Tuesday 30 November 2021
[Esther McVey in the Chair]
UK-EU Fisheries Allocations
Before we begin, I remind Members that they are expected to wear face coverings when they are not speaking in the debate, in line with current Government and House of Commons Commission guidance. I remind Members that they are asked by the House to have a covid lateral flow test twice a week if coming on to the parliamentary estate, which can be done either at the testing centre in Portcullis House or at home. Please also give each other and members of staff space when seated, and when entering and leaving the room.
I beg to move,
That this House has considered allocations to UK-EU fisheries following the UK’s departure from the EU.
Thank you, Ms McVey, for allowing me to speak. I especially thank the Backbench Business Committee for allowing this debate. We all tend to think that somebody else is going to request a debate on this topic, but when I spoke to the Committee Chairman, the hon. Member for Gateshead (Ian Mearns), I realised that that had not happened. Therefore, we arranged it very quickly on Thursday evening and Friday morning, and were kindly given this spot.
It is so important to have this debate, and it is a pleasure to see so many right hon. and hon. Members in their places. I am especially pleased to see the Minister in her place. She has a wonderful appreciation of fishing and a good working relationship with the fishing organisations in Northern Ireland. They speak highly of her. I know them well, so I know that when they speak highly of somebody, they have earned it—well done for that.
Last Friday was a grey, breezy and cold day at Portavogie, Kilkeel and Ardglass harbours in County Down. Part of the fleet was in port, part of the fleet is scattered around the British Isles, and some of them are fishing in the North sea. Others have diversified into offshore, energy-related projects and are deployed away from home. Some of the trawlers opted to stay at home and were tied up at the beginning of October, and they have no plans to put to sea until the new year. The prawn fishery is the mainstay of the County Down fleet and, by and large, catches drop off during the autumn. I hold an advice surgery in Portavogie on the second Saturday of every month, and my workload comes from the fishing issues in the village. Seasonal gales impact on fishing operations, too, as does the increased cost of fuel, which, other than crew wages, is the single biggest overhead for a trawler and has impacted substantially on the profitability of fishing operations, adding to the challenges.
Those are the factors that fishermen have to deal with year to year. However, in autumn 2021 they have been further complicated by the political closure of fishing grounds that fall within the maritime zone of Ireland, or the EU, in the Irish sea. As I often do, I will provide a Northern Ireland perspective—I am sure that hon. Members would be disappointed if I did not. The particular reason that I want to provide that perspective is that I represent the second biggest fishing port in Northern Ireland.
The sea border with Ireland is only a few minutes’ steaming time from Kilkeel. At this time of the year, access to those waters is vital for the local fleet. However, 11 months into the new relationship with the EU, issues such as mutual access by fishermen from both parts of the island to the waters are yet to be fully resolved.
A key concern of industry is that the Government have not been clear about the benefits gained and losses made by leaving the EU. Does the hon. Member agree that the Government must prioritise transparency and engagement with the industry?
I do agree with that. That is one of the thrusts of my comments this morning: the Minister and the Government must ensure that we have transparency and a settled perspective for the fishing fleets in Kilkeel, Portavogie in my constituency, Ardglass and across the whole of Northern Ireland.
French fishermen and the French Government complain about the UK not issuing enough fishing licences to fish in waters off the south coast of England. The sentiment in Northern Ireland is that we wish we had half of France’s problems when it comes to fishing opportunities and the ability to catch fish whenever we can. Following the 2016 referendum, a wagon train—or, to use a pun, a boatload—of officials from London visited County Down to gain an understanding of the fishing fleets’ operations and the path to market for seafood landed at the ports. The interdependence of fishing operations was recorded multiple times. The routes to the markets in GB, the EU and further afield were clearly explained. What was the result of that? We are still wondering.
The first part was the Ireland/Northern Ireland protocol. Senior fisheries officials from the Department for Environment, Food and Rural Affairs visited Northern Ireland in early January 2020 to proclaim the benefits of the protocol for the fishing industry. We do not see those benefits. The “best of both worlds” was proclaimed on the tin and we heard that the proof of the pudding would be in the eating—we heard all the wee puns that we all use every day—but, as we often find, the devil is in the detail.
I understand what the hon. Gentleman is talking about, having been to Portavogie and Kilkeel myself. Does he agree that one of the complications of the protocol relates to the movement of fish, particularly prawns and scampi, from Scotland to Northern Ireland? None of it is marketed in Northern Ireland, because it all goes back to Whitby, in my constituency, to be processed. Does he agree that this is a problem that needs sorting out? The movement between GB and Northern Ireland is not just about retail, but about processing goods as well.
The right hon. Gentleman is absolutely right and I thank him for identifying that issue. He is a fellow member of the Northern Ireland Affairs Committee and I am very pleased that we visited Portavogie. I also know that he has a particular interest in fishing. Just last week, we discussed some fishing industry issues that were of interest to both of us, and we are on the same page on them.
On 24 December 2020, the second part of the result was unveiled: the trade and co-operation agreement. The UK’s objective of becoming an independent coastal state was realised. Increased shares of fishing opportunities were secured, albeit at lower levels than in the expectations that had been raised by London.
What did that mean for local fishermen? According to the protocol, access to the EU market would be near seamless for seafood from Northern Ireland. That was good news, but there was one issue: fishermen would have to catch and land the seafood before they exported it, as referred to by the right hon. Gentleman. Regardless of neighbourhood agreements dating from the 1960s, Northern Ireland fishing vessels were excluded from all waters around Ireland, and vice versa, from 1 January.
The neighbourhood or voisinage agreement extends to inshore waters. Significant economic pain was endured until this matter was resolved in mid-2021. As we approach the first anniversary of the TCA, waters between six and 12 miles remain out of bounds, yet, right now, it is access to these waters that counts. To use an analogy, they are like a farm that straddles the land border. Imagine the headlines if a landowner was unable to work his land on the other side of the border to which he lives. We have examples of that in Northern Ireland, as my hon. Friend the Member for East Londonderry (Mr Campbell) is aware.
This is particularly frustrating because, despite the hours upon hours of explaining these issues to officials from London, and despite Dublin exuding its desire for free trade between both parts of the island, a deal was struck with the EU that ignored fishery access issues around the island of Ireland. The frustration that fishermen in my constituency and across Northern Ireland have is palatable. The TCA permitted access for EU fishermen—French fishermen—to waters off England’s south coast. English fishermen continue to be abhorred by that, and we support them.
To cap matters off, the TCA confirms that fishermen from the Isle of Man can have access to Irish or EU waters in the Irish sea, from which Northern Ireland’s fishermen remain excluded. My goodness, it is hard to believe. You could not write this story. You could not make this up. It is quite unbelievable.
Leaving the critical issue aside, there is then the issue of getting the fish and shellfish ashore so they can be processed, packed and exported. That is the very issue referred to by the right hon. Member for Scarborough and Whitby (Mr Goodwill). Fishermen can catch a fish beyond the harbour at Portavogie, Kilkeel or Ardglass, but when they bring it back in they are subjected to all sorts of rules, tariffs and levies.
Some £100 million-worth of seafood is exported annually from Northern Ireland. Around 60% by value goes to GB, including to Whitby and other places, while 30% goes to the EU and 10% to the rest of the world. The protocol and the TCA combined confirm that the waters around Northern Ireland, including the water that local fishing vessels float on in their home ports, is sovereign UK territory. It is the land mass that is the EU’s single market. Remember that what we currently have is implementation of some 20% of the protocol. It has permitted seamless trade between Northern Ireland and the EU, but what would the result be if the protocol was implemented in its entirety, as some would like?
It is ironic that if the protocol is implemented in its entirety, every time a locally owned fishing vessel, based in a local harbour such as Portavogie in my constituency, returned to its home port in Northern Ireland, it would have to comply with EU regulations requiring it to act as though it came from a third country—my goodness—such as Iceland, Norway or Russia. Northern Ireland’s fishermen would be foreigners in their home ports. It is simply absurd. It is hard to comprehend or understand, or to even find out why this is happening.
My hon. Friend is alluding to the foolhardiness of some public representatives talking about the rigid implementation of the protocol, and has quite rightly alluded to the problems that would come about if it were to be fully implemented. Does he agree that this is all the more reason to put in place a specific, bespoke problem-solving process to bring this matter to a head between the EU and the United Kingdom Government, to try to resolve what, in the grand scheme of things, are comparatively small problems between the EU and the UK?
I thank my hon. Friend for that contribution, and I agree wholeheartedly with him. It seems to us that the problems are not insurmountable: they can be overcome if there is a willingness to find a solution. I believe our Government are willing to do so, but I do not think there is the same willingness among the EU to participate and come up with solutions. My job, as a public representative—everyone else probably feels the same—is not about problems, but about solutions. We have solutions, so let us make sure that through our Minister and our Government, we can achieve them.
My hope will always be that that committee will come up with workable solutions, so that we can solve some of these problems. However, this has gone on for so long that we are now getting to the stage where, if we do not do something quickly, we are going to have really serious problems.
Her Majesty’s Government have agreed that this is absurd. We were told that the matter would be resolved through the Joint Committee, but that did not happen. We read with interest the latest proposal from the European Commission to resolve the impasse, but there was nothing there. Over the past few weeks and months, representatives from the Northern Ireland Fishermen’s Federation have met officials in London and the Minister, and I am really looking forward to her giving us an update in her response. I know that she has already had discussions with Minister Edwin Poots at the Department of Agriculture, Environment and Rural Affairs, so I would be keen to get some idea of what is happening there as well. We have engaged with the fisheries Minister in Dublin on issues such as the designation of landing ports there, a subject in which the UK Minister understandably took a very keen interest recently. The sense they have is that commitments were made but that those were empty promises that have not materialised. To make another pun, actions speak louder than words, and we do not need words today, but actions.
Northern Ireland’s fishing industry is a problem child for some. The analogy is that Northern Ireland’s parents, London and Dublin, have gone through a divorce and the details are still being worked through. Unfortunately, it seems that neither of the parents actually wants us—I am sure the Minister will confirm that she wants us, and we will be greatly encouraged by that when we find it to be the case. In the meantime, the fishing fleet is in survival mode.
The covid pandemic has complicated the scene further, and markets have yet to recover to pre-pandemic levels against a background of increasing overhead costs. Northern Ireland’s fishermen have faced challenges before—worse challenges, some would suggest—and having represented the village of Portavogie at three levels for some 36 years, as a councillor, in the Northern Ireland Assembly and as its MP, I have a deep interest in fishing in Portavogie. My brother used to fish in those boats; I know many people who also fish in Portavogie, and we have regular contact with them. They are resilient, but for many, that resilience is running thin. There are potential solutions to the protocol-related issues, but they require meaningful engagement. I am seeking that meaningful engagement: I am seeking solutions, as the hon. Member for Totnes (Anthony Mangnall) referred to in his intervention, not what the fishermen regard as a lack of interest from London and the begrudging approach by Dublin.
Seamless trade? Ask the processors who face expenses and disruption on a daily basis as they struggle with added bureaucracy when they move seafood from GB into Northern Ireland for processing, as the right hon. Member for Scarborough and Whitby referred to, before it is all shipped back to GB. We were immersed in red tape and bureaucracy when we were in the EU; now we are out of the EU, we are still immersed in it, so there has to be a change in how we do this.
The Government are committed to the levelling-up process. I have welcomed that, and will continue to welcome it in all places, but ask a Northern Ireland fisherman who has seen their share of the new Brexit quota diluted, and quota currencies such as North sea sandeels wiped out because of decisions taken by Ministers here at Westminster, about levelling up. My constituents have been left worse off than their GB colleagues. Despite the recommendation of the Migration Advisory Committee that fishermen be added to the list of skilled occupations, allowing managed recruitment from overseas, the Government have not yet fully addressed that recommendation. However, we did get some concessions on it, which I welcome.
I congratulate the hon. Member for Strangford (Jim Shannon) on securing this debate. On the question of crew from outwith the European economic area, does he agree that the problem is that the level of language competence demanded in order to meet the skilled migrant profile will not actually be applicable to many of those seeking to come and work on these boats, and that for as long as that remains the case, the problem will be unresolved.
I thank the right hon. Gentleman for a very useful, honest and helpful intervention. Many of us think that the standards set are too high to be achieved. That is an issue that comes up whenever I do my constituency surgeries in Portavogie.
The Government have told us that we should wait until we see the impact on the labour market from the covid pandemic. Last week the Prime Minister confirmed that more people are in employment in the UK than ever before. The right hon. Gentleman is right to suggest that we need standards that are achievable, so that we can let people in and fill the vacant spaces in the fishing sector.
Labour shortages have put the processing side of the industry under increased pressure, too. A Scottish seafood processing business that supplies fish for the Queen said last month that it is having to turn away business as a result and desperately needs Government support. Does the hon. Member agree that this part of the industry must not be overlooked or forgotten when it comes to Government support packages?
The hon. Lady is absolutely right. In my constituency, it is not just about catching fish offshore; it is also about the processing that we have on land. Everyone who speaks will refer to that. The right hon. Member for Scarborough and Whitby referred to it in his intervention, and it is really important that we focus on the sector as a whole.
As I draw my speech to a close, I do not want to set the scene of Northern Ireland’s fishing sector as one of gloom and doom. However, those involved in the sector find it ironic that at this time of the year, the focus of intervention has not been on the annual round of total allowable catch negotiations, which are ongoing between the UK, EU and other coastal states. Fishing opportunities for nephrops, cod, haddock and herring in the Irish sea remain critical, and a solution to the abundance of spurdog is a priority for the management of the Irish sea’s ecosystem. As always, our fishermen face serious challenges every day.
Being a fisherman is probably the most dangerous job that anyone can do in the United Kingdom. There is a high level of fatalities, and fishermen go out in all weather. When I go to the harbour and visit fishermen, I can never really get my head around how people can sleep in the foetal position in about 3 feet of space while their boat is being tossed about in the water. That is the job that fishermen do. They acknowledge that there are more challenges on the horizon, driven by climate change targets and the increasingly shared nature of the marine environment. The marine protected areas, the promotion of offshore wind energy, and blue carbon are among the new issues on which our industry, through the Northern Ireland Fishermen’s Federation and the good offices of Alan McCulla and Harry Wick, is seeking to be proactive.
There is a future for the sector in Northern Ireland. Let us be positive, and let us have the glass half full as we look forward. It can be done; we just need the will to do it. This is clearly spelled out in the DAERA report on the fisheries and seafood development programme, published earlier this year by my colleague Edwin Poots, the Northern Ireland Minister with responsibility for fisheries.
The UK has become an independent coastal state. Let us be proud of our fishing industry, rather than create a sense that it is expendable. It is not expendable, and it must never be expendable. It creates jobs and is a massive earner for my constituency of Strangford, as the Minister knows. It is an incredible earner for Ardglass, Kilkeel and Northern Ireland as a whole. As I said earlier, our products go all over the UK, the EU and the world, so we are keen and anxious to find out where we are in relation to the fishing sector in the United Kingdom of Great Britain and Northern Ireland—particularly in Northern Ireland, from my perspective.
Actions speak louder than words. With that being the case, I look forward to the Minister’s response. I hope her words turn into actions, and then we will all benefit.
It is a pleasure to serve with you in the Chair, Ms McVey. I congratulate the hon. Member for Strangford (Jim Shannon) on securing the debate.
It is fair to say, almost a year on from the signing of the trade and co-operation agreement with the EU, that its provisions were disappointing; that there have been subsequent developments that have been disturbing from the perspective of the domestic industry; and that we are yet to grasp the opportunity that managing our own fisheries provides to revitalise coastal communities all around the UK. That said, I retain both confidence and hope that UK fishing can have a bright future. Off the East Anglian coast, the Renaissance of East Anglian Fisheries initiative is moving forward. Its recommendations have been revised in the light of the trade and co-operation agreement and, with support from the Blue Marine Foundation, its strategy is now being implemented.
I shall briefly highlight some of the challenges that the Government must address, by looking at individual fish species. Lowestoft, as a fishing port historically, was built on herring. The good news is that herring are back in the southern North sea and are being landed in Lowestoft by vessels that are fishing in a sustainable and responsible way. However, two issues need to be addressed if we are to make the most of this opportunity.
First, the stocks must be nurtured and properly managed. That cannot be done if high-powered fly-shooter fishing boats, particularly from the Dutch fleet, are allowed to fish our waters without any restriction. It seems perverse that while that is happening, the Marine Management Organisation is spending its time crawling over vessels in Lowestoft, making sure that they comply by dotting every i and crossing every t of their regulations. Secondly, we need to rebuild the local processing sector, so that the full value of the catch can be retained in the local economy. At present, the herring are landed in Lowestoft and driven overland to Cornwall for processing. That is ridiculous, and funding, whether through the £100 million seafood fund, the shared prosperity fund or some other source, must be provided to help leverage investment into local processing facilities.
While increased herring catch is a fact, the opportunity to catch more sole and plaice is a fiction. The trade and co-operation agreement provided for the UK to receive a substantial uplift in sole and plaice quota, when the stocks did not exist. That was both a misrepresentation and highly irresponsible from the viewpoint of sustainably managing our fisheries. Can the Minister confirm that appropriate precautionary management measures have been put in place to ensure that, in future, the science and the reality are properly synchronised and are not so clearly out of step?
Finally, it was concerning that this year, the total allowable catches for non-quota species in UK waters were not enforced. That has proved disastrous, both from the perspective of sustainable fisheries management and for the UK inshore fleet. Large and well-resourced EU vessels licensed to fish in UK waters were, in effect, allowed a free rein to fish for valuable non-quota species. Can the Minister confirm that that mistake will not be repeated in the coming year, and that protective measures will be put in place to ensure that small boats are not crowded out by larger and better-resourced vessels?
In conclusion, the UK has not made an auspicious start to its return to being an independent coastal state. That said, in REAF and from all around the UK, there are people and businesses with great ideas and a desire to get on with the task of rebuilding our fishing industry. What they need from Government as quickly as possible—and I sense that time really is of the essence—is a coherent, sustainable strategy for the management of English fisheries that will be properly enforced. They need the opportunity to quickly roll out local fisheries management plans and they need provision of seedcorn funding for the rebuilding of our local infrastructure and facilities.
I congratulate the hon. Member for Strangford (Jim Shannon) on securing this debate. There should be an annual fisheries debate in the parliamentary calendar, ahead of the December Fisheries Council, so that we can give as much power to the Minister’s elbow as possible to ensure that the deal that she goes to negotiate, albeit from outside the room, is as good for our fisheries as it can be.
Fishing matters. It matters in Plymouth, where there are nearly 1,000 jobs that rely on not only the catching but the processing sectors and the associated trades—supply chains and exporters. Fishing matters because it is part of our identity. Plymouth is no different from other coastal communities that I see represented around the room, in that we want to see our fishers get a better deal than they have so far.
I agree with the hon. Member for Waveney (Peter Aldous) that we have started our time as an independent coastal state quite poorly. That is because of a botched Brexit deal, because of overpromising to our fishers and because, frankly, when it came to the crunch, fishers were regarded as disposable by the negotiators. They must not ever be regarded as disposable. This industry matters.
Fishing does take too many people; it is a dangerous profession. We need to remember people at home and abroad who lose their lives to accidents at sea or are injured. Progress is being made on safety. I would like to praise Clive Palfrey, RNLI coxswain and former fisherman, for his work taking the search out of search and rescue by starting to put locator beacons on lifejackets as part of the Plymouth lifejacket scheme, which the Minister supported with a grant. It has been a huge success, and we should continue to encourage its continued nationwide roll-out because it will save lives.
I pay tribute to the RNLI. It provides support for our fishers 24/7, all year round. In particular, I thank the people who have dedicated their entire lives to it. Milf—or Dave Milford, as he is better known—has given 32 years’ service to the RNLI at Plymouth. The fishing industry’s gratitude to him is echoed by me and many others whose lives he has saved. He also has an amazing nickname, which helps. Coastguards and the National Coastwatch Institution, which my stepmother is a member of, also do a super job all year round.
In the pandemic we saw the fishing industry hardest-hit, not only by a botched Brexit deal, but by the closure of the export and domestic markets. I want to give a shout-out to Call4Fish, a super Plymouth initiative that started out on a shoestring budget and is now supporting fishers nationwide to sell their catch directly from the back of their boats. That was thanks to the Seafarers’ Charity and fishmonger hall charities, who helped by putting their confidence in that. It shows that we continue to be pioneers in Plymouth. I would have liked a wee bit more support from DEFRA on that initiative, but there is still time.
I am afraid that, when it comes to fishing policy, all is not well. Fishers do feel betrayed, especially over the six to 12 mile promise that was broken. They feel betrayed that much of the money that has been promised to them in redeveloped opportunities has not come through. I know that the Minister will look kindly on an application made by Plymouth to help us redevelop our own fish market and bring our facilities into the 21st century. That will not only provide better, more cost-effective locations for landing, processing and selling fish, but will make sure that we have a sustainable future for the industry in Plymouth; we are also supporting the industry right around the south-west coast.
The National Federation of Fishermen’s Organisations report by former senior DEFRA negotiator Gary Taylor set out the numbers that many of us suspected. There were losses by our fishing industry of £64 million a year. That is not just eating away at margins, but breaking businesses. We need to recognise that exporters have been hit in particular because of the additional red tape and costs, and other problems. Many small exporters have simply stopped exporting—stopped selling into our EU markets.
Problems remain, especially with live bivalve molluscs around the south-west: although some waters have been reclassified as grade A—the hon. Member for Totnes (Anthony Mangnall), from further up the Devon coast, is very cheerful about that—not all those waters have. Businesses that still fish in grade B waters are unable to export their live bivalve molluscs to markets in the European Union, and I worry whether, after another season of that, there will be any business available for them. That needs to be addressed.
The French disputes over the past few months have been difficult for our fishers. They have added extra caution for people going to sea and extra worry about fishing in French waters in particular. I would like the Minister, when she gets to her feet, to explain what lessons have been learned, especially from the details of the fishing boat that was detained having been left off the database provided to the French by the UK authorities. A little bit of honesty would go a long way in supporting that.
Fishing in the Channel Islands is an important part of the sector; they are part of our big family that has been hit by a botched Brexit deal. I hope that the Minister responds to that point.
Turning to the December fisheries council, what are the Minister’s expectations around shared stocks and what is the science that we are asking for in relation to that? Much of the extra promised fish that the Government made a lot of in their announcement is paper fish: it only swims on spreadsheets. It does not exist in the sea; it was a fabrication and a fiction, and fishers know it. How can we ensure that any deal that may come out of the December fisheries council that affects our shared stocks will be based on science and will be catchable? What are we doing in relation to non-quota species? There is a real concern about how some of that sits.
I would like the Minister to recognise that the absence of a deal with Norway on fishing in distant waters is causing real pressure—not for fishers in Plymouth, but certainly for the fishers that I met when I went to Hull to see the distant water fleet there. There is a real concern that the lack of a deal with Norway will collapse that part of the sector, which is a proud part of not only Hull’s fishing past, but its present and future.
Finally, I would like to know the Government’s plan for net zero for fishing. Each and every time our fishing boats go to sea they consume an enormous amount of diesel, pumping a large amount of carbon into the atmosphere. I would like the Government to have a strategy with a date by which fishing will become net zero—not just because they are buying offsets for the larger companies, but because they are decarbonising their propulsion and fishing in more sustainable ways. I have posed quite some challenges there, but I have enjoyed my chance to serve on the Front Bench, and I warn the Minister that I will continue to ask difficult questions from the Back Benches about fishers, especially for those from Plymouth.
If it is not too embarrassing to the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard), may I say how sorry we are to see him return to the Back Benches? He has been a fastidious voice on fishing and a champion of coastal communities, across the whole of the country but also in Devon. I for one will welcome the fact that he will be on the Back Benches and able to work with me on supporting coastal communities, not least in the south-west, and on what more we can do for the fishing community. I totally agree that we should have an annual debate on fisheries; I am sure that in an example of cross-party unity we can find a way to make that happen.
I want to add to the hon. Gentleman’s words that we should also thank the independent lifeboats that are not part of the RNLI. I am in the process of setting up an independent lifeboat association, which he may like to lend his support to. I am also working on an aquaculture all-party parliamentary group to specifically address the points around live bivalve molluscs. It is too broad just to have an APPG on fisheries when there are clearly opportunities for what we can do within the LBM sector and indeed the shellfish sector.
It is a pleasure to speak in this debate, and I congratulate the hon. Member for Strangford (Jim Shannon) on securing it. As ever, he gives a unique perspective on the difficulties faced by Northern Ireland, but he also emphasised that fishing across the United Kingdom has a particular opportunity to improve, to enlarge, to expand, to grow and to become an industry that is worth a great deal more than it is now, and that the opportunity lies with DEFRA. Of course, within my own constituency I have Brixham, Salcombe and Dartmouth, and I am very proud of them as fishing communities. I was very proud, a few weeks ago, to spend 24 hours at sea on a Brixham trawler, doing two hours on, two hours off—I can tell you, Ms McVey, they made me work for it. It was an extraordinary insight into the skill required to be a fisher in the UK, the risks that are taken and the hard work that goes into it.
I do not believe that the Brexit deal is botched; I believe it has provided a great deal of opportunity. When I have talked to my fishermen, I have met only one in Brixham who regrets our leaving the European Union and, in fairness, he has been quite quiet of late. It is important to remember that there are some positives to be mentioned here: 25% of existing EU quota will be transferred to the UK over the next five and half years, with an estimated uplift of £27 million, making the total £333 million. There is also the specific percentage agreed for existing fish stocks.
I want to come on to what happens after the transition period, because DEFRA can add a great deal more clarity on where we go beyond 30 June 2026. After the transition period, we will be able to negotiate total allowable catch on each of the 87 stocks that are mentioned in fish annex I and II. As I mentioned in my intervention on the hon. Member for Strangford, the creation of a Specialised Committee on Fisheries is particularly welcome, as is the fact that it will be meeting three to five times a year. I will come to that in a second.
There is undoubtedly an uplift and a broadbrush approach in applying this to the whole of the United Kingdom, which comes with its own problems. However, today’s debate offers DEFRA and the Minister the chance to reassure the fishing community that we are going to address the areas about which it feels most aggrieved. The first, as has been mentioned, is the six to 12-mile limit. That is perhaps the most egregious of the compromises made around fishing, which is particularly well felt. Two weeks ago, in Salcombe we were all tracking a French vessel that we believe—I am cautious in saying—came within our six-mile limit, and indeed did a great deal of destruction to a whole load of Salcombe crab pots. The response was to go through the MMO to report it, but nothing has been heard from the MMO by my Salcombe fishermen. There is clearly something at odds there.
On the six to 12-mile limit, we have the opportunity after the transition period to be very clear about what we want for that area. I ask DEFRA now to start talking about its intentions. I used to be a negotiator in shipping, and I understand that no one wants to reveal their hand, but it is important to give the clarity that we are going to go forward and ensure that that six to 12-mile limit becomes UK-only. That is what was expected before the deal; in fact it was a great surprise to many that it did not happen. Many fishermen in Dartmouth, Salcombe and Brixham made the point that their counterparts in France could not believe that we had given away that part of the deal.
As was said by my hon. Friend the Member for Waveney (Peter Aldous), supertrawlers, fly-shooters, are seen off the coast of the United Kingdom. We said that we wanted to deal with supertrawlers; we have to ensure that we are doing so. There is no greater image of our having let down elements of the fishing community than seeing those vessels. Let us be clear about what we want post June 2026.
The second point is around the money. It is welcome that £100 million has been put forward; it has shown commitment. I know the Minister feels passionately about what the levelling-up fund can do, as well as helping coastal communities. So, it is not just £100 million; it is plus the £4.8 billion in the levelling-up fund. It is great that pillar 1 has been announced, but I am tired of having to ask repeatedly when pillar 2 and 3 will come. I recognise that the Treasury controls the matter; I am not blaming the Treasury or the Minister. I am saying that a great deal of hope is pinned on that money, and the infrastructure and development that could be had to help expand the fleets in the UK, by building more boats, retrofitting and repairing them and training people to come into the industry. Those are important areas in which we can help grow the fleet and the industry. I ask again: when are we going to have pillars 2 and 3, and how quickly might we be able to apply for them and expand?
The third point is around the Specialised Committee on Fisheries. It is particularly welcome that the trade and co-operation agreement has outlined the different committees, including the one related to live bivalve molluscs on sanitary and phytosanitary measures. Those committees are still mired in a little bit of secrecy and opaqueness. The last meeting of the SCF was on 27 February. The only information that I can find— I am happy to be proved wrong—is the agenda. Our fishing communities across the whole of the United Kingdom need to understand what is discussed in those meetings and how they can have an input. We must ensure that we not only feed into the agenda, but get the response so that we understand that we are discussing the problems and trying to find the solutions, as the hon. Member for Strangford rightly said. It is also said that the group will meet between three and five times a year. I hope that the Minister will be a little more specific as to when. It is important that we have stuck-in-stone dates to ensure that we meet in the right places.
I have taken up far too much time. I just want to say that there is an opportunity. We know that places such as Brixham can make a great deal of money. In fact, it is having one of the most successful years on record. That is clearly not the case across the whole of the United Kingdom, but there are steps that DEFRA can take to reassure the industry, help expand it and help it grow. Given those who are in this room, there is a great deal of opportunity and willingness to work together across party.
It is a pleasure to serve under your stewardship, Ms McVey. May I congratulate the hon. Member for Strangford (Jim Shannon) on securing the debate and associate myself with the remarks from the hon. Member for Totnes (Anthony Mangnall) about the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard)? I have seen quite a few Labour Ministers and Front-Bench spokespeople on fisheries in the last 20 years. Without reopening old wounds, they ran the full range of competence and commitment, but the hon. Member for Plymouth, Sutton and Devonport was very much at the top end of that range, and we will miss his contributions from the Front Bench. However, I welcome the hon. Member for Cambridge (Daniel Zeichner) to his place. He has big shoes to fill and I am sure we all wish him well.
It is worth reflecting for a second or two on how different this debate is today from the ones that we had, it seemed, almost every two or three weeks this time last year in the run-up to the negotiations. At that point, the people who are in the Chamber taking part today, who by and large represent coastal and fishing communities, were squeezed down to two or three minutes at most as there was a progression of people standing up to hail a new dawn. Ultimately, it turned out they did not know the difference between a codpiece and a cod end, and they are more remarkable for their absence today. Even those from fishing communities who were most extravagant in their promises are remarkable for their absence today. Although I am not going to name anyone, I would not want anybody to think that it had gone unnoticed.
As others have said, the TCA did not deliver what was promised. The real difficulty for the Minister and her colleagues now is that the terms of that TCA are such that, despite the protestations of the Prime Minister, come 2026 it is very difficult to see how that will change. First, the consequences for other sectors of any change in relation to the fisheries provisions would be so severe that it is difficult to see any Government in five years’ time making that sacrifice if they were not prepared to make it this time last year.
Secondly, the terms of the TCA will be changed only if there is a Government strategy, and I am afraid the one common thread that we have heard from every contribution here today is the total absence of any Government strategy on what they will do with fisheries policy now that we are no longer part of the European Union and the common fisheries policy. I would be delighted to be wrong about that. When the Minister answers, we will be listening carefully. At the moment, I see absolutely no sign of it.
The hon. Member for Totnes spoke about the SFC—the fisheries committee. That illustrates quite well some of the challenges that we now have because that is where the decisions will be made about in-year quota swaps. Those are absolutely critical to producer organisations up and down the country, but the SFC is at best going to meet four times a year. We have to have a mechanism. POs cannot just expect to do their in-year quota swaps four times a year. That business was being done on a weekly and sometimes daily basis under the old arrangements.
The Minister will recall the discussions that we had at the start of the year and the utter chaos that there was. What was described then as teething problems seems to continue today. If my children had taken that long to teethe, I might well have put them up for adoption. [Laughter.] The teething problems have an exceptionally long tail. I have been in correspondence with the Minister over one exporter from Shetland who had £50,000-worth of fish that was due to be exported in that first week; he was not able export a penny piece of it. As a consequence, he sold it on the domestic market for £20,000—a loss to his business of £30,000. Had he left the fish to sit and rot, he would have got £50,000 in compensation from the scheme set up by the Minister, but because he mitigated his loss—in the best interests of his business and the taxpayer—he was told, “No. You have sold your fish, so you will not get a penny piece of compensation.” As a result, he is £30,000 out of pocket. In what universe does that make any sort of sense? It all contributes to the feeling among the catchers and processors and exporters that they are just a wee bit embarrassing and a wee bit too much trouble for this Government to care about. When the Minister replies, will she explain how that compensation scheme has been left to work the way it is?
I will close on the question of the availability of crew, which is something that everyone in this room has campaigned for. It was a major advance when we got the Migration Advisory Committee to accept that deckhands are, in fact, skilled labour. However, the fact is that we are no closer to a workable solution. The insistence that deckhands should have a B2 level of language competence means that the skilled labour concession is virtually meaningless to the industry. The Minister should speak about that to her colleagues in the Home Office—I very much hope that she will.
While there is an awful lot more that I could say about the availability of labour in the processing sector, I see that time is against me. I conclude my remarks, hoping that we may have a more substantial fisheries debate in the main Chamber again in years to come.
Unfortunately, I had to miss a meeting that I had arranged with the Minister and Alan McCulla of the Northern Ireland Fishermen’s Federation a few short weeks ago, but the meeting nevertheless went ahead. I am grateful for a listening ear from the Minister, and that she is, as my hon. Friend the Member for Strangford (Jim Shannon) said, someone who gets it. I understand that the meeting provided a useful opportunity for the Minister to hear first hand from Mr McCulla about some of the practical—verging on dangerous—issues fishers in Northern Ireland are already coping with as a result of the protocol, as well as their fears if the protocol was implemented in full.
Let us be clear. The protocol has already hit hard many parts of society in Northern Ireland, but our fishing industry risks being hit even harder. Restrictions to the east-west seafood trade and issues around the non-designation of landing ports in Ireland would pale into insignificance if the protocol were implemented in its entirety; my hon. Friend very articulately outlined some of the ludicrous scenarios that would exist if that happened.
Some claim that the protocol has its advantages. “Look,” they say, “at the seamless trade in seafood between Northern Ireland and the EU.” If only it was the best of both worlds, as some have proclaimed. The protocol was signed up to by this Government but it is heavily weighted in favour of the Irish Republic, which seeks to punish Northern Ireland fishers, among others, because Brexit finally ended the discrimination suffered by our fishermen under the EU’s common fisheries policy. That discrimination effectively stole fishing opportunities from UK fishermen in the Irish sea and gave them to fishermen from the Republic of Ireland. There was not much love shown by Dublin towards Northern Ireland on that matter for 30 years.
Imagine the strength and unity of the mighty European Union being threatened by part of an island off an island on the western periphery of Europe that is home to a fishing fleet which equates to 0.4% of the EU’s fleet. Of course, we wish for a good relationship with our nearest neighbour. Our fishermen wish to fish in the same waters. They wish to sustainably manage shared stocks in the Irish sea in an area that is 70% sovereign UK territory. They continue to welcome fishermen from across these islands to the harbours in Northern Ireland, but they should not be subservient to the EU.
The Minister is well aware of the challenges facing the industry—some historical, some new. The annual total allowable catch negotiations are ongoing. DEFRA engagement with industry stakeholders on this and a range of other issues has been somewhat impaired. Technical conservation measures in the UK’s Celtic prawn fishery that is dominated by Northern Ireland fishers, access to pilot fisheries for spurdogs, decisions around the management of sandeels, future management of non-quota stocks—the list goes on of policies where our fisherman have felt somewhat excluded, not by the Minister personally but by the Department.
Challenges can become opportunities and the Minister has heard about progress with plans to develop the fishing harbours in Northern Ireland. Indeed, I hope she can attend an event that I am organising here in Westminster next Wednesday to hear more on the issue. As an island nation and independent coastal state, there is a renewed focus on the marine environment and the real estate there. Competition for space threatens the sustainable exploitation of our sea for valuable seafood. The fishing industry is not expendable for other interests, which is regretfully how the industry feels. Rather, Government should work with fishers from Northern Ireland and elsewhere around the United Kingdom to look for ways of harnessing the unique and specialised skills of fishermen.
Finally, I make no apologies in saying that I want the best for our fishermen and for everyone involved in the fishing industry in Northern Ireland. The protocol, the TCA and the way London has treated Northern Ireland’s fishermen in apportioning new quotas, as well as the way Dublin continues to punish Northern Ireland’s fishermen, falls far short. Actions do speak louder than words, and we ask for actions.
It is a pleasure to serve under your chairship, Ms McVey. I very much commend the hon. Member for Strangford (Jim Shannon) for bringing the debate to this place. As always, we hear valuable information when listening to Members’ contributions on the lived experiences of their constituents, and I thank them for that. The hon. Member for Strangford catalogued a number of the failures so far to resolve some of the problems his fishers are facing since Brexit, describing many members of the industry as being in survival mode and as seeking meaningful solutions, including to the red tape that was supposed to be swept away by Brexit, but which snarls businesses and costs them dearly.
The hon. Member for Waveney (Peter Aldous) spoke of his disappointment and some of the challenges regarding individual fish species. He called for investment in local processing plants, and asked for science and reality to be rather more closely synchronised, and that is a fair point. I join other Members in lauding the efforts of the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard). He has been an excellent colleague. I appreciate all he has done on the Front Bench, and I wish him very well as he returns to the Back Benches. He spoke of the betrayal felt by fishers across the industry as a result of the Government’s actions. He spoke of paper fish, which was an interesting way to put it, and asked what is actually catchable. We are all looking forward to the Minister’s response on that. He also outlined the importance of DEFRA’s response to the net zero challenges of the fishing industry.
The hon. Member for Totnes (Anthony Mangnall) offered the Minister the opportunity to reassure fishers about the big problems they are facing, so we are all very much looking forward to that. The right hon. Member for Orkney and Shetland (Mr Carmichael) suggested that some MPs could not tell a cod head from a codpiece.
Sorry. That raised a chuckle across the House but, more seriously, he made the point about the difficulty of seeing how the problems of the TCA can actually be resolved, and reminded us that what was once described as teething problems seems actually baked in and are clearly having a dramatic impact on so many in the fishing industry.
It seems right, when we speak in a debate on fishing, and particularly after the stormy seas of the past few days, to remind ourselves of just how dangerous an occupation fishing is—it is the UK’s most dangerous peacetime occupation—and of what our fishers risk to bring us this incredible food. I must commemorate and salute those who have paid the ultimate price, current fishermen and their families, and the fishing communities whose remarkable strength and resilience, despite at times almost overwhelming challenges, can be seen each and every day.
We must also salute and offer our deepest thanks to the many organisations that offer aid and support to those communities. Not all heroes wear capes—some wear bright yellow wellies. I thank the volunteer crews of the RNLI for their truly heroic efforts. Every day around our coasts, they go without hesitation where others fear to, and I offer our deepest thanks to them for helping to bring home fishermen safely to their families. I also thank the Fishermen’s Mission for its work. It is there for seafarers whenever things go wrong, and its support and pastoral care is just remarkable; the comfort that it provides is priceless. I must also mention the wonderful Seafarers’ Charity, formerly Seafarers UK, in particular for its swift response at the start of the pandemic. Within days, it had set up desperately needed grant systems to help fishermen and merchants, quickly getting money out of the door and into fishing businesses that might not be here today had it not been for that rapid response. The pandemic hit all of those charities’ fundraising efforts hard; I urge anyone watching to please, if they can, choose one or more and give, so that their incredible work can continue. The need for their support continues to grow.
We all look forward to a time when we can come to a fisheries debate in this House and not have to honour any loss of life in the previous year. That will not happen by itself or by accident. It will be as a result of innovative fishermen such as John Clark, from Banff, who worked tirelessly on the design of his new vessel, Reliance III, with the shipyard at Parkol, to place crew safety at the heart of the deck design. A continuous safety rail around the boat ensures that crew can have their safety harnesses attached as they work on deck, stopping them washing overboard in poor weather. In the new design of the main winch, bespoke safety guards protect against snagging risk. Clark and Parkol Marine Engineering are really at the vanguard of the latest developments—and hats off to them. I hope that they and others, using their deep knowledge and understanding of the challenges that the sea presents, continue to show us the way to improve safety, and I hope that others follow their lead.
Obviously, negotiations on catch allocations are ongoing, and the Scottish Government are working for successful negotiations that deliver a sustainable stock management process and a solid financial future for the sector. Discussions with Norway, the Faroes and the EU across all negotiation forums have, I believe, been constructive, with all sides very keen to decide bilateral and trilateral agreements where there are shared fishing interests. Those agreements with Scotland’s closest fishing partners are key to successful and sustainable stock management. Of course, no agreements have yet been concluded, and talks are planned to continue over the coming weeks. However, with the negotiations taking place against the background of COP26, I know that we are all very much aware just how important it is to secure a deal that actually strengthens the financial future of the sector and the sustainability of fishing stocks—not just for short-term prospects, but for our children and our grandchildren to enjoy healthy, safe, productive and biologically diverse oceans both today and tomorrow.
Although fishing is a devolved matter, whatever the outcome of those negotiations we are unfortunately still left with the Tories’ Brexit deal with the EU, which leaves Scotland and the UK with less trading power than we had as part of the EU and has resulted in generally lower catch stocks for Scotland’s fishermen. Once again, we find our Scottish fishing fleets and businesses impacted by this Westminster Government’s mishandling of the TCA and their seemingly endless appetite to pick fights with the French. Our fishing industry has been greatly damaged. It might be the case that the licences the French say are outstanding belong to vessels that do not have the right to fish UK waters under the TCA that this Government signed us all up to, but who knows? There has been so little transparency on that matter, and without those details, it is impossible for the rest of us to judge for ourselves. When the Minister gets to her feet, can I ask that she lets the rest of us in on what is happening, specifically how many French applications have not been met with the issuance of a full or temporary licence and remain outstanding; how many of those relate to access to fishing waters outside of 12 nautical miles; how many relate to access to Jersey waters; how many relate to access to the English six to 12 nautical miles; and whether any other EU states are waiting for licences to be issued?
I was hoping that the hon. Lady would get around to talking about her own party’s policy which, as far as I understand it, is for an independent Scotland to rejoin the European Union and give those new-found freedoms and independent status that it would have as a fishing nation back to those people in Brussels who Scottish fishermen voted to be free from.
It is interesting that someone who is as pro-Brexit as the right hon. Gentleman still continues, in the face of all the criticisms that have been expressed today, to defend the TCA and the negotiations entered into by his Government. As he has heard me say several times before, our intention is to renegotiate when we re-enter Europe as an independent nation.
In respect of the processes that the Government are using to determine whether those French boats are due a licence, what is the benchmark for the evidence they require? Those who use boat diaries, for example, treasure them like gold, so can the Minister say whether those diaries are being accepted? Are any other forms of evidence being accepted? Of course, all of this could have been avoided if the Government had not rushed through the TCA, but had taken just a few minutes to spell out what evidence was going to be acceptable to them. The conflict with the French that this has caused was entirely predictable and preventable, so I would be grateful if the Minister will confirm whether the Government even tried to have that detail added to the TCA that could have averted all this.
Finally, the next few weeks—the run-up to Christmas—are hugely important for sales and exports, so what assurances can the Minister offer Scottish fishermen and merchants that their goods will continue to pass without disruption caused by what is, I have to say, a very English problem? I put the Minister on notice now that if we continue to see an escalation and goods are delayed or stopped, I will be coming back to this place to demand a proper compensation package for Scottish fishermen and merchants. Scottish businesses should not bear any more losses because of this Government’s incompetence or lethargy in their handling of the TCA. I know that I have asked a lot of questions, so if the Minister would like me to assist, I am happy to write to her with all of them so that we can get the answers that many in the fishing industry seek.
As ever, Ms McVey, it is a pleasure to serve with you in the Chair, and I think we are all grateful to the Backbench Business Committee for allowing today’s debate and to the hon. Member for Strangford (Jim Shannon) for introducing it so expertly. I also endorse the comments made by several speakers about the fact that this really ought to be a debate held in Government time in the main Chamber, and should take place on an annual basis.
I thank the many speakers who paid gracious tribute to my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard). Much as I am pleased to be here this morning, I would rather that it were in other circumstances. Those tributes were most gracious, and the fact that he is here this morning speaks volumes about him as a person. [Hon. Members: “Hear, hear.”]
I will start by echoing some of my hon. Friend’s words, and paying thanks and tribute to all the fishers who go out all the time in all weathers. Agriculture is a dangerous occupation, but fishing is clearly even more dangerous, and all those people deserve our thanks. I have often turned on the radio in the morning around this time of year and heard successive Ministers talking about fishing—it is that time of year, isn’t it? Sometimes those Ministers were my friends, when Labour was in government; other times, they were people I knew, dealing with these complicated questions on the radio, often with interviewers who, I sometimes suspected, were struggling even more to understand the complexities involved. People might have imagined that those questions were a thing of the past now that we are an independent nation. However, we all know that in the real world, whether a nation is inside a bigger trading bloc or outside it, the negotiations go on, exactly as the hon. Member for Strangford pointed out. There was red tape, and guess what? There is still red tape. Is that not remarkable?
Perhaps the most obvious observation is that the key thing is for a nation to ask itself how it gets on with its neighbours because, whatever world we live in, that is a key question. It is a question that Labour is now focused on: how to make the new post-Brexit world work for the UK and, in this case, particularly for the fishers and those who process fish. Whenever I come to do a debate, I often turn first to the Library briefing because it is always excellent and full. I often turn to the news items near the end because that gives a flavour of what has been going on. How has it been going? BBC News online asks, “Why is there a row over fishing rights?” The Times reports “French fishermen shut off port” and The Maritime Executive says French fishermen blockade channel ports. The Telegraph says French fishermen threaten to blockade and “Britain and the EU stand on the brink of a trade war”. The Times states “Lord Frost warns EU against ‘massive retaliation’”. I could go on. When we think about it, it has not gone that well over the last year, is it?
If that is what the press thinks, what do the fishers think? I find myself turning to the NFFO report on the “Brexit Balance Sheet”. It is pretty damning. In response to the trade and co-operation agreement deal, the NFFO says:
“The UK fishing industry was shocked at the scale of the UK’s capitulation”.
Those are strong words and ones I have heard around the room this morning. It was
“a decision made at the highest reaches of Government”
that came about
“despite the promises, commitments and assurances made during”
the campaign by some of the Members who clearly are not here this morning.
I am sorry to interrupt the hon. Gentleman. Just as he should not judge a book by its cover, neither should he just look at those headlines and think that it is all doom and gloom. He is welcome to Brixham at any time to see one of the success stories of the fishing industry. Why does he give the NFFO report and its number greater weight than the MMO report that said there was a £143 million uplift from the TCA?
I am always happy to listen to all voices, but these are people who have a strong interest in the industry. The report carries on to say:
“Access to fish in UK waters—a key bargaining lever in annual fisheries negotiations—was ceded to the EU for 6 years (at least)”,
as we have already heard. We even failed to secure an exclusive 12-mile limit, which is something that most coastal states take for granted.
We have heard from other Members why we got to this state, because we all remember what was happening this time last year. I am sure the Minister will remember the desperate telephone call over new year to try and explain what had been going on. We know what had been going on: it was rushed and botched. As my hon. Friend the Member for Plymouth, Sutton and Devonport said, the fishers were betrayed on this issue and became the problem child and so on. I suspect the right hon. Member for Scarborough and Whitby (Mr Goodwill) wants me to give way.
Of course, we are all disappointed at the delay in becoming a truly independent coastal state. Does the hon. Gentleman also recognise that, as a country that exports most of the fish that we catch, we still have access to the European markets, which is as important for many—particularly for shellfish fishermen off the Yorkshire coast—as the fisheries agreement for quota stocks?
I absolutely recognise that point. The point I am making, though, is that things have not gone well over the past year and it is entirely reasonable, a year on, for us to challenge the Minister as she goes into negotiations. To complete the point about the NFFO report, in the introduction by Barrie Deas, where the Government’s figures mention £148 million in additional benefit for the UK fishing fleet by 2026, the NFFO’s figures suggest a £300 million loss. I do not dispute that different people can cut the figures different ways. They are not simple issues. I just report what people are telling us.
In this morning’s debate, we have heard about the complexity of the issues and the range of experiences around the British Isles. It is an extraordinarily complicated industry and, frankly, I do not think the Opposition have to make the points because they have been well made. The hon. Member for Waveney (Peter Aldous) made a powerful contribution, and I am sure the Minister heard loud and clear the problems to which he alluded. Throughout this year, my hon. Friends have raised repeated concerns about the plight of small boats, particularly through the pandemic. My hon. Friend the Member for Plymouth, Sutton and Devonport has been relentless in criticising the hapless catch app, which was quick to be implemented in contrast to the speed at which support for small boats was not supplied. We also heard about the paper fish in the quotas. Sadly, hon. Members have made the point that the quotas are not always as they seem, and the quota swaps issues, complicated as they are, clearly are not working for our people. The shellfish sector was in the headlines at the beginning of this year and the problems continue. If it has had problems, so too has the distant water fleet.
I could not help noticing the Minister’s visit to Norway in the summer to meet the splendidly named Odd Emil Ingebrigtsen, who was Norway’s Minister of Fisheries at the time. I am glad that she went, but what were the consequences of the visit? What progress has been made? That brings me to a series of questions that are not dissimilar from some that have been raised by right hon. and hon. Members, and which I hope that the Minister will be able to answer. Will she spell out what the Government’s objectives are for December’s Agriculture and Fisheries Council? Will she tell us where the Norway deal is for our distant water fleet, particularly those based out of Hull? Will she make a statement to the House on the outcome of any deal and any quotas?
In conclusion, it is absolutely clear that the Government were guilty of overpromising and underdelivering. Thankfully, the Opposition want exactly the opposite, and we want to build on developing a new, constructive relationship with our neighbours—not to get headlines, but to get the outcome that our fishers need.
I join others in thanking the hon. Member for Strangford (Jim Shannon) for securing the debate and for making a rather lyrical speech on the current situation in Northern Ireland. I think it is fair to say that the Northern Irish industry is extremely well represented at all levels. Alan McCulla and Harry Wick are in frequent contact with us, I spoke to Edwin Poots last night, and I enjoy working closely with the hon. Members for Strangford, for Upper Bann (Carla Lockhart) and for East Londonderry (Mr Campbell) on all these issues, which are important to the industry.
I also join others in paying tribute to the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard). I agree that it is very decent of him to turn up this morning, and I know that nothing would keep him away from a fisheries debate. We in DEFRA—I speak for the whole team—have enjoyed his time on the Front Bench and enjoyed working with him constructively. I know that fishing matters to him and that his work on safety issues will be viewed as some of his most important work on the Front Bench. I noted what he said about Clive Palfrey and Dave Milford, or Milf, whose nickname I look forward to learning about—I fear that I know it. I also note what right hon. and hon. Members of different parties said about the RNLI and other heroes in yellow wellies, which I thought was a very good way to describe them. They do so much to help with the safety of our fishermen, and in very dangerous conditions that exist right now.
I also pay tribute to my hon. Friend the Member for Totnes (Anthony Mangnall), who is a great champion of his fishing industry and who is doing exciting new work on aquaculture, which I look forward to being part of. I am glad to hear of the success of Brixham this year. I have visited it, and it is truly impressive. The domestic sales from Brixham market are an achievement that people should be very proud of.
The right hon. Member for Orkney and Shetland (Mr Carmichael) is a regular correspondent and interlocutor on fisheries matters too. I ask him to hold on for the joint fisheries statement, which is coming very early in the new year. I am working on a draft at the moment, and in that will be the plan and a list of potential fisheries management plans. I am also looking at my hon. Friend the Member for Waveney (Peter Aldous), who represents the REAF initiative, which is very much the forerunner of some of this work. I look forward to working with both the right hon. Gentleman and my hon. Friend on these issues very early in the new year.
I will make progress, if I may, because I have an awful lot of questions to answer and I want to leave time for the hon. Member for Strangford to sum up.
As all the experts in the House know, the annual fishing opportunities negotiations are under way, and I hope that they will come to a happy conclusion in the next few weeks. Our aim, which the hon. Member for Cambridge (Daniel Zeichner) asked about, is to secure a package of fishing opportunities and access arrangements for 2022 for fisheries that are consistent with our fisheries objectives, as set out in the Fisheries Act 2020, and that are informed by the best available scientific evidence. We are currently working very hard to deliver this through negotiations with the EU, with Norway and with the Faroese. We are determined to be a pragmatic negotiating partner.
We are pleased that the high-level negotiations with the coastal states have recently concluded and there has been successful agreement on the setting of global total allowable catches for 2022 mackerel, blue whiting and Atlanto-Scandian herring, in line with the advice provided by the International Council for the Exploration of the Sea.
UK-EU bilateral negotiations began on 11 November. So far, they have covered a range of topics including TAC allocations and special conditions, sea bass and non-quota stocks. Really good progress is being made. We intend to conclude these negotiations by the end of next week, in time for the EU to go through its internal processes, as was envisaged in the TCA.
We are also currently in the midst of trilateral negotiations with the EU and Norway, and bilateral negotiations with Norway and the Faroe Islands. They have been positive and constructive so far, and last Friday I had a useful meeting with new Norwegian Minister of Fisheries, as Odd Emil Ingebrigtsen is no longer in post. We are cautiously optimistic that we will reach agreements that will support the long-term sustainability of North sea stocks, as well as maximising opportunities for UK industry. Arctic stocks are one of a number stocks we are considering in our bilateral negotiations with Norway. I know how important they are.
On the apportionment of the additional quota we received in the TCA between the UK Administrations, there is no consensus in industry or between the fisheries administrations about how to use this additional quota. There is always a high demand for more quota but sharing out quota is a zero-sum game. More for one Administration of course means less for another.
This year, following extensive consultation, we went for a blend of 90% track record and 10% zonal attachment. Our approach was welcomed by many but some, including some members of the industry in Northern Ireland, felt we should have taken a different approach. We have been reviewing how this new method for allocation between the fisheries administrations worked this year and will be launching a public consultation soon to help us develop methods for the future. I look forward to hearing from all right hon. and hon. Members here about how that should be done. We have been working closely with all the devolved Administrations on this; it is not easy.
The first part of the £100 million seafood fund, mentioned by many and announced on 11 September, is to provide a £24 million science and innovation pillar. This will support the industry to work jointly with scientists to gather new data to help us manage our fish stocks more sustainably. It will also help us gather new data on gear selectivity and improve understanding of the ecosystem benefits and impacts of aquaculture. I heard what my hon. Friend the Member for Totnes said about net zero, and it will also help with our path towards that. It will help fund projects which develop innovative ideas and technologies, such as new biodegradable packaging for seafood in order to reduce single-use plastics.
I am pleased to tell my hon. Friend and others that further details on the future pillars are expected next week. I expect to hear from many of the Members currently here about their views and ideas for spending that money. The infrastructure pillar will invest in ports, processing and aquaculture facilities for the fishing industry.
I am absolutely not going to agree on my feet at this point who should be getting that money, but I fully expect all hon. Members in this Chamber to be putting in their bids with enthusiasm. It is a generous scheme, and I am hopeful that those who put in decent bids will be suitably rewarded.
The third pillar—skills and training—will be aimed at attracting new entrants into the fishing industry and encouraging employment opportunities. That will help in the longer term with the labour shortages that several hon. Members mentioned. I am pleased to hear that the MAC report helped with including deckhands—although I heard what the right hon. Member for Orkney and Shetland said—who were added following the last recommendations. The MAC is being reviewed again next year, and it is important that we from the fishing industry look closely at the shortage occupation list.
I would be delighted. We have discussed the case in the past, but I would be delighted to meet the right hon. Gentleman to discuss it again.
Moving on to exports, which the hon. Member for Plymouth, Sutton and Devonport alluded to, while we had a difficult start to the year, the sector is showing real signs of improvement. August seafood export values were similar to pre-pandemic levels. Some EU and indeed non-EU exports are still down, but UK salmon exports are up significantly, by 25% on pre-pandemic levels. As hon. Members understand, there is a complicated combination of difficulties, very much related to the closure of hospitality across Europe, which have made exports really challenging this year.
We continue to support exporters through our seafood industry forum on trade and to engage as closely as we can with industry. One particularly useful taskforce was set up by the new fisheries envoy, my hon. Friend the Member for Banff and Buchan (David Duguid). We will continue to work with the sector, particularly through the Scottish seafood industry action group, to overcome future export challenges.
A number of hon. Members asked about licensing; for specific numbers, I refer them to the written ministerial statement that I laid a couple of weeks ago. Under the terms of the TCA, almost 1,700 EU vessels have now been licensed to fish in our waters. We have granted 98% of EU applications for fishing licences, 123 of them for the six to 12 nautical mile zone.
We are taking a reasonable and evidence-based approach to licensing that is compliant with the TCA. We have been extremely flexible about the evidence we will accept, even accepting survey data, for which we paid, when no other information is available. We have engaged in extensive discussions with the European Commission and French authorities—I last met the commissioner on Friday. Where the evidence provided has been satisfactory, licences have been issued. Where it has not, the door remains open to looking at more evidence.
We continue to work with the Commission and the French authorities on an approach to direct replacement vessels, and we are working very hard on that at the moment. The arrangements for the Crown dependencies under the TCA are slightly different from those for the UK. Both Jersey and Guernsey are taking a reasonable and evidenced-based approach to licensing and we are supporting them wherever necessary.
In conclusion, it is clear that we are making progress since leaving the EU. We are in the middle of annual negotiations, where we think we will be able to secure the fishing opportunities we need. I look forward to sharing the outcomes of those opportunities with the House.
I will not, because the hon. Member for Strangford is about to close the debate.
The additional quota uplift provided for in the TCA has been apportioned among nations using a blend of track record and zonal attachment, and we will look at how we review that work for future years. I admire the industry for its resilience and feel confident that the £100 million will provide the support the sector needs. Under the terms of the TCA, we have granted 98% of EU applications and are working well on the outstanding issues. There is still work to be done and I look forward to working with all Members to ensure that our fisheries are managed in a sustainable way that protects our marine environment.
I thank all right hon. and hon. Members for their contributions. The combination of viewpoints in the debate shows that the fisheries sector is important for all parts of the United Kingdom, and our debate has encompassed all parts of the United Kingdom. The right hon. Member for Scarborough and Whitby (Mr Goodwill) referred to the stocks of prawns coming across to Northern Ireland, reinforcing the point that we need each other. We had hoped for some comment from the Minister on how her meeting went with Edwin Poots—I am sure she will follow up, as she always does.
I thank each and every person who spoke today, including about infrastructure and safety on the boats. The hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) spoke about promised fish becoming paper fish. We need the promised fish. As I said, we need action, not words. We need the words and the action to follow the words.
The right hon. Member for Orkney and Shetland (Mr Carmichael) referred to the availability of crew. He, I and others in the House have pursued that issue unashamedly over some time. The Minister referred to a review in the new year. I think we will all feed into that review, and I look forward to it. The hon. Member for Edinburgh North and Leith (Deidre Brock) referred to fishing being the most dangerous job in peacetime. We need safety on the boats.
I welcome the shadow Minister, the hon. Member for Cambridge (Daniel Zeichner), to his place. I thank the hon. Member for Plymouth, Sutton and Devonport for all that he has done in his contributions in this House.
The Minister referred to the importance of fishing for the United Kingdom of Great Britain and Northern Ireland. We thank her for all her hard work and her endeavours on behalf of the fishing sector and for the special relationship she has—if I can say that to other Members—with our spokespersons in Northern Ireland. We wish her well in the negotiations, because she will be our voice for all the United Kingdom of Great Britain and Northern Ireland. We need each other. I always say that we are better together. The United Kingdom of Great Britain and Northern Ireland is better together, fighting together and standing together, with our Minister at the forefront.
I too would like to extend praise to the hon. Member for Plymouth, Sutton and Devonport (Luke Pollard) for all his hard work and his contributions.
Question put and agreed to.
That this House has considered allocations to UK-EU fisheries following the UK’s departure from the EU.
Wales’s Contribution to UK Armed Forces
I beg to move,
That this House has considered Wales’s contribution to the UK armed forces.
It is a pleasure to see you in the Chair, Ms McVey. I should start by declaring an interest, in that my partner is a serving member of the armed forces, based at the Infantry Battle School in Wales.
A little over 18 months ago, I had the privilege of leading my first debate as a Member of Parliament, in which the same subject was considered. That was in February 2020 and of course since then the world has changed, and changed again. I secured this debate as a Member of Parliament with the rare privilege of representing Army, Navy and Royal Air Force facilities in their constituency. I applied for the debate last week when I was sitting in my office thinking of ways I could pile further pressure on the Ministry of Defence regarding its plans to close, in 2027, Brecon barracks, which is an historic site in the heart of my constituency. I have been campaigning on that issue since the moment I was selected as the Conservative parliamentary candidate for Brecon and Radnorshire. It is fair to say that I have made something of a nuisance of myself with MOD Ministers, given the number of times that I have raised the issue. One Minister even told me that I was close to the point of becoming “embarrassing”. But the significance of Brecon barracks to my constituency simply cannot be overstated.
The barracks is the home of the Army in Wales. It is the epicentre of our military history and home to the regimental museum of the Royal Welsh. The 24 trees on the Watton in front of the barracks represent the 24th Foot Regiment, which fought at the battle of Rorke’s Drift, immortalised in the film “Zulu”. However, the barracks is not just about a good film and some shiny mess silver. Its operational significance was underlined once again earlier this year when the armed forces’ incredible MACA—military aid to the civil authorities—support to people in Wales was stood up from within the Keep in Brecon barracks. At this point, I want to pay tribute to Brigadier Andrew Dawes, who I hope is watching this debate. Head of 160th Brigade and head of the Army in Wales, he oversaw Operation Rescript on behalf of the Army in Wales. I pay tribute to him and all his team for that crucial work.
It was absolutely vital to campaign to keep the barracks, and I pay tribute to all those who joined the fight, but particularly my predecessor in this role, Chris Davies, and my counterpart in the Welsh Parliament, James Evans. I knew that we were on the right track back in January when Defence Ministers announced a partial change of mind in committing to keep Army HQ in Brecon—after coming with me to the barracks to see the site for themselves. But the phone call last Wednesday night from my hon. Friend the Minister for Defence Procurement announcing that the barracks would be retained was truly as if Christmas had come early. Culturally, economically and socially, this is vital news for Brecon—a shot in the arm for a town that is often forgotten about by Ministers in Cardiff Bay.
My hon. Friend, like me, is a border MP. We are very proud in Shrewsbury of being a gateway to Wales, and we have many Welsh citizens and many Welsh veterans living in our constituency. I am very grateful that my hon. Friend is having this debate. I would like her to accept our best wishes from Shropshire about the very strong links that bind us, and our Union, through the armed forces.
My hon. Friend is absolutely right. I am very happy to send our best wishes back to our friends, neighbours and colleagues just across the border.
I am so grateful to the Ministry of Defence for bearing with me in my campaign to keep the barracks open, for listening and for being perhaps so scared of coming to this Westminster Hall debate today that it decided to keep the barracks open. Last week’s announcement by the Secretary of State did so much more than just committing to keep the barracks in Brecon. Bringing the Welsh cavalry, the Queen’s Dragoon Guards, back to Wales is a strong sign that this Government are committed to Wales and to the Union. Soldiers from the QDG have told me just how much they wanted to come home, so I warmly welcome that move—even if they are going to Monmouthshire and not Powys.
I too am delighted that the Queen’s Dragoon Guards are coming back to Wales. The original place where they were planned to be sited was St Athan in my constituency. Does my hon. Friend share my concern that the Welsh Government had not made land available for the armed forces so that the Queen’s Dragoon Guards could come to St Athan, which was the originally preferred site? For our Union’s sake, the Welsh Government need to play their full part in welcoming the armed forces to all parts of Wales.
I absolutely agree with my right hon. Friend. He expresses an important point in very clear terms, which I will talk about later. As a result of the Secretary of State’s announcement last week, Wales will see an increase in the Army footprint from 6.7% to 7.3%. A new Reserve unit in Wrexham will significantly increase the presence in the north. I pay tribute to my hon. Friend the Member for Wrexham (Sarah Atherton), who has campaigned so diligently on that. Combined with an Army Reserve of more than 30,000, the British Army will be more than 100,000 strong.
As I mentioned at the beginning, the world has turned significantly since we last came here to discuss this issue. In Wales, over the course of the pandemic, we have once again called on the support of our armed forces. The Army has organised and conducted more than 74,000 tests, 11,000 ambulance responses and almost 70,000 covid vaccine inoculations. Those numbers will certainly have increased since those data were recorded. The Army continues to support the Welsh Ambulance Service by crewing ambulances. It is essential to remember the civilian role played by our armed forces. It can be quickly forgotten but we must take every opportunity to show our gratitude, not just on Remembrance Day.
I know how much people in my constituency appreciate that support from the shifts I did as a volunteer at my local vaccination centre on the Royal Welsh showground at Builth Wells. We were fortunate to be joined by members of the RAF band, who were deployed to Builth, Bronllys and Ystradgynlais as part of the vaccine roll-out. Yesterday, I was back at the showground for the winter fair and was delighted to learn from the chief executive that members of the band have been invited back to the Royal Welsh show next July for a celebration event.
We saw earlier this year that the armed forces deliver for Wales, but Wales also delivers for the armed forces. Even during the pandemic this year, I was delighted to visit Exercise Cambrian Patrol organised in my constituency. I pay tribute to everybody who managed to get Exercise Cambrian Patrol off the ground again this year. This fantastic event, known well to all armed forces personnel, is an arduous challenge of more than 40 miles. Teams of eight come from around the globe to compete in the Black mountains and the Brecon Beacons national park. It is the Olympic gold medal of military training and I am delighted it takes place in Wales. I congratulate all who took part this year.
So far this speech has been full of nothing but praise for the Government, which is somewhat unusual for me. When discussing our service personnel, it is imperative to consider our support for former service personnel in Wales, and I do feel that veterans in Wales are being short-changed. They are unable to access the same kind of support that their counterparts in England, Scotland and Northern Ireland can rely on. Wales is currently the only country in the United Kingdom not to have the support of an independent veterans commissioner. For years, Welsh Conservative colleagues in the Senedd in Cardiff have been arguing for that role to be created. Of course, the armed forces are a UK-wide policy area but, with public services in Wales devolved to the Welsh Government, Ministers in Cardiff Bay need to agree to recognise the role, in order for it to make a meaningful difference.
I congratulate the hon. Lady on the debate and the points she is making, particularly highlighting the work of our armed forces during the pandemic. I am sure she will agree that we need to highlight the work of the Welsh Government in funding the seven armed forces liaison officers who are currently working across Wales and the work the Welsh Government are doing with the NHS pathway, hoping to have that health and social care support. Does she also agree that the reluctance of the Government to agree the future of the Office for Veterans’ Affairs will hamper that work going forward?
I thank the hon. Member for his intervention. I certainly agree and pay tribute to all of the armed forces liaison officers that we have in Wales. I was about to talk about them. I am due to meet the armed forces liaison officer for Powys in the next few days. They do fantastic work—long may they remain in post. However, there is a role for someone to oversee that work so that, as a veteran moves around Wales, they can guarantee the same kind of mental health support and education provision. That consistency is key.
In 2013, the late and much missed former Minister in the Welsh Government, Carl Sargeant, expressed support for creating the role of the veterans commissioner, but argued that funding had not been made available by the UK Government. However, after much persistence from a number of colleagues, including myself and my hon. Friend the Member for Wrexham, our right hon. Friend the Chancellor announced the funding in the Budget this year specifically for an Office for Veterans’ Affairs in Wales. As it stands, Westminster Ministers have written the cheque and Ministry of Defence Ministers are willing to start interviewing candidates, but the Welsh Government continue to play for time. I cannot understand why the Welsh Government in Cardiff Bay are reluctant.
As I mentioned in my response to the hon. Member for Merthyr Tydfil and Rhymney (Gerald Jones), a veterans commissioner would oversee public services in Wales and make sure that they work for the tens of thousands of former military personnel across Wales, especially those who live in Brecon and Radnorshire. More than that—this is the point I was making—that person would ensure that the mental health support available to veterans is consistent whether they live in Brecon, Beddgelert or Barry Island. It is time for Welsh Labour to stop neglecting this community. Once again, I find myself urging the Welsh Labour Government to confirm that they will give the role their blessing and work with us so that the process can go forward.
I know other colleagues want to contribute, so I will bring my remarks to a close. If I have waffled in my speech, it is because the Ministry of Defence has forced me to rewrite it at the last minute. I came here to give the Government another broadside on the barracks and to press once again for the QDG to come home. The Secretary of State stole my thunder, but I could not be more grateful. Although this could be the opportunity for me to restore my credibility with the Ministry of Defence and go quietly, it is time for me to think of a new campaign that will help the Government demonstrate their support for the armed forces in Wales.
It is a pleasure to serve under your chairmanship, Ms McVey. I congratulate my hon. Friend the Member for Brecon and Radnorshire (Fay Jones) on securing this debate.
It might seem strange that I wish to speak today when I represent a constituency without a major military presence, but we have deep and real connections to our armed forces in Aberconwy. As a member of the armed forces parliamentary scheme, I have been privileged to visit military bases across the UK to speak to enlisted men and women and officers. A recurring theme in conversations is the importance of people. The commanding officer of HMS Dragon, for example, spoke more about the team around him than the £1.2 billion vessel we were standing on at the time.
I cannot speak today about Wales’s contribution to the armed forces without speaking again about Welsh veterans. I am proud to say that in Aberconwy we have many, and we are home to several inspirational charities that offer support. It has long been recognised that active military service has the potential to adversely impact mental health and wellbeing, with physical, mental and emotional symptoms commonly reported by veterans. I note and welcome the comments of my hon. Friend the Member for Brecon and Radnorshire about the importance of support, and I ask: is it the place of the Welsh Government to stand between UK funds being made available for UK citizens in such a way at this time?
Concerns regarding impaired health and wellbeing have achieved a high profile recently. I want to take this opportunity to thank the veterans of Aberconwy for their years of service to the United Kingdom. I also wish to pay tribute to organisations throughout Aberconwy that work in their support, including the Royal British Legion, Blind Veterans UK and Homes for Veterans Cymru-Alabaré. Those are established, but on Saturday I had the extra pleasure of meeting a new initiative—the Military Minds football club. The founders—David Owen, Ryan Davies and Kyle King—and I sat together in Llandudno. They have set up that new charity football club to help veterans, and I have no doubt that this initiative will provide support in the months and years ahead. As someone who is passionate about football and about supporting our armed forces and veterans, I will follow their adventure with interest.
In truth, we do have a military presence in Aberconwy. The training camp in Capel Curig has been the temporary home to many thousands who have trodden our hills in pursuit of physical and technical expertise: Snowdonia/Eryri offers a unique environment for that. However, I do not want to speak about what happens on our hills, but about what happens in the skies above them. Along the coast, at RAF Valley in the constituency of Ynys Môn, is the training centre for our fast jet pilots. The UK and our allies face ever-greater and ever-changing military and security threats, especially from an increasingly belligerent China, Russia and Iran. Among many responses being developed, this year, for the first time in over a decade, a carrier strike group of the Royal Navy—the senior service—sailed on active operations. After 11 years without aircraft carriers, it is a milestone of note that the UK has re-established our ability to project air power from the sea once again.
The pilots of the RAF and Royal Navy F-35 Lightnings are trained at RAF Valley, one of the finest centres of military aviation in the world. There is a whole force team there of over 1,500 people, which is an important contribution—a Welsh contribution—to the UK’s ability to defend our interests and our allies around the world. Crucially, those training flights bring those jets over Aberconwy. There is no doubt that the sound of birdsong and insects on a sunny day in Dyffryn Conwy is a thing of beauty: it nourishes the soul. There is also no doubt that that bucolic idyll is shattered by the noise of the Texan T1s, the basic fast jet training aircraft used at RAF Valley. I know that this can be a real source of annoyance, and even distress, to many of my constituents. I acknowledge those concerns and have been working with colleagues to mitigate this issue, moving more flights over the sea rather than the land and reducing the windows during which those flights take place. I am also encouraging colleagues in the Ministry of Defence to make more effort to explain the work that is happening. This is a partnership—a real relationship that needs communication, and can be helped only through greater and better understanding.
For now, while I continue to represent the concerns of constituents who are affected by the sound of those swirling, soaring Texans overhead, whether in their homes, in their businesses or on their farms, I must also recognise that it is the sound of freedom. This is a real price: a local contribution that many pay daily. It is a real part of Wales’s and Aberconwy’s contribution to our nation’s defence, so in conclusion, I offer my thanks to my constituents for the part they play.
It is a pleasure to serve under your chairmanship, Ms McVey, and I thank my hon. Friend the Member for Brecon and Radnorshire (Fay Jones) for securing today’s debate. With the Defence Secretary’s recent future soldier Army restructuring announcement last week, this is a fitting time to discuss the benefit of Wales to the UK armed forces. As a Welsh MP with an interest in veterans and our armed forces, and who sits on the Select Committee on Defence, this is comfortable ground for me. I want to touch on two points: first, the Welsh military footprint, and secondly, the contribution made to the defence sector in Wales more widely.
Wales has a proud military history, as indeed does my constituency. Wrexham is home to Hightown barracks, once the home of the Royal Welch Fusiliers, whose roots date back to 1689. Last week’s announcement by the Defence Secretary is hugely welcomed: Hightown barracks will now house a reserve company, the 3rd Battalion The Royal Welsh. The barracks, once destined to become a housing estate, now has a new lease of life and will regenerate the military stamp in Wrexham. Although there will be a scaling down of the Army mass nationally, I am pleased that Wales is the only nation not to see a reduction in its capacity or capability, and the announcement of a £320 million investment in Wales to enforce this is most welcome. If there were to be one example of Wales’s contribution to the armed forces and the UK Government’s commitment to the military in Wales, this is it.
I will not reiterate the comments that my hon. Friend the Member for Brecon and Radnorshire made about the armed forces’ extensive contribution to the Welsh Government’s covid recovery plan, nor will I reiterate the need for the Welsh Government to get on board with a veterans’ commissioner. I know that another Member wants to speak, so I will just make one other point, which is about the significant contribution that the defence sector makes in Wales in jobs, opportunities, equipment, the supply chain and the defence pound. We have a large military footprint in Wales, with over 4,000 jobs in the military chain alone. North-east Wales is a hub for defence businesses, including Qioptiq in St Asaph; Airbus in Broughton; MOD Sealand, which is home to the Defence Electronics and Components Agency and sits on the border with Chester; and Raytheon at Hawarden airport. Earlier this month, Raytheon was awarded a £110 million contract to upgrade the RAF’s Shadow surveillance aircraft, creating hundreds of new jobs in the area, including in my constituency of Wrexham. All those companies have invested in the covenant, making the gap between the serving and civilian sectors smaller, and in the workforce not only of the present but of the future. With this Conservative Government’s vote of confidence in Wales—the cancellation of the closure of Brecon barracks, subjecting future generations of soldiers to the wild delights of the Beacons, and the boost to Hightown barracks in Wrexham—the symbiotic relationship between the military and Wales is clearly defined for the future.
It is pleasure to respond to the debate under your chairmanship, Ms McVey. I congratulate my hon. Friend, the outstanding Member for Brecon and Radnorshire (Fay Jones), on securing not only this debate but so many debates on the future of Brecon barracks. The armed forces in Wales have an extraordinary ally in her, and she has made her mark in speaking up for them and, particularly, for her constituency. She is right to say that she has changed the MOD’s mind. Her predecessor struggled—in fact, did not find the time at all—to ask any questions in Parliament about the future of the barracks. That goes to show what a sound choice the people of Brecon and Radnorshire made in returning her in 2019, so that she can take up the fight on behalf of the community, something that matters enormously to them, and what a fantastic champion they have in their MP, who takes these local issues to Ministers so persistently and brings home victories.
I also thank all those who have joined the debate today. It is great to see such fantastic attendance, which underlines that the armed forces in Wales are supported well by all their MPs. I pay particular tribute, of course, to my hon. Friend the Member for Brecon and Radnorshire, but I have found that, in all my dealings with Welsh MPs, there is support for our armed forces that crosses party lines. I know that that matters enormously to our armed forces in Wales. I hope that the First Minister will take this in the spirit in which it is intended, but there was a view in Army headquarters that he might not be the most responsive to a relationship with the military. However, I know from the team in Brecon that he has worked enthusiastically alongside us in the last 18 months, and we are very proud of the way in which that relationship has developed.
I am encouraged by the Minister’s comments about the First Minister. However, does he share my concern that the Welsh Government prioritised a business park over a major new military unit that was earmarked for St Athan? With the Special Forces Support Group remaining at West Camp, St Athan’s long history with it will remain, but the significance of East Camp will now be lost to a business park as a result of the Welsh Government’s not making land available for a major military unit.
I accept that observation. It is a shame that the full potential of St Athan could not be realised. I know that the Welsh Government take a view on the value of the development that they are undertaking at that site, but clearly, from an MOD perspective, we felt that there was an opportunity to develop further. That is an opportunity that will now not be available to us.
Some 2,300 recruits came from Wales in the last two years. That means that, as a ratio of population, Wales outperforms England in recruitment to our armed forces. Indeed, 7% of new starters in the Royal Navy and the Royal Marines were from Wales over that period. There are 2,100 regular armed forces based in Wales. As we have discussed, the return of an additional unit to Wales means that an increased percentage of the UK armed forces will be based in Wales as a consequence of what was announced earlier in the week.
The Welsh units have been busy. The 1st Battalion the Royal Welsh, the most well-equipped and most highly ready battle group in NATO, was deployed on Operation Cabrit, the enhanced forward presence mission to Estonia. Last Christmas, I had the sad duty of sending them all to the M23 in Kent to swab the throats of truckers as their reward for doing so well in a tour to Estonia. That was particularly hard, given that a friend of mine who I served alongside in 2 Rifles is now the commanding officer of that battalion. They did an amazing job, responding at an hour’s notice to get Dover flowing as quickly as possible. It was a fantastic performance.
The Welsh Guards have been on public duties in London and have also been deployed in both Iraq and Afghanistan. Last week in Mali, although they were keeping a low profile because they are arriving in theatre, the 1st The Queen’s Dragoon Guards are shortly to take over command of the MINUSMA mission, bringing stability and security to a part of Mali that is very troubled indeed. I know that they will do that brilliantly. Indeed, the squadron of 1st The Queen’s Dragoon Guards that has been in Mali for the previous tour under the command of the Royal Anglian Regiment has acquitted itself brilliantly and shown just what a fantastic outfit the Welsh Cavalry is.
It is not just the regulars; the 3rd Battalion The Royal Welsh generated a full company to serve in Operation Rescript—our response to covid. The Royal Monmouthshire Royal Engineers generated a squadron. There have been reservists serving as liaison officers across Wales, working with our police forces, councils and other local agencies in order to co-ordinate the covid response.
I pay tribute to Brigadier Andrew Dawes, who my hon. Friend the Member for Brecon and Radnorshire mentioned. He is an outstanding commander for the British Army in Wales, and he really gets what is required as a regional point of command and interface with local authorities. There have been 36 requests for military aid to civilian authorities, requiring 1,500 troops drawn from 80 units, some from within Wales and many from without. The most high profile of those is the ongoing support to the south Wales ambulance service, where 110 drivers have now been serving for seven months, and have been involved in 15,000 call-outs.
I thank the Minister for giving way, and I register my own interest. Will he say something about the fantastic foreign and Commonwealth soldiers who support Welsh units in the British Army? A lot of them are concerned that they get forgotten and are not supported, particularly when they leave our armed forces. Many settle in Wales and have close relationships there.
I absolutely will. Foreign and Commonwealth soldiers play an extraordinary role in the British armed forces. I suspect that when someone is recruited from Fiji or Grenada and find themselves in Brecon in January, they have a bit of a sense of humour failure, but it is a testament to the hospitality that Welsh people provide that, despite that coldness, they choose to settle in Wales afterwards. I will briefly mention the veterans commissioner, because I think that is important to that point.
Castlemartin, Caerwent and Sennybridge are key training areas used by the British armed forces to prepare us for our operation output, and the fantastic Welsh landscape makes for adventurous training. I note the concern of my hon. Friend the Member for Aberconwy (Robin Millar) about the noise of the fast air over north Wales, but it is a world-class training environment for the very best fighter pilots. It is a tribute to RAF Valley that so many from overseas wish to come and train in that environment.
On prosperity, nearly £1 billion is invested in industry in Wales, generating 4,940 military and civilian roles, 770 private sector jobs and thousands more across supply chains across a range of capabilities from fast air all the way through to armoured vehicles.
I agree that is conspicuous that Wales does not yet have a veterans commissioner, but I am pleased to say that my hon. Friend the Minister for Defence People and Veterans, with officials in the Office of Veterans’ Affairs, is engaged in this. Working with the Welsh Government, we hope to find a resolution on that soon.
Across Wales, there is an extraordinary contribution from our armed forces to the United Kingdom. I hope that the people of Wales reflect on how well the UK armed forces serve them in their hours of need and how well they represent Wales when serving overseas.
In the 30 seconds remaining, I would like to mark the departure of General Sir Nick Carter as Chief of the Defence Staff. He is being drummed out from the Ministry of Defence as I speak. His has been a career of over 40 years’ extraordinary service to our Queen and country. He has done immeasurable good in his time as Chief of the General Staff and as CDS, most notably— I know my hon. Friend the Member for Wrexham (Sarah Atherton) will champion this more than anyone—in ensuring that all frontline roles are now available to men and women. He will be missed, and we welcome his successor Sir Tony Radakin.
Motion lapsed (Standing Order No. 10(6)).
Community Energy Schemes
[Mr Clive Betts in the Chair]
Before we begin the debate, I remind Members that, in line with the guidance from the House of Commons Commission and the Government, they should wear face coverings except when they are speaking. I also remind Members to take a lateral flow test twice a week, which can be done in the House or at home, and to give other Members and staff room and space when seated as well as when entering or leaving the room.
I beg to move,
That this House has considered the matter of empowering community energy schemes.
It is a pleasure to serve with you in the Chair, Mr Betts. I start by thanking Steve Shaw and Power for People, who have worked tirelessly on the campaign to unblock community energy. I also thank the hon. Member for Wantage (David Johnston), who is promoting the Local Electricity Bill in this Session. I am pleased to see the hon. Members for Waveney (Peter Aldous) and for Ceredigion (Ben Lake), with whom I have worked closely on the campaign, in the Chamber. They are enthusiastic champions for community energy in the House, and I look forward to their contributions.
Imagine a future where people can purchase clean electricity directly from a local supply company or co-operative and where every pound spent on powering our homes or cars is recycled back into the local community, supporting jobs, funding new facilities and services and contributing to renewable energy infrastructure. That is what community energy is about: ensuring that people everywhere support and benefit from the clean energy transition.
Solving the climate crisis and meeting our net zero ambitions will require huge changes that will be seen and felt directly by people everywhere. We need a radical shift in industrial systems, technology and business models, which must be underpinned by strong and decisive Government action and the right policies. However, one of the most crucial requirements is bringing people on board for the transition to net zero, because they have to pay for the transition through their energy bills and taxes, they have to host new infrastructure in their neighbourhoods and on their landscapes, and they need to alter their routines and behaviours.
Unless we bring people on board for the transition to net zero, there is a huge risk that the public will not welcome or even accept the necessary changes. The consequences of that will be that our progress to net zero will be much more lengthy, costly and contested, and it will be less inclusive, equitable and environmentally sustainable. The real strength of community energy is its connection to people and places. It is people who make community energy what it is, and it is people who will see the benefits. That is what we are trying to achieve with the Local Electricity Bill.
Community energy is one of the few tried and tested means of engaging people in energy systems. The Bill would lead to energy market reforms that would empower community-owned and run schemes to sell local renewable energy directly to households and businesses. It would make new community energy businesses viable and, by bypassing large utilities, those businesses would keep significant additional value within local economies.
I congratulate my hon. Friend—she is my hon. Friend on this subject—on securing the debate. As I understand it, the Government argue that the means to enable new suppliers to come into the system are available. However, when I recently inquired about how many Licence Lite applications, which are meant to help new energy suppliers enter the market, had been granted by Ofgem, the answer was that three licences have been granted since 2015 and none has been applied for since 2019. Might that not suggest some changes are needed to make it easier for new suppliers to enter the market?
The right hon. Gentleman is absolutely right. Something does not work, and I will come on to why it does not work. The whole system is outdated and does not allow for the changes that we need to make to get to net zero. We have to test what works on the ground. The number of licences that have been granted speaks for itself. We have made no progress, yet the Government accept that community energy is a good thing and we should all support it.
I congratulate the hon. Lady on securing this debate. On the issue of the Government saying it is a good thing, does she agree that the trouble in this country is that community energy is seen as a thing on the side? It is a cherry on the cake, and not the substantial part of the energy mix that it could be, as it is in places such as Germany, where there is a right to sell to the rest of the community. When we have that, we end up with a proliferation of local energy companies, a real diversity and ecology of energy companies, and a much stronger sector as a result.
In other countries there are much more diverse markets for this, and we really have to look at why it does not work in this country. I agree with the hon. Lady—absolutely, it has to be at the core of the transition. It is about power and people, so we are here to make a strong case to the Government to listen and really understand the benefits of local community energy.
I fear that much of the difficulty that we will encounter in promoting this case will be found along Millbank in Ofgem, which has never been an enthusiast for this sort of diversity in the market. In the northern isles, we have the highest rate of fuel poverty anywhere in the country. We already produce more clean electricity from renewable sources than we can use. We do not have the opportunity of exporting that to the transmission grid, so I am happy to offer us up as an early testbed for community energy.
If I were the Government, I would happily take up that offer. It is about the surplus energy that can go back into the community. If we look at the crisis in the energy market and the fact that people will probably face higher prices, anyway, the Government’s argument that there might be unintended consequences, particularly around price, has proven not to be the case. It will ultimately become cheaper if we go along the lines of community energy.
I am grateful to the hon. Lady for giving way and for securing this debate. In dealing with the objections to the course of action that she is setting out, she will know that the Government maintain that the right to local energy already exists. Does she agree that the right way to look at that is the way I look at my right to buy a Ferrari, which already exists, but my financial obstacles to doing so are considerable, and that that is true in the case of community energy too?
I thank the right hon. and learned Gentleman for that analysis. Do we all want Ferraris? Who knows? But we probably all want community energy. The problem is indeed the cost of entry for small local suppliers, and that is what the Government need to look at. As we have already heard from the right hon. Member for Leeds Central (Hilary Benn), it does not work on the ground. When the right exists, fine, but what is the practice? We need to look at what we can do to change the practice and at what is affordable for the small companies that want to enter the market.
The hon. Lady is being very generous with her time. As I have said in previous debates, I have local constituent groups who are dead keen on community energy and really want to be able to rise to the opportunity. In addition to rising to climate change targets and reducing emissions, there is an issue about resilience to climate change. We now have people in different parts of the country who have been without power for four or five days because of climate change-related weather storms. If we had local generation, there would be additional resilience in the system that would perhaps protect or shelter people a little bit from some of the damaging consequences of changing weather.
The hon. Gentleman makes a very good point. Lots of small and diverse players are probably the answer to our future energy demands. The Government in the past have always considered bigger is better, economies of scale and all the rest of it, but we need to look much more favourably at smaller, diverse suppliers.
I need to make some progress, so I will remind everybody where we were. The Bill would lead to energy market reform that would empower community-owned and run schemes to sell local renewable energy directly to households, rather than small companies buying energy from bigger companies, then selling it on. It would make new community energy businesses viable and by bypassing large utilities, they would keep significant additional value within local economies. More of the money that we use to pay our electricity bills would circulate back to our local communities to create more skilled local jobs, more viable local businesses, stronger local economies and greater resilience.
Let us take my constituency of Bath as an example. Bath and West Community Energy has delivered 12.35 MW of community-owned solar photovoltaics, in addition to one hydro scheme. Many of these projects have been installed in schools and community buildings across Bath, including Ralph Allen School, Oldfield School, Walcot rugby club, Newbridge Primary School and Lewis House. Bath and West Community Energy systems generate enough electricity to match the annual equivalent of 4,000 homes. They have distributed nearly £300,000 back into local community grants, which go into supporting community action on carbon reduction and fuel poverty, which has been mentioned.
The group supports a wide range of schemes, ranging from community orchards and reuse and repair schemes to fuel poverty advice and even a cycle-to-work scheme using e-bikes. I am delighted that our local electricity distribution network operator, Western Power Distribution, is a registered supporter of the local electricity campaign. However, there are a number of problems facing local suppliers, including those in my constituency. Bath and West Community Energy has identified and is developing nearly 40 MW in a pipeline of projects that will work with communities, commercial developers and site owners, but its ability to commission the pipeline will depend on a number of different factors.
One key factor is grid capacity. This area is currently heavily constrained. Investment is needed in grid improvement, but Bath and West Community Energy must compete with commercial companies with much more resources to secure a grid connection. Smaller operators do not have the financial resources that big commercial operators have. Another factor is partnership with local authorities. There is huge potential, and I am delighted that Bath and North East Somerset Council supports the Local Electricity Bill. Councillors keep telling me how popular community energy projects in their wards are in the consultation stages, but many projects do not make it to reality. There must be stronger support for local authorities to establish joint ventures and utilise local authority finance to invest in local community projects that generate local social and economic benefits on both public estates and in the wider community.
What is the biggest barrier to community energy? It is the right to local supply. Current energy market and licensing rules mean that community energy schemes to build new renewable generation infrastructure and then sell power to local customers face costs that are too high to make the schemes financially viable. A report by the Institute for Public Policy Research states that the financial, technical and operational challenges mean that initial costs exceed £1 million. As the Environmental Audit Committee has said, community energy contributes 278 MW of renewable energy as of 2020. That is less than 0.5% of total UK electricity generation.
Community energy has seen almost no growth in the past six years—a great waste of potential. However, there is a solution. I urge the Minister to add his support to the Local Electricity Bill, which was introduced by the hon. Member for Wantage and is supported by 281 MPs from all parties. The Bill sets out the mechanism that can fix the UK’s local supply problem. Clause 1 states the purpose of the Bill—to enable the local supply of electricity. Clause 2 sets out the aim of smaller-scale renewable generators to supply electricity directly to a local area. Clause 3 gives Ofgem the task of setting up the local supplier licence process. Crucially, it requires that the process ensures that local suppliers face set-up costs and complexity proportionate to the scale of their operations.
Is the hon. Lady not right that clause 3 is the nub of this Bill, because all too often in regulation we have a one-size-fits-all approach that is not proportionate to the scale of the operation or the ambition? If a specific duty was placed on Ofgem to ensure that both the regulation and the cost were proportionate to the size of the ambition and the operation of the local generator, we would see that 0.5% figure rise quite dramatically.
Indeed—I completely agree. I urge the Minister to look at clause 3 of the Bill, which would give Ofgem the task of setting up the local supplier licence process, which should be proportionate to the size of the operator.
The Government have said many times that they support community energy; I am grateful for that, as are all of us in the Chamber. In the last debate on community energy, the former science Minister, the hon. Member for Derby North (Amanda Solloway), outlined the Government’s agreement with the broad intentions of the Local Electricity Bill, which was very welcome.
Those who support the Local Electricity Bill accept that it can be improved. We want to work constructively with the Minister and his Department to improve it, so today I will address some of the Government’s concerns. I will take each concern as outlined by the Government in turn.
First, the Government have said that there is already a right to local supply through existing rights and flexibilities, but we have heard why that system probably does not work; Ferrari analysis springs to mind. The existing rights and flexibilities simply do not address the problems faced by local suppliers. The huge potential for more community energy generation is not being realised. Community energy has seen no significant growth in the last six years, standing at a mere 278 MW of electricity generation capacity. No existing community energy group in the UK is licensed to sell its electricity directly to local customers.
Licence Lite, the scheme set up in 2009 to award geographically-based energy supply licences, has resulted in only three such licences being granted since the scheme was established. The key flaw in Licence Lite is the need for local renewable generators to partner with a willing licensed energy utility.
Secondly, the Government say that changing the rules risks distortion in the energy system. The energy markets and the energy system are the result of the rules that govern them. These rules are much as they were when they were introduced for the 1990 privatisation. They might have made sense at that time, but now that there is such huge potential for distributed smaller-scale renewable generation they are now outdated.
Thirdly, the Government say that changing the rules risks increased costs for consumers. The evidence shows the opposite. In 2020, community energy organisations spent nearly £900,000 on energy efficiency upgrades, helping over 45,000 people to reduce their energy bills. A twentyfold increase could be achieved from community energy schemes by 2030.
Fourthly, the Government say that changing the rules risks further unintended consequences. However, they have not really outlined what those unintended consequences are, so I hope that the Minister can say what he thinks they might be. Those of us who support the Bill want to work together with the Government, as I have said.
I draw the Minister’s attention to a recent report from the UK Energy Research Centre, to which academics from Imperial College London have made a significant contribution. It is a very important report, and it identified five different business models that could work together to ensure a thriving community energy sector. It is clear not just about the important role that collaboration between communities and the private sector has to play in community energy but about what the Government must do to support community energy solutions.
The report also says that the Government should set clear and sustained targets for growing the community energy sector, and introduce policies and regulations that allow space for small actors, which we have heard about. That must go hand in hand with sufficient investment in energy efficiency retrofitting, an area where the Government do not have a very good record.
I have three questions for the Minister today. I have sent them to him in advance, so I hope that he has had time to prepare his response to them. My first question is simple: will he commit to including the Local Electricity Bill in future energy legislation? Secondly, he said in recent letters to Members of this House that the Local Electricity Bill risks creating distortions in the energy system and having other unintended consequences—apart from the increased cost, which I have addressed. Can he outline what these distortions and consequences are, because knowing them will allow me and other supporters of the Bill to work on improving it?
Finally, I wrote to the Minister earlier this month, together with the hon. Members for Wantage, for Waveney, for Ceredigion, as well as the hon. Member for Glasgow North (Patrick Grady) and the right hon. Member for Leeds Central, asking him to meet us. We are keen to work constructively with the Government. Will he agree to that meeting? There is a great deal of cross-party support for the Bill, as we can all see in this room. We have an opportunity to do something significant on our path to the net zero transition, building the public consensus we need. Otherwise, we might face significant delays to deliver the necessary changes. Community energy is not just nice to have and it is not just a cherry on the top of a sustainable economy cake; it should be at the heart of what we do to get to net zero.
It is a pleasure to serve under your chairmanship, Mr Betts. Congratulations to the hon. Member for Bath (Wera Hobhouse) on securing today’s important debate.
I want hon. Members to imagine a future where they can purchase clean electricity directly from a local supplier that is owned and run by local people. Storm Arwen this weekend certainly demonstrated the power of the elements back home in North Devon. As we transition to net zero, we need to harness more of our renewable energy resources as efficiently and rapidly as possible. Local energy supplies have the additional community benefits that every pound spent powering our homes or cars could support local jobs, help fund new facilities in our communities and contribute to more renewable energy infrastructure. That future is within reach and realising it is vital if we are to ensure that the British public welcome and benefit from our transition to net zero.
We have made great strides in decarbonising our economy. Our greenhouse gas output is 51% lower today than it was in 1990. Currently, renewable electricity accounts for 14% of our total energy use and that is set to rise significantly as we further decarbonise and build up our energy security. I very much hope that floating offshore wind generated in the Celtic sea will be part of that in the not-too-distant future. Achieving net zero presents the serious challenge of growing our electricity generation at least twofold, so that transport and heating can be decarbonised, and building the renewable generation infrastructure to power it.
Is that not the key point? We need to increase our renewable generation of electricity, but the reality is that where there are projects, especially in rural areas, there is often a fair bit of opposition, above all when it comes to onshore wind. One way of addressing that concern is that if communities believe they will have ownership of and the benefit from that development, that will bring people with us. To achieve our ambitious targets, we must take people with us, and that is one way of doing so.
I agree entirely with the hon. Gentleman’s point. It is an opportunity to bring our communities with us on this journey, which is so vital to the whole purpose of the Bill and its objectives. In the face of soaring international gas prices and global energy pressures, surely we should be welcoming that challenge.
There is remarkable potential for community energy and renewables schemes owned and run by local people in helping us reach net zero on time. As the hon. Member for Bath said, currently community energy generates around 0.5% of our electricity. As the Environmental Audit Committee showed in its recent community energy inquiry, by 2030 community energy could grow by at least 20 times, powering 2.2 million homes and saving 2.5 million tonnes of CO2 emissions every year. Other countries such as Germany already have more than 1,000 supply companies, compared with just 50 here in the UK. One does wonder what is stopping us doing that already.
Currently, the energy market rules lead to costs—the Ferrari costs—that make doing that impossible. The financial, technical and operational burdens involved in setting up a licensed energy supply company mean that initial costs exceed £1 million. It is like setting up a micro-brewery, planning to deliver beers to local pubs, restaurants and homes, and then being told to pay £1 million in road tax for a delivery van because it is using the national road network. The business would never be started. To realise community energy’s huge potential, we need to enable current and future schemes to sell their power direct to local consumers. That requires making the cost faced in selling power proportionate to the size of an energy business. New community energy schemes would then be financially viable and their enormous potential would be realised.
The Local Electricity Bill, which I am proud to co-sponsor, and which enjoys the support of 282 MPs—another joined this weekend—would do that. The Bill would improve the market rules to allow community energy schemes to flourish alongside larger suppliers. I look forward to working on the Bill, so that it can be another proud stride in our decarbonisation journey and quite literally deliver local power to the people.
It is a pleasure to serve under your chairship, Mr Betts, and I congratulate the hon. Member for Bath (Wera Hobhouse) on securing this important debate.
It is just two weeks since the conclusion of COP26 in Glasgow and I welcome the focus that the debate places once again on how we practically deliver on the UK’s climate targets. We know that the Government’s recent pledge to decarbonise the UK power system by 2035 will require not just leaving fossil fuels in the ground where they belong, but a significant increase in renewable energy generation. Although progress has been made, with renewables generating 42.9% of electricity generation in the spring of 2020 and the Government committing to 40 GW of offshore wind by 2030, it is clear from everything we have heard this afternoon that community energy generation remains the missing part of the equation.
As we have heard many times, a failure to remove the barriers being faced by local suppliers is what is holding us back. Indeed, while large developers will soon benefit from the contracts for difference scheme, projects smaller than 5 MW continue to be excluded. Yet as the Minister will be aware, the potential for community-scale renewable energy generation is enormous. I am particularly delighted to hear the number of times that a report by the Environmental Audit Committee has been cited in this afternoon’s debate already. As a member of that Committee, I was pleased to sit in the deliberations as we came up with the figures that by 2030 the sector could grow by up to 20 times, powering more than 2 million homes and saving 2.5 million tonnes of CO2 each year. It is a very powerful report and I commend it to those who have not yet had a chance to look at it.
The report made it clear that the UK’s outdated regulations are unfit for the present, let alone for the future. As things stand, as the hon. Member for Bath reminded us, community energy generation makes up less than 0.5% of the UK’s total electricity generation and there has been almost no growth in the sector in the past six years. Compare that with a country such as Germany, where there are 200 local energy companies, and with energy systems in countries such as Denmark, which are entirely decentralised. In comparison, the UK is an incredibly centralised four-nation country with an incredibly centralised energy system, and local energy companies have been little more than collective purchasing vehicles.
In other countries, local energy systems incorporate all aspects of generation, storage and supply. Households, communities, schools and businesses become joint producers and consumers in the local energy system, with vested interests in generating clean energy as well as consuming it, yet here at home, as Community Energy England has so clearly set out, Government policies have made it more difficult for the sector to flourish. The outdated market that we have largely dates back to the 1990s, when the sector was privatised, and prohibitive costs combined with the complexity of licensing laws are stifling community energy schemes.
Can the hon. Lady outline that the whole idea does not work because the improvements to the grid have not materialised in the way that we had hoped, or rather the way that the Government had hoped, and that we need big grid improvements to deliver net zero?
I welcome the hon. Lady’s intervention and she is absolutely right. It feels to me as though this absolute reinforcement of the grid is often the poor cousin in these debates and does not get much of a look-in when we talk about what needs to be done, yet it is absolutely critical. If we do not do that, the rest of what we are discussing will not count for much because it will not be possible for it to be realised if the grid is still in the dilapidated state that it is in now.
Earlier this year, the right hon. Member for Ludlow (Philip Dunne), the Chair of the Environmental Audit Committee, on which I am pleased to serve, wrote to the Secretary of State following our inquiry into community energy and specifically recommended that the Government remove the regulatory barriers to allow community energy projects to sell their energy to local communities. The Secretary of State subsequently promised to publish the Government’s future plans for community energy in the net zero strategy, yet disappointingly that strategy contains neither a plan nor the practical support measures needed and that the Committee had recommended. That is why the Local Electricity Bill, of which I am also a proud co-sponsor, is so important, and why it seeks to remedy successive policy failings, by giving people the right to local electricity generation. As others have said, it would create the right to the local supply of electricity, allowing community generators to become local suppliers, and require Ofgem to establish the local supplier licence process, ensuring that the costs and complexity of becoming a local supplier were proportionate. Other measures to support community energy schemes include expanding and extending the rural community energy fund to include urban, heat, energy-efficiency and retrofit projects.
I want to say a last word about how community energy has a role to play in helping to build thriving, resilient communities. I was struck by the fact that in its final report, Climate Assembly UK placed a strong emphasis on fairness and leadership from Government. Community energy is that chance to deliver on both those fronts. Quite simply, enabling community energy projects means supporting thriving communities, where the profits from generation are reinvested locally. It means that, in transitioning to a zero-carbon economy, we are not simply building a new industry on the same old model, with profits concentrated at the top and communities denied a share of the benefits or unable to access the jobs. We are turning that on its head. We are creating something new and better, delivering decent green jobs and energy, investing at a local level in those resilient local economies. That is what a green new deal worthy of the name looks like in practice.
Community energy projects deliver significantly more social value than commercial models. Although the sector currently relies on volunteers, Power for People estimates that almost 60,000 skilled jobs could be created up to 2030, if policies such as those in the Local Electricity Bill are implemented. As I said, community energy is not just a nice-to-have extra to be excited about—the cherry on the sustainable economy cake. It is a fundamental part of the total energy mix.
Finally, I pay tribute to Brighton and Hove Energy Services Co-op—BHESCO—an award-winning social enterprise in my constituency, which since 2015 has completed 58 community energy projects, estimated to reduce CO2 emissions by more than 7,000 tonnes over their operational lifetime. They have told me clearly that they could do so much more if the rules were changed and they were allowed to fulfil their potential. All they are asking for is a fair playing field for community energy projects that now struggle to make a business case, so that they could do the practical local projects that involve people and communities in inventing and adopting climate solutions, which bring huge social and community benefits.
It is a pleasure to serve under your chairmanship, Mr Betts. I congratulate the hon. Member for Bath (Wera Hobhouse) on securing the debate. It appears that debates on community energy are synchronised in the parliamentary timetable to take place every six months. On the one hand, that illustrates the groundswell of support from communities all around the UK to come forward with their own bespoke schemes. On the other hand, the fact that we are turning up every six months would suggest that we are not getting anywhere.
The rationale for empowering community energy schemes is compelling. To decarbonise our energy supply, our transport system and our heating networks we need a shedload of electricity. We need to be firing on all cylinders. Communities around the UK want to do their bit, to play their role in getting to net zero. Imposing a wind farm, solar farm or hydro scheme on a community might well run into resistance, but a community working up its own plans is more likely to get somewhere. Community energy schemes can also play a key role in revitalising local economies, creating sustainable, long-term jobs and promoting a truly circular economy.
To enable community energy to play that full role, regulatory barriers need to come down. Work on doing that needs to start straightaway. Last year, deployment was at a record low. At a local level, local authorities are developing their own climate action plans, and they want to get on with putting them into practice. The one-size-fits-all supply licensing regime—even if there can be regional demarcation—the complexity of the electricity market and the costs of entry are stifling community development. Local price signals are also heavily dampened, and are thereby out of sync with the Government’s stated desire to encourage flexibility at all levels.
There is a need for regulatory reform. I suggest that the following issues need to be addressed. First, it should be made possible to grant derogations from standard licence conditions and to grant supply licences for specific geographical areas or premises types. Secondly, the Department for Business, Energy and Industrial Strategy should ask Ofgem to provide guidance on the steps needed to support community energy and to establish a right to supply. Thirdly, Ofgem itself should give full consideration to the provision of a local supply licence. Fourthly, the reform of the supplier-hub model should be fully investigated. Finally, careful thought should be given to the effectiveness of the smart export guarantee scheme. That should include looking at the range, nature and uptake of SEG tariffs and considering what steps must be taken to improve the route to market for community energy projects.
Although having such consensual debates provides pleasant respite, we need to get on with making meaningful and significant progress on the road to net zero. Local communities have a significant role to play and, to ensure that they can do so, we need to remove those regulatory barriers. I acknowledge that in many respects that is complicated, and there is perhaps a tendency to put it in the “too difficult to do” column. However, there is very limited, if any, political resistance and, in fact, as we are hearing, a groundswell of grassroots support from all around the four nations. I thus request that the Minister ask his team to work with Ofgem to produce a strategy for removing those hurdles, so that, when we next debate community energy, perhaps in six months’ time, it will be when he is making a statement in the main Chamber setting out the steps that he is taking to unleash a wave of community energy projects.
Thank you, Mr Betts, for giving me the chance to speak. I thank the hon. Member for Bath (Wera Hobhouse) for setting the scene for us all, and I praise the hon. Lady for her sterling efforts in bringing the community energy debate to the Hall. The fact that so many have turned up is an indication of the interest in the topic. I spoke in the Westminster Hall debate on enabling community energy that she secured in July, which was chaired by the late Sir David Amess, and I am pleased to be back here to reiterate the benefits of community energy schemes. I thank all right hon. and hon. Members for their contributions, whether interventions or speeches. I am also particularly pleased to see the hon. Member for Ceredigion (Ben Lake) in his place. He had an Adjournment debate on this very issue, which was well attended as well. If he is going to make a contribution, I look forward to it. I hope to be, as we often are, on the same page.
I want to emphasise the importance of allowing local communities the opportunity to advance their own electricity strategies. Perhaps those come at a cost, but a community approach should be at the forefront of any decarbonisation effort. That is where the initiative and inventiveness comes from, and a community approach has the potential to drastically increase renewable energy provision. It may be of interest that currently there is no strategy to target the enabling of community energy. Brief overviews have been discussed, but if we want to focus our efforts on empowering community energy, surely we must have a sustainable plan to do so. I look forward to the Minister’s response, because he always gives us something to hang on to—we look forward to that contribution.
I mentioned in the previous debate that the United Kingdom has witnessed the emergence of 424 community energy organisations. It saddens me to say that Northern Ireland has only two, which is very disappointing. The opportunity for that simply has not been within our reach. There is a reason for that. Community Energy NI and the Fermanagh Trust do much-needed work raising awareness of the benefits of community energy. Their website states:
“Community energy projects also offer an opportunity to help secure the long term financial sustainability of community organisations.”
That is crucial, given that many community organisations have a high dependency on grant funding.
In my office, and I am sure those of all Members, there is massive interest in clean energy, net-zero carbon targets and the need for a better future for our children and grandchildren. Those are the things that motivate us. My mailbag and email accounts are full of such requests and suggestions. We need to have a sustainable plan in place, so that we can move forward. It is safe to say that cost is a huge factor in putting energy companies off investing in localised schemes. Green Alliance has stated that the number of new community energy projects in England, Wales and Northern Ireland has fallen dramatically since 2015, with only one in 2017. I think the right hon. Member for Leeds Central (Hilary Benn) said that there were none at all in 2019.
We are also falling behind most European countries in terms of community energy. If our colleagues and friends in the rest of Europe are doing it there may be something that we can learn from that, and perhaps we can add that expertise to our process. A recent survey showed that 11 million households could be producing or storing their own energy in the UK by 2030, compared with only 1 million today. That is a big target to meet, but it is achievable. Returning to my earlier point, that cannot be done without support from our Government and the Minister, and the availability of grants, to get the idea brought together—the kernel of thought—and make it physically happen.
On regulation, the Local Electricity Bill establishes a right to local supply, ensuring that local energy is financially viable and creates local economic resilience across the United Kingdom of Great Britain and Northern Ireland. However, the Bill, as I mentioned in July, does not extend to Northern Ireland. I know that the Minister is always keen to encourage us in Northern Ireland, so perhaps he could give us some idea of what we can do to make that happen. I encourage him to engage with his counterparts in Northern Ireland—the Economy Minister, Gordon Lyons, and in more rural instances the Minister in the Department of Agriculture, Environment and Rural Affairs, Edwin Poots, both of whom represented Northern Ireland in the recent COP26 talks, where they made a significant contribution. It is important that we are part of that.
I am encouraged that more elected representatives are being lobbied by their constituents to get involved in the energy debate. That is exactly what has happened in my mailbag and the contacts that I have had. I welcome the opening remarks of the hon. Member for Bath. We must ensure that the correct funding for community energy schemes is allocated accordingly, and that all regions of the United Kingdom of Great Britain and Northern Ireland can benefit. Such strategies ultimately pave our way to future economic success. Not only do they inspire organisations and individuals to engage with smaller localised companies as opposed to larger and more populated financial and energy firms, but they have a role to play, which we need to encourage, and I look to the Minister to do just that.
In view of the fact that there is a bit of time left, I thought I would say one or two things. I have come to learn about the Local Electricity Bill. I congratulate the hon. Member for Bath (Wera Hobhouse) once again on securing the debate, and thank all the Members who have supported it. To be honest, I find it a bit frustrating that people who want to do things that will contribute to helping to address the great challenge that we face, which is to change the way in which we produce and consume energy, find difficulties in their way.
I, too, look forward to listening with great interest to what the Minister has to say, because I thought the example that the hon. Member for North Devon (Selaine Saxby) gave of the £1 million and the microbrewery really made the case that it is disproportionate. I would have thought that any Government in such circumstances would be reaching out their arms to embrace those who wish to contribute to generating energy rather than allowing there to be obstacles in the way. We know that connecting to the grid is a problem even for quite large producers. There are a number of new offshore renewable projects, and when we ask how they are getting on, the answer is, “Well, there’s a problem about plugging the wire in when it comes ashore.” Of course, there are a lot of very important technical issues to do with the capacity of the grid and so on, but if we look at this historically, we will see that our energy generation system has relied for a very long time on big places making the energy—it used to be via coal, gas and nuclear—and sending that electricity down wires to all the homes in the country.
The community energy Bill is saying that there is a different model that could help us to reach our goals. I am struck when I hear colleagues talk about the success of community energy in countries such as Germany. I know nothing about the generating and distribution system in Germany, but it gives rise to the question: if they can do it there, can someone please explain to me one more time why we find it so difficult to do it here? The reason I quoted earlier the Licence Lite application figures I had sought was that they suggest to me that this is complex and difficult when we ought to be making it a lot easier.
We can envisage a future in which there are two other benefits. First, we know that getting infrastructure constructed in this country can lead to a lot of objections and difficulties. If the idea of localised nuclear generating facilities, which Rolls-Royce has been talking about, comes to pass at some time in the future, I have no doubt that there will be a lively debate, because it is a much more devolved system of manufacture and distribution of electricity. However, experience surely teaches us that if we give people a stake, they are more likely to agree to the infrastructure being constructed.
I remember from my time as the Environment Secretary hearing from a community that had put up a wind turbine. We know that onshore wind turbines are very unpopular indeed in some parts of the country. That is part of the reason why we have so much offshore wind. However, that community had no trouble getting approval from the village, because people understood the benefits that would flow from electricity generation, and they knew that the money from the feed-in tariff would go towards supporting the local community hall.
When he replies, I hope that the Minister will not only give encouragement but set out the practical steps that the Government are willing to take to make it easier for that to happen. The hon. Member for Bath says that she has requested a meeting, and I join her in that request. It would help all of us who are campaigning—I freely acknowledge that I have come late to this—to understand what the problems are. In the fight against dangerous climate change, the fight to change the way we produce, distribute and use our energy, nobody is afraid of trying to get to grips with the practical changes that are required. We want to support the Government to make the necessary changes.
The problem in Northern Ireland is that if everybody were to convert to electric vehicles, as we are trying to do in relation to net zero, our grid would collapse. With everyone coming home at 6 o’clock at night and plugging in, the grid would collapse. The only way to deal with that is local generation for charging networks, as has happened in some communities in Israel and America. That approach has worked and is working.
The hon. Gentleman raises a really interesting example, because the future will require a huge increase in renewable electricity generation, whether for heat pumps for homes, for cars or for other things. Electric vehicles are an interesting example of thinking about energy in a different way. For example, if the car arrives home and is parked up at 7 o’clock in the evening, and that is when people go indoors to put on the kettle and the TV, we could say, given that there will be loads of car batteries being used, “Between 7 and 11, part of our generating capacity will be the batteries in all those cars. We will draw them into the system, and then when we have gone to bed, hopefully at a reasonable hour, the battery can be charged up to take us to wherever we want to go the following morning.” That is such a good example of how we can think differently about energy generation and distribution, and it is a powerful argument for the Bill, which so many hon. Members are here to support.
It is a pleasure to serve under your chairmanship, Mr Betts. Like other hon. Members, I commend the hon. Member for Bath (Wera Hobhouse) for bringing forward the debate. She set out clearly the benefits of community energy and how it would help on the path to net zero and to empower local communities. She also, importantly, set out the current barriers to setting up community energy companies. That was further illustrated by examples in the contributions of the hon. Members for North Devon (Selaine Saxby), for Brighton, Pavilion (Caroline Lucas), for Waveney (Peter Aldous) and for Strangford (Jim Shannon), and the right hon. Member for Leeds Central (Hilary Benn).
One barrier seems to be that it could cost upwards of £1 million to get set up for a generation licence. We have heard that the Licence Lite option under Ofgem simply is not working, so we need alternatives, and the Government must update rules that date back to the electricity network privatisation back at the end of the ’80s and the early ’90s. The hon. Member for Bath made important comments about bringing people on board. We need everybody to buy into the actions that we need to take to tackle climate change. If people get additional community benefits along the way, that is clearly a bonus.
On that point, as my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards) has alluded to, not only do we need that community buy-in to allow for measures but, for too long, the energy system’s centralised nature has led to a disconnect between the consumer and the generation. By bringing them closer together, we may find that the typical consumer gains an appreciation of what is entailed in energy generation, which may bring beneficial behavioural changes on top of everything else.
I completely agree. Actually, that touches on the point made by the hon. Member for Leeds Central that we have a grid system and a grid charging system still fundamentally based on where coal-fired power stations or nuclear power stations are sited. That needs a complete overhaul. I may touch on that a wee bit later.
Strangford Lough Wildfowlers and Conservation Association in Newtownards came up with a small tidal scheme, which, with a small grant, generated some electricity for its use. The scheme has allowed the club to reduce its costs and keep running. That same process could be used in many cases across the whole of the United Kingdom. Has the hon. Gentleman got any similar examples?
The hon. Member gives a good example. I do not have any specific ones to hand, although I will touch later on how some community energy projects have been held back because of the removal of the feed-in tariff.
It is clear that hon. Members are agreed on the importance of community energy generation, and I am sure that the Minister will stand up and say that he agrees with it as well. The key thing is not just agreeing with the principle but taking action to facilitate the growth of community energy projects.
I, too, am a signatory to the Local Electricity Bill, and I pay tribute to Steve Shaw for his campaigning, dedication and ability to get so many local authorities on board behind the Bill, as well as 282 MPs and 77 national organisations, including the Energy Saving Trust, Good Energy, Forum for the Future, the New Economics Foundation, ResPublica, Solar Energy UK, the British Hydropower Association, Triodos bank, the Transition Network, the Royal Society for the Protection of Birds, Friends of the Earth, the Wildlife Fund for Nature, Greenpeace and ClientEarth. That in itself suggests that the Bill is a good thing and should be implemented.
If we look at the energy retail market, we see how badly it is struggling. We just saw Bulb—the seventh largest company, with 1.7 million customers—go bust, so it is clear that we need alternative solutions for the provision of electricity. Clearly, local powering will not replace an organisation such as Bulb overnight, but, as I say, it is logical to try to facilitate local community-based renewable energy where possible.
Changing the regulations to make new community renewable energy businesses viable allows communities to bypass the large utility companies. It means significant additional value for local economies and, as we have heard already from other hon. Members, more money will then circulate in the local economy, leading to more skilled jobs, more viable local businesses and stronger local economies. As I touched on earlier, it empowers local people and companies to be part of the green revolution and part of the pathway to net zero. That can only help to focus minds and create the general buy-in for the need for collective action to tackle climate change.
Evidence suggests that community energy generation currently accounts for less than 0.5% of the UK total. It has been suggested that it has the potential to increase tenfold over a six-year period. As we have heard, figures from the Environmental Audit Committee suggest it could be a twentyfold increase by 2030. That would more than offset the need for new nuclear power generation, and it is something that the Government need to consider.
The Scottish Government have made strong progress towards community energy, but their efforts have been undermined by UK Government cuts. The Scottish Government had a target for 500 MW of community and locally-owned energy by 2020, which was exceeded and then increased to 1 GW by 2020. They have now doubled the target to 2 GW for 2030. Progress towards the bigger target has been positive, but, as I touched on in response to the intervention from the hon. Member for Strangford, the removal of feed-in tariffs has hindered the growth of those projects. There is a project in my constituency that never got off the ground because of the removal of the feed-in tariffs. By taking away those tariffs, the Government are blocking community energy projects, and they are not doing enough to help facilitate them in a different way so as to allow the sale of energy. That is why urgent action is needed.
The Scottish Government published an updated local energy policy statement in January. Of course, community energy projects in Scotland are further hampered at the moment by Scotland having the highest grid charges in Europe. Lucy Whitford, managing director of Renewable Energy Systems UK and Ireland, has said that
“it doesn’t feel as if charging is fit for purpose anymore for us to deliver net zero. We have worked up some examples of network costs. The additional cost per annum of a 22 MW wind farm in Argyll versus one in Essex could be £500,000. Continuing in the current direction of travel on charging reforms could add another £120,000 per year to a project, so it is very significant.”
That is why I have been calling for reform of the grid charging system.
At the moment we have the cost of living crisis, and the energy cap will increase by between £400 and £600 in April. We have the retail energy market in crisis, with 23 companies going bust since August. In 2018 there were more than 70 companies in the market, but now there are fewer than 30, so Government action is needed to reform the sector.
Meanwhile, the Tories have managed to find £1.7 billion to further develop proposals at Sizewell C, and they want to commit bill payers to a regulated asset base payment contract that will last for 60 years on top of the 10 to 15-year construction period. That is madness. The money would be much better spent on community energy growth, as we have discussed. The Local Electricity Bill is an alternative that will not cost the taxpayer or the consumer any money. In fact, it is intended to help create lower local energy costs. Like other hon. Members, I urge the Government to consider supporting the Local Electricity Bill and, if need be, work on a cross-party basis to improve the Bill and get it to a place where everybody is happy with it.
I congratulate the hon. Member for Bath (Wera Hobhouse) on obtaining the debate this afternoon and on putting forward the case for local energy, particularly for a community energy Bill, in such a succinct and complete way. That means I do not have to say all the things that I was going to say about a local community energy Bill, other than to say that we on the Opposition Benches thoroughly support such a Bill. We think it would make a tremendous difference to the way that local energy can move forward.
At its heart, it has a simple proposition, which is that people should be able to sell the energy they produce to their neighbours, their friends, the people down the road, their local industry and shops. As we can envisage, that sort of environment would not only make a tremendous change in how people relate to their own energy, but would potentially be a great step forward in the appreciation of what we need to do, as far as energy is concerned, in the low carbon environment we will have in the future. Energy is something that people do, rather than something they simply receive. That seems to be the essence behind the idea that people can sell the energy they produce to their local community.
It is a simple proposition and we know what a difference it would make, so why not just do it tomorrow? What are the barriers in the face of the proposal? To go to the point made by the hon. Member for Waveney (Peter Aldous), we seem to have been here on a number of occasions. He has a similarly long pedigree in talking about the same issues that I have raised, both on the Environmental Audit Committee and elsewhere. He is right that we seem to turn up in the House talking about this issue on a fairly regular basis, and nothing whatsoever changes.
My particular involvement in the issue goes back to a 2013 Energy and Climate Change Committee inquiry on local energy, which I chaired, that looked at the barriers to how local energy can go forward, remarked that there was not a great deal of local energy going on and talked about the potential for local energy. We have heard this afternoon about the potential from now on, but at the time we were saying we could have perhaps 3 GW of local energy overall in this country by 2020. What have we got today? About 270 MW, something like that.
If we look at the various projects have contributed to that 278 MW, we have heard mention of a number of the co-operatives and organisations that have actually produced local energy, but pretty much to a project—I have seen a lot of projects in my time—they have been carried out with heroic dedication, overcoming tremendous obstacles and, in some instances, have failed at great cost to themselves and other people. It would be so easy just to make it possible for those schemes to happen. I congratulate and commend all those people who have generated the 278 MW of local energy that we have so far. The fact that we have any at all is a remarkable tribute to them, not to the system we have.
That is where we need to be very clear. The obstacles in the way of local energy are very much about the question of local supply, but there are a lot of other obstacles as well, which hon. Members have mentioned this afternoon. The idea is that people are trying to set up a local scheme to produce a pretty modest amount of energy for local consumption, important though all those local schemes are in terms of aggregation across the country. However, people have many obstacles to overcome and are required by the planning system to get permission in place. They need to spend perhaps a million pounds per project just to get a modest scheme going. If the rules were different, people would be able to put that million pounds into the development of the project and not throw it away on a possibly unsuccessful scheme in the first instance.
The hon. Member for North Devon (Selaine Saxby) gave the example of the local brewery getting its cars on the road. People might think that is a fanciful example, but it is absolutely how the grid system works at the moment. There is an assumption that every single electron that is produced goes literally from Land’s End to John O’Groats and back again before going into a lightbulb and that it is charged as such, even if it had come from two doors down the road. That is the assumption. The introduction of local energy into the system is often regarded as a tremendous nuisance and loss of load. We cannot actually see where it is, and it is not easy to balance in the grid. That means that the last to get connections into the distributing grid are the local energy schemes. The charging regime for those schemes, once in operation, assumes that they are national schemes, just locally based.
I listened very carefully to the hon. Gentleman’s explanations about the complexities of the grid. Does he agree that, when thinking about licensing for a new devolved scheme, we need to look at things such as liabilities when there are outages, for example? It is not impossible to overcome these difficulties.
The hon. Member is absolutely right. It is not particularly difficult to overcome these problems. I am emphasising this deep mindset of how the grid works that has been with us for a long time. The hon. Members for Strangford (Jim Shannon) and for Kilmarnock and Loudoun (Alan Brown) mentioned the fact that the grid was designed for a bunch of providers to produce x amount of energy, which would go through the grid until it got to a lightbulb. The world is completely different these days, but the grid still operates as if that were the case. That is inimical to the success of local energy projects.
As the hon. Member for Bath says, it would not be difficult to fix that, but there is a problem. Ofgem and, to some extent, the Department are particularly concerned that if we start dismantling the grid in its old system and localise it to enable the development of local energy in the way we have discussed, there could be distortions in that original system. I suspect the Minister will talk about some of those distortions, but let us be clear: they are distortions to an old system that does not work. We actually need those distortions to come into place to make the new, low-carbon overall renewable system work in the first instance. Making local energy work in that context is a very important change we need to make.
We need to make these changes to the system as a whole. We need to get the grid on to a much more friendly basis for local energy. We need to make the possibility of local energy much more real in terms of the hurdles it needs to overcome before it can get going. We need to have positive Government support for the development of expertise and the assistance and support that local energy schemes need to go ahead. That particular area, with the preponderance of volunteers in the local energy system, would be really good to have as a draw-down arrangement for local energy for the future.
Yet again we are meeting with the idea that the future for local energy could be really bright, but I fear that we will be here in a few months’ time talking about the bright future that has not quite emerged, but may in the future. We have not got time any more to keep going round the houses before we get to a decent settlement that will allow local energy to proceed. Local energy is so important, as we have heard this afternoon, for the future of low-carbon renewable energy.
I was delighted that the Local Electricity Bill has been amended to ensure that local energy is low carbon and renewable, so that we do not have diesel reciprocators coming in and providing local energy as a result of the ability to get a local licence. That is a very good amendment, and adds further to the Bill’s force.
I have questions for the Minister that are similar to the three questions asked by the hon. Member for Bath. I hope that he can give us some reassurances about the Government’s earnestness to bring about changes to the grid arrangements that can underpin local energy, and that they will be treated as a move forward as opposed to a distortion of the system. The answer to one of the questions posed by my right hon. Friend the Member for Leeds Central (Hilary Benn) about the German system is that cities in Germany, in many instances, own their own grids—and are doing so in increasing numbers. Germany does not have the grid system, a system that is regarded as just common sense in the UK. We have to turn that common sense around and start from the bottom up, with grid and district-grid management, rather than assuming that we should work from the top down. If we do that, then there will be a fundamental turning of the tide in favour of local energy for the future. I look forward to what the Minister has to say. I hope he will be fully supportive of the local community energy Bill, but I hope he will also be understanding of what differences need to be made to the system to allow local energy to come into its own.
Let me begin by congratulating the hon. Member for Bath (Wera Hobhouse) on securing this important debate, and for pre-submitting the three questions that I will answer during the course of my speech. I will, however, return to them at the end to make doubly sure that I have answered them to her satisfaction. I realise that this is the first debate on the topic since I took on my new role in September; I think the previous one was on 1 July. I welcome the debate, and it is fantastic to see so much enthusiasm for community energy from all parties, nations and regions of the UK—it is very heartening to see.
I will start by reassuring the House that the Government recognise the role community and locally owned renewable energy schemes can and do play in supporting the UK’s national net zero targets. Since the last debate we published, on 19 October the net zero strategy, which has already been referred to and sets out our road map of how we will get to net zero by 2050 and the staging posts in between. We understand that the value of community energy is not just in delivering energy projects that stimulate clean growth. Projects such as the community energy cafés run in south-east London support the most vulnerable in society by providing impartial domestic energy advice. Community groups can also act as the catalyst for raising awareness of both the energy system and wider environmental issues. They can be a catalyst in the promotion of behaviour change, which we all know is vital to reaching net zero.
I know Members will agree with me that there is already some excellent work under way in the community energy sector. We have heard many examples today, but I will add one: Swaffham Prior is an off-grid gas village of around 300 homes in east Cambridgeshire that is being supported by its community land trust to bring renewable energy to the village through installing a heat network. This will make it one of the first villages in the UK to do so.
I mentioned the net zero strategy, but we have also heard about a lot of different fantastic schemes from across the United Kingdom. As a Government, we fund the rural community energy fund. Delivered through local net zero hubs, this £10 million scheme supports rural communities in England to develop renewable energy projects that provide economic and social benefits to the community. Since its launch in 2019, the fund has received 1,668 enquiries, 203 applications and awarded millions of pounds worth of grants to projects focusing on a variety of technologies, including solar, wind, low-carbon heating and electric vehicle charging. It includes funding for the constituency of the hon. Member for Bath. She referred earlier to Bath and West Community Energy, which has received more than £92,000 from the rural community energy fund for feasibility grants to develop three community solar projects.
Ofgem also supports community energy projects and, following a consultation process, has announced that from February 2022 it plans to welcome applications from community-interest groups, co-operative societies and community-benefit societies to the industry voluntary redress scheme. That will allow groups to apply for funds to deliver energy-related projects that support energy consumers in vulnerable situations, support decarbonisation and will benefit people in England, Scotland and Wales.
More widely, through the introduction of UK-wide growth funding schemes, such as the community renewal fund, levelling-up fund and the towns fund—all very important new funds—the Government are enabling local areas to tackle net zero goals in ways that best suit their needs. I am aware that those schemes may be used to support the development of community energy schemes, which I highlight for all right hon. and hon. Members. For example, the towns fund has awarded more than £23.6 million to Glastonbury town, including to the Glastonbury clean energy project, which aims to generate renewable energy for use by many of the other projects in the plan, as well as other local businesses and residents.
To take forward the vital work on community energy, we committed in the net zero strategy to reintroduce the community energy contact group. That group will provide a single, dedicated forum for community energy groups to engage and co-operate with Government on key policy issues. That could obviously include discussion of the recommendations already referred to, made by the Environmental Audit Committee’s inquiry into community energy. I hope that group will strengthen outcomes for both the sector and the Government.
Turning to the Local Electricity Bill, which has been mentioned frequently in the debate, a right to local supply would allow electricity generators to sell their power directly to local consumers. As we know, the Local Electricity Bill seeks to establish that right by enabling electricity generators to become local suppliers, and to ensure that the costs and complexity of becoming a local energy supplier are proportionate.
Although the Government agree with the broad intentions of the Bill, we do not support the Bill as the means to enable local energy supply. However, I make a commitment today. I am about to write to my hon. Friend the Member for Wantage (David Johnston) to set up a meeting with him. I will leave it up to him which other Members he wishes to pull into that meeting to discuss the Bill and how we can work together, particularly on some of the obstacles to it.
I will take interventions shortly, but I want to lay out some of those obstacles. There is existing flexibility in how Ofgem regulates energy supply to allow for local suppliers. Ofgem has powers to award supply licences—a point raised by the right hon. Member for Leeds Central (Hilary Benn)—that are restricted to specified geographies and/or specified types of premises. However, many hon. Members have observed that, although the right to local supply exists, the costs of becoming a supplier act as a barrier to entering the market.
Making more substantial changes to the licensing framework to suit specific business models may create wider distortions elsewhere in the energy system. Artificially reducing network costs for local energy suppliers, as the Bill appears to imply, is likely to be distortive. It would mean higher costs falling on other consumers, which would increase as more local suppliers enter the market. It is important, therefore, that we take a broad view. I notice there is a Division in the main Chamber, Mr Betts.
Sitting suspended for a Division in the House.
Thank you, Mr Betts; let me carry on. It is important that we take a broad view of all consumers when making changes to the energy markets. That includes consumer protection measures, which form an important part of the supply licence. Suppliers play a key role in providing support to customers, particularly the vulnerable. For example, the energy company obligation requires suppliers to install energy efficiency measures in the homes of vulnerable people. The warm home discount applies a reduction to the bills of vulnerable households, and the price cap protects households from poor-value tariffs. The priority services register is used by suppliers to identify consumers who may need additional support with their energy supply. Of course, suppliers sometimes fail, but we have vital safety nets to ensure supply—as we have seen since the last debate—through the supplier of last resort, or SoLR, process. I would be concerned about the deliverability of such protections under a local electricity supply regime.
Let me turn to the three questions that the hon. Member for Bath asked specifically. I think that I have answered the question on future energy legislation. I have outlined, I think, some of the difficulties with the current Bill as proposed. Also, I think that I have gone into the distortions to the energy system just now and before in some detail. And will I meet her? As I have mentioned, I have an existing commitment to my hon. Friend the Member for Wantage, but I am happy for people to come together. That was the commitment that I made to him—to meet Members with an interest in this area.
I was originally a little disappointed that the Minister’s invitation went only to his colleague the hon. Member for Wantage (David Johnston), but if he has already fixed a meeting and he is opening it out, may I ask whether there is already a fixed date for it that he can share with us?
I appreciate the hon. Lady’s line of questioning. I replied specifically to a letter from my hon. Friend the Member for Wantage seeking a meeting. I think the best thing to do would be for me to speak to my hon. Friend or for her to approach him—it would effectively be his meeting—to find the best way forward. I am keen to be as accommodating as possible to Members across the Chamber, but I responded to the letter that my hon. Friend the Member for Wantage sent me, which I think was on behalf of a group of Members. [Interruption.] In that case, I think the best thing to do would be for the hon. Member for Bath to approach, first, my hon. Friend the Member for Wantage.
On the question of the cost to consumers, though costs are reduced for the few in the scheme, that avoids market costs, which fall on those not in the local scheme. That often includes the fuel-poor, who cannot buy into such schemes.
Germany was mentioned many times. Without going off and setting up my own separate Adjournment debate, there are reasons why Germany works well, and less well, in this space. Germany’s grid, for example, makes it very difficult to get renewable energy from the North sea down to Bavaria. Its grid is not set up in the same way that ours is, on a national basis. That can have advantages and disadvantages. I also point out Germany’s reliance on imported gas from abroad. That again stresses some of the difficulties in scaling up; even in Germany, which has been praised for community energy, it does not necessarily offer a scalable solution in that same way.
The hon. Member for Brighton, Pavilion (Caroline Lucas) asked about the continuing expansion of the rural community energy fund. I will look at the options for funding as part of Department-wide planning.
My hon. Friend the Member for Waveney (Peter Aldous) asked five questions; I will try to deal with them as quickly as possible. First, derogation is possible; Ofgem consulted previously on widening the use and geographic premises licences are possible. Secondly, the right to supply is possible; BEIS will work with Ofgem on retail market reform. Thirdly, this is really a matter for Ofgem, which can do a local supply licence, but we can set out why we do not agree with a local supply licence. Fourthly, we are looking at the supply hub model as part of the retail market reform. It is a complex issue, which, of course, has implications for things such as the smart meter roll-out, and so on. Fifthly, I think we have already covered the smart export guarantee scheme.
The hon. Member for Strangford (Jim Shannon) asked about Northern Ireland. As he and I well know, it is a unique energy market. I am having a meeting with Gordon Lyons, the Northern Ireland Economy Minister, on wider issues tomorrow, and I will try to feed this into a conversation with him. The meeting is with the three devolved Administrations, but I will find an appropriate time to ask him about how we can work together on community energy schemes.
Mr Betts, I think you said we were finishing at four—
Fantastic. I will leave some time for the hon. Member for Bath to reply.
Finally, earlier this year, we jointly published with Ofgem our new smart systems and flexibility plan and the UK’s first energy digitisation strategy, which was also developed with Innovate UK. Many of the actions set out in those documents aim to improve locational signals and help to enable smart local energy solutions, such as facilitating further growth of local flexibility markets.
In addition, Ofgem’s access and forward-looking charging review seeks to deliver more efficient choices about where users locate on the networks, and how they use the networks on an ongoing basis. The introduction of better price signals is important in ensuring that local generation is rewarded for the benefits it can bring to the system. It is recognised that, in some parts of the country, the costs of connecting to the grid can itself act as a barrier. Ofgem has therefore proposed to reduce connection costs for generation connections, such as community energy, by socialising more of the network reinforcement element of connection charges. Any changes are expected to come into effect from April 2023.
Many Members have argued in favour of local energy suppliers as an option to mitigate global gas price impacts, which I have already referred to, but risks would continue to exist. For example, local energy suppliers are likely still to need to be connected to the grid during periods of low generation. The failure of a local energy supplier without a grid connection would also leave customers without energy supply in the absence of an effective safety net.
The Government continue to support the development of new business models to supply energy consumers and help achieve our net-zero ambitions. In response to the unprecedented rise in energy prices this year, we are working closely with Ofgem to consider broader reforms to the overall energy retail market regulatory framework. We want a market that will support the longer-term transition to net zero, recognising the need for continued competition and innovation while also ensuring that suppliers have sustainable and resilient business models. That includes Ofgem exploring a move towards a more prudential regulatory regime, recognising that energy suppliers are managing complex financial risks and ensuring that the energy sector is resilient against a wide range of future scenarios, including prices rising further or falling sharply.
This debate is testament to the fact that there is clearly extensive cross-party support for the community energy sector, which we very much welcome. Just as importantly, there is a wealth of innovative schemes—
I am most grateful to the Minister for setting out so clearly the obstacles that need to be overcome to mobilise community energy schemes. Can he confirm that he and the Government are committed to overcoming those obstacles and removing those barriers so that, when we come back in a few months’ time, we can say that we have achieved tangible progress?
I am certainly committed to examining the obstacles and speaking to my hon. Friend; I know his long-standing interest in this, as indeed in all energy questions—he is the Mr Energy of East Anglia. I am very happy to continue to engage with hon. Members, to look at the obstacles and to see what can be overcome, ameliorated or worked around. I am very keen to meet and continue the engagement with hon. Members. It is a little difficult for me to agree to remove the obstacles until we have scoped them out. The Department is well aware of the obstacles, but if my hon. Friend has suggestions for how to overcome some of them, I am interested in working with him and like-minded hon. Members.
Just as importantly, there is a wealth of innovative schemes across the country, run by passionate people who are committed to creating a cleaner and greener future for us all. I close by thanking the hon. Member for Bath once again for securing the debate.
I thank all right hon. and hon. Members for contributing to the debate. It shows the Government that there is cross-party, cross-region and cross-nation support for the Local Electricity Bill and for overcoming the obstacles in the electricity market and the barriers to local electricity supply.
I thank the Minister for offering to meet us and have that engagement. I am a little disappointed that he has still not quite understood what we all think: that the current system does not work because it is too centralised, and that the Government must face the brave new world of decentralisation to set free the power of local electricity. As we have heard, community energy schemes currently account for 0.5% of the UK’s electricity supply; 20 times that would bring 10% of the energy market to the table —clean, renewable energy. We have heard today that the most important thing is that we fire on all cylinders, and it is surprising that the Government do not take up that opportunity for that extra 10% of local electricity supply—setting free people and power. I hope that we will receive a more positive reply when we come back to debate this topic, yet again, in this Chamber or the main Chamber.
Question put and agreed to.
That this House has considered the matter of empowering community energy schemes.
Offshore Renewables Wind Sector
I beg to move,
That this House has considered securing employment and community benefit in the offshore renewables wind sector.
It is pleasure to serve under your chairmanship, Mr Betts. Today is St Andrew’s day, Scotland’s national day, when Scots at home and abroad celebrate their native land. There should be much to celebrate, as our nation has been blessed with natural bounty. Sadly, that bounty has not always been used for the benefit of the Scottish people. Decades ago, oil and gas were discovered off Scotland’s shores, as they were, across the North sea, off Norway’s. However, although Norway now possesses, from the proceeds, a fund for future generations that the world rightly envies, Scotland has seen its assets stripped and child poverty soar. Areas that should have been revitalised were instead deindustrialised. Nature’s bounty, which should have provided for all, was taken by the few, and what should have transformed our nation was squandered by Thatcher on smashing the unions and by Blair on waging illegal wars.
However, nature’s good fortune has seen another bounty come Scotland’s way, and once again the country has been blessed. For long, our geography was an impediment, seeing us distant from markets and facing additional costs, and our climate was a bind or even a danger, as last weekend’s winds displayed. However, our geography and climate are now also a natural bounty and blessing, offering opportunities and advantages held by few others. Onshore wind is well-established, wave and tidal energy are being developed, and offshore wind offers huge potential.
The Prime Minister has stated that he wants the UK to become the “Saudi Arabia of wind”. Indeed, the wind blows around the shores of the British Isles, as elsewhere, but Scotland has 25% of Europe’s—not just the UK’s—offshore wind potential, and it is off Scotland’s shores that the real boon is located. Where is the benefit for our country and communities? Where are the onshore jobs that should follow in its wake? Where are the industries that should be lured to locate and invest here? Moreover, where are the benefits for communities where the turbines can be seen from, are serviced by or where the energy comes ashore? What will accrue to them?
In many ways, East Lothian is a microcosm of Scotland in regard to this energy bounty. The Seagreen field is coming ashore at Cockenzie, as well as Neart na Gaoithe at Thorntonloch and Berwick Bank at Branxton, near Torness. These are not one or two turbines, or dozens, but hundreds. It is not only the numbers, but their size that is hugely impressive. These offshore turbines are almost 50% bigger than those sited onshore that people currently recognise. The power generated by them is massive too. It is claimed that Berwick Bank alone will boost Scotland’s renewable energy capacity by almost 30%. Such is its scale that Berwick Bank alone will be capable of powering 5 million homes. That is just under the population of Scotland, but more than double the number of Scottish households.
For Scotland is blessed with a surfeit of energy, as it had and indeed still has with oil and gas. It is capable of providing for all our own needs, but also providing for others beyond our borders. That is not just south of the border, but beyond the shores of these islands as it is a global energy market now. Having lost out on its oil and gas bounty, Scotland must not lose out on its offshore wind. Fool me once, shame on you; fool me twice, shame on me. It is why there must be action.
Scotland and its communities must benefit. Jobs must be created in providing for offshore wind generation. Work and industries must spring from being the point where the energy lands and where energy costs should be cheaper, and where it should be logical and economical to base a business. Communities that will face some disruption from the siting of the turbines offshore or the construction of transmission stations onshore must see tangible benefits from the wealth that will flow through them.
Sadly, that has not been happening, which is why the debate is required and the issues must be urgently addressed. I accept that not all responsibility or culpability rests with the Minister or his Government—although much does; I accept that the devolution landscape sees energy reserved, but planning devolved. Similar divides apply to industrial and fiscal policy. Accordingly, I do not exculpate the Scottish Government, who have failed to use their powers or demand the powers that are necessary. Their failure to deliver manufacturing jobs at BiFab or Arnish is shameful, but many more levers rest with the UK Government, which is why they too must act.
East Lothian may not have the yards, but Fife and almost every major Scottish estuary most certainly has. Scottish yards should be booming, building the turbines that are required. Some were shipyards, others came along through oil and gas installations, but all of them exist and others could be established. The skilled workforce is there, and it is crying out for this work and these jobs. The orders should be going to these yards, although I accept that such is the number of turbines required that not all of them could be constructed in Scotland. But as it is, only a few are being built in Scotland and most will be built south of the border in England, or abroad. That is simply not acceptable.
The UK Government are funding offshore wind manufacturing in Teesside and on the Humber. Around 1,000 people are employed at Siemens in Hull, and 750 people are employed at GE Renewable Energy on Teesside, with even more people indirectly employed in other jobs. They are providing for the Dogger Bank wind farm and other developments off the coast of north-east England. Good on them, I say, but where is the money for our yards and where are the jobs for the wind farms off our coasts? Levelling up seems to stop at the border.
Moreover, as the energy comes ashore, how will Scotland benefit? At the moment, there is cabling work going on at Branxton and in East Lothian. A cable is being constructed to take the energy directly from East Lothian to Redcar, in the north-east of England. A similar cable south is planned for energy coming ashore further north in Scotland from offshore wind farms located further north in the North sea. It is one thing sharing a bounty with others; it is quite another to be exploited and to see our natural resource being taken, with little benefit accruing to our land or our communities.
As well as the turbine manufacturing jobs, where is the onshore industry that should be springing up from being near to where clean and cheap energy is landing? Such industry will not locate in Scotland if the energy is just being cabled south, yet that seems to be what is planned.
Also, where is the benefit for the communities? One place in Scotland that did benefit from oil was Shetland. There, the council negotiated a small payment from the companies landing the oil at Sullom Voe. That impeded neither exploration nor extraction, having been set at a modest rate, which was a boon for communities without being a burden for developers. As a result, Shetland has facilities—such as schools and sports centres in small communities, and bus and ferry services—that larger and urban communities in Scotland can only look at and envy.
At present, onshore wind turbines attract community benefit from developments. Even a single turbine or just a few turbines onshore can see individuals and communities benefiting. But as it was no doubt never imagined that turbines would be sited offshore, no such system exists for offshore turbines. Why not? Surely communities are as entitled to benefit from those turbines that are off their shores as they are from those located on their land.
I know that communities on both sides of the border have entered into arrangements with developers, but two aspects remain outstanding and they must be addressed. First, community benefits should apply whether turbines are onshore or offshore; requiring such payments to be made to communities should be statutory and not made through guidance, or simply being voluntary or discretionary for the operator.
Secondly, the rate to be paid should also be set nationally and the money should be paid to the local council or community. It should be for them to decide where and on what they wish to spend their money; they should not be handouts from a developer, subject to the developer’s whim or fancy. Shetland shows that it can be done, and the benefit for Shetland’s communities shows why it must be done.
In summary, I seek to ensure that Scotland benefits from the renewables revolution off its shores, as it failed to do with the discovery of oil and gas. The North sea bounty must come to Scotland this time. First, what steps will the Minister take to ensure that funds are available to develop turbine manufacturing in Scotland, and to ensure that contracts for fields off Scotland’s shores go to local yards, as is happening in north-east England?
Secondly, what will the Minister do to ensure that Scotland benefits from job creation where the energy comes ashore, and not simply see the energy cabled south and the benefit enjoyed elsewhere?
Thirdly, what will be done to end the discrimination against Scottish sites caused by the absurd contracts for difference pricing regime that prejudices Scotland and will be referred to by my hon. Friend the Member for Kirkcaldy and Cowdenbeath (Neale Hanvey) in his comments?
Finally, will the Minister meet me to discuss how communities, whether in Scotland or elsewhere in the UK, can benefit from offshore wind as they do onshore wind through a regulated regime, and a set fiscal regime that will benefit those communities? This is a huge opportunity for Scotland. Our nation lost out on the benefits from its oil and gas; it must not lose out on this renewable windfall.
I think, Mr Betts, that as they have given us quite a bit of time, I am happy to let the Member speak.
It is a pleasure to serve under your chairmanship, Mr Betts. I would like to thank and congratulate my hon. Friend the Member for East Lothian (Kenny MacAskill) on securing this important debate. On St Andrew’s day, it serves as a poignant opportunity to consider how right can prevail over might. Might and power can be used to silence and incarcerate, such as in the case of Craig Murray in Scotland, who tastes freedom once again this St Andrew’s day.
However, power and control can also be utilised to either stymie or enable the potential of a people and of a nation. My Kirkcaldy and Cowdenbeath constituency has a proud history of industry and endeavour, from the world-renowned Adam Smith to the linoleum factories of Nairn, and the Francis, Seafield, Kelty, Benarty and Cowdenbeath pits, to name just a few. Our folk do not fear work; indeed, they relish it.
In my youth, our folk worked doon the pits, on the ships, in the shipyards and on the docks of Methil, Burntisland and Rosyth, building rigs, servicing the naval fleet and working offshore. It was great industry, but this was crumbs from the table. From the Thatcher and Major Governments who put profit and privatisation before people at every turn, who put tax cuts for the wealthy before the financial security of a people, to the Blairite disaster capitalist adventure of illegal war-making in the middle east, and moving the Scottish maritime boundary, making 6,000 square miles of Scotland’s waters English.
I often hear Members from the Government Benches, and indeed Government Ministers, crow about our how our campaign for Scottish independence is a grievance. Well, they are right, and it is a fully justified grievance. All the evidence needed exists in the UK Government’s own archive, in the shape of the McCrone report that Scottish economist Gavin McCrone presented to the Heath Government in 1975, which revealed how North sea oil would make an independent Scotland as prosperous as Switzerland.
The facts show that Scotland has been robbed of the embarrassment of riches that North sea oil and gas could have provided to her people. We just have to look to Norway to see that reality. Why should the Scottish people believe a single word that any Westminster Government utter when history provides every bit of evidence necessary to demonstrate how easily false promises and vows can be discarded and broken?
Instead, we have escalating child poverty; a pernicious and vicious welfare state; and threats to the little control we do possess through Trojan horse policies such as the United Kingdom Internal Market Act 2020. None of this is helped by a supine devolved Government who seem to have given up on even talking a good game. The people of Scotland deserve so much better than this.
Just off the Fife shore, a green industrial revolution is taking place, but all that my constituents can do is observe. It has delivered no meaningful employment to our communities, and the only announcement to date from this Government was more crumbs from the table in the shape of offshore jobs for service engineers. That lack of ambition is sadly reflected back from organisations such as Renewables Scotland, which claims that Scotland has missed the chance to lead the charge on renewables and can only hope for domestic service engineer jobs. This is scandalous. Scotland is being plundered yet again, while our people suffer real harm as a consequence of the acts and omissions of their supposed Governments.
Scotland is replete with natural resources that, with focus and investment, could lay the foundations for national prosperity, as the transition towards a greener, more sustainable future gathers pace. Fife’s skilled workforce, proximity to offshore development sites and established fabrication facilities mean that the kingdom is perfectly placed on the Forth estuary to be at the forefront of the marine and green energy revolution. Harnessing the established and potential assets on all shores of the firth of Forth is key to enabling Scotland to end its dependency on fossil fuels and establishing a thriving, green energy-based economy.
In the context of the climate emergency, there is growing evidence that political, public and corporate priorities are beginning to align. Thus, a compelling case now exists for Scotland to further its ambitions towards a prosperous, zero-carbon economy. For this to be truly realised, any such prosperity must seek to build tangible local results, such as high-quality employment, world-leading research and development, and a national prosperity fund. We must not allow the Scottish people to be denied the benefits of an energy boom by remote or disengaged Governments again.
My constituency has the potential and is bursting with ambition. Brexit has neutralised the excuse of state aid, but there has been no change to contracts for difference and no conditionality on local employment or supply chains. Transmission costs are driving investment away, so there is a need to rapidly consider viable alternatives, such as microgrids, which generate and deliver energy locally, creating jobs and driving community prosperity.
In the green energy revolution, Scotland is again well positioned to benefit and lead the charge. With less than 1% of Europe’s population, Scotland possesses 33% of Europe’s carbon storage potential, 25% of Europe’s offshore wind resources, 25% of Europe’s tidal energy resources and 10% of Europe’s wave energy potential, but yet again it is Westminster that stands in our way.
Scotland’s oil and gas sector has been unbelievably badly managed by successive UK Governments and we cannot allow this opportunity to be squandered by yet more Westminster Governments that see Scotland’s wealth as something to be exploited, rather than stewarded and safeguarded for future generations. Only by taking full control of our future will the renewable sector reach its full potential, so our people can lift their gaze and realise their full potential.
I am concluding now and I have fewer than 50 words to say.
I do not expect a particularly constructive or useful response from the Government, but that is okay because any indifference, dismissal or vague commitment serves only to strengthen the argument in favour of independence as a route to prosperity. Scotland’s natural wealth will be one of the key foundations of our future prosperity as an independent nation. There is much work to do but opportunities galore for Scotland, for Fife, and for Kirkcaldy and Cowdenbeath.
I begin by congratulating the hon. Member for East Lothian (Kenny MacAskill) on securing this important debate.
We know that renewable electricity generation is essential to the decarbonisation of the power sector and the UK’s efforts to reduce greenhouse gas emissions and reach net zero, which was recently discussed in Scotland at COP26 in Glasgow, which I was delighted to attend on behalf of the UK Government. Offshore wind will be a vitally important tool in creating the low-cost, net zero energy system of the future.
We can be enormously proud that the UK offshore wind industry has already made great strides, in terms of both the production of major turbine components and their deployment, moving from installing about one turbine every week to about one every single day. Turbine sizes have grown by 700%, from 2 MW to 15 MW. Alongside this, the costs of offshore wind have fallen dramatically since 2015. The first contract for difference allocation round cleared at around £114 per megawatt-hour. In the last round, in 2019, that fell to less than £40 per megawatt-hour. That is a reduction of around two thirds to 70% in the cost of offshore wind. It has been a resounding success, and we expect both the increasing scale of turbines and cost reduction to continue.
I agree with the hon. Member for East Lothian that it is absolutely right that local communities should benefit economically from major new manufacturing infrastructure projects. We want to see thousands of people all over the country working in new green, high-quality jobs in our renewables sector. Therefore, the Government are investing heavily to support the offshore wind sector, from innovation to the manufacture of major wind turbine components, all the way through to the deployment and connection to the grid.
Let me deal with a few of the points raised. I will first stress that these decisions taken by the UK Government have brought huge benefits. When I was at the Treasury in 2015, a lot of the decision making behind contracts for difference was controversial. Working with the Department for Business, Innovation and Skills, as it then was, we thought that the CfD regime would lead to a big boost in the UK’s renewable energy and, by scaling up, would reduce costs, both of the energy produced and that of building the infrastructure. We turned out to be right on that.
There was also investment brought in by the UK Government. When I was at the Department for International Trade, for four or five years, I was going around getting investment into the UK offshore wind sector, particularly from European countries, such as Spain and Denmark, and companies looking to invest in this country. A key part of that has been to ensure that the supply chain also benefits the United Kingdom overall, including Scotland. About 60% or more of the supply chain is based in the UK. A lot of the key decisions have been the right ones taken by the UK Government.
The hon. Member for East Lothian raised a point about Wick harbour. We have seen that harbour revitalised by the development of the Beatrice offshore wind project. As more projects are developed north of the border, we expect similar benefits to be realised for other harbours. We heard from the hon. Member for Kirkcaldy and Cowdenbeath (Neale Hanvey), who provided a long history—a tour de force—that started with Ted Heath, moved through Margaret Thatcher and John Major, and ended with him describing the Scottish Government as a “supine devolved Government”. The hon. Gentleman mentioned the word “grievance” and said it was not one, but I think he is lumping grievance on to grievance. His latest grievance is with the Scottish Government, not just that of the UK.
Offshore wind has a central role in the Government’s decarbonisation and levelling-up ambitions. Developing the economic benefits that the UK derives from offshore wind took prime position in the Prime Minister’s 10-point plan for a green industrial revolution, published this time last year. The 10-point plan also includes a target to deploy 1 GW of floating wind in the UK by 2030, as a stepping-stone to further growth through the 2030s and beyond.
The hon. Gentleman for East Lothian mentioned the potential of the sector, but it is not just the potential; it is the reality. The UK has the world’s largest installed offshore wind capacity—we are No. 1. As the Prime Minister says, we are the Saudi Arabia of wind. It is not just potential but a realised thing that is happening every day. We are not content with just 10 GW; we have a commitment to quadruple that over the next decade, to 40 GW. Scotland will play a massive role in that commitment.
Last month the Prime Minister announced up to £160 million in new funding to support the development of large-scale floating offshore wind ports and factories all over the UK. That follows on from the success of the offshore wind manufacturing investment support scheme, which has so far this year enabled the announcement of two major port hubs, and six offshore wind manufacturing investments, representing £1.5 billion in public and private sector investment, and set to support up to 3,600 jobs in deprived areas of the UK by 2030.
Scotland, as we know, has a very rich industrial heritage, and I am confident that the skills already present in Scotland, proven over the decades in the oil and gas sector, will be transferred into a world-leading capability in manufacturing for the offshore wind sector— a key part of our North sea transition deal. Yesterday I chaired the North Sea Transition Forum with the industry, Oil & Gas UK, the Oil and Gas Authority and the Scottish Government.
The point is that to make that transition means recognising the fantastic skillset. One of my first visits in this role was to Aberdeen, where I saw that skillset at first hand, working with a lot of the incredible universities—I visited Robert Gordon University, for example, whose transition unit is working on how we transfer the skills that have been vital for the UK as a whole and Scotland in particular for the past 50 years over to sectors such as offshore wind. The answer is that there is a lot of overlap between offshore hydrocarbons and offshore wind, but making that transition is a key part, and there are many people helping to deliver that.
That is why the North sea transition deal announced in March contains key commitments on skills, including a commitment from the oil and gas sector to develop an integrated people and skills plan by March 2022, to support the sector’s transition and diversification. Both Government and the sector have also committed to supporting the work of the Energy Skills Alliance. Its work will address, among other things, future skills demands of new energy sectors, all-energy training and standards and all-energy apprenticeships.
In particular, Scotland could benefit greatly from nascent technologies on the horizon. I mention floating offshore wind again, but just last week we announced a £20 million ring-fenced contract for difference fund for tidal. There is huge potential for Scotland to take advantage of its excellent geography. The same extends to parts of Wales and the Isle of Wight and other particular parts of the UK that have excellent tidal resources. We announced a ring-fenced pot within the next CfD auction for tidal energy.
I do not think I have time—I am afraid I only have one minute, and the hon. Gentleman got a pretty fair crack of the whip earlier, to be frank.
Floating offshore wind is an area that has already inspired huge interest from developers in Scotland—hardly surprising, given the rich deep-water resource and manufacturing capability in Scotland. It is no coincidence that the world’s two largest floating offshore wind arrays, Hywind and Kincardine, have been developed in Scottish waters. The Celtic sea is also a major development opportunity.
Decisions on how specific projects can deliver local benefits are generally a matter for developers—a point raised by the hon. Member for East Lothian. However, we want developers and operators to provide community benefits consistent with relevant guidance and good practice principles, building on experience in other renewables sectors.
This debate is testament to the strong cross-party agreement that we want to leverage the UK’s world-leading offshore wind sector, to maximise the economic benefits enjoyed by our coastal communities across the UK, including in Scotland. I close by thanking the hon. Gentleman again for securing this enlightening and important debate.
Motion lapsed (Standing Order No. 10(6)).
Climate Goals: Wellbeing Economy
[Relevant document: e-petition 580646, Shift to a Wellbeing Economy: put the health of people and planet first.]
I remind hon. Members of the guidance from the Commission and the Government about wearing face masks when they are not speaking, giving space to other Members and staff, and testing twice weekly with lateral flow tests, either on the estate or at home.
I beg to move,
That this House has considered a wellbeing economy approach to meeting climate goals.
It is a pleasure to serve under your chairing, Mr Betts. I am grateful for the opportunity to debate why the Government should embrace a wellbeing economy if they are serious about meeting their climate goals. Beyond the climate emergency, there are many other reasons to move beyond our current extractive, exploitative and growth-addicted economic system: tackling inequality, stopping the destruction of the natural world and preventing future pandemics, to name just three.
Crucially, the discussions in and around the COP26 summit remind us that those issues cannot be separated and siloed. If we keep decimating the natural world, we will not meet climate goals. If we do not put equality and justice at the heart of climate action, we will not make the shift to a greener and fairer economy. Pandemics, meanwhile, in the words of some of the world’s leading scientists, are
“a direct consequence of human activity—particularly our global financial and economic systems, based on a limited paradigm that prizes economic growth at any cost.”
Many colleagues will be well versed in why GDP growth has always been a terrible measure of a nation’s economic progress—I will not go into the detail now. However, it cannot be overestimated how critical shifting from growth to wellbeing is from a social and equity perspective. As a report by leading economists for the OECD finds, patterns of economic growth have generated significant harm over recent decades. That includes rising inequality, not just catastrophic environmental degradation—which itself hits the most vulnerable the hardest.
I want to focus on the climate imperative of transforming our economic system, and on the wellbeing economy as a specific, practical and positive alternative to economics as usual. I will start by mentioning a recent parliamentary petition that called on the Government to shift to a wellbeing economy and put the health of people and planet first. It has been linked to this debate on today’s Order Paper; I want to thank the many thousands of people who supported that petition. It was started by a young Brighton constituent, Skylar Sharples, and it begins like this:
“We urgently need the Government to prioritise the health and wellbeing of people and planet, by pursuing a Wellbeing Economy approach. To deliver a sustainable and equitable recovery, the Treasury should target social and environmental goals, rather than fixating on short-term profit and growth…Two thirds of the public want the Treasury to put wellbeing above growth. Scotland and Wales are already part of the Wellbeing Economy Governments alliance. As host of the COP26 climate summit, the UK Government should build and champion a Wellbeing Economy—at home and globally.”
That petition did tremendously well to get almost 70,000 signatures. Even though it was not enough to secure a debate via the Petitions Committee, I am very grateful that through the ballot process we were able to hold today’s debate.
In turning to the climate imperative for switching from growth to wellbeing as the purpose of our economy, I will start with the science. If we take the global climate goal of reaching net zero by 2050—leaving aside the injustice and inadequacy of that as the UK’s goal—economic growth is still the elephant in the room. During that same 30-year period, between now and 2050, the global economy is set to nearly triple in size. That means three times more production and consumption than we already have each year. It is enough of a challenge to decarbonise an economy the size of the current one in such a short time span; it will be virtually impossible to do it three times over. If we carry on with growth as usual, then halving emissions by 2030 would require that rich countries like the UK decarbonise their economies at a rate of more than 12% per year. That is more than five times faster than the historic rate of decarbonisation, and about three times faster than what scientists project is possible, even under highly optimistic conditions. The most “successful” rich countries are decarbonising at only around 3.4% a year; the performance of average rich countries is much worse. The gap is huge, and however heroic one’s assumptions are about the potential for decoupling growth from carbon emissions—an argument that I am sure we will hear from the Minister—there is no evidence that there can be absolute decoupling in anything like a fast enough timeframe.
The bottom line is that the GDP figures that we are using to measure economic success are also measuring the rate at which we are barrelling towards climate catastrophe. It is little wonder that the voices around us are saying that we need to end our addiction to GDP growth to tackle the climate emergency. Those voices—from climate scientists and environmentalists to economists, health professionals and business leaders—are becoming louder. I want to give two examples.
There was a recent joint report from the Intergovern-mental Panel on Climate Change and the Intergovernmental Science-Policy Platform on Biodiversity and Ecosystem Services—an intergovernmental body that assesses biodiversity. The report calls for
“a profound collective shift of individual and shared values concerning nature—such as moving away from the conception of economic progress based solely on GDP growth, to one that balances human development with multiple values of nature for a good quality of life, while not overshooting biophysical and social limits.”
That is pretty clear, and it is coming from the world’s most respected scientists.
To take one example from the business world, former Unilever CEO, Paul Polman, recently wrote about the World Economic Forum’s 2021 global risks report, in which four of the top five risks to our economies are coming from the environment—including climate change and biodiversity loss. He said that
“the estimated $300 billion annual cost of natural disasters caused by ecosystem disruption and climate change”
“the risks of unbridled economic growth. Thinking beyond GDP and short-term profit is therefore essential in order to restore our relationship with the planet and transform our system into a viable one.”
So, wellbeing within planetary limits, not infinite GDP growth, is the new economic goal we urgently need. If the boss of a massive multinational can get that, I have to ask why can’t Treasury, especially when its own Dasgupta review of “The Economics of Biodiversity” made the case so well, too. It reads,
“GDP does not account for the depreciation of assets, including the natural environment. As our primary measure of economic success, it therefore encourages us to pursue unsustainable economic growth and development.”
The Dasgupta review also calls for an
“urgent and transformative change in how we think, act and measure economic success to protect and enhance our prosperity and the natural world”.
Yet the Treasury response to that key recommendation does little more than refer to a review of GDP that was done six years ago. That is not “urgent and transformative change”.
I hope the Minister can convince us today that the Treasury is not as cavalier and complacent as it would appear. Will she confirm that the Government accept the need to adopt new measures of economic success beyond GDP to give climate, nature and collective wellbeing the priority they deserve? What work is taking place on that? It will not be good enough to say that the Office for National Statistics has developed natural capital and wellbeing indicators, because those indicators are not just out of date; they are clearly not being used in policy making, least of all inside the Treasury where GDP growth reigns supreme. It is a bit like claiming that you have adopted a healthy diet because you have some flaccid carrots in the fridge but meanwhile you are chomping down on a box of Mars bars. It does not wash.
Similarly, the inquiry by the Environmental Audit Committee, of which I am a member, into biodiversity and ecosystems concluded:
“Alternatives to GDP urgently need to be adopted as more appropriate ways to measure economic success, appraise investment projects and identify sustainable development.”
So will the Minister today accept that cross-party recommendation and set out a timeline for progress?
The wellbeing economy is not just a brilliant idea; it is already being implemented in the UK and around the world. At local, national and international level—beyond Westminster—the green shoots of a new economic paradigm fit for the age of climate emergency are already emerging. In the short time that I have, it is impossible to mention more than a fraction of the researchers, campaigners, practitioners and others who make up the movement for a new economy, designed to serve people and planet—from community wealth building to the Doughnut Economics Action Lab.
The wellbeing economy is one example. It is being taken forward by the Wellbeing Economy Governments partnership, a collaboration of, so far, five national and regional Governments. In Finland, the world’s youngest Prime Minister, Sanna Marin, heads up a Government who are outspoken on the principle that,
“Economic growth is never an end in itself and well-being is not just an item of expenditure for public finances”.
In Iceland, indicators for wellbeing guide Government decision making. Scotland has a national performance framework centred around wellbeing, and with Greens now in government we can expect even more leadership on the post-growth wellbeing economy. Wales has the first ever Well-being of Future Generations (Wales) Act, a version of which many of us have been championing in this House as well, and New Zealand is home to the world’s first ever wellbeing budget and a Finance Ministry that uses a living standards framework to shape all economic policy making.
Those nations are working together to share expertise and advance a shared ambition to build wellbeing economies. Will the UK join them? If the Minister cannot quite commit to that, will she at least commit to carrying out a major review of what the Wellbeing Economy Governments partnership is doing, and the benefits of the Treasury taking a similar approach, ideally in time for the next Budget to be the UK’s first wellbeing Budget? As a first step, the UK’s first wellbeing Budget could swap the focus on GDP and change it for GDWe, or gross domestic wellbeing, as developed by Carnegie UK. No one is saying that untangling our growth addiction is simple, but we can no longer delay. As the economist Kate Raworth puts it, we need to create
“economies that make us thrive, whether or not they grow”
rather than having economies that grow whether or not they make us thrive.
Drawing to a conclusion, I want to quickly share some views from members of the public on the topic of today’s debate. They were gathered via a survey over the weekend, thanks to the parliamentary digital engagement service. It has had more than 1,000 submissions and shows how severely our current economy is failing on the basics. Hazel, for example, wrote about what a wellbeing economy could prioritise. She suggests:
“Ensuring everyone’s basic needs are met, including any additional needs resulting from disability. Such needs include access to healthy food, safe, warm homes, and access to health care (both physical and mental). Nobody in the developed world should need to rely on food banks.”
“Aiming for constant financial growth cannot be sustained on a planet of finite resources…The health and well-being of our shared planet and all beings who reside here should be our priority. The way and extent to which we care for it and for each other should be key. Wastefulness should be seen as the loss that it truly is. Ecology and economics should not be at odds; the words both derive from the concept of looking after our home.”
The responses are another sign that, far from delivering on the famous “people’s priorities,” as the Government like to say, the Treasury is completely ignoring them by sticking to an outdated and dangerous fixation on economic growth. It is time for global Britain to become a global leader, fit for the age of climate emergency, rather than a laggard in a shift to a wellbeing economy. For the sake of climate justice today and for the lives of future generations, I look forward to the Minister’s response and to working with Members across the House to prove that another economy is not just possible; it is on its way.
I am delighted to be called to speak first after the hon. Member for Brighton, Pavilion (Caroline Lucas), who I thank for securing this debate on the most important issue. I genuinely cannot imagine two more important priorities for an independent Scotland than ensuring that we have action on climate change and that we put wellbeing at the front of everything we do.
We are lucky in Scotland that we are already on this road. We have begun to make the changes that are required to move away from focusing entirely on economic growth and toward looking at the wellbeing of our population. When we are looking at budgets, such as the national performance framework, as was mentioned, our decisions are looked at through a lens. Do they improve wellbeing? Do they reduce our negative impact on the planet? I think it is wonderful that we do that.
There are also good things happening in schools. Bairns throughout Scotland are aware of their rights under the UN convention on the rights of a child. It is taught throughout Scottish schools. I can speak to kids as young as five and ask them about their rights. It is important for people’s wellbeing that they are aware of their rights and are able to fight for the rights that they deserve. It is important that they are able to make their voices heard. The only way we are going to get to wellbeing is to ensure that everybody is empowered to get those rights.
There is absolutely no point in focusing on economic growth for economic growth’s sake. The UK economy has been growing, but inequality is still stretching. We have still seen an increase in inequality. People who are on the bottom of the pile continue to be on the bottom of the pile. We are not improving societal wellbeing if we are not ensuring that decisions benefit everybody, rather than those currently at the top of the pile. For all our constituents, we need to ensure not just growth, but fair growth. We must focus on reducing inequality—and focus on everything that the hon. Member for Brighton, Pavilion said—and on making sure that decisions, particularly budgetary decisions, are taken with the wellbeing of people in mind, not simply growing the money of this country’s richest people.
It is a pleasure to serve under your chairmanship today, Mr Betts. I thank the hon. Member for Brighton, Pavilion (Caroline Lucas) for securing this important debate. I very much agreed with her eloquent and detailed speech.
Members may remember that the renowned author Naomi Klein stated in 2011 in her paper “Capitalism vs the climate” that:
“Climate change is a message, one that is telling us that many of our culture’s most cherished ideas are no longer viable.”
Sadly, 10 years on from Naomi’s groundbreaking paper, not much has changed. We are now faced with more stark messages in the form of covid-19, the social care crisis, an energy crisis and a cost-of-living crisis. We simply do not have an economic system geared up to ensure that everyone flourishes. We see growth prioritised, but rarely do we ever question the real nature of such growth or what its adverse consequences could be. The OECD has stated:
“If ever there was a controversial icon from the statistics world, GDP is it. It measures income, but not equality, it measures growth, but not destruction, and it ignore values like social cohesion and the environment. Yet Governments, businesses and probably most people swear by it.”
Growth means nothing to many families struggling, living in cold, mould-infested homes, wondering if they are ever going to get a lucky break. It means nothing to the pensioners struggling to get the care they need, and it will mean nothing to our children if they have no future because the flawed and relentless pursuit of growth above everything else finally destroys our planet.
The good news is that with real economic and political will, we can develop a system of economic metrics that centres our economy around what should be the most important measure of success for any Government: wellbeing. As Katherine Trebeck from the Wellbeing Economy Alliance explains, that means recognising that
“The economy is a means to an end, not an end in itself. It is an economy which regenerates nature, an economy where collaboration trumps competition, an economy where activities and what organisations do is purposeful, not simply just to make money. In which individuals’ desire to be acknowledged for meaningful contributions with a decent living is not dominated by a motivation of acquiring wealth. And which is financed by a stable, fair and socially useful financial system that serves the real economy for the long term.”
I hope that today’s debate is just the start of a long overdue conversation about what that really means in practice: from finding a new way of measuring the economy’s performance away from the distribution-blind GDP and towards indices of wellbeing, through to ensuring the economy distributes wealth more fairly, provides stable and sufficient incomes, supports socially and environmentally useful enterprise and, importantly, ensures the ownership of economic assets is shared more widely and democratically with workers and communities.
Ultimately, the Government are not a mere economic spectator here. They have the power to implement that change. As such, the debate goes to the very heart of what we think the sole purpose of Government is. Are they the caretaker of a broken economic theory that preserves wealth for the few, at the expense of the many, or are they the engine that drives the economy to deliver health and wellbeing for all? In Salford, we know the answer to that. We say the welfare of the people is the highest law.
It is a pleasure to serve under your chairmanship, Mr Betts. It is also a great pleasure to support the hon. Member for Brighton, Pavilion (Caroline Lucas). We were great colleagues in the European Parliament and, dare I say, the precursors to the co-operation that we are seeing in Scotland, where Green leadership is taking us to new vistas of co-operation.
The wellbeing economy is an idea whose time has come. We are measuring the wrong stuff. So much of what we see within the public debate about public services and public investment posits economic growth versus wellbeing or versus environmental standards or other measures of public good. It should not be either/or; we need to consider both. We are measuring the wrong stuff. That means that the criteria against which we measure outputs is leading us to perverse incentives.
The pandemic we are all, sadly, very much still living through—we cannot relax yet—is a disruptive event for a lot of people: not just everyone in this room, but all our constituents as well. People are considering how they live their lives, where they get their food, how they travel to work, where they work, what they do and how they spend their time. Questions of work and productivity are being examined in households up and down the length of these islands in ways they never have been before. GDP is a rubbish measure of any human happiness.
If we want to increase GDP, I will give two examples. A car crash is a fantastic way to increase GDP, because it involves garages, lawyers, insurance companies. It involves all sorts of things that are not economically productive, but do count from an GDP perspective as positive to the balance sheet. Divorce is also great for GDP: one house becomes two; lawyers make lots of money; and assets are split up. There are various economic things that count in the GDP ledger, but are surely not positive for us as a society.
It strikes me as self-evident that adding a wider set of criteria to the public sector consideration of expenditure can lead only to better outcomes. Likewise, I am very drawn to the Carnegie UK Trust’s idea of a gross domestic wellbeing index as a way to benchmark actual progress. About 300 years ago I proposed to the SNP conference that Scotland should adopt a Nordic-style wellbeing index to benchmark the progress of society against other comparable countries—and here we are 15 or so years later.
I close with one very concrete example, which shows that this is not an esoteric, niche subject but aimed at bringing about real change in the real world. Bus services in Stirling and the Forth valley are not fit for purpose. They are not up to scratch. They are not as reliable as they need to be. Bus services are not in my remit, as a Member of this Westminster Parliament, but I see that systemic change is necessary, because we are looking at the wrong outputs and outcomes. There is too little public funding available to support the bus network that we need. However, how many people have to have a car but would not have one if they could rely on buses? How much unproductive capital is tied up in those vehicles? Think about how many carbon emissions we could get rid of if the bus services were reliable. Think about the lost economic productivity of the people who cannot afford cars but cannot get to work either. If we change the metrics, we change the outcome.
As we have heard, the Scottish Government have started that work. The Scottish national performance framework brings in a wider set of criteria. There is the Wellbeing Economy Alliance with Iceland and other small countries. We are already doing this work, and we can do much more. That is not to say that the UK cannot do more too. I look forward to hearing from the Minister; she could have positive engagement and support if she actually took serious steps in this direction. Fair work must also be properly considered in this equation, and we must ensure that the new jobs are good jobs, fair jobs and well-paid jobs. If we grab this at the flow, there is a big prize that we can all share.
I thank the hon. Member for Brighton, Pavilion (Caroline Lucas) for securing this really important debate. The subject is close to my heart and to how I try to work as a political representative, both in Parliament and in my constituency. My firm belief is that we need to work for a society that is not driven by the quest for growth, profit and the enrichment of a few. Rather, we should work for a society where meeting human needs is paramount.
To turn theory into action, it is important that we, as public representatives, engage with and involve people we represent and take a bottom-up approach to change. Part of the process should involve holding open discussions with constituents, involving them and giving them a sense of ownership of the changes that can meet their needs and those of the community.
I will share some examples of action that I, alongside local people in my constituency, are taking to put these theories into practice. Earlier this year, I held a series of climate assemblies in Cynon Valley, resulting in a public document that we submitted to COP26. More recently, we received a report that I commissioned from the Bevan Foundation called “Cynon Valley after covid: action for recovery and renewal”. Over 120 people attended our climate assemblies, which covered green jobs, green transport and green energy. It was clear from those discussions that local people understand the need for change and have the appetite and many of the solutions to enable it to happen.
The green jobs debate, for instance, emphasised the need for training for future skills and the need to nurture local talent. People were also clear that any new green jobs should be secure and well-paid, and have good terms and conditions. A headline statement from the group was that
“cooperation and not competition must be the way forward”.
That leads me to a very brief overview of the “Cynon Valley after covid” document, which looks at the kind of society and economy that we feel we need in Cynon Valley. It is underpinned by a community wealth-building approach, which will help to stimulate local economic activity by reducing not only the leakage of money out of the area but, more importantly, the size of the profit extracted. That can help to build and spread wealth in the local population, which will assist in the process of prioritising and addressing the health and wellbeing needs of our local community. The report ends by recommending a green Cynon programme, with fair work, skills, action to stimulate new local businesses, including community-based enterprises, the retrofitting of energy-saving measures in all housing, and the development of wind and solar energy projects.
It is important that I share some of the socioeconomic background of my constituency of Cynon Valley. It is an old mining community with high levels of unemployment and some of the highest levels of poverty and ill health in Wales. The pandemic exemplified this in the high number of deaths from covid—the third highest in the whole UK—which is what drove me to do the research that I have just mentioned.
We have many dangerous coal tips, with the risks exacerbated by recent frequent heavy rain and flooding, which are a direct consequence of climate change. Increasingly, people are realising that we cannot improve the wellbeing of people without tackling climate change. Creating a society that meets the needs in my constituency will be challenging, but it is the very reason why I am so passionate about working alongside others to promote and develop a socioeconomic system that puts people and the future of our planet before profit.
My experience—from discussions with local people and agencies through to all my local activities—has shown me that, given the right approach and investment, it is possible to do things differently to meet the needs to ensure the future of the planet and the human needs of the people and communities we have been elected to represent. That is my vision for Cynon Valley, and it is shared by so many and is achievable. It is an urgent vision. If we are serious about ending poverty and inequality in our society and about ending the destruction of our planet and our natural environment, we must act now to turn theories into practice and campaign together for a different kind of society. Yes, we can do things differently.
I thank the hon. Member for Brighton, Pavilion (Caroline Lucas) for bringing forward this debate and for many years of leadership, giving vision in this area and a lot of practical direction. The necessity for change, and the failures of the economic model that we currently operate, are all around us: in climate and nature breakdown, in inequality within and between nations of the world and between generations, in the depletion of resources and the hoarding of wealth, and in the mental ill health and lack of fulfilment that are beginning to engulf our populations.
The hon. Member for Stirling (Alyn Smith) outlined some of the absurdities of GDP as our sole measurement, with all of the negative effects simply written off as “externalities”. It is very clear that a system that accounts for tobacco sales and bets placed by gambling addicts, but does not find any way to capture time spent raising children or the value of clean air, is no longer fit for purpose. We have known that for decades.
The impacts of consumption and growth-driven production on our planet do not need to be articulated in this room. I know that because this country and others like it consume, drill, burn and dump at a rate that would require numerous planets to sustain it. That, of course, causes negative impacts for the planet and its inhabitants.
It would be one thing to keep pursuing this model if it resulted in a healthy and happy population, but it does not. We know that income inequality in the UK is higher than it has been for decades, and probably the highest in Europe. It affects people at every single point on the economic distribution scale, as well as overall societal cohesion. In the absence of any serious mitigation policies, that will unfortunately only get worse.
I thank the hon. Lady for giving way in her fantastic speech. She may agree that part of the growth delusion—this constant demand for GDP and growth—is that it will actually begin to trickle down to poorer members of society, both domestically and internationally, yet that does not happen. Rather than keeping on growing the pie, destroying the economy and the planet, would it not be better to better share out the pie we already have within the current limits of the ecology and the environment?
The hon. Member is absolutely right. We have proven that the theories he outlines, which are supposed to be in place, have not worked, and that our economy has not worked. The kind of model that he suggests, which allows people to flourish, is desirable and achievable.
As with addressing climate breakdown, we know what has to be done; we just have to decide to do it. While it is tempting and valid to protest and rage against the machine on this, it is very encouraging to see some of the practical initiatives that people are taking across their constituencies and in other regions. I pay tribute to groups such as the Carryduff Regeneration Forum, the Conservation Volunteers, Open Ormeau, Repair Café Belfast and many others in my own corner of the world who are showing what is possible when people try to slow down, clean up and build cohesion, and what is possible through care, education and creativity.
Northern Ireland is among the most nature-depleted regions in the world. Currently, we have no binding environmental targets, no environmental protection agency and no coherent plan to address that. We do not even have any certainty that the Assembly will stay up long enough to pass the Climate Bill that the Green party, my own party and others are bringing through at the moment.
Members have outlined some of the many solutions that are in place and some of the Bills that are currently working through that can help us achieve environmental and generational justice, because the impacts on future generations are very real. We need to be real about the possibilities and limitations of green growth and rescue technologies. As the hon. Member for Norwich South (Clive Lewis) outlined, some of these have been demonstrated to not necessarily have the solution to all our problems.
We need to embrace lower labour productivity at times, and accept that long hours and low-reward jobs, where people are working just to stand still economically and consume, are not good for them or for the planet. We also need to encourage reporting of non-GDP measurements. The ONS records these, but we do not use them and they do not get reported in the media, and we know that, unfortunately, what gets reported, gets done.
Members have rightly referenced initiatives in New Zealand, Scotland and Wales, and I look forward to hearing from the Minister how the UK Government as a whole intends to step up in this regard.
I am grateful to the hon. Member for Brighton, Pavilion (Caroline Lucas) for this hour to reflect on a different economic model—an hour that should pivot the wanton greed of state to one of restoring the scars of its heritage.
Leaving Glasgow with our planet heating at a dangerous rate and the failure to slam the brakes on climate destruction, the Government were given a year to reset. COP27 will be their reckoning. Right now, the global south is paying for the exploits of the global north, and this generation is paying for centuries of colonialisation, industrialisation and exploitation, as people and planet were exploited, minerals, crops and humanity were exploited, and carbon and hope were burnt. In this generation, it is our duty to restore. We have no choice.
Kate Raworth’s work on doughnut economics shows us a path out. York Central development, at the heart of my constituency, could be the first doughnut development, where we see the planned luxury apartments becoming sustainable housing that meets need. We could see that site being car free, wellbeing communities being built and a carbon negative future with our green new deal.
As I set out in my Adjournment debate last week, York is seeking to lead. Our green new deal, BioYorkshire, will create 4,000 green-collar jobs and upskill 25,000 people as it takes 2.8 million tonnes of carbon out of our atmosphere and repurposes 1.2 million tonnes of landfill. With research and development of new precision-farming agricultural practices, it is the point where international development will meet international trade. While partners from the University of York, Askham Bryan College and Fera Science have reached out into the region, it is my hope that this green new deal will reach out across the globe, such is the power of its science.
It is this project that will put pride back into my community—one that to this very day celebrates the Rowntree legacy of integrating good business with good employment and social practices. In parallel, York has developed the good business charter. I hope that the Minister is aware of the charter, supported by the CBI and TUC, as it sets out 10 principles, including a real living wage, employee wellbeing, environmental responsibility and ethical sourcing, resetting the terms for business, the economy and workers. Different parts of the economy should not be able to choose whether or not they opt into those initiatives. We need a comprehensive refocus. Labour in Wales was the first in the world to introduce a wellbeing Act—the Well-being of Future Generations (Wales) Act 2015—and the rest of the UK must now follow. Instead, this Government’s mantra seems to be, “Always need to take, not restore”, and that must be reversed.
Just imagine if those principles had been embedded in our approach to the covid-19 vaccine. We would not be debating omicron today. Given that the west has hoarded and destroyed global vaccine supplies—and taken at least three vaccines for each of us—the vaccine rate in developing countries is just 3%. For the sake of profit for big pharma, this Government are prepared to sacrifice the global south. However, in this interconnected world, we too will fall prey to a virus that does not play by the rules. That is why we need to change the rules that govern us. It may not be omicron that calls us short—it may be the pyro or sigma variants.
This is about moving from a mindset of economic nationalism to one of responsible internationalism. The Government were sent to Glasgow to keep the idea of 1.5° alive, but it is now in critical care. Everything must be injected into rehabilitating our economy. The cost of not doing so will be fatal.
Thank you, Mr Betts, for calling me to speak, and I apologise to the Chamber that I was a couple of minutes late for this debate and so missed the opening remarks of the hon. Member for Brighton, Pavilion (Caroline Lucas). I warmly congratulate her on securing this debate and on setting out the substance so clearly, which has been echoed by all the Members who have been able to speak in the time available.
It is disappointing that there were no speeches from Government Back-Benchers, because—and I will say a bit more about this at the end of my remarks—this is not an ideological debate. This is about how we frame, or reframe, the debate. Very few people, and I believe that includes most Government Members, come into politics wanting to impoverish people or increase inequalities. The debate is really about how we get there and achieve a better society, which I hope is an aim that we all share.
One of the key points about the wellbeing economy and reframing the debate is how we measure what matters. My hon. Friend the Member for Stirling (Alyn Smith) said that and it was also echoed by the First Minister of Scotland when she gave a TED talk on this very subject back in 2019. Measuring what matters will help us to reframe the debate and reset the things that we are trying to achieve by the policies that we all want to put forward.
That is particularly important in the context of the conference of the parties and meeting climate goals, as the title of the debate suggests, because at the end of the day the costs of climate change will have to be paid for. It is a bit like covid-19: we are going to have to pay for climate change. We can either pay for it now by taking action to mitigate the damage that has already been done and adapting to the damage that is coming down the line, or we can pay for it later, once our cities are under water and there is even greater human displacement because parts of the world become unliveable.
We have been speaking in this debate today about future generations. I cannot recommend highly enough “The Ministry for the Future”, a book by Kim Stanley Robinson, which deals with an awful lot of those challenges. We also face not an ageing population per se but a longer-lived population and the risk that brings of increasing inequalities. That has to be tackled, and reframing the debate through a wellbeing approach is one of the most effective ways in which we can do that.
The hon. Member for Salford and Eccles (Rebecca Long Bailey) spoke about my constituent, Dr Katherine Trebeck, who really is a leading thinker on this matter. She talks about cornerstone indicators of how we can measure progress in society. The number of girls who ride a bike to school should be, and can be, a measure of achievement in society. It sums up the many things that have to go right—all those different things that lead to young girls being able to cycle to school, whether in this country or in sub-Saharan African—and it brings many benefits. That would be a demonstration—a real indicator —that we were using our wealth, knowledge and resources effectively, and that we were meeting the goals that will bring about a better society.
Scotland is buying into this. We can go further. We have heard about the relationship that has been established with the Greens, which I warmly welcome. My hon. Friend the Member for Aberdeen North (Kirsty Blackman) talked about what Scotland could achieve if we were an independent country and had all the powers at our hands. Nevertheless, the national performance framework has been in place since 2007. There are 81 different national indicators that reflect the values and aspirations of the people of Scotland. They are aligned with the sustainable development goals of the United Nations and are there to help to track progress in reducing inequality. Scotland was a founding member of the Wellbeing Economy Governments partnership, which was founded in 2018 and continues to grow. It met during COP26 precisely to progress those goals.
That is why I emphasise to the Government that this is not ideological per se: it is a challenge to both the traditional left and the traditional right. If we agree that the aim is to reduce inequality, to improve wellbeing and to meet climate goals, we can have a debate about how best to do that. Perhaps there is an argument for the free market, for the leveraging of capital, for innovation and entrepreneurship; perhaps there is a greater role for the state and the investment of public money, goods and resources. That is the clash of ideas, but this is changing the goal that we are heading for, because infinite growth on a finite planet simply is not possible.
I encourage the Government to take this on and to look at what other ambitious countries around the world and their own devolved institutions are doing. If they are not prepared to do that or to follow along with the devolved institutions, we will see continued divergence, and that will only help the cause of Members such as myself in the Scottish National party, and those who want to see further devolution and ultimately independence. The Government must get into a 21st-century mindset, and that means leaving 19th and 20th-century ideas of unlimited growth as the only measure of success far behind.
Thank you for your chairmanship today, Mr Betts. I begin by congratulating the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing the debate and thank all the hon. Members who have taken part over the past hour or so.
The debate on the relationship between wellbeing and the traditional economic growth measure of GDP has been going on for a long time. We welcome an emphasis on wellbeing and on not measuring everything purely by traditional economic statistics. As we have heard, there are deficiencies in GDP. For example, it tells us nothing about equality or the level of social inclusion in a society. That is what it does not include, but it does include things we might not want to include, such as measures of waste or of throwaway goods that are bad for our environment.
As a material measure of output, GDP is certainly not the same as general happiness. That is why in my party, for example, my hon. Friend the Member for Wirral South (Alison McGovern) has argued that the Office for National Statistics should measure health and happiness through a healthy living index. We have heard about what the Welsh Labour Government are doing, putting wellbeing at the heart of their thinking.
As we transition to a cleaner and greener economy, we will want to take into account other things, most obviously the sources of our energy and how renewable they are. We will want to ask different questions—not just, “What did you produce?” but, “How did you produce that?” All that will have to be a greater part of our economic thinking. We do, after all, have only one planet, and we have a duty to cherish and preserve it for future generations.
This debate also forces a discussion on not only the costs of acting, but the costs of not acting. The Office for Budget Responsibility report earlier this year was very clear on that point. If we delay taking the necessary action on the transition to net zero, it will not make the costs disappear. Instead, it will increase them in the longer run, adding to our debt and our deficit, and loading further costs on the taxpayer. That is why Labour announced at our recent conference a commitment to investing in this transition year on year for a decade.
That commitment will help to ensure that the homes we live in are heated in a sustainable way. In so doing, it will create many jobs, reduce people’s heating bills and make a material contribution to the wellbeing we have heard about today. We will also want to invest in the charging infrastructure for low-carbon transport, and many of the other changes we need. That is what we want to do.
Let us not be entirely dismissive of GDP and the importance of economic growth. For the past decade, we have had, as it were, a real-world experiment in what it is like to live through low growth. We have high taxes now because economic growth has been low. That anaemic growth over the past decade means that we are a less prosperous country than we would have been had we had higher growth rates—for example, the kind of growth rates that we had in the first decade of this century. That has borne down on real incomes and on public services and their capacity to improve wellbeing.
Low economic growth over the past decade has adversely impacted on the quality of life in places such as Wolverhampton, which I represent, the Black Country and many other parts of the country. It has left the public square impoverished and degraded. In arguing for a broader view, we should not make the mistake of thinking that low growth or no growth is a good thing. The experience of low growth over the past decade suggests that that is very much not the case. I am all for a broader definition, I am all for greener growth, but I also want to see prosperity in every part of the country.
It is a pleasure to serve under your chairmanship, Mr Betts, and to answer the debate on behalf of the Government. I congratulate the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing a debate on an issue about which she cares deeply and speaks eloquently. I thank other hon. Members for their thoughtful contributions to what has been a good conversation in this Chamber.
I hope that it will not come as a surprise to hon. Members that this is a subject that the Government take seriously and that, as a Treasury Minister, I care about deeply. Much of what we are doing in fact aligns with a wellbeing economy approach. More than that, as a Government, we are clear that the wellbeing of our citizens and the natural environment is a priority as we work to deliver our world-leading climate goals.
Given the topic, this has been a wide-ranging debate. In answering it, I will talk first about how we are already thinking differently about wellbeing and the economy, and then about how we are acting differently, based on that new way of thinking. To be clear, the Government are already taking steps towards a broader understanding of progress and GDP growth. Rather than simply measuring our success in conventional economic terms, we are increasingly focusing on a range of measures, including reductions in carbon emissions, improvements in air quality and increases in skills, among other things.
As a Treasury Minister, however, it would be strange for me not to argue that a traditional economic metric such as GDP remains important and useful. I think that the shadow Minister, the right hon. Member for Wolverhampton South East (Mr McFadden), and I are probably in agreement on that. Nevertheless, GDP has its limitations. It should not be seen as an all-encompassing measure of welfare, which it was never designed to be, and nor is it an end in itself, as several hon. Members have said.
The Government fully supported the recommendations of Sir Charles Bean’s 2016 independent review of economic statistics, which acknowledged some of GDP’s limitations. We are committed to broadening the range of metrics that we use to measure welfare, including better accounting of human capital.
We provided the Office for National Statistics, for example, with an additional £25 million to improve UK economic statistics, including through the Beyond GDP initiative, which aims to develop new and broader measures of welfare and activity, such as a suite of personal wellbeing measures that better account for unpaid work, and estimates for human capital. I heard the hon. Member for Brighton, Pavilion say, “Don’t talk about the ONS”, but I assure her that ONS work on measuring natural capital is ongoing.
We have updated the rules that we use in the Treasury, as set out in the Green Book, to guide individual spending decisions. Those rules already take into account much more than the direct effects of GDP, including estimates of wider economic, social and environmental benefits. This year we introduced to the Green Book new guidance for considering wellbeing in detail as part of policy appraisal.
Several hon. Members have spoken about valuing nature and natural capital. The Government agree unambiguously with the central conclusion of the Dasgupta review that nature and the biodiversity that underpins it ultimately sustains economies, livelihoods and wellbeing. We also agree that only by accounting for the natural environment can we have a more complete view when balancing social, economic and environmental considerations in decision making. In other words, we know that natural capital matters and we are factoring it more and more into our thinking.
In response to the Dasgupta review, the Government are working to deliver a nature-positive economy so that we can be the first generation to leave the natural environment in a better state than we found it. Let us not underplay the significance of that. It is a genuine paradigm shift, and it is being put into action through the Environment Act 2021, including mandating biodiversity net gain for development to make sure that much needed development does not come at the expense of nature. That is why we have been working with the ONS to improve the way in which nature is incorporated in our national accounts, providing funding to explore improvement in its natural capital estimates to improve their relevance to policy making and through the consideration of a broader measure of economic activity than is currently captured by GDP. The recent spending review made investments to improve our understanding of the country’s natural capital with £140 million of funding to map the extent and condition of the country’s natural habitats.
Clearly a big part of our work in this area relates to efforts to tackle climate change by achieving net zero, which is part of my brief at the Treasury. The UK’s comprehensive legislative framework for tackling climate change, which revolves around setting carbon budgets, shows clearly how factors other than GDP sit centrally within our economic policy. That approach has been a success. Between 1990 and 2019, under Governments of different colours, the UK has reduced its greenhouse gas emissions by 44%, faster than any other country in the G20. Since March 2021, the Government have committed to invest £30 billion in our green industrial revolution. That spending, along with action on regulation and green finance initiatives, is about keeping the UK on track for our carbon budgets, establishing our long-term pathway towards net zero by 2050.
There has been widespread agreement in the Chamber about acting sooner rather than later on climate change, and specifically acting to prevent future climate change and investing to that end. I agree with the hon. Member for Stirling (Alyn Smith) that it is not a choice of either growth or the environment—it is not either/or but both. Our transition to net zero is a growth opportunity in itself. We expect to see hundreds of thousands of new jobs in the green economy. Not all growth includes consuming finite resources; doing things better can also boost GDP.
We also want new jobs to be well paid. That is absolutely part of our vision. We are aiming for a higher paid, higher skilled economy. I disagree with the hon. Member for Salford and Eccles (Rebecca Long Bailey) who said that growth means nothing to a struggling family. I disagree. Growth does matter. If we have a shrinking economy, a struggling family is less likely to have jobs, less likely to see their income go up, less likely to see improvements in their standard of living and less likely to have the opportunity to come out of poverty. Growth means more jobs. It means higher incomes. It means the opportunity for people’s wellbeing to improve.
As I said at the beginning of this debate, this is a wide-ranging issue, but I hope hon. Members will recognise that the Government are taking a comprehensive approach. I recognise that sometimes Ministers can fall into a trap in such debates by delivering a long list of policy actions, but I would say that our actions really do speak as loudly as any words. I know that the hon. Member for Brighton, Pavilion and other Members who have spoken today care deeply about the issues, but so do the Government.
On the specifics of the debate, our objective pure and simple is an approach that gives us the very best chance of meeting our climate goals in a way that maximises wellbeing for all—in fact, overall improving the wellbeing of the population of this country. We are thinking differently. We are acting differently. We are investing differently. We do indeed want to do that collaboratively, including by working closely with hon. Members across the House.
I thank everyone who has taken part in the debate; I really appreciate it. I have been struck by how well Scotland, Wales and Northern Ireland have been represented in it. I regret that there have not been more speeches from Government Members, because debating the purpose of our economy is surely the most important thing we could be doing. We will have big debates about how we get to the outcome that we all agree we want, but it is rather strange that there are not more people here from the Government side to have that debate.
I appreciate the Minister’s warm words, but there is a vast gap between what she is saying and what the Government are doing. Let us take one simple way of looking at this. A report comes out from the Treasury called “HM Treasury Outcome Delivery Plan”. It is the key departmental document setting out priority outcomes and activities. It has just one paltry mention of climate and just one reference to decarbonisation. It makes no mention at all of biodiversity, but it has 17 mentions of growth. The Government are still subsidising fossil fuels annually to the tune of around £12 billion, and there is still on the statute book a duty to maximise the economic recovery of oil and gas.
There is so much to be said in such a short amount of time, but I urge the Minister to look again at what all of us have been saying in the debate. We should not simply revert to the old idea that growth is somehow the best way to address the kind of poverty that the hon. Member for Salford and Eccles (Rebecca Long Bailey) spoke about. Redistribution is a far more effective way of getting resources to those who need them. It is a convenient myth that if we keep growing the cake, those at the bottom of the pile will eventually get some. Well, they will have to wait a hell of a long time; and by the time they get it, the planet will be pretty much stuffed.
We need to shift to a greener economy right now. This does not have to be a party political issue; it was David Cameron who started talking about gross domestic happiness, and the right hon. Member for South Holland and The Deepings (Sir John Hayes) has spoken eloquently —and surprisingly—about moving away from the myth of the ever-increasing economy. I ask the Minister to please look at bringing forward new measures of economic wellbeing along the lines of those that many of us have suggested. She could have them alongside GDP, if she does not want to replace GDP.
I say to the right hon. Member for Wolverhampton South East (Mr McFadden) on the Labour Front Bench that there is a big difference between having low or no growth in a recession and a planned transition to a more stable, steady-state economy. I urge him to read such books as “Prosperity Without Growth” by Professor Tim Jackson, which absolutely sets out the way forward on this.
Question put and agreed to.
That this House has considered a wellbeing economy approach to meeting climate goals.