Oral Answers to Questions

David Mowat Excerpts

Thursday 10th April 2014 Commons Chamber

[Vince Cable]

The Office for Budget Responsibility forecast for 2014 is that business investment will rise by 8%. Given the depth of the crisis to which we have had to respond, this is a slow process, but business investment is now overtaking consumer spending as the driver of the recovery.

[David Mowat (Warrington South) (Con)]

16. What steps he is taking to support energy-intensive industries.

[The Secretary of State for Business, Innovation and Skills (Vince Cable)]

The Government have in place several measures to address energy costs for these industries. The Budget announced a further £7 billion package of support including: extending the existing compensation scheme to 2020, under which we have distributed £30 million to 53 companies; new compensation for costs of the renewables obligation and feed-in tariff; qualified exemptions to the carbon price support mechanism for combined heat and power; and capping the CPS at £18 per tonne of carbon.

[David Mowat]

The Secretary of State will be aware that even after the welcome changes in the Budget, the carbon price floor in the UK is four to five times higher than in the rest of the EU, where the emissions trading scheme is more or less defunct. In addition, the EU has a system of more direct subsidy in countries such as Germany for these industries. Can he assure the House that he will be active in ensuring that our industries are supported in the same way as those in the EU are, and that the 900,000 jobs in energy-intensive industries are protected?

[Vince Cable]

Indeed, it is a major industry. My figures suggest that we have some 600,000 jobs directly or indirectly affected. It is a massive industry. We believe in it, and it is important that it is able to compete on a level playing field. That was the purpose of the changes announced in the Budget and we are now actively pursuing state aid clearance to make sure that these compensation mechanisms go through.