefit from the climate transition. Nine out of 10 countries leading the green transition have a state-owned company of some description—why do we always choose, through sheer ideology, to do things differently, when there is something that could work for our country and our people?

    The energy companies have proven, time after time, that they cannot be trusted to keep bills at affordable levels or to keep executive pay under control. Public ownership could generate billions for the Treasury. It could be the linchpin for a genuinely revolutionary green industrial strategy that could deliver jobs and transform communities from the top of Scotland to the bottom of Cornwall. It could protect millions across the country from the very worst whims of disaster capitalists who are looking to make a quick buck out of the suffering of others.

    Some 66% of the public believe that energy should be brought into public hands. I hope that His Majesty’s Government and the Minister will listen and take action. The ability to make a difference on the issue is in their hands, but I suspect that it will be a Labour Government—hopefully soon incoming—who will begin to deliver the change that this country needs.