Community Funding (Infrastructure Projects)

Thérèse Coffey Excerpts

Tuesday 18th September 2012 Commons Chamber

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

The invitation is, of course, extended not only to Somerset, but to Suffolk, where, I hope, Sizewell C will be built at some point. I thank my hon. Friend the Minister for his eloquent description of the restricted uses of section 106 agreements and how community benefit money might be used in a wider context to ensure that all the community benefits, not solely those in a very narrow tunnel, so to speak.

[Mr Hayes]

I shall deal with both those points. First, of course, I look forward to discussions with my hon. Friend about her local circumstances. Indeed, last evening over coffee, we had a brief initial discussion on that very subject. Secondly, she will know that section 106 agreements are locally negotiated. I hear what she says about the breadth of their effect, which I am prepared to discuss further with her and with my hon. Friend the Member for Bridgwater and West Somerset.

Aside from section 106 agreements, however, which mitigate and compensate the impacts, there are a number of ways in which the community will directly and indirectly benefit from hosting a new power station, such as increased long-term employment and increased spending in the local economy. However, there is also the issue, raised by my hon. Friend, of business rates retention. I am pleased to reassure him that business rates from new nuclear sites will be treated in the same way as growth from other sectors. Therefore, increases in a local authority’s business rates that arise from a new nuclear plant will be retained by the local authority in accordance with the principles set out in the Government’s proposals for business rates retention. It is likely that that will amount to a significant increase in funding for local authorities over the first 10 years of operation.

I do not believe that section 106 agreements are sufficient in themselves to provide a full basis for community benefit; nor do I believe that retaining business rates for 10 years is an adequate reflection of the recognition that a local community deserves for the long time scales involved in its operation. That, of course, affects our judgment on these matters, as my hon. Friend pointed out.

More importantly, section 106 agreements do not address the need to create sustainable economic growth for the long term or look for ways to make the area attractive to other investors and the wider public, which is precisely the argument made by my hon. Friend the Member for Suffolk Coastal (Dr Coffey).

The national infrastructure plan, published in 2011, committed the Government to

“engage with developers and local authorities on community benefit and bring forward proposals by 2012 for reform of the community benefit regime to provide greater certainty for all parties”.

My hon. Friend the Member for Bridgwater and West Somerset said that he was getting twitchy about this. I do not want him to get twitchy, as it would be a most unappealing prospect, so I commit—sooner rather than later, in the terms that he used—to clarify our position on this matter.

Now that I am on this task—missioned to do this job—I can assure my hon. Friend that I will draw the matter into sharp focus, and we will indeed deal with it in the short term. My officials have been working on a number of ways, including business rates retention, in which a community benefit package could be delivered. The principles of such a package are, it seems to me, very clear: meaningful action on behalf of the community; spending decided by the community; fair and equitable practice across all sites—indeed, we have the representatives of two affected communities here this evening—and the intergenerational impacts, which we have referred to.

The broad principle behind the provision of both section 106 agreements and a community benefit package is that this should be directed by the local community to projects that can help to resolve both community and individual impacts that arise from the proposed development, but which cannot be included in a section 106 agreement because they are not judged essential for the project to go ahead. That rather more permissive view of community benefit must lie at the heart of any changes that we make, in line with my hon. Friend’s apposite call for the matter to be dealt with speedily.

The focus should therefore be on planning and investing for the time post-construction to enable long-term sustainable growth through redeployment of labour and creating new business opportunities once the main construction phase is completed. Doing so would help to ease the transition between the sizeable influx of employees, the fluctuation of employment during the lengthy construction period and the more stable and sustained employment associated with the operational phase of the plant. That would enable local businesses better to plan for the future and to provide more certainty for the longer term. It could also allow other infrastructure projects to go ahead, to provide additional long-term jobs for the area, better transport, community facilities and so on.

That brings me to a very important feature of a community benefit package: the right of local communities, principally, to be empowered to determine how to transform themselves, in line with the principles of localism. Localism is dear to my heart. As you know, Mr Speaker, I am an admirer of Joseph Chamberlain, who, of course, framed his career in Birmingham long before he came to this place and became a figure of such national importance. In those days, energy was in the hands of local authorities—a fact rarely mentioned in the House and sometimes forgotten. They not only had responsibility for energy, but gauged the effects of investment in resources on their locales. The sense of ownership that I described was implicit in those arrangements. It is important that we borrow from those days the principle that local communities must feel a profound sense of ownership of major projects. They must never feel that the projects have been imposed on them, regardless of their will or their interests. An imposition of that kind will not happen under this Government; I give the House that absolute assurance.

In Somerset, my Department has constituted a Hinkley strategic development forum, comprising representatives from central Government Departments, the local authorities, the local enterprise partnership, the local chamber of commerce and EDF, to maximise local benefits from the development. Such forums would be a suitable vehicle to help steer plans for the allocation of community benefit. Indeed, we feel that all district councils are working constructively to ensure that the whole area benefits from the development of Hinkley Point C. We are clear that any package needs to be meaningful to the local community and to provide some of the things that I mentioned earlier.

This debate adds further weight to the case for a package that is entirely suitable, well fitted and decided locally, as far as that is possible for a project of this size and national importance. Fairness and equity need to be managed as part of these discussions to ensure that the principles apply not only to each new nuclear site, but to other large infrastructure projects, such as geological disposal facilities.

In conclusion, as my hon. Friend correctly points out, discussions have been ongoing for some time on putting together proposals for a community benefits package that meets all the criteria of being meaningful, making a difference, managing to achieve a sustainable local economy and having a lasting impact for generations, and we are on track to bring forward those proposals by the end of the year; I have this evening already committed to doing that.

I am, however, sympathetic to the points that my hon. Friend raises, and I recognise that ongoing uncertainty for the local community is simply not helpful. I will therefore personally drive forward these negotiations across the Government. I will look to meet the Economic Secretary to the Treasury in the near future to discuss the issue and other important matters of the kind raised by my hon. Friend, relating to investments. We must plan our energy future on the basis of the sort of engagement that he has articulated so powerfully in this short debate. We should be in a position to provide clarity on all these matters sooner rather than later, to use his terms, and so can give the residents of his constituency and others the certainty that they need.

In these matters, clarity is the prerequisite of certainty, and certainty is the prerequisite of the kind of engagement and support that is absolutely necessary if we are to drive forward an energy strategy that has nuclear power at its heart. There has not been an Energy Minister with a greater insight into these things than mine, for I draw experience from a long apprenticeship in local government. I hope that I can bring that insight to our deliberations on this matter and others. I look forward with excitement to further meetings with my hon. Friend and to my visit to Somerset, and I do so very much in the spirit in which he brought these matters to the House tonight. If that is not sufficiently electrifying, regard it as a first step; I will attempt to be still more electrifying as I grow into this role.

Question put and agreed to.