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New Nuclear Power Stations

It is a great pleasure and privilege to serve under your chairmanship, Mr Streeter. I thank my hon. Friend the Member for Bridgwater and West Somerset (Mr Liddell-Grainger) for securing the debate and leading it with his normal approach of combining passion, vigour, commitment and enthusiasm with addressing the issues directly. He is absolutely right that this is a long-term decision, and we must see it in that context. Our decisions on nuclear will be some of the most important taken on energy policy by this Government. We therefore attach great importance to how those decisions are made and realise that they must pass the test of time. My hon. Friend is also right to remind us that we are discussing national issues. A development such as Hinkley is of national significance, and it will play an important role in our future electricity generation, if it goes ahead. I totally accept the background to his argument. He raised several issues during his speech that do not relate directly to the work of my Department. I am pleased that he is meeting the Secretary of State this afternoon to discuss Building Schools for the Future and I will be interested to know the outcome. However, I am keen to set out clearly the approach of my Department and the Government to the building of new nuclear. We set out a clear plan for nuclear in the coalition agreement. We are committed to allowing the construction of new nuclear plants, subject to the normal planning process for major projects and the fact that they should be without public subsidy. We will continue to take forward the national policy statement and the process through Parliament. New nuclear has a clear role in the energy mix, but we are certainly alive to many people's concerns about the costs of such activities, so we are absolutely clear that there should be no public subsidy. In that respect, our position is broadly the same as the previous Government's. It is for private sector energy companies to construct, operate and decommission plants, but it is for the Government to ensure that there is appropriate safety, security and environmental regulation. We will ensure that the taxpayer is protected now and in the future from such costs. Operators will be required by law from the outset to set aside money to pay for long-term waste management costs. Having considered various possible subsidy issues, we will ensure that the taxpayer is protected. I am encouraged that despite those restrictions, which are some of the toughest in the world, Britain is nevertheless the most exciting place in Europe—perhaps in the world—for the construction of new nuclear plants. Many companies are keen to invest on that basis. We are also committed to removing barriers to investment. The work of the Office for Nuclear Development has been fundamental to that, as has the nuclear development forum, which considers how to address the practical issues that can present challenges. On that basis, we will drive forward work on planning, regulatory justification, the generic design assessment and waste and decommissioning financing arrangements. The Government are required to undertake regulatory justification. We will take a decision after we have finished considering responses to the recent public consultation on how best to proceed. On waste and decommissioning financing, we must redouble our efforts to deliver a framework for dealing with the costs that protects the taxpayer and provides both taxpayers and operators with clarity. The consultations on the fixed unit price and waste handling regulations have closed. We are now considering our responses carefully and will respond in due course. I know that, to the companies proposing plans for reactor designs, the process for the generic design assessment is fundamental. I am encouraged by the nuclear installations inspectorate's recent comments that it is on course to conclude by June 2011. The Environment Agency is consulting on its preliminary findings. We have also indicated that there needs to be reform of the nuclear regulator, which must be structured and equipped to meet current and future challenges. In its role as a nuclear regulator, the Health and Safety Executive has responded to those challenges, but I am persuaded that reform is needed to meet the specific challenges of the sector. I want an effective, efficient and independent nuclear regulator to ensure that we have transparency and accountability. Those are some of the big national issues that we have to take into account as we consider how the programme moves forward. I want to pick up on my hon. Friend's concerns about the planning system. We have said that we are determined to reform the planning system. The changes made by the previous Government addressed some of the issues about the speed of the process, which they were right to identify, as applications and considerations could sometimes go on for years. They put in place a process to deal with that, but it did not have democratic accountability. We have decided that national policy statements should continue to be an integral part of the process, but that they will be subject to a substantive vote in Parliament. That will give national policy statements greater democratic legitimacy and reduce the risk of judicial review. Following the consultation on the national policy statements, we were required to take account of the public meetings and the thousands of submissions that were received, which we are currently considering. I assure my hon. Friend that we will set out our further consideration on the NPSs as soon as we can, because we understand how significant the matter is to all those involved in the sector. My hon. Friend also correctly identified the changes that we intend to make to the Infrastructure Planning Commission. Again, we thought that that organisation lacked democratic legitimacy. The changes will mean that the back-office function and the analytical work carried out on individual applications will be done by a dedicated unit—the major infrastructure planning unit—which will come under the Planning Inspectorate. Instead of the unit's recommendations going to a competent but, nevertheless, unelected quango, its recommendations will go to the Secretary of State. For those who are concerned about the time scales, I can give a clear assurance that there will be an obligation on the Secretary of State to make a decision within the same time scale under which the IPC would have proceeded, so there will be no delays. Critically, an application under the transitional arrangements will continue under the same jurisdiction in which it started. There is no risk that an application made under the current system will have to be started again from scratch when the changes come into place. We want to make sure that people who are investing know there will be certainty about the time scale in which the process will move forward. My hon. Friend also talked about business rates. It is proper to debate the wider issue of whether allowing some business rates and new business activities generally to be kept locally is a good way of encouraging local authorities to stimulate business activities in their areas. On energy issues—this picks up on the final part of his speech—we have said that we are keen to build a new relationship between energy installations and the communities that host them. If a community is hosting something such as a wind farm on behalf of the wider interest and not purely for the benefit of that community, it is reasonable to find ways of recognising that. We want to find new ways of achieving shared ownership so that direct funding returns come into a local community. We also want to consider how the business rates that become payable as a result of that development can be maintained locally for the first few years. We are in discussions with our colleagues in the Department for Communities and Local Government to see how broadly based that approach can be, because if that same approach were to be applied to a nuclear power facility, as my hon. Friend said, many tens of millions of pounds would come into the local community, which would make a significant contribution towards the infrastructure and educational changes that might be necessary. I am holding continuing discussions with my colleagues in the DCLG on that basis, and we understand the need for early clarity. On the specific application at Hinkley Point, EDF is carrying out consultations in preparation for submitting a planning application. Realistically, we think that nothing will come forward until this winter or next year, by which time we would expect the national policy statements to have gone through the parliamentary approval process. Given the legal constraints on those issues, I hope that my hon. Friend will understand that there is a limit to what I can say at this stage. We have found the consultation process extremely helpful in understanding the wider picture and the views of local communities and national organisations.