Business, Energy and Industrial Strategy
The Secretary of State was asked—
As we recover from the pandemic, the Government are seizing the opportunity to drive up productivity. We seek to level up the private sector in all parts of the UK.
I recently visited the Financial Planning Corporation in my constituency, whose impressive productivity has enabled it to expand its business. Will the Secretary of State confirm that if bills and taxes go up in the spring, local businesses will continue to operate in a productive environment, free from bureaucracy and unnecessary red tape?
Buying British is a great way for the Government to boost productivity, so why are they buying so many covid tests from China? Many of those tests have only temporary approval from the Medicines and Healthcare products Regulatory Agency and are now banned in the United States. In contrast, the MHRA is delaying approval for British test manufacturers, who have approval and can sell around the world but not here. Surely the Secretary of State is not going to tell us that the MHRA has a different set of standards from those in all other countries. When will he get behind British manufacturers who want to play their part in fixing the shortage of covid tests?
The hon. Gentleman will know that the UK has led the world in life sciences manufacturing. I am delighted that the Under-Secretary of State, my hon. Friend the Member for Mid Norfolk (George Freeman), has taken up the role of life sciences Minister. He has engaged with our manufacturing base, and people look to the UK as an outstanding example of a world-leading life sciences manufacturing nation.
Hospitality Sector: Covid-19 Support
In addition to our £400 billion package, including grants, loans, business rates relief, VAT discounts and the rent moratorium, we are providing a further £1 billion for hospitality businesses and an extra £100 million in discretionary grants—a lifeline for many small businesses.
Great British pubs are the heart of our community, especially in rural constituencies such as mine. I recently hosted a roundtable with several pubs in South West Hertfordshire, at which they expressed their concerns about the next few months after a tough December. Will the Minister confirm that he will do all he can to encourage people to return to their local pub? Will he commend publicans for their hard work making their businesses covid-safe, indoors and out?
I thank my hon. Friend for his support for our pubs. It is important that we save our pubs one pint at a time; they play a crucial role in our high streets, our communities and our wellbeing. I am working, through the hospitality recovery strategy, to champion pubs at the heart of our communities, many of which have been supporting the vulnerable during the pandemic. We will showcase the value of the excellent work of pub landlords to make venues covid-secure, including with good ventilation.
My nightclub in Brighton, Revenge—[Laughter.] It is not mine personally, although I do like to frequent it. It has seen a 60% fall in its patronage because of the latest variant. It is really struggling, but it has been told that it is not eligible for the latest round of grants because it has received previous grants, including the recovery grant. That is a real problem for our night-time economy and for many businesses. Will the Minister confirm that any business in the night-time economy or hospitality sector is eligible for the latest round of grants that he has released?
I thank the hon. Gentleman for his reference to that aptly named nightclub in Brighton. Clearly, opening nightclubs is a big challenge because of ventilation, but they are eligible for discretionary grants: councils have £100 million for discretionary grants to support them.
The café and restaurant owners I met in Basingstoke before Christmas saw their bookings plummet in the key pre-Christmas weeks, so they will really welcome the extra support that the Minister speaks about. The newly recognised personal care sector—hair and beauty—was similarly hit. Will he support that sector as well: the hairdressers, barbers and beauty businesses that make up our high streets?
I support the personal care sector, which I have engaged with regularly over the past few weeks. My right hon. Friend refers to the hospitality sector, cafés and the like. The grants that we are now offering equate to the levels we were offering when those businesses were closed, in recognition of the chilling factor affecting the number of events booked in the lead-up to Christmas—that is the rationale behind it. The care sector can also get discretionary grants from the local authority.
Tory failures on the economy now show all too clearly that the Tories are no longer the party of business. Business taxes and costs are rising, revenues and profits are falling, and businesses face a cliff edge in March as support is withdrawn. Yet when hospitality businesses were losing, on average, £10,000 a week, the Chancellor was in California, with the Business Secretary nowhere to be seen. Does the Minister agree that hospitality businesses, hit hard by covid and Government chaos, need more than the one-off grants finally announced, and will he now back Labour’s calls for the Government to consider extending the VAT discount for hospitality?
This Government continue to be the Government and the party for businesses, and that includes the hard-pressed hospitality sector, which is such a crucial part of the ecosystem of our high streets, our cities, and our coastal and rural areas. The Secretary of State and I spoke to hospitality sector representatives of all kinds within hours of the announcement of the move to plan B ahead of Christmas, and we will continue to support them as best we can.
Science and Innovation: Levelling Up
UK leadership in science, technology and innovation is already driving huge investment in new sectors, companies and clusters throughout the UK, from the Newquay spaceport to the Shetlands, and from Northern Ireland to Teesside, Aberdeen and other life science clusters around the country. However, we intend to go further, and following our innovation nation strategy, we are committed to supporting those clusters. I am engaged in talks with my right hon. Friend the Secretary of State for Levelling Up, Housing and Communities, and details will be provided in the forthcoming levelling up White Paper.
My hon. Friend may know that a leading example of science and innovation as a key tool in achieving levelling up is the Lincoln Science and Innovation Park in my city constituency of Lincoln, which has been headed by the excellent Tom Blount for a number of years. The aptly named Boole Technology Centre, of calculus infamy, has been a great success to date and continues to expand even further, recently attracting notable international tenants and job providers. What financial support can our Government offer, so that organisations such as the Lincoln Science and Innovation Park can continue to grow and nurture companies such as KryptoKloud, and similar new ones can be created?
I congratulate my hon. Friend, who has been a tireless advocate for the Lincoln cluster. He asked about funding. In the comprehensive spending review, we set out the biggest increase in investment in science and innovation for a generation. Specifically, 34 projects in the cluster are funded by UK Research and Innovation. I look forward to discussing this with my hon. Friend, who has made a powerful pitch for that centre to be recognised as a cluster, and I look forward to visiting it.
The University of Sheffield’s new gene therapy innovation and manufacturing centre shows that South Yorkshire can lead the world when it comes to research, but nearly half of all R&D spending goes into the golden triangle. What is the Minister doing to ensure that the north gets its fair share?
That was a great question. The hon. Gentleman is right. In fact, there are several clusters in the Yorkshire area, and in a previous career I myself worked in the Sheffield university cluster, which is very powerful.
Our strategy is that if we wish to be both a global science superpower to attract investment internationally and an innovation nation, we will not achieve that by moving the golden triangle north. What we must do is increase spending in the north, which we are already doing, and grow the supply chains in, for instance, advanced manufacturing. We are not just an invention economy; we are also a manufacturing and innovation economy, and Yorkshire, and Sheffield specifically, have a big part to play in that.
That truly iconic British-built scientific research vessel RRS Sir David Attenborough—built by Cammell Laird of Birkenhead—came up the Thames just before Christmas, at the time of COP26. Does the Minister agree that she is the epitome of all that is best about British science, and that the British Antarctic Survey, through its work in both the Antarctic and the Arctic, leads the world in research on climate change in particular, and in so many other areas of science?
My hon. Friend is right, and he is also a powerful envoy for the Government in terms of our polar science. The royal research ship Sir David Attenborough is something of which all of us in the House can be proud. It is an incredible platform, and it embodies the very best of British leadership in science and innovation, with international scientists working on global challenges.
Yes. We are in the process of establishing the forum, and I want to ensure that we are talking not just to the same old people whom the Government always talk to but to the companies on the frontline—the leaders of the sectors of tomorrow. In the innovation strategy we set out seven high-growth sectors, and I will publish details of that in due course.
New Nuclear Power
Let me pay tribute to those who worked at Hunterston nuclear power station in Scotland, which closed a few days ago. The operators have reported that since the station came online in 1976 it has produced enough zero-carbon electricity to power every home in Scotland for nearly 31 years.
Looking ahead, the Government have announced a £120 million future nuclear enabling fund to support new nuclear and we are aiming for a final investment decision on at least one more large-scale nuclear project during this Parliament, subject to value for money and relevant approvals.
What a shame that the Scottish National party is not pressing for a replacement of that old girl, who has given fantastic service over the years. Will the Minister reassure me that he sees nuclear as a way of not only replacing electricity capacity but producing the hydrogen we will need to power the heavy vehicles—the buses and trucks—of the future?
I thank my right hon. Friend for that further question, and I totally agree with him on where the SNP is. On energy in general, SNP Members are not the friends of Scotland on nuclear or the North sea. He is also absolutely right on hydrogen. On the Government Benches we recognise that net zero needs nuclear for security of supply, to meet our decarbonisation targets and to support new industries such as hydrogen.
When it comes to new nuclear, there is not a single successful EPR plan operational anywhere in the world. The regulated asset base—RAB—model has not been shown to work for new nuclear, so why does the Minister think that it is a good investment of £63 billion of bill payers’ money to sign up for Sizewell C when it is just going to be another white elephant?
I repeat my disappointment. Scotland has an amazing nuclear past and I would like it to have a very good nuclear future, but unfortunately the Scottish Government stand in the way. This country needs nuclear, and net zero needs nuclear. Hinkley is being built, and we are very confident of the numbers and of building new nuclear power stations in this country. That is what the Nuclear Energy (Financing) Bill—which secured its Third Reading yesterday with the support of the official Opposition but not of the SNP or the Lib Dems—is all about.
I absolutely accept that invitation. There is no more passionate an advocate of new nuclear in this House than my hon. Friend. Nuclear is going to be a vital part of our future. The UN Economic Commission for Europe recently said that international climate objectives would not be met if nuclear power were excluded, so it is a key part of our net-zero ambitions.
I was disappointed that, in his reply, the Minister did not refer to small modular nuclear reactors, which surely are the future in this sector. Can we take the lesson from the vaccine taskforce that rigorous scientific methods can be combined with speeding up the process and cutting out dead time? Can he convey that message to the regulators so that this world-beating technology can be built in Britain to the benefit of British industry and British workers?
I absolutely share the right hon. Gentleman’s enthusiasm for SMRs. At the end of last year, the Secretary of State announced funding for SMRs of £250 million, working with Rolls-Royce and with the best of British industry and innovation on SMRs. I recently had a meeting with Sheffield MPs as well, where we talked about Sheffield’s potential to host SMRs, along with other sites. SMRs are very much part of our nuclear future.
Is the Minister aware that my constituency is on the frontline of the SNP Scottish Government’s dogmatic opposition to new nuclear power stations? For over 50 years, the Chapelcross power station near Annan provided much-needed jobs and a huge boost to the local economy, yet despite public support we cannot have Chapelcross 2 because the SNP is blocking it.
My right hon. Friend has been a passionate defender of Scotland’s interests since he and I were first elected in 2005, and he is absolutely right. The SNP has a nonsensical policy towards energy in Scotland in general, and towards nuclear in particular. There is a great civil nuclear heritage in Scotland which the SNP has betrayed. I wholly agree with my right hon. Friend.
Flood Recovery Support
The flood recovery framework is in place to determine where communities and businesses need support from central Government in severe flood events. The guidance has recently been reviewed and refreshed, to learn from previous years. The framework includes the business recovery grant, which BEIS administers as part of a Government core package of support for communities and businesses.
Flooding is now inevitable: climate change means that it is going to happen. It is not a question of if but a question of when, and small and medium-sized enterprises are disproportionately affected by the devastation of flooding. The Flood Re insurance scheme does not cover small businesses, meaning that many are left without insurance. I am pleased to hear that the flood recovery grant system is being looked at again, but will the Minister now consider talking to SMEs to design a scheme that is ready to go from the moment flooding happens? As I say, flooding is not a question of if but a question of when.
The Flood Re scheme does not include businesses, as the hon. Lady says, and there are no plans to extend eligibility because that market operates differently from the household insurance market. The scheme is bespoke. I appreciate that SMEs are disproportionately affected compared with bigger businesses, but I suggest that the hon. Lady engages directly on this with the Department for Environment, Food and Rural Affairs.
Will the Minister look at the opportunities to manage Britain’s longest river, the River Severn? We believe that, if an holistic solution were found to managing Britain’s longest river, there would be a gross value added uplift in the west midlands of more than £150 billion. These figures are being presented to DEFRA. Will he and his Department also take an interest and work with me, as chairman of the all-party parliamentary group on the River Severn Partnership, on trying to find a solution to managing Britain’s longest river?
It is important not to wait until flooding happens, as we have heard, but to manage it actively. Organisations such as Living With Water in the constituency of the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) have done very good things in proactively tackling flooding.
Again, I suggest that my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) works with DEFRA. I am happy to see what more I can do in that regard.
BEIS and the Department for Digital, Culture, Media and Sport sponsor the hospitality and entertainment sectors, both of which support the night-time economy. Alongside the £400 billion package of grants, loans, business rates relief, VAT discounts and rent moratoriums, we are providing £1 billion-worth of grants and £100 million-worth of discretionary grants.
Although the night-time economy has clearly been thriving in Whitehall, especially at the height of lockdown, many bars, clubs and pubs across the rest of London are unfortunately struggling to stay afloat, and many of them employee my constituents. The Night Time Industries Association suggests that its members have lost, on average, £45,000 over the festive period, so the grants do not touch the sides. Will the Minister commit to providing further financial support to this sector by reintroducing the 100% business rates relief and the emergency 5% VAT rate?
The business rates relief and VAT relief continue, but the grants the Chancellor has offered equate to the grants we previously offered when the same businesses were mandated to close, in recognition of the chilling effect. Clearly we will continue to work with the hospitality sector, which wants to stay open and trade normally. That is why we are learning to live with covid, in contrast with, for example, Labour-run Wales, where the hospitality sector has remained hampered by further restrictions.
I welcome all the support the Government have given to businesses and all the work the Minister has done personally in this area. However, hospitality and the night-time economy in Bexleyheath town centre still face real challenges with staffing as well as finance. Will my hon. Friend continue to meet representatives of these sectors to take their views on board and see what more can be done, particularly on staffing?
I absolutely agree with my right hon. Friend. Interestingly, we now have 400,000 more people in work than before the pandemic, which is testament to the plan for jobs and the plan for growth, but we need to address the record number of vacancies. We need to match them with the people in work who want to work more hours, and we will do that between the Department for Work and Pensions and my work in BEIS. There will be a cross-Government approach to make sure hospitality can thrive.
The Minister knows that Newcastle’s night-time economy is absolutely core to our city’s appeal and character. But we know that businesses in the night-time economy have accrued massive debts during this period. They are struggling with the continued uncertainty that omicron is bringing. We know that the night-time economy—our nightlife—is what makes Newcastle great and discretionary grants are welcome, but we know that some areas are impacted worse than others and have less discretionary ability to spend that on the night-time economy. So, will the Minister look at specific, targeted support for that sector, for those areas that really need it?
We are trying make sure that the cities can open in full. That is a return to work, a return for students, a return to domestic travel, and a return to international travel. All those people contribute to that ecosystem of hospitality, and indeed the night-time economy, so cities have a particular view that we need to approach. We will continue to flex and work with businesses as they open up fully to pay down their debt and to trade as normally as possible to ensure that the hospitality sector—the night-time economy—can thrive in Newcastle.
Off-grid Homes: Emissions
I would like to reassure my hon. Friend that if we look back at where we were this time last year, we came out with the heat and buildings strategy, which directly answered this question, and also a very generous comprehensive spending review settlement.
I thank the Secretary of State for his answer. In Sevenoaks we are keen to play our part in achieving net zero, but many of my constituents in more rural areas are worried about the costs and feasibility of replacing their oil boilers as they are phased out. Can the Secretary of State provide reassurances to them, and all in a similar position, that safeguards will be put in place to ensure that alternatives are affordable and practical?
Very specifically in regard to her question, my hon. Friend will know that there is a £450 million boiler upgrade scheme, which was outlined in the CSR, that will provide up-front capital grants for the installation of low-carbon heating systems. She will also be aware that for lower-income households we have a £1.1 billion home upgrade grant, which will upgrade energy efficiency and increase low-carbon heating of non-gas homes across the country.
I am sure that the Secretary of State is aware that off-grid customers’ gas and oil supplies are not covered by the price cap, and that they will therefore experience even higher price fuel price increases this spring than the £600 or so now predicted for on-grid customers. Is the Secretary of State intending to provide any special assistance to off-grid customers, or is he going to let them stew alongside their on-grid neighbours, as the Government seem happy to do at the moment?
I think that is a complete misrepresentation of all the work that the Government have done to help customers. There are the winter fuel payments, as the hon Gentleman well knows, and £300 for 8 million pensioners is worth £2 billion. We have the warm home discount, we have cold weather payments. We have a full range of measures that will help off-grid customers in a difficult time.
As a result of this Government’s long-term life science strategy, now a 10-year strategy, I am delighted to be able to share with the House that the life science sector has grown, in terms of private investment, by 1,000% in the last 10 years and is creating jobs all around the UK—in Northern Ireland, Scotland, Wales. At the heart of our strategy for the innovation nation, in our life science vision last summer we set out a plan, with £5 billion in the comprehensive spending review of funding for life science research, and we intend to support those clusters all around the UK.
I welcome the effort that my hon. Friend has given to developing this important policy and his characteristic kindness in engaging with me on it. Clusters will be crucial to improving UK resilience and building our manufacturing capacity. In Ulverston we have an established base with GSK, but I want to see that grow, with new entrants like Lakes BioScience coming in, building high-skilled jobs and the supply chain. With that in mind, may I ask how the strategy will apply to south Cumbria? May I also invite him to the sunlit uplands of Ulverston to visit and see for himself?
I thank my hon. Friend and pay tribute to his tireless campaigning for Barrow and Furness and on this issue. I understand well the concerns following GSK’s movement from the Ulverston site. I would just make this point: quite often such moves of pharma from one site to another create an opportunity. As the Minister for Life Sciences, I launched the life science opportunity zones and we created thriving clusters at Alderley Park and Sandwich; it would be my ambition to do the same up at Ulverston. I very much look forward to coming up and visiting, and my officials are working closely on that as we speak.
Central Park in my constituency is furthering Darlington’s ingenious spirit as it drives forward UK life sciences, with firms on our golden mile creating and developing the medicines of the future, as the Secretary of State knows from his recent visit. Will my hon. Friend outline what steps his Department is taking to ensure that firms in Darlington use local talent in the pursuit of further scientific breakthroughs?
My hon. Friend makes an important point about talent and is right that a powerful cluster is taking shape in the north-east. Following my return to the Government two months ago, my first visit was to the north-east. From Darlington to North of Tyne, an incredible cluster is taking shape, with the National Biologics Manufacturing Centre, the Centre for Process Innovation and the National Horizons Centre all in that golden mile in Darlington. It is an incredibly exciting time and I look forward to going back up to see my hon. Friend’s constituency and how we can develop a skills plan so that the sector can grow in the next five to 10 years.
In his earlier answer, the Minister alluded to co-operation among the various parts of the United Kingdom; will he ensure that there is maximum co-operation so that sites such as the centre for drug discovery, which is linked to the life sciences faculty at the Coleraine campus in my constituency, can maximise their opportunities?
I am grateful to the hon. Gentleman for raising that issue. With Queen’s University Belfast and the Randox cluster, Northern Ireland is a powerhouse in life sciences and both the Secretary of State and I have been to visit. I am delighted that the hon. Gentleman has made that point and will make sure that the Northern Ireland cluster is powerfully at the heart of our innovation strategy.
In York, we want to maintain momentum around the BioYorkshire project—York’s green new deal—so will the Minister set out when the project can apply for funding under the Biotechnology and Biological Sciences Research Council funding regime?
I have had meetings with the hon. Member since she raised this issue previously. We are in the process of allocating—I repeat—the biggest ever increase in science and innovation funding for a generation. Once that process has been completed, we will begin to allocate the money throughout the country. The hon. Member has made a powerful intervention on behalf of that cluster, which I am going to come up to see. There is an exciting cluster of companies in the York, Harrogate and east of Yorkshire area.
The Minister is absolutely right about the overall success of the Government’s life sciences strategy, but he will be aware of the chilling effect on UK manufacturers, including one in my constituency, of the outcomes of the coronavirus test device approval process. I know the Minister is a believer in agile regulation, so will he conduct a review, with the UK Health Security Agency, to understand what lessons can be learned to assist UK manufacturers in future?
As per usual, my hon. Friend makes an important point. I am not the Minister responsible for the vaccine taskforce, but I am already reaching out to my colleagues at the Department of Health and Social Care on that very point to make sure that in the light of this pandemic we boost our manufacturing centre as well as our research.
British life scientists led the world in the battle against covid, and we need them to lead the fight against another great health challenge: dementia, which destroys so many lives and imposes huge private and public health and social care costs. This month, research published in The Lancet found that by 2050 worldwide dementia cases will treble and cases will go up by 75% in the UK. That is why Labour is promising to double research and development spend on dementia—a commitment that was also in the 2019 Conservative manifesto. Will the Minister confirm that dementia R&D spend has gone down since his Government took office?
I agree with the hon. Lady that that the dementia research and treatment sector is incredibly important, which is why, when then Prime Minister Cameron set up the G20 summit, I was incredibly proud, as Minister for Life Sciences, to launch the UK Dementia Research Institute. In the CSR, we announced another £340 million for motor neurone disease research. As I say, I am in the process of allocating the biggest ever R&D increase and we will look to make sure—[Interruption.] The hon. Lady is heckling me from a sedentary position; perhaps she will listen. We are in the process of allocating that money to make sure that dementia gets the recognition that it needs.
To ensure that our fantastic life science sector continues to prosper and lead the world, we need to inspire the next generation of life scientists. What more can the Minister’s Department do to show that there is a place for everyone in the sector, regardless of race, background or gender, and that their future efforts could change lives both at home and abroad and tackle some of the great challenges that we know exist.
Not surprisingly, my hon. Friend, who is an expert in this field, makes an important point. In the people and culture strategy that we set out this summer, we make that very point: we need to build a diverse eco-system. I have already reached out to the Royal Society and picked up and commended its work on science, technology, engineering and maths and diversity in the sciences. The truth is that our science sector is creating opportunities all around the country, and we are absolutely committed in the innovation strategy to make sure that every community in this country has access to those jobs and opportunities.
Scottish Businesses: UK Government
Business Ministers regularly engage Scottish businesses on policy making and to discuss business-related issues. In challenging times, the UK Government have provided significant taxpayer support to businesses across the UK, including in Scotland, and we will continue to work with them in the months ahead.
Just last week, the Federation of Small Businesses flagged up the grim realities of Brexit, citing that 74% have experienced a sharp fall in international sales and exports because of import checks on trade with the EU, yet that reality is completely at odds with the outpourings of Lord Frost who used the new year honours list to purport an opaquely upbeat metric on the success of businesses across these isles. How are Scottish businesses supposed to feel any shred of confidence in this Government when such comments are completely at odds with what is happening on the ground? Even Baroness Davidson, the face of the Scottish Tories for the past decade, says that
“I despair when I see people—even those of my own party—dismissing business or disrespecting the herculean efforts that people have gone to”.—[Official Report, House of Lords, 9 December 2021; Vol. 816, c. 2021.]
I know that this is a surprise to the Scottish nationalists, but we have made the decision as a country to leave the European Union, and we are now in the process of ensuring that that is a success, not just for businesses in Scotland, but for businesses all across the United Kingdom as a whole, and we will continue to do that in the months ahead.
Given that shops in Scotland had a greater reduction in footfall than any other part of the UK, given that the Scottish Licensed Trade Association has called the additional restrictions in Scotland a “knock-out blow”, given that the Aberdeen and Grampian chamber of commerce has called on the Scottish Government to pay up or open up, and given the abandonment of the Scottish oil and gas sector and its workforce, will my hon. Friend be able to give an assessment of Scottish businesses’ confidence in the Scottish Government?
I am grateful to my hon. Friend for his apposite and very important intervention this morning. He is a huge and doughty campaigner for Scottish interests, unlike individuals on the SNP Benches. It is comments such as those from the Aberdeenshire chamber of commerce that demonstrate how the confidence of Scottish businesses should be in the UK Government rather than the Scottish Government.
Baglan Energy Park
I am grateful to the hon. Gentleman for his question and for raising this issue. I know that this has been a challenging time for some tenants on the energy park. Given that these issues are largely devolved, officials from the Department for Business, Energy and Industrial Strategy and I are regularly in touch with the Welsh Government on this matter and this includes, as he is aware, an exchange of correspondence in the past few days, along with regular meetings between officials.
The Minister knows that in just three days the official receiver is due to turn off the power on the Baglan energy park. The intransigence of the official receiver is putting huge pressure on local businesses and also creating massive environmental and public health risks. Section 400 of the Insolvency Act 1986 clearly gives the Business Secretary the power to direct the official receiver. Why will the Minister not step up, take urgent action and direct the official receiver so that the potentially catastrophic consequences for these businesses, houses and communities can be averted in just three days?
As I have said, I completely appreciate that this is a challenging time for tenants on the energy park. We have, as a UK Government, sought to review all of the powers that are available to the Government, including section 400 of the Insolvency Act. It is our view that it is not advisable to use that process at this stage. We have, as the hon. Gentleman knows, written to the Welsh Government giving a number of indicators about how we can mitigate the challenges and I look forward to speaking with the Welsh Government further, including in my meeting with the Minister for the Economy tomorrow.
Energy Transition Projects
May I start by welcoming the hon. Gentleman back to his place?
The Government support the energy transition by harnessing the industry’s existing potential to exploit new and emerging green technologies. As regards Scotland, we have a £20 million pot for tidal stream. The Acorn project has been allocated £40 million in carbon capture, usage and storage development funding so far, and in the hon. Gentleman’s own area, the Ayrshire growth deal has secured investment of £251 million, including up to £18 million for a centre for research and a low-carbon energy and circular economy.
I thank the Minister for his response and his kind wishes. The UK Government have decided not to rethink and reverse their decision not to fund the carbon capture, utilisation and storage facility at St Fergus, and the Chancellor has failed to match the Scottish Government’s £500 million investment in a just transition fund for the north-east and Moray. By deploying CCUS, hydrogen and direct air capture technology in Scotland, the Scottish cluster would support an average of 15,100 jobs between 2022 and 2050. Do major Scottish projects only have priority in the months ahead of an independence referendum?
The hon. Gentleman will not be surprised to hear that I disagree with him on the independence referendum, but we engage regularly with the Scottish cluster and Acorn, and I met Storegga before Christmas. I have also met with my hon. Friend the Member for Banff and Buchan (David Duguid), the MP for St Fergus, and have been to his constituency recently. Just to be absolutely clear, the Scottish cluster is the reserve cluster, which means that it met the eligibility criteria and performed to a good standard in the evaluation criteria. We also recently published our track 2 update for CCUS, which highlights our increased ambition of capturing and storing 20 to 30 megatonnes per annum by 2030. I think there is a great future there for the Scottish cluster.
I welcome the hon. Member for Ayr, Carrick and Cumnock (Allan Dorans) back to his place—even though he did kind of trample over my question a little bit. Will my right hon. Friend confirm the UK Government’s support for the oil and gas sector and its vital role in driving the energy transition to net zero? As part of that support, will he confirm what recent engagement he has had with the Acorn CCS project in my constituency of Banff and Buchan on its role as the first reserve cluster?
As I have mentioned, I met with Storegga before Christmas, and my hon. Friend and I also talked about this in his constituency in early December. I am looking forward to further engagement with the cluster. I also agree with what he said about oil and gas. We have a North sea transition deal, and the important thing is transition. It would be mad, particularly at this time of elevated gas prices, to do anything to close down the North sea, and it is not our objective to do so. Therefore, we should stick to the transition deal, support our key oil and gas sector in the North sea and absolutely reject a lot of the politics coming out of the SNP, which has turned to be anti-North sea, which is not holding Scotland’s best interests at heart.
Of course, it is not just on carbon capture underground storage where the UK Government have betrayed Scotland’s interests. As the Minister will be acutely aware, Scottish renewables projects continue to pay the highest level of grid charging anywhere in the entirety of Europe. Indeed, I was speaking to an operator just recently who told me that over the lifespan of his project, he anticipates that it will pay £1 billion in grid charging; meantime, a project in East Anglia will not pay a single penny. Is that a Union of equals?
I am always pleased to take a question from the SNP Front Bench, although I notice that the hon. Gentleman did not say anything about nuclear, the North sea transition deal or the recent announcement of a £20 million funding pot for tidal. He did mention transition charges. He will know that Ofgem recognises the importance of transition charging arrangements, which is why it is currently considering responses to its call for evidence on transition charging reform. That is already being covered, but I would like to hear from the hon. Gentleman—he may have another question—that he is going to change his mind on nuclear and supporting the North sea transition deal.
Of course, the Minister’s continual deflection to Ofgem fails to meet the needs of businesses in Scotland. He will also be acutely aware that under the Energy Act 2004—section 185, I believe it is—he could take action to change the status quo, but he chooses not to, and the reason is quite clear. The National Grid is clear that in a couple of years Scottish projects will pay £465 million into the grid, while projects in England and Wales will cumulatively get a subsidy of £30 million—a renewables robbery in plain sight. Is it not the case that while Scotland has the energy as part of this United Kingdom, it does not have the power?
I am not sure quite how to respond to that, but I remind the hon. Gentleman that there is a call for evidence on this and we are awaiting the responses to that call. Once again, I remind him of the support being given by the UK Government to renewables in Scotland: the £20 million tidal pot; the quadrupling of offshore wind capacity across the UK over the next decade; support for CCUS—all these things. It is about time he had a word with his party colleagues back in Edinburgh and got them to have a sensible energy policy when it comes to both the North sea and nuclear before he comes here and lectures us.
The steel industry plays a vital role in our economy. Through the Steel Council and regular engagements with steel industry, the Government are working with the sector to develop a plan to support its transition to a competitive, sustainable and low-carbon future.
For UK steelmakers, paying 61% more than their German competitors for industrial energy is not only a barrier to investment but a direct barrier to decarbonisation, with the future of this foundation sector being fundamental to our net zero ambitions, so when will Ministers commit to providing Government support to bridge the electricity price gap?
As the hon. Lady will know, because we have talked about it in other debates, the Government continue to look at options on this. We have very regular engagement and interaction with the steel industry, including the Steel Council, and other meetings, including ones just in the last few days. It is important to note the extensive support and help that has been given to energy-intensive industries, including the steel sector, since 2013 and beyond.
I thank my hon. Friend for work that he has done for steel. He will know that the Prime Minister himself has stood in this Chamber and spoken about the unfair historical energy costs that steel industries have faced in this country. What conversations need to take place between BEIS, the Treasury and No. 10 to bring forward a solution so that my world-class steelmakers can get on a fair footing?
My hon. Friend is an absolute champion for her constituents in Scunthorpe and for the continuing success of the steel industry in that area. We continue to work very closely with our colleagues across Government to determine how we can provide support and look at options around the temporary issues that have been caused in the past year or so and then the longer-term issues. I would be happy to talk to her further.
Before we proceed, I think it is fitting and right to say that I was desperately sad to hear that the hon. Member for Erdington had passed away last week. It is particularly ironic in that he was on the original draft of today’s Order Paper, fighting for his constituents as a dedicated public servant who always took a keen interest in the work of our Department.
I know that households and businesses are deeply concerned about the effect of rising energy prices across the next few months. We already provide £4.2 billion-worth of support for the most vulnerable. I am working closely, as many people know, with energy companies, Ofgem and ministerial colleagues across the Government to mitigate the impact of further price rises.
May I echo the sentiments in regards to my late good friend and fellow trade unionist, the Member for Erdington?
Energy-intensive industries such as Tata Chemicals in my patch, and the Daresbury labs on the Sci-Tech site that the Secretary of State will be familiar with, need support and they need it now. Why does he not swallow his pride, support the windfall tax that Labour is proposing, plus the VAT measures, and help companies such as Tata and indeed British Steel?
My understanding of the Labour proposal—I might have got it wrong—was that the windfall tax would not be directed to companies; it was, as I read it, directed to consumers. He will know that I, as Secretary of State, have always engaged with energy-intensive users and companies, and I am looking at the moment to try to get a solution to this problem with colleagues across Government.
As my hon. Friend knows, a decision has not yet been taken on the outcome of the timetable consultation. Transport connectivity is largely an issue for other Departments, none the less we appreciate the importance of connectivity and infrastructure. We know that my hon. Friend will be an absolute champion of that—he has done a huge amount in his short time in this location.
I welcome the tribute that the Secretary of State just paid to our friend Jack Dromey, who was a great champion of British industry and of British workers and simply an all-round great man.
Over the last decade, Conservative Ministers cancelled the zero-carbon homes programme, banned onshore wind development, launched the eco-insulation programme and tore it up within one year. They reduced the UK’s gas storage capacity and at one particularly silly moment, the current Foreign Secretary claimed that solar panels were a risk to domestic food production. All those decisions have made this country more dependent on volatile wholesale energy prices than we otherwise would be. We know that means that there is an extremely difficult situation for British households, but it also risks making large swathes of British industry uncompetitive. The Secretary of State says that he is working hard, so what is his plan?
I am delighted to see the hon. Gentleman take his place. I remember him being a prominent member of the economic team under the right hon. Member for Islington North (Jeremy Corbyn). I am glad to see that there is life after death and that he is here today. My only regret is that the right hon. Member for Doncaster North (Edward Miliband) is not here. I am afraid that the split of net zero from business shows that Labour is not serious about the energy crisis. It is not serious about placing net zero in the context of business and growth and it is completely off the pace in terms of driving clean—
Order. I call Jonathan Reynolds. [Interruption.] Sorry, sit down and I will just explain once again. These are topical questions. They are not meant to have a “War and Peace” answer. I want to get Back Benchers on both sides of the House in. You are taking their time.
There was a lot of talk from the Secretary of State, but no answer. However, let us take up the point that he made. Earlier, one of his Ministers gave me an answer about UK steel production. The Secretary of State talks about net zero, but that cannot be achieved by exporting UK industry and jobs. We have pledged £3 billion of investment in steel, which would match fund pilots in hydrogen in place of coal and joint fund investment in electric arc furnaces. Domestic steel is essential to net zero; it is relevant to levelling up because it provides the jobs and the wages in many parts of the country; and it relates to Brexit because our producers now pay higher tariffs than companies in the EU to export to the US. Net zero, levelling up and Brexit amount to the Government’s entire agenda, so Secretary of State, again—
I am happy to meet my right hon. Friend and potentially the company, but let us be absolutely clear: the issue with gas is not supply or storage, but price. Storing more expensive gas would not lower the cost of gas. We have excellent security of supply in this country—50% from our continental shelf and 30% from Norway. The issue is very much price, not storage.
The hon. Lady will know that I have extensive conversations with my right hon. Friend the Chancellor about that very issue. That is why we have kept to the energy price cap, increased the warm homes discount and got a winter fuel payment. The issue is squarely at the heart of our concerns as a Government.
This party of business will not let businesses sink or swim. We will continue to engage with businesses around the regions and around the sectors to understand exactly where they need to change and to help them in their transition.
I point out to the Secretary of State that HSBC, a British-registered bank, is being reported as having invested in Xinjiang Tianye, which is a subsidiary of Xinjiang Production and Construction Corps, which has been sanctioned by our allies the United States for committing atrocity crimes, including slave labour and genocide. Will he call in the bank and ask it to explain itself, as it is in breach of the modern-day slavery rules?
My right hon. Friend raises a very serious point. Clearly, HSBC’s dealings with China are of commercial interest to it, but those dealings also have a wider implication. He will know from his experience that the Treasury has direct ownership of that relationship; I am discussing it with my right hon. Friend the Chancellor of the Exchequer.
At more than 2,000 acres, the Manor Farm solar park proposed for Rutland, the smallest county in England, is eight times larger than the existing solar plant. Can the Minister reassure me that when it lands on his desk, he will listen to the voice of Rutlanders and ensure proper scrutiny to protect our agricultural land and outstanding local biodiversity?
We always listen to Rutlanders and to my excellent hon. Friend who represents them. I very much agree that we want to bring communities with us when it comes to all renewables, but I think she knows that I cannot comment further at this stage. She can reassure her residents that she has been heard.
The Treasury has benefited hugely from the miners pension surplus over the years. Even though the Prime Minister pledged in the 2019 election that no miner would be left behind and out of pocket, they have been. Will the Government look again at giving miners their fair share or is that another example of the Prime Minister saying one thing and doing another?
The success of the current pension arrangements means that a pensioner in the scheme is 33% better off than they would be in a normal pension scheme. We continue to believe that the arrangements agreed in 1994 with the scheme’s trustees work well and are fair and beneficial to scheme members and taxpayers.
Regional mutual banks are key to the success of small and medium-sized enterprises in the world’s most productive economies, including Germany and the USA. Will my right hon. Friend meet me to discuss that important opportunity?
For the last two months, people in Eccles in my constituency have had to wait weeks and weeks for their mail. Postal delays have meant people missing urgent hospital appointments, not receiving prescriptions and suffering hardship after not receiving their bank cards. It is unacceptable that Royal Mail has done so little to fix this problem. This appalling level of service is causing harm to my constituents. Will the Minister take action to ensure that Royal Mail resolves these letter delays?
I know that Royal Mail responded directly to the hon. Lady’s concerns in December 2021, and I responded just yesterday. However, I will continue to look at this, because covid sickness absences still remain, and Royal Mail is rotating deliveries so that its customers receive their mail as frequently as possible. There is clearly more that we can do, and I will ensure that we monitor that as best we can.
We all know the challenges those in the automotive sector have had in the last few years, but it is more than just them; it is the supply chains as well. Can I encourage the Secretary of State to come and visit Gestamp in my constituency, which supplies everybody from Volvo to Jaguar Land Rover, Nissan and so on, to understand its efforts in research and development, and how we can help it to develop its business?
Households up and down the country are facing a cost of living crisis, with energy prices set to rise in April. While many are facing the choice between heating and eating, North sea oil and gas producers are posting record profits. Can the Secretary of State tell me why the Government are not backing the windfall tax on North sea oil and gas producers’ profits that would help measures to ease the burden on ordinary people?
As the hon. Lady knows, we remain absolutely committed to helping people through a difficult time. We have the warm home discount, which is worth £140, and the winter fuel payment, which is worth £200. We are doing all we can to make sure that we mitigate and alleviate the pressure of increased prices this winter.
My constituents in Consett in North West Durham are paying up to 10p a litre more at major supermarkets, including Tesco, for their fuel supplies than their neighbours just down the road in Bishop Auckland, 18 miles away. Will my right hon. Friend meet me to discuss what I can do to stand up for my North West Durham constituents, who are fed up with being screwed by the big supermarkets?
My hon. Friend has done a great job representing his constituents. I know from when I visited his constituency in the aftermath of Storm Arwen how well he is appreciated. The RAC did a recent report on this, and I would be very happy to meet him at the earliest possible opportunity to discuss the issue.