It is a pleasure to serve under your chairmanship, Dr McCrea. This debate is important to my constituency and to the constituencies that neighbour mine on the River Tyne. The issues that I intend to raise have far-reaching consequences for public policy, as I hope to demonstrate. Essentially, I want to raise two questions: should we continue with the long-running efforts of central and local government to clean up the River Tyne, and should the burden of paying for that be shared between central and local government? Ideally, of course, the polluter should be made to pay. However, if that is not a practical way forward, that does not relieve those of us in public life of the obligation to find a solution to the problems.
Until recently, these were not particularly controversial questions. The statutory responsibility lies with local authorities. Government recognised the exceptional nature of these issues, the financial consequences and the broader public interest in remediation, and therefore made a financial contribution towards the costs. Newcastle city council, under both Labour and Liberal Democrat administrations, deserves credit for the way the local authority has proactively worked to remediate contaminated sites within the city boundaries. Alongside that, it has developed an imaginative and very successful public-private partnership to bring new employers to the north banks of the Tyne.
So successful has the local authority been, working in partnership with the Department for Environment, Food and Rural Affairs and its predecessor Departments, that there is only one significant cause for concern remaining in the city. To have got to this position is no mean achievement. The remedial work already completed includes two significant antimony sites.
The outstanding problem is the old Thomas Ness tar works site—the subject of today’s debate. The Thomas Ness tar works was a going concern from 1920 to 1981. Its function, as the name suggests, was to produce coal tar. As a young official of the General and Municipal Workers Union, I played a small part, back in 1981, in negotiating the redundancy terms for the work force when it closed. Following closure, the factory was demolished and some remedial work was carried out to the site. However, it was still contaminated, and it quickly became clear that the contaminants were leaching into the river. Underneath the site, the sand and gravel are also heavily contaminated with tars and oils. To this day, the site causes significant water pollution in the adjacent River Tyne, as well as posing a risk to human health, with reports of serious headaches being suffered by members of the public who use the nearby foreshore in the Walker country park after only 10 minutes in the area.
In 1984, the then Tyne and Wear county council sponsored an intervention aimed at dealing with part of the problem, but the Tyne and Wear scheme could not have dealt with the underlying problem of coal tar seeping underground on the site and then dispersing. It was designed to catch the tar nearer the surface and divert it through a trench into a containment tank. That was only partly effective and in any event could not have stopped the seepage into the river.
Newcastle city council made a more thorough attempt at remediation in the late 1990s. Essentially, the city council’s scheme was a pumped treatment scheme involving pumps in wells along the site’s frontage facing the river. I should say at this point, for those who are not familiar with the area, that the site is on the riverbank, and therefore natural seepage from it would be downhill towards the river. The tar clogged up the pumps, wrecking the scheme.
Government Departments worked closely with Tyne and Wear county council and the city council in a constructive way to try to solve the problem. That is all I am asking for today. In a notice from the Department for Environment, Food and Rural Affairs dated December 2013, the Under-Secretary, Lord De Mauley, wrote to all local authorities in England. His opening sentence was:
“I am writing to update you on the future of DEFRA funding of the Contaminated Land Capital Grants Scheme”.
The letter is not really an update, however; it is a retreat from financial responsibility for these matters.
DEFRA had issued revised guidance to local authorities in April 2012 obliging them to focus their attention on the highest-risk sites, while allowing them to dismiss lower-risk ones. Let nobody be in any doubt: the site under discussion is a high-risk site. The key issue, of course, is the Government’s financial contribution to solving the problem. The DEFRA contaminated land grants budget has gone from £17.5 million in 2009-10 to £2 million in 2013-14. An increase of £500,000 is budgeted for each year after that until 2017, when the budget head will be abolished.
Depressingly, the Minister will probably say that the council should pay for the whole thing using money provided by the Government through the revenue support grant, but the revenue support grant for north-east local authorities is not adequate to meet their day-to-day statutory functions, let alone carry extra ones without any remedial action-specific grant-aid from central Government. That, of course, would lead us into a much wider debate. I hope that the Minister will engage constructively with the issue, rather than trying to hand the whole thing over, unfunded, to the local authority.
Newcastle city council has a proposed way forward for containing the contamination on site. It has presented the scheme to the Environment Agency, which assessed and approved the proposed scheme. The Environment Agency’s reply to the council is blunt and honest, and the Environment Agency deserves credit for setting out the situation in clear terms. It states:
“We currently have insufficient funds within the Capital Works Programme to be able to support this project as well as other projects with higher priority scores”.
You cannot get clearer than that, Dr McCrea.
The question for all of us involved in public life is whether we leave things as they are or try to find a constructive way forward that would at least contain the problem. Let there be no misunderstanding: my preferred solution would be to eradicate it altogether. If that is not realistic, however, the very least we can do is to try to protect the river from further contamination and contain the problem on site. That, as I understand it, is essentially the local authority’s proposal.
So much work has been done and so much effort has been put in to improve the condition of the Tyne that it seems disproportionate to walk away from the problem now. We are very close to restoring the River Tyne to its pre-industrial quality. Central Government have played an important part in getting us to where we are now, and they should help us to finish the job. We need a comprehensive plan for the river as a whole, including the upper reaches of the north and south Tyne. We need a latter-day Tyne improvement commission to bring public authorities and private sector interests together, to set a clear programme of remediation for the whole river right the way to its upper reaches, to drive the work programme forward and to remain vigilant on any emerging causes of pollution. That would have to be paid for. No local authority in the north-east is in any position to make a significant financial contribution to the project, nor is it reasonable to try to pass the cost on to private sector interests, which are, after all, not responsible for the pollution. There is a necessary role here for Government.
I accept that the problem is not unique to the Tyne, and that the Minister will be faced with similar issues in other parts of the country. I would like to explore with him constructive ways of taking the issue forward and hope that he, or one of his colleagues, is open to a meeting at which we can explore the matter further.
I congratulate the right hon. Member for Newcastle upon Tyne East (Mr Brown) on securing the debate. I was interested to hear about his long-standing connection with the plant, and his negotiation of the redundancy deal for former workers.
As the right hon. Gentleman explained, land contamination is a complex area. The issue of the St Anthony’s former tar works and the pollution of the River Tyne shows that. The Department for Environment, Food and Rural Affairs and the Environment Agency are aware of the site and the agency has been in regular contact for several years with Newcastle city council, which owns the site and is designated the “appropriate person” under the Environmental Protection Act 1990. We continue to offer advice and guidance.
I acknowledge the council’s work to deal with the site. DEFRA recognises that it initiated work in 2000 to try to prevent the flow of hydrocarbons into the river. Unfortunately, that system failed shortly after installation. Following that, further investigation was funded through the contaminated land capital grants scheme at a cost of £240,000, and that led to the site being determined under the legislation in 2007. The council was successful in securing further funding of £189,000, resulting in a detailed design for remediation of the site. DEFRA has therefore already provided more than £400,000 in capital funding to support the council in dealing with the site.
As the right hon. Gentleman pointed out, however, the budget for the grants scheme has undergone significant cuts in line with the economic downturn, and since 2010 no further funding could be made available for the site following the assessment and prioritisation of all applications for funding. Other bids, such as those to do with landfill gas entering residential properties, would be considered a higher priority, given the greater risk to public health on the measures that we use to assess such projects. Vapour monitoring at St Anthony’s established that there was no health risk to users of the walkway on the river bank, and there is currently no evidence that the site is causing a breach of the status of the Tyne estuary for the purposes of the water framework directive.
The phasing out of the grant scheme is regrettable, but it reflects a necessary change of approach following a review of departmental priorities and expenditure. DEFRA and the Environment Agency are not immune from the necessary funding constraints that all Departments are under. Government can continue to support only those projects that are considered to be the highest priority, and absolute emergency cases, until the scheme ends in 2017.
I want to explain how contaminated land is dealt with in England, and the additional work that has been undertaken by DEFRA to support local authorities so that they can direct resources to the highest-priority sites. The contaminated land regime, as set out in part IIA of the 1990 Act, provides a risk-based approach to the identification and remediation of land where contamination poses an unacceptable risk to human health or the environment.
Responsibility for identifying such contaminated land is a local authority obligation under part IIA, and, since 2000, financial support has been and will continue to be provided through the revenue support grant provided by the Department for Communities and Local Government. That is exactly the answer that the right hon. Gentleman predicted. The revenue support grant is not ring-fenced, and it is up to local authorities to decide where to allocate the money according to their individual priorities.
Changes made to the part IIA statutory guidance in April 2012 have resulted in a more stringent, risk-based approach to identifying and remediating contaminated land, meaning that more resources can be directed to those sites most in need. It is a simple fact that with far fewer resources, we must prioritise where spending goes first.
We are now in the final stages of DEFRA-funded research to develop new screening levels that will screen out low-risk land from the need for further investigation, thus saving money for local authorities. Once published, the screening values will sit alongside DEFRA research published in 2012 on the normal background concentrations of contaminants to help inform decisions. Case studies are also being published from the work of the contaminated land national experts panel, which is a free resource available to support local authorities that face the more difficult, borderline decisions so that they can understand what would or would not be required. It is important to note that the environmental permitting regime for current activities, particularly on redeveloping sites where there is potential to cause contamination, ensures that no new part IIA contaminated sites should be being created.
There has been a broader analysis of the health impacts. DEFRA-funded research on the current state of scientific knowledge on the health effects of contaminated land found little direct evidence of serious health effects from the types and levels of land contamination found in England today. We are not complacent, however. Such effects cannot be ruled out in all cases because it is sometimes difficult to prove causality, and there are reasons to be concerned that some sites might pose significant risks from longer-term exposure. We therefore take a precautionary approach to the identification and remediation of contaminated land, which is reflected in the development of the new screening levels for contaminants in soil.
The right hon. Gentleman stated that, in this era of lower public spending, we have to consider how to put right historical contamination. An estimated 90% of contaminated land in England and Wales is cleaned up through the planning system under the national planning policy framework, which has played an important part in making the planning system less complex and easier to understand, thereby encouraging sustainable development and the effective use of brownfield land where appropriate. The key for many sites is to redevelop them and, as part of that redevelopment, to have an agreement with the developer that they will put right the contamination, as they have the proceeds of the redevelopment to invest.
I am open to exploring with the Minister any practical way forward that will address the problem, and I know that he proposes that idea constructively, but I cannot see it working with the site in question. The difficulty would be in finding some way either to prevent the tar from leaching into the river, or to clear the tar off the site altogether. The capital cost of a protective measure, let alone a complete clearance, is likely to be several million pounds, which must be far more than any possible planning gain that could be made on the site.
I am not sure. One estimate I heard is that it would cost somewhere between £1.2 million and £1.5 million to put the site right. I take the right hon. Gentleman’s point, and he understands the site better than I do, as he is the constituency MP. There are possibilities in many instances. Local authorities across the country hold toxic assets that are something of a liability. We have many such sites in Cornwall. I grew up in a mining area, and we have our share of arsenic and contaminated land. Deals can often be reached in which the local authority effectively gives the land to a developer in return for the developer putting right the contamination. I have seen that work in my part of the country—the opposite end of the country from his constituency—where we also have contamination caused by tin mining. We need to explore such things, otherwise we go full circle and come back to the question of whether using public money is justified. We have introduced a new screening process for prioritising sites that are a direct threat to health in residential areas, and we have been frank and honest that we cannot justify the expenditure at this stage. I hope it will be possible to explore the approach I have outlined.
Also, land remediation relief will support developers. The Government are encouraging a market-based approach to dealing with contaminated land, as much as possible. One financial incentive that the Government have provided to encourage the redevelopment of contaminated land is land remediation relief, which allows companies to claim back corporation tax on 150% of the costs of dealing with contaminated land, and which is intended to influence developers’ decisions positively by increasing the profitability of redevelopment projects. The Treasury estimates that the value of land remediation relief is around £30 million per annum, suggesting that the private sector is spending approximately £100 million on land remediation relief-compliant voluntary remediation each year.
The Government are also trying to encourage local authorities, LEPs and enterprise zones to find solutions to toxic sites that have not so far been suitable for redevelopment. Furthermore, DEFRA is working with the Environment Agency and the Coal Authority to address water pollution from abandoned metal mines. DEFRA has agreed to a modest and targeted approach, initiating one to two new remediation schemes each year, subject to funding. I appreciate that that particular fund is of little use in relation to the former tar works at St Anthony’s, but it is nevertheless indicative of the fact that we continue to do what we can on the issue with the resources we have.
I mentioned earlier that emergency cases will still be funded. As part of the announcement on the future of the grants scheme, my noble Friend Lord de Mauley made it clear that, subject to capital funding allocations, a contingency fund of £500,000 each year will continue to be available until the scheme ends in 2017. DEFRA is working with the Environment Agency to agree how the contingency fund will be administered; that will enable the fulfilment of ongoing projects as far as possible, and provide funding in case of emergencies. An announcement on that will be made soon, and will include details of the qualifying criteria for such cases.
To conclude, DEFRA will review the impact of the changes to the grants scheme for local authorities 12 months after the changes are introduced in April 2014. In addition, it has commissioned a new state of contaminated land survey, which will collect information on part IIA regulatory activity, the apportioning of liability, and the funding mechanisms used for dealing with contaminated land. The report will be produced by the Environment Agency before the end of 2014 and will provide information that can be used when reviewing the impact of the changes to the grants scheme.
I thank the right hon. Gentleman again for bringing this debate before the House. I am sorry that I have not been able to give him any more reassurance than the Environment Agency has, but I hope that he will appreciate the difficult constraints that we face and the need for us to prioritise our spending.
Dr McCrea, like me, you represent a constituency with a rich industrial heritage that no doubt has similar problems, albeit perhaps not exactly of the nature we have been discussing. I am very disappointed by what the Minister has said. He has, however, offered one constructive suggestion, which I note would not cost the Government any money. Nevertheless, it is a constructive suggestion and I will take it up with the local authority and others locally.
I agree with the Minister that the possibility of a commercial way forward for the site is worth exploring. The figures he cited are the same as my own—a cost of roughly £1.2 million to £2 million for the council’s preferred scheme to try to contain the tars and prevent them from leaching into the river, but it would contain them on site. I do not know how commercially attractive that would be to a developer. My preferred option would be a one-off capital clearance of the whole site to clear it up completely and bring it back to a more pristine standard, certainly than it has known since 1920. However, my suspicion is that that would cost more money.
I rather thought that the Minister would turn me down on the money, and that he would refer to the Department for Communities and Local Government grant arrangements—
I omitted to deal with that point, which the right hon. Gentleman raised. I am more than happy to go back and raise that point with Lord De Mauley. He is responsible for the matter because it is in his portfolio, even though I handle it in the Commons, and I am sure that he will be willing to meet and discuss it further. I have been as honest and frank as I can with the right hon. Gentleman about the constraints that we have. As I have said, a large sum of money is required to put the site right. We have made it clear that we have only about £500,000 a year for the whole country, so he can appreciate that it would overwhelm us. I will nevertheless take that point back and ask Lord De Mauley if he will have a meeting.