Energy Prices – Severn Barrage

Mr Peter Hain (Neath) (Lab): I thank the Secretary of State for his revelation that The Sun is now the house journal of the Liberal Democrats. It does him and the Government no credit that their attitude to Labour’s price freeze has veered wildly, initially denouncing it as Marxist, which was a revelation to all Marxist disciples, and now misrepresenting it with a patronising approach that belies the fact that my right hon. Friend the Member for Don Valley (Caroline Flint) and the leader of the Labour party have been proved right all along on this policy, as they will be proved right in the future.

One of the best vehicles for keeping energy prices low is the Severn barrage. This huge infrastructure investment boost makes the Severn barrage a no brainer, not least because it requires no Treasury funding. The £25 billion construction cost will be financed entirely privately, mainly from sovereign wealth funds and other large-scale institutional investors, because they would have a guaranteed revenue stream over a period of 120 years or more. The project will create 20,000 jobs during its nine-year build, and with multiplier effects another 30,000 jobs, making a total of 50,000 jobs and a £70 billion boost to the economy. Many of the jobs will be located in communities in south Wales and the south-west of England, which are crying out for such a boost of investment and high-skilled jobs. Some 80% of the spend will be in the United Kingdom, unlike wind power where 80% is spent abroad because countries such as Germany and Norway have stolen the lead on wind turbine manufacture.

The scheme would harness one of the world’s largest potential sources of renewable energy: the huge tidal range of the Severn estuary—the second highest in the world. Building an 18-kilometre barrage between Brean in England and Lavernock Point in Wales would be one of the world’s largest privately funded global engineering projects.

Madam Deputy Speaker (Dame Dawn Primarolo): Order. I must reluctantly intervene on the right hon. Gentleman. This debate is about energy prices, not energy generation from things like the barrage. He needs to relate his comments to the impact on energy prices and passing on reductions to the consumer.

Mr Hain: I was about to do that, but I need—obviously with your permission, Madam Deputy Speaker—to describe the project in order to do so.

Most importantly, the barrage would produce the cheapest electricity in the United Kingdom—half the cost of alternative sources such as gas, nuclear and coal, as well as other renewables. Previous consortia interested in the project have looked to a period of consumer subsidy lasting less than 25% of its life—very small compared with other renewables. After that initial subsidy period, promoted by previous consortia backing the barrage, it would generate electricity at £20 per MWh for at least a century, less than half the wholesale market price that the economy has been used to.

The latest project backer does not want the consumer subsidy of contracts for difference, a point which I hope the Secretary of State will note. In meetings with him, I have discussed support for the barrage, which he has not been able to give. The barrage has attracted widespread criticism from wildlife groups, but it has considerable other benefits, including low electricity prices over its entire life if the current project is taken forward in this way. In addition, it would have other important effects on the economy. The 1,026 turbines required, each the weight of a jumbo jet, would be built at two factories in the region, most probably at Port Talbot and Bristol. The planned caisson-casting yard at Port Talbot deep-water docks could afterwards be converted into a port for ultra-large container ships. It would also enable us not just to keep prices low, but to export the technology and expertise in tidal barrage construction around the world. So it would keep prices low, which consumers desperately need, and it would support flood protection. Some 90,000 properties and 500 square kilometres of Wales and the south-west, including the Somerset levels, would be supported, and it would act as a barrier against storm surges. Therefore, prices would be kept low and there would be many other benefits from the project.

In conclusion, this is the biggest single investment project coming from the private sector, needing no consumer subsidy at all in contracts for difference, according to the latest backer of the project, which I hope the Government will meet. I hope that people will see this as something that should have been backed already, and that now all parties will back it as a—

Madam Deputy Speaker: Order.

Stormont Agreement

Mr Peter Hain (Neath) (Lab): I congratulate the Secretary of State and all the party leaders on reaching an agreement, not least in view of the Prime Minister’s astonishingly premature exit from the previous summit, and his lack of engagement, which has been greater than that of any Prime Minister for more than 20 years. How can the Secretary of State be sure that this process will not long-grass the key flashpoint issues of parade and flags? On corporation tax, is she aware of Sir David Varney’s 2007 report to the Treasury, which showed that 95% of businesses in Northern Ireland do not pay corporation tax? That is not a silver bullet; it will leave a £300 million hole, or 3%, in the block grant, if there is equalisation with the Republic of Ireland.

Mrs Villiers: I assure the right hon. Gentleman that the Prime Minister has been closely engaged with this process, and the visit he made along with the Taoiseach was significant in moving things forward. The financial package that he was able to agree with the Treasury was a crucial part of our progress. This Government have delivered significant achievements on some of the most difficult issues that Northern Ireland faces, and that is in large part due to work done by the Prime Minister.

I have acknowledged that there is more work to be done on the difficult issues of parades and flags, and no one would say for a moment that this agreement is the last word. I will be working, as will my officials and colleagues in government, to find a way forward on those matters, and ensure that they are not long-grassed and that we make real progress. As the right hon. Gentleman pointed out, those issues can cause huge disruption in Northern Ireland and poison the political relationships that are crucial to making the Executive work effectively. He says that corporation tax devolution is not a silver bullet. I agree that on its own it will not transform the Northern Ireland economy, but combined with other economic reform, a focus on skills and competitiveness, and economic reform across the board, it can have a significant and transformative effect. That is why I am disappointed that Labour is not supporting it.

UK Ebola Preparedness

Mr Peter Hain (Neath) (Lab): Has the Secretary of State had the chance to consult the British Medical Journal editorial of 13 October, which insisted—more than two months ago—that the Government’s airport screening policy for Ebola was illogical? I spoke to the author yesterday and he argues that we have missed the one case to have been imported while thousands, many at low risk, have been delayed, detained and made to fill in a form just because they have been to west Africa. Experts such as the author insist that what the Government should have been doing is ensuring that all those at risk, especially health workers such as Pauline, know exactly what to do if they start to feel unwell. Might it be sensible to keep health workers away from direct patient contact for 21 days after they return?

Mr Hunt: Perhaps I can reassure the right hon. Gentleman on that point. Health care workers are kept away from direct patient work for that incubation period, so that protocol has been put in place. The BMJ article to which he refers is based, I think, on the misunderstanding that screening is the same as testing. The reality is that the tests for Ebola show up only when the virus has reached a certain level, at which point the patient will have become feverish and started displaying symptoms. So testing before that point is a waste of time. The purpose of the screening process is to identify those at highest risk so that we can make sure that they are actively monitored when they go home and that they know exactly what to do if they do develop symptoms. That is exactly what happened with Pauline Cafferkey.

All Party Talks Northern Ireland

Mr Peter Hain (Neath) (Lab): May I offer a critical observation, not for some partisan motive, but out of experience of negotiating at such summits alongside Tony Blair, when he was Prime Minister? I was both troubled and astonished that the current Prime Minister left the summit prematurely in the way that he did. My experience is that any Prime Minister has to coax and progress the discussions and negotiations, and there is a chemistry about those and a momentum that it is possible to develop. Walking away as he did leaves a kind of political paralysis which I suspect and fear may continue. That is extremely damaging and I am extremely worried about the situation.

Mrs Villiers: I can provide the right hon. Gentleman with reassurance that the Prime Minister has not walked away; he continues to follow these matters with the greatest of attention, because he cares about Northern Ireland and wishes to see a successful conclusion to this process. The reality is that both he and the Taoiseach made a realistic assessment on Friday morning that the parties were still far apart on a number of issues, and there was an indication that on some key issues some parties were simply not prepared to move. In particular, it was very difficult to see that Sinn Fein was prepared to move on matters relating to welfare reform.

Average Weekly Earnings

Mr Peter Hain (Neath) (Lab): But does not the Tories’ much trumpeted economic plan mean depressed earnings in Wales, generating lower taxes, and Government borrowing overshooting Labour’s planned target by more than £20 billion—the very deficit target luridly denounced by the Tories, who said it would bankrupt the country? Why does not the Minister apologise for this abysmal failure in the Government’s austerity strategy?

Alun Cairns: As the right hon. Gentleman was part of the previous Government, he should apologise for leaving Wales the poorest part of the United Kingdom. He should further apologise for the fact that wages fell at the sharpest rate between 2008 and 2009. The Government’s long-term economic plan is working for Wales, and wages are rising quicker in Wales than across the rest of the United Kingdom.