House of Commons
Prayers
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Oral Answers to Questions
Mike Thornton (Eastleigh) (LD)
1. What steps his Department is taking to tackle rogue landlords.
The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
We are determined to crack down on the small number of rogue landlords who neglect their properties and exploit their tenants. We have provided £6.5 million to local authorities and have recently published a discussion paper on improving property conditions in the private rented sector that focuses on tackling rogue landlords.
Mike Thornton
I am pleased that the Government are taking action on this issue, which affects so many of my Eastleigh constituents. Will the Minister assure me that, as part of the review, he will give adequate consideration to ensuring that rented homes are fitted with life-saving fire and carbon monoxide detectors, particularly as adequate regulations regarding electrical safety in rented houses are sadly lacking?
Kris Hopkins
I can reassure the House that the review will consider both smoke and carbon monoxide alarms. We will also consider whether landlords should be required to carry out regular checks on electrical installations.
Mr Clive Betts (Sheffield South East) (Lab)
One of the other major problems facing private sector tenants is the actions of letting agents. There was widespread support for the Government’s commitment to a redress scheme, and for the promise made on 20 May last year by the then Housing Minister to have one code of practice to underpin it. However, the Government now say that they cannot go ahead with one code of practice and must rely on voluntary codes, with agents being part of various bodies and with a test of reasonableness in other cases. Why are we not going to have one code of practice? Is it because the Government did not take the necessary powers under the legislation to enable them to do so?
Kris Hopkins
First, the redress scheme will return to the House shortly, and I hope that it will gain all-party support, because it is extremely important for tenants and landlords. Secondly, the code of practice is currently out for consultation and, at the end of that process, we will see what conversations there have been about what shape it should take.
Jeremy Corbyn (Islington North) (Lab)
Will the Minister address the serious problem of the exorbitant rents being charged by private sector landlords, particularly in London, and seriously consider introducing a form of regulation so that ordinary people on ordinary incomes are not driven out of the city in which they live?
Kris Hopkins
Rents across the country are at 1.1% at the moment, and in London they have actually fallen, from 1.9% to 1.6% over the last quarter.
Fiona Mactaggart (Slough) (Lab)
The Minister’s remark about 1.1% and 1.9% is confusing. Perhaps he can illuminate for the House what he means. Certainly, the rents that my constituents—a quarter of them live in private rented accommodation, which very often is substandard—are being charged are rocketing as people move from London to Slough, so how much have rents gone up in areas, such as Slough, around the outside of London?
Kris Hopkins
Quite often the media headlines on rent prices are the advertised rate. The figures I quoted are from the Office for National Statistics, and they are the actual figures tenants are charged after taking up a residency, so they are actually the true figures, rather than those advertised in the media.
Jack Lopresti (Filton and Bradley Stoke) (Con)
2. What progress he has made on improving the planning protection afforded to valued and profitable pubs.
The Parliamentary Under-Secretary of State for Communities and Local Government (Stephen Williams)
We have made it clear through the national planning policy framework that local planning policies and decisions should guard against the unnecessary loss of valued community facilities, such as pubs.
Jack Lopresti
I thank my hon. Friend for that answer. Does he agree that designating a local pub as a community asset is an important way of protecting it against being sold off?
Stephen Williams
Yes, I do. I strongly encourage all hon. Members across the House to engage with their local communities, and perhaps with the Campaign for Real Ale, to see what pubs need protection and to get that protection in place before there is a danger of them being sold off.
Mr Andy Slaughter (Hammersmith) (Lab)
My local borough has lost 15% of its traditional pubs over the past five years, so what is the Minister actually doing about this, or does he agree with his Conservative colleagues that the loss of pubs to luxury apartments and Tesco Metro stores is just the market at work?
Stephen Williams
I have not heard any Liberal Democrat or Conservative coalition colleagues say that they think that the loss of community pubs is a good thing. In fact, I have heard them say exactly the opposite. That is why we put those provisions in place under the Localism Act 2011, and we all strongly encourage our constituents to take them up. I am pleased that today a new community rights alliance has been set up, comprising CAMRA, Supporters Direct, the Theatres Trust and a variety of civic organisations, precisely to encourage communities to take up those rights and safeguard the assets that are important to them.
George Hollingbery (Meon Valley) (Con)
18. Given the Minister’s thoughts about the community right to bid, will he congratulate Rob Stark and his team at the Fox and Hounds pub in Denmead in my constituency? They took on a local developer, bought out the site, raised £200,000 from local people and now own the pub.
Stephen Williams
I am pleased to join my hon. Friend in congratulating those who now own the pub in Denmead in his constituency of Meon Valley. Not only did they use the community right to bid to protect the pub; they also used a community share issue, another initiative being encouraged by the Government. In that way, communities can not only protect their assets but have a means of raising the funds to give practical application to that right.
Kerry McCarthy (Bristol East) (Lab)
I am glad that MPs from the Bristol area are taking such an interest in the future of pubs and the impact of their closure; I do not need to tell the Minister about the effect of the many pub closures across Bristol. What effect does he think the changes to permitted development rights will have on pubs in his area and mine?
Stephen Williams
At the moment, councils can use an article 4 direction to suspend the permitted development rights within the broad A class; perhaps the hon. Lady and I could encourage the mayor and planning committee of Bristol to have a look at that and also consider the issue of betting shops, for example, which we do not want to spread.
Justin Tomlinson (North Swindon) (Con)
3. How much funding his Department is providing to help freeze council tax.
Nick de Bois (Enfield North) (Con)
4. How much funding his Department is providing to help freeze council tax.
Martin Vickers (Cleethorpes) (Con)
13. How much funding his Department is providing to help freeze council tax.
The Secretary of State for Communities and Local Government (Mr Eric Pickles)
More than £800 million of funding is available for a council tax freeze in the next two years; the total amount of funding throughout this Parliament is up to £5.2 billion. That is worth £1,100 for the average household band D property and represents a cut in council tax of 10% in real terms.
Justin Tomlinson
Will the Secretary of State join me in welcoming Conservative-controlled Swindon borough council’s decision to freeze council tax for the fourth year in a row? That contrasts starkly with when Labour controlled the council under a Labour Government, when council tax went up by 42% in just three years.
Mr Pickles
Of course the council should be congratulated on its magnificent achievement; no doubt my hon. Friend’s constituents are very pleased. His council joins the seven out of 10 Conservative councils that have frozen council tax compared with only half of Labour councils. Furthermore, two thirds of Conservative police and crime commissioners froze their council tax, but no Labour commissioners have done so.
Nick de Bois
Is the Secretary of State surprised, like me, that despite the extra funding Enfield council insists that it has to make cuts to council tax support for the most deprived? It finds enough money to send highly paid directors and Labour councillors off to France to property conferences.
Mr Pickles
That would not be the property conference in Cannes, by any chance? No doubt that is very enjoyable. It strikes me that my hon. Friend’s council has its priorities all wrong. It should not be attacking the vulnerable, but making sensible savings and protecting the most vulnerable.
Martin Vickers
Two councils serve my constituency. Conservative-controlled North Lincolnshire council is attracting investment, opening new libraries and freezing council tax, whereas neighbouring Labour-controlled North East Lincolnshire council is closing libraries, spending millions on a new swimming pool when the old one could be refurbished and is unable to resist over-development, particularly in the Humberston and New Waltham areas, because its local plan is out of date. On top of that, it is increasing council tax. I urge my right hon. Friend to maintain pressure on all authorities to keep tax down.
Mr Pickles
I certainly join my hon. Friend in urging councils to show restraint in spending. It is ironic to see the contrast between the two authorities—one clearly has the electorate’s wishes on its side, while the other wishes to punish the electorate.
Helen Jones (Warrington North) (Lab)
Why does the Secretary of State keep claiming that he is freezing council tax? His actions actually increased it for 700,000 of the poorest working families in this country because of his changes to council tax benefit. Will he now accept that the 10% cut that he imposed hit councils with the biggest number of claimants hardest and made it much more difficult for them to mitigate the effects of the cuts?
Mr Pickles
We localised council tax support, which had continued to grow under Labour. If the hon. Lady is making a commitment to repay that money and put it back, that is interesting. It was costing taxpayers £4 billion a year. It is important that the most vulnerable are protected and councils have the ability to keep the savings they want and invest them in the community. I urge the hon. Lady to give her own council a talking to and to get it sorted out.
Andy Sawford (Corby) (Lab/Co-op)
The Secretary of State’s answer is not good enough. [Interruption.] Government Members are inviting me to comment on a constituency issue, but I am sure you would want me to be espresso, Mr Speaker. The Secretary of State says there is a freeze, but is it not true that lots of councils, including many Conservative authorities such as that of the Prime Minister, are putting council tax up and that the poorest across the country are getting an increase this year because of the cut to council tax support? When will the Secretary of State admit that it is not a freeze, but a sham?
Mr Pickles
The hon. Gentleman should, to be frank, wake up and smell the Costa coffee. [Interruption.] I am sure I can do better than that, but I am not entirely sure that the hon. Gentleman can. What we have offered to councils is an opportunity to freeze, but if they want to put up their council tax, that is a matter for them. It seems strange that the increases are just below the referendum threshold. Why do they not show the courage of their commitments and go for 5%, 6% or 7%? I am sure that is what would happen if they were given the chance. We only have to look at Labour in Wales to see council tax going up. Let them show some courage and not be democracy dodgers.
Annette Brooke (Mid Dorset and North Poole) (LD)
5. If he will review planning guidance relating to flooding risks.
The Parliamentary Under-Secretary of State for Communities and Local Government (Nick Boles)
We are already looking to see what lessons can be learned from recent floods. There are strict tests to protect people and property from flooding, which all councils should follow, and we will underline the importance of that in new planning guidance to be published shortly.
Annette Brooke
I thank the Minister for his answer. Given our changing weather patterns, what advice would he give to local planning authorities and, indeed, planning inspectors on the allocation of housing sites that are identified as having future flood risk, in terms of green spaces, drainage systems, house design and, indeed, a need to find alternative sites?
Nick Boles
Development in flood risk areas must be flood resistant and resilient. That policy is very clear. I would advise inspectors and councils to follow the Environment Agency’s advice to the letter and make sure that all development is resilient to flood risk.
Mr John Spellar (Warley) (Lab)
Will the Minister tell us whether the Secretary of State now regrets his intemperate attacks last month on the Environment Agency and its staff over flooding?
Nick Boles
The Government are very clearly supportive of Environment Agency staff and the work it has been doing. That is why we have been funding the Environment Agency to continue to do that work and why we are ensuring that all local councils follow its advice on development.
Dr Sarah Wollaston (Totnes) (Con)
At Beesands in my constituency urgent work is needed, not just to repair sea defences, but to enhance them. The rocker arm has been sourced, but the work has been held up because of uncertainty about the need for planning permission. Will the Minister meet me urgently to discuss those uncertainties and the responsibilities for access at neighbouring North Hallsands?
Nick Boles
I am always happy to meet my hon. Friend. Part 12 of the general permitted development order gives permitted development rights on land belonging to or maintained by local authorities, but there are some restrictions with regard to the scale of such development, so the specific case would not matter. Of course, I would be happy to meet my hon. Friend.
Roberta Blackman-Woods (City of Durham) (Lab)
Last year, developers proposed 618 construction projects on land the Environment Agency deemed to be at particularly high risk of flooding. Does the Minister still accept the recommendation from the 2009 practice guide to planning policy statement 25 that, for new developments, the best way of reducing flood risk in the area is to control the water at source through sustainable drainage systems? If so, what is he doing to monitor and encourage the use of SUDs in new developments?
Nick Boles
The hon. Lady is right that SUDs can offer a very effective way of dealing with flood risk. I am sure she will welcome, as I do, the fact that the latest figures show that the estimated number of dwellings built within areas of high flood risk in England is now at its lowest rate since records began in 1989.
Sarah Champion (Rotherham) (Lab)
6. What assessment he has made of the effects of the local government finance settlement on local authority services for families with young children.
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
Every part of the public sector has to do its bit to pay off Labour’s record deficit. We have been clear that councils should make sensible savings, and not take the lazy option of cutting front-line services. That is why we have protected the early intervention grant of £2.5 billion —up £100 million for 2014-15.
Sarah Champion
What does the Minister suggest that I say to my constituents who face an additional monthly bill of £160 for child care, following his local government finance cuts to Rotherham that are forcing Sure Starts to close?
Brandon Lewis
I would say to the hon. Lady that apart from the fact that, at the end of November 2013, there were 3,055 children’s centres and 501 additional sites open to families and children—providing children’s centre services as part of the network—local authorities have a statutory duty to ensure that they have sufficient children’s centres to meet local need. It is quite right that she keeps the pressure on her council to be sensible about the savings it makes, and to make sure that it puts money into the right front-line services, and does not waste it in useless bureaucracy and management.
Andrew Bridgen (North West Leicestershire) (Con)
Given that a quarter of all Government expenditure is delivered via local government, does my hon. Friend agree that it is important—indeed, essential—for local councils to play their part in reducing the huge deficit we inherited from the previous Labour Government?
Brandon Lewis
My hon. Friend makes a very fair point. Councils should look to curtail the £2 billion of fraud and error in the system, and the £2 billion of uncollected council tax, to make sure that they are able to provide the front-line services that residents rightly deserve.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Does the Minister agree that the problem is not only half-empty and understaffed children’s centres, but the fact that children’s services in charge of child protection are not able to fulfil that function fully enough?
Brandon Lewis
Again, I would say to the hon. Gentleman that if the local authority in his area is making bad decisions about where its funding goes, he should put pressure on it, and I am very happy to help him to do so.
Stephen Mosley (City of Chester) (Con)
Cheshire West and Chester’s adoption and fostering services have recently been rated the best in the north-west. The council has achieved that by working and combining resources with two Labour councils, Halton and Knowsley. Does that not show that if councils work together to reduce costs, they can improve services as well?
Brandon Lewis
My hon. Friend gives a very good example not just of cross-party work, but of bringing different agencies and authorities together with the kind of shared, structural approach that delivers a much better service for less. That is exactly what residents want, and it is the right way to spend taxpayers’ money.
Charlie Elphicke (Dover) (Con)
7. What steps he is taking to help local shops and firms with their business rate bills.
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
At the end of last year, the Government announced a £1 billion business rates support package, which includes a £1,000 discount for smaller shops, pubs and restaurants, and a 50% discount for businesses taking on long-term empty shops, and which doubles small business relief for another year, helping just over 500,000 small businesses.
Charlie Elphicke
What help does the Minister think the £1,000 cut in business rates will provide to Deal in my constituency? As he knows, Deal was recently named as having the high street of the year.
Brandon Lewis
My hon. Friend is quite right. I enjoyed visiting Deal recently to see the success that it has made of its high street, with small independent shops working together with the town council and the local authority. The £1,000 discount will be important, particularly to those small independent shops, and it comes on top of the national insurance benefit that they will get from April. That means that they will have a lower cost line and therefore be able to take more income that they can use to reinvest and, I hope, to employ more people, and so see Deal go from strength to strength.
Nic Dakin (Scunthorpe) (Lab)
The reality is that, despite what the Minister says, business rates have risen by £1,500 on average since the last election and are due to rise by a further £270. It is the straw that is breaking the back of many local businesses. When will he really do something about it, instead of just bluster?
Brandon Lewis
I thank the hon. Gentleman for his question, because it allows me just gently to remind him that, under the Labour Government, I do not remember any Opposition Members looking completely to review business rates or to do something about them—unlike this Government, who have just announced a £1 billion package, particularly to help businesses in and around our high streets to go from strength to strength, because we care about our high streets and the communities they serve.
Mr Nick Raynsford (Greenwich and Woolwich) (Lab)
8. What representations he has received in support of the case for making the installation of smoke alarms mandatory in all privately rented accommodation. [R]
The Parliamentary Under-Secretary of State for Communities and Local Government (Stephen Williams)
Representations have been received from a range of organisations, including the Chief Fire Officers Association. We recently published a discussion paper on property conditions in the sector, which invites views on whether smoke alarms should be mandatory in privately rented accommodation. The deadline for comments is 28 March.
Mr Raynsford
I first draw attention to my interest that is declared in the Register of Members’ Financial Interests.
Given the overwhelming evidence that smoke alarms save lives and given that the cost of installing a smoke alarm with a 10-year battery is between only £15 and £20, will the Minister stop hiding behind the regulatory burden excuse that is all over the consultation paper to which he referred and accept that we need the mandatory installation of smoke alarms in private rented housing as soon as possible?
Stephen Williams
I assure the right hon. Gentleman that I am not hiding behind anything. A consultation is happening and the deadline for comments is just 25 days away, so I think that we can wait until then. He is right that there has been a dramatic fall in the number of deaths in the home as a result of fire. It is at its lowest level since records began.
Alistair Burt (North East Bedfordshire) (Con)
On Christmas day in 1984 in my former constituency of Bury North, nine people, including four children, were killed in a house fire on Massey street due to the combination of a lit cigarette, somebody falling asleep, the presence of foam-filled furniture and there being no smoke alarm. Does my hon. Friend agree that, no matter what great advances there have been in fire safety over the years, every time a family go to sleep without a smoke alarm, they are at risk? There is no reason not to pursue having mandatory fire alarms in rented property as soon as possible.
Stephen Williams
I have much sympathy with what my right hon. Friend says. We all have a role to play as parliamentarians. Every six months when the clocks go back or forward, the Department uses that opportunity to remind people to check the smoke alarms that they have in place, and to remind householders and landlords that having a smoke alarm in place is good practice. We are having the consultation and it is possible that we will take further measures, but let us wait another 25 days.
Mr Andrew Love (Edmonton) (Lab/Co-op)
Is not the lesson from all the evidence that is emerging from the private rented sector that we need stronger regulation? What will the Minister do about all the horror stories that are emerging?
Stephen Williams
Where there are horror stories, local authorities have powers to act. They can serve an improvement notice on a landlord. If a landlord does not take action, the local authority can take action itself. The consultation document looks at other measures that might be put in place. For instance, when equipment in a property is found to be defective, perhaps the redress should be a rent refund for the tenant. That would probably concentrate landlords’ minds.
Sir Tony Baldry (Banbury) (Con)
Given that people are four times more likely to die in a fire if there is no smoke alarm installed in their home, have we not got to the situation where, if a private landlord does not install and properly maintain an alarm in the home, they are breaching a common law duty to properly look after their tenants and could be sued for breaching that duty of care?
Stephen Williams
My right hon. Friend is asking me to look back at my notes from more than 20 years ago about the law of tort to see whether that is the case. We are considering whether such powers should be introduced. I understand that smoke alarms are not mandatory in social housing either, so perhaps there are two houses to be put in order, as it were.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
9. What assessment he has made of the effect of spending reductions on the work of fire and rescue services.
Natascha Engel (North East Derbyshire) (Lab)
17. What assessment he has made of the effect of spending reductions on the work of fire and rescue services.
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
Fire and rescue authorities are best placed to assess and manage their services. They do that through integrated risk management planning. Thankfully, fire and rescue authorities now attend 46% fewer incidents than 10 years ago. They are certainly in the position to best allocate their resources according to local risk.
Tom Blenkinsop
The number of fire calls to Cleveland fire brigade has risen by more than 54% in the past year and the number of deliberate fires has increased by almost 60% from 1,390 in 2012-13 to more than 2,200 in 2013-14. Does the Minister agree that the Department’s cuts, with £4 million cut so far and a further £5.96 million to come, to one of the most high-risk fire authorities in England are hindering the brigade’s ability not only to respond, but to prevent fire-related incidents?
Brandon Lewis
I do not agree with that comment at all. Putting aside the fact that fire authorities were protected from cuts in the first couple of years, it is interesting that the hon. Gentleman makes that comment about Cleveland which, despite his claims, has managed to almost double its reserves over the past couple of years. Perhaps it should spend more of that money on front-line services.
Natascha Engel
The unfair local government funding formula means that counties such as Derbyshire are disproportionately affected by the Government’s cuts. Will the Minister look again at funding for rural authorities to ensure that Derbyshire’s excellent fire and rescue service will not be jeopardised, and can continue to save lives?
Brandon Lewis
The settlement this year was fair to rural and urban authorities, and we had a strong debate on that in the House. The Government have put an extra £11.5 million into supporting rural areas. The hon. Lady’s fire authority has managed to increase reserves by £3 million in the last couple of years, so clearly it is finding that it has enough funds.
Mr Stewart Jackson (Peterborough) (Con)
The Minister will know of the disquiet about the decision of Cambridgeshire fire and rescue service to make its chief fire officer redundant and then to reappoint him almost immediately. Will he assure the House that he will issue robust guidelines to ensure that such practices are not repeated?
Brandon Lewis
My hon. Friend makes a fair point. As he knows, I have written to Cambridgeshire fire and rescue service. The road it has gone down is questionable with the level of cost for the chief fire officer, but it must make those decisions locally. The Government have made their position clear, and I will soon respond more widely to the issues as part of our response to the Knight review.
Duncan Hames (Chippenham) (LD)
Two years ago, Wiltshire fire and rescue service was given the opportunity to raise an extra 10p per week per household in the local council tax and it was one of the lowest cost fire services to council tax payers. It is even proposing to merge its back office with that of Dorset fire service, such is its commitment. That being the case, can the Minister find a way to repeat the invitation to Wiltshire fire and rescue service so that it can protect front-line fire and rescue services, which have been hard at work during the recent floods?
Brandon Lewis
The fire authority, with many others, has done great work during the floods both locally and with mutual aid. We should all be grateful to them for that work. In terms of the de minimis, we did that last year. It was not put in place this year, but obviously we review such matters annually.
Lyn Brown (West Ham) (Lab)
Excluding London, the West Midlands, West Yorkshire and Greater Manchester fire and rescue services are experiencing the worst cuts despite having the highest number of incidents. Will the Minister assure me and the House that there will be no impact on response times?
Brandon Lewis
Local decisions on the application of budget usage are made by local fire chiefs. When the hon. Lady looks at those authorities, she should also look at their spending powers. We find that areas with most need have the highest spending power.
Lyn Brown
I note that the Minister did not answer the question. The Chief Fire Officers Association says that the cuts will have a profound impact on operational response. The Minister’s policy encourages a significant increase in the number of retained firefighters. He will know, as will the House, that despite the fact that retained firefighters do an excellent job, they do not sit in a fire station waiting for an emergency call. I will give the Minister another chance to answer and to tell the House what assessment he has made of the impact of his cuts and his policies on response times.
Brandon Lewis
I appreciate the hon. Lady’s comments about the retained fire service. She should be aware that they do a phenomenal service throughout the country. In many areas they are the bulk of the service, and during the recent strikes—I note that she did not ask the Fire Brigades Union not to strike, nor did she condemn it—they were the backbone of keeping this country safe. They have done a super job. We are all in the fortunate position of seeing fire response times reacting; call-outs are falling to their lowest level for 10 years because of the service’s great prevention work. The fire service’s key work is prevention so that it does not need to respond in the first place.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Will the Government consider putting the flood and rescue work of fire crews on a statutory basis, and will he thank them for their excellent work in the recent winter floods? I recall the young man who died of hypothermia in the Hull floods in 2007 because none of the emergency services had the requisite cutting equipment to free him.
Brandon Lewis
The current legislation recognises the fire sector’s response to flood work. The Civil Contingencies Act 2004, the Fire and Rescue Services Act 2004 and the 2012 fire and rescue national framework detail the role and powers of fire and rescue authorities in respect of emergency response and rescue, including flooding. My discussions with fire chiefs have revealed that that is what they are happy with; they like the current situation.
Michael Fabricant (Lichfield) (Con)
10. What guidance he has issued to local authorities on prioritising (a) members of the armed forces and (b) local residents for social housing; and if he will make a statement.
The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
I hope that Members on both sides of the House will support the fact that this Government have published guidance strongly encouraging councils to prioritise members of the armed forces and their families for social housing. In December we issued guidance on ensuring that local homes go to local people.
Michael Fabricant
That guidance seems to show remarkable common sense, but what further steps can my hon. Friend take to ensure that housing associations and local councils that allocate housing publish precisely the criteria on which they do so, because they should be answerable to the electorate?
Kris Hopkins
Our new guidance will ensure that only those who have lived in the area for two years or more, or those from a well-established local association, can put their name down on the housing waiting list. The guidance also encourages councils to be more open and transparent about who is applying and how the housing is being allocated in their local area to strengthen public confidence in the allocation system.
Sir Bob Russell (Colchester) (LD)
Next month marks the 40th anniversary of local government reorganisation, when the word “local” was diluted. Does the Minister agree that localism means local councils making local decisions that should not be subject to diktat from central Government?
Mark Pawsey (Rugby) (Con)
11. What steps he is taking to promote neighbourhood planning.
Andrea Leadsom (South Northamptonshire) (Con)
16. What steps he is taking to promote neighbourhood planning.
The Parliamentary Under-Secretary of State for Communities and Local Government (Nick Boles)
Neighbourhood planning is proving to be one of the Government’s most popular reforms. Nearly 1,000 communities across England are working on neighbourhood plans, and all eight of the plans to go to referendum thus far have commanded popular support.
Mark Pawsey
The pre-submission draft of Coton Park neighbourhood plan in my constituency is now ready for approval. It covers 950 properties. The team of residents who are drawing it up, ably led by Jill Simpson-Vince, are able to be close to the economic factors and have identified a number of key issues in respect of transport and social well-being. Does the Minister agree that Coton Park sets an excellent example of how a well-run neighbourhood plan process can give people a real say in improving their local areas?
Nick Boles
I greatly enjoyed visiting Coton Park with my hon. Friend and meeting Jill Simpson-Vince. It is a textbook case of how a community can come together to improve their lives through neighbourhood planning.
Andrea Leadsom
In 2010, Northamptonshire council leaders rightly decided that the best way to get a local plan in place quickly was to stick with Labour’s west Northamptonshire joint planning unit. Can my hon. Friend confirm that if they should wish to get rid of this undemocratic body once the local plan is completed, I hope in March this year, they need only write to his office requesting that it be disbanded?
Nick Boles
First, I congratulate my hon. Friend’s local authorities on making sure that the best is not the enemy of the good. She is absolutely right that the constituent authorities would need only to write to my right hon. Friend the Secretary of State to ask for the order to be revoked.
Alison Seabeck (Plymouth, Moor View) (Lab)
Will the Minister congratulate residents of Barne Barton in my constituency on the work they are putting in, with the Ministry of Defence, to get the neighbourhood plan together? Locally, the Ministry of Defence is really helpful with very sensitive land issues. However, there is a clear lack of understanding of the statutory remit as regards what is in and what is out in relation to neighbourhood plans. Will he therefore undertake to talk to colleagues in other land-owning Departments, and will he ensure that the Defence Infrastructure Organisation is included, because it clearly has problems with this?
Nick Boles
I thank the hon. Lady and, indeed, the Opposition parties for supporting neighbourhood planning, because it is a really worthwhile endeavour. I am very happy to talk to all Departments and agencies about their responsibility to co-operate with it.
Andrew Gwynne (Denton and Reddish) (Lab)
What happens when a local neighbourhood seeks to protect a statutory designation such as green-belt land against the wishes of a local authority, particularly in metropolitan areas where such land is at a premium?
Nick Boles
The protections for green-belt land in the national planning policy framework are as strong as they have ever been in any planning policy. Green-belt land can be revised to meet other needs only by local authorities through the local plan process, and it can happen only after intense consultation and in exceptional circumstances.
Jason McCartney (Colne Valley) (Con)
22. Kirklees council has restarted its local development framework process, but it does not expect to have a local plan in place until early 2017. Until then, unscrupulous developers are using the void to build on provisional open land. Will the Minister clarify whether the council can do anything to stop those developments, which are against local wishes in many cases?
Nick Boles
First, no development should go ahead unless it can be made acceptable—unless it can be shown to be sustainable according to policies in the national planning policy framework. That gives my hon. Friend’s local authority lots of grounds to check whether a development is acceptable. Secondly, it is not good enough to have a local plan in place in 2017. This is the beginning of 2014, and the local authority should get a move on.
Steve Rotheram (Liverpool, Walton) (Lab)
12. What assessment he has made of the effect of the local government finance settlement on council services in Liverpool.
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
Councils must continue to play their part in tackling Labour’s budget deficit. Liverpool will have a spending power per dwelling of £2,595 per household, some £500 more than the average for England.
Steve Rotheram
So no real assessment, and certainly no cumulative impact assessment. Has the Minister seen today’s Liverpool Echo, which highlights the human cost of the Government’s 52% cut to our city’s budget? With a further £156 million of savings to find, will the Minister say what exactly he believes will be left to cut?
Brandon Lewis
I suggest that the hon. Gentleman goes back to Mayor Anderson in Liverpool and reminds him that he should be using his £136.5 million of reserves properly, and collecting uncollected council tax that currently costs every tax-paying household in Liverpool £500. Perhaps the mayor should also address the fact that he spends a quarter of his net budget on cultural events, including £650 a day on a Labour spin doctor, a £90,000 car, and £2 million on Beatles memorabilia now worth £300,000.
Julie Hilling (Bolton West) (Lab)
14. What assessment he has made of the level of rent arrears in social housing.
The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
The Homes and Communities Agency reported in February that the median level of arrears among larger housing associations in the third quarter of 2013-14 was 3.9%, an improvement on 4.1% in the previous quarter.
Julie Hilling
Nine out of 10 disabled people are cutting back on food or bills to pay the bedroom tax, and many are now falling into rent arrears. If the Minister was in their position, would he fall into debt, or would he cut back on his heating or eating?
Kris Hopkins
There are currently lots of data about arrears, and lots of rhetoric. We have not yet completed a full year, but the Homes and Communities Agency has looked at larger providers, 92% of which say that 95% of the rent they should have collected has been collected.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
23. Two thirds of households in England affected by the bedroom tax have fallen into rent arrears, and Newcastle is having to set aside money to pay for bad debt that should go on building houses. At the same time, many of my most vulnerable constituents live in fear of falling into arrears. Why will the Government not have a heart, see sense, and repeal this terrible tax?
Kris Hopkins
I, too, am concerned about those vulnerable people, so I asked about what was happening in Newcastle. Rough sleeping is down by a third, and homeless acceptances are down 26%. The number of families in bed and breakfasts for longer than six weeks has remained static: latest figures state that there are no people in B and Bs for more than six weeks.
Steve McCabe (Birmingham, Selly Oak) (Lab)
15. What assessment he has made of the frequency of the use of article 4 directions by local authorities to restrict the concentration of houses in multiple occupation in residential areas; and if he will make a statement.
The Parliamentary Under-Secretary of State for Communities and Local Government (Nick Boles)
Local authorities must inform my Department whenever they make an article 4 direction. We are aware of 47 directions issued in relation to houses of multiple occupation.
Steve McCabe
My constituents in Selly Oak ward in Birmingham are plagued by the constant conversion of three and four-bedroom family homes into seven and 10-bedroom houses of multiple occupation, without any regard for the impact on their lives. Does the Minister agree that planning officers in Birmingham have a route to tackle that through article 4 directions, and that they should stop making excuses and get on with it?
Nick Boles
Absolutely. My understanding is that Birmingham city council recently consulted on introducing just such an article 4 direction, and it would certainly seem to be an appropriate circumstance to look at such a thing.
Robert Halfon (Harlow) (Con)
19. What steps he is taking to increase the uptake of right to buy.
The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
I congratulate my hon. Friend on the excellent sales figures in Harlow, which are already four times higher than they were forecast to be for the year. The reinvigorated right to buy scheme has helped more than 16,200 social tenants to become home owners since it was reintroduced or reinvigorated in April 2012. We are legislating for further right to buy discounts and to reduce the qualifying period from five years to three. We are also putting in place a right to buy agent service that will support tenants through the home buying process.
Robert Halfon
Does my hon. Friend agree that an essential component of social justice is to allow lower earners to own their own home? Is he aware that 74 residents in Harlow have supported my online RightToBuyHarlow.com website to get on the housing ladder? Will the Minister outline how he is communicating with tenants to make even more of them aware of the right to buy opportunities?
Kris Hopkins
The Government remain absolutely committed to ensuring that tenants are aware of, and understand, right to buy. We have sent more than 1 million leaflets to social landlords, and our website had 100,000 visitors in the past month alone. We are continuing to campaign with tenants to ensure that they know their rights on how they can secure their own home.
Mr Speaker
Excellent. We got through the lot. I am most grateful to colleagues for their succinctness. [Interruption.] It is well done to the House.
We come to topical questions. I call Mr Dave Watts.
Mr Dave Watts (St Helens North) (Lab)
Can the Minister explain why hard-pressed—
Mr Speaker
Order. The hon. Gentleman is a figure of such distinction that he is ahead of himself. Question No. 1: that is all he has to say at this stage.
Mr Dave Watts (St Helens North) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Communities and Local Government (Mr Eric Pickles)
I am sure the supplementary question will be very good, Mr Speaker.
I would like to update the House on the Government’s ongoing work on flood response and recovery. The Somerset levels continue to face significant flooding, and the threat from extreme high levels of groundwater will remain for some months in parts of the country. However, across the country local recovery efforts are well under way. I can reassure the House that the Government are determined in their efforts to support all those affected to get back on their feet. The Government have today announced a £2 million package to encourage holidaymakers, from home and abroad, to see for themselves that areas affected by flooding are now open for business.
Mr Pickles
We have made a number of changes. First, we have given local authorities the freedom to be able to do that. Under the previous regime they did not have that freedom. Secondly, rather than pretending that food banks do not exist, we have allowed local authorities and various Government agencies to signpost them.
George Hollingbery (Meon Valley) (Con)
T4. We heard how much success there has been in neighbourhood planning across the country, but a great many communities that are a lot smaller than average would love to indulge in some sort of neighbourhood planning. Will the Minister consider introducing neighbourhood planning-lite for such communities?
The Parliamentary Under-Secretary of State for Communities and Local Government (Nick Boles)
We have, I think, now reached the point where there has been enough experience of neighbourhood planning with enough different kinds of communities for us to learn lessons and to ask whether there is not a version of neighbourhood planning that might be more easily accessible and quicker for some communities. We are doing that work, and we are very keen to hear from any hon. Members and communities with their thoughts on how we can achieve that.
Hilary Benn (Leeds Central) (Lab)
The Secretary of State will be aware that the Leeds city region will become a combined authority in April, but at present York cannot formally join because its boundary is not contiguous. On 28 October 2013, I asked the right hon. Gentleman if he would respond to the city region’s proposal to deal with this. He described it as wholly sensible and said:
“I am confident we will have a resolution before Christmas.”—[Official Report, 28 October 2013; Vol. 569, c. 690.]
However, in a written answer last week the Under-Secretary of State for Communities and Local Government, the hon. Member for Great Yarmouth (Brandon Lewis) said that
“we are now considering consulting before the summer on a Legislative Reform Order”.—[Official Report, 24 February 2014; Vol. 576, c. 120W.]
Given the clear assurance that the Secretary of State gave me, will he gently say to his hon. Friend that he should get a move on?
Mr Pickles
I did not specify which Christmas I meant. However, I gave the right hon. Gentleman an undertaking, and it was a proper undertaking. Various legal obstacles were put in our way, but we intend to consult, and, subject to the position being legally satisfactory, there will be a resolution. Given that I gave an undertaking from the Dispatch Box to resolve the matter, I will not lightly do otherwise.
Hilary Benn
I am grateful for that assurance. I hope that the Leeds city region will now see things speeding up.
Let me turn to the profoundly unfair way in which the Secretary of State is treating local government. He tells us—and we heard it a moment ago from the Under-Secretary of State for Communities and Local Government, the hon. Member for Great Yarmouth (Brandon Lewis)—that spending power per household is the proper way in which to compare council funding. Can the Secretary of State confirm that, as a result of the plans that he has set out, within four years local spending power will be higher in Wokingham than it will be in Leeds, Sheffield or Newcastle, although they face much greater pressures? Most people would say that that is unfair and impossible to justify. Why does the Secretary of State think that areas in greater need should receive less?
Mr Pickles
The right hon. Gentleman will recall that it was on the urging of the Labour party that we adopted the spending power regime. He will also recall that we moved from a need element to a consequence element. Those who are prepared to have houses built and to provide additional facilities to improve their tax position will benefit. We have moved from a system of the begging bowl to a system in which consequences follow economic and entrepreneurial activity.
Mark Pawsey (Rugby) (Con)
T5. The Secretary of State will be aware that Rugby borough council is not just freezing council tax but reducing it by 3%, while Warwickshire county council is raising it by 1.9%. However, the county council has chosen now as the time to present proposals for a unitary authority. Given those contrasting approaches to the setting of council tax, can the Secretary of State suggest any reasons why my constituents would consider the unitary proposals to be a good idea?
Mr Pickles
I said before the last general election that any authority official who came to me with a proposal for a reorganisation would be met with a pearl-handled revolver that I kept in my desk. It sounds as though it is time to oil the thing again.
We have no intention of carrying out a reorganisation. Any spending on a reorganisation is a fundamental waste of taxpayers’ money.
Mr Andrew Love (Edmonton) (Lab/Co-op)
T2. When his party was in opposition, the Prime Minister described homelessness and rough sleeping as a disgrace. Last week the Department published figures which showed that since 2010, rough sleeping had increased by 37%. How would the Minister describe that record?
The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)
Rough sleeping in the country overall has increased by 5%, and it has fallen by 3% in London.
Neil Carmichael (Stroud) (Con)
There are neighbourhood plans in Chalford, Dursley, Eastington and nearly a dozen other areas in my constituency. Does the Minister agree that a good neighbourhood plan is an appropriate protector against inappropriate developments?
Nick Boles
My hon. Friend is absolutely right. I look forward to visiting his constituency with him in the near future to see the planning work being done in some of his communities and by his local authority.
Ian Mearns (Gateshead) (Lab)
T3. The Secretary of State recently announced that in response to the recent floods in the south and south-west of England, the Bellwin formula threshold would be ignored, and the Government would pay 100% instead of the normal default of 85%. On 19 February, the Prime Minister announced that people who had been forced out of their homes would be exempt from council tax for the duration. I have a huge amount of sympathy for those people who have been affected by flooding, but, in the interests of fairness, will the Secretary of State confirm that the same proposals will be extended to cover the authorities and households that were affected by flooding in the north of England in 2012?
Mr Pickles
The sums relate to those affected in the north of England and the rest of the country just before Christmas of last year. I concede that we have made a fundamental change to the system. It probably was long overdue. We will be consulting about the long-term. For the sake of clarity, I should say we have not changed the threshold; all we have done is disregarded the amount paid for the education authority and for fire, which means the threshold effectively drops.
Mr Nick Gibb (Bognor Regis and Littlehampton) (Con)
T10. May I again thank the Secretary of State for coming to Pagham last week?On another matter, many park home residents, including many in my constituency, are frequently charged unreasonable management fees by unscrupulous site owners. This Government tightened the legislation to give extra protection to residents so far as pitch fees are concerned, but there is less protection in respect of management fees, which some site owners are now using instead of the pitch fee to extract unreasonable sums of money from their residents. Will my right hon. Friend the Secretary of State look into this issue to see what further protections can be introduced to protect park home residents from predatory site owners?
Kris Hopkins
The Government have introduced a whole range of guidance and rules associated with protecting residents on park home sites, including stopping owners of sites undermining sales on sites, and making sure fees on a site can be introduced only after the exchange of a statutory form; the individual tenant can then seek an arbitrary intervention if they need to. Other steps, such as to do with the rules associated with a particular site, can be taken only after consultation with the tenant. One of our interventions serves as an example: up until now a tenant could not purchase gas bottles from anywhere but on-site; they can now purchase them wherever they want to.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
T6. In Redcar and Cleveland, between 2003 and 2007 the Tory and Liberal Democrat council raised council tax by 25%, and they raised the chief executive’s pay by £60,000 from £83,000 to £143,000 in just four years. Does the Secretary of State support local Tory and Lib Dem councillors doing that?
Mr Pickles
I would take the same position if it were a Labour council: it is a matter of local choice. What we have done is create a situation where those kinds of choices have to be made before the electorate, and the electorate have to come to a view on them. Prior to that, councillors in what would formerly have been described as smoke-filled rooms could decide these things among themselves without any transparency before the electorate. I think the hon. Gentleman should trust the people.
Mr Peter Bone (Wellingborough) (Con)
Adult victims of human trafficking are looked after centrally through an excellent scheme run by the Salvation Army. Unfortunately, child victims of human trafficking are left to local government to look after and are quite often re-trafficked within a week of being rescued. Will the Secretary of State look at the possibility of removing that role from local government and bringing it under a central plan, as we do for adult victims?
Kris Hopkins
I will take on board what my hon. Friend says, but may I just reassure him that this Government have allocated £4.1 million to tackling rogue landlords, and human trafficking is one area in which the authorities are intervening, so work is being done on that?
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
T7. Residents, constituents and firefighters from across Newcastle are writing to me shocked and angered by the proposed closure of Gosforth fire station. Before the Prime Minister was elected to office, he promised that front-line services would not be impacted, but this Government are cutting Tyne and Wear fire authority’s budget by 23% by 2017. How on earth does the Secretary of State believe it can lose a quarter of its funding without that having an impact on front-line services?
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
This body has had a cut of a couple of per cent. in spending power for each of the past couple of years, and has built up its reserves and been able to spend that on extra training facilities when the Government already have a training facility. The hon. Lady should put pressure on that fire chief to make sure he is making his decisions based on local risk. The local risk decision is one that only the local fire service can make.
Philip Davies (Shipley) (Con)
My constituents in Shipley are sick to the back teeth of Labour-run Bradford council imposing decisions on them against their wishes and their interests, particularly in planning. It is perfectly clear that the council cares only about its heartlands in Bradford, rather than Shipley. My neighbour, my hon. Friend the Member for Keighley (Kris Hopkins) is, helpfully, now a Minister in the Department. Not long ago, he said that we should look at having a local authority for just the Keighley and Shipley constituencies, thus taking us out of the Bradford district. I agree with that, and I am sure my constituents do wholeheartedly, so how can we make progress on that, particularly given his elevated position?
Mr Pickles
It looks like I am going to need more than a revolver. We have no plans to break up the Bradford metropolitan authority, and it always struck me that, no matter whether someone was Conservative or Labour, Shipley by and large ran Bradford.
Andrew Gwynne (Denton and Reddish) (Lab)
T9. Given the financial realities faced by local councils, many valued facilities such as libraries, community centres and swimming pools are being closed. The Localism Act 2011 gives an opportunity for groups to register such facilities as community assets, but that often just buys time, with more obstacles being placed in the way. What assurances can the Secretary of State give to streamline the process of community asset transfer, so that these vital community facilities do not close?
Mr Pickles
I had the opportunity of being briefed by the hon. Gentleman on this local issue. When local councils are transferring an asset it is immensely important that they do not see this as primarily a commercial issue and go for the maximum amount. He has within his constituency a way of ensuring that the two swimming pools are kept open and run efficiently, and that the green belt, which he mentioned earlier, is not threatened. That seems to be a very logical thing to do.
Mr Crispin Blunt (Reigate) (Con)
Reigate and Banstead borough council is very close to approving a core strategy, after five years and three iterations, that is, frankly, in violation of the national planning policy guidance on the green belt. Will my right hon. and hon. Friends examine this situation as a matter of urgency?
Nick Boles
I would, of course, be happy to meet my hon. Friend to investigate any concerns he has. It is very important that these plans are produced after full local consultation and where the local council is in the driving seat.
Andy McDonald (Middlesbrough) (Lab)
Does the Minister accept that a basis for funding fire services that does not take into account the specific risks in an area such as Cleveland, which has the highest concentration of COMAH—control of major accident hazards—sites, means that the funding settlement is neither fair nor safe?
Brandon Lewis
No, I would not agree with that. Local risk is something that local fire chiefs will base their budget plans on, and those will be approved by the fire authority. Again, I remind the hon. Gentleman that Cleveland’s fire authority cannot be short of money because it has managed to increase its reserves in the past couple of years.
Duncan Hames (Chippenham) (LD)
Why does the Minister think Wiltshire council is yet to adopt a local development framework for the north of the county? What advice would he give to bring some order to planning and development around Chippenham and Corsham?
Nick Boles
It is probably fair to concede that for a council that has recently become unitary this is an intensely complicated process. Nevertheless, that council knew that it was taking on the responsibility and it now needs to get a move on and complete the plan.
Chris Bryant (Rhondda) (Lab)
The only sport that is equally participated in by girls and boys is swimming. I do not know whether the Secretary of State can swim, but unfortunately many young people in this country still grow up unable to swim, which poses a threat in later life. Can he tell me how many swimming pools in this country have been closed since this Government came to power? If he is not able to give me a precise number now, perhaps he could write to me later.
Mr Pickles
As the hon. Gentleman suggests, I will write to him, if figures are available. Diligent Members of Parliament can certainly take actions to save valuable swimming pools if they get cracking.
Mr Speaker
It has to be said that the hon. Member for Rhondda (Chris Bryant) is hiding his light under a bushel, because I am advised that he is a most accomplished swimmer. As he has chosen not to inform the House of that fact, I am generously doing so on his behalf.
Charlie Elphicke (Dover) (Con)
Residents in the village of Eastry in my constituency are concerned about an unauthorised Travellers’ development that has just appeared. What actions can councils take on the matter, and can their powers be strengthened?
Brandon Lewis
Obviously, the local council should be looking through its local plan, if it has one. The policies were published last August, with a guide to local authorities about their powers. I encourage them to use them, as they are simple and clear for both residents and councillors. I am also happy to meet my hon. Friend if he wishes to have a further conversation on this.
Points of Order
(10 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Barbara Keeley (Worsley and Eccles South) (Lab)
On a point of order, Mr Speaker. Last week we learned that insurance actuaries had been able to obtain 13 years of hospital medical records on every NHS patient in the country. A report on the use of the data said that the 188 million records were at individual episode level, and the hospital data obtained had many identifiers, including diagnosis, age, gender, area where the patient lived, date of admission and discharge. On Thursday, in a debate in Westminster Hall, the public health Minister, who is in her place, said that she wanted to put it on the record that the data released to the insurance actuaries were publicly available, non-identifiable and in aggregate form. The Minister’s comments on the data released are at complete variance with the reported facts, which were also discussed extensively at the Health Committee last week. There is now a further damaging story in the news that that released patient data were made available online. I understand that the Health and Social Care Information Centre has today had to ask a company to take down a tool that used that hospital patient data online.
May I ask you, Mr Speaker, whether the public health Minister has sought your permission to correct the record from Thursday’s debate. Furthermore, has the Health Secretary asked to make a statement about NHS patient data being made available online?
Mr Speaker
Not at the moment. I can say to the hon. Lady that the public health Minister did indicate to me a willingness to respond to her intended point of order. The Minister is in her place, and we should hear from her now.
The Parliamentary Under-Secretary of State for Health (Jane Ellison)
Further to that point of order, Mr Speaker. I thank you for giving me the opportunity to respond directly. In responding to the Westminster Hall debate on Thursday 27 February and in relation to the points made by the hon. Member for Leeds East (Mr Mudie) concerning the release of information to the Institute and Faculty of Actuaries, I did say that the data that were used were
“publicly available, non-identifiable and in aggregate form.”—[Official Report, 27 February 2014; Vol. 576, c. 212WH.]
I was made aware on Friday 28 February that the information I had to hand during the debate did not include the latest clarification received from the Health and Social Care Information Centre. I therefore wrote to the Chair of the debate, my hon. Friend the Member for Southend West (Mr Amess), on Friday to inform him of that. I have today formally written to him and the Members who were present at the debate to correct the statement, and I have copied that to the House of Commons Library.
The correct position was that the faculty requested pseudo-anonymised information and said it would publish it only as anonymous information with all identifiers stripped out. My assertion that the data provided to the faculty were anonymised and publicly available was therefore incorrect, for which I offer my apologies to the House, the shadow Minister, who is in his place, and Members who attended the debate. In handling this request, the NHS information centre did not treat this as a request for sensitive information.
Once again, I thank you, Mr Speaker, for affording me this opportunity and I apologise for the fact that my comments during the debate provided an incorrect impression of the actual events.
Mr Speaker
I am extremely grateful to the Minister for what she said. It does seem to constitute a most full apology to and an explanation for the benefit of the House. We will leave the matter there. [Interruption.] We will not have a “further to” I am afraid. This matter has been fully addressed. If Members have totally unrelated points of order on completely different subjects, we will hear from them—in other words, for the avoidance of doubt, on matters not appertaining to that which has just been said. The hon. Member for Huddersfield (Mr Sheerman) intends to embark on entirely new terrain.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
On a point of order, Mr Speaker. As you know, I have been in this House a reasonable length of time, but something happened to me last Thursday that I do not recall having experienced before. I tabled a question, which in the preliminary agenda was signified as being question No. 7 for the next day. It was a question about my calling for the setting up of a royal commission on the link between climate change and flooding. By the time I got here on Thursday, the full agenda for the day—the Order Paper—had eliminated that question, and transferred it elsewhere. It was clearly a question to a climate change Minister. Why did it disappear and who allowed it to disappear?
Mr Speaker
What I would say to the hon. Gentleman, who has indeed been in the House for a goodly number of years—it will be 35, to be precise, on 4 May this year—is as follows, and I hope that he will take it in the appropriate spirit. It is entirely a matter for Ministers as to whether they make transfers. The transfer that took place, though immensely disagreeable to the hon. Gentleman, was entirely orderly, and I conclude by saying in the friendliest possible way to him that there are Members who do have something about which to complain but are disinclined to do so and there are Members who sometimes have very little about which to complain but make a very considerable meal out of doing so. It is my firm conviction that the hon. Gentleman has precious little about which to complain, and he is doing his best to make a very large mountain out of an extremely small molehill. [Interruption.] The hon. Gentleman is chuntering from a sedentary position about what I did when I was a Back Bencher, but that was then and this is now.
Estimates Day
supplementary estimates 2013-14
Managing Flood Risk
(10 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Miss Anne McIntosh (Thirsk and Malton) (Con)
I welcome this opportunity to open this estimates day debate on managing flood risk. To put today in context, this is the day of the memorial service in honour of Nelson Mandela; it is a week after the visit by the German Chancellor, Angela Merkel, to address both Houses of Parliament; and it is a day on which the future of Crimea and the rest of Ukraine remains very uncertain. In its own way, though, what we meet to discuss today is equally international and portentous in its nature, as we have seen some of the most damaging storms, most likely emanating, we are told, from the Atlantic on the jet steam and causing immense damage in 2013-14.
I am delighted to welcome the Minister to his place. We were most fortunate to enjoy his company on the Select Committee on Environment, Food and Rural Affairs, and indeed that of the shadow Minister, when we adopted this report in July 2013. How prescient that report appears with hindsight. We have had record rainfall over the past two years, which has led to the most extensive flooding, cost the economy millions of pounds, and caused disruption and distress to householders and communities across the UK.
Additional capital funding for flood defences is welcome, since we are told that every £1 spent on flood defences to protect communities spurs growth and delivers economic benefits worth £8. However, we concluded that spending on flood defences has simply not kept pace with increasing risks from more frequent severe weather. The Chancellor of the Exchequer must ensure that investment increases by some £20 million year on year. We need that money over the next 25 years to protect homes and businesses better. Maintenance of these defences and the effective dredging of watercourses must be a priority.
Miss McIntosh
I should like initially to set out our overview before I take interventions.
The Committee welcomes proposals for a new Flood Re insurance scheme, to ensure that everyone is able to get affordable insurance. We are told that the scheme will be funded by a small levy of about £10.50 a year on all household insurance customers. The Committee insisted, during the passage of the Water Bill, that safeguards be introduced to keep the costs down. It would be interesting if the Minister confirmed whether the Prime Minister has asked for the band H and certain other exclusions to be brought into the review of Flood Re, as was reported over the weekend.
The Government is an insurer of last resort. We were told in evidence that, if there were a one-in-250-year event, such as the one that we have just seen, in the first two or three years of Flood Re coming into effect, the Government would take over as insurer of last resort. We were also told that, for the first two or three years of the Flood Re scheme, there simply would not be enough money in the pot to fund such claims against it. The House needs to understand the implications of that eventuality.
Delay by the Government and the insurance industry in agreeing the provision of affordable flood insurance has caused householders unnecessary uncertainty. The opaque cross-subsidy in the current statement of principles must be translated into a more transparent scheme with clear and robust governance arrangements. This debate provides a useful opportunity for the Minister to update the House on progress towards state aid approval in Brussels, because the last we heard was that had not been embarked upon, which seems to be leaving it late in the day. It raises other exclusions in addition to band H, such as why the cut-off year of 2009 was chosen, and why small businesses such as farms remain excluded.
With spending on the maintenance of defences and watercourses apparently at its lowest for many years, short-sighted reductions in revenue funding appear to threaten and undermine the benefits of capital investment in flood defences, but I firmly believe, as the Committee does, that we should not rely completely on Government sources, but should look at partnership approaches such as the Pickering “Slowing the flow” scheme in my constituency as well as measures by insurance companies.
Sir Tony Baldry
That is exactly the point that I wanted to make. We cannot necessarily expect the Environment Agency to fund the totality of flood defences. In Banbury, recently completed flood defences cost £17 million: £9 million came from the Environment Agency, but £8 million came from others, including the district council, Network Rail, Thames Water and local landowners. Many people have a role to play in contributing to making sure that flood defences work, not just the Environment Agency.
Miss McIntosh
My right hon. Friend makes a powerful point. I do not wish to detain the House too long, but I shall come on to look at that. The Government and the Minister have an opportunity to elaborate on this, but the House must be persuaded of the contribution that private bodies can make. The Select Committee has not been persuaded of that. Personally, I think that there are huge opportunities for water companies, but we need to amend the 2014 pricing review to allow that, so it would be useful to have an update. In addition, I should like to know whether the Minister believes that insurance companies will step up to the plate regarding infrastructure spending.
Mr David Davis (Haltemprice and Howden) (Con)
Although I understand entirely the argument about multiple sources of funding for many flood defences, some major defences—most obviously, in my case, and in the case of my hon. Friends the Members for Brigg and Goole (Andrew Percy) and for Beverley and Holderness (Mr Stuart), the Humber defences—are strategic and, by definition, have to be carried out by a major strategic authority. Under those circumstances, the 1:8 rule and the requirement for other funding do not work. Does my hon. Friend the Member for Thirsk and Malton (Miss McIntosh) accept that strategic intervention should take place on a different scale?
Miss McIntosh
My right hon. Friend brings me to the core of my opening remarks.
We could argue the whole afternoon about how much each side has paid in capital funding over the past two strategic reviews. That argument over capital expenditure is worth having, to the extent that that expenditure has increased, but the Committee on Climate Change—I am sure that the shadow Minister, the hon. Member for Brent North (Barry Gardiner) will rehearse this—concluded that we have to spend some £20 million a year extra. The kernel of the argument is how we define revenue and how we define maintenance expenditure. We do not completely understand where the money is being spent.
Miss McIntosh
If I could make a little progress first, I will then take interventions.
There are a number of maintenance activities which the Environment Agency groups into four main areas. The first is operations: inspecting assets, providing utilities, and operating flood barriers and pumping stations. Some of those have passed from internal drainage boards to the Environment Agency, and have not been maintained since 2004-05. It is important to put that on the record.
The second maintenance activity is conveyance. The Committee was shocked to learn that only £30 million is spent each year in the whole of England and Wales on controlling aquatic weed, dredging, clearing screens and removing obstructions from rivers. We will never know whether regular maintenance and dredging on the Somerset levels by the IDBs or the Environment Agency would have prevented the traumatic flooding we have seen since last autumn and right through the winter.
The third activity is maintaining flood defences and structures, including carrying out inspections and minor repairs, managing grass, trees and bushes and controlling the populations of burrowing animals on flood embankments. My argument is that under the previous Government much of the regular maintenance work was simply not done by the Environment Agency because its political masters, the Government, said not to do it because of birds nesting. I argue that IDBs work with nature and dredge only at the right times of year.
The fourth activity is mechanical, electrical, instrumentation, control and automation—MEICA—meaning carrying out minor repairs to, and replacement of, pumps and tidal barriers.
Mr John Redwood (Wokingham) (Con)
Does my hon. Friend agree that many places, including Wokingham, experienced flooding because essential maintenance work on ditches, culverts, drains and small rivers, which are relatively low-budget items, had not been undertaken by the Environment Agency? In the previous year the Environment Agency spent £1.2 billion overall and massively increased its staff, but it did not have a penny to protect the people of Wokingham from the floods that have now hit them. Is it not a question of how we spend the Environment Agency’s budget?
Mr Jim Cunningham (Coventry South) (Lab)
First, is the hon. Lady or her Committee satisfied with the responses of the various agencies in dealing with flooding? Secondly, is she happy with the level of staff employed by the Environment Agency?
Miss McIntosh
I think there is a coherent view across the House this afternoon that when IDBs, district councils and the flood levy from the regional flood committee contribute to the Environment Agency, it is not always clear what work is done. That is something we are here to debate this afternoon.
Mr David Heath (Somerton and Frome) (LD)
The hon. Lady said that we will never know what the result of dredging in Somerset would have been. I suspect that we would still have had flooding, but it would have started later, could have been removed quicker and would have been far less extensive. Does she agree that the initial ask we are making of the Environment Agency and the Government—the 8 km of dredging, which is the most crucial dredge—now needs to be under way? The maintenance dredging every year by local authorities and IDBs should not be confined to that area, but should look at other potential problem areas, such as the Great Bow bridge in Langport, and connecting Monks Leaze Clyse through to the River Sowy and the King’s Sedgemoor drain.
Miss McIntosh
I do not have my hon. Friend’s depth of knowledge, so I shall simply refer to Lord Smith’s evidence to our Committee. Page 16 states:
“Lord Smith stated that asset management spend would equate to £169 million in 2012-13, reducing to £146 million in 2013-14 and £136 million in 2014-15. He noted that there were some ‘pinch points’ in specific places such as on the Parrett and Tone rivers. He further noted that no additional revenue or operating funding was being provided to match the new £120 million capital funding announced in the Autumn Statement.”
I refer to the Committee’s conclusion, which my hon. Friend will be aware of, that there should have been some regular maintenance of the Parrett and the Tone well in advance of the floods last autumn.
Chris Bryant (Rhondda) (Lab)
I cannot speak to the situation in Somerset, but I hope that the hon. Lady would not advocate dredging in every situation. In the early 1990s and early 2000s, the local authority in my constituency sped up water flows higher up the valley, which led to a significant problem further down the valley. Surely we need a whole-valley answer.
Miss McIntosh
The hon. Gentleman will have listened carefully to the four headings that I set out—the different types of maintenance, of which dredging is a small part.
I turn to the flood defence maintenance funding for the coming financial years. It is with some sorrow that I see the reduction in the headline figures for flood defence maintenance, from £172 million in the financial year 2010-11 to £147 million for 2013-14. I hope that in discussing the supplementary budget, the debate will achieve one thing: an increase in maintenance from revenue funding and a more general grasp of the importance of maintenance in all its forms to preventing flooding in future. The Environment Agency’s £147 million maintenance funding for 2013-14 is allocated as follows, in accordance with the four maintenance categories that I rehearsed earlier. I repeat that there is only £30 million this year for clearing watercourses, normally referred to as dredging, which the hon. Member for Rhondda (Chris Bryant) mentioned. For operation there is £44 million, for structures there is £52 million and for mechanical electrical instrumentation control and automation there is £21 million.
The role of the Department for Environment, Food and Rural Affairs in climate change is narrow; it is about adaptation and seeking to increase resilience. However, it would help to allow the conveyance of water, to slow the flow with land management schemes upstream—dredging, desilting and other means—and to stop fast-growing willow coppice from blocking watercourses in order to allow the water to flow away in Somerset, Yorkshire and other areas across the country, to prevent flooding.
My Committee and I absolutely accept that there is no one-stop option that will prevent all forms of flooding; maintenance, as well as land management upstream schemes, has to be considered.
Caroline Lucas (Brighton, Pavilion) (Green)
Does the hon. Lady recognise that there is incoherence at the heart of the Government’s policy on climate change and flooding? The Prime Minister said that money was no object when it came to the relief effort to clear up after floods, but less than two weeks later he was handing huge new subsidies to the fossil fuel industry; when those fossil fuels are burned, extreme weather events, including flooding, are made more likely. Does she agree with the commentator who said today that that is like promising to rebuild Dresden while ordering more bombers to flatten it again?
Miss McIntosh
I am grateful to the hon. Lady for giving me the opportunity to say that I believe that there is an incoherence in policy. We import woodchip at huge expense from the United States and other parts of the country to co-fire coal at Drax power station in Selby; I should be encouraging farmers in north Yorkshire and all around the country to grow fast-growing willow coppice trees to co-fire that power station. There are inconsistencies and incoherence in our renewals policy and we should visit those as part of our flood prevention scheme.
We have seen just about every type of flooding possible since autumn last year—coastal flooding, tidal surges, river flooding and overtopping, surface water flooding and, most recently, groundwater flooding. We know that all this has been the worst flooding incident in this country in 250 years, since 1766. This debate is the opportunity for the Department to share how the Government seek to adapt to more extreme weather events and how we are becoming more resilient and building more appropriately. Given what was asked at Communities and Local Government questions earlier, I am not sure that the House is entirely convinced that we are yet building in the most appropriate places—that is, not in areas that have something to do with flooding in their name or that act as functional floodplains.
Richard Benyon (Newbury) (Con)
In 2007, 55,000 houses were flooded in this country. My understanding is that this winter about 7,000 houses were flooded. That is a personal tragedy for every single one of those 7,000, but I am not sure how my hon. Friend can claim that last winter’s flooding was the worst for 250 years. We had the worst rainfall for 250 years, but in the context of 2007, the flooding was nowhere near that scale.
Miss McIntosh
It was the worst weather event that we have had. My hon. Friend’s intervention raises the very interesting question of why the Bellwin formula was not raised for the roads, bridges and houses that were damaged in 2012-13. He is right about the number of houses flooded. I think that more houses were flooded in the whole of the Yorkshire region in 2012-13 than were flooded in total this year. I supported the bid by North Yorkshire county council to increase the Bellwin limit and I will come on to that in a moment.
My hon. Friend also raises the very interesting question—this supports my argument—of where the funding will come from. I absolutely agree that most of the flood defences held and that many more houses would have flooded than was the case. The House should celebrate that, but where will the money come from to repair those flood defences that held this time but that will have been damaged by the sustained bashing from the storm?
Mr Henry Bellingham (North West Norfolk) (Con)
My hon. Friend will be aware that in Norfolk the vicious tidal surge of 5 and 6 December reached record levels along parts of the coast and in King’s Lynn in particular. Is she aware that the tidal defences held up remarkably well? There have been some breaches, which the Environment Agency repaired very quickly. Does my hon. Friend agree that managed retreat anywhere along the Norfolk coast would not be an acceptable policy under any circumstances?
Miss McIntosh
I will come on to the role that farmers can play. Ever since I was the MEP for the whole of the Essex coast for five years, I have not been a big fan of managed retreat and have never been persuaded that it is a good thing.
We should recognise the money that the Government have very generously provided. I believe it is £2 million for tourism and £10 million for farms, but it would seem that we need an extra £20 million year-on-year increase in flood management capital funding over the next 25 years to keep pace with the increasing flood threat. I look forward to hearing my hon. Friend the Minister’s response as to the Government’s view on why that might not happen.
Another great development would be more flexibility to transfer money between capital maintenance expenditure and activities. I also urge my hon. Friend the Minister to grab this opportunity to review either the Treasury Green Book or the Environment Agency’s point-scoring system. We heard evidence that the cost-benefit ratio for household protection schemes is 5:1, but that for all other assets it is 18:1. This is, therefore, a good opportunity to address that. During Prime Minister’s questions some two or three weeks ago, the Prime Minister said from the Dispatch Box that all flood funding was up for review. Did he mean a review of the scoring system, which is long overdue? Although it was visited in a modest way in 2010, I believe it should be reviewed from top to bottom.
We concluded that the current model for allocating flood defence funding to protecting property is biased towards urban rather than rural areas. In fact, our report argues that the Department for Environment, Food and Rural Affairs has failed to protect rural areas and that there is a risk to food security as more land becomes at risk of flooding.
I attended the National Farmers Union farming conference last week. The NFU states that 58% of the most productive land—that is, grade 1, farmed English land—is within a floodplain. Our report states that 14% of agricultural land in England and Wales is at risk of flooding from rivers and the sea. A drop in our food self-sufficiency raises a long-term question over ongoing food security.
Mr Heath
I am very pleased that the hon. Lady is making a point about the difference between rural and urban areas. There is a further complication when it comes to Somerset, in that people assume that it is a traditional floodplain, but it is not: it is reclaimed, inland sea. It is the great mere of Somerset. Therefore, all of the equations that would work elsewhere do not work when every single drop of water has to be pumped up and over to a river that is higher than the surrounding land.
Miss McIntosh
My hon. Friend makes his local case very powerfully, and I commend him for doing so.
How points are scored needs to be revisited. It is important to give a higher value for the benefits of agricultural land and of the protection of land to secure future food production. The big question is about ensuring that reduced regulation on farmers and landowners can allow them to remove vegetation from river banks. Now that we have had six months of the seven pilot schemes for the vegetation removal process, I would go so far as to urge the Minister to end the pilots and to roll out the process across the country, so allowing farmers to remove vegetation from their river banks.
I want to say a word about the role of internal drainage boards.
Mr Speaker
Order. Just before the hon. Lady moves on to the subject of drainage boards, may I gently say—I am listening to her speech with close attention, as I invariably do—that I am cautiously optimistic that she is approaching her concluding remarks? I say that not because of any lack of attention or interest on my part, but because several other Members wish to contribute to the debate, and I know that she will be as eager as I am to hear their contributions.
Miss McIntosh
Indeed. That is the purpose of the debate, Mr Speaker.
I am vice-president of the Association of Drainage Authorities. The Select Committee concluded that drainage boards are best placed to remove the vegetation and to carry out the maintenance that has been mentioned. Indeed, we are grateful that the Government have looked favourably on this opportunity to allow IDBs to use their local knowledge and resources, and to undertake more of the investment. We believe that there is a lost opportunity in relation to funding from private bodies that DEFRA—
Miss McIntosh
I will stick to Mr Speaker’s strictures about reaching my conclusion sooner rather than later.
There is an opportunity to lever in more than 15% of contributions from other sources. Will the Minister tell us how the Government intend to do that? Do they intend to use common agricultural policy funds to encourage farmers to undertake flood prevention measures by rewarding them through EU agri-environment schemes or by paying proper compensation for flood storage, flood alleviation and other such schemes? Innovative funding should stretch to allowing water companies to invest through the price review, as I have said. I am a big fan of SUDS, and I believe that sustainable drains should be introduced by the autumn at the absolute latest. Most of Sir Michael Pitt’s recommendations have been adopted, but not, I note, those on ending the automatic right to connect and about sustainable drains.
I want to place on the record our commendation of the volunteers, flood wardens, police, fire, ambulance and Environment Agency staff and all those who responded to the floods.
There is scope for the Bellwin formula to be overhauled and reviewed radically. I have mentioned how the Yorkshire and the Humber region, particularly North Yorkshire, has not benefited from the formula. We recommend that the Bellwin scheme be amended to enable local authorities to secure central Government assistance to repair and reinstate roads and other infrastructure damaged by flooding. We also recommend a review of local authorities having to incur costs of at least 0.2% of its annual revenue budget to qualify for Bellwin funding to make it fairer by measuring the impact on the local community. I add that there should be a review of the cap on spending, which I understand hampers the ability of district and county councils to raise any further contributions towards a local levy.
Finally, we were told by the Association of British Insurers that this was a one-in-250-years event. It said that the cost to date has been £426 million, of which £14 million has already been spent. We welcome Flood Re, but there are too many unknowns. We need to know more about the cross-subsidy, what the final figure will be and—I repeat—from which budget the funds will come and what progress has been made on state aid should the Government act as an insurer of last resort for a similar one-in-250-years weather event. It is obviously extremely important that the military played a role in the recovery stage during the recent floods. However, the Government are silent over which budget is covering that military activity. It would be extremely helpful for the House to know that.
Caroline Lucas (Brighton, Pavilion) (Green)
Last month in Brighton and Hove, local emergency services, utilities, the city council and other stakeholders worked together with admirable determination to help the residents who were at significant risk of groundwater and surface water flooding.
It has become clear that the overall pot of money for which local authorities have to bid for flood protection projects is far from adequate. It would help if the process for applying for funds were simplified. I would like to know whether Ministers are considering improvements in that area. This winter’s events have also shown that we need long-term policies and investment to address all types of flooding, including not only coastal and river flooding, but groundwater and surface water flooding.
Despite the limited increase in investment in flood defences, funding from the Department for Environment, Food and Rural Affairs will still be about £1.4 billion behind what the Environment Agency says it will need between 2015 and 2021 just to stop the flood risk getting even worse. It is clear that, as well as reversing the cuts to the Environment Agency budget and investing properly in flood defences, we must factor in climate change projections on the future cost of extreme weather. As the current approach ignores that, the Committee on Climate Change warned recently that the spending plans would result in about 250,000 more households becoming exposed to a significant risk of flooding by 2035.
Many hon. Members have raised the cost-benefit ratio rule. Currently, projects have to deliver an 8:1 return on investment. Why is that the case, when HS2 must deliver only a 2:1 return? Decent investment would reduce the average rate of return, but it would also reduce the overall amount of flood damage. Will the Government review that rule to help local authorities invest in the flood protection that they know is required?
At the very least, we need a commitment that spending on flood protection will be increased in line with the expert recommendations of the Environment Agency and the Committee on Climate Change. In considering how to fund that, a good place to start would be to redirect just some of the billions of pounds of subsidies and tax breaks that go the fossil fuel industry.
Last week, I received a report from the Sussex Wildlife Trust that sets out an evidence-based approach to flood protection that was produced by the Chartered Institution of Water and Environmental Management, which is made up of independent and professional people who are experts in their field. The report reinforces a key lesson that we need to learn from the recent floods: not only that our spending on flood protection is shockingly inadequate and that we must not have Ministers who deny the link between the burning of fossil fuels, man-made climate change, extreme weather and enormous threats to our society—threats that the Government are exacerbating through their inequitable and unscientific climate targets and their obsession with helping big energy companies to extract every last drop of oil and gas that is out there—but, crucially, that there must be a fundamental shift towards seeking to work with nature, rather than against it. Not only would such an approach benefit wildlife and nature, but it is the best way to reduce our vulnerability to flooding and extreme weather events and to increase our resilience.
Mr Redwood
On that point, is the hon. Lady a supporter of the Environment Agency’s policy in the Somerset levels over recent years of not dredging on the grounds that it might damage habitats?
Caroline Lucas
Dredging is often pulled out of the hat as if it were a silver bullet. Dredging can have a positive effect if it is done in certain places at certain times. In other places, it does not have a positive effect. In the Somerset levels, it could have been done a little earlier, but it certainly would not have massively reduced what we are seeing now. We need a much more holistic response, which is what Sussex Wildlife Trust is talking about.
Mr Bellingham
Is the hon. Lady aware that the defences around the Norfolk, Lincolnshire and Cambridgeshire fens are comprehensive and holistic in that they involve not only tidal barrages, but pumping stations, relief channels and dredging? That combined approach protects a vast amount of Britain’s farmland.
Caroline Lucas
I am very pleased to hear that, but the comprehensive approach that I am talking about must involve a much wider evaluation of how we use land. For example, we must consider what use farm subsidies are being put to and whether they are inadvertently encouraging unhelpful ways of using land. I am referring to something rather larger than the holistic approach the hon. Gentleman mentioned.
First, we know that allowing development on floodplains puts more people at risk. Secondly, we know that compacted soil and damaged uplands channel water downstream faster. Thirdly, we know that climate change is making extreme rainfall events more frequent and intense. I will outline briefly the solutions we need in each of those areas—solutions that work with nature, rather than against it.
The Government’s ongoing attacks on the planning system are a real problem. Sensible, long-term development control in the public interest is being sacrificed at the altar of mindless, short-term GDP growth at any cost. Development on floodplains and in areas of high flood risk, not just now but for the lifetime of a housing development, needs a stronger, more accountable planning system. We must ditch the current approach that casts sensible planning rules and regulations as a barrier to growth and planners, according to the Prime Minister, as enemies of enterprise.
Crucially, we know that not all decisions about development on floodplains are taken by local planning authorities. The Secretary of State for Communities and Local Government can use his power to call in or recover a planning application. So why is it so difficult to obtain basic information about this from his Department? A written question that I tabled back on 5 February remains unanswered. I hope that the message will reach the Secretary of State and that he will tell us today how many times he has exercised his power to call in a planning application to approve or reject housing or commercial development on a floodplain or in an area of flood risk.
It is simply not good enough for the Secretary of State to point the finger at local councils, nor is it good enough for him to say that 99% of proposed new residential units that the Environment Agency objected to on floodplain grounds were decided in line with Environment Agency advice when the decisions are known. What about all the others? Why will the Government not give us the full picture? The fact that my question remains unanswered a whole month later raises suspicions about whether the Secretary of State has been overruling local authorities or Environment Agency advice and allowing development to proceed in areas at risk of flooding. I hope that that is not the case, but we need to see the statistics and we need to see them now.
A month ago, I also tabled a written question on the impact of recent and future flooding on small businesses.
Andrew Percy
On building on floodplains, the view from Brighton might be quite different from that in my part of Yorkshire and Lincolnshire where such building is almost unavoidable because the land is drained marshland surrounded by rivers that drain 20% of the UK’s water. We have a desperate need of affordable housing to help local people who want to live locally. The matter is not as simple as just stopping all building on floodplains, which would price more of my constituents out of the housing market.
Caroline Lucas
I thank the hon. Gentleman for his intervention. His point is reasonable, but in areas that he describes—they are not typical but they certainly exist and he has intimate knowledge of them—the architecture could be different with houses on stilts and resilience in the building process. That is not happening right now, which is why we are seeing so much flooding causing so much misery for so many people throughout the country.
Caroline Lucas
I want to make a little more progress.
Turning to land management of uplands particularly, we need a radical rethink to take proper account of climate change and to reduce the threat to people’s homes and livelihoods, and to food security. The Department for Environment, Food and Rural Affairs recently confirmed that the rules farmers must meet to obtain public subsidies do not cover flood risk. In some cases, the conditions on farm payments may be making the situation worse through over-grazing and removal of vegetation. We must look seriously at whether that is good use of public money, and introduce changes to ensure that such payments are conditional on flood prevention.
The Government must stop their irresponsible use of public money by ensuring that flood prevention is a non-negotiable condition of all farm subsidies. Farmers and land managers know what the slow water solutions are.
Caroline Lucas
I have given way a lot, and I fear that Mr Speaker will tell me to wind up.
We need better soil management as well as better water management, not least because that reduces the silting up of river beds further downstream. Approaches that help more water to remain in the uplands, where there may be peat bogs, rather than going downstream into people’s living rooms, can seriously improve water quality and have the potential to cut water bills for households.
Finally, on climate change, I regret that the Secretary of State for Communities and Local Government is not here because his comments during the debate last week were complacent at best and reckless at worst. If he were here, he could clear up the basic matter of what he thinks is man-made and what is natural when it comes to the increased risk of extreme weather. In the same breath as he mentioned the Met Office, he said that there “might” be either short-term or long-term trends. On what basis does he query the long-term trend, let alone its seriousness? The Met Office states:
“There is no evidence to counter the basic premise that a warmer world will lead to more intense daily and hourly rain events.”
If the Secretary of State has the evidence, let us see it. The only supposed authority he offered in support of his views is Lord Lawson—not a scientist of any sort but a staunch defender of the fossil fuel industry and head of a campaign group that lobbies against the Government’s climate change policies.
When talking about what he knows about climate science, why does the Secretary of State choose not to quote a climate scientist? When he has read Hansard later, perhaps he will confirm whether he has read the recent joint report by the leading UK and US scientific institutions—the Royal Society and the National Academy of Sciences—which finds that man-made climate change is more certain than ever and will post severe threats to society and infrastructure. Will he agree to meet Sir Paul Nurse and the authors of the report to ensure that his approach to defending the realm takes account of the realities and the risks of climate change?
I accept that the Secretary of State said last week that
“the risk is there to our nation”.—[Official Report, 26 February 2014; Vol. 576, c. 335.]
Let us therefore keep to the theory of risk rather than uncertainty, which, as we all know, is a well-known tactic of obfuscation and delaying action used by those with vested interests, from the tobacco to the fossil fuel lobbies. If we talk about this in terms of risk rather than uncertainty, it is like thinking about what is more important, risk or certainty, when we decide whether to get on a plane, vaccinate our children, or insure our homes and valuable belongings, or even whether to cross a busy road. Does a rational and responsible parent say, “I’m not 100% sure that my child will definitely get a really serious disease, so I’m not going to vaccinate them”? If one has just bought a new house, is the sensible approach to say, “I’m not 100% certain that my house will burn down, so I’m not going to bother with home insurance”? No. Unless we have a science and risk-based approach to protecting UK homes and businesses from future flood risk and extreme weather, the Secretary of State will be failing in his aim to ensure that our citizens are safe.
I also object to the Secretary of State’s view that the climate debate is polarised, as he claimed, between sceptics and zealots. Organisations such as the World Bank, the International Energy Agency, insurance industry bodies, the World Economic Forum and PwC have clearly paid a lot more attention to the science than he has. These organisations, which are not in any way environmentalist, are all warning that if we continue with business as usual and fail to make radical cuts to emissions, we are on course to seeing 4°, if not 6°, of climate change within our children’s lifetimes.
Mr Graham Stuart (Beverley and Holderness) (Con)
I think the hon. Lady takes issue with the Secretary of State on the wrong point. There is a danger of hectoring. Given such overwhelming scientific evidence, it should be a straightforward matter to bring people on board in seeing that there is a risk that needs to be managed, but the debate has somehow become partisan and divided. Perhaps she, and all of us, could think about how we get our language right so that we create an inclusive approach, and then we can argue about the best response, not divide on the basis of belief.
Caroline Lucas
I thank the hon. Gentleman. I suggest that the Secretary of State is one of the first people who ought to be trying to generate that inclusive approach to climate change. Instead, he has been doing exactly the opposite in referring to people as zealots and saying that those who promote a risk-based approach to climate change are completely off the agenda. I entirely agree that we could look at our language, but let us take the fight to where it starts, which is with the Secretary of State’s response to the flooding debate last week.
I can tell, Mr Speaker, that you would like me to conclude very shortly, so I shall be brief. I find it extraordinary that although this debate is about something we can agree on—we all want to reduce the impacts of flooding on the communities we represent—many of us are not prepared to look at the likely causes of extreme weather events of the kind that we have been seeing in recent weeks. If I sound frustrated, that is where my level of frustration is coming from. As the Secretary of State spoke only of adapting to climate change rather than turning off the fossil fuel tap to prevent more climate change from reaching dangerous levels in the first place, perhaps he would like to explain to the House what 6° of climate change might look like, or even what 4° of climate change would mean for the UK, and exactly how he would adapt to those changes. So far we have seen only 0.8° of climate change, but perhaps some people in Somerset, let alone communities elsewhere in the world, might argue that the situation is already dangerous.
If this Government want credibility as regards protecting the UK from the increased risk of flooding and other climate risks, we need radical action to cut emissions in line with both science and equity. That means leaving about 80% of known fossil fuels in the ground, not handing out tax breaks to companies to find and exploit yet more reserves of oil and gas that we cannot afford to burn. It means not just accepting but strengthening the fourth carbon budget in line with the science, to secure the economic and employment benefits of leading the transition to a zero-carbon economy. It means leadership to ensure that action on climate change is not just an issue for the Department of Energy and Climate Change, but a top priority for all the Government.
The flooding has led to many words being spoken in the House about resilience, and the importance of taking the right long-term decisions for our future and that of our children, but action, not just words on climate change, is the litmus test of whether or not they are meaningful.
Mr Speaker
Order. I have not imposed a time limit on Back-Bench speeches, but it might benefit the House to know that there are still 12 right hon. and hon. Members seeking to catch my eye. If Members think in terms of speaking for 10 minutes each, or preferably a little less, it should be possible readily to accommodate all who wish to contribute. The Chair will call the Front- Bench speakers to wind up the debate at approximately 6.30 pm.
Geoffrey Clifton-Brown (The Cotswolds) (Con)
I am delighted to catch your eye in this important debate, Mr Speaker, and I will certainly adhere to your strictures. I am grateful for the opportunity to follow my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), and I congratulate her on chairing the Environment, Food and Rural Affairs Committee and on her clear knowledge of this subject in her speech.
I want to cover succinctly aspects of the performance of the Environment Agency’s and the statutory water undertaker in my constituency, Thames Water. I will then consider some of the problems with the planning system, in particular building on a floodplain and the unknown and uncertain liabilities that has caused, and the difficulties with drainage and with insuring some of those houses under the new Government Flood Re system.
In common with a number of my hon. Friends, a number of houses in my constituency—often the same houses in the same streets—have been flooding for a number of years. This is not just water flooding; it is also sewage flooding. Water flooding is bad enough, but if a house is flooded from a sewer, it is twice as bad because it takes even longer to clear up. I want to examine critically the performance of Thames Water’s underinvestment in the sewerage system in my constituency. Areas of my constituency that are affected cover Moreton-in-Marsh, Fairford, Lechlade, Cirencester, Siddington and South Cerney, to name but a few.
I hold regular half-yearly public flooding meetings in my constituency. They are recorded, with action points, and bring together all the agencies—Thames Water, the Environment Agency, the county district council and relevant town and parish councils. In that way, I can hold officials to account.
James Morris (Halesowen and Rowley Regis) (Con)
My hon. Friend talks about bringing together the community around flood issues, but one point about resilience, particularly in my constituency, has been the work of the Halesowen flood committee led by Claude Mosseri and his wife Ruth. They have brought together the relevant agencies to do vital work around the Illey brook area of Halesowen. Resilience is very much about local communities taking local action to bring the agencies together.
Geoffrey Clifton-Brown
My hon. Friend is exactly right. Before I held the public meetings I found that each agency was shuffling responsibility off to one of the other agencies. It is essential that all agencies and all tools in the box are unleashed to try to solve these flooding problems.
The meetings have produced results in parts of my constituency, but there is still a lot to be done. In particular, problems with sewage flooding arise because the sewerage systems are very old. The moment we have any sort of flooding the water table rises, water gets into the sewerage system, and the pumps are incapable of removing the sewage from people’s houses, leading to very difficult issues. I will be encouraging Ofwat to take a greater interest in this subject—indeed, I will invite it to my public meetings—to see whether we can encourage Thames Water to carry out what it says it will, and invest more in our sewers.
Bob Stewart (Beckenham) (Con)
One problem seems to be that there is no way we can control the water table from going up and down. That is a severe problem, and there does not seem to be a technical solution to sorting it out. That is happening in my constituency more and more.
Geoffrey Clifton-Brown
I agree with my hon. Friend that whether or not climate change is taking place and is caused by human activity, there is no doubt that we are getting an increased number of events with increased rain intensity, and we must therefore have better defences against flooding. There is no reason in the 21st-century why we cannot have sewerage systems that cope with such events. In particular, as I shall come on to say, we need sewerage systems that will cope with new development, which often adds to existing problems.
There is a perception that the residents of the Cotswolds, who live 100 miles away from London but who are still in the Thames Water area, are getting a very poor deal. It is outrageous that all Thames Water customers will be charged an additional £70 to £80 a year for at least 10 years to pay for the huge Thames tideway tunnel, when we in the Cotswolds cannot get the increased investment we need to deal with sewage flooding. The regulator Ofwat has to look at that. The time for talking in the Cotswolds is over. Thames Water has had more than enough time to carry out all its design work. We need more sewerage investment.
Equally, we need the Environment Agency to take the lead in planning how to deal with catchment areas. An exchange took place with the hon. Member for Brighton, Pavilion (Caroline Lucas). The answer is not just dredging, but considering the whole catchment area using all the keys in our locker to deal with the problem. That is what I am asking the EA to do in my constituency. For at least three years, it has been talking about coming up with an upper River Churn catchment area plan, but I have still yet to see that plan. Not only do we need to see adequate investment from the EA to deal with river flooding problems, we need to encourage Thames Water to invest adequately to tackle sewerage problems.
On new developments, we have, unfortunately, seen a rash of developers in my constituency. I accept that we all need new houses because the population is rising, but we need—I say this most emphatically to my hon. Friend on the Front Bench—new houses in the right areas. If we build houses on floodplains we cannot complain when we get subsequent problems. In South Cerney, for example, a recently passed new development is right next door to an estate that has had sewerage flooding problems. How daft is that? Fairford and Lechlade have each seen new developments passed for developments to be built on the floodplain. That is also daft.
We need to examine the system we have at the moment. The Environment Agency is a statutory consultee for large investment, but it has to take into account only one-in-100-year events when considering whether a development on a floodplain is viable. That is completely unrealistic and should rapidly be brought down to a design phase of one-in-25-year events. The statutory water undertaker, Thames Water, is not even a statutory consultee; it is consulted by the local planning authority often only as a matter of principle. Even then, all it has to do is to say that the sewerage system is capable of being connected to the new development, not whether the new development will make existing sewage flooding worse or whether the sewer needs upgrading. This is a legal grey area. Thames Water has been taken to court several times for trying to exceed its powers. I say to my hon. Friend the Minister: for goodness’ sake let us look at this and try to get the legal framework correct.
An even more important aspect of the planning system is drainage: sustainable drainage systems. We are building up for ourselves a huge and unknown liability from the lack of proper design of drainage systems. Currently, the local planning authority monitors the drainage system for a new development. Developers, with plenty of funds behind them, employ clever drainage engineers who take their percolation tests in the summer when everything is nice and dry—when, of course, the drainage works properly—instead of being made to take them in the winter when the water table is high. They then ask the developer for a section 106 payment. Often, that payment is inadequate. Under the Water Bill, as my hon. Friend the Member for Thirsk and Malton knows, SUDS will have to be licensed by the county council. Until that happens, we have a huge and unknown liability from SUDS, which are often completely inadequate and designed for one-in-100-year events. I say again that they should be designed for one-in-25-year events. We should not be building willy-nilly on the floodplain without thinking seriously about what we are doing.
A lot of my constituents have difficulty getting insurance. The new Government Flood Re system will not cover houses built after 2009, so, in relation to all recent applications where houses have been built on the floodplain, we are creating a problem for ourselves. They will undoubtedly flood at some stage, yet the owners of those houses will not be able to get flood insurance.
I welcome the Government’s efforts to ensure that everyone who buys a house on a floodplain is aware of having done so, but it is one thing for people to be aware of it during the sunny summer months when they buy their houses, and a completely different thing for them to be aware of it in the winter, when the rain falls in bucketfuls.
Adam Afriyie (Windsor) (Con)
Like my hon. Friend’s constituency, mine has been pretty much under water. Does he agree that if we go ahead with many of the proposed flood alleviation schemes—the bigger schemes that are intended for the future, such as the extension of the Jubilee river all the way down to the Thames—far more land will come back into use, and we shall need better planning control to ensure that the flood meadows are not removed from the current system?
Geoffrey Clifton-Brown
My hon. Friend is entirely right. If we concrete over vast areas, particularly on the floodplains, they will no longer be able to absorb water, which is what they were designed to do in the first place. In many instances, they were designed specifically as flood meadows. Worse still, in the event of heavy rainfall they will empty the water into the catchment very quickly. That is what has caused flooding downstream.
I suggest to the hon. Member for Brighton, Pavilion that we should consider the catchment areas as a whole, and decide how best to deal with what are to remain floodplains. In my constituency there is a scheme enabling water above Cirencester to be impounded so that it can be gently released when the rainfall has subsided. We should be doing much more of that sort of thing, because it is much cheaper than building expensive houses and then having to provide flood defences retrospectively.
Let me say to my hon. Friend the Minister that, while I commend what the Government have done, we need to look carefully at investment, particularly investment by the water undertakers. It is not a question of public funding; it is simply a question of equity between the profits that are given to shareholders and the profits that are reinvested in sewerage systems. I repeat that it is outrageous that Thames Water is being allowed to charge my constituents between £70 and £80 a year for the Thames tideway tunnel when they are not benefiting from the investment in sewerage flooding systems that they justly deserve.
Let us, for goodness’ sake, look at the planning system. Let us not keep building on the floodplains, because doing so is creating a great many uncertain liabilities for the future.
Peter Aldous (Waveney) (Con)
Three months ago, the storm surge hit the east coast and caused considerable damage in a number of coastal communities including Lowestoft, in my constituency. Before Christmas I secured an Adjournment debate in which I highlighted the items of immediate concern. Today it is appropriate to review the situation, and to highlight what went well and the instances in which we can and must do better.
In Lowestoft, a small geographical area was hit very hard. The community rallied round and the area is gradually returning to normal, but many people will not be back in their homes for a number of weeks, and for some life will never be the same. The repairs to the sea defences have still not been completed, and it is a race against time to get the beaches open for the important tourism season. We need to learn lessons from the night of 5 December and consider how we can best manage flood risk, making the best possible use of the available resources, which will be limited. We must recognise that events such as those that we have witnessed, either directly or on television, will become more frequent.
There are three instances in which I believe that we should be doing things differently. First, we need a new framework for the management of flood risk from rivers. The Government’s management of flood risk must be simplified and streamlined. There is too much duplication of effort and inefficient use of resources, with funding shared between five levels of government. We need better co-ordination and simplification. All work related to flooding should ideally take place in one Department. Locally, a whole-river approach to flood management should be adopted, from source to the sea. Each catchment and each river is different, and each should be managed by local people, who invariably know best.
Since the scrapping of the National Rivers Authority in 1994, a more fragmented approach has been adopted, and we now need greater certainty and local flexibility. It is also important not to become fixated on specific ways of managing flood risk: it must be recognised that different solutions will be appropriate in different settings and on different rivers. I make this comment with specific regard to the issue of dredging. In some places it will solve a problem by creating additional capacity for holding water, while in others it may exacerbate a problem. In managing a river, it is important to use all the tools in the box, whether dredging, desilting, repairing of banks, the managing of vegetation downstream, slowing the flow, storing water or improving infiltration upstream.
There is a need for better and more regular ongoing maintenance with investment in pumps and drainage infrastructure. More licences should be granted to farmers to undertake regular minor work such as clearing blockages, desilting and vegetation maintenance, and I draw attention to my farming interests as detailed in the Register of Members’ Financial Interests.
Homeowners and businesses should also be armed with the tools and the information needed to defend their properties. There is a need to build resilience into the defence of individual properties. The £5,000 repair and renew grant for affected homes and businesses can play a very important role in achieving this, whether through the fitting of flood boards, covers to air bricks and the insulation of valves to prevent the backflow of sewage.
Alok Sharma (Reading West) (Con)
I held a public meeting last week on flooding issues in my constituency and those who are flooded welcomed this £5,000 repair and renew grant, but some who have not experienced internal flooding were concerned that they may do so in future. Does my hon. Friend share my view that the Government should consider introducing a scheme whereby they provide part-funding for those who want to make their homes resilient or have some kind of tax credit for that purpose?
Peter Aldous
My hon. Friend raises a good point. The £5,000 grant is a good way for individuals to make their properties more resilient. In Bevan street east in Lowestoft the property with flood boards was the one that had very minimal flood damage. We should be building on this scheme where the flooding happened this time and also look at other areas that are vulnerable.
It is also important that local communities that have been affected by the floods are fully informed and advised as to what they should do. It is important to plan and rehearse flood plans so as to eliminate the need for frantic and ultimately useless activity once a flood has occurred.
Roger Williams (Brecon and Radnorshire) (LD)
The hon. Gentleman is making an important point about what householders can do to protect their own property. The Pitt report after the 2007 floods recommended that in flood risk areas insurance notices should include information on flood risk and the simple steps that can be taken to mitigate the effects. Does he agree that that would be a very good thing?
Peter Aldous
I agree entirely. One thing the Government need to be doing is making sure advice is provided through the local authorities on this £5,000. Support and advice must be given to local communities, in particular in streets where this problem is occurring, to enable them to put in place sound and practical arrangements as soon as possible.
Mr Graham Stuart
Does my hon. Friend agree that it is also important that the £5,000 is made available in the most sensible manner possible, so that those who have been repeatedly flooded over a number of years are eligible, rather than just those who have had a one-off event, however severe, which is unlikely to repeated for a long time to come?
Peter Aldous
The £5,000 grant has clearly hit the right note across the country, and it is no doubt right that the Government should review very carefully where it is provided.
In my constituency, the preparatory and warning work leading up to the storm surge generally went well. There is scope for improvement in handling the mop-up afterwards, however, and I know the councils are looking at doing that. It is also important to support those who are facing change and uncertainty, even if that is in the long term. Long-term expensive works are required to defend the communities of Corton and Kessingland in my constituency. It is necessary to work with those communities to involve them in finding a permanent solution, even if it is going to be very expensive and some way hence, so that they have confidence that in the long term such solutions will be in place, rather than leaving them feeling marooned and isolated, as they perhaps do at the moment.
Secondly, I am concerned that the existing mechanism for accessing new flood defence schemes is deficient, in that it does not give sufficient weight to economic considerations. It is important that when the Government are determining whether to provide financial support for flood defence schemes, proper account is taken of the economic benefits of the proposals. The benefit-to-cost rules that are currently applied do not do that. In the 2008 Pitt review the recognition of the need to protect the economy is too limited, and there are similar concerns about the flood and coastal erosion risk management plan introduced in 2011.
In my constituency, the future economic viability and vitality of Lowestoft are highly dependent on investment being made by energy companies in the port area, the very area where much of the flooding occurred on 5 December. In order to attract that investment, which would regenerate the area, bringing new business and new jobs to the town, it is important that robust and comprehensive coastal and flood defence arrangements are in place. Proposals to achieve that will be submitted to the Department shortly, and I shall be lobbying vigorously for the necessary funding.
Finally, there is a need for a new approach to coastal erosion and protection, and for a longer-term plan and increased investment in sea defences. Many of the sea defences in Suffolk and Norfolk were put in place by the Eden and Macmillan Governments after the 1953 floods and are now in need of urgent repair, upgrading or replacement. Given the events of 2007 and 2013, it seems these sorts of problems are likely to become more frequent in the coming years. Sea levels on the Suffolk coast have been rising since records began in Victorian times, and since 1953 they have been rising by 2.4 mm per annum. When the impact of climate change is added, it is clear that there is a need for urgent action. In Lowestoft, Halcrow and BAM Nuttall have made the assessment that whereas the previous estimate was that a 1953-type flood would occur every 1,000 years, it could now take place every 20 years.
The UK’s approach to coastal defences over the past 20 years should be contrasted with that of the Dutch. After the 1953 floods, they designed their sea defences to withstand a one-in-4,000-year flood, whereas ours were designed to withstand only a one-in-1,000-year flood. The Dutch have pursued a different approach: the provision of their coastal defences is fully integrated with the provision of other infrastructure, be it airports, harbours, roads, houses or factories. In the UK, coastal flood defences have tended to be an add-on and have all too frequently been cut in times of austerity. The Dutch do not rely solely on hard defences, and a system of dams, dunes and dykes has been put in place which enables them to withstand a one-in-10,000-year storm. By contrast, neither the Pitt review nor the flood and coastal erosion management plan properly addresses coastal erosion and flooding. The latter does not fully reflect the differences between inland flooding, which is temporary, and coastal flooding and erosion, which can be terminal for affected properties and assets.
The storm surges that occurred along the east coast in 1953 and 2013 were the result of a combination of events: very low atmospheric pressure over the North sea, which caused the sea level to rise dramatically; high astronomic tides; gale force winds; and rainfall. On both recent occasions, we escaped by the skin of our teeth, although I concede that what happened in 1953 was horrific; in 2007, the wind dropped in the nick of time, and in 2013 the wind was blowing in a northerly direction and there was no heavy rainfall. I fear that it will not be third time lucky, and it is important both that new defences are put in place as soon as practically possible and that we adopt a different approach to the managing of flood risk.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
May I apologise to the House for my lateness? Unfortunately, I got stuck on a train from Newcastle for reasons I do not need to detain the House with. I will take as little time as I can so as not to abuse the position that I have been given in this debate.
I thank the Minister and the whole team for all their work—I am talking about the Prime Minister all the way down through the various ministries. I also want to thank Opposition Members too. The Leader of the Opposition visited my constituency. He was extremely magnanimous with his time and he did not, dare I say it, make a spectacle of himself. Unlike many Members, I welcome ministerial visits and Ministers seeing what is happening in the area. This Minister has been to the region more than most to chair a number of meetings.
We are putting together a report that will be given to the Prime Minister and the House later in the week. As the Minister knows, we must change the whole way that we deal with this problem. Members have expressed the hope that we never experience the same thing again, but as sure as night follows day, we will and we must be aware of that. It is as certain as death and taxes. It may not be the Somerset levels that are affected, but it will be somewhere. There must be fundamental change that crosses the political divide and that is agreed on by both sides of the House.
The one hurdle that we all have to overcome is the Treasury. It will try to stop us spending the money that is required to put in defences and the works that are needed to ensure that the flooding does not happen in the future. Members from across the House must make it clear to the Chancellor that we have to be given the money that we need. We are the sixth-largest economy in the world, yet here we are, unable to raise money to defend our own people from the most basic problem faced by man—certainly in my constituency—since prehistoric times, which is water. We manage it well. When my hon. Friend the Member for Newbury (Richard Benyon) was Minister he put in place a lot of changes to try to make the system work. Although I occasionally berated him in the local press, I respect him for his hard work. [Interruption.] I tried to do that without a smile and failed dismally. It is crucial that we take responsibility for the problem and say that each area will have to be defended properly.
Miss McIntosh
May I welcome my hon. Friend to the Chamber? I have a question that is vexing the House and other colleagues in Somerset. If we look at the whole management system of the Somerset levels, to what extent could the damage have been prevented if we had had both upstream flood management storage as well as regular maintenance and drainage downstream?
Mr Liddell-Grainger
My hon. Friend has hit the nail on the head. She is most astute. One of the problems is that we do not have the capacity to pump into the river below a certain level. I am talking about the area on the border between my constituency and the constituency of my hon. Friend the Member for Somerton and Frome (Mr Heath). What happened was that the river backed up. We could not get the water around. We have two points into the sea; one is through the River Parrett and the other is through the King’s Sedgemoor drain. Both are not able to take what we need to pump into them. Nearly 60 square miles of land are underwater, which really focuses our minds on the problems faced by our constituents. Although we have not lost many properties, it has devastated the tourism industry and many other things in the local area. My hon. Friend the Member for Tiverton and Honiton (Neil Parish) knows from his long experience of farming nearby how dangerous these areas can be.
The Minister has made it quite clear that local input is needed. The internal drainage boards and the local Environment Agency—I am not suggesting asking Lord Smith for one second, nor would I—have an enormous input to make, but that must be done in conjunction with local people. That is why the meetings that we have been holding in Sedgemoor or Somerton and Frome have been so important; we have been able to use that local input. I was rather worried when the EA sent John Varley, whom I have met a few times. I find him the most impossible man, although I am sure that my hon. Friend the Member for Newbury would disagree with me. It is obvious that a lot of people have others’ best interests at heart.
We must do three things. First, we must look at the Bridgwater barrage. That will cost an enormous amount of money, but it is vital. Secondly, we must look at the pump system.
Neil Parish (Tiverton and Honiton) (Con)
My hon. Friend talks about the barrage across the River Parrett, which is absolutely essential. The £200 million cost of raising the railway across Sedgemoor starts to make the barrage look extremely cost-effective. The railway would not be flooded if that barrage were there to stop the sea going up the Parrett.
Mr Liddell-Grainger
I absolutely agree with my hon. Friend. This year, we managed to shut the main railway line and the A303, and water was lapping against parts of the M5. We really could have stopped tourism in most of the west country. I am glad that that did not happen; it is obviously good news.
Mr Heath
I have worked closely with the hon. Gentleman in this exercise. He will agree that the elements that we need from the Government are, first, the initial dredging; secondly, the commitment to build a sluice, or barrage, across the Parrett; thirdly, a funding mechanism for local IDBs or local authorities to fund the maintenance; and fourthly, the long-term management of the whole river catchment area—something that we knew back in the 1980s and ’90s, when we were working on it, but it was forgotten.
Mr Liddell-Grainger
My hon. Friend knows better than I do—he is a Somerset man; I am a usurper from Scotland—that this is an absolute tale of disgrace and woe. It is appalling, and not just one Government are involved; it goes back through many Governments, and it has been an absolute disaster. But he is right: we must sort out the pumps, the rhynes—ditches—the bunds and the dams. We must do this now. Unless this happens quickly, we will be back here, probably next year, with the Opposition asking, “What on earth did you get wrong?” It happened last year; it happened in 2000; it will happen again.
The most difficult thing that we must face is that, basically, everyone thought that Somerset was shut. We had half-term; tourism died completely. That affected the west country because everyone thought that the railway was shut and no one could get through. Therefore, we ended up costing the economy millions.
Adam Afriyie
My hon. Friend is making an impassioned speech, after a brisk rush from the train. Things are the same in my constituency; local businesses have been shut down. Some of the longer-term flood defences—the long-term plan to make our country more secure—would actually save the economy money. Perhaps not in the first five or 10 years, but over a 20-year time frame. If the Treasury put the money into schemes such as the lower Thames alleviation scheme, the money would be returned in savings from flood insurance, from businesses not closing and from savings across the economy overall.
Mr Liddell-Grainger
I could not agree more with my hon. Friend. His area has a slightly different type of flooding. We are almost unique. We have massive amounts of land to play with. We can put in the bunds, the pumps and all the rest. Unfortunately, there are buildings right up to the Thames, so there must be a different solution, on which I am sure that my hon. Friend is already making pretty good representations to the Minister, and he will continue to do so.
My hon. Friend’s fundamental point is right: flooding has cost this country millions in the past few months. We cannot ignore that. The Treasury must say what is the cost to the sixth-largest economy in the world of what we have lost. If we can write off the whole of half-term, what will things be like at Easter? We will not have the water cleared by Easter, and the railway will not be open by then. We will still face fundamental problems in Somerset. That will knock on to Devon and certainly Cornwall. Where will we be?
We must sort this out. Therefore, my right hon. Friend the Chancellor must take the brakes off. Allow us to put in our reports—on Thursday in our case, and I am sure soon after in the case of the Thames and many other rivers. The Vale of York needs to be looked after. If we do not get it right, we will be sitting here again discussing the same thing, and that is not acceptable.
Richard Benyon (Newbury) (Con)
I start by referring hon. Members to my entry in the Register of Members’ Financial Interests and by apologising to the House for legging it earlier. I had to host a long-standing event on the Terrace for land-based colleges, and I thought I should stick to that diary entry.
I remind the House that 55,000 properties were flooded in this country in 2007, and 2,500 of them were in my constituency. That was a devastating experience. One house being flooded is devastating for the individual householder, and none of us must ever underestimate the impact that this problem has on individual households. This year, approximately 7,000 properties have been flooded across the country, including 140 in my constituency. It is worth reminding ourselves that 1.3 million homes did not flood because of good-quality defences that have been built under this Government and previous Governments. Many more properties have been protected as a result of the combined efforts of various agencies and not least local volunteers, who have been unbelievably effective in my constituency and in many other constituencies. The emergency services worked to protect properties during the floods by putting up flood defences, pumping out drainage systems and being on hand. I also commend local authorities, the Environment Agency and many others.
Drainage boards are unsung heroes on flooding. They do extraordinary work, and they are successful because they use local knowledge and have real expertise. They understand how to manage water. I pay tribute to my local authority, West Berkshire council, and particularly Carolyn Richardson, its emergency manager. At an early stage, following the Pitt review and the 2007 floods, she took on responsibility for the local authority’s emergency response systems, feeding through into silver and gold commands, which come into effect for events such as those that have occurred in the past few weeks.
The response by local communities where flooding has taken place, or where there is a threat of flooding, has been quite extraordinary. Friends and neighbours are to be commended for their actions, and in those circumstances we see Britain at its best and communities at their best. Local people have done what they can to help people in their hour of need. There is an ongoing emergency. In the Lambourn and Pang valleys, we have historically high levels of groundwater, and houses that had not been flooded have now been flooded. A number of people are absolutely exhausted as a result of their constant efforts to keep floodwater and sewage out of their properties. We are not yet in the recovery stage.
I am glad that we seem to have moved on, both in the House and in the media, from a rather sterile, binary argument about the need to dredge or not to dredge: the virtues of dredging were opposed by those who said that it was wrong. We seem to have moved on and adopted more sensible thinking. The worst time to make or change policy is in the teeth of a crisis, particularly as we sometimes feel the need to play the game of satisfying the 24-hour news agenda. Parts of the press that I have come across in recent weeks and years—they know who they are—have asked me some of the most stupid questions I have ever heard. I am glad that this ended up on the cutting room floor, but I was asked by one reporter: “Should the Government apologise for the floods?” A Radio Bristol reporter, who I think had just done a course on aggressive interviewing, once asked me, “It’s been raining for days down here—what are you doing about it?” That kind of an agenda and ludicrous editorial pushing, which says to reporters, “This story needs legs: go out there and find someone to blame”, does not show our media at their best. We seem to have moved on, and recently there have been some interesting pieces of work that have begun to show the complexity of the problem we are dealing with.
Mr Graham Stuart
Will my hon. Friend answer two questions on the framework within which this is judged? First, do we need to give more power and resource to local determination? Secondly, do we need to look at the overall framework? Holland has statutory standards that have to be observed, and that trigger the funding, taxation and resource to ensure that, even when flooding is not in the public eye, it continues to be worked on.
Richard Benyon
I think Pitt was right when he said that the whole system had been too centralised and needed to be decentralised. The Chair of the Environmental Audit Committee disagrees. She wrote a very rude comment about the way we enacted the Flood and Water Management Act 2010 and did precisely what Pitt recommended. She said, “No, it was all terribly bad and a waste of money” and that she strongly believed it should all be centralised—I may be paraphrasing, and if she was here she would probably leap to her feet to say that what she had said was not so simplistic. Where local lead flood authorities are good, we are seeing the best sort of devolution of power and responsibility, and we need to see more of that. Where they are not living up to that, we should find ways of making it happen. We discovered through Exercise Watermark, for example, that some are not playing their part, and that some agencies are not fitting into that locally. Water companies were partly to blame at that time, but I do not know whether that is still the case.
Alok Sharma
I share West Berkshire council with my hon. Friend and our right hon. Friend the Member for Wokingham (Mr Redwood). I, too, would like to put on the record my thanks to Carolyn Richardson and others who have done such a great job over the past few weeks. Local residents in Purley in my constituency have decided to form a flood action group as a way of getting local people together to liaise with the Environment Agency and others. Is that something my hon. Friend would recommend other communities look at, working together to find a local solution?
Richard Benyon
I applaud the residents of Purley, because I have seen that approach work not only in my constituency but right across the country. The National Flood Forum has a cut-and-paste organisation for local communities to pick up and run with. It is a superb organisation with real knowledge and expertise. I know that the Department and the Environment Agency will also assist local communities in setting up a flood forum. The difficulty is that communities that have never been flooded will be flooded. I entirely agree with my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) that there will be new flooding, as we all know, and it is in those communities that we want lead local flood authorities to start getting voluntary action going, with flood wardens, parish councils getting involved and local communities setting up those sorts of organisations.
I am guilty of not responding to the second point my hon. Friend the Member for Beverley and Holderness (Mr Stuart) made, on whether we should introduce a statutory activity. I blow hot and cold about Pitt’s recommendation to create a duty on fire and rescue services to prepare and be equipped to deal with flooding. In my constituency over the past few weeks, we have seen Tyne and Wear fire and rescue service, Cheshire fire and rescue service, East Yorkshire fire and rescue service and many others, all coming through the centrally controlled asset management register, which brings precisely these sorts of assets to our constituencies when we need them, and they are still there today doing wonderful work. Something is happening, and perhaps more can be done.
Miss McIntosh
I pay tribute to my hon. Friend for the work he did as Minister. Is it a matter of regret to him that we still do not have sustainable drainage systems in place? Does he accept that one of Pitt’s core recommendations was to end the automatic right to connect and make IDBs, water companies and others statutory consultees on future planning applications?
Richard Benyon
I am sorry, Mr Deputy Speaker, but I was not aware that there was a time limit and will race through my final remarks.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Just to help the hon. Gentleman, there is a voluntary time limit of about 10 minutes.
Richard Benyon
I will be as quick as I can, Mr Deputy Speaker.
My hon. Friend the Member for Thirsk and Malton makes an important point. It is a matter of regret that we have not yet brought forward the sustainable drainage provisions, which were the subject of much discussion. I can assure her that I wish we had brought them forward sooner. When they are brought forward, they will make life much better. On the automatic right to connect, I am also on record as agreeing with her on many points.
My most important point today is that we should not look at England’s flood problems through the prism of one area’s hydrology—particularly that of the Somerset levels, which have a complex hydrology. Looking at the Somerset levels as one cohesive hydrological problem is a mistake: parts of them did not flood, or did not flood so badly this time, possibly because of actions that had been taken.
The most important thing we can do is listen to the experts. A very good report was published last week by the Chartered Institution for Water and Environmental Management. We do not use CIWEM enough; its 10,000 real experts are at the beck and call of the Government, the Opposition, companies and local authorities. They have produced a really important report. I brought it with me, but someone has nicked it. [Laughter.] That is what people get if they leave their papers in the House. The report is really good and I suggest that hon. Members read it if they have not done so already. It shows some of our difficulties in managing flood risk and the problems of dredging indiscriminately.
We all have experts in our constituencies. One of mine is Dick Greenaway, who was the surveyor for the Thames Conservancy but has now retired. He has fascinating knowledge of the history of flooding. After the 1947 floods, an enormous amount of dredging took place in the River Thames. A lot of the experts of the time said that it would not work and it was being done for political rather than proper hydrological reasons. The dredging was picking up bronze-age remains close to the surface of the river bed, showing that it had not changed for a long time. Dredging can cause more problems. Since we stopped dredging the Thames to any large degree, the base of the river has dropped because of the action of the river and the change in climate. We ignore people such as Dick Greenaway at our peril.
In conclusion, we should now turn our attention to land use. We have an enormous amount of work to do in joining up land use issues, common agricultural policy reform, the drainage activities of some landowners and land managers and our management of rivers in respect of the water framework directive or flood problems at a certain point or further downstream. Some of what I have seen around the country has been very damaging in terms of flood problems lower down. We have to address that.
Mr Crispin Blunt (Reigate) (Con)
It is a great pleasure to follow my hon. Friend the Member for Newbury (Richard Benyon). I agree with his advice to listen to experts; we have just had the privilege of listening to his expertise from his undersung time as Minister with responsibility for these issues.
I speak as one whose home has flooded; what I bring to the debate is the ability to speak as someone who has had that misfortune. I am slightly confused about the number of people who have been flooded in this round of utterly dreadful weather. The number of people flooded in Kent and Surrey around the Christmas period appears to be 7,500. Now we are being told that the number is about 7,000 for the whole country, although many hundreds of homes in various constituencies have been flooded since then. Will the Minister give us the numbers and say on what basis a comparison is being made between the 55,000 who were flooded in 2007 and the number who have been flooded this time?
The central point made by my hon. Friend the Member for Newbury was that a great number of people owe the security of their homes to the measures that have been taken since 2007, and he was correct. Given how awful the weather has been, we should reflect that things could have been a great deal worse. In common with what other Members have seen, my experience of having been flooded has been that friends and neighbours have been absolutely terrific in rallying round. I am grateful to my immediate neighbours for the help that they afforded me and my family on Christmas eve and subsequently.
I also want to commend—I declare an interest, of course, as a flood victim—the exemplary behaviour of the insurance industry in my case and all the others I have seen. It appears to have stepped up to the plate and done what it was supposed to do. [Interruption.] The hon. Member for Kingston upon Hull East (Karl Turner) says from a sedentary position that it has not. Obviously, I would want to see that evidence and look forward to him making it clear. All I can do is reflect on my own experience and other reported cases. It is very easy to bash the insurance industry, but according to the evidence available to me it seems to be doing everything it should in the current circumstances.
I commend my hon. Friend the Member for Newbury on the Flood Re legislation. I note that the Select Committee’s report states that there should be a requirement to detail exactly how the scheme will work, but I assure my hon. Friend that it has been an absolute lifeline for people in my position that the value of our principal asset has not been utterly destroyed. Many thousands of people are immensely grateful for the work he has done in bringing that scheme to the starting gate.
I also want to place on record my thanks to the Government for the measures they have taken during the course of this crisis. The £5,000 grant to make my house, along with all the other houses that have been flooded, more resilient is immensely sensible. I want to take some measures, but they are plainly not insured so the insurance company will not be able to address them. The grant is, therefore, of immense help. I am certain that my reaction will be mirrored by everyone else who has been flooded. It is a really sensible, helpful proposal by the Government. From what I have seen of how people can apply for the scheme, it is being managed appropriately. Council tax relief for people who are no longer able to occupy their homes is also entirely reasonable.
I want to make two central points, one of which picks up on those made by the hon. Member for Brighton, Pavilion (Caroline Lucas). She spoke of the need for us as a country to invest sensibly in flood protection and I agree entirely with her. The Pitt review was right and the scale of our investment in flood defence needs, to be frank, a step change. It has been said that an increase of £20 million a year is needed over the course of 25 years to get to the right level. Given how fast the climate seems to be changing, however, I do not think that is enough. We need to get to the level of expenditure envisaged by the Pitt review rather quicker than the 25 years he recommended when he wrote the report. That seems to be self-evident.
As a number of hon. Members have suggested, this is a sensible investment measure because it will result in huge savings. We ought to look at the expected 8:1 return currently being examined by the Environment Agency with regard to investment schemes and the cost-benefit analysis. That does not seem right to me.
I agree with the hon. Member for Brighton, Pavilion on some matters on which we have co-operated, but I am afraid that I buy Lord Lawson’s general approach. There is a limited amount that the United Kingdom can do on its own to address global climate change. We have to try to carry the other nations of the world with us in order to do what we can to try to improve the climate, but I agree with his general proposition that limiting our ability to grow our economy and to have the wealth to create the protection schemes would be the wrong approach. If we hobble our economy by trying to reduce climate change through occasionally economically illiterate energy schemes, we will simply not be able to afford flood defences or have the money to defend ourselves against the consequences. It is also highly unlikely—we would be extremely lucky if this happened—that we would be able to carry the Indians, the Chinese and the rest of the world with us towards the standards we will deliver in Europe.
Caroline Lucas
It is precisely the people who seem to think that investing in the green economy is somehow a distraction from getting out of our economic difficulties who are economically illiterate. If we put resources into the green economy—insulating every home and properly investing in renewable energies—it will be good for the economy. The green economy is the one bit of the economy that is doing pretty well, so it is a false dichotomy.
Mr Blunt
It is not, if Governments of all hues are tempted to decide which particular subsidy they give to which particular scheme, regardless of their environmental merits in continuing to reduce greenhouse gases. That is what we have seen: when we are in positions of Executive authority, we are all tempted to have our pet schemes to deliver. We should always look to reduce the totality of our contribution to carbon change, consistent with what can be delivered around the rest of the world, so that the whole world acts together. We should not unfairly handicap ourselves, but try to carry the rest of the world with us, and allow the market to make a sensible decision about how we address humanity’s contribution to climate change.
In his extremely good speech, my hon. Friend the Member for Waveney (Peter Aldous) elucidated all the very sensible measures that ought to be taken by any community facing flood risk. I can only commend his speech to other hon. Members and to all those interested in this field.
From my experience, I know that the only way my home can be protected is if the schemes happening around Gatwick airport, the area from which the water comes down the River Mole to me, are decent floodwater storage schemes. They need to be properly designed by the Environment Agency to ensure that the water is stored and not simply poured off the second runway—God help us if we get it—and sent downstream to flood communities living below Gatwick.
I know that the Environment Agency has taken a kicking from many quarters, but I must say that from what I have seen it appears to be the best reservoir—that is the right term—of expertise for our country. We should support and use it, and I commend the work of the officials I have met. I am delighted to see my hon. Friend the Member for Newbury nodding: if he is nodding, I am pretty satisfied that that judgment is right.
Having declared my interest, I conclude by thanking the Government for the way in which they have managed the crisis over the past two or three months. The proposals that they have put in place, which are inevitably for the short and medium-term, are what I would expect the Cobra co-ordinating mechanism to do in the circumstances. However, there is a long-term issue to address: the scale of our country’s investment in flood defence is not adequate, as was identified between 2007 and 2009, and I suggest that we need to address it faster than we currently propose to do.
Mr Robert Walter (North Dorset) (Con)
Looking at the empty Opposition Benches, I wonder whether that UKIP councillor had a point—even if the point was wrong—about God moving in mysterious ways, and whether flooding does not affect Labour constituencies.
Like those of many hon. Friends, towns and villages in my constituency were flooded before Christmas and are still flooded. Just last Friday, I was in the village of Sixpenny Handley, high up on Cranborne Chase, where the flooding—a combination of record groundwater levels and excessive surface water—is just not going away. Residents are still pumping out their homes and the streets are awash with water that will not go away. There has been a very serious case of raw sewage overflowing from a local sewage plant, which was swamped by storm water that should have been kept separate.
That is just what has happened in Sixpenny Handley. I could tell the House stories about the market towns of Sturminster Newton and Blandford Forum; the Stour valley villages of Durweston, Stourpaine, Hamoon, Iwerne Minster, Fontmell Magna and Sturminster Marshall; and other places such as Winterborne Stickland, Milborne St Andrew, Tarrant Hinton and Tarrant Gunville, to list only the worst affected places in my constituency. I apologise to constituents who are listening to this debate or who read it in Hansard if I have missed them out.
On Christmas day, I had to make a 5-mile detour to get to lunch with friends in the hamlet of Hamoon, because the River Stour had broken its banks and there was a foot and a half of water over the bridge. Even then, I had to drive through a main street that was awash with deep water to get to lunch. Hamoon is still cut off from the east. Milborne St Andrew remains a village divided by water, and the village shop is surrounded by a lake that should be Milton road.
I pay tribute not in the first instance to the public authorities and the water companies, which have often been slow to respond, but to the hundreds of volunteers who have rallied around to help their neighbours, in particular the volunteer flood wardens, the parish councillors and all the ordinary people who have done more than just complain about the misery that they have suffered for more than two months.
The storm system that struck the Dorset coast just over a fortnight ago rightly hit the national news because of its sheer ferocity, the extreme rainfall and the damage that it caused. Dorset county council is still receiving in the region of 1,000 public inquiries a week about the flooding, and it has identified more than 7,000 road defects and hundreds of affected properties.
What has not been so visible or of such intense media interest is the suffering of rural residents, such as the many people in my North Dorset constituency who have experienced prolonged flooding not just this year, but every year for the past three or four years. It is that increasingly frustrated minority whom I would like to speak up for today, as we debate the future management of flood risk. They are a minority who, as a result of the focus on more densely populated areas downstream, will continue to lose out unless we rebalance our policy focus.
The third report of the Environment, Food and Rural Affairs Committee, “Managing Flood Risk”, which was published last July, underscores the fact that
“The current model for allocating flood defence funding is biased towards protecting property, which means that funding is largely allocated to urban areas.”
Affected members of the local farming community will no doubt concur with the Committee’s view that
“Defra’s failure to protect rural areas poses a long term risk to the security of UK food production”.
Once again, the rural penalty rears its head.
There is little doubt that, whatever the root cause, the Environment Agency has significantly reduced its maintenance activity. Affected residents, local councillors and flood wardens in the worst hit areas of my constituency are unequivocal in saying that the Environment Agency is no longer clearing rivers and streams and, in some cases, is actively preventing farmers and local landowners from doing so on environmental grounds. To quote one senior councillor, the Environment Agency has
“failed on all their own priorities—people displaced, property ruined, water voles (presumably) drowned”.
I am aware that dredging is not a suitable course of action in every instance. However, in my view, there should not be institutional resistance to such action if, in specific cases, it can lessen the damaging impact of the kind of excessive and prolonged floodwaters that some communities in North Dorset have been experiencing year on year.
Regrettably, villagers who have experienced repeat flooding say that they have been “patted on the head” and told that “nothing can be done”. Frustrated local flood wardens tell of battling against multiple agencies that pass the buck among themselves or veto works that contradict their particular beliefs, and that act only when homes are seriously flooded and not before.
It has taken one flood warden in my constituency nearly seven years to persuade the Environment Agency and the local highways teams that repeat flooding in his village could be better managed if they would just take a look down the drains. When several visits from me and the local media finally convinced them to do that, it quickly became apparent that lack of maintenance had rendered the village drainage system totally defunct. Suddenly, three heavy-duty pumps, which had previously been unavailable, appeared to clear the water, and a commitment to improve the system was secured from Dorset county council, which is the local highways authority. By that time, the village’s main access road had been under water for some seven weeks. The local GP surgery had been forced to close temporarily, and the only village shop estimated that it had lost a devastating £20,000 in turnover.
I share my constituents’ views and experiences here today not to lay blame, but to make three simple points. First, those responsible for flood management do not always listen to the people who know their area the best. As a result, faster and perhaps more cost-effective mitigating action is not always considered. Secondly, conservation should not be prioritised over people’s homes and livelihoods. Thirdly, when multiple agencies are responsible for flood management, they must work effectively together for the good of local communities and with local communities, not behind closed doors.
When communities are, understandably, losing faith, good communication and transparency are vital. The weather this winter has certainly been extraordinary, but a modern civilised society should be prepared. I hope that the Government will learn from the misery my constituents have suffered this winter, and react quickly and favourably to Dorset’s imminent Bellwin scheme claim.
Mr Brian Binley (Northampton South) (Con)
This is an important and topical debate, and I congratulate many of those who have gone before me on their valuable contributions. It has been an excellent debate and many lessons can be learned. I pay a special tribute to my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) who, with waders to the fore, charged through the floods of the Somerset levels, leading the opposition as though he were fighting off the Spaniards. His example highlighted the difficulties felt by many people affected by flooding. He was their voice for some time and we must take note of that.
The news agenda will now move on from the recent flooding misery in Somerset, parts of the Thames valley and our coastal regions, but for those who were directly affected, the impact will take months if not years to come to a conclusion. Our instinctive reaction is rightly to sympathise with those whose lives have been disrupted, but the frequency of flooding events in different parts of the country and the impact on the lives of individual communities leads me to the conclusion that we need a far more radical approach to both our planning and our response. We must learn the lessons and we must listen to local people.
I cite my town as an example. In 1998, Northampton was inundated with major flooding over the Easter period when a stationary band of rain caused extensive flooding in the midlands from Worcestershire to the Wash. The water levels affecting the area, including Northampton, were recorded by the Met Office as higher than the 1947 floods, which were designated the benchmark for inland flooding in this country. Of more than 4,000 properties affected by the flooding, nearly 2,500 were in Northampton. Two people died, thousands had to leave their homes, electricity supplies were lost, and cars, boats and caravan parks were damaged. Falling as it did on a holiday weekend, the disruption was exacerbated. It has been estimated that the cost of that flooding incident was as high as £350 million, and 70% of those flooded did not have insurance for their homes.
The impact of the flooding was devastating. As a local council, we were determined not only to learn the lessons but to do what was necessary to minimise the risk of future flooding. An independent review described the lessons in terms of floodplain management, forecasting, and investment in flood defences and warning systems and—this is a vital point—their maintenance. Thanks to sizeable pressure exerted by the Northampton flood alleviation group, among others, flood defences were upgraded to a one-in-200-years standard of protection. A £7 million package of works included reinforcement and construction of flood walls and earth embankments, and channel improvements included dredging and widening.
There is important evidence to suggest that in the absence of that approach we would have been affected almost as badly in November 2012, when water levels in the River Nene threatened a further incident. Indeed, the Environment Agency acknowledged the effect of our response, with a spokesman observing that
“flood defence improvements built after 1998 have helped protect several communities from flooding...all of our plans and flood defences have worked, protecting many hundreds of homes.”
That happened because of local pressure. I implore the Minister to understand that lesson, to listen to the people who have been talking to him today, and to put his trust in people in local communities. All too often, the Environment Agency has taken an overall national view without listening to the local voice. I beg the Minister not to do likewise. I know that he has experienced these things himself, so I am hopeful that he will take notice of the need for such an approach.
In 1998 there were no warnings, and allegations were made that flood defences were operated so as to sacrifice some towns for the protection of others. The then Minister acknowledged in this House that
“there were instances of unsatisfactory planning, inadequate warnings for the public, incomplete defences and poor co-ordination with emergency services.”—[Official Report, 20 October 1998; Vol. 317, c. 1080.]
How often have we heard that in today’s debate? In those respects, nothing of any great consequence has happened since 1998. I am not saying that flood defences have not improved—they have—but little has happened in those respects, and that is because we have not listened to people in the localities.
We know that there are 300,000 more homes on floodplains today than there were 30 years ago. We have built 300,000 homes on floodplains in the past 30 years, and then we wonder what causes the sorts of impacts we have seen recently. We should not wonder. We should take a firmer grip of planning and of architectural design, because many of the houses that were flooded could have avoided that catastrophe had we taken that approach.
I urge the Minister to take note: we cannot expect to eliminate the risk of flooding, but our response in Northampton has proved effective in preventing some sizeable potential flood incidents since 1998. That has happened because we had a local group fighting constantly to ensure that flood protection was high on our agenda. Once the sympathy and immediate response to the flooding in Somerset and the parts of the Thames valley and the coastal regions most recently affected calms down, those residents will, rightly, be asking the self-same questions. The answer will be judged on the quality of the responses, and it will be judged to be satisfactory only if the views of people in the locality are taken into account.
Mr Graham Stuart (Beverley and Holderness) (Con)
It is a pleasure to take part in this debate, which, as my hon. Friend the Member for Northampton South (Mr Binley) said, has been distinguished by many fine speeches covering a wide range of policies relevant to the subject in hand. One of the largest, all-encompassing issues—climate change—has been touched on, and in my exchange with the Green party member the hon. Member for Brighton, Pavilion (Caroline Lucas) I spoke about getting the language right, which is important. I declare an interest as chair of GLOBE International, and refer the House to my entry in the Register of Members’ Financial Interests. Last week in Washington, GLOBE International held a climate legislation summit in the US Senate. The Royal Society and the National Academy of Sciences gave a presentation, which coincided with the launch of their new booklet setting out the state of the science—truly chilling information.
I am not a scientist and have always remained sceptical when dealing with climate change and trying to come up with the most rational—I hope—response, and my hon. Friend the Member for Reigate (Mr Blunt) said that this is about acting in the most rational and sensible way with our information and limited finances. Unlike some who would cast Lord Lawson into outer darkness for daring to question any of the orthodoxies, I do not think that is the right way to go. We need an inclusive debate in which we assess the science, taking it with an appropriate pinch of salt as we in this place learn to do with all expert opinion. However, the mounting, growing, consistency of information makes it hard not to accept that the emissions we create in our industrialised societies are contributing—and, more importantly, will contribute —to greater warming of the planet.
We are trying to work out what that means and its implications, but scientists would say that they do not understand it all. Perhaps even more complicated than understanding which areas will be colder, wetter or warmer as a result, is working out the best response to that threat, and that is the fundamental context for this debate on managing flood risk. All scientists—certainly those I have seen—seem to agree that greater energy is coming to the Earth, which will lead to greater levels of precipitation. In some areas there will be intensified drought, and in others intensified rainfall. In that context we must think not only about our response to the current environment—whether or not that is immediately driven by climate change—but about the long term.
I, too, pay tribute to my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger). One challenge with flooding is that when it is a hot topic, it is a hot topic. Leaders of the day make lots of promises, but there then tends to be a fading away; a salami slicing of budgets. That is why I asked my hon. Friend the Member for Newbury (Richard Benyon)—quite rightly a highly regarded former Minister—what framework we might need to put in place to deal with that.
Holland has statutory standards. I may get some of my facts wrong, which will doubtless be pointed out, but my understanding is that the Dutch have tried to look at the evidence, drawn a line, and worked out the areas they cannot afford to defend because they are indefensible or so costly that it is unreasonable. Behind that line they have statutory standards and flood boards with much wider tax bases, who are elected—admittedly sometimes with derisory turnouts—to put in place and, as various hon. Friends have said, to maintain the defences, so that that standard is delivered. The Dutch would say that that is far from perfect, but it provides a framework in which people can have some confidence that even if there are no floods for a few years, things will not fall into a state of neglect.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Mr Parish, you have got away with it once. I am not going to let it go twice.
Mr Stuart
I would like to say a few words on how my constituency has been affected. It was devastated in the 2007 floods. The impact on homes and businesses was far greater than it has been in the current floods, but, as others have said, flooding is devastating for every home and business. About 1,100 homes and businesses were flooded by the tidal surge in December that affected people around the Humber estuary. Whatever the cause, flooding has a tremendously strong effect.
I would like to praise the work of internal drainage boards in my area. The south Holderness internal drainage board undertook work to dredge Hedon Haven. Dredging needs to be done in the appropriate way and in the appropriate place—I can imagine dredging having a detrimental effect in the valleys mentioned by the hon. Member for Rhondda (Chris Bryant). The incredibly flat area of Holderness is effectively a man-made ecosystem. It is hard to see improved dredging, which would allow very slow-moving water to get out, leading to anything other than an improvement. It will not stop one-in-200-year flooding events having a negative effect, but it will make them last slightly less long with a less wide impact. Dredging also appeals to local people, who like to feel that those bits of the system that drain water away are kept in a state of usefulness.
One point I would like to make to the Minister is that when the Keyingham internal drainage board in my constituency was looking to carry out dredging at Stone Creek and Hedon Haven, the new Marine Management Organisation decided to charge it for a licence. We spent years pulling all the pools and the political will together to get the sign off to allow us to dredge and let the water out, but what happened? This glorified new quango came along and sent in a suggested bill for thousands of pounds to grant a licence, even though the Environment Agency, when it had done similar work elsewhere, had not charged anything. The MMO decided that it had to do so much more work it ended up charging £10,000 for that one bit of dredging. Will the Minister please ensure that quangos do not inflict charges that stop local people doing what is necessary to make sure that things are more sensibly managed?
After 2007, there was a good response from people who had, up until that point, not performed as well as they should; whether that was Yorkshire Water, the Environment Agency or the council. In our area, people did not know who owned the pumps, let alone whether they were responsible for keeping them going, but since 2007 they have worked together. In front of Willow Grove in Beverley, Yorkshire Water has done a great deal of work, and the local council then came in and worked closely with local residents. In 2007, a very beautiful row of houses was famously pictured all flooded. The picture went out around the world. A flood wall has now been erected in front of those homes, trees have been planted and the Westwood area has been restored. Local ownership really can work and we need to ensure we keep it that way.
We need to ensure that we have as broad an understanding as possible of catchments and their impact. That is why all the agencies involved—the hon. Member for Kingston upon Hull East (Karl Turner) who is in his place, Members of the European Parliament, Hull city council, East Riding council—supported setting up the River Hull Advisory Board, which I chair. The Environment Agency and others have supported finding the funding to try to have better modelling of the River Hull catchment, so that we can ensure the effective protection of agricultural land—which deserves consideration—rural areas and the urban areas in Hull. The truth is that we are all in it together and we need to ensure that we have a coherent and cohesive approach that works. I pay tribute to all the agencies that have worked together on the River Hull Advisory Board. We really are taking forward a better understanding and a better policy for the future.
Andrew Percy
My hon. Friend is entirely right about the need for catchment plans, but is there not a fear that, such as with the River Aire catchment plan in my constituency, funding will be factored towards the urban areas because of the formula? There is a perception that the River Aire plan is all about protecting Leeds and not protecting those of us a bit further down the river.
Mr Stuart
That is a good point. As my hon. Friend might imagine, one of my purposes as chairman of the body I mentioned is to ensure that, rather than policy being skewed in favour of the rural and against the urban, we do not bind ourselves within policy frameworks to such an extent that we cannot make recommendations to the Government. I do not wish to prejudge the position, but I hope to be able to make common-sense recommendations that will enable the representatives of the city of Hull and the East Riding to speak with one voice, and suggest changes to the framework that will facilitate the adoption of an approach that is as reasonable and joined-up as possible. I recognise that finances are limited, but we need to ensure that no one, in the city or in the countryside, is unfairly deprived of the support that should rightfully be theirs.
Finally, let me congratulate the Government, from the Prime Minister down. I think they have shown that they are committed to dealing with this issue. I mentioned the framework because I want that commitment to continue long after the issue—along with the water—has, we hope, drained away. The Government have introduced a series of measures that have already been mentioned, providing not only grants but funds to help businesses that have been flooded, such as those in the constituencies of the hon. Members for Kingston upon Hull East and for Kingston upon Hull North (Diana Johnson).
One thing we must do is cut through the bureaucracy. Perhaps the Minister can help with that. For instance, a small business person in my constituency who owns a pub in Hull contacted the city council when it was flooded. He said “I was delighted to hear on the news that the Government can help me to get through this. I am paying my staff at the moment, because I do not want to lose them and I must look after them, but my pub is taking no money.” He was told “We have not got any forms yet.” “So I cannot apply for help?” “No. We have not got any forms yet.” That kind of nonsense must end. We must ensure that whichever council or other authority is involved can move quickly, because there is nothing more frustrating than hearing people make promises on television, and then finding that the door is barred by some foolish bit of bureaucracy.
Caroline Nokes (Romsey and Southampton North) (Con)
The issue of managing flood risk has inevitably come to the fore in my constituency. Since 24 December, some properties have been flooded not only by river water but by foul sewage. Environment Agency records show that back in 2007, Romsey, along with Winchester, was identified as one of the areas in Hampshire that were most prone to flooding.
I want to touch on some specific issues, including development, which other Members have already mentioned. We should think about development not just on the floodplains, but in the catchment areas. We should think about the impact of building yet more houses on land that has previously acted as a natural sponge. We should think about the run-off caused by more tarmac and more roof tiles.
In my constituency, during the run-up to Christmas and into the new year, significant problems were caused by surface water run-off and combined drainage systems that simply could not cope with the amount of rainfall. Since then, however, the problems have been caused not by foul drainage but by the beautiful River Test, which has burst its banks in several places, and by its carriers and tributaries. That has had an impact in many parts of my constituency, not just in Romsey.
I agree with other Members who have said that we need a coherent strategy. We cannot view Romsey in isolation from the villages further north along the river valley, because any work that is done further north will have an impact on Romsey. In the villages, I have heard many calls for dredging, for a widening of the streams and watercourses, and for better weed clearance. However, that could have the effect of sending water down to Romsey and the River Test even faster. We know that the Test has a maximum capacity of about 50 tonnes of water per second, but according to some figures it has run at 55 tonnes per second over the past few weeks. It does not take a rocket scientist to work out what will happen next: the river will flood. We need a coherent strategy that will establish ways of slowing the river down as it passes down the beautiful Test valley.
I am not an engineer and I do not pretend to have the solutions, but I think that we can work something out. Just over a week ago, I was told by the Army that it was necessary to find bits of land that could be flooded safely without affecting people’s homes and without necessarily affecting sites of special scientific interest, in a manner designed by the Environment Agency. The water needs to be slowed somewhat, so that when it arrives at Romsey—where all of it has to pass under one bridge at Mainstone—there is not a deluge but a controlled flow.
It is vital for us to use the knowledge we have gained over the past month or so. The help from the military has been invaluable, but I also pay tribute to the Environment Agency, many of whose staff have been working 24/7, literally around the clock, putting in more than 80 hours per week just to ensure that homes are kept safe and people are not flooded out. We have learnt a great deal. Aerial photographs taken in my constituency show exactly where the Test has flooded. A massive amount of work has also been done on a little-known river, the Fishlake stream. I do not think that anyone knew quite how fragile the bank of that stream was until the Friday at the beginning of February when the water started to overtop the bank and erode the outside of it. Suddenly, it became a crisis point. I do not believe that the Environment Agency identified it as such back in 2007, but we have learnt this time. We have had thousands of man hours of assistance—engineers have tried to establish the best way of preserving and protecting the bank for the future—and we have had critical lessons to learn.
I should pay tribute to a host of organisations in addition to the Environment Agency, particularly the emergency services, but also the Houghton fishing club, a wonderful riparian owner in the north of the constituency. Its members were out digging relief channels and making sure that houses in Stockbridge were protected during the critical first weekend of the flooding. There has been flooding in Stockbridge, but it has been limited to three houses. Stockbridge is a beautiful village on the banks of the Test, and many carriers run under the high street. It is phenomenal that only three houses were flooded; the situation could have been much worse had it not been for the immediate response of the fishing club, which, as an organisation that has existed for many years, knows the river better than almost any other. It was able to identify what could safely be done to create relief for the properties on the banks of some of the carriers that were in the most peril, without endangering further houses.
I also pay tribute to all those who have been involved in the multi-agency approach, and to the independent companies that have made fantastic offers of help with the flood effort. I am thinking particularly of NGS, a company in Southampton that is best known for supplying grit and salt for roads in icy weather. It donated sand for sandbags at a critical time, just as Romsey had established that an additional 40,000 sandbags were needed. I gather that about 80,000 sandbags have now been laid down in the affected part of the borough, thanks to a phenomenal effort. Travelling around the constituency over the weekend, I saw areas where the provision of sandbags was still essential.
On the banks of the Test, the groundwater-fed river is causing a considerable problem. Water levels are still rising, and groundwater springs are still popping up in places where they have never appeared in the past. The village of King’s Somborne, for example, has a wonderful stream passing through it, but that stream is overflowing into many houses across roads, and has made it incredibly difficult for people to get out just in order to buy essentials. Many businesses such as village pubs and shops, which are critical to village life, are unable to trade, having found themselves under several inches or even feet of water.
I echo the call made by my hon. Friend the Member for Beverley and Holderness (Mr Stuart). Businesses need to know how to apply for funds: they need the forms. I know that Test Valley borough council has done great work in putting information on its website, but when the applications are made, it will be imperative for funds to arrive, and to arrive quickly.
Mr Robin Walker (Worcester) (Con)
My hon. Friend is making an excellent speech. Does she agree that, as well as the businesses that she has mentioned—which, of course, need all the help we can give them—there are businesses that have been cut off and very badly affected by flooding, although they may not have had floodwater inside their premises? I welcome the £10 million that the Government have already set aside to help those businesses, but does my hon. Friend agree that even more may be needed?
Caroline Nokes
My hon. Friend is absolutely right. There is an industrial estate in Budds lane in my constituency. Budds lane was horrendously flooded. The emergency services had to shut the Greatbridge road because of the depth of water, yet some businesses in the industrial estate were dry. There was no access to them, however, so there was no passing trade, and they could not get their staff into work, but the business itself was not affected by floodwater.
I want to conclude with a plea. Almost inevitably, it comes from the lead flood authority, Hampshire flood authority, and it refers specifically to the flood defence grant in aid. The deadline for the submission to Government is incredibly tight. It was moved from 3 March out to 12 March, but that is only next week, and there are concerns that what will happen as a result is that the most developed and worked-up schemes will be submitted, which might not necessarily be the schemes that would best protect the villages in my constituency or Romsey itself. That is a very real concern, because what we have learned over the past three and a half weeks is where the crisis points are. We perhaps did not know in detail where they were previously, but we do now. It is absolutely critical that the areas which need the help most, in that they need the most investment to prevent future flooding, are the ones that get it. We need to have not simply the schemes that are furthest down the pipeline, but the ones that address where there is the biggest point of crisis.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Dan Rogerson)
indicated assent.
Caroline Nokes
I see the Minister nodding, and I hope he will heed that well, because there is a significant concern in the county council that that might not be the case and that the 12 March deadline is incredibly tight. We in Hampshire have had a significant problem not just with river flooding, but with ground water; as we are a county that is rich in chalk, we inevitably get a lot of groundwater springs. There is surface water run-off which has caused massive problems in my constituency and elsewhere in the county and, of course, we have had problems with foul drainage.
I have in my inbox numerous e-mails from constituents who have been suffering flooding since 24 December—Christmas eve. I would like the Minister to contemplate for one moment what it must be like to be flooded out of one’s house by sewage on Christmas eve, and to be looking at the repairs and considering the future when, in February, the River Test rushes in and undoes all the drying that has occurred up until that point. I have many residents who find themselves in that situation. They are unsurprisingly desperate. They are deeply concerned and unhappy. They are lacking in confidence about whether they will ever be able to reinsure their homes. They welcome the Government’s Flood Re scheme, but in a beautiful river valley such as the one we have in Hampshire many of the properties are inevitably in the highest council tax band and many of them are damaged beyond repair and facing potential demolition and rebuild, and their residents want some answers on whether they will be able to be covered by Flood Re if technically the house is a replacement and a new building, not one that has just been repaired.
I would welcome any answers the Minister is able to give on that front and I appreciate having had this opportunity to speak once more about the flooding in Hampshire, which, sadly, has not attracted the same coverage as the flooding in Somerset or the Thames valley.
Damian Collins (Folkestone and Hythe) (Con)
Like all Members in this debate, I would like to set out some observations and lessons that I believe can be drawn from the winter flooding, but before I do that I would like to add my thanks to the local Environment Agency team, particularly Andrew Pearce, who heads it, and Ian Nunn, whom I have met and corresponded with over recent weeks. Regardless of Members’ views on how well the agency strategically dealt with some of the issues it faced, there is no doubt that it is full of a lot of extremely hard-working people who have worked long hours and given up their weekends and holidays over the winter to try to help the communities they serve, and they deserve to be congratulated and thanked for that work.
Of the constituencies with the highest flood risks in the country, mine ranks in the top 10, and that is principally because of the risk of coastal flooding to the Romney marshes, a stretch of land that is not unlike the Somerset levels in that it has many areas which are at or below sea level, and it needs to be defended and maintained all the time from the risk of flooding both from rainwater falling on to the marsh directly and from the coast.
We have been protected this winter from major coastal flooding by the coastal storms because of the large investment by the EA in the coastal defences, particularly the sea wall at Dymchurch, and I was pleased to hear that in the new spending round the EA will be investing in the beach defences at Littlestone. I was also pleased to see how quickly it responded after the winter storms to replace the shingle defences along the Hythe bay coast.
Many Members have talked about the importance of local partnerships in dealing with flood risk. I would like to highlight the work of the Defend Our Coast organisation that both myself and my hon. Friend the Member for Hastings and Rye (Amber Rudd) have worked with over the last four years. It helped to co-ordinate the response from the local authorities, the local community and the EA so as to understand where the risks were, and I know my hon. Friend the Member for Newbury (Richard Benyon) met Defend Our Coast when he was a Minister and can vouch for what a fine organisation it is. However, the risk this year has not come from flooding from the sea. Instead it has come from the potential of flooding on the marsh and in the Elham valley from the River Nailbourne.
There are some simple lessons that can be drawn from the experience of this winter, particularly on Romney marsh. There is no mystery to keeping the Romney marsh from flooding. It has been designed to manage large amounts of water. To keep the water moving, there need to be pumps when the water gets too high and ditches need to be clear to push the water out, ultimately into the sea, through the main drainage canals.
There are a few very important areas of work that have to be done well and consistently in order to make that happen. First, the drainage ditches must be kept clear, especially of the build-up of reeds. That needs to be done methodically and all the time. It does not require the ditches to be dredged. The regular cutting of reeds serves to remove silt and keeps the waterways moving.
This work is done by two bodies: the Romney marsh internal drainage board and the EA, with the agency taking responsibility for the larger watercourses. I would pose the question, however, as to whether we should have one body that deals with all this work in a co-ordinated fashion, and whether it would be better for the local internal drainage board to take over the responsibility for all the cutting on the marsh, thereby recouping some of the money it pays to the EA to do that work for it. Sometimes the drainage board will cut smaller ditches that run up to the larger ones and then stop because that then becomes the responsibility of a different agency. It seems to me that it would be more efficient to have one body that is responsible for this work.
The other important area is pumping. All Members have talked about the need to pump water. When there is a build-up of water on flat land, we need to get it off and get it moving. The EA has done a fantastic job in getting pumps installed to keep water moving on Romney marsh. It has installed 15 pumps during the course of the winter flooding. On one occasion I had a meeting with the agency and the internal drainage board on a Friday afternoon to see what more we could do to get more pumps in place to relieve the pressure on residents in Lydd, and most pumps were in place on the Monday. They were therefore very responsive.
One reason why we needed the additional pumps, however, was that some of the older pumps in place on the marsh had stopped working. Maintenance is important. There will need to be substantial capital investment at some point in the near future in some of the older pumps. This investment will save money because the need to bring on relief pumps at short notice often costs more than maintaining the ones we have. We will have to consider where the extra capital investment will come from for the pumping equipment on the marsh. Having efficient pumps working well and the ditches kept clear is a cost-effective and efficient way of ensuring the water gets off and away as quickly asit needs to.
Co-ordination between different services is another issue. People have spoken about the need for co-ordination between the EA, the emergency services and local councils, and I would also include organisations such as UK Power Networks. We have had incidents where, because of storms, there has been a power outage, and therefore power that was being supplied to one of the pumps has gone down, yet when the EA sought to take that up with UK Power Networks, as the responsible body, it might as well have been calling a call centre. There did not seem to be a fast-track response mechanism whereby the EA could speak immediately to someone at UK Power Networks who could tackle the problem. That led to too long a period of time before action could be taken to get the pumps working again or before going to the extra expense of relief pumps being brought in because some of the main pumps had failed. How we build resilience into the network by having better co-ordination between UK Power Networks and the EA is a very important question.
There must also be greater clarity about the roles of the local authorities and the EA, and sometimes also the Highways Agency when there is flooding on roads or water running off roads because the drains and ditches have not been maintained properly. It must be clear who is responsible. Constituents of mine in East Brabourne were affected. They dealt with the situation directly themselves by paying for the relief measures that needed to be put in place. The question of who is responsible for this work needs to be addressed, however. Who should be doing this work on a regular basis? When there is a crisis, do residents know who are the first people to go to? I do not think it is clear, and sometimes this basic maintenance work falls down because of a breakdown in communication between different local agencies. That is relatively easy to fix.
There is no doubt that we have had a huge amount of rain. One resident I met in East Brabourne, Oliver Trowell, has lived in his house for more than 80 years and he had never seen flooding like it—I hope he does not see it again. Residents in the Elham valley, where I live, say that the level of water in the River Nailbourne is such that it may be decades before we see the same level again, but we are having to deal with it. We need to build in elements of stronger local resilience, ensure that the maintenance work is done and consider how the capital investment in some of the basic pumping equipment can be put in place over the next few years to ensure that when the next big winter flood comes we have all the local defences we need in place, the resilience built in and good co-ordination between the emergency services. That is the best way to make sure that the money the Environment Agency is investing in tackling flooding is having the best possible impact and providing the maximum possible benefit to local communities. That is the best way to plan for the future risk of flooding, which we know will inevitably come.
Dr Sarah Wollaston (Totnes) (Con)
It is a pleasure to follow my hon. Friend the Member for Folkestone and Hythe (Damian Collins), with whose comments about the need for co-ordination and communication I completely agree. I, too, represent a beautiful coastal constituency—south Devon has taken a terrible battering but it is still beautiful and it is still open for business, and I hope that Members will come to visit us.
I wish to address three points, including the underlying causes and the need to build resilience in our coastal defences—I wish today to concentrate on coastal flooding. First, however, I ask the Minister to listen to the desperate plight of fishermen in my constituency, 21 of whom have written to me in the past fortnight. The situation for them, particularly the crab fishermen, is desperate. A crabbing pot costs £60 to replace and a shrimping pot costs £40—that is before the extra costs of materials such as rope are added on. Most of the 21 fishermen who have written to me—there are many more fishermen in this position—have lost about 100 pots, but some have lost 300 pots. They are looking at having to pay between £6,000 and £18,000. We also need to take into account the desperate conditions they have faced over the past few months. Some have been able to get out on only two or three occasions, and even then they have been having to try to retrieve gear.
That desperate situation is faced by many fishermen, and I would love to read out each and every one of their letters. However, what I shall do instead is ask the Minister to meet me—I have written to the Department—to see whether we could consider having the same scheme for them as has been put in place for farmers. I welcome the farming recovery fund that the Department has set up jointly with an EU funding mechanism, because several funding mechanisms are now in place for farmers: support with business rates, and the many capital replacement grants for those who have been flooded. However, they apply only to people who have been flooded and fishermen, who of course work in a flooded environment all the time, are dealing with a different issue—the damage from the storms—although one very much related to the issue we are debating. Farmers can access a fund of between £500 and £5,000. Will the Minister reassure fishermen that a similar fund will be set up for them? That would be enormously reassuring. As the lead Minister for co-ordinating on this matter, will he talk to the Department for Business, Innovation and Skills and his colleagues in the Department for Communities and Local Government about rolling out some of the grants that have been made available to farmers and make similar schemes available to fishermen? Many of the fishermen who have written to me face bankruptcy and will lose their businesses for ever, so there is an urgent need for action in the next month, not in three months’ time. I hope the Minister will address that in his response.
As the Minister will know, the other pressing issue for coastal constituencies in the south-west is the resilience of the rail line at Dawlish. As I have said, we are open for business; I would not want anyone to think that because the rail line is cut off, people cannot visit Devon and Cornwall—of course they can. However, the situation is having a huge impact on the region’s economy. I hope that he will address a concern that is mentioned in my constituency. Nobody wants Devon and Cornwall to be cut off every time there is heavy rainfall, and we welcome many of the measures that are being put in place to improve resilience north of Exeter, but resilience measures that bypass the line and take things via Okehampton would have catastrophic results for south Devon. That would not be building resilience; it would be building disaster. We are seeking a super-resilient line at Dawlish; perhaps there could be an alternative route to use in dire emergencies but not a replacement for that route. I hope the Minister will address that issue in his summing up.
I wish to discuss another issue facing some coastal communities in my constituencies by drawing on a couple of examples that illustrate a wider point affecting many constituencies around the country. I have spoken several times about the community of Beesands in my constituency, which I visited recently. The council spent £50,000 trying just a few weeks ago to put back the sea defences that had been washed away there, but they were washed away again with the first easterly and high tide. We do not want to put back what has just been washed away, because that is just throwing good money after bad. Beesands needs an improved sea defence. I praise the work of individuals such as Chris Brook who have gone to enormous trouble to source the rock armour from a quarry in Cornwall. It is all ready to go, the designs are in place to increase the height of the rock armour defences, but unfortunately we have hit a barrier—the need for planning permission. There is confusion because some parts of legislation appear to give councils the ability in an emergency situation to go ahead and put in place these sea defences, but elsewhere there seems to be a measure saying that planning permission is required for sea defences over 200 cubic metres. We cannot afford to delay, because the implications for Beesands of another high tide and a south-easterly are grave indeed. There is no point putting back exactly what has just been washed away, so I hope that the Minister, in his role of co-ordinating things, will try to sweep away some of these bureaucratic barriers, because everyone knows what needs to be put in place and we just need to get it going.
I also hope that the Minister will work with councils, because we would like military support for the lift-in. Anyone who has visited Beesands will know that access to it is incredibly narrow, down a very steep hill, and we may need at least 450 lorry loads. Military assistance, as was put in place for the original delivery of the rock armour, would expedite this delivery and allow us to get the sea defences in place at this critical time. I hope that he will examine this wider point of urgency and, as my hon. Friend the Member for Folkestone and Hythe said, the need for agencies to work together to try to sweep away some of the barriers and just get the work done—that is vital.
I will not say that Beesands is fortunate, because it is in a difficult position, but in some ways the neighbouring community in North Hallsands is in a much worse situation. Even though it is only a short distance down the coast, the shoreline management plan designates it for no active intervention, which has left the local community feeling as if they have been abandoned and people are just walking away. The road access to this community has been cut off and they are currently having to take a detour around a private car park. The trouble for this community is that Devon county council will say, “We only own the road surface.” The council has sort of walked away, and so the villagers are left with rock armour scattered all over the place, there is no access for the local fishing community and the place feels as if it has been abandoned. Will the Minister examine the impact that shoreline management plans have, because I understand that there are some powers to have flexibility in this area and there is no way this tiny local community could afford to rebuild its sea defences on its own?
This is such a sensitive issue because the community at North Hallsands needs only to look a very short distance down the cliff to see what happened to the original community of Hallsands. Anyone who knows south Devon will know that in 1897 an extraction licence was granted to Sir John Jackson, 650,000 tonnes of shingle were then removed from off the coast of the village, the shingle beach dropped dramatically and the village was swept away, with only a few ruined dwellings left behind—a population of 159 lost their homes completely. There is great local sensitivity about this issue within the community of North Hallsands, some of whom are descendants of those original habitants of Hallsands. I hope that the Minister will look sympathetically at trying to get them access along their road, or even some help so that they can have assistance in overcoming the complications, and at reviewing the shoreline management plan, which has left them feeling abandoned.
Another issue is that of the Slapton line. The shoreline management plan there is one of managed retreat, which will have terrible consequences for the economy of my constituency. It is an essential communication route between its two halves. To negotiate the alternative route down back lanes requires someone to be exceptionally good at reversing very long distances at speed. It is simply completely inadequate. I call on the Minister to review the shoreline management plan for the whole area to give us some real hope for the future.
Finally, the village of Hallsands stands as a testament to what happens if we ignore man-made impact on climate change. I hope that the Minister will consider climate change in itself—I know he feels strongly about it—because we ignore that at our peril. It is not just that the jet stream has settled over southern England but the fact that it is 30% stronger. If we ignore the problem of emissions, this sort of flooding will not be an exceptional weather event but the new normal.
Barry Gardiner (Brent North) (Lab)
What a serious and well-informed debate this is, and what a serious and well-informed speech the hon. Member for Totnes (Dr Wollaston) has just made. This has been an excellent debate and I pay tribute to many Members for their contributions, including the hon. Member for Brighton, Pavilion (Caroline Lucas).
I echo the remarks made by the hon. Member for Totnes about fishermen and the fishing communities. She made a very important point. We often think about farming communities and businesses, but overlook what is happening in the fishing communities. That point was also made in the good debate that we had in Westminster Hall on Wednesday morning, but it was good that the hon. Lady made it again here today.
The hon. Member for Newbury (Richard Benyon) made some excellent points about land management and, as is his wont, spoke powerfully about dredging. I also pay tribute to the hon. Member for Beverley and Holderness (Mr Stuart) who spoke powerfully about climate change and the recent report, the launch of which he had attended.
It is a rare occasion indeed when one can know with certainty in advance of a debate in this Chamber that there will be absolute unity among all three parties and that the Minister and the shadow Minister will agree with the Chair of the Select Committee and each other about matters under discussion. Today we have what may in other circumstances be called a prenuptial agreement. Before the Minister—and indeed his colleague, the Under-Secretary of State for Environment, Food and Rural Affairs, the hon. Member for Camborne and Redruth (George Eustice)—and I were appointed to our current roles, we sat under the watchful eye of the hon. Member for Thirsk and Malton (Miss McIntosh) who introduced this debate most excellently as Chair of the Select Committee. It is the report of that Select Committee that we all discussed, agreed and signed up to.
The question is whether Ministers have effectively translated the views and recommendations of the Select Committee, which we know they believed and accepted before they submitted to the yolk of ministerial office, into effective departmental policy. Have they followed through on what they actually think and have they done what they said was needed? Well, they have not. Here is what the Ministers both know and believe, as set out in the Select Committee report:
“Funding has not kept pace in recent years with an increased risk of flooding from more frequent severe weather events, and the relatively modest additional sums to be provided up to 2020 will not be sufficient to plug the funding gap.”
They signed up to that in the light of the disastrous decision to cut the flood defence budget in 2010. The Labour Government had left a budget of £670 million. After the election, the coalition partners agreed to reduce that current 2010-11 budget to just £573 million.
Barry Gardiner
I pay tribute to the hon. Gentleman for his remarks, because he speaks from personal experience. None the less, the Prime Minister is saying now that money is no object. Many people who have been affected by the floods may feel that it would have been better to say that that money should have been spent not on clearing up the mess but on preventing the flooding from being so devastating in the first place by ensuring that the defences were in place.
Mr Blunt
The point is that it is pretty remarkable that the Government, faced with the financial circumstances of 2010, managed to sustain capital expenditure on flood defences. Having experienced the pressures inside Government, and seen what was being demanded of other Departments, I think that that was a fairly remarkable achievement.
Barry Gardiner
I have to say to the hon. Gentleman that the figures belie that. In 2011-12, there was a budget of £573 million; in 2012-13, £576 million; and in 2013-14, £577 million. The budget for 2014-15 is £615 million. Over the four-year spending period, the Government have allocated just £2.34 billion to flood defences, compared with £2.37 billion over the previous spending period. Those figures are not the ones that the Prime Minister used two weeks ago at Prime Minister’s questions, but they are the ones set out clearly by the independent Committee on Climate Change in its policy note on 21 January, used by the House of Commons Library in its briefing on flood defence spending and set out by the UK Statistics Authority just six days ago. They can even be corroborated on the website of the Department for Environment, Food and Rural Affairs in the correction it had to put out after the Secretary of State and the Prime Minister both “mis-spoke”. As the UK Statistics Authority reported last week, the flood defence budget has seen a real-terms cut of £247 million in this spending period. The Committee was absolutely clear about the risk from the reduction of flood defence funds. Last October, in their official response to the report, the Government said:
“In the context of the wider need to pay down the deficit, we believe this is an excellent outcome and demonstrates the priority this Government attaches to managing flood risk.”
Well, yes, it certainly does.
Miss McIntosh
Is the hon. Gentleman not falling into the trap that I referred to earlier? Successive Governments have been too focused on physical structures that may well fail and need to be repaired. We need to have a better balance between capital expenditure and the revenue maintenance expenditure and to look to sources of funding other than local or national Government.
Barry Gardiner
The hon. Lady will recall my own contributions to the report. I was very keen that we put far more reliance on green infrastructure, and I will come on to that a little later. She will know that the Committee’s report was absolutely clear about the importance of partnership funding. Of course she will recognise—I think she did remark on it in the House a few days ago—that the £148 million that the Government had originally included in their spending figures when Ministers mis-spoke on this issue has not in fact been produced. It was actually £67 million of partnership funding that has been produced, not the £148 million that they counted for the period.
Barry Gardiner
I am under pressure of time, so I will proceed.
Let us be clear: the Government need to do two things. They need to construct more flood defences that will bring more homes and properties into a lower risk of flooding, but they also need to maintain those new and existing flood defences in proper condition so that they continue to provide protection. Unhelpfully, the Government chose to categorise all major maintenance or repair work to existing flood defences as capital spend. Uniquely in the debate so far, the hon. Member for Thirsk and Malton alluded to that point.
I want to make two points in that connection. First, it is not sensible to increase the new build flood defences without a corresponding increase in the budget for major repairs. In the interests of transparency, the Government need to disaggregate the element of their capital spend budget that is for new defences and the part that is for the major repair and maintenance of assets. Secondly, as the Government have used the capital spend as a proxy for spending on flood defences, they might confuse people who think that they are building more defences when, in fact, because of climate change and storm damage, they are simply spending more on major repairs to existing defences. In other words, there may be no increase in the number of defences or, indeed, the number of properties and homes defended, just an ever-increasing capital repair bill to maintain them. The hon. Member for Brighton, Pavilion made that point earlier.
It is therefore important that we examine the fine detail of the EA’s budget in this respect. In a policy note of 21 January, the adaptation sub-committee of the Committee on Climate Change did precisely that. All its figures are based on real terms, according to 2010 prices. The capital is lower in every year of this Government than when they started with £360 million in 2010-11. The figure falls to £261 million in 2011-12 and to £269 million in 2012-13, before rising slightly to £294 million in 2013-14, and finally, at £344 million, falling £16 million short of where it started in 2014-15. As my hon. Friend the Member for Garston and Halewood (Maria Eagle) noted in her speech to the House last week, those spreadsheet figures translate into real projects. The loss of £274 million has resulted in 290 shovel-ready projects being cancelled and 996 being delayed.
Dan Rogerson
I am quite happy to respond to the hon. Gentleman on the generalities when I come to make my main remarks, but the specific number of schemes that he is referring to, which has been mentioned in, for example, articles in The Guardian newspaper, relate to medium-term projects that were in no way shovel-ready. They are schemes that are in the pipeline and that are being assessed. They are projects that will come forward for delivery when they are assessed as being at the stage when that can happen. That is not the same as saying that they are shovel-ready.
Barry Gardiner
I am sorry; the Minister is wrong on that point. The 290 projects that I referred to are those that were shovel-ready and scheduled within that four-year period; the 996 projects are the ones that were not. Significantly, 13 of those schemes were in the north-east Thames valley, where more than 350 homes have been flooded, and 67 of them were in the south-west, where 100 homes have been flooded.
My right hon. Friend the Leader of the Opposition made the further point at Prime Minister’s questions that the EA is planning to make 550 flood defence posts redundant. I specifically questioned the Minister in the Westminster Hall debate last week on whether those redundancies will go ahead. He was pressed for time in his summing up and was unable to explain how he considered that the EA could give people the sort of assistance that we have seen over the past two months and to which many hon. Members have paid tribute this afternoon, and I join them in doing so. How will the EA do that with 550 fewer staff? Today, I ask him to tell the House what roles the people in those posts currently perform. Are some of them the people who actually manage the flows of water in the waterways, by monitoring and operating the sluice gates, the weirs, the locks and the pumps? Do they include the people who survey and assess the condition of flood defences. Do they include the people who prepare the maintenance schedules for those defences? Do they include any of the people who have been helped with the clear-up operations? What is of enormous concern is that those skills and expertise might be lost with these redundancies, with the corresponding loss of service and safety to the public in the future.
Barry Gardiner
I am afraid that I cannot give way because I have to give the Minister time to respond. I have given way quite a lot.
Now the Government have set out their forward projects for capital, by saying that they will spend £370 million a year in 2015-16 and every year through to 2021. The Minister needs to be open with the House today about what percentage of that money in each year will be used for new build flood defences and what will be used for major capital repairs and maintenance. The Committee on Climate Change has been astute in analysing the figure of 165,000 properties that the Secretary of State told our Select Committee were “better protected” in the current spending period when he gave evidence to us last year. It warns that flood risk will actually reduce only for a proportion of the 165,000 properties. Many capital schemes are simply replacing or refurbishing existing defences on a like-for-like basis and to the same crest height. With climate change, many of those homes will be less well protected than when the defences were originally built. The defence may have been repaired, but the risk that it will be overtopped as a result of climate change has increased. Far too many homes and properties are still at risk because the defences that we have are less effective than they once were because of the increased frequency and severity of extreme weather.
As my right hon. Friend the shadow Chancellor pointed out in his op-ed for The Daily Telegraph just over a week ago:
“Investment in flood defences is now £500 million below what is needed and this risks £3 billion in avoidable flood damage”.
The point that he makes is as simple as it is clear:
“we need to make long term decisions now that can save money in the future”.
He has promised that our zero-based review of public spending must not only eliminate waste and inefficiencies but
“prioritise preventative spending that can save money in the long-term.”
That is the sort of commitment that people get when they have a Chancellor who understands the science of climate change, rather than one whose guru is the chief climate change denier in the other place.
As my right hon. Friend the Leader of the Opposition said on Wednesday last week, the assessment of how much to invest in flood defence depends significantly on an assessment of the risks posed by man-made climate change. If we are properly to protect the British people against the threat of flooding, we cannot have doubt and confusion within the Government on climate change. But doubt and confusion are what we have from the two Secretaries of State in charge of protecting our homes, infrastructure and industry. The Environment Secretary’s unscientific opinions on climate change and his refusal to be briefed by his chief scientist on the subject are a matter of public record, as is his decision to downgrade flood defence as a priority. The link is clear.
The confusion reached a new height last Wednesday when the Communities Secretary, given the opportunity to show some scientific understanding and rigour, chose instead to cite Lord Lawson. The noble Lord’s dangerous, unscientific opinions on climate science are well known and have no place in the Government, let alone in the answers from a Secretary of State with responsibility for flooding. The fact that the Prime Minister has refused to distance himself from those comments shows that the Government cannot be trusted to get this right. The Met Office has been very clear that such extreme weather events as we have seen are only likely to become more severe and more frequent.
Is the Environment Secretary still refusing to entertain a briefing from his chief scientist on climate science? Will the Minister at least put his own opinion on the record? Does he accept the climate change risk analysis prepared by his officials, which estimates that 1 million properties may be at serious risk of flooding by 2020? Up from the current figure of 370,000, that 1 million estimate includes 800,000 homes. If so, will he tell us whether his Department’s flood insurance proposal—Flood Re—takes account of those additional properties? The Committee on Climate Change adaptation sub-committee has warned that it does not.
The Minister will know that Lord Krebs, as chair of the adaptation sub-committee of the Committee on Climate Change, wrote to the Secretary of State in January and made it clear that the committee was available to the Department to ensure that sound science was the basis for all the Government’s long-term funding decisions on flood defences. Will the Secretary of State accept that offer?
I wish to identify one of the most fundamental recommendations made by the Select Committee in its excellent report. The Committee stated:
“We regret that the current regulatory framework does not permit innovative investment in natural flood defences by water companies and expect Ofwat’s next Price Review to rectify this.”
All too often, we reach for concrete and steel solutions to the problem of flooding instead of looking at soft, green infrastructural approaches. There are notable exceptions, and Wessex Water, for example, operates a catchment management system that pays landowners to manage the uplands in a benign way that retains water and purifies it, instead of allowing contaminated water in need of treatment to run swiftly down the catchment. Land management plays a vital role. The retention of flood water upstream through woodland and ground cover in the uplands is every bit as important as dredging in the lower levels of the catchment. Landowners always seek to dredge the river as it passes through their land. That is the quickest way to try to ensure that their own land is not flooded and the problem is passed downstream. This approach was contained in the Pitt review under recommendation 27. When will this most important element of flood risk management, adverted to in the Select Committee report, be implemented?
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Dan Rogerson)
I am delighted to close the debate, which has provided a good contribution to the ongoing discussions on flood and water management. As we have heard, we had a debate in Westminster Hall last week on the impact of extreme weather on the south-west, and there was a debate on an Opposition motion on the same day. Today, we have had an opportunity to look at the contribution of the Select Committee in its report and the Government response to that report last year.
As has been pointed out, I was a member of the Select Committee before becoming a Minister. I know at first hand the knowledge and effort that go into producing such reports, and I pay tribute to my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), who chairs the Select Committee and, indeed, all members of the Committee past and present, for the way in which they marshal the evidence and hold everyone in the Executive to account. I thank all Members who have participated in the debate for their contributions. As I said, this is a timely debate, and a number of points have been made that did not emerge in previous discussions.
Since the beginning of December, the UK has experienced a prolonged period of bad weather. In England and Wales, it was the wettest January since 1766, and for southern England, this is one of the most exceptional periods—if not the most exceptional period—for winter rainfall for at least 248 years. I reiterate how grateful we are for the response by the emergency services, the Environment Agency, Flood Forecasting Centre staff and the many local authorities that responded to the floods, together with individual volunteers, neighbours and community organisations that have made such a difference in the areas affected.
It is important to remember that, for those who have been flooded, the after-effects last long after the news cameras have moved on. In response to this extraordinary situation, the Government have pledged to help affected businesses, farmers and homeowners. To recap announcements that have been made, we have pledged a £5,000 repair and renew grant for all affected homeowners and businesses to ensure that flood resilience is built into any repair work.
Mr Jeremy Browne
I am extremely grateful to my hon. Friend for giving way so early in his speech. On compensation, I know that money is finite, but will the Government look at this in the broadest terms, and in the round? For example, a company in my constituency called Wood Flooring Engineered has incurred losses of up to £1 million, and pubs have lost a lot of passing trade because of road closures due to flooding. I do not think that anyone expects to recoup every pound, but I hope that the Government will look not just at those directly affected by flooding but at those indirectly affected as well.
Dan Rogerson
I can indeed clarify, as others have at the Dispatch Box, that the business support scheme, which is aimed at small and medium-sized enterprises in areas affected by the floods, will look at businesses that have been affected by the extreme weather, not just those that have been inundated directly. There is a fund for farmers who have suffered waterlogged fields to help restore those fields to farmable land as quickly as possible, along with £30 million for local authorities for road maintenance, which should help affected areas to recover.
We have to remember that, outside current events, flooding is disruptive to people’s lives in the long term, and planning and defending against flooding remain a long-term priority for DEFRA and for the Government as a whole. We are spending £2.4 billion over the four-year period between 2010 and 2014, compared with £2.2 billion in the previous four-year period. That means that we have investment plans to improve protection to at least 465,000 households by the end of the decade. Looking forward, we have made an unprecedented long-term six-year commitment to record levels of capital investment to improve defences: £370 million in 2015-16, and the same in real terms each year, rising to over £400 million in 2020-21.
Miss McIntosh
My hon. Friend is addressing the very point that the hon. Member for Brent North (Barry Gardiner) and I made, which goes to the heart of the argument. There have been delays from the Department, particularly in implementing sustainable drainage systems—that is not necessarily its fault—and the review of partnership funding has not yet reported. Will the Department look favourably at allowing more transfer from capital expenditure to revenue and maintenance expenditure, as the hon. Member for Brent North suggested? In the long term, there are opportunities for water companies and others such as insurance companies to contribute to both funding streams.
Dan Rogerson
The figures that I am setting out into the future are for capital spending, and we expect revenue amounts to be settled as budgets are introduced for each year. However, the points that the Chair of the Select Committee makes about seeking contributions from all those involved in water management are entirely valid. In her speech she spoke about water company investment in water management that goes beyond the “hardware” side of things and looks more at the softer side of managing water through land management solutions. Ofwat is considering what it does with totex—total expenditure. It is looking at expenditure across the piece, rather than just at capital—the sort of things that appear on balance sheets that, in the past, would have been the focus. I accept that many people want to change that, so the fact that Ofwat has allowed water companies to do more of that will be beneficial.
The right hon. Member for Exeter (Mr Bradshaw), who is not in the Chamber today, but who took part in the Westminster Hall debate, pointed out the involvement of South West Water, along with my Department, landowners and managers, in an initiative looking at how water can be retained on Exmoor, which has made a difference to the moor’s catchments. That is a good example of the sort of work that can take place. The Chair of the Select Committee often speaks about what is happening in her constituency with the “Slowing the Flow” project, which is working on land management solutions. She is absolutely right that we need to emphasise the economic importance of investment in flood defences and, indeed, in water management. If we can prevent flooding and take that blight away from land that could be developed successfully, that would make a big contribution. If we can avoid the impacts that hon. Members have discussed, we can make a huge difference to local economies.
Geoffrey Clifton-Brown
Will my hon. Friend address the points that I made in my speech about building on the floodplain and, where it is not his ministerial responsibility, undertake to have a discussion with his colleagues in the Department for Communities and Local Government to address the uncertain but doubtless growing liabilities in Flood Re and SUDS, so that we do not build up a bigger and bigger problem for ourselves in future?
Dan Rogerson
My hon. Friend made that point earlier, and a number of other Members referred to the planning process. The good news is that the advice that the Environment Agency gives is taken into account in the vast majority of circumstances. However, there may be examples where we could look at that. My right hon. Friend the Secretary of State for Communities and Local Government, who has discussed the response and recovery aspects of these flooding events at the Dispatch Box on a number of occasions, will have heard that cry, and the national planning policy framework, which the Government have set out, makes it clear that we should not build on floodplains. There are locations, such as those, as we have heard, in the Humber area and so on, where that means no development at all, and the guidance makes it clear that we should see more resistance and resilience built into existing properties. The hon. Member for Brighton, Pavilion (Caroline Lucas) made that point in response to an intervention.
Mr Graham Stuart
I am grateful to the Minister for giving way; he is being most generous. With regard to increasing an area’s resilience, how would the Government view any proposals to widen the levy area that supports internal drainage boards so as to increase the resource in local hands for improving resilience?
Dan Rogerson
Local authorities would no doubt take a view on that. We would need to look at what taxes and levies are being raised from an area in total, because we know that families are hard-pressed and we do not want to increase burdens. If that could be done within what is raised by local authorities, using the relationships they have with internal drainage boards, individual proposals could be considered. There are places in the country where the possibility of setting up new internal drainage boards is being examined. If we can overcome the barriers, I think that would be very helpful.
The hon. Friend the Member for Thirsk and Malton also talked about protecting rural land, which was mentioned in her Committee’s report. Some 95% of arable land in England is either outside areas at risk of flooding or benefits from at least a one-in-75-year standard of flood defence. In fact, the partnership approach that the Government have taken means that some schemes that would not otherwise have been funded are now coming forward, because local funding means that the grant in aid now makes a sufficient difference to take a project forward. With regard to the areas that have been protected, my hon. Friend the Member for Newbury (Richard Benyon), my predecessor as Minister, was right to give the figure of 1.3 million properties. Great areas of agricultural land have also been protected by many of those defences, so it is not a case of setting one benefit against another; obviously we seek schemes that will do both.
On the Bellwin scheme, which the Select Committee’s report also mentioned, my right hon. Friend the Secretary of State for Communities and Local Government and his colleagues in DCLG have now opened up the process of re-evaluating the Bellwin scheme, both in the short term, to meet the needs that communities are facing as we speak, and to look at how the scheme will operate in future. Hopefully my hon. Friend the Member for Thirsk and Malton and members of her Committee will welcome that.
We are also conducting river maintenance pilots, another area that my hon. Friend focused on. In Somerset, which I have visited on a number of occasions recently, there are pilots on the Brue and the Axe, a little further away from the Parrett and the Tone, where some of the most extreme impacts of the recent flooding have been felt. Those pilots will run for a year. We need to allow them to run their course to ensure that we learn the lessons properly, because there are different circumstances in different catchments, as hon. Members from across the House have said. We must use the evidence to ensure that we use the right tools in the right places.
On sustainable drainage, we are bringing forward the regulations to implement those systems. As my hon. Friend said, progress on thatis slower than we might have liked, but we should be tabling those regulations next month and see them implemented over the course of this year.
The hon. Member for Brighton, Pavilion set out powerfully her views on climate change. I hope that she will welcome the discussions that DCLG is having with local authorities, because she mentioned the need to take into account local knowledge, what local authorities are facing on the ground and what they are having to do. There are also approaches to land management that give us the opportunity to employ a range of strategies for managing water higher up catchments, looking at dredging where it is appropriate, particularly in catchments where rivers flow slowly and there is a reliance on pumping to clear water from the land.
The hon. Member for Waveney (Peter Aldous) followed up on the Adjournment debate he secured after the coastal surge in early December. I look forward to hearing more from him about particular schemes, although he will know that I will not personally be sitting in judgment on those and that they will have to make their case alongside other areas of the country. However, hopefully the fact that we are investing the money and bringing forward the partnership money to take forward those schemes will give him confidence that we are taking such schemes very seriously indeed. We are investing in coastal defences as well, so it is not just about defences along rivers. Coastal defences are crucial, so we are continuing to invest in them.
My hon. Friend the Member for Newbury set out once again his track record on these matters. It has been a privilege to take over from him, given all his work not only on flood management, but on implementing Flood Re, which we think will make a huge difference to those who need access to affordable flood insurance and give them confidence for the future. He referred to community action and the great strength and resilience of local communities where people have helped each other, and he is absolutely right. When I visited Somerset last week I met the Flooding on the Levels Action Group, which has taken a great deal of energetic initiative not only to support communities there, but to serve as a focal point for those from outside Somerset who wanted to help, whether through financial assistance or in kind. There are many lessons to learn about really harnessing that kind of voluntary activity.
My hon. Friend the Member for Newbury stayed away from the blame game. He was quite right to point out that we could all be blamed for the weather—of course, he can sit back and relax, because it is now my fault when it rains, not his. He mentioned flood forums, which are very important. In my local area, the Cornwall flood forum is making a significant contribution to resilience and readiness in the community. It discusses not only what has happened, but what might happen and how communities can be ready for it. The National Flood Forum brings together that expertise and provides tools on its website about the property-level protection we have heard about today. The Government, through grant in aid, provide those who might struggle to afford some of those products in their home with the opportunity to have support in bringing them in, which I think is welcome. For those who have the resources to install such products in their properties, the National Flood Forum provides guidance and advice, so they should visit its website to see what is available.
The hon. Member for Reigate (Mr Blunt) talked about the impact of flooding and the need for the insurance industry to get on with the job. The Government stayed in contact with the industry throughout the Christmas and new year period and into January and February to ensure that we fed back what we were hearing from people on the ground. I have certainly been impressed by how the industry has ensured that their loss adjusters are out there. If hon. Members want to raise any local concerns with me, I will of course pass them on to the Association of British Insurers. He welcomed the help for those who have been flooded. As I have mentioned, we have offered a package of measures to help those affected. Like many other Members, the hon. Gentleman put on the record his support for those in the Environment Agency, who have worked incredibly hard during this period. It has been relentless for those who have been under threat, but it has also been relentless for the Environment Agency. It has moved staff around the country to meet those needs and performed heroically in many areas.
My hon. Friend the Member for Reigate also asked for figures on the number of properties that have been flooded. I can confirm that since the coastal surge on the east coast in early December, 6,890 properties have been flooded in England. Those properties have had standing water inside the building. Many others have experienced flooding in their gardens, on their streets or in local businesses, and many communities, such as Muchelney in Somerset, have been completely cut off. The effects will have reached many more properties, but the number that have actually been flooded is about 7,000. The Government have prioritised flood defence repair. That is why we have set aside £130 million to ensure that the capital we are investing goes to new schemes, not to repairing those that have been battered by the extreme weather events.
The hon. Member for North Dorset (Mr Walter) mentioned volunteers and the huge contribution they made in his constituency. He talked about the importance of using local knowledge, which I think is right for learning lessons on how to handle flooding and the ongoing management of watercourses and flood risk. The hon. Member for Northampton South (Mr Binley) made a similar point about local knowledge and experience and talked about campaigning to get those resources to his local area.
The hon. Member for Beverley and Holderness talked about the pressures on us all, given the changing climate, and the need to take account of the evidence in what we do. He gave the specific example of licensing costs and the Marine Management Organisation. It is important that we have agencies that work on the basis that if there is a cost, it is covered as a fee to them, so I am happy to look at those circumstances if he thinks they represent a barrier.
The hon. Member for Romsey and Southampton North (Caroline Nokes) talked about the range of solutions that might be appropriate in different areas, the importance of what local groups have done and the serious and ongoing impact on local communities. The hon. Member for Folkestone and Hythe (Damian Collins) thanked Environment Agency staff, and I thank him for that; many hon. Members are acquiring a depth of knowledge about the hydrology of their constituencies.
The hon. Member for Totnes (Dr Wollaston) made specific points about coastal management plans, and I will be happy to discuss those with her. Obviously, there will be an element of local involvement in those solutions; local authorities, for example, will play a role in protecting the road infrastructure that she mentioned. The hon. Lady was right about the fishing industry. She has been advocating intervention. I went with the Deputy Prime Minister and my hon. Friend the Member for St Ives (Andrew George) to Porthleven, in my hon. Friend’s constituency. I met fishermen there and have met fishermen in Padstow; they came from around north Cornwall to discuss the issues with me.
We are listening closely as a Government to the fishing industry, particularly those involved in crab and lobster fishing and shrimping, which the hon. Lady mentioned, to see what might be done to help. I will not make an announcement about that now, but I know that my fellow Minister, my hon. Friend the Member for Camborne and Redruth (George Eustice), is considering the matter closely. I hope that we will be able to offer support and advice to the fishing industry very soon.
Like other hon. Members, the hon. Member for Totnes raised planning issues, although those are primarily for the Department for Communities and Local Government. No doubt note will have been taken about what has been said; we can feed the points back to colleagues.
Partnership funding was raised, in relation to the Government’s approach to make sure we deliver more schemes than would otherwise be possible. We are on course to bring in £148 million of additional funding compared with £13 million under the previous spending review. The Opposition have rightly pointed out that that has not entirely happened, but the spending review period is not yet over; it would have been slightly alarming if it had all happened by this point. We are on course, and I welcome the contribution from the private sector and local government to delivering the schemes.
Recent events will have brought into sharp focus the initial emergency responses to flooding in the UK and the need to learn lessons when things have not worked as well as they might or when we can build on successful responses. We can focus on short-term recovery, but we also need to ensure that long-term defences remain a priority for the Government. I look forward to working with Members across the House to learn the lessons from the past and ensure that we protect more homes and businesses more securely in future.
Question deferred until tomorrow at Seven o’clock (Standing Order No. 54(4)).
Department of Energy and Climate Change
Government Levies on Energy Bills
Mr Tim Yeo (South Suffolk) (Con)
I am delighted that the House is debating this important subject. Its importance can be gauged by the fact that by 2020 the amount of possible spending under the levy control framework will be £7.6 billion a year, more than double the total budget of the Department of Energy and Climate Change. The fact that the money comes from consumers rather than taxpayers is, as far as parliamentary scrutiny is concerned, rather beside the point. The two categories largely overlap, and as the sums are so large it is essential that Parliament should scrutinise effectively and carefully how they are spent. I shall come back to that point.
I begin by drawing attention to my entry in the Register of Members’ Financial Interests. In doing so, I emphasise again that my views on climate change and the need to cut greenhouse gas emissions were formed more than 20 years ago, when I had ministerial responsibility at the old Department of the Environment in John Major’s Government. I studied the science as it then was and concluded—as, I hope, an open-minded layman—that the increased concentration of greenhouse gases in the atmosphere was likely to be a significant and possibly the main cause of the observed changes in the climate that the world was and still is experiencing.
My views have not changed in the intervening 21 years. I have expressed them regularly in private and public as a member of the Government and of the shadow Cabinet, including as shadow Secretary of State for the Environment and for Trade and Industry, and as a Back Bencher. The financial interests recorded in the register have all been acquired since I left the Front Bench in 2005. Suggestions that my views have in some way been influenced by those interests are not supported by the facts.
I hope and believe that we are now seeing the last gasps of the flat-earthers in the debates on climate change. The Intergovernmental Panel on Climate Change fifth assessment report has reinforced the overwhelming scientific consensus that the conditions of climate stability that the world has enjoyed in the past few hundred years and which have made possible the unprecedented and phenomenal success of one of the earth’s most recently arrived species—human beings—are now threatened by the activity of that same species.
I warmly welcome the public statements made in various parts of the world in the past few days by my right hon. Friends the Prime Minister, the Chancellor of the Exchequer and the Secretary of State for Education, all of whom have endorsed those scientific conclusions. That mainstream acceptance of the science, which is shared on a bipartisan basis by the Opposition, is very helpful because it allows us to concentrate on what the real debate should be about: how should we in Britain tackle the challenge of cutting our own greenhouse gas emissions? How can we play our part in helping the whole world move towards a low-carbon economy?
Of course I understand the fears of some about the short-term additional cost of low-carbon investment and the burden that that might place—particularly on poorer households, for whom energy bills are a significant anxiety. I also understand fears about the wider impact that that cost could have on Britain’s competitive position. Those are all legitimate concerns, and they should be assessed in the context of the knowledge that action in Britain alone will not solve the problem.
However, we need to be aware that other countries are now moving quickly—surprisingly quickly in the case of China, perhaps. Even in the United States a substantial change in what is happening on the ground has occurred in the past few years. Those extra costs will disappear entirely if the price of carbon rises, as seems probable if international concern about climate change intensifies in the next few years. I am confident that those countries—I hope that Britain will be among them—that lead the way towards a low-carbon economy will in the medium term not just have done the right thing environmentally but reap an economic benefit, in the form of lower costs and improved competitiveness, as the price of carbon rises, whether owing to the widespread introduction of carbon taxes, to a carbon price driven by emissions trading or, as seems most likely, to a combination of the two.
All that is directly relevant to this debate. I warmly welcome the establishment of the levy control framework and the pathway to 2020 helpfully set out by the coalition at the end of 2012. That was reassuring for investors and gave great encouragement to those of us such as me who are extremely concerned about climate change. It encouraged us to see that a realistic amount of support will be available to promote and support low-carbon electricity generation, including a significant element of renewable energy.
I want to look first at the scope of the levy control framework—what it covers and what it does not. We already know that a range of low-carbon electricity generating technologies will be covered; they have already been identified and strike prices for contracts for difference have been announced. It would be helpful if the Minister confirmed this evening that the list is not exhaustive and that proper consideration will be given in future to extending it. None of us knows today what technologies may be available in a few years’ time; some may offer better value for money than those available now.
I would also like the Minister to clarify how the capacity mechanism will fit into this. There is an urgent need for clarity on this subject. He will be well aware of the narrow margin of surplus generating capacity that will exist a year or two hence. Part of that problem is caused by the reluctance of investors to commit to new investment in gas-fired power stations, despite the glittering prospect of large quantities of domestic gas reserves if the reluctance of local communities to exploit them by using fracking can be overcome. I welcome the Government’s incentives, but I am not sure that they are yet sufficient to persuade some of the residents in beautiful parts of our crowded countryside. We are even seeing a reluctance among investors to bring existing gas plants out of mothballs. That reluctance is unlikely to be overcome until more details have been revealed of how the capacity mechanism will work in practice.
Of course, levy control framework money will not be confined to supporting electricity generation. Any light the Minister can shed on how it can be used to support demand-side measures would be welcome. It would also be useful to explore how the cost of supporting carbon capture and storage—on which I welcome the recent progress that has been announced—will fit into the other priorities for the levy control framework.
On to the key issue of expenditure control, levy control framework spending will, by its nature, be very hard to predict: the lower the price of gas, the greater the cost of the contracts for difference that has to be met from the LCF. Given that the Department for Energy and Climate Change forecasts that, by 2020, as much as a third of all LCF spending will be accounted for by CfDs, it would be helpful to know what assumptions my right hon. Friend has made about gas prices in the pathway through and up to 2020 in arriving at the estimate of about £2.5 billion of LCF spending that is to be allocated to meet the cost of CfDs.
Will the Minister also say a bit about what will happen if gas prices turn out to be much lower? That would, of course, be a happy scenario for consumers, because it would mean that their energy bills were lower, but it might result in a substantial shortfall in the LCF. How will that cost be met? Will consumers be expected to bear the burden of the overrun? That might not be such an unreasonable prospect, given that in such circumstances the part of consumer bills accounted for by the wholesale gas price, which is substantial, would be lower than expected.
By the same token, the opposite scenario is also interesting. What will happen if gas prices are much higher than expected? In theory, at least, the cost of the CfDs could be zero. Does that mean that lots more contracts would be offered to allow a much greater level of guaranteed support for low-carbon electricity generation, or would the Government simply rely on the market to incentivise new low-carbon investment in view of the rising cost of fossil fuels?
In view of all those uncertainties and the inherent difficulty of making long-term future projections about energy prices, will the Government publish annually an update on the assumptions about the gas price they will use in reaching their judgment about the cost of CfDs within the LCF?
On the subject of controlling costs, I would be very interested to hear the Minister’s comments about the value for money offered by different technologies. The main aim of the renewables obligation, feed-in tariffs and CfDs is to help Britain meet its greenhouse gas emission reduction targets by encouraging low-carbon electricity generation, but affordability is also a very important aim of energy policy. I note with interest that the Government believe that offshore wind may make the biggest contribution of all the technologies currently included for support by the LCF.
Caroline Lucas (Brighton, Pavilion) (Green)
I am reluctant to interrupt the hon. Gentleman, because up until now I have agreed with everything he has said and I fear that my question might lead us to depart from that. Does he agree that if we compare the strike price for nuclear in 2023 with the price of offshore wind, onshore wind and even solar photovoltaics in 2023, we will see that nuclear is vastly more expensive, and that if we are serious about keeping energy bills down, it is ludicrous to support those technologies whose price is likely to go up, rather than those whose prices are coming down?
Mr Yeo
I had a hunch that that was the issue the hon. Lady would raise. For the most part I agree with a great deal of what she says on this and some other subjects. It is perfectly true that, arithmetically, nuclear is very expensive. I think that the decision, which I support, can be justified on only two grounds. The first is that I am uncertain that, even with all the other support, we will be able to generate enough electricity from low-carbon renewables to meet the targets we have set for 2020 and beyond, from 2030 through to 2050. It would need some pretty heroic assumptions about the roll-out of some of the technologies to think that we could replace the whole of the electricity currently generated by nuclear with electricity from other low-carbon sources.
Secondly, I think there is a real prospect—though I do not suppose I will carry the hon. Lady on this point—of the cost of nuclear coming down substantially if we see a big expansion of the industry. Nuclear power stations in China, for example, are going to become almost a commodity given the number that will be rolled out. In the 2020s, we might find that we will be able to buy them off the peg at a much lower price than the admittedly high price currently expected for Hinkley Point.
Andrew Percy (Brigg and Goole) (Con)
I, too, share my hon. Friend’s concern that we will not be able to replace current generation with renewables in the way predicted. Does he, therefore, share my concern that, because of the recent “final investment decision enabling for renewables” process, we are likely to lose Eggborough power station, which currently accounts for between 2% and 4% of the UK’s generating capacity, along with 800 jobs? Given that it was a shovel-ready project, it is frankly bonkers and utterly barking mad that it has not been given the go-ahead for biomass conversion.
Caroline Lucas
It is not just a question of heroic assumptions about renewables. Actually, I think those assumptions are not so heroic, particularly if we add community energy and energy efficiency, which along with conservation is always the poor cousin in this debate. We know that we could make huge inroads on the amount of energy we use if we were serious about that. If we combine that with renewables, there is plenty of evidence from the Centre for Alternative Technology and many others that we could get the nuclear reductions we need without nuclear or more fossil fuels.
Mr Yeo
I take note of what the hon. Lady says and I respect her views, but she has not quite persuaded me that it will be safe to say no to nuclear in the immediate future. I think it is useful to have it as a weapon in our armoury, notwithstanding the high cost of this first new nuclear power station, but it is worth looking at and updating our assumptions. Nuclear is not exactly going to be in production tomorrow. There are still a few gaps to close between cup and lip before it will be in the bag. I am sure the European Commission’s objections can be adequately dealt with and I shall write to the Commission myself shortly on that very point.
I want to discuss a possible scenario. Of all the technologies being supported at the moment, the biggest expectation is for offshore wind. In 2017, offshore wind will qualify for a strike price of £140 and onshore wind for a strike price of £95, and let us suppose that the price of gas-fired electricity will be about £50 at that time. In effect, we are saying that offshore wind requires a subsidy that is double that for onshore wind and 40% higher than that for large-scale solar PV. Does that really represent good value for money for consumers?
Hitherto, I think that most consumers have been bewildered about the cost of supporting different low-carbon technologies. A system of renewable obligation certificates is obscure even to those of us who have tried to take an interest in the matter for a number of years, but suddenly it is going to become clear that certain technologies are very much cheaper than others. I wonder if, with a generous system of incentives, some of the cost advantages available to onshore wind—I know that it is probably the most controversial form of energy—were shared with the communities hosting onshore wind farms, some constituents might find the possibility of having a couple of wind turbines on the other side of the village green, given the offer of a freeze in their electricity price for as long as they were in production, less unacceptable than they currently do, but I merely speculate.
Staying with 2017, let us suppose that the gas price falls much lower, which many people would of course welcome. That would raise the cost of the already awarded contracts for difference that have to be met from the capped levy control framework. Is there a risk that the Government might have to stop offering any new contracts for difference, because it was clear that all the available money would be used up by the contracts already awarded? In that context, will the Minister explain why the Government think it is sensible to plan for as much as a third of all the electricity generation supported through the levy control framework to come from offshore wind, which is one of the most expensive forms? Will he comment on the danger that some projects that offer better value for money might get squeezed out if too much is allocated to expensive technologies early on?
Without clarity on such issues, there seems to me to be at least a risk of uncertainty in the system putting off some investors. It might at least encourage others to factor into their projects a higher price for the return on capital than would otherwise be needed in a more certain context.
Mr Mike Weir (Angus) (SNP)
I am listening closely to the hon. Gentleman, but I am slightly confused about what he is saying on offshore wind. The whole point of contracts for difference was to give certainty, as well as to give a boost to emerging technologies and get them off the ground. If the Government are now looking at not perhaps granting so many of them, does that not undermine the whole purpose of the contracts for difference system?
Mr Yeo
It depends on our priority. Mine would be to get the largest amount of low-carbon electricity generated at the least possible subsidy cost to consumers. Given the figures that are currently projected, I am simply saying that the mix looks unlikely to achieve that objective. I entirely understand the hon. Gentleman’s point that if we are to support any technology, a degree of predictability is important for encouraging investment—I am not advocating a lot of chopping and changing—but at the same time, we are in the early stages and getting better value for money might be such a high priority, given the burden that energy costs now represent to consumers, that we should consider whether the projected mix is right.
On the subject of uncertainty, although the levy control framework helpfully gives a considerable degree of predictability for the rest of this decade, seven years is not all that long given that the investment cycle in the energy industry is very long. Will my right hon. Friend say when we might get at least an indication of the likely levy control frameworks beyond 2020?
That is particularly important in the light of the issue that the hon. Member for Brighton, Pavilion (Caroline Lucas) has just raised about nuclear. There is clearly at least a perception that nuclear will take a great chunk of levy control framework money in the 2020s. If we do not know the total, some people thinking of bringing on new investments later in this decade may be put off because they fear that not enough money will be available.
The Minister of State, Department of Energy and Climate Change (Michael Fallon)
I am not sure whether I heard my hon. Friend correctly. Is he really asking me to advise the House on public expenditure totals beyond 2020—two elections hence?
Mr Yeo
I am not sure whether the total comes under public expenditure. The money is not coming from taxpayers; it might merely affect electricity prices. In the context of the fact that the Committee on Climate Change now sets carbon budgets a minimum of a decade in advance and that we now have a fourth carbon budget that covers the period up to 2028—even the third carbon budget goes beyond the period for which we know the levy control framework total—I am simply asking for some indication of the Government’s thinking. Will the total be maintained in real terms at £7.6 billion index-linked, given that a very big demand on levy control framework money will be made in the early to mid-2020s if the nuclear power station goes ahead?
Dr Alan Whitehead (Southampton, Test) (Lab)
To underline the hon. Gentleman’s point, does he agree that the likely take on CfDs in one year when Hinkley C comes on stream in 2023 will probably be more than the total money currently available for new entrants under the levy control framework? Does he therefore wish to emphasise that it would have a seismic effect on CfDs over the period 2020 to 2025, and the Minister might also want to consider that point?
Mr Yeo
I think of the hon. Gentleman as an hon. Friend, because we agree on so many important issues. He has made his point quite effectively, without the need for me to comment on it. I remain a supporter of investment in new nuclear power stations, notwithstanding the concerns about the arithmetic eloquently introduced into the debate by the hon. Member for Brighton, Pavilion. I simply make the point that without any knowledge of the levy control framework total in the 2020s, there is certainly a perceived and probably an actual risk that nuclear might crowd out some other technologies.
May I tempt the Minister to tell us what he thinks is the prospect for the floor price for carbon?
Mr Yeo
I thought that the Minister was a bit like Oscar Wilde, who could resist everything except temptation, but perhaps he will resist it on this matter. I understand why the floor price policy was introduced, but it does not cut greenhouse gas emissions by a single kilogram, and it raises the costs of British business. If the Treasury’s priority is to help Britain to become more competitive, it is slightly bizarre for it to insist on that policy. There are of course now widespread rumours that we will soon hear that the floor price for carbon will be frozen, instead of going ever upwards. If that is the case, the sooner that it is made clear, the better.
Mr John Redwood (Wokingham) (Con)
Given the mounting pressure generally from industry across Europe against very high energy prices, which forces investment outside Europe, does my hon. Friend think that the whole European framework on carbon is due for substantial amendment?
Mr Yeo
I cannot go down the route suggested by my right hon. Friend and remain within the scope of this debate, but I simply say that it is in everyone’s interest to make the European Union emissions trading system work more effectively. If it did, there might be no need for the floor price for carbon anyway. An EU-wide carbon price driven by a trading mechanism would at least be even-handed in its impact across the 28 countries of the EU, and it would not place a special burden on Britain in the way that the floor price for carbon currently does. I therefore urge the Minister to throw Britain’s full weight behind efforts being made to make the EU emissions trading system work more effectively.
In conclusion, I draw attention to my Committee’s recommendations about how the Department should report to Parliament on the cost of all schemes funded by the levy control framework. I hope the Minister agrees that accepting the recommendations would boost confidence in the Government’s readiness to seek value for money from levy control framework funds and to be transparent about decisions. As I have mentioned, the present system of renewable obligation certificates is pretty hard for most consumers to understand; feed-in tariffs, contracts for difference and the whole levy control framework should be easier for the public to comprehend. The establishment of the levy control framework was a positive and helpful development, but I am sure that my right hon. Friend recognises that exercising effective parliamentary scrutiny on how those very substantial sums of money will be spent is essential for public confidence. I commend my Committee’s report to the House.
John Robertson (Glasgow North West) (Lab)
It is a pleasure to follow the hon. Member for South Suffolk (Mr Yeo). He does an excellent job as Chair of the Energy and Climate Change Committee and it is a pleasure to be a member of it.
My great fear is that we are losing sight of climate change. With the country in austerity, people see cheap fossil fuel as an answer to their prayers as they try to keep costs down. However, climate change causes long-term damage, as we have seen with the recent floods, which are more than a little unusual. Some of us believe that that is down to climate change in at least a small way, if not in a large way.
The levies are important. About 50% of the cost goes to pensioners and those on low incomes who need help from schemes such as the warm home discount. The rest goes towards increasing investment in new plants, in the hope that there will be affordable energy in the long run. I have often taken part in debates on these matters and I make no apology for wanting to look after those in society who have the least and who need the most help.
The explanation of the levy control framework by Her Majesty’s Treasury states that its aim is to ensure that the
“fuel poverty, energy and climate change goals”
are met
“in a way that is consistent with economic recovery and minimising the impact on consumer bills.”
I think all Members of the House would agree with that, but sadly it does not happen.
The National Audit Office says that the levy control board has
“focused on cost control and not the associated impacts on energy policy outcomes.”
It is looking at only one half of the equation. We need to look at the impact of the levies on consumers’ bills, whether it is as high as the energy companies say it is or not. However, we can see their worth only if we know what the impact is. The Department of Energy and Climate Change says that its energy and climate change policies will reduce bills by about 11% or £166 by 2020. How can we know if that is the case if we do not know what the impact of the policies will be? We need to be sure about the impact on people’s energy bills.
There are recommendations in the Select Committee’s report that would make the information on that clearer. For example, it recommends:
“Easily identifiable ‘costs per customer’ for each scheme on a consistent basis across years and between reports”.
Clear reporting on how levies are be raised and spent is particularly important because the levy control framework limit will increase from £3.184 billion in 2013-14 to £7.6 billion by 2020-21. Some 83% of people are worried about energy prices, so it is important to ensure that we do not contribute to the increase in prices.
Mr Weir
The hon. Gentleman is making a very good point. Is it not also important that it is made clear exactly what the impact of a levy is on individual bills? We are often told that green levies are pushing up bills, but the renewables obligation actually makes up a relatively small part of the average dual fuel bill.
John Robertson
The hon. Gentleman makes a very good point. I have always felt that the amount of information that goes out to the ordinary person in the street when he opens his gas and electricity bill is either too complicated for him to understand or too simple and does not provide enough information. The Government have to ensure that people are educated. I am not talking only about the education of the general public, but about the education of the energy companies. They need to understand exactly what their job is in relation to customers. Yes, they are there to make money and to deliver electricity and gas, but they forget that they are dealing with real people—real people’s lives and jobs.
There has to be stronger control of the companies. If we are to take money through the levies, we need to ensure that it is spent properly and, to go back to the Treasury’s statement, that it is used to look after people in fuel poverty. We need to make it easier to show that the energy companies are trying to pull the wool over our eyes.
Mr Redwood
Does the hon. Gentleman not understand that the main reason that the bills are so high is the adoption of low-carbon technology? It is not the gross profits of the companies but the low-carbon technology that is pricing us out of markets and creating high bills for consumers.
John Robertson
The right hon. Gentleman and I have bandied a few comments between ourselves over the years. The simple answer is that I just do not agree with him. I think he is wrong. He should look at the big picture and not just at one side of the equation. There are always two sides to an equation, with an equals sign in the middle. Both sides have to be looked after, otherwise there is an unfair balance. That is what we have at the moment.
The levies make up £112 or 9% of a bill. However, bills have gone up by £300 in the past three years. Energy companies often blame the levies for the increase. An example of that is npower’s patronising propaganda in its “Energy Explained” document of January 2014, which blamed levies and even the public for the increase. Its chief executive, Paul Massara, said:
“The actual unit price of energy in the UK is one of the lowest in Europe—but bills are high because British houses waste so much energy.”
That comes from a company whose executives get a fortune in bonuses. They do all right from their company, but at the end of the day, vulnerable customers cannot afford to pay their bills, let alone install energy efficiency measures.
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
My hon. Friend is making some good points. Is it not ironic that, despite what the Government say, the levy that faces the biggest reduction is the energy company obligation, which is designed to encourage energy efficiency? We all accept that it needs reform, but is it not tragic that it is the people who lose the most money through energy inefficiency who will lose out if the impact of the energy company obligation is reduced?
John Robertson
My hon. Friend makes a good point. I will go into that matter in more detail in a moment.
The energy companies always seem to cry wolf. I think that they have cried wolf once too often. We need to have ever more control over the companies. The Minister knows my opinion on splitting the energy companies into generation and retail companies. I believe that is the way forward. That would create more companies and just might create the competition that appears not to be there at the moment.
There is a contradiction in what the chief executive of npower has said, because the company is also calling for cuts to the levies that would help people to improve the energy efficiency of their homes. The Government have allowed the energy companies to blame the levies for their own greed and manipulation of the market—I mean the greed of the companies, not of the Government. The Government are unwilling to stand up to the energy company barons. In my opinion, they serve them before our constituents. Instead of challenging the companies on their scare stories about the effect of green levies on bills, they announced that they would cut the energy company obligation and the warm home discount. How do they know what to cut if the levy control framework is not monitoring the policy impacts effectively?
The Government have cut ECO despite the chair of their Fuel Poverty Advisory Group saying:
“It is completely inequitable to attack the only measure that is doing something for the fuel poor in England.”
He said that the Government could face a judicial review if they go ahead with the cuts to ECO because of the statutory commitment to reduce fuel poverty.
The companies have held the Government to ransom over this decision. They have said that they will pass on a £50 cut to consumers and they are putting pressure on the Government by saying that they will raise prices in the months before the election if there is not a second stage to the cuts. Even after the cut to green levies, energy bills rose by an average of more than £60 this winter. It is fortunate that the winter has been so mild; otherwise we might be talking not just about prices, but about the number of people who have died of hypothermia. It is fortunate that temperatures have not been low this winter, and let us hope they do not fall in the short time remaining before the spring.
The problem is not levies, but the broken market. Policy costs are responsible for 15% of the rise since 2010. Every consumer group in this country that deals with energy has complained about the greed of energy companies, and the fact that they have ripped off customers. Energy company greed should be looked at extensively. The people at Ofgem are not bad, but they do not have the teeth to do the job they want to do. My hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) may argue that we should get rid of Ofgem. Unless we start to see more from it, perhaps he is right and we should get rid of it and put in its place something that really does the job of looking after not just companies, but the people who use the power they produce.
We need an energy price freeze, but why? Everyone says that that would be terrible, and that everything would fall apart and the energy companies would disappear. That will not happen, and the Minister knows that. There is too much money in this country for the energy companies to disappear. However, we must call a halt, look at what is happening, sit down and talk about what we want to change and why, and put together an energy system so that people can make money and provide energy, and customers can be assured that they are receiving value for money for taxpayers. An 18-month freeze on prices will allow the Government—I hope that they will be a new Labour Government—to sit down and work out what they want to do with their energy policy without worrying about whether they have to fight someone over an energy price rise. At the end of the 18 months, people will know exactly what is going to happen. That policy would be popular and right.
The Government are scrambling around trying to find something different to win support at the general election and if they come up with something better, I am sure those on our Front Bench will support it. However, at the moment, our offer is the best on the table for the general public. The Government are out of touch and it is time they got back in touch.
We are not here to fight the Government. In many ways, the Labour Government had almost exactly the same policies as those on the Front Bench today. We all agree on one thing: energy is important. The only thing we do not agree on is the priority. We prioritise the poor and the vulnerable, but the Government prioritise the companies.
John Pugh (Southport) (LD)
Today is estimates day, and in the past I have made the mistake of talking about the estimates. That was a schoolboy error. Estimates day is rather like “Fight Club”. The first rule of fight club is that members do not talk about it, and we do not talk about estimates on estimates day. It is in fact an occasion to raise issues about energy levies and so on.
I have an issue, and I must preface what I say by disclaiming the expertise that has been shown in the Chamber. I am no expert in the matter. My background in it is limited, but I want to air some big concerns, or at least one big concern—the Government’s ECO scheme, which is paid for from levies and monitored by Ofgem. As I understand it—I repeat that I do not perfectly understand it—it is multi-dimensional and it subsidises insulation, community schemes, and boilers and their replacement. It has two distinct targets: fuel poverty, which needs addressing, and carbon saving, which is a general global imperative.
It has been acknowledged that the ECO scheme has slowed down since the autumn when the debate on energy prices took off, but even prior to that I had concerns about the operation of the scheme as it stands. It depends on an industry superstructure to enable boilers to be replaced and consumers to be provided with what they need. That industry superstructure and the industry in general are in a parlous state. I have been reliably informed by people who ought to know that there has been a collapse in the market and that boilers are not being fitted with the same frequency as previously. There has been a boom and a bust. Not so long ago, there was a huge boom; now there is a substantial bust, as there is with solar panels. There are lay-offs in the trade and providers do not want to engage further. We may be looking at a slower but similar car crash to that in solar. The reasons seems to be relatively straightforward.
The remuneration that the providers hope to get from the energy companies is either plummeting or is extraordinarily fickle and unpredictable so that they cannot make their business work. For a £1 saving in carbon over a lifetime they used to receive 25p, but they now get 8p or less, and sometimes they do not know what they will get. The alternatives are not wholesome. They can fit low-class boilers, probably with inadequate maintenance arrangements, or they can concentrate on houses where carbon savings are greatest: hard-to-heat mansions.
Apparently, hard-to-heat mansions are becoming increasingly attractive. Not so long ago, the Daily Mirror printed a report about a premier league footballer who benefited under the ECO scheme, and there have been reports of people in serious fuel poverty who cannot currently benefit. There is evidence that the big providers do not want to deal too much with the fuel poor. I have seen a letter from British Gas to Sefton council asking it not to send any more referrals because it does not want to deal with fuel poverty at the moment.
My constituency has many Victorian terraces of single occupancy, hard-to-heat accommodation with old, inefficient boilers, and it seems almost impossible to make a commercial case to any provider unless the applicant can make a contribution. However, if they are in fuel poverty, they simply do not have the resources to do so. Fuel poverty seems to be fighting the other target: carbon saving. A genuine case can be made for dealing with hard-to-heat mansions, particularly if they are occupied by pensioners who may be able to qualify under some criteria.
I have had discussions with Ministers at various levels and they are more sanguine than I and the providers are. Will the Minister explain why British Gas writes to Sefton council and why energy companies make representations saying they do not want to engage with fuel poverty now? Will the Government publish up-to-date statistics so that we can see what progress is being made to alleviate fuel poverty? Will they give figures for the number of boilers fitted in fuel poverty homes, and say how close they are to the £540 million target for alleviating fuel poverty? Above all, given that I am not the expert, I would like them to speak to the companies and providers. I know that this is not the Minister’s immediate responsibility, but will he arrange a meeting with providers and assessors to look at the evidence and, if the ministerial team believes that things are going right, explain why, and why the providers think they have a problem.
At the moment, there seems to be some slight evidence of a bunker mentality. The issue was raised on the “You and Yours” radio programme, but the Department did not provide someone to tell its story. It must tell a better story, or own up to a problem and try to fix it because the problem is genuine.
Clive Efford (Eltham) (Lab)
On a point of order, Madam Deputy Speaker. I wonder whether you have had any indication of whether the Secretary of State for Culture, Media and Sport intends to come to the House to make a statement. A letter has just been issued in which the Government now accept many of the amendments that we had tabled to the Gambling (Licensing and Advertising) Bill on such issues as the watershed, a one-stop shop for problem gamblers, spread betting and financial blocking. This includes adopting many of the measures that we were calling for to protect vulnerable people in relation to fixed odds betting terminals in betting shops. That is a complete turnabout from the Government’s initial position, when they resisted all our amendments. The letter also refers to the Government announcing their position over the weekend. I do not recollect the House sitting over the weekend. I think the most appropriate place for the Government to announce changes in policy is in this House, Madam Deputy Speaker, and I wonder whether you have had any notice from the Secretary of State that she intends to come here and explain herself.
Madam Deputy Speaker (Dawn Primarolo)
I have not received any notification of a statement from the Secretary of State. It is not an uncommon practice for the Government—all Governments—to move amendments in the Lords. The hon. Gentleman’s point is not a point of order. As I understand it, the Bill will have to come back to the Commons, and I am sure that he will then find ways to make the points he has just made. He has got his views on the record.
Dr Alan Whitehead (Southampton, Test) (Lab)
I want to draw attention to a number of curiosities in relation to the levy control framework and Government levies for underwriting various new, and sometimes not so new, forms of power for the future.
The first curiosity is that the levies are not in the estimates: according to accounting conventions, they cannot be. One of the central things to which the Energy and Climate Change Committee drew attention was the fact that because the current accounting regulations mean that levies cannot be placed within end-of-year accounts or estimates for the Department, some fairly urgent action is needed to bring those issues back under the parliamentary gaze and make them accountable to and discussable by this House.
As we heard from the hon. Member for South Suffolk (Mr Yeo), the Chair of the Committee of which I am proud to be a member, much work to decarbonise the UK’s energy economy is underpinned by levies on energy bills. The chosen instrument that the Government have introduced to control those levies is the levy control framework, which is itself a very curious beast that was introduced by sudden fiat in the Budget of 2011. It was announced in the additional document to that Budget called “The Plan for Growth” but without, as far as I know, any debate, pre-scrutiny or other examination of its effect as regards the inclusion or exclusion of various levies. Subsequently, without that examination, it has controlled, pretty selectively, DECC’s spending on support for renewable and low-carbon energy.
I say “selectively” because although it was claimed, as the original Treasury paper stated in introducing it, that that the levy control framework
“will include all DECC’s existing or new policies which entail levy-funded spending”,
it does not do anything like that. In effect, it controls selected and nominated levy-funded underwriting for certain activities. It initially controlled the renewables obligation and the feed-in tariff for smaller renewables, and it has controlled the warm home discount, although that has recently disappeared into general taxation. In future, it will control the renewables obligation’s successor, contracts for difference, with continued payments from the renewables obligation after the system switches in March 2017. The RO will not go away; it will continue for a long time after the change has taken place and will continue to control feed-in tariffs for solar and small-scale renewables.
The total controlled expenditure will be some £7.6 billion, in 2011-12 prices, in 2020-21, rising from just over £3 billion in 2013-14. That sounds not just like a lot of money but like a huge increase in money, but we must remember that it is the total that has to underwrite the target of 30% of renewable electricity generation by 2020. In some scenarios published by DECC, it may just about achieve that, but in other unpublished scenarios it may not. The reason it may not is that the expenditure total has to include not only the cost of new entrants each year, as those new entrants come to produce renewable and low-carbon power that contribute towards the target, but the cumulative overhangs of what has already been agreed previously under the renewables obligation or, after 2017, contracts for difference payments, which will run on for 15 years after they have been agreed. In most instances, RO payments will continue for 10 years after they have ceased being issued in 2017. Over the whole period up to 2020, certainly, and even after that, all the payments that have been agreed for any new projects will continue throughout the whole period and will accumulate within the levy-controlled total expenditure.
We do not know how the figure of £7.6 billion for 2020 was arrived at—it was simply announced. Only more recently have estimated figures on the annual margin that will be available for new entrants every year been published. It turns out that those figures will be slightly less per year than is currently available for new entrants each year in terms of new renewables obligations and, subsequently, contracts for difference. I personally feel that given DECC’s figures on how it will achieve a doubling of the deployment of mainly offshore wind by 2020, the aspiration is probably a little heroic.
Another curious aspect of the levy control framework is that it controls the sums involved but not what is actually deployed. In the case of the renewables obligation, it is reasonably possible to forecast what expenditure might be against deployment. Indeed, according to the National Audit Office, DECC has produced pretty accurate figures for this over the several years of the levy control framework so far. However, when contracts for difference are introduced in March 2017, it will be much less easy to do that. That is because the amount of underwriting, and hence levy, that arises from a contract for difference is inherently variable and only predictable in ballpark terms. What a generator gets as a payment is the difference between the agreed amount for the strike price and the reference price, which is the prevailing price of wholesale electricity in any one month. If the price dips, the amount paid increases; if the price rises, the amount paid decreases.
It is certainly conceivable, as the Chairman of the Committee suggested, that in circumstances of a high wholesale electricity price, generators could start paying back money that they have obtained because the reference price is higher than the strike price. It would be interesting to see whether any consideration has been given to how that money coming back might be deployed and whether it would be put towards more renewables investment or disappear into the Treasury; I suspect I know the answer. It is at least a possibility that that could happen over the next period. The point is that the generator gets a known return but the levy payments themselves could vary enormously. If, for example, the Chancellor caps the carbon floor price in 2016, that would probably reduce the price of electricity, albeit by encouraging high-carbon generation. It would, however, increase the payment that generators get from the CfD, possibly quite substantially. Owing to the fact that the amount is capped each year against a small amount of additional headroom for the Department, which then needs to be adjusted over the next year in the Department’s subsequent estimates, room for new entrants could be dramatically squeezed through the payments of larger sums each year. Therefore, as a tool to cap expenditure on levies, the LCF may function, but it cannot underpin a clear level of deployment over time. It deals with one side of the equation but not the other.
The next curiosity of the levy control framework is that it does not really control levies overall. As we saw recently, the only levies that were removed or altered in the so-called green levy review were ones that did not have a control over them at all, or that will be out of the LCF by 2020. As we have heard, the energy companies’ levy-based obligation is exactly in line with the levy control framework. What was not within it was eviscerated, with calamitous consequences for local authority and housing association solid wall and hard-to-treat home schemes. The warm home discount has gone into being funded by general taxation.
The levy control framework is supposed to control levies that are defined by the Office for National Statistics as tax and spend—that was in the original Treasury document that set out the LCF. In fact, it is defined by the ONS as putative tax and spend. Although no money goes into the Exchequer, the effect on the consumer is as if a tax had been levied, but with no control over it. As I have underlined, that was the stated intention of the LCF in the document that introduced it.
The original levies preceding the levy control framework were introduced precisely because they were off the books and would not count against spending totals. However, the LCF effectively makes them count again, dependent on the ONS definition. One might say that a policy that levies charges on consumers because it does not count, but is then controlled through a mechanism that makes it count, is rather a circular policy. In the long run, it might better be replaced by a policy that levies a tax on companies and people’s wealth, and then allocates that to underwrite the desired deployment to plant—perhaps that points out something that must not be said.
The levies counted in the levy control framework will be, as the original document states, based on ONS independent definitions. However, the ONS barely got round to classifying previous levies—the community energy savings programme and the carbon emissions reduction target—before the LCF came in. Indeed, it classified those as putative tax and spend, but only after they had come to an end. The Treasury then had to predict what the ONS might do if it classified some newer levies to set up the LCF.
One could say that the choice of what was in or out when the levy control framework came about has essentially been a political and not a statistical decision, underlined perhaps by the curious fact of two enormous levies. One of those is the energy company obligation, which could perhaps now come to £2.6 billion over four years. Most significantly, coming down the road, we ought to know the capacity market payment system, which is potentially £1 billion a year on average until 2020. Those are levies on customers’ bills to persuade energy companies to build gas-fired power stations and make them available for the provision of power, not to pay them for providing power. If they then provide power, having made themselves available and got a levy as a subsidy, they will be paid again. That is definitely coming down the road—a huge levy increase outside the LCF. Those are clearly levies and will turn up on customers’ bills. Probably, if included, they could double the control total.
The ONS has not yet got round to considering whether ECO should be counted in, and as far as I am aware—probably for quite prudent reasons—it has not gone anywhere near capacity payments. In any event, DECC is still figuring out how to manage and control such matters, as well as how to manage and control the energy demand reduction side of capacity market payments should they be included in the energy auctions that, as I have mentioned, will be coming down the road.
Some levies have, of course, already gone down the taxation route. The renewable heat initiative was to have been a levy but it is now funded from general taxation. The warm home discount has recently gone from being a levy to being funded by general taxation, and—still to come—the money to support carbon capture and storage has shrunk to £1 billion and is also funded from general taxation, with no clarification as to whether subsequent CCS gets a CfD, and will eventually be in the LCF. Perhaps it will get capacity payments that are levied but not in the LCF, or perhaps it will just get support from tax. There is, therefore, no consistency about what is controlled and what is not, and apparently no clarity on the horizon.
We then come to the next curiosity of the system. Apparently, including estimates and outcomes of levy controlled expenditure—it never really arises as solid tax in and solid expenditure out—cannot, as I have emphasised, safely be put in departmental estimates or end-of-year accounts. Since 2012, no levy expenditure in accounts or estimates has been put forward by the Department. That brings us back to where we started. The LCF was sprung into being without debate or scrutiny from this House. We do not know what goes into the figures in the framework or whether the expenditure undertaken is value for money, because none of the workings is in the accounts and estimates. We do not even know what relationship there is between the policy objectives of each levy and their likely realisation. It seems that the agreed policy outcome of the deployment of renewables has possibly been seriously compromised by the introduction of the LCF, but we do not know because nothing is there to assist with finding out.
We know that ECO will now not even remotely reach its suggested policy target of 180,000 hard-to-treat home treatments by 2015, but we have not had a chance to discuss or debate either the initial policy or its revisions. The whole question of levies lies, it seems, outside the policy and scrutiny process. Both the NAO and the Energy and Climate Change Committee found that to be highly unsatisfactory, and suggested imperative remedies. In a letter to DECC, and in its most recent report on the LCF, the Committee suggested:
“There should be a single annual report covering all the DECC levy-funded schemes along with other Government initiatives which affect energy bills but fall outside of the Levy Control Framework,”
in the way I have illustrated. It said that that report should contain:
“Future plans, and comparisons of agreed budgets and final spend (outturn) for each funding stream.”
It should have:
“Easily identifiable “costs per customer” for each scheme on a consistent basis…including the impact that government decisions have upon requirements over time.”
and should contain:
“Measurable outcomes achieved through spending, including as a minimum the progress made against carbon targets and…other specified objectives of the schemes, and the impacts on consumers.”
That should certainly include
“an appraisal of the relationship of the LCF to its overall policy targets.”
I heartily endorse those recommendations, because at the very least they will bring the rationale and its relationship to policy objectives set elsewhere in Government under the purview of this House, so that that can be properly appraised. That, and the value for money or otherwise achieved by the process, can be properly appraised and assessed by this House, both at estimate time and at outturn time.
I would go further and reflect on the last line of the Select Committee recommendation. It is clearly deeply unsatisfactory that some levies are in a control framework, some are outside and some have, for purposes of expediency, been placed into general taxation. There should be consistent treatment for all. If we are not to go to a system that, ultimately, is better all round, but which I know causes problems with our odd British method of accounting for public expenditure that is at odds with how most other European countries do it—namely, by raising taxes openly and allocating support openly on the basis of what has been raised—then at least levies across the board should be treated in the same way. After all, they all end up in the same place—on the customer’s bill—and the overall positive effect of the levies, which in the longer term are certainly likely to be beneficial to those bills, can be properly appraised and prioritised.
As matters stand, we are essentially presenting a series of obscurely worked out and obscurely justified schemes as, somehow, a major and coherent policy driver. They most certainly are not. Fundamentally, the levy mechanisms should relate to the policy goals they are supposed to underwrite. What are the best value and most efficient mechanisms that will take us where we want to go on policies, once they have been decided? As it stands, the levy control framework is a very long way from doing that.
Sarah Newton (Truro and Falmouth) (Con)
I am sure we can all agree that delivering an energy policy that guarantees security of supply at prices businesses and people can afford is an essential and challenging task, especially after years of procrastination under the previous Government. This Government’s energy policy, based on a mixture of generating capabilities, is vital to our national security. The more energy we can produce on our own shores the better. The current situation unfolding in Ukraine is very worrying in many ways, but it is a timely reminder of the risks of relying on imported gas.
The Government are right to back renewable energy. It is particularly important to look at marine renewable and geothermal. As a Member of Parliament representing the south-west of England, hon. Members would expect me to say that. I was absolutely delighted when the Government set up the South West Marine Energy Park. I can perhaps give the hon. Member for Southampton, Test (Dr Whitehead) some of the evidence he was asking for, on the positive impact of the Government’s policies on renewable energy, from my experience in my constituency.
As a result of the announcement before Christmas of the strike prices for renewable energy, we have seen a huge increase in interest from overseas investors into marine renewable energy in my constituency. We are the home of the Falmouth bay test site, the FaBTest site, which is a very innovative partnership between the university of Exeter, the Falmouth Harbour commissioners and local businesses. It is an excellent site to pilot and test marine renewables which enables developers to understand how much energy can be created and the economics of it, which can then be scaled up to fully deployed devices on the wave hub. We have seen investment already, from Scandinavian countries, to build new devices that are currently being deployed, with a great pipeline to come. It is attracting not only investment but a great deal of new, high-quality engineering jobs to my constituency, all of which is to be welcomed.
Dr Whitehead
I underline the hon. Lady’s point that wave, tidal and other new forms of energy are beginning to secure a lot of investment, and invite her to attend the all-party group on renewable and sustainable energy meeting tomorrow on precisely that topic. We would be delighted to see her there.
Sarah Newton
I welcome any opportunity to draw attention to the fantastic and innovative work of companies in my constituency to create wealth, prosperity and new jobs, so if I can find time in my diary I will certainly come along.
I have seen evidence of the substantial impact of the new strike prices for renewable energy in the short period since they have been announced. Among all this good news, however, there are a few issues I would like to draw to the attention of the Minister.
My hon. Friend the Member for Southport (John Pugh), who is no longer in his place, made some very good points on the impact of the changes to ECO announced in the autumn statement. The reduction of people’s energy bills by about £30 to £35, as a result of those changes, has been welcomed by households across my constituency and, I am sure, across all hon. Members’ constituencies. However, some of the measures—particularly the reduction in the carbon emissions target for hard-to-treat homes by a third and the extension of measures to include cheaper options such as loft and cavity wall insulation—have had an impact on off-grid customers living in fuel poverty in my constituency, and have made the introduction of soluble insulation to low-income households virtually impossible.
Why is that important? The changes are having a disproportionate effect on constituencies in rural areas such as mine, where 35% of homes have solid walls compared with 22% nationally, and 48% of households are living off the gas grid compared with just under 15% across the country. As we all know—we have debated it many times in this House—people living off the gas grid pay much higher energy bills than those who are on the grid. Under the Hills definition of fuel poverty, that affects about 10% of households in my constituency, and that figure will be replicated across other rural areas. The Minister has taken great care to listen to MPs representing areas such as mine, and has taken real steps to try to tackle fuel poverty in off-grid households. Will he consider taking two further steps that could have an important impact?
The Minister created the off-grid ministerial round table, which is already proving to be a very valuable body that has made improvements for the group of people concerned. At the next meeting in May, I would very much like him to consider evidence from members of that round table, such as Community Energy Plus in my constituency, on the impact of the ECO changes on its ability to tackle fuel poverty in off-grid households. There might be some very simple tweaks, without extra cost, that could be made to the programme to enable us to help people who are particularly hard hit by the changes.
Secondly, will the Minister consider inviting the head of Public Health England to join the round table? Public Health England has rightly identified the reduction of fuel poverty as an essential health outcome. As we all know, living in cold homes exacerbates existing health conditions. It can often lead to unplanned emergency admissions to hospital and lead to a delay in people going back to their homes, because of the detrimental impact of allowing them to move back home. We live with the blight of excess winter deaths. The national health service has ring-fenced budgets, as do public health bodies and local authorities, and I think that they have an important role to play in driving down fuel poverty. Community Energy Plus in my constituency has been working with health officials and with me to develop an evidence base and a toolkit that will enable public health commissioners to fund insulation and other measures that would allow people to live in warmer homes. It would be excellent if work of that kind could be shared at the round table, and if Public Health England took up the challenge to provide an evidence base that would enable people working on the energy company obligation and on improving the energy efficiency of homes to work alongside health officials around the country in driving down fuel poverty.
I welcome the Government’s approach to energy policy and to tackling fuel poverty. I hope that the Minister will consider the simple steps that I have described, because I think that they could make a positive difference to the health and well-being of my constituents and others throughout the country.
Mr Mike Weir (Angus) (SNP)
We have many debates on the cost of energy to consumers, because the issue is vitally important, especially at this difficult time. The so-called green levies are often identified in the press, and sometimes in the House, as the cause of rising energy bills, but we cannot escape the fact that they are there for a reason. Their purpose is to provide our energy infrastructure for the future, and to ensure that money is invested to promote renewables and take carbon out of the energy system. Only in that way can we reduce energy bills and ensure that they stay low.
Last week the Prime Minister reaffirmed his view that man-made climate change is the most serious problem that affects us all, and it was good to hear that. Let us hope that this time he really means what he says, and will not move on as soon as he has hugged the next husky.
There are still people in the House of Commons, in the other place and outside who deny the reality of climate change in the face of mounting scientific evidence and, indeed, the evidence of our own eyes. The impact of climate change is variable, but it is also undoubtedly dramatic and dangerous. We cannot point to one weather event and say that it is a direct result of climate change, but we can see the pattern that is developing, and acknowledge that our climate is changing. Most of us agree on those points, but if we are to challenge the problem, we must obtain the money and take the measures that are necessary.
We must be brutally honest: if we leave the matter purely to the market, it is highly unlikely that there will be investment in a green economy and carbon-free energy. In the current market conditions, the cheapest form of energy is probably coal. Indeed, more coal is being burned for energy than has been the case for quite some time. However, we also face increasing energy demands, and the combination of the two could spell disaster for our climate. We need only think of the massive smog cloud that engulfed Beijing last week, when even indoors the pollution levels were above World Health Organisation safety levels. To be fair, the Chinese are now coming round to investing in greener energy in order to tackle their problems, but that remains a warning of what we could face if we do not act to tackle our problems. We have done it before: city smogs here became a thing of the past because of regulation, in particular the introduction of the Clean Air Acts.
Totally free markets will not take us where we need to go, so the Government must continue their efforts to ensure that there is real action on tackling climate change and the greening of our energy system. An enormous amount of money is needed for that project, but it should not be seen purely as costs; it should also be seen as investment. As I said earlier to the hon. Member for South Suffolk (Mr Yeo), I was rather concerned about his description of offshore wind farms and the contracts for difference that were needed for them. Having sat through the debates on the Energy Bill and heard what was said about CfDs, I understood that they were variable so that an extra boost could be given to new, untried technologies that needed a lift in order to take off, and so that the subsidy given to established technologies could be reduced. That struck me as perfectly reasonable, because the huge cost of offshore energy will undoubtedly require that extra boost. I would caution against considering alternatives to it just because it is expensive; it has reduced the need for onshore energy.
As we heard from the hon. Member for Truro and Falmouth (Sarah Newton), renewables are making a great difference to local economies throughout the country. They are driving the development of many parts of the new economy. Renewable energy is now a significant part of Scotland’s economy: 11,695 people are in full-time employment in the industry, an increase of 5% over the last year, and the industry is confident that it will continue to expand and employ more people. The latest figures from the Department of Energy and Climate Change show that in 2012 renewables accounted for 40.3% of gross electricity consumption in Scotland—7.5% more than in 2011—and for nearly 30% of Scotland’s total, a record proportion.
In my constituency, there are plans for substantial offshore wind arrays that have the capacity not only to generate huge amounts of renewable energy, but to push investment opportunities and new jobs. However, that will happen only if the CfDs are there to make it happen. My area used to have huge engineering works that went in the dreadful recession of the 1980s, but engineering survived in niche businesses and we are now seeing a real revival in businesses associated with the oil and gas industry—which is vital to the north-east of Scotland and where businesses such as GE Oil and Gas in Montrose are expanding—and many more smaller firms that are part of the oil and gas supply chain and increasingly the renewable supply chain as well. That is where much of the future development will come from.
Apprenticeships are growing, giving real opportunities for youngsters in my area to get a good long-term career, and the skills are transferable into the new renewable industries, giving continuity and a real future in sustainable jobs.
There are problems in the way that electricity market reform has been introduced, however. There have been delays, which have caused concern about investment. Some of the proposed developments have not come to fruition because of the changes to EMR, particularly in respect of onshore wind farms. SSE pulled out of two protected developments.
Much of what has been done has been possible only because of the renewable obligation. I accept that has put some costs on our energy bills, but it has also allowed us to fund programmes that have led to greater efforts to insulate homes, reducing energy use and future bills for consumers.
The hon. Member for South Suffolk mentioned the effect of nuclear—when debating with the hon. Member for Brighton, Pavilion (Caroline Lucas), I think. I was interested in what he said about almost off-the-peg stations coming from China. I have some dubiety about the future of nuclear, it must be said, and my friend the hon. Member for Glasgow North West (John Robertson) and I have debated that on many occasions. The cost of Hinkley Point is of interest to me, and interests in the European Union seem to be looking slightly askance at that. It is worth noting that the cost of the subsidy to Hinkley Point alone is over four times the total cost of the renewables obligation across the whole of the UK during its first 10 years in operation. That puts into perspective the amount of money that is involved. It is also worth noting that I saw a story earlier this week that a plan for a similar design in Finland which is already vastly over-budget and way behind schedule has now been put back for several more years. We really have to wonder just what contribution nuclear will make to energy in the foreseeable future. It seems to me this contract is ruinously expensive and will impact adversely on energy bills throughout the country.
We have to ask whether energy bills are now too high, however. Unfortunately, I think that is true, but it cannot be laid at the door of the so-called green levies. Let us look at the breakdown of costs in our energy bills as set out in the Commons Library note “Components of an energy bill”. It sets out that environmental and social levies amount to between 8% and 10% of the typical domestic dual-fuel energy bill. That is the proportion before the changes announced by the Chancellor in the autumn statement, which, as has been said, removed the funding of the warm home discount from energy bills and should have reduced the proportion further.
Figures produced by the Department of Energy and Climate Change break things down further, and that leads to an estimate that only 2% of the average dual-fuel bill is due to the renewables obligation, which up until now is what has supported large-scale renewable generation, feed-in tariffs and small-scale renewables. That amounts to some £30 a year on the mythical average bill.
I do not deny that for hard-pressed families even such a sum is significant. However, it is not the main driver for increasing energy prices. That is the wholesale energy costs, which according to DECC’s own figures account for between 46% and 48% of the bill. These costs are susceptible to many outside forces, of course. Prices are currently rising quite sharply with the increasing tension in Ukraine as Russia is a major supplier of energy, and in particular of gas to Europe.
I was also interested in the point the hon. Member for Southampton, Test (Dr Whitehead) made about CfDs and gas prices. The idea behind that, as I understand it, was that we would have a definite price for gas. That rising cost is the main driver for energy bills so, in theory at least, if we have a set cost under CfDs for that gas, it should prevent the spikes we have seen in the past and give the consumer, as well as the company, some certainty about what they are going to pay, although nothing in this world is certain.
Bob Stewart (Beckenham) (Con)
I am just trying to get this clear. The hon. Gentleman mentions figures of about 8% to 10%, reducing to 2% for renewables, with 46% as the cost of the energy. Is the rest tax? What is the tax percentage in the average energy bill in the hon. Gentleman’s example?
Mr Weir
It is not my example; I refer the hon. Gentleman to the House of Commons Library note on this subject, which sets out clearly the various elements, as I do not have it with me today. Obviously, energy companies will make a profit, and part of the taxation on energy bills is 5% VAT. The point about the 8% and the 2% is that only 2% of the bill is directly relatable to the renewables obligation. The differences between the two are the social obligations—the insulation costs and the other costs for creating warmer homes and reducing future energy bills.
It will be interesting to see how these changes feed into energy costs. If, as is claimed, the major companies are operating a hedging strategy for gas that forces them to buy well in advance, there should be little immediate effect—I am referring to the current rise in prices because of what is happening in Crimea. But those who buy the bulk of their supplies on the spot market may well see an immediate impact. It will be interesting to see whether there is a turnaround in who has the higher energy prices as a result of that.
A further major element in bills is the network costs charged to energy suppliers, which, according to the note, make up 20% to 23% of the costs. I have spoken on that issue many times in this House, as well as on the unfairness of the costs, which discriminate against generators, particularly renewable energy generators in the north of Scotland compared with major generators in the south. The regulator, Ofgem, has been looking into this matter, in a seemingly endless investigation, Project TransmiT, which I understand has been put back yet again to a possible introduction in April of next year. There must be more action and a fairer system of transmission reduces the costs faced by renewable energy. That would have a positive impact on bills by reducing the cost to the consumer.
All that having been said, we do need to look at the balance between investment and the price paid by consumers. I support the idea that some of the costs that have been imposed upon consumers are taken off bills and put on general taxation, specifically those relating to providing energy efficiency and insulation measures. It is not often I agree with the Minister, but that was correct.
Mr Weir
The hon. Gentleman need not worry too much.
Under the green deal, many measures under the energy company obligation are left to the energy companies to set up and administer, but that is not working. I have raised concerns about aspects of the specific schemes, but the overriding fact is that there is now a complete lack of trust in the energy companies and having them approach people offering such schemes will not achieve the take-up we need. Suspicion alone will stop many people taking up what could be a good scheme. We should be made to examine how we deliver these things, because if we were to have a more focused scheme, we could do more, for example, in hard-to-heat homes in the areas mentioned by the hon. Member for Truro and Falmouth, by making sure that these specific issues are tackled.
I have raised other issues relating to the ECO, one of which may interest the hon. Lady, who, like me has many constituents who are off the gas grid: many energy companies will not have replacement boilers for off-gas-grid appliances. I have written to all the major companies to press them on the issue. I have raised it at ministerial round-table meetings—I am sure that the Minister is fed up with hearing about it—and in the House, but the situation remains. We really need action on such areas. We were told by Ministers that the ECO was technology-neutral, but that is clearly not so for off-grid consumers.
The Government’s usual mantra of energy efficiency and switching simply does not wash with those who are struggling to pay their bills. The savings on offer would barely scratch the surface of the problem. All too often, energy companies seem to be carrying out a follow-my-lead strategy on price rises. If someone switches when their company raises prices, they may just be delaying their own price rise until the next company makes its move. It is not surprising that cynicism has taken hold among the general public. We must make it clear to our constituents that there is no silver bullet to solve the problem of energy prices. Yes, we need to look closely at how the energy companies operate, which the hon. Member for Glasgow North West has talked about on many occasions. In fact, that is one of the things on which we agree.
We need transparency in the system to see not only how the companies make their money but the inequalities. In the Energy Act 2013, the Government sought to take powers to implement the Prime Minister’s promise to put everyone on the lowest tariff, but, as I have said many times, the Act does not seem to have that effect. What it does is to require the energy companies to facilitate the switch, but the offer to do that may well not be obvious to many people who receive a mass of paper through their doors from the energy companies. There must be a much more proactive effort to put people on to the lowest tariff. It also seems that, under this scheme, it is only the lowest tariff operated within the type of contract the person already has. As I have said before, that is fine if someone is on a direct debit tariff, but if they are on a prepayment meter, for example, they will still be stuck on a higher tariff, and there is little being done to help those people.
If we are to explain clearly what the costs of energy are and to do what we can to reduce energy bills, we need to ensure that everyone is on the lowest possible bill. We need to get away from the fact that companies can claim that bills are the result of green levies or other levies, when clearly that is not the case.
I have spoken a great deal about prepayment meters before, and I will not do so again any great length again. However, I will just say that the citizens advice bureau in Scotland cites the case of a single parent with two children. The mother currently has to lose £7 to arrears every time she puts £10 in the meter. The £3 remaining is entirely insufficient to heat her home. Such things cannot be allowed to continue if we are serious about bringing the public on board. They must understand that we are serious about not only ensuring that the infrastructure is in place and that we move towards green energy, but about doing what we can to reduce energy bills.
I have also spoken before about the fact that some people who have prepayment meters or who are in arrears often do not have bank accounts. The banks are not interested in the low-income customers. Indeed many of them have moved out of areas such as the rural parts of my constituency.
The hon. Member for Truro and Falmouth mentioned off-grid customers, so I will give another plug for my favourite campaign for earlier winter fuel allowances for elderly people who are off the gas grid. I am pleased to see that the Labour party has now adopted that as policy. I have been campaigning for it for some time, and I am glad to have its support for that policy. It is interesting to note that both major parties have supported that at one time or another. Strangely enough, they have done so when they have been in opposition, not in government—call me a cynic, but there we go. We will wait and see.
All too often when we debate energy, we focus on electricity consumers. We must look at the whole system, and I am glad that we have the opportunity to do so today. I think that I have spoken for long enough, and I will end by saying that this is a good opportunity to make the point that we should not just look at green levies. There is a reason we have this ongoing system: to decarbonise our energy and ensure that bills stay low in future.
Andrew Percy (Brigg and Goole) (Con)
It is a pleasure to follow the hon. Member for Angus (Mr Weir), particularly as he finished by talking about off-grid customers, and I wholly concur with his comments. I represent a number of off-grid communities, and all the problems highlighted by other hon. Members obviously affect my constituency.
We have had two debates in which fossil fuels have, perhaps for understandable reasons, come in for a bit of a bashing, but whenever we debate them, I like to remind the House that many thousands of my constituents work in the coal and gas and the offshore oil and gas industries. This is still an important sector of the economy, and they play a valuable role, whether by working at coal-fired power stations, at Kellingley or Hatfield pits in my constituency, or offshore.
Throughout this debate we have witnessed the flogging of a dead horse: the energy price freeze—an idea that has been roundly rubbished, including by the public. What would happen in such a situation is clear: prices would go up before a freeze, and they would go up again after a freeze. The public have not been conned on that one. Many of my constituents contacted me when that policy was announced, and they had figured it out for themselves; they needed no assistance from me or my party to do so.
It was interesting to hear about ECO. A good project is going on in my constituency, where funding from the Dragonby wind farm has been used to support ECO funding to put energy efficiency measures into the small community of Dragonby, not too far from Scunthorpe. I see my constituency neighbour, the hon. Member for Scunthorpe (Nic Dakin), here. The project is proving effective, and I will be on site next week, as the next phase of construction takes off .
I want to focus most of my comments—this will probably not surprise the Minister—on Eggborough power station, which is in the constituency of my neighbour, my hon. Friend the Member for Selby and Ainsty (Nigel Adams), but is a big employer in my constituency. I can see from my front room Drax and Eggborough power stations. If I go upstairs, I can see Ferrybridge power station. Powers stations are something that we live with locally and something that we love locally, not least because of the large number of local people employed in them.
Obviously, there is a massive black cloud over Eggborough, which is one of the UK’s largest coal power stations, producing between 2% and 4% of the UK’s capacity, depending on whose figures are believed. But whether the figure is 2% or 4%, given that Ofgem predicts an energy margin of as low as 2% by 2015, Eggborough is incredibly important to generation. Sadly, however, EU environmental regulations and the carbon floor price mean that Eggborough will be forced to convert to biomass or face closure. Indeed, I have been concerned about the carbon floor price from the beginning. That is why I voted against it, along with my constituency neighbour, my hon. Friend the Member for Cleethorpes (Martin Vickers) and, indeed, the hon. Member for Scunthorpe. As ever, north Lincolnshire has been united on this issue, because of the large number of important carbon-intensive industries on the south Humber bank.
Eggborough has been working on a £750 million conversion project that would have started on 6 January and been the UK’s largest infrastructure project in quarter 1 of this year. That investment would have secured 800 jobs, many of them in my constituency, and created even more jobs further down the supply chain. That is on hold. For the past couple of years, Eggborough and local MPs have had positive policy signals from the Department of Energy and Climate Change that conversion to biomass would be supported through the final investment decision enabling process. We are pleased as local Members of Parliament that Drax has been secured through that process, but all the signs were that a rapid conversion to biomass at Eggborough would be supported, not least to sustain that important generating capacity on the grid as well as to meet our renewable targets. This was a shovel-ready project, as I have said, with £750 million of inward foreign investment already in place. The final decision was dependent on the FID enabling process. Several drafts of the documentation were produced, and by the third and final draft something seems to have changed in the selection criteria. Just a few weeks before the final announcement applicants were informed of the change and, as a result, Eggborough was excluded.
Michael Fallon
May I make it absolutely clear to my hon. Friend, probably for the nth time, that the selection criteria were not changed? It was always clear, in each of the updates on the FID enabling process from the beginning of last year onwards, that the budget might have to be constrained if there were more applications for biomass conversion than the budget could accommodate. I am delighted that we could accommodate, through immediate selection, the biomass conversion plant to which he has referred at Drax.
Andrew Percy
I thank the Minister for that, but it is not a situation or an explanation that Eggborough, others involved in the debate or I accept. Yes, I grant it to the Minister that it was clear in the initial documentation that there were a range of selection criteria. That was mentioned in passing in the first draft. By the third and final draft it appears to have become an overriding consideration and criterion. That is what we believe has changed. If that was not the case, why were positive messages given to Eggborough throughout the process? It would have been clear at the beginning that Drax and Eggborough could not both have been funded, given the scale and size of the Drax conversion and the budget. Later, the range of technologies seems to have become the overriding criterion, which is why other local Members of Parliament and I have sought to clarify what happened and are concerned for our constituents who work in this important power station.
As for the impact of the change, Members of the other place and I have recently tabled parliamentary questions to demonstrate that the Government have made no assessment of the impact of the change in policy, nor of the impact on bills. When I intervened on my hon. Friend the Member for South Suffolk (Mr Yeo), my hon. Friend the Member for Suffolk Coastal (Dr Coffey) shouted at me that it was all about how cost-effective this was. Well, we do not know the cost of losing this generating capacity. Eggborough has announced that it will be forced to close unit 2, which provides about 1% of generating capacity, in September this year. According to the most recent information available, the management at Eggborough believe that the plant will no longer supply energy to the grid at all beyond 2015.
There is a crunch coming in 2015, perhaps as low as 2% of capacity, and here we are, about to take off 2% to 4% of generating capacity. The appropriate notices have been issued to National Grid, Ofgem and DECC. The Government may not have made an assessment of the impact on bills, but others have. The loss of that capacity could result in a £38 rise in consumer electricity prices, with £25 due to capacity crunch forcing up the wholesale price, and an estimated £13 of additional cost to decarbonise using technologies that are more costly than biomass conversion.
As I said in the meeting with the Minister and one of his officials, we potentially face a situation in which 800 people who are currently gainfully employed will be sitting at home, having been fired, paying increased bills for a form of generation that is 50% more expensive than the form that they were sacked from generating. To me, and to my constituents, that seems completely and utterly barking mad. It must not be allowed to happen.
We know full well that the process was changed—recalibrated perhaps—over a range of technologies, which seems to have become the overriding factor. There are technologies, largely offshore wind, that have come out ahead of Eggborough, even though they have no finance behind them and do not have planning permission in place, compared with a shovel-ready project that was ready to go.
The figure of £38 for the addition to bills might be disputed, but we have received no answers to our parliamentary questions that show what the impact would be. Perhaps it is worth delving into that in more detail. The £38 is based on the fact that annual wholesale consumption in the UK energy market is 360 TWh. If wholesale prices rise by 10% due to the supply crunch, that would add £5 per megawatt to the wholesale market, which equates to about £1.8 billion per annum. About a third of the market is for domestic households, so that is £600 million between 24 million domestic customers, which works out at £25 on domestic bills. Filling the 4% capacity gap, or maybe the 2%—the figures are disputed—with the more costly renewable technology will result in an additional £13, based on a total cost of £3.4 billion over the life of the project.
It is unfortunate that we find ourselves in this position. I implore the Minister and the Government to listen to our pleas on the matter. Eggborough is a major employer. The conversion project would secure 800 jobs, and potentially thousands more. The money is there, it is shovel-ready and the investment is in place. The fact that the project is losing out to others that do not even have finance or planning permission in place simply cannot be right. In fairness to the Department, I understand the desire to have a range of technologies, but we argue that that is what the contracts for difference regime is for. The projects that would replace Eggborough would not be on stream until 2019-20. There is another regime for them, but there is not for Eggborough. The FID enabling regime is it for Eggborough: it is the end. We really need action on this, perhaps through the Secretary of State using his reserve powers. If the regime is not right, as the Minister has consistently told us, let us look at the Secretary of State’s reserve powers, particularly those relating to the impact on generating capacity.
If this project does not go ahead, we have to be clear that we will be replacing it with a much more expensive form of technology. I support the development of our offshore wind sector through a different regime, and locally we have all been united—the Opposition Whip, the hon. Member for Scunthorpe, is nodding in agreement—in wanting to see the Humber develop as an offshore wind centre. We believe that we can do both. We should aim to do both, not only because of the number of jobs at stake, but because of the implications for consumers and how much they would be hit in the pocket. I hope that the Minister will listen again to our pleas on this subject. It is important not only locally, but from a national perspective.
Lilian Greenwood (Nottingham South) (Lab)
Over the past three months, I have repeatedly raised my concerns about the impact that the Government’s panicked changes to the energy company obligation are having in my constituency, and I make no apology for doing so again today. As we have already heard, the energy company obligation is not covered by the levy control framework, even though the framework’s stated purpose is to cap the cost of levy-funded schemes and ensure that the Department of Energy and Climate Change achieves its fuel poverty, energy and climate change goals in a way consistent with economic recovery and minimising the impact on consumer bills.
The Government claim to be making changes to the ECO precisely because they are concerned about the impact on energy bills. My worry is that they seem to be ignoring the devastating effect of the changes to the literally thousands of my constituents who live in cold, solid-wall homes, which are expensive to heat. The hon. Members for Truro and Falmouth (Sarah Newton), for Brigg and Goole (Andrew Percy) and for Angus (Mr Weir) spoke about the impact on their constituents in off-grid and rural locations. I want to talk about solid-wall properties in urban settings.
Nottingham’s Greener HousiNG scheme is a partnership between our social landlord Nottingham City Homes, experienced insulation contractor VolkerLaser, local energy efficiency charity Nottingham Energy Partnership, and local people. The scheme offered up to 4,500 households in Clifton in my constituency the opportunity to save hundreds of pounds a year on their energy bills, enjoy warmer homes and contribute to national targets for cutting carbon emissions.
The scheme offered external wall insulation at an affordable, fixed price, with residents paying a contribution of between £1,000 and £1,300. The remainder of the cost was provided by funding from British Gas under its energy company obligation. Our ECO-funded scheme was to be delivered in two phases, commencing in September last year and finishing in March 2015. It was planned that the insulation works would be rolled out street by street across the Clifton housing estate to council properties and privately owned homes alike.
The launch of phase 1 of the scheme in the north of Clifton in early September was received with real enthusiasm, and within weeks hundreds of residents had signed up. Clifton is a close-knit community. Built on green fields by the council in the early 1950s to address post-war Nottingham’s need for homes, the estate is a popular place to live and raise a family. Three quarters of the homes are now privately owned, as long-term residents have exercised their right to buy. Many of the original residents still live there, and often their children and grandchildren are nearby, so word about the scheme soon got round.
When residents saw how good the insulation looked and heard about the difference it made to both bills and comfort, they started to get in touch from across the whole of the estate even though the publicity had only gone out in the phase 1 area. In total, there were about 330 council homes and a potential 1,100 private homes in phase 1 and a further 900 council homes and about 2,500 private homes in phase 2. By the end of November, more than 90% of council tenants had agreed to have the work done and there was 65% take-up among the private sector properties, with 729 private residents or landlords having signed up and paid their contribution towards getting the work done. A further 352 private owners had signed up and paid from the phase 2 area of Clifton South. Dozens of the owner-occupiers had also spent thousands of pounds installing new double-glazed windows or other preparatory work to maximise the benefits to their homes once the insulation was applied. In many cases, people had spent their savings or borrowed money to fund that work.
On 1 December, I was in Clifton chatting to residents on Farnborough road and Sturgeon avenue, some of the first streets where work had begun as part of the scheme. The feedback was incredible: people told me that their homes were warm for the first time ever. They were saving money. Many people on the estate are on low incomes so use prepayment cards to manage their gas and electricity bills. They immediately saw a difference in their household budgets and were really proud of the improved appearance of their homes and the neighbourhood. People waiting for the work told me how much they were looking forward to it starting. Some even told me what colour they had chosen for the render.
It was all going so well, but the very next day the Energy Secretary came to the House and announced a panicked change to the energy company obligation—a levy that was introduced by his Government and which underpinned Clifton’s Greener HousiNG scheme. He was under pressure: the big energy companies, in turn, were announcing price rises of up to 10%. He had no policy to counter Labour’s popular promise to freeze prices until 2017 and reform the energy sector. However, rather than take on the big six and tackle their overcharging, he gave in to them, did exactly what they wanted and announced that he was going to cut the ECO—a Government levy that makes up about 3.5% of the typical annual energy bill.
It seemed obvious to me that that change would put my constituents’ insulation scheme at risk. I voiced my fears and asked the Energy Secretary to guarantee to protect our scheme and its fuel-poor residents in hard-to-treat homes. He told me that as a Nottingham lad who had visited our city to see some of its successful insulation work, he agreed with me and went on to say:
“We must ensure that communities around the country are benefiting”.—[Official Report, 2 December 2013; Vol. 571, c. 633.]
He also said that he was happy to look at the case. Following that reassuring reply, I wrote to him reiterating my concerns. I am sorry to say that I have yet to receive a reply to my letter.
At the autumn statement on 5 December I tried again. The Chancellor dismissed the concerns of Clifton residents, including my 85-year-old constituent Ennis Peck, whose home may no longer be insulated under the scheme, telling me that energy bills would come down by £50. Of course, energy bills went up in January by an average of £60 and Ennis and many other constituents now stand to lose out both on warmer homes and on savings of £300 to £400 a year on their bills.
Our worst fears were confirmed on 8 January when British Gas gave 90 days’ notice that it was terminating its involvement in the Greener HousiNG scheme. It said:
“In light of the Government’s proposed changes to the ECO, it was necessary for us to review our current ECO contracts. These changes mean we can no longer fund some projects and unfortunately this is the case with our planned programme with VolkerLaser and Nottingham City Homes.”
Therefore, as a direct result of the Energy Secretary’s policy shift, thousands of my constituents stand to lose out.
Partners in the scheme are doing all they can to complete as much of the planned insulation work as possible for those who had signed up and paid their contribution, but the 9 April deadline is fast approaching. Although we hope that more than 1,000 homes in Clifton will be better insulated next winter, a further 3,000 Clifton families will be left in the cold. More than 20,000 households in solid-wall homes across Lenton Abbey, Wollaton Park, Aspley and other parts of Nottingham, who had hoped to benefit from the roll-out of the levy-funded Greener HousiNG scheme to their areas, are in a similar position.
Hundreds of local people employed to carry out the assessments and organise and install the insulation find that their jobs are gone or at risk, including eight new apprentices. A further 12 local unemployed young people who were due to start year-long apprenticeships leading to national vocational qualifications have been left in limbo. Their opportunity for green jobs in what should be a growth industry has been snatched away.
I want to the give the last word about the impact of the Government’s green levy changes to my Clifton constituents. Their stories convey more powerfully than I ever could why Ministers have dealt with changes to levies on energy bills in the wrong way. Mr and Mrs Rennie of Bainton grove told me:
“We signed up for the insulation last November. Due to lack of funds we chose the loan from the Credit Union to fund it. As advised by Nottingham Energy Partnership we undertook the replacement of our drainage pipes/guttering/soffits and fascias. We also had our rotten back door removed and a window put in place. We had the work done in December because we were told it would be January when the insulation work would start. The builder left the adequate gap in the fascia boards so the insulation would just fit in. The replacement wall beneath the new window was not rendered because it would all be covered by the insulation. We spent the last of our savings having this work done.
The main reason for us having the insulation is the damp which is especially bad in the front facing rooms of our house…We have water running down our walls, black mould growing, the paint bubbles off the walls. As well as this looking cosmetically bad it is not good for my wife’s health. Marie has multiple sclerosis and it’s important to keep warm and comfortable due to temperature sensitivity.
We are deeply upset and angry about this situation. As the weeks go by we are becoming more and more worried which is adversely affecting my wife’s health. She does not need this added stress!
If we do not get the insulation we have spent two thousand pounds we really could have done without…What do we do now? Please help us”.
The importance of the scheme for those with health problems is a recurring theme in letters from my constituents of all ages, but older and disabled residents are of course particularly susceptible to the cold. A constituent on Swansdowne drive wrote that
“we were hoping for a lot cheaper fuel bills and to be a lot warmer as these houses are made of concrete which holds the cold. We get a lot of condensation which is bad for our health. My husband is a poorly man and my son suffers from asthma and the damp doesn’t help.”
Arthur from Bainton grove, who is one of Clifton’s older residents, was looking forward to affordable warmth. One line in his letter—
“I’m a 76 year old man sitting with one bar on the fire”—
paints a vivid picture. Another of my constituents, who lives on Dovenby road, spends a lot of time in the house. She is 80 years old and lives on her own. She feels especially let down because all her bills are from British Gas, and she signed up at the launch meeting on the very first day of the scheme. Cheryl wrote on behalf of her mum, who lives on Wrenthorpe vale:
“Mum is 77 years old and has early stage Alzheimer’s. Being in most of the day she has the heating on most of the time. It has only recently been installed. Her bills have gone up phenomenally as the house, being concrete, is very cold. The difference to her heating bills and quality of life will be substantial. It’s all very disappointing.”
Of course, not just pensioners are affected, although they are particularly vulnerable to the cold and often face the most severe fuel poverty, which the levies are meant to help with. There are also problems for low-income families, such as my constituent on Colleymoor Leys lane who says:
“I am trying everything to heat my daughter’s bedroom. I have lined it with thermal wallpaper but it is still like an icebox. I cannot afford to keep the heating on and have to add layers to her and put a hot water bottle in with her and she’s only 3 years old. This is what I have been waiting for ever since I purchased this house in 2006. To have this stopped would be catastrophic. Please let my house have this. It will also help with my suspected rheumatoid arthritis. My daughter and I need this insulation urgently as it adds to her eczema due to the cold”.
The health of her children is also a concern for Carol who lives on Farnborough road. She says:
“I have 3 children living in my house. Myself and my 7 year old have asthma. The walls are damp and black and it smells in the rooms. I am spending money on heating up the house rather than buying food for my children. I am a single parent working and paying bills to get a loan to pay for this insulation. It’s killing me to have to get a loan, but for my health and my kids’ health I have to get it done. We’re living in 2014—things should be better now.”
Carol is right: it should be better than this. That is why Labour is prepared to protect consumers from excessive bills, reset the market and continue to invest in energy efficiency and measures to help those facing fuel poverty and the ever-rising cost of living.
The need for tough action on prices is very clear from the letter I received from a constituent who says:
“I was looking forward to being able to have more control of my heating costs in these trying financial times. As I approach retirement on a fixed income the spiralling energy bills are a constant concern”.
My constituent from Foxearth avenue speaks for many people when he says:
“British Gas should have been made to honour their commitment, they make enough profit”.
Three months on from the Energy Secretary’s announcement, we still have not had the consultation on his energy company obligation changes, and we have not seen any impact assessment. I know the impact that his changes are having in my constituency right now, and my constituents know what impact they are having. Action to tackle rising energy bills is vital, but the changes to green levies announced last year are not the way to go about it.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
I thank the hon. Member for South Suffolk (Mr Yeo) and his Committee for their report on parliamentary oversight of the levy control framework. It has been an important underpinning to this debate, and many of the issues it raises have been mentioned by Committee members and other hon. Members who have spoken. I hope that the Minister, if I give him enough time, can respond to those points before we conclude the debate. I am sure that he has paid attention to, and will want to respond to, the concerns raised by those who have spoken, and to the reflections of wider concerns expressed in recent months by several bodies and individuals, notably the National Audit Office. We have heard a refrain from some Members about the costs of so-called green levies. However, this has been a constructive debate and the more misleading aspects have not taken up much of our discussion.
A number of Members, including my hon. Friend the Member for Glasgow North West (John Robertson) at the start of the debate, spoke about the scale of the levies as a proportion of consumers’ energy bills. He said that more than half the cost of the levies goes to support pensioners and people on low incomes who need help to pay their energy bills.
My hon. Friend the Member for Nottingham South (Lilian Greenwood) has just described powerfully the immediate impact that the changes to the ECO scheme have had. She rightly said that we are yet to see an impact assessment from the Government. I wonder whether the Minister will enlighten us on when we will see the impact assessment of those changes, which were announced three months ago.
It is important to reiterate that that help focuses on improving energy efficiency, which can help to reduce consumption and minimise increases in bills. I would expect most hon. Members, whether they are here this evening or not, to sign up to that as a common-sense proposition. The housing stock in the UK is among the most energy inefficient. Much of the stock in the private rented sector, which has many of the poorest tenants, is the most inefficient of all. Improving efficiency is a sensible step, to help keep people warm and to ensure that we are not just heating the streets outside the windows and the air above the roofs. It also has the positive economic benefits of creating jobs and controlling the amount of generating capacity we need to invest in, which I hope will be well recognised.
Members will be aware that levies have been applied to bills for various schemes. When the Government introduced the ECO scheme, the enthusiastic Minister of State at the Department of Energy and Climate Change, the right hon. Member for Bexhill and Battle (Gregory Barker) proclaimed it to be “transformational”. So transformational has it been that it has led to schemes, such as the one in Nottingham that we have just heard about, being abandoned. He has presented the cutting and spreading over time of ECO as though it is extending the scheme. That feat of verbal dexterity has not been surpassed in this debate so far.
The number of contributions from hon. Members from all parts of the House this evening has demonstrated the level of interest in and concern about these issues. My hon. Friend the Member for Glasgow North West, who has a strong, consistent and unrivalled record of standing up for the fuel-poor in his constituency, in Scotland and across the UK, set out powerfully the way in which some people have used the debate over levies as a diversionary tactic to distract attention away from the need for reform in the retail and wholesale energy markets. I think that I heard him say that he is now convinced by the case for reform that is being set out from the Opposition Front Bench. I take that as a gain. I am sure that he will support our proposals in future.
The hon. Member for Southport (John Pugh) highlighted concerns about the delivery of aspects of the ECO scheme, which was introduced by this Government, and the impact on his constituents and businesses that are involved in replacing boilers.
My hon. Friend the Member for Southampton, Test (Dr Whitehead), who is a distinguished and long-serving member of the Energy and Climate Change Committee, underlined in his usual thorough and comprehensive way which levies are included and are not included in the levy control framework. I got the sense that he anticipates with keenness the forthcoming secondary legislation on the Energy Act 2013, which I hope we will see shortly. Indeed, I think he anticipates it almost as keenly as I do.
The hon. Member for Truro and Falmouth (Sarah Newton) highlighted the importance of energy security and a balanced energy mix, given the impact of geopolitical events on the price of imported energy. She also referred to the potential of wave and tidal energy in her constituency and throughout the south-west more widely. Last week, I was fortunate to be in Belfast to speak at RenewableUK’s wave and tidal energy conference and had the chance to meet and to speak to representatives of companies, universities and other bodies in her area. The local enterprise partnerships in the area have joined up to create almost a regional development agency, after the RDAs were abolished, to ensure that they get the best possible benefit from that huge energy potential.
Sarah Newton
The Government created the South West Marine Energy Park. The hon. Gentleman is right to say that the LEPs joined together to enable them to benefit from that very good Government initiative.
Tom Greatrex
I was very impressed by what I saw and heard from people at the conference in Belfast last week. The hon. Lady referred to the impact of the announcement on strike prices in the marine energy and wave and tidal sector. I am sure she is also aware that we are talking about nascent technologies, which could be a significant contributor in the 2020s. I hope she gets to the event that my hon. Friend the Member for Southampton, Test reminded her is happening tomorrow, because I am sure that others will be there who will be able to reiterate these points. It is also important, particularly for those technologies, that there is a signal beyond 2020.
The Minister seemed puzzled by the suggestion that an indication of the size of levy control framework beyond 2020 might be appropriate, but a 2030 de- carbonisation target would be appropriate. I am sure I need not remind the hon. Lady that that is supported by all parties in the House, other than hers.
Jim Shannon (Strangford) (DUP)
When the hon. Gentleman was in Belfast last week, did he have an opportunity to speak to anyone from the Northern Ireland Assembly about the role of the regulator in Northern Ireland who can have some control over energy prices in Northern Ireland? If he had such a discussion, has he been able to raise it with the Minister, and do the Opposition intend to give more power to the regulator so that prices for consumers can be reduced?
Tom Greatrex
I thank the hon. Gentleman for his intervention. I did not speak to any Assembly Members last week because I was there on Thursday when, as the hon. Gentleman will be aware, there were significant issues of immediate and pressing concern to Assembly Members and many others. Some Assembly Members who were due to be at the conference were unable to attend, for understandable reasons. However, I had the opportunity to talk to some players in the Northern Irish and Irish markets about the role of the regulators there, and I will send the hon. Gentleman a copy of our Green Paper so that he can see our proposals for a reformed and refocused regulator to ensure that there is a better balance in our regulatory regime.
The hon. Member for Southport said he had learned not to talk about estimates during estimates day debates. We had a master-class in that from the hon. Member for Angus (Mr Weir), who made a wide-ranging contribution on a range of energy policy issues, many of which were common ground to many of us, and we were able to agree with much of what he said. He touched on the impact on jobs and growth in his constituency from the renewables sector. As a fellow Scottish Member, I share his interest. Some engineering companies in my constituency are part of that supply chain, and I hope and anticipate that it will continue. The tone of this debate has been positive and thoughtful. The opportunity for my constituency and his to benefit most from opportunities in the renewables sector is underpinned by being part of the UK and the single energy market which we currently enjoy as a result.
The hon. Member for Brigg and Goole (Andrew Percy) touched on a number of issues, but most extensively those affecting Eggborough power station and his constituents. He may recall that I raised this issue at business questions just prior to Christmas, when I asked about the rumours that were circulating at that point. I think that the announcement in which the decision was confirmed was made on the day after the House went into recess. There are significant concerns about the way in which the FID-enabling process has progressed to date. I anticipate that further questions will be asked of the Government in relation not only to Eggborough but to other projects that slipped off the list and that had anticipated a different answer from the one that they got.
We are well aware of the proportion of the bills that consumers receive that is accounted for by levies within and outside the levy control framework: it is about 9% of the average bill, with the total amount added to bills being less than a third of the increase in bills since May 2010. It therefore does not stack up to attribute the majority of the increase in bills to levies, or green levies specifically. As the Minister is now well aware, 60% of the levies on bills have been introduced by the current Government since May 2010. I suspect that when he described the carbon price floor as an “absurd” waste of money and “assisted suicide”, he was not necessarily aware that it was a tax that had been introduced by his own Government. I am not sure whether those comments reflect his current view.
Apparently, as the Chancellor considers the Budget in the weeks ahead, he might reflect on the significant escalation of the additional element in bills. I join the Chair of the Select Committee and others who rightly noted that we in Parliament should be vigilant about the impact of levies on the bills of consumers and businesses. The oversight of a number of the arrangements relating to the levy control framework—which, as my hon. Friend the Member for Southampton, Test made clear, does not include all levies on bills—was a theme of several of our discussions in the Committee on the Energy Bill last year.
I ask the Minister to respond to some specific points. Will the capacity mechanism, and the demand-side options that will be considered as part of it, fall within the scope of the LCF in future? The Select Committee recommended that there should be a single annual report covering all DECC-funded schemes—those within and outside the levy control framework—to measure outcomes through spending, albeit that these moneys do not come from the consolidated fund. Have the Government looked into how that might be achieved, and does the Minister think it is a worthwhile exercise?
In its report on the operation of the LCF published in late November, the National Audit Office highlighted the failure of the joint Treasury and departmental governance board to link spending and outcomes in its deliberations. What assurance can the Minister provide that that will be rectified? The NAO also drew attention to schemes not covered by the framework and recommended that the Department should not only explain how it will control aggregate costs of consumer-funded schemes but elucidate on whether, together, those schemes are delivering what they are intended to deliver. What action do the Government intend to take in response to that?
The NAO returned to an issue that has been a matter of concern to many of us in recent months in relation to the allocation of contracts for difference within the LCF and the risk of breaching the cap if the wholesale price falls—another point made by the Chair of the Committee.
The NAO recommended that the Department and the Treasury should supplement published reporting on individual framework schemes by reporting routinely on levy-funded schemes. Has the Minister given that any consideration? The LCF is important, but it is also important that there is sufficient published information and accountability and that it should be taken with the same degree of seriousness with which this House views public spending from the consolidated fund. As the Chair of the Committee said, taxpayers and consumers are mostly the same people, and the impact falls on the same shoulders. The balance between the impact of the levies on consumers and the point of those levies has to be very carefully struck. The discussion about that balance can be better informed by a much stronger level of analysis being provided to this House for scrutiny.
I hope that the Minister will reflect on these important points to ensure that there is better, more thorough and more comprehensive parliamentary oversight of the levy control framework for the future, so that we can all be confident that it is delivering the policies that the Government are expecting it to deliver.
The Minister of State, Department of Energy and Climate Change (Michael Fallon)
We have had a good debate, and I thank the Energy and Climate Change Committee and the National Audit Office for their recent reports on the levy control framework. I have written today to the Chair of the Committee, my hon. Friend the Member for South Suffolk (Mr Yeo), in response to some of the specific questions raised in the Committee’s letter sent last Tuesday. I hope that all members of the Committee have received a copy of that response.
Before turning to some of the major questions raised about the estimates, not least by the hon. Member for Rutherglen and Hamilton West (Tom Greatrex), let me address some of the specific points made in the debate. My hon. Friend the Chair of the Committee asked about the levy control framework and whether the list of technologies was exhaustive. We have set out all the technologies that we consider should be supported at the moment up to 2018-19, although of course we cannot bind our successor—if there is one—and I do not rule out extending that support. He will see that we have put a support price for wave technology, tidal power and so on. He also asked for more details of the capacity mechanism. We are consulting on the exact operation of the capacity market and the auction, and he will receive more details about that shortly.
My hon. Friend asked about the position of carbon capture and storage in the levy control framework. The capital costs of carbon capture and storage—the £1 billion that the Government are committing to the two projects for which we have signed initial feed contracts—are not in the levy control framework because they are, of course, taxpayer funded. However, the operating costs will be covered through the framework. Finally, he asked me to speculate on the future movement of gas prices. There, I am afraid I cannot help him with any particular update or assumptions, and neither do I think that I would best respond to the debate by doing so.
The hon. Member for Glasgow North West (John Robertson) made important points about energy efficiency, and I do not think there is too much difference between the two sides of the House about the importance of those measures. He went on to attack the performance—indeed, the existence—of the big six. I did not hear him admit, however, that the big six were a creation of the previous Government, who seem to have started with 14 retail companies and ended up with the big six. He would have been on stronger ground if he had acknowledged the failure of the previous Government to do anything about increased concentration in the sector.
My hon. Friend the Member for Southport (John Pugh) made important points about the returns enjoyed by energy companies and the ECO, but his most important point was about the fuel poverty target and how, when we get the new target rolling, we should monitor it properly, account for its performance, and be sure to explain to those—including all the voluntary organisations that worked with us on the construction of a better focused target—how we are meeting it.
The hon. Member for Southampton, Test (Dr Whitehead) made a number of points about the estimates, which I will come to when I reply to the meat of the debate. He drew the House’s attention to the important inter-relationship between the carbon floor price and the levy control framework. He is right to remind us that any changes made to the carbon floor price will, of course, have implications for the levy control framework.
My hon. Friend the Member for Truro and Falmouth (Sarah Newton) referred to the strike prices for some of the newer technologies. I am glad that we were able to confirm those strike prices, which have been such a boost to renewable projects in her area. She went on to make some important points about our continuing work to improve the position of off-grid households. I certainly take her point that we perhaps ought to include some representation from Public Health England in our work. I will certainly reflect on that further, before I convene the next meeting of the ministerial round table in May.
The hon. Member for Angus (Mr Weir), in a lengthy speech, paid much attention to the extent of renewables support without confirming that more than a third of renewable support goes to Scotland, which has just 9% of the population. He would have been on stronger ground if he had referred to the extent of support that comes from outside Scotland; not just from England, but from taxpayers in Northern Ireland and in Wales, too. More than one third of all our support for renewables ends up in Scotland, which has just 9% of the population.
My hon. Friend the Member for Brigg and Goole (Andrew Percy) raised again the position of Eggborough. I do not think, because he champions the cause of Eggborough so well, that he fully appreciates that some 16 projects came forward under our intermediate regime. They all involve enormous taxpayer support, so it would not have been possible for taxpayers to support all 16 projects. We are taking nine projects forward on the basis—I have to correct him slightly—that all are ready to sign this month: all have finance in place this month. I am delighted to confirm that two are biomass conversions—Drax, right next door to him, and Lynemouth in Northumberland—so we are not neglecting the cause of biomass conversion. It is not right to say that a project not taken forward under the FID enabling process has, in the phrase I think was used the hon. Member for Rutherglen and Hamilton West, slipped off the list. We are not able to give taxpayer support to every single renewable project that came forward for the intermediate regime. Those not afforded under the regime will still, of course, have the option of applying under the existing renewables obligation or the forthcoming contract for difference.
The hon. Member for Nottingham South (Lilian Greenwood) raised one important point in particular on the Clifton scheme in her constituency, which, she suggested to the House—I have no reason to doubt her—is a victim of the changes taking place in the ECO arrangements. She alleged that she had not had a reply from the Secretary of State. If that is true, we will certainly investigate and make sure that that point is chased up. I will, of course, write to her on the particular issue facing her scheme in Clifton and see exactly what the situation is. It is not true to say, by the way, that all six of the big six cheered when the announcements were made on the extra two years for the ECO. Some of those who had already committed to the work were not at all pleased that their competitors were being given further time, but I will look into the specific points mentioned.
On the specifics of the debate, as the NAO has acknowledged, the levy control framework is a valuable tool in supporting control of the costs to consumers as we pursue our energy policy objectives. The framework helps to drive investment in our energy sector. It helps to create jobs and growth, and, of course, takes us to a leaner, more secure energy supply. However, I recognise that proper oversight of the framework is important. Those who pay the bills, our constituents, need to know that Parliament is looking out for their interests in scrutinising this expenditure.
Let us look first at why we need the levy control framework. We need to secure an energy future at a cost that we can afford, and that is a huge task. One fifth of our power stations will go off line in the next six or so years. By 2030, if nothing else changes, we shall be importing 70% of our gas. Eight of the nine existing nuclear stations are scheduled to have closed by the time Hinkley Point C opens. However, in the same framework, energy demand may have doubled by 2050. The generation mix will have to tip significantly towards low carbon if we are to meet our legally binding climate change targets.
We are working to reform our energy sector to unlock investment now, and to create a framework for the delivery of a secure energy future. Nearly £40 billion had already been invested in the electricity sector between the beginning of 2010 and the middle of last year. More than 16 GW of new capacity has been brought on to the system, including five new gas plants, and a sixth is under construction. Two huge offshore wind farms opened last year, and we are seeing a very healthy pipeline in key technologies, including four more large offshore wind projects which are under construction. We remain No.1 in the world for offshore wind, and it is the work of the Government and, indeed, the work of the House that has enabled that to happen.
The Energy Bill received Royal Assent last December. That significant milestone laid the groundwork for the delivery of electricity market reform and sent a strong message to investors and industry about the cross-party agreement on the fundamentals of energy policy and the framework that we are establishing. The levy control framework is a key part of that. It provides certainty for investors, helps to control the costs of energy, and helps to ensure that the Government are held to account.
Last Monday I co-chaired the Offshore Wind Industry Council, which consists of many chief executives from different companies that are investing in the United Kingdom. They told me that the stability provided by the levy control framework had been an important factor in their decision to continue to invest in the UK. That is one of the reasons why the figures from Bloomberg show that the average annual investment in renewables has more than doubled in the current Parliament, from £3 billion to nearly £7 billion.
The provision of low-cost, low-carbon energy, improved energy security and the tackling of fuel poverty are all outcomes that the levy control framework helps to deliver, but it is obviously important for the impact on bills to be scrutinised closely and carefully as we pursue those goals. My Department is acutely aware of the pressure that consumers are facing, which is why we took action to reduce bills by an average of £50. The Opposition have a different approach, and we may disagree on the merits of that approach, but I think that Members on both sides of the House can agree that the cost of energy matters deeply to our constituents. It is therefore important for us to have an informed debate about it.
Let me say something about the work that we are doing to increase transparency. In March last year my Department published the prices and bills report, which showed the impact that our policies have had on bills in a clear and transparent way. The annual energy statement sets out our priorities, and an assessment of our progress in meeting our ambitious targets. In addition, Ofgem reports regularly on the costs and impact of each of our existing schemes.
During this evening’s debate, we have heard much about the coverage of the levy control framework. I do not want the purpose of the framework to be misinterpreted. It is a formal part of the public expenditure control framework. We have controls for departmental expenditure and annual managed expenditure budgets, and we also need controls for levies. However, the public expenditure control framework does just that: it exists to control public expenditure. Policies such as the energy company obligation are regulations, not public expenditure, so not all policies are considered public expenditure. The ECO is regulatory in nature and so lies outside the existing departmental expenditure limits and annually managed expenditure budget frameworks, but the fact that some consumer-funded policies sit outside the levy control framework does not diminish the oversight they should, and do, receive. Parliament has debated and passed primary and secondary legislation for all our major policies. Impact assessments that support those debates set out the full economic rationale for the action we propose to take.
We also take steps to monitor the costs of these policies and put that information into the public domain. On the ECO, for example, we published an assessment of the costs of compliance. Our bills and prices report takes account of the costs and benefits of all significant consumer-funded policy, including transmission costs, the ECO and smart meters.
However, we are not able to include three of our levies—the renewables obligation, the feed-in tariffs and the warm home discount—in our annual accounts. To those who have asked why not, the answer is that the Comptroller and Auditor General rightly requires Departments to meet international financial reporting standards. For the renewables obligation, feed-in tariffs and the warm home discount, revenue does not flow through the Exchequer. Instead, industry collects the money directly from consumers and industry controls how those funds are used to meet the regulatory requirements. It follows therefore that the associated expenditure also cannot be included in my Department’s accounts and if it was, the head of the National Audit Office would be forced to quality it. The Government do not gain additional funds through these levies to spend at their discretion.
That is a fairly simplistic explanation of a technical accounting issue and I am sure hon. Members appreciate that the time available tonight does not permit me to go through the detail of international accountancy regulations.
I have asked my officials to work with Treasury officials and the NAO to try to overcome this issue to maintain a clear line of sight, but as the Chief Secretary to the Treasury set out in his letter to the Liaison Committee in November, we have not been able to find a way through this for the existing levy schemes. However, I can assure the House that revenue and expenditure for contracts for difference and for the capacity mechanism— a point raised earlier—will flow through public sector bodies, and they will therefore be included in my Department’s account and will form part of the estimate.
John Robertson
Does the Minister have any idea how much money we are talking about that is not being shown?
Michael Fallon
I think at this stage of the debate the hon. Gentleman will probably allow me to write to him about that as I do not have that figure at my fingertips. However, those are the three principal levies that are not included in the main estimates. As I have said, the revenue and expenditure for the CfDs and the capacity mechanism will be included in our account and will form part of the estimate.
So what we now need to do, working closely with Parliament, is find a satisfactory alternative for the existing schemes. The Committee’s report has provided a very useful contribution to this debate, and I am going to ask my officials to consider carefully the points that have been raised and I will also reflect the Committee’s points to the Chief Secretary to the Treasury when I next discuss this with him.
I also recognise the accountancy and constitutional challenges this issue presents. Notwithstanding these technical challenges, I would like to set out now my intentions for the future reporting of consumer-funded policies, which lie at the heart of the Select Committee’s concern. First, I can confirm that the Government will publish information on consumer-funded policies that covers actual expenditure and forecast expenditure, and that captures the progress we are making towards our policy ambitions. I agree that that information would benefit from a proportionate independent audit and from being formally presented to the House. It is my intention to publish this information annually. The Chief Secretary wrote to the Chairs of the relevant Committees on 5 November, suggesting that this information should be published no later than Ofgem’s report on the renewables obligation. That report is due in March next year, but we need to do better than that, which is why my officials will work with their counterparts in Her Majesty’s Treasury and the National Audit Office to bring that date forward.
I hope that has been helpful. As I have said, we have made some real progress in delivering the investment that this country needs in its new energy infrastructure. The levy control framework is an important part of that process, giving confidence and transparency to investors. But Parliament has an important role in scrutinising the Government of the day and their actions on behalf of our constituents, and I welcome that scrutiny. I hope that the improvements I have suggested to the House tonight will help Parliament in performing its role in doing exactly that.
Question deferred until tomorrow at Seven o’clock (Standing Order No. 54(4)).
Census (Kashmiri Ethnic Representation)
(10 years, 2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Simon Danczuk (Rochdale) (Lab)
I am extremely grateful finally to have this debate. As some may be aware, the Kashmiri ethnic representation question was first raised in 2007 by Baroness Nicholson in the other place. Seven years later, it is finally being debated in this Chamber. Various Kashmiri organisations have estimated that about one in four British Muslims are of Kashmiri origin—that is one quarter of the British Muslim population who live in our communities, pay taxes and contribute to our economy. But the true accuracy of that statistic can never be known, as there is no official documentation of their ethnicity on the census.
British Kashmiris play a major role in the social, political, cultural, economic and religious life of the United Kingdom. The Kashmiri people are proud, hard workers who have brought a taste of Kashmir to our cities and towns. We have three Members of the Commons of Kashmiri origin: the hon. Member for Gillingham and Rainham (Rehman Chishti); and my hon. Friends the Members for Birmingham, Ladywood (Shabana Mahmood) and for Birmingham, Perry Barr (Mr Mahmood). In addition, Kashmiris hold hundreds of positions as local councillors across the country and heavily influence more than 30 constituencies at election time. This is why it is distressing that as a result of not having a Kashmiri ethnicity category, a community that totals well over half a million people is left vulnerable—I would go as far as to say that this is an injustice.
I wish to focus on two consequences of ignoring Kashmiri ethnicity in the census: under-representation and deprivation. I am of the belief that British Kashmiris run the risk of being under-represented in a population that does not specify their ethnicity. In my constituency, the vast majority of people of Kashmiri origin live in the most deprived wards. They are therefore most likely to be under-represented in terms of higher educational attainment and most likely to be over-represented in terms of poor, overcrowded housing. I have heard from people in my constituency that unemployment in Kashmiri communities is extremely high, perhaps 60% to 70% in some areas. It is also the case that people in these communities are disproportionately likely to rely on state benefits and most likely to be extremely economically deprived. Evidence from the Joseph Rowntree Foundation supports those conclusions. Please note my emphasis on the phrase “most likely” because speculation is all that we can do at this point. Minister, there is a community of people in our constituencies who are suffering because their needs are disregarded and their identities are lost.
Let me take this opportunity to put it on the record that an incredible amount of hard work has been done by councillors of Kashmiri origin in my constituency. They have put in many hours trying to address the concerns that I have just outlined. Councillors Daalat Ali, Amna Mir, Aftab Hussain, Iftikhar Ahmed, Mohammad Zaman and Shah Wazir all do incredible work for their communities. The work is extremely demanding because of the challenges that those communities face.
In my weekly surgery, I carry out a large amount of immigration casework. I sometimes make a point of asking people where they are from—what is their ethnic origin. Some respond, “Bangladesh.” Some say, “Ukraine.” Others say, “Poland”, but most respond, “Pakistan.” I stop them and clarify, “Do you mean Kashmir?” Their faces light up. They are delighted that someone in the political system recognises the difference.
It is troubling that while the census forgets about Kashmiris, Kashmiris are being told that their ethnic identity is not valid. Many have an incredibly strong sense of ethnic identity. They do not want to be counted as Pakistani or Indian because that is not how they think of themselves. Is it right for us as a democratic society, built on the differences of the many, to help to strip away the identities of the few? Should we not be celebrating the diverse cultures and identities within our country? Since 1991, the number of ethnicities on the census has doubled. That reflects the growing diversity of our country and the economic opportunities available to people here.
Before the 2011 census, the Office for National Statistics tested more than 20 new ethnicities, of which two would be added to the census. The ONS decided that any additional ethnicities beyond its quota would lead to compromises in the layout of the census. It decided that Gypsy/Irish Traveller and Arab ethnicities deserved to be represented in the census.
We now know, because of inclusion in the census, that Gypsies and Irish Travellers experience huge levels of unemployment, poor health, and often have poor educational attainment, according to ONS figures. They have few qualifications and a significant portion of their young population is not actively searching for work. Such results may be frustrating to hear, but, at the very least, preparations can be made to address the problems. After all, is not the fundamental reason of a census to convert population statistics into efficient, beneficial services?
The British Kashmiri community, the population of which is estimated to be more than four times that of Gypsies and Irish Travellers, will not receive special benefits catered to their needs and, as a result, will continue on the path of deprivation. Perhaps the most pressing issue surrounding these services is the language barrier. People of Kashmiri origin are disproportionately likely to rely on various state and local authority services. We therefore need to make sure that an appropriate number of staff are able to speak Parahi. It is my belief that inclusion on the census will help to ensure that we can take such steps and therefore better co-ordinate our services.
The Kashmiri population in my constituency makes up a significant portion of the night-time economy work force as taxi-drivers, take-away operators and by working in other jobs with unsocial hours. Again, knowing this information in a more statistical way would allow better community engagement strategies to be developed. Improved community engagement from my own local authority and many like it could create vital links to economic and social opportunities, so that Kashmiris can achieve their fullest potential. We could also look at introducing education and integration programmes among Kashmiri communities, who are historically very tight-knit and sometimes hesitant to take outside assistance.
As well as looking at our own communities, we should also be aware of the development of Kashmir itself. The Department for International Development is very active in Kashmir and a large amount of UK aid money is spent there. I recently met people from the RSA—the Royal Society for the encouragement of Arts, Manufactures and Commerce—to discuss its Pakistan Calling project, aimed at engaging the British Pakistani diaspora with development issues in Pakistan. The efforts of such fantastic projects would be greatly assisted if we had proper information about the number of people of Kashmiri origin in our country.
Now, obviously, it is almost impossible to discuss Kashmir without mentioning the current disputed state of that region. I understand that neither the Indian nor Pakistani Governments might be overjoyed by the United Kingdom Government recognising the Kashmiri identity as valid, but I would just like to make this point: I am strongly of the view that we should not let our own domestic arrangements be dictated to us by a desire to keep other countries happy. I hope that the Minister shares this view.
To conclude, I would like to ask the Minister a number of questions. First, will he update the House on the preparations for the next census and whether the Government intend to hold one? Will he clarify whether they will consider adding new ethnicity categories and will Kashmiri be one of those considered? Finally, does he share my concerns about the challenges that face the Kashmiri community in this country, and does he agree that we need proper information if we are to meet these challenges?
If we continue to ignore the issues that people in this community face then it is not just they who will suffer but all British society. This seems a rather dramatic argument for what, at the end of the day, is simply a very small box on a very big form, but I really do feel that it would have important symbolic and practical value; practical, because it would allow us to gather more information on this important group and therefore target resources more effectively to meet their needs; and symbolic, because it would say to British Kashmiris that we accept them for who they are. It says to them that just because they are British does not mean they are not also Kashmiri.
The Minister for Civil Society (Mr Nick Hurd)
I sincerely congratulate the hon. Member for Rochdale (Simon Danczuk) on securing a debate that is arguably overdue. I endorse what he had to say about the important role that the Kashmiri population plays in this country. His speech, powerful as it was, educated me about some of the challenges that that community faces, as I would not know that from my constituency. I very much welcome the opportunity to respond and to report on how the Kashmiri community was recognised in the 2011 census and the current status of planning for the collection of census-type statistics in the future, which is the main thrust of his inquiry.
I should perhaps have prefaced my remarks by explaining that, as the census is a devolved matter in Scotland and Northern Ireland, I will restrict my response therefore solely to the context of the census in England and Wales, which is administered by the Office for National Statistics on behalf of the UK Statistics Authority. In my response, it may help if I summarise the position regarding the collection of information on Kashmiris in the 2011 census. As in the previous census, the 2011 census included a question on ethnic grouping that allowed people to record themselves as Kashmiri.
Mr Hurd
As in the previous census, the 2011 census included a question on ethnic groups that allowed people to record themselves as Kashmiri by using the write-in facility in each of the main ethnic groupings on the census questionnaire. The question was not intended to establish the ethnic composition of the population as it might be understood by, for example, sociologists, but to capture in a common-sense or pragmatic way information on the categories of persons who are likely to be the victims of racial inequality or discrimination.
There is, as the hon. Gentleman knows, a wide range of uses for ethnicity data collected in the census, including the opportunity to enable organisations to meet their statutory obligations on race relations and equal opportunities legislation. There is an element in the formulae for grant allocation by central and local government to inform policy development and monitoring, and to provide public bodies with a better understanding of the communities they serve and hence to inform public service provision.
The list of categories used to collect the ethnicity data was designed to enable the majority of the population to identify themselves in a manageable way. However, there is a practical limit to the number of separate tick box categories that can be included in any single ethnicity question. The question was already the longest on the questionnaire in the 2001 census, and consultation with users and communities during the planning of the 2011 census revealed a demand for yet more specific response categories to be included. In all, there were requests for about 20 new categories including Cornish, Gypsy/Irish Traveller, Arab, Sikh and, in particular, Kashmiri. The Office for National Statistics began consulting users in March 2005 on their requirements for the content of the census, with further consultations in 2006 and 2007 specifically on the topics of ethnicity, national identity, language and religion.
Four submissions of the 2,000 or more received during the 2005 consultation were from the Kashmiri community. Some 78 respondents of the 530 to the subsequent consultation in 2007 sought better information on the Kashmiri population. Of these, 20 were from local government service providers while the rest were from special interest groups and private individuals. The need for better information on Kashmiris was also raised by three attendees at ONS’s census open meetings in March 2007. The case for a Kashmiri tick box to be included in the 2011 census ethnic group question was considered carefully alongside the requests for all the other new categories—many more than could possibly be included on the census questionnaire.
With space for only two new tick boxes, ONS developed a set of principles by which requirements for the new categories could be assessed and prioritised. They covered the strength of need for the information; the lack of alternative sources of information; the clarity and quality of the information collected and acceptability to respondents; and comparability with the 2001 census data. The reasons most often cited for identifying Kashmiris as distinct from Pakistanis, for whom a tick box category was already provided, included, first, identity. Although, as the hon. Gentleman knows better than I do, Kashmiris may self-identify as Pakistani, that may not be their strongest or preferred choice; this is linked to the desire by some Kashmiris for a separate Kashmiri state.
The second reason was resource allocation and service delivery. Local authorities and other organisations may not distribute resources effectively among different parts of the self-reported Pakistani population. Organisations may make assumptions about the need for language translation provision for this population—for example, that Urdu is the only language required for those with low English language proficiency. Thirdly, monitoring inequalities was a consideration. There is a suggestion that Kashmiris may be more disadvantaged than other Pakistanis as a result of their rural background. Their experiences may be masked by those of other Pakistanis when they are combined in the same ethnic grouping. That is the core reason often cited for identifying Kashmiris as distinct from Pakistanis.
The case for a Kashmiri tick box scored well in the ONS prioritisation exercise, but not as well as the two new ethnic group categories that were eventually included: Gypsy/Irish Traveller and Arab. Moreover, there were other ethnic groups of the Indian subcontinent—Sikh, in particular—that respondents would have expected to see if a Kashmiri category had been included. Introducing further tick boxes on the census questionnaire would have meant removing something else or making unacceptable compromises with questionnaire layout and the consequent quality of the information collected.
Following representations and meetings—in particular a meeting at the ONS on 1 May 2009 between senior ONS officials and Kashmiri representatives, including the co-ordinator of the Kashmir national identity campaign, who I understand is one of the hon. Gentleman’s constituents—a Kashmiri research project was undertaken in 2009. A subsequent report was published, with which the hon. Gentleman is no doubt familiar, given his role as treasurer of the all-party group on Kashmir. It is available on the ONS website, the details of which I can provide to him later, should he so wish.
The conclusions of the research project were that the addition of a Kashmiri tick box increased the likelihood of multiple ticking, because people could consider themselves to be Kashmiri and Pakistani, Indian, or some other ethnic group; and the overall rate of multiple response in a postal test had been low, but focus groups and interviews had revealed that the addition of a Kashmiri tick box might cause confusion among respondents over which box to tick.
Many of the arguments for information on Kashmiris are related to the need to ensure that services are provided in the appropriate languages, a point the hon. Gentleman made. Kashmiris speak more than one language from the Kashmir region, and a key concern was that service delivery organisations assume that the only language needed for Pakistanis is Urdu. However, the ONS argued that that information would be better collected from the question on main language that it proposed including in the 2011 census for the first time. That would identify those people whose main language is Pahari or Mirpuri. Service providers would then have the information required to identify the services needed to support the Kashmiri people who would otherwise be disadvantaged because of language difficulties.
Taken as a whole, the programme of consultation with the Kashmiri community, whether through formal advisory groups, public and invited meetings, or the ONS’s innovative community liaison programme, successfully contributed in the end to a high level of support for, and participation in, the census. Although some representatives of the community actively opposed the census, even in the latter stages of the consultation, the community eventually ran its own self-funded publicity campaign to urge Kashmiris to “be counted and get recognised” by using the write-in option on the questionnaire.
The lack of a specific Kashmiri tick box has not prevented information about the Kashmiri community from being available from the 2011 census results. Write-in responses to the ethnic group question were coded according to the main ethnic grouping under which they were recorded, as was done following the 2001 census, and the results have been published. As the hon. Gentleman is no doubt aware, some 25,265 individuals identified themselves as Kashmiri in that way. Almost all wrote in their response under the main “Asian/Asian British” ethnic group, but a small minority identified themselves among some of the other main groups— 125 under the “Mixed/multiple ethnic” group, 105 under the “White” group, and 352 under the “Other” group. The total figure compares with the 23,191 who reported themselves as Kashmiri in the 2001 census.
The hon. Gentleman asked how information on Kashmiris will be collected in any future census. I have to advise him that it is too early to know whether there will be another census in England and Wales in the form that we have previously known, or what questions might be asked, but he can be reassured that any proposals for a question on ethnicity in any future census will be based on a comprehensive programme of consultation and testing to ensure that it will meet users’ requirements and be acceptable and understandable to respondents. He will already be aware of that from the ONS’s answer to his recent parliamentary question.
The UK Statistics Authority established the Beyond 2011 programme in April 2011 to consider the best way of meeting future requirements for population and socio-demographic statistics in England and Wales by assessing the relative merits of a number of alternative approaches. Over the last three years the programme has undertaken extensive research to determine the best way of providing population statistics in future. The results of that work show that there are two potentially viable approaches to census taking in future: once a decade, like that conducted in 2011, but primarily online; and using existing administrative data and compulsory annual surveys. The issues and implications associated with the findings, including descriptions of each approach and its strengths, weaknesses, risks and opportunities, as well as information on the statistics that each method provides, formed the basis for a major public consultation in the latter part of 2013. One response has been received from a private individual that referred to the recognition of people with a Kashmiri heritage, but it did not specifically call for a Kashmiri tick box in the ethnic group question in the next census.
The results of the consultation are being analysed and a full report will be published in spring 2014. It is expected that the national statistician and the UK Statistics Authority will make a recommendation to the Government based on a comprehensive assessment of the research undertaken. It will then be for the Government and Parliament to agree the arrangements for conducting any future census in England and Wales on the basis of that recommendation.
I should stress to the hon. Gentleman that at this point no decisions have been made on the topics or questions that could be considered for any future census. Consultation on the 2011 census questions did not start until 2005, so whatever the form of the next census, the ONS would not expect to start consultations on its content until next year at the earliest. However, in securing this debate and in his speech, the hon. Gentleman has played an important role in ensuring that the voice of the Kashmiri community will be heard loud and clear in that process.
Question put and agreed to.