Rt Hon Sir John Redwood MP (Wokingham) (Con): I welcome the change of policy. In order to reassure both patients and staff about safety, what progress can the Secretary of State report to the House on better air extraction, air cleaning and ultraviolet filtration? I think that we need to control the virus without telling people exactly what they have to do in their own health treatments.

Sajid Javid (Secretary of State for Health and Social Care): As always, my right hon. Friend has asked a very good question. He will know that infection protection control measures have been in place during the pandemic; they change along with the pandemic over time, depending on the risk profile, and that applies to care settings. The Government have supported care homes with hundreds of millions of pounds to make adaptations and changes and to implement these measures, and I know that many care settings have taken advantage of those funds to provide, for instance, air filtration and ventilation. That is the kind of support that the Government will continue to give.

BEIS stands for the Department for Business, energy and industrial strategy. I wonder if it has quietly been repurposed as the Department for Blocking Enterprise and for Import Success.

Its Energy desk is turns down or delays new oil and gas field developments at home. It prefers the UK to import LNG from around the world, creating more CO2 when that is burned than if it had allowed us to produce more natural gas from the North Sea. It has set out a so called transition plan which is a plan to run down our own domestic gas and oil industry whilst we will still be needing those products from elsewhere.

Its industry desk is busy imposing high carbon taxes on all our businesses that need to burn gas to transform materials with heat as well as encouraging higher prices for fossil fuels by limiting domestic supply. Our steel, ceramics, glass and similar industries are struggling to keep open against cheaper foreign competition which does not face such high energy prices.

Our steel industry needs specialist coal for its furnaces. The department blocks a potential UK mine that could supply them, again forcing imports. Our steel industry almost halved under the last  Labour government from 18.5 m tonnes to 9.7 million tonnes by 2010 is now around just 7 million tonnes. We import much of what we need.

Our aluminium industry has been reduced to just one main smelter of ore running on Scottish hydro power. The Anglesey and Lynemouth smelters are long gone with no plans to rebuild our ability to make this essential metal thanks to energy prices and availability. Our petrochemical industry has been slimmed as the availability of domestic feedstock has reduced.

Isn’t it time for a rethink? You do not save the planet by outsourcing most of the high energy and gas using products you need. You transfer the CO2 production elsewhere and with it the jobs, added value and security of supply we need at home. If the government wants to level up it should grasp the importance of ceramics to the Potteries, of steel to Sheffield, of chemicals to Merseyside, of oil and gas to Aberdeen and many other locations for all of the above.

The Chancellor was seeking the mantle of Thatcher in his joint article with the PM yesterday in the Sunday Times. He claimed to be a low tax Conservative, but also a supporter of sound money which he attributed to her. He also says he wants “lighter,better,simpler regulation”.  So what does the track record show?

So far the Chancellor has hiked taxes on entrepreneurs and the self employed through IR35. He has raised National Insurance, frozen Income tax allowances and put in a huge future  increase in Corporation tax. He seems keen to ensure we collect less in tax than he would by setting competitive rates. Margaret Thatcher and her Chancellors cut Income tax rates substantially, cut Corporation tax, made it easer for the self employed and for entrepreneurs. As a result revenues surged, the rich paid more tax and paid a bigger share of the tax, and substantial increases were made in the NHS budgets from the extra revenue.

So far the Chancellor has approved huge increases in money printing proposed by the Bank of England but needing his consent, which have now brought on a sharp rise in inflation. I strongly supported the early pandemic related money boost, but called for it to end last year when the Bank carried it on well into recovery. Margaret Thatcher battled for honest money and brought inflation down from the high levels under Labour. Towards the end she was forced by her  Chancellor  and Foreign Secretary to take the UK into the European Exchange Rate Mechanism, against her instincts and my advice. That led to a surge in money and credit creation by the commercial banks and to a nasty bout of inflation. This was followed by the inevitable bust under John Major who took her job and the then unhelpful  economic inheritance he had  created . This ended the Conservative reputation for economic competence for a good few years.

I look forward to the plan to have better and lighter regulation. More than a year into Brexit there has still been no Bill to change the main huge body of EU regulatory law which we rolled over as a temporary measure. The Chancellor would say he has streamlined alcohol duties a bit. The ones that have gone up are not popular, but it is a minor set of adjustments so far. We await the promised Freeports and trust they will have some good freedoms  in them. Why not one for Northern Ireland?

The Opposition still regards the Thatcherite label as a term of abuse. The Chancellor seems to regard it as a plus, but has misunderstood the nature of Margaret’s policies compared to his own. His approach to tax is the opposite of hers.

During the referendum on the EU the car industry and its Remain supporters were full of fears that if we left the EU without a free trade deal with them the 10% tariff the EU would impose on our car exports would do grave damage to our industry. They did not accept that a zero tariff deal was likely, though one was finalised in the end. Nor did they accept that if there were 10% EU tariffs we could have imposed the same on their cars and made more of our cars at home, substituting  them for the  dearer continental imports. Out of the EU we are also free to take tariffs down on components needed from abroad to lower our total costs of production. I did not  see anyone suggest output of our industry might halve if we ended up with some EU tariffs.

The passion behind these fears makes the lack of noise about the collapse of car output since 2016 more surprising. The near halving of output in the last five years has  nothing to do with Brexit. We can all agree the pandemic measures dented output badly in 2020 and may have had some lingering effects on 2021.  Last year we only made 859,000 cars in the UK. We can agree that the worldwide shortage of microprocessors has impeded production in the last year, as the car industry failed to secure enough supply at a time of maximum competition from the digital revolution companies needing more chips for their successful products.  Apple’s gain was BMW’s loss. What seems more contentious is the impact of the race to net zero on  the domestic industry which most of the insiders seem unwilling to talk about, let alone cite as an important cause of the decline.

In  the last couple of years there has been a collapse in purchases of new diesel cars, and a decline in new petrol cars as a  result of governments in advanced countries especially the UK telling people not to buy them. Advanced countries have been discussing how quickly they can end their production altogether and making it clear to customers they wish to become increasingly hostile to the use of internal combustion engine vehicles. The UK has proposed 2030 as the cut off date. The Treasury has also added its contribution to car output decline with a substantial increase in the cost of VED for a new dearer car. The diesel hit has been particularly tough on the UK industry. With government encouragement not so long ago the UK  had become  an important world centre for diesel technology development and for engine manufacture. Ford for example moved its car assembly out of the UK but built a lot of engines here.

Tesla has turned out to be the winner so far in the expensive end electric vehicles. Tesla makes no cars in the UK. The UK based brands have been slower to compete, and the UK is struggling to  catch up with battery production investment, essential if the UK is to be a serious producer of electric vehicles. Maybe it is time to assess the progress of these policies, and to ask how much more damage there is likely to be to an industry which used to make twice as many cars here.

Today I publish  four answers I have received to energy questions. They reveal a  slow and painful transition to a more realistic stance on UK energy capacity and needs. On the positive side the government is now recognising the need to replace the current nuclear capacity it is closing. It had already  committed to the expensive Hinkley C  which should come on stream this decade and will offset part of the loss of capacity from nuclear plant closures. It now wants to put in Sizewell C which is also likely to be very expensive and is unlikely before sometime in the next decade. It is also working up plans with Rolls Royce on small modular nuclear reactors. These could be in series production in  the next decade and could make a useful contribution to capacity. They are currently thought to be considerably cheaper than large nuclear. That still has to be grounded by establishing a scalable prototype.

The government’s estimate of how much electricity we will need this decade reveals relatively slow rates of growth after 2025 and  practically no growth for the first half of the decade. This may be realistic, but it implies the government does not expect many  additions to the electric vehicle fleet or to electric home heating before 2025 and a slow rate of climb thereafter. I would have thought they would want to have more capacity available in advance of the breakthrough in the electrical revolution they urge, to reassure potential users that there will  be sufficient power for  the explosion in demand they want to engineer.

Their approach on gas has shifted a bit, with more recognition of the importance of gas to our current energy needs, and recognition of it as a transition fuel. I believe Ministers also now see the need to produce more domestic gas instead of burning imported gas. However, this answer still leaves open the probability that the Regulators will weight the need to run down gas more highly than the obvious need at the moment to produce more of it at home. They clearly still want to end the three coal power stations that have kept the lights on at times of little wind this winter, which is worrying.  Officials seem wedded to energy insecurity as a policy allied to maximising imports. Ministers need to press harder. 

I will continue to press the issues of our vulnerability, both because we rely too much on imports and because their forecasts of growth in demand are so small. We need more domestic capacity.

Question:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what estimate he has made of trends in electricity demand in the UK up to 2030. (105322)

Tabled on: 17 January 2022

Answer:
Greg Hands:

The table below shows the Department’s latest published projections of total electricity supplied by UK generators from the year 2021 up to 2030, net of storage and imports. Supply is modelled to meet projected demand and takes account of demand trends.

These figures are based on central estimates of economic growth, fossil fuel prices and contains all agreed policies where decisions on policy design were sufficiently advanced to allow robust estimates of impact as of August 2019. Further details can be found at https://www.gov.uk/government/collections/energy-and-emissions-projections. Figures provided are extracted from BEIS Energy and Emissions Projections: Net Zero Strategy baseline (partial interim update December 2021) Annex J, Total electricity generation by source.

The answer was submitted on 25 Jan 2022 at 17:16.

Question:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what plans he has to grant permits to allow companies to develop new gas and oil fields that have investment plans and proven reserves; and what the timetable is for the granting of those permits. (105318)

Tabled on: 17 January 2022

Answer:
Greg Hands:

The UK offshore oil and gas sector is important; it continues to heat homes, fuel cars and underpin security of supply while the Government grows its renewables sector and develops its low carbon infrastructure. As the Government moves to a low carbon future, the sector needs a managed transition, to avoid losing the employment and expertise which will help us achieve the energy transition.

Before proceeding to consent, proposals for field development are subject to extensive scrutiny by regulators: the Oil and Gas Authority and the Offshore Petroleum Regulator for Environment and Decommissioning. The Government does not comment on individual projects undergoing the regulatory process. Any decisions made by these regulators are published in due course.

The answer was submitted on 25 Jan 2022 at 17:09.

Question:
To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will ensure that the coal power stations currently used when there is little wind will be kept available until the UK has more reliable domestic generating capacity to cover a shortage of wind energy. (105320)

Tabled on: 17 January 2022

Answer:
Greg Hands:

The Government is committed to phasing out unabated coal generation by October 2024. The Government is confident that the Capacity Market will ensure there is sufficient capacity to offset the retirement of the remaining coal plants. The most recent Capacity Market auctions have already secured the majority of Great Britain’s capacity needs out to 2024/25.

National Grid Electricity System Operator has the ability to manage electricity supply and demand, including at times of low wind generation. It can call on a wide range of technology types to do this, including gas, batteries, interconnectors and demand-side response.

The answer was submitted on 25 Jan 2022 at 17:06.

Question:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what plans he has to make up for the reduction in energy derived from nuclear power in this decade as the current fleet of nuclear stations close. (105321)

Tabled on: 17 January 2022

Answer:
Greg Hands:

This Government is committed to nuclear power in our future diverse energy mix:

• Hinkley Point C will supply 3.2GW of secure, low carbon electricity for around 60 years, meeting around 7% of GB’s current electricity requirements. Hinkley has roughly the equivalent output to three of its predecessors.
• The Government are progressing negotiations over Sizewell C in Suffolk.
• Our £385m Advanced Nuclear Fund, the Government have awarded £210m to Rolls-Royce SMR to develop their SMR design and are supporting AMR development.
• The Government also announced a new £120m Nuclear Enabling Fund to provide targeted support to address barriers to entry for future nuclear,
• Later this year the Government will publish a nuclear roadmap setting out the government’s strategy in more detail.
• The Nuclear Energy (Finance) Bill will reduce the obstacles to financing new nuclear projects.

The answer was submitted on 25 Jan 2022 at 17:05.