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House of Commons Hansard
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Business, Energy and Industrial Strategy
12 June 2018
Volume 642

The Secretary of State was asked—

Economic Growth and Emissions

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1. What steps he is taking to support economic growth while decreasing emissions. [905777]

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8. What steps he is taking to support economic growth while decreasing emissions. [905786]

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My hon Friends and the House will agree that we should be proud of the UK’s progress in cutting emissions while driving economic growth. Since 1990, we have reduced our greenhouse gas emissions by over 40% while growing the economy by over two thirds—the best performance per capita in the G7. And we will, as part of our modern industrial strategy, continue to exploit the opportunities for future growth across the UK through our clean growth grand challenge.

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As we rightly move towards eliminating the internal combustion engine in all new cars from 2040, does the Minister agree that, in the short to medium term, it is important to jobs and growth that we recognise the role of clean diesel engines such as those in the cars that roll off the production in my local car plant?

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My hon. Friend rightly champions the incredible employer in his constituency. He knows that we are right to move towards eliminating internal combustion engines from our roads, but we must do it in a managed way and ensure that we preserve those jobs and particularly the investment in clean diesel during the transition to zero-emission vehicles. I know that there have been announcements today of job losses in his constituency, which will be concerning. However, they are part of the manufacturing plan that has been announced.

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The oil and gas industry plays an active role in protecting the environment and reducing emissions. Does the Minister share my shock that the shadow Chancellor advised Cambridge University to divest itself of oil and gas investments when that industry supports 300,000 jobs in the UK? Does she agree that the industry is playing its part, and that 300,000 UK jobs are worth protecting despite the Opposition’s—

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Order. I say very gently that the Minister will want to focus on the policy of the Government. Her view about the policy of the Opposition is neither here nor there. With experience, I know the hon. Gentleman will realise that those questions are disorderly.

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The Government’s policy is to support a sector that employs 300,000 people and contributes £21 billion to the UK economy. We recognise that the vital oil and gas industry has an integral role to play as we transition to a low-carbon economy, which is why we are investing in technologies such as carbon capture, usage and storage, and exploring how things such as our world-leading submersible technologies can work to support oil and gas.

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The Minister will be aware of the potential of the marine energy sector in terms of both UK economic growth and reducing emissions. Will she assure me that projects such as Minesto and Morlais in my constituency will not be crowded out by the funding mechanism in place now, which favours offshore wind?

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The hon. Gentleman knows that we have set out £557 million to support all renewable technologies over the next few years. We want to make sure that we decarbonise at the right price for taxpayers and bill payers, which is one reason why the mechanism will continue.

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One way in which the Government could invest in economic growth while decreasing emissions would be to invest in the Swansea Bay tidal lagoon project. They have flip-flopped over the past 10 days, with leaks about when the announcement will or will not be made. May I press the Minister? Can she please tell us when she will deliver that major economic investment for Wales?

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Having grown up on one side of the Bristol channel and seen the second-highest tidal range in the world on an almost daily basis, I will take no lessons on the value of tidal and marine technology. As guardians of public money, it is absolutely right that we make investments that deliver the right decarbonisation and the right value for the taxpayer. The hon. Gentleman should not rely on leaks and assume that they are Government information. That announcement will come in due course and the House will be the first to know.

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Does my right hon. Friend agree that the recent announcement of support for Wylfa underpins the Government’s commitment not only to reducing emissions, but to economic growth, not least in Wales?

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My hon. Friend is right. I should clarify that we are entering commercial negotiations—a deal needs to be done—but we should make a virtue of the fact that we have one of the most diversified energy supplies in the world, and one of the lowest-carbon energy supplies. We have also managed to get ourselves off coal, which other countries long to do.

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The Government’s shambolic policy on the solar and onshore wind sectors in recent years has meant that significant economic growth and decarbonisation opportunities have been lost. For example, we have seen dramatic feed-in tariff subsidy cuts; business and VAT rate hikes; and obstruction to clean power auctions. Sadly, as we have heard today, there are reports that the Swansea Bay tidal lagoon, the world’s first tidal lagoon, which would create thousands of jobs and local supply chains and use 100,000 tonnes of majority British steel, is potentially on the Secretary of State’s hit list. Will the Minister buck that trend today and confirm when the decision will be made, and outline what support she will give to solar and onshore wind?

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I remain bemused by the hon. Lady’s ability to seize a disaster out of a triumph. We have delivered more renewable energy than we ever thought possible, at a price that is unimaginable—[Interruption.] I know the Opposition Front Benchers do not give a stuff about consumer bills, as they have made that totally obvious, but we care about decarbonisation at the right price for the consumer.

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I think we touched a nerve there. The Minister is living in a parallel universe to me, because in the first quarter of 2018 the deployment of new solar slowed to its lowest level since 2010, and next year onshore wind installation is expected to be at its lowest level since before 2008. But it gets worse: last November, the industrial strategy was published, yet seven months on progress has been slow, with business becoming increasingly frustrated. The industrial strategy council has not yet been appointed, no strategy for reaching the research and development target has been published, and dozens of sectors are waiting for responses to their sector deals. So does the Minister accept, as some key business leaders do, that perhaps her Government’s chaos over Brexit and the apparent inability even to concentrate on an industrial strategy are undermining British business and indeed our growth?

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The previous point still stands. We are incredibly proud of our industrial strategy, with its groundbreaking opportunities to link up government and businesses for the first time. I go back to the point on the hon. Lady’s questions about solar: the thing about offshore wind is that we lead—[Interruption.] Again, if they could all stop chuntering, Mr Speaker—God almighty. We lead the world in terms of the installed capacity, and we have created tens of thousands of jobs. I know the Opposition Front Benchers, as per the first question, do not give a stuff about jobs, let alone consumer bills, but the point is that—

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Order. Minister, please resume your seat. I am most grateful to you, but I am afraid dilation is not in order today. We have a lot to get through and not much time in which to do so. We have to make progress. We need short questions and short answers.

Energy Generation and Consumption: Kettering

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2. What estimate he has made of the amount of electricity (a) generated and (b) consumed annually in the borough of Kettering. [905778]

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The last time I talked about dilation, I was in labour. However, in Kettering—

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Order. What is required is a brief answer and a brief question—no dilation.

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In 2016, at least 150 GWh were generated in Kettering, mostly from renewables; this is enough generation to power 38,000 homes. In 2016, 405 GWh of electricity were consumed in the Kettering local authority area.

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It is great news that Kettering is one of the greenest boroughs in the country, but we do have a very large number of wind turbines in the borough. What are the Government doing to encourage offshore wind turbines, rather than onshore ones?

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We have maintained, and will continue to maintain, our manifesto commitment that says that no more large-scale onshore wind development is right in England. That should reassure my hon. Friend and his constituents.

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rose—

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No. This question was purely about Kettering—both the question and the answer—so we must move on.

Food and Drink Sector: South-west

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3. What recent assessment he has made of trends in the level of business investment in the food and drink sector in the south-west. [905779]

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Food and drink grown and made in Cornwall is exported and enjoyed around the world. My hon. Friend, both as chairman of the all-party group on dairy and as North Cornwall’s MP, will welcome the £75 million investment by Dairy Crest in its Davidstow creamery, announced two weeks ago, to expand its cheese production by nearly 50%. We are working closely with the industry to ensure that companies continue to invest and grow, right across the UK.

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I am grateful to the Secretary of State for that answer, and I do welcome Dairy Crest’s recent announcement. The food and drink sector is flourishing right across the south-west, particularly in North Cornwall. We have some fantastic brands, including Tarquin’s Gin, Kernow Chocolate, Sharp’s brewery and Buttermilk fudge, to name but a few. Many of these small and medium-sized firms are looking to export for the first time. What discussions is his Department having with the Department for International Trade in order to expand some of these opportunities for those firms?

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We know that there is huge demand for these products. For example, one reason behind the expansion of the creamery is the increasing appetite in China for cheese produced in Cornwall. My hon. Friend mentioned Sharp’s brewery, and the investment in the facility at Rock now means that 340,000 pints of Doom Bar a day can be produced there. I hope some of those will leave these shores and be enjoyed around the world.

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Controversially, Britain’s earliest pasty recipe comes from Plymouth rather than Cornwall. It dates from 1510 and was found in Plymouth borough’s accounts. Pasties are a key part of both Plymouth and Cornwall’s identity. What discussions has the Minister had to ensure that the name “Cornish pasties” is protected after we leave the EU, preventing anyone else around the world from forging pasties, be they Cornish or from Plymouth?

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Anyone who has enjoyed pasties in Cornwall or, dare I say, Plymouth will attest to their unique qualities. We have products across the United Kingdom that are associated with the places where they are manufactured. It is an association of quality, and we will ensure that they continue to be protected as part of our negotiations.

Automotive Industry

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4. What steps he is taking to support the automotive industry. [905781]

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The automotive sector is one of our great success stories, and our recently published automotive sector deal, as part of the industrial strategy, sets out how we will continue to support it in future. The partnership continues to deliver results. In April, Vauxhall announced an investment of over £100 million in its Luton plant to build the next generation of Vivaro vans. Last month, the Society of Motor Manufacturers and Traders, the sector body, reported that UK van production had increased by almost a fifth compared with last year.

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Jaguar Land Rover is one of Coventry’s biggest employers. Recently, JLR revealed its intention to make Coventry the heart of its large-scale battery and electric vehicle production plans. This is welcome news for my city. With that in mind, what support can the Minister offer to Jaguar Land Rover to ensure that Coventry becomes the centre for large-scale battery and electric vehicle production?

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I am grateful for the hon. Lady’s question and I completely agree with her praise and support for that very important employer. JLR’s expansion plans and its plans to make electric vehicles in Coventry are reinforced by the Faraday challenge, which is part of the industrial strategy, and the national battery manufacturing development facility is based at Warwick University’s campus there to support that company and many others besides.

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Does the Secretary of State agree that it would be a cruel irony if Volkswagen, the author of the emissions cheating scandal, were to make large pay-outs in Germany and the United States, which would help those countries to boost their electric vehicle capacity, but made no similar pay-out to help the United Kingdom move ahead in this area?

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My hon. Friend is right that the consequences have to be borne by the companies that cheated the system. We need to make the transition to ultra low emission vehicles to make sure that we lead the world in this area. Just a few weeks ago, Toyota announced a big investment in the future of mobility here in the UK, based on the commitments that we are making as part of our industrial strategy.

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21. Scrappage schemes have been used in the past to assist businesses and industries in a transition. Has the Minister costed a support package to scrap old diesel vehicles and assist in a managed transition to renewable/alternative energy vehicles? [905800]

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The hon. Gentleman is right that we need to see a managed change. Earlier, my right hon. Friend the Minister for Energy and Clean Growth pointed out that the next generation of diesel can play a big part in not only reducing greenhouse gas emissions, but improving air quality. We will shortly be setting out our proposals on how we make the important transition to zero emissions across our vehicle fleet.

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Hundreds of jobs in my constituency rely on the Jaguar Land Rover supply chain. Will the Secretary of State tell the House what he is doing to help car manufacturers to deal with the uncertainty of Brexit and the fall in demand for diesel vehicles?

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I will. My hon. Friend is right to comment on the supply chain. A big part of the automotive sector deal, which we concluded with the sector, is to boost the proportion of components that are sourced in the UK. This is a joint commitment that we make, as part of the industrial strategy, but she is also right to draw attention to the importance of our continued ability to trade with the rest of the European Union, free of tariffs and with low friction, so that we can maintain the just-in-time model, which is so crucial to our automotive sector.

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Following the loss of the Discovery model to Slovakia, which was a decision at least partly influenced by Brexit, what steps is the Minister taking to head off the risk to Jaguar Land Rover’s exports to China where the rules of origin will conflict with the interests of the company in the event that we lose the customs union and we no longer have sufficient UK content in the cars?

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The right hon. Gentleman is wrong about the decision that was made. In fact, it is a decision to prepare Solihull for the next generation of the Range Rover and the Range Rover Sport. JLR described that as a huge investment and a technology upgrade in Solihull, so I hope he will welcome that. He knows that the importance of making sure that we are able to continue to trade—this includes recognising rules of origin not just with the European Union, but around the world—is vital for this company.

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Many intending to purchase new cars are unsure what type of engine to opt for, partly as a consequence of Government taxation policies. That is having a serious effect on the British motor manufacturing industry. Will the Secretary of State confirm that there remains a future for clean diesel?

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I will indeed. We are not the only country that is seeing a fall in the sales of diesel. As I and my right hon. Friend the Minister of State have said, clean diesel and the new generations of diesel engines have a very important role to play in the transition to ultra low emission vehicles.

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Contrary to what the Secretary of State has said, over the past six months nearly 2,000 job losses have been announced in the UK’s automotive sector. This week in the media we have seen speculation about thousands of further redundancies caused by a combination of factors, including worries about possible consequences of a no deal Brexit and the absence of the customs union. May I press the Secretary of State to set out how the Government will work with business, industry bodies and trade unions to ensure security of the automotive industry and those employed in it both in the immediate future and beyond UK’s exit from the EU?

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We work very closely with the industry with great success. Engine production in this country was up over 17% last year, reaching 1 million engines. That is a record. Never in the history of the British motor industry were more engines produced than last year. Over the past year, the net number of jobs that are being created—note the word “created”—in the automotive sector in this country is 9,000.We have a very good record of working closely with the industry to support an industry that is not only very successful today, but will continue to flourish in the future.

Energy Bills

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5. What steps he is taking to support vulnerable consumers with their energy bills. [905782]

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20. What steps he is taking to tackle rising energy prices. [905799]

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The Government are committed to helping energy consumers. We have brought forward the price cap Bill, and more than 2 million low-income households receive £140 a year through the warm home discount.

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Does the Secretary of State agree that a wide-reaching energy efficiency programme would help vulnerable customers in Eddisbury and elsewhere, as well as helping the UK meet its climate change targets?

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My hon. Friend is absolutely right. One of the missions that the Prime Minister announced as part of our grand challenges in the industrial strategy is to reduce by 50% the energy consumption of homes built in the future. That has an important impact not only on our greenhouse gas emissions, but on the bills that people face.

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With recent rises in fuel costs, many motorists in the Scottish borders feel like they have been taken for a ride. What steps are the Government taking to try to reduce the impact of higher taxation on fuel, and what analysis has the Department carried out on the allegations of rocket and feather pricing on petrol and diesel sales at the pump?

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I am grateful to my hon. Friend for the question. It is a very important market. Obviously, recent oil prices rises have had an impact at the petrol pumps. It is important that prices are competitive and not, as he implies, subject to rising quickly and then taking a long time to decline. The Office of Fair Trading last looked at this in 2013, but I expect its successor, the Competition and Markets Authority, under Andrew Tyrie, a noted consumer champion, to keep this under close review.

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Up to 200,000 customers do not benefit from the warm homes discount because they get their energy from smaller energy suppliers. Is it not time to extend the warm homes discount, especially since energy bills are going up and we are trying to crack down on rip-off tariffs?

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The hon. Lady, Chair of the Business, Energy and Industrial Strategy Committee, makes a very important point. We are reviewing whether the threshold for exclusion is appropriate; I know that she will welcome that.

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Some 169 households in my constituency have been affected by the mis-selling of insulation and solar panels by HELMS. This company was accredited by the Government under the old green deal scheme, so what will the Government do to compensate these people—often vulnerable pensioners—and how will they prevent such mis-selling from happening under the new green deal scheme?

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As with any other supplier, consumer protection rights are in place and available. I would be very happy to meet the hon. Lady to discuss this particular case and see whether we can help.

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Vulnerable customers can benefit from the use of smart meters. Will the Secretary of State update the House on how many SMETS 2 meters have now been installed and are connected to the Data Communications Company?

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I can tell my hon. Friend that 1,000 new SMETS 2 meters have already been installed. That is a significant milestone because it represents the beginning of the roll-out of the next generation of meters.

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As businesses look to expand their market share in the wider evolving world market beyond the EU ahead of next year, what priority are the Government giving to maintaining and trying to reduce energy bills to create employment and prosperity right across the United Kingdom?

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The hon. Gentleman makes an extremely important point. We have commissioned Professor Dieter Helm to look at how we can reduce the costs of our energy system for businesses and consumers. One of the advantages of the strategy that we have pursued is that we have brought down the costs of offshore wind—a major contribution—by targeting and investing substantially in it at a rate, as my the Minister for Energy and Clean Growth, my right hon. Friend the Member for Devizes (Claire Perry) said earlier, which has resulted in a reduction beyond what anyone expected even a couple of years ago.

Sustainable Electricity Generation

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6. What steps he is taking to encourage investment in environmentally sustainable electricity generation. [905783]

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Since 2010, we have seen a large increase in renewables deployment and investment, with more than £52 billion invested, and indeed it is paying off. In 2017, more than half our energy generation came from low-carbon sources. As prices tumble, we can buy more with the same amount of money, which is why we are making £557 million available for further contracts for difference. We have started negotiations with Hitachi to bring forward the country’s second new nuclear plant, which my hon. Friend the Member for Monmouth (David T. C. Davies) mentioned.

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The Minister talks a good talk, but rooftop solar panel take-up is at a seven-year low. In my seat, Alternergy has gone from topping the Fintech 100 to an 80% drop in business since the end of the feed-in tariff was announced in 2012. What assurances does the Minister have for such firms after the scheme closes next year?

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It is right that we look at how we can deliver subsidy-free energy using schemes such as the feed-in tariff that have been wildly successful. I will shortly be launching a call for evidence so that we can come up with a good replacement for the feed-in tariff scheme.

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What was the principal driver in the reduction of the price of new offshore wind?

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There were two things. First was the world-leading contract structure that we set up with our auctions; I pay tribute to that very good coalition policy. The second thing was the enormous deployment globally and the reduction in price of the various components. It has been a great British success story.

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In 2015, the then Secretary of State said that 2018 would be the year for the UK to ratchet up our Paris climate commitments and our progress towards sustainable generation, but in the past three years the Government have capped support for low-carbon energy and destroyed 12,000 solar jobs. Clean energy investment, which fell by 10% in 2016, fell by a further 56% in 2017 to its lowest level in a decade. How about the Minister comes down off cloud complacency and finally gives investors certainty about the renewables industry, starting with a date for the consultation on the post feed-in tariff framework?

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I think that the question in all that preamble was, “What is the date?” As I said, we will be announcing that soon.

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Globally, the nuclear power market is declining rapidly while the low-carbon power of offshore wind and battery storage becomes more affordable. How can the UK Government justify taking a reported £5 billion direct stake, and a further guarantee of £9 billion, in the nuclear white elephant that is Hitachi Wylfa Newydd?

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As I have said repeatedly, we have entered into negotiations. I have to tell the hon. Gentleman that one of the saddest things I saw at the conference of the parties in Bonn this year was the barge-loads of dirty brown coal sailing down the Ruhr because countries like Germany have made an ideological choice about their energy supply rather than focusing on what keeps the lights on, costs down, and carbon falling.

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The Minister said earlier that she “gave a stuff” about household budgets, yet Tory dogma is set to saddle consumers with nuclear energy costing about £80 per megawatt-hour compared with under £60 for offshore wind. Is it not time that the UK Government stopped living in the past, scrapped this nuclear project, and put households, who bear the brunt of costs, front of mind?

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The hon. Gentleman cites numbers that have no relevance to the negotiations. We have to keep bills down, and we have to make sure that the lights are on, that we have a secure energy supply, and that we decarbonise. We think nuclear is very much part of that mix.

Feed-in Tariff Scheme

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7. What his policy is on supporting small and medium-sized renewable power generators after the closure of the feed-in tariff scheme. [905785]

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16. What the timetable is for the publication of the Government’s consultation on the feed-in tariff scheme. [905795]

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The feed-in tariff scheme was launched in 2010 and now delivers £1.5 billion-worth of support a year for low-carbon generation. It has been really successful, and over 6 GW of it has been deployed—2.5% of UK electricity consumption. We want to see how we can deploy it at a subsidy-free level, as that is where prices are going. I will launch a call for evidence on the future of small-scale generation soon.

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Although I was delighted to hear that the world-leading small wind turbine manufacturer in my constituency, Gaia-Wind, was saved from liquidation this week by an overseas buyer, the unnecessary uncertainty that the Government have created around the future of small-scale renewable energy persists. So will the Minister put investors and companies at ease and make a cast-iron promise to bring forward the consultation on future support before the summer recess?

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I am really glad that, as the hon. Gentleman says, it looks as though at least some of the jobs at the company in his constituency have been saved. With these schemes, we always have to think about what is value for money and what is the right thing to do in terms of energy security and supply. I will not make cast-iron guarantees, but I can promise him that it will happen soon.

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Ben Dyson at Lakes Renewables Ltd in Kendal, which focuses on solar power, has seen a 50% reduction in his work due to the impending closure of the scheme. He has kept going by diversifying, but many other firms have gone to the wall. Ben urgently needs policy clarity from next March, and to see business rates on commercial rooftop solar abolished. What steps will the Minister take to ensure that these rates are abolished and that the growth of small green businesses such as Ben’s is encouraged?

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I met representatives of the various trade associations to discuss this really important point. It will be considered separately from the consultation. However, I invite the hon. Gentleman and his constituent to make any representations; I would be keen to receive them.

High Street Businesses

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9. What steps he is taking to support high street businesses. [905787]

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The retail sector is an important part of our economy and our industrial strategy, as are the 3 million jobs employed in it. In March, I established the Retail Sector Council so that retailers can work together with Government to develop policies to support the sector. Last week, the Secretary of State and I held a roundtable in Downing Street with retailers to establish how to tackle the challenges facing the sector.

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As more retailers struggle to survive on our high streets, what discussions has the Minister had with Treasury colleagues to move business rates away from a property-type tax so that high-street retailers can compete on a level playing field with online businesses?

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As my hon. Friend will know, in April 2017, retailers saw a 6% reduction before inflation in their business rates, with £3.6 billion of transitional relief. We are doing what we can to support businesses. The Retail Sector Council will be looking at a range of issues, including business rates. The Government are determined to ensure that the taxation system is up to date and fit for purpose.

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One of the areas on the high street that is particularly struggling is that of our important pubs. I would be interested to hear the Minister’s view on the extent to which pub-owning businesses and tenants enjoy confidence in the Pubs Code Adjudicator—and if they do not, what steps the Government are taking to put that right.

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As the hon. Gentleman will know, I take a particular interest in the health of public houses up and down the country. He will know that this Government set up the Pubs Code Adjudicator to ensure that landlords and tenants across the country got a fair deal. It is still early days, but the adjudicator is getting on and making decisions. I know that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington), is in close discussions with the adjudicator to ensure that he is getting the job done.

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Do the Government feel that there is a level playing field between internet providers and businesses on the high street?

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I congratulate my right hon. Friend on his election to the Select Committee; I am sure he will do a great job in standing up for British business. He highlights a key issue, which is the transition from traditional bricks and mortar to online. Last year alone, we saw a 9% increase in online retail. Clearly that is a challenge for Government and business. That is why we are looking at the business rates structure and also at what we can do to help business to transition during this difficult period.

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The British Retail Consortium has estimated that up to one third of retail jobs could disappear by 2025 as a fundamental transformation of the market occurs. Does the Minister agree that providing retail workers with the opportunity to upskill and reskill is critical to avoiding mass job losses over the next decade?

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I absolutely agree that it is important to ensure that our workforce are properly skilled, which is why that is an important part of our modern industrial strategy, but I am less pessimistic than her. Retail employment has been stable at about 3 million. Yes, those jobs are changing, but retail sales totalled some £362 billion last year, and jobs are being created in the retail sector.

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Last week, House of Fraser announced that 6,000 jobs were at risk. Yesterday, another 5,000 jobs went at Poundworld. Since the start of the year, tens of thousands of retail workers have lost their jobs. Some 3.9 million people work in our retail sector. They, their employers and anyone who cares about our high streets want a retail sector deal, so when are the Government going to publish the strategy? More to the point, will it have any meaningful action?

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I thank the hon. Gentleman for his question. Yesterday I spoke to the chief executives of both House of Fraser and Poundworld to properly understand the challenges that those businesses face and what Government can do to support them. The hon. Gentleman talks about a sector deal. I politely point out that it was this Government who had to take action to bring together the Retail Sector Council, a forum in which to develop policies. While the Labour party sit by and watch, this Government are getting on and working with the retail sector to protect those jobs.

Sirius Minerals Polyhalite Project

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10. If he will make an assessment of the potential contribution of the Sirius Minerals polyhalite project to the industrial strategy. [905788]

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The Sirius Minerals polyhalite project has the potential to create 1,000 skilled jobs at the mine near Whitby and on Teesside, with many more jobs in their supply chains. That is an important type of business that will benefit from our industrial strategy, creating skilled jobs in the north of England.

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I am sure the Minister is aware of the recent Quod report, which shows the long-term economic benefits of this investment. The polyhalite fertiliser mining project does not only bring the 1,000 jobs that the Minister mentioned but is the largest single investment in the north. Product will be exported to the world through Teesport, growing the local economy by almost 20% and adding £2.3 billion to the economy. Does the Minister agree that that is precisely the kind of project that the Government should be getting behind as part of the modern industrial strategy?

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I agree with my right hon. Friend. This is a very important project for him, as the Member of Parliament for Whitby. It is an important developing business, and I agree that it is exactly the kind of business that would benefit from our industrial strategy.

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I worked for some years in the chemical industry, so let us talk in real terms. We are talking about potash, and as one of the biggest reserves of potash in Europe, this business is seriously important. On a day like today, when we face the ruination of Brexit, when my local engineering companies are desperate about losing their markets in Europe and when Ministers are resigning, it is vital that we use this resource to compensate for the disaster in the rest of the economy.

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I agree with the hon. Gentleman; this potash project is very exciting and very good for the UK. It is exactly the kind of business that he would want in his area, and it will help businesses throughout the United Kingdom.

Science, Technology and Innovation Investment

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11. What steps he is taking to invest in science, technology and innovation throughout the UK. [905789]

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18. What steps he is taking to invest in science, technology and innovation throughout the UK. [905797]

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When it comes to science, research and innovation, this Government are putting their money where their mouth is. We are investing an additional £7 billion in research and development funding by 2022—the biggest ever increase in public funding. Our ambition is to increase the UK’s R&D spend to 2.4% of GDP by 2027, which will be an additional £80 billion over the next decade to help us to dominate the new industries of the future.

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The industrial strategy’s commitment to supporting new innovation and investment in science and technology for food production was much welcomed, especially in areas such as North Yorkshire. Will the Minister update the House on what the Government are doing to deliver on these ambitions so that we can fully realise the sector’s potential as a source of high-skill jobs and growing exports?

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My hon. Friend is right to mention agri-tech. As he is aware, we set out in the industrial sector that agri-tech is one of the six priority areas for the artificial intelligence and data economy grand challenge. On progress in what we are doing, we have announced a £90 million transforming food production challenge, which will continue to bring together the UK’s world-class agri-food sector with expertise in robotics, AI and data science.

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In Chelmsford, we are making the sensors that will go on the Sentinel satellites, which will provide a step change in how we monitor our planet’s environment from space. Many European countries have national space programmes and are members of the European Space Agency, Will the UK have a national space programme and contribute to the European Space Agency going forward?

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I can answer categorically: the UK will continue to be a member of the independent European Space Agency—currently, for every £1 we invest, we get £10 back—and Innovate UK is looking at a national space programme with the UK Space Agency. In addition, we are looking at a space sector deal to boost the work in our thriving space sector.

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Some of the most exciting and innovative work in engineering at the moment is being done on the development of renewable energy from wave and tidal stream power. The sector itself has come up with a proposal for innovation in power purchase agreements. Will the Minister, or perhaps some of his colleagues, agree to meet me with a delegation from the sector to discuss how it can contribute to the Government’s industrial strategy?

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Absolutely. I am glad the right hon. Gentleman mentions the industrial strategy, and I would be delighted to meet him.

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rose—

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No mention of Galileo—not one word.

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Order. The hon. Gentleman does not need to keep banging on about Galileo from a sedentary position. We want to hear the views of the hon. Lady, but we have heard the hon. Gentleman chuntering and we may hear him on his feet in due course.

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When looking at investment in science and innovation across the UK, will the Government do what has not been done in recent years, and make sure that the north gets its fair share?

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The hon. Lady mentions the Strength in Places fund—it is actually a big part of our industrial strategy—which is designed to ensure that research and development does not just benefit the so-called golden triangle, but benefits all parts of the UK in terms of jobs and growth.

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Even though telecoms are reserved to Westminster, the UK Government are contributing just £21 million to the Scottish Government’s programme to provide superfast broadband to everyone in Scotland. What representations will the Minister therefore make to the Chancellor about matching the Scottish Government’s whopping £600 million contribution?

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It is for the Scottish Government to make their own budget representations, but as we have always said, we are committed to the roll-out of superfast broadband across the UK. Some 95% of the country has superfast broadband thanks to the work of this Government.

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Science is a great British success story, supporting jobs and growth across the country. With Europe’s funding for UK science down a fifth, more than 6,000 engineers and scientists denied visas in this year alone and universities reporting that Brexit chaos is freezing them out of Europe’s new £90 billion science fund, UK science risks crashing down to earth. Does the Minister accept that his threat to spend the entire UK science budget on duplicating Galileo because the Government have bungled negotiations on this £9 billion UK-EU collaboration is final proof that his science strategy is lost in space?

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As I said, we have the biggest increase in science and innovation in this country for 40 years. As for the UK-EU science collaboration, the EU Commissioner himself said:

“It is very important for the UK and it is very important for the EU to have a relationship in science and innovation. We’ve had this relationship for so long”.

On Galileo, negotiations are under way and we have made it very clear not only that it benefits the UK but that EU member states stand to lose skills and other important issues without the UK’s involvement.

Gas Sector: Scotland

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12. What steps he is taking to support the oil and gas sector in Scotland. [905790]

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This Government have provided unprecedented levels of support to help this incredibly important sector—that is something on which we do agree. The Government announced the transferable tax allowance, the sector’s No. 1 ask; established the Oil and Gas Authority; invested in the Aberdeen city deal, including the excellent £90 million Oil and Gas Technology Centre, which I was pleased to visit; and put together a fiscal package worth £2.3 billion. It is working, with 16 new final investment decisions this year.

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That all sounds very good, but the reality is that in 2016 the Budget measures on support for the oil and gas industry were only a third of the measures on inheritance tax. The measure on transferable tax history has been delayed further, so when will that come forward? Why can the Government find billions and billions of pounds for nuclear but not for the oil and gas sector?

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The hon. Gentleman and I usually talk about the sector in very positive terms. We have delivered the things that the sector has asked for and it is working. It is fantastic to see investment happening in the North sea basin. The fact that the sector has gone through a time of building resilience given the oil price decline means that it is now starting to invest and grow again.

British Steel

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13. What assessment he has made of the capability of British steel manufacturers to produce high-grade steel for new markets. [905791]

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In December 2017 we published Government-commissioned independent research that identified high-value market opportunities for UK steel producers worth up to £3.8 billion a year by 2030

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The national shipbuilding strategy sought to improve UK prosperity through shipbuilding. The MOD fleet solid support ships contract is worth more than £1 billion. What steps will the Government be taking to ensure that British steel manufacturers are ready to bid for that contract?

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As the hon. Lady will know, because I met her the week before last, I am very conscious that Tata is in Port Talbot in her constituency. I promise that I will do everything in my power to ensure that Tata and other British steel companies, all of whom I meet regularly, are poised to act on these contracts.

Carbon Capture and Storage Taskforce

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14. What the timetable is for his receipt of the report of the carbon capture usage and storage cost challenge taskforce; and if he will make a statement. [905793]

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I am delighted to answer this question and continue the conversation about carbon capture and storage that the hon. Gentleman and I were having last night. We are determined to deploy cost-effective carbon capture and storage at scale and in a way that helps to decarbonise both generation and industry. That is why we have asked the taskforce, the best minds in the country, and our CCUS council to convene. I am looking forward to receiving their report and acting on it very soon.

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Does the Minister agree that the development of carbon capture and storage is crucial for much of British manufacturing and for the use of gas during the transition, and will she encourage innovation not just in technology but in finance, with both the Government and the fossil fuel sector contributing?

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The hon. Gentleman might have been reading one of the report’s recommendations. He is absolutely right. We must deliver this in a way that is cost-effective and supports further innovation. I am confident that with the taskforce’s help we will have very good recommendations and ideas to move forward with.

Industrial Strategy

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15. What progress he has made on developing (a) sector deals and (b) local industrial strategies as part of the industrial strategy. [905794]

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Our modern industrial strategy will boost productivity and earning power across the UK. We have announced four sector deals in areas including life sciences, the creative industries, the automotive sector and artificial intelligence. More will come in the weeks ahead. I am encouraged by the work of the mayoral combined authorities and local enterprise partnerships in developing local industrial strategies.

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I and my Front Bench colleagues have been informed that dozens of sectors have put forward proposals for a sector deal, including the steel industry, but have had little or no engagement from the Government. Will the Secretary of State confirm how many proposals for sector deals he has received and to how many he has formally responded?

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I am delighted to report that we have had a huge interest from sectors right across the country, including the steel sector. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington) and I have had substantial discussions with the steel industry and we look forward to developing that deal in the weeks and months ahead.

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What progress is being made on the Greater Grimsby town deal?

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I know this deal is close to my hon. Friend’s heart and that of his constituency neighbour. I have made a commitment to come to Cleethorpes and, I dare say, Grimsby to help with that negotiation. I look forward to doing so soon.

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We can take Question 19, if it is brief.

Tidal Lagoons

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19. What the Government’s policy is on tidal lagoons. [905798]

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The right hon. Gentleman knows, more than many in the House, the need to invest in innovative technologies while maintaining a focus on value for money. We have rightly looked at this project with very serious scrutiny. There are some very attractive things about it, but it has to pass the value for money test. When that decision is made the House will be the first to know.

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Does the Minister accept that nuclear and offshore wind needed pathfinder projects, first-of-a-kind projects, to prove the technology and the economics, and to get the cost down. Why can tidal lagoons not have such a pathfinder project, just as Charles Hendry recommended?

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Partly because of the right hon. Gentleman’s great policy decisions, we have had a world-leading advance in offshore wind in terms of the cost at which we can deploy it. He is right to say that we have to consider the whole life cycle of technologies and that is exactly what we have been doing in considering tidal technology.

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The right hon. Gentleman has been given the accolade of being the source of world leadership in a particular field. I trust, therefore, that he will be gratified with his efforts today.

Topical Questions

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T1. If he will make a statement on his departmental responsibilities. [905802]

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Since our last departmental questions, we have taken further steps to implement our industrial strategy. In early May, we launched UK Research and Innovation, with a budget of £6 billion a year, to drive forward our growing investment in research and development. The Prime Minister announced four missions that our grand challenges will achieve, including to save 20,000 lives a year through artificial intelligence-assisted cancer diagnosis. We have launched sector deals in AI, convened the first ever retail sector council and launched a major programme to drive productivity in smaller companies. On the 150th anniversary of the creation of the TUC, from the party that established the royal commission that decriminalised trade unions, that brought in widows pensions and holiday entitlements, that created the national living wage—in other words, Mr Speaker, the true workers’ party—we wish the TUC a very happy birthday.

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Of course, I say to the Secretary of State that the Labour party was founded by the trade unions.

My question is about retail. In Hull, retail employs 12,000 people. Hull’s House of Fraser store is going to close, with the loss of 207 jobs. Hull has three Poundworld stores that are under threat and there are also concerns about Hull’s Marks and Spencer store, which may be one of the 60 unidentified branches closing by 2022. After the Comet collapse, which cost taxpayers some £45 million, what is the Minister going to do to assist shop workers and protect taxpayers?

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The hon. Lady will concede that the efforts and engagement through the city of culture year between the Government and Hull were very substantial and very effective. I am familiar with the House of Fraser store in Hull. I know what an important part it plays in the life of the town centre. I understand that the council is confident that such a prime site, which I know well, will be taken up. I will work closely with the council to make sure, through the sector council, it has all the help it needs.

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T4. Will my right hon. Friend update the House on what he is doing to support vulnerable people in Mid Dorset and North Poole with their energy bills? [905805]

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Of course, the whole House will shortly be able to pass the price cap Bill, which will assist all consumers with the cost of energy, and this comes on top of the prepayment meter and vulnerable consumers price caps that are in place. We are determined to continue supporting vulnerable consumers through such things as the warm home discount, winter fuel payments and through repurposing the very large energy company obligation scheme to tackle fuel poverty.

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T2. Will the Secretary of State please think of the 150,000 homes that it would power, the thousands of jobs that it would create, the supply chain business that it would support in Wales and the west, and the climate change that it would tackle, and get off the fence and announce Government support for Swansea bay tidal lagoon today? [905803]

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I have always admired the hon. Lady’s passion. Again, as I have said multiple times, we absolutely are very keen to scrutinise this deal. It has to deliver the low carbon energy we all want and the jobs we all want at a price that is affordable for the consumers we all represent.

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T5. Following my Adjournment debate on 4 June, what steps has my right hon. Friend been able to take to progress geothermal energy in Clackmannanshire? [905806]

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Those who missed the Clackmannanshire energy project Adjournment debate missed a massive treat: it was a very enjoyable, informative debate. We are very supportive of the project. My officials are working closely to explore funding opportunities, and I commend my hon. Friend for his continued leadership in this important area.

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T3. Last night I had the pleasure of travelling on the sleeper from Inverness to Euston, and with me on the sleeper was a consignment of delicious highland shellfish products. What are the Government doing to assist the transportation of fresh highland food products to markets in the south and indeed, overseas? [905804]

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As you may well be aware, Mr Speaker, highland products are absolutely excellent and should well be distributed to all parts of the UK. The Government’s policy, with the industrial strategy to develop business by helping with research and development and through keeping fuel prices low, without the troughs and peaks that the Secretary of State mentioned, will help significantly.

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T8. Each year, I organise the Wiltshire Festival of Engineering, and this October’s event is set to reach thousands of young children. What will the Department be organising for this year’s Year of Engineering? [905809]

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The Festival of Engineering is particularly important for students because we want to encourage and inspire people to take engineering subjects and follow engineering careers. A lot of activity is planned and I will be delighted to share this with my hon. Friend.

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T6. With Government support for the third runway at Heathrow coming on top of Crossrail 2, is this not yet another example of infrastructure spending going to the south-east of England? Will the Secretary of State now up the ante and make sure that we get the infrastructure spend to realise the northern powerhouse? [905807]

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We are getting on with major infrastructure investments that would be good for the whole United Kingdom and which the previous Government did not take.

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T9. Like all good films, I hope that a Government response to the Hendry review is “Coming Soon”, but meanwhile, will the Minister share with us whether she agrees that the opportunities for marine energy, whether tidal stream, tidal lagoon or waves, are enormous? Does she agree that they deserve more support and encouragement to develop this fantastically innovative source of additional low carbon, domestically produced energy? [905810]

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I must pay tribute to my hon. Friend’s brilliant chairmanship of the all-party group on this technology area. He is absolutely right: we do think that water power has incredible potential. That is why the Government have invested over £100 million since 2010 in investigating various forms of the technology and why we are keen to continue to pursue opportunities, but they have to be at the right price for consumers.

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T7. What assurances has the Minister received that the British steel industry can supply Heathrow expansion sufficiently? [905808]

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As I hope the hon. Gentleman is aware, I meet the steel industry regularly, and I am very interested to meet him to hear his views on the subject. I can assure him that everything that can possibly be done to deal with tariffs is being done. I had a meeting with all the chief executives of the steel business. I went to Brussels last week and met the director general of trade, as well as other CEOs and European colleagues.

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High street businesses lose out when banks close, pensioners lose banking services, and post offices are also facing challenging times. What can be done to make sure that the main high street banks provide their services at least in a host post office that acts as a hub?

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My hon. Friend, who makes some important points, will know that the Government have invested £2 billion in the post office network to ensure that across the country, in communities where retail banks are closing, the Post Office can step up and allow his constituents and businesses, among others, to access both personal and business banking in their local post office. That is good for the post offices and for our communities.

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T10. Dewsbury town centre is a shadow of its former self and has the second highest rate of vacant units in the country. Will the Minister tell me exactly what the Government are doing to deal with the decline of high streets in northern towns such as mine? [905811]

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The hon. Lady will know that the retail sector is particularly impacted on by changes in consumer behaviour. More people are shopping online, and that is a challenge for the sector. There is no silver bullet, but through the retail sector we are sitting alongside industry and trying to understand the challenges it faces, such as on business rates and how we adapt to ensure that we not only help the sector to make that transition, but protect the jobs of the 3 million people employed in the sector.

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When will the Government respond to the joint report on Carillion by the Business, Energy and Industrial Strategy Committee and the Work and Pensions Committee?

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I thank my hon. Friend for his question and thank the Select Committees for their work on Carillion. They did a truly remarkable job in holding the directors of Carillion to account and uncovering exactly what went on with the Carillion collapse. I think the report was issued on 16 May, and the Government have 60 days in which to respond, but I can assure him that we are doing all we can to meet the challenge.

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Order. We have run out of time so we must have very brief questions. I think a sentence will suffice.

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Factory output has decreased, according to the papers today. Will the Minister outline what he can do to assist factory manufacturing and initiate a clear industrial strategy?

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As the hon. Gentleman knows, through the industrial strategy, which has been developed in close collaboration with the Engineering Employers Federation, and through investment in research and development and skills, we are doing everything we can to take the opportunities arising.

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Given the success of auto-enrolment, will the Minister outline what steps the Department is taking to ensure that as the country saves more, we invest more in British industry?

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The hon. Gentleman will know that through the industrial strategy we are doing all we can to support British business and make sure it gets the investment it needs, particularly through the British Business Bank, which is looking to release £20 billion of patient capital to give our businesses the rocket fuel they need to grow.

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The decision by JLR to invest in electric vehicles is very welcome, but equally the decision to produce the Discovery model in Slovakia is profoundly worrying. Does the Secretary of State agree that it underlines the need for tariff-free access for both cars and components in the EU?

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I agree with what the hon. Gentleman said at the end—of course we need tariff-free access with a minimum of frictions to these important markets—but I disagree that this is not a sign of significant confidence. JLR is investing in the next generation of vehicles. I hope he will welcome that.

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What is the Secretary of State’s No. 1 initiative to ensure that the Greater Grimsby town deal moves from theory to reality?

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As I said to my hon. Friend the Member for Cleethorpes (Martin Vickers), I will come and sit down with Grimsby and Cleethorpes leaders to negotiate it myself.

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There is clearly a crisis on our high street, so will the Minister ensure that business rates are fully addressed in this year’s Budget?

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I can assure the hon. Lady that, together with the retail industry, we are looking at business rates, their impact on businesses and our ability to ensure we have a fair taxation system.

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The industrial strategy challenge fund round closed in April, but the Government are not expected to make a decision until the tail end of this year. Can they speed up the process please?

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We are determined to speed up the process, and obviously we are investing more than ever before, but it is important that we take our time to make the right investments to benefit UK industry.

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Employees in my constituency have time limits imposed on their toilet breaks, which are insufficient. What assessment has the Department made of businesses adopting such practices?

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The Department keeps a close eye on developments of this kind, and I assure the hon. Lady that the matter is firmly on our agenda. We want to ensure, through the Matthew Taylor review and the work we are doing ourselves, that workers are treated fairly, receive the support that they need in business, and are fairly paid.

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One of the biggest missing links in the tackling of money laundering is the Government’s own agency, Companies House. When will the Minister ensure that it is funded adequately and has enough staff to carry out proper checks on businesses?

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I assure the hon. Lady that we are seeking to ensure that Companies House is fit for purpose. As she will know, in 2016-17 it brought some 3,182 prosecutions. Companies House is very attuned to the challenges that it faces, particularly in relation to money laundering. That is why we are introducing, for instance, measures relating to Scottish limited partnerships, which I am sure the hon. Lady will welcome.

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I know that the Secretary of State is an honourable man. He is the Business Secretary. If we have a hard Brexit, British business will be devastated. Will he join us today in voting to keep us in the single market?

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I work night and day to make sure that British and international businesses continue to invest in this country, and they have shown a willingness to do so. We want to be the best location not only for trade with Europe but for trade around the world, and that will form part of our negotiations.

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What support can my constituents, who are among the 5,000 set to lose their jobs at Poundworld, expect from the Government?

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As the hon. Gentleman will know, I spoke to the chief executive of Poundworld yesterday to try to understand the challenges that it faces. Through the official receiver, the special manager is seeking to do everything possible to rescue the business, and they are hopeful that there are buyers out there for at least part of it. We in the Government have pledged to do all that we can to ensure that the business is rescued.