Space Industry (Indemnities) Bill

Jerome Mayhew Excerpts

Friday 4th July 2025 Commons Chamber

[Jerome Mayhew (Broadland and Fakenham) (Con)]

It is a great pleasure to speak again on the Bill. It is a short Bill—it replaces just two words—but one with substantial implications. The meat of the Bill, if I can call it that, is to replace “may” with “must”.

I will briefly refer to some of the excellent contributions. I am relieved to have heard many fewer revolting puns than in previous debates on this subject; nevertheless, a couple slipped through. I start with the sponsor of the Bill, the hon. Member for Glasgow East (John Grady), who set out the commercial need for the change to the Act. He made the sensible point that Government policy is easier to change than statute. If we were not sure of that before this week, one should just ask the Prime Minister and the Chancellor of the Exchequer to understand that it is easier to change policy than it is to change legislation.

My hon. Friend the Member for Wyre Forest (Mark Garnier) is the chair of the all-party parliamentary group for space, which makes him eminently well-qualified to speak in this debate. I was pondering my own qualifications, and the best I could come up with was that I played rugby for a team called the Space Cadets when I was at university. That is about as close as I could get to the space industry. My hon. Friend rightly made the case for a role for the City of London. He mentioned developing opportunities for Lloyds of London, listings, bond issuance and subsequent legal support. The hon. Member for Portsmouth North (Amanda Martin) highlighted the role of Portsmouth and the wider Hampshire space cluster. She said that it was just four words that needed to be changed—in that sentence, she doubled the size of the Bill.

The hon. Member for Northampton South (Mike Reader) reflected on space developments in the context of defence, and on commercial opportunities being held back because of regulatory uncertainty. He was right to highlight that regulatory certainty matters. Finally, the hon. Member for Crawley (Peter Lamb) said he was the grandson of the father of British space science, which presumably makes him the son of British space science.

We cannot complain about inadequate consideration of the Bill. The first attempt to enact the change was introduced by the former Member for Woking, Jonathan Lord, and we had a Second Reading of a very similarly worded Bill on 23 February 2024. Unfortunately, that Bill was lost in the parliamentary wash-up session, as a result of the general election being called later that year. I am pleased that the incoming Government have, through their inspirational Back Benchers, been able to introduce a private Member’s Bill in very similar terms.

Second Reading was quite a long time ago—back on 7 March this year—but since then, the Bill has been through Committee and undergone robust line-by-line consideration. I am pleased to report to the House that the word “must” has not been altered in Committee. I wonder whether “definitely should” or “really ought” was posited by Members, but, in the end, we have the same wording as on Second Reading. We now come to the remaining stages, no doubt to an enormous sigh of relief from the industry, and perhaps a little bit of frustration about why it has taken so long to change just two words in an Act that received Royal Assent back in 2018.

As a personal observation, I question whether the private Member’s Bill route is appropriate for legislation that has such significant commercial impact. The industry has been waiting. We have heard from speaker after speaker about the commercial importance of changing “may” to “must”, and yet it has taken seven years from identifying the original problem to effecting a solution. We need to really think about that, because this Bill is important and delay has had a cost.

The UK space industry generates £18.9 billion for our economy. There are at least 1,800 businesses involved in it, some 52,000 jobs are directly employed by the space industry and, with the supply chain, that number increases to 130,000. No doubt, those figures are out of date as it is a growing industry. We have strong demand for UK commercial spaceflight that led to the original regulatory benefit, arising out of our Brexit freedoms, to have a dynamic regulatory environment. It has given us a genuine economic commercial advantage over our European friends and neighbours, because we have been able to have a more dynamic approach to regulation.

However, that has been put at risk because of the difficulties in calculating potential liabilities. Others have already gone through the legal niceties of the Space Industry Act 2018, so I do not propose to go through those line by line as I would normally. Suffice it to say, the legal duty of a space operator is to provide insurance for their operations, and that is required under the Act. That brings a corollary obligation to make a calculation to potential exposure. If someone is making an actuarial calculation of the risk to which a client is exposing an insurer, they need to undertake a calculation of the scale—the quantum—of that risk.

This is where the regulatory uncertainty has played its part. Although it has been repeated in this Chamber and elsewhere that it is, and remains, Government policy to have an indemnity beyond a certain level of liability, the uncertainty is that the legislation does not require the Government to do that. Section 12(2) gives the Civil Aviation Authority—the regulatory authority in this case—power to set an upper limit to provide clarity. This Bill turns that power into an obligation, which is quite right.

We have had a fun debate and I am very pleased that the legislation is nearing the end of its legislative journey, but we collectively need to stop and think. This is an uncontroversial change, with cross-party support, supporting a growth industry, and yet it has taken five months to progress from Second Reading to the remaining stages. That is simply not good enough. We collectively need to think of a way in which we can get this kind of legislation accelerated.

Launches into space are never straightforward, and this Bill is no exception. It had an initial flare-out on its launchpad before the last general election, and since then it has had an excruciatingly slow reconstruction and review. But it is finally ready for launch, and I wish it well. I hope it releases many further launches across the United Kingdom.