Lords Grand Committee
Wednesday 10th June 2026
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16:15
Speaker 1
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Speaker 1
Scientific Procedures Act 1986. Amendment regulations, 2026. My Lords, these regulations form part of the government's wider programme of reviewing retained EU law to ensure that the statute book operates clearly and effectively with the UK's domestic framework following the EU exit. The regulations ensure that the UK's high standards for the use of animals in scientific research continue to operate clearly and effectively in domestic law. The instrument before us today makes some technical amendments to retained EU law relating to the use of animals in scientific procedures.
Its purpose is straightforward, which is to preserve the existing framework, maintain legal clarity and ensure that the law remains operable and enforceable in domestic law. Um, I want to be clear at the outset, if I may, that the regulations do not weaken animal welfare protections. They create new permissions for animal tests or create new permissions for animal testing, or reduce regulatory scrutiny. The UK strong protections remain in place. The UK continues to operate one of the most robust regulatory systems in the world, and under the Animals Scientific Procedures Act 1986.
This is a really important. Under that framework, animals may only be used where there is no viable alternative. The number of animals used must be kept to the minimum necessary and. The most refined methods must be used to minimize harm. These requirements are enforced through a comprehensive system of licensing, audit and enforcement by the Home Office. Animals in Science Regulation Unit. Now, alongside the Act, animal welfare standards are supported by the Code of Practice for the Housing and Care of animals bred, supplied or used for scientific purposes.
That code sets out minimum standards that licensing establishments must meet for the care and accommodation of animals used in scientific work. Compliance with the code is a condition of holding a licence, and these regulations ensure the code remains legally effective within the UK framework, so that the same high standards continue to apply. Now I am very much aware, my Lords, that the use of animals in science attracts significant public interest, and it is right that it is subject to robust scrutiny, given the important welfare and ethical conditions considerations involved.
The government's position on animal testing is clear. We are committed to working towards a long term vision where animal testing is replaced in all but exceptional circumstances. In November, 25 Noble Lords will know we published the Replacing Animals in Science Strategy, backed by £75 million of investment to accelerate the development, validation and uptake of non-animal methods. The strategy includes commitments to establish a UK centre for the validation of alternative methods, create a plea preclinical trans national model hub and expand the challenge led innovation for alternative methods.
At the same time, there remains an immediate need for the use of animals in some areas of scientific research and testing to protect human and animal health, and indeed the environment. And when we rely on medicines and medical technologies, we rely on rigorous safety testing that in some cases still requires the use of animals where animals must still be used. It is essential that they are protected by a rigorous and enforceable regulatory system. This is, my Lords, exactly what these regulations do. They preserve existing protections through a framework designed to minimize harm, drive continuous improvement and ensure that animal research is conducted responsibly and only when it is truly necessary.
These regulations provide legal clarity following the EU exit to ensure that the UK's high protection and welfare standards continue to be upheld, and I therefore commend the sea to the committee.
Its purpose is straightforward, which is to preserve the existing framework, maintain legal clarity and ensure that the law remains operable and enforceable in domestic law. Um, I want to be clear at the outset, if I may, that the regulations do not weaken animal welfare protections. They create new permissions for animal tests or create new permissions for animal testing, or reduce regulatory scrutiny. The UK strong protections remain in place. The UK continues to operate one of the most robust regulatory systems in the world, and under the Animals Scientific Procedures Act 1986.
This is a really important. Under that framework, animals may only be used where there is no viable alternative. The number of animals used must be kept to the minimum necessary and. The most refined methods must be used to minimize harm. These requirements are enforced through a comprehensive system of licensing, audit and enforcement by the Home Office. Animals in Science Regulation Unit. Now, alongside the Act, animal welfare standards are supported by the Code of Practice for the Housing and Care of animals bred, supplied or used for scientific purposes.
That code sets out minimum standards that licensing establishments must meet for the care and accommodation of animals used in scientific work. Compliance with the code is a condition of holding a licence, and these regulations ensure the code remains legally effective within the UK framework, so that the same high standards continue to apply. Now I am very much aware, my Lords, that the use of animals in science attracts significant public interest, and it is right that it is subject to robust scrutiny, given the important welfare and ethical conditions considerations involved.
The government's position on animal testing is clear. We are committed to working towards a long term vision where animal testing is replaced in all but exceptional circumstances. In November, 25 Noble Lords will know we published the Replacing Animals in Science Strategy, backed by £75 million of investment to accelerate the development, validation and uptake of non-animal methods. The strategy includes commitments to establish a UK centre for the validation of alternative methods, create a plea preclinical trans national model hub and expand the challenge led innovation for alternative methods.
At the same time, there remains an immediate need for the use of animals in some areas of scientific research and testing to protect human and animal health, and indeed the environment. And when we rely on medicines and medical technologies, we rely on rigorous safety testing that in some cases still requires the use of animals where animals must still be used. It is essential that they are protected by a rigorous and enforceable regulatory system. This is, my Lords, exactly what these regulations do. They preserve existing protections through a framework designed to minimize harm, drive continuous improvement and ensure that animal research is conducted responsibly and only when it is truly necessary.
These regulations provide legal clarity following the EU exit to ensure that the UK's high protection and welfare standards continue to be upheld, and I therefore commend the sea to the committee.
16:19
16:19
Speaker 3
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Speaker 3
My Lords, I rise to say a few brief words about this statutory instrument, and to commend my noble friend the Minister, for the way in which he has set it out, and its purpose. And my gaze wanders to our colleague from Hansard, because it has occurred to me that since my re-introduction to the House a week ago today, after a few days absence, my remarks might be considered a maiden speech. And I want to reassure the committee that it's no such thing. I am just here to continue my work, much of which has involved actively promoting science at every opportunity, and also to give voice to the many scientific organisations outside this House whose advice and assistance is so valuable and welcome.
Now, I doubt there's any member of the committee here today who wants to see animal testing and research, if it can be avoided, and the government are rightly committed to ending it. But for the time being, animal research remains an essential component of scientific and biomedical research, and it helps ensure that potential new drugs, vaccines and medicines are safe and effective. As I understand it, for example, certain anaesthetics have only been made possible by research on animals and who among us here today has not benefited at one time or another from an anaesthetic?And the research that's done is fundamental to advancing our understanding of complex biological systems and disease mechanisms.
And it plays an important role in safeguarding human, animal and environmental health. It's also critical to responding to health emergencies, including any future pandemic, which none of us wants to see, but which remains one of the most significant threats to our national security and indeed, our very existence. And scientific advances continue to be made by the life sciences community. Indeed, members may have heard the news a week ago from Cambridge that a research group there have developed a vaccine that might be applicable to a whole category of viruses, with the use for the first time of artificial intelligence.
And this could be a real breakthrough. And like all new technologies, it can be used for good and sometimes not. But at the same time, we must recognise that alternatives to animal testing are not yet mature enough in complexity and application to replace whole animal models. So we must continue to support a balanced research ecosystem that enables both high quality animal studies and the responsible development of animal methods. Now, when this sea was laid, when I saw it, I contacted the Royal Society of Biology for their advice, and I should declare an interest here because I work for the Royal Society of Biology before I was elected to this House, and the society confirms.
My noble friend has set out that this statutory instrument is essentially a tidying up of the existing standards. It represents a change that will help the sector to propose improvements in practice, and for the regulator to accept them and help embed them as expected standards across the research community. The sea related to minor amendments to the Code of Practice for the care and accommodation of animals bred, supplied or used for scientific purposes, such as mandatory standards of care and housing, etc.. So these amendments themselves largely relate to.
My noble friend has said to removing references to the EU which are no longer valid, as well as a few minor clarifications. And the amendments relate to the first two thirds of the code of practice. The final third of the Code of Practice, which relates to non-mandatory guidance and leading practice, has been removed as the Home Office will be revising this more heavily at a later date. My noble friend may be able to confirm it, and will take into account the advice given by the Animals in Science Committee on Strengthening Leading Practice, and this part will now exist as a standalone resource.
And the real point I want to make, my Lords, is that the benefit of this is that it can be updated more quickly than if it remains part of the mandatory code of practice, and should help more effectively to embed emerging improvements and practices across the sector. And on this basis, my Lords, I hope this statutory. Will commend itself to the Committee.
Now, I doubt there's any member of the committee here today who wants to see animal testing and research, if it can be avoided, and the government are rightly committed to ending it. But for the time being, animal research remains an essential component of scientific and biomedical research, and it helps ensure that potential new drugs, vaccines and medicines are safe and effective. As I understand it, for example, certain anaesthetics have only been made possible by research on animals and who among us here today has not benefited at one time or another from an anaesthetic?And the research that's done is fundamental to advancing our understanding of complex biological systems and disease mechanisms.
And it plays an important role in safeguarding human, animal and environmental health. It's also critical to responding to health emergencies, including any future pandemic, which none of us wants to see, but which remains one of the most significant threats to our national security and indeed, our very existence. And scientific advances continue to be made by the life sciences community. Indeed, members may have heard the news a week ago from Cambridge that a research group there have developed a vaccine that might be applicable to a whole category of viruses, with the use for the first time of artificial intelligence.
And this could be a real breakthrough. And like all new technologies, it can be used for good and sometimes not. But at the same time, we must recognise that alternatives to animal testing are not yet mature enough in complexity and application to replace whole animal models. So we must continue to support a balanced research ecosystem that enables both high quality animal studies and the responsible development of animal methods. Now, when this sea was laid, when I saw it, I contacted the Royal Society of Biology for their advice, and I should declare an interest here because I work for the Royal Society of Biology before I was elected to this House, and the society confirms.
My noble friend has set out that this statutory instrument is essentially a tidying up of the existing standards. It represents a change that will help the sector to propose improvements in practice, and for the regulator to accept them and help embed them as expected standards across the research community. The sea related to minor amendments to the Code of Practice for the care and accommodation of animals bred, supplied or used for scientific purposes, such as mandatory standards of care and housing, etc.. So these amendments themselves largely relate to.
My noble friend has said to removing references to the EU which are no longer valid, as well as a few minor clarifications. And the amendments relate to the first two thirds of the code of practice. The final third of the Code of Practice, which relates to non-mandatory guidance and leading practice, has been removed as the Home Office will be revising this more heavily at a later date. My noble friend may be able to confirm it, and will take into account the advice given by the Animals in Science Committee on Strengthening Leading Practice, and this part will now exist as a standalone resource.
And the real point I want to make, my Lords, is that the benefit of this is that it can be updated more quickly than if it remains part of the mandatory code of practice, and should help more effectively to embed emerging improvements and practices across the sector. And on this basis, my Lords, I hope this statutory. Will commend itself to the Committee.
16:23
Speaker 4
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Speaker 4
I to speak very briefly to the statutory instrument. These draft regulations must ensure that the UK's high standards for the use of animals in scientific research continue to operate clearly and effectively, and that technical amendments relating to the animals in scientific procedures. Therefore, it is only correct to have really strong scrutiny where welfare of animals are concerned. I, for one, would hope that government are fully committed to meet those targets set for 2030. To emphasise the fact that this must and should include progress reporting set with clear timescales of action, leading towards supporting a transition away from animal use in science, and absolutely to maintain our current standard, as well as to be in line with the post EU governments.
But any procedural changes must require primary legislation. Technical changes around transparency and oversight are in line. Maintaining UK standards and benchmarks following the removal of EU references. Assurances are required to. How it will operate, though in practice. Whether the amendments fully preserve existing protections and reporting requirements, and how key provisions will be updated over a period of time. Above all, every effort must be made to prevent the unnecessary suffering of animals and to acknowledge further steps again to reduce the use of animals in research.
And finally, may I ask the noble Lord, the minister, what mechanism will replace EU level comparators and oversight, and whether the provision will translate into improved public accountability and transparency?I look forward to the Minister's response.
But any procedural changes must require primary legislation. Technical changes around transparency and oversight are in line. Maintaining UK standards and benchmarks following the removal of EU references. Assurances are required to. How it will operate, though in practice. Whether the amendments fully preserve existing protections and reporting requirements, and how key provisions will be updated over a period of time. Above all, every effort must be made to prevent the unnecessary suffering of animals and to acknowledge further steps again to reduce the use of animals in research.
And finally, may I ask the noble Lord, the minister, what mechanism will replace EU level comparators and oversight, and whether the provision will translate into improved public accountability and transparency?I look forward to the Minister's response.
16:25
Speaker 5
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Speaker 5
My Lords. The noble Lord and the Department for bringing forward the regulations this afternoon, which I believe do reach the right balance. I think Viscount Stansgate, who is very great, has great expertise in the field of science, I think has set out that there will be certain circumstances in which we have to continue. For a short time, foreseeable future, to continue these scientific regulations. I would just like to ask some questions, if I may. Um, are the regulations going to impose an additional burden on the Home Office?Does the noble Lord, the minister, feel that he and the Department have the resources to deal with that?Um, we're about to, um, receive and consider at some point this parliamentary session, the Brexit reset bill.
I am assuming, perhaps rightly or wrongly, that this, um, these regulations will not have a further review as part of the reset because we've now incorporated them into retained EU law. So it would just be helpful to know because my understanding is that and perhaps this is wrong, but my understanding is that if there were to be any changes to the regulations over and above what we are discussing and adopting today, that it might require primary legislation. So what would be the vehicle for that legislation?Is it the Brexit reset bill or are we assured that there will actually be no further changes?Um, also, there is this sort of link.
And between the Home Office and the Department for science, Innovation and Technology, um is the minister confident that his department can take all the decisions that they need to take?Where are the decision making going to fall?Is it entirely within their department collaborating with Dcit or, um, are they going to um, have to work in collaboration?Who will actually be taking the final decisions?And my final question is just to ask that I understand that the target is that there will be 35% reduction in the use of such experiments in dogs.
And non-human primates by 2030. Is that still the case?And are we on course to achieve that?But I would just like to recall that I think we've reached the right balance here. And that can be perceived to be a very vexatious issue. So I congratulate the Department on the Home Office on bringing these regulations forward.
I am assuming, perhaps rightly or wrongly, that this, um, these regulations will not have a further review as part of the reset because we've now incorporated them into retained EU law. So it would just be helpful to know because my understanding is that and perhaps this is wrong, but my understanding is that if there were to be any changes to the regulations over and above what we are discussing and adopting today, that it might require primary legislation. So what would be the vehicle for that legislation?Is it the Brexit reset bill or are we assured that there will actually be no further changes?Um, also, there is this sort of link.
And between the Home Office and the Department for science, Innovation and Technology, um is the minister confident that his department can take all the decisions that they need to take?Where are the decision making going to fall?Is it entirely within their department collaborating with Dcit or, um, are they going to um, have to work in collaboration?Who will actually be taking the final decisions?And my final question is just to ask that I understand that the target is that there will be 35% reduction in the use of such experiments in dogs.
And non-human primates by 2030. Is that still the case?And are we on course to achieve that?But I would just like to recall that I think we've reached the right balance here. And that can be perceived to be a very vexatious issue. So I congratulate the Department on the Home Office on bringing these regulations forward.
16:28
Speaker 6
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Speaker 6
My Lord, I thank the Minister for his clear explanation of this instrument. Um, and other members of this committee for their enlightening speeches. And I welcome the return of the Viscount Stansgate after a limited period away. Um, I think as we consider these regulations, my Lords, it is important that the framework for scientific procedures on animals continues to minimise avoidable suffering and to reflect current best practice. We support the technical purpose of these regulations by consolidating assimilated law into the Animals Scientific Procedures Act 1986.
They provide a clearer domestic legislative framework following our exit from the European Union, and I thank the noble lady McIntosh for making further inquiries on the detail of the reset Bill and the context in which this operates. However, as my colleague Luke Taylor MP noted in the House of Commons, while we support the legal structure, stronger and more explicit action from the government is needed, in our view to improve animal welfare. Within that framework. This instrument maintains the existing safeguards, including the three R's of replacement, reduction and refinement arguments.
Very well made by of replacement by the noble Baroness Redfern. It is essentially a restatement of the status quo as we understand it. We believe the government should be more ambitious. Our long term objective remains the progressive elimination of scientific procedures that cause animals pain, suffering or distress. Where and when viable alternatives exist. I have three questions for the minister. First, on transparency. There have been long standing calls for the repeal or reform of section 24 of the 1986 act to allow greater access to information, subject to appropriate safeguards, and obviously upholding criminal law where it impacts on individuals.
Um, does the Minister agree that moving towards a presumption in favour of openness is important for public confidence and accountability?Secondly, turning to schedule two, a, a, the instrument refers to procedures in the quotes severe category, including those involving significant pain, distress or lethality, such as certain toxicity tests where death is the end point. Recent Home Office statistics show that thousands of such procedures are still being carried out each year. Um, what plans and timelines do the government have to reduce and ultimately phase out these forms of, quote, severe suffering?Thirdly, on Herbie's law and related proposals, we welcome the recent commitments to invest in alternatives to animal use, as referred by the noble Lord, the minister.
However, to deliver real change, there needs to be a clear strategy to support human specific technologies and to embed them across the system, including in regulatory requirements and funding priorities. In conclusion, we recognise that this instrument is a technical update which improves the coherence of the existing regime and of which we support, but this also marks a moment where, if the government wished the United Kingdom to be a genuine leader in this area, further steps will be required, including consideration of a more comprehensive primary legislation on animal health and welfare in science.
They provide a clearer domestic legislative framework following our exit from the European Union, and I thank the noble lady McIntosh for making further inquiries on the detail of the reset Bill and the context in which this operates. However, as my colleague Luke Taylor MP noted in the House of Commons, while we support the legal structure, stronger and more explicit action from the government is needed, in our view to improve animal welfare. Within that framework. This instrument maintains the existing safeguards, including the three R's of replacement, reduction and refinement arguments.
Very well made by of replacement by the noble Baroness Redfern. It is essentially a restatement of the status quo as we understand it. We believe the government should be more ambitious. Our long term objective remains the progressive elimination of scientific procedures that cause animals pain, suffering or distress. Where and when viable alternatives exist. I have three questions for the minister. First, on transparency. There have been long standing calls for the repeal or reform of section 24 of the 1986 act to allow greater access to information, subject to appropriate safeguards, and obviously upholding criminal law where it impacts on individuals.
Um, does the Minister agree that moving towards a presumption in favour of openness is important for public confidence and accountability?Secondly, turning to schedule two, a, a, the instrument refers to procedures in the quotes severe category, including those involving significant pain, distress or lethality, such as certain toxicity tests where death is the end point. Recent Home Office statistics show that thousands of such procedures are still being carried out each year. Um, what plans and timelines do the government have to reduce and ultimately phase out these forms of, quote, severe suffering?Thirdly, on Herbie's law and related proposals, we welcome the recent commitments to invest in alternatives to animal use, as referred by the noble Lord, the minister.
However, to deliver real change, there needs to be a clear strategy to support human specific technologies and to embed them across the system, including in regulatory requirements and funding priorities. In conclusion, we recognise that this instrument is a technical update which improves the coherence of the existing regime and of which we support, but this also marks a moment where, if the government wished the United Kingdom to be a genuine leader in this area, further steps will be required, including consideration of a more comprehensive primary legislation on animal health and welfare in science.
16:32
Speaker 7
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Speaker 7
My Lords, I am grateful to the Minister for introducing these regulations, and I'm pleased to say that at the outset, from the outset, that these benches are broadly supportive of what the government is seeking to achieve, and I'm grateful to all noble Lords that have contributed the. Animal Scientific Procedures Act, 1986, is rightly regarded as a cornerstone of the UK's world leading regulatory framework for the use of animals in science. Lords. It embodies the principles of replacement, reduction and refinement. The three R's and has for 40 years provided a rigorous harm benefit uh, framework that commands respect both domestically and internationally.
And these regulations do nothing to diminish that framework. What this instrument does, in essence, is tidy the house. It restates, revokes, and replaces assimilated law. The legacy EU provisions that were absorbed into our statute book following Brexit and consolidates them properly and coherently into the Animal Scientific Procedures Act 1986 itself. The explanatory memorandum is candid about this being a technical continuity measure. No new burdens are placed on licence holders, no new regulatory requirements are introduced. I think that is the right approach, and I commend the Home Office for bringing it forward.
I also note that the that Northern Ireland has been properly engaged, that consent was obtained and that no objections were raised. That matters, given the regulation of animals used in science is devolved matter, and I'm glad the government has handled it appropriately. There is, however, one question I must put to the minister because it goes to the very foundation of the legal authority underpinning this instrument, and it's a matter that has already been alluded to by my noble friend, lady McIntosh, of Pickering, and that is that the regulations are made under section 12 and 14 of the retained EU law, Revocation and Reform Act 2023.
The explanatory memorandum itself acknowledges that paragraph 6.8, that any regulation made under those powers must be made by no later than the 23rd of June 2026, and that deadline is now a matter of days away. So can the minister therefore confirm what happens after the 23rd of June 2026?Should further technical consolidation of assimilated law in this area be required, whether by way of correction, clarification or updating the powers in sections 12 and 14 will no longer be available. The only route would then be primary legislation, which, as the memorandum itself observes, a considerably more burdensome vehicle for what may in some cases be very minor adjustments.
So will the government set out how it intends to address that gap going forward?And are there further instruments in this area still in preparation that need to be made before the deadline falls?So I am satisfied that this instrument is legally sound and practically sensible. We support it, but I look forward to the Minister's reassurance or the question of what comes next.
And these regulations do nothing to diminish that framework. What this instrument does, in essence, is tidy the house. It restates, revokes, and replaces assimilated law. The legacy EU provisions that were absorbed into our statute book following Brexit and consolidates them properly and coherently into the Animal Scientific Procedures Act 1986 itself. The explanatory memorandum is candid about this being a technical continuity measure. No new burdens are placed on licence holders, no new regulatory requirements are introduced. I think that is the right approach, and I commend the Home Office for bringing it forward.
I also note that the that Northern Ireland has been properly engaged, that consent was obtained and that no objections were raised. That matters, given the regulation of animals used in science is devolved matter, and I'm glad the government has handled it appropriately. There is, however, one question I must put to the minister because it goes to the very foundation of the legal authority underpinning this instrument, and it's a matter that has already been alluded to by my noble friend, lady McIntosh, of Pickering, and that is that the regulations are made under section 12 and 14 of the retained EU law, Revocation and Reform Act 2023.
The explanatory memorandum itself acknowledges that paragraph 6.8, that any regulation made under those powers must be made by no later than the 23rd of June 2026, and that deadline is now a matter of days away. So can the minister therefore confirm what happens after the 23rd of June 2026?Should further technical consolidation of assimilated law in this area be required, whether by way of correction, clarification or updating the powers in sections 12 and 14 will no longer be available. The only route would then be primary legislation, which, as the memorandum itself observes, a considerably more burdensome vehicle for what may in some cases be very minor adjustments.
So will the government set out how it intends to address that gap going forward?And are there further instruments in this area still in preparation that need to be made before the deadline falls?So I am satisfied that this instrument is legally sound and practically sensible. We support it, but I look forward to the Minister's reassurance or the question of what comes next.
16:35
16:36
Speaker 1
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Speaker 1
I'm grateful for the detailed questions and for the contributions that have been made. And can I begin by welcoming back my noble friend Viscount Stansgate?Following following his short interregnum in parliamentary life, having been subject myself at one point to a short interregnum, slightly longer, slightly longer than his. I know that, uh, it's always a gap that, uh, is certainly felt personally, but I'm pleased to see him back in his place today. Um, let me just start, if I may, by welcoming the support in broad terms from the noble Lord Davies of Gower.
And let me go to the central point that has been raised, which I hope reassures the noble Baroness Redfern and the noble Baroness McIntosh, as well. Um which is that these regulations do not weaken safeguards for use of animals in science. Uh, the Scientific Procedures Act of 1986 is the cornerstone of the UK system. These regulations are making simple technical arrangements, uh, amendments. Sorry for restating, revoking and replacing the retained EU provisions so that the legislation continues to operate effectively in domestic law.
And I want to reassure noble Lords that the measures do not reduce welfare standards, create new permissions for animal use, remove existing safeguards and animal use, may still be only authorised where there is no viable alternative and only following rigorous scrutiny independently. Now again, I put that at the beginning of my comments because, uh, and this again goes to the point that the noble Baroness Redfern and indeed noble Baroness Grender have made, which is the future direction of travel. We have said very clearly in the document, which has been produced in conjunction with de the noble Lord Vallance and Defra, the noble Baroness Hayman and myself, to set out as a manifesto commitment, the direction of travel and a roadmap to reduce the use of animals in science, and ultimately to set out further downstream how we can end that altogether if possible, which again, is a very big challenge.
And there are still some areas where, as my noble friend Viscount Stansgate said, that is a valuable contribution to medical research. The 35% reduction target, the noble Baroness McIntosh mentioned is one that we intend to attempt to meet and um, that is a joint effort between Defra. We've put £75 million in with ourselves and the Home Office has the oversight of that regulation. Now, there have been a number of points made around the Brexit reset bill. Um, I can't comment in detail, I'm afraid, today on the content of the Brexit reset bill, but we're trying to do is to give statutory footing to the existing procedures to date.
I will look at the points that the noble Lord Davis has made with regard to the um. 23rd of June. But my understanding is that we brought all the changes forward to ensure that this is now in UK domestic legislation without ties to the EU, and this instrument covers all the necessary requirements, but I will just check because it's important we do that. But that is my understanding of the situation to date. Uh, the noble Viscount Stansgate also mentioned a number of points.
And if I may say in response that section three of the code will be republished and we will seek to update the section that the noble Viscount has mentioned. I've commissioned, uh, the A S to look into how we deliver best practice for animals in science. And again, that goes to the heart of the points that the noble Baroness Grender made from the front. Um, regulatory oversight remains the responsibility of the animals in Science Regulation Unit, which operates under regulatory principles that include proportionality, transparency and accountability.
If there are addresses, uh, sorry, instances of non-compliance, the regulator again going to the points made in the debate retains a wide range of enforcement powers, going from advice to licensed variation through to suspension revocation and in the most serious cases, referral for prosecution and nothing in this order changes that enforcement decisions are evidence based and risk informed. And the aim of this order and the aim of the work that we're doing, is to secure the best outcomes for animal welfare and ensure the regulatory framework operates in a proportionate and effective way.
And while also, may I say, driving continuous improvement, um, the noble Baroness Grender also mentioned Herbie's law, and I understand the interest and the concern around developing a proposed framework for replacing animals in medical research by 2035. Um, we've tried not to in our document to set arbitrary deadlines. Uh, they may prove undeliverable. Instead, what we have set out is a science based approach that provides clear timelines for specific deliverable actions as evidence and capability is developed. And I hope I can reassure the noble Baroness that the government's new strategy sets out that long term vision for a world where animals in science use is eliminated, except in exceptional circumstances, and even those exceptional circumstances might as um, medicine and science develops, be further areas that we can push forward.
It's not yet possible to replace all animal use, given the complexity of whole biological systems, but the government is very clear, and I hope again, this reassures her and those supporters of Herbie's law, that progress must be led by science. Progress must be made, but it must be made in a way that doesn't lose the benefits that the noble Viscount, my noble friend has mentioned to date. Because all of us are living healthier lives today because of research, investment and outcomes. From that research, however difficult and challenging that is at certain points in time.
Um, I hope I've answered all of the points, uh, in front of the committee today. Uh, but the ones that, um, potentially, uh, need further investigation, I will look at and respond in due course. But in the meantime, my Lords, if there's no further comments to make, I will commend this to the committee. But I see the noble Baron and I will give way, of course.
And let me go to the central point that has been raised, which I hope reassures the noble Baroness Redfern and the noble Baroness McIntosh, as well. Um which is that these regulations do not weaken safeguards for use of animals in science. Uh, the Scientific Procedures Act of 1986 is the cornerstone of the UK system. These regulations are making simple technical arrangements, uh, amendments. Sorry for restating, revoking and replacing the retained EU provisions so that the legislation continues to operate effectively in domestic law.
And I want to reassure noble Lords that the measures do not reduce welfare standards, create new permissions for animal use, remove existing safeguards and animal use, may still be only authorised where there is no viable alternative and only following rigorous scrutiny independently. Now again, I put that at the beginning of my comments because, uh, and this again goes to the point that the noble Baroness Redfern and indeed noble Baroness Grender have made, which is the future direction of travel. We have said very clearly in the document, which has been produced in conjunction with de the noble Lord Vallance and Defra, the noble Baroness Hayman and myself, to set out as a manifesto commitment, the direction of travel and a roadmap to reduce the use of animals in science, and ultimately to set out further downstream how we can end that altogether if possible, which again, is a very big challenge.
And there are still some areas where, as my noble friend Viscount Stansgate said, that is a valuable contribution to medical research. The 35% reduction target, the noble Baroness McIntosh mentioned is one that we intend to attempt to meet and um, that is a joint effort between Defra. We've put £75 million in with ourselves and the Home Office has the oversight of that regulation. Now, there have been a number of points made around the Brexit reset bill. Um, I can't comment in detail, I'm afraid, today on the content of the Brexit reset bill, but we're trying to do is to give statutory footing to the existing procedures to date.
I will look at the points that the noble Lord Davis has made with regard to the um. 23rd of June. But my understanding is that we brought all the changes forward to ensure that this is now in UK domestic legislation without ties to the EU, and this instrument covers all the necessary requirements, but I will just check because it's important we do that. But that is my understanding of the situation to date. Uh, the noble Viscount Stansgate also mentioned a number of points.
And if I may say in response that section three of the code will be republished and we will seek to update the section that the noble Viscount has mentioned. I've commissioned, uh, the A S to look into how we deliver best practice for animals in science. And again, that goes to the heart of the points that the noble Baroness Grender made from the front. Um, regulatory oversight remains the responsibility of the animals in Science Regulation Unit, which operates under regulatory principles that include proportionality, transparency and accountability.
If there are addresses, uh, sorry, instances of non-compliance, the regulator again going to the points made in the debate retains a wide range of enforcement powers, going from advice to licensed variation through to suspension revocation and in the most serious cases, referral for prosecution and nothing in this order changes that enforcement decisions are evidence based and risk informed. And the aim of this order and the aim of the work that we're doing, is to secure the best outcomes for animal welfare and ensure the regulatory framework operates in a proportionate and effective way.
And while also, may I say, driving continuous improvement, um, the noble Baroness Grender also mentioned Herbie's law, and I understand the interest and the concern around developing a proposed framework for replacing animals in medical research by 2035. Um, we've tried not to in our document to set arbitrary deadlines. Uh, they may prove undeliverable. Instead, what we have set out is a science based approach that provides clear timelines for specific deliverable actions as evidence and capability is developed. And I hope I can reassure the noble Baroness that the government's new strategy sets out that long term vision for a world where animals in science use is eliminated, except in exceptional circumstances, and even those exceptional circumstances might as um, medicine and science develops, be further areas that we can push forward.
It's not yet possible to replace all animal use, given the complexity of whole biological systems, but the government is very clear, and I hope again, this reassures her and those supporters of Herbie's law, that progress must be led by science. Progress must be made, but it must be made in a way that doesn't lose the benefits that the noble Viscount, my noble friend has mentioned to date. Because all of us are living healthier lives today because of research, investment and outcomes. From that research, however difficult and challenging that is at certain points in time.
Um, I hope I've answered all of the points, uh, in front of the committee today. Uh, but the ones that, um, potentially, uh, need further investigation, I will look at and respond in due course. But in the meantime, my Lords, if there's no further comments to make, I will commend this to the committee. But I see the noble Baron and I will give way, of course.
16:42
16:42
Speaker 1
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Speaker 1
Well, um I certainly. Can um but again, um my understanding is that the instrument before us today covers all necessary requirements, and we brought forward all the changes we need to, to ensure that the UK domestic legislation is correct without ties to the EU law. And the 23rd of June deadline is effectively met by this order. Um I will reflect on that. Um, as I've mentioned before, I can't give details of the Brexit bill because it hasn't been published yet and it's not appropriate to do so, but I'll reflect on what he said and if there's any further information to add, I will of course, write to him.
And if any noble Lord or lady wishes to have that correspondence, please contact my office.
And if any noble Lord or lady wishes to have that correspondence, please contact my office.
16:43
16:44
16:44
16:44
Speaker 3
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Speaker 3
Will indulge me to ask a further question on this point. After the 23rd of June, it will not be possible for the Department, for the Home Office or whichever other department. This rise will arise again in the next debate to bring forward measures using statutory instruments so as to adjust these regulations. Now it will either have to be done by primary legislation, or they will have to be a framework put in place by an Act of Parliament that allows those um, those changes to be made by s I.
Now, it seems to be the case, the tenor of the questions that have been asked of the noble Lord, that his answer is that that framework is going to be put in place by the Brexit Reset Bill. That has not been said before, as far as I'm aware. So is it the is it the government's position that this issue, the so-called powers gap, is going to be addressed, as the noble Lord implies by the Brexit Reset Bill or by some other act of Parliament of which we have no knowledge yet.
Now, it seems to be the case, the tenor of the questions that have been asked of the noble Lord, that his answer is that that framework is going to be put in place by the Brexit Reset Bill. That has not been said before, as far as I'm aware. So is it the is it the government's position that this issue, the so-called powers gap, is going to be addressed, as the noble Lord implies by the Brexit Reset Bill or by some other act of Parliament of which we have no knowledge yet.
16:45
Speaker 1
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Speaker 1
Apologies to the Committee if I haven't made myself clear, I thought I had made myself clear. Um, I was asked a question about the Brexit reset bill and whether any further information was required in that bill to deal with this issue. I have said that I can't comment on the Brexit reset bill, but I have also said, in response to the question about the 23rd of June, that our assessment is that this s I puts us into a position of where we are in relation to all assimilation required.
I have also said, as a third point, that just to make sure that that is the case, having had it raised today, I want to just test again with officials outside of this committee that that is the case. That is my understanding. And therefore, um, essentially the Brexit reset Bill is a matter for future discussion with primary legislation on a number of issues relating to Brexit. Reset the SSI puts in place what we've already got in the same mechanism has already got it. But if there are issues around the 23rd of June, I will examine those with officials and write to the noble Lord.
And with that I would commend the s I to the Grand Committee.
I have also said, as a third point, that just to make sure that that is the case, having had it raised today, I want to just test again with officials outside of this committee that that is the case. That is my understanding. And therefore, um, essentially the Brexit reset Bill is a matter for future discussion with primary legislation on a number of issues relating to Brexit. Reset the SSI puts in place what we've already got in the same mechanism has already got it. But if there are issues around the 23rd of June, I will examine those with officials and write to the noble Lord.
And with that I would commend the s I to the Grand Committee.
16:46
Speaker 2
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Speaker 2
Questions that the Grand Committee has considered. This instrument is meant to. That opinion will say content, not content. The content have it. Shall we take a moment to shuffle the ministers?Uh, the. Mr.. Is happy to to fly solo on this one. So let us begin airport slot allocation, Alleviation of Usage Requirements Regulations 2026. Lord Hendy of Richmond Hill.
16:47
Speaker 8
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Speaker 8
My Lords, I beg to move that the draft airport slot allocation, alleviation of Usage Requirements Regulations 2026 be considered. Airport slots are permissions that allow airlines to take off and land at specific dates and times. They are a valuable resource at capacity constrained airports. The UK currently has nine such airports, including the main five London airports Gatwick, Heathrow, London City, Luton and Stansted, as well as Birmingham, Bristol, Leeds, Bradford and Manchester. These regulations are necessary in the context of the continuing conflict in the Middle East, which is creating disruption and uncertainty for the aviation sector and therefore for airline passengers.
The government has therefore designed a hand back measure for slots for the summer 2026 and winter 2026 seasons that allow airlines to return up to 10% of their slots if necessary, without losing the right to those same slots the following year. The use of this hand back does not need to link to fuel shortage, because there is no fuel shortage at present. As UK airlines have stated. However, the impact of the continuing conflict in the Middle East is more nuanced and wide ranging. Airlines are facing longer flight paths, increased fuel costs and in some cases, shifting passenger demand, particularly on routes affected by regional instability.
These regulations provide flexibility to manage genuine operational challenges and reduce the risk of last minute cancellations. Sorry. There is therefore a need for intervention as the developments in the Middle East remain unpredictable and continue to put undue pressure on the aviation sector, these pressures are completely outside the control of airlines but are nevertheless having an impact on their ability to operate as planned. Without intervention, airlines would not be able to respond to known risks to their operations, and passengers would be exposed to last minute cancellations and disruption at the departure gates.
These regulations respond and continue to put undue pressure on the aviation sector. These pressures are completely outside the control of airlines, but are nevertheless having an impact on their ability to operate as planned. Without intervention, airlines would not be able to respond to known risks to their operations, and passengers would be exposed to last minute cancellations and disruption at the departure gates. These regulations respond directly to the uncertainty and operational impact of the Middle East conflict by providing limited, targeted flexibility whilst maintaining the overall integrity of the slot allocation system.
The content of the statutory instrument allows airlines to hand back over up to 10% of their allocated slots at slot coordinated airports across the UK. These are the UK's busiest and most capacity constrained airports, where demand for takeoff and landing times is greater than the available capacity. As I've said, the regulations apply for the summer and winter 2026. Scheduling seasons. Airlines will be able to hand back up to 10% of their slots without losing their historic entitlement to these slots. In the following equivalent season.
This 10% flexibility is split into two stages. Airlines may return up to 5% of their slots by a specified date in each season, and a further 5% through the throughout the remainder of the season to return slots. Under these regulations, airlines must give passengers at least 14 days notice if a flight is cancelled. This approach strikes a careful balance. It provides airlines with some flexibility to adjust their schedules to mitigate impacts of the conflict in the Middle East, whilst keeping passenger protections at the forefront.
Importantly, the measure is time limited because it applies only to the summer and winter 2026 seasons, ensuring ensuring a proportionate response to current circumstances. The regulations also allow return slots to be reallocated where possible. This helps ensure that valuable airport capacity is not left unused. If the situation in the Middle East was to take a definitive, positive turn, it also enables airlines that are less exposed to wider impacts of the conflict in the Middle East to step in and make use of return slots to meet passenger demand.
The draft instrument being considered today applies to England, Scotland and Wales. Airports are a devolved matter in relation to Northern Ireland, but there are currently no stock coordinated airports in Scotland, Wales and Northern Ireland. The government undertook a targeted consultation with airlines, airports and other sector stakeholders on our proposal for alleviation for summer in 2016 and winter 26 season. The consultation received a total of 59 responses. There was strong support amongst airlines for the proposed slots hand back provision, albeit most wanted to hand back threshold to be 20%.
Airports were generally opposed to alleviation being granted and wanted a lower threshold for hand back. The government has therefore adopted a balanced position, providing a 10% hand back for summer and winter 2026. It gives airlines enough room to manage a genuine operational challenge if it arises, whilst making sure they can't use it on cancellations that go well beyond what the situation requires. Furthermore, in the light of consultation, airport responses in particular, we have ensured that slots are handed that that are handed back can be reallocated.
This ensures that where airlines are able to make use of these slots, they can be picked up so that valuable airport capacity is not wasted, striking an appropriate balance between flexibility for airlines and efficient use of airport infrastructure during times of crisis or widespread disruption. For example, during Covid 19, government stepped in to provide alleviation from slot usage requirements over and above the existing justified non-utilization of slots. Provisions set out in the slots regulation. Most recently in summer 2022, the government implemented a 30% hand back to stabilise airport operations and reduce disruption to passengers.
The government is grateful to the Secondary Legislation Scrutiny Committee for its careful consideration of this instrument. I will now address the comments. They raised. The 10% hand back provision was consulted on on a range of views were received. Whilst many airlines argued for a higher threshold, no substantive evidence was provided. Ministers concluded that 10% represents an appropriate and proportionate balance supported by the available evidence on passenger impact. The 14 day notice period aligns with the previous slot alleviation measures and where airlines return slots passengers are protected under UK law and are entitled to a refund or rerouting wider rights, including compensation in some cases are set out in aviation consumer protection rules.
The existing justified non-utilization of slots regime. Join US is reactive and does not support forward planning, increasing the risk of late cancellations. This measure addresses this gap on the final points raised, the government continues to monitor fuel supply closely and engage with industry, with UK airlines reporting no current shortages. Finally, the powers underpinning this instrument expire on the 23rd of June 2026. Under the retained EU Law Act, replacement powers are being sought through Civil Aviation Bill, and any future use will depend on the prevailing circumstances.
My Lords, the policy intent behind these measures is clear to support a resilient aviation sector whilst protecting passengers in the environment. First and foremost, they support better planning for passengers by enabling airlines to adjust schedules in advance. Passengers are more likely to receive early notice of cancellation rather than facing last minute disruption at the airport. Noble Lords may be considering why the government is acting now before any acute or system wide shortage of fuel has or will materialise. The answer is that this is a preventative and forward looking measure.
The disruption caused by the conflict in the Middle East is already affecting airline operations, costs and demand patterns. Waiting until those pressures result in widespread cancellations or operational instability would risk greater disruption to passengers than the sector. By acting now, the government is enabling airlines to plan ahead, adjust schedules in an orderly way and provide passengers with meaningful notice of changes, rather than reacting at the last minute. Secondly, these regulations reduce the risk of unnecessary flights by removing the pressure to operate flights purely to retain slots, we expect fewer near empty aircraft in the skies.
This enables more efficient, efficient use of jet fuel stocks and aviation network capacity. Thirdly, they help to provide to protect connectivity. Airport slots underpin route networks that have been built up over many years, allowing airlines to retain their historic rights despite temporary disruption helps ensure that those connections can be restored once conditions stabilise. Finally, these measures support the financial stability of airlines without them, if an airline is aware of issues that would make it difficult to operate a flight, it would face a choice between continuing with plans to run it anyway or cancelling it at the last minute and potentially losing that slot at the airport permanently.
My Lords, to close these regulations represent a practical and proportionate response to a specific and challenging set of circumstances. They maintain the integrity of the slot allocation system while introducing temporary flexibility to reflect real world pressures. They support airlines, benefit passengers and help to avoid unnecessary environmental harm. Above all, there are measured intervention time limited, targeted and grounded in the realities facing the aviation sector today. I hope that noble Lords will recognise the balance that's been struck and will join me in supporting these measures.
I beg to move.
The government has therefore designed a hand back measure for slots for the summer 2026 and winter 2026 seasons that allow airlines to return up to 10% of their slots if necessary, without losing the right to those same slots the following year. The use of this hand back does not need to link to fuel shortage, because there is no fuel shortage at present. As UK airlines have stated. However, the impact of the continuing conflict in the Middle East is more nuanced and wide ranging. Airlines are facing longer flight paths, increased fuel costs and in some cases, shifting passenger demand, particularly on routes affected by regional instability.
These regulations provide flexibility to manage genuine operational challenges and reduce the risk of last minute cancellations. Sorry. There is therefore a need for intervention as the developments in the Middle East remain unpredictable and continue to put undue pressure on the aviation sector, these pressures are completely outside the control of airlines but are nevertheless having an impact on their ability to operate as planned. Without intervention, airlines would not be able to respond to known risks to their operations, and passengers would be exposed to last minute cancellations and disruption at the departure gates.
These regulations respond and continue to put undue pressure on the aviation sector. These pressures are completely outside the control of airlines, but are nevertheless having an impact on their ability to operate as planned. Without intervention, airlines would not be able to respond to known risks to their operations, and passengers would be exposed to last minute cancellations and disruption at the departure gates. These regulations respond directly to the uncertainty and operational impact of the Middle East conflict by providing limited, targeted flexibility whilst maintaining the overall integrity of the slot allocation system.
The content of the statutory instrument allows airlines to hand back over up to 10% of their allocated slots at slot coordinated airports across the UK. These are the UK's busiest and most capacity constrained airports, where demand for takeoff and landing times is greater than the available capacity. As I've said, the regulations apply for the summer and winter 2026. Scheduling seasons. Airlines will be able to hand back up to 10% of their slots without losing their historic entitlement to these slots. In the following equivalent season.
This 10% flexibility is split into two stages. Airlines may return up to 5% of their slots by a specified date in each season, and a further 5% through the throughout the remainder of the season to return slots. Under these regulations, airlines must give passengers at least 14 days notice if a flight is cancelled. This approach strikes a careful balance. It provides airlines with some flexibility to adjust their schedules to mitigate impacts of the conflict in the Middle East, whilst keeping passenger protections at the forefront.
Importantly, the measure is time limited because it applies only to the summer and winter 2026 seasons, ensuring ensuring a proportionate response to current circumstances. The regulations also allow return slots to be reallocated where possible. This helps ensure that valuable airport capacity is not left unused. If the situation in the Middle East was to take a definitive, positive turn, it also enables airlines that are less exposed to wider impacts of the conflict in the Middle East to step in and make use of return slots to meet passenger demand.
The draft instrument being considered today applies to England, Scotland and Wales. Airports are a devolved matter in relation to Northern Ireland, but there are currently no stock coordinated airports in Scotland, Wales and Northern Ireland. The government undertook a targeted consultation with airlines, airports and other sector stakeholders on our proposal for alleviation for summer in 2016 and winter 26 season. The consultation received a total of 59 responses. There was strong support amongst airlines for the proposed slots hand back provision, albeit most wanted to hand back threshold to be 20%.
Airports were generally opposed to alleviation being granted and wanted a lower threshold for hand back. The government has therefore adopted a balanced position, providing a 10% hand back for summer and winter 2026. It gives airlines enough room to manage a genuine operational challenge if it arises, whilst making sure they can't use it on cancellations that go well beyond what the situation requires. Furthermore, in the light of consultation, airport responses in particular, we have ensured that slots are handed that that are handed back can be reallocated.
This ensures that where airlines are able to make use of these slots, they can be picked up so that valuable airport capacity is not wasted, striking an appropriate balance between flexibility for airlines and efficient use of airport infrastructure during times of crisis or widespread disruption. For example, during Covid 19, government stepped in to provide alleviation from slot usage requirements over and above the existing justified non-utilization of slots. Provisions set out in the slots regulation. Most recently in summer 2022, the government implemented a 30% hand back to stabilise airport operations and reduce disruption to passengers.
The government is grateful to the Secondary Legislation Scrutiny Committee for its careful consideration of this instrument. I will now address the comments. They raised. The 10% hand back provision was consulted on on a range of views were received. Whilst many airlines argued for a higher threshold, no substantive evidence was provided. Ministers concluded that 10% represents an appropriate and proportionate balance supported by the available evidence on passenger impact. The 14 day notice period aligns with the previous slot alleviation measures and where airlines return slots passengers are protected under UK law and are entitled to a refund or rerouting wider rights, including compensation in some cases are set out in aviation consumer protection rules.
The existing justified non-utilization of slots regime. Join US is reactive and does not support forward planning, increasing the risk of late cancellations. This measure addresses this gap on the final points raised, the government continues to monitor fuel supply closely and engage with industry, with UK airlines reporting no current shortages. Finally, the powers underpinning this instrument expire on the 23rd of June 2026. Under the retained EU Law Act, replacement powers are being sought through Civil Aviation Bill, and any future use will depend on the prevailing circumstances.
My Lords, the policy intent behind these measures is clear to support a resilient aviation sector whilst protecting passengers in the environment. First and foremost, they support better planning for passengers by enabling airlines to adjust schedules in advance. Passengers are more likely to receive early notice of cancellation rather than facing last minute disruption at the airport. Noble Lords may be considering why the government is acting now before any acute or system wide shortage of fuel has or will materialise. The answer is that this is a preventative and forward looking measure.
The disruption caused by the conflict in the Middle East is already affecting airline operations, costs and demand patterns. Waiting until those pressures result in widespread cancellations or operational instability would risk greater disruption to passengers than the sector. By acting now, the government is enabling airlines to plan ahead, adjust schedules in an orderly way and provide passengers with meaningful notice of changes, rather than reacting at the last minute. Secondly, these regulations reduce the risk of unnecessary flights by removing the pressure to operate flights purely to retain slots, we expect fewer near empty aircraft in the skies.
This enables more efficient, efficient use of jet fuel stocks and aviation network capacity. Thirdly, they help to provide to protect connectivity. Airport slots underpin route networks that have been built up over many years, allowing airlines to retain their historic rights despite temporary disruption helps ensure that those connections can be restored once conditions stabilise. Finally, these measures support the financial stability of airlines without them, if an airline is aware of issues that would make it difficult to operate a flight, it would face a choice between continuing with plans to run it anyway or cancelling it at the last minute and potentially losing that slot at the airport permanently.
My Lords, to close these regulations represent a practical and proportionate response to a specific and challenging set of circumstances. They maintain the integrity of the slot allocation system while introducing temporary flexibility to reflect real world pressures. They support airlines, benefit passengers and help to avoid unnecessary environmental harm. Above all, there are measured intervention time limited, targeted and grounded in the realities facing the aviation sector today. I hope that noble Lords will recognise the balance that's been struck and will join me in supporting these measures.
I beg to move.
16:57
16:57
16:57
Speaker 3
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Speaker 3
Interest as a pilot and honorary vice president of Balpa, the pilots union and a former director of an airport. Um. Having said that, I generally welcome these provisions. But of course, they are part of the assimilated law of the EU, in fact, quite conveniently, so that we can make alterations of this kind to the slot system. But I do want to question the minister a little bit about 1 or 2 aspects of this. The slots, as we know, and it's referred to, I think, in in some of the explanatory memoranda, slots themselves are a major asset of airlines in particular, sometimes they're actually worth more than the whole of the rest of the airline put together, including all its all its aircraft and the rest.
Um, so they are enormously valuable. And therefore the allocation of slots is a critical matter. Um and that of course includes also any slots that become available for reallocation. Um the minister has referred to this being a temporary measure. I would like to get confirmation from him. Um he says it's relation to the Middle East conflict, but then he spoke later about the jet fuel situation and so on, which clearly is a looming threat, I suppose, but is not the main argument here.
The main argument he is deploying is that the Middle East conflict means that a lot of airlines are no longer able to carry out their normal routes, which they would like to, and consequently to avoid the nonsense of having aircraft running, as it were, without passengers, which of course, I think has been the case in a number of instances. Um, this switching of the or allowing them to have their slots put back and then then used at a later date or used later does seem to make sense, except that so far as I could read the measure, it talks about ultimately a five year term, um, with a.
Review. When he said it's only short term for 2026, perhaps he could just confirm to me that that is the case and that this other element in which there is written in somewhere here, a five year term or a review that is not relevant to this point. So I'd be very grateful for some confirmation on that.
Um, so they are enormously valuable. And therefore the allocation of slots is a critical matter. Um and that of course includes also any slots that become available for reallocation. Um the minister has referred to this being a temporary measure. I would like to get confirmation from him. Um he says it's relation to the Middle East conflict, but then he spoke later about the jet fuel situation and so on, which clearly is a looming threat, I suppose, but is not the main argument here.
The main argument he is deploying is that the Middle East conflict means that a lot of airlines are no longer able to carry out their normal routes, which they would like to, and consequently to avoid the nonsense of having aircraft running, as it were, without passengers, which of course, I think has been the case in a number of instances. Um, this switching of the or allowing them to have their slots put back and then then used at a later date or used later does seem to make sense, except that so far as I could read the measure, it talks about ultimately a five year term, um, with a.
Review. When he said it's only short term for 2026, perhaps he could just confirm to me that that is the case and that this other element in which there is written in somewhere here, a five year term or a review that is not relevant to this point. So I'd be very grateful for some confirmation on that.
16:59
Speaker 9
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Speaker 9
Be grateful for some confirmation on that. I would also like just to get his comments. Um, on the question of airport designations, because as we know, we're talking here and it's referred to as the three levels of designation of airports. The categories of non coordinated, the schedules facilitated and also the coordinated airports, which are the ones we're talking about that have slots attached to them. Can he just confirm. I see in the case of Leeds Bradford one of my local airports, um that these provisions will only apply to the summer season.
I believe that's the case or slots only apply to summer season with Leeds Bradford. But could he just confirm to me at what point the designations are reviewed or take place. Because we do seem to be interminably. I've been on statutory instruments with the minister before, and we seem to always have the same airports. And development of airports is a very moving thing. And I just wonder where it is that an airport becomes coordinated and eligible to deal with slots, or to have slots applicable to it.
Um, the other point is allocation or re-allocation of slots. As I said before, is a very valuable thing. Um, new entrants, we're losing a few airlines at the moment and most of them seem to be in the freighting business, but um, we're losing some because of the pressures financially. And as I said before, the slots really matter here. What is the basis upon which re allocation of slots can go to new entrants. Um there are people hanging on here desperate to get slots into some of our coordinated airports.
I wonder just what is the level at which, um, this plan that we have now moves to one where these slots are available for reallocation. And finally, the coordinator organisation, I read here that, uh, they only have 40 staff. It is an amazing situation. Can the minister confirm to me, please, the status of the coordination organisation, which actually makes the decision here?Um about the slots and about reallocation and so on. It does seem to me to be an organisation which is almost out of the normal structures that we're dealing with in considering these matters.
Um, I think finally, I just want to say that I think we do have to be very careful when we're dealing with this subject, because although I understand and I sympathise with what the minister is suggesting, and it certainly will be helpful in terms of organisation of routes and also the financial position currently of the airlines that benefit from this. I would not like to see this being a deterrence to an extension of of the business of airlines, because I do think that's one of the greatest things this country has, is the nature and status of those that provide air services.
I believe that's the case or slots only apply to summer season with Leeds Bradford. But could he just confirm to me at what point the designations are reviewed or take place. Because we do seem to be interminably. I've been on statutory instruments with the minister before, and we seem to always have the same airports. And development of airports is a very moving thing. And I just wonder where it is that an airport becomes coordinated and eligible to deal with slots, or to have slots applicable to it.
Um, the other point is allocation or re-allocation of slots. As I said before, is a very valuable thing. Um, new entrants, we're losing a few airlines at the moment and most of them seem to be in the freighting business, but um, we're losing some because of the pressures financially. And as I said before, the slots really matter here. What is the basis upon which re allocation of slots can go to new entrants. Um there are people hanging on here desperate to get slots into some of our coordinated airports.
I wonder just what is the level at which, um, this plan that we have now moves to one where these slots are available for reallocation. And finally, the coordinator organisation, I read here that, uh, they only have 40 staff. It is an amazing situation. Can the minister confirm to me, please, the status of the coordination organisation, which actually makes the decision here?Um about the slots and about reallocation and so on. It does seem to me to be an organisation which is almost out of the normal structures that we're dealing with in considering these matters.
Um, I think finally, I just want to say that I think we do have to be very careful when we're dealing with this subject, because although I understand and I sympathise with what the minister is suggesting, and it certainly will be helpful in terms of organisation of routes and also the financial position currently of the airlines that benefit from this. I would not like to see this being a deterrence to an extension of of the business of airlines, because I do think that's one of the greatest things this country has, is the nature and status of those that provide air services.
17:02
Speaker 10
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Speaker 10
My Lords, um, can I first say that I welcome these regulations?This is a. Core part of the current responsibility of the Department in difficult times internationally. Um, it is absolutely the right thing to do to try and ease pressures on airlines in an environment where the current geopolitical situation has made many routes much less viable than they were, and has led to cutbacks around the world in the number of planes flying for the time being. Um, however, I would say also, and I think we'll come back to this at greater length in the debates in the forthcoming aviation bill.
But it is also the fact we're having this debate today is an indication that this is a heavily regulated area. We inherited a lot of that regulation from the European Union. And I have to say, I had hoped in one of my views remains that this should be a less regulated sector than it is, and probably it shouldn't really need a debate in Parliament to enable an airline to take a decision to scale back temporarily in an international crisis. Some of its activities, without a risk of long term damage to its business.
So this is a debate that probably, in my view, shouldn't need to happen. But in the context of the current laws, is absolutely essential. I do, though, have one particular concern that I want to raise with the minister, and that is about the impact on some individual airlines. The choice of the 5% and 10% figures, um, to me, don't make complete sense. Um, in the context of an environment where the routes most substantially affected the routes through the Middle East. So taking a practical example, if an airline like Emirates, um, has two flights a day to a UK airport, and that is not currently viable because of the geopolitical situation, the reality is tourist numbers in particular have dropped very sharply through them.
At least. I had an email today from a hotel in Amman. I stayed in some while back begging me to come back and offering me a good deal to do so. So there is no doubt that numbers have fallen sharply. It is therefore very probable that running two planes a day is not viable for the time being, and you can only afford, in practical business terms, to run one plane a day. That's a 50% drop. But if you can only cut 5% or 10%, then that doesn't quite work arithmetically.
So I'm slightly concerned that the inflexibility of the numbers in this regulation will not fit with the practical reality facing a number of airlines, and I'd be grateful for the minister's comments about that. And one final point. Also, there were a couple of airlines that didn't want this to happen. I'd be interested to hear from the minister why that was, because there may be. Practical reasons, or this may be simply anti-competitive pressures. And we can imagine 1 or 2 airlines who might want to get in the way of sensible changes to ease pressures on their competitors.
Um, but I think in particular, I want to press the minister on that issue of the 5 or 10% figures, because it seems to me for some airlines, if you have very large numbers of slots at Heathrow or Gatwick, fine. It makes perfect sense. But if you have a relatively small number of slots and you are worse affected than other airlines because of the geopolitical situation, it may well not work at all. So I'd be interested in the minister's comments on that.
But it is also the fact we're having this debate today is an indication that this is a heavily regulated area. We inherited a lot of that regulation from the European Union. And I have to say, I had hoped in one of my views remains that this should be a less regulated sector than it is, and probably it shouldn't really need a debate in Parliament to enable an airline to take a decision to scale back temporarily in an international crisis. Some of its activities, without a risk of long term damage to its business.
So this is a debate that probably, in my view, shouldn't need to happen. But in the context of the current laws, is absolutely essential. I do, though, have one particular concern that I want to raise with the minister, and that is about the impact on some individual airlines. The choice of the 5% and 10% figures, um, to me, don't make complete sense. Um, in the context of an environment where the routes most substantially affected the routes through the Middle East. So taking a practical example, if an airline like Emirates, um, has two flights a day to a UK airport, and that is not currently viable because of the geopolitical situation, the reality is tourist numbers in particular have dropped very sharply through them.
At least. I had an email today from a hotel in Amman. I stayed in some while back begging me to come back and offering me a good deal to do so. So there is no doubt that numbers have fallen sharply. It is therefore very probable that running two planes a day is not viable for the time being, and you can only afford, in practical business terms, to run one plane a day. That's a 50% drop. But if you can only cut 5% or 10%, then that doesn't quite work arithmetically.
So I'm slightly concerned that the inflexibility of the numbers in this regulation will not fit with the practical reality facing a number of airlines, and I'd be grateful for the minister's comments about that. And one final point. Also, there were a couple of airlines that didn't want this to happen. I'd be interested to hear from the minister why that was, because there may be. Practical reasons, or this may be simply anti-competitive pressures. And we can imagine 1 or 2 airlines who might want to get in the way of sensible changes to ease pressures on their competitors.
Um, but I think in particular, I want to press the minister on that issue of the 5 or 10% figures, because it seems to me for some airlines, if you have very large numbers of slots at Heathrow or Gatwick, fine. It makes perfect sense. But if you have a relatively small number of slots and you are worse affected than other airlines because of the geopolitical situation, it may well not work at all. So I'd be interested in the minister's comments on that.
17:06
Speaker 11
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Speaker 11
My Lords, I rise briefly to support my noble friend and the statutory instrument that he has moved, and I understand entirely that it is designed to support a resilient aviation sector. And I just want to ask one question. The Secondary Legislation Scrutiny Committee referred as indeed, my noble friend, did to the example of 2022, when, as I understand it, there was a 30% hand-back of slots. And I just wanted to ask if the information is to hand what happened as a result, when the um afterwards, when the temporary provision, uh, ended.
Did the slots go back in precisely the same way to the airlines that had them at the time?And the reason I ask is because I'm curious as to whether or not in the current conditions, a 10%. Hand-back will result eventually in these being handed back to the same airlines. And it may be the case or it may not be the case, but I'd be interested. If the Minister has anything he might be able to add to the discussion in the Committee about this.
Did the slots go back in precisely the same way to the airlines that had them at the time?And the reason I ask is because I'm curious as to whether or not in the current conditions, a 10%. Hand-back will result eventually in these being handed back to the same airlines. And it may be the case or it may not be the case, but I'd be interested. If the Minister has anything he might be able to add to the discussion in the Committee about this.
17:07
Speaker 6
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Speaker 6
Um, I thank the noble Lord, the Minister, for introducing this draft instrument and for explaining its purpose and for the meeting in advance with his officials, um, and the briefing that they sent. As with all such measures, we need to look not only at the administrative detail, but at the practical impact on passengers. Other noble lords have been referring to the impact on the airlines themselves. Um, quite a bit of my comment will be about the passengers. Um and of course, uh, you know, the impact on the wider aviation sector and its own sustainability.
These regulations amend the slot usage rules so that airlines at specified UK airports can return a limited proportion of slots for the summer and winter 26 seasons. We understand the case for the flexibility during a period of considerable uncertainty, including and in particular, the conflict in the Middle East. And we don't want airlines to be incentivised to operate empty or near empty flights simply to preserve the historic slot rights. Described by the noble Lord Kirkhope. That said, flexibility, in our view, mustn't come at the expense of the passengers.
Even where there is some notice. These changes, we fear, can still lead to cancellations with relatively little little warning causing significant disruption to travel plans in a period when household budgets are under pressure and fares remain high. That can mean higher replacement costs for families, as well as losses on hotels, onward travel and other arrangements already paid for. Um, and I noticed that, for instance, train tickets is an example that's laid out in the fifth question of appendix one of the Department of Transport's answers to the Secondary Legislation Scrutiny Committee.
Um, and it's that's a very good example of what I'm talking about here. There is to a broader question of balance. The airline sector is under pressure, and we recognise the need to support its long term sustainability. But we worry that the burden of adjustment should not fall unfairly on passengers, especially leisure travellers who are less able to absorb sudden change. And we feel we need to be careful that a measure intended to provide resilience does not instead create avoidable uncertainty for customers.
I've got a few questions for the minister. First, what assessment has been made of the likely pattern of cancellations under these rules and whether certain groups of passengers are more likely to be affected than others?Secondly, what discussions has the department had with airports about the impact of these arrangements on their income, operations and resilience, particularly given that there were two airlines, as I understand it, that opposed this. But as I understand it, the airports across the board were against this proposal. Thirdly, what evidence led the government to settle on this particular threshold?Um, when airlines had sought a different level of alleviation, um and then also just a point of clarity, I note the instrument is made under powers in the retained EU law Revocation and Reform Act 23.
Um can the Minister confirm precisely how these powers interact with the timetable of these regulations. Um and finally, but by no means least, I return to the passenger impact again. We understand why the government is seeking to avoid unnecessary flights being operated simply by simply in order to retain these slots. The answer cannot be to shift the cost of uncertainty onto travellers. If an airline believes it cannot operate a slot, there must be a clear and fair mechanism for dealing with that in a way that protects consumers as far as possible.
So for that reason, while we recognise the intention behind the regulations, we have some skepticism, um, that this is not entirely the right balance, but I look forward to hearing more persuasive arguments from the noble Lord. The minister.
These regulations amend the slot usage rules so that airlines at specified UK airports can return a limited proportion of slots for the summer and winter 26 seasons. We understand the case for the flexibility during a period of considerable uncertainty, including and in particular, the conflict in the Middle East. And we don't want airlines to be incentivised to operate empty or near empty flights simply to preserve the historic slot rights. Described by the noble Lord Kirkhope. That said, flexibility, in our view, mustn't come at the expense of the passengers.
Even where there is some notice. These changes, we fear, can still lead to cancellations with relatively little little warning causing significant disruption to travel plans in a period when household budgets are under pressure and fares remain high. That can mean higher replacement costs for families, as well as losses on hotels, onward travel and other arrangements already paid for. Um, and I noticed that, for instance, train tickets is an example that's laid out in the fifth question of appendix one of the Department of Transport's answers to the Secondary Legislation Scrutiny Committee.
Um, and it's that's a very good example of what I'm talking about here. There is to a broader question of balance. The airline sector is under pressure, and we recognise the need to support its long term sustainability. But we worry that the burden of adjustment should not fall unfairly on passengers, especially leisure travellers who are less able to absorb sudden change. And we feel we need to be careful that a measure intended to provide resilience does not instead create avoidable uncertainty for customers.
I've got a few questions for the minister. First, what assessment has been made of the likely pattern of cancellations under these rules and whether certain groups of passengers are more likely to be affected than others?Secondly, what discussions has the department had with airports about the impact of these arrangements on their income, operations and resilience, particularly given that there were two airlines, as I understand it, that opposed this. But as I understand it, the airports across the board were against this proposal. Thirdly, what evidence led the government to settle on this particular threshold?Um, when airlines had sought a different level of alleviation, um and then also just a point of clarity, I note the instrument is made under powers in the retained EU law Revocation and Reform Act 23.
Um can the Minister confirm precisely how these powers interact with the timetable of these regulations. Um and finally, but by no means least, I return to the passenger impact again. We understand why the government is seeking to avoid unnecessary flights being operated simply by simply in order to retain these slots. The answer cannot be to shift the cost of uncertainty onto travellers. If an airline believes it cannot operate a slot, there must be a clear and fair mechanism for dealing with that in a way that protects consumers as far as possible.
So for that reason, while we recognise the intention behind the regulations, we have some skepticism, um, that this is not entirely the right balance, but I look forward to hearing more persuasive arguments from the noble Lord. The minister.
17:11
Speaker 5
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Speaker 5
Been meaning to speak. I apologize to everybody for speaking out of turn, but the noble lady's questions have just prompted two questions, if I may, uh, from from me. Um, flight cancellations were trailed for about the last two months in the press, and I declare an interest because I'm due to fly away in August and September. Like I'm sure many families will have arranged their holidays and we haven't seen these cancellations yet. But could the noble Lord confirm that?That's because this regulation has not yet been adopted.
So once it's been adopted, that will happen. And my second question, um, flows naturally from what the noble lady, Baroness Grender, asked. Um the impact on, on consumers. Obviously this regulation, the regulations before us give um the airlines the power to cancel the slots for a temporary period and give passengers 14 days notice. Um, passengers used to be covered by the EU um package. Directive, which of course is a different department to this. I don't know if that's still the case, but it would be great if the noble Lord could, could, could write to me on that.
But the noble Lord will know that if in July or August, September, which is the peak holiday season for school holidays, your flight is cancelled, the chance of you booking another flight for a price similar to that which was originally booked, is nil. So there are going to be huge on costs. And I don't know if that's something the department has an answer for, and probably the chance of finding accommodation will be very slim at an alternative date. Is that something the department is aware of that there will be some very, very deeply unhappy families that might be affected in that way.
So once it's been adopted, that will happen. And my second question, um, flows naturally from what the noble lady, Baroness Grender, asked. Um the impact on, on consumers. Obviously this regulation, the regulations before us give um the airlines the power to cancel the slots for a temporary period and give passengers 14 days notice. Um, passengers used to be covered by the EU um package. Directive, which of course is a different department to this. I don't know if that's still the case, but it would be great if the noble Lord could, could, could write to me on that.
But the noble Lord will know that if in July or August, September, which is the peak holiday season for school holidays, your flight is cancelled, the chance of you booking another flight for a price similar to that which was originally booked, is nil. So there are going to be huge on costs. And I don't know if that's something the department has an answer for, and probably the chance of finding accommodation will be very slim at an alternative date. Is that something the department is aware of that there will be some very, very deeply unhappy families that might be affected in that way.
17:13
Speaker 3
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Speaker 3
My Lords, I've cast my remarks mainly in the form of a series of questions. But before I come to the first question, can I just say that the noble Baroness, my noble friend lady McIntosh of Pickering, has put her finger on a very important point. The effect of these regulations is to transfer potential costs that would fall on airlines to passengers and to airports. Now, there may be very good reason why you want to protect the airlines in this way, but one has to recognise that is the economic effect of what is happening.
If you can cancel a flight with no penalty, then of course the circumstances described by my noble friend arise in relation to families. But there are also problems in relation to airports because they have no revenue from that flight and other connecting flights are discombobulated, if I may put it that way. Um, as a consequence. Now, it is true that um, they're given by these regulations, a 14 day window in which to reallocate the flight. My understanding is when the instrument was first drafted and consulted on, they would not have been allowed to reallocate them at all.
So the 14 days is a concession to their interests. But quite seriously. No, no large airline is going to decide to operate a service at 14 days notice because they're not going to have any passengers. The passengers won't know about it sufficiently in advance, except in extreme circumstances. So I do. I do just want everyone to understand this is what is happening. Airline potential airline costs are being transferred to passengers and to airports. I come to my questions now.
My first question has been answered already by the noble Lord, but it's important to repeat it just to secure it as a starting point for for what we're discussing. It was going to be is there a fuel shortage?Is it the government's position that there is or is not a fuel shortage?And the noble Lord, the minister answered that voluntarily on his own initiative right at the outset, it is the government's position that there is not a fuel shortage. So what is the logic for having this measure, which, as I say, significantly moves costs around the system?What is the logic of having it?The first is, as I understood the noble Lord, that something may happen and we need to be prepared.
The second is, and I regard the second. And it's always true, of course, that something may happen. And we need to be prepared. Um, I'm not disputing that, but I just want to say in that connection that the body referred to by my noble friend Lord Kerkhove of Harrogate, the company which allocates slots, the independent company that allocates slots, already has emergency powers to, to, to create this sort of alleviation. No airline loses a slot because it because it can't fly to a destination where there is a threat of being hit by a bomb.
You don't fly, but you don't lose the slot. The alleviation comes with it because of the circumstances. No airline loses a slot because there's no fuel to put in the tank. That would be absurd. And so this system already exists in many ways, and it's very difficult to know what the government is doing in setting this about. Now. There was another reason given, and I regard this as something of a chimera, because I'm not aware of any evidence to support it, and that is that if this measure is not in place, put in place, there will be a lot of empty planes flying around or a certain number of empty planes flying around, which we'd all agree is an absurdity and not good for the environment or the economy.
Um. However, there isn't any great evidence that that is happening and the slot system already has, as I say, the flexibility that could help deal with that. Next question is why did the government issue these regulations after such a brief consultation?There was a consultation, but it was extremely brief and it came with no warning. Although the government is in regular dialogue with airlines and airports, there was no warning of this instrument appearing. Um, I'd also like to know, and it was a question.
It's on my list, but it was raised by the noble Baroness, Lady Grender, I think. And I'd just like to reinforce it. The government said the minister, noble Lord said that airlines did say in the consultation that they'd like to have a greater alleviation than 10%, but this was rejected by the department because they offered no evidence to support it. But what was the evidence on which the government settled on?10%?Will the government publish the evidence?Presumably, they had the evidence to justify 10%.
And those asking for 15 or 20 or whatever it was they were asking for, we know, didn't have any evidence. But what constitutes the evidence that would that would fit that box?And what was the government's evidence that it was that it was doing that?Now, I think that's one of the things the noble Baroness was trying to get at. So may we see that, maybe see that evidence?My own view is that the urgency in doing this is fundamentally and come back to something that was discussed in Grand Committee a little.
While ago is fundamentally to do with the Powers gap. This is a scandalous lack of attention that the government has given to the perfectly well known fact that a piece of crucial legislation will expire on the 23rd of June. The 23rd of June has been set in stone for at least, well, for several years. Any government could have set out in advance to deal with it. Now the Department of Transport relies on the retained EU Law Act for quite a range of regulatory adjustment, but it will no longer be able to do so.
It will, in relation to slots and aviation, because the Civil Aviation Act is going through your lordships House at the moment and will then go to the other place so that that meets that. But what about the regulation of the marine economy and shipping?There's no provision. None of that can be done. It's dead. It stops unless it's done by Act of Parliament. But every time we ask ministers about this, they just look baffled, as if we were speaking a foreign language.
It is a serious problem that the government is not fronting up to, and it doesn't, as was seen in the previous debate, affect simply the Department for transport. It has consequences across Whitehall. What is the answer to it?What is the government going to do?Um. As I say. I don't understand. There must be a rationale for why the government has made these regulations so favourable to airlines and so damaging to everybody else. How did they how did they get to that point, given that they could, as I say, um, have addressed?I think I've addressed they could have um, relied on the emergency powers of the company.
And I have to admit I, I failed to remember the name of the company at the moment, which allocates the slots. Um. Why in that case also does the alleviation extend to the winter season?One would have thought that the summer season is as far forward as one can reasonably see. And of course, is the point at which there is the greatest stress on the aviation system, greater number of passengers flying, and so forth. So why has the government extended it to the winter season?I also have a question, um, which was.
Tabled by my noble my right hon. Friend um, Richard. Holden MP. The House of Commons, which the Department has failed to answer. And I'm going to repeat it here, if I may, in the hope that the Minister can give me an answer. And he asked the question to ask the Secretary of State for transport whether her Department has made an assessment of the potential merits of introducing formal trigger mechanisms for objective thresholds for future slot alleviation measures relating to aviation fuel disruption.
What we have here is complete Liberty Hall for the airlines. They just have to say, well, cancelling, we're allowed to and we're keeping the slot. We don't have to give a reason. There is no threshold in place. There is no mechanism that justifies this wantonness. Um, why is that?Why did the government decide not to do that?Um, I can't fail to mention the huge damage that's been done to airports by the government's bone crushing, as I call them.
The other day, business rates increases. And I think that the government really has to understand that adding these extra difficulties and costs to the operation of airports is a threat to the to the aviation system in this country. Um. I hope the noble Lord, the minister, can answer those questions. I hope I've been sufficiently clear in answering them. And I hope that those that do not get a full answer today will have will, will be answered in writing afterwards, and that the answer can be shared with other members of the Grand Committee.
If you can cancel a flight with no penalty, then of course the circumstances described by my noble friend arise in relation to families. But there are also problems in relation to airports because they have no revenue from that flight and other connecting flights are discombobulated, if I may put it that way. Um, as a consequence. Now, it is true that um, they're given by these regulations, a 14 day window in which to reallocate the flight. My understanding is when the instrument was first drafted and consulted on, they would not have been allowed to reallocate them at all.
So the 14 days is a concession to their interests. But quite seriously. No, no large airline is going to decide to operate a service at 14 days notice because they're not going to have any passengers. The passengers won't know about it sufficiently in advance, except in extreme circumstances. So I do. I do just want everyone to understand this is what is happening. Airline potential airline costs are being transferred to passengers and to airports. I come to my questions now.
My first question has been answered already by the noble Lord, but it's important to repeat it just to secure it as a starting point for for what we're discussing. It was going to be is there a fuel shortage?Is it the government's position that there is or is not a fuel shortage?And the noble Lord, the minister answered that voluntarily on his own initiative right at the outset, it is the government's position that there is not a fuel shortage. So what is the logic for having this measure, which, as I say, significantly moves costs around the system?What is the logic of having it?The first is, as I understood the noble Lord, that something may happen and we need to be prepared.
The second is, and I regard the second. And it's always true, of course, that something may happen. And we need to be prepared. Um, I'm not disputing that, but I just want to say in that connection that the body referred to by my noble friend Lord Kerkhove of Harrogate, the company which allocates slots, the independent company that allocates slots, already has emergency powers to, to, to create this sort of alleviation. No airline loses a slot because it because it can't fly to a destination where there is a threat of being hit by a bomb.
You don't fly, but you don't lose the slot. The alleviation comes with it because of the circumstances. No airline loses a slot because there's no fuel to put in the tank. That would be absurd. And so this system already exists in many ways, and it's very difficult to know what the government is doing in setting this about. Now. There was another reason given, and I regard this as something of a chimera, because I'm not aware of any evidence to support it, and that is that if this measure is not in place, put in place, there will be a lot of empty planes flying around or a certain number of empty planes flying around, which we'd all agree is an absurdity and not good for the environment or the economy.
Um. However, there isn't any great evidence that that is happening and the slot system already has, as I say, the flexibility that could help deal with that. Next question is why did the government issue these regulations after such a brief consultation?There was a consultation, but it was extremely brief and it came with no warning. Although the government is in regular dialogue with airlines and airports, there was no warning of this instrument appearing. Um, I'd also like to know, and it was a question.
It's on my list, but it was raised by the noble Baroness, Lady Grender, I think. And I'd just like to reinforce it. The government said the minister, noble Lord said that airlines did say in the consultation that they'd like to have a greater alleviation than 10%, but this was rejected by the department because they offered no evidence to support it. But what was the evidence on which the government settled on?10%?Will the government publish the evidence?Presumably, they had the evidence to justify 10%.
And those asking for 15 or 20 or whatever it was they were asking for, we know, didn't have any evidence. But what constitutes the evidence that would that would fit that box?And what was the government's evidence that it was that it was doing that?Now, I think that's one of the things the noble Baroness was trying to get at. So may we see that, maybe see that evidence?My own view is that the urgency in doing this is fundamentally and come back to something that was discussed in Grand Committee a little.
While ago is fundamentally to do with the Powers gap. This is a scandalous lack of attention that the government has given to the perfectly well known fact that a piece of crucial legislation will expire on the 23rd of June. The 23rd of June has been set in stone for at least, well, for several years. Any government could have set out in advance to deal with it. Now the Department of Transport relies on the retained EU Law Act for quite a range of regulatory adjustment, but it will no longer be able to do so.
It will, in relation to slots and aviation, because the Civil Aviation Act is going through your lordships House at the moment and will then go to the other place so that that meets that. But what about the regulation of the marine economy and shipping?There's no provision. None of that can be done. It's dead. It stops unless it's done by Act of Parliament. But every time we ask ministers about this, they just look baffled, as if we were speaking a foreign language.
It is a serious problem that the government is not fronting up to, and it doesn't, as was seen in the previous debate, affect simply the Department for transport. It has consequences across Whitehall. What is the answer to it?What is the government going to do?Um. As I say. I don't understand. There must be a rationale for why the government has made these regulations so favourable to airlines and so damaging to everybody else. How did they how did they get to that point, given that they could, as I say, um, have addressed?I think I've addressed they could have um, relied on the emergency powers of the company.
And I have to admit I, I failed to remember the name of the company at the moment, which allocates the slots. Um. Why in that case also does the alleviation extend to the winter season?One would have thought that the summer season is as far forward as one can reasonably see. And of course, is the point at which there is the greatest stress on the aviation system, greater number of passengers flying, and so forth. So why has the government extended it to the winter season?I also have a question, um, which was.
Tabled by my noble my right hon. Friend um, Richard. Holden MP. The House of Commons, which the Department has failed to answer. And I'm going to repeat it here, if I may, in the hope that the Minister can give me an answer. And he asked the question to ask the Secretary of State for transport whether her Department has made an assessment of the potential merits of introducing formal trigger mechanisms for objective thresholds for future slot alleviation measures relating to aviation fuel disruption.
What we have here is complete Liberty Hall for the airlines. They just have to say, well, cancelling, we're allowed to and we're keeping the slot. We don't have to give a reason. There is no threshold in place. There is no mechanism that justifies this wantonness. Um, why is that?Why did the government decide not to do that?Um, I can't fail to mention the huge damage that's been done to airports by the government's bone crushing, as I call them.
The other day, business rates increases. And I think that the government really has to understand that adding these extra difficulties and costs to the operation of airports is a threat to the to the aviation system in this country. Um. I hope the noble Lord, the minister, can answer those questions. I hope I've been sufficiently clear in answering them. And I hope that those that do not get a full answer today will have will, will be answered in writing afterwards, and that the answer can be shared with other members of the Grand Committee.
17:24
Speaker 8
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Speaker 8
So I'd like to thank all noble Lords for their consideration of these draft regulations and for the thoughtful points raised during the debate. I will attempt to answer as many as I can now, and if I can't answer them now, I will, of course, write to both the. Noble Lord concerned and the. And and the rest of noble lords here at the Grand. Uh, the Grand Committee. I thank the noble Lord Kirkhope of Harrogate, with his considerable experience.
Uh, and, uh, I would say to him, I cannot find in the draft statutory instrument any reference to five year term. The the measure put forward today is only about the summer season 2026 and the winter season. 2026. And of course, he will find. And I no doubt he's studying it. Um, more or less as we speak in the Civil Aviation Bill, the permanent, uh, proposition. For, uh, a slot regulation. So I hope that that will satisfy him.
But if not, we can, uh, we can discuss it afterwards. Um, my understanding about the, about the changes that, uh, to or airport, my understanding about the three types of airport and what might trigger a change between the categorisation is that it's triggered by the airport itself, and it's triggered by the level of potential use and therefore congestion. Um, the, uh, the company itself, uh, airport Coordination Limited is clearly very efficient with 40 employees. Um, but I think that there's a wider point, which goes to some of the questions, which is that a lot of this is about the stability of a, of.
Of, um, both the. Airline and the airport sector. Um, we're good at this in Britain and we want our, we, we want the, the airline sector to prosper and we have to give it some stability in circumstances in which the international situation has destabilized it a bit. Um, I can't answer the noble Lord Grayling about the impact of individual airlines. He's clearly right that airlines that fly directly to the Middle East will be more affected than perhaps ones that don't at all.
Um, but actually the impact both of the wider geopolitical circumstances and of any potential fuel fuel surplus on fuel shortage, I'm very happy to, uh, to confirm that the government does not believe currently that there's an air that. There's an airline fuel shortage, but there could be in future. And if there is, we need to make adequate preparation in advance for it. Um, and, uh, it's quite hard to know where that might apply. Um, so we have to apply some general, uh, general thought to how we manage this and a lot of what's going on here is to give some stability and certainty to the ability of airlines, both to resume normal business when they can, and also proportionately, what happens to airports who rely on a throughput of passengers?Um.
Uh, and, uh, I would say to him, I cannot find in the draft statutory instrument any reference to five year term. The the measure put forward today is only about the summer season 2026 and the winter season. 2026. And of course, he will find. And I no doubt he's studying it. Um, more or less as we speak in the Civil Aviation Bill, the permanent, uh, proposition. For, uh, a slot regulation. So I hope that that will satisfy him.
But if not, we can, uh, we can discuss it afterwards. Um, my understanding about the, about the changes that, uh, to or airport, my understanding about the three types of airport and what might trigger a change between the categorisation is that it's triggered by the airport itself, and it's triggered by the level of potential use and therefore congestion. Um, the, uh, the company itself, uh, airport Coordination Limited is clearly very efficient with 40 employees. Um, but I think that there's a wider point, which goes to some of the questions, which is that a lot of this is about the stability of a, of.
Of, um, both the. Airline and the airport sector. Um, we're good at this in Britain and we want our, we, we want the, the airline sector to prosper and we have to give it some stability in circumstances in which the international situation has destabilized it a bit. Um, I can't answer the noble Lord Grayling about the impact of individual airlines. He's clearly right that airlines that fly directly to the Middle East will be more affected than perhaps ones that don't at all.
Um, but actually the impact both of the wider geopolitical circumstances and of any potential fuel fuel surplus on fuel shortage, I'm very happy to, uh, to confirm that the government does not believe currently that there's an air that. There's an airline fuel shortage, but there could be in future. And if there is, we need to make adequate preparation in advance for it. Um, and, uh, it's quite hard to know where that might apply. Um, so we have to apply some general, uh, general thought to how we manage this and a lot of what's going on here is to give some stability and certainty to the ability of airlines, both to resume normal business when they can, and also proportionately, what happens to airports who rely on a throughput of passengers?Um.
17:27
Speaker 10
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Speaker 10
From, from this point, the, the question I raised with him is absolutely central to the government's decision to take a 5 or 10% figure. Uh, he said that the airlines wanted more. I explained a very specific circumstance where one particular airline and there will be many others affected in that way would need more. He does need to explain, therefore, why the government has fixed on this figure. When the airlines said that wasn't the right figure, and when common sense says many would need more.
17:27
17:28
Speaker 10
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Speaker 10
I'm not really very interested in what the airlines said they wanted because the department took the decision to alight on a particular figure. And what he hasn't explained is why the department took that decision when simple common sense would say that that many, many airlines would need a different figure because the basic arithmetic I described to him earlier.
17:28
Speaker 8
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Speaker 8
I think the answer to that point, whether or not it satisfies the noble Lord, is, is that we have to do something in general in these circumstances. Um, and previous circumstances of various sorts have produced different figures. Uh, the Covid figure of 30% was, was clearly another figure. I don't know how that was calculated. Um, but we, we feel the need to do something because we have to give some certainty both to airlines and to our potential airline passengers. I take his point about the geographical differences, and I will certainly go away and, and write to him further about what individual airlines in those circumstances said.
Um, I've no evidence that certain airlines were, uh, said, uh, proposed huge. Differences, but I'll certainly go away and, and find out what, what what what what that is, um, the, uh, I will write to the noble, Viscount Stansgate about the experience of the 30% hand back in 2022. Uh, the noble Baroness Grender raised the question about whether some groups of passengers are more affected by this than others. We don't have any current evidence that that might be the case. It's clearly one can clearly envisage that this might affect some more than others.
But the. But the argument for doing this is to give some certainty in advance about the effect of it. Rather than find last minute flight cancellations. Um and, uh, what, what we do know is that actually airlines are keen on keeping their slots. They work very hard to make sure that they keep their slots. And what we don't want is short term bad effects on passengers and airline schedules. But thereafter, people making up their 80% by flights, which are near empty in order to keep the slots that they otherwise that they otherwise would, would lose.
Um, I will, if I may write to the noble Baroness McIntosh of Pickering, because I can't immediately answer her questions other than to say that flight cancellations have been trailed in the press. There are some um, but actually this is a way of making sure that airlines are able to better manage in circumstances where we don't yet know what will happen in the summer and, and on, on with the winter. Um, I've said that the government believes that there's no current fuel shortage that may change, but the international situation may change.
And I do think it's sensible to take a view of this. I absolutely take the point that it may not suit passengers to get 14 days notice, but it would be better than passengers getting virtually virtually. No, uh, no notice. Um, the noble Lord Moylan asked. I've I've answered some other points already. He asked about, um, a brief consultation with no warning. Um, but I think it's fair to say that actually the situation in the Middle East of blew up with no warning, and I think in the circumstances the government should should react.
Um, and he knows about the arguments about retained EU law. All I'll say for now is that actually um he said we had no future plans for this, but the Civil aviation bill, at least in, in, in, in the circumstances of aviation is to replace those powers. And in the meantime, the government feels the need to bring this forward simply to give some certainty in the summer and winter schedules for both airlines and passengers, the airline industry in Britain and travel to and from Britain does need some certainty, because a lot of our international trade depends on it, and this measure is designed to give it some certainty in circumstances where the geopolitical situation across the world is, is relatively uncertain.
Um, I don't have an answer to him about the question that he raised, which has come from the other place, but I will attempt to answer it in, in writing. Um, and I do think that we are trying to do our best for an industry both in airlines and airports, um, which, which is affected by some, some very difficult headwinds. My Lords, these regulations, we believe, represent a practical and proportionate response to this period of uncertainty for the whole sector. They do protect they will protect passengers by enabling greater certainty in earlier communication.
They support airlines in maintaining viable and realistic schedules, and they help to ensure that scarce airport capacity is used efficiently and responsibly. And above all, they demonstrate the government is forward looking and acting early to prevent disruption rather than responding reactively. I beg. I beg to move.
Um, I've no evidence that certain airlines were, uh, said, uh, proposed huge. Differences, but I'll certainly go away and, and find out what, what what what what that is, um, the, uh, I will write to the noble, Viscount Stansgate about the experience of the 30% hand back in 2022. Uh, the noble Baroness Grender raised the question about whether some groups of passengers are more affected by this than others. We don't have any current evidence that that might be the case. It's clearly one can clearly envisage that this might affect some more than others.
But the. But the argument for doing this is to give some certainty in advance about the effect of it. Rather than find last minute flight cancellations. Um and, uh, what, what we do know is that actually airlines are keen on keeping their slots. They work very hard to make sure that they keep their slots. And what we don't want is short term bad effects on passengers and airline schedules. But thereafter, people making up their 80% by flights, which are near empty in order to keep the slots that they otherwise that they otherwise would, would lose.
Um, I will, if I may write to the noble Baroness McIntosh of Pickering, because I can't immediately answer her questions other than to say that flight cancellations have been trailed in the press. There are some um, but actually this is a way of making sure that airlines are able to better manage in circumstances where we don't yet know what will happen in the summer and, and on, on with the winter. Um, I've said that the government believes that there's no current fuel shortage that may change, but the international situation may change.
And I do think it's sensible to take a view of this. I absolutely take the point that it may not suit passengers to get 14 days notice, but it would be better than passengers getting virtually virtually. No, uh, no notice. Um, the noble Lord Moylan asked. I've I've answered some other points already. He asked about, um, a brief consultation with no warning. Um, but I think it's fair to say that actually the situation in the Middle East of blew up with no warning, and I think in the circumstances the government should should react.
Um, and he knows about the arguments about retained EU law. All I'll say for now is that actually um he said we had no future plans for this, but the Civil aviation bill, at least in, in, in, in the circumstances of aviation is to replace those powers. And in the meantime, the government feels the need to bring this forward simply to give some certainty in the summer and winter schedules for both airlines and passengers, the airline industry in Britain and travel to and from Britain does need some certainty, because a lot of our international trade depends on it, and this measure is designed to give it some certainty in circumstances where the geopolitical situation across the world is, is relatively uncertain.
Um, I don't have an answer to him about the question that he raised, which has come from the other place, but I will attempt to answer it in, in writing. Um, and I do think that we are trying to do our best for an industry both in airlines and airports, um, which, which is affected by some, some very difficult headwinds. My Lords, these regulations, we believe, represent a practical and proportionate response to this period of uncertainty for the whole sector. They do protect they will protect passengers by enabling greater certainty in earlier communication.
They support airlines in maintaining viable and realistic schedules, and they help to ensure that scarce airport capacity is used efficiently and responsibly. And above all, they demonstrate the government is forward looking and acting early to prevent disruption rather than responding reactively. I beg. I beg to move.
17:33
17:35
Speaker 12
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Speaker 12
My Lords, I beg to move that the committee consider the marine Licensing miscellaneous provisions, amendment, Order 2026, which was laid before this House on 15th of April 2026. This statutory instrument is one of the legislative measures being taken to implement the UK's obligations under the Bbng agreement, which is, of course, the agreement under the United Nations Convention on the law of the sea on the Conservation and Sustainable Use of Marine Biological diversity of areas beyond national jurisdiction. It helps implement the UK's obligations in relation to environmental impact assessments for activities carried on in areas beyond national jurisdiction, within the remit of marine licensing, the UK must be able to meet all its obligations under the Bbng agreement before it can ratify it.
So this statute statutory instrument will help enable this through amendments to the marine licensing regime. Before turning to the detail of the statutory instrument, I want to begin by underlining why it's so important that this House supports progressing this legislation. Bbng agreement is an implementing agreement under the UN convention on the law of the sea. It aims to support the conservation and sustainable use of marine biodiversity in areas beyond national jurisdiction. This is a landmark international agreement that creates a legal framework to protect the two thirds of the ocean that lies beyond any nation's jurisdiction.
These vast waters contain extraordinary biodiversity and ecosystems that are vital to the health of our planet and are home to sharks, whales, sea turtles and countless other species. Primary legislation was needed in order to implement fully our bbng obligations, and accordingly, the Bbng bill was introduced last year and received Royal Assent on the 12th of February 2026 and makes a significant milestone in our journey towards ratification. So we're now taking forward the secondary legislation that's needed for the UK to fully implement the agreement. This instrument is part of that work and it needs to be made before the UK can ratify the agreement and participate fully in the first conference of the parties, and we are expecting the first conference of the parties to take place in January 2027.
So this instrument helps implement the UK's obligations under part four of the agreement, which requires environmental impact assessments for activities taking place in areas beyond national jurisdiction that could have a significant impact on the marine environment. Under the agreement, the UK is required to ensure that the potential environmental impacts of any planned activity in these areas are suitably assessed before a decision is taken to authorise the activity. This instrument makes provision relating to activities carried out in areas beyond national jurisdiction, so that environmental impacts can be suitably considered in line with these obligations.
Currently, a small number of activities involving deposits, scuttling and incarceration incineration are already licensable in areas beyond national jurisdiction. But only two marine licences have been issued to date for such activities since 2011. This instrument extends the marine licensing regime to additional activities carried out in areas beyond national jurisdiction. These new activities correspond to types of activity which are already licensable when carried out in UK waters, such as construction or removal activities. Licensable activities carried out in areas beyond national jurisdiction will include those that are carried out or controlled by UK persons, as well as activities undertaken from British vessels, aircraft, marine structures or floating containers.
This instrument also makes a number of amendments to the marine Licensing Exempted Activities Order of 2011. An exemption is added so that several of the new activities will not require a marine licence, where they do not meet the threshold for needing an environmental impact assessment or a screening for an environmental impact assessment, as set out in the Bbng agreement. Reduces the burden on regulators and industry while still ensuring we can meet bbng obligations by enabling the new activities to be assessed first to determine if they are lower impact or need a full environmental impact assessment.
An exemption is also introduced for the removal of specific subsea cables carried out in areas beyond national jurisdiction. The removal of these cables has a low environmental impact and is considered to consistently fall below the bbng screening threshold. Alongside this instrument, I would like to highlight the Marine Licensing Miscellanea Amendment Scotland Order 2026, which makes corresponding provision for activities within Scottish competence. These are activities which are regulated by the Scottish Government under devolved powers. The Scottish Instrument adds new licensable activities to the licensing regime under the Marine Scotland Act 2010, and makes other changes to that regime.
This ensures that the Scottish licensing framework aligns with the United Kingdom's obligations under the Bbng agreement. The Scottish order was made in March 2026 and will come into force on the same day as the Bbng agreement enters into force for the United Kingdom to avoid dual regulation, so a marine licence is not required under both our licensing regime and the Scottish Government's marine licensing regime for the same activity. This instrument provides for an exemption in relation to certain activities that are regulated under part four of the Marine Scotland Act 2010 and.
This instrument also makes consequential amendments to ensure that existing exemptions and registration provisions can apply appropriately to activities in areas beyond national jurisdiction. This statutory instrument implements the necessary changes to marine licensing to enable the ratification of the Bbng agreement. We are confident its provisions will improve environmental protections in areas beyond national jurisdiction, while avoiding unnecessary regulatory burden. I beg to move.
So this statute statutory instrument will help enable this through amendments to the marine licensing regime. Before turning to the detail of the statutory instrument, I want to begin by underlining why it's so important that this House supports progressing this legislation. Bbng agreement is an implementing agreement under the UN convention on the law of the sea. It aims to support the conservation and sustainable use of marine biodiversity in areas beyond national jurisdiction. This is a landmark international agreement that creates a legal framework to protect the two thirds of the ocean that lies beyond any nation's jurisdiction.
These vast waters contain extraordinary biodiversity and ecosystems that are vital to the health of our planet and are home to sharks, whales, sea turtles and countless other species. Primary legislation was needed in order to implement fully our bbng obligations, and accordingly, the Bbng bill was introduced last year and received Royal Assent on the 12th of February 2026 and makes a significant milestone in our journey towards ratification. So we're now taking forward the secondary legislation that's needed for the UK to fully implement the agreement. This instrument is part of that work and it needs to be made before the UK can ratify the agreement and participate fully in the first conference of the parties, and we are expecting the first conference of the parties to take place in January 2027.
So this instrument helps implement the UK's obligations under part four of the agreement, which requires environmental impact assessments for activities taking place in areas beyond national jurisdiction that could have a significant impact on the marine environment. Under the agreement, the UK is required to ensure that the potential environmental impacts of any planned activity in these areas are suitably assessed before a decision is taken to authorise the activity. This instrument makes provision relating to activities carried out in areas beyond national jurisdiction, so that environmental impacts can be suitably considered in line with these obligations.
Currently, a small number of activities involving deposits, scuttling and incarceration incineration are already licensable in areas beyond national jurisdiction. But only two marine licences have been issued to date for such activities since 2011. This instrument extends the marine licensing regime to additional activities carried out in areas beyond national jurisdiction. These new activities correspond to types of activity which are already licensable when carried out in UK waters, such as construction or removal activities. Licensable activities carried out in areas beyond national jurisdiction will include those that are carried out or controlled by UK persons, as well as activities undertaken from British vessels, aircraft, marine structures or floating containers.
This instrument also makes a number of amendments to the marine Licensing Exempted Activities Order of 2011. An exemption is added so that several of the new activities will not require a marine licence, where they do not meet the threshold for needing an environmental impact assessment or a screening for an environmental impact assessment, as set out in the Bbng agreement. Reduces the burden on regulators and industry while still ensuring we can meet bbng obligations by enabling the new activities to be assessed first to determine if they are lower impact or need a full environmental impact assessment.
An exemption is also introduced for the removal of specific subsea cables carried out in areas beyond national jurisdiction. The removal of these cables has a low environmental impact and is considered to consistently fall below the bbng screening threshold. Alongside this instrument, I would like to highlight the Marine Licensing Miscellanea Amendment Scotland Order 2026, which makes corresponding provision for activities within Scottish competence. These are activities which are regulated by the Scottish Government under devolved powers. The Scottish Instrument adds new licensable activities to the licensing regime under the Marine Scotland Act 2010, and makes other changes to that regime.
This ensures that the Scottish licensing framework aligns with the United Kingdom's obligations under the Bbng agreement. The Scottish order was made in March 2026 and will come into force on the same day as the Bbng agreement enters into force for the United Kingdom to avoid dual regulation, so a marine licence is not required under both our licensing regime and the Scottish Government's marine licensing regime for the same activity. This instrument provides for an exemption in relation to certain activities that are regulated under part four of the Marine Scotland Act 2010 and.
This instrument also makes consequential amendments to ensure that existing exemptions and registration provisions can apply appropriately to activities in areas beyond national jurisdiction. This statutory instrument implements the necessary changes to marine licensing to enable the ratification of the Bbng agreement. We are confident its provisions will improve environmental protections in areas beyond national jurisdiction, while avoiding unnecessary regulatory burden. I beg to move.
17:42
17:42
Speaker 6
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Speaker 6
My Lords, um. I thank the noble lady, the Minister, for setting out this statutory instrument. Uh, we support the implementation of the biodiversity beyond national jurisdiction. Jurisdiction BNJ agreement and welcome this, see which enables the United Kingdom to meet its international obligations under the Global Oceans Treaty. We have long campaigned for stronger protection of the marine environment and support international action to conserve biodiversity in areas that, until now, have been beyond national jurisdiction, including the global goal of protecting 30% of the world's oceans by 2030, we note the sea introduces a number of licensing exemptions for activities that the government considers to pose a low environmental risk, such as the removal of cables as described by the noble Baroness, the minister.
And while we recognise the need for a proportionate and workable regulatory framework, we do believe it will be important that these exemptions are kept under regular review and do not undermine effective environmental oversight as activity in areas beyond national jurisdiction develop over time. And whilst we support the implementation of this treaty and this s, I remain clear that the government must ensure the new licensing exemptions do not, in turn, become loopholes in the future, and that regulators are properly resourced to enforce the agreement effectively. And there are aspects we think, um, that warrant, um, a bit of closer scrutiny, in particular the new exemptions introduced through articles 39, 40, 41.
Those raised questions about the breadth of the regime, the exemption where a screening opinion concludes that an environmental impact assessment is not required. Whilst we understand that in principle, it does rest heavily on an assumption of low environmental risk and and the current low volume of applications. When I did read up on this, I was absolutely mesmerized by the fact that there are only two licences in existence at the moment. It's quite a large statutory instrument for just two operators. Um, while only a small number of applications have been received to date, that position may change.
There may be a discovery. And and this is, I guess, what the government is trying to do, which is be ahead of the curve of, um a sudden gold rush in effect of dredging for essential minerals that are in, in the deep, deep ocean. Um, and so, um, I congratulate the government for being, this feels a bit ahead of the curve. And that's really unusual. Um, so that's good. Although I do notice that the secondary legislation scrutiny committee felt that the UK in itself was a little bit behind the curve in comparison with 1 or 2 other countries.
Similarly, I thank the noble lady, the Minister, for setting out that article 40 seeks to avoid dual regulation with the Marine Scotland Act 2010. Um, obviously, we worry that the reliance on administrative coordination and guidance, rather than more clearly defined statutory boundaries, might reduce transparency and consistency over time. There might be a risk on that. Uh, against that background, I would be grateful if the minister could address these points first. What additional resource will be provided?Say there is a gold rush, as I've described for the Marine Management Organisation, to support the monitoring and enforcement.
If it picks up to more than just the two licences described. Secondly, why does the instrument not include a more specific review mechanism, given the pace of technological change in deep sea activities?And third, how will the government ensure that the exemption in article 39 does not allow activities with uncertain or poorly understood impacts to proceed without full licensing scrutiny?So overall, we support the objectives of this instrument, its effectiveness will depend on how these provisions operate in practice, greater clarity on resourcing, review and the application of exemptions would help to ensure that the regime remains robust, as in case activity increases.
And while we recognise the need for a proportionate and workable regulatory framework, we do believe it will be important that these exemptions are kept under regular review and do not undermine effective environmental oversight as activity in areas beyond national jurisdiction develop over time. And whilst we support the implementation of this treaty and this s, I remain clear that the government must ensure the new licensing exemptions do not, in turn, become loopholes in the future, and that regulators are properly resourced to enforce the agreement effectively. And there are aspects we think, um, that warrant, um, a bit of closer scrutiny, in particular the new exemptions introduced through articles 39, 40, 41.
Those raised questions about the breadth of the regime, the exemption where a screening opinion concludes that an environmental impact assessment is not required. Whilst we understand that in principle, it does rest heavily on an assumption of low environmental risk and and the current low volume of applications. When I did read up on this, I was absolutely mesmerized by the fact that there are only two licences in existence at the moment. It's quite a large statutory instrument for just two operators. Um, while only a small number of applications have been received to date, that position may change.
There may be a discovery. And and this is, I guess, what the government is trying to do, which is be ahead of the curve of, um a sudden gold rush in effect of dredging for essential minerals that are in, in the deep, deep ocean. Um, and so, um, I congratulate the government for being, this feels a bit ahead of the curve. And that's really unusual. Um, so that's good. Although I do notice that the secondary legislation scrutiny committee felt that the UK in itself was a little bit behind the curve in comparison with 1 or 2 other countries.
Similarly, I thank the noble lady, the Minister, for setting out that article 40 seeks to avoid dual regulation with the Marine Scotland Act 2010. Um, obviously, we worry that the reliance on administrative coordination and guidance, rather than more clearly defined statutory boundaries, might reduce transparency and consistency over time. There might be a risk on that. Uh, against that background, I would be grateful if the minister could address these points first. What additional resource will be provided?Say there is a gold rush, as I've described for the Marine Management Organisation, to support the monitoring and enforcement.
If it picks up to more than just the two licences described. Secondly, why does the instrument not include a more specific review mechanism, given the pace of technological change in deep sea activities?And third, how will the government ensure that the exemption in article 39 does not allow activities with uncertain or poorly understood impacts to proceed without full licensing scrutiny?So overall, we support the objectives of this instrument, its effectiveness will depend on how these provisions operate in practice, greater clarity on resourcing, review and the application of exemptions would help to ensure that the regime remains robust, as in case activity increases.
17:46
Speaker 13
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Speaker 13
La laFor bringing forward this important SI2 thirds of the world's ocean lie beyond any nation's jurisdiction, and so it is crucial that we support international cooperation and take our own responsibilities and opportunities for action seriously. That is why the previous conservative government played a leading role in negotiating the biodiversity beyond national jurisdiction agreement. In our waters, we have established 296 marine protection areas. We established the Blue Belt programme and backed our overseas territories. Indeed the UK overseas territories are estimated to be home to about 94% of all known UK biodiversity, and we must take their role very seriously.
This secondary legislation follows the Biodiversity Beyond National Jurisdiction Act to ensure compliance with the treaty, specifically regarding environmental impact assessments for activities which require a licence and for which the Marine Management Organisation, on behalf of the Secretary of State, is a licensing authority. This will ensure that potential economic potential environmental impacts are assessed before activity in areas under the UK's control are approved. The Official Opposition, therefore, welcomes the regulation, but more broadly, however, the government does not seem to be taking its role seriously. Until recently, the government was determined to give away the Chagos Islands to Mauritius and pay for the privilege, despite concerns about their ability to protect precious marine biodiversity around the Chagos Archipelago, the Chagos Islands MPA was designated in 2010 and is home to coral reefs and 76 species on the International Union for Conservation of Nature's Red List of Threatened Species.
But sadly, the government does not take the UK's international law seriously and was prepared to give this all away with the Chinese shipping, emperors would pillage every inch of that ocean. Closer to home, the government decided last year to grant the EU 12 years of continuous access to UK fishing waters, despite concerns of overfishing and concerns from the UK fishing industry. Indeed, one organisation described the deal as, quote, a horror show for Scottish fishermen unquote. My Lords, when the government shows a disregard for our own sovereign territory, marine life suffers as a result.
Not to mention the other financial costs to our economy and public finances. As these regulations come to pass. To help us meet the BB ng agreements, obligations in full, I urge the government to reflect on how it is living up to the UK's international role in other areas too. If we are expected to be responsible for areas beyond national jurisdiction, that means taking even more seriously our own sovereign territory overseas. What assurances can the noble Baroness, the Minister, give that UK fishing waters will not be harmed further in the government's plan?E UK, EU reset what further steps is the government taking to protect marine life in and around overseas territories?I look forward to hearing from the noble Baroness, the Minister, but I commend and welcome these regulations.
This secondary legislation follows the Biodiversity Beyond National Jurisdiction Act to ensure compliance with the treaty, specifically regarding environmental impact assessments for activities which require a licence and for which the Marine Management Organisation, on behalf of the Secretary of State, is a licensing authority. This will ensure that potential economic potential environmental impacts are assessed before activity in areas under the UK's control are approved. The Official Opposition, therefore, welcomes the regulation, but more broadly, however, the government does not seem to be taking its role seriously. Until recently, the government was determined to give away the Chagos Islands to Mauritius and pay for the privilege, despite concerns about their ability to protect precious marine biodiversity around the Chagos Archipelago, the Chagos Islands MPA was designated in 2010 and is home to coral reefs and 76 species on the International Union for Conservation of Nature's Red List of Threatened Species.
But sadly, the government does not take the UK's international law seriously and was prepared to give this all away with the Chinese shipping, emperors would pillage every inch of that ocean. Closer to home, the government decided last year to grant the EU 12 years of continuous access to UK fishing waters, despite concerns of overfishing and concerns from the UK fishing industry. Indeed, one organisation described the deal as, quote, a horror show for Scottish fishermen unquote. My Lords, when the government shows a disregard for our own sovereign territory, marine life suffers as a result.
Not to mention the other financial costs to our economy and public finances. As these regulations come to pass. To help us meet the BB ng agreements, obligations in full, I urge the government to reflect on how it is living up to the UK's international role in other areas too. If we are expected to be responsible for areas beyond national jurisdiction, that means taking even more seriously our own sovereign territory overseas. What assurances can the noble Baroness, the Minister, give that UK fishing waters will not be harmed further in the government's plan?E UK, EU reset what further steps is the government taking to protect marine life in and around overseas territories?I look forward to hearing from the noble Baroness, the Minister, but I commend and welcome these regulations.
17:49
Speaker 12
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Speaker 12
Sorry. Oops. I didn't mean to smash the joint. Apologies. Um, so thanks very much to noble lords who've taken part. It's been a sort of short but sweet debate. I would, suggest, but, um, I am. Pleased that noble lords have fundamentally supported this, uh, this statutory instrument because it is an important statutory instrument. We do need to ratify the agreement. So I thank noble Lords for their broad support.
Uh, just looking at some of the issues that came up, I know that the noble lady is going to talk about, um, enforcement and resources, etc. so, um, on enforcement, the, the Marine management organisations enforcement strategy does include a range of tools and that includes advisory letters, formal enforcement action. And what we want to do is apply any enforcement proportionately on risk and evidence. We can place conditions on licences which require licence holders to keep records and make returns, or provide information to the Marine Management Organisation.
But we're also looking at how the MMO can develop intelligent gateways in areas beyond national jurisdiction to be able to assess where there may be non-licensed activity taking place and how to to address that. Um, but regarding non-compliance, any breach of the licence terms and conditions may lead to enforcement action being taken. That can include variation, revocation or suspension of the licence, the issuing of an enforcement notice, civil penalties or indeed criminal proceedings. And they can carry a maximum penalty of an unlimited fine and a term of imprisonment of up to two years um on resources.
The MMO charges for licence applications on a cost recovery basis and applications under BNG will be charged at the highest band three hourly rate. Um, and while the MMO applies a cost recovery approach, not all costs are currently recovered through this mechanism, and the remainder are covered by grant in aid funding. So what we're looking is, is moving towards full cost recovery. Um, in order to, to, to, to get to that place. Um, the noble lady mentioned that there had only been two applications for a licence in an activity in areas beyond national jurisdiction.
They were the Virgin orbit launch of the noble aid is aware of that. Did ask about how we could increase resource if we suddenly have more activity on the basis we're doing on cost recovery basis, that should cover it. But actually, we don't anticipate many activities. Our evidence shows that, um, you know, there's been very few so far. We do have a few case studies. It's difficult to completely assess the volume, but we do not expect much to come forward.
The noble lady mentioned the lack of review. Um, I'm unaware as to whether or not there is a process for that, so I shall I shall pick that up and ask for more information. Um, and I thank the noble Lord, Lord Blencathra, for his comments. I think the specific one that I think I can refer to at the moment is around Chagos. He mentioned the environment around the Chagos Islands. Um, obviously national security is absolutely paramount, but we have secured a deal that will help protect the unique environment of the Chagos Archipelago, the UK and Mauritius have both committed to protecting one of the world's most important marine environments, and the agreement will be supported by an enhanced partnership between the UK and Mauritius, under which the UK will support Mauritius ambitions to establish a marine protected area that protects the globally significant eco ecosystems in Chagos.
We know that this has been welcomed by a conservation NGOs, including the Zoological Society of London and. Both the UK and Mauritius have been working together to attach. You know, really important, you know, great importance on the need to protect marine diversity, including the fight against illegal fishing. Um, so in conclusion, my Lords, this legislation will help ensure the UK can meet its obligations under the Bbng agreement and therefore will be in a position to ratify it while establishing a flexible, proportionate approach to regulating licensable marine activities in areas beyond national jurisdiction.
It's therefore a crucial step in ensuring effective measures that are in place to protect our environment for the future. I beg to move.
Uh, just looking at some of the issues that came up, I know that the noble lady is going to talk about, um, enforcement and resources, etc. so, um, on enforcement, the, the Marine management organisations enforcement strategy does include a range of tools and that includes advisory letters, formal enforcement action. And what we want to do is apply any enforcement proportionately on risk and evidence. We can place conditions on licences which require licence holders to keep records and make returns, or provide information to the Marine Management Organisation.
But we're also looking at how the MMO can develop intelligent gateways in areas beyond national jurisdiction to be able to assess where there may be non-licensed activity taking place and how to to address that. Um, but regarding non-compliance, any breach of the licence terms and conditions may lead to enforcement action being taken. That can include variation, revocation or suspension of the licence, the issuing of an enforcement notice, civil penalties or indeed criminal proceedings. And they can carry a maximum penalty of an unlimited fine and a term of imprisonment of up to two years um on resources.
The MMO charges for licence applications on a cost recovery basis and applications under BNG will be charged at the highest band three hourly rate. Um, and while the MMO applies a cost recovery approach, not all costs are currently recovered through this mechanism, and the remainder are covered by grant in aid funding. So what we're looking is, is moving towards full cost recovery. Um, in order to, to, to, to get to that place. Um, the noble lady mentioned that there had only been two applications for a licence in an activity in areas beyond national jurisdiction.
They were the Virgin orbit launch of the noble aid is aware of that. Did ask about how we could increase resource if we suddenly have more activity on the basis we're doing on cost recovery basis, that should cover it. But actually, we don't anticipate many activities. Our evidence shows that, um, you know, there's been very few so far. We do have a few case studies. It's difficult to completely assess the volume, but we do not expect much to come forward.
The noble lady mentioned the lack of review. Um, I'm unaware as to whether or not there is a process for that, so I shall I shall pick that up and ask for more information. Um, and I thank the noble Lord, Lord Blencathra, for his comments. I think the specific one that I think I can refer to at the moment is around Chagos. He mentioned the environment around the Chagos Islands. Um, obviously national security is absolutely paramount, but we have secured a deal that will help protect the unique environment of the Chagos Archipelago, the UK and Mauritius have both committed to protecting one of the world's most important marine environments, and the agreement will be supported by an enhanced partnership between the UK and Mauritius, under which the UK will support Mauritius ambitions to establish a marine protected area that protects the globally significant eco ecosystems in Chagos.
We know that this has been welcomed by a conservation NGOs, including the Zoological Society of London and. Both the UK and Mauritius have been working together to attach. You know, really important, you know, great importance on the need to protect marine diversity, including the fight against illegal fishing. Um, so in conclusion, my Lords, this legislation will help ensure the UK can meet its obligations under the Bbng agreement and therefore will be in a position to ratify it while establishing a flexible, proportionate approach to regulating licensable marine activities in areas beyond national jurisdiction.
It's therefore a crucial step in ensuring effective measures that are in place to protect our environment for the future. I beg to move.
17:54
Speaker 14
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Speaker 14
The question is that the Grand Committee has considered this instrument, as many as are of that opinion or, say, content not. Content the contents have it. My Lords, we move on now to the food supplements purity criteria, magnesium L 308 monohydrate. England Regulations 2026. Baroness Hayman and Malik.
17:55
Speaker 12
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Speaker 12
My Lords, I beg to move that the Grand Committee do consider the food supplements purity criteria. Magnesium L three and eight monohydrate England Regulations 2026. My Lords, magnesium L three and eight monohydrate has recently been authorised as a novel food following a public consultation. A safety assessment by the Food Standards Agency, which concluded that it is safe under the proposed conditions of use. The instrument sets the purity criteria that is, the required safety and quality standards for this form of the mineral magnesium to permit its use and sale in food supplements in England.
My Lords, this statutory instrument is a routine and technical measure which ensures that food supplements regulations continue to operate effectively following the authorisation of novel substances for use in food supplements. The regulatory approach taken here is well established where new substances are authorised, it is necessary to update the relevant legislation so that they can be used in practice and to ensure that clear and enforceable quality standards are in place. My Lords will be aware that under our existing legal framework, vitamins and minerals may only be used in food supplements if they are both listed in legislation and meet appropriate safety and quality standards.
Magnesium itself is already a permitted mineral listed in legislation. However, different chemical forms of that mineral must also be specifically listed before they can be used. A related statutory instrument already laid under the negative procedure, adds this substance to the list of permitted forms of magnesium. However, for food supplements containing this substance to be lawfully sold, purity criteria must also be established. And see following the affirmative procedure is required to set the purity criteria for this substance in legislation. That is the sole purpose of the regulations before the Grand Committee today, the criteria specified in this instrument reflects the scientific specification assessed by the Food Standards Agency and ensures that where this substance is used, it is manufactured and marketed to a consistent and safe standard.
Food law is a devolved matter. This instrument applies in England. Only Wales and Scotland have made equivalent amendments to their Food supplements regulations, and Northern Ireland applies. The existing EU equivalent regulations as required by the Windsor framework. It is important to emphasise that this measure is enabling, not mandatory. It does not require any business to use this ingredient or to change their products. The use of this new optional substance initially affects only the applicant who requested this authorisation, and who benefits first from a five year exclusive use period.
During this period, only the applicant may use and sell magnesium l-threonate monohydrate as a form of magnesium, unless another business obtains authorisation based on its own data or with the applicant's permission. In the longer term, other businesses will benefit from the authorisation of this substance supporting choice and product innovation while maintaining robust safety standards. Food supplements legislation is in scope of the UK, EU, sanitary and Phytosanitary or SPS agreement, which will involve alignment with EU legislation in this area. In this case, the substance has already been authorised for use in the EU, so we expect no change in practice for businesses when alignment takes place.
We therefore consider it appropriate to proceed now following the food standards agencies safety assessment to allow the substance to be used in GB as soon as possible to. Include these regulations. Fulfil our requirements to update food supplements regulations where new substances have been authorised for use in food, substances and continue to apply, and continues to uphold high standards of safety and quality for consumers. I beg to move.
My Lords, this statutory instrument is a routine and technical measure which ensures that food supplements regulations continue to operate effectively following the authorisation of novel substances for use in food supplements. The regulatory approach taken here is well established where new substances are authorised, it is necessary to update the relevant legislation so that they can be used in practice and to ensure that clear and enforceable quality standards are in place. My Lords will be aware that under our existing legal framework, vitamins and minerals may only be used in food supplements if they are both listed in legislation and meet appropriate safety and quality standards.
Magnesium itself is already a permitted mineral listed in legislation. However, different chemical forms of that mineral must also be specifically listed before they can be used. A related statutory instrument already laid under the negative procedure, adds this substance to the list of permitted forms of magnesium. However, for food supplements containing this substance to be lawfully sold, purity criteria must also be established. And see following the affirmative procedure is required to set the purity criteria for this substance in legislation. That is the sole purpose of the regulations before the Grand Committee today, the criteria specified in this instrument reflects the scientific specification assessed by the Food Standards Agency and ensures that where this substance is used, it is manufactured and marketed to a consistent and safe standard.
Food law is a devolved matter. This instrument applies in England. Only Wales and Scotland have made equivalent amendments to their Food supplements regulations, and Northern Ireland applies. The existing EU equivalent regulations as required by the Windsor framework. It is important to emphasise that this measure is enabling, not mandatory. It does not require any business to use this ingredient or to change their products. The use of this new optional substance initially affects only the applicant who requested this authorisation, and who benefits first from a five year exclusive use period.
During this period, only the applicant may use and sell magnesium l-threonate monohydrate as a form of magnesium, unless another business obtains authorisation based on its own data or with the applicant's permission. In the longer term, other businesses will benefit from the authorisation of this substance supporting choice and product innovation while maintaining robust safety standards. Food supplements legislation is in scope of the UK, EU, sanitary and Phytosanitary or SPS agreement, which will involve alignment with EU legislation in this area. In this case, the substance has already been authorised for use in the EU, so we expect no change in practice for businesses when alignment takes place.
We therefore consider it appropriate to proceed now following the food standards agencies safety assessment to allow the substance to be used in GB as soon as possible to. Include these regulations. Fulfil our requirements to update food supplements regulations where new substances have been authorised for use in food, substances and continue to apply, and continues to uphold high standards of safety and quality for consumers. I beg to move.
17:59
17:59
Speaker 6
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Speaker 6
A final time in statutory instruments. Um and I thank the Minister for presenting this statutory instrument with her usual clarity and purpose. Um, on these benches the priority is a fair deal for consumers, which means that all food supplements must meet the highest possible standards of quality and safety. The Food Standards Agency has assessed this form of magnesium as safe. And on that basis, we do not oppose its authorisation. But we do have 1 or 2 questions, uh, about how the purity criteria will work in practice.
In simple terms, this s I is about allowing a new form of magnesium supplement onto the market. Um, but only if it meets clear, legally enforceable recipe. The schedule sets out what that recipe looks like. How much of the active ingredient has to be present, how pure it must be, and how little room there is for unwanted substances. That matters. Because without those clear rules, consumers cannot be confident that what it says on the label is what is actually in the bottle.
And yes, I have googled what it does, but I won't say in Parliament what it does. In case I'm recommending something, uh, which I shouldn't be. The timing is also worth putting on the record. The affirmative instrument is deliberately set to start the day after the related negative s I adds this. Form of magnesium to the list of permitted substances, and that's. My Lords. That's exactly the sort of quiet technical coordination that most people never see.
But it really matters if the system is to work more broadly. While the intention to facilitate market entry for novel foods, we do understand it's vital that these changes don't result in a fragmented regulatory landscape. We also need to understand whether decisions such as these are contributing to a pattern of divergence from EU norms, and I feel this is an appropriate moment to thank the noble lady, the Minister, for her recent SPS drop in, which feels highly relevant to even this discussion today. Um, and in that context, I've got three um, queries or.
Questions. First one consultation respondent highlighted divergences between maximum levels permitted in the EU and those proposed by the FSA. Um can the. Letter explain the safety rationale for the UK's chosen parameter, particularly in terms of that point I made earlier about maintaining consumer confidence. Secondly, the government have opted not to include a statutory review clause because the impact is deemed very low. Without a mechanism of that nature.
In simple terms, this s I is about allowing a new form of magnesium supplement onto the market. Um, but only if it meets clear, legally enforceable recipe. The schedule sets out what that recipe looks like. How much of the active ingredient has to be present, how pure it must be, and how little room there is for unwanted substances. That matters. Because without those clear rules, consumers cannot be confident that what it says on the label is what is actually in the bottle.
And yes, I have googled what it does, but I won't say in Parliament what it does. In case I'm recommending something, uh, which I shouldn't be. The timing is also worth putting on the record. The affirmative instrument is deliberately set to start the day after the related negative s I adds this. Form of magnesium to the list of permitted substances, and that's. My Lords. That's exactly the sort of quiet technical coordination that most people never see.
But it really matters if the system is to work more broadly. While the intention to facilitate market entry for novel foods, we do understand it's vital that these changes don't result in a fragmented regulatory landscape. We also need to understand whether decisions such as these are contributing to a pattern of divergence from EU norms, and I feel this is an appropriate moment to thank the noble lady, the Minister, for her recent SPS drop in, which feels highly relevant to even this discussion today. Um, and in that context, I've got three um, queries or.
Questions. First one consultation respondent highlighted divergences between maximum levels permitted in the EU and those proposed by the FSA. Um can the. Letter explain the safety rationale for the UK's chosen parameter, particularly in terms of that point I made earlier about maintaining consumer confidence. Secondly, the government have opted not to include a statutory review clause because the impact is deemed very low. Without a mechanism of that nature.
18:02
Speaker 11
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Speaker 11
How will the department monitor whether these purity thresholds remain aligned?And finally, um, since no. No full impact assessment was produced, what specific guidance or additional resource has been provided to local enforcement bodies to ensure that they can accurately test for the specified purity and containment?Uh, I look forward in advance to any replies, and I completely understand if she wishes to write to me with any reply on any of those issues. Uh, because we are broadly in support.
18:03
Speaker 5
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Speaker 5
Shouldn't use technology, well, my Lord, I thank the noble Baroness, the Minister, for bringing forward this s I. These draft regulations are a purely technical measure and set the purity criteria for magnesium l-threonate to be used in food supplements and for its legal sale and use in compliance with the Food Supplements England Regulations of 20 of 20 of 2003. This is a novel food, and it was examined by the experts on the Advisory Committee on Novel Foods and Processes, who pronounce on its safety and uses the current levels authorised in the novel foods authorisation is 250 micrograms of magnesium per day, which is roughly equivalent to 3250mg of magnesium per day, which is roughly equivalent to the 3000 micrograms of magnesium L threonate per day.
This level was established based on health based guidance values. The Food and Food Standards Agency consulted in this matter. I understand that during the consultation, concerns were raised that the maximum level initially proposed for magnesium l-threonate in food supplements would result in a lower amount of base magnesium compared to the EU's maximum level of 250g. Now, this would have risked disadvantaging British businesses who market their products in EU. Well, the FSA, after consultation with outside organisations, agreed that this agreed. The level we have before us today, which is the same as the EU.
My Lords, on this occasion UK scientists made that decision and it was not foisted on us by the EU. The future, however, looks rather different. Now the assessment of safety is not one set figure, but as a range, allowing the risk revision to a higher but still safe level. I want to commend the work of the independent experts in the EC. NFP, whose assessment allowed this product to get approval. You know, my Lords, they get abuse from ignorant people who complain that they do contract work for the food industry and therefore must be biased.
But I do not want the government to employ any so-called expert if he or she is not good enough to get contract work from an outside company. So these are rather good, excellent, excellent people and I commend them. Now, my Lords here, I would like to raise some broader concerns on food regulation. There has been much noise about the government's intentions for dynamic alignment with the EU. The sanitary and phytosanitary SPS agreement involves 18 key agri food policy areas. The government wants us to believe that this deal will simply ease traffic at our ports when it does, in fact, require adopting thousands of EU laws, including future changes to them over which we will have no say whatsoever.
This includes policies such as approving or restricting food texturizers, enhancers and processing aids, dictating vitamin dosages, mineral concentrations and ingredient reporting, authorising emergency food technologies, synthetic alternatives and lab grown products. Now, many noble lords across this House will have views on insights on each of those areas, but they will be denied any say whatsoever. More broadly, the deal risks sacrificing areas of growth and progress, such as precision breeding and gene editing, or the development of vaccination programmes for cattle against MTC. Mycobacterium tuberculosis complex.
So what assurances can the noble Baroness, the Minister, give that these successes can continue under the SPS agreement?Can the noble Baroness, the Minister, clarify what safeguards, if any, are in place to ensure parliamentary oversight of future changes and to protect parliamentary sovereignty over UK law?These are important considerations. It is not relevant to this measure before us today, but it is something we will face in future if the SPS agreement goes ahead. It is important we can have a say and can make recommendations over regulations such as those before us today.
I look forward to hearing the noble Baroness of the Minister's response, and as I said at the beginning, we welcome these regulations.
This level was established based on health based guidance values. The Food and Food Standards Agency consulted in this matter. I understand that during the consultation, concerns were raised that the maximum level initially proposed for magnesium l-threonate in food supplements would result in a lower amount of base magnesium compared to the EU's maximum level of 250g. Now, this would have risked disadvantaging British businesses who market their products in EU. Well, the FSA, after consultation with outside organisations, agreed that this agreed. The level we have before us today, which is the same as the EU.
My Lords, on this occasion UK scientists made that decision and it was not foisted on us by the EU. The future, however, looks rather different. Now the assessment of safety is not one set figure, but as a range, allowing the risk revision to a higher but still safe level. I want to commend the work of the independent experts in the EC. NFP, whose assessment allowed this product to get approval. You know, my Lords, they get abuse from ignorant people who complain that they do contract work for the food industry and therefore must be biased.
But I do not want the government to employ any so-called expert if he or she is not good enough to get contract work from an outside company. So these are rather good, excellent, excellent people and I commend them. Now, my Lords here, I would like to raise some broader concerns on food regulation. There has been much noise about the government's intentions for dynamic alignment with the EU. The sanitary and phytosanitary SPS agreement involves 18 key agri food policy areas. The government wants us to believe that this deal will simply ease traffic at our ports when it does, in fact, require adopting thousands of EU laws, including future changes to them over which we will have no say whatsoever.
This includes policies such as approving or restricting food texturizers, enhancers and processing aids, dictating vitamin dosages, mineral concentrations and ingredient reporting, authorising emergency food technologies, synthetic alternatives and lab grown products. Now, many noble lords across this House will have views on insights on each of those areas, but they will be denied any say whatsoever. More broadly, the deal risks sacrificing areas of growth and progress, such as precision breeding and gene editing, or the development of vaccination programmes for cattle against MTC. Mycobacterium tuberculosis complex.
So what assurances can the noble Baroness, the Minister, give that these successes can continue under the SPS agreement?Can the noble Baroness, the Minister, clarify what safeguards, if any, are in place to ensure parliamentary oversight of future changes and to protect parliamentary sovereignty over UK law?These are important considerations. It is not relevant to this measure before us today, but it is something we will face in future if the SPS agreement goes ahead. It is important we can have a say and can make recommendations over regulations such as those before us today.
I look forward to hearing the noble Baroness of the Minister's response, and as I said at the beginning, we welcome these regulations.
18:07
Speaker 4
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Speaker 4
Can I thank. The noble lords who. In this. Again, another short and sweet debate. Um. And for your questions, um, the noble lady, Baroness Grender, asked about the EU and divergence. And I think the noble Lords just touched on that as well. So just to clarify, in the EU this form of magnesium has been approved as a novel food and can be used in food supplements in the EU. But there are some minor differences between the EU and the food Standard Agency assessment.
But these do not create a material difference or any safety concerns. In the FSA's view. The differences are due to differences in assessment style rather than in the product itself. In addition, the applicant has confirmed that the product is manufactured, will comply with both the EU and the GB specifications and therefore it doesn't give rise to any concerns regarding the trade between GB and EU on this. Um, and while we're on the EU, the noble Lord talk mainly about dynamic alignment, the legislation that's going to come with that and asking for reassurances in that space.
Clearly, we are still in the middle of negotiations. I can't go into the detail of that. Um, it's not actually relevant directly to this statutory instrument, but the noble Lord will know that I'm always more than happy to sit down and have a cup of tea and discuss these issues in detail with him. Um, as we move forward through the, the EU discussions or all. We know where we are on that. The, the noble lady just to finish also talked about review periods, safety and so on and so forth.
Within that, clearly a lot of these areas are in the FSA's area. Um, and we meet in Defra and also I know in the Department of Health and Social Care regularly with our colleagues in the Food Standards Agency, because it's really important that we uphold standards, that we work very closely together. So, um, I will reference these concerns in our next meeting with the FSA because she does make very important points that when we're bringing in new legislation around novel foods, we need to ensure that for the long term that we're confident in the safety and that consumers are being suitably protected.
So having having said all of that, I would just say remind us, it is just very much a routine technical measure. This this statutory instrument doesn't place any new burdens on businesses, but ensures that use of the substance meets clear, consistent safety and quality standards. I thank noble Lords once again for their contributions and beg to move.
But these do not create a material difference or any safety concerns. In the FSA's view. The differences are due to differences in assessment style rather than in the product itself. In addition, the applicant has confirmed that the product is manufactured, will comply with both the EU and the GB specifications and therefore it doesn't give rise to any concerns regarding the trade between GB and EU on this. Um, and while we're on the EU, the noble Lord talk mainly about dynamic alignment, the legislation that's going to come with that and asking for reassurances in that space.
Clearly, we are still in the middle of negotiations. I can't go into the detail of that. Um, it's not actually relevant directly to this statutory instrument, but the noble Lord will know that I'm always more than happy to sit down and have a cup of tea and discuss these issues in detail with him. Um, as we move forward through the, the EU discussions or all. We know where we are on that. The, the noble lady just to finish also talked about review periods, safety and so on and so forth.
Within that, clearly a lot of these areas are in the FSA's area. Um, and we meet in Defra and also I know in the Department of Health and Social Care regularly with our colleagues in the Food Standards Agency, because it's really important that we uphold standards, that we work very closely together. So, um, I will reference these concerns in our next meeting with the FSA because she does make very important points that when we're bringing in new legislation around novel foods, we need to ensure that for the long term that we're confident in the safety and that consumers are being suitably protected.
So having having said all of that, I would just say remind us, it is just very much a routine technical measure. This this statutory instrument doesn't place any new burdens on businesses, but ensures that use of the substance meets clear, consistent safety and quality standards. I thank noble Lords once again for their contributions and beg to move.
18:10
18:12
Speaker 15
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Speaker 15
My Lords. These draft regulations were laid before the House on the 16th of March 2026, and consist of one of the briefest S I's that I've had the pleasure to introduce in this house. Um, the s I consists of two clauses, one of which is a citation and commencement clause. The other one is a very straightforward amendment to schedule five of the Energy Prices Act 2022, which amends the period to which certain powers in respect of Northern Ireland may be exercised from 26 months to six years.
So a very brief, uh, s I, but I think it would be helpful to noble lords to explain why this is being done and being put forward today. In the autumn budget on 26th of November last year, the Chancellor announced changes we would be making to reduce costs on energy bills in Great Britain. We committed at that time to working with the Northern Ireland Executive. If they chose to develop a comparable offer. These regulations show us delivering on that commitment. In Great Britain and Northern Ireland, the energy Bill changes rely on Energy Prices Act powers subject to different sunset provisions.
On this occasion we are altering the sunset relevant in Northern Ireland to facilitate the executive's delivery in Great Britain. The changes announced were to discontinue the energy Company Obligation Home Insulation Scheme and to transfer 75% of renewables obligation costs in respect of domestic supply to the Exchequer. Now, the energy company obligation has never applied in Northern Ireland and as a result, the executive's comparable proposal to reduce bills relates only to the latter scheme. Northern Ireland Renewables obligation is a scheme to incentivise renewable energy generation in Northern Ireland.
As with the renewables obligation in GB, it closed to new applications in 2017, so. Showing ongoing official level engagement, my colleague the Minister for energy Consumers, received a letter from the Minister for the Economy in Northern Ireland on the 2nd of March, and Minister Archibald asked that we take forward Energy Prices Act regulations to support her department's powers to deliver. We lay these regulations two weeks later as no. Lords may know. The context here is that most energy policy issues are transferred.
Matters for the executive in Northern Ireland to decide on. We in the UK Parliament have a role in these regulations because the primary legislation was passed in 2022 when the Northern Ireland Assembly was not sitting. Nonetheless, I should be clear that the powers we are ensuring the Northern Ireland Department can access relate to a transferred matter are entirely for them to exercise. It will be for the executive to announce the full details of the policy they are taking forward. In precise terms, what these regulations do is to amend the time period in which Energy Prices Act powers are available to the Northern Ireland Department for the economy.
The effect is that that period, as I have set out, will end in February 2030. Noble Lords may recall that we discussed an instrument to extend the period in which an Energy Prices Act powers available to the Secretary of State. Back on 13th of April, and in that case we could only extend the power by six months. And the difference arises from a limit imposed by the Energy Prices Act for the Secretary of State's power only. The key point is that powers.
The Northern Ireland Department will retain access to. Due to these regulations include a spending power and a direction making power. They will be able to use these powers to deliver a renewables obligation to Exchequer policy, analogous to that which has recently been implemented in Great Britain. And once these regulations are in place, I know colleagues in the executive will be working to put in place that analogous policy as quickly as they can. It is rightly for them to do this in this transfer policy area and for the Northern Ireland Assembly to hold them to account before.
I conclude it is worth saying that my ministerial colleagues in my department and, uh, and and my department itself continue to engage closely with counterparts in Northern Ireland to ensure energy policy takes account of relevant differences. That joint working has led us to these regulations today and to reflecting Northern Ireland's unique reliance on heating oil in the £53 million of support announced more recently, we will continue to engage openly as we monitor the situation in the Middle East, considering whether any further responsive and responsible action is required. My Lords, these regulations alter the period in which the Northern Ireland Department for the economy can exercise powers based on a request from that Department, ensuring that they too can act to reduce energy bills.
And I beg to move.
So a very brief, uh, s I, but I think it would be helpful to noble lords to explain why this is being done and being put forward today. In the autumn budget on 26th of November last year, the Chancellor announced changes we would be making to reduce costs on energy bills in Great Britain. We committed at that time to working with the Northern Ireland Executive. If they chose to develop a comparable offer. These regulations show us delivering on that commitment. In Great Britain and Northern Ireland, the energy Bill changes rely on Energy Prices Act powers subject to different sunset provisions.
On this occasion we are altering the sunset relevant in Northern Ireland to facilitate the executive's delivery in Great Britain. The changes announced were to discontinue the energy Company Obligation Home Insulation Scheme and to transfer 75% of renewables obligation costs in respect of domestic supply to the Exchequer. Now, the energy company obligation has never applied in Northern Ireland and as a result, the executive's comparable proposal to reduce bills relates only to the latter scheme. Northern Ireland Renewables obligation is a scheme to incentivise renewable energy generation in Northern Ireland.
As with the renewables obligation in GB, it closed to new applications in 2017, so. Showing ongoing official level engagement, my colleague the Minister for energy Consumers, received a letter from the Minister for the Economy in Northern Ireland on the 2nd of March, and Minister Archibald asked that we take forward Energy Prices Act regulations to support her department's powers to deliver. We lay these regulations two weeks later as no. Lords may know. The context here is that most energy policy issues are transferred.
Matters for the executive in Northern Ireland to decide on. We in the UK Parliament have a role in these regulations because the primary legislation was passed in 2022 when the Northern Ireland Assembly was not sitting. Nonetheless, I should be clear that the powers we are ensuring the Northern Ireland Department can access relate to a transferred matter are entirely for them to exercise. It will be for the executive to announce the full details of the policy they are taking forward. In precise terms, what these regulations do is to amend the time period in which Energy Prices Act powers are available to the Northern Ireland Department for the economy.
The effect is that that period, as I have set out, will end in February 2030. Noble Lords may recall that we discussed an instrument to extend the period in which an Energy Prices Act powers available to the Secretary of State. Back on 13th of April, and in that case we could only extend the power by six months. And the difference arises from a limit imposed by the Energy Prices Act for the Secretary of State's power only. The key point is that powers.
The Northern Ireland Department will retain access to. Due to these regulations include a spending power and a direction making power. They will be able to use these powers to deliver a renewables obligation to Exchequer policy, analogous to that which has recently been implemented in Great Britain. And once these regulations are in place, I know colleagues in the executive will be working to put in place that analogous policy as quickly as they can. It is rightly for them to do this in this transfer policy area and for the Northern Ireland Assembly to hold them to account before.
I conclude it is worth saying that my ministerial colleagues in my department and, uh, and and my department itself continue to engage closely with counterparts in Northern Ireland to ensure energy policy takes account of relevant differences. That joint working has led us to these regulations today and to reflecting Northern Ireland's unique reliance on heating oil in the £53 million of support announced more recently, we will continue to engage openly as we monitor the situation in the Middle East, considering whether any further responsive and responsible action is required. My Lords, these regulations alter the period in which the Northern Ireland Department for the economy can exercise powers based on a request from that Department, ensuring that they too can act to reduce energy bills.
And I beg to move.
18:17
18:18
Speaker 16
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Speaker 16
Lords, I rise to thank the Minister for his statement, which is particularly, by the way, his concluding words about acknowledging Northern Ireland's unique dependence on heating oil and how his Department will be maintaining a vigilant eye. There are issues of timing around this. This s I, which I'm sure will be debated this evening. I there were issues of timing around the last s I that the minister introduced in March the 26th as well. Both cases I was mindful of the fact I had.
I did have substantial doubts about the last s I more than I have about this one. In both cases, I was mindful of the fact that the minister had actually. There had been a serious dialogue with the Northern Ireland Assembly and the executive. And while I was very uneasy about the. The last s I. The minister introduced in the chamber on Greenhouse gas on March 26th. I did not vote against it, because the fundamental job of the government.
Here it is to remain in to to pay close attention, to have a proper dialogue with the executive in Northern Ireland. That having been said, there, the. If I could say in favour of this, as I. Against the last one, the danger with the last. Such instrument on. On greenhouse gases is that the Winthrop framework, power of 51 commits the United Kingdom government to ensuring that Northern Ireland goods appear in the UK market without any advantage to either Scotland or Wales on exactly the same equality of treatment.
That seemed to be a major problem. Uh, the implicit conflict, because the last statutory instrument did favor Scotland. Um, but the. This one I think. By and large is driven by a proper and correct concern with the future of energy supply in Northern Ireland. And I would like to thank the Minister for his introduction tonight.
I did have substantial doubts about the last s I more than I have about this one. In both cases, I was mindful of the fact that the minister had actually. There had been a serious dialogue with the Northern Ireland Assembly and the executive. And while I was very uneasy about the. The last s I. The minister introduced in the chamber on Greenhouse gas on March 26th. I did not vote against it, because the fundamental job of the government.
Here it is to remain in to to pay close attention, to have a proper dialogue with the executive in Northern Ireland. That having been said, there, the. If I could say in favour of this, as I. Against the last one, the danger with the last. Such instrument on. On greenhouse gases is that the Winthrop framework, power of 51 commits the United Kingdom government to ensuring that Northern Ireland goods appear in the UK market without any advantage to either Scotland or Wales on exactly the same equality of treatment.
That seemed to be a major problem. Uh, the implicit conflict, because the last statutory instrument did favor Scotland. Um, but the. This one I think. By and large is driven by a proper and correct concern with the future of energy supply in Northern Ireland. And I would like to thank the Minister for his introduction tonight.
18:20
18:20
Speaker 17
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Speaker 17
Lords, I welcome and we support the Energy Prices Act 2002. Amendment. Northern Ireland Regulations 2026, particularly the continued effort to ensure that consumers in Northern Ireland receive appropriate protection from the continued volatility in energy costs following the war in the Middle East. And can I take a moment just to thank the Minister for introducing it?Uh, we are supportive of the government's removal of the energy obligations and eco policies for consumer and from consumer energy bills, as brought in under the in the UK, under the autumn budget, uh, consumers in Northern Ireland should also be able to benefit as consumers in Great Britain have already.
From these. These powers. Um, so we welcome this and we welcome what it does. However, I will just take the opportunity in responding, um, just if I could, to ask the minister just a couple of questions first, um I recognise that this is ultimately for the Northern Ireland dfee to decide um how to use these powers. And we welcome the work that is being done to provide them with support in designing that system. I mean, I think that that inter-government, cooperation and work together is welcome.
Um, I also note that the exact design of the comparable offer is, is yet to be finalised as drafted in the explanatory memoranda. Um, so could I just ask the noble Lord, the minister and sorry, the noble Lord may not be able to answer the question, but I recognise that may be the case. But does he have an idea of when it is expected that the work on this will be completed from the DfE in Northern Ireland?And I simply ask that question because obviously, as has been mentioned already, it is extremely important that, um, that these measures are put in place so that consumers in Northern Ireland can enjoy the same benefits as their counterparts in the rest of the UK.
Second, um, it is well understood and has been mentioned by the minister himself that some 61% of households in Northern Ireland are indeed dependent on oil central heating as their primary source, and those figures are from 2024 2025. I recognise some of the work the government's already done since conflict in the Middle East on trying to prevent price gouging. The minister himself has mentioned the £53 million support package that has been provided, and while we welcome that package, it's that package in and of itself. I'm sure the minister will recognise there's there's still more that can be done there.
So knowing. That knowing that Northern Ireland has been particularly dependent on this particular fuel oil, knowing that those prices have been particularly hard hit as a result of the conflict, could I just ask, is it known and is it intended that?From the DfE in Northern Ireland, whether whether some of these measures might help deal with those particular problems?Um more generally, I'd like to ask the noble Lord, the Minister, what further consideration is being given both from the DfE and Northern Ireland, and perhaps also including GB energy as a community energy scheme to actually replacing those those types of outdated heating systems, particularly moving onto more cost effective and efficient heat pump technology, and whether whether perhaps that is a project for GB energy, a community energy project, whether any consideration has been given to that in government.
And third, could the government outline how long these amended measures are intended?Is it is it expected they will remain in force until 2030, as is possible under the S I?And what criteria will determine if they're withdrawn or if they're extended?But, my Lords, we support this instrument and we have no objection to it.
From these. These powers. Um, so we welcome this and we welcome what it does. However, I will just take the opportunity in responding, um, just if I could, to ask the minister just a couple of questions first, um I recognise that this is ultimately for the Northern Ireland dfee to decide um how to use these powers. And we welcome the work that is being done to provide them with support in designing that system. I mean, I think that that inter-government, cooperation and work together is welcome.
Um, I also note that the exact design of the comparable offer is, is yet to be finalised as drafted in the explanatory memoranda. Um, so could I just ask the noble Lord, the minister and sorry, the noble Lord may not be able to answer the question, but I recognise that may be the case. But does he have an idea of when it is expected that the work on this will be completed from the DfE in Northern Ireland?And I simply ask that question because obviously, as has been mentioned already, it is extremely important that, um, that these measures are put in place so that consumers in Northern Ireland can enjoy the same benefits as their counterparts in the rest of the UK.
Second, um, it is well understood and has been mentioned by the minister himself that some 61% of households in Northern Ireland are indeed dependent on oil central heating as their primary source, and those figures are from 2024 2025. I recognise some of the work the government's already done since conflict in the Middle East on trying to prevent price gouging. The minister himself has mentioned the £53 million support package that has been provided, and while we welcome that package, it's that package in and of itself. I'm sure the minister will recognise there's there's still more that can be done there.
So knowing. That knowing that Northern Ireland has been particularly dependent on this particular fuel oil, knowing that those prices have been particularly hard hit as a result of the conflict, could I just ask, is it known and is it intended that?From the DfE in Northern Ireland, whether whether some of these measures might help deal with those particular problems?Um more generally, I'd like to ask the noble Lord, the Minister, what further consideration is being given both from the DfE and Northern Ireland, and perhaps also including GB energy as a community energy scheme to actually replacing those those types of outdated heating systems, particularly moving onto more cost effective and efficient heat pump technology, and whether whether perhaps that is a project for GB energy, a community energy project, whether any consideration has been given to that in government.
And third, could the government outline how long these amended measures are intended?Is it is it expected they will remain in force until 2030, as is possible under the S I?And what criteria will determine if they're withdrawn or if they're extended?But, my Lords, we support this instrument and we have no objection to it.
18:24
Speaker 18
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Speaker 18
Um, my Lords, um this instrument underpins the measures which, as has been pointed out, we've already debated um it creates no new powers. And, and the opposite, Her Majesty's opposition is supportive. Um more. Broadly, as the noble Lord, the minister knows, um we do not believe the government um, can lower the structural cost of energy for families and businesses in Britain simply by moving policy costs around from energy bills and onto tax bills. But I accept that we have debated, um, the content of the row and the policy context in which this um C has been brought forward at some length already.
Um this is very specific to Northern Ireland. It's something of a surprise because it extends by six years from a date that's already passed on the 3rd of April. And so we've been in a, in a unusual position whereby this doesn't apply, but is going to apply retrospectively. And I regret that. I think it should have been brought back at a much earlier stage. But the questions that have been put forward by the noble Lord, Lord Russell, just now are very relevant.
Um the s. C specifically states that the government is working with the Northern Ireland Executive as they consider developing a comparable offer. So at least knows that that's what's intended to the row to Exchequer policy. But the exact design of the comparable offer has not yet been finalised. Well, that makes it clear that we're pretty close to it. We're just short of the exact design, and I think it is useful for the committee to hear from the minister a little bit more detail about the status of the discussions and the status of the project that is being proposed.
So we're not simply writing a blank check. Um, I accept that. Elsewhere in the C, the there is recognition of the importance that this is, um a matter for the Northern Ireland Assembly. Um clearly, but it is um I think incumbent on, on the minister and the government given that they've used the word exact sign, um to provide details to members of the House, not least so members from Northern Ireland can study them following this debate today. Um, I appreciate that.
It goes on to say that this is an enabling measure, um, doesn't provide any financial support or determine the design, timing or announcement of any scheme in Northern Ireland. Um, but we are already well on the road to a final um proposal and. And given that the um. Lord Bew and. My noble friend Lord Bute and um the noble Lord, Lord Russell have focused on the timing of how long it's going to take. And given that the. We now know that the exact design of the comparable comparable offer has yet to be finalised, and we're clearly making very good progress.
So are we talking about six weeks?Six months?We're talking about a year. Or why are we talking about six years?Um, rather than 3 or 16. Um in the C. So I would be very grateful if um the noble Lord, the minister could give us clarity on the status of the negotiations with um colleagues in the Northern Ireland Executive, what the Northern Ireland Executive are thinking about in this context. After all, they've known about this since the budget and provide as much detail as possible so that um members of the House interested in matters relating to Northern Ireland are well briefed.
And I say that um with. With renewed emphasis today we have had regrettably yesterday evening a debate in the in the chamber where there was real concern that um members from Northern Ireland members with a particular interest in Northern Ireland, if they happen to be from Northern Ireland as well. Um were worried that Northern Ireland was a sort of afterthought and that policy hadn't been properly designed in recognition that Northern Ireland was absolutely an inherent and important part of the United Kingdom. And there is a danger with this measure of a very similar interpretation that quickly coming to the House with an SI that recognises that the timing has now lapsed and we need a new extension.
Doesn't look good unless the Minister can demonstrate clearly that there has been detailed discussion over exactly what this policy is going to look like, and and information given to the Committee and to the House about the design of the comparable offer, um, which I hope the Minister will now be able to give. So I'm very grateful to him for introducing this s I and I hope that he'll be able to provide much further information on this, either today in committee or indeed in writing.
Um this is very specific to Northern Ireland. It's something of a surprise because it extends by six years from a date that's already passed on the 3rd of April. And so we've been in a, in a unusual position whereby this doesn't apply, but is going to apply retrospectively. And I regret that. I think it should have been brought back at a much earlier stage. But the questions that have been put forward by the noble Lord, Lord Russell, just now are very relevant.
Um the s. C specifically states that the government is working with the Northern Ireland Executive as they consider developing a comparable offer. So at least knows that that's what's intended to the row to Exchequer policy. But the exact design of the comparable offer has not yet been finalised. Well, that makes it clear that we're pretty close to it. We're just short of the exact design, and I think it is useful for the committee to hear from the minister a little bit more detail about the status of the discussions and the status of the project that is being proposed.
So we're not simply writing a blank check. Um, I accept that. Elsewhere in the C, the there is recognition of the importance that this is, um a matter for the Northern Ireland Assembly. Um clearly, but it is um I think incumbent on, on the minister and the government given that they've used the word exact sign, um to provide details to members of the House, not least so members from Northern Ireland can study them following this debate today. Um, I appreciate that.
It goes on to say that this is an enabling measure, um, doesn't provide any financial support or determine the design, timing or announcement of any scheme in Northern Ireland. Um, but we are already well on the road to a final um proposal and. And given that the um. Lord Bew and. My noble friend Lord Bute and um the noble Lord, Lord Russell have focused on the timing of how long it's going to take. And given that the. We now know that the exact design of the comparable comparable offer has yet to be finalised, and we're clearly making very good progress.
So are we talking about six weeks?Six months?We're talking about a year. Or why are we talking about six years?Um, rather than 3 or 16. Um in the C. So I would be very grateful if um the noble Lord, the minister could give us clarity on the status of the negotiations with um colleagues in the Northern Ireland Executive, what the Northern Ireland Executive are thinking about in this context. After all, they've known about this since the budget and provide as much detail as possible so that um members of the House interested in matters relating to Northern Ireland are well briefed.
And I say that um with. With renewed emphasis today we have had regrettably yesterday evening a debate in the in the chamber where there was real concern that um members from Northern Ireland members with a particular interest in Northern Ireland, if they happen to be from Northern Ireland as well. Um were worried that Northern Ireland was a sort of afterthought and that policy hadn't been properly designed in recognition that Northern Ireland was absolutely an inherent and important part of the United Kingdom. And there is a danger with this measure of a very similar interpretation that quickly coming to the House with an SI that recognises that the timing has now lapsed and we need a new extension.
Doesn't look good unless the Minister can demonstrate clearly that there has been detailed discussion over exactly what this policy is going to look like, and and information given to the Committee and to the House about the design of the comparable offer, um, which I hope the Minister will now be able to give. So I'm very grateful to him for introducing this s I and I hope that he'll be able to provide much further information on this, either today in committee or indeed in writing.
18:29
Speaker 15
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Speaker 15
Well, I thank noble Lords for their very useful contributions to this, uh, albeit short debate this afternoon, and I hope I will be able to provide some of the detail that noble Lords were looking for in terms of this particular measure. Uh, and particularly, the question of the, uh, shall we say, the enhanced sunset clause that that noble lords are now considering. Um, but before I do that, I haven't had an opportunity, uh, to. Um. Welcome, uh, the noble Lord, Lord Moynihan, back to his slightly amended place.
Um, in this house. And to say how I, how delighted I was to see his return. Um and, um, look forward to many occasions that are now possible for our convivial and constructive debates across the chamber on the future of energy policy. The. Background, I think to the whole of this, both as far as the UK and the. Deed to Northern Ireland is the. The speed at which the UK government wished to implement these changes.
Uh. As far as the reduction, particularly of the um. The uh. Bills, both the eco uh and. For renewable obligation being transferred. Um, either. Removed or transferred to the Treasury. 75% to the Treasury of renewable obligations. And frankly, to look at a piece of legislation that was actually passed under the last conservative government, um, to provide a vehicle for that to happen quickly, rather than that to have to go through a whole process of new legislation all over again.
And the 22 Energy Act, uh, is the. The vehicle. And as, uh, noble Lords will spot, however, that, uh. That piece of legislation was quite rightly at the time heavily sunsetted. Therefore, in order to make it appropriate both for, uh, great British purposes and now for Northern Ireland purposes, it's necessary to amend those sunset clauses. I appreciate what the noble Lord, Lord Moynihan, says about the fact that that sunset had already lapsed. Um, at the point at which this was applied to Northern Ireland.
Um, that was purely a question of getting the, uh, arrangements for Northern Ireland sorted out, which could have been done, uh, a little earlier, but um, wasn't really possible in terms of the, uh, the, the general use of this bill for the purposes of the great British, uh, British arrangements. And then subsequently for, uh, Northern Ireland and of course, the changes here were as a result of a request from the Northern Ireland Executive to extend the provisions to Northern Ireland. And this was the best way to do it quickly and efficiently.
And in that context, I am very much, uh, welcome the support of the noble Lord, Lord Bew. Uh, in, uh, a clear understanding that that is what is trying to be done. And his welcome for that under these purposes. Now, uh, noble Lord, Lord Russell, uh, has, uh. Uh, asked me a number of questions, uh, which. I think to some extent are, um, answered. By looking at what the Northern Ireland Executive is now doing subsequent or will be doing subsequent to this.
This, uh, s I hopefully proceeding through this house and, uh, that is, um, firstly. Uh, a question of, uh. At how a system. Uh, which is analogous to the great British system can be developed in Northern Ireland. It's not our place to tell the Northern Ireland Executive what the scheme is going to be. Exactly. And of course, the circumstances um of renewables obligations and what have you in Northern Ireland are different than they are in the uh, in the, in, in Great Britain.
And therefore the savings and the arrangements for this will differ. Um, but the important point is that the UK government has made it clear that um the. UK government would fund a comparable policy in Northern Ireland if taken forward by the executive doesn't have to be exactly the same. Um but it has to obviously be funded on the basis that it is a comparable kind of policy. And so the Northern Ireland Executive then had several steps to think through. And we have endeavoured to be supportive of that.
Uh, we laid the regulations a fortnight, as I said, after receiving a formal request from Minister Archibald, and work has been gone, has been been undertaken at speed. Uh, after that, uh, by, I understand, by the Northern Ireland Executive and for example, a business case has been submitted to the Treasury very recently, which the Treasury intend to consider very promptly. So after the Northern Ireland Executive has worked through those various steps, I understand that they intend to commence delivery as early as this summer, and that's obviously subject to approvals and legislation being in place, but it looks well set to to do that.
And that, I think, uh, is a clear indication, uh, particularly to noble Lord, Lord Moynihan, who was concerned about whether this would come in early or late. The considerations are certainly for very early delivery. Uh, now, as far as, uh, the question of the, uh. The. Funding. Uh, for, uh, heating oil in Northern Ireland. Let's be clear that the proportion of funding that was supplied to Northern Ireland out of the 53 million was not based on a per capita understanding of how that applied to the whole of the United Kingdom.
It was based very substantially on the understanding that the need for that underpinning was far greater in Northern Ireland because of the particular situation that Northern Ireland was concerning the use of heating oil in homes, uh, as a very high percentage of the total homes in Northern Ireland, rather than the much smaller percentage in Scotland and in England and Wales. So. That, uh. That particular scheme is, is again, one that the Northern Ireland Executive has the. Uh, leeway to decide how to distribute and what to do.
But on that basis that there is a very high usage in Northern Ireland. And I understand the Northern Ireland Executive has added a considerable sum of money to that 17 million, uh, to fully deal with the situation in Northern Ireland, as we find it. The final question, I think from particularly from a noble. Lord, Lord Moynihan was is it intended that this uh. Measure, particularly the measure about aro. Levies to Treasury. Uh, which I understand will actually be about 30 to £40 reduction in bills.
And I would emphasise that's not that's reduction in the bill that would otherwise be there, not necessarily bills completely going down. Um, is is a. A. Is a change that is intended to be permanent. And however, the the. Legislation doesn't permit the sunset clause to become permanent. It permits a sunset clause to be extended to a further sunset clause. So at least in theory, it will be necessary in, say, 2030 to introduce a measure which actually does make this permanent, but I think we've got a.
We've got a few years to sort that out before this sunset clause. Finally takes way. So, uh, I believe, uh, as far as this particular measure is concerned, both the UK government and the Northern Ireland Executive working in tandem, have done their very best to get this right. In the very shortest amount of time. And I hope noble lords will be, uh, very supportive of this measure because it does allow that work to come to fruition. Indeed, at a very early amount of time, to the benefit of all concerned.
So I'd like to move.
Um, in this house. And to say how I, how delighted I was to see his return. Um and, um, look forward to many occasions that are now possible for our convivial and constructive debates across the chamber on the future of energy policy. The. Background, I think to the whole of this, both as far as the UK and the. Deed to Northern Ireland is the. The speed at which the UK government wished to implement these changes.
Uh. As far as the reduction, particularly of the um. The uh. Bills, both the eco uh and. For renewable obligation being transferred. Um, either. Removed or transferred to the Treasury. 75% to the Treasury of renewable obligations. And frankly, to look at a piece of legislation that was actually passed under the last conservative government, um, to provide a vehicle for that to happen quickly, rather than that to have to go through a whole process of new legislation all over again.
And the 22 Energy Act, uh, is the. The vehicle. And as, uh, noble Lords will spot, however, that, uh. That piece of legislation was quite rightly at the time heavily sunsetted. Therefore, in order to make it appropriate both for, uh, great British purposes and now for Northern Ireland purposes, it's necessary to amend those sunset clauses. I appreciate what the noble Lord, Lord Moynihan, says about the fact that that sunset had already lapsed. Um, at the point at which this was applied to Northern Ireland.
Um, that was purely a question of getting the, uh, arrangements for Northern Ireland sorted out, which could have been done, uh, a little earlier, but um, wasn't really possible in terms of the, uh, the, the general use of this bill for the purposes of the great British, uh, British arrangements. And then subsequently for, uh, Northern Ireland and of course, the changes here were as a result of a request from the Northern Ireland Executive to extend the provisions to Northern Ireland. And this was the best way to do it quickly and efficiently.
And in that context, I am very much, uh, welcome the support of the noble Lord, Lord Bew. Uh, in, uh, a clear understanding that that is what is trying to be done. And his welcome for that under these purposes. Now, uh, noble Lord, Lord Russell, uh, has, uh. Uh, asked me a number of questions, uh, which. I think to some extent are, um, answered. By looking at what the Northern Ireland Executive is now doing subsequent or will be doing subsequent to this.
This, uh, s I hopefully proceeding through this house and, uh, that is, um, firstly. Uh, a question of, uh. At how a system. Uh, which is analogous to the great British system can be developed in Northern Ireland. It's not our place to tell the Northern Ireland Executive what the scheme is going to be. Exactly. And of course, the circumstances um of renewables obligations and what have you in Northern Ireland are different than they are in the uh, in the, in, in Great Britain.
And therefore the savings and the arrangements for this will differ. Um, but the important point is that the UK government has made it clear that um the. UK government would fund a comparable policy in Northern Ireland if taken forward by the executive doesn't have to be exactly the same. Um but it has to obviously be funded on the basis that it is a comparable kind of policy. And so the Northern Ireland Executive then had several steps to think through. And we have endeavoured to be supportive of that.
Uh, we laid the regulations a fortnight, as I said, after receiving a formal request from Minister Archibald, and work has been gone, has been been undertaken at speed. Uh, after that, uh, by, I understand, by the Northern Ireland Executive and for example, a business case has been submitted to the Treasury very recently, which the Treasury intend to consider very promptly. So after the Northern Ireland Executive has worked through those various steps, I understand that they intend to commence delivery as early as this summer, and that's obviously subject to approvals and legislation being in place, but it looks well set to to do that.
And that, I think, uh, is a clear indication, uh, particularly to noble Lord, Lord Moynihan, who was concerned about whether this would come in early or late. The considerations are certainly for very early delivery. Uh, now, as far as, uh, the question of the, uh. The. Funding. Uh, for, uh, heating oil in Northern Ireland. Let's be clear that the proportion of funding that was supplied to Northern Ireland out of the 53 million was not based on a per capita understanding of how that applied to the whole of the United Kingdom.
It was based very substantially on the understanding that the need for that underpinning was far greater in Northern Ireland because of the particular situation that Northern Ireland was concerning the use of heating oil in homes, uh, as a very high percentage of the total homes in Northern Ireland, rather than the much smaller percentage in Scotland and in England and Wales. So. That, uh. That particular scheme is, is again, one that the Northern Ireland Executive has the. Uh, leeway to decide how to distribute and what to do.
But on that basis that there is a very high usage in Northern Ireland. And I understand the Northern Ireland Executive has added a considerable sum of money to that 17 million, uh, to fully deal with the situation in Northern Ireland, as we find it. The final question, I think from particularly from a noble. Lord, Lord Moynihan was is it intended that this uh. Measure, particularly the measure about aro. Levies to Treasury. Uh, which I understand will actually be about 30 to £40 reduction in bills.
And I would emphasise that's not that's reduction in the bill that would otherwise be there, not necessarily bills completely going down. Um, is is a. A. Is a change that is intended to be permanent. And however, the the. Legislation doesn't permit the sunset clause to become permanent. It permits a sunset clause to be extended to a further sunset clause. So at least in theory, it will be necessary in, say, 2030 to introduce a measure which actually does make this permanent, but I think we've got a.
We've got a few years to sort that out before this sunset clause. Finally takes way. So, uh, I believe, uh, as far as this particular measure is concerned, both the UK government and the Northern Ireland Executive working in tandem, have done their very best to get this right. In the very shortest amount of time. And I hope noble lords will be, uh, very supportive of this measure because it does allow that work to come to fruition. Indeed, at a very early amount of time, to the benefit of all concerned.
So I'd like to move.
18:39
18:40
18:40
18:40
Speaker 15
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Speaker 15
Well, uh, yes it is. Uh, unfortunate that you've got. Me again, uh, for this particular s I, but I hope I can be brief and to the point on this one, because I believe this particular s I, uh, actually produces a number of very fairly technical. But pretty minor changes to the way, uh, contracts for difference, uh, are. Uh, bid for and allocated. Uh, I hope will see, uh, gain the approval of noble lords this afternoon. So I beg to move that the draft contracts for difference allocation Amendments Regulations 2026, which were laid before the House on the 20th of April, 2026, be approved.
And the statutory instrument, as I've alluded to, makes several minor and technical amendments to improve the operational efficiency of the contracts for difference scheme during the assessment of applications subject to Parliament, the government intends to introduce these targeted and practical measures in time for allocation. Round eight, which opens for applications on the 20th of July. So there is some haste in these procedures this afternoon. Acts were different. Scheme as the government's flagship policy for supporting new low carbon electricity generation in Great Britain and CFDs are awarded through annual competitive auctions with the lowest priced bids being successful now.
In March, the Energy Secretary outlined a package of measures to go further and faster on clean power in response to events in the Middle East, and that included bringing forward the opening of R eight to July to provide certainty for clean energy investors. The most recent allocation round allocation round seven alone, secured 14.7GW of clean homegrown generating capacity across 201 new projects. And IR7 built on the success of IR6 in September 2024, which secured over seven gigawatts of renewable capacity across Great Britain. And I think it is worth just looking at the upward curve of the amount of capacity procured in those in those two rounds.
We won't go back to allocation round five, but, um, certainly in those two rounds, a very, very successful um allocation outcome. And indeed, uh, one can say that R seven was the most successful renewables auction in European history. There are seven reforms. We introduced to boost competition and investor confidence, secured renewable capacity at strike prices 40% lower than the cost of building and operating a new gas power plant. And these achievements show how central the CFD scheme is to our mission to deliver clean power by 2030 and strengthens Britain's energy security.
Now the government keeps the CFD scheme under review to ensure it remains fit for purpose, and the regulations will make the following three amendments to improve the future operation of the scheme. First, they will enable the National energy System operator Nyiso, which is responsible for the uh allocation. Round process to correct certain types of errors it makes during the assessment of applications by issuing new or amended qualification decisions where evidence supports this Nyiso in its role as the CFD delivery body assesses applications against the eligibility criteria and determines whether applicants qualify to participate in the competitive allocation process.
As the CFD scheme has grown in popularity, the volume of applications has increased significantly, with several hundred submitted in recent allocation rounds. And although eligibility checks are very robust, larger number of applications increases the risk of errors in assessment decisions, and this amendment will ensure greater consistency and fairness in how the CFD eligibility requirements are applied. And second, the regulations will enable Nyiso to consider additional information or documentary evidence submitted by applicants when examining appeals from non qualification decisions. That is where an applicant has been.
Thrown out of the process because it is considered they didn't qualify this. Will help avoid projects being disqualified for minor or trivial omissions in their applications. It should streamline the process and ultimately increase the number of participations. But sorry, participants in the auction, driving greater competition and better value for money. Outcomes for bill payers. And third, the regulations clarify how Nyiso is to treat applications when eligibility has not yet been decided by the point at which the regulations require nyiso to proceed with the auction.
And this is a very rare um or will be. A very rare occurrence, but something that nevertheless we need to consider. And in the light of operational experience from R7, this amendment will remove some ambiguity in the current regulations. So finally, the regulations provide for procedures or information relating to the implementation of several of the measures that I have just described to be set out in the contract allocation framework. This is a statutory document which contains the eligibility criteria and rules governing how Nyiso must allocate CFDs in an allocation round.
Government published a draft of the Contract allocation framework, setting out the proposed requirements of R8 on the 1st of June, inviting stakeholder views, and the final version will be published in early July before the round opens to applications. And I would say certainly as far as the process of, um, those who are um, perhaps. Coming into the allocation round or having their eligibility queried and then coming into the rounds at the end of the process. Um, if noble Lords would like a complete explanation of how that works, that can be given, but that will take us several hours, uh, further discussion.
So I hope noble lords will take it from me, um, that this does actually work, uh, in terms of actually making sure that we don't have unforeseen outcomes when the allocation round process actually takes place. Now, my Lords, these amendments received strong stakeholder support in the recent public consultation. There was broad stakeholder recognition that the changes will improve the experience of applicants during the assessment process, support more effective competition and help to secure better value for money for consumers. And this approach reflects the department's continued close engagement with industry in the development of the CFD scheme, and by building on the foundations laid in R7.
These regulations, I believe, will help strengthen procedures and simplify the operation of the scheme and introduce provisions that drive progress towards a 2030 clean power target while securing better value for money for bill payers. And I therefore commend these regulations to the Committee and beg to move.
And the statutory instrument, as I've alluded to, makes several minor and technical amendments to improve the operational efficiency of the contracts for difference scheme during the assessment of applications subject to Parliament, the government intends to introduce these targeted and practical measures in time for allocation. Round eight, which opens for applications on the 20th of July. So there is some haste in these procedures this afternoon. Acts were different. Scheme as the government's flagship policy for supporting new low carbon electricity generation in Great Britain and CFDs are awarded through annual competitive auctions with the lowest priced bids being successful now.
In March, the Energy Secretary outlined a package of measures to go further and faster on clean power in response to events in the Middle East, and that included bringing forward the opening of R eight to July to provide certainty for clean energy investors. The most recent allocation round allocation round seven alone, secured 14.7GW of clean homegrown generating capacity across 201 new projects. And IR7 built on the success of IR6 in September 2024, which secured over seven gigawatts of renewable capacity across Great Britain. And I think it is worth just looking at the upward curve of the amount of capacity procured in those in those two rounds.
We won't go back to allocation round five, but, um, certainly in those two rounds, a very, very successful um allocation outcome. And indeed, uh, one can say that R seven was the most successful renewables auction in European history. There are seven reforms. We introduced to boost competition and investor confidence, secured renewable capacity at strike prices 40% lower than the cost of building and operating a new gas power plant. And these achievements show how central the CFD scheme is to our mission to deliver clean power by 2030 and strengthens Britain's energy security.
Now the government keeps the CFD scheme under review to ensure it remains fit for purpose, and the regulations will make the following three amendments to improve the future operation of the scheme. First, they will enable the National energy System operator Nyiso, which is responsible for the uh allocation. Round process to correct certain types of errors it makes during the assessment of applications by issuing new or amended qualification decisions where evidence supports this Nyiso in its role as the CFD delivery body assesses applications against the eligibility criteria and determines whether applicants qualify to participate in the competitive allocation process.
As the CFD scheme has grown in popularity, the volume of applications has increased significantly, with several hundred submitted in recent allocation rounds. And although eligibility checks are very robust, larger number of applications increases the risk of errors in assessment decisions, and this amendment will ensure greater consistency and fairness in how the CFD eligibility requirements are applied. And second, the regulations will enable Nyiso to consider additional information or documentary evidence submitted by applicants when examining appeals from non qualification decisions. That is where an applicant has been.
Thrown out of the process because it is considered they didn't qualify this. Will help avoid projects being disqualified for minor or trivial omissions in their applications. It should streamline the process and ultimately increase the number of participations. But sorry, participants in the auction, driving greater competition and better value for money. Outcomes for bill payers. And third, the regulations clarify how Nyiso is to treat applications when eligibility has not yet been decided by the point at which the regulations require nyiso to proceed with the auction.
And this is a very rare um or will be. A very rare occurrence, but something that nevertheless we need to consider. And in the light of operational experience from R7, this amendment will remove some ambiguity in the current regulations. So finally, the regulations provide for procedures or information relating to the implementation of several of the measures that I have just described to be set out in the contract allocation framework. This is a statutory document which contains the eligibility criteria and rules governing how Nyiso must allocate CFDs in an allocation round.
Government published a draft of the Contract allocation framework, setting out the proposed requirements of R8 on the 1st of June, inviting stakeholder views, and the final version will be published in early July before the round opens to applications. And I would say certainly as far as the process of, um, those who are um, perhaps. Coming into the allocation round or having their eligibility queried and then coming into the rounds at the end of the process. Um, if noble Lords would like a complete explanation of how that works, that can be given, but that will take us several hours, uh, further discussion.
So I hope noble lords will take it from me, um, that this does actually work, uh, in terms of actually making sure that we don't have unforeseen outcomes when the allocation round process actually takes place. Now, my Lords, these amendments received strong stakeholder support in the recent public consultation. There was broad stakeholder recognition that the changes will improve the experience of applicants during the assessment process, support more effective competition and help to secure better value for money for consumers. And this approach reflects the department's continued close engagement with industry in the development of the CFD scheme, and by building on the foundations laid in R7.
These regulations, I believe, will help strengthen procedures and simplify the operation of the scheme and introduce provisions that drive progress towards a 2030 clean power target while securing better value for money for bill payers. And I therefore commend these regulations to the Committee and beg to move.
18:48
18:48
18:48
18:48
Speaker 19
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Speaker 19
The Minister, and he is the one Minister. I know if we did ask for 1.5 hour explanation, he would be able to do it without notes. And because of his deep knowledge, when I looked at the explanatory note, I did see that it said these regulations concern arrangements for determining whether renewables projects qualify for contracts for difference. So I want to really just take that theme about a specific area. And he mentioned R5. And of course, R5 was pretty disastrous generally, but there was a bright spot in it.
And it's an area where I have to congratulate the previous government on a very wise decision in including geothermal energy for the first time. And I was privileged, I think, three months ago, to officially open the United Downs, geothermal electricity station down in Cornwall, near where I'm resident and have been a proponent of geothermal for some time. Um, but what I wanted to ask the minister in that area in terms of determining what renewables actually qualify for CFD rounds, is whether geothermal and obviously the great bright product of some of this technology is the critical mineral of lithium, which is really important to our future industrial success in this country.
But whether the government would see that geothermal will continue to be one of the areas that is ring fenced in as a technology in future rounds. But I would also like to ask the minister, and it really comes back to his past, as when he was a member of Parliament in Southampton, geothermal energy was important there for heating and given the government's strong will to broaden the application of CFDs, um geothermal in many ways is even more suited for heating. District heating. Beyond combined heat and power schemes, which can be CFD related.
So I'd be interested in the minister's um, view as to whether the government would see in the future that geothermal heating could be part of a future, um, CFD round.
And it's an area where I have to congratulate the previous government on a very wise decision in including geothermal energy for the first time. And I was privileged, I think, three months ago, to officially open the United Downs, geothermal electricity station down in Cornwall, near where I'm resident and have been a proponent of geothermal for some time. Um, but what I wanted to ask the minister in that area in terms of determining what renewables actually qualify for CFD rounds, is whether geothermal and obviously the great bright product of some of this technology is the critical mineral of lithium, which is really important to our future industrial success in this country.
But whether the government would see that geothermal will continue to be one of the areas that is ring fenced in as a technology in future rounds. But I would also like to ask the minister, and it really comes back to his past, as when he was a member of Parliament in Southampton, geothermal energy was important there for heating and given the government's strong will to broaden the application of CFDs, um geothermal in many ways is even more suited for heating. District heating. Beyond combined heat and power schemes, which can be CFD related.
So I'd be interested in the minister's um, view as to whether the government would see in the future that geothermal heating could be part of a future, um, CFD round.
18:50
Speaker 17
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Speaker 17
My Lords, I rise to respond to the draft contracts for difference Allocation Amendment Regulations 2026. Can I again thank the Minister for his introduction?Clearly, this stuff is more complicated than eBay. I also thank my noble friend for raising important questions about geothermal, that I hope the minister can come to answer, but obviously we support that. The inclusion and the further development of that technology within our renewables energy mix. Um, turning to these regulations, these are modest but worthwhile technical reforms to the contracts for difference scheme.
And they have our support. So we will be supporting this today. Um auction rounds as we know, are an extremely important part. The central part of our drive to clean energy and the energy transition 2030 and net zero, 2050. And as the explanatory note sets out, competition has grown. So it is absolutely essential and also welcome that actually between rounds that the government is undertaking these, these fundamental reviews of the way these complicated auction rounds are working in practice.
So we welcome the fact that that that has happened and has happened with with stakeholders and that the government is looking to improve and streamline these systems. Um, so just turning to the first, the, the reforms themselves. The first one involving, as the minister has set out, is to review the process for non-qualification decisions. And applicants will now be able to submit new evidence when requesting a review. And we welcome this. And this is overdue. And this is clearly a sensible reform that when they've got so far in the process for the for the sake of one mistake on the form, it would be silly not to do that.
Um, we know that R seven is a minister has said had many applications failed due to just very minor omissions. So you know this this is welcome. Um allowing corrections at review stage will reduce unnecessary exclusion and improve fairness. So the the second reform allows the delivery body to amend non-qualification decisions where a framework permits. This introduces much needed flexibility into what was previously a very perhaps overly rigid process, and enables errors to be corrected without needing to process further to costly appeals.
And then the third change is um regulations seven and eight strengthen the treatment of pending applications. The definition is extended. So those still within appeal windows can submit sealed bids while regulations regulation eight ensures that those bids cannot be disclosed. So this is an important safeguard for the integrity of the auction process. I won't ask the minister to give us a two hour explanation, but, um, taken together, these changes are administrative, but they are meaningful and will help make the process more streamlined and efficient.
They reduce barriers, improve fairness, strengthen confidence in the system, and they come, as the minister said, a significant moment in our transition. As the minister pointed out himself, allocation round seven was a was a landmark, minister said, the largest in European history, 14.7GW across 201 projects and over £22 billion of investment. The largest of our round to date as well. And of course, coming after previous problems, we had around R7, it was extremely welcomed that it was successful. And I also welcome the fact that the government has brought forward the decisions, um, to bring AR eight forward to July 2026, and that maintains momentum.
Momentum sends a clear signal of the UK's commitment to the clean Power 2030 ambitions, and that is in turn good for industry and for showing a clear path to investment to our renewable future. I just have a couple of questions, just generally, if I could, since we're here debating this today. So on contract length for CFDs, um, we welcome the fact that the government has already extended the contracts from 15 to 20 years. The minister will be aware that it's my party policy that we would like to see those contracts for CFDs extended further to 25 years.
And with the asset lifetime stretching from 25 to 30 years, I just really want to ask the government and the minister or the minister whether whether that was something that the government was open, is actively considering. Is that on the agenda?Obviously, the prices the strike prices at the last auction were above previous rounds of auctions. There are several reasons for that. Primarily, global inflation pressures, and there is a need in the next round to make sure, obviously, that we set a competitive price, one that recognises that inflation is there.
So just a quick question to the minister really about those calculations the government's making for R eight, because obviously inflationary pressures are still there. And in fact they're exaggerating a bit while making sure that we we get a successful auction at a good price on grid connections. It was in the press today. I, I presume it's accurate that the government's now secured grid connections for half of the projects needed to get us to Clean Power 2030. So I'm pleased to see that the grid reforms are having impact.
And we are making that progress. Um, but we've got a lot coming through the system. So I'm just just a word from the minister, just on the reassurance that those we're getting a lot of projects bunched together. So just want to make sure we're not becoming too much of a product of our own success, that we're creating bottlenecks in the system and that, that, that is there, um, on onshore wind. So actually the, the last round R seven, we actually only secured, I think it was 1.3GW of onshore wind.
I recognize the government has removed the planning, the effective effective planning restrictions that previously existed. I just to my mind, I think there's more to do. So a bit like my honourable friend has raised. Uh, geothermal. I really just wanted to ask the minister a quick question about what more can be done to further kick start onshore wind and onshore wind investment, particularly whether what the government's thinking was in relation to R eight. So just to conclude, there, these regulations are sensible, proportionate.
The government clearly worked with stakeholders. They have stakeholder support. Uh, we welcome them. And we're we're pleased to see that these really detailed reviews are happening between these really essential and important auction processes.
And they have our support. So we will be supporting this today. Um auction rounds as we know, are an extremely important part. The central part of our drive to clean energy and the energy transition 2030 and net zero, 2050. And as the explanatory note sets out, competition has grown. So it is absolutely essential and also welcome that actually between rounds that the government is undertaking these, these fundamental reviews of the way these complicated auction rounds are working in practice.
So we welcome the fact that that that has happened and has happened with with stakeholders and that the government is looking to improve and streamline these systems. Um, so just turning to the first, the, the reforms themselves. The first one involving, as the minister has set out, is to review the process for non-qualification decisions. And applicants will now be able to submit new evidence when requesting a review. And we welcome this. And this is overdue. And this is clearly a sensible reform that when they've got so far in the process for the for the sake of one mistake on the form, it would be silly not to do that.
Um, we know that R seven is a minister has said had many applications failed due to just very minor omissions. So you know this this is welcome. Um allowing corrections at review stage will reduce unnecessary exclusion and improve fairness. So the the second reform allows the delivery body to amend non-qualification decisions where a framework permits. This introduces much needed flexibility into what was previously a very perhaps overly rigid process, and enables errors to be corrected without needing to process further to costly appeals.
And then the third change is um regulations seven and eight strengthen the treatment of pending applications. The definition is extended. So those still within appeal windows can submit sealed bids while regulations regulation eight ensures that those bids cannot be disclosed. So this is an important safeguard for the integrity of the auction process. I won't ask the minister to give us a two hour explanation, but, um, taken together, these changes are administrative, but they are meaningful and will help make the process more streamlined and efficient.
They reduce barriers, improve fairness, strengthen confidence in the system, and they come, as the minister said, a significant moment in our transition. As the minister pointed out himself, allocation round seven was a was a landmark, minister said, the largest in European history, 14.7GW across 201 projects and over £22 billion of investment. The largest of our round to date as well. And of course, coming after previous problems, we had around R7, it was extremely welcomed that it was successful. And I also welcome the fact that the government has brought forward the decisions, um, to bring AR eight forward to July 2026, and that maintains momentum.
Momentum sends a clear signal of the UK's commitment to the clean Power 2030 ambitions, and that is in turn good for industry and for showing a clear path to investment to our renewable future. I just have a couple of questions, just generally, if I could, since we're here debating this today. So on contract length for CFDs, um, we welcome the fact that the government has already extended the contracts from 15 to 20 years. The minister will be aware that it's my party policy that we would like to see those contracts for CFDs extended further to 25 years.
And with the asset lifetime stretching from 25 to 30 years, I just really want to ask the government and the minister or the minister whether whether that was something that the government was open, is actively considering. Is that on the agenda?Obviously, the prices the strike prices at the last auction were above previous rounds of auctions. There are several reasons for that. Primarily, global inflation pressures, and there is a need in the next round to make sure, obviously, that we set a competitive price, one that recognises that inflation is there.
So just a quick question to the minister really about those calculations the government's making for R eight, because obviously inflationary pressures are still there. And in fact they're exaggerating a bit while making sure that we we get a successful auction at a good price on grid connections. It was in the press today. I, I presume it's accurate that the government's now secured grid connections for half of the projects needed to get us to Clean Power 2030. So I'm pleased to see that the grid reforms are having impact.
And we are making that progress. Um, but we've got a lot coming through the system. So I'm just just a word from the minister, just on the reassurance that those we're getting a lot of projects bunched together. So just want to make sure we're not becoming too much of a product of our own success, that we're creating bottlenecks in the system and that, that, that is there, um, on onshore wind. So actually the, the last round R seven, we actually only secured, I think it was 1.3GW of onshore wind.
I recognize the government has removed the planning, the effective effective planning restrictions that previously existed. I just to my mind, I think there's more to do. So a bit like my honourable friend has raised. Uh, geothermal. I really just wanted to ask the minister a quick question about what more can be done to further kick start onshore wind and onshore wind investment, particularly whether what the government's thinking was in relation to R eight. So just to conclude, there, these regulations are sensible, proportionate.
The government clearly worked with stakeholders. They have stakeholder support. Uh, we welcome them. And we're we're pleased to see that these really detailed reviews are happening between these really essential and important auction processes.
18:58
Speaker 18
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Speaker 18
My Lords, um, can I start by thanking the noble Lord, the Minister, for his very kind opening remarks, which I greatly appreciate. Um, it's good to be back. It's good to be back. And as he says, always a constructive and convivial, um, exchange of views with the noble Lord. The minister. Um and I'm sure that will continue to be the case even in the very late nights. I anticipate we'll be debating the energy bill when it comes before the House.
Um, but can I, um, also say. That in the 4 or 5 months that I did this job before leaving the house to come back in a new incarnation, um, I'm deeply. Grateful to his private office as well for always being highly professional and responding quickly to any requests from this side of the house. So, um, through him, I'd be grateful if he could pass that on. Um, I'm also grateful to the noble Lord, Lord Teverson, except that I want to correct him on one point, which is very difficult because his knowledge is as extensive on the subject of energy as indeed is the minister's.
Um, when I was Minister for energy back in 1990, we launched the first support for geothermal energy. It was part of the non-fossil fuel obligation, which was the precursor of the current regimes. And we had a series of technology bands, and one of them was geothermal. And we felt it was very important that it should be recognised as an important, um, part of the renewable energy programme moving forward. So it's a long time ago and it may not have made huge progress in the intervening decades, but nevertheless, it was certainly identified and as an important part of that work at that time.
And I echo what he says about its continued importance in the context of renewable energy. Um, now this I am appreciate is, is not a statutory instrument that has been.
Um, but can I, um, also say. That in the 4 or 5 months that I did this job before leaving the house to come back in a new incarnation, um, I'm deeply. Grateful to his private office as well for always being highly professional and responding quickly to any requests from this side of the house. So, um, through him, I'd be grateful if he could pass that on. Um, I'm also grateful to the noble Lord, Lord Teverson, except that I want to correct him on one point, which is very difficult because his knowledge is as extensive on the subject of energy as indeed is the minister's.
Um, when I was Minister for energy back in 1990, we launched the first support for geothermal energy. It was part of the non-fossil fuel obligation, which was the precursor of the current regimes. And we had a series of technology bands, and one of them was geothermal. And we felt it was very important that it should be recognised as an important, um, part of the renewable energy programme moving forward. So it's a long time ago and it may not have made huge progress in the intervening decades, but nevertheless, it was certainly identified and as an important part of that work at that time.
And I echo what he says about its continued importance in the context of renewable energy. Um, now this I am appreciate is, is not a statutory instrument that has been.
18:59
Speaker 10
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Speaker 10
Uh, the minister. Um, but this is nothing more. And for once, the minister will not be in a position to say to me that I've gone beyond the brief of what's in front of us, because I have no intention of doing so. This is a a knee. So error primer. And it is purely that. And if you look at the explanatory note at the back regulations three, four, five, six and seven all refer to the fact that where NE so makes errors in the highly complicated system that government have asked them to study.
There are measures and procedures by which they can correct those errors. These regulations, uh, allow the National energy system operator NI. So to issue amended non-qualification determinations to correct their own errors. The primary impact is that NI so can now disqualify projects previously approved by them in error, injecting significant, I might add, project risk to investors and indeed to those putting forward the proposals. Um how does this impact on developers. Well, it's clear in the in the statutory instrument.
Um there is retroactive. Now disqualification risk. Um Niso is now empowered to issue corrected notices to projects that were wrongly deemed qualified at the assessment stage, stripping away previously approved allocation status. There are reinstated appeal rights if a developer receives an amended non-qualification determination, they maintain their legal right to challenge the decision via the standard two tier appeal system, and there are contractual safeguards. But on the contractual safeguards, I do ask the minister, um, what about projects that are ultimately caught in delays or queues reshuffling due to Nyssa's wider connection reform programme?Um, the this error prima is is recognised as such.
And very early on when the bold headline is delivery body error in notices of determinations, I quote under our section four. Um, so the reason why the industry is pleased about this is because at least we now have a framework to go back to. NI. So should errors have been made in the process of the CFD applications?Um they allow Niso to consider additional documents. Um additional documentary evidence or information when considering appeals from applicants whose applications have been determined by NI.
So to be non-qualifying and it clarifies how Niso should treat pending applications where decisions on the eligibility of those applications remain undetermined at the point at which the regulations require Niso to proceed with the contract allocation process. In other words, to commence the process leading to the decision on the award of contracts to successful applicants. Now, I'm absolutely in favour of recognising that a government body will make mistakes, and that there needs to be a framework of, um, of addressing those mistakes. And potential applicants needs to be aware of them.
I'm quite surprised. I don't think I've ever known in 40 odd years a statutory instrument which effectively says, by the way, this is what we're going to do when we make mistakes, but at least it is clear to industry, and I'm not surprised the majority of them supported it. I looked at all the responses from different industry members. It wasn't unanimous by any means that they supported these changes, but it did leave me with the thought that, um Niso has providing themselves with a shovel to dig themselves out of a, of a hole.
Um, and actually, whilst on the subject of mistakes, I decided to have a good look at the um the website and on the front page of the website it says the average tenure of employees is 5.9 years. But I thought it was only established on the 1st of October 2024. So maybe there are a whole series of, of different errors that need to be addressed by NI. So, um, it doesn't inspire confidence in my Lords. This SI1 would have hoped that there was a proper framework already established to address any appeals that come forward, um, on this extremely important policy, which is, in the words of the minister himself, is the flagship government policy.
Um, it's a great pity that only after a whole series of errors, which he has called minor errors, but there's no guarantee that there will be minor, they could be significant errors. And in the light of anybody who's in receipt of an approval to be told that now they've just had a look at it again and it's not going to be approved. That isn't a minor error. That is a matter of real concern with major financial consequences. So I realize the need to put this into an s I.
I've never seen it before. It is an extraordinary primer. Um, but with that in mind and with the recognition that the government have opened up and accepted that this is happening, um, and put forward proposals to remedy it, it will meet with the agreement of this side of the committee, but I think it is an extraordinary, um, admission by the government that has to come forward with a specific statutory instrument to address all the errors. Its own flagship body is making.
There are measures and procedures by which they can correct those errors. These regulations, uh, allow the National energy system operator NI. So to issue amended non-qualification determinations to correct their own errors. The primary impact is that NI so can now disqualify projects previously approved by them in error, injecting significant, I might add, project risk to investors and indeed to those putting forward the proposals. Um how does this impact on developers. Well, it's clear in the in the statutory instrument.
Um there is retroactive. Now disqualification risk. Um Niso is now empowered to issue corrected notices to projects that were wrongly deemed qualified at the assessment stage, stripping away previously approved allocation status. There are reinstated appeal rights if a developer receives an amended non-qualification determination, they maintain their legal right to challenge the decision via the standard two tier appeal system, and there are contractual safeguards. But on the contractual safeguards, I do ask the minister, um, what about projects that are ultimately caught in delays or queues reshuffling due to Nyssa's wider connection reform programme?Um, the this error prima is is recognised as such.
And very early on when the bold headline is delivery body error in notices of determinations, I quote under our section four. Um, so the reason why the industry is pleased about this is because at least we now have a framework to go back to. NI. So should errors have been made in the process of the CFD applications?Um they allow Niso to consider additional documents. Um additional documentary evidence or information when considering appeals from applicants whose applications have been determined by NI.
So to be non-qualifying and it clarifies how Niso should treat pending applications where decisions on the eligibility of those applications remain undetermined at the point at which the regulations require Niso to proceed with the contract allocation process. In other words, to commence the process leading to the decision on the award of contracts to successful applicants. Now, I'm absolutely in favour of recognising that a government body will make mistakes, and that there needs to be a framework of, um, of addressing those mistakes. And potential applicants needs to be aware of them.
I'm quite surprised. I don't think I've ever known in 40 odd years a statutory instrument which effectively says, by the way, this is what we're going to do when we make mistakes, but at least it is clear to industry, and I'm not surprised the majority of them supported it. I looked at all the responses from different industry members. It wasn't unanimous by any means that they supported these changes, but it did leave me with the thought that, um Niso has providing themselves with a shovel to dig themselves out of a, of a hole.
Um, and actually, whilst on the subject of mistakes, I decided to have a good look at the um the website and on the front page of the website it says the average tenure of employees is 5.9 years. But I thought it was only established on the 1st of October 2024. So maybe there are a whole series of, of different errors that need to be addressed by NI. So, um, it doesn't inspire confidence in my Lords. This SI1 would have hoped that there was a proper framework already established to address any appeals that come forward, um, on this extremely important policy, which is, in the words of the minister himself, is the flagship government policy.
Um, it's a great pity that only after a whole series of errors, which he has called minor errors, but there's no guarantee that there will be minor, they could be significant errors. And in the light of anybody who's in receipt of an approval to be told that now they've just had a look at it again and it's not going to be approved. That isn't a minor error. That is a matter of real concern with major financial consequences. So I realize the need to put this into an s I.
I've never seen it before. It is an extraordinary primer. Um, but with that in mind and with the recognition that the government have opened up and accepted that this is happening, um, and put forward proposals to remedy it, it will meet with the agreement of this side of the committee, but I think it is an extraordinary, um, admission by the government that has to come forward with a specific statutory instrument to address all the errors. Its own flagship body is making.
19:05
Speaker 7
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Speaker 7
Well, I thank noble Lords for, again, their very constructive and interesting contributions this afternoon. Uh, and, uh, I will attempt to address them, uh, as best I can. Uh, I don't think I'll have to write to anybody, but, if necessary, I will, of course, uh, make sure that is done. Um. As far as, uh, the. Contribution from a noble Lord Teverson. Um, who I have worked with very successfully over, um, a number of years, both in all party groups and, uh, uh.
And as, uh, opposition, uh, energy minister, uh, I've always found him, uh, to be, uh, very constructive, very helpful. And indeed, he has been particularly helpful today. Um, by, um, raising the issue of geothermal, which, as he will know, is one of the issues closest to my heart over a very long period of time. And I might add that the Southampton geothermal scheme came in seven years before the government. Actually recognised that geothermal had some, uh, uh. In in interest.
Um and future. And I do acknowledge that that was what was done, uh, in 1990. Um, but the Southampton scheme had been up and running for seven years before that. Um but that's a very minor point. Um. Noble lord. Uh, teverson. Uh. Does um. Put a number of important points forward concerning what is likely to happen to geothermal in general?Um, do we think that it is a very important technology for the future?Yes, we do.
We particularly think it's a very important technology, uh, in terms of the. The, uh, role. Out of heat networks that is taking place at the moment and being one important low carbon source for informing those, um, heat networks, it's pretty good. Uh, in terms of. Ensure that if you are to have a low carbon alternative to what is normally the case in heat networks, which is a gas engine. Uh, high carbon gas engine, uh, going into the scheme, then geothermal, uh, can be, uh, a very efficient and indeed long lasting, virtually permanent alternative to that gas engine.
Uh, putting the heat around the network. But there are, of course, uh. Questions to answer about the CapEx involved with that process and how that is, uh, undertaken, whether it's undertaken jointly with the. With the heat network or whether it's in addition to a heat network that's already existent. Uh, and also to the, uh. Way in which geothermal can or may not be eligible for the AR process. And of course, the noble Lord will know that geothermal is not just one thing.
Sedimentary geothermal, which is normally drilled. I must shut up about this in a minute. Um, it is normally drilled at, um. Shallower depths. Uh, and gets heat up from aquifers and associated activities and then goes through a heat transfer arrangement. And then you have much deeper geothermal. Which can actually go far deeper and penetrate, for example, hot rocks, which is what is happening in Cornwall, which the noble Lord opened up. I was unfortunately unable to be there on the opening day.
Um, but I was very glad he was the person, uh, chosen to open those proceedings. But he will know that, um, that those particular schemes, which are three, uh, one of which is now operational, um, are all about producing mainly electricity. Interestingly, lithium extraction as a, as a, as a byproduct, um, but are not strictly comparable with the sedimentary geothermal, which are all about heat elsewhere in the country. And there are indeed much greater prospects than were hitherto thought for both sedimentary thermal and indeed for hot rocks.
Um, but as he has mentioned, it was a, you might say, almost a lucky accident of AR five, that the miserable outcome of AR five was tempered somewhat by the fact that because there were no bids in in, in the main pot, geothermal, uh, actually, uh, managed to. Get its bids in at that particular point. Now to, to, to bring that together for AR eight and future allocation rounds. Clearly, um, I. Allocation rounds are based on production of electricity. So heat based, purely heat based geothermal would not qualify.
And um clearly needs to be supported by uh, if it is to be supported by other means, then the allocation round process. So as far as AR eight is concerned. Um, I, I mean, the question of the pots and so on is still being determined, but it's certainly the case that um, heat based, purely heat based geothermal, um, would not necessarily well won't qualify, uh, in the future. Um, and then we have the question of um, you know. Downs scheme, which is, uh, or schemes which we await the outcome of the other two schemes.
And of course they have a great deal on their plate at the moment, so I'm not sure whether they're going to bid for a lot more schemes right this minute. But that's where we stand as far as geothermal and allocation rounds are concerned, the noble. Lord. Russell. Um. Uh, was. Concerned about the. Uh, the extension of, I mean, sorry, not not concerned about extension of the CFD from 15 to 20 years in the most recent rounds.
Um, and I note his party's policy to take that even further. Um, now the extension of. 15 to 20 years certainly was a measure to make sure that those people had who are bidding into the system had good, uh, regulated cover, uh, for their product for a reasonable number of years, which then has a reflection, uh, obviously on the. The amortization, amortization of the capital, uh, process and the security that that gives. And, clearly that was a factor in making sure that so many people got into the allocation rounds, both bid and succeeded.
Uh, whether that 20 years, uh, needs extending further as far as offshore wind is concerned, uh, is. Uh, something which I think, uh, will need to be looked at in terms of the experience of R eight and possibly R nine. And indeed the practical outcome of R seven. So it appears at first sight that that's been a very positive extension. But of course um as the noble Lord will know, there were um different levels. Of CFD provision for example, for Hinkley.
Uh so it is, it is not the case that um CDS. Are one size fits all as far as uh, as far as, uh, those terms are concerned. He asks also the question of, um, the. Onshore onshore wind and what is being done about that. Uh, and of course, there is a lot happening, uh, as far as onshore is concerned. Um, in addition to offshore, uh, both in terms of its, its access to the AR, uh, process. Which it previously effectively was banned from.
Um, but also, uh, in terms of not just, um, powering new onshore schemes, but repowering existing onshore schemes. And he will know that the, uh, the. Intention to bring in repowering, uh, to the AR process, if that can be done. And that in itself would be a considerable step forward. For example, in the three fold additions that one can get from repowering on sites that have hitherto worked to a much lower capacity in the past. Um, I, I think I have responded to, uh, Lord Russell's, uh, points.
Um, but if he, if he doesn't think that's proper, I can certainly take that up in writing now. Um, noble Lord, Lord Moynihan, uh. I guess he's right. Pretty much that, um. This is not exactly a primer in covering one's mistakes up, but it is certainly a it is a recognition that what we have to do, uh, as far as allocation rounds in the future is concerned, is make sure that everyone who is applying, coming into the scheme is not thrown out for trivial reasons, um, or, or finds that they have, they have got a, um, a.
Non qualification, uh, result, which is. Overturned later on on appeal to a qualification, but that they are then too late for an allocation round to consider them. And he's mentioned himself about the question of sealed bids, uh, being as it were, suspended whilst those appeals take place. And one of the mechanisms in here is to make sure that, um, not only can someone who has previously not qualified, but then is decided to qualify, but then meanwhile the allocation process has gone on, doesn't land in the middle of the qualification process in a way that disrupts the rest of the process.
Because in theory, if someone comes into the system, say, between results and declaration, um, then in theory they would splash into the system in such a way that other people have previously been allocated, uh, would then find that their allocation had been disallowed. And that's a process of the bidding system. But, uh, what these amendments do, and I promise this wasn't going to be two hours, um, was. Yes. Thank you. Um, what this, uh, what these changes do is make sure that the system overall, uh, is not discomforted by that sort of process where though it may be, uh, and also that it is fair to those people who have already qualified in the system.
And so, uh, yes. This will happen. The large number of applications means that occasionally mistakes will need to be rectified. But the purpose of these changes is to make sure that that rectification is as positive as it can be for the process as a whole, and that people get fair outcomes. Um, regardless of the way in which they have travelled to get the allocation approved in the end. Hope the noble Lord will accept the positive outcome of these changes and what they will be for the allocation process in the future.
And I'm very pleased that he has, uh, given his support to these changes, but I hope it will be a positive support on the grounds of the way that the system will work in the future to the benefit of all. To me. I beg to move.
And as, uh, opposition, uh, energy minister, uh, I've always found him, uh, to be, uh, very constructive, very helpful. And indeed, he has been particularly helpful today. Um, by, um, raising the issue of geothermal, which, as he will know, is one of the issues closest to my heart over a very long period of time. And I might add that the Southampton geothermal scheme came in seven years before the government. Actually recognised that geothermal had some, uh, uh. In in interest.
Um and future. And I do acknowledge that that was what was done, uh, in 1990. Um, but the Southampton scheme had been up and running for seven years before that. Um but that's a very minor point. Um. Noble lord. Uh, teverson. Uh. Does um. Put a number of important points forward concerning what is likely to happen to geothermal in general?Um, do we think that it is a very important technology for the future?Yes, we do.
We particularly think it's a very important technology, uh, in terms of the. The, uh, role. Out of heat networks that is taking place at the moment and being one important low carbon source for informing those, um, heat networks, it's pretty good. Uh, in terms of. Ensure that if you are to have a low carbon alternative to what is normally the case in heat networks, which is a gas engine. Uh, high carbon gas engine, uh, going into the scheme, then geothermal, uh, can be, uh, a very efficient and indeed long lasting, virtually permanent alternative to that gas engine.
Uh, putting the heat around the network. But there are, of course, uh. Questions to answer about the CapEx involved with that process and how that is, uh, undertaken, whether it's undertaken jointly with the. With the heat network or whether it's in addition to a heat network that's already existent. Uh, and also to the, uh. Way in which geothermal can or may not be eligible for the AR process. And of course, the noble Lord will know that geothermal is not just one thing.
Sedimentary geothermal, which is normally drilled. I must shut up about this in a minute. Um, it is normally drilled at, um. Shallower depths. Uh, and gets heat up from aquifers and associated activities and then goes through a heat transfer arrangement. And then you have much deeper geothermal. Which can actually go far deeper and penetrate, for example, hot rocks, which is what is happening in Cornwall, which the noble Lord opened up. I was unfortunately unable to be there on the opening day.
Um, but I was very glad he was the person, uh, chosen to open those proceedings. But he will know that, um, that those particular schemes, which are three, uh, one of which is now operational, um, are all about producing mainly electricity. Interestingly, lithium extraction as a, as a, as a byproduct, um, but are not strictly comparable with the sedimentary geothermal, which are all about heat elsewhere in the country. And there are indeed much greater prospects than were hitherto thought for both sedimentary thermal and indeed for hot rocks.
Um, but as he has mentioned, it was a, you might say, almost a lucky accident of AR five, that the miserable outcome of AR five was tempered somewhat by the fact that because there were no bids in in, in the main pot, geothermal, uh, actually, uh, managed to. Get its bids in at that particular point. Now to, to, to bring that together for AR eight and future allocation rounds. Clearly, um, I. Allocation rounds are based on production of electricity. So heat based, purely heat based geothermal would not qualify.
And um clearly needs to be supported by uh, if it is to be supported by other means, then the allocation round process. So as far as AR eight is concerned. Um, I, I mean, the question of the pots and so on is still being determined, but it's certainly the case that um, heat based, purely heat based geothermal, um, would not necessarily well won't qualify, uh, in the future. Um, and then we have the question of um, you know. Downs scheme, which is, uh, or schemes which we await the outcome of the other two schemes.
And of course they have a great deal on their plate at the moment, so I'm not sure whether they're going to bid for a lot more schemes right this minute. But that's where we stand as far as geothermal and allocation rounds are concerned, the noble. Lord. Russell. Um. Uh, was. Concerned about the. Uh, the extension of, I mean, sorry, not not concerned about extension of the CFD from 15 to 20 years in the most recent rounds.
Um, and I note his party's policy to take that even further. Um, now the extension of. 15 to 20 years certainly was a measure to make sure that those people had who are bidding into the system had good, uh, regulated cover, uh, for their product for a reasonable number of years, which then has a reflection, uh, obviously on the. The amortization, amortization of the capital, uh, process and the security that that gives. And, clearly that was a factor in making sure that so many people got into the allocation rounds, both bid and succeeded.
Uh, whether that 20 years, uh, needs extending further as far as offshore wind is concerned, uh, is. Uh, something which I think, uh, will need to be looked at in terms of the experience of R eight and possibly R nine. And indeed the practical outcome of R seven. So it appears at first sight that that's been a very positive extension. But of course um as the noble Lord will know, there were um different levels. Of CFD provision for example, for Hinkley.
Uh so it is, it is not the case that um CDS. Are one size fits all as far as uh, as far as, uh, those terms are concerned. He asks also the question of, um, the. Onshore onshore wind and what is being done about that. Uh, and of course, there is a lot happening, uh, as far as onshore is concerned. Um, in addition to offshore, uh, both in terms of its, its access to the AR, uh, process. Which it previously effectively was banned from.
Um, but also, uh, in terms of not just, um, powering new onshore schemes, but repowering existing onshore schemes. And he will know that the, uh, the. Intention to bring in repowering, uh, to the AR process, if that can be done. And that in itself would be a considerable step forward. For example, in the three fold additions that one can get from repowering on sites that have hitherto worked to a much lower capacity in the past. Um, I, I think I have responded to, uh, Lord Russell's, uh, points.
Um, but if he, if he doesn't think that's proper, I can certainly take that up in writing now. Um, noble Lord, Lord Moynihan, uh. I guess he's right. Pretty much that, um. This is not exactly a primer in covering one's mistakes up, but it is certainly a it is a recognition that what we have to do, uh, as far as allocation rounds in the future is concerned, is make sure that everyone who is applying, coming into the scheme is not thrown out for trivial reasons, um, or, or finds that they have, they have got a, um, a.
Non qualification, uh, result, which is. Overturned later on on appeal to a qualification, but that they are then too late for an allocation round to consider them. And he's mentioned himself about the question of sealed bids, uh, being as it were, suspended whilst those appeals take place. And one of the mechanisms in here is to make sure that, um, not only can someone who has previously not qualified, but then is decided to qualify, but then meanwhile the allocation process has gone on, doesn't land in the middle of the qualification process in a way that disrupts the rest of the process.
Because in theory, if someone comes into the system, say, between results and declaration, um, then in theory they would splash into the system in such a way that other people have previously been allocated, uh, would then find that their allocation had been disallowed. And that's a process of the bidding system. But, uh, what these amendments do, and I promise this wasn't going to be two hours, um, was. Yes. Thank you. Um, what this, uh, what these changes do is make sure that the system overall, uh, is not discomforted by that sort of process where though it may be, uh, and also that it is fair to those people who have already qualified in the system.
And so, uh, yes. This will happen. The large number of applications means that occasionally mistakes will need to be rectified. But the purpose of these changes is to make sure that that rectification is as positive as it can be for the process as a whole, and that people get fair outcomes. Um, regardless of the way in which they have travelled to get the allocation approved in the end. Hope the noble Lord will accept the positive outcome of these changes and what they will be for the allocation process in the future.
And I'm very pleased that he has, uh, given his support to these changes, but I hope it will be a positive support on the grounds of the way that the system will work in the future to the benefit of all. To me. I beg to move.