Zero Emission Vehicle Mandate

Debate between Heidi Alexander and Gareth Bacon

Monday 7th April 2025 Commons Chamber

[Gareth Bacon]

I thank the Secretary of State—[Interruption.] That was a very helpful intervention by the hon. Gentleman; he is completely right. I thank the Secretary of State for her statement, and for advance sight of it. The announcement by the United States of America that 25% tariffs will be imposed on UK automotive exports has understandably caused significant concern in the automotive sector. Automotive manufacturers now face tariffs of 25% on around £8 billion-worth of car and auto parts exports—a potentially devastating blow for the automotive industry. I assure the Secretary of State that we will support the Government when they do sensible things to reverse the impact on our already fragile economy. In that vein, I am glad that the Government have recommitted to negotiating a better deal with our closest ally and largest single-country trading partner, and I sincerely hope that they are successful in their negotiations.

However, on the substance of the right hon. Lady’s statement, I cannot share her enthusiasm for the rest of Labour’s plans. The reality is that today, Labour is simply trying to clear up the uncertainty that it has contributed to. When the previous Conservative Government reacted to sluggish automotive trade figures by making the pragmatic decision to delay the ban on new diesel and petrol cars from 2030 to 2035, aligning the UK with major global economies such as France, Germany, Sweden and Canada, Labour accused us of undermining the automotive industry. This morning, the Secretary of State criticised the previous Government for chopping and changing, and a consultation put out by Labour claimed that our policies caused “great harm” to the UK’s reputation as a leading nation in the EV transition by moving the goalposts. However, that is precisely what Labour did upon taking office by ideologically reversing the 2035 deadline. The plans announced over the weekend do not place the automotive sector in a better position than it was when we left office, despite some minor adjustments to the zero emission vehicle mandate.

What is more, this announcement will not undo the damage that this Labour Government have already caused. Their introduction of a £25 billion national insurance jobs tax in their first Budget was a major blow to businesses; we have warned for months that this tax will harm industries, and the automotive sector is no exception. The Secretary of State will know that US tariffs on UK car exports are set to cost the automotive sector £1.9 billion. Combined with the Government’s jobs tax—which is predicted by the Office for Budget Responsibility to put 50,000 jobs at risk, and is likely to cost the automotive sector an additional £200 million—that double whammy is going to be very difficult for the sector to absorb.

Indeed, despite today’s announcements, the Society of Motor Manufacturers and Traders has stated that zero emission vehicle mandate targets remain “incredibly challenging”. In its words:

“ZEV Mandate targets are incredibly challenging, especially with a paucity of consumer demand and geopolitical upheaval. Growing EV demand to the levels needed still requires equally bold fiscal incentives…to give motorists full confidence to switch”,

but that is not what the Government are offering. Instead of the “bold changes” that the Prime Minister boasted of at the weekend, what we have is mere tinkering at the edges. Allowing producers of luxury vehicles, such as Aston Martin and McLaren, to be exempt from the 2030 ban on the sale on new internal combustion engine vehicles is welcome, as is the news that all forms of hybrid cars will be available until 2035. However, this does not go anything like far enough. The Government are still proposing to increase the level of tax liability on the value of hybrid company cars by as much as 16%, which could potentially cost individual drivers thousands of pounds each. The reduction in fines for missing EV sales targets from £15,000 to £12,000 per vehicle is nothing to be celebrated—it is like drowning at the depth of 100 metres instead of 120 metres.

Over the past few months, we have heard from numerous businesses that they simply cannot cope with the ZEV mandate. In October, the chief executive officer of Jaguar Land Rover warned that the mandate was causing severe disruption to the new car market. Not long after, Vauxhall announced the closure of its Luton factory, citing the ZEV mandate as a key factor in making that plant economically unviable. More recently, uncertainty has surrounded Plant Oxford, the home of the Mini since 1959. Last year, excluding fleet sales, the fact is that only 10% of private purchases of new vehicles were electric. Far from doing retailers a favour, the Government’s offer to fine them a small amount less for failing to sell a product that consumers demonstrably do not want is a kick in the teeth to the automotive industry.

I must therefore ask the Secretary of State the following questions. With just one in 10 private buyers purchasing an electric vehicle in 2024, why are the Government still trying to force people to buy something for which there is limited consumer demand at present? Is she really pretending that any of the measures announced today were not already in train before the tariffs were announced? Will she commit to reversing the hike in the hybrid company car tax? Does she really think that reducing the fine for each car that fails to comply with EV quotas will be enough to mitigate the impact of tariffs? Does she not believe that, rather than chasing an arbitrary timeline, now is the time for a more gradual transition to electric vehicles, one that would allow the sector to mitigate many of the challenges it is currently facing? Finally, does she recognise that the combined impact of the ZEV mandate, the jobs tax and external tariffs is a perfect storm for the automotive sector, which is facing significant and exacerbated challenges because of the choices her party has made over the past nine months?

[Heidi Alexander]

I also extend my birthday wishes to the shadow Secretary of State. I hope he is grateful for the two birthday presents I have given him: not only a statement but a general debate, so that we can face each other across the Dispatch Box not once but twice today.

It is rich for the shadow Secretary of State to blame uncertainty in the automotive sector on this Government. I can only think that he has some sort of selective amnesia going on, because it was his Government who introduced this policy. They then delayed the phase-out date, tanking EV demand by 15% almost overnight. We had the spectacle of the previous Prime Minister, the right hon. Member for Richmond and Northallerton (Rishi Sunak) standing up to make a speech pushing that date back out to 2035. Almost overnight, we saw those sales tank. The shadow Secretary of State should be explaining to Britain’s car manufacturers why his party faffed about so much, costing them millions and arguably leaving the sector less resilient to the global economic headwinds it now faces.

The shadow Secretary of State claims that this is a moment when we are tinkering at the edges, but nothing could be further from the truth. This is a significant moment for industry. He quotes the SMMT, and I just gently say to him that Mike Hawes, its chief executive, said this morning:

“The government has rightly listened to industry, responded quickly to global dynamics and recognised the intense pressure manufacturers are under.”

The shadow Secretary of State is also right to raise Jaguar Land Rover, which is affected by the imposition of the global tariffs that President Trump announced recently. I point out to the hon. Gentleman that Adrian Mardell, CEO at JLR said:

“We welcomed our announcement of the increased flexibilities in the zero emission vehicle mandate, and the clear commitment from Government to incentivise electric vehicle uptake and invest in infrastructure.”

The shadow Secretary of State also said that consumers do not want to buy electric vehicles. He needs to do his homework; the UK is the third largest market for electric vehicles in the world, after the US and China. It is the largest market in Europe. Last year—[Interruption.] He can chunter as much as he wants. Last year, 382,000 EVs were sold. We have had record figures in February and March this year, where we have seen demand for EVs go up by more than 40% compared with the same month in the previous year.

The shadow Secretary of State claims that we were going to make this announcement anyway. Well, he is right that we have been talking to industry for a number of months, and we were always going to have to do something to clear up the dog’s breakfast of a policy left by his Government. Clearly, the announcement last week about US tariffs on the car industry has made it all the more important that we act with pace and urgency. It is completely right that we have provided the certainty and clarity for which the sector has been calling for years.

The shadow Secretary of State claims we are not going far enough. We are investing £2 billion in an automotive transformation fund, which will ensure we can build the battery gigafactories of the future, support the EV supply chain and ensure that those high-skilled jobs of the future are available in communities across the country. Between now and 2030, we are spending £200 million supporting the roll-out of charge points, backed by £6 billion of private investment. We are spending £120 million on plug-in vehicle grants, giving people who want to purchase a new van up to £2,500 and those wanting to purchase a larger van up to £5,000.

I say to the shadow Secretary of State that this Government are acting where his Government failed. We are giving certainty to businesses, protecting jobs in a critical industry, cutting carbon and fostering a competitive market to benefit consumers.

Oral Answers to Questions

Debate between Heidi Alexander and Gareth Bacon

Thursday 27th March 2025 Commons Chamber

[Mr Speaker]

I call the shadow Secretary of State.

[Gareth Bacon (Orpington) (Con)]

When the Government handed the ASLEF trade union an eye-watering £9 billion pay agreement in the summer, they promised that it would

“protect passengers from further national strikes”.

Yet recently the Secretary of State said on national television that

“there will be occasions on which strikes will be necessary”.

Will she provide the House with an example of a necessary strike?

[Heidi Alexander]

The hon. Gentleman will know that I have extensive experience from my time in London, where we did take strikes when safety was at risk. That is one direct example that I can give him.

[Gareth Bacon]

The Secretary of State will be aware that in response to her Department’s recent rail consultation, the trade unions welcomed her plan and said that a just transition to nationalisation would mean the levelling up of pay and conditions for rail workers. The cost of that to the taxpayer could be considerable. Would she consider a strike over harmonising pay and conditions to be a necessary strike?

Disruption at Heathrow

Debate between Heidi Alexander and Gareth Bacon

Monday 24th March 2025 Commons Chamber

[Gareth Bacon (Orpington) (Con)]

I thank the Secretary of State for her statement and for advance sight of it. I join her in extending my gratitude to the firefighters who responded so swiftly to the incident. I extend my sympathies to everybody affected by the disruption and place on record my thanks to all those at Heathrow who worked diligently to ensure that the airport came back on line over the weekend.

The loss of power in the Heathrow area caused significant disruption for thousands of travellers and countless businesses. Heathrow is one of the world’s busiest airports and Europe’s busiest air hub. It was scheduled to handle 1,351 flights, carrying up to 291,000 passengers on Friday. However, as we know, the fire at a nearby electrical substation forced planes to be diverted to other airports, with many long-haul flights returning to their points of departure. The financial cost of the shutdown to the airline industry is expected to total tens of millions of pounds, and there are significant question marks over the airport’s possible vulnerability to further disruption in the future.

Before we discuss the specifics of the incident, I ask the Secretary of State to confirm that she will remain engaged with Heathrow, the airlines and other key stakeholders throughout this period to minimise the impact on passengers and the economy.

I note that the Secretary of State for Energy Security and Net Zero, whom I am pleased to see in his place, has instructed NESO to investigate the incident urgently. It is crucial that NESO’s investigation delivers a clear and objective assessment of the incident’s circumstances and the UK’s broader energy resilience. I ask the Government to keep the House informed as that investigation develops.

I also note that the Secretary of State for Transport will closely monitor Heathrow’s internal investigation into the incident. She is right to do so. Although I trust that she will share any conclusions drawn from the report with the House, may I ask that she provides specific assurance today that she will indeed do so?

Let me focus on the details of the incident, which evidently raises significant concerns about the resilience of Heathrow airport and critical infrastructure in general. On Heathrow’s resilience, important questions arise about why the airport was dependent on a single electrical substation, which proved so vulnerable to such an incident. I understand from media reports and from the Secretary of State’s statement that although two additional substations are capable of powering the airport, doing so would require reconfiguring the power supply structure for all terminals. Does the Secretary of State believe that that set-up is appropriate for the country’s largest airport? Additionally, what assessment has she made of the power supply resilience of other major UK airports?

With regard to the resilience of our critical national infrastructure, the episode underlines the urgent need to ensure that our critical infrastructure is safeguarded against both accidental incidents and deliberate acts of sabotage by malign actors. Hon. Members will recall that when President Putin launched his illegal invasion of Ukraine, global energy markets faced immense disruption, which posed the most significant threat to European energy security since the 1970s. Despite that upheaval, Britain’s energy prices remained broadly stable, but only because the Government of the day took decisive action to protect businesses and households from price spikes as far as possible. That came at a significant financial cost.

The event at Heathrow reminds us that true energy security depends not only on price stability but on the physical safety of our energy infrastructure. Given the crucial role of airports in our economy, we must remain vigilant. In the light of that, what discussions has the Secretary of State had with the Secretary of State for Energy Security and Net Zero about ensuring that the energy supply to major airports remains secure? What is the timeline for the Kelly review, and will its findings be made publicly available? Will the Secretary of State engage with colleagues across Government Departments to assess and mitigate the risks posed by malicious actors who will undoubtedly have taken note of this weekend’s events? Finally, what specific steps will she take to strengthen the resilience of our critical national infrastructure?

[Heidi Alexander]

I am grateful to the hon. Gentleman for the tone of his comments. I assure him and other Members of this House that I will do everything I can to keep them updated, and I will continue the engagement I have had with Heathrow since the incident first became known to me. I spoke to the chief executive of Heathrow on Friday morning and again today. If my officials can do anything to assist those on the Opposition Front Bench in understanding this very serious issue, I am willing to facilitate any such meetings that the hon. Gentleman wishes to have.

On the internal investigation that the London Heathrow board has commissioned Ruth Kelly to do, as the hon. Gentleman knows, I have asked to see a copy of that report. Assuming that I have the permission of Heathrow to share it more broadly, I am happy to share its contents with him and the House. On his question about whether I am content with and confident about the set-up for airport power supplies, I am not going to become an armchair electrical engineer; I want to see the report that has been commissioned by the airport and the report that my right hon. Friend the Secretary of State for Energy has commissioned from NESO. We are also conducting a resilience review of critical national infrastructure via the Cabinet Office, and I assure the hon. Gentleman that we will look at any and all the issues that this incident raises in those reviews. I spoke with my right hon. Friend the Secretary of State for Energy on Friday evening, and I assure the hon. Gentleman that I will continue to engage across Government on any of the issues that this incident raises.

Oral Answers to Questions

Debate between Heidi Alexander and Gareth Bacon

Thursday 9th January 2025 Commons Chamber

[Gareth Bacon (Orpington) (Con)]

I was appalled to discover this morning that I have known the Secretary of State for the thick end of two decades. We have had various exchanges in various other fora, but this is our first exchange across the Dispatch Box in this House. I therefore warmly congratulate her on her appointment and welcome her to her place.

The Government promised to deliver more reliable rail services, but over Christmas, what did we see? Chaos, cancellation and delays. The train drivers, having accepted the Government’s no-strings pay deal, chose to turn down overtime shifts, leaving passengers stranded and left in the cold. The Government’s no-strings agreement was supposed to bring stability to the railways, but it did the exact opposite, causing major disruption. Will the Secretary of State admit that the pay deal that they thought would improve reliability in fact only made services worse?

[Heidi Alexander]

I am grateful to the hon. Gentleman for his kind words. I remember those days on the London Councils transport and environment committee. I hope he does not mind my saying that both he and I have a little bit more grey hair since then, which is not necessarily helped by this new job.

On the substance of the hon. Gentleman’s question, I must vehemently disagree with him. The reality is that this Government acted when the previous one refused to do so, to put an end to the industrial action that was blighting our railways. We had a two-year national rail strike that ground down everyone who travelled or worked on the railways, at a cost of £850 million in lost revenue. He might take a lesson from the former Conservative Rail Minister, the former Member for Bexhill and Battle—

--- Later in debate ---

[Mr Speaker]

Order. I say to the Secretary of State gently that I had wanted to welcome her today, but I have to get through a lot of Members. We are on topicals, which are short and punchy. I call the shadow Secretary of State to give us a good example.

[Gareth Bacon]

I note the Secretary of State’s answer, but, in the real world, we know that the Government’s union paymasters will keep pushing for more. Labour’s plans to scrap the minimum service levels will give the unions more power to hold the railways hostage. Does the Secretary of State accept that the Christmas chaos will not be a one-off, and will in fact be the start of an ongoing decline in reliability?

[Heidi Alexander]

We have had decades of chaos on the railways, and railways that simply did not work for people. What is needed is a fundamental reset with the trade unions to deliver improvements for passenger services.