Commons Sitting of 10 May 2004

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
Oral Answers to Questions
  HOME DEPARTMENT
  The Secretary of State was asked—
  HOME DEPARTMENT

    Asylum Seekers (Benefits)
    Mr. David Kidney: If he will exempt from the arrangements for withdrawal of benefits from failed asylum seekers those whom his Department fails to remove from the UK within a reasonable time. [171316]
    The Minister for Citizenship and Immigration (Mr. Desmond Browne): The Government do not believe that failed asylum seekers should be provided with benefits or support from the state. Failed asylum seekers have had every opportunity to make their case and, importantly, have exhausted the legal process, but have been found to have no right to remain in the UK. Providing support to those who are not removed within a certain time would act as a perverse incentive for failed asylum seekers deliberately to frustrate removal. However, those failed asylum seekers who are destitute
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    and unable to leave the UK immediately for reasons entirely beyond their control can seek the provision of accommodation under section 4 of the Immigration and Asylum Act 1999.
    Mr. Kidney: I thank my hon. Friend for that reply, and it is a pleasure to see him in the position that he now has.
    When the Select Committee reported on the Asylum and Immigration (Treatment of Claimants, etc.) Bill, it said that the priority should be the removal of failed asylum seekers. Will my hon. Friend confirm that there is no official encouragement for the view that taking away benefits is a good enough job done and that removals are still the priority? If he does not like the incentive that I have suggested, is there one that he thinks is better?
    Mr. Browne: I thank my hon. Friend twofold—first, for his welcome, and secondly, for his question. He is right to place an emphasis on removal. After all, as I said in reply to the substantive question, those who have failed in their claim for asylum and who have had the opportunity to make their case have been found to have no right to remain in the United Kingdom. The Government's approach to support is part of a package of measures that are designed to improve our ability to be able to remove those failed asylum seekers. We have had conspicuous success in that regard, with removals now running at about twice the level that they were in 1997 and increasing.
    Alistair Burt: I, too, welcome the hon. Gentleman to his position. I have known his predecessors well.
    As the Minister knows, I paid a visit to the Yarlswood detention centre last week and saw a number of detainees and immigration officials. I was staggered by the number of pieces of paper and claims from detainees about the wrongful advice that they had received from those who had allegedly been advising them, whether in relation to

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    benefits, their status or anything else. Does he share our concern about that, and will he say how he intends to tackle the issue now that he has the opportunity?
    Mr. Browne: I thank the hon. Gentleman for his contribution. In the short time that I have been in the job, I have already had constructive discussions with him about matters relating to his temporary constituents, as I trust they will be, at Yarlswood. I know that he has recently visited there.
    The hon. Gentleman is right to identify the damage that is done not only to the system, but to individuals' expectations by inappropriate, improper and often misleading advice. Indeed, I am struck by the number of reports that I have heard from removal centres of not only legal advisers but others raising false hopes in the minds of the people detained. He will know that, with the help of the Legal Services Commission, we have been able to make significant improvements to the quality of the service that has been provided. He will also know that there are provisions in the Bill that is currently before the other place in relation to legal aid, which is an important part of the process. If those provisions are enacted, they will improve the quality of that advice.
    Mr. Stephen McCabe: I agree with my hon. Friend the Member for Stafford (Mr. Kidney) that we need the rapid removal of failed asylum seekers. Is not the real sense of grievance and outrage directed at the judges who persistently seem to favour those who seek to thwart our entitlement rules at the expense of the very people in this country who have to pay for it all?
    Mr. Browne: My hon. Friend makes a point in relation to criticism of our judiciary to which I do not think he would expect me, as an Executive Minister, to respond from the Dispatch Box. My responsibility as a Minister is to ensure that we are properly equipped to make our arguments before the courts, to explain the law as passed by Parliament and to ensure that it is enforced. For so long as I have these responsibilities, I will seek to discharge them.
    David Davis: May I crave your indulgence, Mr. Speaker, and welcome the Minister to his position? I hope that it is not too harmful to him to say that, the instant that he was appointed, I was approached by Lord Brooke, the previous Secretary of State for Northern Ireland, to tell me how intelligent, straightforward and energetic the Minister is. He will need all those attributes in his new task.
    To return to the question, the confusion of the policy is unsurprising given how the Government create policy. One category of asylum seekers are those from eastern Europe, who are now covered by a new set of regulations that were laid before Parliament only days before they came into force on 1 May. The relevant Committee of the House of Lords said:
    "The need for these regulations has been known for some time: the decision of the Government to open United Kingdom borders to workers from all Accession States from 1 May was announced in December 2002. In view of this, the House may wish to invite the Government to explain why the regulations were not laid sooner."
    What is the Minister's answer?
    Mr. Browne: I am very grateful to the right hon. Gentleman for his welcome, which he coupled with remarks by Lord Brooke. That delighted me even more. Lord Brooke is someone with great erudition, humanity and humour. Indeed, he may have been exercising his humour when he phoned the right hon. Gentleman. If Lord Brooke's regard for me is high, it is surpassed only by my regard for him. However, with the pleasantries over, let us go to battle.
    First, the right hon. Gentleman consistently conflates the two issues of immigration and asylum. I am never sure whether he does that deliberately or accidentally, but the more he does it, the more I am persuaded that he does it deliberately. If that is the case, it is dangerous for social cohesion in this country.
    Secondly, there is no second category of asylum seekers. The right hon. Gentleman well knows that people were seeking asylum in this country at the point of accession and we are obliged to continue to process those applications in relation to the convention and our laws if they do not wish to withdraw them. They will be treated in exactly the same way as all other asylum applications.
    Thirdly, the right hon. Gentleman mentioned the timing of the regulations in relation to the workers registration scheme. As he knows, the most important thing about turning up for a play is to be there when it starts. In this case, the play did not start until 1 May and the regulations were fully in place.
    David Davis: It is unsurprising that the Minister has learned the habits of the Home Office quickly and did not answer the question. The late delivery reflects the complete shambles of the Government's immigration and asylum policy. It is such a disaster that their own Social Security Advisory Committee said of the regulations:
    "We recommend that the proposals in their current form should not be proceeded with."
    How does the Minister explain this disaster?
    Mr. Browne: If the right hon. Gentleman writes his supplementary questions before he hears the answer, he has the problem that they bear no relationship to the answer. I answered every part of the question that he asked me. If he checks the record tomorrow, he will see that that is the case.
    On the package of regulations, of course the Social Security Advisory Committee had the opportunity to consider the benefits regulations and to have an opinion on them. The House had the final opinion, however. If it is the right hon. Gentleman's view that the regulations are as set out in the Social Security Advisory Committee's report, he knows exactly what he should do about it.
    Glenda Jackson: Is it not the case that the speed of removal of a failed asylum seeker is not exclusively the responsibility of the Home Office, but relates also to the fact that the receiving country's officials are extremely slow to undertake their paperwork? In both instances, the failed asylum seeker has no responsibility whatever. Surely it is

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    wrong to penalise not only the asylum seekers but, most markedly, their children by removing support and possibly shelter.
    Mr. Browne: I am grateful to my hon. Friend for giving me the opportunity to explain that we do not remove support in those circumstances. She is right to point out that our ability to remove asylum seekers, especially to their countries of origin, is often a function of our ability to get those countries to redocument them to enable them to travel. That is why the Prime Minister is today discussing that very issue with the Premier of China.
    Mr. Mark Oaten: I also welcome the Minister to his new post. If he has a chance, will he look again at the Government's plans to remove benefits from the children of asylum seekers, planned under the Asylum and Immigration (Treatment of Claimants, etc.) Bill? Given last week's U-turn on the right to appeal, is it not also right to have a U-turn on this draconian measure? Given that the right to appeal has gone, the removal of this measure may enable him to get cross-party support for the Bill.
    Mr. Browne: I am grateful to the hon. Gentleman for his welcome. I have read the record of the debates on this issue, which was recently debated in the other place, and I know that he understands the Government's position. If an asylum application has failed, people should return to their home if they are free to do so. It would be a dereliction of our duty to those people whose asylum applications succeed and move on to refugee status, and to our ability to provide that level of refuge in future, if we did not have rules about the cut-off point.
    Let us take as an example those people whom the right hon. Member for Haltemprice and Howden (David Davis) chose to question me on, whose countries are now members of the European Union and have reached the threshold in relation to human rights that allows them to join the European Union. What does the hon. Member for Winchester (Mr. Oaten) want the Government to do about them? He wants us to remove them. If the impediment to the removal of those people is their own behaviour, why should the taxpayers of this country support them?

    Abandoned Cars
    Syd Rapson: What plans his Department has to encourage the police to deal with abandoned cars. [171317]
    The Parliamentary Under-Secretary of State for the Home Department (Caroline Flint): As part of our Together initiative on antisocial behaviour, which is one of the No. 1 issues for the people of this country, we have tackled abandoned cars by introducing stronger, tougher measures, including the opportunity to remove cars within 24 hours. We are working to improve that by supporting trailblazers to share best practice and show that the police, along with other agencies, have a key role to play.
    Syd Rapson: I thank the Government for ensuring that, at last, we have good legislation that benefits areas
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    such as mine, but there is a problem. Will the Minister consider giving the police extra powers to deal with cases where an unscrupulous driver abandons his vehicle in somebody's private driveway? The local authority ignores such vehicles because they are not on public land and the Driver and Vehicle Licensing Agency will not get involved because they are not on the highway, so the police end up having to do something. The owner of the private driveway, who is innocent in all this, has to pay £30 to have the vehicle removed. The issue seems to be going round in circles. Can we close that loophole and make our good legislation better for everyone?
    Caroline Flint: My hon. Friend makes a good point about some of the problems caused by vehicles being abandoned on private land. The first is establishing whether the vehicle has been abandoned. The local authority can put a notice on the car and if, after 15 days, it has not been claimed it can take action to remove it. Other measures are available if the car is claimed by the owner: it is possible to use powers provided by environmental and waste legislation and, in certain instances, antisocial behaviour legislation. I ask my hon. Friend to get in touch with me about the particular problem that he mentioned, and I will ask the antisocial behaviour unit to look into it. We are cracking down on such behaviour wherever it occurs, and we know that that is important because our people tell us so.
    Mr. Robert Key: Does it not depend on what one means by "abandoned" and "deal with"? Will the Minister call for a report from chief constables on a practice that is causing distress throughout the country? I refer to cases in which a vehicle is stolen and then abandoned many miles away, the police then telephone a company to remove the vehicle from the highway, and the company then charges the person from whom it was stolen. In normal circumstances, the police would phone up the owner, who would then go and get the vehicle, but in these cases many people are being treated very harshly by the police.
    Caroline Flint: The hon. Gentleman makes a fair point. The police should be sensitive to these issues and we should investigate whether insurance would cover the costs. I think that he would acknowledge, however, that in dealing with abandoned or stolen vehicles and those without tax or insurance we are using antisocial behaviour powers from legislation that the Liberal Democrats voted against in its entirety—and we are investing money that the Conservative Opposition plan to take away. By using automatic number plate recognition and other measures we are making sure that the people who drive on our roads are safe and that they are legally entitled to do so.
    Brian White: My hon. Friend will be aware that action taken by a parish council in my constituency to remove abandoned vehicles was thwarted because a member of the local authority said that the land in question was public open space, not highway, so the parish council had to return the abandoned vehicles to the site. What advice is the Home Office giving to councils so that jobsworths cannot prevent the strong action that is required to deal with abandoned vehicles?
    Caroline Flint: We are providing local authorities with a number of powers to deal with that problem. We have extended their access to the DVLA registration database and we have given them powers, including wheel clamping, that were once the preserve of the DVLA. We are saying, "Here are the powers. It's a no-can-do situation. Get on with it."
    Sir Sydney Chapman: Will the Minister make it plain to the police and local authorities which of them is responsible for removing abandoned vehicles? I have certainly had cases in my constituency in which the police say that it is the responsibility of the local authority and vice versa. I understand that, two years ago, local authorities removed almost 300,000 abandoned vehicles. Will the Minister give the House the latest figure and confirm that it is likely to rise considerably when the appropriate EU directive comes into force in, I think, 2006?
    Caroline Flint: The responsibility lies with many agencies, which is why we have given powers to take action to local authorities as well. The Removal and Disposal of Vehicles Regulations 1986 give the police the power to remove any vehicle that is in breach of local traffic regulation orders, causes obstruction, is a danger to the public, is broken down or is abandoned. We have brought local authorities into the partnership and they, too, can take action. It is part of the national policing plan to ensure that police understand the issues surrounding antisocial behaviour, including graffiti, abandoned cars and the dispersal of groups of youths who are causing intimidation and harassment. That is all part and parcel of policing today, but we have a wider police family to help us to achieve the end results.

    Domestic Violence
    Vera Baird: What his plans are to tackle domestic violence and to bring more perpetrators to justice. [171318]
    The Parliamentary Under-Secretary of State for the Home Department (Paul Goggins): Domestic violence is an horrific crime, which affects one in four women and causes the death of two women each week. The Domestic Violence, Crime and Victims Bill is the biggest overhaul of domestic violence legislation for 30 years. It includes a range of measures that will provide additional protection and support for victims and help to bring perpetrators to justice.
    Vera Baird: I thank my hon. Friend for that answer and congratulate him on the Bill. Is he aware of the work of local domestic violence advocacy services, which attach a worker to every domestic violence sufferer who rings the police to help that person through benefit changes and all that can follow a complaint, and to support that person through the justice system, upping the courts' success rate quite significantly and very cheaply? Will he consider piloting such services more widely?
    Paul Goggins: I thank my hon. and learned Friend for her positive welcome for the Bill. I congratulate her and other members of the all-party group on domestic
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    violence on the tremendous work that they have done to bring such issues to the attention of the House. Following February's joint inspection report, we are looking closely at the role of local advocates: we see that the idea has merit, and we want to assess it further. I fully endorse her comment about the need to support victims of domestic violence through the whole process. The practice and philosophy of the Crown Prosecution Service and the police has been transformed in recent years, so that victims of domestic violence are much better supported than they used to be.
    Mr. Henry Bellingham: How many convictions were there last year and the year before, and how many does the Minister think there will be once the legislation is in place?
    Paul Goggins: The hon. Gentleman needs to be slightly more precise about which charges he is inquiring about. We will implement a range of measures under the Bill, including extending the availability of restraining orders and non-molestation orders and making common assault an arrestable offence. Such measures will bear down on domestic violence and make sure that its perpetrators are dealt with severely. I hope that those on both sides of the House will support that approach.

  Community Support Officers
  Siobhain McDonagh: How many community support officers there are. [171319]
  Dr. Nick Palmer: How many community support officers are operating.
  The Secretary of State for the Home Department (Mr. David Blunkett): At the end of April this year, we had more than 3,500 community support officers in 38 police force areas. They provide complementary support with the uniformed police. whose number has risen by 6,000 in the past year alone. They concentrate on the low-level violence, antisocial behaviour and nuisance behaviour that blight the lives of so many of our constituents. They make a vital contribution to the provision of high-visibility and high-accessibility patrols, free police officers for other duties and give reassurance to communities.
  That record flies in the face of the claims that the policy would be a failure, that forces would not take it up, that the police would not welcome it and that local communities would reject it. Those claims were simply untrue and the Opposition parties, in particular the Liberal Democrats, were entirely wrong—as they usually are.
  Siobhain McDonagh: I thank my right hon. Friend for his answer. I concur with him on the benefits provided by police community support officers in my constituency and. I am sure, in every constituency that is lucky enough to have them. Lucy Heddon, chair of Glebe Court tenant management organisation, said today that, in the short time that they have been in post, her local PCSOs, Mick and Terry, have transformed her life and that of other people on her estate because they

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  are available at night, they are a high-visibility presence, and they are there to tackle the small misdemeanours that were ignored in the past.
  The problem in outer-London, however, is that PCSOs are paid outer-London weighting, while just up the road, they receive £1,500 more for inner-London weighting. Those rules do not apply to ordinary police officers. Surely that could be extended to our PCSOs, because we need to retain the likes of Mick and Terry currently working in Mitcham.
  Mr. Blunkett: I concur strongly with my hon. Friend's example. There must be a boundary in terms of outer and inner zones and payments, and although an additional £1,350 is paid to officers in Merton, that does not compare with what is paid in the inner boroughs. I appreciate that that is a real challenge. The good news for my hon. Friend and her constituents is that another 10 community support officers are coming out of training at Hendon and will be employed in Merton in two weeks' time. That will be a considerable improvement and a great tribute to my hon. Friend, who has campaigned vigorously on this matter and against antisocial behaviour in Mitcham and Morden.
  Dr. Palmer: Does my right hon. Friend accept that in Broxtowe we are extremely enthusiastic about our CSOs and we hope that the application for further CSOs made by Nottinghamshire police will be successful? Does he share my concern that other parties might seek to abolish this post? Will he consider creating a good long-term career structure for police community support officers, because those to whom I talk hope in the long term to work in the police force? I am a little concerned that the best people in the CSO force will be promoted to the point at which they are no longer working on the beat. Will he try to ensure that we provide a good career structure so that that does not happen?
  Mr. Blunkett: I, too, hope that we can add to the 62 CSOs currently employed in the Nottinghamshire force, and the third round is being evaluated at this moment. I share the challenge to ensure that people who are recruited can have a long-term career path. Many choose to become uniformed officers, which is good in terms of diversity because the number of people of ethnic minority origin and women coming through from the CSOs is much greater than in recruitment to the police service as a whole. I agree entirely with my hon. Friend that it would be a terrible tragedy if, for instance, a party cut more than £660 million out of the Home Office budget, and if community support officers were done away with as a result.
  Mr. James Gray: The Home Secretary, of course, repeats an oft-quoted error by suggesting that any such cuts will be made by the Conservative party when it comes into government in about a year from now. Will he comment on the funding of community support officers? I am the first to support the community support officer who is doing good work in Chippenham, and I hope that the chief constable will recruit the second one for whom she is currently advertising. However, is not the difficulty that the funding from the Home Office lasts for a total of only four years, and after that contributions from town
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  councils and parish councils across the patch will be required? The cost of community support officers will be transferred from the Home Office to the unfortunate council tax payer, who is already screaming.
  Mr. Blunkett: Let us be absolutely clear: a whole range of individuals and organisations have joined together to supplement the amount that has been provided, both through direct funding for CSOs and through the general police grant. We cannot have two different versions of the same budget from the Opposition. Either the Treasury spokespeople for the Conservative party are right or they are wrong when they say that there will be necessary pain in reducing budgets. When that budget is applied across the board, other than to schools and the NHS, it is inevitable that there will be cuts. Under our proposals, however, and under the forthcoming spending review, there will be additional resources to pay both for additional CSOs and for the continuing rise in the police service, which has shown an increase of 6,000 in the past year alone. With a Conservative budget, cuts would be bound to occur in every part of our service and every part of our country.
  Mr. James Paice: The Home Secretary knows full well that a Conservative Government will add 40,000 police officers. What is more, we will tell police authorities that they can choose whether to spend the money on CSOs or on real police officers. That is real local accountability.
  Can the Home Secretary tell us about training for CSOs and how much they have had? Can he confirm that the length of training can vary from just one week to five weeks or more, whereas basic training for real police officers is being cut from 15 weeks to 12? Is it any wonder that people suspect that the Government have a hidden agenda to de-skill policing and use CSOs on our streets to replace real police officers?
  Mr. Blunkett: I am very happy to let the hon. Gentleman into a secret: we do have a hidden agenda. It involves providing thousands more CSOs and thousands more police officers at the same time, and decentralising training from the current residential arrangements so that people can be nearer to home and get more into the three months' training for uniformed officers. That is being welcomed by the Police Federation and the Association of Chief Police Officers.
  We have heard the comments of the shadow Home Secretary, the right hon. Member for Haltemprice and Howden (David Davis), on the budget for the 40,000 extra police officers. That was to come from the abolition of the immigration and nationality directorate, but when we announced a month ago that we were going to reduce headquarters costs, the right hon. Gentleman said that that was an outrage and a disgrace. He will not even help us to reduce the administration costs, let alone switch the whole budget into paying for the police force.
  Mr. Martin Salter: The Home Secretary will know that the Police Federation objected vehemently to the introduction of community support officers. Wherever I go, I hear police officers saying what a valuable task CSOs perform on the streets of their

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  areas. Has the federation formally withdrawn its objection, or has it eaten a little bit of humble pie recently?
  Mr. Blunkett: My hon. Friend will forgive me: as I am to visit the federation in two weeks, I shall not ask it to eat anything. I shall, however, ask its members to join us in welcoming the extra police officers, the extra CSOs, the extra powers against antisocial behaviour, the introduction of the Criminal Courts (Sentencing) Act 2000—all the elements that we are putting into a jigsaw to provide the powers, legislative backing, resources, and manpower and womanpower to make it possible to clean up our streets and give people safety in their homes.

  Children (Sexual Exploitation)
  Mr. Shaun Woodward: What his plans are to combat the trafficking and sexual exploitation of children within the UK; and if he will make a statement. [171320]
  The Parliamentary Under-Secretary of State for the Home Department (Fiona Mactaggart): The Sexual Offences Act 2003, which came into force on 1 May, includes offences that criminalise trafficking into, within and out of the country for the purpose of sexual exploitation. The offences carry a maximum penalty of 14 years imprisonment. The Act also introduces comprehensive offences covering the sexual exploitation of children.
  Mr. Woodward: The provision of safe accommodation for children who are victims of this appalling trade is essential if we are to break the cycle and protect children more. It is also essential because a trade that is estimated to be worth $7 billion a year requires us to do all that we can. Given the Government's commitment to establishing a safe house, and the establishment of Integrated Care's first safe house for these children, what proposals have the Government to support them further and to expand the safe houses service?
  Fiona Mactaggart: I thank my hon. Friend for his question and for his determined pursuit of this issue. We know of the new safe house established by Integrated Care and believe that it provides an important service to which all local authorities can refer children. It is for local authorities to decide how best to discharge their responsibilities to children in need under the Children Act 1989—some choose services of this kind, while others opt for foster care or other provision—but I am certain that the safe house will be a useful resource for social services departments to consider when dealing with trafficked children. Our new legislation will ensure that children in such circumstances are given better protection.
  Mr. Hilton Dawson: Does my hon. Friend agree that it is essential for joint working to take place between the immigration service, the police and social services at every port—and I mean every port in the country—to ensure that children who may be being trafficked are identified at that crucial
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  stage, that they are given all possible help, and that all possible work is undertaken to deal with those who are trafficking them into the country? Will she have further discussions with the Minister for Children to ensure that that crucial aspect of joint working goes ahead based on the best practice available?
  Fiona Mactaggart: I thank my hon. Friend, and I note his continued commitment to the issue. I think that, like me, he will welcome the additional work that has come out of the Sexual Offences Act 2003: tough new offences, better collaboration between social services and immigration, action to prevent the problem by working with source and transit countries and, as he pointed out, other appropriate support for victims. We are working across key agencies at principal entry points to identify children at risk. Operation Paladin has just been concluded. It involved a range of different authorities dealing with unaccompanied children, or children accompanied by someone other than their parents, to see what situation they are coming to and what the child protection issues are. We will be learning the lessons from that. Child victims of trafficking are likely to need welfare services and, in many cases, protection under the Children Act 1989. We look forward to working with our colleagues in the Department for Education and Skills to ensure that that happens.

  Prison Capacity
  Ross Cranston: What assessment he has made of the impact of the long-term prison population projections on prison capacity. [171321]
  The Parliamentary Under-Secretary of State for the Home Department (Paul Goggins): It is estimated that a continuation of recent trends in the use of custody would result in a prison population of 93,000 by the end of the decade. The reforms that we are making should enable us to rebalance the system and achieve a stable and lower population. As a result of the investment that we are making, there will be 79,500 available prison places by 2006.
  Ross Cranston: I know of my hon. Friend's personal commitment to prisoner welfare. The Criminal Justice Act 2003 means that there will be more robust community sentences and a reduction in the number of short sentences, which are ineffective in reducing wrongdoing. but there is concern out there that the increase in the number of prisoners and the small number of new places coming on stream make the situation unsustainable. Can he give an assurance that that pressure will be relieved in the near future?
  Paul Goggins: My hon. and learned Friend is right to point to that pressure. We will continue to expand the capacity of prison places. By next year, we will have 77,600 prison places. By 2006, we will have 79,500 places. He is right to point out that many very short prison sentences are a waste of time. They are long enough for people to lose their homes and jobs but not long enough to do the resettlement and educational work that such

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  prisoners need. It is far better for non-dangerous offenders, particularly first-time offenders, to be dealt with in the community with a robust community sentence.
  Mr. John Bercow: Given the projected increase in the prison population and the urgent need to cut recidivism, the hon. Gentleman will certainly agree, as he has just indicated, that prison education must be a top priority. In that context, what proportion of people currently leaving prison still can neither read nor write and what is the Government's public service agreement target for improvement in that regard?
  Paul Goggins: What I can say to the hon. Gentleman, and I am sure that he will be pleased to hear this, is that, as this has been an area in which the Government have invested, we have seen a significant increase in the number of people who learn to read and write while in prison. The most salient point is that, last year, 50,000 basic skills qualifications were gained in our prisons. Those prisoners can now read and write, take their place in society and reform their behaviour.
  Mr. Neil Gerrard: My hon. Friend will know that one of the key objectives of the National Offender Management Service was to reduce the projected figure from 93,000 to 80,000 by the end of the decade. Can he tell us exactly how he expects NOMS to do that, because it is not NOMS that will be in charge of sentencing policy, but the Sentencing Guidelines Council?
  Paul Goggins: My hon. Friend is right. In the end, it is not politicians or legislators who send people to prison, but sentencers. That is why the role of the Sentencing Guidelines Council will be central to our reforms. The chief executive of the National Offender Management Service has a key role to play in informing the council about what is effective in sentencing. The NOMS will provide, for the first time, effective management of offenders through the whole system, joining the bit of the sentence served in prison with the bit served in the community. By doing that, we believe that we will further reduce reoffending rates.
  Mrs. Cheryl Gillan: The Minister is responsible for planning for the prison population. So serious is the overcrowding in our prisons that 64 per cent. are over the limit for keeping prisoners in decent conditions and 15 are over the danger line for safety as we speak. There are more suicides and self-harming by prisoners and the justice unions report increases in acts of organised indiscipline, hostage situations and threats. What is the Minister going to do about this shambles of Government policy? Will he speed up the prison building programme, or will he rebalance the programme by letting more and more prisoners out early to join the 1,100 who have committed further crimes while under curfew orders?
  Paul Goggins: Those figures are not correct, but I welcome the hon. Lady's concern for the welfare of the people in our prisons. For example, it is welcome that she is concerned about the number of people who committed suicide in our prisons last year. I hope,
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  therefore, that she will join us in supporting the strategy that I put in place for reducing self-inflicted deaths in custody. But services such as that cost money and given she and her colleagues want to wipe £700 million out of the budget of the Home Office, where would that money come from? I have set out our prison-building programme and the extra places that we intend to provide, but that costs money. We will provide it and she would not.

  Designated Public Places Orders
  Mrs. Anne Campbell: What assessment he has made of the effectiveness of designated public places orders. [171322]
  The Parliamentary Under-Secretary of State for the Home Department (Fiona Mactaggart): The effectiveness of DPPOs is being monitored and evaluated in the trailblazer areas that are focusing on tackling the antisocial street scene. Those areas are Camden, Westminster, Brighton and Leeds. As of March, around 100 authorities have been operating the system successfully. This indicates that they have been found useful.
  Mrs. Campbell: What would my hon. Friend say to the Liberal Democrat leader of Cambridge city council who, despite petitions requesting DPPOs totalling thousands of signatures, has refused to use the legislation on the grounds that it is, he says, impractical and illiberal?
  Fiona Mactaggart: I would say that he was a hypocrite. I have noticed the eagerness with which his Liberal Democrat colleagues in election campaigning have said that they would crack down on the yobs. We know from the British crime survey that 44 per cent. of all victims of violent crime describe their assailant as being under the influence of alcohol at the time. Yet, in practice, when we provide effective tools to deal with exactly that problem, they fail to use them. Typical.
  Jonathan Djanogly: Has not the hon. Member for Cambridge (Mrs. Campbell) provided a first-class example of how the Government's proposals to control violent and drunken youths—while perhaps well meaning—have failed because the cost, red tape and hassle involved in getting antisocial behaviour orders, curfew orders and now designated public places orders mean that, despite the Government's spin, most councils do all they can to avoid using them?
  Fiona Mactaggart: The world that the hon. Gentleman describes is not the one in which I live. I have noticed how our efforts to ensure that we slim down the things that need to be done to obtain an ASBO—as well as our work on the availability of interim orders—have meant that, where there is a dynamic and effective partnership between the local authority and the police, the order is a useful tool for dealing with antisocial behaviour. At last, we have the methods to tackle the problem, but I am not surprised that the hon. Gentleman and other Opposition Members are determined to put it down. They are wrong; they should

  15
  welcome these powers, like the people of Britain in the communities that are the victims of antisocial behaviour.
  Mr. George Howarth: Will my hon. Friend join me in congratulating Inspector Frank Firth in my constituency, who has successfully used those orders on several occasions to great effect, which has been welcomed by local residents? Does she agree that the one further development that would be welcome would be the courts underpinning those orders by using custodial sentences to reinforce them when necessary?
  Fiona Mactaggart: I thank my hon. Friend for his question. I apologise to the hon. Member for Huntingdon (Mr Djanogly), whom I should have welcomed to his new place. I got carried away and I hope that the House will forgive me for my enthusiasm on this occasion.
  My hon. Friend the Member for Knowsley, North and Sefton, East (Mr. Howarth) pointed out that, in his constituency, that power is being effectively used because of the determination of his local police service. Where there is effective collaboration between the police and others, it is a very useful power indeed. I agree with my hon. Friend that it depends on the effective use by courts and sentencers of their powers, and I am glad to see the participation of magistrates and others in some of the academy events and other "Together" events that are being organised to support the antisocial behaviour strategy. They are part of a partnership to deliver an effective clampdown on antisocial behaviour and drunkenness in our communities.

  Binge Drinking
  Mr. Ben Chapman: What measures he proposes to combat antisocial behaviour caused by binge drinking. [171323]
  The Secretary of State for the Home Department (Mr. David Blunkett): On 15 March, we launched our alcohol harm reduction strategy. Taken together with the new slimmed-down antisocial behaviour orders, the dispersal and curfew powers and the ability to levy fixed penalty notices, we believe that the new clampdown by Paul Evans, the head of the standards unit in our Department, will help to tackle head-on under-age drinking, binge drinking and chronic drinking. He will be able to assist us with all that from his experience as police chief in Boston, where he had tremendous success in turning a city with a major problem of violence and alcohol abuse into a city that is now, as I found when I was there at the beginning of March, easy, fit and clean to walk in.
  Mr. Chapman: Notwithstanding all the measures that have been put in place, antisocial behaviour by young people, fuelled by alcohol, remains a major problem in Wirral, South. It causes mayhem, from the knocking off of car badges to the knocking down of gravestones and the wilful destruction of bus shelters and telephone kiosks. That all creates a climate of fear and, in effect,
  16
  no-go areas at night for some of my constituents. What further measures could be put in place to free my constituents from that scourge?
  Mr. Blunkett: I do not disagree at all with my hon. Friend: this is a scourge. About one third of those who are arrested in town and city centres have been involved in alcohol abuse and more than two fifths of those involved in violent crime have been indulging in the overuse of alcohol. That is a major scourge. However, it is not only the legislation or enforcement measures that I have already enunciated that are crucial; also crucial are the partnership with the industry that produces and retails alcohol and a change in the education process, along with the sensible use of family pressure. We also need to give a message to those who give planning consent for large volume, or vertical drinking, establishments, to get across that there is a need for social responsibility from the business and commercial community as well as from everyone else—[Interruption.] Yes, vertical drinking often leads to horizontal sleeping and, unfortunately, too many people stagger out on to the street to cause mayhem before they do fall asleep.
  Mr. Mark Field: In the blizzard of announcements and initiatives in the Home Secretary's answer to the hon. Member for Wirral, South (Mr. Chapman), there was no mention of the Licensing Act 2003. How does the right hon. Gentleman feel that the introduction of 24-hour drinking under that Act will improve the Government's record on binge drinking and antisocial behaviour?
  Mr. Blunkett: The guidance that we have established between the Home Office and the Department for Culture, Media and Sport makes clear the powers that are available and the restrictions that should be put in place and, under the Anti-social Behaviour Act 2003, there is now the ability to close establishments immediately there is a problem. The lessons learned from Scotland and the evidence from across the continent were the driving force behind the Licensing Act, and I thought that there had been varying degrees of support from all parties in the House for the experiment of trying to ensure that people drink sensibly over a longer period. I would also advocate that they eat more while drinking at the times of day when drinking is most likely to cause abuse, inconvenience and damage to other people. [Interruption.] To judge from some of the heckling, it sounds as though one or two people probably indulged a bit at lunch time.
  Judy Mallaber: Binge drinking and social disorder in town centres as a result of drinking were among the major issues raised in a big conversation event concerning community safety that I held last week. Two specific issues were raised, one about planning and the proliferation of licensed premises, and the other about the responsibilities of licensed premises, some of which have totally irresponsible promotions such as, "All you can drink for £10" and "Two drinks for the price of one." Is there anything that could be done about the responsibilities of the drinks industry?
  Mr. Blunkett: Following the announcement on 15 March, the Prime Minister established a forum in

  17
  which representatives of the industry are being invited to come and talk through the measures that the industry is prepared to take to act responsibly. In the end, of course, if it does not do so, and if those very large premises, and the consequent antisocial behaviour that spills out on to the street, persist, we shall inevitably have to seek further powers. It is therefore in the best interests of all those involved in the industry, tourism and entertainment to be prepared to make themselves available as partners rather than opponents and ensure that we all gain from sensible drinking and entertainment and from city and town centres that are free and secure to walk in at night.
  Dr. Vincent Cable: Following the Home Secretary's trenchant comments on the retail sector, can he explain why, since 1997, an average of only 12 prosecutions a year have been brought against landlords for maintaining disorderly premises?
  Mr. Blunkett: First, the powers for immediate closure were not available, so the bureaucracy that has been referred to in other contexts this of afternoon often got in the way of the police and the Crown Prosecution Service when they tried to pursue such matters. With the new measures, including those involving licensing and planning, it will be possible for both the police and environmental health departments to intervene. Local authorities that become licensing authorities will be able to respond to their local communities, so it really will be up to local councillors—including Liberal Democrat councillors who so vehemently rejected the Anti-social Behaviour Act 2003, but who are so keen on putting out leaflets to pretend that they did not—to take action on behalf of their local electorate.

  Community Safety
  Huw Irranca-Davies: What assessment has been made of the impact of partnership working on community safety in police authority areas since 1997. [171324]
  The Parliamentary Under-Secretary of State for the Home Department (Caroline Flint): Partnership working is essential for ensuring the safety of our communities. Her Majesty's inspectorate of constabulary, jointly with the Local Government Association, Ofsted and the social services inspectorate, have inspected agencies within community safety partnerships, as has the Audit Commission. It was confirmed that substantial progress had been made. More needs to be done, but we are helping to reduce crime.
  Huw Irranca-Davies: Does the Minister agree that one of the greatest achievements of the Government is that we have extended community safety beyond mere policing to the wider community? Does she therefore share my dismay that when I attended the Nant-y-Moel neighbourhood watch the other evening, the more than 25 people there were not aware of the great powers that we have passed to them? Does she agree that, to paraphrase Citizen Smith, we have given the power to the people but some of them do not know about it?
  Caroline Flint: It is always distressing to hear of such things. My hon. Friend had a visit not so long ago from
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  my noble Friend Baroness Scotland and I understand that the partnership in his constituency is working better. However, there is no excuse for those involved in such partnerships not making themselves aware of the powers available. We have produced good practice guidelines and a new unit is looking at performance and support to ensure that the highest standards can be reached everywhere. We will consider intervening in areas that are not using the powers that are clearly available to them. This is an important issue and people deserve to have such powers used on their behalf.
  Mr. Edward Garnier: The Minister will perhaps agree that the expression "the impact of partnership working on community safety" is pretty meaningless. What is important to my constituents—particularly those in South Wigston, which is the least well off part of my constituency—is that youngsters engaged in binge drinking, to whom the hon. Member for Wirral, South (Mr. Chapman) referred a moment ago, are kept out of shops selling drink and off the streets. For the second time in five years, I shall address a conference in my constituency on antisocial behaviour. What we would like—I hope that the Minister can help us to achieve this—is more police officers patrolling the streets of South Wigston and more community support officers. They provide a uniformed presence and deter youngsters from misbehaving in public places.
  Caroline Flint: I am glad to hear that the hon. and learned Gentleman has made it to his constituency twice in five years. He argues for more police and community support officers, but this Government have delivered in that regard. What are required are resources and an attitude that recognises that tackling crime today is not only a matter for the police. It is also a matter for local authorities and, where drugs are concerned, for primary care trusts and others involved in that issue. We want more police officers, community support officers and others, but we will get them under a Labour Government and certainly not under a Conservative one.

  National Offender Management Service
  Mr. David DrewWhat assessment he has made of the likely budgetary impact of the creation of the National Offender Management Service. [171325]
  The Parliamentary Under-Secretary of State for the Home Department (Paul Goggins): The National Offender Management Service will become operational on 1 June with an overall budget of £3.5 billion. As with all other areas of public expenditure, the current spending review will determine funding levels for 2005–06 to 2007–08.
  Mr. Drew: As my hon. Friend will be aware, several hon. Members will address a mass lobby of probation officers tomorrow. Those officers are worried about the rush to introduce the National Offender Management Service and the apparent lack of local accountability and genuinely concerned that an element of back-door

  19
  privatisation seems to be involved. Will my hon. Friend give me a message to pass on to those probation officers that will at least ease some of their fears?
  Paul Goggins: I thank my hon. Friend for raising this issue, in which he takes a keen interest. Today's probation service has been transformed from the service that existed when we took in office in 1997. There are 5,000 additional staff and a further 2,600 staff will be recruited in the next two years. My message to it is that we will continue to invest in the important work that it does and that we understand the pressure it is under. As the Minister with responsibility for such matters, I want to engage in a constructive dialogue with the probation service and the Prison Service to ensure that we introduce the National Offender Management Service effectively.

  Identity Cards
  George Osborne: If he will make a statement on his plans to introduce identity cards. [171326]
  The Minister for Citizenship and Immigration (Mr. Desmond Browne): As my right hon. Friend the Home Secretary announced last November, we intend to build
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  the base for a compulsory identity card scheme and on 26 April we published for consultation plans for identity card legislation. The Home Affairs Committee will undertake pre-legislative scrutiny of that Bill, which I welcome. If the hon. Member for Colchester (Bob Russell) can keep his eyes open without discomfort, he will doubtless make a significant contribution to such scrutiny.
  Mr. Osborne: Since the abolition of ID cards in the 1950s, Home Office officials have tried to persuade successive Home Secretaries to reintroduce them. Why does the Minister think that this Home Secretary is the first one gullible enough to produce a White Paper on them?
  Mr. Browne: My right hon. Friend the Home Secretary advises me that a previous Home Secretary did produce such a document on that matter. However, the point of the hon. Gentleman's question is not who produced it, but gullibility. The hon. Gentleman should test the temperature of the hour and understand the view of the people of this country who need secure identity and security of their borders. The people are overwhelmingly in favour of developing this policy, but they want it done carefully and delivered appropriately. That is exactly what the Government will do.

Iraq: Security/Mistreatment Allegations
3.30 pm
The Secretary of State for Defence (Geoffrey Hoon): With your permission, Mr. Speaker, I would first like to bring the House up to date in relation to the current security situation in Iraq. Recent weeks have seen British forces, our coalition allies and the Iraqi police facing violent attacks in southern Iraq. This weekend saw the most violence so far, with more than 100 engagements between violent insurgents and coalition forces. Eleven British soldiers and one Dane were injured in those clashes. Our forces have captured a very large quantity of arms and ammunition from the Muqtada militia. The insurgents are armed with mortars, rocket-propelled grenades, and a wealth of automatic weapons. We have captured 10 multi-launch rocket tubes, 300 mortar rounds and three wire-guided missiles just over this weekend.
The upsurge in violence appears to have followed calls at some Friday prayers for attacks against the coalition. Many of those who responded have a violent and criminal background that pre-dates the arrival of the coalition in Iraq last year. They are thugs, not freedom fighters. They do not enjoy the support of the majority of people in Iraq, who welcome the strong security action that we are taking. These attacks against Iraqis and Iraqi institutions are a challenge to the rule of law—an attempt to disrupt reconstruction efforts and deliberately to damage the transition to a democratic Iraq. No sensible person can condone these attacks: everyone should support our effort to deal with them in the interests of the Iraqi people.
The situation in both Basra and al-Amarah remains tense, but the Iraqi police are patrolling and are engaged in other security tasks. Further violence cannot be ruled out in the coming days, and British and Iraqi forces will continue to confront such challenges. As ever, they will do so with the minimum necessary use of force and with great care to avoid unnecessary impact on the wider population.
Last week, my right hon. Friend the Minister with responsibility for the armed forces made a statement about allegations of abuse by UK forces in Iraq. I would like to deal with developments since that statement. There have been further details and images of abuse by US forces, and further claims against British soldiers, published mainly in the Daily Mirror. Last week my right hon. Friend made it clear that if the allegations are found to be true, those responsible for damaging the otherwise excellent reputation of our armed forces will be rooted out and dealt with. The unauthorised actions of a very few must not be allowed to undermine the outstanding work of tens of thousands of British soldiers and civilians who have served with distinction, compassion and sensitivity in Iraq now for over a year. We regret the shadow that has been cast across the excellent work being undertaken, under very difficult circumstances, to establish security and to rebuild Iraq.
The United Kingdom requires its forces to act at all times within UK law, which means that they must comply with the Geneva convention and international humanitarian law. Allegations of improper behaviour will be thoroughly investigated. We are not in any way complacent about such allegations. The 33 cases of Iraqi
22
civilian deaths, injuries and ill treatment, which my right hon. Friend mentioned last week, which have been or are under investigation testify to our determination. As he mentioned, 15 have already been resolved as having no case to answer and a further six are proceeding.
Those investigations were not begun in response to the International Committee of the Red Cross, to Amnesty International or, indeed, as the result of any pressure through the media. We investigate through the Royal Military Police special investigations branch immediately evidence is brought to hand. In those investigations, it is essential that the integrity of the criminal justice process be maintained. That can involve detailed and lengthy processes, but those are crucial to allow the necessary impartial evaluation of the evidence. I can confirm today that two cases have reached an advanced stage with decisions on prosecutions pending.
Obviously, it is important that the legal processes should be completed independently, but I want to say on behalf of the British Government that we unreservedly apologise to any Iraqis where the evidence shows that they have been mistreated, whether that is, as Amnesty International has set out in recent correspondence, during the general interaction between British troops and Iraqi citizens on the ground, or in the more specific issues raised by the ICRC about Iraqis detained in British-controlled facilities.
The confidential report from the ICRC to Ambassador Bremer in February dealt with detention issues. We have always maintained a close and constructive relationship with the Red Cross in Iraq. My right hon. Friend the Minister of State for the armed forces had a meeting with Dr. Jacob Kellenburger, the ICRC president, in May last year, and officials from the Ministry of Defence met the ICRC in April. It has been the practice of the ICRC to keep such reports confidential, not only to maintain a positive working relationship between Governments and the ICRC, but to protect those mentioned in them. It is important that that confidentiality is respected. Roland Hugenin-Benjamin of the ICRC said at the weekend:

"We usually do this in direct confidential contact with the detaining power. We do not believe very much that there is a lot of interest for the prisoners themselves of having those kind of issues exposed in the public domain."

The interim report in February dealt with ICRC visits to coalition facilities between March and November last year. It raised three specific concerns in respect of British forces' treatment of prisoners and internees. Since those issues are already in the public domain, it is appropriate for me to comment further.
The first issue is in respect of the death in custody of Baha Mousa, also known as Baha Maliki, last September. A Royal Military Police investigation was launched at the time. The case has featured frequently in the media since then and was raised by the hon. Member for East Carmarthen and Dinefwr (Adam Price) during an Adjournment debate in January. It was the subject of an Amnesty International letter-writing campaign. My right hon. Friend the Minister of State for the armed forces wrote to Amnesty about the case on 11 November 2003 and again on 27 January. It follows, therefore, that by the time the ICRC referred to the case in its interim report in February, a thorough investigation was well under way and the Government had made frequent public comment on it.

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The second concern raised by the ICRC in relation to the United Kingdom was in respect of the routine hooding of prisoners. That practice had already ceased in UK facilities from last September, and that change had been confirmed publicly.
In the third case, a detainee had claimed that his car was confiscated. We were not able to shed light on that case. The individual was briefed on our claims procedure and provided with a claim form. Nothing more has been heard from him.
The interim ICRC report was not seen by Ministers until very recently. That is because it was an interim report to Ambassador Bremer, passed to the United Kingdom in strict confidence. A follow-on, UK-specific report was, in any event, anticipated, and in the cases relevant to the UK armed forces, the action necessary to address the ICRC's concerns had been taken some five months before the report was actually issued. In February, therefore, officials at the permanent joint headquarters judged that there was no action that Ministers needed to take, at least until any further reports were received. Essentially, all the material the report contained dealing with issues relevant to the United Kingdom had already been dealt with.
Since the programme of ICRC visits last year, we have opened a new divisional temporary detention facility in southern Iraq. The ICRC visited the site before it opened and has visited it twice since, in February and April. It is due to visit again next week. We remain committed to consultation with the ICRC and to complying fully with ICRC requests for access. The ICRC has yet to submit a formal report to the Government in respect of the two visits carried out, but it has provided working reports to our forces in theatre. It is fair to say that the ICRC is generally satisfied with our approach and describes conditions of internment as "fairly good".
We will obviously continue to work closely with the ICRC to ensure that prisoners' concerns are addressed. In the light of recent publications, we judge that if the ICRC were willing to publish its report, the United Kingdom Government would have absolutely no objection.
In addition, recent representations have been made by a number of other groups, including Amnesty International, making allegations about incidents, including some of which the Ministry of Defence was not previously aware. Those incidents do not involve allegations about detainees. We will always take such credible allegations seriously. As a consequence, at the beginning of March, we began a thorough trawl of the records of units produced in Iraq since the commencement of operations last year. That is a considerable task, and we expect it to last a few more weeks. I assure the House that if it reveals further examples of incidents that merit formal investigation, investigations will follow. In turn, if British forces are found to have acted unlawfully, the appropriate legal action will be taken. That has happened in every single case so far.
Those thorough and detailed investigations have also been necessary in relation to the photographs published by the Daily Mirror some days ago. Those photographs
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are central to accusations concerning the behaviour of British troops, in particular, the Queen's Lancashire Regiment. I can tell the House that as a result of those further investigations the SIB has informed me that there are strong indications that the vehicle in which the photographs were taken was not in Iraq during the relevant period. Additional lines of inquiry are being pursued to corroborate that fact.
The SIB has interviewed at length the soldier described by the Daily Mirror as "Soldier C". We are grateful to "Soldier C" for coming forward. However, I can assure the House that the allegation at the centre of his evidence, which is once again the case of Baha Mousa, has already been investigated and the case is currently with the Army legal services for consideration. When interviewed by the RMP, "Soldier C" did not have any new evidence to add to what was already known as a result of our investigations. Indeed, as I have already mentioned. those allegations were widely covered in other newspapers many months ago. I leave it to the House to judge why they have been recycled in that way.
In conclusion, we are determined to see through the task in Iraq according to standards of behaviour set out in the Geneva convention and international humanitarian law. We will not hesitate to act where those high standards are not followed, and we will investigate when serious allegations are brought to our attention. But we should not lose sight of the fact that thousands of our service personnel continue to serve their country with great distinction in Iraq and around the world. We are appalled by the allegations made against an unrepresentative small number, but that will not diminish our admiration of, respect for and pride in those who continue to serve their country with such distinction.
Mr. Nicholas Soames: I thank the Secretary of State for his statement and for providing an advance copy earlier today. Nothing should detract from the fact that we on the Conservative Benches have the highest confidence in, and admiration for, the professionalism, courage and skill of the men and women of the British armed forces serving in Iraq and elsewhere.
Will the Secretary of State agree that, as the coalition seeks to bring democracy, stability and freedom to the broken country of Iraq, the promotion of the rule of law in the chaotic and disastrously ill-planned post-conflict environment must come first? Will he further agree that the military do not see themselves as being above the law and that the hard lessons of earlier counter-insurgency operations have been well learned by the British Army?
The House will be aware that Britain ratified the additional 1977 protocols to the 1949 Geneva conventions and that article 75 of the first protocol specifically prohibits

"outrages upon personal dignity, in particular humiliating and degrading treatment … and any form of indecent assault".

As I said in the House last week, if the recent allegations against British soldiers are found to be true, they must be proceeded against with the full rigour of military law.
I understand that Amnesty International has reported to the MOD on several occasions since May of last year, alleging that abuses by British soldiers were

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taking place in Iraq. When did the Secretary of State first see those reports? What steps did he then take and what actions were taken by the chain of command to deal with them? If he did not see those reports, who in his Department did and what did they do about them?
In respect of the ICRC, is the Secretary of State really being serious in telling the House that neither he nor any other Minister in the MOD was made aware of the ICRC report until very recently because it was given to the British Government in confidence? For goodness sake, who on earth is running the MOD? Who is authorised to see important and confidential documents from the ICRC?
The Government's failures in that regard must lend further credence to the view that they have lost their grip on their policy in Iraq. If the Secretary of State did not know about the document, he most emphatically should have done and he is unacceptably complacent and negligent in not having done so. Even if he did not see it himself, when exactly was the ICRC report received by the MOD and who dealt with it? When were investigations commenced into the assertions that it made?
When precisely did the Secretary of State himself see the report and did he ensure that a copy was passed to the Prime Minister? And if not, why not? As the document has been published today, will the Secretary of State officially publish the ICRC report in full on this side of the Atlantic? Surely, there can now be no reason for him not to do so.
How can the Secretary of State account for the reply of the Minister of State for the armed forces, given to my hon. Friend the Member for Westbury (Dr. Murrison) in the House last Tuesday, that:

"To date, I have received no such reports, but some may be in the process of being compiled"? —[Official Report, 4 May 2004; Vol. 420, c. 1216.]

Does that not show that at the very least the Minister was in dereliction of his duty, or had the Secretary of State or his officials simply forgotten to tell him? Was it just the Government's continual, serial complacency?
Can the Secretary of State confirm that the ICRC brought its concerns to the attention of the coalition forces on several occasions, orally and in writing, throughout 2003? When were British commanders in MND—multinational division—south-east first made aware of the alleged abuse of prisoners by British forces?
In the light of these allegations, how many members of the British armed forces have been investigated and how many are currently being investigated? How many Iraqis are currently in British detention and how have they been graded? Given the seriousness of the cuts by the Government in the military training programme, is the Secretary of State himself entirely satisfied that British troops deployed to Iraq, including members of the Territorial Army, were given a full and detailed training package on handling prisoners and on their obligations under the Geneva conventions? Did the British servicemen who took part in investigations at Abu Ghraib make complaints at any time about maltreatment and irregularities at the prison?
The Government are causing a great deal of unwanted and unnecessary uncertainty by their persistent and wilful failure to give substantial answers to clear questions on those matters. At one moment, the
26
Prime Minister claims that he is in discussion with the Americans over further troop deployments; yet within hours his spokesman denies it. At one moment, the Minister for the armed forces comes to the House to claim that he has not received the ICRC report, only for it to be announced yesterday that the MOD received that report in February this year. The Government's handling of these events is part and parcel of their fundamental and tragic incompetence and failure in the post-conflict planning for Iraq.
The Government must now set to and set out with clarity their plans for the remaining 51 days—only 51 days—leading to the transfer of power, and deal in detail with the many questions that my right hon. and learned Friend the Leader of the Opposition has been asking, but which remain as yet unacceptably, and for the Government embarrassingly, unanswered. Today, the Secretary of State has a chance to come clean.
Finally, there are no circumstances under which the brutal and disgusting humiliation of disarmed and helpless prisoners can be excused. The replaying of those images day after day throughout the middle east and indeed the wider world has the potential to undermine the significant gains that have been made towards the goals of peace, stability and freedom in Iraq. Furthermore, the apparent ignoring of the Geneva conventions invites our enemies to do the same and increases the existing dangers to our servicemen and women.
The Government's greatest and most immediate task is to restore the confidence of the British people and the people of Iraq both in what we are seeking to do in that country and, most especially, in the reputation and good name of the British Army.
Mr. Hoon: I regret to say that the hon. Gentleman uncharacteristically failed to listen to my statement; otherwise he would have noticed that I had answered all the questions—[HON. MEMBERS: "No."]—that he set out in his bluster, but I will repeat them. [Interruption.]
Mr. Speaker: Order. I will not allow anyone to shout down the Secretary of State.
Mr. Hoon: I will repeat the answers so that the hon. Gentleman can hear them, yet again, having had the benefit of reading the statement. Unfortunately, he obviously prepared his bluster before he came into the Chamber.
Amnesty International has written a number of letters to the Ministry of Defence about allegations concerning British troops, but, as I set out in my statement, most of those allegations—indeed, all but one letter—concerned the general interaction between British troops on the ground and Iraqi citizens, as British soldiers have gone about their security tasks in Iraq. That is obviously important. I am in no way condoning any manner of illegality by British troops, but that is quite different from the nature of the allegations made in relation to detainees. As far as I am aware, Amnesty International wrote one letter to the Department specifically about the concerns that it had last May, a year ago. That was replied to, and investigations were undertaken by the Ministry of Defence into those allegations. I have not received any further letter from Amnesty International

27
about those allegations. Indeed, a letter was received today and I saw a letter from two weeks ago—neither of which mentioned those early, year-old allegations, which, as I say, have been thoroughly investigated.
As for the ICRC, again, my right hon. Friend the Minister of State for the armed forces said that he had not read that report. Again, I set out very carefully the reasons for that. That was an interim report in February, and by the time that it had been considered in the Ministry of Defence, each and every allegation—the three allegations specifically dealing with the role of British troops—had already been dealt with. That was the judgment of officials in the permanent joint headquarters, having dealt with those matters already, as a result of action by Ministers. I make no apology for saying that. Ministers instructed that those investigations should take place. Those investigations were continuing and continue today because, obviously, it is not a matter for Ministers to decide whether soldiers should be prosecuted. It is however a matter for Ministers to decide whether investigations should be properly pursued. That is precisely what happened.
The further point that I made in my statement was that this was an interim report, pending a further specific report from the ICRC in relation to the United Kingdom's responsibilities to detainees. As I set out in that statement, it clearly indicates that, as far as the United Kingdom is concerned, the ICRC is generally happy with the steps that we have taken at our facilities. The material that has been put before the ICRC and the consultation that we have had on regular basis with it has satisfied it that we are imposing proper standards and proper procedures in those areas for which we are responsible.
I mentioned as well that 33 cases had been the subject of investigation—going back to the more general matters, not matters concerned with detainees. I indicated to the House that 15 of those had been resolved without there being any case to answer and that a further six were still being pursued through the system.
Mr. Paul Keetch: I welcome the statement and thank the Secretary of State for early sight of it. I know from my experience that the vast majority of armed forces measure up to the highest possible standards of professionalism and conduct and are a credit to our nation, but wrongdoing, if proven, must be punished. So may I ask the Secretary of State about the Red Cross report? That report clearly refers, as he accepts, to UK forces, including the death in custody of one individual. That report should have been brought directly to the attention of UK Ministers and to Parliament. Why was it not? If the Minister of State for the armed forces has not read the report, did he know of its existence?
The Red Cross says that it notified UK officials at Doha of potential problems in April 2003. Can the Secretary of State now confirm that? If UK military advisers in the region were informed of potential problems, why did they not pass on those concerns to the Government? It has sometimes been suggested that the UK Government wield little influence with the coalition, but can it really be the case that a report from
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the Red Cross that directly referred to the role of UK forces was given to coalition authorities, including Paul Bremer, but that he did not bother to tell UK Ministers?
Can I ask about the report from Amnesty International? Did the Secretary of State see this report last May when Amnesty says that it sent it?
On another specific matter, last week, I asked the Minister for the armed forces about a fusilier who was arrested last year after developing photos apparently showing the abuse of Iraqi prisoners. What charges have been brought against this man? Will the Secretary of State say?
This House of Commons voted to send our troops to war. If there is any doubt whatsoever about their actions, it is this House of Commons that should be told immediately. Why were we not?
Mr. Hoon: A common thread runs through each of the three examples that the hon. Gentleman has raised. In each of those cases, there was a thorough and proper investigation the moment those allegations were notified to the Ministry of Defence. Let me make it clear. They were not notified to the Ministry of the Defence by the ICRC, by Amnesty International or by the press. They were notified as a result of the proper procedures that are undertaken to safeguard the Iraqi people and, indeed, our own forces from these kinds of allegations. Not all of the allegations will be founded. A thorough, proper investigation took place in each of the examples that he has cited. Therefore, it was not necessary to act upon the ICRC recommendation five months later after the investigation was under way.
In a similar respect, the so-called Amnesty International report that the hon. Gentleman mentioned was a letter. I have dealt with the letter already. It was sent a year ago, and it was investigated properly and thoroughly. Amnesty International has not subsequently raised those cases. Similarly, with regard to the fusilier that he mentioned, that soldier is the subject of a process that could lead to criminal prosecutions.
In conclusion, I say in relation to each of the three examples that the hon. Gentleman cites that he would not wish Ministers, Members of Parliament or anyone else in a position of political authority to be interfering in a proper legal process to determine whether those individuals are or are not subject to criminal prosecution.
Ann Clwyd: As my right hon. Friend knows, I have supported action to topple the regime of Saddam Hussein since the 1990s. As he also knows, I was appointed as special envoy to the Prime Minister on human rights in Iraq in May 2003. Can my right hon. Friend the Secretary of State explain why his officials failed to show me the ICRC reports when they arrived?
Mr. Hoon: I am in exactly the same position in answering my hon. Friend's question as I was in answering questions from the Opposition. As far as officials were concerned, the interim report contained material about the United Kingdom that had already

29
been resolved. Therefore, there was no need, as far as the interim report was concerned, for Ministers to be involved.
Mr. Ian Taylor: Of course, the Secretary of State is right to say that the overwhelming majority of British troops are doing what they have to do properly in Iraq, but they are likely to come more into harm's way as a result of these exposures and also because of the way in which we went into this conflict in the first place. Many of us said that it would make us look much more like an army of occupation than an army of liberation. Can the Secretary of State just clarify what General Sir Michael Walker meant at the recent Defence Committee sitting when he said that we fight with the Americans, but not as the Americans?
Mr. Hoon: General Sir Michael Walker was responding to a specific observation from—if my memory serves me well—General Sir Mike Jackson and he was saying that the way in which British troops are trained, organised and deployed particularly on peacekeeping operations is not precisely the same as that of the United States or, indeed, of any other country. Each country rightly maintains its own discipline, ethos and way of committing forces into operations.
Mr. Robin Cook: My right hon. Friend has clearly now had an opportunity to read very carefully the Red Cross report. Can he therefore confirm to the House that the Red Cross report is not just about individual cases, but concludes that there was a consistent pattern of brutal behaviour and that the abuse and humiliation of detainees was systematic? If his case is that this is not relevant to the UK because it was carried out by US service personnel, can he tell the House what concerns and protests were expressed to the US authorities about the report? Does he accept that brutality by any member of the coalition forces is bound to increase the resistance and the risks to all members of the coalition forces? In retrospect would it not have been wiser and more effective for those protests and concerns, if they happened, to have been expressed at the highest ministerial level and not at some operational level?
Mr. Hoon: I do not disagree with my right hon. Friend, especially in his closing comments. Obviously, the report, passed by the ICRC to Ambassador Bremer, an American, was for American consideration, just as it was for British consideration. As I have repeatedly said, the United Kingdom carefully considered the cases that the report raised which affected the position of British troops, and we had already dealt with those matters, specifically as far as the UK was concerned.
Mr. Desmond Swayne: Why was not Operation Stewart implemented as planned last autumn? The Secretary of State will know that had it been so, the arrest warrant issued by the Islamic court against Muqtada al-Sadr would have ensured that he was lifted at a time both of a relatively benign security environment and of our choosing, so avoiding much chaos later.
Mr. Hoon: The hon. Gentleman would not expect me to go into precise operational detail I can, however, say
30
that he is right: an opportunity was being considered for the most appropriate occasion on which to execute the arrest warrant. That appropriate occasion has still to arise.
Mrs. Helen Liddell: My right hon. Friend will be aware that the morale of the families of serving troops will be badly affected by the allegations, and that will not have been helped by the opportunism of some Opposition Members. Will he confirm that UK troops are given training and are aware of their obligations under the Geneva convention and of their other international responsibilities, and that every allegation is investigated rapidly?
Mr. Hoon: I am grateful to my right hon. Friend for her observations. I assure her and the House that appropriate training is given to our armed forces on their legal obligations. There are appropriate people at each level to give appropriate advice. In this conflict, perhaps more than in any other conflict, lawyers have been close to the front line providing up-to-date information and advice on the obligations that British forces have in international law.
Mr. Alan Duncan: War tends to magnify anyone's personal qualities. The good can become heroic, but the bad can become sickeningly depraved. Will the Secretary of State confirm that nothing reported to him so far about the British Army in any way compares with the seemingly bestial conduct of some elements of the American army?
Mr. Hoon: I have to say that there have been some allegations about British troops which, if they stand up, are not allegations that any other member of the armed forces would want to be engaged with. That is why it is so important that we deal with these matters vigorously. That is the assurance I give to the House: when any allegations have been made, they are properly and seriously investigated. If appropriate, they are handed over to an independent authority to determine whether charges should be laid. There are actions that involve British troops which, once resolved—if they are resolved—against the individuals concerned, would worry us extremely, which is why I gave the apology that I did.
Mr. Ronnie Campbell: I have the utmost respect for the professionalism of the British forces, as does every hon. Member. I include my son in that, who is serving in the Royal Marines and was in Basra for the invasion. Last week, however, a mother of a recruit at Catterick garrison came to see me with allegations of what he and his comrades had to endure. They were made to parade naked in front of their superiors while they made fun of their private parts. When they tried to cover their private parts, they were punched in the face if they did not uncover them. That needs to be investigated, but it shows that the problem is endemic in the British forces and needs to be rooted out at home.
Mr. Hoon: I do not for a moment accept that it is endemic. I know that my hon. Friend has raised the problem with the Minister for the armed forces and

31
there will be a thorough and detailed investigation. Those allegations will be considered in the same detail and treated with the same concern as the investigations of those cases that I dealt with today.
Mr. Michael Weir: Whatever the truth or otherwise of the allegations against British forces in Iraq, the reputation of the UK's armed forces has been undermined by the constant drip of allegations. Does the Secretary of State accept that, to bring the matter to a head, we need a clear, independent investigation, rather than one conducted by the Royal Military Police? Only then can we be satisfied that justice has not only been done but been seen to be done.
Mr. Hoon: That is precisely what happens: there is an independent investigation conducted by those who are expert in and knowledgeable about military procedures. It is important that we give them our confidence in recognising the abilities that they bring to bear in looking at these cases. Moreover, if they judge that a case has proceeded sufficiently far, it is then handed over to an independent prosecuting authority to determine whether charges should be laid, so there is a significant degree of independence in the system that we already have.
Mr. Clive Soley: Does my right hon. Friend recognise that, having won the war, we are in acute danger of losing the peace, mainly because of the lack of a coherent peacekeeping policy by the United States? Does he accept that, in the context of any allegations against British soldiers, we need to be particularly visible in conducting our judicial processes? One thing that the people of Iraq know, and which we need to remember, is that far worse actions happened daily under Saddam Hussein, but those never got in the press or were raised in a court or anywhere else. The crucial difference in this situation is that we must be seen to be doing something about these allegations in a proper, judicial and public way.
Mr. Hoon: My hon. Friend is quite right in his conclusion. I would not in any way want to condone any unlawful mistreatment of Iraqi civilians by British soldiers simply because it was less bad than that perpetrated against the Iraqi people by Saddam Hussein. We cannot at any stage afford to depart from the high standards that we have set.
Mr. John Maples: The Government simply have to realise the devastating effect that the allegations are having on our policy, our reputation and our effectiveness in the middle east, and the only way of solving the problem is by ensuring complete openness.
I refer the Secretary of State again to an Amnesty press release from last Friday, which said:

"Last July Amnesty raised allegations of torture and ill-treatment of Iraqi detainees"—

not just people whom they met on the street, but detainees"—

"in a memorandum to the US Government and the Coalition Provisional Authority in Iraq."

32
When did the Secretary of State first see that? Is he saying that it was only very recently? It seems that he did not see it until allegations started to appear in the newspapers, whereas we would have expected him to have got a personal grip on the situation the first time that any such allegation was mentioned, to make sure that it did not happen again. It has happened, again and again. We want to know when the Secretary of State saw that information, and if he did not see it until about eight months after it was delivered to the CPA, why that was.
Mr. Hoon: I am not sure whether the hon. Gentleman is confusing two different reports. I made it clear in my statement that, this time last year, there was a letter from Amnesty International making certain allegations about UK treatment of detainees. That was responded to and indications were given to Amnesty that there would be, as there was, a thorough investigation. Since then, Amnesty has raised a number of further cases; indeed, in a long memorandum submitted in April, repeated in a letter that arrived shortly before I left the Ministry of Defence this afternoon, it set out a considerable number of cases concerned not with detainees but with the interaction of British troops on the ground. Each of those cases has been thoroughly investigated.
Other cases brought forward by public interest lawyers have raised one or two matters that we were not aware of, but as I indicated to the House in my statement, a thorough search of all our files is under way to establish whether those are genuinely new cases or matters that have previously been investigated.
Helen Jackson: Does the Secretary of State understand the depth of feeling among civilians in Iraq and their affront at the humiliation and torture that has been going on in their country in the name of the coalition forces? What will he and the US coalition forces do, from now, to reassure the civilian population in Iraq? Does he accept that an independent organisation such as Amnesty International is needed to start to rebuild any confidence among that population about what we are there to do?
Mr. Hoon: I broadly agree with my hon. Friend. She is right. I share the revulsion at the allegations and we need to investigate them thoroughly. However, may I give her an assurance? She says that we need to deal with matters now, but from the moment that any of the allegations were raised, the same process of thorough investigation has gone on—the same detailed co-operation with the appropriate independent organisation, which incidentally, is not Amnesty International, but the International Committee of the Red Cross. We have co-operated consistently with the ICRC and we will go on co-operating with its staff—providing facilities, allowing them to enter facilities, receiving their recommendations, and acting on them, where appropriate. However, the fact is that, by the time the ICRC's interim report was received, in each of the cases affecting British soldiers and British civilians, action had already been taken months and months and months previously. That is what I expect the House to hear from Ministers, and that is what I am saying.
Mr. John Burnett: Do the events that have given rise to today's statement and the Secretary of State's experience in office lead him to the conclusion that there should be an immediate extension in the period of basic training given to Army recruits?
Mr. Hoon: A substantial review of training is under way. I recognise as a result of recent experience and of allegations of failures in the training system that we still have more work to do in that respect. If there is the slightest suggestion that British, forces are not adequately trained to deal wish the sometimes increasingly complex legal issues in international law, that must be addressed.
Jeremy Corbyn: The Secretary of State made it clear in his statement that the ICRC report was sent to Paul Bremer in February this year. Was that information shared with Sir Jeremy Greenstock, who was his deputy? To whom was it passed in the Ministry or Defence or the armed services here? What has happened to those who apparently concealed the information from the Secretary of State or other Ministers, which has led to the disgraceful impasse we are in today?
Mr. Hoon: May I make it clear that there was no concealment? The report to Ambassador Bremer was passed to Sir Jeremy Greenstock, then to the military representative in Iraq, and from there to the Permanent Joint Headquarters.
Dr. Andrew Murrison: Last Tuesday, I asked the Minister for the armed forces whether he had received any reports from the ICRC. He replied:

"I have received no such reports".[—Official Report, 4 May 2004; Vol. 420, c. 1216.]

He said "received", not "read", as the Secretary of State appears to be saying now. Will the Secretary of State clarify what the Minister of State meant? For the report to have been given to Members today by journalists seems most extraordinary, given the Minister of State's previous comments.
Mr. Hoon: I have set out the process very clearly and I have just answered the specific question on how the report was received by Government. I stand by my earlier point: there was no detailed analysis of the interim report specifically because officials judged—rightly—that each and every action affecting British soldiers had already been dealt with.
Mr. Doug Henderson: The morale of our troops in Iraq, who are overwhelmingly committed, loyal and determined, will undoubtedly have been dented by the events of the past 10 days, but does the Secretary of State accept that their real problem is that the task is unclear and they are bogged down in the political basement, having entered without a clear strategy and with almost no exit strategy? Cannot our international reputation be restored only by going back to the United Nations and
34
making it clear that, with the Americans, we will carry out a phased withdrawal of troops if the UN establishes a force to try to bring security and stability to Iraq?
Mr. Hoon: I simply do not accept my hon. Friend's premise that the task is not clear. As I set out in the opening part of my statement, dealing with current events in Iraq, there is a determined effort, supported by the overwhelming majority of Iraqi people, to resolve the security situation in Iraq. If my hon. Friend is seriously saying that we should abandon that effort and simply leave Iraq to the mercy of those with the biggest weapons and the most powerful guns, I think that he is wrong.
Mr. Richard Shepherd: The Secretary of State consistently misrepresents his own position, and he misrepresents the Minister of State. He never answered the question about which words were employed last Tuesday in this House. The Minister of State said that he had "received" no such material, not that he had not read it. When did the Secretary of State receive it? Downing street tells us that it received it in February. Therefore, at what time did he discuss it with the Prime Minister, and when did he respond and read it? Furthermore, is this not just another example of his not being accountable to anyone or responsible for anything?
Mr. Hoon: The hon. Gentleman is uncharacteristically unfair and unkind. He misrepresents several points, not least what Downing street said about receiving the report. What Downing street said was that Government received it. It was indicating in the broadest sense that Government had received the report, and that officials, as I indicated in my statement, had acted on it. Officials made a proper consideration of the content of that interim report, which was analysed and dealt with, not least because, previously, appropriate action had properly been taken. If the hon. Gentleman were saying to the House that Ministers had failed to take action, I might just understand his criticism. The truth, however, is that Ministers dealt with the issue and made sure that appropriate action had already been put in hand.
Joyce Quin: Given the seriousness of the prisoner abuse in Abu Ghraib jail, and in view of the statement by Secretary Rumsfeld that it occurred on his watch, is it not important, in order to show Iraqi civilians and the Arab and Muslim world our determination that these events should not recur and our revulsion at them, that at the very least Secretary Rumsfeld should resign? Nothing short of a dramatic signal of contrition at this stage will do.
Mr. Hoon: The Defence Secretary in the United States has set out his position. I know that there will be a thorough US investigation. What I am saying to the House is that at each stage, when proper allegations have been made, there have been thorough investigations of any such allegations. If such allegations require further action to be taken, that will be dealt with.
Adam Price: The Secretary of State has just confirmed that hoods

35
were used on detainees in Iraq between April and September last year? Does he not accept that prolonged use of hoods on detainees can itself constitute degrading treatment? Putting a hessian sack on someone's head is often the first step in the process of dehumanising a victim. Is he aware that following the publication of the Parker report on allegations of torture in Northern Ireland, the then Conservative Prime Minister, Edward Heath, gave a solemn undertaking in the House that the British Army would never again use hoods as part of its interrogation purposes, which was enacted through a directive issued to the British Army by the Attorney-General? When did the policy change, and why was the House not informed?
Mr. Hoon: The policy did not change, and it was stopped.
Angela Eagle: Does my right hon. Friend agree that part of the difficulty in the American sector is not only the lack of training and lack of knowledge of the Geneva convention, but the apparent use of private security consultants, who appear to have egged on some of the abuses that have gone on in the American sector, and who are outside military discipline and military accountability? Will he assure the House that no such use is being made in British sectors of such personnel?
Mr. Hoon: My hon. Friend is right to raise this issue, which I know is the subject of the US investigation. I give her the assurance for which she is looking.
Mrs. Angela Browning: In view of the fact that the report has been so widely leaked, will the Secretary of State publish the ICRC document and put it in the Library, so that we can all read it?
Mr. Hoon: As I set out in my statement, and as Conservative Front-Bench Members should be aware, one or two of them having previously been Ministers, the ICRC is an independent body. The ICRC made it clear this weekend that it regrets the publication of its report. In the course of my statement, I said that I am certainly willing, in the light of what has been published, to write to the ICRC and say that the Government have no objection whatever to the further publication of the report dealing specifically with the United Kingdom. Ultimately, it is a matter for the Red Cross, since it is its report, and it asserts confidentiality. Both the former Ministers on the Opposition Front Bench—the hon. Member for Mid-Sussex (Mr. Soames), and especially the right hon. and learned Member for Devizes (Mr. Ancram), who had responsibility for events in Northern Ireland, where the Red Cross has from time to time intervened—who are waving reports that have been leaked as if a leaked report having been published proves anything, really ought to grow up.
David Winnick: Much more needs to be done about investigating the serious allegations against British military personnel. No distinction is made in the Arab world between the
36
United States and us where the Iraqis are concerned. When we see these sickening and degrading photographs of all the abuses that have been perpetrated, how is it possible to believe that such practices took place without the knowledge of senior people, right up to the United States Defence Secretary? How can we take his apologies of last week seriously when he clings so pathetically to office? If those apologies carry any credibility he should go, and go quickly.
Mr. Hoon: I hear my hon. Friend's words. I have made it clear that the United Kingdom will consistently conduct proper investigations whenever allegations of this kind are made.
Mr. Edward Leigh: The Government were warned repeatedly before the war that invading a Muslim country would make terrorism worse, not better, and that the country was virtually ungovernable. The Secretary of State mentioned the wider security position. Can he tell us any more about his strategy? Are more troops to be sent? Are existing troop numbers adequate? What is the Government's eventual strategy for extricating us from this morass—or are they just hoping for the best while our troops are put in more and more danger?
Mr. Hoon: The hon. Gentleman is right to draw attention to the wider security position, which is what I tried to do at the beginning of my statement. It is important for the House to understand the complexity and difficulty, from time to time, of the security position. That is why we keep the question of sending more troops under constant review There have been occasions on which we have sent more troops to deal with specific problems, as and when the commanders on the ground judge it to be necessary. Obviously we will respond accordingly if that happens, but no decisions have yet been made to that effect.
Mr. Robert Marshall-Andrews: Does the Secretary of State not understand that we are part of a collective enterprise—that he and the Prime Minister have taken credit in the past for what the United States has done, and that now we must take responsibility for what it has done as well? In doing that, will he answer the question put earlier by my right hon. Friend the Member for Livingston (Mr. Cook)? What representations, in detail, have been made to the Americans about the sickening and proved allegations that have been made in recent weeks?
Mr. Hoon: The hon. and learned Gentleman may suggest that we have taken credit. I do not recall his giving us any credit. While I accept that we are part of a coalition, we have direct responsibility, as should be the case, for the conduct of our troops. That is why I have expressed so clearly and emphatically our determination to ensure that the highest standards of British troops down the ages will be maintained in this Iraq operation.
Mr. Robert Key: Will the Secretary of State confirm that, regularly and as a matter of routine, every British serviceman and woman of

37
whatever rank is taught not only about the rules of engagement but about the provisions of the Geneva convention?
Mr. Hoon: That is absolutely right, and it is central to training. As I said earlier, however, if training turns out to be insufficient in the light of the increasing complexity of modern international law, we shall certainly look at that again.
Mr. Andrew Miller: Does the training include a proper reporting mechanism for our troops and for civilians? Does my right hon. Friend agree that persons reporting on matters in the public domain need to use very temperate language in the interests of our serving troops? As he knows, the Cheshire Regiment is in Iraq at the moment.
Can my right hon. Friend throw any light on the use of black-and-white photographs by the Daily Mirror? It was an unusual choice of medium.
Mr. Hoon: As I have said, further investigations of the Daily Mirror photographs are continuing. As I have also said, it does not appear that the truck used in the photographs was in Iraq during the relevant period. Obviously, the investigations would include investigations of the photography and, indeed, the use of black-and-white photography. That may have surprised my hon. Friend; it certainly surprised me.
As for my hon. Friend's first question, it is important to have an appropriate reporting mechanism in which people can have confidence. I apologise for repeating this so often, but it is vital for us to have an effective investigatory system.
Mr. Paul Marsden: On the eve of war last year, the Prime Minister promised that a war would bring about an end to

"The brutality of the repression—the death and torture camps, the barbaric prisons for political opponents, the routine beatings for anyone or their families suspected of disloyalty".—[Official Report, 18 March 2003; Vol. 401, c. 772.]

When does the Secretary of State expect such brutality to end under the coalition's jurisdiction, and is not it time that we understood that such brutality is giving succour and encouragement to would-be terrorists around the globe?
Mr. Hoon: I resisted earlier the suggestion that, because Saddam Hussein treated his people appallingly, that was an excuse for anyone acting on behalf of coalition forces to behave in a similar manner, but I invite the hon. Gentleman to think carefully—perhaps he will look at what he has just said in tomorrow's Hansard—and ask whether he is comparing the activities of British troops with those of Saddam Hussein. I am sure that, when he looks at his words, he will regret having said them.
Mrs. Alice Mahon: The Secretary of State did not answer my right hon. Friend the Member for Livingston (Cook) and my hon. and learned Friend the Member for Medway (Marshall-Andrews), so may I put the question to him again? We are in a coalition. We know that part of that coalition
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has been torturing, humiliating and killing prisoners in custody. That not only corrupts them; it corrupts us in the eyes of the world. Is not it time to go back to the United Nations, to get a credible force in there to help to secure the country, and to pull our troops out immediately?
Mr. Hoon: My hon. Friend will be aware that the United Kingdom is determined to see a further United Nations Security Council resolution and that we are already in discussions with other members of the Security Council and of the United Nations to determine a resolution that will provide further legal authority for our forces in Iraq.
Mr. Edward Gamier: My hon. Friend the Member for Westbury (Dr. Murrison) asked the Minister of State for the armed forces a direct question on 4 May: had he received any external or other reports? The Minister of State responded without equivocation, "I have not". It is at column 1216 of Hansard—it is being shown to him now. That was, in the light of what we have heard today, a confusing answer. What was the time lag between external reports arriving in the Ministry of Defence and landing on Ministers' desks, and what was the time lag between the reports leaving Ministers' desks and going to the Army legal service, the Crown Prosecution Service or the Attorney-General? We need the answers.
Mr. Hoon: The hon. and learned Gentleman is far too expert in matters of law to need me to suggest to him that there are no specific dates for the time scale between each of those separate events that he has described. It is entirely a matter for those investigating a case how long the investigation should be before the case is put before the authority deciding on prosecution. It is then for the prosecution authority to decide how long it should take and indeed whether it requires any further investigation or evidence to determine whether charges should be brought. I did indicate in my statement that, in two cases in particular, we are close to that point.
Mr. Malcolm Savidge: Can we seek the agreement of our coalition partners that, as far as possible, all Iraqi deaths, whether in custody or not, should be registered, recorded, counted and where appropriate investigated?
Mr. Hoon: I would like to be able to agree with my hon. Friend; it would certainly make my life easier in answering questions of that kind. In the course of military operations, it is extraordinarily difficult to identify casualtie—swhether an individual has been seriously wounded, lightly wounded or killed. Unfortunately, that information is simply not always available. Clearly, where it is available, we try to record it, but there is a risk in recording it of under-recording the number of casualties.
Mr. John Redwood: Did Ministers at any point discuss the conduct of our guards of prisoners and the way in which intelligence was extracted from Iraqis? Did they ever send out any instructions about how they wished those things to be

39
conducted? Would it not have been better if Ministers had read the ICRC report and responded to the general allegations in it as well as the specific ones?
Mr. Hoon: Ministers did respond to the general allegations—one of which, as I said in my statement, concerned the practice of hooding, which by then had been stopped. It was not specifically related to the United Kingdom, but was taken as a reference to a previous practice that had been ended. Ministers and officials responded to the criticisms in the interim report, as they should have.
Several hon. Members rose—
Mr. Speaker: Order. We now come to the main business.

Points of Order
4.30 pm
Dr. Andrew Murrison: On a point of order, Mr. Speaker. Is it in order for the Minister of State to mislead the House? In his statement last Tuesday, he said that he had received no reports from international organisations. That has been partly clarified but not fully. May I quote from a letter that I have just received—
Mr. Speaker: Order. The hon. Gentleman is seeking to extend the questioning of the Secretary of State. [HON. MEMBERS: "He is not."] I say that he is, and that is the important thing. He had an opportunity to question the Secretary of State; others did not. I ask him to refrain from extending his question through a point of order. I also point out to the House that there is a 10-minute limit on Back Benchers for the business that we are about to take. It is unfair to take any time out of that debate.
Harry Cohen: On a point of order, Mr. Speaker. I draw your attention to the conventions of the House. I am aware of at least a couple of Members who stood up during questions on the Minister's statement last week but were not called and who stood up again today and were not called. Generally, it is a convention that that is taken note of and that those Members are given an opportunity to speak on future occasions.
Mr. Speaker: Order. It is usually down to my fairness, so perhaps the hon. Gentleman will be called next time. He will be remembered; I will not forget him.
Mr. Oliver Heald: On a point of order, Mr. Speaker. It is obviously important that our proceedings be held in public and that commentators and others outside should be aware of what is happening. I understand that there is a document in which the Minister of State explains why he made his remarks to the House last week when reports had been received. Is it possible to find a way in which this document can appear in Hansard?
Mr. Speaker: I do not have powers to do so. It is up to the Minister, who will have heard what the shadow Leader of the House has had to say.
The Minister of State, Ministry of Defence (Mr. Adam Ingram): Further to that point of order, Mr. Speaker. Perhaps I could help the House. I have submitted a letter to the hon. Member for Westbury (Dr. Murrison), who raised the question last week, and I passed a copy to the main spokesmen of the Conservative and Liberal Democrat parties We tried to contact the hon. Gentleman by telephone today to tell him that the letter was coming; we could not do so. We faxed it to him and I personally put the letter on the board when I came to the House to try to make sure that he had it in advance of today's statement. [HON. MEMBERS: "Put it on the record."] I am coming to that point. It has also been placed in the Library of the House.
Mr. Heald:Further to that point of order, Mr. Speaker. One of the great problems with documents placed in the Library is that they are not on the record. That is one of the practices in this place that has arisen on occasion. There used to be 200 "will writes"; there are now 2,000. Should not this important letter be on the record in Hansard?
Mr. Speaker:Order. Documents placed in the Library—[Interruption.] Perhaps I can answer without any interruption from the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). Such documents are public records when they are put in the Library. Hon. Members can therefore use them in debate or in any other discussion.
Mr. Peter Luff:On a point of order, Mr. Speaker. I am not always a fan of modernisation but perhaps it would be in order if you reminded the Minister of State of the existence of written ministerial statements.
Mr. Speaker:Order. It is not for me to remind the Secretary of State. It is for me to get on with the main business.

Orders of the Day

  Energy Bill [Lords]
  [Relevant documents: Ninth Report from the Transport Committee, Session 2003–04, on Navigational Hazards and the Energy Bill (HC 555); Evidence taken before the Transport Committee on 28th April and appendices thereto, relating to Navigational Hazards (uncorrected typescripts are available in the Vote Office).]
  Order for Second Reading read.
  4.34 pm
  Secretary of State for Trade and Industry (Ms Patricia Hewitt):I beg to move, That the Bill be now read a Second time.
  The Bill is an important step towards fulfilling the Government's commitment to a sustainable energy policy, which we set out last year in the energy White Paper and which is designed to deal with three major challenges facing our nation. The first is the challenge of climate change, the second is the shift from being a net exporter of energy to becoming a net importer, and the third is the need to modernise our energy infrastructure to cope with changing technologies and needs. The Bill implements proposals on renewable energy and on competition in the energy market that we made in the White Paper. It also gives effect to the commitments on managing nuclear energy that we made in the 2002 White Paper.
  Important though it is, this legislation is not the whole picture. Since the energy White Paper was published, we have been active on many fronts, set out fully in our first annual report two weeks ago. For example, we have agreed principles for a new framework treaty with Norway for a new gas pipeline capable of delivering 20 per cent. of our annual gas supplies by 2006–07. We have submitted our draft national allocation plan for the European emissions trading system to the European Commission. We have put in place stringent new social and environmental guidelines to help Ofgem—the Office of Gas and Electricity Markets—to regulate markets, while making a sustainable energy supply more achievable.
  We have already given consent to, or have under consideration, applications for some 4.6 GW of new renewable capacity. Together with the existing capacity, that amounts to more than 60 per cent. of what is needed to achieve our 2010 target. The round 2 offshore proposals will add substantially to that figure. We have also lifted more than 750,000 vulnerable households out of fuel poverty through the Warm Front programme.
  Mr. Kevin Hughes:Does my right hon. Friend believe that taking this country into being a net importer of energy complies with part 1, clause 1, which states:

  "The Secretary of State shall have a duty to ensure the integrity and security of electricity and gas supply"?

  That seems a little strange to me.
  Ms Hewitt:My hon. Friend raises an important point, and I shall come in a moment to clause 1 as currently drafted. However, as he knows, because we have discussed it on other occasions, although the United

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  Kingdom has been in the fortunate position for some decades now of being a net energy exporter, most developed countries are not energy exporters, and that in no way damages their capacity for economic growth.
  Mrs. Gillian Shephard:Further to the previous intervention, when the Secretary of State comes to give that explanation to her hon. Friend the Member for Doncaster, North (Mr. Hughes), will she also explain what she means by saying in part 1 of the Bill that the Government should be required

  "to develop effectively sources of energy enabling the UK to avoid undue reliance on imports"?

  That chimes with what the hon. Gentleman said, and I am sure that the Secretary of State will want to expand on both those statements in part 1.
  Ms Hewitt:I am grateful to the right hon. Lady for that intervention, and I shall return to that point in a moment.
  Before I do that, may I underline the fact that the Bill has already benefited from extensive scrutiny? The part of the Bill that creates the single wholesale electricity market for Britain, the BETTA—British electricity trading and transmission arrangements—system, was published for pre-legislative scrutiny in January last year. The draft Nuclear Sites and Radioactive Substances Bill, which contained provisions on the nuclear decommissioning authority, was published for pre-legislative scrutiny last June. I am grateful to right hon. and hon. Members on the Trade and Industry Committee for their reports, which have been of great assistance in the preparation of this legislation.
  The Bill has also benefited from full and thorough debate in another place. Indeed, there have been 75 hours of debate on it already, and some valuable changes have been made as a result. For example, we have clarified the scope of and extended the time limit for appeals in part 4.
  Mrs. Gwyneth Dunwoody:Before my right hon. Friend leaves the point about the amendments made in those 75 hours, can she assure me that her Department's position now is that it does not intend to make changes to clauses 100 and 101?
  Ms Hewitt:I shall come to that point in a moment. I shall deal with the amendments made in another place as I deal with each of the issues in the Bill.
  The Bill has three main themes—competitive markets that will deliver for consumers, renewable energy and nuclear clean-up—and I shall deal with each in turn.
  Norman Baker:The Secretary of State did not mention energy efficiency, which as she knows can play a major part in tackling climate change. Why is energy efficiency not a central part of the Bill, and why was the Government's target sunk last week?
  Ms Hewitt:Both my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs and I are acting to ensure that we achieve the substantial
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  improvements in energy efficiency that are necessary, and which we set out in the energy White Paper. My right hon. Friend the Deputy Prime Minister, in his review of building regulations, is considering what more needs to be done to raise standards of energy efficiency in homes and offices.
  The first central issue in the Bill is competitive markets, and how they will deliver for consumers. Security of supply is a major concern for domestic consumers, for business and for Government. The current law places obligations relating to security of supply on me, as Secretary of State, and on Ofgem as the independent regulator. As hon. Members would expect, those duties are taken extremely seriously.
  I believe that the existing regulatory framework is best placed to deliver security of supply—a properly functioning market framework rather than command and control, or intervention by the Government.
  Mr. Crispin Blunt:While the right hon. Lady is making clear the value of the competitive market, will she also tell us that that competitive market has lifted far more people out of fuel poverty than her Warm Front initiative?
  Ms Hewitt:The significant fall in electricity prices resulting from our reforms of the previously rigged market have indeed helped many low-income households out of fuel poverty, as have the substantial improvements in low-income families' incomes resulting directly from benefit improvements and the tax credits introduced by my right hon. Friend the Chancellor of the Exchequer. All that is in addition to the Warm Front programme.
  Let us consider what happened last winter. The House will remember that at the beginning of the winter, just before Christmas and subsequently, we continually heard from various prophets of doom that there would be a winter of black-outs.[Interruption.] No, we did not hear that from the hon. Member for Eddisbury (Mr. O'Brien), but we heard it from many people who were extensively quoted in the press.
  What actually happened was that early in the winter, National Grid Transco signalled its prediction of the plant margin that might be available. The result of that clear information was that generators brought mothballed plant back, in response both to the NGT signals and to rising prices. Capacity increased, the lights stayed on and the scaremongers were proved wrong.
  Mr. Martin O'Neill:My right hon. Friend is to be congratulated on getting the mothballed plant into place, but the only problem—or perhaps I should say the advantage—was that it was never tested, because last winter was a good winter. It cost money for the companies to hold that hitherto mothballed plant in readiness for dramatic drops in temperature. How can we encourage them to do the same next winter? I hope that, again, it will not be cold, but the companies will still have the expense of keeping the kit ready for immediate switch-on.
  Ms Hewitt:My hon. Friend makes an important point. As that mothballed plant, which had been

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  withdrawn in response to low prices, was brought back on stream, the margin was about the same as it had been in previous winters. That was the market operating properly.
  I am concerned that as drafted, clause 1, which was introduced in another place, undermines the principle of properly working markets and independent regulation. We are therefore working with the energy industry to determine the best way forward. Members may have noticed a letter of 26 April to the Financial Times from the chief executive of Centrica and the managing director of British Gas. They said that what is certain is that if the Government change the rules now, regulatory risk would increase and potential investors in new capacity, including British Gas, would reconsider.
  Ms Joan Walley:Irrespective of the changes and the discussions that my right hon. Friend is having on clause 1, can she assure the House that she will speak to the Association for the Conservation of Energy, which is obviously very concerned about this issue?
  Ms Hewitt:If ACE has not already been part of those discussions, I am happy to give my hon. Friend that assurance.
  Part 4 of the Bill contains a number of provisions to promote competition in the energy market. Chapter 1 establishes a single wholesale electricity market for Great Britain—British electricity trading and transmission arrangements, or BETTA—which will provide access to a larger market for all generators. That is especially important to those in Scotland, where capacity already outstrips demand by 70 per cent., and where many of the new renewable generation projects are being built. But the new system will also help consumers: we estimate that Scottish customers' electricity bills should fall by some £13 a year on average.
  Chapter 2 implements European electricity and gas legislationߞ
  Paddy Tipping:Prices have fallen in real terms for many years, but the renewables obligation, the need to rewire Britain, emissions trading and energy efficiency will all add to costs. Is it not true that the days of relatively cheap power have gone, and that we need to think through the social, economic and political cost of increasing prices?
  Ms Hewitt:As my hon. Friend says, energy prices have fallen very significantly; in most cases, they are at a 20 or even 30-year low. We have to ensure that a market framework is in place—the White Paper made this case in some detail— that gives proper signals about the cost of environmental pollution, which is why we are so committed to the principle of the European emissions trading scheme. We also have to ensure much more investment in, and emphasis on, energy efficiency, which we all accept is by far the cheapest and most effective way of achieving our environmental, fuel poverty and security of supply objectives.
  Mr. Andrew Stunell:Will the Secretary of State give way?
  Ms Hewitt:I shall give way one more time on this point and then I will make some progress.
  Mr. Stunell:I am very encouraged to hear the Secretary of State's comments on energy efficiency, but can she explain, therefore, why the energy efficiency targets published last week reduced the original figures, rather than maintaining or increasing them?
  Ms Hewitt:I have already dealt with our determination to ensure that we make progress on energy efficiency, in response to an intervention from the hon. Member for Lewes (Norman Baker).
  Chapter 2 implements European electricity and gas legislation and, crucially, ensures fair access for third parties by extending the current licensing regimes to the electricity and gas interconnectors that will become increasingly important as we diversify and become dependent on imported gas supplies. Chapter 3 provides for an energy administration regime to be available in the event of the actual or threatened insolvency of a protected energy company.
  Chapter 4 provides for a mechanism for appeals to the Competition Commission against decisions of the Gas and Electricity Markets Authority—a key outcome of our consultation with industry. That will deliver greater accountability without unduly increasing regulatory uncertainty or delay. But the mechanism is tightly constrained to prevent trivial and vexatious appeals, involving a tightly defined process to ensure a swift outcome. The remaining clauses in chapter 4 and part 5 cover a number of smaller market-related items.
  I return to the point that my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) made about clauses 100 and 101, which deal with shipping. We do indeed intend to retain the substance of those clauses. We are considering whether they need to be amended to make them work in practice, and we shall of course reflect on the Transport Committee's recommendations.
  The second main area of the Bill deals with renewable energy. Every developed country is turning to renewable energy technology to deal with the increasingly urgent problem of climate change. Renewable energy undoubtedly offers huge business opportunities, as well as being a way of addressing an urgent environmental imperative.
  Mr. Michael Jack:I was personally delighted to discover the terms of clause 128 on renewable transport fuel obligation, because the clause reflects exactly the line that I put to the House a year ago when I spoke about the development of a biofuels industry. Does the Secretary of State have any intention of exercising the powers in the clause, according to which, she

  "may, by regulations, introduce a renewable transport fuel obligation."?

  Is it her intention so to do?
  Ms Hewitt:In association with my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs and her colleagues, we are looking into that matter. The right hon. Gentleman made an important point last year, and we certainly believe that there is the possibility of that power being extremely valuable in future. We are looking further into the detail at present.

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  I stress that, although we are making progress on renewable energy, we start from a very low base, particularly by comparison with some of our European colleagues. In 2002, less than 2 per cent. of the UK's electricity, was generated from renewable sources, so hitting the target of 10 per cent. by 2010 will require about 10 GW of renewables regeneration capacity.
  Dr. Desmond Turner:There has been intense debate about the performance and innovation unit report and the White Paper. The expectation in many quarters was that the legislation arising from that would make considerable advances in the deployment of renewable energy. I have to say that, per se, this Bill contains little that will contribute to the more rapid deployment of renewable energy. Will the Secretary of State tell us whether the Bill represents the last word on Government policy, or can we look forward to a further Bill that will actually drive renewable energy?
  Ms Hewitt:As I explained earlier, the Bill is not all that we are doing in respect of renewables or other aspects of the White Paper. The renewables obligation itself will build up by 2010 to be worth support of £1 billion a year. We have also extended the obligation to 15.4 per cent. by March 2016, so that investors can have no doubt at all about our commitment to renewable energy in the longer term. Indeed, we now have the first large-scale offshore wind farm at North Hoyle, which is already generating electricity. By the time it is fully operational, it will be capable of powering 50,000 households. Scroby Sands is under construction and consents have been given to a further 12 projects around the coast.
  The effect of clause 120, however—it was also inserted by the other place—will be to take combined heat and power out of the renewables obligation base. That will mean either less renewable energy or, if compensating measures were in place to keep the obligation level, additional costs to electricity consumers of some £90 million a year by 2010. We continue to look for practical ways to support combined heat and power, which is facing particularly difficult times with high gas prices and low electricity prices, but we should not do so at the expense of renewable energy. My hon. Friend the Minister for Energy, E-Commerce and Postal Services will therefore seek to reverse that provision later in the Bill's passage.
  Brian White:My right hon. Friend will be aware that many renewables companies, such as Powergen and British Sugar, have said that support for the combined heat and power industry is necessary. They believe that use of the renewables obligation is the right way forward because the state of the industry requires such a step forward. Will my right hon. Friend take into account the views of those major renewables companies that are pressing for the clause to remain?
  Ms Hewitt:We have worked extremely closely with the CHP industry but we do not want to support CHP at the expense of the renewable electricity sector or the renewables obligation itself.
  Mr. Andrew Robathan rose—
  Mr. Bob Blizzard rose—
  Ms Hewitt:If hon. Members will forgive me, I intend to make a little more progress.
  Part 3 creates the right legal framework to support future renewable energy developments further offshore, beyond the UK's territorial waters. It will pave the way for developments that could harness wave and tidal power, as well as wind, and it makes provision for new transmission networks to connect groups of developments to the shore. Part 3 will also allow us to move to a UK-wide system of tradable certificates for renewables electricity, once certificates can be issued in Northern Ireland and once Northern Ireland has implemented a corresponding system of mutual recognition.
  The Bill provides for new arrangements for nuclear clean-up. The nuclear industry makes a significant contribution to our economy, but the liabilities of waste and decommissioned plants that date right back to the 1940s add up to some £48 billion, and they will need proper management well into the next century. Our White Paper in 2002 spelled out how we would manage that nuclear legacy safely, securely and cost-effectively in a way that ensures protection of the environment. Chapters 1 and 2 of part 2 implement that commitment.
  Sir Robert Smith:As the Secretary of State said, nuclear clean-up is a long-term commitment. The Government have insisted on a segregated account for that, rather than putting the money into a separate fund. Why do the Government feel they need a segregated account to allow flexibility when that will undermine confidence in future generations that the money will definitely be there? A segregated account will make it easy for future Chancellors to decide not to allocate money.
  Ms Hewitt:The arrangements that we are making will make it quite clear, and transparently so, that the resources being dedicated to managing the nuclear legacy are used for that purpose.
  The Bill will establish a non-departmental public body, the nuclear decommissioning authority, to manage those liabilities better, and that will be operational by April 2005, subject to the Bill's safe passage. The NDA will have further strategic control over all public sector civil nuclear liabilities. It will operate clearly and transparently, and by fostering competition for the management of sites, it will ensure that the best skills and expertise deliver the highest standards of clean-up most efficiently.
  Chapter 3 modernises the existing policing arrangements for the nuclear industry, transferring the current UK Atomic Energy Agency constabulary to a newly created civil nuclear police authority, which will have responsibility for it. Chapters 4 and 5 include more minor updates and amendments to nuclear legislation, dealing with our international obligations in the event of a nuclear accident, and security of equipment and software relating to uranium enrichment and sensitive nuclear information.
  Mr. David Drew:In order to meet our international obligations, we have to maintain the basic integrity of our nuclear industry. Will my right hon. Friend ensure that the Bill underlines the need to train and upskill the existing work force and to get younger people into the industry? If it does not, with the best will in the world, it will never fulfil its potential.
  Ms Hewitt:My hon. Friend makes an extremely important point, which we underlined in the White Paper. Since we published the White Paper and made our commitment to working with the nuclear industry to sustain and grow the skills it needs, we have established a sector skills council, Cogent, which is moving forward on that matter. Quite apart from any issue about new nuclear build, the nuclear decommissioning and waste management operation will offer extremely interesting, well paid and highly skilled jobs for a very long time to come. The industry therefore offers wonderful career opportunities for young engineers and technicians.
  Mr. Michael Weir:Before the Secretary of State moves on from chapter 5, will she tell us something about the thinking behind clause 82 and the extra expenditures allowed by the Government to buy out nuclear power stations that may have been sold on to third parties?
  Ms Hewitt:I am delighted to say that my hon. Friend the Minister for Energy, E-Commerce and Postal Services will deal with that point when he winds up.
  I stress that we all appreciate the world-class scientific, professional and engineering skills of the people who work in our nuclear industry. I can also confirm to the House that the chosen location for the NDA is west Cumbria. I hope that there, and in the other places where the NDA will have responsibility for sites, we will develop even stronger clusters of nuclear business and talent. We will also give the NDA a statutory function to encourage and support the socioeconomic life of local communities and to work in partnership with people in those communities. It will have a key part, therefore, to play in the strategic taskforce for west Cumbria that is led by the Northwest Development Agency and which we announced in December last year.
  Dr Jack Cunningham:My right hon. Friend has been generous in allowing interventions. As she is talking specifically about my constituency and that of my hon. Friend the Member for Workington (Tony Cunningham), it is appropriate to say that we applaud and appreciate her decision to locate the headquarters of the NDA in west Cumbria and to set up a strategic taskforce to provide some joined-up thinking across Whitehall on the future of west Cumbria. However, there is a sting in the tail. To our great pleasure and the satisfaction of local authorities and the work force in the industry, the Secretary of State took that initiative in November last year, but the taskforce has not yet met. Can she tell us why?
  Ms Hewitt:I am grateful to my right hon. Friend for the work that he did in bringing together some of the key partners in Cumbria to visit me, so that we could discuss
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  exactly what was needed. My understanding is that the Northwest Development Agency is already in discussions with the local councils in Cumbria and that we are awaiting proposals from them. If it is not making satisfactory progress, I will make inquiries and ensure that progress is made because, like my right hon. Friend, I understand its importance to his constituents and the community.
  I stress that the energy industries contribute 4 per cent. directly to the gross domestic product of this country and they power all the rest of our economy. There is no issue that is more fundamental to our economy, to the quality of our lives and to sustainable development and our environmental future. In the White Paper, we set out a 50-year vision of sustainable energy and how that could contribute to the shift to a low-carbon economy. It was a 50-year vision, but action started immediately. The Bill will move us even closer to the cleaner, secure and affordable energy that our people and our businesses all depend on. I commend the Bill to the House.
  5.3pm
  Mr. Stephen O'Brien:This is a Bill of modest ambitions in the context of even the White Paper, especially when measured against the burgeoning resources of the Department responsible for drafting it and, even more importantly, against the context of our country's medium to long-term security of energy supplies—an issue from which the Secretary of State and her Department continue to shy away.
  The Bill, which started its passage in the other place, contains some positive provisions, not least because it was improved enormously by some constructive amendments from my colleagues in the other place and some from Liberal Democrats and Cross Benchers. I pay tribute to their success and I am sure that the House will recognise the great and, in some cases, incomparable experience that some noble Lords bring to such matters.
  It is invidious to single out one contribution, given the first-class team, ranging across shadow departmental briefs, that the official Opposition put together to work on the Bill, but the House will wish to join me in thanking warmly Baroness Miller of Hendon for her steadfast, indefatigable and insightful leadership and outstanding work on the Bill in the other place. We shall not, therefore, seek to oppose the Bill, but we will want to continue the excellent work commenced by our colleagues to improve it in Committee and beyond.
  A Government spokesman in the other place said that the Bill

  "provides … solutions to a number of legislative problems related to parts of our energy strategy." —[Official Report, House of Lords, 11 December 2003; Vol. 655, c. 834.]

  With a few qualifications, I do not dissent from that view, other than its pretence that the Government's policies amount to an energy strategy taken—to use a Blairism—in their totality. My main concern is that the Bill represents a missed opportunity, which we may all shortly come to regret, to set out a coherent and realistic strategy to ensure secure, safe, sustainable and affordable low-carbon energy supplies to UK domestic and business customers in the medium to long term. That is particularly regrettable since, when all is said and

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  done, it is hard to conceive of a more basic responsibility for any Government than to create the framework and enable conditions whereby the market ensures that the nation's lights stay on.
  It is not the presence of the Bill that I object to, but the absence of a different energy Bill that addresses the big and pressing problems at a time when a nexus of factors combine to make the matter an acute national consideration. The reasons for that are familiar, but I shall summarise them again. To put it bluntly, there is a looming black hole in the nation's energy mix. Taking breakdowns into account, normal operative standby energy capacity is more like 16 per cent. than the 21 to 23 per cent. habitually claimed. That scenario has prompted Professor Dieter Helm of Oxford university to remark:

  "We are very close to the margins, when this is something we should really be very risk averse about…The costs to everybody of any failure are so enormous. If there's a catastrophic failure in the shoe industry, nobody suffers very much. If electricity goes wrong, everybody is in big trouble."

  Meanwhile, we are committed to reducing our carbon dioxide emissions by 60 per cent. by 2050. We are becoming increasingly reliant on gas supplies, just as we are set to become net importers of gas for the first time—primarily through pipelines, as well as by shipments of liquefied natural gas—at a period when global terrorism and geopolitical instability show little sign of receding. Nuclear power's share of electricity generating capacity is in steep decline. It is expected to fall from 21 per cent. today to just 2 per cent. in 2023—just under 20 years. In addition, in the absence of so-called clean coal technology, coal-derived energy remains in decline and we shall also see an imminent decline in domestic oil supplies from the North sea. The latter has less to do with energy production and more to do with powering transportation and commercial and domestic heating.
  There is an enormous weight of expectation about the planned major expansion of renewable energy and energy efficiency. That is, of course, to be relentlessly encouraged, but the expectation, created by the Government, is that that will fill the looming gap in our energy supply. However, the Government have just had to revise downwards both their energy efficiency and carbon emissions targets. They are expected to miss their combined heat and power target for 2010 by about 20 per cent. Likewise, experts do not expect the Government to come close to meeting their ambitious target of 10 per cent. of power being generated by renewables by 2010, even when the loosest definition of "renewables" shows that we have remained stubbornly between 2 and 3 per cent. since 1997.
  We should keep a beady eye on the Government's definition of renewables. Changing the definitions is the surest way to avoid admitting a series of missed Government targets. It does not take a genius to see that if nuclear power were replaced by renewables, no carbon emissions reduction would be achieved by such a mere substitution. Only 11 days ago, the Department of Trade and Industry told the Financial Times:

  "Plainly, our policies on energy efficiency, emissions trading, renewable sources, transport and others will need to deliver more in future."

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  Energy policy cannot simply rely on the hope that the Government's policy will miraculously start to deliver more at some unspecified date in the future. It is too important to be determined by the aspirational target setting in which the Government specialise.
  That is why I am delighted that Conservative peers tabled an amendment that will require the Government to make specific progress reports on the development of new energy sources. I am also pleased that they succeeded in securing a separate amendment to clause 106, which strengthens the Government's insubstantial policy on energy efficiency by allowing energy produced by CHP to be exempted from the renewables obligation. As we have seen, without such incentive the Government are currently on course to fall well short of their targets. I was disappointed to hear that the Secretary of State wants to amend that. The £90 million that she claims as a fiscal cost has to be seen in the context of the fact that offshore wind turbines currently receive a subsidy of £117 million. So this is a matter of choices, rather than absolutes.
  We welcome the use of biofuels. The use of biodiesel and bioethanol can result in the reduction of carbon emissions. I have a very fine example in my constituency—e-diesel, produced by Stephen Whittaker. We welcome the fact that the Treasury is currently consulting on the fiscal regime. The Government must report their plans to the EU by July 2004, and we await the report with interest. The development of biofuels is expected to produce long-term benefits for the environment and can certainly bring economic gains for agriculture.
  Mr. Jack:Does my hon. Friend think, however, that there is a need for greater clarity of leadership on biofuels, given that the Treasury currently sets the fiscal regime, that the Department for Transport is dealing with the consultation paper on the introduction of biofuels in transport, that the Department of Trade and Industry deals with matters connected with biofuels and energy and that the Department for Environment, Food and Rural Affairs deals with the agriculture side of the issue?
  Mr. O'Brien:I am glad that my right hon. Friend has demonstrated how one can be joined up in opposition, even when that is not apparent in the Government. I very much hope, therefore, that the Government will consider his joined-up approach and deliver a package that can give him the. confidence to report positively to his constituents and the interests that he represents on an important initiative in biofuels.
  Mr. O'Neill:Does the hon. Gentleman agree that there are some dangers in going overboard in this respect? Only a limited amount of timber is available, and a number of timber processing plants across the country, such as the one in my constituency, convert wood into timber for the construction industry. If there were an undue demand for such wood, it could affect the availability of timber for house building and the like, thus producing the opposite effect in terms of doing the business.
  Mr. O'Brien:I am grateful to the Chairman of the Select Committee on Trade and Industry for raising that

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  point, because it must be recognised that we are talking not just about timber but about rape seed and other matters. We must consider encouraging a package of contributions to renewables, rather than banking on any particular approach, because it will be enough of a struggle to meet not just the Government's renewables targets but any substantial, worthwhile renewables targets in the overall energy mix. We must be extraordinarily careful and not simply talk about timber, as that would be a distortion.
  Mr. Richard Page rose—
  Mrs. Dunwoody rose—
  Mr. O'Brien:I give way first to my hon. Friend, and then to the hon. Lady.
  Mr. Page:After you.
  Mrs. Dunwoody:I am doubly honoured that both hon. Gentlemen have given way.
  May I put the hon. Gentleman's mind at rest? Recently, while questioning a member of a very powerful environmental lobby group, we were informed that we should insist that people take only six flights a year, and that if they insist on taking more they should plant a tree every time they do so. On that basis, judging by the number of flights taken by the environmental groups, the United Kingdom would soon be reforested.
  Mr. O'Brien:I most grateful to the hon. Lady for that intervention. We work closely on a non-party basis as, I hope, friendly neighbours in our constituencies, and I now look forward to the border between our constituencies being marked by some impenetrable forests, although I do not think that either of us would welcome an airport at Nantwich.
  Mr. Page:My intervention will not be as amusing as the hon. Lady's, but perhaps a little more serious. May I ask my hon. Friend not to press so quickly for a biofuels obligation? We do not have the production plants in this country to convert and produce the necessary biofuels. In that respect, the only thing that we do effectively is to process used fish and chip oil, whereas the Government should be developing plants to use timber and other products as biofuels. Let us get the production plants first, and then have the obligation.
  Mr. O'Brien:My hon. Friend raises a very important issue, which will be fully explored in Committee, as hon. Members on both sides of the House find it interesting. On the pace of introduction, which is dealt with in clause 128, the expectation is that such things should be phased in. That should give him some assurance and comfort, but the principal issue is to consider the vast variety and mix, even of the initial raw materials.
  My constituent, Stephen Whittaker, has taken redundant vegetable fats from cooking oils and produced the extraordinarily successful product of e-diesel, which I am glad to say is now being used by the lorry fleet of one of the large supermarket chains.
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  In addition to all the great environmental benefits, it has the attractive smell of almonds when it emerges from the exhaust.
  Mrs. Shephard:I hope the House will not be misled into thinking that the only sources of biofuel production are used fish and chip cooking oil and timber: rape, sugar beet and cereals can also be used. Is not the only reason that we do not have any plants the fact that we do not have a Government policy, let alone Government action, despite their oft-repeated statements in support of their environmental commitments?
  Mr. O'Brien:I am grateful to my right hon. Friend. I know that she has taken a long and distinguished approach to this subject on behalf of her constituents. She underlines the point about the multifarious sources that can lead to a successful biofuels policy. Signals from the Government are required and I hope that she will have the opportunity to develop that point if she catches your eye, Mr. Deputy Speaker.
  I shall now move from biofuels to the wider issue at stake, which goes to the heart of everything that is or is not in the Bill—the responsibility of Government to provide strategic leadership and to make the hard choices that inevitably lie ahead. Indeed, I am reminded of the words of the Chancellor of the Exchequer, who observed in The Guardian recently:

  "The Britain that will fail is the Britain that would duck the hard choices."

  I suggest, in a similar fashion, that the Government who would duck the hard choices are the Government who will fail, let people down and let the lights go out.
  That is why my colleagues in the other place inserted the security and supply amendment that formalises in statute a fact that is already implicit and well understood, not least by politicians, the energy industry and the wider public and the electorate. If, beyond a catastrophic act of God or a few hours of temporary or partial geographic failure, the lights go out, the fact cannot be ducked that the Secretary of State and the Minister for Energy, E-Commerce and Postal Services would have to resign. The Government of the day would have to take the urgent steps to enable the lights to be put back on again by the market. That is why it is plain wrong to suggest that the amendment is in any sense radical or that it represents a material shift in the role of the state in a competitive and liberalised energy market. It is categorically not an invitation to renationalisation.
  The Secretary of State surely recognises that she has duty to

  "maintain the reliability of our energy supplies",

  not least because that is the phrase used in the White Paper that she signed off last year. Furthermore, the logic of the amendment is no different from that of clause 153, which records the commitment that Ofgem has already made to being guided by best regulatory practice. No one is suggesting that that this confers greater regulatory powers on Ofgem; it just acknowledges those that already exist.
  It would be wrong to suggest that the amended clause is a prelude to interventionism. In codifying the de facto position today, it delineates the Government's duty and

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  places on them the responsibility to create the framework that enables the conditions whereby the market can deliver security of supply.
  Paddy Tipping:Does the hon. Gentleman accept that clause I now gives the Secretary of State the duty to intervene? Does he also accept that it is the market that will produce the energy? Is there not a danger that, by giving the Secretary of State the power to intervene, long-term investment from the private sector will be turned away?
  Mr. O'Brien:I am glad that the hon. Gentleman has raised that point. As I have just explained, the amendment codifies the current de facto position, not least in respect of the Norwegian gas pipeline. It takes Governments, by treaty, to negotiate the framework and conditions that enable the market to deliver the security of energy supplies. That is precisely what the amendment sought to do and, it can be argued, has achieved. I have made it crystal clear that the intention is not to be interventionist in the way that the hon. Gentleman implied. I do not think that the amendment can be interpreted in that way.
  With that clear statement, the Government's stubborn opposition to the security of supply amendment tabled in another place is a surprise and reflects their failure to apply themselves to the creation of a sustainable and long-term framework in which markets can deliver energy supplies. Since then, we have had the undignified and somewhat stealthy approach by the DTI, which has apparently urged, behind cupped hands, certain members of the industry to contact us on its behalf to drop the amendment. As it happens, my team and I heard not a word before the debate from the Secretary of State or her Ministers. There has been no attempt to forge a sensible dialogue in the national interest. Why? Perhaps the Government are afraid of tabling an amendment so that they cannot be held responsibility for delaying the Bill, which needs to be on the statute book to create the British electricity trading and transmission arrangements and the nuclear decommissioning agency by the summer. It is clear that amending the security of supply may engage the hostility of their lordships—there is certainly a good argument to be had—and risk delaying the Bill. The Secretary of State may want to take the opportunity to clarify that, but it seems that she does not.
  It has been suggested that the Bill is a misnomer and that it would more properly have been called the Energy (Miscellaneous Provisions) Bill or even the waste Bill. That is because its objectives—not in themselves invaluable—relate in large part to creating an effective framework for cost managing the nuclear legacy at the same time as ducking the debate on whether we are to have a nuclear future. As we just heard from the Secretary of State, that would take the form of the nuclear decommissioning authority and, appropriate at a time of heightened security needs, the creation of a civil nuclear constabulary.
  Subject to appropriate scrutiny in Committee, I have no overriding objections to either provision, although my colleagues will look closely at the arrangements by which qualified companies can apply for contracts to
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  manage NDA sites as the legislation progresses. In relation to the civil nuclear constabulary, I reiterate the calls, repeatedly made from Opposition Benches, for a Minister for homeland security, who would be responsible for providing overarching strategic leadership on all security issues.
  Another important feature is the establishment of the new British electricity trading and transmission arrangements. The creation of a competitive wholesale electricity market, based on the same rules throughout England, Scotland and Wales, is rational given the interpenetration of power companies across borders. I wonder whether the Government considered the possible difficulties of implementing such legislation when they drew up their eye-catching devolution initiative on the back of an envelope. Has the Secretary of State stopped to consider what will happen if the democratically elected MSPs in the Scottish Parliament do not agree to the provisions? How then—if at all—should Scottish MPs in this House vote?
  Part 3 deals with wind power and renewables. I accept fully the reality of climate change and the importance of low-carbon energy supplies. The issue, however, is establishing the appropriate response to that challenge. The Government have placed renewables, in particular onshore and offshore wind energy, at the heart of their policy. It is clear from the Bill that they are prepared to subsidise wind power, which costs about three times as much as conventional power. Leaving aside the structural confusion of having a regulator who tries to promote a competitive energy market and a Government whose ambition is to promote distorted markets—whether through the climate change levy or by subsidising renewables, possibly to the tune of £1 billion a year by 2010—taxpayers will quite properly wish to know whether the Government are spending their money wisely or whether they are making the most giant mistake about windmills since Don Quixote. To rely heavily on wind and, for that matter, on wave and tidal energy to be a major contributor to the long-term energy mix, when renewables contribute just 3 per cent., and to do so in the absence of a plan B, is a high roll of the dice.
  Let us not be hoodwinked. That 3 per cent. was derived in 2002 from 1.41 per cent. from biofuels, 1.26 per cent. from hydropower and a mere 0.33 from wind. To increase production without warning customers of the inevitable rise in energy costs is even less forgivable. I am indebted to Lord Jenkin of Roding for his successful amendment to clause 157, which requires transparency in the way in which consumers are properly informed of the financial ramifications of subsidising renewable energy sources. The Royal Academy of Engineering's report two months ago demonstrated that the costs per kilowatt of wind generation, including stand-by capacity, is almost three times the cost of the average power produced by coal, gas or nuclear.
  Wind energy is not without its drawbacks. Onshore, wind turbines are a blemish on the landscape. Do the Government not realise that they will be held to blame for the terrible despoliation and blight that they will inflict on Orton fell in Cumbria if, through subsidies for wind turbines and their proposals to change planning guidelines—I refer specifically to planning policy statement 22—they force that ugly scar of a scheme through?

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  Offshore, wind turbines can interfere with and disrupt ships' essential navigation systems. Again, I note that my colleagues have already secured important amendments limiting the siting of wind farms in shipping lanes and acknowledging the cumulative dangers posed to navigation by offshore wind farms. What is the Secretary of State's answer to the points raised by the British Chamber of Shipping in its letter to MPs just three days ago on clauses 100 and 101? I was glad to hear the response to the intervention of the hon. Member for Crewe and Nantwich (Mrs. Dunwoody), which is that the Government propose to retain the substance of the amendments. However, with so many interests at stake and with such expertise available, I urge the Government, for once, not to table amendments late; we need plenty of time to consider them in advance of the Committee, where, I assure the Secretary of State, they will be explored in detail.
  The White Paper points out that the Ministry of Defence has objected to one third of all recent proposals, both onshore and offshore, because they would interfere with its operational needs, including training and radar monitoring. Wind turbines cause environmental damage, affecting birds, fish and livestock, increasing damaging noise and being an unnatural intrusion in some of our most prized environmentally sound settings, not to mention being unsightly.
  Finally and most importantly, we must remember that wind turbines are only an intermittent source and thus cannot be relied on to provide a stable baseline source of supply. Denmark, where at 18 per cent. of energy production the proportion of wind power is the highest in the EU, has found that at any one time it has roughly 13 per cent. of its turbines out of commission. The Danish Government have recently announced that they are ending all subsidies to new wind power installations. Should not this Government be avoiding the same mistake?
  The Government's zealous support for wind power is matched by confusion and indecision about the future of nuclear energy, which emits no carbon dioxide and, according to the Royal Academy of Engineering, is more cost-efficient than wind. It is no surprise that every time the word "nuclear" is uttered, the knee-jerk response from the Liberal Democrat spokesman, who is not in his place, is that those who utter it are obsessed.[Interruption.] I refer to the hon. Member for Gordon (Malcolm Bruce) who, on the occasion in question, was dealing with energy matters. Ducking the hard choices is a speciality of the Liberal Democrats, as is their reliance on wind.
  As the Government's chief scientific adviser, Professor David King, said on the Today programme in 2002:

  "Those who are opposed to nuclear on environmental grounds have to weigh up this difficult balance … Are we going to continue with global warming or are we going to mitigate it?"

  Let me say for the record that we have an open mind on the future of nuclear energy. Its environmental benefit is its technology, which emits no CO2 or other greenhouse gases during generation, but of course there are concerns over cost, decommissioning and long-term storage. Its long-term use will depend on Government policy now—it cannot be postponed because signals have to be given—on the economies of the new lower-
  58
  cost, safer plant, often from France; on the pace of deliverable research on renewables; on making nuclear fusion a reality; and on the progress of the international market.
  Mr. Russell Brown:Many Labour Members are in favour of the nuclear option being far wider than at present. I am not aware of any company or organisation that is falling over itself to build nuclear reactors. Is that not at least partly a result of the failure of British Energy, which is yet another failure of privatisation?
  Mr. O'Brien:The hon. Gentleman encapsulates a number of issues that are highly relevant to the debate. The first is that, leaving aside decommissioning, which is of course what the Bill intends to do, nuclear does not receive subsidies in the same way that wind farms do, so it has to be said that the economics of new nuclear plants are not particularly attractive. The hon. Gentleman's points are more of an operational nature. The key issue is that Government policy should give signals about the expectation for the fuel mix for the delivery of our energy supplies. That cannot be postponed because the industry and providers need that knowledge, in proper time, to inform the decisions that they have to make on basic commercial and economic grounds.
  Mr. Nigel Evans:Some people think that anything to do with nuclear is bad. Is it not bizarre that, although some Members say no to nuclear in any form, they are only too happy to import electricity from France, which draws 70 per cent. of its power from nuclear energy?
  Mr. O'Brien:I agree—in fact, I think that the proportion is larger, at about 80 per cent. More to the point, because the French have been able to retain a vibrant nuclear industry, they have developed a nuclear energy capacity that is as safe, if not safer, more efficient, and even cheaper for the purpose of production.
  My final point in response to the hon. Member for Dumfries (Mr. Brown) is that he should remember that nuclear-derived energy is subject to the climate change levy, despite the fact that nuclear produces no carbon dioxide emissions.
  Mr. Bill Tynan:The document "The Cost of Generating Electricity" has been mentioned. The hon. Gentleman says that nuclear energy is not economic at present. Does he not accept that, according to the costs set out in that document, it is very competitive with any other energy source?
  Mr. O'Brien:I am happy to confirm that position.
  Mr. Robathan:My hon. Friend knows that I am a great supporter of wind energy, but may I suggest an option for plan B if wind energy does not come up to expectations? If—God forbid—Labour were to win the next election and put in place a plan B that consisted of enhancing nuclear plant, what would my hon. Friend's reaction be?
  Mr. O'Brien:That is an interesting speculation, which I might have explored later in my speech.

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  As I understand it, Ministers are—perhaps unsurprisingly—involved in a deep ideological argument on the subject of nuclear that has the potential to do a lot of damage both to themselves and to the industry. On the one hand, we have the Secretary of State for Environment, Food and Rural Affairs, who last month told a newspaper that the prospect of new nuclear is

  "not valid … come back in another generation".

  The breathtaking arrogance and irresponsibility of that statement beggars belief. On the other hand, in December last year, the Minister for Energy, E-Commerce and Postal Services told the all-party nuclear energy group that

  "we need the possibility of new nuclear build",

  and only last Thursday, in response to Lord Tombs's unstarred question, which was supported by my expert and senior colleagues, DTI Minister Lord Sainsbury of Turville said,

  "The first question is whether we should consider nuclear as part of the…plans for energy. The position of the Government is clear. We think that nuclear may well play a large part, for many of the reasons given in this House during the debate, including environmental issues and security of supply. But that is one issue, and that is why we believe that we must keep our option open."— [Official Report, House of Lords, 6 May 2004; Vol. 660, c. 1268.]

  While Ministers continue to argue, nuclear generation's present 20 per cent. contribution to our power is declining, and it is expected to be as little as 2 per cent. by 2023. At the same time, our nuclear expertise is dwindling. It is simply not good enough for Ministers to postpone the debate until 2006. As my hon. Friend the Member for Blaby (Mr. Robathan) suggested, that might have something to do with the timing of the general election. The White Paper states that

  "even without new build the nuclear fuel cycle, power generation and environmental restoration sectors are likely to need around 19,000 graduates and skilled trades people"

  However, a parliamentary answer in the Official Report of the other place records that

  "no universities currently offer undergraduate courses specifically in nuclear science and engineering."—[Official Report, House of Lords, 26 June 2003: Vol. 650, c. WA42.]

  There are consequences to ducking the hard decisions today and coming back in another generation, as the Secretary of State for Environment, Food and Rural Affairs says we should do. We must find a way to make progress, because if the Government do not come out from under the covers, the House, the industry and the country will not be able to judge the desirability and doability of future nuclear build based on proven fission technology.
  It is unacceptable that the White Paper clearly states:

  "In the long term, nuclear fusion could provide power generation from an abundant fuel source with zero carbon emissions and without the problems associated with long-term highly radioactive waste",

  when the DTI's most recent departmental report reveals a cut in funding for research into nuclear fusion from £15 million a year to zero for the foreseeable future. Either the Government believe what the White Paper says, in which case they should make the appropriate
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  investment, or they do not, in which case they should state once and for all that the nuclear option is now closed—and wrestle with the consequences of that as a policy. At present, the official position stated in the White Paper is that "The initiative" for any nuclear build "lies with the market". That statement is somewhat cynical, as Ministers are fully aware, especially as the White Paper concedes openly that competitive markets cannot deliver some wider policy objectives.
  That approach merely reaffirms the importance of our security of supply amendment in attempting to ensure that the Government do not shirk the tough decisions. At the moment, it seems, the only direction on which the Government are clear is signing up to an EU constitution that threatens to include an energy chapter, which, against the UK's national interest, would bring responsibility for security of supply under the control of Brussels rather than Parliament. Or is it just part of the tidying-up exercise? Taxpayers expect leadership on energy policy, but all they get is a mixture of high aspirations on renewables, low cynicism on the future of nuclear, blazing ministerial rowing, which has been kept largely behind closed doors, and a bloated and bureaucratic research and skills structure.
  Science research councils have an enormous budget of £2.5 billion, yet for several of them administration costs represent 50 per cent. of income. Much of the energy research is being directed into renewables, and, as I mentioned, funding on nuclear fusion has been cut altogether. Meanwhile, the inordinate rise in the DTI's resource budget has been matched by bureaucratic proliferation of the various research and funding channels for energy, which now include the science research councils, the new sector skills councils, the Sector Skills Development Agency, the Learning and Skills Council, the regional development agencies, the Small Business Service and the Carbon Trust. A report entitled "Science and the RDAs" published last week by the Select Committee on Science and Technology in the other place concluded:

  "The main message of our Report is the need for coherence, longer term perspectives and reduced bureaucracy".

  I wholeheartedly concur with that conclusion.
  This Bill, as now hugely improved by their lordships, is worth supporting subject to the detailed scrutiny and further improvements that we hope to secure in Committee, led by my hon. Friend the Member for Tewkesbury (Mr. Robertson). But, to substantiate the arguments that I have outlined, has the Secretary of State taken the time to study the serious, important and timely PricewaterhouseCoopers global survey published four days ago, in which security of supply is now seen as the leading strategic aspect of the power market? It states:

  "Last year security of supply barely rated as a concern among European and US Companies in our Movers and Shakers survey. It is now top of the industry's agenda. The blackouts have raised serious questions about the adequacy of transmission facilities, and whether the right signals are being given to the market in relation to ensuring sufficient investment in the required infrastructure."

  British businesses are not alone and are right in highlighting security of supply as a key issue facing them, whereas the Government, in whom responsibility lies with the Secretary of State, are deliberately putting

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  their heads in the sand over the future of the UK's secure, safe, affordable and sustainable energy supplies. As the fourth largest economy in the world, we have a right to expect the right signals from the Government and the regulator to create the conditions whereby the market can deliver security of supply and reassurance, for businesses and consumers alike, that there is a sustainable long-term strategy for the future.
  It is about time that the Department discovered its focus and started delivering some bang for its bucks—all £8.2 billion of them—starting with setting out its medium to long-term strategy for the future of our energy supplies. It would be politically cynical in the extreme to put that off until after the general election, not least as price signals and investment decisions must be made now—as I said in response to an intervention from the Labour Benches—to stop the black hole becoming too big to fill or too high a risk of a gap between supply and demand. It is the responsibility of the Government of the day, and if they will not come forward with a policy on medium to long-term UK energy strategy, or at least a transparent debate in front of the people of this country, given the huge resources and access to expertise that they have at their disposal, which is not available to the Opposition, they should make way for a Conservative Government who will do so.
  Mr. Deputy Speaker (Sir Michael Lord):Order. Before I call the next Member to speak, I remind the House that Mr. Speaker has placed a 10-minute limit on all Back-Bench speeches, which applies from now.
  5.38 pm
  Dr Jack Cunningham:Twelve thousand or more people work at British Nuclear Fuels' Sellafield plant in my constituency. What is in the Bill—and, equally importantly, what is not in the Bill—is therefore of huge importance to them. It is important to the future social, economic and environmental well-being not only of them and their families but of their communities in Copeland and Allerdale.
  Tony Cunningham:I thank my right hon. Friend for including my constituency in his remarks. Does he agree that what is needed is a sense of responsibility from both the nuclear decommissioning authority and the Government towards the communities of west Cumbria, because many of those people have spent their entire working lives in the nuclear industry?
  Dr Cunningham:I agree, and I shall return to that theme shortly.
  Those workers are dedicated, skilled, mature, reliable men and women, who safely manage, on behalf of the nation, hugely important nuclear installations. They deserve our support and gratitude.
  I especially welcome part 2, which would create a nuclear decommissioning authority. For many years, Governments of both parties have failed to address the issue in a coherent, long-term way, and I congratulate my right hon. Friend on making progress with it. What I regret—here I agreed with at least part of what the hon. Member for Eddisbury (Mr. OBrien) said—is the absence of a long-term commitment to the inclusion of nuclear energy in the nation's energy strategy.
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  The International Energy Agency estimates that $10,000 billion of electricity-generating capacity will be required worldwide in the next quarter of a century. Energy demand in that time is forecast to increase by 66 per cent. Global population growth, global economic growth, global warming and the Kyoto accord, and our obligations that flow from those things all indicate the need for long-term thinking about secure energy supply. The Bill, I regret to say, misses an opportunity to address those important issues.
  In the United Kingdom market, doubts about regulation, about emissions trading and about the EU's future commitment to emissions trading after 2007 affect long-term investment, as do doubts about aims for wind power. When we look at energy investment we are looking at very long-term projects, whether they involve wind power, nuclear power, coal, gas or anything else. Planning, too, must be long-term, and if we fail to make decisions when they are due we shall risk problems with supply for the future. I have no problem with the Government's commitment to wind power, but I do not think we should get too carried away by the contribution that it can actually make.
  If the Government's objectives are to be fulfilled, we need to build 20 times 2 MW of capacity every week in this country, from now until 2020, in the hope that we shall produce 20 per cent. of our electricity. That is an heroic assumption. Moreover, wind power is by definition an intermittent source of supply. It cannot supply base load electricity and must be backed up by conventional generating capacity. Estimates suggest that the UK's electricity infrastructure requires some £70 billion of investment over the medium term. Against a background of uncertainty, achieving that seems unlikely.
  The UK consumes about 2.5 per cent. of world energy. That figure will fall as we see continued growth in the People's Republic of China, India and other developing countries. UK renewables will meet 0.3 per cent. of world energy demand if we reach all our renewables targets by 2020. In other words, our renewables efforts have a minuscule impact on world energy supply, and therefore a minimum impact on carbon production globally. We should bear that in mind.
  We can set against that the fact that we as a country are supplying coal-fired generating stations to developing countries. By contrast, the Governments of countries including China, Finland, France, India, Japan, Russia, Sweden, South Korea and the United States have recognised that nuclear generating capacity for the future is essential. Our Government should accept that reality to ensure that the same is possible for the UK.
  Nuclear power is a zero-carbon electricity source. It should be exempt from the climate change levy and should be included in renewables targets for generators. Simply to say that the nuclear option is being kept open is not sufficient—we have to do something to keep the option open. Last autumn, the Government's report on research and development said that the industries that invested most in R and D were the most successful. It is the same for economies: the economies that invest most in R and D are the most successful. I would like us to invest more not simply in R and D on nuclear power, but

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  in R and D on clean coal technology and combined and heat power systems, because they, and only they, with gas, are capable of generating base-load electricity. For all their merits, renewables cannot do so.
  I strongly support my right hon. Friend the Secretary of State's decision not only to create a nuclear decommissioning authority but to establish its headquarters in west Cumbria. I cannot understand the pusillanimity of the civil service about the exact location. The West Lakes science and technology park already hosts a cluster of nuclear-related industries and is about 10 miles from Sellafield, where 60 per cent. of the nation's legacy is. It seems a no-brainer to look at any other site for the location of the headquarters. I hope that eventually people will see the sense of that. I warmly welcome those decisions.
  The work force in west Cumbria have the skill, experience, commitment and trust of local communities to deliver the decommissioning and remediation work, which it is broadly estimated has a value of about £50 billion. I want the Government to ensure that the west Cumbrian economy benefits from the changes that British Nuclear Fuels and others will be obliged to grasp. British Nuclear Fuels has established the British Nuclear Group. The United Kingdom Atomic Energy Authority should not be overlooked. Both organisations have considerable experience in successfully decommissioning major nuclear facilities.
  West Cumbria very much depends on the nuclear industry for employment. The people who work in the industry support the policy objectives set down for their industry by the Government. Ironically, however, because of the delay in British Nuclear Fuels bringing forward its near-term work proposals, there are already strains in the supply chain, reflected in the threat to jobs in west Cumbria, even before the nuclear decommissioning authority has come into existence. I urge the Secretary of State to look urgently at those problems. It would be ironic in the extreme if, in looking for and supporting a way forward to deal with that national legacy, the west Cumbrian economy, far from benefiting from the changes, were to suffer damage. That would be unacceptable, and those communities' commitment and support for the future of the industry would be lost.
  BNFL and its suppliers have had massive inputs into the west Cumbrian economy in salaries and through the supply chain. Those problems need to be addressed urgently, as does the length of contract that the NDA will award when it comes into being. We have so many objectives already on work programmes at Sellafield—some of those objectives have been imposed by the nuclear installations inspectorate. It would be bizarre, not to say reckless, to have a hasty, short-term contractual approach to these matters that would threaten some of the existing objectives.
  In looking at the future, we need to consider skills. The nuclear skills academy should be located at West Lakes science and technology park. We need to look at the work of the taskforce that the Secretary of State has rightly established, not least because, as we speak, 7,000 vehicle movements a day take place at Sellafield, yet the Department for Transport is talking about de-trunking the only trunk road in west Cumbria. That is an obvious
  64
  example for the Secretary of State's taskforce to grasp. It should say, "We simply cannot do that, especially at a time when there are proposals to bring low-level nuclear waste by road from Dounreay to west Cumbria, adding to the burden on the roads." That simply is not something that I or the people in west Cumbria are willing to accept.
  5.50 pm
  Mr. Andrew Stunell:We welcome the fact that we have an energy Bill before us today. They do not come along very often; the last substantial Bill on this topic became the Utilities Act 2000. It is therefore with some regret that I say that the Bill misses some substantial opportunities and makes some provisions that we believe are mistaken.
  The Bill fails to set out any clear steps by which the Government's White Paper is to be implemented, and fails to increase the chances of them achieving their targets. As far as we can see, the Bill does nothing to reverse the increase in carbon dioxide emissions recorded in three of the last four years. On the other hand, it entrenches in law the huge bail-out for the nuclear industry. My hon. Friend the Member for Lewes (Norman Baker) will say something about that if he catches your eye Later. Mr. Deputy Speaker. The Bill also extends the discredited new electricity trading arrangements.
  Dr Jack Cunningham:The hon. Gentleman talks pejoratively about the nuclear industry and mentions a "huge bail-out". Does he recognise that the overwhelming part of the nuclear legacy—established over 50 years in this country—has nothing at all to do with BNFL, but arises from the military programme carried out by successive Governments? It is a national legacy and liability, not a liability of the current civil nuclear industry.
  Mr. Stunell:The right hon. Gentleman is extremely knowledgeable about these matters and will recognise that the Bill provides for the purchase of existing civil nuclear power reactors by the nuclear decommissioning authority from the private sector and BNFL. Therefore, what I said was legitimate. I agree with him on the requirement that the NDA should have a social commitment to the local west Cumbria community. I was sorry to hear the Secretary of State indicate that she might want to reverse that in Committee.
  The Bill, as outlined by the Secretary of State, covers three broad and important areas, one of which is nuclear decommissioning. We broadly welcome the establishment of the NDA and the opportunity to separate the operation of that authority and the issue of decommissioning and waste disposal from the semi-commercialised sector in which it has been placed in the past. However, the Bill still provides no clear direction or long-term system for managing and disposing of nuclear waste, an issue that we will want to test in Committee.
  I was interested to hear the hon. Member for Eddisbury (Mr. O'Brien) criticising the Government's failure to set out the future of the nuclear industry; he described it as a missed opportunity. He then quoted, at some length, from various Government documents

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  about their uncertainty about the future of the industry. He went on to say that he did not have an idea, or a Conservative policy, to put on the table. He was kind enough to outline Liberal Democrat policy, which is that the existing plants should continue in use for as long as they are safe and economic, but that there should be not be a new generation of civil nuclear plant built.
  I shall move on, appropriately, to deal with the second section of the Bill on which I wish to comment in detail: offshore renewables. Broadly speaking, we welcome the proposals in the Bill on this subject but, again, the Secretary of State has missed an opportunity to say how she intends to ensure that Government policy in relation to the White Paper, the Kyoto commitments and the Government's further commitment to have a 60 per cent. reduction in carbon emissions by 2050 is achieved to any significant degree.
  Mr. Kevin Hughes:I thought that the Secretary of State and the Government had made it clear: it will all be left to market forces, which will deliver everything that we could possibly want. Not only that, but there will be no problem with security of supply. I think that is what the Secretary of State was trying to say from the Dispatch Box.
  Mr. Stunell:That intervention is more welcome to me than it is to the Minister.
  The House of Lords has referred to the consideration of further technologies. Given the Government's targets, it is astonishing that, again, the Secretary of State seemed to say that she wants to backtrack on that in Committee. We shall try to prevent her from doing so.
  Thirdly, the Bill deals with the extension of NETA—new electricity trading arrangements—to Scotland. We have identified problems with NETA, some of which were drawn of the attention of the Secretary of State's predecessor during the passage of die Utilities Act. We have seen the shutting down of two thirds of the combined heat and power generating capacity in this country and the total collapse in investment in CHP for the future.
  The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms):The hon. Gentleman says that we have seen the shutting down of two thirds of CHP capacity. If he reflects on that, he will realise that that is not the case. Will he correct that?
  Mr. Stunell:I was trying to say that there has been a significant reduction in the amount of electricity contributed to the grid from the combined heat and power plant already installed because of the collapse that has taken place as a result of NETA.
  Mr. O'Neill:Is not it also the case that CHP plants are run on gas, the price of which has gone up greatly? Coal is cheaper and although it is environmentally less friendly, it is certainly more attractive to the accountants who often make the decisions.
  Mr. Stunell:Indeed. CHP plants, with an efficiency of about 70 per cent., are being shut down, whereas coal plants, with an efficiency of 35 per cent., are being
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  reopened. Those plants are only half as efficient, producing twice the carbon dioxide emissions for a given amount of electricity.
  The Lords have done their best to improve the original Bill and have made some important improvements. I was disappointed to hear that the Secretary of State intends to attempt to reverse every improvement made by the Lords on which she chose to comment. I hope sincerely that she can be talked out of that in Committee.
  My colleague in the other place, Lord Ezra, christened the Bill the Energy (Miscellaneous Provisions) Bill, which is pretty much what it has become. It is not the decisive move forward that is essential if we are to achieve the UK's Kyoto targets, the aspirations in the performance and innovation unit report or the aims of the White Paper. It does not even plug the gaps that were described to the Government during the passage of the Utilities Act four years ago.
  Mr. Evans:After eight minutes, I remain unclear as to what the hon. Gentleman is saying about wind power. I saw his party leader being interviewed by Jeremy Vine yesterday on "The Politics Show" and, quite frankly, he took a hammering. The accusation was that the Liberal Democrats were in favour of wind power generally, but not in specific cases. Would the hon. Gentleman care to say whether the Liberal Democrats are in favour of wind power?
  Mr. Stunell:We are certainly in favour of all renewables where appropriate. Our policy paper that was passed last year set out those terms, and I have previously referred hon. Members to the book I have written on the subject. The hon. Gentleman is welcome to read it.
  Year by year, step by step, little by little, the Government are backing away from the targets that they set. Carbon dioxide emissions are going up and the energy efficiency targets are being watered down: last week the target went down from 5 million tonnes of carbon to 4.2 million tonnes, a reduction of 16 per cent.
  Mr. Timms:The hon. Gentleman made that point in an intervention earlier. Although we said in the White Paper that we thought that there would be about 5 million tonnes of carbon savings from household energy efficiency, and we now think that there will be 4.2 million tonnes, that is more than made up for by the increase that we now expect in business energy efficiency savings compared with what the White Paper said. The total is now 12 million tonnes of carbon savings, rather than the 10 million mentioned in the White Paper.
  Mr. Stunell:That is a disappointing reply, because the domestic sector of our economy uses 30 per cent. of our energy. If we are not going to make a significant improvement in the efficiency with which we use energy in the domestic sector, the Government's chances of reaching their overall targets are considerably reduced.
  NETA has been a serious handicap to renewables, and it is sad that the Government now plan to extend it to Scotland. The Minister is well intentioned, and so were his predecessors, but the policies change and the intentions are not delivered. In seven years, we have had

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  five Energy Ministers and three different policies, and none of them have had any clout. There has been a long list of them, and it was only when the hon. Member for Leeds, West (Mr. Battle) was Energy Minister in 1997 that we had a Minister solely dedicated to energy. He was followed by the right hon. Member for Airdrie and Shotts (Mrs. Liddell), who was Minister for Energy and Competitiveness, then the right hon. Member for Neath (Mr. Hain), who was Minister for Energy and Competitiveness, then the right hon. Member for Cunninghame, North (Mr. Wilson), who was Minister for Industry and Energy then for Energy and Construction. The current Energy Minister is doing his best, but his main jobs are supervising the closure of thousands of post offices and trying to wean the Child Support Agency staff off their pocket calculators as yet another Government IT project bites the dust. It has so often been the case that energy policy has been a hobby for the DTI.
  Mr. Jack:The hon. Gentleman talks about an energy policy. Given his party's support for the eventual closure of Britain's nuclear industry, and if that capacity were replaced by renewables, could he spell out to me in some detail how the base-load requirement for UK electricity supply would be met, against a background of the desire to reduce carbon dioxide emissions, which has been the substance of many of his remarks so far?
  Mr. Stunell:I am more than happy to do that, although I do not know how far you want me to stray from the specific topics under discussion, Mr. Deputy Speaker. My booklet is, I believe, available through the House of Commons Library.
  Mr. Kevin Hughes:The hon. Gentleman has done an injustice. Before he gave way to the right hon. Member for Fylde (Mr. Jack), he said that the DTI treated energy like a hobby. That is unfair, because most people take their hobbies very seriously.
  Mr. Stunell:May I assure you that we did not practise this routine before we started, Mr. Deputy Speaker?
  The DTI officials are only too happy to fill up this place's time with endless market meddling and technical fiddling. Rather than spending day after day on the difference between NETA and BETTA, we would be better in Committee, although the Minister's Department would be horrified, to turn the Bill into what it should be: the foundation of a long-term sustainable energy policy. Such a policy should be designed to implement the action needed to reach our Kyoto obligations by 2010—we are going in the wrong direction on that at the moment—to achieve the royal commission recommendations of a 60 per cent. reduction by 2050, which I understand the Government believe they are committed to, and to reshape our production and use of energy to achieve those aims. My hon. Friends and I will seek to do just that in Committee. We will vigorously defend the limited gains made in the Lords and push for further significant improvements to the existing provisions. We will also want to give the Bill some backbone and bottle so that
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  the half-dead energy mouse that the Minister has dragged into the House today can be taken back to the Lords with something of a roar.
  To do what is needed does not require a great deal of rocket science. It does not need a multiplicity of new technologies, it does not need miracles and it does not, funnily enough, need a great deal of money. Given that a quarter of our carbon dioxide emissions come from our homes and extra energy efficiency in that sector cuts fuel bills, increases home comfort and has major health benefits as well as carbon dioxide reductions, savings could be made if we invested in that field. I believe that to achieve an effective energy policy and a piece of legislation that reflects that policy, some wholehearted and full-time commitment is needed from the Government, with a conviction at the most senior levels of Government that a sustainable energy policy is a public good, an electoral asset and, on the bottom line, a big plus. My Liberal Democrat colleagues and I will do all that we can during the Bill's passage to persuade the Government of the urgent necessity to get their head out of the sand, to beef up the Bill and to give the United Kingdom a sustainable energy policy.
  6.7 pm
  Mr. Martin O'Neill:The Bill has been somewhat dismissed as a miscellaneous provisions Bill, but I remember asking for such a piece of legislation because I felt that it would be one of the quickest ways to meet a number of our urgent requirements. One of those was the need to secure a nuclear decommissioning authority, which was necessary to address systematically the legacy to which my right hon. Friend the Member for Copeland (Dr. Cunningham) has already referred.
  We now have a different way of operating, because we tried in the past at Dounreay, Sellafield and other places to bring in outside contractors, and there was chaos in the mid-1990s as a consequence of the way in which that was handled. We now have a more rational structure, and a shadow agency will operate for a 12-month transitional period before the Bill takes effect, assuming that it passes all its stages. We can therefore foresee two outcomes. First, we will have a better way of handling nuclear waste and the nuclear legacy—the two are different—and secondly, that will be done in a way that is more commercially competitive but uses in many cases all the skills and capabilities that still reside in British Nuclear Fuels, the United Kingdom Atomic Energy Authority and British Energy.
  Dr Jack Cunningham:I support the legislation, as I have made clear, but does my hon. Friend recognise that it would be an error to rush into hasty decisions and short-term contracts in an industry as sensitive and critical as the nuclear industry? I beg him to think about the hasty rush into contractorisation in the railways, and remember its consequences. We should avoid that at all costs.
  Mr. O'Neill:I regret it if I have given my right hon. Friend the impression that we want to return to something akin to the bad old days of the '90s. We have to recognise, however, that there may well be other types of management approach to the activity necessary to do the job, and that although the people in BNFL, the

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  UKAEA and British Energy have a tremendous record across the world, they might not necessarily have all the skills and experience needed. The decisions that my right hon. Friend and I are discussing cannot be taken rapidly, but we have to start the process, and we must be far more systematic. Indeed, part of the burden of his remarks was that we have taken too long to get where we are now.
  In the background, there will be the debate about nuclear power. It appears that there are those who would like the Government to rush to a decision on nuclear power, even if they cannot make up their own minds—or, in the case of the Liberals, have totally closed minds. Before any decisions are taken about nuclear power, we must be satisfied that the European Commission is prepared to accept the support package granted to British Energy when it was in crisis. We must also show potential investors that the UK has the capability to build and run nuclear generation capacity, and we must choose the type of reactor best suited to our needs. At the moment, there is a South African, an American and a Canadian option. Any one of those could stand up to close scrutiny, but it would be a rash person who would rush to judgment on them.
  We also have to decide how many stations we want. The Conservatives built Sizewell and no more. They should have built more if they wanted a serious nuclear contribution, going on into what was then the next century. They had plenty of time, but they did not do it. Moreover, if we choose a reactor, we should commit ourselves to building several station—and if we are to do that, we need to win the support not only of investors but, more importantly, of the people in whose areas the power stations will be located.
  Such decisions cannot be taken overnight; they have to be taken over time. July is the earliest time for the European Union, and there is a succession of other factors. There will be a general election in between, but people should not make cheap political capital out of accusing the Government of indecision, because there are so many major decisions that need to be taken over time. I would be happy for decisions to be made earlier, but I do not want the wrong decisions to be made for the wrong reasons, and the reactors to be located in the wrong places.
  Mr. Laurence Robertson:I agree that careful consideration is needed, but as the next nuclear plant is due to close as soon as 2008, does the hon. Gentleman not think that the Government need to make their mind up about that plant, if nothing else?
  Mr. O'Neill:I am not talking about a piecemeal approach. The capacity of several of the Magnox stations is fairly small; their advantage is that they are connected to the national grid and that, by and large, they are in areas where there is a tolerance of their presence. We can come to decisions about them in the medium term.
  I do not have the time to go into my reasons now, but I think that 2012 is the earliest possible date when—with all the planning problems, if there are any, are overcome, and the construction has been dealt with—we could expect to see something beginning to be tested and run. It will be a close-run thing, but I do not see us being
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  able to do that any earlier. Perhaps this is a debate for another day, but it is important to have the wiring and the infrastructure in place in the United Kingdom, so that we can make the best of the assets that we have.
  That is why I welcome the establishment of the British electricity trading and transmission arrangements—BETTA. I do not know what planet the hon. Member for Hazel Grove (Mr. Stunell) lives on, but some of us are concerned about the prices that people have to pay for their electricity. The pool system operated on the basis of prices 40 per cent. higher than they should have been, and driving down those prices was the achievement of NETA—the new electricity trading arrangements.
  I am glad that my right hon. Friend the Member for Coatbridge—or at least, that is where she comes from. I think her constituency is—[Interruption.] Ah yes, it is Airdrie and Shotts, although my right hon. Friend actually comes from the other place. It is all very confusing; Lanarkshire is a complex area, and the geography is almost as difficult as nuclear power. As I said, I am glad to see my right hon. Friend the Member for Airdrie and Shotts (Mrs. Liddell) in her place.
  The achievement of NETA was to drive down electricity prices, not as much for the domestic consumer as we would have wished, but certainly a great deal, and now we want a trading system that covers the whole of the UK. Of course, there are problems. A number of my constituents work in Longannet power station, which produces 2,400 MW, and is one of the biggest in Europe. It has had considerable problems with the rapid changeover from NETA to BETTA, and I make a plea for some transitional arrangements that would soften the cost changes.
  The situation is somewhat complex, and I wish those who will serve on the Standing Committee well; they will be able to go into that matter in some detail. All that I shall say now is that although the cost of sending electricity generated in the centre of Scotland to the markets of England will have to be paid for, the change in price will probably be rather more dramatic than necessary unless some kind of transitional arrangements are made. I record that now as a constituency point.
  Some hon. Members have talked about combined heat and power. Large CHP plants are important, and those possibilities are not being properly addressed. ILEX has produced some research, and I know that the Secretary of State did not have much time, but I do not believe that she did that research justice this afternoon. Large CHP plants are highly efficient, and can make a contribution without the bedevilment of windmills and suchlike. They should be given some status in the context of the renewables obligation, because waste is a renewable facility.
  There is ill-concealed delight on the Opposition Benches that the revising capacities of the House of Lords have been exercised before we have even had the opportunity to say anything about the Bill. I am interested to see that the Secretary of State already has an obligation to keep the lights burning. Some of us who are a wee bit longer in the tooth can remember how one of the authors of that provision made a major contribution to our thinking on energy policy 30 years ago. That was probably the last time that Lord Jenkin made any such contribution—and it was not that the

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  Secretary of State should be responsible for energy policy, but that we should brush our teeth in the dark during the power cuts that resulted from the coal dispute in 1974.
  That refined obligation inserted at the beginning of the Bill is nothing more than mischievous. The provisions covering the role of Ofgem, the regulator, are clear, and so is the link between Ofgem and the Secretary of State. If the lights went out and there were problems, after the first 45 minutes it would not be the power companies but the Secretary of State who, regardless of political party, would get the blame.
  It is irresponsible to talk about Britain being in danger over security of supply—certainly for the next decade. My colleagues on the Select Committee and I have examined the nature of power cuts in recent years, and we have found that the problems were not akin to what took place in California or Italy. Mistakes were made, and there were maintenance problems, but scaremongering for simplistic political gain is irresponsible in such an important area.
  I would like to think that the Bill will be seen merely as a contribution to the jigsaw puzzle of a new energy Britain, which will not create the emissions, such as greenhouse gases, that we create now. I hope that we will be able to move on. We have set ourselves a target for 2050, and one piece of legislation will not do everything. The Bill, however, is a modest start, and I welcome it.
  6.20 pm
  Mr. Andrew Robathan:It is a great pleasure to follow the Chairman of the Trade and Industry Committee, the hon. Member for Ochil (Mr. O'Neill), who speaks with real authority. I hope that he does not regard any of my remarks as scaremongering, because that is not my intention.
  A bright young researcher of mine—he has recently come down from Oxford—with whom I discussed global warming, agrees that climate change is taking place, but he questions whether it is man-made. In anecdotal terms, when the weather in February is warmer than that in May, it is obvious that something is happening to our climate. I was therefore pleased to be able to show my researcher a report published last week in The Times. It is an important report, given that there are still people in America, for example—perhaps even in the Bush Administration—who question whether man has any role in climate change. The report states:

  "This lack of tropospheric warming has long puzzled scientists, as it is predicted by all the major models of climate change. It has also been seized on by a small but vocal minority of scientists, who have used it to raise doubts about whether global temperatures are rising at all. The enigma, however, has been explained"

  by a report by the university of Washington in Seattle.
  I am not an expert on tropospheric warming, but it is now entirely clear that we must address man's actions. To that extent, I believe that climate change has been caused by our actions, and I applaud the Government's stated intention to tackle that issue in the Energy Bill, but I question whether the Bill and the White Paper will achieve their intention to reduce emissions, while at the same time securing our supply.
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  I do not wish to scaremonger, but anyone who saw the recent television programme "If … The Lights Go Out"—it was set, I think, in the 2020s—must be concerned, especially given that the topical trigger for the lights going out in Britain was a Chechen terrorist attack on a gas pipeline in Russia. Of course, yesterday the Chechen President was assassinated.
  The Government's concentration on renewables is laudable. I was keen on renewables long before I entered Parliament. I have a solar photovoltaic roof, which was supported by the Minister's Department, at great cost. I also have an anemometer on a farm behind my house—as Members will know, an anemometer measures wind speed—and I hope to be able to generate wind energy. There could be planning problems and I might lose a few constituency votes, but never mind—I believe in putting my money where my mouth is.
  The photovoltaic roof is very expensive, even with a Department of Trade and Industry grant, and I have so far found the electricity generated fairly disappointing, although it is being monitored. The wind energy generated is excellent, but of course, wind is intermittent and such energy cannot be the whole answer. Tidal and wave power—maritime energy—may have their part to play, but not yet. Hydrogen cracked from renewable sources and stored in fuel cells also has its part to play. The technological developments are very exciting, but they are for the future, not now.
  Most observers do not believe that the Government will achieve their target of 10 per cent. generating capacity from renewables by 2010. On the other hand, combined heat and power is a proven technology. The Government had two targets for that as well, the first of which was 5 GW generating capacity by 2000. We have yet to meet that target. The second target was 10 GW generating capacity by 2010, which to some extent is why our noble Friends in the House of Lords introduced clause 120.
  According to a briefing from the Combined Heat and Power Association, CHP can play a major role in achieving the Government's carbon reduction targets because it improves competitiveness by reducing energy costs. It is a highly efficient means of energy production that converts 70 to 90 per cent. of fuel into energy. Yet the Government are not on track to meet their election manifesto pledge. CHP output has remained stagnant in the past three years. The hon. Member for Ochil mentioned the independent study by ILEX, which I commend to the Government. It could help them to meet their carbon reduction targets by incentivising the CHP industry.
  Mr. Blizzard:The hon. Gentleman has professed his support for wind generation, but is he aware of the briefing provided to Members by the British Wind Energy Association? It states that clause 120

  "would disrupt the working of the renewables obligation…mean a lower demand for renewables obligation certificates and…a lower price, which would affect the income of renewable generators."

  It continues by stating that

  "the Association does not believe this is the right time to be making…changes to the RO…before the review".

  because doing so will simply bring uncertainty and unpredictability into the equation.
  Mr. Robathan:I am grateful to the hon. Gentleman for that intervention, and I should point out that I do not accept everything that every briefing says. Apparently, 60 per cent. of UK renewables developers are in favour of clause 120, so there are two views in the renewables market. Before moving on from discussing the CHPA, I should point out that I am a vice-president of it, although sadly unpaid. So CHP is part of the answer, but it is not the whole answer. By forcing down prices, the new electricity trading arrangementsߞNETA—which was Government policy until recently, have scuppered CHP investment in the past two years. That is not what we call joined-up government.
  I turn to the energy mix, the excellent points made by my hon. Friend the Member for Eddisbury (Mr. O'Brien) and what is a major hole in Government policy. Renewables will not make up the 21 per cent. or so of our generating capacity that is currently produced by nuclear energy. By 2020, nuclear will supply only 7 per cent. or less of our capacity. As has been pointed out, no carbon emissions will be prevented by substituting renewable energy for nuclear; there is a hole, and it must be filled.
  I believe that, should this Government win the next general election—God forbid!they intend to announce a new generation of nuclear power stations, because that is the only way in which the hole can be filled. I find that distasteful, and any voters who might be influenced by such considerations would be surprised at that announcement. Such a policy might influence a campaign by Greenpeace, for example, in the run-up to the general election. Such actions are typical of this Government. I hope that the Minister will come clean and say how he intends to fill that hole. His predecessor, the right hon. Member for Cunninghame, North (Mr. Wilson), made clear his belief that further investment in nuclear is required. I look forward to an answer to that point in the winding-up speech.
  In terms of energy policy over the past five or six years, the views of the former Minister with responsibility for energy are interesting. In an interview for The Sunday Times of 17 August last year, the right hon. Member for Cunninghame, North, said:

  "Throughout my time as energy minister I was highly skeptical of the priority given by the regulator to driving down the generator price of electricity.

  Apart from anything else, by driving producers out of the market it became inevitable the price would rise later so any political gain is short term.

  Government has to some extent abdicated its power in this area by creating an independent regulator."

  I have a high regard for the right hon. Gentleman, and those points need to be mentioned. The closed-down generating capacity—the closed-down future supply—has largely been caused by Government policy, so they should take responsibility.
  Will the Government's policy as constituted in the Energy Bill work? In an article in The Times of 18 August last year, Sir Alec Broers, the president of the Royal Academy of Engineering, warned that renewable energy will not stop global warming or blackouts. He said that the Government's plan to generate 20 per cent. of electricity from renewable sources by 2020 is unrealistic, and that investment in nuclear power is critical if shortages are to be avoided. So he obviously does not think that the policy will work.
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  I finish by referring to a paper published last week by PricewaterhouseCoopers—"Supply Essentials: Utility Survey"—which was mentioned by my hon. Friend the Member for Eddisbury. It is a global survey, but the observations apply to the UK as well. It states:

  "Last year security of supply barely rated as a concern among European and US companies … it is now top of the industry's agenda.

  Renewable energy will not generate sufficient power to make up the shortfall as more nuclear plants are retired …

  The current reliance on coal will increasingly be replaced with gas, and longer term this raises issues of security of fuels sources …

  There is a need for swift action from utilities and regulatory authorities alike to prevent further grid supply collapses".

  These questions need answers, and I look forward to the Minister's answers to them in his winding-up speech.
  6.30 pm
  Mrs. Helen Liddell:I am grateful to you, Mr. Deputy Speaker, for calling me at this early stage, given that I have already had two name-checks this evening. I reckon that I was one of the longest-serving Energy Ministers in this Administration. May I say to my hon. Friend the Member for Doncaster, North (Mr. Hughes) that I never regarded the job as a hobby, especially not when I was trying to save the pits in his constituency and trying to secure compensation for his miners. His comment will cost him a cup of tea later.
  Mr. Kevin Hughes:I am sure that my right hon. Friend knows that I was not casting any aspersions in her direction. Things may well have altered since she and, particularly, my right hon. Friend the Member for Cunninghame, North (Mr. Wilson) left.
  Mrs. Liddell:Obviously I have scared my hon. Friend.
  The hon. Member for Hazel Grove (Mr. Stunell) said that Energy Ministers have often had other responsibilities, but he got it wrong about me, because I was the Minister for Energy and Competitiveness in Europe. There is a perfectly logical reason for that: energy policy is about competitiveness. I am surprised to hear Opposition Members talk with derision about the idea of reducing energy costs. If we are to be truly competitive, our industry requires low energy costs and, frankly, my constituents, who live in one of the coldest parts of the UK, very much require lower energy costs. That is why I am so grateful to the Government for introducing the proposals in the Bill for BETTA.
  It is important to end the position whereby Scotland has two major energy companies and its energy prices are higher than in the rest of the UK. We also need to tackle the substantial difficulties in Scotland in respect of the maintenance and repair of the grid. That is particularly important when we talk about renewables. Later on, my hon. Friend the Member for Western Isles (Mr. MacDonald) may wish to catch your eye, Mr. Deputy Speaker, because the great opportunities for the Western Isles will be limited if we cannot upgrade the grid.
  As a little anecdote, as I was preparing my thoughts last night, I suffered a two-hour power cut, but I did not blame the Secretary of State for Trade and Industry for

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  that, and her resignation would not have cooked my tea any quicker, which shows the illogicality of the new clause that was introduced in the other place. I blame it on some of the maintenance problems with the Scottish grid, which must be tackled, particularly in the remoter parts of the country.
  Mr. Weir:The right hon. Lady may be surprised to learn that I agree with some of what she is saying, but I am concerned about what she said about the lowering of costs through BETTA. I note that the Public Accounts Committee, in reporting on NETA, observed that although the cost of commercial energy for industry had decreased, it had not done so for domestic customers to anything like the same extent. Is she certain that domestic energy prices will fall under the proposed BETTA provisions?
  Mrs. Liddell:I believe that there is an important job for Ofgem in that respect, as there is for every Member of Parliament. Our constituents need to be alert to the fact that switching energy suppliers can produce cheaper bills at the end of the month. Particularly with pensioners and those on pre-payment meters, I always make the point that it is now possible to shop around for cheaper energy. I always encourage them to do so. We have further to go, however, to ensure that reductions in energy costs are passed on to the consumer in a coherent and transparent way. Transparency has often been lacking in the past.
  My right hon. Friend the Member for Copeland (Dr. Cunningham) and my hon. Friend the Member for Ochil (Mr. O'Neill) made powerful cases in respect of future nuclear generation. If I have one criticism of the Bill, it is that it misses the opportunity to further the debate about nuclear energy. I take wholeheartedly what my right hon. Friend the Secretary of State said about the skills, particularly with regard to the framework for the nuclear decommissioning authority. However, other skills are also required for the development of a new generation of nuclear capacity. My fear is that we are falling behind in failing to take up and be transparent about our desire for future nuclear generating capacity. I accept the fact that the market has not developed any proposals for new nuclear capacity, but there is a need for further debate and we must not be put off from having such a debate by the sort of intimidation that we face from the anti-nuclear lobby.
  Mr. Michael Clapham:I know that my right hon. Friend has worked hard for the energy industry overall. She makes a point about competitiveness and the cheapness of energy, but she will be aware that nuclear power is both inflexible and the dearest electricity on the wires.
  Mrs. Liddell:I know exactly where my hon. Friend is coming from and I take his point, but that does not necessarily mean that future generation will have that degree of inflexibility and high cost. My hon. Friend is a great champion of the coal industry. We should look further into the economics of clean coal technology as well.
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  My hon. Friend the Member for Ochil made a valid point about combined heat and power, as did the hon. Member for Blaby (Mr. Robathan). There are real anxieties about the future of CHP, and we are missing a trick in not paying more attention to the difficulties experienced in the CHP sector. I urge my hon. Friend the Minister to tell us in his summing up exactly where the Government are in respect of the future of CHP. I am very attracted to it from the point of view of energy efficiency, having seen it in very effective domestic use, particularly in Sheffield.
  I greatly welcome the Bill's proposals for the nuclear decommissioning authority. That represents important recognition of the scale of nuclear liabilities and of the fact that there is a competitive marketplace with international opportunities for decommissioning. We should reflect on the Finnish experience. The Finns were very fast off the mark—partly due to necessity, because they are so close to old reactors from the former Soviet Union—and keen to get ahead with decommissioning. There is a great market for it, and we should be throwing up the skills, experience and expertise to participate in that market.
  Mr. Lindsay Hoyle:Does my right hon. Friend agree that we have great skills in this country and that, especially in the light of problems in the former eastern bloc, failing to put them to good use on decommissioning is disappointing? Any Government who refused to support it would indeed be negligent. We are still the world leaders, even though many other countries are trying to catch up, and we must not lose those skills.
  Mrs. Liddell:I take my hon. Friend's point and I congratulate the Government on their vision in recognising that there are great opportunities.
  One of the side-effects of the management of our nuclear liabilities has been completely to alter the picture for British Nuclear Fuels. I note that when the decommissioning plans were announced, the chief executive of BNFL talked about opportunities for the new BNFL. I hope that the Minister will give us some idea in his summing up of how he views the future of BNFL after its many different traumas in recent years. I hope that we have now reached a point where we can see some way forward for it far into the future.
  I do not want to detain the House much longer. If I have one criticism of the Bill, it is that it is wrongly named. It is more an electricity Bill than an energy Bill, and huge issues of energy policy need to be debated in much greater detail—not least what is happening at the moment. The recent spike in oil prices will, because of the inter-relation of oil and gas prices, lead to an increase in gas prices, which will work its way right through the chain. Any competitive country concerned about energy policy should be looking in some detail at what is happening in international energy markets. I say that from two points of view—those of the United Kingdom as a consumer nation and as a producer nation. Increases in oil prices give a much more secure future to our North sea oil and gas industry as it moves into the third age. There are great opportunities before us, but there are also huge challenges that we must be prepared for.

  77]
  I wish all who serve on the Standing Committee a great deal of entertainment and enthusiasm. I well remember the Utilities Bill Committee; indeed, one Liberal Democrat Member's wife had a child during its progress, and I was most disappointed that that child was not called NETA. I wish the Minister well with an energy policy Bill that is a start, although I have a feeling that there is such change in the world that we will find ourselves returning to the subject again and again.
  6.41 pm
  Mr. Richard Page:I am no literary scholar, being more of a hit-it-with-a-hammer-and-hope engineer. I am, however, very much reminded by this Energy Bill of the words of William Blake's "The Marriage of Heaven and Hell". He wrote: "Energy is Eternal Delight"; the only problem is, Blake put those words into the mouth of the Devil. That is the problem: we all want energy, and we all want it to be eternal, but we also want it to be pollution-free, and there is the rub.
  The White Paper and the Energy Bill are full of warm words. Various energy conservation bodies can be cited as saying how much they welcome it, but there are some gaping holes, and important issues are not tackled. The realities of life are avoided.
  There is an energy that we on the Opposition Benches are prepared to mention but which the Secretary of State was not prepared to name, because the Government just do not have a policy. I can see the Minister busily looking through his notes and shifting in his seat, so I shall tell him that I mean the N word—nuclear. Where is the Government's nuclear policy? It is a simple question. How can the Government produce a Bill dealing with future energy without mentioning the future policy on 25 per cent. of today's production? I sense Government policy produced and dictated by focus groups. It is produced not by the reality of what this nation needs, but by focus groups. In American football terms, the hon. Member for Ochil (Mr. O'Neill) did a splendid job of running interference for the Secretary of State by asking why she should be responsible for any power failures. If a Secretary of State does not grant the power capacity to generate electricity in this country and there is a power failure, then that Secretary of State will be to blame.
  We have warm words, but they are a polite description for unrealistic alternative energy production. We have targets for wind farm production that are for the birds, because they have been plucked from the air. As a former Minister in charge of renewables, I favour them, but we cannot harness ourselves to a target that is unachievable. I shall not go through all the green energy sources, but unless there is a huge breakthrough in photovoltaics, such as those that cover the doubtless attractive roof of my hon. Friend the Member for Blaby (Mr. Robathan), or unless we discover that the capital cost of Wave power has been slashed, or unless we suddenly discover more efficient fuel cells, such targets destroy the credibility of the Government's other proposals, some of which I welcome.
  My right hon. Friend the Member for Fylde (Mr. Jack) referred to fish-and-chip recycling, which gives us our biofuels. That is fine, but unless the Government
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  give a commitment that they will give the biofuel obligation a couple of years or so, there will not be enough plants in place to take advantage of it, and we will not move towards improving on our targets. We will not have farmers starting to plant crops to use it, and we will not have enough plants to generate the fuel. We shall miss a golden opportunity.
  Mrs. Shephard:Does my hon. Friend agree that to have such a policy without putting proper structures in place would also encourage imports of biofuels, which has already happened in some degree?
  Mr. Page:My right hon. Friend is quite correct. That is why I said that the renewable obligation should be put in place in two years to give home-grown industry a chance to get into place instead of our, once again, drawing in imports. The Government are really good at allowing that: they had the fridge directive and hundreds of thousands of our fridges had to go abroad to be decommissioned because we did not give our home industries time to do that.[Interruption.] That is, of course, a sideline, Mr. Deputy Speaker, and we must not get into it.
  I welcome the fact that the Bill deals with various serious issues, such as the decommissioning of redundant nuclear generating plants and the disposal of radioactive waste, which have been of enduring concern to the House, the whole of Parliament and Governments over many years. I used to be Member of Parliament for Workington, and I am fully aware of the problems in that area. The words of the right hon. Member for Copeland (Dr. Cunningham) should be read and taken on board by the Minister and the Secretary of State, because they are the words of someone who knows what he is talking about. That will be difficult for the Secretary of State, but she must concentrate and plan for the future. Short-termism must be avoided.
  I am equally clear about the need for a public body to oversee the process of decommissioning and disposal, which must be done on a UK-wide basis, although I do not mean to say that all the Bill's provisions are completely satisfactory. I shall not go into the Westminster/Scotland relationship, but if I am fortunate, or unfortunate, enough to be placed on the Committee—I am not sure which of those categorises it—I may wish to probe the arrangements. It is one thing to commit the Secretary of State to consulting Ministers of the Scottish Executive on the appointment of the chairman of the nuclear decommissioning authority, but quite another to ensure their assent. I make that point because the Government seem to make many assumptions about Scotland, particularly that the political map will stay unchanged for ever and that there will never be a Conservative Administration up there—[Laughter.] Hon. Members may laugh, but as with everything else, the wheel will one day turn, just as it has in the past.
  Mr. Robathan:To counter the rather foolish laughter from some Members, does my hon. Friend remember, with a sense of history, that within our lifetime the Conservatives had an overall majority of votes cast in Scotland in 1950?
  Mr. Deputy Speaker (Sir Alan Haselhurst):Order. I think that, too, is an aside.
  Mr. Page:I am glad you remind me of that, Mr. Deputy Speaker, because I am far too young to remember anything of that nature.
  Where I do agree with Ministers is on the importance of creating the civil nuclear police authority. They are right to place its jurisdiction and the terms and conditions of its senior officers and constables on a basis comparable with those of the other UK police forces.
  No one will object to the principle of extending the scope for developing wind farms and renewable energy production beyond the current nautical limit of 12 miles. If this country and some of our European Union neighbours wish to do that, it will be absolutely desirable. If it can produce a reduction in fossil fuels, that will be desirable too. However, several hon. Members have already asked: what is the point of running down nuclear when there is no gain in CO2, reductions? We would just be swapping one thing for another. If the money and support going into wind farms were put into the nuclear industry, I wonder what the cost of generation would be, and there would be a stable base load that was not dependent on the strength of the wind at any particular time.
  I also welcome the Bill's aim of drawing Scotland into the wholesale market for electricity that operates in England and Wales. I was fascinated by the contribution of the hon. Member for Hazel Grove (Mr. Stunell) on that point. He talked about the book that he has written, and I shall rush to the Library to read it, because I found what he said rather difficult to support and comprehend.
  I hope that the powers that now control the market have realised the dangers of the cross-subsidy, where a generator, in conjunction with a distributor, can create acute financial pressures at one point in the process, to the discomfiture of a generator that does not have a distributor providing cross-subsidy. Hon. Members have already made the point that the cost from the generator has gone down, but the cost to the consumer has barely moved. That has been part of a process.
  The security of electricity supplies across Britain is an important duty for the Government. Now that the hon. Member for Ochil is in his place, I can say that I commended him for his defence of the Secretary of State, but she will have to take the blame for a failure of supply if she has not authorised the capacity to maintain supply. Ministers should bear that very much in mind.
  I welcome many aspects of the Bill, but it has some huge gaps and lacks realism. For example, do we have adequate energy reserves? France has reserves of some six to eight weeks. Over the years, we will see an increasing reliance on imports. By 2006, we will no longer be self-sufficient and will increasingly have to rely on energy sources from politically unstable countries, as my hon. Friend the Member for Eddisbury (Mr. O'Brien) said, and the UK is right at the end of the pipeline, at the point of maximum risk.
  Mr. Denis Murphy:The hon. Gentleman mentions energy reserves, but does he regret the part played by his Government in destroying Britain's mining industry?
  Mr. Page:I remind the hon. Gentleman that in 1997 the Labour party gave a commitment at the general election that it would provide support and money for clean coal technology, so that the mining industry could be developed and the mining product would not be so polluting. I am still waiting to see that happen. I do not know how many mines the hon. Gentleman has been down, but having done so myself I really think that if someone came forward today with a new energy source that meant that people had to be sent underground to dig it out, many would feel that it was not a suitable job for human beings on health and safety grounds.
  The Bill glaringly lacks a nuclear policy. In the future, our children's children will talk about us, saying, "Do you know that that generation actually burnt gas and oil for heating? How mad were they?" The feedstocks of those chemicals will be long gone. Some parts of the Bill are good and some are misconceived. The Government must look for further justification for policies than just "it seemed a good idea at the time."
  6.54 pm
  Mr. Michael Clapham:This is a large and important Bill, but it misses the point, in particular with reference to the coal industry. I see that part 1 refers to clean coal technology, but that is about the only reference to the coal industry. The hon. Member for Eddisbury (Mr. O'Brien) referred to a black hole, but it was created by the Conservatives when they were in power. In the aftermath of the miners' strike, between 1985 and 1992, they closed down 120 collieries and, from 1992 onwards, a further 30 collieries. At present, we have just 13 collieries left.
  The hon. Member for South-West Hertfordshire (Mr. Page) was one of the Ministers involved in the privatisation of the coal industry and he will know that at the time it was below its critical mass. The privatisation was destined for market failure because no banker would invest in a coal industry below its critical mass. The privatisation made the industry reliant on Government support and, had it not been for the support provided by this Government, what is left of the coal industry would long since have disappeared. However, it would be possible to invest in the 13 mines that remain and make them profitable. That is because of the changes in the world energy market.
  My hon. Friend the Minister will be aware that coal prices have started to increase because of the demand from China and from other Asian countries. For example, Malaysia has two new huge coal-fired power stations. The Malaysians have decided to diversify their energy economy away from gas, and consequently have invested in new clean coal technology. That has put pressure on prices and they have started to rise, to such an extent that the UK coal industry is approaching competitiveness.
  I hope that my hon. Friend, even at this eleventh hour, will reconsider some of the decisions that have been made about the Selby complex of four mines and about the Hatfield colliery. I know that my hon. Friend the Member for Doncaster, North (Mr. Hughes), if he catches your eye, Mr. Deputy Speaker, will concentrate his remarks on the situation at Hatfield, but I hope that

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  my hon. Friend the Minister will consider investment in those two colliery complexes. The Hatfield colliery leads into the country's largest reserves and if it is allowed to close, the industry will be on a slippery slope.
  Much has been made of the technology that has been used to tackle pollution. The power industry has fitted flue gas desulphurisation systems to address the nitrogen and sulphur emissions that cause acid rain, and that is working successfully. However, we need a real commitment to investment in new clean coal technologies. My hon. Friend the Minister would no doubt say that there is a multiplicity of new technologies, but we should consider investing in and encouraging the use of two major ones: first, supercritical boilers, a new technology that could be retrofitted to existing power stations, making them much more efficient. After all, it is the efficiency of a power station that counts in cutting down CO2 emissions. The second is the integrated gasification combined cycle system, and the owner of Hatfield colliery is prepared to invest in it. He has been able to put together a package for investment in that new clean coal technology, but unfortunately the colliery may close.
  At present, the generators are sweating their capacity to squeeze out the Nth degree of profit, and we must encourage them to reinvest in new technologies. The current resources that the Government are making available for investment in clean-coal technologies are insufficient. We need more investment in clean-coal technology. The greater that investment is, the stronger the signal that will go out to the remainder of the coal industry to enable it to continue in the future.
  Paddy Tipping: Before my hon. Friend leaves the powerful case that he is making for the coal industry—that coal can be economic, but environmental constraints cause problems—will he ask the Minister about the large combustion plant directive? If that is not implemented properly, it will kill the British coal industry.
  Mr. Clapham: I am grateful to my hon. Friend for prompting me about the large combustion plants directive, which indeed relates to the Bill. The directive will become operative from 2008, and currently two options have been put forward. One option is the national plan approach, and the second is the emissions limit value approach. The nationl plan approach can be visualised as a bubble over the whole country, while the emissions limit value approach would be a bubble over each power station.
  There are people in the industry who say that to adopt the national plan approach would close the British coal industry, because it would encourage generators to bring in low-sulphur coal from places such as South Africa, Australia and north America. If we adopt the ELV approach, generators will be encouraged to invest in their plant, which would be beneficial to the UK coal industry because UK coal could be burned in power stations. It is important that the Minister make the right decision. I understand that he is on the verge of making that decision, and that officials from his Department have inquired into the situation. Will he tell us whether he will adopt the ELV approach and avoid the national plan? That is very important.
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  I return to the Bill and its proposals to set up a nuclear decommissioning authority. That is important because, as my hon. Friend the Member for Ochil (Mr. O'Neill) made clear, it is necessary to have a co-ordinated, uniform approach that would be better for the industry and the safety of the country. I hope that the Minister will tell us whether the nuclear decommissioning authority will be responsible for all the liabilities. As he will be aware, there are three areas of liability in the nuclear industry: spent fuel, radioactive waste and the decommissioning of sites. Do I take it that the decommissioning authority will be responsible for the entire remit relating to waste left by the nuclear operation?
  It is important that the Minister should not abandon the UK coal industry at this point, as it requires only a modest amount of finance to survive. As I have already pointed out, it is approaching competitiveness. It would be a shame indeed if that industry were to disappear because of the lack of a small amount of finance. Coal's advantages are so great that the Minister should consider ring-fencing an element of the UK energy market. Coal is cheaper and more flexible than other sources, such as gas or nuclear. Some pundits have suggested that if we continue along our current route, we may well end up importing 75 per cent. of our energy needs by 2020. We need to avoid that situation.
  In conclusion, I believe that the Bill sets out the route to ensuring the energy future of the UK. I hope that the Minister will consider in Committee what might be done to make more resources available for clean-coal technology. That technology is not just a matter for the coal industry. It is important to manufacturing industry because it would allow us to produce the sort of wares that would enable us to transfer technology in order to tackle the CO2 issue in countries such as India and China. It is important that the Minister take the issue on board and make resources available for clean-coal technology.
  7.6 pm
  Mrs. Gillian ShephardI am extremely pleased to have the chance to contribute to the debate, and I particularly welcome clause 128, to which I shall address my remarks.
  The clause enables the Secretary of State to introduce a renewable transport fuel obligation that would require specified sections of the road transport fuel industry to demonstrate that a specified proportion of their aggregate fuel sales were "renewable transport fuels". Its wording is perhaps over-gentle. It is not as strong as we should expect, given the Government's self-imposed environmental commitments, not to mention current, rising fears about fuel supplies and their costs. Nevertheless, it is welcome.
  The Secretary of State was deeply cautious about the clause. When asked to expand on what she intends, she said she was "still looking at it". However, the Minister for Energy, E-Commerce and Postal Services may be cheerier in his concluding remarks —I hope that he will be.

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  Part 1 should encourage those such as me and all other hon. Members who support the development of a UK biofuels industry. Clause 1 places on the Secretary of State the

  "duty to ensure the integrity and security"

  of energy supplies, and clause 2 specifically mentions energy derived from biomass and biofuels. Subsection (3) requires the Government or Government agencies to

  "develop effectively sources of energy enabling the UK to avoid undue reliance on imports".

  The lack of cheering or optimistic news about the likelihood of imports will strike the Government during the passage of the Bill. So far, they do not seem to have a clear notion of the opportunities missed by the Bill.
  What contribution would the UK biofuels industry make to the aims set out in part 1— if the Government ever encouraged such an industry to develop? It would clearly contribute to security and sustainability. It would also contribute to the development of alternative markets for UK-produced crops, and its environmental contribution would be impressive. According to the Government's research from Sheffield Hallam university, the reduction in CO2 emissions from bioethanol would be up to 70 per cent. That should be important to the Government. They have signed up to several environmental targets such as the Kyoto protocol, and have adopted a national goal of a 20 per cent. reduction in carbon dioxide emissions from 1990 levels by 2010. Their energy White Paper, which I assume informs the thinking behind the Bill, states:
  "The UK should put itself on a path to a reduction in carbon dioxide emissions of some 60 per cent. from current levels by about 2050."
  For good measure, the energy White Paper adds that

  "fuels made from biomass represent an important potential route for achieving the goal of zero-carbon transport, creating new opportunities for agriculture in the UK, as well as globally."

  I hope that the Minister is aware of the support in the House and the other place for biofuels. The Government should be aware of the cross-party support—illustrated by all the early-day motions, debates, questions and, indeed, delegations—for further encouraging biofuels. They should also know that, outside Parliament, a developed biofuels industry is supported by the CBI, the British Chambers of Commerce, the Institute of Food Research, the university of East Anglia, British Sugar, Friends of the Earth, the National Farmers Union, the Country Land and Business Association and so on.
  I make those points to this DTI Minister because, although they have been made myriad times to his colleagues in the Treasury, DEFRA and other Departments, it is not clear that the Government have a sewn-up, cross-departmental attitude. There is every kind of incentive and support from inside and outside the House for the Government to give more encouragement to biofuels, but, so far, there has been little action. I hope that the Minister can dispel the unfortunate impression given by the Secretary of State that, even as a result of the Bill and the inclusion of clause 128, there will be more of the same—in other words, she is still looking at things.
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  The debate about the need for Government support for domestic biofuels production has been going on for some time, without it reaching a firm conclusion. Last September, the Environment, Food and Rural Affairs Committee published its report, in which it said:

  "Government bio-fuels policy still seems muddled and unfocussed. It has expressed support for bio-fuels but the mechanisms used to promote their use have had little effect so far.

  Quite so. Our biodiesel industry, although valiant, is tiny and, as has been said several times, uses used cooking oil as its raw material. No bioethanol is produced in this country for transport purposes. That is the reality, despite the aspirations and hopes.
  Things are, of course, very different in other nations. Spain has recently tripled its bioethanol production. France already produces 344,000 tonnes of biofuels a year, and Germany produces 130,000 tonnes. An immediate effect is that rape seed produced in the UK is exported by road and sea to Germany and France, where it is made into biodiesel, and it is then brought back to this country by road and sea. How sensible, environmentally or in any other way, is that?
  It would be churlish not to recognise that a little progress has been made. In the Budget, the Chancellor announced the introduction of the 20p duty rate derogation for biofuels in 2005, so that the industry would have some certainty to plan investment: but, of course, it would have helpful if enough fiscal or other encouragement had been given at the same time to make the industry want to invest—a point made by my hon. Friend the Member for South-West Hertfordshire (Mr. Page). The consultation exercise announced in the Budget by the Department for Transport has only just been launched—rather late, given that the findings have to be produced by July this year. However, one of the options to be commented on is the principle in clause 128: a renewable transport fuel obligation.
  I would welcome hearing more information from Ministers about whether clause 128 will move the UK further towards a biofuels policy, how they intend to proceed and what the timetable is. Hon. Members who share my enthusiasm for this cause—there are many—have, as I have already said, raised it with Ministers from the Treasury, DEFRA and the Department for Transport. Today, it is the turn of Ministers from the DTI. Will they be able to assure us that they mean business by including clause 128 in the Bill and that taking action on it will produce a secure, sustainable domestic source of fuel supply, provide a lifeline to the rural economy and fulfil the Government's environmental targets? We look forward to hearing from the Minister later this evening.
  7.14 pm
  Mr. Bob Blizzard: I have followed and participated in energy debates for some time now, and it is not hard to notice a pattern: many of those who speak promote their favourite energy source and oppose other sources. I will promote mine tonight, but I do not think it sensible for any hon. Member to put down the other energy source that he or she does not like, because the real challenge for any Government is, as has been said, to keep the lights on and, even with a strong commitment to energy saving, we might well need all the energy sources that we can find.

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  The Government's key priority, therefore, must be security of supply. The fact is that gas will be the mainstay of electricity generation for many years to come. We will rely heavily on gas—some say too heavily. Of course, we must first maximise the recovery of the gas that this country produces, but we will soon become a net importer of gas.
  Some of the fears are exaggerated. People are concerned about the politics of some of the countries from which we propose to buy gas but history shows that those countries need the revenue from gas as much as we need the gas. There are also concerns about terrorist attacks on pipelines. That is a risk, but there could easily be terrorist attacks on nuclear power stations or any other generator, and an attack on a nuclear power station might be worse than one on a gas pipeline. We clearly need to develop energy sources other than gas, not only to achieve a balance and to enhance the security of supply, but to achieve our targets and obligations on CO2 emissions. That is why the part of the Bill that will provide the framework for the development of renewables is so important.
  In preparing for the debate today, I considered what happened in the House of Lords, and I was perplexed by what I can only call the breathtaking attack on wind energy by the Conservative party in the other place. Baroness Miller, who led for the Conservatives, said that wind power

  "can provide only a minute fraction of our power needs. The environmental impact of the giant windmills, both on land and offshore, gives rise to no less controversy than do nuclear powers stations." —[Official Report, House of Lords, 11 December 2003; Vol. 655, c. 839.]

  Lord Monro said:

  "Wind power is inherently unreliable".

  He also said that

  "we do not seem to care about what we are doing to the beauty of our country by putting up these wind farms, which produce such a minimal amount of power."'—[Official Report, 11 December 2003; Vol. 655, c. 906.]

  He seemed to forget that the Bill is basically about offshore wind power. Lord Jenkin went further and likened wind farms to something from the old Soviet Union; but, of course, the real agenda of such people is to promote nuclear power, and we have seen that in the House today.
  Pete Wishart: Does the hon. Gentleman accept that when we signed up for the renewables targets, we in fact signed up to exclusively onshore wind targets? Does he believe that we need a mixture in those targets? We must have wave power and biomass production; otherwise we will continue to have wind farms in inappropriate locations.
  Mr. Blizzard: I agree with much of what the hon. Gentleman says, and I shall deal with it as I proceed with my speech.
  The end result of all the vitriol in the House of Lords against wind power was that some almost wrecking amendments were aimed at offshore wind farms. Those amendments impose extreme restrictions and a one-sided view of the balance between offshore wind farm sites and navigation. There was also pressure to impose more onerous and demanding decommissioning plans
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  on wind developments than on nuclear, gas or coal generators. Nuclear energy seems to have become the Conservative party's obsession. It seems to want to charge headlong into a new generation of nuclear power stations now, just as they promoted and misrepresented nuclear power before. That is one reason why part 1 is necessary to clean up and put right that which was not properly thought through in the past.
  The energy White Paper is right. The Government are right to keep nuclear power on hold and right to leave the possibility open, but they are also right not to charge headlong into more nuclear power generation. The Government have created a five to 10-year window of opportunity for renewables, especially now that the renewables obligation has been extended to 2015. If the nuclear option were taken now, it would stifle or even stop investment in renewables— most notably, wind energy.
  The Conservatives seem to want wind energy to be a birth-strangled babe. In fact, I wonder whether their purpose is to try to create uncertainty among those looking to invest in wind energy so that, if the Tories looked like winning the election, the uncertainty would increase and the investment would not be made. There would be no future at all for wind energy under the Conservatives.
  Mr. Page: I gave the rounds on the non-fossil fuel obligation my maximum support, and what the hon. Gentleman says is completely wrong. Our objection is to the unrealistic targets set by the Government and not to wind energy per se. We do not think that it will reach the target of 10 per cent. and there will be a gaping hole in our energy supply. That is our problem.
  Mr. Deputy Speaker: Order. Before the hon. Member for Waveney (Mr. Blizzard) responds to that intervention, I should point out that we seem to be having a little trouble with the clock. It is adding double the extra time for each intervention. I do not want to be too hard on the hon. Gentleman, but it would be helpful if he could curtail his speech when one minute is showing.
  Mr. Blizzard: I am glad that you, Mr. Deputy Speaker, have offered guidance so I know how much time I have left.
  I can half understand the point made by the hon. Member for South-West Hertfordshire (Mr. Page), but I do not understand why it is necessary to be as anti-wind power as was suggested in the other place and by some of the comments made here tonight. I was talking about the creation of uncertainty in investing in wind energy, lest it were thought that the Conservatives might win the election. Thankfully, people are still investing in wind power.
  The case for wind energy is strong and irresistible. The wind is there, the technology is proven and it would be irresponsible and bad husbandry of natural resources not to harness the wind, especially when we face the challenge of global warming. After all, we are the windiest country in Europe, and not to maximise the use of the wind would be incredible.

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  Another Member of the other place, Lord Gray, with whom I get on very well, observed:

  "This year… There has been low rainfall, much sun, little wind."—[Official Report, House of Lords, 11 December 2003; Vol. 655, c. 863.]

  We often accuse politicians of being London-centred, but I invite people to Lowestoft where they will find plenty of wind at Britain's most easterly point.
  What has held back wind energy most of all is the uphill struggle that it has had in securing onshore sites in the face of a planning system combined with the great British "nimby". Perhaps we should see that as an advantage and as a chance to take the lead in offshore wind energy. We are already set to make more use of offshore wind than most other countries, and the Bill will enable us to go further. We have experience of, and expertise in, offshore installation work from our oil and gas industry and leading institutions, such as the Centre for Environment, Fisheries and Aquaculture Science, which is an executive agency of DEFRA and a world leader in the environmental assessment, monitoring and research that is needed to develop offshore wind.
  Intermittency does not make wind energy unfeasible. The implications of operating a network with 20 per cent. wind energy have been examined. There are extra balancing costs, but they are not prohibitive. Added to that is the possibility of using demand-side management more actively and employing better wind prediction. Both can help to mitigate the impact of intermittency. Some of us visited Schleswig-Holstein a couple of years ago, where 40 per cent. of the electricity is generated from wind. Yes, there is an extra cost to wind energy, but the cost of not making use of it in the face of global warming could be greater.
  Mr. Laurence Robertson: Will the hon. Gentleman give way?
  Mr. Blizzard: No, because, unfortunately, I do not think that any more time would be added on.
  Offshore wind is popular even among those who dislike onshore wind. There are signs in my area saying, "Offshore not onshore". We should harness offshore wind's popularity.
  The great news is that offshore wind energy is happening. Right now, turbine columns and blades are sitting in Lowestoft harbour and they are being assembled and taken out to the Scroby Sands wind farm development. In fact, most of the turbines have already been erected, and this is only the start of a new industry in my part of the country. I am pleased that Lowestoft can claim to be at Britain's leading edge when it comes to offshore wind and offshore energy experience, as a brand new brochure makes clear.
  The geographical position of Lowestoft is ideal. It is Britain's most easterly point and is a port surrounded by areas from the Wash to the Thames estuary designated for wind farm development. That is good for a town that has long suffered economic disadvantage from its location. We have expertise from the offshore sector, from firms such as SLP Engineering, and we are also the national headquarters of CEFAS. In short, offshore wind is my
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  constituency's great hope for the future. The Bill will pave the way for further offshore renewable energy by establishing the comprehensive legal framework.
  My constituents will be amazed by the Conservatives' opposition to wind farm energy that we heard in the House of Lords and tonight but, as has been said, offshore renewables are not just about wind. They are also about the excellent resource that we have in the tidal current. Tidal current is reliable and predictable, and the CEFAS institution in my constituency that is working on it tells me that we are on course to have a commercial demonstration project within five years. That would be another opportunity for this country to lead in the world. However, the Norwegians are working on it, too.
  We have to pursue all those options, but they alone will not be enough to secure the low-carbon future described in the energy White Paper. There may well be a need for nuclear, but we should consider other options as well. One such other option is the near-zero emission option of carbon capture and storage and enhanced oil recovery, which capture the CO2 emitted from power stations and bury it in depleted oil reservoirs and aquifers deep below the floor of the North sea. Because of long lead-in timer, if we are going to take that option forward, we must take it now. I am told that the Government have allocated £2 million for CCS and £4 million for nuclear fission. I think that the figures should at least be equal.
  I welcome the Bill. We must follow through on wind energy and we need to decommission and clean up the nuclear sites. Although gas will continue to be the mainstay of our electricity generation—we must maximise recovery our gas reserves—and although we must make much more use of the crops that can be converted into biofuels, we must pursue all ways of reducing emissions, including tidal current and CCS as well as offshore wind.
  7.27 pm
  Mr. Michael Weir: We in the Scottish National party and Plaid CyMru find the Bill to be very much a curate's egg. There are elements in it that we are keen to support, b it there are others that we have concerns about and that we shall wish to consider at later stages.
  The Bill is very important for Scotland because, despite what has been said about the future of electricity generation in the United Kingdom as a whole, we are a net exporter of electricity. We generate on average 26 per cent more electricity than we need at peak capacity. We have a clear diversity of supply with ample natural resources, but we also have nuclear power.
  The establishment of the nuclear decommissioning authority is welcome in principle, but we have concerns over the particulars of the arrangements. Overriding these concerns is the fact that the Bill contains no statement on the agency's environmental principles. We believe strongly that environmental principles should be at the heart of the agency's operations, but we note that clause 12(2) states that the NDA must adhere to certain principles, including promoting competition and securing value for money. However, the clause states that the agency must only have regard to

  "the need to safeguard tie environment".

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  That provision is not strong enough.
  It seems to us that money and competition will be at the heart of the agency, while environmental concerns will be a mere add-on. That seems to be the wrong way round. A set of environmental principles should be enshrined in the Bill. Indeed, the protection of the environment and the health and safety of the population should be the Bill's central plank as it undertakes the clean-up of our nuclear sites, many of which, I remind the House, have a less than glorious record on safety and, indeed, on keeping records as to exactly what nuclear waste is stored where.
  We are also concerned about how the Bill relates to Scotland. It merely says that the Secretary of State will be required to consult Scottish Ministers. Perhaps the Minister will elaborate on the Executive's powers. What will they be able to do if there is an attempt to establish a new nuclear waste site within Scotland? Would that be part of the agency's work or would it be covered by previous legislation?
  We also have concerns about whether the Bill would have the effect of allowing new nuclear build. The wording of the provisions relating to the Government's obligation to pick up the bill for British Energy's liabilities may allow for future private nuclear companies to be bailed out for their waste and decommissioning liabilities. That could provide an incentive for new nuclear build, something that is completely off the agenda at the moment because of the huge costs and risks to any commercial developer.
  In an intervention on the Secretary of State, I asked specifically about the thinking behind clause 82. The explanatory notes refer to

  "circumstances where British Energy has sold one of its nuclear power stations to a third party, the acquisition of the power station from that third party and subsequently operating it."

  In other words, the Bill gives the Government the power to use taxpayers' money to buy and operate nuclear power stations from a third party. There is little difference between that and nationalising a nuclear power station. It seems to fly in the face of the Government's steadfast refusal to countenance clause 1, inserted in another place.
  The point is important because there is a danger, as has been mentioned, that the UK faces an energy gap if we do not do more to ensure that alternative energy resources work and provide the claimed amount of electricity. We are opposed to nuclear power, but we must be aware that the UK Government have a target—perhaps I should call it an aspiration—of producing 20 per cent. from renewables by 2020. The Scottish Executive have a target of 40 percent. There will have to be a much more serious plan to invest in renewable resources, and the serious investment to go with it, if we are to have a chance of meeting those targets.
  We have to be completely honest and recognise that much of the argument about renewables is theoretical. What is not entirely clear is whether such systems can produce enough energy and whether it is economically viable. It seems to us that those questions can be answered only when we are in a position to test much larger systems and when many of them are on line. That will happen only if there is a considerable increase in investment in such energy.
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  Scotland's supplies of gas and oil give it an immense advantage and opportunity that we can utilise while building up renewables, although it might also mean—I have to be honest about this—backsliding on the Kyoto agreement until renewables are on line. Scotland has a huge opportunity to be at the forefront of the expansion of renewable energy. In a report for the Scottish Executive—"Scottish Renewable Resource 2001"—Gerry Hassan said that Scotland has 25 per cent. of Europe's potential for renewable energy, and the potential capacity to produce 75 per cent. of the UK's electricity needs from renewable resources. That is a tremendous opportunity, but only if the investment is in place.
  It has been explained that almost all energy from wind and wave is generated from onshore wind farms. It is quite clear, as has also been mentioned, that those methods are met by a great deal of opposition from the general public. It is clearly not realistic to propose that all wind farms be allowed planning permission irrespective of local conditions, size and positioning. It is also quite clear that onshore wind alone has no chance of meeting renewable targets.
  There is an enormous potential for other forms of renewable energy in Scotland. Hydro is one example. When it was first introduced in Scotland after the second world war, it was said that it would be too cheap to metre. That never came to pass, and we should not make ridiculous claims for any form of energy. To put that into perspective, although offshore wind farms are being built—we have heard about one or two of them—Scotland has only one wave-generation plant, which is a small-scale project on the island of Islay. The year 2020 is not that far away, and if we are serious about renewables we must be prepared to invest not only in the plant itself, but in the grid required to transmit the energy. Much of the potential for wind and wave power is in relatively remote areas where the national grid does not run or does not run at a sufficient strength. I suspect that our target can be achieved only by public investment. We should not shy away from that. Public investment built the grid in the first place, and massive amounts have gone into nuclear energy.
  The Bill establishes a framework for offshore wind farms, which is welcome, but costs will become a serious issue. I draw hon. Members' attention to an article in this week'sScotland on Sunday under the headline "Green will Make us see Red when power bills soar". The cost of energy from renewables will become a serious problem. We must ensure that we address that problem and the costs that have arisen from nuclear energy. We must be clear that there is a huge environmental cost if we do not go down the renewable route, although in the short term there may well be an increase in costs to the consumer.
  The last part of the Bill deals with BETTA. We have also heard much about the new electricity trading arrangements. The Public Accounts Committee said that residential customers have not seen much benefit from NETA, and there is much fuel poverty in Scotland and elsewhere in the UK. That will have to be addressed before we can go down that route completely. There are concerns about the postage-stamp principle for consumers in remote areas, such as the highlands and islands, because of the cost of transmitting electricity there. Clause 180 partly addresses that concern, but only

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  for a short time. The problem could become huge in rural areas throughout the UK if BETTA goes ahead. We must consider that matter in Committee to ensure that rural consumers are protected. There are also concerns about access to the grid from generators. and the costs involved. Those, too, can be pursued in Committee.
  7.37 pm
  Mrs. Gwyneth Dunwoody: Any energy Bill that concerns the House of Commons is obviously a matter of great urgency, but it is clear from the breadth of the debate that there are concerns within the UK about our energy policy. Will we have security of supply? How can we address the problems of renewables? Are we concerning ourselves enough with the amount of research that needs to go into new technology? We have heard about the possibilities of renewing the coal industry. We know about renewables from biomass. We also know that there are many things that the Government can do to secure the future of the electricity supply. However, I want to draw hon. Members' attention to a much narrower, but to me a rather more important, point. I hope that I am forgiven if I get straight down to the practicalities.
  The Bill contains provisions for wind farms offshore. That is not a new subject and has been considered ever since the Harold Wilson Government when Professor Zuckerman did an enormous amount of interesting and important research. The Secretary of State told us that there had been many hours—75, I think—of debate in another place. However, throughout that time there was no acknowledgement of one simple fact: if we build very large turbines and give permission for the development of very large turbines throughout a large site of a number of nautical miles—in one case, in the second round, a site as large as the city of Nottingham—we are creating an instrument of some importance. I was therefore astonished first, that the Department for Transport was not involved in the steering group that produced the policy, and secondly, that when the steering group was set up, it was some time before the Maritime and Coastguard Agency was consulted, and many other important sectors of the shipping industry were not even allowed to contribute to the development of the plans.
  The Transport Committee was so concerned that it looked urgently at that matter. We discovered that a number of practical problems presented themselves immediately. It is clear from the maps for the first round of wind development that the areas are quite small and are nearly all within the 12-mile limit. The second round is nothing of the kind: it is permission for the wind industry to move in on very large sites. Interestingly, the Department of Trade and Industry appears to be reproducing mistakes made by the Department for Transport. When the Strategic Rail Authority simply said to people in the rail industry, "This is the kind of area that you should be looking at", but did not make it clear which particular part, it caused considerable difficulty. The second round of bids for wind farms appears to be the same thing.
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  We said that we could not understand why the two most important bodies, the Department for Transport and the MCA, did not insist on being represented on the steering group. Our other concern was that

  "every one of the strategic areas is on the approach to a major port or ports."

  We were told that the London Array site on the Thames

  "blocks one of the three, access channels into the Thames. It goes right across the mouth of the Fisherman's Gat".

  One of the sites in Liverpool bay will disrupt the ferry service between Heysham and the Isle of Man, imposing delays of half an hour on each crossing and considerable extra fuel costs. The best point, however, was in the evidence from the National Union of Marine, Aviation and Shipping Transport Office—NUMAST—given by a master who had been at sea for over 30 years. He said that the proposed site in the Humber was

  "located at a very busy junction where there are three vessel traffic separation schemes converging for traffic entering or leaving the Humber along with coastal traffic making their routes north and south."

  Perhaps we could just take on board what that means: it is a convergence of routes. The Humber at Immingham, for example, is the place from which, every day, we export many thousands of cars on very large container ships. If anyone is unsure what I am talking about, let me make it quite clear: when one is standing on the quay, some of those container ships are 300 or 400 ft above one's head, so I am talking not about a small vessel but about one that could get into very real difficulty if wind and wave power such as exists already manages to slam it into a pylon. I may be unduly being a Cassandra, but it might be a matter of considerable concern if Christmas day were enlivened by a news broadcast announcing that at least one large container ship was wedged between two or three pylons in the North sea, yet as far as I can see the shipping industry was told, "Don't worry We will look at your problems but we are not necessarily going to take any notice of them."
  The problem goes further: the structures interfere with radar. They interfere not only with the RAF's aircraft systems but with ground-based systems used for security purposes, so there is a very real problem. We might not know who is approaching our shores in difficult situations. The structures also pose problems for vessels at sea, as they can distort their controls.
  Let us be clear what we are talking about. We need details in the Bill about the procedures to be followed in the event of a collision between a vessel and a wind farm. We must remember that some vessels are crewed by people whose qualifications and experience were not gained in the United Kingdom. The Committee believes that at some point a major problem such as a collision is inevitable, and we must have plans in place to deal with that.
  We think that it is important to consider the creation of safety zones around every one of these pylons and to have particular identification of sites that will not compromise the integrity of the consent process. We are astonished that the DTI is talking about all this in a very relaxed way, and we think that any installation that goes ahead must be shown not to compromise the safety of navigation. Why were Trinity House and the General Lighthouse Authorities not consulted much earlier?

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  Why have we heard the suggestion, even tonight, that opposition to the practical difficulties is based not on knowledge from the shipping industry but on some extraordinary hang-up about the development of alternative fuels?
  I want to see this country capable not only of securing its supplies for the future, but of securing them from such a wide selection that we are able to ensure that we never again have the situation that existed after the last war, when we frequently lost power. When one thinks of the number of developments in manufacturing and domestic affairs that have occurred, one sees how important that is. But the Department has to take this seriously: the Select Committee report is not an amusement; we did not write it to entertain ourselves. If we ignore these matters now, the results could be horrendous.
  7.46 pm
  Mr. Robert Key: I support the Second Reading of the Bill. We will no doubt go into the detail in Committee.
  What makes Britain unique in energy terms is the variety of sources available to us as a nation. We need to start a debate such as this with a discussion of the national energy objectives. We might put them in a different order. I think that the most important one is to meet UK energy demands safely and at optimum price. Close behind that is ensuring the security of supply, achieving our environmental objectives, relying on a balanced range of alternative sources and encouraging the efficient production and consumption of energy. All of us here have a responsibility in everything that we say to bear it in mind that we need energy efficiency both in generation and in transmission. We also need efficiency in industrial use and consumption. If we wish, we can all make a difference, by switching off unwanted lights and so on.
  I have often wondered why the Liberal Democrats simply cannot see what is obvious but following the speech of the hon. Member for Hazel Grove (Mr. Stunell) I now understand: it is only the Liberal Democrats who will put out the lights when they enter a dark room.
  We need to optimise the contribution of renewable energy sources—wind, wave and solar. That is a given. However, we also need to recognise their limitations. They can never provide the base load generation that an industrial nation such as ours requires. We need a new generation of nuclear fission plants, possibly leading to fusion, and I think that we could then move into the hydrogen economy, which, although it may not prove to be the holy grail, could certainly be real progress for our nation. Of course, no Government, and therefore no taxpayer, will build another nuclear plant. If such plants are built, they will all be regulated private sector investments.
  I particularly welcome chapter l of part 2, which introduces the nuclear liabilities fund and creates the nuclear decommissioning authority. That is extremely important. It is for me a great irony that, as I well recall, back in 1976 when I was a teacher of economics, the royal commission on environmental pollution produced a report saying that no nuclear power stations should be built without first dealing with long-term waste, but
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  within days the Labour Secretary of State for Energy, Mr. Tony Benn, ignoring that, went ahead anyway. It is appropriate that this Labour Government are implementing something that they should have done in 1976. Until now, no Government have addressed properly the issue of nuclear waste. We have failed to address the need for a new generation of nuclear plant. We will put that right.
  I was very heartened by the debate in the other place on 6 May when Lord Sainsbury said:

  "It is not easy to predict the best combination of those factors for the future. Therefore we have stated clearly that we will consider new nuclear build as one of the options for the future."

  He went on to say:

  "We cannot predict the future exactly, but the steps the Government are taking form a sensible response in order to reverse the situation we had when we came to power, which was one where the whole area of nuclear research had been closed down. We have been turning that right around so that if a decision on new nuclear build comes through, we shall be able to seize that opportunity."—[Official Report, House of Lords, 6 May 2004; Vol. 660, c. 1271.]

  That is probably the most optimistic thing that the Government have said about nuclear power for a long time. We should all remember that although nuclear waste remains a risk for hundreds of years and it seems inconceivable that radioactive half-lives can be engineered down to short time scales, the half-life of carbon dioxide in the atmosphere is also measured in hundreds of years and burning coal, oil and gas creates long-term wastes as well, so that to take the latter route is to bequeath to future generations a much hotter climate and less biodiversity.
  I strongly support clause 128 on the renewable transport fuel obligation. There will be enormous opportunities, not only for the environment and for our nation, but for the farmers in my constituency and throughout the United Kingdom, when oilseed rape can be used for biodiesel, wheat and sugar beet can be used for bioethanol mixed with petrol, and set-aside land can be used to grow fuel. I acknowledge that the Government have made the right noises so far, but bioethanol needs more than the 20p a litre fuel duty reduction—that is insufficient to encourage major investment in bioethanol production. What we need is a duty reduction of about 30p a litre, or equivalent support in the form of capital grants. I hope that the Government will not seek to delete clause 128, which was inserted during proceedings in the other place after being proposed by a Labour peer who happens to be a distinguished Wiltshire farmer.
  We should not neglect a further aspect of the Bill, which has not so far been mentioned: chapter 3 of part 2, which creates the civil nuclear constabulary. In 1986, I served on the Standing Committee that considered the Ministry of Defence Police Bill. That Bill was but the start of the tinkering with Britain's police service. We in this country have always accepted that policing is by consent and that control lies with local police authorities, which have at least a democratic element to them. However, we have seen the emergence of a number of national police forces—four of them, with perhaps more to come—which are in the direct control of Secretaries of State, are answerable to the House of Commons only indirectly, and are not answerable to local people. They are answerable only to various fairly disembodied boards.

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  There is one glaring and extraordinary omission from chapter 3, in that the UKAEA constabulary is to have its jurisdiction reduced from 25 km to 5 km, and its officers are allowed to go beyond that only in pursuit of stolen nuclear or nuclear-related goods. Furthermore, they are specifically disallowed from assisting the civil constabularies—the Home Office police—in an emergency. That is bizarre—so bizarre that it runs contrary to the Government's recent actions in giving additional powers to, for example, the British Transport police and the Ministry of Defence police, which they have integrated more closely with Home Office constabularies, to the great advantage and protection of communities throughout the country. I hope that we can address that problem; I shall certainly pursue it in Committee.
  The Bill seems also to reflect an assumption on the part of the Secretary of State for Trade and Industry that the officers of the UKAEA constabulary are not properly trained police officers. They are. All training for their officers is Centrex approved and all detectives, chief police officers and counter-terrorist search officers are Home Office trained. We should have complete confidence in them. The UKAEA police have full constabulary power, but that is to be limited and, indeed, reduced. That is absolute nonsense. I am grateful to Mr. Barry Wright, secretary of the Atomic Energy Police Federation, for drawing the matter to my attention. It needs to be pursued in Committee.
  I shall end my remarks at that point. A great deal of work needs to be done, and I am grateful to have had the opportunity to set out my modest agenda at this stage.
  7.54 pm
  Mr. Kevin Hughes: When the Secretary of State opened the debate, she said that three themes run through the Bill. I think that there are four, and one of them is clearly that of missed opportunities. Everyone who has spoken after her has mentioned a missed opportunity. Energy is not really one of the other three main themes. We have to rely on part 1, which was inserted through amendments made in the other place, not only to provide a debate on energy in connection with this Energy Bill, but to set out clearly the important issue that we should be discussing: this country's energy requirements and security of supply. For what it is, the Bill is pretty good and worth supporting, but to call it the Energy Bill stretches the imagination a little too far. If it was on sale in a corner shop, someone would get done for misrepresentation or for offences under the Trade Descriptions Act 1968.
  None the less, part I deals with important issues, on which I shall focus this evening. Important though NETA, BETTA, the NDA and Ofgem are, I shall stick to security of supply and the country's energy requirements. The Bill does represent a huge missed opportunity. To be frank, it beggars belief that any Government are prepared to leave our energy requirements entirely to market forces. I do not understand how we can do that. The Secretary of State's cunning plan appears to be that we will import 80 per cent. of our energy requirements and generate 20 per cent. using renewables by 2020. Presumably, we will be importing all our gas, oil and coal, we will have no
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  nuclear energy, and all we will be left with in this country is a bunch of windmills that only work when the wind blows. The fact is that they work only about 30 per cent. of the time. I do not think that that is very efficient.
  My hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham) mentioned Hatfield colliery, which is in my constituency. Although I do not want to rehearse the arguments about why it closed, it is important to state that the colliery is closed. There are steel caps on the shafts. Some of us had hoped that the adjoining colliery at Thorne would form a super-pit with Hatfield to access the 100 million tonnes of UK coal that is there, but I learned today that plans have been started to fill in the shafts at Thorne. It seems that there is no longer a possibility of running the Hatfield and Thorne collieries together, which is a crying shame, because the opportunity available at Hatfield colliery was second to none. Many people write off the coal industry, but the new technology that my hon. Friend discussed—the integrated gasification combined cycle system—offers the opportunity to reinvent the coal industry, to use one of our greatest natural resources, and to generate electricity in abundance without the toxic emissions that we normally associate with burning coal. The IGCC technology does not burn coal in the traditional sense, and it is possible to capture CO2 emissions during the process. In fact, we can pump the CO2 down into our oil wells in the North sea and enhance the recovery of our oil wealth there.
  I know, because it has been investigated, that were we able to keep Hatfield colliery open, a planning application under section 36 has been agreed. An IGCC power station at Hatfield would make it possible to pipe that CO2 up to the Scottish oilfields and enhance the recovery of the oil, so it has a dual function. But it is better than that—nitrates can also be captured during the process, which as we all know are used in the chemical industry. It gets even better—most of us understand that the way forward for energy is probably hydrogen power, and the IGCC process can also capture hydrogen.
  Under the plans for Hatfield, which are there for anyone to see, to capture the hydrogen and produce the energy cells, enough hydrogen would be captured at that single plant to run the whole public transport system in south Yorkshire. That is a pretty huge amount. Unfortunately, that opportunity has been missed, because the Government are worshipping market forces. They believe that we can leave everything in the energy industry to market forces. I am sorry, but we cannot. The Government need to pump-prime some of that new technology. Allowing Hatfield to go under, as it has done, was a tragedy.
  This Government put a lot of money into trying to secure the future of Hatfield, and my hon. Friend the Minister spent a lot of time with me trying to do so. Because it is left to market forces, and because of the problem to which my hon. Friend the Member for Barnsley, West and Penistone referred of accessing funds from banking for private industries, the bottom line is that it is difficult to access the type of capital required for that kind of project. Private industries would be expected to raise £30 million to £45 million to access the 100 million tonnes of coal available at Hatfield. Given what the Government published in the White Paper, and the looming large combustion plant

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  directive, people in the City are hardly filled with enthusiasm for lending £30 million to £45 million to somebody who wants to exploit the coal reserves at Hatfield. Consequently, at present those plans are on ice. I am still hopeful that the present owner, Richard Budge, who is well known in the coal industry, will keep trying to access funding to open Hatfield colliery again, and to get the IGCC technology up and running.
  The Government cannot sit on the sidelines wringing their hands. Our energy needs are at stake, and they need to get involved. Sometimes, that means putting in some money, pump-priming this technology and capital investment. I urge them to do that, because it is not yet too late. Certainly, it is not too late for the project at Hatfield.
  8.4 pm
  Mr. Michael Jack: We have heard many interesting views, but I want to pick up on some comments made by the hon. Member for Doncaster, North (Mr. Hughes), because he and I share one part of a common agenda: security of supply of energy in this country is vital. I also want to pick up on an observation by the hon. Member for Sherwood (Paddy Tipping). In a telling intervention, he effectively agreed with a line that I have taken in previous debates: effectively, we cannot have a cheap energy policy in this country and, at the same time, energy security.
  Other right hon. and hon. Members who have spoken have rightly said that this might be a debate for enthusiasts, each of whom promulgate their chosen source of energy, to which they or their constituency are committed. For my part, I remember as a boy, in 1956, reading in my "Eagle" comic about the arrival of Windscale nuclear power station, and a wonderful cutaway drawing promising limitless forms of energy in the future. That had an influence on me, and when I became the Member of Parliament for Fylde, and discovered that nearly all Britain's nuclear fuel was made in my constituency, I thought that the world has an unusual way of coming full circle.
  There is another way in which we need to tackle arguments about energy security. Most of our remarks in this debate have been about security in the physical sense: about what happens if one system goes wrong, and whether others have enough capacity to replace the missing energy. I also want us to develop a policy of security in the economic sense.
  One of my worries about the policy partly espoused in this Bill is that we are still wedded to a hydrocarbon economy. We may get the gas through a pipeline from wherever—it may be delivered by sea—but soon we will find that at least 70 per cent. of our electricity is coming down somebody's pipeline, and the cost of that will be determined by the world energy market. By definition, therefore, with the removal of coal, the rundown of nuclear, and the questions raised by others in this debate about how much electricity can come from renewable sources, we have surrendered the amount of the energy price over which we have any real influence to the world energy market, which is volatile, as we have seen in recent events.
  I therefore draw a simple conclusion: whatever the outcome of the Bill, it must be about having the balanced energy portfolio that has served this country
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  extremely well. I want to associate myself with the remarks made by the right hon. Member for Copeland (Dr. Cunningham), the hon. Member for Ochil (Mr. O'Neill) and the right hon. Member for Airdrie and Shotts (Mrs. Liddell), who encapsulated in their own way many of my views about the future of the nuclear industry. The workers in my constituency have a remarkable safety record in the manufacture of nuclear fuels, and with the new investment in the fuels plant at BNFL at Springfield, effectively, no human gets near the manufacturing process. It is safe to make, safe to operate, and it has tremendous potential. Unless decisions are made, however, about the shape and scope of the future of Britain's nuclear industry, the fuels side of the business will not effectively be able to prepare itself.
  What is the future of that fuels business? I hope that the Minister will be able to say something about that. My hon. Friend the Member for Salisbury (Mr. Key) commented on remarks of a positive nature in the other place, but I want the Minister to tell us a bit more about the future of BNFL's fuels division, which, under the new landscape of BNFL, is part of the Westinghouse division. Between 1,200 and 1,500 jobs in my constituency are still involved in the manufacturing of nuclear fuel, and those workers want a much clearer view of the future of the industry.
  The Bill deals with the establishment of the new decommissioning authority, but there is a yawning omission. The Minister is right to establish a body to put into safer terms what is effectively a large nuclear dustbin at Sellafield—all the bits left over from the military programmes, which are dumped in those silos—and anyone who has visited it leaves thinking that something must be done with it. Having said that, the missing element relates to what the Government will do to speed up the process of consulting about what will be Britain's long-term nuclear repository. Without that solution, the new agency's work will be stifled before it begins. It has its bureaucracy in place, it works out how it will do its job; then where does it put the fruits of its labour? At present, the Government are still consulting on how to consult on the ultimate disposal of nuclear waste in this country. Finland, meanwhile, is just getting on with it.
  Rather than trying to find a solution for ever and a day, will the Government not at last adopt the Nirex approach? That means saying, "If we can get something safe and recoverable, it will do for a century." New technologies come along, but at least we have an answer to the age-old question of what we should do with the leftovers of Britain's nuclear industry, while giving hope to a new nuclear power generation industry that affordable disposal of its waste materials—albeit in smaller quantities, given the new designs of nuclear reactors—can be accommodated.
  My Select Committee also dealt with the question of biofuels. like others who have spoken, I welcome clause 128. As I said in an earlier intervention, its objective mirrors views that I expressed during debates on the Finance Bill and in the Select Committee's report. I believe that a target that blends with both the diesel and the petrol ends of the road fuels business gives the Government an opportunity to replicate mechanisms that they have approved in the context of the renewables

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  obligation. It is vital that they take that route, at least in terms of giving some decent pump-priming economic assistance to the industry.
  I realise that the 2 per cent. and 5.75 per cent. road fuels directive is indicative rather than mandatory, but if we are to meet its requirements we shall have to have bioethanol in this country. We talk a lot about biodiesel and the use of waste fats. Helpful as that may be, we cannot achieve our objectives with petrol-driven vehicles without bioethanol.
  As the Minister knows, there are other benefits. Apart from the use of output from the 300,000 tonnes of set-aside land, there is a potential benefit in the disposal of rubbish in this country. The lignocellosic part of the use of biofuels gives the Minister access to a waste-stream source consisting of wood, old materials and anything that produce sugar. Once the sugar is there, the fermentation that produces bioethanol can take place.
  British Sugar has made it clear that if that industrial process does not start now, it will invest in Poland and we shall end up importing the bioethanol that we need to meet our target. At present, the Department is playing a leading role in World Trade Organisation talks that will ultimately lead to the reform of the European Union sugar market. It has been too long unreformed, but something must be done with the investment that will provide the feedstock for bioethanol. In parallel, something must be done about biodiesel. We must kick-start a UK industry that uses UK-grown oilseed rape. At present, bizarrely, we are exporting raw material feedstock to Germany and France so that they can make biodiesel when we should be doing it ourselves.
  I hope that the Government will now take a lead and sort out the mess that is our biofuels industry. We have DEFRA saying how good it is for jobs in the rural economy, we have the Treasury setting the fiscal regime, we have the DTI presenting an energy policy—we even have the Department of Transport running a consultation exercise on the level of the biofuels obligation. Please can the Government get their act together, help the rural economy, and help themselves meet the carbon dioxide reduction targets by means of a UK-based biofuels processing industry?
  8.14 pm
  Dr. Brian Iddon: It is a great pleasure to take part in an energy debate in the main Chamber. Since my election, most energy debates have taken place either in Westminster Hall or here on Fridays, via the mechanism of private Members' Bills. It is rather sad that most of the advances —albeit small— in energy policy have been made in that way.
  Most developed countries are engaging in a serious debate about energy—rightly, in my view. The Science and Technology Committee visited Japan during its study of non-carbon fuels. One of the memories with which I left Japan was of a very mountainous country. From Mount Fuji the land goes straight down to the sea: there is no continental shelf surrounding the islands. That rules out offshore wind, because there is nothing to which to anchor the turbines. Tidal power is ruled out as well.
  The Japanese have obviously thought carefully about their energy policy. They have their old enemy, China, facing them, and they are conscious of the implications
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  of bringing in oil and liquefied gas via the sea. They have decided to invest heavily in nuclear power as their main base load, but also to invest heavily in photovoltaic cells. We saw roofs being lowered on to houses—roofs that had been preconstructed in factories, manufactured entirely from photovoltaic cells. Inside the houses were other energy-saving devices. The Japanese have thought through their domestic energy policy, and are also investing a great deal in fuel cell technology. I would say that in those two technologies theirs is the leading country in the world: it is probably ahead of us and even America.
  A large amount of public subsidy is going into photovoltaic technology. Photovoltaic energy is not yet able to beat all other energy processes, so the Japanese Government are subsidising householders to fit photovoltaic cells in existing properties, while all new properties are being provided with photovoltaic roofs.
  Finland has also been having a serious debate about energy policy recently. It has been upfront with its public about the possibility of building more nuclear plants and providing its base load through nuclear energy. In fact, that it is what it has decided to do. Its public debates have been far more successful than ours on, for instance, genetically modified crops. It has persuaded the people that the only way to secure its energy supplies for the future and to develop as it intends to, is to build nuclear plants. It is also solving—with the help of the public—the problem of disposing of existing nuclear waste from nuclear generating plants, which is a problem that faces us as well.
  Within three years we will be a net importer of gas, and within seven we will be a net importer of oil. As others have pointed out, by 2020 we will be at least 70 per cent. dependent on imported energy. Indeed, it has been suggested that our dependency will be as high as 90 per cent. I cannot, on behalf of my constituents, endorse a policy that allows us to rely on so much imported energy. If I were to design an energy policy—and I suggest that the Government act along these lines—it would involve two important concepts, security of supply and diversity of supply. The thought of gas coming from in anywhere in the world, even Norway—especially if it came through an above-ground pipeline—terrifies me. I think that "terrifies" is the right word, because, as we have seen in the middle east, it is easy to blow up such pipelines, not just at one point but at several points.
  Let us imagine what could happen if we were 70 to 90 per cent. reliant on imported energy, mainly gas, and there were one or two explosions on the pipeline. They might happen in the Russian states, from which we will probably import, or in the middle east, from which we may import. For how many days would some of our major cities and towns be without energy? No Government can afford to develop a policy that allows us to depend so much on imported energy.
  I am all in favour of renewable energy. We should be developing all forms of such energy, including the stuff that comes out of fish and chip shops. I was rather worried to hear the hon. Member for Eddisbury (Mr. O'Brien) say that the exhaust coming out of those cars smelled like almonds. Any chemist will tell him that the smell of almonds is like that of cyanide, so there is a bit

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  of a worry there. I am not suggesting that hydrogen cyanide was coming out of the exhaust, but it may have been.
  We must consider the base load. There is no way we can have an intermittent supply of energy—wind energy, for example—to produce the base load. We must have something that we can instantly switch on and off. Gas is the best form of energy in that respect, so we cannot rule out the use of gas. In recent years, there has been a dash for gas because it is cheaper and faster to build the plants. The returns for the investment are much greater for companies. There must be public investment in energy. I am all in favour of building new, cleaner nuclear plants that produce only 10 per cent. of the nuclear waste that existing plants produce.
  There is no such thing as a safe method of producing energy. Think about the Piper Alpha disaster in the North sea, the thousands, probably world wide hundreds of thousands, of miners who have been killed in methane gas explosions or other accidents. Energy comes at a cost.
  The nuclear industry in this country has a fine safety record. Okay, there have been problems in the Irish sea, but the very small trace amounts of radioactive material that get into the Irish sea do not bear any comparison with what used to happen. We have made great steps forward.
  I used to work in a department of chemistry that trained a lot of people for the nuclear industry. We had one of the largest radioactive suites in Europe, where we trained people to handle highly radioactive materials. Therefore there were departments who trained such people. Our courses were mainly degrees in chemistry or applied chemistry but they always had a module to train people for the nuclear power industry. The hon. Member for Eddisbury said that there are no undergraduate courses in that anymore. That is probably true, but there are modules on that in undergraduate courses. He failed to mention that there are still postgraduate university courses to train people in nuclear power. However, there are by no means enough. The nuclear power industry says that it does not have enough young people coming in to replace the people who are retiring.
  Energy costs are rising. The cost of the Phoenix gas company's supplies of gas in Belfast and the surrounding area has gone up by 11 per cent. in the past 12 months. A 20 per cent. increase in October is on the cards and is causing controversy in discussions across Belfast.
  If we have a 10 per cent. rise in gas or electricity prices, it puts 500,000 people back into fuel poverty. My right hon. Friend the Secretary of State said that 750,000 people have been lifted out of fuel poverty. Rises in energy costs, which are inevitable, will put a lot of people back into fuel poverty if we do not counteract that in some way. I do not think that there is any way of avoiding rising costs.
  Driving down costs of energy has had a downside: there has not been enough investment in research and development throughout the energy industry. It is therefore not all good news when the costs of gas, electricity or any other form of energy are driven down—the downside is a drastic reduction in research and development. We will feel that in future.
  8.24 pm
  Mr. Nigel Evans: I am grateful to be able to participate in the debate and to follow the hon. Member for Bolton, South-East (Dr. Iddon), who spoke a lot of common sense, particularly when he referred to the fact that if we rely on imports of energy, anything could happen, particularly in the light of the rise of terrorism. It would be completely stupid for any Government to have a policy that was based on that.
  This is an important debate because 100 per cent. of the Lancashire Conservatives have spoken in it. Sadly, there are only two of us at the moment but, following the next general election, no doubt there will be more and we will not be able to get 100 per cent. of the Lancashire Conservatives speaking in a debate of this importance.
  I speak as an environmentalist. I represent Ribble Valley, which is a beautiful, glorious, very rural constituency. I hasten to add that, to my knowledge, I have one wind turbine in Ribble Valley, and I hope to keep it that way. A British Wind Energy Association map shows where all the 1,100 wind turbines are in the United Kingdom. The map looks pretty crowded now, and if we carry on as we are we will add another 5,000 to 10.000 wind turbines to it. It will be absolute lunacy if we go down that path, for reasons on which I hope to expand.
  The Bill talks about the security and integrity of energy being vital. The Secretary of State for Trade and Industry is responsible for that. It is an important role.
  The hon. Member for Doncaster, North (Mr. Hughes) said that the current policy seems to be a free-market one. If that were the case and it were left just to the free market, I suspect that we would not have a single wind turbine in this country. If it were not for the subsidies, it would not be worth putting them up. It is important to get that right. If it were not for the amount of money that British taxpayers are paying for the erection of wind turbines, we would not be going down that path.
  In 20 or 30 years' time, when some sanity comes into energy policy, and a father and mother are driving their family around and one of the children points at a wind turbine and asks, "What is that?" the parents will reply, "That is an example of the folly of the late 1990s and early 2000s, when the Government thought that it would be the answer to all our problems. They invented targets that they had to meet, and they thought that wind turbines were the answer." We all want the Government to meet targets that mean that we rely less on carbon energy, but, sadly, one will not have to drive far to see examples of such folly—they will be all over the place. They are all over Scotland, Wales and large swathes of the south-west and the midlands—there is one coming near you now if we carry on with that policy.
  I want to rely not on my prejudices—I declare my interest as president of the Country Guardians, which opposes industrial furniture in the countryside—but on those of some other people. James Lovelock, the founding historical and cultural leader of environmentalism for environmentalists around the world, said:

  "I was asked to open the windfarm at Delabole. At that time nobody was talking about a gigantic programme, getting 15 or 20 per cent of the country's energy from wind turbines. It was a kind of nice green gesture. I think, now that I know as much as I do, I wouldn't have touched it with a bargepole."

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  The second person is Sir Martin Holdgate, the now-retired chairman of the Renewable Energy Advisory Group, which in 1992 advised the Government to set out on an alternative energy path. He strongly favoured renewable technologies, he said, but in the right place and on the right scale. He was attracted to the idea of solar panels on roofs and said:

  "The trouble with wind farms is that they have a huge spatial footprint for a piddling little bit of electricity. You would need 800 turbines to replace the output of a coal-fired power station."

  I am not an expert, so I rely on those who know all about it. My third expert has an honorary degree from the university of Central Lancashire. He said:

  "My main thing against them is that they can only work, if you are very lucky, for 30 per cent. of the time. Going by the ones in Denmark it is about 17 per cent. of the time. So how are people going to be able to boil their kettles, or how are we going to power our hospitals the rest of the time? It means that we have got to keep our other stations running, spinning in reserve, inefficiently and pouring out carbon dioxide and sulphur dioxide and the like."

  That person was David Bellamy; no one could say anything against his environmental credentials, and he is someone with huge credence in the country.
  We know that the demand for power will rise tremendously over the next 10 to 20 years and we need a policy to deal with that.
  Brian White: The hon. Gentleman implies that the only renewable technology is wind power. Does he recognise that there is a panoply of renewable technology and that we ought to make sure that that wide range of renewables is encouraged?
  Mr. Evans: I absolutely agree. Part of the problem is that we are reliant on one kind of energy but not on all the others mentioned in part 1 of the Bill. There are so many alternative energies that could be getting part of the subsidy that disproportionately goes to wind power. A lot of other technologies and renewables do not get a look-in for all sorts of reasons, and I hope that that will be addressed in Committee.
  There is a one-sided debate, as we have heard this evening: everybody loves wind turbines, which provide free energy and look nice—one cannot say anything against them—but nuclear power is nasty and horrible. One has to decommission nuclear plants. A wind turbine can be decommissioned for £12.50, but nuclear power will cost billions to decommission. The arguments are one-sided and, for whatever reason, Governments of different persuasions have been slowly hooked on wind technology. It is now time we got off that hook.
  The subsidy going to wind technology is enormous—about £400 million. The myths need debunking. I do not have a wind turbine in my constituency and I will keep fighting against it, as will a number of other people. That is why I intervened on the hon. Member for Hazel Grove (Mr. Stunell) to say that the Liberal Democrats were in favour of wind technology generally but against
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  individual applications, which they know will lose them votes. People do not like wind turbines, which reduce the value of people's property.
  Dr. Alan Whitehead: Will the hon. Gentleman in talk about offshore as well as onshore wind? He states that he does not have a turbine in his constituency, but appears to forget that we are talking today about turbines that are far out to sea and not in his constituency.
  Mr. Evans: At one time, I thought that because people always said nice things about wind turbines I should not hit them too hard. I knew that they were completely inefficient, produced a piddling amount of energy and were noisy. I knew that people did not like huge farms in their area and that such farms were a scar and a blot on the countryside. I knew that they hit tourism.
  If we shove them out to sea, we can pander to those people who think they are being environmentally friendly. We can put them on rigs out in the sea; it is hugely expensive, but who cares? We must pander to the green lobby somehow, despite the fact that it would give a small percentage reduction in carbon emissions. But, as the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) said, there are a number of downsides to that scheme as well.
  If we are looking at efficient ways of producing energy, we should spend a small percentage of the amount that we are ploughing into wind technology on energy conservation. If so, we would not need the wind turbines in the first place. There is hardly a mention in the Bill of energy conservation, which is remarkable. We spend money on lagging roofs and insulating doors and windows, and Ribble Valley council accesses Government grants to ensure it is able to do that. But why do we not do more? Why do we not invest more money to ensure that more people get access to cheaper lights that use less energy? They are expensive now, but why do we not bring the price down for everybody? Everyone could then get energy conservation bulbs, which would help a little. We could be doing all sorts of things on the conservation front, such as roof insulation, doors and cladding, which we are currently not doing.
  Mr. Stunell: May I warn the hon. Gentleman that he is coming dangerously near to propounding Liberal Democrat policy? I remind him that we have just spent £243 million propping up British Energy—money that should have gone into energy efficiency.
  Mr. Evans: I am old enough arid wise enough to know that almost anything that I say comes close to propounding the Liberal Democrats' policy one way or another, because one of them will be saying it to some group of people. If only they had a coherent policy, at least we would know where they stood. They are in favour of and against certain things at the same time, which is part of the problem.
  On the need to ensure that we preserve the countryside, and the ways of doing that—perhaps the Minister could address this point when he winds up—tourism is one of our fastest growing industries, with thousands of jobs reliant on it, so to scar the countryside

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  with yet more wind turbines is a grave mistake. Even to push them out into the sea, at disproportionate cost, is a grave mistake. Let us look at all the alternative supplies mentioned in the Bill, and ensure that sufficient funds are going into research and technology at the university and industry stages, so that we can work out what to do.
  Let us not turn our backs on nuclear energy, either. As my right hon. Friend the Member for Fylde (Mr. Jack) said—I suspect that I, too, have about 100 constituents working at Springfields —France is reliant on nuclear energy, which produces well over 70 per cent. of its total. We are prepared to import that energy from France, but turn our backs on it here, as though it were not in our backyard. I must tell hon. Members that France is in our backyard. To import energy from there, at the same time as denying that source here, is completely disingenuous. We should get a grip on that issue.
  8.36 pm
  Dr. Desmond Turner: At least the Conservatives are even-handed—they say, "Not in anybody's backyard", whereas the Liberals stick to their own backyards.
  To be a little more serious about energy policy, our problem here tonight is that we are discussing a Bill that should be the launching pad for an energy policy that makes a serious contribution to the future survival of the world, in terms of climate change. All that it is, in fact, is a set of housekeeping measures, which does not do anything seriously to promote renewable energy. The White Paper gave us all hope when it identified and set in lights the 60 per cent. target for CO2 reduction as a prime policy driver. Since then, the threat of climate change has been reinforced and emphatically stated from many sources, including the Pentagon and the Government's chief scientist, all of which have made it clear that climate change is the most serious threat to the security of the planet.
  The problem with climate change is that we cannot start too soon to try to do something,about it. Even if we achieve the 60 per cent. target by 2050, of all the climate change scenarios even the most moderate is still quite extreme, by comparison with current circumstances, and anything else starts to move into the apocalyptic. Energy, therefore, takes centre stage. Virtually all the CO2 output is derived from energy use, so it follows that we should be concentrating on moving away from the habit of burning fossil fuels. That has to be the ultimate driver.
  Although this might not be the Secretary of State's fault, to have a Bill that starts out by imposing a duty on her to keep the lights on, which she already has, is laughable. Even George W. would understand that one. We need to do a little better than that, and CO2 reduction has to be the prime driver There is now probably general agreement on both sides of the House, and with everybody in the industry, that the present aspirations for renewable energy generation in this country will not be met—and, sadly, the Bill does nothing to correct that. We have to ask ourselves why. What is wrong?
  For me, wind turbines are definitely not the be-all and end-all of the renewable energy industry. New technologies coming on stream could be far more
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  potent, especially in the United Kingdom. How fast they are exploited is another question. As everybody probably knows by now, my favourite candidate is tidal power, closely followed by wave power. Between them, those two natural resources have the inherent capacity, if exploited, to supply twice as much electricity as this country now generates and consumes. That massive potential has to be worth exploiting.
  Not only can those sources generate that huge amount of electricity, but tidal power can supply base load as well, because tides are totally predictable, to the minute. We know exactly when they will flow and exactly how fast, and the times change around the country, so if we locate our generation sites strategically, we can have constant predictable baseline power, with no CO2 emissions and no serious environmental consequences. That must be a goal well worth pursuing.
  We have seen the advantages that Denmark and Germany have gained from wind power, for all its problems. Denmark is a world leader in producing wind turbines, which provides thousands of manufacturing jobs in a small country and is a very significant contributor to its economy. We have that opportunity with the marine technologies, if we can exploit them fast enough. There are fantastic export opportunities.
  We have worried about the industrialisation of the developing world. What if China, India or the whole Pacific rim were to industrialise by burning coal? They do not have to do that, because there are magnificent tidal opportunities in the Pacific rim. Anywhere there are islands, there are tidal power opportunities. We still just have the world lead in this technology, and we could have a fantastic export industry, creating 50,000 jobs—or perhaps 100,000, or more. If we do it right, the sky is the limit. We cannot afford to miss that. Why are we not doing it more quickly?
  The example of our near neighbours Germany and Denmark shows how determined Governments, without massive expenditure, can promote the introduction and deployment of a technology. We must do that too, yet the sad thing is that the Bill does nothing about it.
  I have here a report by the Select Committee on Science and Technology. I probably do not have time to talk about its recommendations in detail, but it supplies the policy that is lacking, and if its advice were followed the funding would be supplied, through a carbon tax and carbon tax credit system. CO2-producing technologies would be taxed, and renewable technologies would get a credit. That would solve the problem that technologies other than wind power, which is already there and is readily deployable off the shelf, have in attracting investment. The current system of ROCs—renewables obligation certificates—is too small and too uncertain to attract investment. But if we are to get a new technology into the marketplace, it needs support. By definition, it cannot possibly come in straight away at a commercial price, because the early machines do not have absolute design optimisation and economies of scale. That is why new technologies need guaranteed entry prices. Germany has achieved such things through its renewable energy legislation. Whether or not one likes wind power, we should note that Germany has deployed it several times faster than we have, or even plan to.

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  The report also clearly sets out grid companies' obligation to connect new generators to the grid—we will have to rewire Britain completely—and how that will be paid for. We could do this. For example, our Committee proposed a renewable energy authority. We are to have a nuclear decommissioning authority, which I totally support, but promoting renewable energy is at least as important to our future. We could derive enormous benefit from such a body taking over the functions currently exercised by the Department of Trade and Industry, the Carbon Trust and other bodies that, frankly, are not as effective as they might be, and from its producing as concentrated an effort in developing renewable energies as the UK produced in developing nuclear power after the second world war.
  There are possibilities out there, but the Bill does not reflect them. It is not too late to incorporate some of these principles.
  8.46 pm
  Norman Baker: The good news, if I may say so in a spirit of generosity, is that the Government's energy White Paper is almost coherent in setting out the way forward; the bad news is that the so-called Energy Bill does not implement the White Paper. This is becoming a serial fault of the Government. The Waste and Emissions Trading Bill, which should have produced an holistic view of how we deal with waste, was simply the "landfill directive implementation Bill". The Water Bill was a series of small, unconnected measures that failed to recognise the water framework directive, which was being implemented at the same time through regulation. As hon. Members have said, this Bill is not simply a missed opportunity, it is a worrying sign. There is a window of opportunity to get this issue right, but the Government are missing it.
  I agree with those hon. Members who said that security and diversity need to be key drivers in energy policy. Of course, a third driver is minimising environmental impact, yet the Bill contains virtually nothing on energy efficiency or energy conservation. Labour Members rightly talked about the impact of high energy charges on their constituents, and the way in which people have been taken out of fuel poverty. I admire the desire to get people out of such poverty, but the best way to deal with the problem is to conserve energy: to reduce the cost of energy by reducing the amount that people have to buy, through energy conservation and energy efficiency measures. That would help individual constituents and reduce the impact on the environment, yet we hear nothing about that idea in this Bill; nor did the Secretary of State say anything about it in her opening remarks. That is another missed opportunity.
  The Government also need to look at transmission losses. We have long transmission lines, and as a recent parliamentary question of mine demonstrated, we lose more of our energy between the point of generation and the point of consumption than other European countries do, probably as a result of the transformer arrangements. It is a big issue that the Government have not even begun to address.
  The second failing is in respect of renewables. I, too, believe that renewables should and will provide the bedrock of our energy generation requirements in the
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  years ahead. They will do so through diversity of supply, rather than through onshore wind power alone, as the hon. Member for Ribble Valley (Mr. Evans)—he has disappeared from the Chamber—would have us believe. As the hon. Member for Brighton, Kemptown (Dr. Turner) suggested. there are a number of alternatives, which are listed in the Bill. But the Bill does not set out how to promote them, other than to wish and hope for the best.
  The Government fail to intervene in the energy market in a meaningful way. The days when the Department of Trade and Industry would intervene before breakfast, lunch and dinner—when Michael Heseltine was Secretary of State—have long gone. It is now a matter for market forces, but the idea is taken to a ludicrous degree. Some of us had lunch today with the senior environment official in California, who told us that the land of the free is intervening to get its energy policy right and making sure there is pump priming for renewable technology and low-interest loans for private sector companies to make sure that technologies are developed. Targets are being set for photovoltaics on 50 per cent. of homes in California. What are our Government doing about that? I am tempted to say something unparliamentary, but the diplomatic way of putting it is "Not very much".
  Much more could be done, and we have a window of opportunity in which to get things right. There will undoubtedly be increasing uncertainty over fossil fuel supplies. We are seeing the run-down—rightly, in my view—of the nuclear industry. We must make sure that we start actively to fill the gap, and we must do it now. We can do that, first, by reducing energy demand, and then by having a big renewables programme. We are not seeing that happen.
  Of course, it suits some people very well to pretend that there is no renewable energy industry able to meet the gap and that we must therefore fall back on nuclear power. It suits some people so well that wind power and other renewable energies are being talked down so that people are encouraged not to invest in them. That is what is being said from the Conservative Benches, and there is a spectrum of views—to put it kindly—among Government Members. The Secretary of State for Environment, Food and Rural Affairs believes that renewables are very important and that nuclear power has no future. Lord Sainsbury, on the other hand. believes that nuclear power is the best thing since sliced bread and that we should be investing in it as fast as we can. The Secretary of State for Trade and industry is stuck somewhere in the middle, which is why the door to nuclear power has been left open. It would be helpful if the Government finally settled on a view and implemented it, rather than hoping that market forces will dictate. That abdication of responsibility means that renewables will not have the support that hon. Members on both sides—particularly on the Labour Benches—want for that industry. The way things are going, we will not see that.
  Conservative Back Benchers have told us that nuclear power is the solution, and their Front-Bench spokesmen—I hope that the hon. Member for Tewkesbury (Mr. Robertson) will do this—should have the decency to say, if they believe in nuclear power, that it is their policy to have new build. They cannot honestly

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  carry on articulating a need for nuclear power while saying that they have an open mind on whether nuclear new build should occur. New build is a respectable policy; 1 disagree with it, but if it is their policy, they should say so instead of pretending that they are stuck in the middle, like the Government. They do not want to offend the green lobby or someone else, but they should advocate the policy they believe in.
  There are three good reasons why nuclear is not the future and why it would be wrong to go down that road. First, there is security, which is a real issue in the age of terrorism. Nuclear installations and nuclear fuel present a threat and a target, and we should be careful not to exacerbate that. The Government should minimise the exposure of the nuclear industry. For example, they should be minimising transport movements of nuclear material, but they are not. Movements of radioactive material are a matter, they say, for British Nuclear Fuels Ltd. or for British Energy, or for anyone apart from them. In fact, according to answers to my parliamentary questions of last year, unless they have changed their mind since, the Government even allow nuclear material to be carried, in theory at least, on passenger ferries and through the channel tunnel. That is the Government's official position, and if I am wrong on that, the Minister should stand up and say so. That is what his predecessor said in answers to me about a year ago.
  The second issue is cost. Hon. Members, now absent, have berated the cost of wind power. We were told it would be £400 million, and how terrible that is, if it is correct—and I must say that the figure varies from day to day. But there was no mention of the £48 billion that we are being asked to find from the taxpayers' purse to decommission the nuclear industry. That is an enormous sum, and far more has been given over the years to the nuclear industry than to renewables. Parliamentary answers demonstrate that while renewables have been given a pittance—pennies here and there—shovels full of cash have been thrown at the nuclear industry.
  Mr. Laurence Robertson: No matter how much is put into wind power, it will provide electricity only for a small percentage—perhaps only 30 per cent.—of the time. That is the difference. The nuclear industry provides 22 per cent. of all our electricity without failing us at all.
  Norman Baker: There are a number of problems with that. First, we are back to wind power as the only renewable source of energy. Secondly, we are not yet clear whether nuclear new build is Conservative policy—perhaps we should assume that it is. Thirdly, other countries manage to generate much more than 22 per cent. of their energy from renewable sources. I am afraid that that is "three strikes and you're out" for the hon. Member for Tewkesbury on his intervention.
  Mr. Weir: Equally, there is the point that nuclear energy can be interrupted. In fact, Torness in Scotland shut down for a considerable time because of mechanical problems.
  Norman Baker: That is absolutely true and the point should be borne in mind by those who advocate nuclear
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  power. Unlike gas and coal generation of electricity, nuclear power cannot be switched on and off: it has to be kept running.
  The third problem with nuclear power is nuclear waste. We have gigantic amounts of it in this country—
  Mr. Robertson indicated dissent.
  Norman Baker: The hon. Gentleman shakes his head, but we do. I could quote him parliamentary answers from successive Ministers. Furthermore, the Government's own "Consultation Paper on Proposals for Intermediate Level Radioactive Waste Substitution"—a catchy title—means that we will get more waste. The Government will increase the amount of nuclear waste in this country—that is what the consultation paper actually says. One would think that they would at least stop reprocessing, which increases the amount of nuclear waste. I asked the Secretary of State for Environment, Food and Rural Affairs whether she would stop reprocessing and to outline her views. The Minister for the Environment replied:

  "Decisions about whether to reprocess spent nuclear fuel depend on the commercial judgment of the operator concerned."—[Official Report, 23 February 2004; Vol. 418, c. 146W.]

  The commercial judgment of the operator? Where is the Government's bold policy on that? Do we or do we not want more nuclear waste? Do the Government not have a view on that? Is it simply a matter for some company somewhere to decide that they can land the taxpayer of the future with an environmental and a financial liability? That appears to be the Government's abdication of responsibility, so far as the nuclear industry is concerned.
  When the Minister sums up, will he comment on The Sunday Times story—I hope that he will take note of it; he is obviously not listening—that appeared last Sunday, which suggested that 20 kg of radioactive material had gone missing from the midlands? Will he say whether it is true and what the Government are going to do about it? As the Minister is not listening, perhaps the Whip will tell him that I have raised that point and asked him to comment on it when he responds this evening.
  This country needs a proper nuclear policy and a proper energy policy. Energy policy should be based on minimising, through energy conservation and energy efficiency, the amount of energy consumed and having proper investment pump-primed by Government intervention to get the renewables industry going. It should not be just an odd wind turbine here and there, or a pilot plant somewhere else. I mean a proper policy to get renewables up and running to meet the Government's target and beyond.
  We should be looking even further to the coal industry to establish how coal generation could be made more acceptable. In another parliamentary question, I asked about the gasification of coal. Labour Members who represent mining constituencies might be interested to hear the answer. I asked

  "what percentage of power was derived from gasified coal in 2003."

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  The Minister for Energy, E-Commerce and Postal Services replied:

  "Currently in the UK there is no power produced through coal gasification."—[Official Report, 6 May 2004: Vol. 420, c. 736W.]

  Why not? What have the Government been doing over the past six years to help the coal industry to ensure that our indigenous supply is used while at the same time meeting proper environmental standards? What has happened in the past six years? The Government need an energy policy, and they need it now.
  8.58 pm
  Dr. Alan Whitehead: We have had a rather odd debate about this important Bill. Claims have been made that wind power is the only trick in the magic box, that the Government claim that it will solve everything and that we should also examine other sources. As far as I am aware, the Government and Labour Members have never claimed that that is the future for renewables. Indeed, page 55 of the White Paper includes a timeline for a whole variety of renewables coming on stream over a period, which will create the mix of renewables that hon. Members have spoken about.
  We must emphasise, however, that it is a race against time. We cannot just say that we should have a good think about various alternatives and discuss the best option over a period without taking any decisions. As my hon. Friend the Member for Brighton, Kemptown (Dr. Turner) explained, we are producing ever-increasing amounts of CO2, which is causing enormous and possibly irreversible damage to our environment. The question is whether we start the movement towards renewables now, with the technologies that we have and bring others on line later, or talk about the technologies that we would like to have and do nothing. If we are not careful, we will be here in 50 years talking about what sort of renewables we would like. However, we will not be here in 50 years if we carry on business as usual in terms of energy use, because this building will have been flooded.
  The White Paper is ambitious and I was proud to have it published. I was proud that the Government emphasised a long-term aim of a 60 per cent. reduction in carbon emissions by 2050, but that is of course a target and not actual energy reduction. The changing picture of UK energy production requires huge action. It has been estimated that to meet the Government's target of 10 per cent. of energy from renewable sources by 2010, some 3,500 to 5,000 wind turbines would be required. That would fulfil only the wind element of the target of some 7 per cent., with the remaining 3 per cent. met by other renewable energy sources. That could involve a variety of systems, which could contribute to a secure and reliable system. As hon. Members have already mentioned, wind is intermittent, but other renewable sources—tide, wave and biomass—are not. It is a failure of the imagination to think that the only way to secure a baseline of power—and a different arrangement for the distribution of power—is by continuing to churn out power in the centralised way that we always have.
  The DTI has said that the potential resource for wind in our territorial seas comes to 200 GW, or three times the present UK generating capacity. If we went beyond
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  territorial waters, a further 130 GW, or twice the UK's present generating capacity of 68 GW, would be available. That estimate excludes any conflict with oil exploration or production, with aggregate extraction or with shipping lanes.
  We have heard today that we need to replace nuclear capacity, and I agree with the hon. Member for Lewes (Norman Baker) that it is time that Conservative Front Benchers admitted, "We would like to build lots of nuclear power stations. Can we start tomorrow because that is our policy?" It is not tenable for the Conservatives to continue their patsy game.
  Mr. Laurence Robertson: I have tried to resist intervening on this topic, but I must point out that no Government would write a cheque for the building of new nuclear power stations. We believe in the market and it would be up to the market. Our point is that it is up to the Minister to create the economic conditions that will encourage investment to achieve security of supply. The coal industry is under environmental threat, gas will have to be imported from long distances and we struggle to meet renewables targets, so it is up to the Government to say how security of supply will be achieved.
  Dr. Whitehead: That clears that up, then. The hon. Gentleman and his colleagues have already said that they do not have a policy, but they do not agree with wind power or with encouraging renewable sources as the Government suggest. The Conservatives have implied that it would be a good idea to go down the nuclear route, but they will not come out and actually say that. Indeed, the hon. Gentleman has just confirmed that.
  Even if we did replace the entire present nuclear capacity with wind turbines—I do not anticipate that that will happen—we would need some 10,000 to 15,000, and some people think that that is an unachievable target. Germany already has 14,000 wind turbines in operation and the country is not covered with them. Nor has Germany failed to make progress in wind turbine technology, because it has begun to install them over the past 15 years.
  Capacity could also be derived from biofuels, as'hon. Members have mentioned. About 5 per cent. of arable land, much of it currently fallow, would be needed to meet EU biofuel targets of 6.7 per cent. Tidal power, which has already been mentioned by my hon. Friend the Member for Brighton, Kemptown, could provide twice the UK's generating capacity. The truth is that there is the capacity, both in base-load generation and intermittent generation, to produce a large proportion of the UK's energy supply through renewables.
  Realistically, the choice is between business as usual, renewable technologies that are coming on stream—and ensuring that those work well—or simply going nuclear. Real licences and real generation are needed now. We have to overcome a number of hurdles. Hon. Members have already mentioned shipping lanes and the objections of the Ministry of Defence. I do not think that those are insuperable objections; they can be negotiated and discussed.
  We must sort out the matter of renewable obligation certificates. The design of the renewable obligation system should not cause the system to come close to

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  collapse because certain firms go out of business and do not meet their obligations. We must have a more stable system that produces a more stable price.
  However, those are matters of detail. It is vital that we make use of all the renewable technologies we can, and make greater use of CHP. If the Government want to resist clause 120, I would suggest that they convert its provisions to a power for the Minister, so that it can remain in the Bill, along with clause 128.
  Overall, I think the Bill is to be welcomed. It is part of a jigsaw, as my hon. Friend the Member for Ochil (Mr. O'Neill) said, but it represents real progress towards the 20 per cent. target for renewable energy by 2020. Wind power will not solve tin problem, but the Bill will go a considerable way towards reaching that target.
  9.7 pm
  Mr. Calum MacDonald: As my right hon. Friend the Member for Airdrie and Shotts (Mrs. Liddell) said, I have a very important constituency interest in the Bill and the topic of meeting the Government's renewable energy targets. As many hon. Members have pointed out, the targets are very demanding and ambitious. After many years of neglect of renewables by previous Governments, the Labour Government, in pursuing their policy, have to break through what seems to be a wall of scepticism—or at least a great deal of uncertainty—among people in industry about the viability of meeting those targets.
  That atmosphere of uncertainty will be added to by the various contributions from Conservative Members during the debate, in which they revealed once again their long-standing hostility towards the development of renewables. If the Government are to overcome that scepticism, and break through that uncertainty, they have not only to announce targets, but to encourage and push industry to meet those targets To meet even the 2010 target, we shall have to build about 1,000 turbines each year in the run-up to that date. Sadly, each development comes up against a wall of obstructions and objections of various kinds, and threats of legal action that could take years to settle.
  It is unfortunate that, sometimes, some of those obstructions are thrown up by various Departments, quangos and Government agencies that seem not yet joined up to the central thrust of the Government's renewables strategy—notably the Ministry of Defence, but also arm's-length agencies such as the Civil Aviation Authority, the air traffic control system and environmental agencies such as Scottish Natural Heritage.
  It is understandable that some of those public sector bodies will have points of view about the development of wind farms—they have legitimate remits to deliver—but we need to remember that each of them is, in essence, the equivalent of a single-issue pressure group; they have a narrow focus on the renewables issue. If the renewables strategy is to be delivered, it is important that the Government pull together the different strands to achieve some joined-up government between those Departments and the various agencies.
  The hon. Member for Waveney (Mr. Blizzard) pointed out in his excellent speech that the United Kingdom has the best wind and wave resources in
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  Europe. The best resource in the United Kingdom is to be found in the highlands and islands, especially in the outer islands of the Western Isles and in Orkney and Shetland. The average efficiency of wind farms has been mentioned during the debate. The percentage figure given was somewhere in the high 20s, but I am told by AMEC—the leading developer—that the efficiency of wind turbines is between 40 and 50 per cent. in the outer islands of Scotland. The nation needs to harness that huge resource to meet its renewables targets in the run-up to 2010. Indeed, if we look beyond 2010, as we move into the hydrogen-based economy, that huge resource could produce perhaps one of the most cost-effective sources of hydrogen in the United Kingdom and, indeed, in Europe.
  To realise that potential the Government must ensure that two things happen. First, a genuinely national, UK grid must be constructed which links the generating capacity of the north of Scotland with the markets of the south of England. Scottish and Southern Energy, which owns the grid in the north of Scotland, as well as supplying customers in the south of England, estimates that it would cost £200 million to upgrade the grid to connect the highlands to the central belt—a project that it hopes to begin building early next year—but that a further £500 million would be required to connect the three main island groups to the mainland and to harness their resources for the good of the whole nation. Those are large sums, but they are well worth spending.
  Three separate wind farm developments have been proposed in the Western Isles—planning applications will be made during the year—and, taken together, they will have an installed capacity of more than 1,000 MW. That is a huge resource for the nation, but its development will obviously bring massive economic benefits to those remote and economically marginal communities. The development of renewables could end 100 years of low growth and economic underdevelopment in the outer islands of Scotland, and transform them into an economic asset for the whole nation. That double benefit—for nation and for region—should be in the front of Ministers' minds when they talk to Ofgem about the need to upgrade the grid in the coming months.
  The second big obstacle, which must be overcome, is the creation of a level playing field, so that all generators across the UK are equally able to gain access to the grid. There is serious worry and concern that, compared with generators elsewhere, those in the north of Scotland will end up at a disadvantage under the BETTA rules when the new, British-wide electricity trading arrangements get under way. I am delighted that the Government have responded to those concerns in clauses 175 and 176 and especially in clause 181, but we are still far from seeing the details—the flesh on the bones—of how that new fair and level playing field will be established, and I look forward to hearing more about that during the Bill's consideration.
  9.14 pm
  Paddy Tipping: This is an important Bill, because it helps to deliver the aspirations in the Government's energy White Paper. By itself, it will not deliver those aspirations, because the White Paper is a step change from the past to the future—from a fossil-dominated economy to a carbon-free economy.

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  Achieving 60 per cent. carbon reductions by 2050 is extremely challenging, and becoming a net importer of energy in just a few years' time is a matter about which the Government should be seriously concerned.
  Climate change has hardly been mentioned in the debate, but it is the big political issue of our time. If we are to achieve the White Paper's targets of 10 per cent. of energy from renewables by 2010 and 20 per cent. by 2020, we must work quickly, because we start from a very low base.
  There has been a good deal of discussion in the debate about wind power. It is clear to me that wind power by itself—particularly onshore wind power—faces real difficulties. The Government are committed to offshore wind power, and the first field at North Hoyle came on stream just last year. Offshore wind power has remarkable possibilities, but there are difficulties, and my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) outlined some of them. We need to go further than the Bill and consider a marine environment Bill to consider the conflicts in the marine environment. I am not confident that we have joined-up government on the issue.
  If we do not reach the renewables targets, we will face great difficulties in the mid-term. Security of supply has been mentioned throughout the debate, but I would be very worried if by 2020 or 2025, 70 per cent. of our energy needs were supplied from abroad, 90 per cent. of which were gas. The events of 11 September have changed the world. The war in Iraq has shown that diplomacy cannot solve everything. We will face difficulties if our renewables targets are not met and if we are so heavily dependent on gas. Hon. Friends have pointed out that there are other sources of renewables, but wind power will drive our renewables forward in the mid-term.
  If we do not meet our targets, what else would need to be done? It is absolutely clear that the nuclear option needs to remain open. There is no prospect of the market or the private sector replacing nuclear with nuclear just now. We need to look further afield.
  Many of my hon. Friends have made a strong case for coal. I find it astonishing that Japan, which has no indigenous coal industry, spends more on research on clean coal technology than we do. We need to move harder and faster to bring investment into new forms of clean coal technology. We need a more stable market and a place for coal in the energy market to encourage private sector investment. That will not come in by itself. We need to consider carefully how the Government can take the prospects for clean coal technology further. Coal burn will increase across the world, and we can develop the new technologies. We are in a strong position to exploit them.
  I have previously discussed the large combustion plant directive with my hon. Friend the Minister, and I will not pursue the point today. However, I will remind him that coal mine methane is a real problem. I hear stories coming from his Department that the study into coal mine methane advocates its flaring and burning. Let me make it clear to my hon. Friend that that would not fit well with our White Paper commitments.
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  A number of hon. Members have talked about biofuels. In the short term, they are the only way of reducing carbon emissions in the transport sector—a sector in which emissions are increasing. It is important that we use the renewables obligation to encourage our indigenous industry. There is a danger that our needs will be sucked up abroad.
  I conclude with something that I raised in an intervention. I am extremely worried about the future cost and price of energy. We have been fortunate to have had relatively low energy prices in the past two decades, but the cycle has turned, as the White Paper acknowledges. I think that there will be sharply increasing energy prices in the next decade. Many little additional bills will be created by the White Paper. The renewables obligation has been mentioned. The emissions trading scheme will also add to costs. We need to rewire Britain, and there has been a consensus on that. If we are to have sources of renewable power, will they come from peripheral supplies, because the cost of rewiring Britain will be fairly steep?
  The big demand for energy conservation measures will also add to costs. The White Paper is clear on that: it predicts that energy prices will rise by 5 to 15 per cent. for the householder and by 10 to 25 per cent. for the industrial user. I think that those figures are on the low side and energy prices will increase rapidly. Conceptually, that is not a bad thing. We should charge more for activities that harm our environment, but if we accept that energy prices are to rise, we need to think through much more carefully the social, economic and political costs of that. I hope to have the opportunity to explore all those issues in more detail in Committee.
  9.22 pm
  Brian White: One of the disappointing things about the debate in the Lords and the Chamber today is the way in which different energies have been set up against each other. We have had a rather sterile debate in which energy A is better than energy B. The renewables versus nuclear debate is false and I hope that we move away from it in Committee.
  As little time is available, I shall not talk about nuclear energy, energy zones or security of supply. I suppose someone has to welcome part 1, and given that many of its clauses use the original wording of the Sustainable Energy Bill, my private Member's Bill of a year ago, I should probably be the one to do that. If the Government are minded to remove those clauses, and I understand why they might, perhaps I can remind them of the Minister's response in Committee. The issues that the clauses address will not go away, and he needs to have a transparent response to people who advocate their removal. The strategy for dealing with their removal must be clear.
  I was a member of the Committee that considered the Utilities Bill; indeed, someone once called me a refugee from that Bill. One issue that arose was how NETA was implemented. Warnings were given about its impact on small companies. I moved amendments that would have allowed us to avoid some of the problems encountered by combined heat and power, but Ministers were sceptical. We need to return to the lesson of how NETA was introduced and ensure that the mistakes made then are not replicated when we introduce BETTA.

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  We also need to recognise that we have lived in an era of overcapacity and low prices and that that era is over. We need to consider how the issues apply in an era of rising prices. There is also an issue to do with how we deal with CHP in that scenario.
  We have been promised a review of the renewables obligation in 2005, but I think that we ought to use the opportunity of the Bill to address the problems of the CHP industry now, rather than waiting until 2006. Ministers are well aware, from representations from companies such as Conoco Philips, of the problems that the industry is having. It is important that we address some of those serious concerns when we come to discuss clause 120.
  I understand that the DTI has several objections to CHP, but many of those stem from the scale of new CHP technology that is likely to be introduced. My concern is that the Cambridge model that the Department has used is fundamentally flawed. I question the robustness of that economic modelling, which predicts that 284 MW of new build is likely to result from the renewables exemption. Even the Department accepts that there is uncertainty about that. There is a lot of discussion about the impact on renewables, but many renewables companies say that removing the obligation on CHP will not affect their investment decisions. We need to discuss those issues in Committee because they, rather than the clause, point the way forward. If Ministers do not it rule out, removing the obligation would be a better way forward than removing the clause.
  The operation of Ofgem under the new arrangements is critical, particularly to the role of smaller companies. In the short time available to me, I want to welcome clause 129 on microgeneration; it is very important and has not been highlighted enough tonight.
  The measures in the Government's statement following the energy efficiency review need to be implemented as quickly as possible. I urge the Minister to use not only this Bill but the spending review to do that.
  Opposition Members were absolutely right to talk about bioethanol. We could blend biofuels into petrol, which would solve the problems caused by Customs and Excise requiring 100 per cent, duty on the use of biofuels, which requires new build. rather than allowing the use of 70 or 60 per cent. biofuels and charging duty pro rata. I will go into the issues concerning bioethanol in more detail if I am lucky enough to be on the Committee.
  My hon. Friend the Member for Brighton, Kemptown (Dr. Turner) referred to fuel poverty, which in an era of rising prices will not go away; it needs to be addressed. We will touch on that issue again tomorrow when we discuss the Housing Bill. As the lead Department on the matter, the DTI has played its role very well so far, but in future its commitment to eradicating fuel poverty will be critical.
  The investment climate has not really been discussed tonight. The Bill highlights the question of how we give the City certainty without long-term investment in energy needs, particularly in renewables and CHP but also as new arrangements are introduced. It is important that we stimulate the markets. Points were made earlier
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  about how a market can come to maturity. The Bill does not cover that, but again I am sure that the debates in Committee will.
  In conclusion, we are at a critical stage in developing our energy policy. The role of Finland has been mentioned a couple of times tonight. Given that the President of Finland is visiting the UK tomorrow, I am sure that she would be interested to hear some of the comments that have been made about how well the country has dealt with its energy policy, and how it had a mature debate about whether to return to nuclear energy. We can learn a lot from what Finland has been through.
  The concerns that have been expressed today, particularly about CHP, the industry renewables and the regulatory barriers for small companies, need to be addressed, and I look forward to doing that in Committee if I am lucky enough to be a member.
  9.29 pm
  Mr. Laurence Robertson: This has been an interesting debate. I have counted 24 speakers so far, and I hope to be forgiven for not mentioning each and every contribution. The debate has ranged widely. When one speaks with the various interests in the power industry, one hears many different views expressed, so it does credit to the House of Commons that different views have been expressed by hon. Members during this good debate on an extremely important issue.
  When people wake up in the morning, they might not think about the energy supply until they flick the light switch and the light does not come on; then, it becomes an very important matter. Of course, it is important, because the first thing people do when starting their day is use one form of energy or another. I am grateful to all who have participated in the debate, but I shall be forgiven for mentioning in particular my right hon. and hon. Friends.
  My hon. Friend the Member for Blaby (Mr. Robathan) spoke of his personal experiences of renewables—
  Mr. Timms: Where is he?
  Mr. Robertson: I do not know. The winding-up speeches have started a little sooner than anticipated, but perhaps my hon. Friend is on his way. He spoke about his solar panel and his windmill in his back garden. My hon. Friend the Member for South-West Hertfordshire (Mr. Page) made his usual considered and sensible speech, and my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard) spoke knowledgeably about biofuels. My hon. Friend the Member for Salisbury (Mr. Key) made a broad-based and interesting speech, and my right hon. Friend the Member for Fylde (Mr. Jack) broadened the debate still further, speaking not only about the security of physical supplies, but about economic security. He did not go so far as to say that the world would be troubled were a gas producers' equivalent of the Organisation of Petroleum Exporting Countries to arise, but I am sure that that is the sort of thing he had in mind. Given the recent increase in oil prices, we have to consider that possibility.

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  My hon. Friend the Member for Ribble Valley (Mr. Evans) made a passionate speech. He tended to focus on windmills, but he was speaking from experience. It is wrong of Labour Members to accuse some hon. Members and members of the public of being nimbies. There is little wrong with being a nimby if it means that one defends the area in which one lives and wants to preserve its beauty and economic prosperity, as people in the lake district want to do.
  I hope that Members representing other parties will forgive me for not going through every one of their speeches, but some very interesting contributions were made. The right hon. Member for Copeland (Dr. Cunningham) spoke with his customary knowledge. I was in Sellafield fairly recently—I hope that I wrote to him at the time to inform him, but fear that I might have been a day late in doing so, and postal strikes do not help. It must have been in the second delivery, which never arrived.[Laughter.] When I was there, I saw how crucial the nuclear industry is to the area. It was noticeable that support for the industry cut across the political divide—
  Dr. Jack Cunningham: Not them.
  Mr. Robertson: No, not the Liberals. I shall not name the people I met, but the industry appeared to command great support from the Labour party, from the trade unions whose representatives I met, and of course from the Conservatives.
  There were many other interesting speeches, including from hon. Members who are concerned about the coal industry. As the son of a former miner, I can certainly sympathise with the sentiments that they expressed.
  This is an interesting time to be having this debate, an interesting time for the Minister for Energy, E-Commerce and Postal Services to be holding his portfolio, and an interesting time for me to shadow him. We in this country have enjoyed 30 years of security of power, which has benefited not only those who use power, but the Exchequer. That, of course, is now changing, and we must recognise that. Indigenous gas and oil supplies are running down, there are strong nobody should underestimate them—environmental challenges to the coal industry, and renewables are struggling to keep pace. It will be a challenge, in which I hope that the Government will succeed, to meet the targets set for renewables. As my hon. Friend the Member for Eddisbury (Mr. O'Brien) said in an outstanding opening speech, in less than 20 years' time, unless nuclear power plants are extended, nuclear will be reduced to providing just 2 per cent. of electricity in this country. Some Labour Members—not all by any means—might welcome that, but those who do must explain how the remaining 20 per cent. will be made up. As has been explained, if it is made up from renewables, we may replace that capacity, but in terms of carbon emissions, we will have gone nowhere. We must bear that in mind.
  In terms of financing of new generation and the direction of energy policy in this country, we are at a crossroads. As has been said, we want to avoid an over-
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  dependence on any one form of energy, including nuclear, coal and gas, if that gas must come not only from Norway but all the way from Russia. As has been said, we are at the end of a very long pipeline, with all the implications that go with it. We might ask the people, "Would you like to be dependent on imported gas from countries such as Russia?" As for honouring commitments, by and large, it does so, but Lithuania and Belarus might not agree, because both have recently had their supplies cut off by Russia for political reasons. Let us bear that in mind. Were we to ask people whether they wanted to be in that situation, in which the vast bulk of our gas was imported, they would say no. We must think again.
  The White Paper, on the back of which this Bill has been introduced, raises some commendable objectives: security of supply, reduction in carbon and reduction in the numbers of fuel-poor consumers. We would all say that those three are worthy objectives. The problem is that they are conflicting. They are made more difficult by the changing atmosphere and circumstances in this country. I have been in the Chamber for the whole debate apart from one speech, and I apologise to the hon. Member for Bolton, South-East (Dr. Iddon) for missing his. When I nipped out, however, I caught a news item in which the chief executive of Powergen, Paul Golby, said that a 20 per cent. rise in prices of electricity over the next decade is possible, and that a massive amount of investment is needed in the industry—between £50 billion and £70 billion—to secure supply. That is an awful lot of money, and the suggestion is not from someone who is ignorant of the facts.
  Given the White Paper, and the difficulties to which the White Paper has perhaps drawn attention without pointing the way to a solution, we generally welcome the Bill, especially as it has been greatly improved, as my hon. Friend the Member for Eddisbury said, by the sterling work carried out in the other place, principally by Conservative peers, although occasionally—I am sure it was a mental aberration—they were supported by the Liberal Democrats.
  Mr. Stunellrose—
  Mr. Robertson: I knew that I should not have said that. Can the hon. Gentleman be quick, as I do not get time added on?
  Mr. Stunell: Absolutely. May I point out to the hon. Gentleman that all the amendments passed in the other place were either proposed by the Liberal Democrats or directly supported by them?
  Mr. Robertson: Perhaps we will save the details for the Committee stage.
  This debate is taking place in an atmosphere different from the one which would have existed before privatisation. Great advances have been made in the industry, but the whole House would agree that we need to go beyond this Bill. It is a start, and we welcome much that is in it, so much so that we will seek to hang on to quite a few of the amendments passed in the other place. I do not understand why the Government are having such difficulties with the amendments on combined heat and power, for instance. When I met representatives of

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  the Combined Heat and Power Association recently, I was told that it had generating capacity that was not being used.
  There is an interesting amendment concerning micropower, and as the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) pointed out, there are navigation amendments. There is also a biofuels amendment. We shall look at all those closely, because we think that they improve what was rather a bland Bill.
  The Secretary of State said that clause 1, which began as an amendment, was superfluous. It relates to the security of supply. We look forward to seeing how the Government manage to wriggle out of their duties in that regard.
  Unfortunately, in this industry we do not have the free market that everyone assumes, or claims, that we have. Perhaps the Minister will tell us what will happen to British Energy when the NDA is established. Is it intended that the NDA will take over some of British Energy's liabilities? If so, will the Minister tell us whether he has taken legal advice from the European Union? I understand that a recent report—it may have been published only yesterday—suggested that such intervention might infringe EU rules I do not say that to be awkward; I feel that it should be considered, although we support the establishment of the NDA.
  We have heard a great deal about two aspects of electricity generation. One is wind—there has been a lot of hot air about that—and the other is the nuclear industry. I do not want to spend too much time discussing those two issues, but I should point out that we are not for or against one form of energy or another. What we are in favour of is security of supply.
  At present, 22 per cent. of our country's electricity is generated from renewable sources. If that is to be allowed to decline, it is up to the Government of the day to tell us where they will find the extra electricity to replace it. Are we to have wind farms or windmills all over the country? They are intermittent, and building and maintaining them will be costly. Thankfully, they will not need to be maintained for very long because they do not last for more than about 20 years. Given those factors and the cost of the electricity they will produce, it will be up to the Government of the day to explain why so much energy is being focused on the development of wind power to the exclusion—seemingly—of other forms of renewable energy such as thermal and solar power, and possibly fusion—my hon. Friend the Member for Eddisbury mentioned that possibility.
  It has been a privilege to take part in such an interesting and crucial debate. I hope that the Minister will answer some of my questions, and, more important, the many questions asked by Members in all parts of the House and representing every possible energy interest.
  9.43 pm
  The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): I agree with the hon. Member for Tewkesbury (Mr. Robertson) that this has been an interesting debate, featuring a range of constructive contributions from Members in all parts of the House. That reflects a growing interest in energy matters throughout the country, which I welcome.
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  I pay tribute to my noble Friends Lord Whitty, Lord Davies and Lord Triesman for their work on behalf of the Government. A number of improvements were made to the Bill in the other place, although I should add that not all the changes constitute improvements. We shall look carefully at some of them in Committee.
  I was pleased by the general welcome to the Bill given by the hon. Members for Eddisbury (Mr. O'Brien) and for Tewkesbury. I shall return shortly to some of their specific criticisms. First, however, let me remind the House of the four goals for energy policy proposed in last year's energy White Paper. The first was putting ourselves on a path to cut UK carbon dioxide emissions by 60 per cent. by 2050. The second was to maintain the reliability of energy supplies. The third was to promote competitive markets. The fourth was to ensure that every home was adequately and affordably heated. It is important that we achieve all four together. We are not looking to give up on one to achieve another. The package is designed to be, and needs to be, delivered as a whole.
  We can point to excellent progress on implementing the White Paper, as the first annual report, which was published a couple of weeks ago, shows. The Bill puts in place key parts of the jigsaw to enable that progress to continue.
  We now have scientific consensus that climate change is for real, that carbon emissions are causing it and that it poses an immense threat to all of us. My hon. Friends the Members for Brighton, Kemptown (Dr. Turner), for Sherwood (Paddy Tipping) and for Southampton, Test (Dr. Whitehead) were right to draw that to the House's attention. That consensus extends to the National Academy of Sciences in the United States. The hon. Member for Blaby (Mr. Robathan) was right to draw attention to the recent scientific contribution from the US—hoping that climate change will go away is not an option. The challenge of climate change requires an urgent and serious response. The Bill's provisions—for example, those on offshore renewable energy—are a key contribution.
  Energy security considerations are also vital. Over the next few years, the self-sufficieny in energy that we have enjoyed thanks to North sea oil will end. In itself, that is not a worry. Among the G7 countries, only the UK and Canada are self-sufficient in energy, so we will move to a position that is the norm among industrialised countries. It is a transition that we can manage successfully, but we will need to ensure that we have sufficient diverse sources of gas. We also need to look for new sources of electricity generation under wholly UK management. For that reason, too, the Bill's provisions on renewable energy are vital. The wider issues of security will be an important theme of debates on the Bill.
  A number of other provisions in the Bill are aimed at underpinning secure and reliable supplies: for example, part 4 on the special administration regime for energy network companies, and the arrangements for interconnectors in part 5. In addition, as we have heard, the Bill puts in place vital new arrangements, which have been widely welcomed, for setting up the nuclear decommissioning authority to get to grips with the challenges of our nuclear legacy. The NDA will drive

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  work on clean-up, provide the long-term strategic direction that is needed and help to deliver long-term efficiency savings to the taxpayer.
  The hon. Member for Eddisbury made the point that the security of supply clause—I think these were his words—is not a prelude to interventionism. That is not how the industry has read it, as I think he will know, and the industry is right. It is no good him telling the House that he did not mean to imply that, because the views of the industry have been clear. My right hon. Friend the Secretary of State quoted Mark Clare of British Gas. The hon. Member for Tewkesbury quoted Paul Golby of Powergen. Powergen's brief makes the point that the clause as currently construed could undermine the independence of the regulator, make ad hoc Government intervention in the markets more likely and add to investors' perceptions of risks, making investment more difficult. The Chemical Industries Association has pointed out that more central planning inevitably has to be paid for by consumers. So it goes on. The provision would represent a huge shift backwards to state intervention, in which the Conservative party is not normally in favour.
  I will be happy to talk to the hon. Member for Eddisbury about a way forward. He and his colleagues in another place were right to draw attention to the importance of security of supply. A shared way forward other than the one currently in the Bill may be available. Perhaps the hon. Member for Tewkesbury was alluding to that, too.
  There have been a couple of references to the interesting PricewaterhouseCoopers survey. The head of the utilities at PricewaterhouseCoopers said that a consistent and stable regulatory environment is required to make the sector more attractive to investors. That is the point, and that is what we have to deliver.
  I welcome what sounded to me like the hon. Member for Eddisbury's adoption of the White Paper policy on nuclear energy: that of keeping the options open, a position his party has strongly criticised. In fact, the hon. Member for South-West Hertfordshire (Mr. Page) strongly criticised it again today, presumably not having noticed that his hon. Friend had said that it was now his party's policy. It would also have come as something of a surprise to a number of his noble Friends in the other place. Nevertheless, I welcome that change of heart, if that is what it is.
  We sometimes hear that if only the Government accepted the need to build new nuclear power stations, the twin challenges of carbon emissions and energy security could be readily resolved. We may well need new nuclear capacity, but I have yet to meet anyone who wants to invest in new nuclear power stations in Britain at the moment. My hon. Friend the Member for Dumfries (Mr. Brown) made an important point along those lines. It is the same in the United States, where there is a strong pro-nuclear policy, but getting people to make commitments has been extraordinarily difficult. It will be a considerable time before there are new nuclear power stations in the USA, let alone in the UK. We need that dose of realism in the debate and I welcome the Conservative party's change of heart.
  Mr. Laurence Robertson: It is noticeable that the Minister excluded Finland from his list of examples. It
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  decided that it needed a new nuclear reactor because it did not want to be over-dependent on imported gas from Russia. It also has a consortium of businesses to invest in the building of that new nuclear reactor, on the promise that the electricity it produces will be bought.
  Mr. Timms: The hon. Gentleman is right to draw attention to Finland, as did my hon. Friend the Member for Bolton, South-East (Dr. Iddon). There are important lessons to he learned there, but I repeat that I have yet to meet anyone who wants to invest in new nuclear power stations in the UK. The position may well change in future, in which case we will consider that, as the White Paper made clear.
  My right hon. Friend the Member for Copeland (Dr. Cunningham) paid tribute to his constituents and those of other hon. Members who work at Sellafield, and I endorse that.
  On wind energy, every megawatt-hour of electricity generated from a wind turbine is nearly 200 cu m of gas that does not need to be burned. It is important that the UK plays a leading role in the move to a more sustainable energy economy.
  My right hon. Friend t0he Member for Copeland was right to draw attention to the employment importance of nuclear industries for his constituents. I was concerned to hear what he said about difficulties in the supply chain among his constituents. We have wanted to do everything we can to ensure that the supply chain is kept informed of work on the Sellafield near-term work plan. There have been three supplier forums recently on that, but if there are particular problems I should be grateful if my right hon. Friend dropped me a line and I will be glad to take them up.
  Dr. Jack Cunningham: I can do better than drop my hon. Friend a line; I can repeat what I said earlier. There are already, I regret to say, real problems in the supply chain of support industries in west Cumbria because of the hiatus that has been caused by the proposals to create the nuclear decommissioning authority and because of BNFL so far refusing to bring forward its near-term work plan. That is threatening jobs in the west Cumbrian economy now.
  Mr. Timms: I am grateful to my right hon. Friend and I shall certainly look at his point. He would agree that his point underlines the importance of securing the timely enactment of the Bill so that we can press ahead with establishing the NDA on the timetable that has been announced and thus ensure that any hiatus is minimised.
  The hon. Member for Hazel Grove (Mr. Stunell) talked about the annual report on energy efficiency. I hope that I was able to make the position clear; we expect carbon savings from energy efficiency overall—household plus business—to be greater than they were in the White Paper because of the greater contribution from businesses. I can give him a firm assurance that we will hit our Kyoto targets—the UK is one of only a handful of EU member states to be in that position. Indeed, our target is to go further and achieve savings of 20 per cent. in UK carbon emissions by 2010.
  My hon. Friend the Member for Ochil (Mr. O'Neill) made some important points, as did my hon. Friend the Member for Milton Keynes, North-East (Brian White),

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  on combined heat and power. My hon. Friend the Member for Milton Keynes, North-East referred to the Cambridge study, which indicates a central projection of 8.1 GW of good quality CHP capacity by 2010, in a range of 7.7 to 9.4 GW. I know that he was critical of that study, but we have to add to that an expected contribution from the European Union emissions trading scheme. We have said that we will review the support for CHP alongside the review of the renewables obligation next year, but I caution against a view that we can somehow use the renewables obligation to deliver what we want on CHP as well. That would fatally undermine the renewables obligation just at the time when we are at last starting to see the momentum behind the investment that we need. My hon. Friend the Member for Milton Keynes, North-East has been a strong advocate of CHP, not least through his private Member's Bill, and he will know that quite a lot of work is going on to support CHP. I take his point, however, about the challenge that remains.
  I pay tribute to my right hon. Friend the Member for Airdrie and Shotts (Mrs. Liddell) for her work as my predecessor in this role. I agree with her about the benefits of competitive pricing that BETTA will deliver to her constituents. She also made important points about skills in decommissioning, and clean coal. My hon. Friend the Member for Barnsley, West and Penistone (Mr. Clapham), too, drew attention to the importance of clean coal, as did other hon. Members. The technology programme for clean coal that we are taking forward will continue until the end of 2006, with a fourth and final call for proposals being made at the end of this year. That will involve some £4 million. We expect to announce the successful projects at the end of the year, and, in addition, the new carbon abatement technology strategy will identify programmes to replace the existing cleaner coal technology programme. That is expected to receive similar levels of Government funding.
  My hon. Friend the Member for Sherwood, like my hon. Friend the Member for Barnsley, West and Penistone, raised concerns, which I well understand, about the large combustion plants directive. I have listened carefully to the concerns that he and the coal industry have expressed. He will know that other parts of industry have diametrically opposed views, so we are looking very carefully at the analysis that we have commissioned.
  My hon. Friend the Member for Waveney (Mr. Blizzard), in an excellent speech on the importance of wind power, rightly welcomed the extension of the renewables obligation to 15.4 per cent. by 2015–16. I look forward very much to visiting Scroby Sands next week.
  My hon. Friend the Member for Western Isles (Mr. MacDonald) underlined the important point that in many areas of the country there is strong support for making progress on wind energy. The Western Isles is one area where that is very much the case, and he was right to draw attention to what he called the huge resource for the nation that is available there.
  My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) raised concerns reflected in the recent Transport Committee report on navigational hazards and the Energy Bill, which we have welcomed. We see that report as an important contribution to
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  consideration of how offshore renewables and shipping industries can co-exist. There have been discussions with shipping interests, and I have met representatives of the Chamber of Shipping, following that up with a letter. I can tell my hon. Friend that Government consents will not be given to any wind farm developments that would be a danger to navigation. She mentioned the idea of safety zones, which the Chamber of Shipping has raised, and which I welcome.
  We have had an excellent debate and I commend the Bill to the House.
  Question put and agreed to.
  Bill accordingly read a Second time.

  ENERGY BILL [LORDS] (PROGRAMME)
  Motion made, and Question put forthwith, pursuant to Orders [28 June 2001 and 6 November 2003],
  That the following provisions shall apply to the Energy Bill[Lords]:
  7. Any other proceedings on the Bill (including any proceedings on consideration of Lords amendments or on any further message from the Lords) may be programmed.—[Charlotte Atkins.]
  Question agreed to.

  ENERGY BILL [LORDS] (PROGRAMME)
    Committal
    1. The Bill shall be committed to a Standing Committee.

    Proceedings in Standing Committee
    2. Proceedings in the Standing Committee shall (so far as not previously concluded) be brought to a conclusion on 24th June 2004.
    3. The Standing Committee shall have leave to sit twice on the first day on which it meets.

    Consideration and Third Reading
    4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.
    5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on the day on which proceedings on consideration are commenced.
    6. Sessional Order B (programming committees) made by the House on 28th June 2001 shall not apply to proceedings on consideration and Third Reading.

  ENERGY BILL [LORDS] [MONEY]
  Queen's recommendation having been signified—
  Motion made, and Question put forthwith, pursuant to Standing Order No. 52 (Money resolutions and ways and means resolutions in connection with bills),
  That, for the purposes of any Act resulting from the Energy Bill [Lords], it is expedient to authorise—

  (1)the payment out of money provided by Parliament of any expenditure incurred by the Secretary of State under or as a result of—

  (a)any option under which he or his nominee may acquire an undertaking or property from British Energy plc or a company that is or has been a subsidiary of British Energy plc, or

  (b)any agreement entered into for the purpose of giving effect to the provisions of such an option, or of continuing or modifying their effect,

  (2)the payment out of money provided by Parliament of any expenditure incurred by a Minister of the Crown or the Treasury in respect of the acquisition of securities of a company to which transfers authorised by the Act are made or in respect of the acquisition of rights to subscribe for such securities,

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  (3)the payment out of money provided by Parliament of any expenditure incurred by a Minister of the Crown for or in connection with the carrying out of any of his functions under the Act, and

  (4)the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable out of money so provided by virtue of any other Act.—[Charlotte Atkins.]

  Question agreed to.

  ENERGY BILL [LORDS] (WAYS AND MEANS]
  Motion made, and Question put forthwith, pursuant to Standing Order No. 52 (Money resolutions and ways and means resolutions in connection with bills),
  That, for the purposes of any Act resulting from the Energy Bill [Lords] ("the Act") it is expedient to authorise—

  (1)the making of provision for the purposes of corporation tax, capital allowances, stamp duty and stamp duty reserve tax,

  (2)the making of provision in connection with the responsibilities of the Nuclear Decommissioning Authority (as established under the Act) for—

  (a)requirements for payments to be made to the Secretary of State, and

  (b)the levying bf charges by the Nuclear Decommissioning Authority,

  (3)the transfer of property and rights to the Secretary of State or the Nuclear Decommissioning Authority,

  (4)the making of payments under the Act to the Nuclear Decommissioning Authority in connection with benefits received in respect of the use or disposal of interests or rights in installations, sites and facilities,

  (5)the imposition, by virtue of the Act, of charges under licences issued under the Electricity Act 1989 or the Gas Act 1986,

  (6)the levying of charges under the Act in connection with powers and duties conferred or imposed on the Secretary of State by or under the Act or other enactments or provisions of Community instruments, and

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  (7)the payment of sums into the Consolidated Fund.—[Charlotte Atkins.]

  Question agreed to.

  EUROPEAN COMMUNITY DOCUMENTS
  Motion made, and Question put forthwith, pursuant to Standing Order No. 119(9) (European Standing Committees),
  EUROPEAN COMMUNITY DOCUMENTS

    DOHA DEVELOPMENT AGENDA
    That this House takes note of European Document No. 15529/03. Commission Communication 'Reviving the Doha Development Agenda negotiations—the European Union's Perspective'; welcomes the European Commission's commitment to the successful conclusion of the negotiations and urges the European Commission to show leadership in taking this forward; welcomes the signs of the European Commission's flexibility, particularly on the Singapore issues, and urges other World Trade Organisation members to do likewise; and supports the Government's aim of ensuring that the negotiations deliver benefits for all countries, especially the world's poorest, recognising the contribution this could make to the achievement of the Millennium Development Goals.—[Mr. Kemp.]
    Question agreed to.

    ADJOURNMENT (WHITSUN)
    Motion made, and Question put forthwith, pursuant to Standing Order No.25 (Periodic adjournments),
    That this House, art its rising on Thursday 27th May, do adjourn till Monday 7th June 2004.—[Mr. Kemp.]
    Question agreed to.

    Ordered,
    That Mr Michael Jabez Foster be discharged from the Committee on Standards and Privileges.—[Mr. Bob Ainsworth.]

  Treasury Policy (Housing)
  Motion made, and Question proposed That this House do now adjourn.—[Mr. Bob Ainsworth]
  10 pm
  Andrew George: I am pleased to secure the opportunity to discuss Treasury policy in respect of housing, partly because the issue has a significant impact on my constituency, which covers west Cornwall and the Isles of Scilly, and partly because I am certain that it also has a significant impact on many constituencies throughout the country.
  I am pleased to see the Economic Secretary to the Treasury in his place. I have tried before, in Budget and other debates in which I have had the opportunity to speak about Treasury matters, to catch your eye, Mr. Deputy Speaker, or that of one of your colleagues, to discuss this matter, but without success. I am pleased to have the opportunity now to debate serious material issues, which I hope the Minister will accept I am raising in a spirit of constructive engagement.
  Following the theme of constructive engagement, a few years ago, after I was first elected, I raised the subject of the impact that council tax discounts were having on second home ownership in my constituency and in many others. I argued at tie time that I was disappointed that a Labour Government had been responsible for giving me such complacent ministerial replies on the subject, both written and otherwise.
  I am pleased to say that on 9 February 2000, in a debate that I had called on second homes and council tax, the then Under-Secretary of State for the Environment, Transport and the Regions, the hon. Member for Sunderland, South (Mr. Mullin), who is now a Foreign Office Minister, acknowledged that I had received a rather complacent response from his ministerial colleagues in previous years and months, and then went on to say:

  "indeed, I have here a rather complacent response, which I will not read out."—[Official Report, 9 February 2000; Vol. 344. c. 12WH.]

  Indeed, he suggested that we discuss the matter later, and we did.
  Later that year, in November, the Government proposed to withdraw the council tax discount for second home owners. I was pleased with that outcome, and I was also pleased when, this year, the Government honoured their promise to reduce that discount from 50 per cent. to 10 per cent. That was the result of constructive engagement. I would like the Government to go even further, but what has happened already demonstrates that constructive dialogue can result in what I consider to be a beneficial outcome.
  I want to raise with the Minister an issue that was rather hidden away in Treasury papers following the pre-Budget statement in early December last year—the subject of self-invested personal pensions. I shall make a few remarks about the Kate Barker review, and then, as I cannot hand it to him across the Floor of the House, I would like to draw the hon. Gentleman's attention to a briefing from the National Housing Federation outlining its concern about various tax impacts on social landlords.
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  What I, and other people far more expert than I who work in the industry, are concerned about is the likely impact of the Government's proposed changes to self-invested personal pensions from April 2005. What concerns me is that, having largely closed one tax loophole by removing the council tax discount for second homes, the Government are about to open a new one that could provide even greater encouragement to those wanting to invest in second homes. From April 2005, self-invested personal pensions will enable a pension plan to invest in residential property for the first time. That will have clear implications: 40 per cent. tax relief on money used to purchase property, and exemption from capital gains tax on the sale of property where the proceeds are reinvested in the pension plan.
  Although personal use of the asset held by a pension fund will be subject to a tax charge, we all understand—just as local authorities understand—the distinction between council tax and business rates on second homes. Frankly, local authorities are prepared to turn a blind eye to businesses that let out second homes for more than 120 nights a year and that would otherwise be subject to business rates. Similarly, it will be very difficult to police the extent to which second homes are used by those with a beneficial interest in the property and the pension plan.
  Mr. Paul Tyler: I am very grateful to my hon. Friend and near neighbour for giving way. In case the Minister does not understand this point—I hope that he does—perhaps my hon. Friend might emphasise that this potential taxpayer subsidy to second home owners will be far greater than the concession on council tax. It will therefore be devastating to Cornwall communities such as those in my constituency and my hon. Friend's. The affordability gap in such communities is already big, and many local people are squeezed out of the market altogether.
  Andrew George: I am grateful to my hon. Friend for that intervention. West Cornwall and the Isles of Scilly have among the highest levels of second home ownership in the country, and parts of North Cornwall have similarly high levels. That is a burden on our local communities, although it is nice that people from outside take an interest in them. None the less, the impact on the opportunities for local people, socially and economically, is very significant.
  I entirely agree with my hon. Friend that this proposal is likely to have a far more dramatic effect. The reduction in the council tax discount was very unlikely to result in the sale or loss of a single second home from any constituency in the country. On the margin, it did not affect people who invested in such properties, who were unlikely to change their minds as a result. It provided more funds for the local community, but it did not necessarily reduce levels of second home ownership.
  Although the proposal makes using self-invested personal pensions for a main home rather complex and probably unattractive, it provides a very encouraging scenario for investing in a second home. In my constituency, 10 per cent. of all the mainland properties are second homes, and 25 per cent. or more on the Isles of Scilly are second or holiday homes. I am not

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  criticising what is a perfectly rational decision, given the way in which the current tax and benefit system works, for someone who has some spare cash. On an individual basis, many second home owners provide a great deal of support to local communities, but they affect the viability of services and housing opportunities for local people. Spare properties in the local market simply are not available for local people.
  Hundreds of millions of pounds have been spent subsidising the wealthy so that they can have second homes in areas such as mine, in which thousands of local people cannot afford their first home. Now, probably billions of pounds in tax concessions will be made available to the wealthy so that they can have their second homes, and even greater numbers of local people will have no chance whatever of owning a first home of their own. That is the problem that we face.
  In areas like mine, the rented sector is diminishing significantly. As the housing market remains buoyant, landlords see their main chance—no one can criticise them for it—as selling their properties into the market. The problem is that local people simply cannot afford to buy into that market themselves. The private sector, where it is not slipping away into the holiday trade, is diminishing and the social rented sector is in any case being lost over time. In an area such as mine, little more than 10 per cent. of rented properties are in the social sector—either housing association or council housing—so the opportunities for local people are few and far between.
  Even in the most run-down communities—there are many of them in west Cornwall—low-priced properties are well out of the reach of those on local wages. The problem is now "ginormous" in my constituency, where there are unprecedented levels of need within the community and long waiting lists in each of the three local authorities that cover it. What impact does the Minister believe the tax change is likely to have in that context?
  On 4 February this year, I asked the Financial Secretary what criteria would be used, and I received a parliamentary answer:

  "There will be no specific criteria relating to residential properties. There will be a single set of simple, flexible investment rules underpinning the simplified regime. The use of private pension scheme assets by a scheme member will be subject to a tax charge."

  We know that. Secondly, when I asked about the likely impact, the Financial Secretary answered:

  "The impact of this change, if introduced, will depend on the extent to which trustees and administrators decide that residential property is a suitable pension investment."—[Official Report, 4 February 2004; Vol. 417, c. 935W.]

  Again, that is more or less self-evident, but the likely impact on the opportunities for local people in areas such as west Cornwall is simply unknown and not addressed at all.
  The hon. Member for Wealden (Charles Hendry) received a written answer from the Financial Secretary on 26 February 2002:

  "Information on the total number of self-invested personal pension plans and value of their funds is not available."—[Official Report, 26 February 2002; Vol. 380, c. 1215W.]

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  How, then, can the Treasury possibly assess the value of the likely impact when it does not even know the number or total value of the plans? Experts in the industry estimate that it could not only have a significant impact on areas such as mine, but bring about a further loss of housing opportunities. I suspect that any such losses for local people on local incomes will be extremely significant. It is also likely to have a general impact on house price inflation in the country, which is already running at a severe rate.
  In the spirit of constructive engagement, I propose an alternative to the Government's approach, as it entails severe unintended consequences. Many pension plans are clearly failing and the Government need to respond. Self-invested personal pension plans are one way of responding, and I applaud the Government for their efforts in that direction. However, unless the Government take a second look at the problem, the policy is likely to have severe and even greater consequences socially throughout the country.
  Why do not the Government try to produce a wider definition of residential properties, which could create a virtuous investment—a benefit for those seeking an alternative to pension plan provision, but restricted to rented or leasehold accommodation for people in local need, or portfolios of shared equity properties, which would provide further opportunities for the most needy or those trying to get a toehold on the housing ladder? If the Government want to proceed, they should define the circumstances in which the investment could take place. That would have two benefits: first, it would benefit pensioners and pension plans; and secondly, it would add to investment in social properties.
  I said that I would mention the Kate Barker review. Recommendation 2 says that local authorities should charge more for second homes, which is going in the opposite direction in respect of statements of investment principles, and recommendation 26 argues effectively for the reintroduction of development land tax. That seems fundamentally to fail to recognise the key feature of the housing market in the past 20 years, which is the persistence and growth of an affordability gap. Areas such as mine need an intermediate market, because there will always be a massive gulf between social rented accommodation and the first step on the housing ladder. Simply building more houses will not fill that gap. The Government need to seek more sophisticated ways of dealing with that.
  The National Federation of Housing Associations sent me a briefing pointing out that the Government are allowing millions of pounds of investment in affordable housing to be lost through onerous burdens on social landlords. Housing associations set up with the purpose of improving former local authority housing face increased tax bills of more than £200 million as a result of recently announced Government reluctance to counter an Inland Revenue decision. The NFHA is asking for relief from capital gains tax, harmonisation of VAT at 5 per cent. on all works to existing social housing, and an extension of zero rating of VAT on aids and adaptation works to non-charitable housing associations, and it is making a case for exemption from stamp duty and corporation tax. To cap it all, it argues for the need for a more effective channel of communication between the Treasury and social housing providers.

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  I hope that the Minister will accept that I wish the debate to be held in a spirit of constructive engagement. I look forward to his response.
  10.16 pm
  The Economic Secretary to the Treasury (John Healey): I congratulate the hon. Member for St. Ives (Andrew George) on securing the debate and on his constructive tone. He wanted constructive engagement, and he certainly delivered his comments in that way. I am glad that he concedes that he is less disappointed with Government policy than he was in the early days after 1997, but I find the title that he has chosen for the debate somewhat curious. He and the House will understand that there is no Treasury policy on housing, only the policy of the Government as a whole. He will also appreciate that, although the Treasury may sometimes help to shape it, we are always fully supportive, to the hilt, of policy. It is therefore about Government rather than Treasury policy that I speak tonight.
  It is nevertheless true that housing is an important factor in the functioning of the economy, and it is therefore a matter in which the Treasury takes a close interest. Housing plays a key part in the flexibility of an economy. The availability of housing, its location and the access that individuals have to it all have a direct impact on a person's ability to gain employment and to match their skills with appropriate job vacancies. People need not only to be able to live within a reasonable distance of their jobs, but to be able to move in order to access better employment opportunities when they arise. Current evidence is that, although increased labour mobility can make a significant contribution to increasing employment, it can make an even greater contribution to increasing productivity.
  Housing also has an impact on a person's social opportunities—through the effects that inadequate or inappropriate housing can have on health, education and social integration. For too long, too many of the poorest in our society have had to endure damp, cold, poorly insulated and poorly repaired properties, which they often cannot afford to heat.
  Despite the obvious importance of housing to our welfare and prosperity, the UK has over many decades persistently under-invested in housing, as the hon. Gentleman hinted. Since 1960, in fact, the UK has invested a lower proportion of national income in housing than any other European Union country. It is partly because of the long-term under-supply of housing that the UK has one of the strongest trends in real house prices in Europe. That upward trend in prices has itself made the desire to get on the housing ladder grow even stronger. Owner-occupation is now the tenure of choice and a source of financial saving for many.
  The hon. Gentleman set out his concerns about affordability within the context of the Cornish economy. It is fair to say that the south-west is a region in which pressures are acute. This afternoon, I looked at some figures produced by the Joseph Rowntree Foundation last year, which show that the south-west suffers the double impact of lower than average incomes and higher than average house prices. In 2002, north Cornwall had a house price to income ratio of more than 5:1 and Penwith, in the hon. Gentleman's constituency, had a ratio of only just under 5:1.
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  In the UK, our high level of mortgage debt is often more reliant on variable interest rates than other countries, which tend to have a higher proportion of debt at fixed interest rates. That greater exposure to variable rates contributes to making the UK housing market more volatile, which itself adds a greater potential volatility to the general economy.
  Since 1997, the Government have faced a unique combination of low investment coupled with high levels of owner-occupation and house-price volatility and sharp regional divergences—not forgetting demographic trends that suggest that the demand for housing will grow ever stronger. In answer to the hon. Gentleman's queries, I shall explain how Labour in government is rising to that challenge.
  Successive spending reviews since 1997 have approved substantive real increases in public sector investment in housing. By next year, it will have more than doubled compared with 1997. After nearly two decades of the Tory neglect of investment, in 1997 the Government inherited a £19 billion backlog of repairs to the social housing stock. Some 2.25 million social homes failed to meet the standard for decent homes. Already, under a Labour Government, 1 million of those homes have been brought up to that standard, and we have an ambitious target to make all social housing decent by 2010.
  Since 1997, the Government have supported the creation of 230,000 new affordable homes. The hon. Gentleman will be aware that the Government have again increased the Housing Corporation's rural target to provide 3,500 affordable homes during 2004–05 and 2005–06 in smaller settlements. We have put policies in place to ensure that existing social housing can be kept for those who cannot rent privately or buy, so that the right to acquire does not apply in rural villages where fewer than 3,000 people live. Restrictions may also be imposed on resale of right-to-buy properties in national parks, areas of outstanding natural beauty and areas designated as rural for that purpose. Those restrictions on resale effectively cover the whole of Cornwall.
  Mr. Tyler: The Minister is making a very reasonable speech, but I hope that he will come to the issue of second homes. I remind him that on the previous occasion to which my hon. Friend the Member for St. Ives (Andrew George) referred, when the then Minister, the hon. Member for Sunderland, South (Mr. Mullin), made a similarly reasonable response, he left the Government a short while later. I warn the Economic Secretary not to be too reasonable, or we will assume that the same fate may befall him. Does he accept that anything that fuels the pressure for second homes makes all the remedial action to which he has referred more expensive for the taxpayer?
  John Healey: I hope that the hon. Gentleman will bear with me long enough for me to reach the point in my remarks when I shall deal directly with the points that he and the hon. Member for St. Ives raised.
  Increased investment alone will not be sufficient. Greater investment must be accompanied by significant reforms if we are both to increase the supply of housing and to promote stability in the wider economy. Fundamental reforms to unlock land and private

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  development are under way. The Planning and Compulsory Purchase Bill contains a wide range of measures designed to improve the speed, predictability and certainty of the planning system. The Government have consulted on an update of guidance on planning for affordable housing. New regional housing boards, introduced by the communities plan, are now taking responsibility for the preparation of regional housing strategies, including the requirement that they are "rural-proofed" with the assistance of the Countryside Agency. The Government are also considering an extension to the contaminated land tax credit to cover long-term derelict land—a measure championed strongly by my hon. Friend the Member for Falmouth and Camborne (Ms Atherton) and which may be of particular benefit to areas of Cornwall.
  We know that we still have further to go, however, and the hon. Gentleman raised three specific points. I shall take his reference to the briefing from the National Federation of Housing Associations as an early representation for the 2005 Budget. I shall deal with self-invested personal pensions and the Barker review.
  Although self-invested personal pensions do not fall directly within my policy field, I submitted a memorandum to the Environmental Audit Committee in February as it had raised the issue with me. The memorandum was published with the Committee's third report on 10 March and both the hon. Members for St. Ives and for North Cornwall (Mr. Tyler) might find it worth examination. It dealt with the pre-Budget proposal to simplify the eight taxation regimes relating to pensions into a single regime, which would among other things allow all pension schemes to invest in residential property. Currently, only large schemes can do so; the prohibition on small and self-invested pension funds was designed to prevent pension scheme assets being put to the private use of the member or his or her family—where the rent forgone would reduce the growth of the pension fund.
  The reforms we propose for SIPPs should help the supply of residential property for rent, but will not exacerbate the problem of second homes about which the hon. Gentlemen are concerned. There will be no new incentive to purchase property for private use, because any non-commercial or personal use of a property would lead to a benefit-in-kind tax charge. There would thus be no incentive to shelter second homes in a pension. The Inland Revenue will police the legislation and will be alert to possible abuses of the kind feared by the hon. Gentlemen. The Inland Revenue will not turn
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  a blind eye to such abuses, even though—as the hon. Member for St. lves suggested—some local councils may do so at present.
  Andrew George: Does the Minister accept that second homes—whether run as a business or simply used as a holiday home—are notoriously difficult to police? When they are let, it is difficult to determine whether their use is commercial or personal. I cannot accept his rather optimistic expectation that the scheme would not be used for second homes.
  John Healey: I understand the hon. Gentleman's concern. I can only repeat that the Inland Revenue is alert to the possibilities. We are obviously looking into the possibilities for misuse, and as the Inland Revenue polices the new legislation and the new regime, it will be alert to potential abuses. It will have access to a range of data that may not be available to the local councils that the hon. Gentleman felt were not undertaking the work required.
  I shall turn briefly to the Barker report. In many ways, the Barker review has prompted a change in the nature of the debate on housing in the UK, putting the affordability of housing to the fore in a way that I think the hon. Gentleman welcomes. Indeed, he expressed some concerns about that in his remarks. Obviously, many factors can influence prices and supply locally, and affordability problems can be further exacerbated in some areas, such as Cornwall, where second homes account for a sizable proportion of the stock—I think that he said that the figure in his constituency was 10 per cent. That is why the Government have given local authorities the power to reduce the council tax discount on second homes, from 50 per cent. to 10 per cent. Councils thus have the chance to raise extra money locally, and can spend it on local priorities. I understand that all district councils in Cornwall have chosen to take advantage of that new power and have agreed with the county council that most of the proceeds will be spent on affordable housing
  The Government recognise that housing is central to the UK's economic performance. We recognise the essential contribution that housing can make—directly and indirectly—to meeting many of our other policy priorities. That is why we are putting so much investment into housing and taking such a close interest in housing policy reform.
  Question put and agreed to.
  Adjourned accordingly at twenty-nine minutes past Ten o'clock.