Israeli Settlements: Trade Ban

Kit Malthouse Excerpts

Thursday 9th July 2026 Commons Chamber

[Kit Malthouse (North West Hampshire) (Con)]

It is a pleasure to follow the hon. Member for Glasgow West (Patricia Ferguson), and it is always a pleasure to hear the gentle Yorkshire accent of the hon. Member for Sheffield Central (Abtisam Mohamed) raised in fierce defence of peace, justice and international law.

Colleagues, let us make no mistake: while this country does need to rebuild its physical defences, in the end our defence lies in international law and the set of rules that we created after the second world war to decide how countries should peaceably settle their disputes. At the heart of the problem of international law at the moment sits the plight of the Palestinians, and if they sit at the heart of the problem, so do we. This debate is so important today because it is not just about the Palestinians; it is also about we Britons, the world we live in and the way we want the world to operate when it is in dispute.

As has been illustrated in the debate so far, nobody in this Chamber believes that the way the Palestinians have to live at the moment is acceptable. Nobody who has stood in the middle of Hebron and seen Palestinians living in cages or watched them being dragged from their homes, their olive trees uprooted, run over with cars and detained without charge; nobody who has seen the guns, the checkpoints, the walls, the UN signs saying where people can and cannot go or the enormous so-called settlements—that makes them seem somehow quaint, like “Little House on the Prairie”, but they are fortresses, forcibly invading and stealing other people’s land; and more recently, nobody who has watched these psychopathic settlers, though they are more like terrorists, roaming across the west bank, terrorising innocent Palestinian families on a daily basis and setting ablaze entire villages, can think that this is acceptable. Yet our country still sells them bulldozers, buys their goods and sells them financial services, and by those means, we financially support and help sustain this appalling situation, while hiding behind the fig leaf of complexity.

Therein lies a mystery that, I must confess, I have not been able to understand over the last couple of years. A third of the Labour party has put its name to a letter calling for a ban on trade with the settlements, yet the Government still do not move on this. Other countries across the world are instituting, or have instituted, bans. As the hon. Member for Sheffield Central said, the complexity argument falls away when we look at Crimea. A ban is not too complex for Spain, Ireland or other countries. Presumably, it was not too complicated for the civil servants who drafted the ban on trade with Crimea, or any of the other trade bans we have used, with effect, over the years.

As the Trade Minister will know, for other reasons to do with trade, we have insisted on the labelling of goods. We have even gently warned businesses off goods from settlements. We heard stentorian words in the last statement—“Take care in trading; there may be legal risk”—but the Government have done everything except the obvious, which is to just ban that trade. The question I am left asking is: why? Why the reluctance? Why the hesitation? Nobody is buying the complexity argument; we do not buy it in any other circumstance of trade. If we want to ban modern slavery, or goods produced by forced labour, we oblige businesses that are importing to prove that they have not acquired goods produced in that way.

[Clive Lewis (Norwich South) (Lab)]

I thank the right hon. Member for his speech. Maybe I can answer his question. Perhaps it is because of a nostalgia for an Israel that no longer exists—an Israel that made the desert bloom. We now have a state of Israel that routinely breaks human rights law, busts human law, and creates a situation in which it is accused of genocide before the ICJ. This is not a state that anyone in this House, let alone on the Labour Benches, should have any sympathy for, because it undermines our ability to hold up international law. When we think about it, the state that now exists is ultimately one that everyone in this House should be able to condemn wholeheartedly.

[Kit Malthouse]

Strangely enough, I agree with the hon. Gentleman. This is probably the first time in our political careers that we have agreed. He puts his finger on the point that I am trying to make. This dispute involves our own security. We do not have to be pro-Palestine or pro-Israel to take that view, just pro-British, which everybody in this House should be, first and foremost. That involves being pro-international law, pro-peace and pro-justice; the dispute goes to the heart of that. He put his finger on the point that I was coming to. Nobody is buying the idea that the argument is practical, Minister.

[The Minister for Trade (Chris Bryant)]

I have not made any argument!

[Kit Malthouse]

I know, but I ask the Minister not to patronise us all by standing up at the end of the debate and pretending that this is all too complicated, which I am afraid is what his ministerial colleagues have said to us before.

We know that the argument against a ban is not a legal one; that has been proven time and again. Indeed, we have supported resolutions at the UN and used our position on the Security Council to say that it is not a legal issue. I am left with the only other option, which is that the decision must be political with a capital “P”. I am afraid that is the most appalling thing to contemplate. Either we fear consequences from other countries, such as the United States or whoever it might be, or we believe it is in our national interest to recognise that Palestinian self-determination and Palestinian lives are disposable in the face of that political decision.

Even worse, it may be that we just do not care. It may be that at the higher echelons of political command, whether it is in No. 10 or the Foreign Office, they really just do not care. They think, “If we squint a bit, make some statements from the Front Bench and have a couple of sanctions here and there, in the end, the caravan will move on, and nobody will care.” I am afraid that until Ministers realise that this is not some kind of complicated chess game across the world, but a matter of our security, our interests and our morality, we will not make any progress.

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[Chris Bryant]

Yes, I have asked officials to produce advice on how we might proceed.

[Kit Malthouse]

By when?

[Chris Bryant]

The right hon. Gentleman asks, from a sedentary position, by when? I think my timeline may be rather limited in this post, but as Tagore said:

“The one who plants trees, knowing that he will never sit in their shade, has at least started to understand the meaning of life.”

I have been trying to progress some of this work. We have not got to a place where we are able to announce anything yet, but that is why I am saying we are actively considering it.

Draft Supply of Machinery (Safety) (Amendment etc.) and the EU Machinery Regulation (Enforcement etc. in Northern Ireland) Regulations 2026

Kit Malthouse Excerpts

Tuesday 30th June 2026 General Committees

[Kit Malthouse (North West Hampshire) (Con)]

I am grateful to be called, Ms Jardine. I do not want to detain the Committee too long, but I have some points of clarification for the Minister.

First, will the Minister confirm that the regulations concern the enforcement of machinery standards that flow into Northern Ireland by dint of the Windsor framework without any parliamentary scrutiny whatsoever in the UK, and that Northern Ireland will be forced to comply with the regulations without having any say in them whatsoever? On that note, did the UK Government have any beneficial influence over the EU production of the regulations, or will we just get what we are given? The Minister will understand that one doubt about the Windsor framework arrangement with Northern Ireland was the democratic deficit—the fact that we would be rule takers rather than rule makers—and this instrument looks like an example of that, so it would be great if the Minister could confirm that that is the case.

Secondly, will there now be much reverse engineering of wider GB machinery safety regulations to conform with what has been handed down to Northern Ireland? We obviously want to maintain the free flow of goods across the whole of the United Kingdom but, as I read it, in order for that to happen and for the convenience of business, UK businesses as a whole will have to conform to that which has been handed down to Northern Ireland by the EU. If we have had no say in that, it would be helpful to have the Minister’s assessment of whether the regulations are satisfactory for the whole of the United Kingdom or whether they increase the burden. I, too, was disappointed by the lack of any impact assessment in the explanatory memorandum to look into the wider domino effect on the whole of the United Kingdom. I would be grateful for the Minister’s view on that.

Thirdly, unless I have this wrong, it is implicit in the way the structure works that businesses in Northern Ireland will now have to comply with two labelling regimes. They will have the European CE labelling regime and a UKNI labelling regime. That is an added burden, particularly for smaller manufacturing businesses, yet we see no assessment of the impact in the explanatory memorandum. Has the Minister spoken to businesses about what dual labelling will represent? What inconvenience and cost will that put on small businesses?

Finally, as the Minister will know, the regulations include quite draconian penalties. What is the parliamentary accountability for the enforcement regime? We will be enforcing regulations that have been imposed on part of the United Kingdom without any democratic scrutiny. What will be the accountability mechanism for their operation and enforcement? I recognise that much of this comes out of the fact that we exited the European Union in a particular way, but it is, in microcosm, quite an interesting example of some of the conflicts that were highlighted to us during the Brexit process, which some of us attempted to solve.

My overall concern is that this change might be a crack in the door to required general UK alignment with EU regulations, which might not suit us overall and might put us at a disadvantage, not just for our internal market but for a wider market in the world more generally that looks to the British machinery-manufacturing industry with some hope of buying quality goods.

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[Sammy Wilson]

The standards applied to machinery made in Northern Ireland will be different from those applied in other parts of the United Kingdom. The hon. Member asks about the detail, but very often we do not know the cost until we actually have to apply the different standards. For example, in Northern Ireland we export a lot of agricultural machinery, and if the standards imposed by the EU require more work, more materials and more safety devices than those applied in the rest of the United Kingdom, there will be a cost.

We do not know until we actually see the standards applied and compare them with the rest of the United Kingdom. Because we export a lot of that machinery to GB, businesses could be at a competitive disadvantage due to the cost of enforcement. There is also the cost on councils.

[Kit Malthouse]

To be honest, the hon. Member for Edinburgh South West makes a good point. Presumably, he will vote in favour of enforcing the underlying regulations, but none of us know whether they are any good. In fact, we have had no say over whether they are any good—we just have to take them as handed down.

I asked the Minister earlier whether the UK, knowing that we have to accept them, whether we like it or not, has had any influence on trying to ensure that they actually do what they are supposed to do. To a certain extent, both sides of the House are blindly voting on the regulations, because we have had no hand in putting them together.

[Sammy Wilson]

Not only have we not had a hand in putting them together, but we have not even done an impact assessment, and we have not done an impact assessment because that is out of scope, as this is part of the Windsor framework. Of course, there is also the cost on local councils in Northern Ireland of implementing the regulations. I do not know what that will be, and I suspect that none of the councils have even been consulted on what additional staff will be required or what costs it will impose on them.

When we pass a piece of legislation, we should at least ask these questions. First, does it make one part of the United Kingdom different from another? It does, and the explanatory notes show that that is the case. Secondly, is it necessary? Given that the only necessity highlighted in the explanatory note is that we do not want to upset relations with the EU, I am not so sure that that is a justifiable reason for passing the legislation. Lastly, if we are passing legislation, surely we should know what impact it will have, and we do not know what impact this will have. For all those reasons I say to Members that before we carelessly vote in favour of this change, let us at least consider those points.

--- Later in debate ---

[Kate Dearden]

I thank right hon. and hon. Members for their consideration of the draft regulations and their contributions to the debate. They raised a significant number of issues that I will pick up on in my response.

First, on our product regulation legislation, since getting into Government we have legislated for the flexibility to ensure that product regulation, now and in future, is tailored to the needs of the UK. There will be some instances where we will take our own approach and some instances where we will want to take a similar approach to the EU. However, we have done that, and will continue to do that, on a case-by-case basis, where it is absolutely in the best interests of UK businesses and consumers and in our national interests.

The arrangements under the Windsor framework are a settled and important part of UK law, agreed by Parliament to protect the UK internal market. We have made the sovereign decision that is right for the whole of the UK to improve safety and modernise in particular machinery legislation, which we are discussing today, to reduce duplicative and costly burdens on businesses and ensure that there is no friction with the UK internal market. As I mentioned in my opening remarks, our approach is supported by the overwhelming majority of stakeholders.

This SI does not implement EU law in Great Britain; it does, however, continue CE recognition in Great Britain so that products that meet the new EU requirements can be placed on the GB market. That is not a new concept, but the continuation of current Government policy and the policy of prior Governments. The UK and the EU are strategic partners, and it is in our mutual interest to maintain trade flows and avoid trade friction, while responding to emerging technologies and maintaining a commitment to product safety and consumer protection. Mutual transparency and regular discussions are an indispensable part of that.

Informed by our engagement with industry, the Government have reviewed the changes introduced by the machinery regulation, and we believe that they are sensible and proportionate and will ensure that safer products are available to consumers and businesses alike. That is why we are continuing CE recognition and seeking to introduce similar measures in GB. As I have said before, we are prepared to align with EU regulation, but we will take a pragmatic, case-by-case approach, doing it where it clearly advances the national interests, supports long-term growth, promotes consumer interests, attracts investment and supports jobs. Where that is not the case, we will take a different approach to deliver the best outcomes for businesses and consumers in the UK.

At the centre of any long-term plans for the alignment between Great Britain and Northern Ireland, we will maintain the integrity of the UK internal market and Northern Ireland’s rightful place within it. My officials engage with the Northern Ireland Government and enforcement authorities on a regular basis to discuss any issues or concerns they might have, and that close relationship will remain ongoing. The right hon. Member for North West Hampshire mentioned Northern Ireland businesses and dual labelling, and I thank him for raising that. The answer is no: they can continue to CE mark only, and UKNI marking is optional if the conformity assessment is in the UK.

The shadow Minister, the hon. Member for West Worcestershire, and a number of Members on the Opposition Benches, mentioned the impact assessment for this SI. As she knows, a de minimis assessment has been prepared for the provisions of this instrument relating to continuing CE recognition in Great Britain. These measures are considered to have a low impact per business from their introduction, and that is additionally the case for the Northern Ireland aspects of this instrument. The measures resulting from the European Union (Withdrawal) Act 2018 are out of scope of the assessment. The Windsor framework is already given effect in legislation through the European Union (Withdrawal Agreement Act) 2020, which adds provisions and powers to the 2018 Act.

[Kit Malthouse]

I am finding it hard to understand how the Minister can claim that there will be no impact on businesses in Northern Ireland. To give a practical example, many production lines nowadays have built-in AI safety monitoring systems. At the moment, companies in manufacturing have to certify that AI against a national standard, and they can self-certify. As I understand it, the EU regulations around AI and cyber-security would mean moving to a notified body certification system. If I had a production line, I would have to go out and find a recognised body to come in and independently certify the software behind the safety system in my manufacturing line as compliant. That has to be an extra cost—how can going from self-certification to external certification by an outside body not have a significant impact? As far as I can see, these regulations are riddled with those kinds of changes, which must impose a significant cumulative burden.

[Kate Dearden]

The right hon. Gentleman rightly raises AI and cyber-security as part of our considerations. That is why it is so important that we keep up to date with technological developments and the impact on machinery. The EU’s machinery regulations, as he says, include provisions on software and AI to ensure that those new technologies do not affect the safe functioning of machinery. We are also working with the EU to ensure that the changes in Northern Ireland are compatible with wider product safety and regulatory reforms, including cross-cutting legislation on AI and cyber-security.

Overall, we expect the instrument to benefit Northern Ireland. We have extensively engaged with stakeholders in Northern Ireland, and SMEs in particular have indicated that it significantly helps in terms of resources—that is from our direct engagement with those businesses and the feedback we have received. It is a key consideration for businesses that they will be able to continue to benefit from dual access to both EU and UK markets. As we work towards introducing similar measures in Great Britain, continuing CE recognition and ensuring that the same machinery products can be placed on the market across the whole of the UK without unnecessary duplication of testing and administrative process will be absolutely vital.

The shadow Minister asked about the numbers of businesses involved. We estimate that around 230 businesses in Northern Ireland and 5,380 in Great Britain are in scope of the machinery legislation. She also referenced the £16.6 million of funding that I mentioned in my opening remarks. Funding was allocated in the Budget to deliver an enhanced “one-stop shop” advice service for small businesses beyond what is available on gov.uk, along with the new funding for Intertrade UK, and that commitment will be delivered in the course of the next financial year. The project has moved into a phase of more active engagement, with robust interest from stakeholders. Formal co-design workshops are ongoing to refine the service specification and ensure that the delivery model meets business needs.

I have briefly touched on the implementation of similar measures in Great Britain. My officials have already begun actively developing a further SI to modernise GB machinery regulation, which will ensure that the UK framework remains proportionate and aligned with the technological developments raised numerous times throughout this debate. Announcements about implementing similar measures have already been made, to provide businesses with the certainty that the shadow Minister also asked about.

The right hon. Member for North West Hampshire referenced enforcement and parliamentary scrutiny. The day-to-day enforcement of product safety legislation is largely local. For machinery in Northern Ireland, it would generally be undertaken by the Health and Safety Executive for Northern Ireland or by district councils, for workplace and consumer products respectively. However, the Secretary of State has enforcement powers under legislation, as the Office for Product Safety and Standards has an active enforcement role on behalf of the Secretary of State, particularly where issues are nationally significant, complex, novel, high risk or large scale. For example, the OPSS can intervene where a product risk affects consumers nationally or where co-ordinated enforcement action is needed across multiple agencies. I hope the right hon. Gentleman understands that enforcement will remain as it is under the current regime and that nothing will change; I hope that reassures him and answers his question.

When it comes to parliamentary scrutiny of CE recognition under the Product Regulation and Metrology Act 2025, we have consulted with stakeholders, and Northern Ireland provisions are done as part of the Windsor framework, which I touched on right at the start of my remarks. As the right hon. Gentleman knows, the parliamentary process uses the affirmative procedure.

To conclude, we are using the PRAM Act powers, as I have mentioned, for CE recognition, which requires consultation with stakeholders. UKNI marking will only be used by a UK notified body; otherwise, it will be a CE mark only. We have heard that from businesses in Northern Ireland through that stakeholder engagement, and that is what they have told us.

As explained previously, this draft instrument ensures the effective enforcement of the EU machinery regulation in Northern Ireland. It maintains access to the GB market for compliant products and supports high safety standards while minimising unnecessary burdens on business. This draft instrument also ensures our compliance with international law in relation to Northern Ireland’s continuing dual access. I am pleased to commend this draft instrument to the Committee.

Steel Trade Measure

Kit Malthouse Excerpts

Thursday 25th June 2026 Commons Chamber

[Chris Bryant]

I am grateful for my hon. Friend’s comments, and I know that he has raised some of those issues with the Secretary of State and the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Stockton North. It is probably best that we go through the granular detail of the particular company’s concerns.

Let me also correct the idea of there being an exemption. There is not an exemption; it is just that we are including some categories of steel in the trade measure and not including others. As the hon. Member for Boston and Skegness (Richard Tice) just said, nearly 75%—it is actually 74%—of steel imports are not covered by the trade measure at all.

[Kit Malthouse (North West Hampshire) (Con)]

I too am grateful to the Minister and his colleagues for the flexibility they have shown so far, and I will come and see him on Monday. First, could he be a little clearer about how dynamic he will be on quotas? At first look to me and the businesses in my constituency that are concerned, some of the quotas look a bit tight. If there was a sudden spike in prices following the imposition, can he move quickly and, if so, how quickly, because obviously decisions are made with a long-term view? Secondly, he said that without these quotas the UK would become a dumping ground for cheap steel. We may well now become a dumping ground for cheap fabricated products, so what will he do on fabricated products alongside this? Thirdly, this means that the Government will collect millions of pounds from British businesses importing steel that will still import above the quota. What will happen to that money?

[Chris Bryant]

The last question is a clever one—that is a matter for the Chancellor, however. On fabricated steel, the right hon. Member makes a good point, which I know several people made in the urgent question last week, or whenever it was—I was in Türkiye trying to negotiate a free trade agreement with it and, in fact, talking a bit about steel as well. It is a good point, and we will look at that. I do not want to overpromise on the idea that at the moment, if there is a fluctuation in prices that we as a Government will suddenly move in and change all the quotas, because predictability and continuity are often as important for business as anything else so they know the terms under which they are operating, so I do not want to overpromise. Our main point is that we will do a review after a year, and we will engage with everybody all the way through.

[Kit Malthouse]

So nothing will change.

[Chris Bryant]

The right hon. Member says from a sedentary position that nothing will change. I am just trying to moderate his expectations of change, but obviously, if there is a very significant, exceptional moment then we may need to act. The kind of thing I am talking about is speciality steel, for instance. When we started this process, we thought that it would be up and running again. It is not now, and that is one of the reasons that we have been able to change those categories’ quotas. But I do not want to give the expectation that the moment somebody experiences some concern that we will suddenly change, because in the end, as I say, there are difficult trade-offs here and we want to ensure that UK production of steel survives and grows.

Steel Tariffs

Kit Malthouse Excerpts

Wednesday 17th June 2026 Commons Chamber

[Chris McDonald]

Yes, I am concerned about that. As I have said, these measures are primarily about supporting the production of steel in the UK. I do not know if this is specific to the business mentioned by the hon. Gentleman, but many of the businesses we have heard about rely on supply from the EU, and that is where our discussions with the EU—linking discussions, essentially—are so critical.

[Kit Malthouse (North West Hampshire) (Con)]

While I am grateful for the Minister’s engagement, I think both he and the House are learning the dangerous domino effect that begins when we start mucking about with tariffs. I find it unbelievable that I am placed in the position, as somebody who believes in free trade, of urging him to consider consequential tariffs on the fabricated products with which businesses in my constituency are competing in a desperate attempt to hold on to at least domestic markets, given that international markets will evaporate. My question is this: he has said that he is going to review whatever emerges at the end of this process after 12 months, but the impact will be immediate, so could he please review it after one month?

[Chris McDonald]

The right hon. Member is quite right that there is a 12-month review. I thank him for his engagement, particularly with Stannah Stairlifts, but also for his further suggestions to me privately about how we might manage the transition. I want to reassure him that I am looking very carefully at the ideas he has raised.

To be clear about this, I think everyone in this House believes in free and fair trade, and we all wish we lived in a world where there were no tariffs. UK Steel has welcomed these measures, but has also said it would prefer it if there were not any tariffs. Unfortunately, this is the product of the world we are in. I do not think this is “mucking about with tariffs.” Essentially, we are responding to the global trading situation, and trying to ensure we have a strategy for a viable UK industry.

Oral Answers to Questions

Kit Malthouse Excerpts

Thursday 21st May 2026 Commons Chamber

[Chris McDonald]

I thank my hon. Friend for raising issues with businesses in Stourbridge when we met earlier this week; I am happy to continue to work with her. The measures we have introduced, which are primarily to protect the UK steel industry, are targeted at steels that are made or can be made in the UK. There are sometimes difficulties where a product code covers multiple steel grades, but that is what the quota system is intended to deal with, and of course there will be a review in 12 months’ time.

[Kit Malthouse (North West Hampshire) (Con)]

Further to the question from the hon. Member for Stourbridge (Cat Eccles) and my question to the Prime Minister yesterday, I am sure the Minister is aware that lots of manufacturing businesses are, frankly, screaming about the damage that the tariffs are going to do in five weeks’ time. Will he please consider an extension of the transition period to two years to allow three things to happen? First, it would allow UK steel capacity to grow in order to cover the gap. Secondly, it would allow quotas to be set correctly, so that UK businesses are not disadvantaged in the absence of UK production capacity. Thirdly, it would allow us to work out how it can be fair that somebody importing steel into the UK to produce a product pays tariffs, but somebody importing a finished product from overseas that is made from the self-same steel does not face tariffs.

[Chris McDonald]

I thank the right hon. Gentleman for his comments. I believe we have had representation from Stannah, the stairlift company based in his constituency. It is important to say that the Government take action like this reluctantly, but ultimately there are distortions in the market around steel. The EU taking action itself would lead to the UK becoming a dumping ground for cheap steel flooding in from overseas. We have taken a very carefully balanced approach and consulted carefully with the industry. I continue to receive representations, and, as I said, there is an opportunity for a review of the measures in 12 months’ time.

Steel Industry (Nationalisation) Bill

Kit Malthouse Excerpts

2nd reading
Thursday 21st May 2026 Commons Chamber

[Peter Kyle]

The work that my hon. Friend is doing is incredibly important to fulfilling the mission, and the possibility that the British steel sector has in the 2020s and going forward. That is the purpose of having a strategy where we invest and modernise, and then at times we need to protect as well. These are the things that we are doing to deliver a long-term, sustainable and global future for Britain’s steel industry.

[Kit Malthouse (North West Hampshire) (Con)]

I have two quick questions for the Secretary of State. First, if the Bill passes, how are the global competitors to British forged steel likely to react? Secondly, if our steel becomes more expensive than the global market norm, what choice will manufacturers in the UK be faced with about where to base their manufacturing?

[Peter Kyle]

I am not sure why the right hon. Gentleman would think that British steel would be more expensive as a result, but let us take one step back: if we did not protect, there would be no steel sector to export in the first place. That is why I took the decision to invest, to modernise and to protect where needed. If this Government had continued on the same trajectory that we inherited from the previous Government, I would fear for any steelworks at all being capable to export, let alone producing domestic supply as well. This is the future that we are now creating.

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[Kit Malthouse]

Does my hon. Friend agree that although the Bill appears to be an attempt at providing a simple solution for one industry, we need to be careful what we wish for? A huge amount of steel is used in the car industry—I do not know if Members have seen the number of Chinese cars appearing on our streets. If we have elevated and protected steel markets in the UK, at a time when we have a massive global oversupply of steel, we will not stand a chance of competing with the finished goods that use all that cheap oversupply. We will end up subsidising the car industry like we did back in the 1970s. That would have a particular impact in my constituency, where firms such as Stannah Stairlifts use steel in advanced manufacturing, and face having no choice but to consider offshoring their production.

[Andrew Griffith]

My right hon. Friend and my hon. Friend the Member for Meriden and Solihull East (Saqib Bhatti) have made exactly the right point: we need a more thoughtful approach.

I have written to the Secretary of State, as have many of my colleagues, asking that the tariffs are delayed for six months while the Department does more work; that the Government investigate more specialist grades of steel; that within the broader tariff buckets, they look again at the steel alloys used in the defence, aerospace and automotive sectors that are simply not made here today, because there are perhaps unintended consequences of the tariffs; that they be more forensic in their approach; and that they bring forward the measures the Conservatives have talked about on industrial energy costs, which are damaging not just the steel industry but many other industries’ and our basis on which to compete.

There is no point securing what the Secretary of State thinks is in the national interest for one steel manufacturer in a particular location if the foreseeable consequence, unintended or otherwise, is to ship offshore large parts of our high-end automotive manufacturing, engineering and defence industries, so that they are lost forever and conducted in other countries. I have raised that serious point with the Minister, and I ask him to address it.

Ground-mounted Solar Panels: Alternatives

Kit Malthouse Excerpts

Tuesday 14th April 2026 Westminster Hall

[Sarah Bool (South Northamptonshire) (Con)]

It is a pleasure to serve under your chairmanship, Mr Stringer. We are focusing on the concept of floating solar, which I am entirely behind. One of the drivers for that is the proposal in my constituency for the Green Hill solar farm, which will be enormous. It will be 1,200 hectares of agricultural land: the size—my hon. and gallant Friend the Member for Spelthorne (Lincoln Jopp) will like this reference—of Heathrow airport. It will be dispersed over nine sites, require 31 km of different cabling, and use up 65% of best and most versatile land. The Government say that food security is national security, but such a scheme flies in the face of that message. Even the national policy framework EN-1 says that we must minimise the impact on BMV, yet such a scheme is going before the Secretary of State in the next few months. I really hope that he considers that, because this is not the best way to be utilising our land.

Green Hill solar farm will also have a battery energy storage system, which will be installed right outside a village called Grendon. Grendon already has a 50 MW battery storage site, and another 50 have been approved by the Reform council—I am surprised about that, given its view on battery energy storage, but there we are. However, this solar farm will require a further 500 MW on top. That will be 600 MW of storage outside a beautiful country village. It is completely inappropriate for the size. The developers have probably cited the existing source as their reason. However, this addition will completely change the nature of the villages, and we still have not been able to get an answer to the question, if there is a fire and there is a risk of thermal runaway, what that will mean for the nearby villages? I have been told that they can simply evacuate a village; that is not practical, it is not pragmatic and it does not give our residents any confidence in the scheme that is going forward.

The beauty of floating solar, as my hon. Friend said, is that there will be no land use change, which is one of the most important parts of this. It is also important that there will be no evaporation of the water, which is excellent. One of the objections is the visual impact of solar. The national policy framework EN-1 says that we have to take account of the heritage of an area. This particular solar farm will be around a series of beautiful English countryside villages with rolling hills. The village of Easton Maudit will be surrounded by solar on three sides. That will completely change the nature and experience of the village. Indeed, Sir Christopher Yelverton, a former Speaker of the House—albeit from the 16th century —is buried in one of the fine churches there; I imagine that he would not be delighted by the prospect of this coming on board. There is an important relationship between maintaining the heritage of our areas and the environment that we are in.

[Kit Malthouse (North West Hampshire) (Con)]

My hon. Friend is exactly right, and I share her frustration. In my constituency, there is a large area of protected national landscape, the North Wessex downs national park, which is constantly under threat from these kinds of proposals. Does she share my frustration at the lack of imagination shown in the UK? The A303 and the A34 run through my constituency, and there are tens of miles of embankment that could be used for solar panels. That is the approach they take in Germany, the Netherlands and elsewhere, but we never seem to get over the imagination gap about where we could put these things—floating or whatever—that may not be quite so damaging and intrusive. She probably has parts of the M1 in her constituency, which has endless miles of embankment that could be used for solar panels that could power her constituency and mine without harming any visual amenity whatsoever.

[Sarah Bool]

I entirely agree, and we have been trying to promote that argument. It has unfortunately been claimed that Northamptonshire could become the warehousing capital of the UK, but we should be using the roadsides. We sometimes see airports using the side banks for solar panels. Solar panels should be installed on the covers of petrol stations and on the roofs of warehouses. I know that the last Government were consulting on whether more warehouse space could be used. I know that some people make technical arguments that the roofs are not strong enough and cannot be reinforced, but that is absolute nonsense. We can definitely work to ensure that the roofs are sturdy enough for solar panels.

There is debate about whether it should be the landlord or the tenant who bears the cost of the initial outlay, and about who gets the benefit. All those things are completely surmountable, and we should be able to work on a programme for that going forward. It all goes back to planning, because meaningful requirements could enable solar power generation. I am often concerned that these initiatives end up just being greenwashing and that we are only putting them in place to be able to tick a box. What we want to see is these schemes being meaningfully integrated.

Draft Contracts for Difference (Sustainable Industry Rewards and Contract Budget Notice Amendments) Regulations 2026

Kit Malthouse Excerpts

Tuesday 17th March 2026 General Committees

[Kit Malthouse (North West Hampshire) (Con)]

Notwithstanding the comments from my hon. Friend the Member for West Aberdeenshire and Kincardine, I am a little alarmed by this statutory instrument and its implications for my residents in North West Hampshire. I have a number of questions for the Minister.

My understanding is that this scheme was originally established in the aftermath of the disruption to supply chains caused by the conflict in Ukraine. There was significant concern about the ability of the offshore industry to continue, so the subsidy was put in place on a supposedly temporary basis. That was to allow for the uninterrupted development of an industry that had hitherto been working quite well, but was suffering at that point.

This statutory instrument, however, turns that temporary subsidy into a permanent feature of the landscape. We are voting through, colleagues, a permanent subsidy to the wind industry. [Interruption.] Well, there is no sunset clause; that has been taken out. There is no review mechanism—there is nothing. If the Minister wants to intervene on me, I am quite happy to be corrected, but as far as I can see this is an open-ended subsidy scheme through the CfD system. My questions are configured around that assumption.

First, could the Minister confirm that there will be no annual parliamentary vote on this subsidy? Normally, a subsidy to an industry would expect to come through direct expenditure from the Department for Energy Security and Net Zero, the Department for Business and Trade or whatever it might be. This is being funded through the supplier obligation levy, which is a direct levy on consumer bills. There is no approval by the House of the budget. In fact, I think it is just approved administratively—it is what it is. The consumer will pay, whether we like it or not. If the Minister could confirm that, that would be great.

As I understand it, the budget for AR7 was about £544 million. Could the Minister confirm for us the projected budget that the Government expect for AR8, and therefore how much my residents in North West Hampshire can expect to be added to their electricity bill to pay for this statutory instrument?

Much of the Government’s case for extending what is—let us be clear—an industrial subsidy is that there is a very high leverage. I looked at the maths, and the leverage of private sector to public sector is about 16:1. How was that number reached? I could not see in the impact assessment what the maths was, what assumptions had been made or whether this had been independently verified. Is there some kind of National Audit Office examination of that number? I have been a Minister myself, and I was always very sceptical about these public-private leverage numbers. They are often promoted by the industry looking for the subsidy, and make their way into these sorts of impact assessments without any kind of checking. I would be grateful to understand what the assumptions were.

Could the Minister also confirm that this is now a permanent feature of the landscape—that there is no sunset, statutory timeline, let or control? People will effectively just bid through the CfD system, the subsidy will make up the difference, they get to build their onshore, floating offshore or whatever wind it might be, and my constituents and I have to pay no matter what.

Then I wanted to ask a bit about this fair work charter. I understand that the Government are very keen on employees’ rights. We should all make sure that people are treated with respect in employment, but using a statutory instrument effectively to extend employment regulations seems very odd. I wonder whether that will be an ongoing feature of the landscape for statutory instruments such as this and whether we can expect a kind of extension of regulation by stealth.

I am sure these regulations are perfectly amenable, but their being contemplated in a small Committee of Members, rather than on the Floor of the House, as the Employment Rights Act 2025 was, or indeed going through both Houses in all their pomp, seems to me a slightly sneaky way to get around proper Government scrutiny. I would be very interested if the Minister could point me, please, to the specific statutory authority that permits the use of CfD contracts to impose employment standards on developers and their supply chains. If he cannot point me to that, what is the legal authority, please, for that being included in this statutory instrument?

Finally, CfDs were designed originally to bring down the cost of alternatives. That was the original plan. Yet what we are voting on today will do precisely the reverse: raise the cost for me and my constituents. I wonder how the Minister can justify that at a time of difficulty for so many of our constituents with the cost of living. If this industry is as attractive to the private sector as he says it is, why does it need the subsidy in the first place?

[Michael Shanks]

I will address a few things. There were some contradictory comments from different Members of the same party: on the one hand, we should support the supply chains, but on the other, the Government should do nothing to actually build them up. I will come to that point, because—

[Kit Malthouse]

We think for ourselves.

[Michael Shanks]

That is how we end up with absolutely no industry left in the country. That is what we are trying to rebuild after 14 years of it falling apart.

I will turn to the specific points. First of all, the shadow Minister, the hon. Member for West Aberdeenshire and Kincardine, made a good point about the strength of supply chains in the north-east of Scotland; I will be in Aberdeen again on Thursday. One of the key things that the North Sea Future Board has taken as a real priority is how we map those supply chains, not just over oil and gas but over what could come in terms of offshore wind, decommissioning, hydrogen and carbon capture. For too long, the pipeline of future projects that that supply chain could be redeployed on has not been clear enough. As a result, we have been losing out on contracts that could be dealt with here in the UK. We are determined to try to fix that, because there are significant supply-chain opportunities, but we need to make it easier for companies to take those up.

The shadow Minister and I always agree on new nuclear, although we slightly disagree on how much he achieved when he was the Nuclear Minister—but I will not mention that, because I want us to work co-operatively on nuclear. New nuclear is incredibly important. As he is right to say, the supply-chain benefits in the UK from nuclear are substantial: thousands and thousands of jobs in communities right across the country, not just in proximity to Sizewell or Hinkley, are contributing in different ways to building what are phenomenal engineering projects here in the UK.

The small modular reactor fleet that the Government not only consulted on but have actually delivered—and are delivering—will result in even more supply-chain jobs across the country as well. The shadow Minister and I also agree that we would like to see some of those SMR projects being built in Scotland, with even closer supply chains in Scotland as well, but we first need to change the Scottish Government in May; I am glad that he will be supporting a vote for Scottish Labour on 7 May to do that.

The shadow Minister also raised a number of other points about the supply chain that I think are right. It is absolutely right to say that floating offshore wind is an expensive technology, but we are at the cutting edge of its development. We have a real opportunity to do something differently on deep-sea wind, which we were not able to do on fixed-bottom wind, to have the supply chain here in the UK. We have the biggest pipeline anywhere in the world; we have one of the biggest projects in the world. That is an opportunity for us to deliver on that innovative supply chain, but it takes investment for that to happen.

The right hon. Member for North West Hampshire asked a number of genuine questions, which I appreciated. First, the regulations themselves very clearly set out the sunset clause as 31 December 2028. This will be eligible for the allocation rounds before that date; if we wanted to continue the scheme beyond that, we would have to come and update these regulations again, but it is not an unlimited fund.

On the projected budget for AR8, I cannot get into projected budgets because they are driven by the initial allocation that is set, and then by the bids that come in. In AR7, we reformed the process so that we could see the bid stack in order to see what projects were in that option round, although they were anonymised. That resulted in the budget getting us the output of offshore wind that we did, at a price that was 40% cheaper than new-build gas. That is what we should hold on to: the AR7 option round was cheaper for consumers than the equivalent would be.

I remind right hon. and hon. Members that there is no option to not build new energy infrastructure in this country. We have two choices: we either double down on gas, and the world as it stands right now is a reminder of why that would be a mistake; or we build renewables. There is no option to build nothing. There is a cost for consumers, regardless of what we choose to do. There is also a huge cost for consumers of building the grid that the previous Government failed to build for 14 years, which we are now determined to do.

On the fair work charter, there is no compulsion on any developers to bid into the clean industry bonus. If they want to participate in the contracts for difference auction, they are very welcome to do that. If they want to participate in the clean industry bonus and have public support for supply chains here in the UK, then they should conform to the requirements of that scheme. We think it is absolutely fair to say that if the hard-working people of this country are putting money into building those factories, fair work should be at the heart of it. I am surprised, frankly, that in 2026 anyone would think that fair work is something that we should not support by any means necessary.

[Kit Malthouse]

As I think I said, I agree that people should be treated with respect; my question was more about why it is being done through this particular route. For the Government to legally have grounds to include what we are discussing as part of, effectively, a procurement process, there has to be a statutory basis on which they are doing that; it cannot just be shoved through on a non-universal basis. I was asking for the authority on which it is included.

I am sorry if I misread the time limits regulation. Could the Minister confirm that, if the Government give notice before 31 December 2028 for 12, 15, 19 or 120 more rounds to come, they will then be able to continue post that deadline? So they can in fact manufacture a deadline.

Finally—rather than my having to intervene again; I hope you will bear with me, Ms Jardine—could the Minister confirm to colleagues what he said: we are being asked to vote today for higher energy bills for our constituents in perpetuity, or certainly for the next few years, as a result of this instrument? Just so everyone is clear: you are voting for higher bills.

[Michael Shanks]

I thank the right hon. Member for his second speech in the debate.

--- Later in debate ---

[Kit Malthouse]

I was trying to save time; I can intervene more if the Minister wants.

[Michael Shanks]

I understand the point. First of all, I have been really clear. This regulation, as it clearly sets out, comes to an end on 31 December 2028. We will come back to the Committee to update the regulations should we wish to continue the scheme. We have run AR7—it was a successful scheme. Obviously, we want to monitor what happens in AR8 and AR9. We may be able to devise other schemes. It may be that by then that our industrial strategy has delivered the supply-chain benefits across the UK and that that is not necessary, but supply chains do not come out of nowhere.

The shadow Minister, the hon. Member for West Aberdeenshire and Kincardine, made one other point that I wanted to come back to. When we left Government, two supply chain companies were building solar in this country. When we took back Government in 2024, there were none. If we want to have supply chains in the UK, we have to support and invest in them. That is not just a cost. It also delivers good jobs across the country, and our energy security.

On the question about raising bills, the right hon. Member for North West Hampshire is quite wrong. The outcome of building the clean power system is that we will bring down bills, but we have to be able to build it and that means supply chains here in the UK as well, because the rest of the world is also in a race to build clean energy infrastructure.

[Kit Malthouse]

So is that a yes about voting for higher bills?

[Michael Shanks]

It is a no, because the counterfactual, of relying on gas, as his party is so determined to do, would put up everyone’s bills significantly. We are the ones bringing down bills, and on 1 April all our constituents will see that the decisions this Government have made will reduce their bills by 7%.

There are a number of points in this statutory instrument that I could go over again; in the interests of everyone’s time, I will not. I reinforce the point that we believe that if we are building an energy system for the future here, we should deliver the good jobs and industrial benefits that come with that. That should not be a controversial argument, but it seems that it still is. If we want to have an industrial strategy, we cannot be agnostic, sit on the sidelines and hope that someone else will do it—we have to drive it forward. If we want our constituents to have good, well paid jobs across the country, helping build the energy system, we have to do something about it. This Government are doing that, and I commend the regulations to the Committee.

[Kit Malthouse]

On a point of order, Ms Jardine. I do not mean to be difficult, but the Minister has not answered all the questions I posed—not least about the assumptions of the 16:1 leverage, which is apparently the big bonus coming in. I also do not know whether it is appropriate for us to vote on what is effectively an open-ended budget. Fundamentally, the impact I am most worried about is the one on my constituents—that I am not going to be able to tell them how much this will cost them; that is quite a significant hole in the Government’s argument. I am not aware of other statutory instruments where we vote for an open-ended budgetary allocation that our constituents will have to pay for, whether they like it or not.

I have time this afternoon. If you, Ms Jardine, want to suspend the sitting while the Minister goes and finds the answers to those questions, I am quite happy for that to happen. It seems to me disrespectful for us to rattle through something that will have an impact quite soon on people’s electricity bills.

[The Chair]

Thank you. That is not a matter for the Chair but the right hon. Member’s comments are on the record, and I have taken note of them. It is appropriate now for us to move on.

Question put.

UK Modern Industrial Strategy

Kit Malthouse Excerpts

Monday 23rd June 2025 Commons Chamber

[Jonathan Reynolds]

I very much welcome the question and the work that my hon. Friend has done. He has been an ally in ensuring that there are no problems around the defence sector being seen as a legitimate source of business investment and economic activity. We recognise why we need that in the national interest, but we should not in any way be squeamish about the contribution that defence makes because the deterrence value is a fundamental contribution to peace, as well as to economic security.

I can tell my hon. Friend that the strategy commits us to double the amount of the defence budget that goes specifically to SMEs, rising to £2.5 billion a year. SMEs, in diversifying the defence supply chain and creating those opportunities, are absolutely a part of this strategy, and if he has any red tape to show me that we need to get rid of, let’s work together to get rid of it.

[Kit Malthouse (North West Hampshire) (Con)]

I draw attention to my entry in the Register of Members’ Financial Interests. This is the sixth industrial strategy announced from that Dispatch Box since “New Industry, New Jobs” by Gordon Brown in 2009. While they have all been filled with a box of chocolates selected by the Secretary of State, with his or her preference often underpinned by a huge subsidy, not a single one of them has made any significant difference to the UK’s growth rate, and that is because they all miss a particular piece of the jigsaw. I urge the Secretary of State to recognise that the Government can build as many roads and bridges as they want, train as many young people as they like, pump as much money into the British Business Bank as they want, but unless they can find individuals to take a risk with their own capital, they will not get any investment. Unless these individuals can see a return on that capital, they will not invest. I urge him, as we move towards a Budget in November, to work with the Chancellor of the Exchequer to increase entrepreneurs’ relief, cut capital gains tax, and reduce the taxation on dividends so investors can see a return on their risk.

[Jonathan Reynolds]

I hesitate to say this, but I think the right hon. Gentleman underestimates the number of strategies there have been in recent years. It is certainly more than six; we are at 11 in the past decade, or something like that. There have been six Business Secretaries in five years, which is certainly far too many. I think we can all agree that we need some long-term consistency in that area alone.

I agree with the right hon. Gentleman’s point on risk. That is one of the more thoughtful contributions I have heard on the low economic growth, mainly under a Conservative Government, since the financial crisis. We have to consider that attitude to risk in terms of regulation. Maybe our role as parliamentarians, when we ask regulators to fix every problem and stop every bad thing happening, is to ask ourselves whether that is the right balance, whether that is a reasonable request, or should it be—of course, with that in mind—proportionate to the performance of the economy.

The right hon. Gentleman mentions some specific measures. We have the lowest corporation tax in the G7 and a competitive tax rate overall, but we are always seeking to improve that. We need supply side tools, fiscal changes and a consistent long-term environment. That is what we seek to put in place.

Budget Resolutions

Kit Malthouse Excerpts

Wednesday 6th November 2024 Commons Chamber

[The Secretary of State for Business and Trade (Jonathan Reynolds)]

It is a pleasure to open this final day of the debate on the Chancellor’s growth Budget. Can I welcome the new shadow team? It is lovely to see them in place. I think many of us on this side would admit that we were shadow Ministers for longer than we ideally would have been, and I know that it is a tough and thankless job at times. On a personal level, I wish them well for the future.

As the Chancellor rightly stated, growth is our only path to prosperity, to increasing living standards and to delivering the change that the British people voted for so decisively over the summer, and we on these Benches recognise that we cannot have growth without investment. Growth demands investment in our infrastructure, into our public services, into the cities and regions that have gone overlooked and under-invested in by past Administrations, and that is what this Budget chooses. It chooses investment over decline, with more than £100 billion of public investment into our roads and our railways, our parks and our playgrounds, our schools and our surgeries—all the things upon which a successful economy and a healthy society depend.

This was a Budget for affordable homes, for the NHS, for the school rebuilding programme and—a personal priority for me as MP for Stalybridge and Hyde—for the trans-Pennine route upgrade, including a new station at Mossley, which is something I am sure the whole House can be excited about and get behind. This is literally rebuilding Britain in action, and make no mistake, businesses need that public investment too, because it creates the right environment for them to thrive now and long into the future. That is why the Office for Budget Responsibility says that our increases in spending will drive up the long-term increase in GDP by up to 1.4%.

[Kit Malthouse (North West Hampshire) (Con)]

The Secretary of State makes much of growth. Of course we all want growth, but the OBR report actually says that growth in real GDP will start to slow over the next three years and that in years four and five of the Parliament it will go negative. It is telling us that the Government’s Budget is actually going to result in a smaller private sector, not a larger one. How is he going to explain that to business?