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Business, Energy and Industrial Strategy

Volume 630: debated on Tuesday 7 November 2017

The Secretary of State was asked—

Electric and Autonomous Vehicles

6. What steps he is taking to support businesses that are developing connected and autonomous vehicles through the Midlands Engine. (901639)

Our industrial strategy capitalises on our strengths as we build the next generation of motor vehicles. In July, we committed £246 million to the Faraday Battery Challenge to make Britain a centre for the development of battery storage. I have also announced £51 million to fund automated vehicle testbeds across the country. I am delighted to say that in October Ford opened its new European Mobility headquarters in Britain.

Whether lorries or tractors, it is in rural areas where autonomous vehicles have the potential to make a particularly profound impact. Will my right hon. Friend assure me that the research that he is funding will look in particular at rural areas rather than simply focusing on our very well connected cities?

My hon. Friend makes an excellent point. He is right in saying that, if this is to apply right across the country, the opportunities in rural areas are very important not just for the vehicles he describes, but for public transport. He will know that at the University of Lincoln, not far from him, excellent work is being done through the Centre for Autonomous Systems on the future of mobility. I hope that it will be a participant in this great wave across the country of research and development in the technologies of the future.

Silverstone Technology Cluster supports many thousands of jobs in and around Northamptonshire, including in companies such as Cosworth in my constituency of Northampton South. What steps are the Government taking to support the Silverstone cluster?

My hon. Friend is absolutely right that the choice that some of the world’s best motor manufacturers make to locate in the cluster reinforces our reputation. Last year, we launched the Aylesbury Vale enterprise zone, which supports the Silverstone high-performance technology cluster. It provides an environment that is helping to deliver new jobs in this sector. The local growth fund for his area includes an innovation centre, which is geared to automotive technology in the enterprise zone.

I urge the Secretary of State to say something to leading engineering businesses and the University of Huddersfield where we are doing a lot of research on autonomous vehicles, because they might have listened to “Today” on Radio 4 this morning and heard another Secretary of State using a mysterious kind of language. He was talking about “a new post-Brexit trade policy” and “a new trade remedies body”—what is a new trade remedies body?

I do not care what a new trade remedies body is. All I am concerned about is autonomous vehicles—electric or otherwise. Let us hear about the matter.

The hon. Gentleman asks an important question. It is absolutely right that the researchers at the university will have huge opportunities in this area. The reputation for excellence that has been established in that university is well known not just across the country, but around the world. The Prime Minister and I had the privilege of attending a roundtable of the leading managers across the motor industry, including the supply chain. They are united in their excitement about what is the biggest change in mobility since the invention of the petrol and diesel engine. We are replete with these possibilities, and it is increasingly recognised that we are establishing a reputation for being the place in the world to come for them.

Whether it is exporters of autonomous vehicles or other exporters within the automobile industry in my constituency, what they need going forward is a consistent regulatory framework. What kind of guarantees can the Secretary of State give to exporters such as those in my constituency as we leave the EU?

The hon. Gentleman makes a good point. The predictability of the regulatory environment is extremely important for future investment. It is one reason why we have introduced the Automated and Electric Vehicles Bill, which will be ahead of the world in establishing the right regulatory environment for electric and autonomous vehicles. Again, this is something that has commanded the attention of the world, and it is exactly in line with what he says.

As we take steps to grow the economy and decrease emissions, will the Secretary of State commit to working with all businesses involved on the noise that autonomous and electric vehicles make, as highlighted by my deaf and blind constituents, and to working with the disabilities agenda as this new technology moves forward?

My hon. Friend is absolutely right that one of the advantages of the new technologies is that they give particular hope to people who find it difficult or impossible to use conventional vehicles. Part of the point of putting together the research in the automotive, renewable energy, healthcare and social care sectors is that we can join the benefits of all of them in a single programme.

If we are going to have these electric vehicles, these autonomous vehicles, and everything else is going to be wonderful, why bother with £100 billion on HS2?

Because we need both. Our ambition is to make this country one of the best connected in the world so that it is possible to go from the capital to our midlands, northern cities and beyond quickly and efficiently, and have more capacity to move freight around the country. I would have thought, given the importance of the motor industry to Derbyshire, that the hon. Gentleman, as a Derbyshire MP, would welcome the investment and progress in the sector, including £250 million invested by Toyota in its excellent plant.

Germany has said 2030; Norway and Holland are aiming for 2025. The Chinese owners of Volvo say that all their new models will have an electric motor from 2019. As the climate conference in Bonn begins, does the Secretary of State consider that the UK Government’s plan to ban the sale of fossil fuel vehicles from only 2040 is somewhat lacking in ambition, failing to provide strong leadership, or downright pathetic and making the UK a laughing stock?

If the hon. Gentleman reflects on our reputation in the world, he should know that, for international leadership on climate change, it is very strong. He would do well to commend rather than undermine that. In the past few weeks, we launched the clean growth strategy, which commits, across a range of areas, not just to meet our legal commitments and generate jobs in those important technologies, but to lead the world in exports. I would have thought that he would use his time at the Dispatch Box to commend the Government for a document that has been well received across the world.

Leaving the EU: Civil Nuclear Industry

2. What assessment he has made of the effect of the UK leaving the EU on the civil nuclear industry. (901634)

The Government have made clear their commitment to the continuing success of the nuclear sector, including nuclear research, in this country. We are aiming for a maximum level of continuity with the current arrangements. My Department has held discussions with the sector to ensure we understand and address its concerns.

Does the Minister agree that the uncertainties over leaving the EU, as well as the falling prices of solar energy and the timescale for delivering the projects, will make nuclear energy projects such as Hinkley Point deliver very little value for money?

I very much disagree with the hon. Lady’s assessment. The Government’s policy is to go for a mix of different types of energy, of which nuclear power is firmly and clearly one, as are renewables and all the others.

As the Minister knows, the nuclear industry is extremely important to Cumbria. Does he agree that leaving the EU has its issues, but that it is far more important to ensure that we have a nuclear sector deal as part of the industrial strategy, which will mean real investment and growth in the sector?

I agree with my hon. Friend and I commend him for all his work to support the nuclear industry. We are very well aware of the nuclear sector deal. I met leaders of the industry last week, as I do repeatedly, to ensure that their sector deal is important and will be relevant to carrying the industry forward for a long time in the future.

19. The civil nuclear industry is getting increasingly twitchy about Euratom transition arrangements. Will the Minister today clarify whether Euratom membership can continue during the transition period and, if not, will he support the cross-party amendment 300 to the European Union (Withdrawal) Bill, which would protect the civil nuclear industry from a cliff-edge Brexit? (901656)

The hon. Lady will be aware that these matters are being discussed in the Bill Committee. The Government intend to build a consensual view to ratify the problem. I know she has a keen constituency interest. The Government are aware of all the issues. It is our intention to have the closest possible relationship with members of Euratom.

It is very important that we achieve an agreement with the EU that enables us to retain as many of the benefits of Euratom as possible. Will the Minister say something about the future of small modular reactors in the UK?

My hon. Friend makes an excellent point. The Department is looking closely at small nuclear reactors. We have had presentations from many different companies and entities involved in developing this technology. We hope this will be brought to a conclusion very quickly. I commend him. I visited his constituency to see the research work going on there. We are very supportive of it.

Exiting the EU is introducing an added complication into the efforts to rescue the Moorside deal, with all the jobs and security it would bring. Are the Government open to the idea of offering a stake in the Moorside project if the conditions with a particular buyer are right?

I would make two points to the hon. Gentleman, who is also a worthy champion of the nuclear industry: the Moorside arrangement is a private commercial matter for Toshiba; and in my view what is happening with Euratom and the EU is not really relevant here.

Horizon 2020 Programme

3. What steps he has taken to ensure that the UK participates in the Horizon 2020 programme for the duration of that programme. (901636)

The Government have acted quickly to underwrite Horizon 2020 funding that is competitively bid for by UK participants. As we set out in our future partnership paper, “Collaboration on Science and Innovation”, we will seek an agreement on science and innovation that protects us now and in the future, and continues to ensure we deliver these great partnerships.

Edinburgh is blessed with three world-class universities, Napier, Heriot-Watt and Edinburgh, which punch significantly above their weight in being able to gain EU funding for research and development. Will the Minister come to the Dispatch Box to reassure those universities that they will still be able to access research and development funding at European Union level when we leave the EU?

As I said, we are working towards an agreement that will ensure our continued success in European science and research collaborations. Scottish institutions do indeed do exceptionally well. They punch well above their weight in winning about 11% of the share of UK participation in Horizon 2020, which is well above their GDP and population share. We want that to continue.

18. The Minister is right to highlight that Scottish universities are world-beating. In my constituency, the University of St Andrews receives £38 million of research funding that relies on our partnerships with the European Union and European institutions. What reassurances can he provide about plans post-2020, so that those partnerships will be able to continue? (901655)

As I just said, we are working hard to ensure an agreement with the rest of the European Union to ensure we can continue to collaborate closely in important areas of research and innovation. I repeat, Scottish institutions do well in terms of their share of overall UK participation in Horizon 2020. We want that kind of success to continue in the years ahead. Very impactful research is done in Scotland on a collaborative basis across the continent. We have every intention of that continuing in the years ahead.

Science and Innovation: Worcestershire

We have committed to the single largest increase in science and innovation funding for nearly 40 years, adding an additional £4.7 billion to our science spending. This helps to drive growth across the country, and I am pleased that a consortia led by Worcestershire local enterprise partnership will be undertaking a science and innovation audit on the theme of cyber-resilience. This will identify local research and innovation strengths to drive economic growth.

Following the commitment in the industrial strategy Green Paper to build new institutes of technology, will the Minister, if his diary permits, meet me in Redditch to review what an excellent location it would make for one of the first institutes of technology? It has fantastic transport links and access to business, and would provide a great opportunity for young people.

My hon. Friend is a strong champion for her constituency, and I am pleased to say that we have recently issued a statement confirming our intention to establish high quality and prestigious institutions that specialise in delivering the higher level technical skills that employers need across all regions of England. We will be launching a call for proposals before the end of the year and would welcome applications from Redditch and other places across the country.

Leaving the EU: Scottish Research Sector

5. What recent assessment he has made of the effect of the UK leaving the EU on the Scottish research sector. (901638)

As I have said, Scottish institutions are performing well in terms of their participation levels in Horizon 2020, and we want that to continue in the years ahead. The Government are working hard to ensure the success of our institutions and to get an agreement that enables us to continue to collaborate in the years ahead.

Of course we also want our institutions to continue to do well, but our research sector is facing a significant loss of funding owing to Brexit, which will of course impact on innovation. What direct communication have the Government had with Scottish universities about the funding threat posed by Brexit?

The Department for Business, Energy and Industrial Strategy and the Department for Education are in constant contact with all the devolved Administrations at various levels on a wide range of issues, including EU exit. BEIS participates in various forums, including the UK research funders group, and officials have recently participated in working groups with the Scottish Government, Universities Scotland, Heriot-Watt University and Edinburgh University.

Carbon Capture and Storage

7. What steps he is taking to support the development of carbon capture and storage technology. (901640)

Carbon capture usage and storage has huge potential to play a vital future role in reducing emissions across a range of activities, but the technology has to be made more cost-effective to deploy at scale. That is why we have committed up to £100 million of public money in CCUS innovation in our clean growth strategy and why are working with the private sector and other Governments to drive up technological innovation and to drive down costs.

The clean growth strategy falls short of boosting the investment necessary to stimulate change in carbon capture and storage, and the industrial strategy Green Paper failed to mention it. In the light of the previous failure to deliver on Peterhead, what measures will the Minister announce to recover that investment?

The world has not yet decided to invest in traditional CCUS. There are 21 at-scale plants operating globally, of which 16 rely on enhanced oil recovery as a revenue stream. It is simply not cost-effective enough in its current form for us to commit large-scale investment. We have to get the costs down. We are now in a world where the private sector wants to invest, however, and I am sure we would both welcome developments such as Project Acorn, to which both the UK Government and the Scottish Government have committed funds.

The Minister does not like being reminded that the pulling of the £1 billion for the Peterhead project was a betrayal of the north-east of Scotland and the Scottish energy sector. She talks at the Dispatch Box about value for money, but the strike price of £92.50 at Hinkley is not value for money. When will the Government make real financial commitments to CCS in Scotland?

In the world I live in, £100 million is quite a substantial financial investment in CCUS. It is striking that the Scottish Government invested only £100,000 in Project Acorn, as opposed to our £1.3 million. The point remains that the technology is not cost-effective. Only six plants in the world are operating without additional revenue from enhanced oil recovery. We want Britain to be the technological leader and to develop cost-effective solutions. I hope that we can work together to achieve that aim.

I welcome the return to some consideration of CCS in the clean growth plan, after the Government’s dreadful mistake in cancelling the £1 billion UK CCS pilot plants in 2015. What discussions has the Minister had with her Norwegian counterparts on the prospects for UK-Norway collaboration on that country’s advanced plans for carbon sequestration in the North sea?

As the hon. Gentleman will know, Norway is currently a little bit unsure about the level of its own financial commitment. However, it has an excellent Energy Minister, with whom I have had multiple meetings and conversations. It seems strange to me that, having taken the hydrocarbons out of the North sea basin, we should not co-operate to put the carbon dioxide back, so there are frequent conversations. The hon. Gentleman will have seen the clean growth strategy, on which we would like very much to work with other countries—not just Norway, but the United States and Canada as well.

We have just heard about the broken promise to establish a world-leading carbon capture project at Peterhead. That is another betrayal of the North sea industry: £1 billion was never invested, and 600 jobs were never created. Is it not true that when it comes to the North sea, this Government are no good at anything except breaking promises?

Some might say that the Scottish National party is not very good at forecasting oil prices. As I have already said, no Governments have taken a very substantial bet in the past few years—I call it a bet because it is not cost-effective—but, as the hon. Gentleman will know, organisations such as the Oil and Gas Climate Initiative are asking us, “How can we work together in a public-private arrangement to deliver the best, most cost-effective solutions?” We need to create some technology that we can export, like the oil and gas services that have delivered such economic value in the North sea.

Support for the North sea was also promised by the former Prime Minister in January 2016, when he said:

“An Oil and Gas Ambassador will be appointed to…promote”

oil and gas

“around the world”.

However, the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Watford (Richard Harrington), told the Press and Journal recently that it was a “good idea” but he was “not aware” of it. He said:

“It’s not crossed my desk”.

Whose desk did it cross? Or was it just another fantasy— a false promise from a “say anything, do nothing” Government”?

I can understand why there is not much solar installation in Scotland: it appears that the sun never shines north of the border.

I will take no lessons from the hon. Gentleman about support for the North sea, which is a vital industry. I cannot answer his point about the ambassador, but I shall be happy to discuss it with my colleagues.

Leaving the EU: Automotive Sector

8. What discussions he has had with the Secretary of State for Exiting the European Union on the effect of the UK leaving the EU on the automotive sector. (901642)

I have frequent discussions with the Secretary of State for Exiting the European Union. The UK continues to demonstrate that it is an attractive place for future investment. Companies such as Nissan, BMW and Toyota continue to invest, thanks to our highly skilled workforce, the strong partnership between the Government and industry and long-term investment in new technology and innovation.

I am sure the Secretary of State is aware that some car manufacturers are questioning whether to make further investments in the UK because they are uncertain about the validity of type approvals after we have left the European Union. When will the Secretary of State be in a position to confirm that they will indeed be valid and that the trucks shipping components will not be stuck in long queues at either Dover or Calais?

I have been very clear in my discussions with the industry, and, as I said earlier, last week we had a roundtable at No. 10 with the Prime Minister. It is essential for our trading relationship with the European Union not only to be tariff-free, but to allow the continuation of a means of production that involves multiple components going back and forth, often at very short notice. There are questions about, for instance, type approval and rules of origin, and we are working with the industry to ensure that those matters are part of the deal that we want to achieve. That is a course that I know Members in all parts of the House would commend.

Mitsubishi’s headquarters are in Cirencester, where it employs 250 people and supports 113 dealerships throughout the UK. I wholeheartedly endorse my right hon. Friend’s remarks about needing to secure a Brexit agreement that supports the automotive sector, so that we can protect those jobs.

I am grateful to my hon. Friend. The industry is aware of the firmness of our intention. It makes no sense to disrupt what has been a very successful relationship between this country and some of the home countries of those manufacturers: that is very clear in all our minds.

Our successful car manufacturing sector exports nearly 1 million cars a year to the rest of the European Union. However, the Society of Motor Manufacturers and Traders has said:

“Brexit is the greatest challenge of our times”.

What is the Secretary of State doing to ensure that there are no costly tariffs or time-consuming customs checks in the sector after we leave the EU?

We met the SMMT and all members of the sector to discuss every aspect of the challenges and opportunities ahead. The hon. Lady is of course right that Brexit is very much on the minds of every motor manufacturer, which is why the discussions we have had reinforced our commitment not only to secure a good deal at high level, but to make sure all the particular aspects for that industry are addressed. The industry was also enthusiastic about our clear commitment, with mounting enthusiasm being shown on the part of our partners, big and small, to invest in the future and to make sure that what makes Britain attractive as a place to locate continues to be so in the future.

Ten years in low-paid work and then four years a Jaguar apprentice, I will never forget Warren waxing lyrical about the job that he loves, and moving into, in his words, the house of his dreams with the woman of his dreams. Does the Secretary of State begin to understand that, as a consequence of this Government’s disastrous mishandling of Brexit, investment has fallen by over 50%? Does he begin to recognise the damage the Government are doing to workers like Warren and the jewel in the crown of British manufacturing?

If the hon. Gentleman talks to people in the motor industry, as in other industries, he will know that no one is more vigorous and active than I am in meeting prospective investors to explain our strategy and the attractiveness of the UK. As a result of the industry’s work, supported by the Government, we have had a commitment from BMW to build the electric Mini in the UK, Toyota is investing a quarter of a billion pounds in Derbyshire, Nissan has confirmed that it will build two new models in Sunderland, and other discussions are continuing. That work, in the context of the need for continued good access to the European market, is giving confidence to the industry. I would have hoped that it was a matter of consensus across the House that we should maintain that confidence, rather than seek to undermine it.

Smart Meters

9. What assessment he has made of the effect on consumers’ awareness of energy consumption of installing a smart meter. (901643)

Recent research has been conducted by Smart Energy GB, the independent not-for-profit organisation responsible for national consumer engagement on smart meters. It found that 86% of people with a smart meter said that they had made energy-saving changes to their behaviour and that this positive action was maintained over time after installation.

The Minister is obviously aware that, by encouraging better energy consumption, the average consumer saves about £75 a year through a smart meter. Does he agree that smart meters will enable more switching of suppliers, saving the average customer £200 a year, and that this is therefore good for the environment and for consumers?

I totally agree with my hon. Friend’s analysis. Smart meters enable consumers to make more confident and informed decisions about which supplier and tariff is right for them. Interestingly, Ofgem’s survey for 2017 showed that consumers who say they have a smart meter are more likely to have switched supplier in the past 12 months.

Energy consumption and awareness is a two-way street, and the companies are aware of what energy is being consumed in the home, so what steps is the Minister taking to ensure that energy companies do not increase the customer’s daily rate as customers reduce their energy consumption?

The hon. Lady should rest assured that this is on our agenda. Increases must have Ofgem approval, and it is something we are monitoring very carefully.[Official Report, 14 November 2017, Vol. 631, c. 1MC.]

The Government consider the security of smart meters to be very important, and the whole smart meter programme was designed with the approval of the cyber-security body and all the other relevant authorities.

How does the Minister intend to make the process for switching between gas or electric companies easier for those with smart meters, as the process is extremely convoluted, to use a Ulster-Scots-ism, at present, with customer smart reading going dumb and manual readings having to be sent out?

The hon. Gentleman should be aware that the SMETS 2 programme involves complete compatibility between all the different meters, enabling people to switch. The current system that is being installed, SMETS 1, will be applicable for that in, we think, about a year, when the software allows that to happen.

Paris Climate Change Agreement

The UK was a leading negotiator of the extraordinary Paris agreement in which 195 countries agreed to act to keep the global temperature rise well below 2°. In 2016, only two countries in the world cut their carbon emissions intensity in line with that Paris goal: China and the UK. Last month, our clean growth strategy set out how we intend to go further and faster in cutting our UK emissions to reach the Paris goal, while delivering economic growth.

Many of my constituents have contacted me with their concerns about climate change. Following Paris, what steps is the Minister taking to ensure that there is a global political movement to combat climate change?

I will be going to Bonn next week for the 23rd United Nations climate change conference with the council of partners, where we will join other leading nations in reaffirming our commitment to the Paris goals and working on a variety of practical initiatives such as the phase-out of power generation from unabated coal. Britain, which started the industrial revolution using coal, now leads the world in phasing it out. We will also be working on the use of innovative financial solutions to mobilise private investment in low carbon technologies.

How does the Minister intend to support carbon capture and storage in the Tees valley, given that that, too, would improve our environmental ambitions and enhance economic growth?

The hon. Lady will know that the Tees valley has been incredibly assiduous in campaigning in many ways to be a location for the deployment of the new technology. We are working actively with it and we would like to see some investment proposals coming forward.

In reaffirming the UK’s commitment to the Paris climate change deal, will my hon. Friend assure me that she had her colleagues will continue to pressure and persuade other countries that have not signed up to it or that might be reticent about its merits and about why they should be involved?

My hon. Friend makes a good point: we are only as good as the partners that we are working with. Other countries, including India and China, have set progressive goals for their own countries involving very rapid decarbonisation. Paris remains fit for purpose and will not be renegotiated. We would like all countries, particularly the major OECD countries, to change their minds and get behind this groundbreaking agreement for the world.

The Committee on Climate Change clearly states that fracking cannot be compatible with the UK’s climate change targets unless three key tests—on methane gas, on gas consumption and on carbon budgets—are met. Given that the Government have not shown that those tests can be met, will the Minister’s Department refuse consent for fracking in Ryedale, North Yorkshire, which is currently under consideration, or is she planning simply to ignore the advice from the Committee on Climate Change?

We cannot comment on particular cases. Testing wells are being drilled at the moment, and we need to understand the scientific basis, so that we can prove or disprove these tests. I find it slightly odd that those who argue the loudest that people should accept the scientific basis for climate change refuse to have a conversation about the scientific basis that would prove or disprove the case for fracking.

Royal Bank of Scotland: Small Business Customers

11. What discussions he has had with the Chancellor of the Exchequer on the conclusions of the recent Financial Conduct Authority report on the Royal Bank of Scotland and small business customers. (901647)

My right hon. Friend the Secretary of State has frequent discussions with the Chancellor on a range of matters, including financial regulation. The Financial Conduct Authority has published a summary of Promontory’s skilled persons report, to which I think the right hon. Gentleman refers. The FCA is now considering the report’s conclusions, including whether there is any basis for further action.

Constituents of mine have, in good faith, used Government-based schemes such as the enterprise finance guarantee scheme to grow their businesses, only to find the Royal Bank of Scotland using the very same scheme to close down their businesses. Given that there is a litany of such cases throughout that report, is it not now time that the Minister and the Treasury conducted a proper investigation and perhaps even a judge-led inquiry?

The enterprise finance guarantee scheme was exactly designed to enable businesses to borrow when they lacked collateral, with taxpayer support. If a bank is closing down overdraft facilities to claim on the guarantee—as in the case to which I believe the right hon. Gentleman refers—that would clearly be a gross abuse of the scheme. Any evidence of that will certainly be looked at very carefully by my Department.

Does the Minister not agree that the response to the finding that 92% of the bank’s restructuring group’s small business customers were mistreated has been pathetic and is unworthy of a publicly owned institution?

I suggest that the right hon. Gentleman hold fire until the Financial Conduct Authority has decided on what action it may still take. It is empowered to take action, and I totally agree with the sentiments behind his question.

What happened at RBS’s Global Restructuring Group is a scandal of the highest order. Businesses were ruined; families were torn apart; and people took their own lives. The Minister must know that the FCA cannot deliver justice for the GRG’s victims on its own, because most business banking is unregulated. I have asked Ministers this question six times already, and I will ask it a seventh time: will the Government set up a judge-led inquiry into RBS GRG, or do they have something to hide?

I can assure the hon. Gentleman that we have nothing to hide. I share the concerns about the practices of the Global Restructuring Group at RBS and the devastating impact on people’s businesses, which represent a lifetime’s work for many people. I am sure that we have not yet heard the last of this inquiry.

Leaving the EU: Car Industry

The UK’s automotive industry is a great British success story, and as I said earlier, the Prime Minister and I met senior executives last week and reiterated our determination to secure a Brexit deal that guarantees the sector’s competitiveness. I will continue to work closely with all companies in the sector.

I am grateful to the Secretary of State for mentioning Ford in an earlier answer, because Ford is a major employer in my constituency. What is his Department doing to ensure that this country is the epicentre for innovation in the car industry as we move out of the European Union?

Through our industrial strategy, we have a clear focus on being the go-to place in the world for the future of mobility in all its different forms. Dunton in my hon. Friend’s constituency is home to Ford’s technical centre, which is obviously one of the major global forces in that future. It is particularly gratifying that Ford has chosen the UK to be the centre of its European operations for the future of mobility.

Social Care: Minimum Wage Back-Payment

15. What discussions he has had with Cabinet colleagues on providing funding to ensure minimum wage back-payment in the social care sector. (901652)

17. What discussions he has had with Cabinet colleagues on providing funding to ensure minimum wage back-payment in the social care sector. (901654)

I have worked closely with ministerial colleagues to implement a national minimum wage enforcement approach that protects the interests of social care workers and vulnerable service users. The Government recognise the financial pressures that some providers face, and we are exploring further options to minimise any impact on the sector. Any intervention would need to be proportionate, and the Government have opened discussions with the European Commission about issues relating to state aid.

I thank the Minister for that answer, but how are the Government supporting individuals with personal budgets who could face bills of thousands of pounds in back-payments?

We recognise that such individuals can be among the most vulnerable in society, and we are working to ensure that that group receives the necessary help and support. We expect local authorities to work with Her Majesty’s Revenue and Customs to ensure the right outcome for such individuals, but it is only fair that the budgets provided to personal budget holders reflect their legal obligations to pay the national minimum wage to workers on sleep-in duty both now and when it comes to any arrears owing.

If enforcement action results in the closure of or disruption to service providers, how will the Government guarantee that vulnerable people will not be left without services?

I would like to reassure the hon. Lady that the new social care compliance scheme will give providers up to a year to identify what they owe to workers and will be supported by advice from HMRC. Employers who identify arrears at the end of the self-review period will have three months to pay workers, so the scheme is designed both to support workers and to ensure the continuation of the crucial services that providers perform.

The Government’s new interim compliance scheme, announced last week, unfortunately adds to the uncertainty facing the social care sector. May I urge the Minister to do all she can to ensure that, as quickly as possible, the Government get back round the table with the sector to find an acceptable long-term solution?

I assure my hon. Friend that we are working very hard across Government with the Department of Health and the Department for Communities and Local Government to continue our discussions with the Treasury about possible solutions to the long-term viability of certain providers.

I welcome the Government’s efforts to try to find a permanent solution to sleep-in shifts. The situation arose from a change in guidance following an employment tribunal in 2014. Would it not be sensible to consider revisiting the legislation in this place simply to return to the pre-tribunal position?

We have made it clear that we expect all employers to pay workers according to the law, including the national minimum wage, for sleep-in duties. It is not uncommon for employment law to be clarified in the courts and tribunals, and this issue has been the subject of a number of cases. Even if we were to do as my hon. Friend suggests—we will certainly not be revisiting the legislation—it would not have any impact on workers’ eligibility for historical back-pay liabilities.

This week is Living Wage Week. Some sectors in the UK are better predisposed than others to paying higher wages, but the rising cost of living applies to all. What will the Minister do to incentivise businesses in all sectors to sign up as living wage employers?

I applaud the work of the national Living Wage Foundation, but we have a crucial role to play in ensuring that Her Majesty’s Revenue and Customs has the resources to enforce the minimum wage, where it needs enforcing. That is our priority, although obviously I respect the work of the Living Wage Foundation.

Tidal Lagoons

16. What assessment he has made of the potential merits of the recommendations set out in the Hendry review on tidal lagoons. (901653)

As my hon. Friend knows, the issues raised by the review are complex. A lagoon programme could cost in the region of £50 billion. The costs of renewable energy are plummeting, and we need to consider the questions associated with deploying this technology in the marine environment. All programmes have to be considered with the following in mind: the cost, the export potential and the contribution to the green economy.

The Hendry review was delivered on time by a distinguished former Conservative Energy Minister who started a sceptic and finished a convert, strongly recommending that the Government push ahead with a pilot project. Although none of us would want to see the Government rush into decisions of this kind— a global first—what are the chances of a formal response before the review’s first anniversary in January? Does my hon. Friend agree that the Budget is an excellent opportunity for a positive announcement?

My hon. Friend may be frustrated, and I know the Government have yet to respond to the review, but as I have said this is an extremely complex issue and we need to ensure that we make the right decision. All I can say to him is that we will be publishing our response in due course.

Topical Questions

Since we last met, my ministerial colleagues and I have brought three major pieces of legislation to the House: a draft Bill to cap consumer energy prices; new laws to ensure that every home and small business will be offered a smart meter; and the new Nuclear Safeguards Bill to maintain our nuclear safeguards as we leave the EU. We continue to develop new policy that will benefit businesses and wider society, and today we are publishing a call for evidence on Professor Dieter Helm’s independent review of energy. We have reaffirmed our position as a world leader in tackling climate change through the launch of the clean growth strategy, and I take this opportunity to invite all Members on both sides of the House to join us in celebrating Small Business Saturday, which is coming up on 2 December.

Is the Secretary of State concerned that, although October’s figures show continued welcome manufacturing growth, almost half of the net jobs created in the UK since 2010 are in London and the south-east, where only a quarter of the population live?

I would have thought that the hon. Gentleman would welcome the fact that jobs are being created in all parts of the United Kingdom and that we have the highest level of employment since records began. That is a signal of the success of the UK economy, but he is absolutely right that we want to make sure that every part of the United Kingdom reaches the height of prosperity it is capable of reaching, and through the industrial strategy we will have more to say about how we can propel that forward.

T2. Businesses in my constituency and across the west midlands need the investment and the skills to continue to thrive and flourish. Will the Minister update me on the work the Government are doing in that regard? (901623)

We are investing in a world-class technical education system, growing apprenticeships and introducing T-levels from 2020 for 16 to 19-year-olds, backed by a further £500 million per year. We are also investing £170 million to create institutes of technology across all regions and £80 million for specialist national colleges to deliver higher-level technical education.

Last week, the Secretary of State repeatedly refused to confirm, when pressed by the Select Committee, that the energy price cap would be in place by next winter. Media reports have also suggested that the Government have already told energy investors that the draft legislation will be ditched if they feel the big six power firms are doing enough to tackle high bills. I therefore ask the Secretary of State, in the hope he will today provide a clear answer, whether the energy price cap will be in place by the winter of 2018 and, if not, whether the media reports are true that there is actually no intention of introducing price cap legislation?

I can assure the hon. Lady that there is every intention of introducing a price cap, and there is consensus in the House around that. We have published a Bill and it is being scrutinised by the Select Committee. As soon as it has finished that scrutiny, we will look for an opportunity to introduce it to the House.

I am afraid that answer simply created even more ambiguity, so let us try a different topic. The Government scheme to deal with the social care back-payment announced on 1 November has been cited as “inadequate” by many care businesses and organisations, as it does not address the fact that many providers simply cannot afford to pay due to funding cuts, and some workers will not be paid what they are duly owed until 31 March 2019. Mencap has stated that many providers will be reluctant to take part in the scheme as they feel they will be

“writing their own suicide note”.

Therefore, I ask the Secretary of State: will the Government commit the necessary funding in the Budget to avert a crisis in the care sector, which could see many businesses struggle to survive, impacting on already fragile care services, and leave thousands of care staff without the wages they are owed?

As the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Stourbridge (Margot James), has made clear, and as I believe the hon. Lady knows, this is a difficult and complex issue. We completely accept the need for confidence among the providers of care to some of the most vulnerable people in society, while recognising the legitimate claim, which has been upheld by the courts, of those who have worked in that sector. Bringing those two things together requires precision and care, so that this is robust and does not create further uncertainty if it were found not to be legally possible to advance it. That is why the interim proposal has been made, but I am happy to keep the hon. Lady informed.

Yesterday afternoon, we had an excellent debate in this Chamber about the benefits of European economic area and European Free Trade Association membership, with people on both sides of the Chamber supporting our continuing membership. I do not expect my right hon. Friend to pass comment on his own views on this matter, but I do know he will always champion the best interests of British business. To that end, will he undertake, in all the negotiations he is involved with at the highest level, to make sure that all options are kept open as to how we get a Brexit deal—that includes the EEA and EFTA?

I represent strongly the views of the business community because they are absolutely vital for our continuing prosperity as a country. The whole of the business community wants to get the best possible deal for the UK, and the vast majority of Members were elected on a platform and a manifesto of obtaining that. I will be tireless in pressing the case for it.

T3. After years of the Scottish National party lobbying, the Department for Business, Energy and Industrial Strategy launched a review into limited partnerships, and we in the SNP welcome that. In the light of the Paradise papers, thousands of firms registered in Scotland will be forced to reveal their owners’ identities. When will the Government publish the full findings of the review? (901624)

At last year’s international anti-corruption summit, we committed to introduce a register of beneficial ownership of overseas companies. We published a call for evidence in April, the responses to which are being analysed. We will publish a response that provides for legislation in due course.

Dieter Helm’s recently published “Cost of Energy Review” says that

“the prices of oil, gas and coal have fallen…contrary to the modelling and forecasting of both the Department of Energy & Climate Change…and the Committee on Climate Change”.

He means that however hard they try and however worthy their intentions, mandarins and regulators are rubbish at discovering or predicting energy prices. Does my right hon. Friend agree that the provisions for the draft Bill’s absolute energy price cap, which would require mandarins and regulators to meet twice a year to pick a number, would repeat the same mistakes so should be replaced by something more closely linked to the few competitive energy prices that already exist?

I know what a great campaigner my hon. Friend has been on this issue. We have published the draft Bill, which includes our intentions, and I hope that he will give evidence while the Bill is being scrutinised. We are eager to hear his views, and we are eager to hear whether the Select Committee agrees with his analysis.

T5. Does the Secretary of State accept that the true test of his industrial strategy will be how actively he and the Government intervene to protect manufacturing skills and jobs when companies such as BAE Systems, Bombardier or Vauxhall face crisis? (901627)

I agree with the hon. Gentleman that the Government, my ministerial team and I should be active in securing investment opportunities and continued employment by UK companies and international companies that invest in the UK, and we are. I do that tirelessly. In the case of Ellesmere Port, we have had discussions with Peugeot and it is interested, as we are, in investment in the new generation of vehicles, with which I know the hon. Gentleman is familiar.

I am working closely on investment in utilities with the Greater Lincolnshire local enterprise partnership, which will shortly publish a report detailing areas of Lincolnshire in which infrastructure requires investment. One problem is that Western Power is prevented from making speculative investment by Ofgem. Can my hon. Friend the Minister tell me why there is apparently this regulatory barrier to investment and what she can do to help?

I commend my hon. Friend and her local enterprise partnership for their work. We look forward to seeing that report and to having productive conversations. We do not want any barriers that impede economic growth in her constituency and region.

T6. Net present value is the economic measurement generally held to provide the most robust assessment of all the costs and benefits of any proposed major infrastructure project. Would the Government ever support a major infrastructure project that, at its inception, was calculated to have a negative net economic benefit? (901628)

One of the things that the House has correctly required of the Government is that we should take account of the impact on local economies—for example, on small businesses. That is something that has changed in the impact guidance, and it is right that it has.

On the 100th anniversary of the communist revolution’s introduction of a system that impoverished and imprisoned tens of millions, what is the Department doing to promote the benefits of free markets for workers, consumers and society as a whole?

I am grateful to my hon. Friend for that question, because the history and reputation of this country during the past 100 years, and especially during the past decade, has been based on having in this country a system of vigorous competition in which businesses compete not because they are guaranteed a position by the state but because they face pressure from competitors. That has introduced extraordinary prosperity that would be thrown away were we to adopt a different system, such as that proposed 100 years ago.

T7. Will the Secretary of State assure the House of his Department’s commitment to enforce the national minimum wage in the maritime sector? Why have officials from his Department been unable to attend meetings of the cross-departmental legal working group on seafarers? (901629)

The hon. Gentleman raises an important point about the national minimum wage and seafarers. We are looking into it and I will write to him with the latest position.

This week is Offshore Wind Week. The wind and renewables sector is vital to my constituency. Many young people are training to secure jobs in the industry, as is being highlighted by the apprenticeships event that will begin here shortly. What ongoing support will the Government give to young people entering the industry?

I am sure that my hon. Friend, like me, celebrates the fact that there has been an unprecedented fall in the price of offshore wind in the most recent auction, proving that the policy making—at least in this case—actually worked. We look forward to further investment in the industry, and are working with the sector on a sector deal that will have to address the issue of skills and apprenticeships. It is a vital industry; there is much more to do and much more growth to come.

T8. Last year, a Whirlpool tumble dryer caused a devastating fire at Shepherd’s Bush Green after Whirlpool told customers that it was safe to continue using them, contrary to advice from the fire brigade. There are still 1 million of these potentially deadly tumble dryers in people’s homes. What does the Minister think about that and what is she doing to ensure that all electrical goods are safe, and recalled if they are not? (901630)

The Government take product safety extremely seriously. We established a working group on product recalls and safety that reported in July, and we will respond shortly. We are already taking action in the areas that have given the hon. Lady cause for concern. Whirlpool has now managed to withdraw or modify more than 2 million of those machines to an unprecedented degree.

The Secretary of State will be aware that Newquay’s bid to be the location of the spaceport is backed by organisations right across Cornwall, including the LEP, the chamber of commerce, the wider business community and the local authority. Will he update the House on what progress has been made in this important development for the UK space sector?

I will indeed. My hon. Friend is a great champion of Newquay’s bid. The shortlisting has taken place and announcements will be made very soon.

T9. The Minister knows that the Red Arrows fly Hawks built at Brough, and they are great ambassadors for British aeronautical engineering and attracting export orders. But with the production line at Brough under threat, including those skilled jobs, is it not time for the Government to renew the contract for Hawks for the Red Arrows and, most importantly, to keep sovereign capability in this country? (901631)

The hon. Lady is a great advocate for this and we discussed this matter during the recent urgent question. We want to do all we can to support the manufacturing future of that entire company, which is why we are focusing so much on trying to help it to get the overseas orders it needs.

When does the Minister plan to respond to the Matthew Taylor review of employment practices in the modern economy?

We are working on our response to the Taylor review’s recommendations now, and we will publish that response before the year’s end.

Imminent changes to the operation of the EU emissions trading system register are likely to invalidate UK-issued carbon allowances from the start of next year. These measures, which have been brought about by Brexit, will have a significant impact on the steel industry. Will the Minister let us know what contingency measures are being taken to mitigate this impact in the event that an agreement cannot be reached with the European Commission on this issue in time?

The hon. Gentleman is right to raise this important issue. He will be reassured to know that there are active conversations going on between my Department and the European Commission. He presents the absolute worst-case scenario, which we are confident that we will not reach.

Thank you, Mr Speaker. The House may be aware that 2017 is likely to be declared one of the top three warmest years on record. With that in mind, it is more important than ever to stick to our carbon commitments. Will the Minister kindly outline what objectives she has for the forthcoming UN climate change conference? Will consolidating our position as global leaders in this area be one of those objectives?

I commend my hon. Friend for her tireless advocacy and leadership in the Conservative Environment Network and for the work she does on behalf of her constituents—Taunton Deane is very lucky. She and I share the aspiration to continue our global leadership role; indeed, the headline objective for the conference is about making everyone aware that there is no rowing back on the Paris agreement—in fact, we want momentum to accelerate. I will be using the conference to announce further investments and further approaches the UK is taking to push our world leadership position forward. If my hon. Friend can just be patient for a few more days, I am sure she will join me in celebrating those when we announce them.

The Committee on Climate Change and a range of respected experts all point out that the existing clean growth strategy will fail on the fifth carbon budget and on the Paris commitments. The Minister must have some additional measures in mind. What are they?

The Committee on Climate Change said this set of policies was one of the most wide-ranging that had ever been put forward. As the hon. Gentleman knows, the budgets end in 10 and 15 years’ time, and we are currently on track to achieve 94% and 93% of the things we need to do, a decade out. I think it is pretty good odds that we will achieve them.