British Steel: EU Emissions Trading Compliance

Debate between Greg Clark and John Redwood

Wednesday 1st May 2019 Commons Chamber

[Greg Clark]

Well, history is important in this because one of the reasons why our electricity prices have been high compared with others is that in the last five years of the previous Labour Government, industrial electricity prices rose by 64%. What we have done since then is provide £291 million in compensation for energy-intensive sectors, to correct some of the inflation that took place during that time.

As the hon. Lady knows and has acknowledged, my firm view is that in a world where manufacturing in this country and its opportunities around the world are undergoing a revival, there is absolutely no reason whatever why British Steel should not make a major contribution to that, right across the country. I am keen that we should conclude a sector deal with the steel sector. There have been important discussions. All sector deals require co-investment from the Government and the companies. No one is keener than I am to conclude one: as I hope is evident from my statement today, I am prepared to act in support of a sector that is important—not just for the economy, but for the towns across the country in whose lives it plays such a prominent role.

[John Redwood (Wokingham) (Con)]

If the Government had kept their word and taken us out on 29 March without the withdrawal agreement but tabled a comprehensive free trade agreement, we would not be in this mess. What are the Government going to do to have a proper industrial strategy, which can work only if there are more adequate supplies of much cheaper power?

[Greg Clark]

What my right hon. Friend has said is not the case. Our legal obligations for 2018 would be there, and the company would have to comply. Had we left without a deal, the company would be in the position that it is in.

When it comes to the competitiveness of the UK steel sector, it is clear that the markets are international and, especially in the case of British Steel, very substantially across the continent of Europe. It has been very clear that we need to make sure that we continue to trade on terms at least as favourable as we do at the moment with the European Union, which is why both British Steel as a company and the steel sector have been absolutely clear, in terms, that we need to ratify an agreement such as has been proposed, and we need to do it very quickly.

Leaving the EU: Protection for Workers

Debate between Greg Clark and John Redwood

Wednesday 6th March 2019 Commons Chamber

[Greg Clark]

I warmly welcome the tone in which the hon. Lady has approached this issue. We have different preferences on what would be ideal, and I know that both the TUC and her own Front-Bench colleagues would prefer EU directives automatically to take their place in UK law and to be enforced through the European Court of Justice, as they are now. She knows that we disagree with her on that—in our view, it would not be consistent with leaving the European Union or with the sovereignty of this Parliament—but I accept that that is her position and that she has said that, notwithstanding that, we should explore whether we can meet her perfectly reasonable observations. I am grateful for that.

What we are publishing this afternoon are draft clauses that have not yet gone into the Bill. I am open to working with all Members of the House—of course, continuing to include the hon. Lady—to see which of the observations can be accommodated, subject to the general approach we wish to take. I think that she recognises, and I hope other Members will recognise, that this is an important opportunity. If we are to pass a withdrawal agreement and implementation Bill, the chance to have on the statute book from the outset—literally within the next few weeks, I hope—some important protections for workers is one that I think we should all take.

The hon. Lady asked some specific questions, of which I shall attempt to answer as many as I can. She observed, in effect, that future Governments and Parliaments may take a different view from that which we intend. As we know, it is a fact that no Parliament can bind its successor, but it can express a clear intention, set up a test and provide mechanisms against which proper scrutiny of any proposal can be mounted, and that is what we are doing. I acknowledge her right hon. and hon. Friends’ contribution to and, in fact, origination of this idea.

The hon. Lady is concerned that the statements that are provided for could be ignored and may not be as effective as she intends. The case law clearly establishes that if a statutory consultation is provided for, it cannot be lightly swept aside. There is a requirement properly to engage with the recommendations that come from such a consultation, but I hear what she said about that process being open to workers as well as to people who might represent them. We can talk more about that.

The hon. Lady asked about the application to future changes to workers’ rights that may come outside primary legislation. Clearly, the big changes come through primary legislation, but in the spirit of what I said earlier, I am certainly open to exploring what assurances we can give on other significant pieces of legislation that might be in scope.

The hon. Lady mentioned the jurisprudence of the ECJ. It would clearly be inappropriate after Brexit for the ECJ to have a remit in the UK, but of course, as she knows as a lawyer herself, any court can have regard to the decisions of any court that it considers to be relevant in the case being considered.

The hon. Lady mentioned enforcement, on which we strongly agree. There are industries—sometimes concentrated in particular places in the country—in which what she described is correct: a calculation is made that employers who abuse the rights of their workers are unlikely to be detected and enforced against, which leads them to think that they can get away with it with impunity. The intention behind the strengthened enforcement body that I described, and our intention in terms of resourcing it, is to firmly remove that idea from the mind of any such employer. I will work closely with the hon. Lady on that.

It is appropriate to recognise in the House and draw some pride from our record of employment rights. We have a successful labour market that combines a reputation for high standards—standards that have been recognised throughout the EU as being among the best in Europe—while having what is the most important right for workers, which is the right to work. Many more people in this country are able to work as a result of the effectiveness of our labour markets. We need to preserve that while giving expression to the objectives articulated by the hon. Lady’s colleagues, to make sure that the commitment we have given to build on that strength in future is something that is not just a matter of words but has parliamentary force behind it. I am grateful for what the hon. Lady said about working together.

[John Redwood (Wokingham) (Con)]

I am assured that the Government and this Secretary of State want high standards of employment rules in this country, and I look forward to our having independence so that we can have our own domestically crafted high standards, which will be above the minimum EU standards, but will the Secretary of State please explain why he has proceeded with this statement? I thought its sole aim was to win over the Labour party, but it seems Labour is in complete disagreement with it.

[Greg Clark]

I was very much influenced by the exchange between my right hon. Friend and the hon. Member for Bassetlaw (John Mann) when the latter spoke to his amendment in January. As I recall, my right hon. Friend correctly intervened on the hon. Gentleman to reinforce his personal commitment to establishing and maintaining Britain as a place of voluntarily high standards. Because that represents a point of agreement in the House and is a reflection of our traditions—our reputation is as place of high standards, thanks to the accretion of steps taken by Governments of both parties—I think this is an opportunity to work together to see whether we can establish something that is rooted in the sovereignty of this House, which my right hon. Friend quite rightly insists on, but also provides assurance to those who want to see measures as well as words.

Nissan in Sunderland

Debate between Greg Clark and John Redwood

Monday 4th February 2019 Commons Chamber

[Greg Clark]

First, let me remind the hon. Gentleman that a greater amount of financial investment is going into Sunderland than was anticipated in 2016; this is a long-term commitment that has been made by the firm. He should welcome that and reflect that the future jobs of those employed in Sunderland have been secured by that investment in the Qashqai. That is a welcome factor.

The hon. Gentleman is right to point out that the company has expressed an urgent concern that we should resolve the question of Brexit, but he is wrong to say that the deal the Prime Minister has negotiated does not command the positive confidence of the industry. I have talked about Nissan, but let me mention the head of Ford in Europe, who said:

“It’s important that we get the agreement ratified that’s on the table at the moment”.

The chief executive of Aston Martin has said that it is “obvious” that the deal that we see

“meets the needs of all the requests we put forward as an industry and as Aston Martin.”

Toyota has said that it welcomes the announced deal, which

“would provide business with the certainty of a transition period and help avoid the significant production disruption a ‘No Deal’ outcome would have for ‘Just in Time’ supply chains in the automotive industry.”

I share the hon. Gentleman’s view that we should bring the uncertainty to an end, but the only way to do that is by backing a deal, and I commend to him the deal that has the support of every one of the employers in the automotive sector that I have quoted to him today.

[John Redwood (Wokingham) (Con)]

The big increase in vehicle excise duties, the squeeze on new car loans, and the general tax and regulatory attack on new low-emission diesels has had a predictable effect, in greatly reducing the demand for and sales of new diesel cars in the UK. Will the Government reconsider these damaging policies, given the strong bias in our industry to produce those Euro 6 diesels?

[Greg Clark]

I say to my right hon. Friend that, in fact, the extra investment is going into new Powertrains—cleaner Powertrains. Far from being critics of this, Nissan, as people who know the industry well know, is among the principal advocates for more ambitious environmental standards and has been a pioneer in establishing electric vehicles in this country. It is recognising that that is the way consumer demand is going, but it recognises that this is a positive step.

European Union (Withdrawal) Act

Debate between Greg Clark and John Redwood

Thursday 10th January 2019 Commons Chamber

[Greg Clark]

I will come on to describe and respond to some of the contributions that have been made. It is very important to consider the constructive contributions that many Members have made, which can, in the days ahead before the vote, be reflected in the decision that is taken on Tuesday.

In that regard, let me start by mentioning the contribution of the right hon. Member for Don Valley (Caroline Flint). She was right to say that we should be proud of the record of this House over many centuries in establishing a defence of and a commitment to the rights of workers. That gives us cause to be proud around the world, certainly in Europe. We should be determined to continue that tradition. It is fair to reflect that this has involved Governments led by her party and Governments led by my party. The Labour party introduced the minimum wage and the Conservative party introduced the national living wage. Going back to previous generations in Parliament in different centuries, this House has always taken an active view in these matters. The amendment that she and her hon. Friends have tabled is entirely in accordance with that. Far from, as my right hon. Friend the Member for Newbury (Richard Benyon) put it, involving a ceding of those decisions to the European Union, what is attractive about the contribution that has been made is that it firmly gives to this House the opportunity to make a sovereign decision on how we want to act on the opportunities that might exist to constantly upgrade and strengthen workers’ rights. That should be something that is open to us.

The hon. Member for Bassetlaw (John Mann) made a powerful speech and a notable contribution. He said that the time for rhetoric had gone and that the time for negotiation had come. I think that that is a way in which we can proceed and his contribution was consistent with that. He was determined to avoid no deal by accident, which a majority do not want. Again, he reflected on the fact that the Trade Bill, as well as the motion before the House, will give very significant power to this Parliament to shape the ongoing relationships we have with other countries. He made references to the importance of exercising the authority of this House to ensure that all parts of the country, including those whose communities have not felt advantaged by our membership of the European Union and the conduct of the economy over decades past, are heard and recognised as they deserve to be. I will come on to say something more about his amendment in a second.

In the same spirit, my right hon. Friend the Member for Newbury very powerfully made the point that compromise is a virtue and something to be prized in this House. He also made the point that the mandate for compromise reflected in the narrowness of the result—even though it clearly indicated the preference of the population to leave—should be reflected in our deliberations.

The right hon. Member for Knowsley (Mr Howarth) emphasised the important point about our proximity to our trading partners in Europe and reflected on the fact that if we want to engage in good and close trading the relationships, as all Members do, it makes sense to think very clearly about how we can do that with those who are geographically closest to us.

My right hon. Friend the Member for Wokingham (John Redwood), who has over many years given much thought to these matters, nevertheless set out a case that I could not agree with. I hope that I do not mischaracterise his contribution, but he asserted that we should be aiming for greater national self-sufficiency in certain of our trading relationships. He mentioned foodstuffs. I am a proud Kent MP—some of the produce of Kent, as my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst) will attest, is among the best in the world—but to aim for a model of national self-sufficiency while failing to recognise, as David Ricardo did all those centuries ago, the benefits to all if we concentrate and specialise is not something that we should embrace.

My hon. Friend the Member for Cheltenham (Alex Chalk) reflected on the economic benefits of the deal and how they would benefit his constituency. The hon. Member for Salford and Eccles talked about business having a gun to its head. Not at all! Many businesses and business organisations campaigned for remain during the referendum and yet have recognised that what the Prime Minister has negotiated is a settlement that would allow them, and therefore our constituents, to continue to prosper.

[John Redwood]

As the Secretary of State is in love with free trade and Ricardo, would he agree with my proposal to remove all tariffs from imported components for manufactures to give our manufacturing a boost?

[Greg Clark]

My preference is to be part of the arrangements that we benefit from now in terms of our manufacturing industry, but as a general proposition I believe that we should be engaged in reducing tariffs. Part of our contribution to the EU has been that we have been probably the foremost advocate in Europe for the reduction of tariffs. That would be a good thing.

Nuclear Power: Toshiba

Debate between Greg Clark and John Redwood

Monday 12th November 2018 Commons Chamber

[Greg Clark]

I am grateful for the comments from the Chair of the Business, Energy and Industrial Strategy Committee. She will know that it is only very recently that it has been possible to invest in new nuclear. The Labour Government she supported had no future new nuclear build programme. She will know from her visits to Sellafield and other nuclear installations that we are taking forward the recommendations of the Public Accounts Committee, including at Wylfa in north Wales, to look, where we do have a counterparty with which we can negotiate, at new financial models, and it is right that we should do so. However, as the hon. Lady would expect, that depends on being able to demonstrate value for money for bill payers and taxpayers.

[John Redwood (Wokingham) (Con)]

How likely is it that the Secretary of State will find an alternative developer for a nuclear project in Cumbria? If we do not, how will we generate the power we are missing?

[Greg Clark]

We have a substantial pipeline of new energy projects, as a number of hon. Members have made clear. When it comes to the Moorside site in Cumbria, it was always available to developers to leave it. It will now revert to the Nuclear Decommissioning Authority. It will be open to developers to come forward to make proposals. However, whether with nuclear or other sources of clean power, we have a substantial pipeline of new projects coming forward to add to our energy supplies.

Leaving the EU: Airbus Risk Assessment

Debate between Greg Clark and John Redwood

Monday 25th June 2018 Commons Chamber

[John Redwood (Wokingham) (Con)]

Does not Boeing’s decision to make a major manufacturing investment in this country show that a complex supply chain can be run with a lot coming in from outside the EU perfectly well and give the lie to the idea that we will not be able to supply the wings to Airbus?

[Greg Clark]

I want Britain to be the best place in the world to produce advanced manufacturing products, and that means we should be tenacious in looking at every way to make the supply chain competitive. Given that our parts go backwards and forwards between the UK and the continent, if we can avoid frictions, as I am certain we can, that enhances our ability to compete, which is to the advantage of Boeing as well as any other company in the industry.

Energy Policy

Debate between Greg Clark and John Redwood

Monday 25th June 2018 Commons Chamber

[Greg Clark]

The hon. Gentleman represents a country that has prospered from the development of the offshore wind industry. The truth is that if a decision had been taken to subsidise this proposal, that money would have come out of the budget for offshore wind, which would have led to job losses in Scotland and elsewhere around the United Kingdom. He mentions a proposed subsidy. The truth is that if a project that is not viable is subsidised by the taxpayer, it is simply a taxpayer-subsidised unviable project. That is no basis on which a project can be approved.

The hon. Gentleman refers to the nuclear power programme. If he regards the price agreed for the power from Hinkley Point C as too high, that is all the more reason for him to oppose this proposal, because it is so much costlier. He must accept that there is a responsibility for the use of consumers’ and taxpayers’ money that comes with being in office. When a proposal is so out of kilter with what can offer value for money, the necessary decision must be made, and he should respect that.

[John Redwood (Wokingham) (Con)]

I accept that, on the Secretary of State’s figures, this would be a very bad investment, but can he tell us about the amortisation period of the investment? Surely a barrage will last a lot longer than, say, a wind farm. Will he explain why his advisers think that the project would generate so little power on a not very reliable basis, given the reliability of the tides?

[Greg Clark]

My right hon. Friend is correct to point to the amortisation. As someone who has spent a career in finance, he is aware that in discounting the value of earnings in future generations, the great majority of the value is in the earlier years, and that has been the standard basis of the assessment made. What has not been taken into account is the prospective decommissioning cost of the proposed lagoon, which has been estimated at £1 billion. That has not been included in the analysis, but it would be a further liability for the taxpayer.

Nuclear Power

Debate between Greg Clark and John Redwood

Monday 4th June 2018 Commons Chamber

[Greg Clark]

I am disappointed that the hon. Lady did not continue in the spirit in which she opened her contribution. This is an important moment, and we are beginning a negotiation on a project that will supply energy to this country for the next 60 years, until towards the end of the century, which will create jobs and reduce our carbon emissions. She said that her party supported the proposal and that there was cross-party consensus—one could be forgiven for missing that in her tone—and it is important to establish that, because it is evident that any 60-year project will take place over the life of successive Governments. This country has given nuclear investors confidence over time that there is a strong commitment to such major infrastructure projects, so I hope that she will back the commitments that she and her party made in their manifesto last year to support new nuclear and recognise the considerable opportunities, as she put it, for nuclear power internationally and domestically.

The hon. Lady asked about the financing model. She urged me in a letter to reflect on the recommendations of the National Audit Office and the Public Accounts Committee to explore alternative financing models that can reduce the price of the electricity that is generated. That is exactly what I have set out—I have followed the recommendations of the NAO and the PAC. We are entering a negotiation—I think somewhere in her remarks there was a welcome for that—but the essence of doing so is that a deal has not been agreed. We need to explore that, and it is subject to the very tests that she set out and that the NAO and the PAC observed are required, including on value for money.

On safety, the hon. Lady should be reassured—there are many hon. Members who are familiar with the nuclear industry in this country—that the safety standards operated through our independent nuclear inspectorate are the highest in the world, and that the generic design assessment is the most exacting in the world. We always abide by the rulings and requirements of the independent regulators so that we can have full confidence in the safety of this important industry.

Finally, the hon. Lady mentioned other potential investments, including the proposal for renewable power in Swansea. She knows—we have had exchanges about it across the Dispatch Boxes—that I believe in a diversity of energy supply, but we need to make sure that value for money is offered for taxpayers and bill payers. A rigorous assessment is required and, as I have done today, I will update the House when the process is concluded.

[John Redwood (Wokingham) (Con)]

How will the Government ensure, if they have a stake in the proposed investment, that when it comes to buying power they are fair between that investment and other people in the market?

Domestic Gas and Electricity (Tariff Cap) Bill

Debate between Greg Clark and John Redwood

2nd reading: House of Commons
Tuesday 6th March 2018 Commons Chamber

[Greg Clark]

It is true that Ofgem has said that it might be challenged in the courts. I do not think we should be afraid of testing arguments in the courts, and I would have preferred to see that happen. The statute that the right hon. Lady mentions would not enable the gap to be closed in a way that would allow competition to continue in the other part of the market—other Members have raised that matter. It would require a closing of the gap, but that could take place by means of the deletion of other tariffs, which is not what we want.

[John Redwood (Wokingham) (Con)]

I fully support the effort to lower energy prices, and competitive markets should be able to do that. Last week we were very short of both gas and electricity. There seems to be a capacity problem, and we are going to close a load of coal power stations. What action is being taken to expand capacity to increase the chance of competitive prices?

[Greg Clark]

The capacity auction arrangements that have been pursued over the last few years have been very successful. We have had a higher margin this winter than last, and the prices of securing that capacity for future years have fallen in successive auctions. My right hon. Friend is right to raise the question, but the framework is actually delivering more resilience than has been delivered in the past.

Nuclear Safeguards Bill

Debate between Greg Clark and John Redwood

2nd reading: House of Commons
Monday 16th October 2017 Commons Chamber

[Greg Clark]

Let me say two things. First, we want to see maximum continuity of the standards—we do not want any reduction in them, as they have served us well and they give confidence to the industry. Secondly, the hon. Gentleman knows, from his many years in this House, that successive Governments have taken forward our long-term disposal of nuclear waste, and work on a long-term repository is being conducted, but that is a domestic responsibility, as it always has been.

[John Redwood (Wokingham) (Con)]

I welcome the Secretary of State’s approach. Will he confirm it will mean that all the operational work that happens in the relevant plants will continue as if nothing had changed? It is done to a high standard and we wish to preserve those standards.

[Greg Clark]

My right hon. Friend is absolutely right. As I say, I do not think anyone regards the arrangements that have prevailed as deficient, so it makes sense to replicate them as we can. We are being orderly in making sure that we have the right domestic framework in place in good time.

Energy Price Cap

Debate between Greg Clark and John Redwood

Monday 3rd July 2017 Commons Chamber

[Greg Clark]

The hon. Gentleman talks about energy strategy, and it is right that the Government have taken a decision—this was ducked by previous Governments for decades—to renew our nuclear power stations that are coming to the end of their lives. He will know that the SNP Government in Scotland agreed to extend the lives of nuclear power stations there, and he will also know about the impact of our success on renewable energy, specifically offshore wind, in Scotland. I have had fruitful discussions with colleagues throughout Scotland, especially in the remote islands, about the future possibilities for that.

On Ofgem’s response to my letter, I have set out clearly that it has said it will work with and consult consumer groups, and come up with a range of options. The £1.4 billion detriment has to be eradicated, and that is the test of whether the proposals are acceptable. I am sure that the House wants to scrutinise them as much as I do.

[John Redwood (Wokingham) (Con)]

My right hon. Friend inherited a system that relies increasingly on dear energy, which drives up household bills. Is there anything that he can do to bring a greater amount of cheaper energy into the mix so that bills reduce in five or 10 years’ time?

[Greg Clark]

My right hon. Friend makes an excellent point. We need to ensure that we meet our important climate change commitments at a competitive cost—for consumers and for businesses—and that we obtain the industrial benefits from having a supply chain in this country. That is exactly why we devote a chapter of the industrial strategy Green Paper to future plans to make the most of the clean energy transition in all respects.