Harriet Cross MP: speeches

Speeches

• 11 Nov 2024 · Rural Affairs · Hansard source

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  Will the Secretary of State give way?

• 11 Nov 2024 · Rural Affairs · Hansard source

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  Will the Secretary of State tell us where he obtained those figures?

• 11 Nov 2024 · Rural Affairs · Hansard source

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  In my constituency and across the country, family farmers are the custodians of our countryside. For generations, they have contributed to our nation’s food security and land stewardship, provided employment, supported local supply chains, and brought rural communities together. The changes to agricultural property relief—this family farm tax—is the wrong tax aimed at the wrong targets. As we have heard many times, farms, while asset rich, are cash poor. Most farmers do not have hundreds of thousands of pounds of cash available to pay an inheritance tax bill, so they will have to sell the very assets that they use to farm to raise capital.

• 5 Nov 2024 · Flight Cancellations · Hansard source

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  Aberdeen airport is another that struggles with cancelled flights. Over 4% of flights were cancelled last year, which makes it one of the airports with the highest cancellation rates in the country. Does the Minister agree that we must make sure that all our regions in the UK, including Scotland, have a reliable connection, especially to London, for things such as business travel? Linking our rural communities to urban centres is really important, so what can his Government do to make sure that those things improve?

• 4 Nov 2024 · Budget: Implications for Farming Communities · Hansard source

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  The average farm in Aberdeenshire is 490 acres, and average values are about £5,000 an acre for bare land. Once the farmhouse, building machinery and livestock are added, that is suddenly well over the inheritance tax threshold and have a huge IHT bill of hundreds of thousands of pounds coming your way. DEFRA figures show that 19% of farms do not make a profit and 24% make less than £25,000, so does the Minister suggest that farmers sell the land they use to grow the food, sell the machinery they use to harvest the food or sell the buildings they use to store the food, in order to pay this bill?

• 4 Nov 2024 · Income Tax (Charge) · Hansard source

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  If I had time, I would focus on the increase in whisky duty, and the impact on our farmers and small businesses, but I will focus on the oil and gas sector, which is so crucial to the north-east of Scotland and my constituency. As expected, the oil and gas sector was a target for tax in the Budget. I welcome that first year allowances were retained, but other measures were announced that, although well trailed, will severely damage the energy sector. Whether it is increasing the energy profits levy by 3%, which will lead to a 78% tax rate on our oil and gas businesses, extending the windfall tax to 2030 or removing investment allowances, each will compound the investment difficulties facing the sector, and will impact investment and future jobs. The changes to the windfall tax and allowances will see the Treasury receive 83% of cashflow from oil and gas, with companies taking home just 17%. That is the highest share of any Government compared to other comparable offshore mature basins globally. The punitive taxation on our oil and gas sector puts current, real jobs and career opportunities in the north-east of Scotland at risk. Working people, who are the same people with the skills and expertise that we need for our energy transition, are not being protected by the Budget. The windfall tax and the removal of investment allowances also hit homegrown UK-based companies the hardest—the ones that have emerged and grown in north-east Scotland, and the ones that usually have an almost exclusively UK-based workforce. All their profits are subject to the windfall tax because their investments are all in the North sea. That is unlike multinationals, which can buffer the worst impacts of the windfall taxes with their overseas investments, so the changes are mostly hurting our homegrown businesses, which we should all want to protect the most.

• 4 Nov 2024 · Income Tax (Charge) · Hansard source

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  Does my hon. Friend agree that at this time when the world is more dangerous than it has ever been, any reduction in defence spending is the wrong way to go?

• 29 Oct 2024 · Economic Investment and Growth · Hansard source

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  I am not going to ask the Chancellor to pre-empt tomorrow’s Budget, although I might actually have some luck if I did, based on current form. Instead, can she confirm to me that she fully appreciates how important agricultural property relief and business property relief are to the farmers and family businesses that do so much to grow local economies across the country?

• 29 Oct 2024 · Great British Energy Bill · Hansard source

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  I certainly hope that we will have the opportunity to do so, but as I am setting out, the Government’s proposals for the North sea in respect of taxation and cutting down on licences do not guarantee that. As much as I and the hon. Member want and need for that to be the case for our constituents, we cannot guarantee it. That is why it is so important that we get the transition right. The Bill must include consideration of the impact on the public. Communities such as Leylodge and Kintore in my constituency face unprecedented infrastructure pressures. Those communities have seen a 3 GW hydrogen plant, an expanded substation, multiple battery facilities and new pylons. What are their statutory protections? What assurances are there in the Bill that certain communities will not be over-saturated with an unsustainable amount of infrastructure? Before the election, the Labour party claimed that GB Energy would reduce household bills by £300. Since then, Ministers have not repeated the promise and have not explained when or how it will be achieved. I am sure that the Labour Government would not want us to think that that promise was simply a headline-grabbing figure before an election, so I look forward to their clarifying that commitment and voting for our amendments on that figure. Let me move on to the jobs of today and the jobs of tomorrow. We hear that GB Energy will create 650,000 jobs—apparently, 69,000 of them will be in Scotland, which, if delivered, would be welcome—but as is the running theme in this Bill, we do not have sufficient detail to offer even a grain of certainty to comfort those whose jobs are on the line now. Existing oil and gas and supply chain businesses in Aberdeen, Aberdeenshire and the north-east need a timeline so that they can plan their business and workforce. How, when and where will jobs be created? What kind of jobs and skills will be required? Of course, we now have certainty that one job will not be coming to Scotland, as we hear that the CEO will be based in Manchester. Is Aberdeen a headquarters in name but not in nature? We already know that there will be satellite sites in Edinburgh and Glasgow. Which other executive management jobs will not be based in Aberdeen? We in north-east Scotland are not buttoned up the back, so will the Minister confirm today that Aberdeen is still the headquarters for GB Energy—and I mean that in no other way than the meaning that the general public would understand? The funding may not be sufficient, the overall energy strategy is incoherent and there is no clarity on the delivery of jobs or any mention of £300 energy bill savings, but surely the Bill offers certainty to the very industry that will deliver the energy transition. That brings me to the strategic statement. One thing that we know for sure is that we do not know all we need to know about what GB Energy will do. As a result, the uncertainty will continue. For communities such as mine in Gordon and Buchan, and for businesses, supply chains and those working in the existing energy industry, that is profound. We need to know how those communities will be brought with us in the transition—if it is, indeed, to be a just transition. GB Energy will not generate energy, but it cannot instead generate mass redundancies across north-east Scotland. As has been mentioned, the Bill gives the Secretary of State extensive power to dictate what is in the strategic statement, and he has given himself the huge responsibility of ensuring that GB Energy delivers its aims. The work of the existing energy industry, and of communities such as Gordon and Buchan, must be taken into account. If it is not, the transition to cleaner, greener energies will be less efficient, less affordable and less possible. As such, I sincerely ask that the Secretary of State prepares the strategic priorities in a timely manner, taking account of stakeholders in the industry, the impacted communities, the current jobs and skills, and the existing businesses that are the bedrock of our future energy generation. Because the Bill gives us all but no clarity on what is going to happen, the strategic statement—which we are all waiting for—is going to be the key document in dictating whether it will or will not be a success. As I said at the start of my speech, I want it to be a success; I want the UK to be a clean energy superpower, just as we are, and always were, an oil and gas superpower. If we get this right, that superpower status will drive the economy and jobs of the future. We cannot allow investment to be lost, because that means that investment in new technologies will be lost. If we lose the expertise, the supply chains and the private investment because of the way this Bill is handled and how GB Energy is handled—there is no guarantee that private investment will stay in the UK just because GB Energy has been created—we will look back at this time and wish we had done things differently. I really do not want to be in that situation, because it is my communities in Gordon and Buchan and in north-east Scotland who will suffer the most.

• 29 Oct 2024 · Great British Energy Bill · Hansard source

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  There are few areas of the country that are as reliant on, and therefore as vulnerable to, the energy industry as my constituency of Gordon and Buchan and wider north-east Scotland. It is because of this that I want the Government’s energy strategy to be a success. Indeed, my constituents need it to be a success. However, that is why I have severe reservations about the Bill and why I believe that we must view the Great British Energy Bill not in isolation, but alongside the Government’s wider energy strategy. I begin by considering the public money involved—the £8.3 billion of taxpayers’ money going into Great British Energy. Labour has cited international examples, such as France’s EDF, as inspiration for Great British Energy, but let us examine EDF’s recent history, which reads like a cautionary tale of state intervention gone wrong. In 2022, the French Government were forced to fully nationalise EDF, costing €9.7 billion, and in 2023, they had to inject another €13 billion. That huge expenditure of taxpayer money did not even solve EDF’s problems; the company now faces debts exceeding €64 billion. Therefore, is £8.3 billion of investment into Great British Energy realistic? Let us move on to Labour’s wider energy strategy—perhaps there are assurances there that can help mitigate the apparent inadequate funding. Let us not forget that the UK will be using oil and gas for years to come, which is not disputed. The expectation that we should get this from our domestic oil and gas supplies should not be controversial, yet our energy security is being put at risk through the Government’s actions and words. Jobs and investment in Gordon and Buchan and across north-east Scotland are being lost, and a home-grown energy transition is being made ever more difficult. It is incoherent to pump public money into the energy sector, while at the same time scaring away private investment from the very companies that will be vital to the energy transition, whether by announcing that there will be no new North sea licences, extending and increasing the windfall tax or removing investment allowances. Offshore Energies UK has warned that expected tax changes could see investments in UK projects by oil and gas producers fall by about £12 billion by 2029. Last week, Reuters reported that a North sea producer is looking to sell stakes in its North sea assets and relist on the US stock exchange. The same article quoted the chief executive officer of TotalEnergies, who said that his team had halted exploration in the basin, and that: “With this political landscape, even if you find something you’re not sure you can develop it… The situation in the UK is very problematic.” The CEO of Deltic Energy also announced plans to cut spending, telling Reuters: “The clear message from key investors was ‘do not invest in the UK’.” That is just a snapshot, but it puts the Government’s £8.3 billion into context, alongside the other decisions that they are making.

• 29 Oct 2024 · Great British Energy Bill · Hansard source

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  Does the hon. Gentleman therefore appreciate why Conservatives are so concerned that the plans coming forward from the Labour Government will do exactly the same to north-east Scotland if this is not handled properly?

• 29 Oct 2024 · Great British Energy Bill · Hansard source

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  Does the hon. Member appreciate that the issue is not legislating for jobs but the lack of accountability in the Bill?

• 17 Oct 2024 · Business Property Relief and Agricultural Property Relief · Hansard source

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  I would obviously I have to see what the TFA suggested, but I think that we need to look at the agricultural sector as a whole. If land is being taken out of farming for any purpose, it is not going to be available for tenants, so if landowners are feeling compelled to sell their land because they have to cover an IHT bill, it does not matter what happens with reforms down the line; that land will not be available for tenants to access. I fully support the tenanted sector—it is a vital part of our farming sector—but, on its own, it will not be enough to keep land in production. BPR is important for every family business the length and breadth of the country, and therefore in all of our constituencies. Family-owned businesses are the beating heart of the British economy. Across the UK, there are approximately 5.3 million family businesses, employing over 14 million people and contributing £225 billion per annum to the Treasury. BPR is especially vital for small family businesses—including many in my constituency of Gordon and Buchan—which form the backbone of our local economies, providing much needed local employment, stability and resilience in the face of economic and environmental challenges. Businesses that rely on BPR to survive a succession event are often significant local employers, and their failure would have a knock-on effect on local services and on business rates, which are vital for local authorities. Other models of business ownership, such as plcs and those backed by private equity, do not face a tax charge on the change of ownership, so BPR is a vital mechanism to ensure that family businesses—85,000 of which are passed to the next generation each year—are at least on a level playing field. About 77% of family small and medium-sized enterprises are first-generation businesses. Without BPR, these family firms would lose the opportunity to grow and transition into successful next-generation businesses. If, following a succession event, businesses effectively have to take a 40% hit on their finances or asset base to cover an IHT bill, what chance is there for them to secure longevity and flourish in the future? As we approach the Budget, I hope the Minister and his Government will take on board that APR and BPR are vital to the long-term planning and investment of rural areas and family businesses. It is not an overstatement to say that the future of rural communities and our food security depend on it. In particular, the Government should focus on four things: providing clarity and reassurance on their intentions regarding APR and BPR; committing to maintaining those reliefs in their current form for at least the duration of this Parliament; commissioning an independent review on the wider economic and social impact of those reliefs beyond just the direct cost to the Treasury; and engaging meaningfully with rural communities, farmers and family business owners before pursuing any future changes. APR and BPR are not mere tax reliefs; they are the foundation of a thriving, sustainable and entrepreneurial United Kingdom. They support our farmers and family businesses, pillars of our communities that have been there for generations. They ensure that businesses can continue to operate following a succession event and allow for the long-term planning necessary for farms and family businesses to develop and thrive. I look forward to hearing Members’ contributions.

• 17 Oct 2024 · Business Property Relief and Agricultural Property Relief · Hansard source

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  I am grateful for the opportunity to wind up this debate, and I thank all right hon. and hon. Members for their contributions and the Minister for his closing remarks. A constant theme of today’s debate has been the importance of family businesses and family farms and the vital role they play in our rural economy. As the right hon. Member for Orkney and Shetland (Mr Carmichael) rightly said and, of course, knows well from his ultra-rural island constituency and communities, the interconnection between farms and other local businesses cannot be denied. Any impact on farming impacts everything else, whether that is marts, vets or suppliers—the knock-on effects are endless. I fully agree with my hon. Friend the Member for Chester South and Eddisbury (Aphra Brandreth), and echo her words about the Government’s commitment to not increase taxes on working people. If farmers and family businesses are not the pure definition of “working people”, I really do not know what is. Similarly, I welcome the comments of the hon. Member for Hexham (Joe Morris) about the need for cross-party working on this issue; as we all strive to secure a stable rural environment for the economy and employment, that is really important. We should absolutely work on a cross-party basis as we go forward. Farms and businesses must adapt and innovate to survive across generations. As the hon. Member for Strangford (Jim Shannon) correctly identified, the ability of farms and family businesses to do so will be severely hampered by changes to APR and BPR—they must be able to survive across generations, as well as during single generations. Put very simply, people need cash in order to pay a tax bill, and they need a lot of cash to pay a very large tax bill. As my hon. Friend the Member for Central Suffolk and North Ipswich (Patrick Spencer) put it so succinctly, asking many farmers and family businesses to pay a tax bill from an illiquid asset is very difficult: they do not have liquid to play with. As I said, I thank the Minister for his response. I appreciate that we are less than two weeks out from the Budget, and therefore he is completely unable to confirm or deny rumours, but I hope the concerns that have been raised today have been heard and will be considered in good faith, because they are not just the concerns of people in this Chamber. They are the concerns of our constituents—of farmers and small and family businesses the length and breadth of the country. The Minister pointed out that the cost of BPR has risen to £1.3 billion, but that compares very favourably with the £225 billion of tax income that family businesses contribute to the Exchequer each year. I will conclude by reiterating my calls for clarity on this matter, maintenance of these reliefs, and meaningful engagement with affected communities on any such matters going forward. Today’s contributions have strengthened the case for action in this area: our rural communities, family businesses, food security and stewardship of our countryside all depend on the certainty that those reliefs provide. I thank all Members for their contributions to today’s important debate. Question put and agreed to. Resolved, That this House has considered Business Property Relief and Agricultural Property Relief.

• 17 Oct 2024 · Business Property Relief and Agricultural Property Relief · Hansard source

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  I beg to move, That this House has considered Business Property Relief and Agricultural Property Relief. I rise today to address a pressing issue affecting not only my constituents in Gordon and Buchan but rural communities and family-run businesses across the entirety of the United Kingdom. As we approach the autumn Budget, there is growing anxiety, yet to be put to bed, among farmers and family business owners about the potential changes to agricultural and business property reliefs. APR and BPR play a crucial role in securing the longevity of farming and family businesses. Without inheritance tax reliefs, the value of an individual’s business assets will be chargeable at a full 40%. The rate of inheritance tax in the UK kicks in at a relatively low value in relation to the value of farming assets, even for a small farm, particularly when compared with that of other countries. There is speculation in the media, coupled with Government silence, on the future of these reliefs, which is causing profound problems. In a meeting with the Country Land and Business Association just yesterday, I heard how some of their members are already taking rash and rushed decisions because of this matter, which will impact their businesses, tax position and operations for years to come. Its members—our constituents—fear the worst in terms of changes to APR and BPR in the Budget and the profound impact that may have on their businesses, which, in many cases, provide employment for their families and wider communities, and have done so for generations. APR and BPR are not, as some would have us believe, just tax loopholes for the wealthy. Viewing those reliefs as fair game in a Budget shows a complete lack of understanding of their importance and function. APR and BPR are lifelines for hard-working family farms and entrepreneurs, who form the backbone of our rural communities and local economies the length of the country. These are same businesses that we MPs are always too delighted to be seen to visit and champion as pillars of our communities and for their hard-working, entrepreneurial spirit; it is now time that we put those words into actions. Many of these businesses would not survive a succession event without APR or BPR—it is that simple. There is a reason why the reliefs have been in place for almost 50 years, which is that they work and are needed. Without them, farming and family businesses would change, and the UK’s rural business landscape would be unrecognisable. Agricultural businesses are vital for not only economic activity but food production and security, land stewardship and environmental management. As farmers face ever-tighter margins from increased environmental obligations, spiking input costs and global market pressures, there is already considerable strain on farming profitability. It is important to understand that although farms have high asset values, they are often cash poor. In 2022-23, across all types of farms, 17% were failing to make a profit and 59% were taking home less than £50,000. Even where a profit is made, it is usually directly reinvested back into the farm—the business—in order to increase efficiency, develop or adapt. Cash does not simply sit idly; it is usually invested into assets needed to grow the farm and allow it to function, be it via land, buildings or kit. APR is also vital for ensuring that farms can be passed to the next generation without a crippling inheritance tax bill. The continuity of family farms is necessary for the maintenance of our cultural heritage and expertise and, crucially, generational stewardship of our countryside and responsibility for food production. Without APR, many families would be forced to sell their land or buildings or even split up the farm in order to pay inheritance tax bills, which, even for the most modest of farms, could be hundreds of thousands of pounds, if not in the millions. That would mean selling the very assets and losing the scale needed to operate and produce food, fundamentally undermining the viability of those businesses. It is important to appreciate that farms do not operate in isolation; they typically engage with multiple businesses in close proximity to their holdings. In my recent meeting with the National Farmers Union Scotland, I was told about a farm in north-east Scotland that engages with no fewer than 92 separate businesses within a radius of just a few miles; those businesses all benefit from that one farm. The closure of a single farm will have a ripple effect throughout any local economy. The average age of a farmer in the UK is 59, and 35% of farmers are aged over 65. We all know that it is common to see farmers still managing their holdings well into their seventh or eighth decades, but that means that, on family farms, a succession event—planned or otherwise—can hit very suddenly. Without the reliefs, we risk losing a generation of farmers, threatening the future of British agriculture. Many family businesses will simply cease to exist if they are removed. The impact will extend not just to landowners, but far beyond, to tenancies and the wider rural economy. In a recent poll by the CLA of over 500 landowners and farmers, 86% said they were likely to have to sell some or all of their land upon a death if inheritance tax reliefs were scrapped, and 90% said that the UK’s food security would be damaged in the long run. I find that really hard to disagree with. The potential loss of productive agricultural land and farmland has serious implications for our national food security, and I remind the Minister of the line in the Labour manifesto, that “food security is national security.” Let us also consider the alternative: if large areas of land were sold to cover an IHT bill, who would be likely to buy that land? Would it be another farmer, who would also have to manage their own capital in light of their own family’s IHT bill down the line, or a large corporate company, where boardrooms and bottom lines dictate the approach to environmental management, room for nature and food production? I do not think that that is the ownership and business structure of rural Britain that this Government, or indeed any of us, are striving for. We must also consider the impact on tenants as well as landowning farmers. Any changes to APR that make it less appealing for a tenancy to be created will have a detrimental impact on tenants, the tenancy sector and the next generation of farmers.

• 15 Oct 2024 · Great British Energy Bill (Fifth sitting) · Hansard source

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  I understand that in some constituencies this might not seem to be an issue, but in the north-east of Scotland it is a massive issue. For example, I have a town in my constituency called Kintore, which is next to a place called Leylodge. It is getting a 3 GW hydrogen plant next to an extended substation, with at least four or five battery plants and all the new pylons coming in to feed that. If the residents of Leylodge, where there are about 40 houses, and Kintore, where they number around 4,500—and similarly those in New Deer, up in the north—do not feel under siege, how do they feel?

• 10 Oct 2024 · Great British Energy Bill (Fourth sitting) · Hansard source

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  The second part of the amendment states that the jobs should be created by 2030. That timescale is really important, because it ensures that the expertise we have now can be retained to help build these jobs of the future. Even if the Government will not commit to the figure, will they look at the timescale, which will give the industry certainty?

• 10 Oct 2024 · Great British Energy Bill (Fourth sitting) · Hansard source

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  Does my hon. Friend agree that the supply chains that we have are used to delivering large-scale multimillion-pound projects? That is important not only for home-grown jobs, but for the success of GB Energy and any infrastructure and skills that will come out of it. We need our home-grown supply chain, which is world renowned, to help deliver this.

• 10 Oct 2024 · Great British Energy Bill (Third sitting) · Hansard source

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  Does the Minister appreciate that although in the run-up to the election it was assumed, or said, quite often that GB Energy would save households £300, that figure seems now to have been dropped? Is this not a mechanism to ensure that low-income households see some benefit from the Bill? They will not necessarily take the Government’s word for it that it may come later, when we have already seen announcements such as the figure of £300 being dropped.

• 10 Oct 2024 · Great British Energy Bill (Third sitting) · Hansard source

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  Just for clarity, will the other changes that Labour is bringing in, such as ending North sea licences, increasing and extending the windfall tax and ending investment allowances, make us more or less secure in the meantime, before GB Energy is set up? Will they expose us more or less to the international market?

• 10 Oct 2024 · Great British Energy Bill (Third sitting) · Hansard source

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  We have already discussed the financial assistance in the Bill. It is therefore anticipated that there may be financial strain. Given that the objects in the Bill do not include reducing bills, what guarantee is there that reducing bills will be a priority if and when finances become tight?

• 8 Oct 2024 · Great British Energy Bill (Second sitting) · Hansard source

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  Q The Bill, as we have discussed, is pretty light on detail at the moment, which means it could be all things to all people or not offer enough answers to give any reassurance to anyone. From your clients’ point of view, is there a different mechanism that they would prefer? How could this public investment be used in a different manner to actually help drive and retain the private investment coming in at the moment? In other words, is this the best mechanism for keeping and driving investment? Josh Buckland : On the surface, a range of different countries have publicly owned energy companies of different sizes and scales. Therefore, I do not agree with the concept that private investors are either unfamiliar or concerned at a general level. It will all come down to your point around the design of the actual institution and how it operates with the private market. I think you are right to say that the Bill is relatively high-level. Looking back at some of the precedents that exist, I would mention the Green Investment Bank again. That was operational for a number of years and was established and grown while the legislation was then taken later down the line. It was easier, if you were a private investor, to understand the role that the Green Investment Bank would play and then have the legislation to effectively inform and solidify that. The challenge in this context is that the Government have obviously proceeded with the legislation early on, as the institution is being established. That does not mean to say that it cannot be created as an institution that is independent and galvanises private investment but, clearly, the current level of uncertainty around the design and the mechanisms that it will deploy will add to that challenge. Therefore, the Government have said that alongside the Bill they will look to publish more detail on a framework agreement with Government, and how they will set that out and consult with private industry. That, in tandem with the Bill, is critical at this formation stage. That is not to say that it necessarily leads to all that detail being in the Bill itself, but it is critical that it goes alongside it.

• 8 Oct 2024 · Great British Energy Bill (Second sitting) · Hansard source

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  Q The statement of strategic priorities set out in clause 5 does not have a timescale on it. I wonder how important it is from your members’ points of view that that timescale is narrowed down, particularly given that a lot of your members will be international companies. Obviously investment and personnel—that is, skills—flow abroad, and we cannot guarantee that they will wait for a strategic priorities document to come forward. David Whitehouse: There is no doubt that the UK and Scotland are in a global race for investment, and we need to create an environment where we are attracting investment. I sit in a sector that has been battered to some degree by public perception and by tax changes. There are things that are happening outwith GB Energy that, as a country, we need to look at. We need to make a great environment for investment. Time does matter; GB Energy will start to come to life when the Secretary of State puts forward priorities. The thing that we would ask—I think you have heard it from others—is about bringing forward the strategic priorities for GB Energy. The statement should be something that we are engaged in and are bringing forward now. It should come forward in a timely manner, but it must make sure that it has taken on board the necessary engagement with industry, Governments and other key stakeholders. Time is always of the essence.

• 8 Oct 2024 · Great British Energy Bill (Second sitting) · Hansard source

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  Q The aim of GB Energy, among other things, is to decarbonise the grid. The 2030 date has been thrown around. Practically, in terms of timescales, no matter what happens with GB Energy, the Crown Estate and land leases, it would not impact the Crown Estate’s ability to bring more wind farms online by 2030. What is in the Bill at the moment that can bring on the transition and help to decarbonise? Dan Labbad: If you look at where we are today, we have just under 12 GW generating. The Crown Estate in England, Wales and Northern Ireland has about 42 GW in the pipeline. The first thing is: how can we bring as much of that to generating as possible? That is really important. Where and how do we remove immediate encumbrances? That is something we can work on immediately. From there, even to bring 20 GW to 30 GW to market by 2030 needs a lot of work and co-ordination. To put it another way, we have delivered 12 GW of generating capacity in 25 years and if, as informed by the Climate Change Committee, we are to move up to 125 GW of generating capacity by 2050, that means we need a five to tenfold increase in the next 25 years. What we do in the next few years is incredibly important to ensure that we are laying the foundations for that to be a successful deployment.

• 8 Oct 2024 · Great British Energy Bill (Second sitting) · Hansard source

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  Q We have heard from various witnesses, particularly Ravi Gurumurthy, about the risk management of private investment and how that will sort of coincide within GB Energy. I am just wondering how the Bill is expected to ensure that GB Energy does not just effectively end up as a sink for risky investments, or is that okay? Is the prospect for GB Energy that it provides that full buffer? If not, how will we prevent that situation? Otherwise, we are effectively just making taxpayers’ money the risk management for private investment. I do not have a “yes or no, which side of that fence do I sit on?” answer; I am just wondering what is acceptable within the context of the Bill. Michael Shanks: That is a really fair question. The question of risk appetite is important; that is partly why setting up GB Energy as a company, regulated by the Companies Act and with a fiduciary board made up of financial experts who have a responsibility as a board of directors for the direction of the company and for its financial results, is so important. There has to be some risk appetite, and one of the earlier witnesses made a point that I would agree with—if there are absolutely no projects that do not have any risk at all, GB Energy is not really filling the gap. It is really important that GB Energy can move in the spaces where the current investors are not necessarily finding those opportunities. Crucially, however, GB Energy is obviously owned by the taxpayer and therefore, as a backstop, there is a real conviction that it will only invest in things that have a likelihood of producing a return for the taxpayer. Of course, when we get into making individual decisions, that is partly why it is important the Bill does not go into a granular level of detail on every single thing that GB Energy will do, because it is really important that we give that board, those experts and everyone they bring in to advise them, the space to move into opportunities as they emerge. If we were to go back five or 10 years, we would not have thought that we were about to have the world’s biggest floating offshore wind farm off the coast of the UK. That would not be on the face of a Bill like this, but actually it is a huge potential opportunity for us and we would like those kinds of opportunities to be open to GB Energy to explore.