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Lords Chamber

Volume 785: debated on Tuesday 14 November 2017

House of Lords

Tuesday 14 November 2017

Prayers—read by the Lord Bishop of Ely.

Death of a Member: Lord Imbert


My Lords, I regret to inform the House of the death of the noble Lord, Lord Imbert, on 13 November. On behalf of the House, I extend our condolences to the noble Lord’s family and his friends.

New Towns


Asked by

To ask Her Majesty’s Government what work they have undertaken to plan for another generation of New Towns.

My Lords, our housing White Paper makes it clear that we need to make the most of the potential for new settlements. We recognise that well-planned, well-designed new communities have an important part to play in meeting long-term housing needs. We are supporting the development of 10 new garden towns and cities and 14 new garden villages. We have legislated to enable the creation of locally led new town development corporations to provide a powerful delivery option.

Is my noble friend aware that I had the privilege of representing Northampton for 23 years, one of six third-generation new towns? All six doubled their populations and were highly successful. Given the scale of the challenge on the housing front, has the time not come to find some other new towns, particularly around the fringes of London, for example in Bedford, Ashford and Guildford? Is not one of the principal reasons why development corporations are the most successful way of building a very large community that they are much quicker at doing the work, and above all better at integrating with local communities in a way that no other bodies have so far succeeded in doing?

My Lords, my noble friend is certainly well known for his support of new towns and new villages, and I am well aware of his great work in Northampton in supporting the expansion of the town when that was not always popular. He deserves much credit for doing so. As I say, we are progressing with 10 cities or towns and 14 villages. The aim is ultimately that there will be housing for 220,000 people in those communities. My noble friend is absolutely right about the vehicle of the new town development corporation, which is the option being pursued in, for example, Ebbsfleet.

My Lords, I should first draw attention to my interests in this area as set out in the register. I welcome the fact that on a cross-party basis, but particularly with Ministers, I have been able to work to bring forward changes to the New Towns Act to allow developments to be locally led. Can the Minister give the House any sense of when the regulations may come forward to allow that? The Government have promised it, so I hope that they can be brought forward at an early stage. Does he agree that it is critical, where either new town corporations or other delivery mechanisms are used, that we ensure that new settlements are delivered at the highest quality with a full range of services for a 21st-century village, not merely a housing estate?

My Lords, I also acknowledge the great work of the noble Lord in relation to garden towns and cities. I know that he was very supportive when we took forward powers in the Neighbourhood Planning Bill, as it then was, and I thank him for that. I agree about the importance of the regulations, which we will be bringing forward. As I say, the development corporation mechanism is certainly appropriate for some of the larger towns, as it is for Ebbsfleet, and we anticipate that others may come forward and use the mechanism. We are seeing some very successful developments in, for example, Bicester, north Essex and so on. They may want to use the mechanism; that is to be discussed and decided.

My Lords, I refer the House to my local government interests as set out in the register. Can the noble Lord tell the House what work has been done by the department to ensure that these developments are self-sustaining with schools, health facilities, transport links and other infrastructure, including broadband? In the past we have not always got this right. For example, people waited many years for a station to arrive in Basildon.

My Lords, the noble Lord is right. The wave of new towns under the last Government—the ecotowns—was very well intentioned but we have learned from aspects of the programme. When developing new towns and villages, the indicators show that we need to pursue infrastructure and design. Often the money that has been advanced to these communities is tied in with doing that work, and reports are often presented on an annual basis to show that that is happening.

As I read the statistics, the Department for Transport’s capital budget has not kept pace with these developments. Can he assure the House that those capital budgets will be matched by Department for Transport capital budgets?

My Lords, the noble Lord is absolutely right about the importance of infrastructure. For example, £261 million of infrastructure spending has gone to Ebbsfleet for development; £19 million, closely related to transport, has gone to Bicester. Obviously, maintaining those capital budgets is a key consideration in discussions with other departments.

My Lords, plans for new towns must include a wide range of different kinds of housing to enable all people to access decent, affordable homes. Developers often wish to build large, four or five-bedroom houses—unsurprisingly, as they make the most profit—but families, couples and single-person households need very different kinds of properties. How are Her Majesty’s Government planning to ensure that a wide range of housing sizes and tenures will be provided in these new developments?

My Lords, the right reverend Prelate brings in the important element of the necessary range of tenure and types of property. In garden town and village status applications, various things are looked at: the value-added aspect, need, particular aspects of community, green spaces, and design. All those things are weighed when awarding the status. I think 51 applications were made for garden villages; 14 were awarded. Those are the criteria we look at.

As new towns, by definition, will not be built on brownfield sites, I urge the Minister, with the government machine, to constantly put the case for the building needed, because only 12% of the land of England is built on. We are not short of land; it will have to be what people call the green belt. I do not think that we as a Government did enough—nor have the current Government—to propagate the fact that there is more than enough land for the building needed.

The noble Lord has a point, though of course it is not always in the right places. Very often, we have great areas of green land where it would not be appropriate to put a new town. He is right about the pressures that exist and the fact that we often overstate the amount of built-up land, even in the south of England. That said, we are using brownfield sites, for example in Ebbsfleet.

How long will it take to complete the Government’s very welcome but ambitious programme for new towns and villages?

My noble friend raises an interesting point. As I have indicated, the target, or perhaps aspiration, is 220,000; I think that by the time that aspiration is reached, not many of us in the Chamber will still be here.

Foreign Policy: Support for UK Businesses in Global Trade


Asked by

To ask Her Majesty’s Government what assessment they have made of the extent to which the United Kingdom’s foreign policy supports the needs of United Kingdom businesses to create and engage with trade opportunities globally.

My Lords, promoting the UK’s prosperity is one of Her Majesty’s Government’s key foreign policy objectives. We seek to create new opportunities for business by championing open markets and promoting economic reform, better business environments and key trade partners. Using our network of overseas posts and programme funds, we work to support British businesses to make the most of these opportunities and we are preparing for an independent UK trade policy, deepening dialogues with future FTA partners.

My Lords, does the noble Earl wish to concede that a combination of conflicting intradepartmental priorities and policies, leading sometimes to a lack of visible ministerial support, has a detrimental impact on industry’s ability to enter and further new markets? Given that government should not consider itself to be the sole arbiter of bilateral relations, should not a primary focus be to create an environment whereby the private sector thrives, best achieved in step with policy and industry?

My Lords, the noble Viscount raises a number of points, partly on ministerial involvement in this process. My noble friend Lady Fairhead, the Minister for UK Export Finance, is conducting a review of our export strategy. This puts finance at the very heart of trade promotions. The Government’s industrial strategy will result in improvements to the support that the DIT can give other firms.

My Lords, there are those on the Benches opposite who preach that, in the event of a hard Brexit, the WTO will be our main avenue to trade. Meanwhile, across the Atlantic, Trump and his team are already degrading the capability of the WTO. Are the Government aware of the actions that are already beginning to reduce the dispute resolution capability of the WTO? What representations are the Government making to the Trump Administration in support of the WTO?

My Lords, as always with our closest ally, the United States, we have continued relations with its Administration. The Prime Minister’s speech in Florence added new momentum to the negotiations by making a firm commitment on the financial settlement and by proposing a time-limited implementation period in the interests of both the UK and the EU. On the points the noble Lord made about the WTO, I will have to write to him on some of the detail, but in leaving the EU we will need to update the terms of our WTO membership because our commitments are currently applied through the collective EU schedules.

Will my noble friend accept that expanding trade opportunities nowadays is very much a question of getting in on the new networks and the new global value chains that now dominate world trade, in contrast to only 20 years ago? Will he agree that some of the networks that have sprung up replacing the 20th century ones, such as the ASEAN, the RECP, the SCO and others, are ones in which it is essential for British representation to be more closely involved? Finally, will he agree that our own network of which we are already a member, the Commonwealth, which occupies one-third of the whole of humankind, is also a very valuable starting point in finding gateways into these new trade areas and the great markets of the future?

My noble friend is quite right about these various groups looking at trading opportunities in the future. In particular he mentioned the Commonwealth. We are committed to working with our friends and allies in the Commonwealth. One must not forget that in March 2017 the International Trade Secretary and the then Minister, my noble friend Lord Price, had lead roles in the first Commonwealth Trade Ministers’ meeting, which brought together more than 35 Commonwealth countries.

My Lords, last week the US Secretary of Commerce, Wilbur Ross, spoke at the CBI conference. He said that the United States could become the United Kingdom’s number one trading partner post Brexit so long as we abandoned EU-style regulations and standards. Will this be the Government’s approach?

I cannot answer the whole question, but the noble Baroness will be perfectly aware that the United States is already our largest trading partner.

My Lords, I speak as an importer and an exporter. Will the noble Earl accept that 50% of this country’s trade is with the European Union through our free trade agreement and that a further 17% with 50 countries around the world is via the European Union? Now, with the Japanese free trade agreement, the European Union would come to almost 70% of our trade. Will he accept that if we crash out on a no-deal basis, it looks likely that we will jeopardise 70% of this country’s trade?

My Lords, I refer back to the Florence speech made by my right honourable friend the Prime Minister. Progress is being made in this area. Both sides have agreed that subsequent rounds have been conducted in a new spirit and are determined to work together to reach an outcome that can stand behind and work for our people. We all hope there will be a proper agreement with the European Union, but if not, WTO terms await us.

My Lords, we know that companies that export are more productive and generally more successful than others. Can my noble friend comment on the pace and direction of exports?

My Lords, exports rose by 5.9% between 2015 and 2016 to £547 billion, reflecting increases in exports of both goods and services. In percentage terms, the largest increases in UK exports between 2015 and 2016 were to New Zealand, Sweden, Turkey, Japan and Egypt. The UK’s five largest trading partners remain the US, Germany, the Netherlands, France and China.

My Lords, the Minister has twice referred to the progress made since the Prime Minister made her much-vaunted speech in Florence. Can he advise the House of two or three particular manifestations of this progress?

My Lords, further progress is being made all the time on these negotiations. If I have any more information to give the noble Lord, I do not have it in my folder.

Brexit: Food Prices


Asked by

To ask Her Majesty’s Government how they expect Brexit will affect United Kingdom food prices over the next five years.

My Lords, food prices are dependent on a number of factors. Commodity prices, exchange rates and oil prices are key drivers of UK retail food price changes. We are negotiating a unique, ambitious economic partnership with the EU, as well as future trade deals with the rest of the world. Any agreements we enter into will need to be right for consumers and industry.

My Lords, I thank the Minister for his reply. He will be aware that food price inflation hit 4.1% today, which gives credence to predictions of the kind made by the British Retail Consortium that a no-deal Brexit would be followed by rises of up to 33%. I think that the whole House would agree that it is always the poorest households that are hardest hit, so will the Government prioritise food in trade negotiations and make sure that both affordability and quality come to the top of that deal, and that we are not faced just with cheap food such as chlorine-washed chicken, because both quality and affordability will impact on the national diet?

My Lords, although inflation has stayed unchanged at 3%, the noble Baroness is right that the annual rate of food price inflation is 4.1% as of today. That is on the basis that fuel prices rose by nearly 40% last year. The noble Baroness is right to raise trade deals. We are absolutely clear that trade deals will need to reflect our food safety, environmental protection and animal welfare standards. They need to be right for consumers and industry, too.

My Lords, is it right that the best estimate within my noble friend’s department is that, after Brexit, food prices for the consumer will rise as a result of changes in the exchange rate—and, furthermore, that the income of the farming industry will fall due to an overall reduction in subsidies?

My Lords, it is clear that food prices have throughout history had a lot to do with the exchange rate, so my noble friend is right that exchange rates are a component of food prices. We believe that there is a vibrant future for agriculture. Having been at Harper Adams last week to see its work in agritech science and heard Professor Blackmore talk about robotic arrangements for agriculture, I think that there is a very strong future for agriculture. All the students whom I met were very enthusiastic about the future of our agricultural sector.

My Lords, as the noble Baroness said, low-income households will be the hardest hit by rising food prices—they already are, because they spend more of their budget on food than other people. At the same time, their benefits are steadily losing their value. Will the Government show through their actions and not just their words that they care about what is happening to the poorest people in our society by ending the benefits freeze as a matter of urgency?

Clearly, the Government are very conscious of the need to ensure that there is a safety net for vulnerable parts of the community; it is why we have the triple lock for pensions and why we spend more than £50 billion a year on benefits to support disabled people. Indeed, with the getting of many more people into employment, the number of workless households with children has decreased enormously. In many ways the matters the noble Baroness raises are matters for the Chancellor—but, as I say, we are very strongly of the view that all we are doing is providing a safety net and encouraging employment.

My Lords, does my noble friend agree that the EU external tariff punishes producers in poor countries and consumers here in wealthier countries and that cancelling it on Brexit on products such as oranges, coffee and rice that we do not grow here would cut the cost of living for British people dramatically?

My Lords, as I say, we want a unique and very special relationship with our EU friends and the continent of Europe, but the United Kingdom has always sourced food from a variety of sources and there is a high degree of diversity of foodstuffs—so we are looking to work with our European partners and also to seek deals across the globe.

My Lords, I declare an interest as the owner of two hill farms: I understand the economics of hill farming. The Minister said that he was confident in British agriculture but, without subsidies, hill farming, which is already almost uneconomic, will become disastrous. Can the Minister say whether the subsidies, including the environmental subsidies through entry-level and high-level stewardships, will be confirmed to the end of this Parliament? Sorry—I had better say “by 2022”.

My Lords, the Secretary of State and the Minister have made very clear that the continuing support—I think that the word is “support” rather than “subsidies” for agriculture—will continue until the end of this Parliament in 2022. It is important that we look to new arrangements countenancing public benefits, which I believe agriculture and management of the land undoubtedly do. Obviously we are considering agri-environmental schemes, which I think will be of considerable benefit to agriculture, farmers and the environment.

My Lords, will the Minister accept that his words stating that the Government are aware of the impact of rising food prices on the poorest people in the country have a hollow ring? To be aware of the problem and pursue policies that worsen the situation is a very evil act. Many of these families are suffering enormously because of the Government’s policies. Will the Minister take back the message that nobody wants to see this deprivation continue and that all benefits should be increased to account for the increase in the cost of food?

My Lords, I hope that the noble Baroness will accept that the Government have done a number of things, including introducing a new mandatory national living wage which has meant a £600 a year increase in earnings for a full-time worker on the previous national minimum wage. According to the ONS, the lowest-paid workers are seeing their pay go up most—by more than 6% last year. We obviously need a safety net and we have a safety net. As I say, the amounts the Government are spending on disability, incapacity, the unemployed and mental health are very considerable indeed. In fact, as a share of GDP the UK’s public spending on disability and incapacity is higher than that of any G7 country except Germany.

Armed Forces: Cuts


Asked by

To ask Her Majesty’s Government what assessment they have made of the comments made by General Ben Hodges, Commander of United States Forces in Europe, that the United Kingdom would be unable to maintain its international commitments if its Armed Forces were cut further.

My Lords, the UK Armed Forces are fulfilling all their international commitments. Her Majesty’s Government will ensure that they can continue to do so. The national security capability review is being conducted to make sure that the UK’s investment in national security capability is as joined-up, effective and efficient as possible. We take the views of the US, our closest ally, seriously and we will continue to consult with it.

I welcome the noble Earl to his multi-portfolio today. Are the Government aware that General Hodges is but one of a number of senior United States military personnel who have criticised with dismay the reducing size and shape of our Armed Forces? Can he therefore confirm that there is no intention—which would earn further rebuke—to cut the size of our Armed Forces, for example in the Royal Marines, or to curtail flying training for helicopter pilots?

I thank the noble and gallant Lord for his question. He is quite right that concerns were raised in the newspapers by General Hodges. The fact is that all these budgets are under some pressure or other. Any speculation about the measures the Government will take through the NSCR is exactly that—speculation. No decisions have been taken. Rumours in the press have been misleading and deeply unhelpful.

My Lords, we are to have a national security and capability review—that is code for “more defence cuts”. We have a statement from Ben Hodges, commander of the US Army in Europe, who said that if the UK,

“can’t maintain and sustain the level of commitments it’s fulfilling right now, then I think it risks kind of going into a different sort of category”—

that is code for “we will become second-class allies”. How does the Minister reconcile this with the Statement by the then Defence Secretary, Philip Hammond, in 2013, when he said—nay, boasted:

“The savings that I have agreed will have no impact on military manpower or equipment”?

He went on to say:

“The ambitious and far-reaching reforms we began in 2010 have eliminated the £38 billion black hole and balanced the defence budget for the first time in a generation. We are determined to ensure that the Armed Forces of the future have the resources they need to deliver our nation’s security”.

There has been an impact on manpower and equipment. We have failed to balance the defence budget and Ben Hodges clearly believes that in the future we will not have the resources to deliver our nation’s security.

My Lords, I repeat that our Armed Forces are fulfilling their commitments across the globe and this Government will ensure that they continue to do so. I remind the House—as many Ministers have in the past—that our investment of 2% of UK GDP in defence gives us a leadership role in operations and exercises. To name just some of the activities currently under way, we are proud of our leading role in NATO’s Enhanced Forward Presence, NATO air policing and NATO standing naval forces. We continue to play a pivotal role in coalition operations against Daesh.

My Lords, I fully respect the right of General Hodges to pass comment on his closest ally, as he sees it. It is difficult to give reassurance right across the board but there are certain yardsticks as far as UK defence capability is concerned that an ally watches very carefully, one of which is our ongoing capability to field a division in a future conventional conflict of at least two combat brigades. That has always been our intention, our policy, and what we have managed to do. Can the Minister give an assurance that this remains our policy in this very important yardstick area?

My Lords, the noble Lord, with his great knowledge—far more than mine—has asked a question that I cannot answer. I can say that the NSCR is being undertaken to ensure that the UK’s investment in national security capabilities is as joined-up, effective and efficient as possible.

My Lords, is it not the harsh, unpalatable truth that we are cutting not into fat or even muscle but now into the very bones of our defence capability? How else can one explain the decision—not speculated but in fact—to reduce the number of replacement Apache helicopters from 50 to 38 and, further, to consider the sale of HMS “Albion”?

My Lords, as I said earlier, press reports are pure speculation. There are always pressures on our defence budget but we will continue to enable our Armed Forces to carry out the job that we ask them to do in defending this country.

My Lords, my noble friend the Minister will be aware that I am not convinced that we have struck the right balance between overseas aid and defence but is it not clear that, with the notable exception of France, the defence effort of our European partners is, relatively speaking, pathetic? Will the Minister encourage our European partners to increase their defence effort and meet the 2% target?

My Lords, I thank my noble friend for his question. There are in fact six EU states that meet the 2% NATO target, including the United Kingdom, Estonia, Greece, Poland and Romania. I should add that France does not meet that target but falls a couple of points behind. As for meeting the 0.7% and the 2% targets, I think our country is the only one to manage that.

Daesh: Raqqa

Private Notice Question

Asked by

To ask Her Majesty’s Government whether they were aware of the decision to allow some 4,000 Daesh fighters and their families to leave Raqqa, and what is their assessment of the implications of this decision for security in the region and for the UK.

My Lords, we were not involved in the discussions and did not condone the decision. This was a local agreement by local leaders, including the Raqqa Civil Council and tribal elders. Despite territorial losses, Daesh remains a threat and coalition activity against it continues. We remain determined to fight and defeat Daesh. We are prepared for the risk from returnees as Daesh loses territory and we are using a range of tools to disrupt and diminish that threat.

My Lords, I thank the Minister for his Answer. These clearly are hardened fighters and I hope we have put in place mechanisms to spot them when they come in. Militarily, we have now effectively destroyed the caliphate in physical terms, and we should be very pleased about that huge success. Now, we must move towards trying to get a proper ceasefire in Syria. The only way to do that is to involve the SDF, the Kurds and other coalition members, but also Assad. Assad might be a loathsome man but he is a fact of life on the ground. If he and his structure suddenly went, 2 million to 3 million Alawites and Christians could possibly be wiped out but would certainly be refugees. We really must deal with this dreadful man because otherwise we will not have a ceasefire, the fighting will continue and people will continue to be killed. Will we now have more connection with Assad, the SDF and the others to ensure that there is a ceasefire, so that we can then move forward to some sort of future settlement?

First, I agree with the noble Lord about the despicable nature of the crimes committed by Daesh fighters. We have all rightly condemned those, and the Government have taken a very strong stance to ensure that they are held to account. The noble Lord will be aware that in September, during the UNGA, we led on a Security Council resolution specifically to hold Daesh fighters to account.

On the situation regarding the different parties, the noble Lord is right that the coalition continues to support the SDF and the Kurds. However, on the specific issue of Bashar Assad, we have made our position clear: we do not believe that he should be leading Syria at the end of any discussions that take place. That is ultimately a call for the Syrian people themselves but we have been consistent in our call to ensure that there is a true representation of civilian communities in Syria, and clear that Bashar Assad does not provide any sense of a final settlement being reached in Syria. At the same time, I take on board totally the fact that we must ensure the security and safety of all communities within Syria, particularly the minorities who have suffered dreadfully during this far too long conflict.

My Lords, the fact is that these fighters have gone somewhere. They have not disappeared, and there is a potential threat to neighbouring countries. What assessment have the Government made of the threat to neighbouring countries, particularly those which are fighting Daesh? Also, what assessment has the Minister made of how that release of fighters affects our ability to hold these criminals to account? It is vital that we do that.

I agree with the noble Lord, most certainly on his final point—the Government, as he knows, take very seriously the need to hold them to account. Just to put this in context, the number quoted also includes the families. The deal was known to the SDF, in particular, and was a local tribal deal. The purpose behind the evacuation was to minimise the loss of civilian lives in the fall of Raqqa, particularly those of women and young children. To track Daesh fighters we are continuing to use all agencies on the ground and to work with the coalition of 73 countries, including several neighbouring countries, to ensure that those who are seeking to leave the conflict zone in Syria and in Iraq are held accountable locally. If foreign fighters seek to return to the UK, there is due process in place to ensure that they are held to account for their crimes abroad.

The Minister will have heard the noble Earl, Lord Courtown, say 10 minutes ago that we continue to play a pivotal role in operations against Daesh. The presence of coalition aircraft over the convoy, as reported on BBC News, suggests that at least some leading members of the coalition knew what was going on and, perhaps, must have been involved in the conflict. Is he saying that we were not playing a pivotal role in this?

My noble friend made the point that we continue to be at the heart and centre of the fight against Daesh in both Syria and Iraq. I think that some of the media reports were speculative. However, to put the noble Lord’s question into context, the deal was not not known to people as there were two press releases at the time highlighting that the evacuation was taking place. It was not a question of not knowing. We continue to monitor all aspects of any Daesh fighters fleeing from the territory. We continue to monitor their movements very closely.

Can my noble friend confirm that many foreign Daesh fighters have burned their passports, so in the case of British fighters it will be quite difficult, but not impossible, for them to find their way back to the United Kingdom?

My noble friend raises a point and I am sure there are cases where that has happened. I suggest to him that anyone making themselves known to the authorities on the ground will be held to account. There are measures in place to ensure that those who somehow, through various efforts, return to the UK are held to account. It is ultimately for the CPS to take forward any prosecutions which may occur.

The Minister’s account of what seems to have happened gets curiouser and curiouser. As I understand what he is now saying, we knew this was going on. Presumably the Americans also knew that it was going on. The other members of the coalition knew that it was going on. Did we try to stop it? Did we make representations to whoever was doing the deal that it was not in the interests of the coalition or of the war against Daesh? In short, what did we do except just look at it?

For the benefit of the noble Lord and the whole House I shall read from the press release put out on 14 October by Jonathan Braga, the coalition’s director of operations. At the end, it states:

“We do not condone any arrangement that allows Daesh terrorists to escape Raqqa without facing justice only to resurface somewhere else. We remain concerned about the thousands of civilians in Raqqa who remain subject to Daesh cruelty”.

It continues:

“Daesh terrorists have been hiding behind women and children”—

I alluded to that—

“for three years, and we are against any arrangement that lets them continue to do so”.

As I said, there were press releases at the time. This was a decision made locally by tribal elders and the Raqqa civilian council. The primary objective behind the decision was to protect women and children. The Daesh fighters numbered not thousands but hundreds, and they continue to be monitored. As to the coalition’s role in any decision-taking, we do not condone any such arrangement, and we continue to ensure that any Daesh fighters, wherever they may be in the territory, are held to account.

The noble Lord, Lord West, quite rightly wanted a complete ceasefire in Syria. How would that be achieved by wiping out every last Daesh fighter? Secondly, will the Government ensure that wives and other camp-followers are not held responsible for the crimes of the fighters?

With Daesh, we are dealing with a despicable organisation. The way that it has influenced many, in terms of recruitment, is well known to all noble Lords. The noble Lord’s point is pertinent: we need to ensure that all efforts are made to save any lives that can be saved, particularly those of women and young children. Of course I totally agree with the noble Lord, Lord West, that ultimately what we are seeking from our operations on the ground and from the coalition engagement—with all 70-odd nations involved with that coalition—is to reach a final settlement that protects the peace and security of all communities that have been impacted by Daesh activity not just in Syria but, as we are seeing now, encouragingly, in Iraq as well.

My Lords, can my noble friend tell me whether there have been discussions with other members of the coalition about trying to address the situation so that these fighters can be detained and face the justice that he mentioned in the press release?

Absolutely. As I mentioned earlier, we championed an anti-Daesh resolution at the Security Council. We continue to work not just with our P5 coalition partners but across the piece to ensure that, as my noble friend rightly says, these Daesh fighters, whether they are caught in Syria, crossing borders or making their way back home if they were foreign fighters—there were some who, regrettably and tragically, left the UK—are held to account for their actions and brought to justice.

Space Industry Bill [HL]


Amendment 1

Moved by

1: After Clause 1, insert the following new Clause—

“Potential impact of leaving the European Union on the United Kingdom’s space industry

(1) The Secretary of State must carry out an assessment of the potential impact that leaving the European Union will have on the United Kingdom’s space industry.(2) The assessment under subsection (1) must make reference to the following areas—(a) Membership of the European Space Agency;(b) the impact of the UK’s exit from the EU on research and development and access to funding, including Horizon 2020;(c) the free movement to the UK of those who work in the space industry;(d) the UK’s participation in the Galileo and Copernicus programmes; and(e) the impact of the UK leaving the Single Market on supply chains within the space industry.(3) The Secretary of State must lay a report of the assessment before Parliament within one year of this Act passing, and once in each of the five calendar years following.(4) If an assessment of the impact of leaving the European Union on the UK’s space industry has already been undertaken, the Secretary of State must lay a report of this assessment before Parliament on the day on which this Act is passed.”

My Lords, while other noble Lords go to more urgent business, perhaps I could open by welcoming the noble Baroness, Lady Sugg, to her position commanding this particular spaceship and wish her a very fulfilling role in that and in the other positions that I am sure will come.

We have no hesitation in probing further on where our space industry will find itself if Brexit ever occurs. During the passage of the Bill we have had a glimpse of the exciting opportunities ahead for British technology and British industry. The UK space sector is already at the cutting edge of exploring the universe and connecting people to the world around them. It is an industry with a £14 billion turnover, £5 billion in exports, 71% growth since 2010—thanks in no small measure to the priority that the coalition Government gave to the industry under the stewardship of the noble Lord, Lord Willetts—and more than 40,000 direct employees, including 1,400 apprentices. But no industry epitomises the European project more than this industry and its future. Indeed, only yesterday Airbus put out a press release saying that it had won contracts to build two new satellites and that this would be done with work both in Britain and in France.

It is interesting that in an annexe to a letter to the noble Lord, Lord Boswell, in his capacity as chair of this House’s European Union Committee, the European Commission spells out its ambitions by stating:

“The Commission aims to boost demand for space programmes among public and private users, facilitating access to and use of space data, and stimulating the development and use of innovative downstream applications. The Commission intends to take concrete measures (including regulatory ones where justified) to encourage the uptake of space services and data, advance the EU space programmes, and meet new user needs. The Commission will prioritise the following main actions:

Promote the uptake of Copernicus, EGNOS and Galileo solutions in EU policies, where justified and beneficial, including measures introducing the use of Galileo for mobile phones, and critical infrastructure using time synchronisation.

Facilitate the use of Copernicus data and information by strengthening data dissemination and setting up platform services, promoting interfaces with non-space data and services.

Stimulate the development of space applications with the greater involvement of new actors from different domains.

Together with Member States and industry, promote the efficient and demand-driven use of satellite communications to foster ubiquitous connectivity in all Member States.

Remain committed to the stability of the EU space programme and develop these on a user-driven basis to continue delivering state-of-the-art services including exploring alternative business models and taking account of technological progress.

Address emerging needs related, in particular, to climate change/sustainable development and security and defence”.

The purpose of the amendment is simple: to ask the Government whether they have made any assessment of the impact of Brexit on our space industries—and, if so, whether they will publish it. It is clear that the Commission has clear ideas of where it wants to go in terms of space, which is very much in parallel with the discussions that we have had in discussing the Bill. Do the Government intend to remain part of the strategy and programme outlined by the Commission in the letter to the noble Lord, Lord Boswell—and, if so, how? If we are not an integral part of the European space programme, what impact would that have on our viability as a spaceport centre, compared to spaceports located within the European family?

These are questions to which, “It’ll be alright on the night”, is not an answer. We need to know whether the Government’s policy is not a journey into space but simply a leap in the dark. I beg to move.

My Lords, I declared an interest at the beginning of Committee and feel that that it is appropriate to do so again. I live in sight of Prestwick Airport, which has an active interest in the Bill and is an ideal site for the licensing of the first UK spaceport. I notice that my noble friend Lord Strathclyde, who was in his seat at the beginning of this debate, and my noble friend Lord Lang, who remains in his seat, have been very active supporters of the Ayrshire growth strategy and the interests of the airport in being so licensed.

I will focus briefly on paragraph (3) of the amendment: the importance of the Secretary of State laying,

“a report of the assessment before Parliament within one year of this Act passing, and once in each of the five calendar years following”.

Looking at the five items listed under new Clause 1(2). I think that the noble Lord, Lord McNally, would agree that the wider importance of collaboration not just with Europe but internationally is critical to ensure the economic success of the industry. I believe that a spaceport in the UK is a key development to unlock the potential for economic growth related to the space industry for the whole of the UK. As the first spaceport in Europe, it could be the catalyst for a whole new launch industry, and everything that flows from that. We will need to co-operate with Europe on all these areas if we are to achieve that objective. Grants of some £10 million here or there are frankly nothing compared with the huge development costs associated with this industry. I hope that the Government will be serious about getting involved.

At a time when my noble friend the Minister is looking to ensure economic growth during the Brexit period, and when significant infrastructure projects are being funded, surely a significant commitment to the spaceport is a sensible investment, and is small in overall terms. But it would be a major catalyst to ensure that this project happens, as would the ongoing relationship with Europe. I would be grateful if my noble friend could comment on this and recognise the vital importance of a significant, wide opportunity to bring together the vested interests in the economic success of this project—which, in addition to Europe, I would add are: a clear understanding of the range of trade and technical issues with the United States and the acquisition of funding required to deliver the spaceport and spaceflight operations. With that in mind, I hope that the Minister is looking at special-purpose vehicles rather than the straightforward grant process in order for operators to undertake activities and operations from the UK—in other words, to have a wide range of partners, including the Government and the Scottish Government but also private sector operations and organisations. Financial guarantees and an insurance cap will be absolutely essential.

I close by saying that we need a strong level of government support and a strong level of co-operation with Europe to achieve these objectives. This will be a highly competitive global market. I fear that we may have a hollow Bill, which might be a great exemplar of regulatory, legal and structural support—but if we do not address the issue I have raised, it will remain hollow. We as a country should not allow ourselves to miss this opportunity. If we do, we will be left with an Act of Parliament promoting an industry that never takes off.

My Lords, we debated a similar amendment in Committee. The Government said in response that they would work to ensure that we got the best deal with the EU to support strong growth in the sector, but that they did not consider that including provisions related to the EU negotiations would improve the Bill or the support that the Bill, which is about regulation of UK space activities and suborbital activities, would provide to the sector. The Government went on to say that it would be damaging to the UK’s negotiating position with the EU if information on the potential economic consequences of leaving the EU was disclosed.

The difficulty the Government have is that their whole argument for bringing this skeletal Bill forward at this time—one year before discussions on the detailed and extensive secondary legislation start, and nearly two years before that crucial secondary legislation is considered by Parliament—is to end uncertainty for the space industry by showing that the Government intend to provide a structure for UK space activities and suborbital activities. Surely, however, part of the uncertainty at present is the impact our departure from the EU, and the terms on which we depart, will have on the UK space industry, and thus on investment decisions.

If the objective really is to remove uncertainty, as opposed to producing the Bill at this time to fill up the gaps in parliamentary business left by the Government’s almost non-existent legislative programme, why are they not prepared to reduce the uncertainty over the potential impact on the industry of our withdrawal from the EU by providing an assessment of what that impact could be? The amendment calls for a report of the assessment to be laid before Parliament within one year of the Act passing or on the day on which it is passed if that assessment has already been undertaken. Surely such an assessment would also be of real value to all the parties concerned when the discussions start on the crucial regulations that will provide the important details that are sadly missing from the Bill.

Once again, when discussions on the regulations start, why are the Government declining to provide the parties concerned with details of the not insignificant issue of the impact on the space industry and on the Bill as a result of our departure from the EU?

My Lords, the UK space industry is a global success story. I am grateful for the productive debate we had in Committee, which will ensure the Bill puts this country at the forefront of new space services.

The Government continue to invest in the success of the UK space sector—for example, we recently invested more than £100 million in new satellite test facilities at Harwell, and manufacture and test facilities for rocket engines at Westcott in Buckinghamshire. As we discussed, another measure of our support to the UK space sector will be through our negotiations with the EU on future collaboration on the EU space programmes. The UK has played a major part in developing the main EU space programmes, Galileo and Copernicus, which have supported the rapid growth of the UK space sector and contributed directly to our prosperity and security. We are working to ensure we get the best deal with the EU to support strong growth in the sector. Last month, the Government published a science and innovation discussion paper and an external security discussion paper. Both set out the Government’s wish to discuss options for future arrangements in the EU space programmes.

My noble friend Lord Moynihan asked about continued support for the space industry. The European Space Agency programmes will continue to play an important role in delivering the UK national space objectives and, in December last year, the UK negotiated an investment of more than €1.4 billion over the next five years in ESA space initiatives. This sustained investment, alongside our industrial strategy, will ensure that we build on the strengths of the UK’s growing space industry. The UK’s membership of the European Space Agency will not be affected by the UK leaving the EU.

The Government hold a mix of qualitative and quantitative analysis of the impact of leaving the EU on sectors of the UK economy, including the UK’s space industry. This is contained in a range of documents developed at different times since the referendum. The analysis in this area is constantly evolving and being updated based on our regular discussions with industry and our negotiations with the EU. As the Secretary of State for Exiting the EU said in his Written Statement on 7 November, the intention is to provide this information to the Exiting the EU Select Committee as soon as possible, and within three weeks of the date of that Statement.

My noble friend Lord Callanan has confirmed to the House that we anticipate sharing the same information on the same basis with the Lords EU Committee as with the House of Commons Select Committee, subject to our being able to agree the terms of that disclosure. Given that this evidence will be published in the coming weeks, I ask the noble Lord to withdraw Amendment 1.

My Lords, I thank the Minister for that reply. We look forward to this information being gathered together into one clear document, as at the moment it is scattered among many documents. I am sure that not only the EU Committee but the whole House will read it with great interest.

This is not a hostile amendment but one that genuinely searches after facts. A generation of us—not including the Minister—remember our last great adventure into the space industry with Blue Streak and Black Arrow over 40 years ago. I also exclude my noble friend on these Benches from that. I had better not go any further: I remember Blue Streak and Black Arrow and finding out that this was too expensive a game for us to go it alone. As we take forward what is still a very exciting industry—the Minister herself announced a number of new facets—we need to ensure that we are at its cutting edge and do not miss this chance. In that spirit, I beg leave to withdraw the amendment.

Amendment 1 withdrawn.

Clause 2: Duties and supplementary powers of the regulator

Amendment 2

Moved by

2: Clause 2, page 2, line 25, at end insert—

“( ) the effect on the environment and on local communities of activities connected with the operation of spaceflight activities or the operation of a spaceport as licensed under this Act;”

Amendment 2 is another amendment that we discussed in Committee. Currently, the Bill provides that the regulator must take into account,

“any environmental objectives set by the Secretary of State”,

when exercising the powers given to it under the Bill. Our amendment adds a wider environmental duty; namely, that the regulator must take into account,

“the effect on the environment and on local communities of activities connected with the operation of spaceflight activities or the operation of a spaceport as licensed under this Act”.

In other words, this consideration would not be solely dependent on what the Secretary of State of the day decided should or should not be laid down as environmental objectives for the regulator to take into account.

The Government were not enthusiastic about our amendment in Committee, arguing that environmental and local community considerations were already covered by the provisions of Clause 2(2)(c) and (e) and local planning processes. However, the Government appeared to accept that a person with exemption from an operator licence would not be covered by some of the provisions of Clause 2(2) since the regulator would not be involved in issuing a licence.

The importance of taking into account the effect of spaceflight activities and the operation of a spaceport on the environment and local communities needs to be made much clearer in the Bill. It is too important an issue to be left open to potentially different interpretations of the less than precise wording currently in the Bill or to the whim of Secretaries of State as to what environmental objectives they decide to set or not to set. I expressed the hope in Committee that the Government might feel able to be more positive on this issue during the Bill’s later stages. In moving my amendment, I hope that the Minister will be able to indicate some movement on this point when she responds.

My Lords, I was pleased to be able to add my name to Amendment 2. Before I speak to it, I welcome the Government’s Amendment 9, because it adds to Schedule 1 both noise and emissions as factors that should be taken into account when granting a licence. That is a step forward. However, it is still a narrow interpretation of the problems that I anticipate local communities and the slightly wider area might encounter. If these spaceports are a success—across the House we very much hope that they will be—they will have an impact on local communities and on the environment that those communities currently enjoy. These are by definition remote and peaceful places at this moment, and they will be significantly less remote and less peaceful after the development of a spaceport.

Other potential issues include the following. First, there is the issue of visual amenity in what could well be beautiful areas. These will be large installations and will not easily blend into the landscape. Secondly, there is the impact on local roads. I do not know the situation in Scotland, but I know that the roads in Wales are hardly even small motorways in that area. We are talking about moving large, wide loads across the country and along roads, often moving them slowly on to the site, and that will be disruptive. I remember how the noble Lord, Lord Tunnicliffe, in a memorable phrase, described a rocket as a controlled explosion. There is also potentially air pollution, as well as noise pollution.

Finally, I point to the basics of many of the issues and problems arising from planning applications for large or even small developments. Clearing a site to establish a spaceport could well impact on existing wildlife, and the ongoing use of the spaceport could, for example, disturb nesting birds.

I do not want to be a doom-monger but we need to be realistic. The enthusiasm of the Welsh and Scottish Governments may not be shared by local people. Any of us here who have been local councillors— I was a councillor for 17 years, albeit a long time ago—know that what I have outlined are routine planning issues that, appropriately, get in the way of wholesale development that does not take into consideration the amenities of local people and the environment beyond. Spaceports should not be exempt from the rules, and that needs to be flagged in this Bill.

My Lords, I recognise noble Lords’ concerns that there are currently no specific provisions in the Bill regarding the environmental impacts of spaceports and spaceflight activities on local communities, particularly in relation to noise and emissions. However, Clause 2 requires the regulator to take into account the environmental objectives set by the Government. I know that some noble Lords have raised concerns that future objectives cannot be predicted—indeed, the noble Lord, Lord Rosser, raised that again today—but the inclusion of that requirement was intended to promote environmental protection, as the regulator will have to take account of existing guidance, such as Defra’s air quality plan.

As noble Lords will be aware, there already exists a comprehensive body of environmental and planning legislation that spaceports and spaceflight operators will need to comply with independently of the requirements under the Bill. For example, an environmental impact assessment may be required for airport-related development under Schedule 2 to the environmental impact assessment regulations where it is,

“likely to have significant effects on the environment by virtue of factors such as its nature, size or location”.

In such cases, the local planning authority will be obliged to scrutinise the environmental impact, taking into account the concerns of local communities such as the noble Baroness, Lady Randerson, has just raised. An environmental assessment will be required as part of any airspace changes.

However, there might be circumstances where a particular activity could be carried out without the need for an environmental impact assessment under planning and airspace rules. The purpose of Amendment 9 is to put on the face of the Bill a licence condition that the regulator could impose—for example, where an environmental impact or other assessment has not already been undertaken.

I appreciate that this amendment does not impose a mandatory requirement for the spaceport or spaceflight operator to make an environmental assessment; nor does it require the regulator to take into account environmental and local impacts, as Amendment 2 seeks to do. However, it makes very clear the Government’s intention that some form of assessment of noise and emissions should take place, and it does this without creating requirements in the Bill that may duplicate existing requirements to carry out environmental assessments under other enactments.

I hope that I have reassured noble Lords of the Government’s intention of ensuring that environmental impacts are assessed, either as part of the planning process or as a condition of a licence under the Bill. However, I am aware that your Lordships do not think that this goes far enough, as they have made clear today—the noble Baroness, Lady Randerson, made a very fair point about roads and road access. Therefore, I assure the House that the Government are considering introducing in the other place a further amendment that will require spaceport and spaceflight applicants to submit a noise and emissions assessment, and that regulators take this into account when deciding the licence application. I therefore ask the noble Lord to withdraw his amendment.

I thank the Minister for her reply but perhaps I may inquire a bit further. Government Amendment 9 provides that a licence under this legislation can include a condition that an assessment must be done of the impact that noise and emissions caused by the activities being licensed will have on local communities. If that amendment is agreed—we are certainly happy with it—it will then be included in the Bill when it goes to the Commons. I am not entirely clear from what the Minister has said what the Government are still considering as an amendment they might bring forward in the Commons. Will there be an amendment referring to the wider environmental duty and the impact on local communities, or is that not what the Minister was saying? I am not clear what the Government are considering bringing forward in the Commons.

The amendment we are considering taking forward is requiring spaceports and applicants to carry out the environmental assessment, which will of course take into account the effect on the local community, and requiring regulators to take that into account.

Perhaps I did not understand the matter properly first time round, but in the light of that clarification from the Minister, I beg leave to withdraw the amendment.

Amendment 2 withdrawn.

Amendment 3

Moved by

3: Clause 2, page 2, line 27, at end insert—

“( ) any space debris mitigation guidelines issued by an international organisation in which the government of the United Kingdom is represented.”

My Lords, Clause 2 sets out the overarching duties of the regulator in carrying out its functions under the Bill. Subsection (1) establishes the duty of securing public safety as the regulator’s priority, while subsection (2) lists the other factors that the regulator must take into account while carrying out its functions. There is no hierarchy in the matters listed in subsection (2).

Amendments 3 and 8 to subsection (2) and Schedule 1 are in response to the helpful debate on space debris on the first day of Committee. In relation to an amendment tabled to Clause 12, the noble Lord, Lord McNally, highlighted the very real risks and challenges posed by space debris. The noble Baroness, Lady Randerson, recognised the work of the Inter-Agency Space Debris Coordination Committee—the IADC—of which the UK is a member, which has issued guidelines in this area. My noble friend Lord Willetts acknowledged the UK’s expertise in this area.

I would like to take this opportunity to reiterate the points made by my noble friend Lord Callanan during this debate. The UK Space Agency already considers matters relating to space debris and the guidelines issued by the IADC, and is an active member in carrying out its regulatory function under the Outer Space Act 1986. Through the IADC, the UK Government remain fully committed to implementing and influencing best practice to protect the space environment. Furthermore, the Bill enables regulators to include conditions within licences that relate to the disposal of a satellite at the end of its operational life and compliance with debris mitigation guidelines.

In the light of the Government’s commitment to the IADC and following further reflection on the points raised in Committee, we are tabling this amendment, which would place a requirement in the Bill for a regulator to consider space debris mitigation guidelines when exercising its functions. These guidelines are issued by an international organisation to which the UK is represented. This wording will cover international bodies, including the IADC, and the International Organisation for Standardization’s orbital debris co-ordination working group, as mentioned by the noble Baroness, Lady Randerson, in Committee. I beg to move Amendment 3.

The noble Lord, Lord McNally, spoke eloquently in Committee on the issue of his party and pavement politics, before referring to his concerns about space debris and the need to bring it back safely—although he did not say whether he was looking for weekly or fortnightly collections. If the noble Lord, Lord McNally, considers that the Government’s amendments address the legitimate concerns he raised, they will of course have our support.

My Lords, I welcome the amendments. They are a first step in the right direction. Although I may have rather light-heartedly introduced the issue at the last stage, we have only to look at what we have done to the sea and to Everest to see how easily important places can be polluted. For that reason, it is important that this is on the agenda.

As was indicated in our last debate, work is being done about this problem by British technology companies. Although it may be the less glamorous end of space travel, clearing up space debris may well be another cutting-edge area that we can exploit as this expands.

The IADC is a representative body. Its membership includes all the big players—Russia, the United States, China, ourselves, the European Space Agency, India, Italy, France, Japan, Ukraine. It is the right body to take these matters forward and the amendment is welcome.

I thank noble Lords for their support for the amendment, particularly the noble Lord, Lord McNally, who raised this issue in Committee and has put his name to the amendment.

Amendment 3 agreed.

Clause 9: Grant of operator licences: safety

Amendment 4

Moved by

My Lords, I shall speak also to the other amendments in this group.

I have read my speech in Committee, which was very good and persuasive. The trouble is that it was also unsuccessful and so, as a student of the Companion, I will not repeat it. However, I would like to say a final word or two on safety. I thank the Minister for the time she and her predecessor spent with us discussing this matter and for the letter she sent us on two points, to which I will come later.

NASA has been in the space business since I was a boy—and that was a long time ago. I have had a brief look at its website and, as far as I can see, it spends £2.9 billion a year on safety and security. However, despite its efforts, it has regularly killed people. The early rocket-powered flight experiments had fatalities; it is often forgotten that the moon programme killed three astronauts on the ground when there was a fire in the capsule; the shuttle programme managed only 135 missions, two crashed catastrophically and 14 people died. That was probably as well as could be done with all that effort, but we are asking the CAA and/or the United Kingdom Space Agency to tackle the same task. I am afraid that I am somewhat pessimistic about what the result will be in the early stages of any UK space programme. I hope in developing the skills they will need that they will spend a lot of time with our American cousins, in particular, stealing as much knowledge as is possible.

As I said earlier, I thank the Minister for the time she found for us. She was kind enough to send us a letter giving assurances about the role of the HSE and single point accountability with respect to safety. I will not repeat the letter because I am assured she is happy to read those assurances into her response. With that, I beg to move.

My Lords, names of Members from our Benches are not attached to these amendments, but we would like to associate ourselves with all four of them. I want to say a few words about safety because it is obviously not in the industry’s interest to operate unsafely; in fact, quite the opposite. It would be a way of hastening its end. So it is not that the industry will set out to operate in a cavalier manner, and that is not what these amendments imply. From my experience of working in industries that have an inherent risk but are not necessarily as risky as the space industry, the greater prominence that safety is given in their operations at every level right up to senior management and in terms of the supervision of organisations, the more likely it is that they will be inherently safe. You can rely on processes and people on the ground to operate safely because of course it is in their interests to do so, but it is always more successful when safety is elevated to the highest possible level. It is with that in mind that we support these amendments.

I thank noble Lords for their comments on Clauses 9 and 10, given their central importance to the Bill. In consultation with the Health and Safety Executive, I wrote to the noble Lord, Lord Tunnicliffe, to address the points he raised on the first day in Committee. Following that letter, I would like to take the opportunity to explain further the role of the Health and Safety Executive in regulating space flight activities under the Space Industry Bill.

Clause 9 imposes one of the key requirements of the Bill that a regulator cannot grant a licence for spaceflight activities unless satisfied that the operator has carried out an assessment of the risks to the health and safety of persons taking part in spaceflight activities and that the operator has taken steps to ensure that risks to all other persons is as low as reasonably practicable. Furthermore, Clause 9(4)(b) means that even after all steps have been taken to reduce risk to as low as is reasonably practicable, spaceflight will not be allowed where the risk to public health and safety is unacceptable. The Bill places the onus on the regulator to be satisfied that risks are as low as reasonably practicable and that they are acceptable, but the operator must assess the risks and manage them.

The provisions in the Bill have been developed in full collaboration with the Health and Safety Executive to ensure that they align with existing UK health and safety principles on the management of risks. I should like to recap that under this Bill, the Secretary of State is the default spaceflight regulatory authority. The UK Space Agency will perform regulatory functions on the Secretary of State’s behalf, including regulating the procurement of satellite launches from other countries as well as satellite operations from the UK. The UK Space Agency will also regulate all vertically launched rockets covered under this Bill and all space activities. Finally, the UK Space Agency will license and regulate spaceports capable of vertical launch and range control services for launch to orbit.

It is our intention to use Clause 15 to appoint the Civil Aviation Authority as a spaceflight regulator for suborbital spaceplanes and spaceports capable of horizontal launch. The Government’s approach will enable us to build on the existing experience and expertise of the two organisations. I am confident that these bodies will have the capability to evaluate risk assessments and assess whether the risks have been reduced to as low as is reasonably practicable and whether they are acceptable. In this, the bodies will be assisted by the Health and Safety Executive.

I should clarify that we do not intend to appoint the Health and Safety Executive as a regulator under the Bill. This is because it is not a specialist transport, aviation or space regulator and has no experience or expertise in flight safety, space launches or air navigation. However, it is already a regulator for health and safety at work under current health and safety legislation. Accordingly, it is designated as a qualifying health and safety authority under Clause 20 and may be called upon to provide specified advice or assistance in connection with the regulator’s functions relating to safety.

Independently of the Bill, the Health and Safety at Work, etc Act 1974 and associated legislation will apply to spaceports and spaceflight activities as they would to any other workplace, while the Health and Safety Executive would retain lead responsibility for the regulation of safety on the ground. New major hazard sites such as spaceports would also require planning consent from the appropriate planning authority, and the Health and Safety Executive would act as a statutory consultee to the appropriate planning authorities.

However, the UK Space Agency or Civil Aviation Authority will retain responsibility for licensing the spaceport. This aligns with the approach under the Civil Aviation Act 1982 and the Air Navigation Order 2016. Under these provisions, the Civil Aviation Authority has overall responsibility for aviation safety. The divisions of responsibility between the CAA and the Health and Safety Executive are set out in a memorandum of understanding. We anticipate that the spaceflight regulators and the Health and Safety Executive will similarly set out the division of responsibilities.

I emphasise that although it is our intention that there be two spaceflight regulators, it is vital for accountability and safety that for any particular licence application under the Bill, there should be a single regulator responsible for deciding that application. Noble Lords raised that issue today and in Committee. In making its licensing decision, the UK Space Agency may consult the CAA—and vice versa—but that decision will rest with one body in each case.

Giving the Health and Safety Executive an additional specific role—certifying the adequacy of the safety arrangements relating to persons not taking part in spaceflight activities or for public safety in spaceports—would confuse roles and responsibilities for licensing spaceflight and associated activities. The Health and Safety Executive does not carry out this function of certification under any other legislation and does not wish to do so under this one.

I hope I have reassured noble Lords that our proposed approach is consistent with existing health and safety practice and reflects the view of the Health and Safety Executive. I acknowledge the sad history of space activity, as highlighted by the noble Lord, Lord Tunnicliffe; I assure him that safety is at the heart of the Bill. I ask the noble Lord to withdraw his amendment.

My Lords, I too have spent most of my career in safety-critical environments. I thank the noble Lord, Lord Fox, for his support. It is not directly related to the Bill, but I will take this opportunity to agree with his statements about the essence of a good safety organisation. It is crucial that safety goes from the top to the bottom and that the chief executives and the board, right down to every worker, know that safety is part of their responsibility. I hope that attitude will go through this new industry, especially as we move into the manned spaceflight phase.

I thank the Minister for her assurances. It is important that we have clear, single point accountability among regulators. If it is in the public domain, I would value a copy of the memorandum between the HSE and the appropriate regulators. With those few comments, I beg leave to withdraw the amendment.

Amendment 4 withdrawn.

Amendment 5 not moved.

Clause 10: Grant of spaceport licence

Amendments 6 and 7 not moved.

Schedule 1: Particular conditions that may be included in licences

Amendments 8 and 9

Moved by

8: Schedule 1, page 46, line 19, leave out “issued by an international organisation”

9: Schedule 1, page 46, line 37, at end insert—

“6A_ Conditions requiring the carrying out of assessments of the impact that noise and emissions from spaceflight activities authorised by the licence are expected to have on communities in the vicinity.”

Amendments 8 and 9 agreed.

Clause 14: Transfer, variation, suspension or termination of licence

Amendment 10

Moved by

10: Clause 14, page 10, line 16, at end insert—

“( ) The regulator may consent to a licence being transferred to a person (“the transferee”) only if satisfied that—(a) consenting to the transfer—(i) will not impair the national security of the United Kingdom;(ii) is consistent with the international obligations of the United Kingdom;(iii) is not contrary to the national interest;(b) the transferee has the financial and technical resources to do the things authorised by the licence, and is otherwise a fit and proper person to do them;(c) the persons who are expected to do, on the transferee’s behalf, any of the things authorised by the licence are fit and proper persons to do them.”

My Lords, Clause 14 enables a licensee to transfer their licence to another party, provided the regulator has given written consent. The provision enables a new body or company to take over the licence without starting a licence application completely afresh. In Committee the noble Lords, Lord Rosser and Lord Tunnicliffe, tabled an amendment seeking to clarify that the eligibility provisions in Clause 8(3) would also apply to the person to whom a licence is being transferred under Clause 14.

It is helpful to briefly recap what Clause 8 requires before a licence can be granted. Under subsection (2), the regulator must be satisfied that granting a licence will not impair national security, is consistent with the UK’s international obligations and would not be contrary to our national interest. Subsection (3) then sets certain eligibility criteria for licence holders, with which the regulator must be satisfied before granting a licence. The criteria ensure that a licence holder has the necessary financial and technical resources to do the things authorised by the licence and that both the licence holder and employees and agents acting on the licence holder’s behalf are fit and proper persons to do the things authorised by the licence.

It has always been the Government’s intention that the regulator will need to be satisfied that the tests set out in Clauses 8(2) and 8(3) would apply to the transfer of a licence under Clause 14, as it does to the initial grant of a licence. The amendment makes the Government’s intentions clear in the Bill and puts this beyond any doubt.

I thank noble Lords for their original amendment. I hope they will welcome the fact that we have reflected and that the amendment goes further than previously proposed. I beg to move.

I thank the Minister for the Government’s Amendment 10, which, as she said, addresses an issue we raised in Committee and will put in the Bill that the regulator may consent to a licence being transferred only if the transfer and the person to whom it is being transferred meet the same tests as laid out for the granting of the licence in Clause 8. In Committee I asked whether the consent of the Secretary of State would also be required for a licence to be transferred, bearing in mind that under Clause 8(4) the consent of the Secretary of State is required for the granting of a licence. The noble Lord, Lord Callanan, the then Minister, said he would reflect on that and come back to me. He may have done so, but if he has I am afraid I have forgotten what he said. Is the Minister able to say now or later what the answer is to that question?

Both the regulator and the Secretary of State would need to be satisfied that the transfer of a licence was appropriate.

My Lords, this is a good example of the Lords’ way of doing things in action. The Labour Front Bench noticed what they thought was a weakness; the Minister said he would go away and reflect. The Government have reflected and come back with a solution that makes the Bill better.

Amendment 10 agreed.

Clause 15: Power of Secretary of State to appoint person to exercise functions

Amendment 11

Moved by

11: Clause 15, page 11, line 18, at end insert—

“( ) Before any regulations that confer onto the CAA any additional functions are made under this section, the Secretary of State must lay before Parliament a report outlining—(a) whether the CAA has sufficient resources to undertake the additional proposed functions; and(b) whether additional funds would be made available to ensure that the CAA is able to undertake the proposed additional functions, or any other changes to its remit.”

My Lords, the amendment relates to the position of the CAA. We tabled a similar amendment in Committee. As promised, I went away and read Hansard carefully, because at the end of the debate I was still not clear about resources. The then Minister addressed a charging regime for assessing and issuing licences for monitoring and so on. Clause 61 gives the CAA and the space agency the powers to charge for their services. We can safely assume that they will charge the commercial rate to cover their costs, but my reservations were also about the development and expansion of the CAA to take on its new role prior to it becoming commercially viable. That aspect was not addressed in the Government’s response in Committee.

I was very pleased to receive a letter from the chief executive of the CAA setting out its viewpoint. As well as referring to the CAA’s power to set charges, it addresses the preparation issue. It says:

“Until the Space Flight legislation is in force the DfT is funding the CAA team that has been established to focus solely on supporting the Government with the development of the Bill and the regulatory framework, so the CAA will be ready to regulate this UK industry once the statutory powers are in place”.

I am very grateful for that additional information and I am glad to hear that the Department for Transport is funding that team, but I press the Minister for a little more detail. I find it quite difficult to get a handle on how big this team is. Perhaps she could quantify the funding that is in place to assist the CAA. Can she provide some detail on training? In working towards such a regulation, the CAA would undoubtedly look at parallels; for example, the regulation of normal aviation. However, it is surely looking across the world at how other countries regulate the space industry. I assume that there is an element of seeking information from other countries across the world, if not of sending employees to train there. I would be grateful for a bit more information to flesh out the assurances that I received from the CAA. I beg to move.

My Lords, I support the general spirit and direction of the amendment. The task that the CAA and the space agency will face will be very difficult. I hope that the Government will be able to give us further assurances that resources will be made available to power this learning curve. I hope that there will be enough time for the skills to be in place before real applications come before the regulator. It is easy to underestimate just how difficult this task will be for the CAA and the space agency.

The nature of this work, certainly in the early stages, could be quite lumpy. In earlier discussions —at Second Reading, I think—the Minister talked about perhaps only 12 launches a year. There could be moments of great intensity of activity followed by no activity and therefore no income. How will the regulator maintain this level of expertise through what could be feast and famine during that process?

My Lords, I thank the noble Baroness, Lady Randerson, for her comments on Clause 15 and the role of the CAA. As we know, the aviation sector is facing many challenges at the moment, particularly with the introduction of new technologies such as drones and spaceflight, but I can reassure noble Lords that the CAA is in strong position to deal with those challenges.

As the noble Baroness has told us, the chief executive of the CAA has written to her confirming this and, as he explained in the letter, the CAA already has already established a dedicated space team. That team started in 2012 and since then has grown in size and experience, and has worked closely to develop the Space Industry Bill. The team is building on its aviation expertise in areas such as airports and airspace to develop the capability to regulate spaceports and suborbital activities.

The noble Baroness asked what international conversations the CAA might have had. It has established good working relationships with other countries. The UK Space Agency has been building on its relationship with the United States Federal Aviation Administration, drawing on the United States’ vast experience in overseeing flight operations.

The department provides sufficient resource to ensure sufficient delivery in this area. The moneys will vary depending on the nature of the work at different times— for example, on air space consideration or international comparisons—so I am not able to give a figure today. The noble Baroness asked about funding. The Civil Aviation Authority will eventually be able to recover its costs directly from industry. Until that point, the Department for Transport will continue to provide funding.

We are confident that the CAA will have the necessary resources and the appropriate expertise to regulate the new sector. I hope that the letter and my words give the noble Baroness the necessary reassurance regarding the capacity of the CAA to regulate the activities alongside its existing aviation functions. I ask the noble Baroness to withdraw Amendment 11.

My Lords, on the basis that the CAA appears to be satisfied with its situation, I will, of course, not pursue this any further at this stage, but I would be grateful if the Minister looked again at the very specific questions I asked and, one way or another, passed those small details to me. I am interested in understanding a little better the process that will be involved. With that, I am happy to withdraw the amendment.

Amendment 11 withdrawn.

Schedule 5: Security regulations: further provision

Amendment 12

Moved by

12: Schedule 5, page 58, line 22, leave out “an enactment creating” and insert “a provision that creates”

My Lords, the amendments in this group are minor and technical amendments which are required to address drafting issues in the Bill.

First, I turn to Amendments 12, 13, 29, 30 and 38. Currently, the definition of “enactment” in Clause 68 provides that it includes an enactment contained in Northern Ireland legislation. The Interpretation Act 1978 provides in Section 5 and Schedule 1 that unless the contrary intention appears, the term “enactment” used in legislation does not include Acts of the Scottish Parliament or legislation made under those Acts. As it is the policy intention that references to “enactment” in the Bill should cover legislation made throughout the United Kingdom, we propose to amend the clause so that the term “enactment”, where used, refers to secondary legislation and Scottish and Welsh legislation, as well as retaining the reference to Northern Ireland. I reassure noble Lords that official conversations have taken place with Scotland, Wales and Northern Ireland and all are content with the amendments the Government are tabling on Report. There are a number of consequential amendments to Clause 51 and Schedule 5 to replace uses of “enactment”. Those references are to particular Acts of the UK Parliament rather than to legislation in general, so it is not appropriate for the definition of “enactment” to apply in those cases.

Amendment 39 ensures that English, Welsh and Northern Ireland partnerships can be prosecuted in Scotland. Currently, Clause 57, which deals with offences by partnerships, only extends to England, Wales and Northern Ireland. This is set out in the full heading of Clause 57, and Scotland is explicitly excluded from the extent of the clause in Clause 70(2). The Government initially considered that Clause 57 did not need to extend to Scotland because partnerships are treated differently in Scots law. Existing legislation already makes similar provision for Scotland to that in Clause 57; Clause 70 was drafted accordingly. However, it has since come to light that while there is no need for the Bill to make provision for Scottish partnerships, the current draft presents the risk that there would be no power to prosecute an English, Welsh or Northern Ireland partnership in Scotland. Since it is the policy intention that these prosecutions should be within the power of the Scottish courts, we propose to delete Clause 70(2).

Finally, Amendment 40 includes an additional provision in the Bill to allow this legislation to be extended to Crown dependencies and overseas territories, as modified, by way of an Order in Council. The Bill has the potential to bring new business opportunities in an expanding space market, bringing in new revenue, jobs, training opportunities and other benefits to local areas. It is an important principle that the potential benefits of the Bill are accessible across not just across the United Kingdom but in our Crown dependencies and overseas territories. Amendment 40 will allow the Government of a Crown dependency or overseas territory to utilise the regulatory framework the Bill creates for spaceflight activities and to develop a spaceport if they would like to do so. I beg to move Amendment 12.

May I ask a bit more about government Amendment 40 in relation to Crown dependencies and overseas territories? As I understand it, this is a fairly standard clause in Acts of Parliament, but perhaps the Minister can confirm whether that is so or it is something of a rarity.

My understanding of the Minister’s concluding comments is that a Crown dependency or overseas territory, if it wished, could seek to have a spaceport on its territory. However, would government Amendment 40 be activated, in the sense of seeking the Order in Council, by the British Government or could it be activated only if so requested by a UK Crown dependency or overseas territory itself, or could it indeed be activated at the request of a company or even another country? What would be the criteria for determining whether or not the provisions of the Act should be extended as provided for in government Amendment 40?

Would the provisions of the Act be so extended under the terms of government Amendment 40 if it was felt that it worsened the prospects of the development and expansion of the UK space industry in this country—even in Prestwick? If the provisions were so extended, could companies from any country in the world establish spaceflight facilities in a UK Crown dependency or overseas territory, or would it be restricted to British companies, at least as the lead company? Finally, could we have an assurance that extending the provisions of the Act to the Channel Islands, the Isle of Man or any British overseas territory would not give any companies, whether private or state-owned, any tax advantages, particularly in the form of lower tax, compared to the tax regime that would apply to a space industry company operating under the Act’s provisions in this country?

The noble Lord has stolen many of my lines. There seem to be a lot of loose ends here. I reiterate his question about how much of the Bill applies to a Crown dependency in the event that it builds a spaceport. Are we looking just at the right to do it, or are all the other provisions of the Bill in place in a Crown dependency situation? The point that the noble Lord made very well is: are we in danger of allowing people to set up low-cost competitors in an industry that we are hoping to run from the United Kingdom mainland?

I will try to answer as many of those questions as I can. Yes, this is a standard clause. It was not included originally because we wanted to conduct a consultation with Crown dependencies and overseas territories, which we completed over the summer. That is now done and we are including it as a government amendment.

On who can enact this, it would be done at the request of the Crown dependency or overseas territory, which would then be subject to all the legislation in the Act. But ultimately the creation of a spaceport is going to be a commercial decision, so the UK Government would not take an active role in deciding where it would be. Currently we are not aware of any Crown dependencies or overseas territories that wish to undertake this activity.

Just to be clear, the money that has been put aside to provide seedcorn for this process would not be available to Crown dependencies—is that true?

I think £10 million was put aside to help develop the cases for spaceports. Would this money be available to Crown dependencies or just to the UK mainland?

That money is available to people who are currently putting together a case to create a spaceport. As I said, there is currently no interest from overseas territories or Crown dependencies, so that money would not be used by them.

On the tax regime, I am afraid that I do not have the full answer. I will have to get back to the noble Lord.

I appreciate that this has come up suddenly but I made one or two other points that I do not think the Minister has responded to. For example, would the provision be extended to companies from any country in the world, or would it be restricted to British companies? Could it be agreed, only to find that it is to the detriment of companies wanting to set up spaceflight facilities or spaceports in this country?

Any international company could request spaceflight activity within any of the ports but, as I say, it will ultimately be a commercial decision as to whether these activities take place. We would not play an active role in that.

Is that really consistent with a Bill that is designed to promote the industry in this country?

The Bill is designed to promote the industry in this country and that is what we are focusing on. The addition of this provision just allows that in the future, should there be any interest, the Crown dependencies and overseas territories could take on the legislation framework and develop the activity.

Amendment 12 agreed.

Amendment 13

Moved by

13: Schedule 5, page 58, line 26, leave out “any such enactment” and insert “a provision that creates an offence”

Amendment 13 agreed.

Clause 32: Power to authorise entry in emergencies

Amendment 14

Moved by

14: Clause 32, page 23, line 32, at end insert—

“( ) An enforcement authorisation must be referred to a justice of the peace for evaluation within 48 hours, following the 48 hour period under subsection (7) in which the enforcement authorisation remains in force.”

Once again, a similar amendment was discussed in Committee. Clause 31 provides for a justice of the peace to be able to issue an enforcement warrant authorising entry or direct action in relation to the irregular or unauthorised carrying out of,

“spaceflight activities, operating a spaceport or providing range control services”.

Clause 32 provides for such enforcement authorisation to be given by the Secretary of State in an emergency where there are safety, national security or contravention of international obligation considerations at stake, and urgent action is needed. Such an enforcement authorisation would remain in force for 48 hours from the time when it was granted and would permit a named person to do,

“anything necessary … for protecting … national security … securing compliance with … international obligations”,

or protecting health and safety. However, despite these wide-ranging powers there is no provision in the Bill for any judicial oversight, as there is with the involvement of a justice of the peace in respect of an enforcement warrant in a non-emergency situation.

The House of Lords Constitution Committee has expressed its concerns on this point. The committee said that,

“we are concerned that such wide-ranging and potentially draconian powers would be exercisable without anticipatory or rapid post-hoc judicial involvement. We draw attention to these enforcement authorisations and call on the Government to consider post-hoc judicial approval of their use”.

This amendment would provide for an enforcement authorisation to be referred to a justice of the peace for evaluation within 48 hours, following the 48-hour period to which I have already referred and for which the enforcement authorisation remains in force.

In Committee the Government said they felt their approach was proportionate and contained sufficient safeguards to address the concerns raised while retaining the flexibility necessary to deal with the serious risks that the enforcement authorisation process was designed to address. I said in Committee that I would reflect on what the Government had said. I have done so; I hope the Government have done likewise and reflected on what was said during the debate, including the following points.

First, the Constitution Committee did not feel moved by the Government’s arguments, including on reducing the period of the enforcement authorisation to 48 hours. Secondly, there is no check to ensure that the draconian powers given under Clause 32 have not been abused—and, if there is no check and they have been abused once, it is highly likely that they will be abused again. Thirdly, the argument used by the Government in Committee about the alleged bureaucracy of having to find a justice of the peace is just not credible; and, fourthly, the Government’s argument in Committee that a review by a justice of the peace would place an unnecessary and disproportionate burden and cost on the judicial system really is clutching at straws. Perhaps the Government, if they are not going to change their stance, can tell us what the costs would be and how they would measure incurring those minimal costs against the abuse of the draconian powers provided for in Clause 32.

I hope that the Government will be able to say something helpful in reply and will go beyond reiterating the arguments they advanced in Committee, which clearly did not address the concerns of the Constitution Committee. I beg to move.

My Lords, I once again associate myself fully with the comments that have just been made. I am still struggling with the “anything necessary” line. Having defended those words so spiritedly in Committee, the noble Lord, Lord Callanan, is now escaping. Are we looking at enforcement at an economic level or at a national security level? I suspect there are already the necessary powers, were this to be a national security issue. There are sufficient powers to act with sufficient speed, with or without judicial oversight, in the event that it was a national security emergency that needed to be dealt with quickly. Therefore, it seems that we are looking at a commercial emergency—such a thing exists—and on that basis it seems to me that the points raised by the noble Lord, Lord Rosser, are entirely reasonable and we should not invest these draconian powers because we do not need to in dealing with that kind of issue.

I thank noble Lords for raising the question of emergency powers again. Since their interventions in Committee, we have been reflecting on this provision. I will do my best not to make all the same arguments that we made in Committee.

This amendment seeks to require that an enforcement authorisation issued by the Secretary of State is evaluated by a justice of the peace within 48 hours after the 48 hours that the authorisation has been in force. The enforcement authorisation issued under Clause 32 may be issued only under certain circumstances, which do not include a commercial emergency. They are: when there is an urgent case to act to protect national security; to ensure compliance with international obligations; or to protect people’s health and safety. The authorisation must be issued in writing to a named person and specify the action authorised to be taken. The authorisation itself will remain in force for 48 hours only. This reflects the urgent nature of the action considered necessary and requires it to be taken within a short period.

We referred to similar powers of other regulators in Committee, and we have tried to look across other legislation to ensure that we have the right balance here. Some of these powers are not subject to any review once they have been exercised. There is a precedent for this approach in the Consumer Rights Act 2015, which allows officers to enter premises without a warrant where it is suspected that there has been a breach of legislation, where giving notice would defeat the purpose of the entry, and where it is not practicable to give notice or where the entry is for the purpose of surveillance. The reasons for which an authorisation under Clause 32 may be issued are strictly related to emergency situations, and therefore are more restricted than the circumstances in the Consumer Rights Act. I should also clarify that improper use of the power by an appointed person under Clause 32 would be subject to judicial review, so it can be challenged if necessary.

The noble Lord, Lord Fox, brought to noble Lords’ attention the fact that warrants issued under the Investigatory Powers Act 2016 are subject to approval by a judicial commissioner within three working days of the warrant being issued. This is appropriate because these warrants remain in place for five days and relate to the sensitive practices of targeted interception, examination of the contents of communications and international assistance in such matters. This is not comparable to either the power under Clause 32 or the approach proposed by this amendment. Our advice from cross-Whitehall consultations is that there is no known precedent of a justice of the peace conducting an evaluation of an emergency power once it has been exercised.

We are also not clear what purpose evaluation by a justice of the peace would serve, as the order would be spent and the specified action taken by the time of the evaluation. It is also not clear what, if any, follow-up action would be available. I am afraid I cannot address the noble Lord’s concerns directly but we are continuing to reflect and will keep working with colleagues across Whitehall to ensure that we get a proportionate set of enforcement powers in the Bill, so that we can undertake spaceflight activities safely but also with regard to our national security and international obligations. I ask the noble Lord to withdraw his amendment.

I thank the Minister for her reply and thank the noble Lord, Lord Fox, for his contribution to the debate. I find it difficult when a Government say that they cannot understand what purpose a post hoc review of their action, or of a decision by the Secretary of State to issue the enforcement authorisation and whether it has been abused, would have. Clearly, if it had been abused, that would become known. Although I agree you cannot rectify the abuse that has already occurred, the thought that it might be drawn to public attention had it taken place would act as a deterrent, certainly in the future if it happened again. So I am puzzled that the Government do not apparently understand what the purpose would be of the review suggested in the amendment and, indeed, suggested by the committee concerned.

When the Minister says that the Government are still reflecting on this, once again I am afraid I am not entirely clear what exactly they are still reflecting on, bearing in mind that the Minister has not held out—at least, that is how it appears to me—any prospect at any later stage during the Bill’s proceedings of the Government perhaps coming forward with a proposal of their own if they do not like the look of the proposal in this amendment. When the Minister indicates that the Government are still reflecting on this, are they reflecting in the sense that they may come forward at some later stage in the Bill’s progress through Parliament with a proposal of their own that deals with, or at least addresses, the issues raised in the amendment?

As I say, we are still looking at some type of post hoc review. We are developing the options for that and trying to understand what the implications would be. That work is ongoing.

In the light of what the Minister has said about looking at a post hoc review, I am happy to withdraw the amendment.

Amendment 14 withdrawn.

Clause 34: Power of Secretary of State to indemnify

Amendment 15

Moved by

15: Clause 34, page 25, line 3, leave out “may” and insert “must”

My Lords, I rise to move Amendment 15. We put forward a series of probing amendments in Committee. The noble Lord, Lord Callanan, gave a long and detailed response to those, which I thank him for, which helped us understand how the various clauses relating to this whole issue work together. Unfortunately, there is just one point left. It is not at all complicated, and therefore I will not make a long speech about it, but this amendment addresses that single point.

Where the damage to an uninvolved third party exceeds the cap, and the insurance, the state must meet the excess. We are talking about a new phenomenon—flying bombs of one sort or another. The potential for catastrophic damage is there. It may not be very likely, but it could happen. It is potentially significantly more dangerous than the worst conceivable civil aviation accident at present, and it cannot be right that an uninvolved third party who suffers loss does not receive full compensation.

The Government have argued effectively to the House that the industry may need a cap and that it may not get off the ground without an appropriate arrangement. We agree, but if Her Majesty’s Government limit the operator’s liability, they must commit to making up the difference, and put that commitment in the Bill. I beg to move.

My Lords, listening to what the noble Lord, Lord Tunnicliffe, said, and the earlier debate about safety, one thing that occurred to me was seeing the newsreel footage of the crash of the “Hindenburg”, just before the Second World War—a crash that virtually ended the airship as a commercial prospect. That is a useful reminder that what may be seen as the next new thing could be disastrously impacted.

The simple message, which seems so obvious, is that if entrepreneurs considering coming into the industry have unlimited liability, they will not come in. If there is no cover—particularly, as the noble Lord, Lord Tunnicliffe, emphasised, for third parties—that would be totally unacceptable. The problem has been spelled out; the Government should face up to those contradictions.

My Lords, Amendment 15 relates to the liability provisions in the Bill. As my noble friend Lord Callanan outlined in Committee, these provisions are vital but complex.

I would just like to clarify a point my noble friend Lord Callanan made in Committee. He said that,

“the position under the Bill is exactly the same as that in the aviation industry—that operators have an unlimited liability to indemnify government”.—[Official Report, 16/10/17; col. 434.]

While it is correct that under aviation law an operator holds an unlimited liability, an operator is not required to indemnify the Government for third-party claims brought against it.

The requirement to indemnify the Government arises in this Bill and in the Outer Space Act 1986 only because under UN space treaties the UK Government are ultimately liable for the space activities of their nationals. Operators are therefore required to indemnify the Government for any claims brought against them as a consequence of their licensed activities. I hope that the House finds this clarification helpful.

With this complexity in mind, I should like to provide further background before turning to the amendment. Clause 33(5) provides a power to make regulations that enable a regulator to specify in a licence a cap on an operator’s liability arising out of its spaceflight activities to prescribed persons or in prescribed circumstances. These persons and circumstances would be set out in regulations, but we envisage that a cap, if imposed, would be on an operator’s liability to the uninvolved general public who suffer injury or damage as a result of spaceflight activities. The uninvolved general public will have a strict liability claim against the operator.

Further work needs to be done to check the appropriateness of capping an operator’s third-party liability. We plan to issue a call for evidence on issues relating to insurance and liabilities in early 2018, following Royal Assent to the Bill.

As this liability can be capped, Clause 34(3) provides the Secretary of State with a power to indemnify a claimant in the event of injury or damage caused by spaceflight activities. This means that the Government can pay compensation to the uninvolved general public in situations where injury or damage exceeds the operator’s capped liability amount.

As we have already emphasised, we are trying to put safety at the heart of the Bill. It is designed to ensure that spaceflight activity is as safe as possible in the first place, which will minimise liability arising. But, as noble Lords have pointed out, injury or damage could arise, and if it does, it is the Government’s policy that the uninvolved general public should have easy recourse to compensation. This policy does not and should not change if an operator has a capped liability or, for example, becomes insolvent and cannot meet all its claims.

I therefore understand the concerns that have led to this amendment which seeks to ensure that the Secretary of State has to pay compensation above the capped amount to the uninvolved general public. The liability provisions in the Bill are complex and we need to ensure that amendments in this area are appropriate and achieve what they are set out to do. We are working on this and look forward to tabling an amendment similar to this one in the other place, which I hope will allay the concerns shared by noble Lords that have led to this amendment. With that in mind, I ask the noble Lord to withdraw his amendment.

My Lords, I think that is a win. I see the noble Baroness nodding, and I take it that the Government will be tabling an amendment in the other place. On that understanding, I beg leave to withdraw the amendment.

Amendment 15 withdrawn.

Clause 36: Regulator etc not liable in respect of spaceflight-related actions

Amendment 16

Moved by

16: Clause 36, page 26, line 18, at end insert “or gross negligence”

My Lords, this takes forward a recommendation from the Science and Technology Committee in the other place that “gross negligence” should be on the face of the Bill, and that is what the amendment would do.

I thank the noble Lord, Lord McNally, for tabling this amendment, following a similar amendment that he tabled in Committee. We discussed Clause 36 in relation to the protection it affords a regulator. Having considered the persuasive points made by the noble Lord, and others, after reflecting on the wording of this new amendment, we agree that to achieve the right balance in this clause the regulator protection should not apply in cases of gross negligence, and we accept the amendment as tabled.

Amendment 16 agreed.

Amendment 17

Moved by

17: Clause 36, page 26, line 18, at end insert—

“( ) For the purposes of subsection (4) there is “gross negligence” on the part of a person or body if—(a) the person or body is in breach of a duty of care owed under the law of negligence, and(b) the conduct constituting that breach falls far below what can reasonably be expected of the person or body in the circumstances.”

Amendment 17 agreed.

Amendment 18

Moved by

18: After Clause 37, insert the following new Clause—

“Consultation on the licensing and insurance of small satellites

(1) The Secretary of State must, within the period of one year beginning with the day on which this Act is passed, lay before Parliament a report on any consultations on the licensing and insurance of small satellites that the Government has undertaken. (2) The report under subsection (1) must outline any regulations the Secretary of State intends to bring forward as a result of any consultation undertaken.”

My Lords, I am afraid that this is Groundhog Day all over again. We have discussed these issues and I will not go into the economics, save to say that there is huge potential for very high insurance costs for multi-satellite constellation launches. In Committee, the Minister said that work was in hand and would be finalised within 12 months of the Bill receiving Royal Assent, so the amendment was not necessary. I feel that it is necessary because this is the make or break economically of the nano-constellation-style satellite. Without resolution of this issue, there will be no industry in this regard because it will be too expensive to launch these satellites in this country. For that reason, while the work is in hand—and I accept in good faith that it will be completed—we believe that the amendment should be agreed. I beg to move.

My Lords, we support the general thrust of this proposal and hope that the Minister will say sufficiently warm words so that the amendment will not be pressed. I hope that she will be driven by the simple fact that the industry almost certainly will not get off the ground unless the Government can produce some assurance that appropriate legislation will be brought forward at some stage to enable small satellites to be economically effective.

I look forward to my noble friend’s reply and take this opportunity to say how exemplary the Government’s response has been on a range of issues that we have raised. If they responded in this way on a lot of other issues it would be very much easier for all of us. My noble friend has indicated in her delightful and charming way that she thought these amendments were worth while. Can we extend such a response more widely so that we do not have to have acrimonious discussions and then find ourselves with an amendment which is more or less similar to what has been proposed before? This is a very good example of that. People should always say thank you, and I do so.

I thank my noble friend for his kind comments. I hope to continue in my role as a transport Minister in an unacrimonious way. I am afraid that is as far as I can go: that is my brief.

During Committee, I was given the chance to talk about the work that the UK Space Agency is doing to improve the current licensing regime. I apologise again if this is a case of Groundhog Day: I need to reiterate that as I am afraid we still do not believe that the noble Lord’s amendment is necessary. We outlined the “traffic light system” that the agency is working on and work that was being undertaken on a policy model for insurance for constellations of satellites following feedback that insuring each satellite for a set level of insurance is prohibitively expensive. We think that the traffic light system and the insurance requirements for small satellites and constellations will do the job and that the industry will welcome them. We are holding a workshop in December this year. Very shortly after that, the UKSA will plan the implementation of the policy framework around that. That work will obviously be relevant to the Bill as, when it comes into force, it will regulate the operation of all the satellites in orbit.

Amendment 18 seeks to make it a requirement that a report is laid before Parliament on any consultations, and to include within that report an indication of the regulations proposed. We still believe that the amendment is not necessary. Laying a report before Parliament would be a duplication. It is our intention, in line with the Government’s consultation principles document, to issue a government response to the formal consultations to take place in relation to this Bill. This will, of course, be accessible to everyone.

We expect that the approach to the insurance and licensing of nano satellites under this Bill will mostly be set out within the guidelines and not within regulations, as is the case under the Outer Space Act. This is to enable the development of the policy in line with changing circumstances. I would like to take a moment to explain how we envisage those regulations and guidance working. In Clause 37, the Bill provides the power to make regulations setting out that insurance may be required to cover certain risks and liabilities. The regulations can also set out what the insurance should cover, what may or may not be excluded from the cover and the amounts of cover required. Licences for spaceflight activities are bespoke in nature. Requiring a fixed amount of insurance for the operation of a satellite in orbit within regulations may remove the flexibility necessary to increase or reduce the insurance required, depending on the risks of each mission. It is therefore envisaged that the regulations may set out the methodology for calculating the amounts of insurance without containing specific figures. The regulations will set out those situations where insurance is required, what type of insurance is required and what should be covered within the policy.

Clause 12 and Schedule 1 allow the regulator to include a condition within each licence that sets out the minimum amount of insurance that is required for that licensed activity. We intend to include such conditions in licences for the operation of small satellites. The published guidance will set out the amount of insurance required in line with the regulations. Such guidance could include the insurance requirements for small satellites under the traffic light regime if the policy intention is to treat those in a certain way.

As I set out during the first day in Committee, the purpose of the guidance is to aid policy implementation by supplementing the legal framework. The main benefit of the guidance is the flexibility to amend quickly and take into account changing events. These are areas where guidance may need to be amended regularly and in a timely manner. In the meantime, the UKSA will continue to engage with industry and interested stakeholders. We are confident that we will publish the regulations in due course. I therefore ask the noble Lord to withdraw Amendment 18.

I thank the noble Baroness for her letter on the subject of traffic lights, which I was pleased to receive. On a point of clarity, does the UK Space Agency, the Health and Safety Executive or some other body classify the risk of the launch? Who decides whether it is red, green or amber?

It will be the regulator of the launch, dependent on whether it is suborbital or orbital, therefore either the CAA or the UKSA. However, they will use the same framework.

We have exhausted this debate to a great degree. I still feel a little nervous that people are being asked to commit to a future industry when they are not sure how their satellites will fit into the Government’s regime and what the cost level of that will be. Therefore, there needs to be more clarity—if not in the Bill then issued in the guidelines—so that operators can be assured that they have an industry that they can afford to support. With that hope, I beg leave to withdraw the amendment.

Amendment 18 withdrawn.

Clause 38: Powers to obtain rights over land

Amendment 19

Moved by

19: Clause 38, page 27, line 27, leave out “expedient” and insert “appropriate”

My Lords, this group of amendments relates to land powers, a subject which attracted much debate in Committee. I have reflected on the concerns raised by the Committee, and I thank the noble Lords, Lord Tunnicliffe and Lord Rosser, the noble Baronesses, Lady Randerson and Lady Ford, and my noble friend Lord Deben for their close scrutiny of these powers. I will set out the amendments that we have tabled in response to their contributions.

The Government want to make it clear that the Bill will not give compulsory purchase powers to operators. We have sought to establish a proportionate set of land powers that are intended to be used only where appropriate. For this reason we have tabled Amendment 19, which replaces the word “expedient” with “appropriate” in Clause 38, as the former term was much criticised in Committee. This is intended to clarify the limited circumstances in which a Clause 38 order could be made. There is precedent for the use of the word “appropriate” in relation to the exercise of powers under other legislation. A few examples are the Airports Act 1986, the Armed Forces Act 2006 and the Civil Aviation Act 1982. I hope this amendment reassures noble Lords that the Government are serious about developing a balanced land powers regime that does not disproportionately impact landowners.

On Clause 40, noble Lords—including the noble Lord, Lord Tunnicliffe, and my noble friend Lord Deben—raised concerns in Committee about the lack of clarity regarding the temporary nature of the restriction on the use of land by orders under this clause in the current draft of the Bill. It is our intention that orders made under Clause 40 should be in force for only the shortest amount of time possible, and should be used only where no alternative arrangement can be negotiated with the rights holders and other interested parties.

Amendment 20 would remove Clause 40 and replace it with text that more clearly sets out the temporary restriction of use by such orders. This amendment, which is similar to the amendment to Clause 38, seeks to revise the language of the clause to reassure noble Lords that such orders will be made only where the Secretary of State considers it appropriate to do so. Further, subsection (1) of the proposed new clause explicitly sets out that orders would only temporarily restrict or prohibit the use of land or water for launch or landing.

We have also gone further. Orders made under this revised clause must specify the launch or landing that is proposed to be carried out and the period or periods for which the restriction or prohibition will apply. Orders must specify the relevant spaceport used and specify the area of land or water subject to the restriction or prohibition. This means that those affected will have greater clarity on the impact of the orders. They are able to challenge these restrictions using the objection process in Schedule 6, or can apply to quash orders under the process outlined in Schedule 7.

To reflect the temporary nature of restrictions or prohibitions under Clause 40 orders, we have consequentially tabled Amendments 23, 24 and 25 to Clause 44, which is headed “Registration of orders”. Temporary land orders made under Clause 40 would not be land charges and would not require registration in the land register in England and Wales or the equivalents in Scotland and Northern Ireland.

We have also tabled Amendments 26, 27 and 28 to Clause 48, which is headed “Amendment and revocation of orders”. The provision on orders under Clause 38, which is about powers to obtain rights over land, and paragraphs 4 and 5 of Schedule 9, which relate to statutory undertakers, remain the same as before. The amendments to this clause allow for amending orders made under Clause 40(1) to shorten or remove a specified period of restriction or prohibition on the use of land or water. An amending order made under proposed new Clause 48(2)(a), or an order revoking this order, becomes operative immediately after it is made and the Secretary of State must notify relevant persons about the order.

That means that, should a restriction no longer be necessary—for example, if three periods are earmarked for launch to mitigate the risk of adverse weather conditions but the first launch is successful—the relevant persons will be notified and individuals who wish to use the land or water will be able to do so immediately after the original order imposing the restriction is amended or revoked. This reflects the Government’s desire to limit restrictions on the use of land and water to the shortest period necessary, enabling local people to enjoy their rights fully except where safety necessitates those restrictions.

Any other amendments to extend or change orders made under Clause 40 will not be subject to this light-touch approach and will need to go through the full notification process set out in Schedule 6, which allows for objections to be made.

It is important to clarify that the original order would still be subject to the full notification process, enabling objections to be made to a proposal to make an order and enabling a challenge to that order once made by applying for a quashing order.

That brings me, finally, to the process for challenging orders made under Clauses 38 or 40. Noble Lords expressed many concerns about the availability of challenges for such orders as set out in the Bill. I have reflected on those concerns and would like to address them now.

Amendment 22 makes much clearer the options available for challenging orders made under Clauses 38 and 40. This amendment to Clause 42 provides for a new heading—“Challenges to and commencement of orders”. It sets out clearly that a proposal to make an order under Clauses 38 and 40 can be challenged through the process set out in Schedule 6. This allows those served with a notice 42 days to object to the proposed order. If they do so, the Secretary of State must call for a local public inquiry or arrange for objections to be heard in person. If the Secretary of State decides that, despite the objection, it is appropriate to continue to make the order, under the amendment it is clear that an order can be challenged under the process set out in Schedule 7.

The Government are serious about ensuring that local people have the right to object to any orders made under the Bill, and the process set out in Schedule 7 allows for challenge on grounds very similar to those for judicial review. The application to quash an order under this process would be considered in the High Court, and the remedy available would be the most appropriate one under a judicial review process. The amendment clarifies that this process is the only legal challenge mechanism for orders made under Clauses 38 and 40.

The challenge mechanism and the six-week time limit are consistent with tried and tested provisions in planning legislation. For example, legal challenges to most orders made under the Town and Country Planning Act 1990 are also subject to a six-week time limit.

I also remind noble Lords that under Clause 43 and Schedule 8 there is a comprehensive compensation provision. It allows for compensation to be recovered if the value of land is diminished, or if land is damaged or damages are sustained due to disturbance in the use of land as a result of orders under the Bill. Compensation may be claimed in relation to an order under Clause 38 from the person in whose favour the order is made. This will most likely be the holder of a spaceport licence or a provider of range control services. Compensation in relation to an order made under Clause 40 may be claimed from the spaceport operator.

A person who has an interest in land, including landowners, mortgagees and, in Scotland, creditors in a heritable security, may claim compensation under Schedule 8. Should any compensation dispute arise, this will be referred to the Upper Tribunal in England or Wales or the relevant Lands Tribunal in Scotland or Northern Ireland.

I now turn to Amendment 21, tabled by the noble Baroness, Lady Randerson, and the noble Lord, Lord Fox. I thank them for once again bringing our attention to the involvement of the devolved Administrations in the making of orders under Clauses 38 and 40.

Officials have been working with colleagues in the devolved Administrations during the development of the land powers in the Bill and have agreed an approach which the devolved Administrations have confirmed they are content with. I want to reassure noble Lords that local decision-makers, including the devolved Administrations, will be closely involved in any planning decisions related to spaceports. The orders under Clauses 38 and 40 do not interfere with local planning authorities’ ability to make planning decisions.

The Bill also sets out in Schedule 7 an objection process for applying to the court to quash an order, which provides an opportunity for the devolved Administrations to challenge specific orders. I hope that the noble Lord and the noble Baroness will feel able not to press their amendment. I beg to move Amendment 19.

My Lords, I am grateful for the detailed exposition from the Minister this afternoon, which has clarified a number of things. Amendment 21, in my name and that of my noble friend, would require the consent of the relevant Minister in the Scotland, Wales or Northern Ireland Governments before a land power could be created under Clauses 38 or 40. The Government have, on other issues, made many welcome concessions in relation to these sections. I am very grateful for the detailed letter from the Minister, which set out the Government’s response to questions I raised in Committee. I was reassured by the fact that the Government are looking at existing practice in the USA and New Zealand.

In our last debate, I asked what the Government meant by a “small area of land” and by the “vicinity” of the space launch site. It appears that in the US, regulations give the power to temporarily restrict access over a 2.2 kilometre radius from the launch point. In New Zealand, temporary restrictions on road use exist for six hours prior to a launch. Similar restrictions apply over areas of sea. On a densely populated island such as ours, such restrictions have a greater impact than in an area as extensive as the USA. We refer to potential spaceport sites as being in remote locations, but our definition of remote is certainly not that which would apply in the USA. Therefore, we are pleased indeed to see the increased precision provided by the Government’s amendments—for example, Amendment 20.

However, in our view, Amendment 21 deals with one important aspect that the Government’s amendments have not tackled. We have been told several times—indeed the Minister has repeated it just now—that the Welsh and Scottish Governments are supportive of the Bill. But that is rather different from their being content with the lack of specific reference to the need for the UK Government to gain the consent of Welsh and Scottish Ministers, or Northern Ireland Ministers when they exist. Support from the Welsh and Scottish Governments for the principle of the Bill does not mean their slavish support, for ever and a day, to its detailed outcomes.

In her response to me last time, the Minister referred to the example of the amendments made to the Equality Act 2010 as a result of the Bus Services Act. The Minister said that the Government thought it was appropriate to include reference to Welsh and Scottish Ministers in that Act, but,

“not strictly necessary, because the new regulation-making power was at the intersection of devolved and reserved matters”.—[Official Report, 23/10/17; col. 783.]

To take that forward, surely that argument applies equally here, where we have a Bill that refers to planning powers which are devolved and to a licensing process which is reserved.

I refer briefly again to the concerns of the House of Lords Constitution Committee on this issue. I gently suggest to the Minister, who has been gracious enough so far to deal with a number of concerns that have been raised in debate, that it might be tactful or sensitive to include reference to it here. A little good will at this stage might stave off problems in the other place and I urge her to look at this issue again.

I am sure the House will accept that the Minister wishes to be less precise than the noble Baroness would like her to be, although her spirit suggests that she might move a little towards what is proposed here.

I wish to say two things. I welcome these amendments. They show the care that we all have to take at the extension of ministerial power. Even the small difference between expediency and appropriateness is a big gulf when it comes to attitudes. Expediency is a subjective statement whereas appropriateness can properly be tested in an objective way. I welcome the changes that have taken place.

In the course of the debate it was suggested that other legislation was the same as this. I have looked at the other legislation—I am boring like that—and, having been a Minister, I know that people occasionally put before one a phrase which is perhaps ill advised. The other legislation is not the same—it is rather different. One of the things your Lordships’ House is here to do is to deal with tiny differences which, when they get on to the statute book, become serious. As I take more and more time to deal with questions of climate change and the like, I find that there are institutional barriers to things that are obviously sensible to do because, at some time at some place, no one looked at the wording properly to ensure it did not create circumstances which made decisions more difficult.

As I said earlier, my thanks for the amendments will be accompanied by a warning that it is important to use this House in the way in which it has properly been used on this Bill. My noble friend may feel that a little more in the direction of the devolved Governments would be helpful. Certainly I would like to know more about their willingness to support the legislation as it is. That is the centrepiece of this disagreement and, as we have so few disagreements now, it would be nice to get rid of this one.

My Lords, I would like to reflect briefly on what the noble Lord, Lord Deben, has said about the processing of this Bill. We will have a remarkably short Report stage, having had a good deal longer in Committee, because the Minister—I would say at our insistence but it would be unfair to suggest there was any resistance—has been willing to provide a great deal of time in private to work through the Bill in detail. There have been many concessions, which have been moved today and will form part of the Bill. This is an example of what an Opposition do best. The government concessions on land use and so forth add up to as good a deal as we think we are going to get, and the sensible thing for a good Administration to do is to take it. If we go any further we will end up dividing the House. We might or might not win, it then becomes a hostile environment, and things may get worse as a result. Therefore part of the process, unglamorous as it is, is to bank what you can.

I do not want to underestimate this because the Government have gone a long way in their concessions, but I will not recite them. I am pleased that the Minister has brought out the power in Clause 43; if she had done so in Committee I might not have made such a vigorous attack. That is because with our limited resources—I cannot think of a better way of putting it—we did not quite get to Clause 43. Certainly the compensation that Clause 43 refers to in Schedule 8 rounds off the land issues, so they are now as well rounded as they reasonably can be.

I share the view about Amendment 21, which I hope will not be pressed, but it would be good if the Minister could say a little more about it. I hope that the issue of reference to the devolved Administrations, which in successive Bills over the next several months we will be facing, is made a bit clearer. We must look at how it goes into future legislation. With that, I thank the Minister and all who have been involved not so much in this debate but in the wider debates both within and outside the Chamber for coming to what is a pretty good and rounded deal on the land issue.

My Lords, I am pleased that noble Lords have welcomed the amendments tabled on land powers. As a relative newcomer to your Lordships’ House and certainly to this ministerial position, it has been a pleasure to take on board the sensible suggestions which have been made and to include them in the Bill. I am afraid that I am not going to be able to satisfy the noble Baroness today on including the devolved Administrations in the Bill, but I would like to take the opportunity to spell out a bit more of our engagement with them.

We began the engagement process in early 2014 when we first met the Welsh and Scottish Governments to discuss our ambitions to promote the UK space industry. We have been engaged with them on an official level ever since to ensure that they are content with all the provisions of the Bill. Specifically on land powers, we have agreed an approach which they have confirmed they are happy with. Before the introduction of the Bill, we discussed the land provisions with the Scottish Government, the lands tribunals for Scotland and Northern Ireland, and the Registers of Scotland, and have since consulted the Scottish Civil Justice Council on the practical implications of orders under Clauses 38 and 40. They have all confirmed that they are content with the implications for their processes.

Orders made on Welsh land would be subject to the same registration process as those in England, and any tribunals that were to be involved would be the same ones as for England. The Minister of State for Transport, John Hayes, spoke last week to the Scottish Government Minister for Transport to update him on the progress of the Bill and the proposed amendments. In addition, my officials continue to engage the devolved Administrations of Wales, Scotland and Northern Ireland as the Bill makes its way through the parliamentary process. This includes sharing information on the proposed amendments tabled last week, with which the devolved Administrations have expressed that they are content. An opportunity for the devolved Administrations to raise any concerns about a specific order is, as I said earlier, provided in Schedule 6.

We expect that spaceport or launch operators or range control service providers will have already worked closely with local landowners and local authorities as they develop their plans for sites and launches. We also expect that, rather than orders under Clauses 38 and 40 being necessary, operators will negotiate with landowners for access to land.

I hope that this greater detail, combined with the amendments tabled by the Government to Clauses 38, 40 and 42, give reassurance to noble Lords. I hope also that the amendments demonstrate that the Government recognise the importance of land and ownership rights, as well as the importance of protecting the public during periods of spaceflight activities.

In response to the invaluable scrutiny of this House, we have sought to fine-tune our proposals to prevent unnecessary restrictions on land users and landowners. In addition, we have clarified the availability of a robust challenge process which provides those who wish to challenge with very similar grounds and remedies to those available through judicial review. The Bill also includes provision for just compensation where appropriate. I therefore ask the noble Baroness not to press Amendment 21.

Amendment 19 agreed.

Clause 40: Power to restrict use of land to secure safety

Amendment 20

Moved by

20: Clause 40, leave out Clause 40 and insert the following new Clause—

“Power to restrict use of land temporarily(1) The Secretary of State may by order temporarily restrict or prohibit the use of a specified area of land or water as a place for the arrival and departure of aircraft or spacecraft if satisfied that it is appropriate to do so—(a) to secure that a specified launch or landing may be safely carried out at a specified spaceport, or(b) to prevent a specified launch or landing at a specified spaceport from endangering persons or property.(2) An order under subsection (1) may not restrict or prohibit the use of an area of tidal waters that is beyond those of the territorial sea adjacent to the United Kingdom.(3) An order under subsection (1) must specify the period, or periods, during which the use of the specified area of land or water is restricted or prohibited.(4) Schedule 6 makes further provision in relation to orders under subsection (1).In that Schedule—(a) Part 1 applies to orders under this section that do not prohibit or restrict the use of water (“land orders”); (b) Part 2 applies to orders under this section that are not land orders.(5) It is an offence to contravene a provision of an order under subsection (1).(6) An offence under subsection (5) committed on tidal waters outside the ordinary jurisdiction of a court of summary jurisdiction may be tried and punished by such a court as if it had been committed in the nearest part of the United Kingdom that is within the jurisdiction of such a court.(7) Subsection (6), as it applies in relation to Scotland, does not confer jurisdiction on any court of summary jurisdiction other than the sheriff court.(8) Proceedings for an offence under subsection (5) may be instituted—(a) in England and Wales, only by or with the consent of the Secretary of State or the Director of Public Prosecutions;(b) in Northern Ireland, only by or with the consent of the Secretary of State or the Director of Public Prosecutions for Northern Ireland.(9) In this section—“launch or landing” means a launch or landing of a spacecraft or carrier aircraft;“specified” means specified in an order under subsection (1).”

Amendment 20 agreed.

Clause 42: Operation of orders

Amendment 21 not moved.

Amendment 22

Moved by

22: Clause 42, leave out Clause 42 and insert the following new Clause—

“Challenges to and commencement of orders(1) A proposal to make an order under section 38 or 40 may be challenged under paragraph 3 of Schedule 6 but may not otherwise be challenged in any legal proceedings.(2) An order under section 38 or 40 may be challenged under Schedule 7 but may not otherwise be challenged in any legal proceedings.(3) Subject to Schedule 7 and section 48(5), an order under section 38 or 40 becomes operative at the end of the period of six weeks beginning with the day on which the notice that the order has been made is published under paragraph 6(1)(a) or 8(1)(a) (as the case may be) of Schedule 6 .”

Amendment 22 agreed.

Clause 44: Registration of orders

Amendments 23 to 25

Moved by

23: Clause 44, page 30, line 38, leave out “and land orders”

24: Clause 44, page 30, line 40, leave out “or a land order”

25: Clause 44, page 31, line 6, leave out “or a land order”

Amendments 23 to 25 agreed.

Clause 48: Amendment and revocation of orders

Amendments 26 to 28

Moved by

26: Clause 48, page 33, line 12, leave out “a specified provision of this Act” and insert “section 38 or by paragraph 4 or 5 of Schedule 9”

27: Clause 48, page 33, line 16, at end insert—

“(2) The power to make an order that is conferred by section 40(1) includes a power—(a) to amend the order to shorten, or remove, a period specified as required by subsection (3) of that section;(b) otherwise to amend the order;(c) to revoke the order.(3) Immediately after making an order under the power specified in subsection (2)(a) or (c) the Secretary of State must serve on the relevant persons—(a) a copy of the order, and(b) a notice explaining the effect of the order and stating when it became operative.(4) The relevant persons are—(a) where the original order is a land order—(i) every owner, lessee and occupier of any of the land;(ii) every local authority within whose area any of the land is situated;(b) where the original order is not a land order—(i) any person who the Secretary of State thinks is particularly well able to bring the new order to the attention of those likely to be affected by it;(ii) every person who was served with a copy of a notice, under paragraph 8(1)(b) of Schedule 6, in respect of the original order.(5) An order made under the power specified in subsection (2)(a) or (c) becomes operative immediately after it is made.(6) The power specified in subsection (2)(b) is exercisable in the same manner and subject to the same conditions or limitations as the power to make the original order.”

28: Clause 48, page 33, line 17, leave out subsection (2)

Amendments 26 to 28 agreed.

Clause 51: Offences on board spacecraft: supplementary

Amendments 29 and 30

Moved by

29: Clause 51, page 34, line 31, leave out “an enactment creating” and insert “a provision that creates”

30: Clause 51, page 34, line 35, leave out “any such enactment” and insert “a provision that creates an offence”

Amendments 29 and 30 agreed.

Clause 66: Minor and consequential amendments

Amendment 31

Moved by

31: Clause 66, page 42, line 1, leave out subsection (3)

My Lords, in Committee last month, a number of noble Lords urged my noble friend Lord Callanan to reconsider the Henry VIII powers contained in Clause 66. The noble Lord, Lord McNally, highlighted the powerful arguments made by several speakers on this issue and recommended that the Government give thought to that between Committee and Report. I am pleased to say that we have followed his advice and have considered the arguments made by noble Lords. As a result, I have tabled these amendments, which will remove the Henry VIII powers from the Bill. I hope noble Lords will appreciate the considerable ground the Government have given. We have not taken this decision lightly; we recognise that there may be situations in the future that leave some legal uncertainty. However, we will continue to examine related legislation and address any omissions as necessary.

Amendments 34, 36 and 37 ensure that the power to make consequential amendments in Clause 67 is now limited to changes to secondary legislation made under the negative resolution procedure. Turning to Amendment 33A, we had an interesting debate on this same issue in Committee. I take it that my arguments then failed to convince noble Lords of the necessity of the subsection. However, the Government remain convinced that the subsection is needed to ensure that all aspects of the Bill can be fully implemented effectively.

As noble Lords are aware, the Bill provides powers to make regulations for specific purposes such as safety and security. However, there remains the possibility that due to the complex and evolving nature of spaceflight technology, we may need to supplement such regulations with regulations on other aspects of spaceflight and associated activities. The power in Clause 67(1) would only be used in such cases. I hope noble Lords are reassured by my explanation and feel able not to press the amendment. I beg to move Amendment 31.

My Lords, I see that the noble Lord, Lord Callanan, is in his place. I would like to say that he was sorely missed this afternoon, but unfortunately I cannot—we did not miss him at all. I can see that his popping in occasionally in the afternoon to this House of concord and agreement must be a pleasure, away from the hell of the Brexit department. It is good to see him. I do not know whether it was my eloquence or the fact that a former Lord Chief Justice—the noble and learned Lord, Lord Judge—applied his powerful arguments, but we welcome the Government’s concession.

I will not go into a great deal of detail on Amendment 33A. I will read out the section we want to delete:

“Regulations may make provision generally for carrying this Act into effect and for achieving the purpose set out in section 1(1)”.

Subsection 1 is equally catch-all. It states:

“This Act has effect for the purpose of regulating—(a) space activities, (b) sub-orbital activities, and (c) associated activities, carried out in the United Kingdom”.

That is far too wide-reaching.

I make one last plea to the Minister: perhaps we could have further talks involving the opposition—the Official Opposition as well, who put their names to this—to see whether we can get some different wording. We have done a lot of good work on this, but the wording is far too wide. I give her this Gypsy’s warning: if we send the Bill down to the other place with this subsection, it will cause just the same trouble. Parliament has to be very jealous of its privileges during the passage of Bills such as this. This is a bridge too far for anyone who cares about the need to keep powers within these two Houses. I am not going to press the amendment—it would be jarring to the spirit of the whole debate to have a Division at this stage—but if the Minister would agree to meet us and have one more go before Third Reading, that would be helpful.

The noble Lord, Lord McNally, said that widespread concern was expressed in Committee about Henry VIII powers in the Bill and the power they would give the Government to bypass Parliament when amending or repealing primary legislation. I too am grateful that the Government have changed their position. I suspect they were concerned that they would lose a vote on this in this House, and were probably far from sure they could put the Henry VIII clause back in the Bill when it got to the Commons. They would also have had the consideration that, at their behest, the Bill started in the Lords rather than the Commons, which is not the normal procedure for Bills containing potentially controversial clauses, as this one did until the government amendment was tabled. Henry VIII may be turning in his grave at these government amendments, but we welcome them.

On Amendment 33A, like the noble Lord, Lord McNally, I hoped the Government would be able to give some rather more convincing reasons than they gave in Committee for this catch-all regulation-making power being in the Bill. I am afraid the obvious conclusion is that once again, there is no movement because the Government have brought forward this skeletal Bill for their own party management reasons, one year before discussions on the regulations and nearly two years before those key regulations are placed before Parliament. As a result, frankly, the Government do not know what regulations will be needed. Even though this is a difficulty of their own making, they clearly think it quite acceptable to expect Parliament to agree to the wide-ranging regulation-making power Amendment 33A seeks to delete.

I share the view that it would help if this issue could be further discussed before the Bill leaves this House, which means before Third Reading. I also share the view that the subsection that Amendment 33A would delete will, if it remains in the Bill, be the subject of much discussion when it gets to the Commons. If the Government will not agree to delete it, it would be a lot better if it could be amended in some way. I hope they will think again on this issue.

I will attempt again to explain our opposition to the amendment. It would result in primary legislation being needed for such cases, including, for example, to make provisions for any developments in technology. This could lead to delayed launches from the UK and harm a burgeoning industry, so we are keen to maintain flexibility.

It is worth noting that the power’s scope is limited. Only regulations that relate to the regulation of spaceflight activities and associated activities can be made, as set out in Clause 1(1). I provided assurances in Committee on the limited scope of these associated activities. If regulations were to go wide of those and cover other areas, the Secretary of State would have exceeded his or her delegated authority and the decision would be subject to judicial review.

The Government have reflected on the concerns expressed about the powers contained in the Bill. We have gone a significant way towards addressing them by removing the Henry VIII power. The removal of Clause 67(1) would adversely impact on the Government’s ability to ensure that legislation relating to spaceflight was kept up to date. I can assure the noble Lord, Lord Rosser, that this Bill was brought forward to supply certainty to the industry, but I understand that concerns remain about the definition of “associated activities” and would be happy to meet noble Lords ahead of Third Reading. I ask noble Lords not to press their amendment.

Amendment 31 agreed.

Amendments 32 and 33

Moved by

32: Clause 66, page 42, line 3, leave out subsection (4) and insert—

“(4) Regulations under this section may not amend or repeal primary legislation.”

33: Clause 66, page 42, line 7, leave out subsection (5)

Amendments 32 and 33 agreed.

Clause 67: Regulations: general

Amendment 33A

Tabled by

33A: Clause 67, page 42, line 16, leave out subsection (1)

I am happy not to move the amendment for the moment. I would like to study carefully what the Minister has said, but I reserve the point that we may want to bring back the amendment at Third Reading.

Amendment 33A not moved.

Amendment 34

Moved by

34: Clause 67, page 42, line 40, leave out “66(4) or”

Amendment 34 agreed.

Amendment 35

Moved by

35: Clause 67, page 43, line 13, at end insert—

“(6A) The Secretary of State must carry out a public consultation before making regulations to which subsection (6) applies. Where the Secretary of State lays before Parliament a draft of an instrument containing such regulations, it must be accompanied by a report by the Secretary of State about the consultation.(6B) The duties imposed by subsection (6A) do not apply where the regulations amend other regulations and, in the opinion of the Secretary of State, they do not make any substantial change.”

Noble Lords will recall the wide-ranging debate on parliamentary oversight of secondary legislation that took place in Committee. The Government have reflected on the concerns expressed by noble Lords. As a result, this amendment will impose a statutory duty to carry out a public consultation before any regulations are made under the affirmative resolution procedure.

I hope that the amendment alleviates noble Lords’ concerns and reassures them of the Government’s intention to undertake full and wide-ranging consultation. This will also include a report by the Secretary of State on the consultation. As my noble friend Lord Callanan said in Committee, the Government’s intention is to carry out a public consultation that will invite a response from all interested parties, including noble Lords and trade unions.

Any subsequent regulations that materially changed the substance of the original instruments would also be subject to consultation. All noble Lords who have spoken on the subject will be notified of any public consultation. I beg to move.

In Committee, we expressed our concerns about the extensive use of secondary legislation to bring in provisions under this Bill due to the Government’s insistence on taking a skeletal Bill through Parliament literally years before the all-important regulations appear.

We also expressed our concern, as did the Delegated Powers and Regulatory Reform Committee, about the Government’s intention, in respect of many regulations, that the affirmative procedure be used only for the first regulations and not for subsequent regulations under the same relevant section of the Bill, which would instead be covered by the negative procedure.

The Government said in Committee that the development of the first sets of regulations would be subject to a stakeholder engagement process over the coming months and that they would then issue a full and wide-ranging consultation on each initial draft statutory instrument prior to their being laid. They also said that if there were any material change to the original instruments, there would be further consultation.

Government Amendment 35 seeks to put some of those undertakings in the Bill. While it does not address the concern about the negative procedure being used for subsequent regulations after the affirmative procedure for the first regulations, it provides a statutory requirement for a public consultation before regulations are made to which Clause 67(6) applies and for a report to be made by the Secretary of State about the consultation when a draft of such regulations is laid before Parliament. To that extent, and it is not a minimal extent, the government amendment represents progress and we welcome it.

Amendment 35 shows that some fertile minds have been at work since these issues were raised. Therefore, while I welcome the amendment, I suggest that the Minister puts those same fertile minds to work on Amendment 33A; then we might have an equally happy outcome at Third Reading.

Amendment 35 agreed.

Amendments 36 and 37

Moved by

36: Clause 67, page 43, line 17, leave out paragraph (a)

37: Clause 67, page 43, line 29, leave out “or section 66(4)”

Amendments 36 and 37 agreed.

Clause 68: Interpretation

Amendment 38

Moved by

38: Clause 68, page 43, line 41, leave out “includes an enactment contained in” and insert “includes—

(a) an enactment contained in subordinate legislation (within the meaning given in the Interpretation Act 1978);(b) an enactment contained in, or in an instrument made under, a Measure or Act of the National Assembly for Wales;(c) an enactment contained in, or in an instrument made under, an Act of the Scottish Parliament;(d) an enactment contained in, or in an instrument made under,”

Amendment 38 agreed.

Clause 70: Extent

Amendments 39 and 40

Moved by

39: Clause 70, page 45, line 27, leave out subsection (2)

40: Clause 70, page 45, line 34, at end insert—

“( ) Her Majesty may by Order in Council direct that any of the provisions of this Act extend, with any modifications specified in the Order, to—(a) any of the Channel Islands;(b) the Isle of Man;(c) any British overseas territory.”

Amendments 39 and 40 agreed.

Northern Ireland Budget Bill

Second Reading (and remaining stages)

Moved by

As noble Lords will know, it is now nine months since there has been a properly functioning Executive and Assembly in Northern Ireland. Yet despite this Government’s efforts over the last 11 weeks, the parties have not yet reached an agreement that would enable a sustainable Executive to form. In bringing the parties together for this most recent phase of the political talks, we have sought to help the DUP and Sinn Fein to bridge the gap on a small number of outstanding matters, including language and culture. In doing so, we have worked closely with the Irish Government in accordance with the well-established three-stranded approach. We remain prepared to bring forward legislation that would allow an Executive to be formed should the parties reach an agreement.

I share my right honourable friend the Secretary of State’s strong preference to see a restored Executive in Northern Ireland taking forward its own Budget. The Bill before us is one that we are taking forward with the utmost reluctance and only because there is no other choice available. We have been clear that the passage of legislation to set a Budget should not be a barrier to negotiations continuing, but the ongoing lack of agreement has had tangible consequences for people and public services in Northern Ireland. Without an Executive there has been no Budget, and without a Budget civil servants have been without political direction to take decisions on spending and public services in Northern Ireland.

I join the Secretary of State in paying tribute to the Northern Ireland Civil Service, which has demonstrated the utmost professionalism in protecting and preserving public services throughout these difficult times, but the powers it has been exercising have their limits. Under Section 59 of the Northern Ireland Act 1998, and Section 7 of the Government Resources and Accounts (Northern Ireland) Act 2001, they may issue cash and resources equal to only 95% of the totals authorised in the last financial year. These powers do not allow departments to use accruing resources, meaning that the resources available to departments are in reality significantly less than 95% of the previous year’s provision.

Noble Lords will recall that in Written Statements by my predecessors, the noble Lords, Lord Dunlop and Lord Bourne of Aberystwyth, in April and July, the Government set out an indicative Budget position and a set of departmental allocations based on the advice of the Northern Ireland Civil Service. The 19 July Statement said:

“The exercise of S59 powers cannot be sustained indefinitely”,

and warned that although we had not then reached that critical point, it was approaching. Those resource limits, in the absence of a Budget, are now fast approaching. Without further action there are manifest risks that the Northern Ireland Civil Service would simply begin to run out of resources by the end of this month. That would mean no funding available for public services, with all of the negative impacts that would accompany such a cliff edge. No Government could simply stand by and allow that to happen. That is why we need the Bill.

To be clear, this is a measure we have deferred for as long as possible. We wanted to see the parties reach an agreement and take a Budget through themselves. In the absence of agreement, the Bill is necessary to keep public services running in Northern Ireland and, while it is a government Bill, it is not a UK government Budget. It does not reflect the priorities or spending decisions of the Secretary of State for Northern Ireland or any other UK government Minister. Rather, it sets out the departmental allocations and ambits that have been recommended by the Northern Ireland Civil Service, which, in turn, has sought as far as is possible to reflect the priorities of the previous Executive, albeit updated to reflect the changed circumstances as far as has been required. In short, it is the Budget that a returning Executive—had one been formed—would have been presented with. Taken as a whole, it represents a necessary measure, taken at the latest possible point, to secure public finances in Northern Ireland.

We should be absolutely clear that passing this Budget in Westminster does not mean a move to direct rule, any more than did this Parliament legislating to set a regional rate in April. Once the Budget is passed, the detailed decisions on how it is spent will be made by the Northern Ireland Civil Service. If the parties come together to form an Executive in the weeks ahead—as I am sure all noble Lords hope will be the case—those decisions would fall to them. Nothing we are doing today precludes talks from continuing and an agreement being reached.

I now turn briefly to the contents of this short but rather technical Bill. In short, it authorises Northern Ireland departments and certain other bodies to incur expenditure and use resources for the financial year ending on 31 March 2018. Clause 1 authorises the issue of £16.17 billion out of the Northern Ireland Consolidated Fund. The allocation levels for each Northern Ireland department and the other bodies in receipt of these funds are set out in Schedule 1, which also states the purposes for which these funds are to be used.

Clause 2 permits some temporary borrowing powers for cash management purposes. Clause 3 authorises the use of resources amounting to £18 billion in the year ending 31 March 2018 by the Northern Ireland departments and other bodies listed in Clause 3(2). These figures and those in Clause 1 supersede the allocations of cash and resources made by the Permanent Secretary of the Department of Finance up to the end of this month, under the powers I have already mentioned. Similarly to Clause 1, the breakdown between these departments and bodies and the purposes for the authorised use of resources under Clause 3 are set out in the Bill, in the first two columns of Schedule 2.

Clause 4 sets limits on the accruing resources, including both operating and non-operating accruing resources, in the current financial year. These sums relate to those which have already been voted by Parliament via Main Estimates, together with revenue generated locally within Northern Ireland. There is no new money in the Bill: there is simply the explicit authority to spend in full the monies that have already been allocated.

Ordinarily, the Bill would have been taken through the Assembly. As such, in Clause 5, a series of adaptations ensure that—once approved by both Houses in Westminster—the Bill will be treated as such, enabling Northern Ireland public finances to continue to function notwithstanding the absence of an Executive. Clause 6 repeals previous Assembly Budget Acts, relating to the financial years 2013-14 and 2014-15 respectively, which are no longer operative. Such repeals are regularly included in Assembly Budget Bills.

Alongside the introduction of the Bill in the other place yesterday, a set of estimates for the departments and bodies covered by the Budget Bill was laid before the House as a Command Paper. These estimates, which have been prepared by the Northern Ireland Department of Finance, set out the breakdown of the resource allocation in greater detail. As noble Lords may note, this is a different process from that which we might ordinarily see for estimates at Westminster, where the estimates document precedes the formal Budget legislation and is separately approved. That would also be the case at the Assembly. But in these unusual circumstances, the Bill provides that the laying of the Command Paper takes the place of an estimates document laid and approved before the Assembly, again to enable public finances to flow smoothly.

To aid the understanding of these Main Estimates and how the spending will break down, the Northern Ireland Civil Service has published a Budget briefing paper, which was published on the Department of Finance website on Monday morning. It is important to note that the Northern Ireland political parties have also been briefed on this Budget position.

As those clauses demonstrate, this is clearly an unusual Bill to be taken through the UK Parliament, marking as it does an approval by Parliament of spending in the devolved sphere. While being proportionate, the UK Government want to ensure that in the absence of an Assembly there can be appropriate scrutiny by Parliament of how the money it has voted is subsequently spent. In addition to the provision in the Bill for scrutiny by the Northern Ireland Audit Office of the Northern Ireland departments, my right honourable friend the Secretary of State will be writing to the Comptroller and Auditor-General for Northern Ireland asking for a copy of each of the NIAO audit and value for money reports produced after the Bill gains Royal Assent, which will contain the Comptroller and Auditor-General’s view on any shortcomings and his recommendations for improvement. The Secretary of State will ask the Northern Ireland Civil Service to make its responses to those reports available to him. Copies of these reports and correspondence will be placed in the Libraries of both Houses to allow scrutiny by all interested Members and committees.

I have already noted that the Bill deals solely with moneys already voted for by Parliament or raised within Northern Ireland. Those figures do not, though, secure the financial picture for the long term, where real challenges remain. There is a health service in significant need of transformation; there are further steps to take to build the truly connected infrastructure that can boost growth and prosperity throughout Northern Ireland; and there is a need to continue to deal with the legacy of the past. It was in recognition of those unique circumstances that the UK Government were prepared to make additional financial support available earlier this year, following the confidence and supply agreement between the Conservative Party and the DUP. That agreement made it clear that we wanted to see that money made available to a restored Executive, which would decide on a cross-community basis how best to use the funding for the benefit of all in Northern Ireland.

Northern Ireland’s unique circumstances cannot simply be ignored in the meantime, especially given the pressures that we have seen in the continued absence of an Executive. So in addition to the Bill, this Government will commit to making available the £50 million in the agreement for addressing immediate health and education pressures in this financial year. Those sums are not contained in the Bill, because they have not yet been voted by Parliament. If the Northern Ireland Administration confirm their wish to access them, they will be subject to the full authorisation of the UK Parliament, as with all sums discharged from the UK Consolidated Fund, via the estimates process in the new year. From there they will be transferred, along with other sums forming part of the Northern Ireland block grant, into the Northern Ireland Consolidated Fund.

In the absence of an Executive, it would be for the Northern Ireland Civil Service, which is bound by a range of equality and propriety duties, to make the decisions as to whether and how to take account of this funding for the benefit of the whole community. We want to see a restored Executive back in place and deciding on how the additional financial support can best be used for the benefit—I stress again—of the whole community. That remains the case now, as much as it ever was. We believe in devolution. We want to see locally elected politicians taking the strategic decisions about the future direction of their local areas.

In this context, I know the disappointment so many feel that despite the election more than eight months ago, there remains no functioning Assembly in which all those elected may serve. The Government understand the concerns that many have that full salaries continue to be paid to Assembly Members, despite this impasse, but we also recognise that many of those elected have been desperate to serve since March and have continued to provide valuable constituency functions in the meantime. That is why my right honourable friend the Secretary of State told the House of Commons yesterday that he is seeking independent advice on the subject from Mr Trevor Reaney, a former Clerk of the Northern Ireland Assembly. Mr Reaney has agreed to provide an independent assessment of the case for action and the steps he would consider appropriate. He will report to the Secretary of State by 15 December and his advice will help inform the best way to proceed.

I very much hope that his work will not be needed. That is because I still hope that the parties can resolve their differences and an Executive can be formed—an Executive that will come together and take the strategic decisions needed on health transformation, educational reform and building world-class infrastructure to deliver a better future in Northern Ireland. That is what the people of Northern Ireland voted for and want to see. We will continue to work with the parties and support them in their efforts to reach a resolution for, together with the Irish Government, we remain steadfast in our commitment to the 1998 Belfast agreement and its successors, and to the institutions they established.

It remains firmly in the interests of Northern Ireland to see devolved government restored and locally elected politicians making decisions for the people of Northern Ireland on key local matters. Northern Ireland and its people need a properly functioning and inclusive devolved Government, along with effective structures for co-operation—north-south and east-west. At the same time, the Government are ultimately responsible for good governance in Northern Ireland and we will do whatever is necessary to provide that. The Bill is a reminder of the underlying obligation that we will continue to uphold and I beg to move that it be read a second time.

My Lords, it is a great privilege and pleasure to be able to take part in this very important debate on a very small Bill. First, however, I welcome the Minister to his position. I think that this is the first speech he has made in the Chamber regarding Northern Ireland, and I think he did a great job of it, bearing in mind the circumstances in which it was delivered.

I shall touch on the issues affecting security in Northern Ireland that occurred over the weekend. It was particularly unfortunate that it occurred in Omagh, which has seen such terrible devastation in the past, and was so reminiscent of what occurred in Enniskillen. It shows that if there is no progress politically in Northern Ireland, vacuums are created that can sometimes be filled by men and women of violence.

Of course I support the Bill; we cannot do anything else. There has to be a Budget in Northern Ireland. I was for two years the Finance Minister in Northern Ireland and I understand the issues. We have to pay for public services, so I doubt whether there is anybody in this Chamber who would disagree with the fact that the Bill is necessary.

I think that there is an issue of accountability. This is a Westminster Parliament and a United Kingdom Government bringing in a Bill on a Budget for Northern Ireland without any political involvement from elected politicians in Northern Ireland so far as the Assembly is concerned. In his wind-up, will the Minister address the issues of accountability? He has mentioned the auditors and the Comptroller and Auditor-General, but they are not politicians. They are civil servants who have to draw up and then check their own budgets, in a sense, even though they are from a different department. If this continues for any length of time, there may be a role for, say, the Select Committee on Northern Ireland in the other place to look at the Budget or for Parliamentary Questions to be tabled in both Houses. I will be grateful for the Minister’s views on that.

I want to touch very briefly on the Secretary of State’s role in all this. He has done a very good job. He has been extremely committed, very sincere and very hard-working and has done his level best to try to bring, particularly, the two main parties in Northern Ireland together. No one can fault him on doing that, but I think that all would agree that today is a major turning point in events in Northern Ireland and in the United Kingdom for those of us who are interested in and committed to the future of Northern Ireland. It may not be de jure direct rule, but it may be de facto direct rule and that we are almost drifting towards direct rule and the end of devolution. That is a stark warning to everybody involved in Northern Ireland and to the political parties, particularly the two main parties. To be fair to the DUP, it has always supported devolution. It has been a devolutionist party. It wants devolution to occur in Northern Ireland, but it ought perhaps to look again at the issues, for example with regard to the Irish language Act.

I understand the issues—I come from an English-speaking part of Wales. Roughly 25% of the population of Wales speaks Welsh, but not in my area. Ironically, it was a Conservative Government who brought in the Welsh Language Act, and there were difficulties. But I hope that the DUP negotiators and those who have been involved in these matters can look towards another part of the United Kingdom with regard to how we deal with language issues and see that the union has not fallen apart because there was a Welsh Language Act in Wales.

So far as Sinn Fein is concerned, of course it is right to worry about parity of esteem for both sides in the community, but one has to ask whether it is worth dismantling the whole apparatus of government—the Executive, the Assembly and everything that goes with it—when you can have talks with the Government in parallel? Why on earth should we not have an Assembly and an Executive in Belfast who deal with health, education and all the other issues, but at the same time have parallel talks rather than bringing it all down?

Of course the other irony in this is that Sinn Fein—like other parties in Northern Ireland, but particularly Sinn Fein—has argued for the last 20 years or so that the Good Friday agreement is something by which all should abide. The Good Friday agreement includes the establishment of an Executive and an Assembly. I chaired the strand 1 talks, and it was an integral part of the whole agreement. When the people of Ireland, north and south, voted on that agreement, they voted on the establishment of an Executive and an Assembly. The sooner and the quicker those are up, the better. The Government need to perhaps have another look at the way in which they deal with the negotiations in the coming weeks, negotiations which I am sure will continue. My honourable friend Owen Smith, the shadow Secretary in the other place, has touched on some of the issues, and I would like to touch on just one or two before I conclude.

The first has been mentioned many times—I mentioned it to the Minister last week. There is a case for the Heads of Government—the Prime Minister and, where appropriate, the Taoiseach in Ireland—to involve themselves more directly in trying to solve this problem. Quite frankly, telephone calls are not good enough. Given the weight of the positions of Prime Ministers, actually going to Belfast, getting the parties together and talking to them would be hugely symbolic and hugely positive. It might not work—sometimes it did not. In Leeds Castle, that approach did not work. But with the Good Friday agreement, the St Andrews agreement and other agreements, it did. However, it simply has not been tried. That should be looked at really seriously from a Heads of Government point of view.

There should also be round-table, all-party talks in Northern Ireland. Yes, of course the DUP and Sinn Fein are the two biggest parties. Yes, of course they should be talking to each other all the time. But there are other parties in Northern Ireland too. There is a point to bringing them all together, because they can interact with each other, give ideas to each other and embarrass each other. They can get round a table and try to resolve these things. Again, could the Minister liaise with his right honourable friend the Secretary of State to try to achieve that?

There is also a case—it might take legislation but it would be worth it—for the Assembly itself actually to meet and deliberate. When I was Finance Minister, in 1999 I think it was, I went to the Assembly and presented the Budget. For a whole afternoon, Members of the Assembly from all parties were able to question me about the contents of that Budget. Why can they not do that on this occasion? Bringing together Members of the Assembly in Stormont means that they are again coming face to face and might be able to come up with a resolution of the issues that divide them.

Direct rule, if it comes back, will not be a solution but a tragedy. It is so very easy for it to return, but so very difficult then to restore devolved government. I was five years as a direct rule Minister in Northern Ireland, and although I thoroughly enjoyed it and appreciated the political role that I had, I was always embarrassed at being a direct rule Minister. I was a Member of Parliament for a Welsh valley constituency: not one person in Northern Ireland had voted for me, but I had to take decisions on health, schools, roads and local government. It is wrong. Those decisions should be taken by people in Northern Ireland elected by people in Northern Ireland, particularly given that in the House of Commons there are 650 Members of Parliament, but only 17 come from Northern Ireland, and not one nationalist voice is heard in that Chamber. That cannot be right when it comes to bringing the Government to account for what they do for Northern Ireland. I do not think direct rule is an answer.

Nor should this Bill be an excuse to give up. The issues that we had to consider 20 years ago—prisoner releases, the police, the courts, the establishment of institutions, relations between the north and south of Ireland, and many others—were resolved by talking. There is no reason in this wide world why we cannot do that again.

Overhanging all this mess is the business of Brexit and the fact that in only the past week or so, the European Union has again raised the issue of the border: a huge issue for everybody, north and south—and for all of us in the United Kingdom and in Europe generally. There is no voice from Northern Ireland. There is no Minister, not one person elected from Northern Ireland, who is addressing these issues. The sooner that is done, the better.

My Lords, it is always a great pleasure to follow the noble Lord, Lord Murphy, with all the experience and wisdom that he brings, and we had a fantastic example of this evening.

We on these Benches will support the Bill this evening. In the present circumstances, we believe that it is now essential. It is deeply disappointing that we have found ourselves in this position, but we recognise our obligation to the people of Northern Ireland to ensure that public services can continue. The Civil Service has been working on these assumptions, so the Bill is now required to give the legal authority to the full 100% cash flow needed, rather than the 95% allowed under Section 59 of the Northern Ireland Act 1998.

However, this position is far from ideal. The figures reflect the assumptions and the emerging Budget that the Sinn Fein Finance Minister was poised to recommend in January this year. However, there had already been delays to that Budget process, so a Budget had not been passed by the Assembly at the point of the Executive’s collapse in January. Moreover, the DUP and Sinn Fein had not agreed an economic strategy, a social strategy or an investment strategy for the financial year 2017-18.

I am deeply concerned that the Budget for next year—2018-19—will be considerably more challenging than the Budget before us today. Normally, a draft Budget would be going out for public consultation about now. Under normal circumstances, we would expect a draft Budget to be agreed early in 2018. I am concerned that it is now entirely possible that this process could drag on beyond the start of the new financial year.

As I said during the Statement last week, it has now been 10 months since the Executive collapsed. Northern Ireland is showing the strains of this political vacuum, with no one able to take the strategic and political decisions that are needed to grow the economy, ensure effective public services and build the shared society that we all want.

We are extremely concerned that in the absence of clarity about governance, there is no clear authority to put in place decisions and reforms that would allow money to be spent more efficiently and effectively. As a consequence, Northern Ireland is building up more and more problems for next year, and I am concerned about the impact that this will have on its people.

Setting a Budget is the most important act that any Government take. Robust public finances underpin the provision of services and economic growth. Public finance in Northern Ireland has needed significant reform for decades, and the financial difficulties predate the current crisis, but these continual crises are undermining public services and preventing Northern Ireland’s economy improving. The creation of a stable Budget is essential for Northern Ireland’s progress. The divided nature of Northern Ireland society exacerbates the economic problems that it faces. Major distortions remain within the provision of public services within the context of a divided society. This is not just a legacy issue; this pattern of duplication in service delivery continues to be replicated. Tackling the cost of division is by far the most significant long-term financial challenge facing Northern Ireland, but this is not being addressed in the current political vacuum.

Does the Minister recognise that, as well as the direct costs of policing civil disturbances and repairing damaged buildings and facilities, there are also indirect costs of providing duplicate goods, facilities and services for separate sections of the community, either implicitly or explicitly? These costs are borne not just by the public sector but by the private sector. Does he realise that divisions within society and a lack of political stability mean opportunity costs too, particularly related to lost inward investment into Northern Ireland and tourism? The Secretary of State recognised that in his speech in Brussels on 6 November, when he said:

“In Northern Ireland today over 90 per cent of public housing is segregated along sectarian lines. Over 90 per cent of children in Northern Ireland are educated separately … Indeed some independent estimates put the cost of division in Northern Ireland at around £1.5 billion. So bringing people together … and building a stronger, more shared society has to be an urgent priority”.

Does the Minister support efforts by the Alliance Party of Northern Ireland to require all departments to actively encourage de-segregation and to promote cohesion, sharing and integration within their policies and spending plans?

The Budget before us today is essential to ensure the full provision of resources for public services and to provide the legal authority to spend. But passing a Budget does not address the governance gap in Northern Ireland. Therefore, these scarce resources cannot be spent efficiently and effectively, and key reforms cannot be progressed. Even at this late stage, as the noble Lord, Lord Murphy, has set out so clearly, there may be alternative ways to save devolution and to provide for shared and sustainable government in Northern Ireland. There are proposed interventions: for example, bringing in an external mediator; a different format for the talks; and reform to structures and mechanisms that can better incentivise progress.

I urge the Minister to consider all the options to restore devolution so that we do not throw away the hard-won gains of recent decades. It must be possible to find creative solutions to the current impasse, and we urge all those involved to redouble their efforts.