UK Infrastructure Bank Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Committee stage & Lords Hansard - Part 1
Tuesday 14th June 2022 Lords Chamber

[Lord Ravensdale (CB)]

My Lords, I shall speak to Amendment 6 in my name and start by declaring my interests as a project director and engineer with Atkins, and as a director of Peers for the Planet.

The problem we have, in my view, is that the second objective of the UK investment bank—to support local and regional economic growth—does not provide a clear policy intent for what the bank is to do in relation to levelling up. Getting these objectives right from the start is crucial. As the noble Lord, Lord Tunnicliffe, said at Second Reading,

“the most important debates will focus on the Government’s definition of infrastructure and the scope of the two core objectives. We must get these core components right from the off”—[Official Report, 24/5/22; cols. 824-5.]

As I said at Second Reading, the current wording leaves much open to interpretation. Almost any infrastructure investment anywhere in the country could be argued to support economic growth in the region or local area in which it sits. A new transport scheme in a wealthy area of Sussex, for example, would meet this criterion by supporting local and regional economic growth. There is nothing to clarify that this refers to levelling up, or to economically disadvantaged areas. I listened carefully to what the Minister had to say in response to this at Second Reading—she stated that the policy intent is clear—but I believe the Bill would benefit from setting out in more detail exactly what this goal entails, which I will come to shortly.

I briefly remind noble Lords of the issues we are facing here. The levelling-up White Paper stated:

“The UK has larger geographical differences than many other developed countries on multiple measures, including productivity, pay, educational attainment and health.”


As the Economist put it recently:

“Britain is highly geographically unequal ... It is as if America’s rust belt or the former East Germany were home to half the population.”


As an example, I took a walk through central Derby on Sunday and asked my sons to count the number of empty shop units. We counted 14 over a 200-metre stretch in the city centre, from Iron Gate to Corn Market. The only retail outlets that seemed to be thriving were betting shops—I counted five. This issue is repeated right across the Midlands region. Walking around comparable stretches in London, I see one or two empty units at most. I know the Government get this, and I am looking forward to seeing the Levelling-up and Regeneration Bill come before this House, but it emphasises that we need to make clear what is meant by levelling up in this vital legislation. Although the intent is clear from the Chancellor on his strategic steer to the bank, it needs also to be clear in the legislation. Levelling up is a long-term, generational project, so legislation supporting it must be crystal clear as to what needs to be accomplished. The strategic steer will not set policy intent over the long term; having this clear on the face of the Bill will, as the noble Baroness, Lady Hayman, powerfully argued.

My amendment is straightforward, and I also support Amendment 9 in the name of the right reverend Prelate the Bishop of St Albans and Amendment 7 in the name of the noble Baroness, Lady Bennett, to which I would have added my name had I spotted them in time; they get at the same issues as my amendment. My amendment would strengthen the current wording by referring specifically to reducing

“geographical inequality through supporting regional and local economic growth in areas of economic disadvantage”.

This, I believe, clearly captures the Government’s policy intent for this objective and ensures that the legislation will deliver in the long term for disadvantaged areas, will deliver for the levelling-up agenda, and will make a real difference to the lives of people in those left-behind communities. I would be grateful if the Minister, in her summing up, could expand on how she believes the current wording provides a clear policy intent.

I also strongly support Amendment 4 tabled by the noble Baroness, Lady Hayman. As an example, the UN has called for climate finance to be split equally between efforts to curb and adapt to climate change, but most goes towards mitigation. However, I cannot beat the Cinderella analogy from the noble Baroness, Lady Young of Old Scone. Therefore, it is right that adaption should be split out from the core emissions targets as a specific aim, and I support the words of other noble Lords on why biodiversity should be placed on an equal stature with climate change within the objectives of the bank.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Lord, Lord Ravensdale, whom I thank for his expression of support for Amendment 7.

This is quite a large group of amendments addressing quite a narrow area of the Bill, but clearly this is crucially important. We are talking about the objectives of the bank. It is interesting that it has two objectives listed, one of which, looking at the amendments tabled by your Lordships, we clearly feel is too narrow, and the other of which is insufficiently clear. I will not speak at length to the many amendments here addressing and tackling adaptation, biodiversity and the nature crisis, because, as a Green, I do not need to; it has already been so clearly and explicitly said from all sides of the House that it does not need to come from me. We talk about tackling the climate emergency, but we must also tackle the nature crisis. It is a related and equal threat to the security of us all and it must be in the Bill. Also, the reference by the noble Lord, Lord Teverson, to the circular economy is interesting. I get at this in a different way, in terms of demand reduction and resource-use reduction, in the next group, so I will not go into that in depth now.

As the noble Lord, Lord Ravensdale, made clear, the second objective, to support regional and local economic growth, could mean local growth in Kensington and Chelsea or in the Sheffield constituency of Hallam, which a few years ago had the lowest rate of free school meals of any constituency in the country. The Government’s rhetoric and the discussion around this Bill says that this is supposed to be targeting disadvantaged areas, but there is nothing in the Bill which says that. Both our amendments, and the amendment tabled by the right reverend Prelate the Bishop of St Albans, seek to address this. However, mine also has an extra, intentionally radical element in that it takes out “economic growth”. Your Lordships’ House has heard me say before that we cannot have infinite growth on a finite planet and that chasing after growth is a problem. So, even if we target this on the most disadvantaged areas, which certainly need development, is it economic growth per se that they need? Who is the advantage of that growth and wealth going to?

I quote the Nobel prize-winning economist Joseph Stiglitz, who pointed out that if our measures tell us that everything is fine when really it is not, we will become complacent. Despite the increases in GDP, and despite the 2008 crisis being well behind us, everything is not fine. Growth on its own will not solve the problem of levelling up—even growth directed to those areas. We are seeing considerable moves in parts of government towards recognising this.

I note that the Office for National Statistics has a national well-being programme that has 10 broad dimensions which have been shown to matter to people. They are the natural environment; personal well-being; our relationships; health; what we do; where we live; personal finance; the economy; education and skills; and governance. Looking around the world, the EU Council has defined the economy of well-being as putting people and their well-being at the centre of policy and decision-making. I have referred before in your Lordships’ House to the New Zealand Treasury having produced well-being budgets, which operate by guidance under the living standards framework. It is about improving people’s lives, which is what so many areas of our country desperately need.

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Moved by

[Baroness Bennett of Manor Castle]

10: Clause 2, page 1, line 14, at end insert—
“(c) to reduce to sustainable levels the United Kingdom's use of natural resources and emissions of non-greenhouse pollutants, and(d) to secure the interests of future generations.”Member's explanatory statement
This amendment inserts additional objectives of the Bank to protect future generations, reduce pollution and reduce natural resource use.

[Baroness Bennett of Manor Castle (GP)]

My Lords, in moving Amendment 10 I am rather aware from the Minister’s response to the previous group that this may have been grouped differently in her list compared to mine. I am just going to proceed anyway and if she says “I refer you to my previous answer” at the end, I will understand.

Amendment 10 refers to reducing “to sustainable levels” the UK’s

“use of natural resources and emissions of non-greenhouse pollutants”

and to securing “the interests of future generations.” To address the second part first, I am sure many noble Lords will recognise the language there, which is very much inspired by the Private Member’s Bill of the noble Lord, Lord Bird, about protecting the well-being of future generations—and indeed by the progress made in Wales, with its future generations Act. It is perhaps another way of getting towards first do no harm, as we discussed in the previous group of amendments. But more than that, it is making a larger claim: we know that the natural world in the UK is in a parlous state with air pollution, water pollution, et cetera. It is saying that if we are looking after the well-being of future generations, the bank should be investing to improve the state of things, not just to make sure that they do not get any worse.

The first part of this amendment addresses something that your Lordships’ House and the Government really need to get more focused on, which is planetary limits. In the previous group, we started to talk about how we need to add attention to biodiversity, the state of nature and nature-based solutions, tying together those planetary limits which the world is crossing over. Actually, academics are telling us that we have now broken five of the nine planetary boundaries. Three of those are climate, biodiversity and land system change, which we have already covered to some degree, but we have also come to the other two broken planetary limits. These are biogeochemical flows and what is generally known as pollution from novel entities—in general terminology, we might talk there about chemicals. About 350,000 of these are used in the world, which includes pesticides, antibiotics, plastics, industrial chemicals in mining and pharmaceuticals.

The reason for this amendment adding an objective to the bank, so that it starts to address these issues and reduces the harm done by these chemicals is that we—globally and in the UK—are very much exceeding our share of the limits of these things. This amendment is thus supposed to address both biogeochemical flows and the novel chemicals.

Coming briefly to the biogeochemical flows, the rates of nitrate and phosphate use in the UK are both well above the global average and, according to a global footprint report, we must

“Reduce nitrogen and phosphorus use by at least 80%”

—yes, I did say 80. If we are to have a bank that is investing in the kind of economy we have to live within in future, given the planetary limits, it needs to be thinking about not just climate and nature but the damage being done. Here we get to our farming systems, which is why my previous amendment referred to infrastructure that deals with food production. This is overwhelmingly related to that when we come to phosphorus and nitrogen—although sewage plants have their place. We have to look at this as a whole and see that the bank is essentially investing, for shorthand, in a sustainable economy.

The noble Lord, Lord Teverson, had in the previous group an amendment on the circular economy. That is a necessary and essential step forward but it is not a sufficient step, because we have to make sure not only that we are not treating the planet as a dumping ground—mining materials out of the earth and just dumping them—but that we stop mining those materials, or at least vastly reduce the amount we are mining. That is what my first amendment seeks to achieve. If anyone wants to know where my research, particularly around novel entities, comes from, it is from the Stockholm Resilience Centre, published earlier this year in the journal Environmental Science & Technology.

I will address one other point, which very much goes back—as I think we will do several times in this group—to our debates on the Environment Act: reducing resource use. I refer noble Lords to a report that the WWF put out when we were debating the then Environment Bill on the UK’s overseas land-use footprint. That showed that

“between 2016 and 2018, an average annual area of 21.3 million hectares … was required to supply the UK’s demand for the seven commodities”.

When thinking about what the bank is investing in, we cannot be putting further pressure on other parts of the world through that. This is an attempt to bring in a systems-thinking approach.

I come now to the other amendments in my name in this group, which noble Lords may be pleased to hear are both simpler and shorter. The first is Amendment 18. When we look at the way this Bill is written, it is quite surprising that on infrastructure it says

“roads or other forms of transport”.

This seems a rather odd way round for a Bill that is supposed to be addressing the climate emergency. My amendment seeks to take out the word “roads”. I do not believe that the UK Infrastructure Bank should be investing in any new roads. We know that new roads generate more traffic. For the foreseeable future, on the crucial point of keeping the rise in world temperature below 1.5 degrees, roads and traffic are going to generate significant amounts of greenhouse gases, not to mention all the other impacts such as air and noise pollution. If this investment is going into disadvantaged areas, the last thing they need is more air and noise pollution. Electric vehicles also produce air pollution, with a large amount of the pollution they produce being particulate matter pollution from tyres and brakes. Building new roads in disadvantaged areas makes no environmental, social, economic or well-being sense. I have simply sought to take out the word “roads” and insert “mass” transport. That is obviously what the bank should be investing in, for both environmental and social reasons.

My final point is on my Amendment 25, on something that a number of noble Lords raised at Second Reading. The activities of the bank cover a large number of utilities, obviously including electricity and water, et cetera. The Bill talks about “services” but it is not clear whether “services” includes demand reduction and efficiency. The cleanest, greenest energy we can possibly have is the energy we do not need to use. The UK Infrastructure Bank surely has to be investing in reducing the demand for electricity, heating and water use—in these islands water stress is becoming an increasing issue with the reality of climate change and the adaptation issues we were discussing earlier. The Minister may say that the Bill already covers these demand reduction issues, but I feel that it should say explicitly that the bank should be investing in demand reduction of that which it is investing in the generation of. I beg to move.

[Lord Holmes of Richmond (Con)]

I am pleased to follow the noble Baroness, Lady Bennett, and speak to the amendments in my name in this group. My amendments, grouped under two headings, “environmental restoration” and “human enablement and empowerment”, start with Amendment 13. I think we should have in the Bill that the bank should be prohibited from investing in any projects that are not inclusive by design. What does “inclusive by design” mean? It is simply this: that all users are enabled in whatever that system, infrastructure or structure itself actually is.

I can give a quick example, of where so-called shared space has been laid out across the country, with local authorities using public money to take areas—be that a local piece of public realm, a high street or whatever—which previously were independently accessible by all members of the community. When so-called shared space is put in, kerbs, crossings, road markings and barriers are taken out, and it becomes a free-for-all whereby toddlers and tankers, buses and blind people are somehow able to coexist because of this misguided concept. Public money is being used to take spaces that were previously accessible and make them effectively inaccessible. It is being used effectively to plan out of their local public realm more than one-third of the community. It is critical that in the Bill there is a clear statement of intent that anything that the bank invests in is inclusive by design.

Amendment 19 highlights the critical importance of energy efficiency and security. Much has already been said on energy efficiency, so I shall focus on energy security. There could hardly be a more significant time to make the point of the UK’s need to have greater energy security, and for that to be dramatically enhanced through understanding what it means to have a more local and more environmentally sound supply.

On Amendment 21, there could barely be a more significant piece of infrastructure than clean air. Air in so many parts of this city and other cities across the United Kingdom is actually killing our citizens. If the bank’s objectives are so clearly set as economic, with a capital “E”, clean air fits clearly within that. If we want our citizens, at whatever age or whatever stage they are at, to be fit, happy, healthy and able to develop and deploy all their talents, what they breathe could barely be more significant.

Amendment 22 looks at the UK cash infrastructure. I believe that, for reasons of financial inclusion and resilience, this again should be designated as infrastructure for the purposes of the bank—and perhaps even one stage above that, and designated as critical national infrastructure. For all the arguments around financial inclusion that we ran through in the Financial Services Act 2021—I intend to return to them when the financial services and markets Bill comes to your Lordships’ House—but also for the times in which we live, we need to have resilience in our financial systems. Cash would currently seem to be incredibly significant in providing that resilience, if and when things happen to the digital platforms and systems at local and national level.

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[Baroness Penn (Con)]

My Lords, I commit to the Committee that I and the Government will listen very carefully to our proceedings today and, of course, to the advice from the noble Lord’s committee and other expert advisers to the Government. On the particular discussion we are having on a number of aspects of this Bill, I think we agree on the aims that we want to achieve. We may disagree on the mechanism of it, but that does not mean that the contributions of this Committee will not be taken into account before we get to Report.

I hope that, with all that in mind, the noble Lord, Lord Teverson—oh, I have skipped ahead. I hope that the noble Baroness, Lady Bennett, will withdraw her amendment and that other noble Lords will not move theirs when they are reached.

[Baroness Bennett of Manor Castle (GP)]

I thank the Minister for her encouraging, in some respects, response to this rich debate on this important group. I am sure that noble Lords who have flooded into the Chamber for another purpose will be pleased to know that I will not run through all 14 amendments in the group individually.

In welcoming what the Minister said, the Government say that they regard energy conservation and demand reduction as an important part of the bank’s remit. We all find that encouraging, but I am sensing that the broad mood of the Committee, right around these Benches, is that there is still a very strong desire to see that in the Bill.

I also pick up on the point which I guess the Minister made in reference to my amendment on roads. The Minister said—I think I am quoting directly—that “clean air is covered under climate change”. I direct the Minister to the point I made: about half of the particulate matter pollution from vehicles comes from tyres and brakes. That is not a climate change issue but it is very much an air pollution issue, and it needs to be considered.

I have no doubt that we will keep coming back to Amendment 17 on energy efficiency. The noble Baroness, Lady Young of Old Scone, made the important point that this is not just an environmental issue; it is also a poverty reduction issue, and there is a dual benefit from that.

I want to pick up one issue that I think the Minister did not cover, on the points I made about resource use, pollution and novel chemicals. I understand that, as a Treasury Minister, she may not encounter novel chemicals, phosphates and nitrogen cycles on a daily basis. However, I ask her to go and talk to Defra about those issues.

I will return to the whole issue of planetary limits on Report. With expressions of interest around the Committee, I think I will definitely return to the issue of roads on Report. In the meantime, I beg leave to withdraw my amendment.

Amendment 10 withdrawn.