Consideration of Bill, as amended in the Public Bill Committee New
Clause 1 Future of the Infrastructure Bank “The Bank may not be
sold until commitments to meet net zero by 2050 and duties set out
in section 1 of the Climate Change Act 2008 and commitments and
duties set out in section 1 of the Environment Act 2021 have been
met.”—(Richard Foord.) This new clause would ensure that the
Investment Bank remains in operation until the Government’s net
zero...Request free trial
Consideration of Bill, as amended in the Public Bill
Committee
New Clause 1
Future of the Infrastructure Bank
“The Bank may not be sold until commitments to meet net zero by
2050 and duties set out in section 1 of the Climate Change Act
2008 and commitments and duties set out in section 1 of the
Environment Act 2021 have been met.”—(.)
This new clause would ensure that the Investment Bank remains in
operation until the Government’s net zero and environmental
commitments have been met.
Brought up, and read the First time.
14:41:00
(Tiverton and Honiton)
(LD)
I beg to move, That the clause be read a Second time.
Mr Deputy Speaker ( )
With this it will be convenient to discuss the following:
New clause 2—Businesses and bodies the Bank invests in—
“(1) The Bank must publish an annual report setting out—
(a) the geographical spread of businesses and bodies it invests
in, and
(b) the ownership of the businesses and bodies it invests in.
(2) The Bank must prepare and publish a ‘Good Jobs’ plan for all
businesses and bodies it invests in, which requires the business
or body to improve productivity, pay, jobs and living
standards.”
This new clause would ensure that the Bank considers the location
and ownership of the businesses and bodies it invests in and only
invests in businesses and bodies who create “Good Jobs” plans to
improve productivity, pay, jobs and living standards.
Amendment 5, in clause 2, page 1, line 14, at end insert—
“(i) to reduce economic inequalities within and between regions
of the United Kingdom, and
(ii) to improve productivity, pay, jobs and living standards.
(c) to support supply chain resilience and the United Kingdom’s
industrial strategy.”
This amendment would ensure that the Bank’s objective to support
regional and local economic growth includes reducing economic
inequalities within and between regions and improving
productivity, pay, jobs, and living standards. It would also
create a third objective for the Bank to support supply chain
resilience and the UK’s industrial strategy.
Amendment 3, page 1, line 14, at end insert, “, and
(c) to improve water quality in the UK.”
This amendment would add improving water quality in the UK to the
Bank’s objectives.
Amendment 4, page 1, line 22, at end insert—
“(4A) The Bank may only provide any of the support listed in
subsection (4) to water companies if they have produced a costed,
time limited plan demonstrating they are committed to preventing
discharge.”
This amendment would require water companies to have a costed,
time limited plan, demonstrating they are committed to preventing
discharges before they can receive investment from the UKIB.
Amendment 2, page 2, line 9, leave out “consult” and insert—
“gain the express consent of”.
This amendment would require the Treasury to gain the express
consent of the appropriate national authority before making
provision in regulations under subsection (6).
Government amendment 1.
I rise to speak to new clause 1 and amendments 3 and 4.
I welcome the UK Infrastructure Bank Bill. We previously had a
Green Investment Bank, founded by the Liberal Democrats in
government. It was short-sighted for the Government to sell it
off, especially as it made £144 million in profit for its
Australian owners last year. Nevertheless, the Liberal Democrats
are glad to see steps finally being taken to put the replacement
UK Infrastructure Bank on a statutory footing.
Liberal Democrat new clause 1, in the name of my hon. Friend the
Member for Richmond Park (), seeks to ensure that this
new UK Infrastructure Bank will remain in operation until the
Government’s net zero and environmental commitments have been
met.
I hope to see this new bank change investment in green
infrastructure for the better, and this brings me to the two
amendments—amendments 3 and 4—tabled in my name and those of
Liberal Democrat colleagues. They seek to ensure that water
companies set out costed, time-limited plans to deal with
discharges before they can get funding through the bank. This is
important because communities across the UK are currently being
impacted by the actions of some negligent and wayward water
companies. For years, we have seen these firms failing to invest
in our vital infrastructure, but instead prioritising shareholder
payouts and bumper bonuses for chief executive officers. It is
shocking that this practice has been allowed to continue, and
that the Government have resisted several attempts by the Liberal
Democrats to clamp down on these sewage spills.
South West Water, which covers my patch in Devon, was awarded a
one-star rating by the Environment Agency after having been found
to have discharged sewage into rivers and lakes and on to our
beaches over 42,000 times. This represents more than 350,000
hours of dumping, including at our prestigious blue flag beaches.
Three of the 10 most affected beaches are in Devon. And what was
the reaction at South West Water? It gave the chief executive a
bonus of more than £1 million.
(North East Bedfordshire)
(Con)
We on the Government Benches are aware of some of the comments—if
I may say so, the somewhat misleading comments—in Liberal
Democrat propaganda about this issue. The hon. Gentleman is
obviously familiar with the situation at South West Water. Could
he tell me what the cost is to South West Water of eliminating
sewage overflow, and what are the implications for water bills
for residents in the south-west, because that is what the
literature from his party has been saying needs to be done?
The amendment that we are considering is about loans from the UK
Infrastructure Bank. Whatever figure is required, the bank should
not be permitted to release funds for the purpose of improving
our sewerage system until there are plans by water companies for
the system’s complete restoration.
14:45:00
South West Water is not an isolated case. Last year alone, water
companies paid out dividends to the tune of almost £1 billion,
with water company executives pocketing £16.5 million in bonuses.
Why should those people profit from others’ misery? Why should
they be allowed to cut corners and get away with it? The
situation is the same across the country.
Southern Water polluted our rivers and waterways more than 38,000
times in the past two years, with over 358,000 hours of spills,
while their top executives raked in more than £2.3 million in
bonuses, benefits and incentives. Thames Water discharged sewage
into rivers and lakes 33,156 times in the past two years, lasting
378,977 hours in total, and their bosses took home more than £2.9
million on top of their already generous salaries.
It is clear that those water companies are not being run for the
benefit of the British people. Instead, firms are content to sit
back and watch profits pour in while communities across the
country suffer. Their failure to redirect profits to patch up our
ageing infrastructure and build capacity means not only sewage
dumping on an industrial scale, but losing millions of tonnes of
water due to leaking pipes. That amounts to a scale of negligence
unparalleled by anything we have seen in recent years.
The scandal must be addressed, which is why the Liberal Democrats
have tabled these amendments. It would be a scandal if taxpayers’
money were given to the same firms that continue to poison our
rivers and coastlines. If we do not add strict sewerage
conditions to the Bill, we will give a blank cheque using
taxpayers’ money to fund those polluting, profiteering firms.
Those are the very same water companies that line their
executives’ pockets with bonuses worth millions of pounds. Now
they expect public money to bail them out and line the leaking
pipes that they have long neglected. If they want public money to
help bail them out, they must show that they have a serious plan,
which is both costed and time limited, to clean up their act and
end the flow of sewage gushing on to our beaches and into our
rivers.
I urge colleagues from all parties to back the amendments and
show that we are serious about ending the sewage scandal once and
for all.
I shall go through the amendments thoroughly and therefore I
shall not detain the House long.
New clause 1 on the future of the UK Infrastructure Bank would
have the effect of not permitting a sale of the bank until the
duty set out in the Climate Change Act 2008 and the targets of
the net zero commitment by 2050 had been met. That puts
significant strictures on the maintenance of one bank and its
objectives. I think the hon. Member for Tiverton and Honiton
() probably acknowledges that.
He wants us to reflect on the sale of the green bank that was set
up under the coalition Government. He talked about the profits
that it made last year—about £180 million, perhaps a little less.
However, I hope that he recognises a couple of things.
First, when the sale was made, the taxpayer benefited to the tune
of £2.3 billion. That included a surplus of £186 million on
taxpayer-invested funds and a commitment from the successful
acquirer, Macquarie bank, to invest a further £3 billion. In the
round, I do not think that was a bad transaction to make, because
it enabled the attraction of more third-party capital—private
capital—to try to achieve some of the objectives of that green
bank under its new owners, and indeed that has taken place. Part
of the balance with this Infrastructure Bank is: how are we going
to evaluate its abilities and success in attracting third-party
capital? If the hon. Member for Tiverton and Honiton reflects, he
will see that his broad point in new clause 1 is a fair one, but
I hope that he will not press it to a vote, because there are
strong arguments on the other side and I would not support the
points that he would be trying to make.
Again, I can understand some of the import of Labour’s new clause
2 and amendment 5. Labour is saying, “Here is an opportunity,
with a major institution, with which we are going to look at and
try to expand the infrastructure of the country, to make sure it
has a full focus on the round of public interest in the things it
is doing in our name.” That is a good intention but, as the hon.
Member for Erith and Thamesmead () knows—we have talked
about this in Committee—there are trade-offs to be made within
those sets of objectives. As we add objectives to our
institutions, those trade-offs make it more obscure to
parliamentarians and to the public what the intention of the bank
will be.
The objectives that the Government have set out in the Bill are
already clear. They have the benefit of clarity, as we know what
they are. They also cover a wide range of sectors and intentions,
but with the underlying core objective of helping us to meet our
green net zero and climate change objectives.
So if the Opposition wish us to support their amendments, where
do they see the trade-offs being made between achieving those
objectives and having the duties to reduce economic inequalities
between regions, to improve productivity, pay, jobs and living
standards, and to support supply chain resilience? Very few of us
would disagree with some of those objectives—indeed, the
Government are making great strides on some of them with their
levelling-up initiatives—but we have to accept that as we give
directions to some of these institutions with a broad range of
objectives, we are, as democrats, losing some control over how
public money can be directed; we are giving more discretion to
the chief executives of those organisations to do as they see fit
and not perhaps to do as we were laying down in statute. I
encourage the Opposition to think again, and to consider that
perhaps having the clarity and precision of objectives set out in
the Bill is precisely what will enable this and future
Parliaments to exercise control over the Infrastructure Bank.
The hon. Member for Tiverton and Honiton, who is speaking for all
the Liberal Democrats today, as he has graced us with his
presence in a number of the debates, talked a little about the
water companies again. I hope that he will have been listening
today and will be reflecting back to his party’s leadership that
some of the publicity the Liberal Democrats have put out has been
substantially misleading about the intentions and actions of this
Government. Obviously, parties make political statements all the
time, this way and that. However, particularly as he has now
followed up with his proposal for how water company discharge can
be managed, I hope he will see that it is a serious issue and
therefore we should treat it seriously.
Amendment 4 seeks to provide that the support the bank can give
can happen only after the water companies have produced a
“costed, time limited plan”. I think the water companies would
say, “We have already done that.” They have a plan, but not one
that can be implemented just like that, in the flash of an eye—I
mix my metaphors there. I am not sure that the amendment will
have the intention that the hon. Member for Tiverton and Honiton
wishes it to have, given what the water companies are already
doing and what the Government are already doing with the
monitoring and the objectives being set to reduce sewage
discharge.
I will step over what the SNP spokesperson, the right hon. Member
for Dundee East (), put forward, because I am
sure he will be able to elucidate that point clearly—I believe we
have heard it here a number of times, although we are never bored
by the repetition. Finally, I thank the Minister for listening to
the points that were made in Committee and coming forward with
the Government’s amendment.
Finally, I thank the Minister for listening to the points that
were made in Committee and coming forward with the Government’s
amendment. I can see that the Opposition have not put down a
further amendment on that matter, which is a sign that he has got
that judgment call right.
(Dundee East) (SNP)
I will speak to amendment 2 in my name, but before I address that
fully, I will say a little about the other Opposition amendments
and new clauses.
New clause 1 seeks to stop the bank being sold prior to net zero
targets being met, which is sensible in principle, given the fate
of the old green investment bank, as I described on Second
Reading. New clause 2 seeks a report on the geographical spread
of investments, which, again, is sensible given the Government’s
recent track record on allocating money from the levelling-up
fund. It still strikes me as rather absurd that the Prime
Minister’s wealthy Richmond constituency should have been
allocated £90 million, while the entire city of Glasgow received
nothing in the second round of funding. I think we would all want
to ensure that the UK Infrastructure Bank was far more equitable
in its disbursements.
Amendment 5 seeks to reduce inequality and improve productivity.
Amendments 3 and 4 seek to ensure that investment in water supply
quality is permitted, but with conditions on the private
companies receiving it. Each of these amendments and new clauses
have merit, and we will be happy to support any if they are
pressed to a Division.
Government amendment 1 seeks to reduce the gap between reporting
from a maximum of seven to a maximum of five years. That is
progress of a sort, but five years is still too long. I would be
looking for a commitment from the Dispatch Box that the
Government anticipate the review and reporting frequency to be
within the proposed five-year maximum.
Let me briefly reprise what I said about my own amendment on
Second Reading, when I gave the UK Infrastructure Bank and the
Bill a broad welcome. Taking it at face value, there was nothing
to criticise in its objectives of helping to tackle climate
change and supporting the efforts to meet the UK Government’s
2050 target. Nor was there anything to criticise in the objective
to support regional or local economic growth.
What I pointed out, though, is that—the Minister on Second
Reading alluded to this in his speech—the delivery of support to
facilitate local and regional growth in Scotland is provided by
the Scottish Government, local government and other agencies, and
that the green targets in Scotland, such as the earlier net zero
target, are also set independently. It is therefore important
that the UK Infrastructure Bank actually supports the devolved
Governments’ objectives and does not, even inadvertently, end up
working against them. That remains important because we have our
own infrastructure investment plan, our own global capital
investment plan and our own national strategy for economic
transformation that provides the framework for the Scottish
Government’s policy priorities.
In giving the Bill a broad welcome, I also made the point that
while there is clearly an overlap between the strategic
objectives of the UK Infrastructure Bank and the Scottish
National Investment Bank—the wording of the aims of both the UKIB
and the Scottish National Investment Bank are broadly similar—it
is vital to ensure that both banks meet their goals and deliver
the maximum impact for the people of Scotland. In line with the
objectives set in the Bill, it is essential that the two banks
are able to work together to identify and support appropriate
infrastructure projects in Scotland. It is also vital that
Scottish interests are appropriately represented and that there
is an awareness of the Scottish economic context and the Scottish
Government’s policy goals.
To ensure that there is alignment between both banks’ aims, I
have argued that there should be an administrative mechanism,
such as a memorandum of understanding, between the UKIB and the
Scottish National Investment Bank to ensure that policy alignment
is maintained. I fear that unless we have a firm mechanism, the
UKIB’s aims might also be undermined, and there will ultimately
be a risk that it will not deliver fully on its objectives.
However, the Bill merely suggests in line 9 of clause 2(7) that
the Treasury must only
“consult the appropriate national authority before making
provision in regulations…that would be within the legislative
competence of”
one of the devolved Administrations.
15:00:00
The problem we face is that recent evidence suggests that a
consultation is insufficient protection against the UK Government
making inappropriate regulation. For example, the United Kingdom
Internal Market Act 2020 completely undermined devolution by
handing decisions on animal welfare and environmental and food
standards to an unelected quango. The same Act stripped Scotland
of high standards by forcing all the nations of the UK to adhere
to the lowest common denominator. We have seen multiple examples
of the Sewel convention being breached: since Brexit alone, we
have seen the refusal of legislative consent by the Scottish
Parliament overruled during passage of the European Union
(Withdrawal) Act 2018, the United Kingdom Internal Market Act
2020, the European Union (Future Relationship) Act 2020, and the
Elections Act 2021.
Most recently and most egregiously, we saw section 35 of the
Scotland Act 1998 used to stop a Bill from proceeding to Royal
Assent. That was an outrageous decision—a completely unjustified,
full-frontal attack on the democratically elected Scottish
Parliament. Therefore, our amendment 2 seeks to replace the UK
Government’s requirement merely to “consult” with a harder
requirement to
“gain the express consent of”
a devolved Parliament before embarking on regulatory change. I
commend the amendment to the House.
(Carmarthen East and
Dinefwr) (Ind)
I was going to make my points through interventions, but as so
few Members want to speak, I thought I would take the opportunity
to make a speech. I will speak very briefly to new clause 2 and
amendment 5—which stand in the name of the official Opposition,
and deal with the need to ensure that the geographical investment
is spread across the UK, which is of course is something we all
support—and amendment 2, tabled by the right hon. Member for
Dundee East (), which deals with the
constitutional challenges created by these post-Brexit agencies
and frameworks. The right hon. Gentleman made his points very
eloquently, and I fully support what he said.
In my speech on Second Reading, I highlighted how I thought some
of the challenges outlined in these amendments could be dealt
with. In my view, that is primarily by ensuring that post-Brexit
frameworks and agencies such as the UK Infrastructure Bank have a
formal role for the Welsh, Scottish and Northern Ireland
Governments within their constitutions and their administration.
When I made that speech on Second Reading, the Welsh Government
were withholding consent; they have now decided to offer consent
because the UK Government have given an element of a concession
by outlining that a director of the UK Infrastructure Bank will
be responsible for liaising with the Welsh Government—I suppose
the same will be true for the Scottish and Northern Irish
Governments. That does not go quite as far as I was calling for
on Second Reading, when I made the case for the Welsh, Scottish
and Northern Irish Governments to be able to appoint their own
individual directors.
That concession is a step forward, which I of course welcome.
However, the Minister might be aware that the Climate Change,
Environment, and Infrastructure Committee in the Senedd, which
was responsible for scrutinising the legislative consent
mechanism, advised the Welsh Government against awarding
legislative consent because of that lack of a formal role—indeed,
there was no role whatsoever for the Senedd. I would be grateful
if the Minister reflected on my Second Reading speech, where I
made the case that it would be very helpful if the UK
Infrastructure Bank had to be scrutinised by the relevant Senedd
committee, as well as by the Welsh Government.
In conclusion, this really comes down to the Labour party. We
expect that it will form the next UK Government; how is it going
to Brexit retrofit the UK constitution in light of all these
frameworks and agencies that have had to be created since the
Brexit referendum, and since we left the European Union and the
single market in particular? In Labour’s response to this debate,
I very much hope to hear that it is looking at a radical
realignment of the British state when it forms the next UK
Government, giving the Administrations in Wales, Scotland and
Northern Ireland, where appropriate, a formal role in these
post-Brexit agencies and frameworks.
(Erith and Thamesmead)
(Lab)
A lost decade of broken Tory promises has left much of the UK
with second-rate infrastructure, which is why we support the
establishment and the strengthening of the UK Infrastructure Bank
and will not be opposing the Bill. The bank is much needed. It
will invest in projects that support our net zero targets and
contribute to local and regional economic growth. However, we
will go further than the Government and harness the full
potential of the bank to provide good jobs and opportunities
across the country. I will speak to our amendments a little
later.
I wish to start by saying how much I welcome the Government’s
U-turn in relation to their amendment 1. I see Ministers on the
Front Bench who were with us when the Bill was debated in
Committee. I am sure that they notice how similar their amendment
is to the one that Labour tabled at that stage. Indeed, it is
identical to our amendment—an amendment that they voted against.
As Labour has repeatedly emphasised, reviews of the bank’s
performance will be essential to ensuring that it meets its
objectives to invest in the industries of the future. It was
shocking that the Government wanted an initial review in 10 years
with subsequent reviews every five years. The bank needs momentum
and drive behind it, and I am glad to see that the Government
have now realised the error of their thinking and committed to
reviews of the bank every five years.
I commend the hon. Lady for holding the Government to account on
this particular issue of the review period. This is where we are
setting the bank free to go on its mission. As she and I agree—I
think we agree—the initial few years are really very important. I
notice that the Minister has restricted to five years subsequent
assessments, as both the hon. Lady and I thought would be wise,
but there is still that initial seven years. She did not table an
amendment on that, so I wondered what the Opposition’s thinking
was on that initial period?
I am grateful to the hon. Gentleman for his comments. He might
remember that we tabled amendments in Committee and again on
Report on that issue, but because the Government announced a
U-turn, we decided to withdraw our amendment.
Yesterday’s dreadful IMF forecast makes it very clear that
Britain has so much potential but that the Conservative
Government are holding us back. The UK is the only G7 country
forecast to see negative economic growth. Let us look at the
Government’s record on infrastructure: a green homes scheme
closed just six months after its introduction, with a £1 billion
cut from its budget; an energy system that sees fossil fuel
companies making record profits while hard-working people’s bills
soar; and just a fortnight ago, a crucial gigafactory,
Britishvolt, went into administration, leaving the future of the
British electric vehicle market in jeopardy. According to the
Government, the purpose of the UK Infrastructure Bank is to
provide access to money, particularly where there is an
undersupply of private financing. Britishvolt, a UK battery
start-up, was expected to support new jobs and green technology
with a factory in Blyth. Now it is being sold by administrators,
with the Government seemingly abandoning their promises of
levelling up and supporting a green economy.
Just this week, the British electric van start-up “Arrival”
announced that it is cutting 800 jobs, as it moves for extra
funding and green subsidies in the US. Hon. Members will not be
surprised to hear that Labour has no faith in the Government
harnessing the potential of the UK Infrastructure Bank to invest
in the high-skilled jobs of the future. A Labour Government will
use our green prosperity fund to invest in wind, solar and
nuclear energy; insulate 19 million homes; grow our economy; and
get Britain winning the race to net zero. We have tabled new
clause 2 and amendment 5 to ensure that the UK Infrastructure
Bank can play its role in this mission. New clause 2 would
require the bank to publish an annual report setting out the
geographical spread and the ownership of businesses and bodies
that it invests in. It would also require the bank to publish a
good jobs plan for every project it invests in, to ensure that
the project will improve productivity, pay, jobs and living
standards.
(City of Chester) (Lab)
Does my hon. Friend agree that by failing to commit to Northern
Powerhouse Rail, the Government have failed on their levelling-up
promises to the north? Would she, along with me and other Members
who have expressed opinions earlier in the debate, suggest that
the Minister needs to offer the House some assurances that the UK
Infrastructure Bank will distribute its benefit to every part of
the country, with the geographical spread she just mentioned?
My hon. Friend makes strong points about what the Government
should be doing, and I hope the Minister takes them on board. We
have all seen the allegations of favouritism that have beset the
Government’s levelling-up funding, with nothing in the Bill to
guarantee that the bank will distribute its funds to the areas
that need them the most. Our new clause would ensure scrutiny and
transparency over bank investments. Given the Prime Minister’s
now famous boast—I quote it in case Members have forgotten—about
reversing Treasury formulas that
“shoved all the funding into deprived…areas”,
I hope the Minister can see why we think transparency is
necessary. His party, after all, is the party responsible for the
loss of £6.7 billion to fraud and mismanagement.
I hope, too, that the Minister is paying attention right now and
agrees that we want the UK Infrastructure Bank to create
high-skilled, well-paid jobs. With a good jobs plan for every
project that it invests in, we can ensure value for taxpayers’
money. That approach has been taken with previous significant
infrastructure projects in the UK. For example, the Olympic
Delivery Authority worked with trade unions and others to ensure
that the project delivered good quality local jobs, and a similar
approach was taken with High Speed 2. If the Government are as
committed to their levelling-up agenda as they claim to be, I am
sure that they will vote for our new clause today.
Amendment 5 would strengthen the bank’s objectives. It would make
it clear that the bank’s target of boosting regional and local
economic growth includes reducing economic inequalities within
and between regions in the UK. Despite the Government’s
assurances to the contrary, the Bill contains only a watered-down
commitment that could result in the bank’s resources being poorly
targeted and ineffective.
We want a further objective for the bank to contribute to the
UK’s supply chain resilience and industrial strategy. I have
mentioned the collapse of Britishvolt and the warnings of green
investment moving abroad. Those are serious concerns. The
importance of supply chain resilience has become particularly
clear in the wake of the pandemic and as concerns over energy
security have come to the fore with the war in Ukraine. We want
the benefits of the UK Infrastructure Bank to be seen here in the
UK, with home-grown renewables such as offshore wind, solar,
nuclear, hydrogen and tidal power.
The hon. Lady is being generous in giving way, and I am grateful
to her. I want to probe her thoughts a little further on
amendment 5. The Bill, as I have said, has the benefit of being
quite precise in its current objectives. As parliamentarians, we
know that when we take something from statute and leave it to
regulators, the House’s ability to hold them to account in the
public interest is somewhat weakened. Does she accept that
additional objectives would give an Executive a lot more
discretion to say, “I didn’t achieve that because I was focusing
on this objective”? We have created some primary objectives about
climate change and so on. Adding others would leave us somehow
disempowered, because those Executives could move and shake
around where they said their priorities were. As I said earlier,
I am concerned about the balance between laudable objectives and
ensuring that, when we have put the Bill into statute, we
parliamentarians retain the ability to control what is actually
happening on the ground in one, two, three, four and five years
from now.
15:15:00
I thank the hon. Gentleman for his comments—as I say, I always
like to take them on board—but I fundamentally disagree with him,
because our amendment would ensure that we take the Bill further.
As he once said, the best way to promote UK manufacturing jobs
and production is to
“shape regulation to support enterprise.”—[Official Report, 16
November 2021; Vol. 703, c. 438.]
That is exactly what Labour seeks to do with our amendments, so I
really hope he will support them. I understand where he is coming
from, but our amendments would make sure that we deliver the
projects that we need in the UK.
We know that the UK Infrastructure Bank could be a national
enterprise. We have a world-leading offshore wind industry in
Scotland and on the east coast, hydrogen in the north-west and on
Teesside, nuclear power in the south-east, and solar power in the
south and the midlands, but the potential of these industries can
be realised only if investment stays in the UK. The amendments we
have tabled would allow that to happen. The lack of domestic
champions has compromised our security and stalled progress, and
our amendments would enable the UK Infrastructure Bank to help
reverse the trend.
I will speak briefly to the other amendments we are considering
today. Labour strongly supported the circular economy and
nature-based solutions being on the face of the Bill, and we were
disappointed to see the Government remove them, but we are clear
that amendment 4 has not been properly thought through. Nothing
in it would do anything to improve water company performance or
reduce sewage dumping; on the contrary, it would give water
companies an excuse to not undertake the necessary improvement
works. We will therefore not support it. Labour has set out a
clear plan to end the Tory sewage scandal by introducing
mandatory monitoring with automatic fines, ensuring that
regulators properly enforce the rules, and holding water bosses
personally accountable for sewage pollution.
(North Devon) (Con)
Does the hon. Lady not agree, having been in the Chamber earlier
today, that the Government are already monitoring storm overflows
across the country? One of the reasons why we are aware of the
size of the problem that we are trying to tackle is because we
have increased the monitoring from only 6% a few years ago to
nearly 100% now.
I am not going to take any advice from the Government. They have
been in government for 13 years, and what have they delivered so
far? I suggest that the hon. Lady support our amendment, which
would ensure that things go through properly.
The devolved Administrations must be included in the development
of the UK Infrastructure Bank. I have already mentioned the
fantastic wind energy sector that we have in Scotland, and I was
excited to read about the opportunities that the bank has
identified in Northern Ireland. We do not believe that amendment
2 is necessary to ensure that all regions and nations of the UK
benefit from the Bill, so we will not support it.
As we enter another year of low growth and failed Conservative
government, we know there is a vital need to invest in the
infrastructure of the future. We support the establishment of the
UK Infrastructure Bank and have sought to improve the Bill
throughout. We want to see stronger objectives and reporting for
the bank, so that it can play a role in meeting our net zero
targets while creating good jobs across the country and
supporting the UK supply chain’s resilience, but what the bank
needs most of all from the Government is an ambitious plan. Once
again, the Government are on the back foot and U-turning at the
last minute with amendment 1, on the bank’s reviews. It is yet
another sign that Labour is the party with a plan for
government—a party that will grow the economy and create jobs for
the future.
The Economic Secretary to the Treasury ()
It is always a pleasure to follow the hon. Member for Erith and
Thamesmead (). I thank all hon.
Members who have tabled amendments and contributed to today’s
debate, as well as those who made valued contributions in
Committee. Notwithstanding a certain number of amendments, I feel
that generally there is good consensus across the House about the
core purpose and objective of an important institution.
If we are fully to meet our responsibilities to spread
opportunity to all parts of the United Kingdom and support the
all-important transition to the clean energy economy, it is right
that we take bold action now with institutions such as the UK
Infrastructure Bank. We have therefore introduced the Bill to
make explicit—with a legislative lock, if you like—the scope of
the bank’s objectives
“to support regional and local economic growth”
and
“to help tackle climate change”.
Enshrining the bank in legislation will help to establish it as a
long-lasting institution. That is important to colleagues across
the House, as we have heard, who agree that it is a welcome
initiative. I am glad that there has been general consensus today
about the importance of the Bill.
I turn to Government amendment 1, which stands in my name. In
Committee, I committed to looking again at the frequency of
statutory reviews into the UK Infrastructure Bank and undertook
potentially to propose a different frequency at a later stage of
the Bill’s passage. It would be a gross mischaracterisation to
call the amendment a U-turn; it is simply an example of a
listening Minister in a listening Government trying to do what is
best to get the institution on the right footing. I thank hon.
Members who brought the matter to my attention and shared their
views, particularly my predecessor, my hon. Friend the Member for
North East Bedfordshire (), who raised the point in
Committee.
It is, I hope, a sign of strength that I considered afresh what
was appropriate for the first review period. However, given the
pre-existing reviews to which the Cabinet Office and HM Treasury
have already committed, and the need to allow a nascent
institution time to embed itself, I remain of the view—having
taken the question away and looked at it again—that it is right
for the first review period to be seven years. However, I
recognise the strength of the arguments for, the appropriateness
of and the desire for a shorter period between every subsequent
review to ensure that this House applies the necessary
accountability. My amendment 1 would therefore reduce the
interval between each regular review after the first.
Does the Minister remember rejecting our amendment about the
reviews? He is saying that this is not a U-turn, so I just want
to hear from him about that aspect.
I hope the hon. Lady would never dream of trying to score cheap
political points, as distinct from our good-natured and
collaborative discussions in Committee. Rather than setting a new
timeframe there and then, we looked at precedent in a quest for
the optimal timeframe. I undertook to come back on Report and
share a proposal with the House, precisely as I am doing today.
Having listened and having made that determination, I can feel
the warm radiation of support from the Opposition. I hope to see
that good will extending to supporting the rest of the Bill
without further amendment.
As it gets warm and huggy between the two Front Benchers, I would
like to remind the Minister that I also tabled an amendment in
Committee. I hope that he is feeling warm and huggy towards
Government Back Benchers as well. He seems huggy, though I am not
sure it is politically correct to say that any more. I want to
emphasise that the Minister has been listening, which is why he
has come back with the amendment. That is the right thing for him
to do.
The serious part of my point is how the institutional culture of
the bank is set. The Minister will know from his own experience
that the first few years are very important. He says that the
first review period will be seven years, and I understand that,
but can he share with the House some of his thinking about how
that responsibility will be balanced? I think Members on both
sides of the House are concerned that we set the institutions and
regulators out there a task, but then we do not have the time,
the information or the control to hold them to the original
principles that we have set. Does the Minister broadly agree with
that? Is he comfortable with the way the legislation will now be
framed?
Let me assure my hon. Friend and the whole House that this
institution will not lack the proper scrutiny. In that initial
set-up period it will be reviewed by both the Cabinet Office and
His Majesty’s Treasury. It will not lack scrutiny. It has an
obligation to report annually. On some of the amendments we have
discussed today, I have already procured a commitment from the
bank to put more information into the public domain about its
investments and their location, which Opposition Members have
rightly pressed us for.
Although the bank is yet to reach its full complement of staffing
and run rate of operations, it has already benefited from a
serious review by the Public Accounts Committee of this House. I
think it would be worth trying to correct some misapprehensions,
but I do not for one moment take away the importance of regular
scrutiny. We are talking about public money, and it is of the
utmost importance that we engender trust as well as good value
for public money.
That Public Accounts Committee report is a good and important
piece of work. I absolutely commend the work of the Committee,
which does a sterling job to protect the interests of taxpayers.
We should always remember our duty of care when we are spending
other people’s money. It is a good piece of work, and I am
grateful for it. We will respond to it in the usual way through
the Treasury minute process to get that on the record.
However, I want to address one or two of the points raised. The
report raised concerns about governance, but this is an
institution that has benefited from strong financial governance
from the get-go. All deals done to date have been reviewed by the
full UK Infrastructure Bank board before being approved. Because
of that, early deals were also approved by HM Treasury Ministers
to ensure that we protected taxpayers’ money.
I am proud, as we all should be, of the bank’s work as it
continues to engage with the market and across Government,
building on its first 18 months in which it has done 10 deals
worth more than £1 billion of additive, incremental investment
across all parts of the United Kingdom.
My hon. Friend has just used the magic word “additive”. Would he
care to explain further, in the context of these new clauses and
amendments, that the issue of additive capital is a crucial part
of the bank’s responsibility? This is not just about protecting
taxpayers’ money, but about attracting third-party private
capital. One of the points about the proposal to spread the
objectives is that it becomes harder to attract that capital when
the mission of the institution is more diffuse. The more focus it
has, and the more focus my hon. Friend has, the more likely we
are to achieve the objective of additive capital that he has
outlined so clearly.
15:30:00
My hon. Friend is, once again, absolutely right. The principle of
being additive is baked into the core charters and constitutions,
as well as the steer that my colleagues and I will give.
New clause 1 would insert a provision to prevent the sale of the
bank. I understand the concern that has been expressed by Members
in the past, but I can reassure them that the bank is intended to
be a long-lasting institution. I have detected a strong degree of
consensus about the importance of this, both in Committee and
here in the Chamber, just as our commitment to net zero is
long-lasting and a subject of consensus. We intend the bank to be
permanent; it is an essential part of the Government’s
infrastructure strategy. Moreover, the new clause is simply not
necessary. In the event that any future Government considered a
sale of the bank—and that is not my expectation—it would require
primary legislation at the time. The new clause cannot bind the
House on a future occasion, and in any event it is not necessary,
so I ask for it not to be pressed to a vote.
The hon. Member for Erith and Thamesmead has tabled a new clause
and an amendment. New clause 2 would require the bank to publish
an annual report addressing the geographical spread and ownership
of bodies in which the bank invests. That is, of course, its core
purpose, and I therefore do not think we need the new clause. We
debated this proposal in Committee and, for the reasons that we
set out then, we do not propose to accept it now.
The new clause is simply unnecessary, because the bank will
already be reporting on its investments: it will publish a
summary of them in its annual report and accounts. It captures
data in all its deal assessments, and will be happy to make them
publicly available. I have received a letter from the bank
confirming that it will make publicly available the names of
developers and/or sponsors of the projects it supports. It will
also provide the geographical location of these projects. I feel
pressed by colleagues on this matter. I have procured more
information, as the hon. Lady has requested and, again, I ask for
this new clause not to be pressed to a vote.
As for jobs, it is actions, not lines of statute, that count. We
do not need to deliver an amendment to deliver good jobs; just
ask the employees involved in the NextEnergy, Gigaclear and
Fibrus investments which the bank has already supported. Every
job is a good job. The bank is committed to pursuing the highest
environmental, social, resilience and governance policy
standards, and we do not feel that there is any added value in
simply adding extra lines of statute or red tape for the sake of
it, as the hon. Lady proposes. It is actions, not words, on which
we are focused.
Amendment 5 asks for the bank’s objective to include reducing
regional inequality and improving pay, productivity and living
standards, as well as supporting supply chain resilience.
However, those are already implicit in the bank’s current
objective. That is the very purpose of setting up a UK
infrastructure bank—the clue is in the name—and we now have a
track record to show what the bank is doing to support regional
and local growth.
Will my hon. Friend give way?
I will give way one final time, but my hon. Friend will have to
make it count.
I am not so sure about that, but I know that my hon. Friend has a
lot of reading to get through. As he obviously knows, part of
what is inherent in the net zero objectives is the fact that
there will be an increase in supply chain resilience.
My hon. Friend did indeed make his intervention count, because
that is a very pertinent point. Of course, the whole purpose of
the bank is infrastructure and capability building, and the
commitment to regions is at its heart. Regional and local growth
are among its core objectives. The more diverse infrastructure we
have in all parts of this great United Kingdom, the more we are
naturally adding resilience and achieving our objective. Indeed,
the strategic steer set by the then Chancellor in March last year
makes it clear that the bank must focus on geographic
inequalities by reference to the levelling-up White Paper, which
includes a comprehensive set of levelling-up objectives and
measures and supports the Government’s strategic approach to
levelling up. We would rather do that on a portfolio basis than
investment by investment, as proposed by the hon. Member for
Erith and Thamesmead.
Amendments 3 and 4, tabled by the hon. Member for Tiverton and
Honiton (), focus on the important
issue of water quality. This is an area where the Government do
not need any lessons. We are taking the lead in this matter, and
are taking the action that the hon. Gentleman’s party and its
leader failed to take in coalition. Sometimes one detects the
fervour of a convert, or even the working-out of some past guilt
about their failure to take action on water.
It is obviously delightful to have another Devon MP who cares
passionately about the environment, as did his predecessor. I
cannot help but wonder whether, if the Liberal Democrats were
serious about this, the Secretary of State for Energy and Climate
Change from 2012 to 2015 might have implemented some of these
things. Does my hon. Friend the Minister agree that there seems
to be a trend of creating opportunities for dodgy graphics and
social media content, rather than making serious changes to
legislation?
My hon. Friend makes an important point. It ill behoves a party
that aspires to be taken seriously as a force in British politics
to be all about clickbait, misleading graphics and half-truths,
rather than about, for example, the data, which show that
monitoring has increased from just 5% in 2016—a level at which it
would be wrong for anyone to characterise themselves as having
their arms around this long-standing issue—to more than 90%
today. I understand from my right hon. Friend the Secretary of
State for Environment, Food and Rural Affairs that it will be
100% by the end of this year. We are the party that is taking
action. We are the party that is finding the data, exposing the
conduct of the water companies and putting record investment into
the sector to solve this long-standing problem. We are the party
that provides the solution.
The hon. Member for Tiverton and Honiton needs to consider
whether he wants to be part of the problem or, as we all are,
part of the solution. One of his amendments is entirely
superfluous, as such a measure is already underwritten by the
objectives in the world-leading Environment Act 2021. Only
yesterday, we announced ambitious interim targets to deliver
those objectives in our environmental improvement plan. I believe
that the hon. Gentleman was in the Chamber for the statement that
preceded this debate. For that reason, we will accept his
amendment, because it sits within the actions that we are taking
and the commitments that we have made.
Finally, the amendment tabled by the right hon. Member for Dundee
East () would require explicit
consent from the devolved Administration before using powers
under clause 2(6) that touch on devolved competence. However, I
was pleased when his colleague, , the acting Finance Secretary,
wrote to me indicating that he was happy with the content of the
Bill, and would recommend that the Bill receive a legislative
consent motion. Last week, I was even more pleased—imagine my
delight—when the Scottish Parliament gave the Bill an LCM. The
right hon. Member for Dundee East will see that not just the
Government but his colleagues suggest that his amendment is not
required by the Government in Holyrood. As a result, I very much
hope that he will not seek to push it to a vote.
This is an incredibly important milestone and moment in
establishing a new national institution that will deliver real
social purpose and make an enormous difference to the lives of
our fellow citizens across the United Kingdom. Establishing it
today in statute will give the market greater certainty and
confidence, and encourage significant private sector investment
in all of the bank’s priority sectors. By partnering with the
private sector—by mobilising the life force of private capital,
the ferocious, problem-solving power of business—in areas that
might otherwise struggle to get the investment they require, we
will help speed up the transition to net zero and level up the
UK. With the exception of amendment 4, which I have indicated the
Government will not oppose, I hope Members understand the
reasoning—even if they do not agree—that I have set out as to why
we cannot accept the amendments and new clauses and that they
respect the time of the House and agree not to press them to a
vote.
I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 2
Businesses and bodies the Bank invests in
“(1) The Bank must publish an annual report setting out—
(a) the geographical spread of businesses and bodies it invests
in, and
(b) the ownership of the businesses and bodies it invests in.
(2) The Bank must prepare and publish a ‘Good Jobs’ plan for all
businesses and bodies it invests in, which requires the business
or body to improve productivity, pay, jobs and living standards.”
.—(.)
This new clause would ensure that the Bank considers the location
and ownership of the businesses and bodies it invests in and only
invests in businesses and bodies who create “Good Jobs” plans to
improve productivity, pay, jobs and living standards
Brought up, and read the First time.
Question put, That the clause be read a Second time:—
Division 170
01/02/2023 15:41:00
The House divided:
Ayes: 210
Noes: 271
Question accordingly negatived.
Clause 2
Objectives and activities
Amendment proposed: 5, page 1, line 14, at end insert—
“(i) to reduce economic inequalities within and between regions
of the United Kingdom, and
(ii) to improve productivity, pay, jobs and living standards.
(c) to support supply chain resilience and the United Kingdom’s
industrial strategy.”—(.)
This amendment would ensure that the Bank’s objective to support
regional and local economic growth includes reducing economic
inequalities within and between regions and improving
productivity, pay, jobs, and living standards. It would also
create a third objective for the Bank to support supply chain
resilience and the UK’s industrial strategy.
Question put, That the amendment be made.
Division 171
01/02/2023 15:54:00
The House divided:
Ayes: 212
Noes: 269
Question accordingly negatived.
16:05:00
Proceedings interrupted (Programme Order, this day).
The Deputy Speaker put forthwith the Questions necessary for the
disposal of the business to be concluded at that time (Standing
Order No. 83E).
Amendment made: 4, in clause 2, page 1, line 22, at end
insert—
“(4A) The Bank may only provide any of the support listed in
subsection (4) to water companies if they have produced a costed,
time limited plan demonstrating they are committed to preventing
discharge.”—(.)
This amendment would require water companies to have a costed,
time limited plan, demonstrating they are committed to preventing
discharges before they can receive investment from the UKIB.
Amendment proposed: 2, page 2, line 9, leave out “consult” and
insert
“gain the express consent of”.—(.)
This amendment would require the Treasury to gain the express
consent of the appropriate national authority before making
provision in regulations under subsection (6).
Question put, That the amendment be made.
Division 172
01/02/2023 16:06:00
The House divided:
Ayes: 41
Noes: 285
Question accordingly negatived.
Clause 9
Reviews of the Bank’s effectiveness and impact
Amendment made: 1, page 4, line 39, leave out “7” and insert
“5”.—(.)
This amendment would require reports (other than the first
report) following reviews of the Bank’s effectiveness and impact
to be submitted at intervals of not more than 5 years rather than
7 years.
Third Reading
16:19:00
I beg to move, That the Bill be now read a Third time.
The Bill will place the UK Infrastructure Bank on a statutory
footing and enshrine key aspects of it in legislation, ensuring
that the bank’s purpose is clear and enduring. It will enable the
bank to lend directly to local authorities and the Northern
Ireland Executive, and His Majesty’s Treasury will be able to put
the bank into funds. The Bill also guarantees a high standard of
transparency and accountability to this House.
The Bill will now enable the bank to be fully operational,
ensuring that its two strategic objectives are put into statute.
It marks the next chapter for the UK Infrastructure Bank as it
continues to develop operationally. Since the summer of 2021,
when the UKIB became operational, 10 deals worth close to £1.1
billion have been completed, including providing financing for a
new £500 million fund that could double the amount of
subsidy-free solar power in the UK.
The UKIB has a transformative potential that I know is recognised
and supported on both sides of the House. I would like to thank
my immediate predecessors, my right hon. Friend the Member for
Salisbury () and my hon. Friend the Member
for North East Bedfordshire (). I also thank the hon.
Member for Erith and Thamesmead () and her colleague the
hon. Member for Hampstead and Kilburn () for their appropriate
challenge, but also for the support they have given the Bill.
I would also like to put on record my sincere thanks and the best
wishes of this House to the UKIB, including its chair, Chris
Grigg, and its chief executive, John Flint, who have both done
such great work in establishing the UKIB to date. Finally, as is
customary, I would like thank my Bill team—Alex McBeath, Milly
Rainford and Lorna Cosgrave—along with those in my private office
at the Treasury, who have supported me ably throughout this
process.
I am honoured to have played a part in taking this Bill—one that
will deliver meaningful, material benefits for our country and
our constituents—through the House of Commons, and I commend it
to the House.
Question put and agreed to.
Bill accordingly read the Third time and passed, with amendments.
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