Energy Bill [Lords]

Public Bill Committee, 25 May 2004.

Standing Committee B

Clause 2 - Annual reports under section 1 of the Sustainable Energy Act 2003

Jonathan Sayeed (Conservative, Mid Bedfordshire)

I remind the Committee that with this we are discussing the following:

Clause 2 stand part.

Clause 3 stand part.

Amendment No. 39, in

clause 194, page 149, line 41, after 'section', insert

'and section [amendment of Sustainable Energy Act 2003]'.

Government new clause 7—Reports under section 1 of Sustainable Energy Act 2003—and amendment (a) thereto:

after ''clean coal technology;'' insert '(aa) coal mine methane;'.

New clause 8—Environmental targets—

'(1) The Secretary of State shall within six months of this Act receiving Royal Assent lay before each House of Parliament a report, prepared in consultation with the devolved administrations, on renewable energy and that report shall include—

(a) a set target for the reduction of greenhouse gas emissions, with individual targets for each area covered by devolved administrations as agreed between the Secretary of State and the relevant devolved administrations for the following ten year period,

(b) a set target for the percentage of electricity to be generated by renewable energy sources, with individual targets for each area covered by devolved administrations as agreed between the Secretary of State and the relevant devolved administrations for the following ten year period,

(c) the amount of electricity being generated by each method of renewable energy, and

(d) a strategy for meeting the targets set out in paragraphs (a) and (b).

(2) In each year thereafter the Secretary of State shall lay before each House of Parliament a report setting out—

(a) progress made towards the greenhouse gas emissions reduction target,

(b) progress made towards the renewable energy target,

(c) the amount of electricity being generated by each method of renewable energy, and

(d) strategy for meeting the continuing targets for both greenhouse gas emissions and renewable energy with proposals for any changes necessary for meeting the targets set in subsection (1)(a) and (b).

(3) At the end of the initial ten year period, and every ten years thereafter, the Secretary of State shall lay before each House of Parliament a report setting out the measures specified in

subsection (1) for the following ten year period and in every year thereafter lay before each House of Parliament the report specified in subsection (2).'.

New clause 9—Report on sustainable energy policy commitments—

'(1) It shall be the duty of the Secretary of State to publish in such form as he sees fit an annual report on all the Government's energy policy commitments.

(2) In this section the term ''energy policy commitments'' means all those commitments so specified on the Government sustainable energy policy network website for the time being.'.

New clause 10—Amendment of Sustainable Energy Act 2003—

After section 2 of the Sustainable Energy Act 2003 there is inserted—

''2A Energy efficiency of business and public sector buildings: Secretary of State

(1) The Secretary of State must within one week beginning with the coming into force of this section designate under this subsection at least one energy efficiency aim.

(2) For the purposes of this section an ''energy efficiency aim'' is an aim which—

(a) is contained in a published document;

(b) relates to the energy efficiency of business and public sector buildings;

(c) specifies the amount of carbon dioxide to be saved from business and public sector buildings; and

(d) is compatible with European Union obligations and any other international obligations of the United Kingdom.

(3) The Secretary of State may, at any time after designation under subsection (1), designate under this subsection a further energy efficiency aim or aims.

(4) Where an energy efficiency aim is for the time being designated under this section, the Secretary of State must take reasonable steps to achieve the aim.

(5) In deciding which steps to take for the purposes of subsection (4), the Secretary of State must consider steps relating to the heating, cooling, ventilation, lighting and insulation of business and public sector buildings.

(6) A designation under this section may be withdrawn, but not if its withdrawal would result in there being no energy efficiency aim designated under this section.

(7) If an energy efficiency aim designated under this section ceases to meet the condition in subsection (2)(d) it ceases to be designated under this section, but if this results in there being no energy efficiency aim so designated the Secretary of State must without delay designate a new energy efficiency aim.

(8) A designation of an aim under this section, or a withdrawal or cessation of such a designation, must be published in such a way as the Secretary of State considers appropriate.

(9) A designation may be contained in the same published document as the aim itself.

(10) In this section ''business and public sector buildings'' means buildings specified under any enactments or otherwise as business or public sector buildings.

(11) This section shall come into force on 1st January 2005.''.'.

New clause 12—Duty relating to energy provision and use—

'The Secretary of State shall have a duty to promote the efficient provision and use of energy [gas and electricity], and to reduce the emissions of greenhouse gases.'.

Stephen Timms (Labour, East Ham)

I welcome you back to chairing our deliberations, Mr. Sayeed, and I welcome back all members of the Committee following our weekend break. We had a good discussion on Thursday on this group of amendments. I thought that in responding I would start with my proposal to delete

clause 3 and replace it with Government new clause 7 because much of the discussion focused on that last week.

There are two elements to this proposal. First, should there be a Government commitment to a figure for carbon savings from household energy? As it might be unclear from the record, I want to make it absolutely clear that the Government believe that there should be such a commitment. We have a mechanism for providing it in the Sustainable Energy Act 2003, which came on to the statute book as a result of the work of my hon. Friend the Member for Milton Keynes, North-East (Brian White). The Government proposal uses that mechanism so as to be consistent with the work that has been done in Parliament on this, rather than to cut across it, as clause 3 would, by putting a figure in the Bill, with all the drawbacks that that entails. There is complete agreement across the Committee about the rightness of there being a clear commitment.

Secondly—this is an issue on which much of the discussion on Thursday focused—what should that figure be? In the White Paper we suggested that it should be around 5 million tonnes of carbon savings. The figure that has been published is 4.2 million; if one takes the reasonable view that around five means more than four and less than six, the figure is consistent. The announcement made the other week sits alongside the increased commitment on energy efficiency for business. Total carbon savings from energy efficiency across both sectors will be appreciably more than the numbers set out in the White Paper. It is important that we deliver carbon savings.

I understand the concerns that were forcefully expressed in our debate on Thursday. I listened carefully to all the points that were made. I agree that we should be aiming high in this area. We should be aspirational. The figure of 4.2 million tonnes is the minimum that I would expect to be achieved. I am also concerned about the industry's sense that there has not been a good dialogue with the Government in this process. That also needs to be addressed. Together with my noble Friend Lord Whitty, who leads on this matter, I will arrange to meet representatives of the industry and those who are particularly concerned about the household energy efficiency aims. We will do that before Report.

Brian White (Labour, North East Milton Keynes)

The Sustainable Energy Act allows for a review of that figure. Will my hon. Friend the Minister undertake to consider using that review mechanism once Ministers have met industry representatives and if they convince Ministers of the need to increase the figure to provide security for investment?

Stephen Timms (Labour, East Ham)

There is a review mechanism and, as I understand it, the efficiency commitment is due to be reviewed in 2007. I will certainly consider my hon. Friend's point. I believe that the commitment that has been made will lead to a substantial stepping up of activity in this area, compared with what we have seen

in the past, so it is a big step forward. The Under-Secretary of State for Trade and Industry, my hon. Friend the Member for Edinburgh, South, recently launched the Newcastle warm zone, and there is a warm zone in my constituency. There is a great deal of activity on this issue. Because of the commitment that has been published, we will see much more in the future than we have in the past.

Paddy Tipping (Labour, Sherwood)

Will my hon. Friend the Minister confirm that the purpose of the meeting with outside bodies is to reinforce the 4.2 million tonnes target as the minimum, and that the aspiration is to increase it? If we can do better than the target, that will be in everyone's interest.

Stephen Timms (Labour, East Ham)

My hon. Friend is right. The other aim of the meeting will be to ensure that there is a good dialogue between Government and the industry as we go forward to ensure that the quite serious disappointment that has been expressed up to now does not recur.

Joan Walley (Labour, Stoke-on-Trent North)

As well as talking with the industry, will my hon. Friend be able to see whether the starting point of 4.2 million tonnes could be raised immediately should he have evidence that that was achievable? Will he confirm that we could start at a higher level, rather than waiting until 2007 for the review to take place? In view of the concerns that I expressed last week, will he look with civil servants to see whether there are discrepancies in the way in which the figure that led to the starting point of 4.2 million tonnes was arrived at?

Stephen Timms (Labour, East Ham)

I cannot hold out to my hon. Friend the prospect of the figure of 4.2 million tonnes immediately being changed, given that it has only just been announced. However, I certainly agree that we should aim high. I see 4.2 million tonnes as the minimum that we can expect to achieve and I hope that we will be able to do better, as my hon. Friend the Member for Sherwood (Paddy Tipping) said. I shall return to the other points in a moment.

Michael Weir (Scottish National Party, Angus)

I am slightly encouraged by what the Minister is saying, but a great deal of concern was expressed by hon. Members on both sides of the Committee last week about the fact that the aim was not enshrined in legislation. As I understand it, that was the reason for clause 3. Does the Minister intend to enshrine 4.2 million tonnes as a legislative target, or how does he intend to do that? There is concern that if the target is not in legislation, it can easily slip.

Stephen Timms (Labour, East Ham)

No. We have considered this matter over quite a long period, and the great achievement of my hon. Friend the Member for Milton Keynes, North-East in the Sustainable Energy Act 2003 was to come up with a mechanism that allowed a figure to be set for the energy efficiency commitment and for the Government to have an obligation to do what they can to achieve that aim. That mechanism was put on the statute book last year and is, in my view, the one that we should use, because a great deal of work went into

what was a valuable step forward. The 2003 Act sets out the commitment relating to that number. The number is not printed in legislation, but that would not be the right way to set about effecting the change that we want. The energy efficiency commitment has a clear status, which is set out in the 2003 Act, and will allow the step change in activity and achievement that we all want to see.

The hon. Member for Hazel Grove (Mr. Stunell) suggested that the reason why more carbon could be saved in the business sector was because of a shrinkage in manufacturing. The answer is yes and no. It is true that structural changes have affected absolute carbon emissions, but energy efficiency in the sectors have also been improving. The hon. Member for Vale of York (Miss McIntosh) pointed out that carbon emissions rose last year, which was because of a higher than expected growth in the economy, so it is not true that the current structure of the economy avoids the past difficulties of economic growth leading to higher emissions. We need to do better on energy efficiency in the business sector. For example, since 2001, climate change agreements have roughly tripled the rate of improvement for the sectors that they cover, which has resulted in a doubling in the rate of energy efficiency improvements for industry as a whole. That has gone well, and it is right to give credit where it is due for that achievement.

Andrew Stunell (Liberal Democrat, Hazel Grove)

I see that the Minister is fulfilling my prophecy that he would have calming words for us. However, is it not true that the fastest growing sector of energy consumption is the commercial sector and the fastest shrinking is the industrial sector? That is in no small part due to the measures that affect industry and the failure to introduce measures that affect the commercial sector. In his energy efficiency document, the Minister referred to a new aim to deliver savings of 4.2 million tonnes. Is it not true that that the regulator, Ofgem and everyone else will work to that figure and that it will become the maximum rather than a minimum?

Stephen Timms (Labour, East Ham)

No, I do not believe that it will be the maximum; we can aim to do better. I also do not agree about the distinction between the commercial and industrial sector. The climate change levy applies to the commercial sector, and there are significantly increased incentives for energy efficiency in the commercial sector. Part of the improvement that we have seen and the fact that there are now better prospects for saving energy in the business sector as a whole reflect improvements in the commercial as well as manufacturing sector. I am not saying that structural changes in the economy have had no impact—they clearly have—but the fact that things are looking better than they were at the time of the White Paper a year ago is to be welcomed.

Joan Walley (Labour, Stoke-on-Trent North)

I am getting anxious about the reassurance that I was looking for in respect of re-examining how the civil service arrived at the figures. Will the Minister also comment further as to whether

he has any power to convey to the regulator that the figure of 4.2 million tonnes is aspirational rather a maximum?

Stephen Timms (Labour, East Ham)

On my hon. Friend's first point, I am happy to ensure that the calculations are circulated to all Committee members. I will look at them again, and if Members have concerns, I will be happy to take them up. I will also be happy to emphasise in my discussions with the regulator and others that we all want to achieve as much as possible in saving energy in the household sector.

Brian White (Labour, North East Milton Keynes)

While debating the Utilities Act 2000, I was given similar assurances on combined heat and power, but we have had problems since. Will the Minister examine the history of CHP in light of the assurances given at that time, reflect on those that he is giving on energy efficiency now and ensure that history does not repeat itself?

Stephen Timms (Labour, East Ham)

I will be happy to reflect in the way that my hon. Friend suggests. We will discuss combined heat and power later, so he will no doubt raise that point again at that stage.

Richard Page (Conservative, South West Hertfordshire)

I want to ensure that I have got things clear. The Government are making policy on the hoof. There has been a Government White Paper, the Bill has gone through the Lords and the Government have had discussions with industry, so the CO2 targets and achievable figures should already be known. We should not be consulting industry to decide them now. Will the Minister table an amendment on Report to new clause 7 to add CO2 targets so that we know what we are aiming for?

Stephen Timms (Labour, East Ham)

I am grateful to the hon. Gentleman for giving me the opportunity to make clear that that is not what I intend to do. We already have a mechanism, through the Sustainable Energy Act 2003, which allows us to set those objectives—[Interruption.] I see from his mirth that he knows that. The figures have been set. I hope to ensure that, through the discussions that my noble Friend and I have with representatives of the industry before Report, we have the adequate dialogue with industry that we have not had until now.

We are already required to publish an annual report on progress made towards the energy White Paper's objective; that was another benefit from the Sustainable Energy Act, for which my hon. Friend the Member for Milton Keynes, North-East was responsible last year. To achieve our aims we will need wide participation from large numbers of interested parties. We have a vested interest in ensuring that our plans are open to public scrutiny, because that will improve them.

New clause 7 retains the principle behind clauses 2 and 3 in a way that amends the general reporting requirement in the Sustainable Energy Act, so that the relationship between the new and existing duties is clear. The proposal will require information to be provided on exactly the same list of low-carbon energy sources currently set out in clause 2. There was

discussion last week about the significance of the order in which the items occurred in that list. All we have done, to be helpful, is to reproduce the order in which they appear in clause 2.

Colin Challen (Labour, Morley and Rothwell)

Why has the word ''nuclear'' appeared when the original intention of the Sustainable Energy Act was to consider renewables?

Stephen Timms (Labour, East Ham)

The answer is the same as the one I gave a second ago; it is the same wording as in clause 2 of the Bill. We wanted to make minimal changes to what was already in the Bill but put it in a form that was consistent with the Sustainable Energy Act. We have not deleted things from clause 2 that members in the other place wanted to be there. As my hon. Friend rightly said, the word ''nuclear'' was included in the other place and is retained in new clause 7.

However, new clause 7 goes further in adding proposed new subsection (1B)(j), which broadens the requirement to include any other sources of energy that may help reduce carbon emissions. That will include solar energy, which was mentioned last week, and carbon capture and storage, as mentioned by my hon. Friend the Member for Wansbeck (Mr. Murphy) in his helpful contribution on clean coal technology.

I am prepared to accept the amendment tabled by my hon. Friend the Member for Sherwood (Paddy Tipping), which would add coal mine methane to the list of energy sources and technologies in subsection (1B) of new clause 7. The new clause departs from clause 2 in other ways to make the provision workable: for example, it sets out the information that the Government have the ability to collect. It also provides a more realistic basis for reporting and requires the Government to publish information on what is done to ensure

''the maintenance of the scientific and engineering expertise available in the United Kingdom that is necessary for the development of potential energy sources''

listed in the subsection.

It was suggested in our debate last week that the implementation of the large combustion plant directive was going to be delayed, but that is not the case. The point made by the Minister for the Environment and Agri-environment at Environment questions last week was that it is a complex directive with significant potential ramifications for large combustion plants in a range of sectors. We are taking time to reach a fully informed decision, but the implementation date is 1 January 2008, which has not changed.

Anne McIntosh (Conservative, Vale of York)

What emerged from Question Time last week is the fact that there are two options available to the Government for the implementation. We very much favour some regard being paid to clean coal technology. At what point do the Government intend to consult widely with

industry to consider which option they favour, bearing it in mind that there is much support for that technology from Government Members?

Stephen Timms (Labour, East Ham)

We are consulting widely and have been doing so for some months. I expect that we shall announce our conclusion in the next few weeks; we want to be able to do so by the end of June.

In amendment No. 8, my hon. Friend the Member for Brighton, Kemptown (Dr. Turner) suggests adding the term ''deployment'' alongside ''research, development and demonstration'' as areas to be reported on in relation to the energy sources listed. As he pointed out, if what I am suggesting to the Committee is agreed, his amendment would not work as clause 2 would not be there to amend. However, I am happy to table on Report a Government amendment to new clause 7 to add the term ''deployment'' in the way that he suggests. I hope that that will satisfy his concern.

New clause 8 would impose a duty on the Secretary of State to set targets on curbing greenhouse gas emissions and on

''the percentage of electricity to be generated by renewable energy sources'',

together with reporting on those targets. We are committed to reducing greenhouse gas emissions by 12.5 per cent. by 2012, and to reducing carbon dioxide by 20 per cent. by 2010. Compared with most other European countries, we are most likely to achieve our Kyoto objectives, and I am confident that we shall.

We are committed to sourcing 10 per cent. of UK electricity from renewable sources by 2010. The devolved Administrations in Scotland, Wales and Northern Ireland are already promoting renewables, and my officials are working closely with officials there. However, specifying percentages of electricity to be generated by each renewable source, as the new clause does, would be too prescriptive.

One of the principles of the obligation, and one of its benefits, relates to the fact that we cannot predict exactly which technologies will be the most successful or when that will be the case, because some of those technologies are still in their infancy. It would not be helpful for us to attempt to predict precisely how much each technology would contribute some years ahead. That could hamper other developments that are not clear to us at present, but which will in due course help us to achieve our overall objective.

Michael Weir (Scottish National Party, Angus)

The Minister misunderstands the proposal. The intention is not to specify set amounts for each source of renewable energy, but to have an overall target for renewable energy and to report annually the amount from each source within that overall target. We could then see how we were progressing towards the target. Concern was expressed in the earlier debate that ambitious targets are being set without knowing whether many types of energy generation can meet those targets within the specified time scale.

Stephen Timms (Labour, East Ham)

I can reassure the hon. Gentleman on the amount of information that will be published. There is a large amount of information on the

sustainable energy policy network website and we will continue to keep that up to date over the coming months, so that people know exactly how we are progressing. Reports on how much each technology contributes will certainly be available.

One of the questions I was asked in the debate last week was how much capital funding we are providing for technologies other than wind. In the spending review period 2002-03 to 2005-06 we are making available £117 million in capital grants for offshore wind, although there are no grants for onshore wind developments. We also provide £66 million for biomass capital grants; £25 million through a major photovoltaics demonstration programme; £10 million for community and household projects; £10 million for energy research; £5 million for wave and tidal energy; and £4 million for embedded generation. In addition, we provide £19 million every year for research, development and demonstration through the new and renewable energy programme for all those technologies.

New clause 9 would add a requirement for an annual report on the commitments specified on the sustainable energy policy network website. There is already a requirement to publish an annual report. I know that my hon. Friend the Member for Milton Keynes, North-East, who tabled the new clause, is familiar with the website, which we aim to update every month. The aim of the new clause will be more than met by the arrangements that are in place.

New clause 10 would require the Secretary of State to publish an energy efficiency aim for business and public sector buildings. I suggest to the Committee that focusing only on buildings would be unhelpful. We need to examine energy efficiency across business, including the energy efficiency of equipment and industrial processes. In the energy efficiency action plan, we have set out programmes to deliver carbon savings across business and the public sector. As I said earlier, the measures that we have introduced in that area are effective, so there is no need for a separate statutory target relating to buildings.

I have spoken at length about the Government's commitment to promoting the efficient provision and use of energy, and the reduction of greenhouse gas emissions. The danger of new clause 12 is that it would increase the likelihood of a legal challenge from those who have different views on the steps that the Government should be taking.

Robert Key (Conservative, Salisbury)

Since last week, tectonic plates have shifted, to paraphrase the Deputy Prime Minister. We will shortly be invited to vote on a series of amendments that are fundamental to the Bill. The Minister will have seen the article in The Independent yesterday by the great environmental hero Professor James Lovelock, who said:

''We have no time to experiment with visionary energy sources; civilisation is in imminent danger and has to use nuclear—the one safe, available, energy source—now or suffer the pain soon to be inflicted by our outraged planet.''

Will the Minister let us know his thoughts on Professor Lovelock's article, which is so important to the future of energy provision?

Stephen Timms (Labour, East Ham)

That does not arise in the context of this group of amendments, although we are about to come to parts of the Bill that deal with nuclear power. I have seen the article to which the hon. Gentleman refers—

Robert Key (Conservative, Salisbury)

Don't rubbish it.

Stephen Timms (Labour, East Ham)

I am not rubbishing it, but I caution the hon. Gentleman and others against believing that nuclear power is a quick fix. We need to focus our attention on making headway in the development of renewable energy. We made it clear in the White Paper that we might need to consider the prospect of new nuclear power, but at present the economics are very unattractive. There are some big questions about nuclear waste still to be answered, but this is not the time to discuss them. We shall look at the matter again when we debate the next section of the Bill.

On the basis of what I have said to the Committee, which reflects hon. Members' concerns, and given my point about meeting the industry and providing further information, I hope that the Committee will accept the proposal.

Laurence Robertson (Conservative, Tewkesbury)

I welcome you to the Committee, Mr. Sayeed.

We have had a long debate over three sittings on these important clauses, and most members of the Committee have taken part, which is a welcome change, as Government Members often do not participate.

We have heard much about the Sustainable Energy Act 2003, on which I made my first speech as shadow spokesman. The speech was memorable as it took about 30 seconds to make at about half-past 2 on a Tuesday when it finally got through the Commons. The Act, too, was memorable because it was considerably weakened compared with the original drafting because targets were removed. Since enactment, an early-day motion has been tabled on strengthening the measure.

Clause 3, which has drawn a great deal of support from both sides of the Committee, is useful because it strengthens the Bill in equal measure to the weakening of the Sustainable Energy Act due to the removal of targets.

I asked the Minister to justify replacing clause 2 with new clause 7 and he has gone some way to doing so, but I must ask my hon. Friends to support clause stand part. My only slight concern, which relates to the mechanics of the Committee and how we consider amendments, is that I have considerable sympathy for amendment (a), which was tabled by the hon. Member for Sherwood and which would include coal methane in the energy sources listed in clause 2, and indeed in the Minister's new clause. I think we will have an opportunity to vote on that separately, and I shall ask my hon. Friends to consider supporting it.

We want to keep the clauses as they stand. I am becoming concerned about the position of renewables, and that point is emphasised by the intervention about nuclear energy by my hon. Friend the Member for Salisbury (Mr. Key). Again, we can return to that

debate in the near future—probably under the next set of amendments—but it shows the position that we are in. As we discussed on Second Reading, the contribution from nuclear sources is about 22 per cent. of our electricity; in 10 years' time, that will be down to 2 per cent. There is a very long way to go between now and then to bring renewables up to speed to replace the missing 20 per cent. Even if we achieve that, we will have gone nowhere on carbon reductions, because nuclear does not contribute to carbon emissions. My hon. Friend made a good point, if prematurely, and no doubt we can return to it. I ask my hon. Friends to support the retention of clauses 2 and 3.

Andrew Stunell (Liberal Democrat, Hazel Grove)

I said at the previous sitting that I expected the Minister to administer ointment and balm during our discussions, and he has done his best to do so. He presented new clause 7 in the best possible light, but it still deletes the targets and limits the Government's obligation to report on matters that the Secretary of State wants to report on rather than matters that should be reported on.

I was particularly interested in the Minister's reinterpretation of 5 million tonnes as something less than 6 million tonnes but more than 4 million tonnes. I do not know whether he has ever tried that approach in a magistrates court, but I suspect that it would not get very far. I am not sure whether a group of school governors could get away with such an approach to targets with Ofsted. The reason why one could not get away with it in a magistrates court or with Ofsted is that we would be talking not simply about an aspiration, but about a legal requirement. Every member of the Committee who has spoken except the Minister wants a proper, official statutory requirement. He has disappointed us tremendously by failing to go for that.

I have said before that the difficulty is that the regulator, who has one of the principal duties to ensure that things happen, takes a narrow view of the tasks. There is no doubt that if the measure does not contain a figure, Ofgem will take the view that it can allow the market to dictate progress, and if we include a figure that is well below 5 million tonnes, Ofgem will set that as the maximum to which it is prepared to go in, as it would see it, distorting the market.

The Minister boldly said that he wanted to be aspirational, but the energy efficiency plan for action refers to the announcement of a new aim of delivering savings of 4.2 million tonnes. The figure is already aspirational and is about as woolly and floppy as it gets. He is not setting an aim, but following a trend.

The Minister made several useful points about the contribution that the commercial and industrial sectors make to energy efficiency savings. I would like to debate that in more depth on another occasion, because it raises very important issues. However, the essence of the debate on clauses 2 and 3 is whether the domestic sector, which is responsible for 30 per cent. of carbon emissions, should have more rigorous carbon reduction targets. The Minister has decided that it

should not, and that it should simply follow what current trends predict. That is bitterly disappointing to those of us who believe that a much more vigorous assault on the problem is needed. Whether there are any levers in the legislation will determine whether the regulator takes the problem seriously. The question does not solely, or mainly, concern the sources of energy that we use, but what demand we apply to the system. That is particularly true of the domestic sector, where efficiency of use is at least as important as the nature of the supplies that are delivered to it.

We seek to retain clause 3 as well as clause 2, and if the hon. Member for Milton Keynes, North-East is inclined to press new clause 9, we shall support that too. I recognise that the Minister has done his best and has made moves in the right direction, but it is difficult to see any progress. We think that coal mine methane is a sensible addition to the list, and we hope to proceed on that basis with either an amendment to clause 2 or with an amended new clause 7.

This has been a disappointing debate; I do not believe that the Minister has substantially answered my earlier charge that he misled the Committee by saying that new clause 7 is a proper substitute for clauses 2 and 3. The opportunity has been missed.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

Order. The hon. Gentleman cannot say that the Minister has misled the Committee. Does he wish to withdraw that statement?

Andrew Stunell (Liberal Democrat, Hazel Grove)

I allowed my enthusiasm to run ahead of my propriety. I apologise to the Committee and the Minister.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

Is the statement withdrawn?

Andrew Stunell (Liberal Democrat, Hazel Grove)

Unreservedly. It is particularly unfortunate that I said that, because I have a high regard for the Minister, whom I know tries his best to give the Committee the information that he feels that we should have and to ensure that it is accurate. I therefore apologise. None the less, perhaps the remark was a measure of how disappointed and concerned my colleagues and I are that an important opportunity for what is supposed to be a Bill that will set policy for the next decade, and possibly after, has been missed. We shall seek to divide on clauses 2 and 3.

Laurence Robertson (Conservative, Tewkesbury)

On a point of order. Mr. Sayeed. I said earlier that the amount of electricity derived from nuclear sources would be down to 2 per cent. in 10 years. I apologise, but I should have said 20 years.

Stephen Timms (Labour, East Ham)

Further to that point of order, Mr. Sayeed. The proportion of electricity derived from nuclear sources by 2020 will be about 7 per cent.

Laurence Robertson (Conservative, Tewkesbury)

In 20 years—by 2024—it will be 2 per cent.

Desmond Turner (Labour, Brighton, Kemptown)

I am grateful to my hon. Friend the Minister for accepting the principle that there is a huge, clear distinction between the development of a machine or technology and its deployment. For instance, the

Army could have the most magnificently developed tank in the world but if it is sitting in a garage in Aldershot, it will not fight any wars until it is deployed.

I am happy with the Minister's assurance that he is prepared either to table or to accept an amendment on Report. I hope that he will resist any blandishments from his departmental lawyers trying to tell him that there is no difference between development and deployment. Lawyers are always wrong, and it is nice to serve on a Committee that is not dominated by lawyers. If there are any here, I shall say it again: lawyers are usually wrong. Given the Minister's helpful response, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Motion made, and Question put, That the clause stand part of the Bill:—

The Committee divided: Ayes 8, Noes 10.

Clause 3 - Annual report on energy efficiency

Energy Bill [Lords]

The Nuclear Decommissioning Authority

Norman Baker (Liberal Democrat, Lewes)

I hope that it is appropriate to make general comments about the proposal to establish the Nuclear Decommissioning Authority as that will enable me to curtail future comments on later amendments. The good news is that the Liberal Democrats believe it right—indeed, long overdue—to establish such a body. There is a need to assess the amount of time, effort and money to be devoted to the decommissioning of nuclear facilities and the onward transmission to waste disposal. I also welcome the Government's statement, in their document, ''Developing a Framework For Stakeholder Engagement and Transparency for the Nuclear Decommissioning Authority (NDA)'', that it is important to establish

''the credibility of the NDA as a body which can deliver and will make a difference.''

The establishment of such a body throws into sharp relief the costs of decommissioning, which at £48 billion will be £8,000 for every man, woman and child in the country. Although this debate is not about new nuclear build, those who advocate it may wish to consider the cost to date of the nuclear industry for every person in the country.

Laurence Robertson (Conservative, Tewkesbury)

The hon. Gentleman is right to suggest that the past record of the nuclear industry has left a cost legacy. However, does he accept that, with changed technology, those costs would not necessarily be repeated?

Norman Baker (Liberal Democrat, Lewes)

That is an interesting hypothesis, which we have heard over several decades from the nuclear industry, but it has invariably proved to be wrong. Perhaps one day it will be right, but I have seen no evidence for that and would not take the chance. I want to stress that in making these comments, I am not making the argument for or against new nuclear build. I want to address my remarks to the decommissioning challenge.

The first thing to do is establish exactly how independent the nuclear decommissioning authority would be. The Government's framework document refers to the need for transparency, but there are several important relationships with the NDA that are not entirely clear. Before we go into the detailed clauses in chapter 1 of part 2, it would be helpful if the Minister commented on that.

For example, it is not entirely clear what the relationship will be between the NDA and the parts of the nuclear industry that continue to be actively involved in generation, such as BNFL and, to take a private sector example, British Energy. We know that the NDA will be situated in Cumbria, which is a welcome development as it will protect jobs up there. That was discussed on Second Reading by the local Member of Parliament, the right hon. Member for

Copeland (Dr. Cunningham), and we all agree that there is a need to ensure that the skills and knowledge base in Cumbria are not lost and that we have an opportunity to protect jobs in a positive way.

That is not in dispute, but the NDA will be literally across the road from people from whom it is receiving material and locations to be decommissioned. In those circumstances, it is important that the NDA is not only independent, but seen to be independent. The authority is a good concept. I hope that it succeeds and attracts cross-party support—not just in principle, but in practice throughout its lifetime—but if it is to do that it needs to be independent. Any suggestion that it could be used to bolster the nuclear industry would be unhelpful. It has a function entirely separate from nuclear generation, and irrespective of one's views on nuclear generation, the NDA should have that separate role and not be used either to attack or to support nuclear generation. It should have a discrete role, and it is important that it is constructed so that it is seen to have that.

There are real issues as to the independence of the NDA. Will the Minister tell us who will give it direction? The Bill, unless I have misread it, is rather vague on that. Will direction be the sole responsibility of the Secretary of State, or will the industry have a hand in determining how it is governed? That is an important point of principle. My hon. Friends and I believe that there should be an arm's-length relationship between the NDA and the industry. I do not want to speak for the Conservatives, but I imagine that their amendments will propose a different view, so this is an important principle to establish.

The relationship between the NDA and Nirex, which is the great unspoken body in the Bill, is also unclear. Nirex has a responsibility for long-term waste disposal—I do not like the word ''disposal'', because this material remains active for a huge number of years—but clause 6 gives the NDA some responsibility for disposal. Will the Minister clarify what the relationship will be between the NDA and Nirex? Will the NDA's disposal responsibilities be limited to low-level waste, as I believe they should be, or will it have a function on intermediate and high-level waste?

I hope that you agree that this is the best time to raise these questions, Mr. Sayeed. It is important that when we agree to the establishment of the NDA, we understand what we are agreeing to. The issues are fundamental and they will determine whether the NDA will work.

It is important also that the NDA has an overriding principle, so that people are clear about its primary function. I believe that it should be to protect human health and the environment, but that is not stated in the Bill. Will the Minister clarify what he believes to be the primary duty of the NDA? The lists of responsibilities in clause 6 and general duties in clause 12 do not meet that challenge.

I do not want to take too much time at this point, but there are a number of questions about the NDA. There is also the question whether it will be a nuclear

generator or simply a decommissioner. Cross-reading clauses 6 and 12 seems to imply that the NDA can be empowered to continue to generate nuclear waste and nuclear electricity, and even—possibly—to build new nuclear generation stations if that is deemed necessary to carry out its ''functions''. It could continue to generate plutonium and, in other words, it could become the opposite—

Jonathan Sayeed (Conservative, Mid Bedfordshire)

Order. The hon. Gentleman is straying from the clause and trailing some of his amendments. I would be grateful if he confined his remarks to the clause.

Norman Baker (Liberal Democrat, Lewes)

I am trying to help the Committee by questioning the principles behind the establishment of the NDA. I want to find out exactly what the Minister intends. I have no wish to trail my amendments, as you succinctly put it, Mr. Sayeed. I have raised issues that are germane, although I will not go into them in great detail. The establishment of the NDA is a positive step, but it needs to be transparent and independent; it needs to deal with waste, not generate it. Those are the assurances that I seek from the Minister.

Desmond Turner (Labour, Brighton, Kemptown)

I strongly support the principle of setting up the NDA, but I would like clarification on two points. The hon. Member for Lewes (Norman Baker) is getting into complex and unnecessary ground when he tries to separate responsibilities for high-level, intermediate or low-level nuclear waste. I find that strange. Clearly the NDA should have responsibility for all nuclear waste. If it deals with a nuclear generating station that has just finished working, all those categories of waste will be involved.

Norman Baker (Liberal Democrat, Lewes)

Of course the NDA has responsibility at that point, but we must consider the question whether it retains responsibility or whether responsibility transfers to Nirex. That is not clear in the Bill.

Desmond Turner (Labour, Brighton, Kemptown)

I was coming to Nirex. I put it to the Minister that responsibility should always rest with the NDA. It may choose to delegate it to a contractor under its supervision, but it should still remain responsible. I want him to confirm that point, if I am correct. What relationship is proposed between the NDA and Nirex?

Laurence Robertson (Conservative, Tewkesbury)

That final point, which was raised by the hon. Member for Lewes a few minutes ago, is important. According to a written answer,

''the Government are giving consideration to the future of Nirex. It will only be possible to set out definitively the relationship between Nirex and the Nuclear Decommissioning Authority once this consideration has been completed.''—[Official Report, 10 March 2004; Vol. 418, c. 1506W.]

I hope that that consideration has been completed and that the Minister can tell us about it. It is important to establish what that relationship will be. As the hon. Member for Lewes said, it is also important to establish what the relationship between the NDA and the industry will be. I do not want to speak too much on that because I have tabled relevant amendments to later clauses.

We welcome the creation of the NDA. Successive Governments have undoubtedly ducked the nuclear waste issue, which is unfortunate and need not have been the case. Just last December, I had the pleasure of visiting Finland to see what that country does with its nuclear industry. It is building a fifth reactor, which is not disproportionately costly, and has made some interesting arrangements. Perhaps we can return to that.

The important point is that the Finns are also dealing very effectively with waste. They have one underground repository for low-level and medium-level waste, and are building a second for dealing with high-level waste. When one considers how efficiently and cleanly they are dealing with that and what a small surface area is taken up, one wonders why we in the UK did not deal with these matters as effectively and efficiently. That is to be regretted, but I welcome the fact that the issue is finally being addressed.

We have already expressed many concerns about how the NDA will be formulated, how it will work and what relationships it will have. In principle, however, it is good that it is being set up. There is a great deal for it to do and it has many issues to deal with, which we will discuss later. However, we support the clause.

Michael Weir (Scottish National Party, Angus)

I shall be brief. I also welcome the setting up of the NDA, but I share many of the reservations expressed by the hon. Member for Lewes about the questions that are still to be decided. Given your strictures, Mr. Sayeed, I will not discuss matters relating to later amendments, but I make the serious point that the NDA must be seen to be totally independent of the nuclear industry. We would all agree that the nuclear industry has had problems with the disposal of waste and with keeping records of what is in the waste dumps in the UK. If we are to tackle the nuclear legacy once and for all, we must ensure that that is done independently and transparently.

The problem of the nuclear industry may be summed up by the fact that, 18 years after Chernobyl, there are still hill farms in Scotland where the sheep cannot be moved because of the high levels of radiation that they suffered—that is all those years after a radiation cloud from Russia came over the UK. That is a measure of the problem that we face—it is not specifically a waste problem, but it is similar.

When I raised questions about the nuclear industry and future energy generation by the NDA during the last sitting of the Committee, my concerns were rubbished by the Minister. However, there are serious problems with how the Bill has been phrased in those respects. I reiterate the point that if the NDA is not seen as completely independent and as an organisation set up to deal with waste rather than to generate electricity, it could lose public support and run into difficulties.

Stephen Timms (Labour, East Ham)

I am pleased by the warm and wide welcome for the creation of the NDA, which has been reflected in the speeches.

Clause 4 simply provides for the establishment of the NDA as a body corporate and sets out its status. The NDA will be similar to most other non-departmental public bodies in that it will not act on behalf of the Crown—except in one specified circumstance, which we will discuss when we reach clause 10—and will not, therefore, enjoy any corresponding status, immunities or privileges.

In November 2001, the intention to create such a body was announced, and that was elaborated on in the 2002 White Paper. The creation of the NDA reflects the fact that there is a large technical and managerial challenge that needs to be met to deliver the necessary clean-up. It also reflects the Government's determination, through competition, to ensure that the best available skills and experience from the public and private sectors are brought to bear on the issue, and makes it clear that our priority is safe, secure, cost-effective clean-up that protects the environment—an important part of what the NDA must achieve. The creation of the NDA also reflects our desire for the management arrangements for clean-up work to be open and transparent and to command public confidence.

I hope that one of the benefits of the creation of the NDA will be to dispel some of the aura of mystery and secrecy that has surrounded the nuclear industry, which has been detrimental to the industry and to those who wanted to know more.

We shall return to many of the points raised in the debate when we discuss later amendments. I entirely agree that the NDA should be seen to be independent. It will be subject to ministerial oversight in the usual way; it will operate openly and transparently and consult on its plans. Its annual report and accounts will also be subject to the usual NDPB arrangements for public scrutiny. I believe that it will achieve the necessary independence, which I agree is important.

The NDA will have responsibility for securing the decommissioning and clean-up of designated sites, at which site operators will have to develop work plans to meet the NDA's objectives, subject to regulatory requirements; the NDA will fund those operators. The NDA's primary duty will be to drive forward clean-up and it will have to operate within the existing regulatory framework. The other things that it might do will be subject to the overarching obligation to clean up.

Anne McIntosh (Conservative, Vale of York)

Will the Minister explain how the NDA will function within the regulatory framework as it applies to Scotland? Page 15 of the regulatory impact assessment states that the clause is subject to the agreement of the Scottish Parliament, a point that we can explore in the context of the amendments to clause 5. The Minister said that the proposal would go through speedily, but I wondered at what point it would be considered by the Scottish Parliament.

Stephen Timms (Labour, East Ham)

As the hon. Lady said, we will consider that issue in a moment. There is devolution to Scotland on these matters, which must be reflected in the Bill and in the way that the arrangements are made.

The relationship with Nirex was raised. We are still considering its future, and the review is not yet complete. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs announced in July that Nirex would be made independent of industry and subject to greater Government control. We are considering the means of securing that objective, and we will announce the outcome of the review as soon as it has been completed.

The NDA will carry out the responsibility for directing the work of its site operators; it could also be given responsibility for constructing and operating disposal facilities. It will be responsible for dealing with hazardous material at its sites—treating, storing, transporting or disposing of low, intermediate and high-level waste. That involves the full range of material, as my hon. Friend the Member for Brighton, Kemptown suggested. The Bill provides for the NDA to be given responsibility in designated circumstances for dealing with hazardous material not at its sites. It will set out its plans for waste management in its five-year strategy and annual work plans.

I am pleased that the establishment of the NDA has been welcomed. It is a good step forward in dealing with a big problem that will have to be dealt with for many decades, and we shall consider the details in a moment. I commend the clause to the Committee.

Question put and agreed to.

Clause 4 ordered to stand part of the Bill.

Clause 5 - Constitution of NDA

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 76, in

clause 5, page 3, line 12, at end insert—

'(1A) Persons who have held office or been employed by nuclear generators or processors within a six-month period prior to appointment shall be ineligible for membership.'.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

With this it will be convenient to discuss the following amendments: No. 42, in

clause 5, page 3, line 14, after 'State', insert

'after consultation with representatives of BNFL, British Energy, Nirex and the UKAEA'.

No. 43, in

clause 5, page 3, line 16, at end insert

'and representatives of BNFL, British Energy, Nirex and the UKAEA'.

No. 44, in

clause 5, page 3, line 29, at end insert

'following the Secretary of State's consultation with representatives of BNFL, British Energy, Nirex and the UKAEA'.

Norman Baker (Liberal Democrat, Lewes)

It is germane to this clause to welcome the vision that the Minister set out in his previous contribution, particularly his recognition that the industry and the NDA must be seen to be separate, and that the NDA must be independent—that is exactly right. The amendment suggests a way of demonstrating to the public that the NDA is separate

from the industry, as well as giving the assurance that its primary duty—to deal with the decommissioning of facilities and its consequences—is separate from the interests of nuclear generators.

It is unclear exactly what the NDA's first year programme will be, because we have not discussed that yet. A figure of £2 billion has been bandied about as the money that it will have for the first year. Will the Minister confirm or deny that? In any case, who will determine the spending priorities? It is important that those who are appointed to leading positions on the NDA are separate from the industry so that they can focus clearly and independently on the role that the Minister expects them to fulfil. If people in Cumbria cross the road to join the NDA immediately, there will not be the traditional break that applies to civil servants or Ministers when they take up positions after having been in office.

There is a good reason for that break period; it is an essential safeguard. It is a well established Government practice, and the amendment would install it in this context. Without that break, the independence of the NDA could be compromised. More importantly, key personnel appointed to the NDA could come straight from the industry and determine the first year's spending programme. If the spending programme is drawn up by DTI officials, there will be a degree of independence. However, if it is drawn up based on submissions from British Nuclear Fuels Ltd., British Energy or others, we will have to question whether the priorities are right. How the money is spent is important.

In the first year, the NDA will enter into contracts—often long-term contracts—with individuals and companies pursuant to its powers and duties under the Bill. If mistakes are made in the first six months or year, they will be difficult to rectify subsequently. One might say—the hon. Member for Southampton, Test (Dr. Whitehead) alleges that this is my conspiracy theory—that those with an interest in the preservation and enhancement of nuclear power would be interested in how the programme is constructed by the NDA. To avoid any suggestion of that, the NDA should be entirely independent. That is what the amendment would secure. I hope that the Minister will support it.

The industry recognises that opportunities will arise from the NDA's first year of operation. Only last week, an advert from BNFL appeared in The Parliamentary Monitor that stated:

''The onset of new legislation presents a whole new world for BNFL. This legislation will manifest itself as the Nuclear Decommissioning Authority.''

It continued that freedom from restraints, such as historic waste,

''will allow us to develop commercially and internationally in both government and utility sectors. In short, it's the dawning of a new era for BNFL.''

So, it clearly sees an opportunity from the establishment of the NDA. It is matter of Government policy as to whether it is a new dawning for BNFL, but that is separate from the establishment of the NDA. We must ensure that the personnel involved are clearly separate and not helping BNFL with its objective.

Laurence Robertson (Conservative, Tewkesbury)

The amendments that we have tabled come from the opposite point of view to that expressed by the hon. Member for Lewes. I propose that, before the chairman, non-executive directors and chief executive are appointed, there should be discussions with the industry, and I have specified BNFL, British Energy, Nirex and the United Kingdom Atomic Energy Authority. The NDA will deal with work of the highest importance. Indeed, it is difficult to imagine anything more important in terms of the environment and public safety. The work will be extremely complicated as well as important. In fact, not much is more complicated than the nuclear industry. I am not talking about seeking the industry's permission before making the appointments—that would be wrong—but it would be sensible to seek the advice and opinions of people in the industry beforehand.

We are involved in setting up yet another body. I do not know whether it officially qualifies as a quango, but we have thousands of quangos. Some are useful and some are not, but it is very important that this body be useful and effective. It would therefore be rather foolish to disregard or reject the advice that may be given by the UKAEA, which has been operating since 1954, and by BNFL, which I understand has been operating for 30 years, if not more. That is the basis of the amendments. They do not suggest that those bodies should have to grant permission, but merely that their opinions should be sought. Given the importance of the work that will be carried out, that is the least that we should expect.

Richard Page (Conservative, South West Hertfordshire)

Unsurprisingly, I support my hon. Friend and, regretfully, I disagree with the hon. Member for Lewes. Along with everyone else, I welcome the setting up of this agency. As my hon. Friend said, that is long overdue. It was unfortunate that, in 1997, a geological survey in Cumbria brought a halt to the idea of having a high-level waste disposal facility.

I understand where the hon. Gentleman is coming from, but he advances an argument that is contrary to the reality of what happens when civil servants leave to go to industry. They take with them knowledge of, and expertise on, Government programmes and policies and what could be happening, and that might give a financial advantage to one company. They have a six-month cooling-off period in which, in theory, the Government move on at such a rate that the expertise and knowledge of those civil servants is completely lost, and then they are supposed to go into a company without giving it the commercial advantage that it would have had had they joined it immediately. I have not yet fathomed how that prevents a civil servant from talking to the company that they are to join in six months' time, but illumination will, no doubt, come at some point.

I say to the hon. Member for Lewes that the situation is not as he suggested. It is not about a gamekeeper becoming a poacher—I exaggerate to make the point—but about a poacher becoming a gamekeeper. Is he seriously saying that someone with knowledge of the industry should not be able to join a decommissioning agency immediately so that he can

give advice and help to ensure that the work is done as quickly and effectively as possible, but that, unfortunately, the agency should have to hold off for six months before it can benefit from that person's knowledge? That would be completely against the national interest.

My hon. Friend the Member for Tewkesbury (Mr. Robertson) made his points with his customary clarity. I am sure that, in an industry as tight-knit as the nuclear industry in this country, the Government and the officials will, in some shape or form, have discussions with people from Nirex, BNFL and so on, because they will be the necessary runners and riders for the posts that are coming along. My hon. Friend wishes to see that point covered in the Bill, so that there will be transparency in the process. I hate to tell the Government that they sometimes operate behind closed doors, but we should like to see the selection process more open and described in the Bill, so that industry knows about the type of people who will become part of the system. Let us have some political honesty and transparency; that is the reason behind my hon. Friend's amendment, which I enthusiastically support.

Michael Weir (Scottish National Party, Angus)

I shall be relatively brief. As has been said, the amendments come from two different extremes. I support the view of the hon. Member for Lewes, who said that it is important that the public are confident that the NDA is transparent. If the Conservatives' amendments were accepted, that transparency would be lost. This is a case not of poacher turned gamekeeper, but of showing that we have reached a new stage in dealing with the legacy of nuclear waste.

To put it bluntly, the nuclear industry has not always been transparent. There has been a culture of secrecy in many areas of it and record keeping in many nuclear dumps has been less than transparent. There is even a degree of doubt about what is in those dumps. Those who set up the dumps are not the same people who work for those organisations now.

There is a long history of secrecy in the nuclear industry, and in setting up a transparent and independent agency to deal with that legacy we must ensure that the same people cannot simply cross over to it from the nuclear industry. That is not to say that the NDA will not need technical advice. Clearly it will, and some of those giving advice may come from the nuclear industry. We are talking here about the non-executive directors and chairman of the NDA, and we must ensure that they are not those who ran the nuclear industry in the past.

Richard Page (Conservative, South West Hertfordshire)

Can I get this absolutely clear? Is the hon. Gentleman saying that somebody coming from industry, who may have knowledge of procedures that are not up to speed or of radioactive material being stored unsafely, should not take up the job immediately and pass on such information, but should wait six months? I would like him to clarify the point.

Michael Weir (Scottish National Party, Angus)

The point I am making is that a new organisation must be seen to be transparent. I am not suggesting that nobody with experience or knowledge should work for it, but we are talking here about the non-executive directors and chairman. They must be seen to be independent and focused on the historical problem.

Stephen Timms (Labour, East Ham)

The amendments all propose changes to the arrangements for appointments to the NDA board. As the hon. Member for Tewkesbury said, they point in opposite directions. The hon. Member for Lewes proposes ruling out people who have recently been employed in the nuclear industry from serving on the NDA board, and the points put by the hon. Member for Tewkesbury on that issue have merit. The board will need nuclear skills, so it would be unhelpful to set it out in legislation that the board cannot hire people who are most likely to have up-to-date knowledge. The board will need people with up-to-date expertise and we should not exclude that possibility, as the amendment would.

Equally, the proposals tabled by the hon. Member for Tewkesbury requiring the Secretary of State to consult existing nuclear organisations before appointing the chairman, chief executive and non-executive directors would also create problems. It is not appropriate to set out in legislation the organisations that should be consulted, particularly when those bodies will derive funding from the NDA. It could put those individuals in a difficult position if they were consulted in the way that he suggests.

The Bill proposes that the arrangements for appointments to the board should follow well-established procedures involving the Office of the Commissioner for Public Appointments and that we should be able to establish a fit-for-purpose organisation and preserve flexibility to ensure that it remains fit for purpose over the long period in which we envisage it operating.

Norman Baker (Liberal Democrat, Lewes)

The Minister will not be surprised to know that I find his response to the hon. Member for Tewkesbury entirely convincing and his response to me entirely unconvincing.

To pick up on one point, of course there will be a close relationship between the NDA and the nuclear industry—it would be difficult to imagine how it could operate without such a relationship. There will be discussions between the NDA and the industry on technical matters relating to decommissioning, and the industry contains important expertise that will have to be listened to, but because that relationship will be so crucial and will have to be so close, the NDA board must be seen to be independent. That underlines the need for my amendment.

The Minister recognises that the organisations dealing with the NDA will derive funding from it, but he appears to be happy for someone working in one part of the nuclear industry on a Friday to start working for the NDA the following Monday in a position to hand out large amounts of public money to people who were their colleagues two days before. That situation seems inappropriate, fails the

Minister's transparency test and brings into question the independence of the NDA. If he is keen to protect members of the NDA from the allegation that they are in the nuclear industry's pocket, that is not the way to act.

I am disappointed by the Minister's response, but I will not press the amendment to a vote. Like several other hon. Members, however, I shall raise at a later stage a number of tests to establish whether the NDA is independent, and I hope that at least some of them will have to be met. Otherwise, his objective as stated in clause 4, which is that the industry and the NDA should be seen to be independent of each other, will fail. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 75, in

clause 5, page 3, line 34, at end insert 'and the Welsh Assembly'.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

With this it will be convenient to discuss the following:

Amendment No. 119, in

schedule 1, page 151, line 36, at end insert 'and the Welsh Assembly'.

Norman Baker (Liberal Democrat, Lewes)

There are no Welsh nationalists on the Committee, so I am doing a job for them. That is the flippant point, but the serious point is that there is a need to ensure that within the democratic bodies of this country—this Parliament, the Scottish Parliament and the Welsh Assembly—there is ownership and acceptance of the NDA as it is established. That includes its key personnel. Clause 5 and schedule 1, the latter of which refers to removing people from office, indicate that the Secretary of State should consult Scottish Ministers, but there is no mention of the Welsh Assembly.

I accept that devolution means that this is a matter for the Secretary of State in England and Wales and for the Scottish Parliament in Scotland, and I accept the logic that led to the current drafting of the Bill, but I hope that the Minister accepts that the Welsh Assembly has a legitimate interest in how matters are progressed.

At important junctures in the NDA's life, including the appointment and removal from office of key personnel, it would be appropriate to take soundings from the Welsh Assembly. My amendment suggests not that it should be given a power of veto, but simply that, as a matter courtesy and involvement, it should be consulted. That does not seem unreasonable.

Michael Weir (Scottish National Party, Angus)

I want briefly to support the amendment. We do not have a Welsh nationalist here, so a Scottish one is near enough. On the face of it, there is consultation with Scottish Ministers, although I would have much preferred agreement, but there we go. The hon. Member for Lewes is right to say that the devolution settlement is different in Wales. He is also right to press this matter, especially as the Richard commission is considering extending the powers of the Welsh Assembly. It may well have these powers—in the not too distant future, I hope.

Stephen Timms (Labour, East Ham)

Hon. Members make the point that the exercise of functions under nuclear legislation differs between Scotland and Wales. In Scotland, some functions under the Nuclear Installations Act 1965 have been transferred to Scottish Ministers. Others were made to be exercisable in Scotland only after consultation with Scottish Ministers. In addition, the protection of the environment and the management of radioactive waste are devolved to Scotland. The hon. Member for Vale of York asked where we have got to on the procedures involving the Scottish Parliament. The Sewel motion has been passed and the Scottish Executive have agreed provisions that give Scottish Ministers powers of joint action on consultation rights that are appropriate to the devolved settlement on nuclear matters.

The position is different for Wales because much less has been devolved. Welsh Assembly officials were consulted during the preparation of the Bill, but they did not request that the Assembly should have powers under it. That is not surprising. There is little impact on devolved responsibilities in Wales. If something arose in the operation of the NDA that had an impact, the Welsh Assembly would obviously be consulted. I do not think it necessary to include that in the Bill or to incorporate the amendment relating to consultation on appointments. I hope that the hon. Member for Lewes will not press the amendment. The balance in the Bill correctly reflects the different responsibilities in Scotland and in Wales.

Norman Baker (Liberal Democrat, Lewes)

I am happy to have raised the issue. I hear what the Minister says and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 5 ordered to stand part of the Bill.

Schedule 1 - The Nuclear Decommissioning Authority

Laurence Robertson (Conservative, Tewkesbury)

I beg to move amendment No. 45, in

schedule 1, page 151, line 11, leave out 'five' and insert 'three'.

The amendment would reduce the appointment time of the chairman and non-executive members from five years to three. While I would be the first to recognise that we can argue for ever more about how many years it should be, I felt that five might be somewhat excessive, especially for a completely new organisation. I would welcome the Minister's comments and perhaps an explanation of why he feels that five years is appropriate at this point in the cycle.

Stephen Timms (Labour, East Ham)

The hon. Gentleman makes an interesting point. The NDA has a particularly long-term task. It will conclude contracts for the clean-up of its sites, which will be long-term contracts of about five years, with options for renewal. In that light, it makes sense to provide for similar continuity in the make-up of the NDA board. The Office of the Commissioner for Public Appointments allows for appointments to extend for up to five years. It is appropriate for NDA appointments to be able to be extended to that

maximum length, although the provision does not preclude briefer appointments if those were appropriate in particular circumstances.

The hon. Gentleman makes a fair point about the organisation being at its very beginning. It is likely that there will be different periods of service for people appointed to the board right at the start, if only to avoid wholesale change in its composition after the first terms are concluded. However, it is appropriate to allow for appointments of up to five years.

Renewal of NDA appointments is also provided for in the Bill, but we have made it clear that we will follow the guidelines of the Office of the Commissioner for Public Appointments, which allow for one reappointment and a maximum length of service of 10 years. Justified exceptions can be made, and we want to preserve that flexibility in case it is needed.

The points made by the hon. Gentleman are fair, but given the long-term nature of the task that the NDA faces and the contracts into which it will enter, five years is a sensible point at which to set the term.

Laurence Robertson (Conservative, Tewkesbury)

I am grateful to the Minister for his explanation. He makes a good point about the long-term nature of the work that the NDA will undertake and the consequent long-term nature of the NDA itself. I am happy to accept his advice on that matter. However, I am slightly concerned that he says he will follow the guidance on public appointments. I think he said that it is likely that there will be scope for only one reappointment and a maximum term of 10 years.

Stephen Timms (Labour, East Ham)

Except in exceptional circumstances. That is the norm.

Laurence Robertson (Conservative, Tewkesbury)

I am grateful to the Minister for that clarification. Paragraph 1(3) of the schedule states that

''a person is eligible for re-appointment (on any number of occasions)''.

There is therefore a slight discrepancy. There is an inconsistency between the Minister saying that he does not envisage an appointment continuing for longer than 10 years and the statement that people could be eligible for reappointment

''on any number of occasions''.

Stephen Timms (Labour, East Ham)

I am grateful to the hon. Gentleman for allowing me to clarify that matter. The legislation allows for extensions, as he suggests, but the Government's practice will be to conform with the guidance of the OCPA, which normally allows for two terms with the possibility of a further extension in exceptional circumstances. The legislation must allow for such extensions, but the Government will apply the OCPA guidance.

Laurence Robertson (Conservative, Tewkesbury)

I am grateful to the Minister for that explanation, which is now on the record. It might have been better to re-word paragraph 1(3) to reflect it and perhaps to say that an appointment would be for two terms, except in exceptional circumstances. That would have been clearer and more transparent.

However, I do not wish to extend the debate and therefore I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Laurence Robertson (Conservative, Tewkesbury)

I beg to move amendment No. 46, in

schedule 1, page 152, line 5, at end insert

'following consultation with the Chairman of the NDA'.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

With this it will be convenient to discuss the following amendments: No. 103, in

schedule 1, page 152, line 11, leave out sub-paragraph (3).

No. 49, in

schedule 1, page 154, line 9, at end insert—

'Limit on employment costs

6A The total cost of employment of executive and non-executive members of the NDA, including pensions, allowances and gratuities, shall not exceed £750,000 in the first year of its operation, to be increased in line with inflation each year thereafter.'.

Mr. Robertson: Amendment No. 46 is, in a sense, circular. It refers to paragraph 2, under which the NDA may pay to the chairman and to each of the non-executive members

''such remuneration and allowances as the Secretary of State may determine.''

It might therefore seem slightly odd to require the Secretary of State to consult the NDA about what it pays the chairman and the non-executive members, but I think it has been worth tabling the amendment.

Amendment No. 49 is more important, as it would place a limit on the employment costs of executive and non-executive members of the NDA. The Bill is in danger of creating a body with a great many highly paid people. The amendment therefore provides that the total cost should not be more than £750,000. We could argue about that figure, but I believe it is reasonable, although the Minister will probably say that there should be no figure at all.

What bothers me is what can be paid to executive and non-executive members. Apart from salaries, there are pensions, allowances and gratuities. I am concerned that the cost of running the organisation at senior level should not be allowed to run away. Briefly, I would welcome the Minister's explanation of how the cost of the NDA board will be financed. What percentage will it take of the running costs?

Stephen Timms (Labour, East Ham)

I think the proportion will be small. We expect the NDA's long-term programme to cost about £50 billion. In that context, the amounts of money we are discussing are quite small. However, I share the hon. Gentleman's concern to ensure the efficient and effective use of public resources.

Like other non-departmental Government bodies, the NDA will have to justify its administration expenses in its annual plan, which the Secretary of State has to approve each year. It does not make sense to impose a limit of £750,000 on the cost of the board. Even if that figure was right now, it is likely that it will

not be right in future. As I said, the authority's remit will extend for many decades, so the Bill stating a figure would be unhelpful.

As the hon. Gentleman said, it is odd to provide for a statutory consultation of the chairman for the chairman's own terms and conditions. Like the pay and allowances of other non-executive members, they should be a matter for negotiation between contracting parties rather than for statutory consultation, as amendment No. 46 provides. This is a matter of applying the normal arrangements that apply to public bodies.

Amendment No. 103 would remove the option for compensation to be paid to non-executive members should the Government wish to remove them before the conclusion of their term. It would be very unusual to rule out in statute the normal operation of existing contractual and employment law, which governs relationships between employer and employee.

On the hon. Gentleman's general point, I understand the anxieties often expressed about arrangements such as the seemingly over-generous golden parachutes, and I understand and share the concern about some practices that are applied elsewhere. We certainly do not want to enter into unnecessary obligations to pay compensation. The balance that we have struck in this part of the Bill reflects arrangements that apply elsewhere.

The hon. Gentleman asked about the NDA's running costs: we estimate that they will be between £25 million and £30 million a year. The board's costs on commencement are likely to be between £750,000, which he proposes, and £1 million.

Laurence Robertson (Conservative, Tewkesbury)

I thank the Minister for that response. His last sentence won me over, so to speak, because he concluded that the figure I proposed—about £750,000—is not too ridiculous. Given his sympathetic remarks on the need to control costs at the top of the organisation, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 125, in

schedule 1, page 154, line 11, at end insert—

'Public annual general meeting of the NDA

6A (1) The NDA shall make arrangements for a general meeting of the NDA to be held in public during the course of each calendar year.

(2) The NDA shall take all practicable measures to ensure that members of the public with an interest in the activities of the NDA are given reasonable notice of the meeting held in accordance with the provisions of sub-paragraph (1).'.

I mentioned three tests that I am seeking to apply to the NDA: transparency, independence and the reduction of the waste problem. The Minister appeared to sign up to those objectives when he talked about clause 4, and I hope that I can offer him many opportunities to show that he intends to adhere to them. Here is another one involving transparency.

Like the hon. Member for Tewkesbury, I am unsure whether the NDA is officially a quango, but it is quite normal for quangos to hold one meeting every year in

public as a sign of public accountability. The Minister will be aware that the theoretical line of accountability through the Secretary of State may satisfy constitutional propriety, but it does not necessarily meet those tests in reality. If he wants the NDA to be transparent, the amendment is a clear way to achieve that objective.

It is entirely uncontentious to ask the NDA to meet once a year, as such a meeting would offer an opportunity to present its programme, reflect on the work that it has done during the year, take questions and generally be accountable to the press, the public and Members of Parliament. Of course, we all accept that confidential matters, such as contractual arrangements, will occasionally arise, and it is normal in meetings for such items to be dealt with differently. There are no objections to that because confidentiality can be protected. It is sensible for the proposal to be taken further and I look forward to the Minister's positive response.

Laurence Robertson (Conservative, Tewkesbury)

I rise briefly to support the hon. Gentleman's amendment. One problem that the nuclear industry has perhaps had in the past—reference was made to it this morning, although I cannot remember which Member used this word—was its mystique. As we move forward and clean up various operations, the NDA must be seen to be transparent and work with members of the public. I cannot think what objection there should be to the amendment, but I am sure I am about to hear it from the Minister.

Stephen Timms (Labour, East Ham)

The White Paper made the point that the NDA should champion openness and transparency, and that it should help to dispel what I referred to earlier as the aura of mystery and mistrust, which has been so damaging to the nuclear industry's reputation. It will be important for the NDA to win public confidence through regular engagement with interested parties and communities, and we have made explicit provision to achieve that.

Clause 15(3), which we will come to later, requires the NDA to set out its objectives for stakeholder engagement in its strategy. That provision was added following comments on the draft legislation during a good process of consultation. When consulting on its strategies and annual plans, the NDA is also required to have regard to any representations made by the public, while its strategies, annual plans and annual reports will all be published, subject to appropriate exclusions. In the DTI, we have also been preparing a stakeholder engagement framework, which has been developed out of the two rounds of regional events that have taken place in the last year. The NDA will take on that framework, and develop and maintain it.

I completely agree with the concern to see that the NDA conducts itself openly and transparently to secure the public's confidence. However, it is also important that it has the flexibility to decide how best to fulfil its remit and deliver on its objectives more widely. Paragraph 10 of schedule 1 explicitly provides for the NDA to have flexibility in deciding its own procedural arrangements. Nothing in it rules out the

possibility of a public annual general meeting, but I believe that we can leave the NDA to make such decisions for itself. For example, the NDA may decide that it would be better to have several smaller, regional meetings rather than the one meeting that the amendment envisages.

Those outside the House will see from the record of our deliberations our general agreement on the desirability of arrangements along the lines of those set out in the amendment, although the question whether the NDA chooses precisely that or something else can be safely left with it. It will be essential that the NDA promotes a strong sense of public interest in, awareness of and confidence in what it is doing. Meetings of various kinds will help to achieve that.

Norman Baker (Liberal Democrat, Lewes)

When the Minister began and talked about championing openness and transparency and dispelling the aura of mistrust, I thought, naively, that he might be prepared to accept my amendment. He was certainly speaking along those lines. In the end, however, we have had every possible assistance short of actual help, although he has suggested that the amendment is jolly good without being one he can accept.

The Minister mentioned regional meetings, and it would be possible for the NDA to arrange such meetings under clause 15(3). Nothing in my amendment would preclude that, so his point is something of a red herring. However, I suppose that him saying that he agrees with the principle—or words to that effect—is as close as I am going to get to having an amendment accepted by the Government.

I look forward to the operation of the NDA, although it would have been helpful for the amendment to be accepted. It would not have tied the NDA's hands and prevented it from undertaking the consultation and achieving the openness that it wanted. A public AGM is normal practice, which is why I tabled the amendment in such terms, but in the light of the Minister's comments I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That this schedule be the First schedule to the Bill.

Anne McIntosh (Conservative, Vale of York)

I would like to have a small bet on schedule 1 standing part of the Bill.

I should declare a small interest, as the first constituency I fought was Workington in 1987. I was not as successful as my hon. Friend the Member for South-West Hertfordshire (Mr. Page), who represented Workington for the Conservatives in 1976. To paraphrase the Minister, the year 1987 falls somewhere between the Gas Act 1986 and the Electricity Act 1989.

Schedule 1 adds meat to clause 5, and I was taken by the information, which we received from the Minister in response to my earlier query, that the Sewel motion has been passed, allowing for joint action under a devolved settlement on nuclear matters. I want to press him further and ask under which particular legislation

that joint action has been agreed, as there seems to be a discrepancy as regards what energy matters are devolved to Scotland or reserved under existing law.

Under the Scotland Act 1998, all matters of regulation, apart from water, are reserved and therefore outside the competence of the Scottish Parliament, whereas under section 3 of the Electricity Act 1989 such matters are devolved to the Scottish Parliament. I am not familiar with energy matters relating to Scotland, so I have relied on a book by Cosmo Graham, ''Regulating Public Utilities: A Constitutional Approach'', which explores the subject in detail. Will the Minister tell us which legislation he is relying on, particularly with respect to nuclear energy?

According to paragraph 1(8) of schedule 1:

''Before exercising his power under sub-paragraph (6)'',

which refers to removing the chairman or a non-executive member from office,

''the Secretary of State must consult the Scottish Ministers.''

Has that also been agreed under the Sewel motion, or is it yet to be considered by the Scottish Parliament?

According to the regulatory impact assessment, the agreement of the Scottish Parliament is required. The NDA will have functions that relate to reserved and devolved matters, so it will have a similar status to a cross-border authority. What other cross-border authorities exist in the energy field? Schedule 1 sets out responsibilities that Scottish Ministers will have in relation to the operation of the NDA and to the arrangements to ensure the accountability, where appropriate, of the Scottish Parliament as well as Westminster.

Page 16 of the regulatory impact assessment states:

''Expectations are that the establishment of the NDA will lead to cost efficiencies over the medium to long term.''

The Minister informed my hon. Friend the Member for Tewkesbury that the annual running costs will be about £25 million to £30 million a year, with salary costs of £750,000 to £1 million a year. Schedule 1 sets out most of the NDA's set-up and operational costs, so where will the medium to long-term savings be made?

According to page 17 of the RIA:

''Primary legislation is required to set up the NDA to exercise statutory powers in respect of managing public sector nuclear liabilities and to provide a publicly accountable body subject to Parliamentary scrutiny for the spending of £50 billion plus of public money over the next 60-100 years''.

That is a firm commitment that the spending will be £50 billion plus. How does that compare with what the running costs of BNFL would have been? Would the costs cover the need

''to facilitate, if necessary, the transfer of assets vested in BNFL by the Atomic Energy Authority Act 1971 out of BNFL and otherwise enable restructuring of the company to take place''?

It would be helpful if the Minister shared that information with the Committee.

Stephen Timms (Labour, East Ham)

Sadly, I have not had the opportunity to read the splendid book to which the hon. Lady drew the Committee's attention. Essentially, the arrangements that I referred to, which are reflected in the drafting of the legislation in respect of Scotland,

were put in place under the Scotland Act 1998 when powers were devolved to the Scottish Parliament concerning parts of the Radioactive Substances Act 1993 and the Nuclear Installations Act 1965, which I mentioned. There is more detail about exactly what will happen in Scotland in clause 9, which we shall come to shortly. If the hon. Lady needs more detailed information on that topic, she can drop me a line and I will ensure that it is promptly provided.

The hon. Lady raises the question of where the savings are going to come from. I anticipate that the largest savings will arise from the introduction of competition to the selection of site operators, which is a core part of what the NDA can achieve. Evidence from the United States shows that substantial savings can be achieved by introducing such competition. We would expect to realise that objective. Precisely how great those savings will be is a matter for speculation, but they are likely to be significant given the large scale of the public spending—£15 billion—that we expect over a long period. Given the scale of that budget, quite modest percentage savings will add up to a lot of money. The creation of the NDA will be a helpful step in realising them.

Anne McIntosh (Conservative, Vale of York)

I am grateful to the Minister for his comments. I was quite specific, and perhaps we can explore the matter further under clause 9. It would appear that there is some discrepancy. I do not want to detain the Committee for long, but the Scotland Act 1998, to which the Minister referred, is specific on the point that all matters of regulation are reserved. I am not completely satisfied on that point, but we can explore it further in the context of clause 9.

Question put and agreed to.

Schedule 1 agreed to.

Clause 6 - Designated responsibilities

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 104, in

clause 6, page 4, line 11, at end insert

'and for a period of 12 months only in the case of any nuclear installation'.

Jonathan Sayeed (Conservative, Mid Bedfordshire)

With this it will be convenient to discuss the following amendments: No. 109, in

clause 12, page 10, line 18, at end insert

'consistent with the objective of decommissioning any operating plant at the earliest practical point'.

No. 112, in

clause 13, page 11, line 7, at end insert

'for a maximum period of 12 months'.

Norman Baker (Liberal Democrat, Lewes)

The Minister has told us about transparency and independence, so let us try him on the question of the NDA not generating excessive waste. I was interested in the Government's White Paper, which promised an annual report on the rationale for keeping open nuclear facilities, but that seems to have mysteriously vanished between the publication of the White Paper and the Bill. We are

used to party manifestos having policies of storm quality, which become heavy rain on reaching a White Paper and light drizzle in a Bill. That is what we have in this case—a welcome suggestion has disappeared in the mysterious period between the production of the White Paper and the Bill.

The matter is at the heart of the NDA's function. I naively thought that the NDA is there to help to deal with the environmental mess that the nuclear industry has created over many years and that its function is to decommission facilities and ensure that decommissioning is dealt with safely and sensibly, consistent with the good use of taxpayers' money. That seems to be the functions of the NDA put simply.

However, that is not what the Bill says, and I want to know why. For example, clause 6 says:

''The principal function of the NDA shall be to have responsibility for securing —

. . . the operation, pending the commencement of their decommissioning, of designated nuclear installations''.

The phrase that I am keen for the Minister to explore is

''pending the commencement of their decommissioning''.

Under the system, when a nuclear operator decides that its facility is to close—or, for whatever reason, the Government decide that it should be closed—the facility should become redundant and be handed over to the NDA to be dealt with. It is odd if something that has been handed over to the NDA can continue operating indefinitely, which is how I read clause 6. That is reiterated in clause 13(2), which says that the powers of the NDA include, in particular, the

''power to operate electricity generating stations''.

Why is no limit being put on the time for which the NDA would have that responsibility? Why is there not an annual reporting mechanism, as the White Paper proposed?

Does the Minister accept that the Bill as drafted would, in theory, enable the NDA to continue to generate electricity from those nuclear stations indefinitely? I am not sure that I can imagine the circumstances in which that would arise; nevertheless the Bill would muddy the waters between the NDA's finances and those of the nuclear industry, which generates electricity and waste. It also leads to an odd situation in which the NDA, which is responsible for dealing with our waste mountain, would, rather perversely, end up having to generate its own waste because it would be operating stations that produced waste.

As I understand it, clause 6 allows BNFL's ageing loss-making Magnox reactors to be operated by the NDA, apparently without time scale. It also gives the NDA power to operate the two reprocessing plants at Sellafield. We will come on to reprocessing as an aside in the next group of amendments, but suffice it to say that it would be very curious for a body designed to deal with nuclear waste to be the primary production method of that waste. That is the effect of clause 6 as I see it. Why do we not have a time limit on the operation that the NDA would be able to set for

stations that come under its control? That is the primary question that I hope the Minister will address in responding to the amendments.

Colin Challen (Labour, Morley and Rothwell)

I rise to seek further clarification on the first two sentences of clause 6, (1)(a) and (1)(b). First of all, I recollect that, on Thursday, my hon. Friend the Minister said that:

''the NDA's running of power stations will be limited, in the nuclear case, to the Magnox situation''.—[Official Report, Standing Committee B, 20 May 2004; c. 39.]

That is an existing situation. I want to be absolutely clear that the clauses will not empower the NDA to start decommissioning future new build power stations. It does not seem entirely clear that the clauses limit the NDA's responsibilities to Magnox power stations, especially as clause 6(1)(b) refers to:

''decommissioning of those and other designated nuclear installations''.

Will the Minister clear up that those responsibilities will be limited to extant nuclear installations?

Michael Weir (Scottish National Party, Angus)

I appreciate what the last speaker said. Later amendments will seek to achieve the same thing by a different route, because of the serious concerns that the NDA will, in effect, become a nuclear generator. Clause 6(1) says

''The principal function of the NDA shall be to have responsibility for securing—

. . . the operation, pending the commencement of their decommissioning, of designated nuclear installations''.

It is clear that it has the power to continue operating those stations. There is nothing in the Bill as it stands to say on what time scale those stations will be operating or, indeed, any strategy to set a time scale on their decommissioning. If they can operate until the commencement of the decommissioning, when does decommissioning commence? Does it commence as soon as the NDA takes over, or is there a time lag? Is it once the actual decommissioning has begun by the removal of fuel rods or whatever? There are many unanswered questions. We could have a situation where the NDA in effect starts running nuclear power stations and could become a generator.

I made that point in the Committee's first sitting, and the Minister was quite dismissive. When I raised it in an intervention, he said,

''I assure the hon. Gentleman that the NDA's running of power stations will be limited, in the nuclear case, to the Magnox situation, with a defuelling and decommissioning programme being established. The role of the NDA is about decommissioning.''—[Official Report, Standing Committee B, 20 May 2004; c. 39.]

The role of the NDA should indeed be about decommissioning. Allowing it to continue running the stations without setting out clearly a time scale bringing that to an end is muddying the waters in terms of the role. That could lead to confusion, to continuing of the nuclear legacy and, as has been mentioned, to making that nuclear legacy worse rather than trying to bring it to an end.

My one concern about the amendments, which I would be inclined to support, is the 12-month period. One of the problems of nuclear decommissioning is that it can take a long time. We have to be alive to that.

My own amendments try to place an obligation on the NDA when taking over a station to set a strategy for decommissioning that station. I have deliberately not set a time limit because every situation may be slightly different. If we set a statutory time limit of 12 months we could conceivably lead into problems if we are not able to begin the decommissioning within that period.

It is necessary to state clearly in the Bill that the role of the NDA is not about running nuclear power stations and that it will not be allowed to run nuclear power stations. I suggest that decommissioning should commence as soon as the NDA takes control of the nuclear power station and that a clear strategy and time scale are set at that point to avoid the confusion of continuing generation of waste by the NDA, which, supposedly, is to dispose of the historical waste.

Stephen Timms (Labour, East Ham)

The NDA is focused on decommissioning and clean up. Hon. Members who have spoken in this debate probably will have read the debates in the other place, where the Government consistently and firmly defended the position that the NDA is a decommissioning authority, not a commissioning or operations authority. There were moves elsewhere—we may come to them in this Committee, too—to change that. We firmly resisted them because it is our view that the NDA needs to have a clear brief about decommissioning.

All the operational responsibilities for the NDA are linked to that primary responsibility, either because they contribute to clean-up or because it is impossible to separate the operational elements from clean-up. As it is drafted, clause 6(1)(a) already restricts the NDA's powers to operate a nuclear power station pending decommissioning. The reason for that is to capture the Magnox stations—as hon. Members have rightly said referring to my remarks last week—which will be among the first sites to be designated to the authority. They are all due to be closed within five years of the NDA being established. The hon. Member for Lewes said that there was not a time scale for that, but there is. The last, at Wylfa, will cease operations in 2010.As drafted, the Bill allows the NDA to operate the Magnox stations during that period in order to maximise the benefits to the public.

Michael Weir (Scottish National Party, Angus)

I still have a concern. I understand what the Minister is saying, but the Bill says

''pending the commencement of their decommissioning''

and there is no time scale. Will the Minister give us an assurance that decommissioning will start as soon as the NDA takes over a station? The NDA could take over a station, but it might be a considerable time before decommissioning commenced.

Stephen Timms (Labour, East Ham)

The problem is that, by forcing closure within a year of designation, the amendment would mean quite significant revenue from a station's operation being foregone, with no benefit to clean-up. That may be the key point. The existing phased-closure programme for Magnox stations, which has been agreed with the regulators, is already optimised for managing the clean-up process. We cannot speed

it up by closing the stations early, because of capacity constraints at Sellafield. The Bill allows us to take forward the decommissioning of Magnox stations as quickly as possible given those constraints, while allowing some revenue to be earned in the meantime.

Norman Baker (Liberal Democrat, Lewes)

I understand the Minister's point about Sellafield. In tabling my amendment, I was not questioning the time scale for decommissioning Magnox stations; the date when they should finally shut. That is not the issue; the issue is the point at which they become the responsibility of the NDA and what the NDA does with them. I would argue that, if Magnox stations will be operational for another five years, the NDA should not be involved until later in the process.

Stephen Timms (Labour, East Ham)

No, I would resist such a constraint. It may well be appropriate for the NDA to take responsibility for those sites earlier so that, with regard to their management, the overriding concern of decommissioning can be in place as early as possible.

I have another point about the use of the word ''pending'', whose meaning has been queried. It could not extend to operating a power station, either new or old, if the clear aim of decommissioning was not in sight, even if an intended closure date had been established. That may help my hon. Friend the Member for Morley and Rothwell (Mr. Challen), given the question that he asked me.

The Government have no proposals for new nuclear capacity at the moment. The economics are wrong, and big questions about nuclear waste have not yet been answered. If there were a move towards new nuclear capacity in future, there would need to be consideration of the decommissioning arrangements. Nothing in the measure would exclude the NDA's having such a role, but that is certainly not envisaged in what we are discussing today.

With regard to the point made a moment ago by the hon. Member for Lewes, involving the NDA early—rather than leaving its participation to the later stages, as he suggested—will be helpful in making decommissioning as effective as possible.

Norman Baker (Liberal Democrat, Lewes)

Does the Minister accept that, under clause 6(1)(d), the NDA could be given responsibility for the two reprocessing plants at Sellafield as well as the Sellafield MOX plant?

Stephen Timms (Labour, East Ham)

The intention is certainly that the NDA should be able to take on responsibility for decommissioning the full range of civil nuclear sites in the UK. I think that that addresses the hon. Gentleman's question. With regard to the time scale to which the amendment refers, it would not be right to be more specific than we have been. The amendment would impose similar constraints on any other nuclear generating stations designated to the NDA in future. Lead-in times for decommissioning may change in future and we are talking about a period of up to 100 years. It may make sense for the NDA to take responsibility for a nuclear station at an earlier or later point in the preparatory stages of decommissioning to ensure the maximum effectiveness of the

decommissioning work. We need some flexibility in legislating on a process that will take many decades. In practice, it is hard to envisage the NDA being responsible for operating a station for much longer than the time that I have indicated would be associated with the closure of the Magnox stations.

The crucial point is that the NDA will only take responsibility for operating a station if the primary objective is to achieve successful and efficient decommissioning rather than to maximise operational revenues.

Michael Weir (Scottish National Party, Angus)

Is not the Minister muddying the waters? If the NDA's primary function is to decommission, why give them a function of operating stations at all? If there is planned closure of stations, the existing operators will plan to operate them until the closure date. Surely it makes more sense for the NDA and the existing operator to work hand in glove and for the NDA to carry out its primary function of decommissioning along with the operator. I do not understand why the NDA is being given the power to continue operating. That seems slightly bizarre. It muddies the waters and gives rise to the danger that the NDA will in fact become an operator of nuclear power stations rather than a decommissioning authority.

Stephen Timms (Labour, East Ham)

I do not accept the hon. Gentleman's point. Given that the objective is decommissioning, it makes sense for the NDA to take responsibility for the site at an early stage; not to wait till the very end when the station has been closed and only then come in to do decommissioning work. He envisages some arrangement whereby the two work hand in hand. Surely, he accepts that if the focus is to be on decommissioning, as in the Government's view it must be, the earlier the NDA is in the driving seat, the better.

Michael Weir (Scottish National Party, Angus)

I understand the Minister's comments, but that was not the point I was making. In effect, the Bill gives the NDA the power to become a generator. The Minister says that that would be for a short time, but that is not in the Bill. If there is a programme for closing stations—he says Magnox, but I believe that it covers any station—with the current generator still generating, why is it necessary for that generator to be let out of the loop and for the NDA to take over both generating and decommissioning? Surely, the principal object is decommissioning. The NDA could work with the generator, which would run down generation, while it dealt specifically with decommissioning and disposal or treatment of the waste.

Stephen Timms (Labour, East Ham)

The question is, which arrangement will be the most effective in terms of public interest? I am arguing that involving the NDA, giving it responsibility and designating to it earlier is a more effective way of accomplishing the task—it also includes an opportunity to earn some revenue while the station is still operating—than leaving its involvement until a later stage. The hon. Gentleman

has not suggested any reason why that should not be the case. I am persuaded that it is the case and that early NDA involvement is in the general interest.

Norman Baker (Liberal Democrat, Lewes)

At the Committee's first sitting, the Minister stated in response to the hon. Member for Angus (Mr. Weir):

''I assure the hon. Gentleman that the NDA's running of power stations will be limited, in the nuclear case, to the Magnox situation''.—[Official Report, Standing Committee B, 20 May 2004; c. 39.]

The Minister confirmed a few moments ago that, under clause 6(1)(d), the NDA will indeed be able to operate the two reprocessing plants at Sellafield as well the MOX plant. Which of those statements is inaccurate?

Stephen Timms (Labour, East Ham)

I do not believe that either of them is inaccurate. Clause 6(1)(d) does cover THORP and Sellafield's MOX project. We cannot separate such operations from the management and clean-up of the site shared facilities.

The hon. Member for Angus said that the temporary nature of the operation is not in the Bill, but it is. Clause 6(1)(a) refers to

''the operation, pending the commencement of their decommissioning''.

It is true that we have not said how many months that might take, but the temporary nature of such involvement is crystal clear in the Bill.

Michael Weir (Scottish National Party, Angus)

Is the Minister ready to define temporary? As a time scale, ''pending the commencement'' is completely meaningless.

Stephen Timms (Labour, East Ham)

It is not meaningless. It has a very clear meaning, particularly in the light of the fact that there is an existing time scale for all the Magnox stations to be closed by 2010.

Norman Baker (Liberal Democrat, Lewes)

I am not convinced by that and I intend to move to a vote because the Minister has been at his least convincing on the amendments before us. As the hon. Member for Angus rightly said, the phrase

''pending the commencement of the decommissioning''

is entirely meaningless. It could be at any point in the life span of the nuclear installations in question. The Minister also said that he was in the driving seat. He is not, for the very reason that he gave about the constraints at Sellafield and the fact that the Magnox stations cannot be decommissioned earlier because of those constraints.

We are faced with a situation in which the NDA in theory will decommission stations very quickly, but in fact will not be allowed to. Those stations will remain operative until at least 2010, during which time they will act as a generator and a producer of nuclear waste; at the same time as they are commanded by the Bill to deal with the problem, they will be adding to it.

The measures also blur the line between the generation of nuclear energy and the decommissioning of nuclear facilities. It is very important that those two are kept separate. The NDA must be seen to be independent. The Minister has said that he wants to see independence and transparency, but he is blurring those lines.

Notwithstanding what the Minister says, there is no certainty that the power stations will be decommissioned in 2010. They could go on for longer, and we have had a succession of due dates for decommissioning. The Magnox stations were supposed to have a life span of 25 years, but they have been continually extended. That may be the right position for those stations, but we can be no more certain of 2010 than we can of previous decommissioning dates.

Clause 6(1)(a) allows the NDA to go in very quickly after enactment and run the Magnox stations and the MOX plant for an indefinite period. That is stated in the Bill and the Minister has done nothing to clarify that or assuage me. He also creates financial uncertainty because of the relationships between the generator and the NDA in the operation of those stations. That introduces the question of the sensible use of public money and how accountable those involved are.

The Minister also fails to understand what he has said. I can assure him—I hope that he will look at this—that there is a conflict between what he said on Thursday 20 May, when he specifically stated that

Magnox was the only classification of nuclear installation to be dealt with by the NDA, and what he has admitted this morning in clause 6(1)(a). He must sort that out. I am not all happy with that and I intend to press for a vote.

Question put, That the amendment be made:—

The Committee divided: Ayes 2, Noes 11.

Standing Committee B

Energy Bill [Lords]

Stephen Timms (Labour, East Ham)

On a point of order, Mr. O'Brien. I would like to respond to a point made by the hon. Member for Lewes (Norman Baker) before the break. He suggested that there is an inconsistency between what I said on Thursday and what I have said today. I am pleased to reassure him that there is no inconsistency between the two points.

I made it clear last week that the Nuclear Decommissioning Authority will be able to run only nuclear power stations pending decommissioning. I made that point again today, and as I said, that will be the Magnox situation. The NDA will also operate thermal oxide reprocessing plant—THORP—and the Sellafield mixed oxide—MOX—plant for operational reasons, but those are not nuclear-generating stations, so there is no inconsistency between the points that I made this morning and those I made last week. If the hon. Gentleman looks again, he will, I hope, be satisfied on that point.

Bill O'Brien (Labour, Normanton)

We will deal with that as we make progress through the amendments.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 79, in

clause 6, page 4, line 16, leave out 'treating,'.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following amendments: No. 80, in

clause 6, page 4, line 18, leave out 'treatment,'.

No. 81, in

clause 6, page 4, line 27, leave out 'treatment,'.

No. 82, in

clause 7, page 5, line 43, leave out 'treatment,'.

No. 83, in

clause 40, page 35, line 7, leave out 'treatment,'.

Norman Baker (Liberal Democrat, Lewes)

Welcome back to our proceedings, Mr. O'Brien.

I am grateful to the Minister for having reflected on my comments over lunch, but I shall now deal with another problem that concerns me greatly: the use of the word ''treating''. That word has particular connotations for politicians, but in this case I am talking about a different context.

Laurence Robertson (Conservative, Tewkesbury)

Speak for yourself.

Norman Baker (Liberal Democrat, Lewes)

I certainly was not.

Clause 40(1) contains the Bill's definition of the word ''treat'', which,

''in relation to any matter or substance, includes processing and reprocessing (including any use as a material in a process for the manufacture of nuclear fuel)''.

Clause 6 effectively means that the NDA will be empowered to carry on the reprocessing of fuel.

We already know that the Government do not believe that they should intervene in that. In response to a written question from me, the Minister for the Environment and Agri-environment said:

''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.]

We know therefore that the Government have no policy to prevent the further generation of nuclear waste—reprocessing generates further nuclear waste—and that that is a matter simply for the industry. We could have a situation in which the Government are happy for the industry to generate increasing amounts of nuclear waste while the NDA runs around trying to stop that, although, as clause 6(1)(e) gives the NDA the power to treat, it may participate in the reprocessing.

Reprocessing is a particularly useless activity, which is more expensive than alternative spent-fuel management options. It magnifies the UK's nuclear waste management programmes, causes increased discharges of radioactivity to the environment and increases the UK's stockpile of weapons-usable plutonium. Plutonium is relevant to the question of treatment, so will the Minister say whether the Government regard it as a liability to be disposed of or a fuel still to be used? That is important, considering what the NDA will be doing.

We know that plutonium will separate from used fuel, and as I have mentioned, clauses 40 and 6 mean that the NDA may be involved in that process. However, such plutonium has no use any more. As the Trade and Industry Committee said,

''plutonium separated from used fuel is not only no longer required by any end-user, but is increasingly regarded as a positively dangerous waste product. Because of its physical properties and its potential attraction to terrorists or others seeking material for nuclear weapons, it has to be heavily shielded and securely guarded. The future disposal of the UK's current stockpile of separated plutonium, estimated to rise to at least 100 tonnes by 2010 if reprocessing continues, is currently under consideration.''

Every tonne of Magnox fuel reprocessed, which is what the NDA can be involved with under the Bill, produces 0.02 cu m of high-level waste, 1.2 cu m of intermediate-level waste, and 3 cu m of low-level waste. A tonne of spent advanced gas-cooled reactor fuel, when reprocessed, produces a much higher quantity of high-level waste—0.08 cu m—and the same volumes of intermediate and low-level waste. According to BNFL, the stockpile of spent Magnox fuel in March 2003 was 7,100 tonnes. If the reactors continue to operate, as the Minister wants, in accordance with BNFL's closure timetable, the amount of spent Magnox fuel that will require reprocessing before 2012 will rise to 9,400 tonnes.

Why is the NDA being given the power to continue reprocessing? The Government recognise the environmental liability of spent nuclear fuel and waste

to the tune of £40 billion, and have set up a special body to deal with it. Therefore, why do they not stop reprocessing rather than continuing to allow it to accumulate further waste, which the NDA will presumably have to deal with?

Richard Page (Conservative, South West Hertfordshire)

I must confess that when I read this series of amendments I thought they were probing. I am sure that you, Mr. O'Brien, will remember when probing amendments were discussed in Committee at great length, which enabled us to discourse on matters that were not always relevant. Timetabling means that we are more constrained and have to deal with the case in hand.

Having listened to the hon. Member for Lewes, I wonder whether the amendments are genuine, or whether, in the words of John McEnroe, ''You cannot be serious.'' I regard them as wrecking to the purpose and aim of the agency, which the Committee signed up to before lunch as a good thing. What the hon. Gentleman said was amazing. He could have achieved his intended aims with a more direct amendment rather than through the circuitous route that he has taken.

My hon. Friend the Member for Vale of York (Miss McIntosh) confessed to standing for the Workington constituency in a general election and kindly referred to the fact that I used to be the Member for Workington, until the generous electorate there allowed me more time to spend with my family. Like her, I visited the plant at Sellafield and became acquainted with the intricacies of the nuclear process and its problems.

I point out to the hon. Member for Lewes the fact that the operations of BNFL, including THORP, MOX and other commercial plant facilities, require an integrated process. We cannot hook out a word, as he has suggested, and expect everything to continue as normal—the whole process would fall apart. One cannot technically separate the natural decommissioning of the plant from the storage and disposal facilities by removing the word ''treatment''.

The hon. Gentleman's point does not stand up because, having searched through the amendments, I cannot see the corollary. Why, for example, did he not table a similar amendment to clause 19(1)(b) under which the NDA will have responsibility for

''the operation of a facility for treating . . . hazardous material''?

His amendment is technically defective. Perhaps, at a later stage, he will produce an amendment to remove the word ''treatment''. I apologise to the Minister, who might have to answer on that at a later stage, and to the Committee, for referring to it now.

The hon. Gentleman has tabled a wrecking amendment that would severely damage the work of the NDA. In doing so, he has offered no alternative on how the word ''treatment'' would flow through in respect of hazardous material. The amendment is anti-nuclear and designed to stop the NDA in its tracks. Although I seldom pray in aid the support of the Minister, I shall do so on this occasion in the hope that

he denounces the amendment as unworkable. I hope that the Committee as a whole, with the obvious exception of the hon. Gentleman, soundly defeats the amendment.

Michael Weir (Scottish National Party, Angus)

I want to make a brief point. The hon. Member for South-West Hertfordshire (Mr. Page) is dismissive of the amendments, but the definition of ''treatment'' includes

''processing and reprocessing (including any use as a material in a process for manufacture of nuclear fuel)''.

That is the area that concerns me. Running through the Bill like a thread is an assumption, or at least a possibility, that the NDA will become a nuclear processor in its own right, although the Minister has denied that. However, this is yet another example of where that possibility exists, because the NDA is given the power to treat

''in a process for the manufacture of nuclear fuel''.

I am therefore inclined to support the amendment, unless the Minister can persuade me otherwise.

Nigel Griffiths (Labour, Edinburgh South)

Welcome to the Chair, Mr. O'Brien. Let the record show that, probably for the first time in my years in Parliament, I agree with the hon. Member for South-West Hertfordshire.

I shall answer the questions put by the hon. Member for Lewes directly. The amendment would prevent the NDA from taking responsibility for the operation of any nuclear facilities involved in the treatment of hazardous material. To remove the treatment of hazardous material from its functions would mean that it could not take responsibility for THORP, the SMP or Springfields, and would make the Sellafield site unmanageable in regulatory terms.

I realise that the hon. Gentleman's party is opposed to the continued operation of reprocessing at Sellafield. I also listened to what the hon. Member for Angus (Mr. Weir) said. Our policy on THORP and the SMP was set out clearly in the 2002 White Paper, ''Managing the Nuclear Legacy—a Strategy for Action''. There are existing contracts to fulfil, and decisions on the continued operation of the plant beyond those dates needs to be considered by this Committee and by Parliament.

We are committed to making decisions that are in the best interests of clean-up. In this context, the continued operation can be justified to the extent that it generates additional income or reduces the future costs of storage and the disposal of radioactive waste. Preventing the NDA from taking responsibility for the treatment facilities would not answer the question of what should happen to those facilities. The hon. Member for Lewes has asked me some questions. Let him tell the Committee how those facilities would be treated under Liberal Democrat policy.

Norman Baker (Liberal Democrat, Lewes)

Will the Minister tell me whether he thinks the objectives of the NDA are helped by allowing it to manufacture nuclear fuel?

Nigel Griffiths (Labour, Edinburgh South)

We are giving the NDA overall responsibility for the treatment. As the hon. Gentleman knows well, the complex treatment of nuclear facilities involves looking at the whole supply chain. We need an agency in which Parliament and the public have confidence. That is what we are presenting to the Committee in the clause. His proposal would greatly complicate the operation of the main Sellafield site to the extent that safety and security would be compromised.

The regulators strongly advise the Government that the integrity of the operation of the Sellafield site must be preserved in the interests of effective regulation. The facilities at Sellafield are so intertwined that it is all but impossible to separate THORP and the SMP from the rest of the site as the amendment seeks. As the site operator has to have unified control of the site, it makes sense for the NDA to have full responsibility for securing the operation and the clean-up of the site.

By giving the NDA responsibility for securing the operation of THORP and the SMP, we have a mechanism to ensure that decisions on the continued operation of these facilities are made on the basis that they maximise the net benefit to the clean-up of the site. The timing of ceasing operations can be made to fit with the overall strategy for cleaning up the site. Any income derived from the continued operation of these facilities can be put back into funding the clean-up. I urge the Committee to resist the amendment.

Sitting suspended for a Division in the House.

On resuming—

Norman Baker (Liberal Democrat, Lewes)

Belatedly, I welcome the Under-Secretary of State for Trade and Industry, the hon. Member for Edinburgh, South (Nigel Griffiths), to the Committee. The Minister for Energy, E-Commerce and Postal Services has retired hurt after earlier exchanges.

The hon. Member for South-West Hertfordshire said that my amendment is designed to stop the NDA in its tracks. It is not. It is designed to prevent the NDA from taking a role in reprocessing. Members of the Committee will have formed the opinion, perhaps from what the energy Minister said this morning and in earlier sittings, that the role of the NDA is to decommission nuclear installations, help to clean up the environment and deal with the nuclear legacy. That naive view is being undermined as we go through the Bill. We now know that the NDA will generate electricity from Magnox reactors and create nuclear fuel, under clause 40. That is a long way from the process of the NDA—

Nigel Griffiths (Labour, Edinburgh South)

Does the hon. Gentleman not accept that for the NDA to be effective and to advise on and master these issues, it should consider the entire

production and life cycle, not limit its remit to the end-product decommissioning issue, as the amendment seeks? The difference between our parties is that we want the NDA to be able to look at the life cycle through THORP, the SMP and Springfields in particular, so that the problems that arose because of the failure to consider the whole life cycle are resolved by the Bill. Thus, we will ensure that the NDA can look at the whole life cycle.

Norman Baker (Liberal Democrat, Lewes)

The Minister used the phrase ''look at'' several times. I am happy for the NDA to look at the whole life cycle but that is a different matter from taking responsibility for the generation of nuclear fuel, and it compromises his colleague's shibboleths of transparency and independence. In fact, it blurs the lines that I mentioned earlier.

The Minister gave the game away when he twice mentioned ''the income derived''; that is what the Bill is about. The nuclear industry has landed the Treasury with a gigantic bill for decommissioning and the Treasury wants some of its money back. It can do that by flogging the Magnoxes to death and trying to get some income from them, and reprocessing and getting some income from that. The Bill will generate waste rather than dealing with it, in order to get some income.

Michael Weir (Scottish National Party, Angus)

As there is no date for completion, could not the NDA become a generator in its own right for a considerable period?

Norman Baker (Liberal Democrat, Lewes)

That is right. We only have the estimate of when the Magnox reactors will cease operating. That date has been extended on a number of occasions and could be extended again. This is about money. To get its money back, the Treasury is trying to derive as much income as possible from the nuclear industry. However, that process will generate more waste and is completely contrary to the stated position and the stated objective of the NDA. I referred on Second Reading to the Minister's ''Consultation Paper on Proposals for Intermediate Level Radioactive Waste Substitution''. That means more waste. It means that at the same as the Government propose to get rid of waste through the NDA, they will create more waste, and they are doing so because they will derive income from the process.

I am afraid that NDA is beginning to stand for nuclear development authority rather than Nuclear Decommissioning Authority. However, I am happy to let the Minister dig himself into a couple of holes. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Laurence Robertson (Conservative, Tewkesbury)

I beg to move amendment No. 50, in

clause 6, page 4, line 30, at end insert—

'(3A) Such a direction must not be given by the Secretary of State before he has formally consulted the person in control of the site in question, and has laid a copy of that proposed direction before Parliament.'.

Bill O'Brien (Labour, Normanton)

With this we may discuss the following amendments: No. 51, in

clause 6, page 5, line 4, after 'every', insert 'proposed'.

No. 52, in

clause 6, page 5, line 5, at end insert

'at least a month before making such a direction, except in the case where the Minister considers the making of that direction urgent.'.

Laurence Robertson (Conservative, Tewkesbury)

I am not sure that I can quite match the excitement generated by the hon. Member for Lewes with his amendments; in fact, I am not sure that I am going to try.

In a way, it is a pity that we cannot discuss amendments Nos. 59 and 60 now, because they are the background to what I am getting at in these amendments. Amendments Nos. 59 and 60, if I may refer to them briefly, describe the position of British Energy, the relevance of which will become clear as I proceed. In speaking to amendments Nos. 50, 51 and 52, I am trying to show due respect to Parliament, in the sense that although the number of designations will be small, their importance will be large.

The Electricity (Miscellaneous Provisions) Act 2003 repealed sections 72 and 74 of the Electricity Act 1989, and gives the Minister the power to repeal to any extent any of the other provisions of part 2 of the 1989 Act by statutory instrument. As hon. Members will remember, the 2003 Act was introduced to rescue British Energy and, although small, was extremely wide-ranging. The Minister may want to correct me, but it seemed to give the Government the power to bring British Energy under state control, if that were desirable. The importance of that is that the NDA can take over only installations or sites that are publicly owned.

If the Government can take over parts of British Energy, that would become an organisation or an installation that could be taken over by the NDA. I think that I have interpreted the position correctly. Given that the Minister has such wide-ranging powers under the 2003 Act, and because any transfers will be very large in importance, it is not unreasonable to ask for the proposals to be laid before Parliament a month before they are enacted. That is not much to ask.

We have had an interesting debate on the future of Sellafield and, in particular, THORP and on the NDA's possible role in respect of reprocessing. In a parliamentary answer on 15 March, the Minister said:

''As far as spent nuclear fuel is concerned, THORP's order book amounts to some £12 billion.''—[Official Report, 15 March 2004; Vol. 419, c. 70W.]

That figure will probably alarm the Liberal Democrats greatly, but the point is that it is a massive sum and means an awful lot of work for the people in that area. Making transfers of that amount is very significant. It is not asking too much for the proposal to designate such a site to be put before Parliament a month before the transfer comes into effect, following the Minister's consultation with the site in question, which is also part of my amendment.

There is another aspect to this, which I mentioned on Second Reading. I do not know whether the Minister has had a chance to consider it, although I am sure that his officials will be up to speed on it, so no doubt he will be. If, for example, British Energy, or a

part of it, were taken over by the Government for the purposes of the NDA—to clean up or decommission—would that represent an infringement of European Union rules on unfair state aid? I am not saying that it would; I do not know and I am genuinely asking the question from ignorance, but it should certainly be considered. The relevance of that to the amendments is that if that occurs, it is only right and fair that Parliament should be warned about it in advance—[Interruption.] I am getting rather worried that the Liberal Democrat spokesman is agreeing with me, but I am sure that I can cope with that. For the reasons that I have given, I commend the amendments.

Nigel Griffiths (Labour, Edinburgh South)

To the surprise of many colleagues, the amendments appear to impose administrative burdens on the process of giving the NDA designated responsibilities. I should have thought that because 10,000 additional burdens were placed through regulations in the 10 years up to 1997, there would be no need to add unnecessary ones such as this. I am the first to believe that Parliament must be kept properly informed about processes, but are the Opposition arguing that it may be necessary to delay a designation, except in urgent cases, for a month or so that Parliament can reflect on it?

Designations are technical documents that specify precisely and in sufficiently robust legal terms what the NDA is being given responsibility for. Once the NDA has been given the designated responsibility for a new site, even if the designation has not yet come into force, it is required to update its strategy to take account of its new responsibilities. It will need to consult on a revision in accordance with the provisions of schedule 2, secure the approval of Ministers and publish the new strategy so that hon. Members, all interested parties and the general public will have the opportunity to view and comment on the new strategy. Its annual report will reflect any additional designated responsibilities. The report will be published and laid before Parliament, but the level of detail sought by the hon. Member for Tewkesbury (Mr. Robertson) in moving the amendments does not merit Parliament's consideration.

The additional requirement that the Secretary of State most formally consult the site operators is also unnecessary. Private sector operators must already consent to designations of their sites to the NDA. Public sector operators—BNFL and the United Kingdom Atomic Energy Authority—as site licensees of the nuclear legacy sites, will initially become the responsibility of the NDA as a matter of course. They will be heavily involved in the drawing up of designations relevant to them. I understand that work has already started on that. A statutory requirement to consult is unnecessary, and I urge the hon. Gentleman to withdraw the amendment.

Laurence Robertson (Conservative, Tewkesbury)

I am not entirely convinced by the Under-Secretary about how unnecessary the amendments are. I mentioned, for example, that THORP has an order book of £12 billion, just for reprocessing spent fuel. I am not aware of any transfer

of that size going through without some reference to Parliament. It seems extraordinary to want to avoid that. The Under-Secretary said that it would delay it for up to a month. Is he suggesting that designation will be made and acted upon within a month? That seems a very short time scale.

Norman Baker (Liberal Democrat, Lewes)

Did not the hon. Gentleman's amendment, which I support, also have the proviso that when it was urgent other action should be taken? Even that excuse does not hold.

Laurence Robertson (Conservative, Tewkesbury)

The hon. Gentleman is right. In another clause—I cannot quote it offhand, as I do not have the benefit of the Under-Secretary's civil servants—a designation can be made a long time ahead. What I am proposing is not extraordinary. With the proviso that I can speak briefly to amendments Nos. 59 and 60, which are linked to this proposal, I shall divide the Committee on this important matter.

Question put, That the amendment be made:—

The Committee divided: Ayes 6, Noes 12.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 78, in

clause 6, page 4, line 37, leave out from 'itself' to end of line 38.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following:

Amendment No. 59, in

clause 6, page 4, line 38, at end insert

'including the person in control of any installation, site or facility owned by British Energy'.

Amendment No. 86, in

clause 8, page 6, line 28, leave out from 'itself' to end of line 29.

Amendment No. 60, in

clause 8, page 6, line 29, at end insert

'including the person in control of any installation, site or facility owned by British Energy'.

Norman Baker (Liberal Democrat, Lewes)

In the last set of amendments, the hon. Member for Tewkesbury sought extra accountability and clarity. It is interesting that no matter where one stands on the nuclear issue, there is a common purpose in transparency and knowing exactly what is going on. That is why my hon. Friend the Member for Hazel Grove (Mr. Stunell) and I tabled the amendments. Clause 6(4) states:

''A direction must not give the NDA a responsibility . . . '',

and mentions some tightly defined groups:

''(a) a Crown appointee;

(b) the UKAEA;

(c) a publicly owned company;

(d) the NDA itself; or''—

it is something of a catch-all—

''(e) a person who has consented to the giving of the direction''.

That would appear to be anyone else on the planet, although the Under-Secretary will say that that is flippant. It seems unnecessary to include (e) in the terms in which the clause is written. If the Under-Secretary means British Energy, he should be upfront and say so.

In the debate on the previous group of amendments, the hon. Member for Tewkesbury rightly referred to the position of British Energy. Before we go further, one of the Ministers should make a statement on where that matter rests in respect of the European Commission. The Under-Secretary will know that the Bill will in theory allow the NDA to take on British Energy's liabilities, at an estimated cost of £3.3 billion over the next 10 years. Under the restructuring plan, the Government intend to underwrite the decommissioning and clean-up costs.

Officials from the DTI have admitted that the Bill is worded to cover British Energy's liabilities; it would also allow future private nuclear companies to be bailed out in respect of their waste and decommissioning liabilities. We are not, as hon. Members envisaged at an early stage, drawing a line under the issue, dealing with historical liabilities and trying to move on with a clean balance sheet. We are doing worse than that in a sense.

I agree that we should have the NDA, but we are allowing future private sector operators to offload their responsibilities on to the taxpayer. Is that the Government's intention? If the Under-Secretary wants to tell me that I have read the Bill wrong I will happily hear his explanation, but that is how I read it. It is contrary to the spirit of the Bill to allow that to happen. It is inappropriate for the Government to support a private sector company in that way. I ask the Under-Secretary to comment expressly on the complaint about the Bill that has been laid with the European Commission. Have his officials advised him that it is legal to go ahead in this form? If it is not legal my amendment should commend itself to the Committee.

Nigel Griffiths (Labour, Edinburgh South)

This group of amendments relates to the ability of the Secretary of State to give the NDA responsibility for securing the clean-up of private sector sites. We have made this provision in the Bill in recognition of the Government's ultimate responsibility for ensuring nuclear safety and security in the UK. We cannot rule out the possibility that the Government might need to step in to ensure the safe, secure clean-up of a private sector nuclear site. If that were necessary the NDA would of course be best placed, with its skills and expertise, to manage any clean-up operations. Clauses 6(4)(e) and 8(5)(e) allow for that, as long as the Secretary of State secures the consent of the private sector operator concerned.

Amendments Nos. 78 and 86 would simply remove that option, which, for the reasons I have just outlined, would be extremely irresponsible. The hon. Member for Lewes asks whether he has read the Bill wrong. The answer is yes, yes, yes, he has. He asks whether the Bill applies to British Energy. The answer again is yes, yes, yes, it does. His amendments Nos. 59 and 86 seek to emphasise that clauses 6(4)(e) and 8(5)(e) would apply to British Energy sites. That is entirely unnecessary. As drafted these provisions would apply to the ''person with control'' of an installation, site or facility, as defined in clause 39. That clearly includes a British Energy site.

Laurence Robertson (Conservative, Tewkesbury)

Before he concludes on that point, will he make a reference to the position with regard to the European Union's unfair state aid rules?

Nigel Griffiths (Labour, Edinburgh South)

The state aid rules would apply in this case. If the Government wanted to take responsibility for additional liabilities a further clearance process by the Commission may be required. I hope that clarifies the point and I hope that my explanation will persuade the hon. Member for Lewes to withdraw his amendment.

Norman Baker (Liberal Democrat, Lewes)

I will have to read Hansard. That was an extraordinary contribution from the Under-Secretary; frank, but slightly unwise. He has effectively said that the private sector will receive a blank cheque from the Government. The Government are prepared to pick up the bill through the NDA for private sector sites. All this business about the nuclear industry washing its own face and becoming self-sufficient is clearly codswallop. The taxpayer will pay yesterday, today and tomorrow for the nuclear legacy.

Richard Page (Conservative, South West Hertfordshire)

When the hon. Gentleman talks about the taxpayer paying for the nuclear legacy, he should remember the weapons programme that lasted for many a year. The civilian nuclear industry should not be included with that legacy.

Norman Baker (Liberal Democrat, Lewes)

I was thinking of British Energy in particular. I remind the hon. Gentleman that the electricity industry was told that privatisation would be a fresh start for the nuclear industry, would deal with all the liabilities, that the state would get all the Magnox stations and those that were going to be profitable were to be hived off into the private sector. Now, dare I say it, a Labour Government are coming forward with a blank cheque to clear up those sites.

Laurence Robertson (Conservative, Tewkesbury)

I fear that the situation might be rather worse than the hon. Gentleman describes, given the Under-Secretary's honest reply to my intervention. We do not know whether they can clear the sites or not. Would not it have been better to clarify that before publishing the Bill?

Norman Baker (Liberal Democrat, Lewes)

I could not agree with more with the hon. Gentleman. It is intolerable that the Committee is being asked today to give a power to write a blank cheque for the future of a private company, possibly in

contravention of European Union rules. That is what we are being asked to agree to this afternoon. The Under-Secretary and his colleagues must reflect on their position on the Bill.

This morning, I had a BNFL advert that talked about a brand new start; it was rubbing its hands at the opportunities that now exist, and I am sure that British Energy is doing exactly the same. This is a wonderful start for those companies. They can offload all their present and future liabilities on to the taxpayer, and can continue to do what they should not be doing, in my view, which is to generate more radioactive waste for the taxpayer to deal with.

The Under-Secretary said that there was a guarantee that the consent of the private sector must be secured, but the private sector will be falling over itself to give consent to the Under-Secretary in those circumstances. He also said that I may have misread the Bill; I may have done so, but in his contribution, he confirmed the understanding that I had mentioned earlier. The hon. Member for Angus has a later amendment, which seeks to delete from clause 12(2) the ability to help British Energy in that way.

I hope that when we reach that point, the Under-Secretary will have reflected on this debate, and will be able to give a more definitive statement on the European position. The idea that we can put into law something that may be contrary to European requirements is, frankly, astonishing. The Under-Secretary has some serious questions to answer. However, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 77, in

clause 6, page 5, line 20, leave out 'against the interests of' and insert

'constitutes a material risk to'.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following:

Amendment No. 110, in

clause 12, page 10, line 47, leave out from 'information' to 'national' and insert

'the publication of which would constitute a material risk to'.

Amendment No. 111, in

clause 12, page 11, line 1, at end add

'the publication of which would constitute a material risk to national security'.

Amendment No. 126, in

schedule 2, page 161, line 34, leave out

'be against the interests of'

and insert

'constitute a material risk to'.

This is rather less controversial, although still important. I and my hon. Friend the Member for Hazel Grove tabled these amendments with a view to getting the balance right between proper regard being paid to national security and the issue of the public at large knowing what is taking place in their name. The test set under the Bill for the release of information is slightly too widely drawn. My amendment would be a more satisfactory replacement. The term

''against the interests of national security''

can be interpreted rather widely, whereas the replacement wording

''constitutes a material risk to''

national security is fairer and tighter. It does not prevent anything being withheld that is a genuine threat to national security, but recognises the principles enshrined in the Government's freedom of information legislation, which is that information should be released unless there is a good reason not to do so. We tabled the amendment to endorse the Government's approach to freedom of information, so I hope that they will support it.

Richard Page (Conservative, South West Hertfordshire)

I would describe the amendment as a true probing amendment in the traditional sense. It warms the cockles of my heart to see such an old-fashioned amendment; it makes me feel at home in this new age.

I shall resist the temptation to discuss the intricacies of the amendment in detail. The amendment is unsound, but interesting. The Under-Secretary must accurately define what the Government mean by national security. In practice, the amendment is similar to medieval philosophers trying to decide how many angels could dance on the head of a pin. No Secretary of State will publish detailed information that could affect national security, especially after 9/11. It is exceedingly doubtful whether anyone can define what constitutes a less than material risk to national security. The Under-Secretary is one of the more open Ministers that I have met. He prayed in aid some of my comments earlier, which makes me warm to him in a way that I would not normally do. However, in these days of open government, it would be helpful to know where the lines of publication lay.

The background of the interpretation of national security could be obvious, simple and unworthy of query. However, I remind the Committee of a recent incident in which a young lady at Cheltenham breached the Official Secrets Act, published information that was a clear contravention of that Act and yet was not prosecuted. Mr. O'Brien, you would rightly pull me up if I went into the details of that case, so I shall not do so in deference to your position as Chairman. However, when the Government will not take action when there is a clear breach of national security, I must ask what the phrase

''against the interests of national security''

means.

We have a new Labour Government with new policies but, as far I am concerned, national security is still national security. I have signed the Official Secrets Act as, I would suggest, has the Under-Secretary, but it seems that people are no longer bound by it and cannot be prosecuted. He and I are working as one on the Bill at the moment. Will he tell us exactly what national security is, and where it will be influenced and implemented?

Robert Key (Conservative, Salisbury)

Will my hon. Friend tell the Committee why he signed the Official Secrets Act?

Bill O'Brien (Labour, Normanton)

Order. I would certainly suggest that we do not go into that.

Richard Page (Conservative, South West Hertfordshire)

Shades of the past, when a colleague would intervene to help an hon. Friend who was drying up by giving him a little line and keeping him running on a new thought. I will not say why I signed the Official Secrets Act, except to say that I am a loyal citizen of this country; I wish it to prosper and would not want information to be used by enemies of the state to its detriment.

I hope that the Under-Secretary will define what he means by national security. To the uninitiated it may seem like I have put my question in a less than serious manner, but I am definitely serious. What goes on to the record from this Committee is used in legal actions and court cases to show what the Government mean. The hon. Member for Lewes has produced one or two wrecking amendments in relation to the NDA, to which I objected. I assume that this amendment is a true probing amendment and that he wishes the Under-Secretary to define what he means by national security. I should also like to know what is meant by national security, and I look forward to the Under-Secretary's comments.

Nigel Griffiths (Labour, Edinburgh South)

The amendments would reduce the Secretary of State's ability to withhold sensitive information by applying a different burden of proof from that required under the Freedom of Information Act 2000.

Let me give an example of what could be relevant to national security. We all know that nuclear sites can contain security-sensitive material and information and in the current environment, there obviously must be some discretion and control over the use of that information, in the public interest of avoiding it being used to potentially damaging effect and ensuring that it comes under some scrutiny. As I have said, even the Freedom of Information Act does not set out the test that the amendment proposes. For the purpose of safeguarding national security, it allows Ministers to determine what information should be exempt to safeguard national security.

I should have thought that, now more than at any other time in the past, there is not a strong case for introducing a materiality test that would reduce the Secretary of State's discretion to exclude information to be published on grounds of national security. I know that the hon. Member for Salisbury (Mr. Key) stepped in to try to help fill the vacuum in his hon. Friend's head, but on this occasion, he was not successful. I recommend that the amendment be withdrawn.

Norman Baker (Liberal Democrat, Lewes)

The Under-Secretary spoke about the threat. Yes, there is a threat, and we all have to recognise that. He talked about discretion, and yes, Ministers should have discretion on such matters. He also talked about control, and yes, there should be control. None of those points is queried or threatened by the amendment.

The Under-Secretary's substantive point was to identify, rightly, that I am proposing to apply a different threshold from the one in the Bill. That would

be the only change; the amendment would not remove the discretion or control and would still allow Ministers, if there is a material risk, to keep information secret or deal with it as they think appropriate. None of that would change. The amendment tests simply whether the hurdle is the right height. Ministers will always err on the side of caution, particularly in times such as these, and we would expect them to do nothing other than that.

The Under-Secretary's portrayal of the amendment was somewhat unfair. I also believe that as there are public safety and environmental issues with nuclear waste and power stations, it is legitimate to ask him whether we are striking the right balance. I will not press the amendment to a Division, but I ask him to recognise that it was a reasonable point to make. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Anne McIntosh (Conservative, Vale of York)

I welcome you to the Chair, Mr. O'Brien.

I have several points to make. My hon. Friend the Member for South-West Hertfordshire referred to the nuclear capacity of Ministry of Defence installations and said that he would not want the new authority to have responsibility for them. Paragraph 59 of the helpful explanatory notes informs us:

''Clause 6 is framed in general terms so that, in addition to the BNFL and UKAEA sites described in the White Paper, the Government could in future give the NDA responsibility for the decommissioning and cleaning up of Ministry of Defence sites''.

The Under-Secretary's constituency encompasses Morningside, so he will be some distance from a nuclear power station, whether civil or MOD. However, will he tell us how likely is the scenario that was rightly identified by my hon. Friend? We may wish to return to that point.

Richard Page (Conservative, South West Hertfordshire)

My hon. Friend is right in asking that question of the Under-Secretary; it is important that that should be put on the record.

The point that I was making was that there is a huge nuclear legacy through the weapons programme and that some people desire to amalgamate that into the civilian situation. It is important to ensure that the civil liabilities are not burdened with the requirements that have to be dealt with from the weapons programme. Many people try to roll together the civil and weapons nuclear liabilities, which I do not believe to be fair.

Anne McIntosh (Conservative, Vale of York)

The Committee will have some sympathy with the points made by my hon. Friend. I hope that the Under-Secretary will take account of them in his response.

The Government consulted over a four-month period from the end of November 2003 to February of this year on the decommissioning policy, with particular reference to decommissioning the UK's nuclear facilities. The Government's helpful summary of the responses to that consultation document

pointed out that although all respondents agreed on the need for site strategies covering decommissioning operations, concerns were expressed that options should not be foreclosed and in particular that the relationship between the strategies of the NDA and those of its site operators should be clear and unambiguous. I share some of those concerns, but clause 6 is silent on that point. Have the Government reached a conclusion with regard to those relationships, and at what point in the Committee will we be able to discuss that matter in more detail?

I should perhaps declare an interest in relation to subsection (7). Some rather derogatory remarks were made this morning about lawyers who were members of the Committee. I plead guilty to being a member—albeit non-practising—of the Faculty of Advocates, which is why I retain an interest in how Bills passing through the House relate to Scotland as well as England. As you will be aware, Mr. O'Brien, my constituency is almost equidistant between Edinburgh and London; it is ideally situated in that regard.

Under subsection (7), the Secretary of State is required to lay a copy of every direction containing a designation before Parliament and to publish it, subject in both cases to the exclusion of any material which in his view, under subsection (9), should be withheld in the interests of national security. I should like to probe the Under-Secretary on that issue. Will directions be debated when laid before Parliament? If so, will they be debated by a statutory instrument Committee of this House, or could they be debated by both Houses? What will be the mechanism for such a debate? We seem to be expending a lot of energy this afternoon, for different reasons.

On clause 6(8), I should like to ask the Under-Secretary the same question as has been asked before to see whether it elicits any response or, indeed, a similar response to that of his colleague. I was fortunate enough to be able to question and seek the advice of the Advocate-General for Scotland on this issue when the Committee adjourned before lunch. That was a worthwhile exercise. It is just a pity that we have only five minutes in which to question the Advocate-General and to hold her to account.

Subsection (8) states:

''The Scottish Ministers must lay before the Scottish Parliament a copy of every direction which by virtue of section 9 is given jointly by them and the Secretary of State.''

However, in my experience, when decisions are taken jointly—for example, in a marriage—someone usually has the upper hand and the last word. I am pleased that my husband is not present on this occasion. Let us transfer that scenario to joint decision making by Scottish Ministers and the Secretary of State. Will the Under- Secretary be good enough to tell us which body and which Minister will have the last word?

The most alarming part of clause 6 is subsection (9), which states:

''The Secretary of State may exclude . . . from what he lays before Parliament and publishes under this section . . . anything the publication of which he considers to be against the interests of national security.''

I have not yet been asked to sign the Official Secrets Act, so I will not fall foul of its provisions, but could the Under-Secretary elucidate how strong a test will be applied in that regard?

I think that the Under-Secretary will guide me on one last point. I echo the words of my hon. Friend the Member for South-West Hertfordshire,. Having been a humble candidate at Workington and briefly seen the work at Sellafield, I pay enormous tribute to the contribution to the local economy that the plants in west Cumbria make. However, in relation to the designated responsibilities in clause 6, there will obviously be quite a dramatic reduction, through decommissioning, in the processing works in west Cumbria. Has that been noted and have Ministers taken action on it? Which part of the Bill would relate to that?

Desmond Turner (Labour, Brighton, Kemptown)

I should like to ask my hon. Friend the Under-Secretary a quick question while we are discussing this clause, which sets out the NDA's duties and responsibilities. In respect of the nuclear liabilities that were publicly created, and given that the NDA will be publicly funded to carry out its role, will he give a brief exposition of the Government's position on what would be the case were there to be a future generation of nuclear power stations that would presumably be privately funded? Would the private developers of nuclear power stations also have to fund privately their nuclear decommissioning liabilities?

Nigel Griffiths (Labour, Edinburgh South)

I shall reply to questions on the clause in the order that they were asked. The hon. Member for Vale of York asked about decommissioning policy and consultation. The review is under way, but it has not yet been concluded. The NDA needs to take account of it as the relevant Government policy.

It is unlikely that the NDA would have a role in MOD sites while there is still a defence interest, but as and when MOD interest in a sites ceases, it would make sense for the clean-up to be secured by the MOD itself. In Scotland and the UK, Ministers must agree that the Secretary of State acts on behalf of Her Majesty's Government in this matter, but the dialogue is very open and healthy between the Scottish Executive and the UK Government.

The hon. Lady almost got on to my Christmas card list with her mention of Morningside, which has a keen interest in the nuclear industry. We are grateful for the work being done in Morningside, through which waste from Torness is transported to Sellafield. It passes within a couple of hundred yards of my back door at Newington, and I am pleased that the freight line is kept up to passenger standard to secure safety there.

Unusually, the hon. Lady blotted her copybook when she called for more regulations, and for the designated directions to be discussed by the House of Commons and the House of Lords. The documents are technical; they specify what the NDA is being given designated responsibility for, and we do not intend

that they should be over-bureaucratised and debated in the way that the hon. Lady suggested. I am keen to have fewer regulations, not more.

My hon. Friend the Member for Brighton, Kemptown (Dr. Turner) raised an important issue. I shall ensure that he receives a reply, and that copies are sent to other members of the Committee.

Question put and agreed to.

Clause 6 ordered to stand part of the Bill.

Clause 7 - Additional responsibilities under designating directions

Anne McIntosh (Conservative, Vale of York)

I will be brief. I am very disappointed with the Under-Secretary's response and, particularly, the news that I will not be on his Christmas card list. I thought recognition of the fact that he was the Member for Morningside would have deserved that.

Conservative Members recognise the huge importance of scrutinising legislation. When a Bill calls for regulations to be laid before the House, it merely is an opportunity to inform the House and, possibly, to gain support for what the Government are doing.

The clause relates to additional responsibilities under designating directions. Subsection (2)(a) refers to ''research facilities'' and paragraph (2)(d) refers to

''facilities of any description situated in or on such other land.''

I understood that the Bill applies only to Crown land. Can the Under-Secretary confirm that all the land to which the clause applies is also Crown land or will there be circumstances in which land owned by other landowners may come into the equation?

The Under-Secretary mentioned the transporting of waste from Torness to Sellafield and through his constituency. Will the additional responsibilities under the clause cover such transport? In the responses to the consultation documents, concern was expressed about transport and the difficulties that operators experienced because of the absence of a management policy, particularly for intermediate level waste. Other concerns were expressed about the need for solid waste to be stored on site.

Could the Under-Secretary confirm that the additional responsibilities of the NDA will include the storage and transport of waste? One respondent to the Government's consultation exercise proposed that the Scottish Parliament should approve decommissioning policy in Scotland and said that there should be no movement of radioactive waste across the England-Scotland border. Does the Under-Secretary agree with those views or does he think that there should be free movement?

Nigel Griffiths (Labour, Edinburgh South)

I refer the hon. Lady back to clauses 6(4)(e) and 8(5)(e), which make it clear that the NDA will have the skills and expertise to manage clean-up

operations on publicly owned land. Those two clauses allow for private land to be similarly treated when the private sector operator concerned consents. It is inconceivable that the operator would not consent. Clause 7(2) limits the land and facilities under consideration to that owned or occupied by the person with control of a principal nuclear site. That sets the extent of the powers.

In answer to my hon. Friend the Member for Brighton, Kemptown, the clean-up of private sector nuclear sites is the financial responsibility of the operator concerned. It is possible for the NDA to be given responsibility for securing the clean-up of private sector sites, but the costs would continue to be borne by the private sector itself.

Finally, I can tell the hon. Member for Vale of York that it would not be our intention to see the nuclear waste going to the world-class facility at Sellafield from the Scottish stations to be held up at either Carstairs or the border while securing certification. Only someone who had not thought through the consequences of this serious matter would put forward such a proposal.

As far as I know, there is no proposal for Scotland to have an independent facility for safely disposing of expended nuclear fuel. There is common agreement on that among the Scottish Executive, the Government and anyone with a sensible point of view.

Question put and agreed to.

Clause 7 ordered to stand part of the Bill.

Clause 8 - Supplemental provisions of designating directions

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 84, in

clause 8, page 6, line 14, leave out 'may' and insert 'will'.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following amendments:

No. 85, in

clause 8, page 6, line 15, at end insert

'commensurate with an estimate of the financial liability being adopted by the NDA'.

No. 116, in

clause 13, page 11, line 35, leave out 'may' and insert 'will'.

No. 117, in

clause 13, page 11, line 36, at end insert

'commensurate with an estimate of the financial liability being adopted by the NDA'.

No. 118, in

clause 13, page 11, line 41, leave out subsection (4).

No. 99, in

clause 24, page 22, line 42, at end insert—

'(4A) In the case of a designated installation, site or facility where the person in control is not one contained in subsection (2), the NDA shall carry out an assessment of the ability of the person in control to cover the costs of the decommissioning and clean-up work, which the NDA considers necessary due to nuclear

contamination caused by the activities of that company, and present such an analysis to the Secretary of State, and the NDA, following consultation with the Secretary of State, shall then determine how the costs of the decommissioning and clean-up work shall be covered.'.

Norman Baker (Liberal Democrat, Lewes)

We have established that the NDA can take responsibility for the liabilities that arise from British Energy—that has become clear from our discussion on the group of amendments that included amendment No. 78. In response to an intervention from my constituency neighbour, the hon. Member for Brighton, Kemptown, the Under-Secretary said that the private sector would bear the costs of any clean-up. However, he said to me that we must give the NDA power to deal with the private sector because the Government are the body of last resort in the interests of security and the environment. We would all agree with that, so there is a conflict between the last-resort position that the Under-Secretary described to me and the categorical assurance that he gave to the hon. Member for Brighton, Kemptown.

Happily, the amendments in this group would help the Under-Secretary. Clause 8(2) refers to:

''A direction giving the NDA responsibilities in relation to an installation'',

including one in which

''the NDA is to have a financial responsibility under section 24''.

Under those circumstances, the direction ''may''—not will—

''require the person with control of the installation, site or facility''—

that could be British Energy or another private sector operator—

''to make payments to the Secretary of State.''

If the Under-Secretary genuinely intends the private sector to bear the costs of the clean-up, I can help him because amendment No. 84 would replace ''may'' with ''will''. That would absolutely clarify the matter. In addition to that, amendment No. 85 would add the phrase

''commensurate with an estimate of the financial liability being adopted by the NDA'',

which is exactly what the Under-Secretary is saying.

Michael Weir (Scottish National Party, Angus)

Is there not a problem that British Energy has had to be bailed out to the tune of many millions of pounds because it is uneconomic? What guarantee do we have that any future private sector operator will be able to make payments, unless there are segregated funds from the outset? Are we not giving out the ultimate blank cheque? The Government or the NDA will have to pick up the bill if any private operator is in the same position as British Energy was before the Government pledged money to it.

Norman Baker (Liberal Democrat, Lewes)

That is exactly right. The Under-Secretary giveth and the Under-Secretary taketh away, but recently he has been doing more giving than taking away in the nuclear industry. An amendment tabled by the hon. Member for Brighton, Kemptown dealt with segregated funds but it was not selected. I hope that we can return to that issue later because we want financial clarity; we do not want smudges and

blurred lines involving billions of pounds of public money, which is the situation that the Under-Secretary is creating through this Bill.

This is the ultimate blank-cheque clause. It tells a private sector operator, ''Don't worry about it. The Government are the body of last resort. If we get into trouble they will bail us out, as they have done in the past, and as they continue to do.'' The facilities that were made available to British Energy by the Department of Trade and Industry are still being made available. A huge amount has been made available in the past 12 months on that basis, and there is no guarantee in the clause that that situation will not arise again.

Indeed, clause 8 explicitly allows that to happen. Far from drawing a line under the use of public money to bail out the nuclear industry, which has happened so often, and starting with a clean sheet of paper, which I thought was going to happen under the Bill, we are perpetuating that practice. An opportunity is being provided for the private sector to have the Government contribute to its costs.

The hon. Member for Tewkesbury and his hon. Friends think that nuclear power has a future. If it does, I think that they are honest enough to say that it should wash its own face, and be clear on its financial contribution and accountability. That is not what the clause provides for. My amendments would prevent the taxpayer from effectively handing over more cash to British Energy.

Laurence Robertson (Conservative, Tewkesbury)

I want to speak briefly in support of the amendments tabled by the hon. Member for Lewes, and in support of my amendment No. 99. It relates to clause 24, which covers the financial responsibilities of the NDA.

It is obvious to the Committee, although I will restate it, that I do not come from the same position as the hon. Member for Lewes with respect to the nuclear industry. It has made a valuable contribution and there remains one for it to make in the future. However, I agree with him that it needs to be economic. I agree, too, with what I think he is getting at in his amendments. Certainly, amendment No. 99 is intended to ensure that where there is a liability—let us say that British Energy has a liability for waste, clean-up and decommissioning—there should be an obligation, as far as possible, to deal with that liability.

A conflict seemed to arise in discussion earlier. The Under-Secretary appeared, when I challenged him about the EU position, to be saying that the Government were prepared to bail out—in the words of the hon. Member for Lewes—the private sector in the nuclear industry. Otherwise, why were we discussing whether that would be unfair state aid? The Under-Secretary seemed to be willing that that should happen. Perhaps in some circumstances it might be necessary. However, it now seems that we are being told that it will not happen, but that it will be up to the licensee, the operator of the site, to pay. We need clarification. I thought so when I first read the Bill and, after the debate, I am even more convinced of it. Therefore I am happy to support the amendment.

Nigel Griffiths (Labour, Edinburgh South)

I am resisting the amendments—although I appreciate the clarity with which hon. Members have put very straightforward cases—because they would require private sector operators, as a matter of statute, in all cases to meet the costs of discharging their nuclear liabilities. We are clear about one thing: private sector operators must bear the costs of clean-up and should provide for them, for instance by using segregated funds. The question is what should happen if the operator fails—if the ''polluter pays'' principle fails, as it sometimes does in the real world. Circumstances can arise in which private sector operators are unable to meet their liabilities. British Energy provides a current example.

The Government are faced in those circumstances with a choice between leaving such an undertaking to founder and possibly collapse, or coming to its assistance for the good of our communities and of society. When it comes to discharging nuclear liabilities, there is no real choice: a responsible Government bear the ultimate responsibility for ensuring public safety.

What we have here is a Government proposal embedded in the Bill that takes that responsibility in full, compared with amendments that I fear would lead us down the road of irresponsibility. The irony is not lost on me, as the Under-Secretary with responsibility for nuclear decommissioning elsewhere. We have set up a half a billion pound fund, which is currently helping to dismantle Russian nuclear submarine facilities. I was in Archangel earlier this year to see how that was proceeding. We have a fund that is helping another nation meet the responsibilities that we must all meet as a world community, yet we are being asked here to accept amendments that would close the door on that in this country. That is why I reject them.

The clean-up of private sector nuclear sites is the responsibility of the operator concerned, so where the NDA is to be given responsibility for a private sector site, we would expect it to charge for that clean-up. Any decision to support a private sector operator in consideration of the Government's ultimate responsibility for the safe and secure clean-up of nuclear sites would be a matter for Government, not for the NDA. Such support, as in the case of BE, would, as I have said, be likely to be subject to state aid approval by the European Commission. I do not think that we can be clearer on the matter, and I hope that, having heard the consequences of the amendments, no responsible hon. Member or political party would want to walk away and leave clean-ups to the private sector in all circumstances. That is why I ask for the amendments to be withdrawn.

Laurence Robertson (Conservative, Tewkesbury)

I largely agree with the Under-Secretary, who made his case reasonably and persuasively. However, I point out to him that my amendment No. 99 is a little more accommodating than those tabled by the Liberal Democrats—although I support those too. My amendment took a slightly different line, which is why it relates to a different clause.

Clause 24 appears to suggest that the NDA cannot charge the private sector. That was my reading of it, which is why I tabled amendment No. 99, which says that

''the NDA shall carry out an assessment of the ability of the person in control to cover the costs of the decommissioning and clean-up work, which the NDA considers necessary''.

It goes on to say that the NDA

''following consultation with the Secretary of State, shall then determine how the costs of the decommissioning and clean-up work shall be covered.''

So my amendment would not have been in conflict with what the Under-Secretary very reasonably said. However, I accept his persuasive arguments, and I shall not push the matter to a vote, although it would not necessarily have been detrimental to the environment and public safety.

Norman Baker (Liberal Democrat, Lewes)

I follow the hon. Member for Tewkesbury and have equal sympathy with the point that he has just made and with amendment No. 99 in his name. The Under-Secretary's main argument against the amendments—that there is no provision for the Government to be the body of last resort—has some validity and I concede that he has a case. It is certainly the case that if a nuclear company went bankrupt and there were a problem, the state would have to intervene for environmental health reasons. That underlines the costs of the industry over generations to the public purse. However, the clause does not specify that the payment will not be required only under such circumstances. In fact, the clause is much looser than that and simply says that a direction

''may require the person with control . . . to make payments''.

We have heard the Minister's interpretation of that. Most people would agree that the state should intervene when an installation or a company goes bankrupt, but that is not what happened with British Energy in the last 12 months or so. He has referred to that case, in which the Government provided a substantial, fat lifeline to prevent the market from reaching the logical conclusion—British Energy should have gone bankrupt in the last 12 to 24 months. Had the NDA existed then, it could have stepped in and either run those stations, because the Government would have given it the power to be generator, or decommissioned them.

Instead, the Minister's policy is to allow private sector companies with nuclear generation capacity to exist. The Government have endorsed that philosophical decision, which was originally a Conservative policy. If the private sector is involved in the nuclear industry, however, surely it should take the risks. It is difficult to justify allowing the industry to receive the benefits of privatisation—money for shareholders and so on—but letting the risk remain with the state. That is the position the Government have constructed.

If the Minister proposes an amendment on Report that says that the requirement to pay on such directions will be made in all circumstances except

when the nuclear company in question has gone bankrupt—at which point the state must intervene for public health and environmental reasons—I will be sympathetic. I am afraid, however, that the clause's wording is loose and can be interpreted much more generously. Such has been demonstrated by what the Government have been prepared to do in the last 24 months.

Clause 8 is a blank-cheque clause. It is an opportunity for more state aid and for any nuclear company to hold a pistol to the Government's head and say, ''We are in financial trouble—we're going down the plughole unless you come up with some more money.'' Government Members ought to be aware that they will be voting for more state aid for British Energy or private sector nuclear companies.

The Minister has said that there is a requirement for a last-gasp body of last resort—the Government—in the event of a company going bankrupt. For that reason alone, I will not press the amendment to a vote. However, I shall table an amendment on Report that frames the provisions in such terms as to allow only failure to pay in the event of a bankruptcy and no other circumstances. If the Minister is true to his word, he will support it. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Laurence Robertson (Conservative, Tewkesbury)

In a sense, Mr. O'Brien, we have already discussed amendments Nos. 53 and 54. Amendment No. 54 refers to the revocation of a direction, but as I could not persuade the Committee to put directions before Parliament, I do not suppose that I am likely to gain support for putting the revocation of a direction before Parliament. Therefore, I do not wish to move amendment No. 53.

Question proposed, That the clause stand part of the Bill.

Anne McIntosh (Conservative, Vale of York)

The Minister will be aware that the tone of responses to the Government's consultation was overwhelmingly welcoming on the issue of funding arrangements for the NDA. However, two responses expressed concern about whether British Energy could afford to make its increased payments to the nuclear liabilities fund. How have the Government satisfied themselves that British Energy will be able to do so? The matter was alluded to when the hon. Member for Lewes commented on a company going bankrupt. Obviously, the company would have a serious concern.

To be frank, the clause, not having been amended, is not the most elegant or tidy. Will the Minister explain how it will work? Will it mean that work will be commenced only so far as funds are available to pay for it? Will it mean that an up-front payment will have to be made before the work starts or merely that a direction will require appropriate ongoing charges to be imposed by the NDA? Some guidance would be helpful. If authorisation is given for the work to start, would it proceed only to a predetermined interim stage

or could it all be concluded? I have read the responses to the Government consultation, and some real concerns were expressed.

The clause will empower the Secretary of State to make a number of directions. Every time we call for such directions to be scrutinised, we are accused of imposing a tier of regulation, but the fact that we privatised the energy sector and utilities should speak for itself. Will the Minister satisfy the Committee as to why, if the directions are in order, the Government are so afraid of parliamentary scrutiny? Is it not a concept to which the Government are wedded?

Nigel Griffiths (Labour, Edinburgh South)

I want to make a couple of points in response to the hon. Lady and the hon. Member for Lewes. We are faced with a choice: no state aid or Government intervention and funding in the public interest when they are needed. If that is the defining issue, we stand by the latter.

Much mention has been made of bankruptcy, and if the Government need to step in, doing so early to prevent a bankruptcy, as has been the case with British Energy, may be more cost-effective than picking up the pieces afterwards. This is not a case of, ''Where there is blame, there is a claim.'' A claim against a bankrupt company would be of little comfort to the public, the work force and all others who are concerned with public safety.

Norman Baker (Liberal Democrat, Lewes)

The Minister talks about the downsides of bankruptcy, but, as we have discussed, does he not accept that the Bill gives the NDA the power to operate nuclear stations? Therefore, there need be no effect on the work force, safety or security? Matters could carry on as normal; the only difference would be that we would not be paying out to shareholders.

Nigel Griffiths (Labour, Edinburgh South)

The question is, which is the best authority to maintain and run the specific site? I put it to the hon. Gentleman that there may have been a recent change of management, those responsible for the mistakes may have gone and the new team would be the best people to manage the facility, although, after NDA vetting, they may require financial support to do it. His amendments and his rejection of the clause would close the door on that, which is an important difference between us.

The hon. Gentleman is right, through the amendments he has tabled, to probe the Government on the exact meaning of the Bill, but he has clearly stated that he does not want any state aid to be allocated to the maintenance of such facilities. I do not know whether he has a response to my point: a new and highly experienced management, who have perhaps run another nuclear facility well, might be brought in by the company.

If the hon. Gentleman is arguing that in such a situation there is a clear choice between the NDA—a public body—running the organisation or public money going to a private sector organisation, even if that organisation has a good, proven track record, that exposes weaknesses in the amendments he tabled, albeit in good faith.

Norman Baker (Liberal Democrat, Lewes)

The Minister mentions a track record, which reminds me of Railtrack. Railtrack was a private sector company that the Government could not afford to allow to go bankrupt because it was delivering an essential public service—railways—so Railtrack repeatedly came back to ask for more public money.

Railtrack said that it had got everything sorted out and that the management had improved, which is what the Minister says, but in the end the Government had to pull the plug and say, ''No more.'' I suggest that as long as he allows that argument to be made by the nuclear industry—by private companies such as British Energy—those companies will keep coming back for more money. At some point, however, the Government will again have to say, ''No more,'' and hand the industry over to the NDA, as Railtrack went to Network Rail.

Nigel Griffiths (Labour, Edinburgh South)

There is an implication in what the hon. Gentleman says that there is some wonderful pool of experts available on tap who can come in and sort out the problems of the industry. In fact, although such expertise resides in the UK as much as anywhere else in the world, it resides in a core of key people. One cannot just advertise in the local jobcentre for people to come and take over such facilities.

It is therefore important that the clause stand part of the Bill, on the basis of the arguments that we have advanced. I recognise the sincerity with which the amendments were introduced, especially amendment No. 99, which I will briefly discuss.

That amendment would leave it to the NDA to determine how the costs of decommissioning and clean-up work should be covered, but I cannot support the removal of that responsibility from the Secretary of State. I do not think that a convincing case has been made for transferring those responsibilities to the NDA. Those functions should be kept clear and separate.

Laurence Robertson (Conservative, Tewkesbury)

The Minister refers to the amendment rather selectively. It states that the NDA shall

''present . . . an analysis to the Secretary of State, and the NDA, following consultation with the Secretary of State, shall . . . determine how the costs of the decommissioning and clean-up work shall be covered.''

Without that amendment, and the amendments tabled by the hon. Member for Lewes, the NDA—in other words, the taxpayer—could pick up the entire bill. I do not understand the Minister's objection to amendment No. 99.

Nigel Griffiths (Labour, Edinburgh South)

I do not wish to misrepresent the purpose of the amendment—members of the Committee have a copy of it—nor will I pick through it from a legal point of view. I do not disagree with the hon. Gentleman about the wording, but I was trying to focus on the outcome. The difference between us is that we believe that the Secretary of State, who is accountable to Parliament, should take the ultimate decision, rather than the NDA, no matter how valid the consultation with the Secretary of State may be.

Laurence Robertson (Conservative, Tewkesbury)

The Under-Secretary is extremely courteous in giving way. He is expressing great sympathy for amendment No. 99, although he cannot agree with all of it. Will he therefore reconsider it with a view to accepting a slightly amended version on Report?

Nigel Griffiths (Labour, Edinburgh South)

If the hon. Gentleman wishes the amendment to retain the last three sentences, which transfer the responsibility from the Secretary of State to the NDA, I will not be able to reconsider it. However, when we agree with them, my hon. Friend and I will look closely and sympathetically at all the amendments on Report.

Laurence Robertson (Conservative, Tewkesbury)

My point was not about leaving in those three sentences. It may be that we agree that the Secretary of State should have the ultimate responsibility, but the more important part of the amendment states that the NDA shall carry out an

''assessment of the ability of the person in control''

to pay for it. That is what I am getting at. Would the Under-Secretary consider accepting that point on Report?

Nigel Griffiths (Labour, Edinburgh South)

We will accept any amendment that significantly improves the Bill.

Question put and agreed to.

Clause 8 ordered to stand part of the Bill.

Clause 9 - Designations relating to scotland

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 87, in

clause 9, page 7, line 17, at end insert

'provided that this shall not be classified as intermediate-level-level waste or high-level waste'.

In the light of the Under-Secretary's last remark, I look forward to a positive response to my amendment. First, I can tell the hon. Member for South-West Hertfordshire, who is keen on this provision, that this is a probing amendment. It is an excuse to discuss a wider issue, but I hope that it is in order, Mr. O'Brien.

The hon. Member for Angus may be disappointed to know that my special interest is not in ensuring that radioactive waste is not disposed of in Scotland, although with my Aberdonian birthright I have a passing interest in that. I have tabled the amendment so that I can concentrate on intermediate-level and higher-level waste, and tease out from the Under-Secretary what is the delineation between the NDA and Nirex. I mentioned that point to the Energy Minister, but little clarity was forthcoming.

I want to clarify the matter because there is uncertainty about state aid, and about where Nirex fits in. We know from ministerial comments that have been reported in the press, which is always entirely accurate—The Observer, anyway—that there have been big clashes between the Secretary of State for

Trade and Industry and the Secretary of State for Environment, Food and Rural Affairs over the future and the role of Nirex.

The amendment would provide that disposal would not take place if it involved intermediate-level or higher-level waste. The point is whether the NDA will have the ability, or the authority if the Government have their way, to deal with the disposal of intermediate-level or higher-level waste. Nirex is charged with dealing with intermediate-level waste; that is its job. It is therefore developing a long-term strategy for the Government. Is that strategy to be undermined or overruled by the Bill?

This morning, the Minister for Energy, E-Commerce and Postal Services said that there would be some responsibility for the NDA in respect of intermediate-level and higher-level waste, but at what point does that responsibility stop and Nirex's responsibility begin?

Under clause 6(1)(d), the NDA will have responsibility for disposing of hazardous material. Many of us thought that that was Nirex's responsibility. The amendment would confirm the situation that I understand to be the case—that Nirex will deal with the disposal of intermediate-level and higher-level waste, and that the NDA can dispose of low and very low-level waste. If that is different from what the Government anticipate, I should be grateful to hear it. However, we certainly need clarification of the relative roles of the NDA and Nirex.

It would be helpful if the Under-Secretary could tell us what has happened to Nirex. We had a statement from the Secretary of State for Environment, Food and Rural Affairs last July. Since then, there has been a battle royal between the DTI and DEFRA. We have not yet had a statement on where that is going. Will the Under-Secretary clarify that while dealing with the other issues?

Richard Page (Conservative, South West Hertfordshire)

When I read the amendment, I experienced the puzzlement of trying to get into the mind of the Liberal Democrats, and I have to say that I failed. I came to the conclusion that if it was anything other than a wrecking amendment—in which case all became clear—I was in difficulty. However, the hon. Member for Lewes said that it was a probing amendment, so I feel a warm glow come over me. I am with him in spirit on that. I sincerely hope that he does not try to press the amendment to a vote, because I think that the whole thing would come off the road at that point.

The amendment is peculiar in the way in which it is designed to tease out the arguments that the hon. Gentleman asked the Under-Secretary to explain. I understand the requirement to define the relationship between the NDA and Nirex, and the amendment is more interesting because he has chosen to try to elucidate that information. However, the people who read these debates will wonder about the Liberal Democrats' moves to try to exclude Scotland from any form of nuclear activity. That would gain an enormous number of votes in some areas, but lose them in others. I see no reason why Scotland should be in the discriminatory position of being a nuclear-free zone.

Earlier, my hon. Friend the Member for Tewkesbury mentioned his away day to Finland. It is building a nuclear power station on a great chunk of granite. Scotland is just a lump of granite really, as the hon. Member for Angus—my hon. Friend—would admit. There are a few bits of water as well, but it is a great chunk of granite.

Michael Weir (Scottish National Party, Angus)

The hon. Gentleman obviously has not been to Scotland in a long time. There is a lot more in Scotland than granite. In fact, Angus is on sandstone, which is probably the most inappropriate material for a nuclear dump that I can think of. I would not argue that all nuclear waste generated in Scotland should be carted furth of Scotland, but if he is proposing a new nuclear dump anywhere in Scotland, he will find very great opposition to that proposal.

Richard Page (Conservative, South West Hertfordshire)

I have to say to the hon. Gentleman—he was my hon. Friend, but he has gone down a grade—that I was in Scotland last year. I took my dearly beloved, who is my wife as well, on an away day to celebrate one of our many wedding anniversaries. We had a lovely time going through what I have to say is the granite of Scotland. I am unaware of the sandstone of Angus, but if he would like a nuclear dump in Angus, that will be fine.

I shall return to the issue of Finland, because I could see in your eyes, Mr. O'Brien, that you were going to call me to order, and rightly so. I hope that no other hon. Member will try to distract me with irrelevances. However, Finland is working away to build its nuclear power station on granite. It is digging a spiral road to a depository at the bottom, so that all the nuclear waste goes down, underneath the power station. When the power station comes to be decommissioned, it will all be dismantled and put down into the centre of the granite. That will be environmentally safe and environmentally friendly.

As I said earlier, Nirex was about to announce a high-level waste depository in Cumbria, but the geological surveys indicated that the rocks there were not secure. There were fissures and faults in them, so the proposal was rejected in 1997. I am disappointed that the Liberal Democrats produce the fact that Scotland, with all the right geological aspects attributes to have a depository, would want, on the face of it, to opt out of that opportunity. As the hon. Member for Lewes said, this is a probing amendment, and it will be a challenge to the Under-Secretary to pull together his brief and answer the question.

Now that the Under-Secretary has stopped writing, he is obviously up to speed and is able to answer the question. I say that so that I can get back in his favour; he rejected the last set of amendments and gave me the brush-off, whereas I was his dear friend with the previous set of amendments. I hope that I am back in favour again, and should be interested to know how this probing amendment will demonstrate the relationship between the NDA and Nirex, which is an important one if we are going to move our nuclear installations forward to the future and, in particular, can make provision for their disposal.

Nigel Griffiths (Labour, Edinburgh South)

I have written a Christmas card with a second-class stamp. I welcome the opportunity to respond to the probing amendment and to make it clear that the future responsibilities for intermediate and high-level waste are under active consideration. That includes decisions on the future of Nirex. The Bill allows the NDA to play a role in the disposal of all radioactive waste. It can construct and operate disposal facilities, and it makes sense to keep that option open until the policy consideration is complete. I welcome the chance that the probing amendment gives me to spell out how the Government are tackling that issue.

Norman Baker (Liberal Democrat, Lewes)

I should have thought that, given time that the hon. Member for South-West Hertfordshire was extremely generous in giving the Under-Secretary to allow him to scribble his reply, we would have received a better answer than that.

The Under-Secretary has now admitted that there is no clear role for Nirex established in his mind, and no clear role for the NDA, although there will be some reserve ministerial powers. Nirex was going to be sorted out on 16 July 2003, when the Secretary of State for Environment, Food and Rural Affairs made her announcement, and the press release said:

''Margaret Beckett announces way forward on radioactive waste management''.

We are now wondering, a year later, what the way forward is. We know, however, that we are being asked to pass a Bill with all its provisions, without knowing the answer to the central question on the relationship between the NDA and Nirex. The more we consider this shiny new Bill, which was presented to us in glistening form on day one, the more the shine is wearing off. It is looking rather tarnished on a range of issues. There are more questions than answers in this Bill: this debate on the NDA and Nirex has provided us with another.

The Under-Secretary owes it to the Committee—and the House, on Report— to make a clear statement about what exactly is happening with Nirex, and how it will relate to the NDA. It would be an insult to Parliament if we were expected to pass the Bill and then have a ministerial announcement two weeks later stating the position. None the less, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Anne McIntosh (Conservative, Vale of York)

I wish to raise, in greater depth than I did previously, some small points on the relationship between the Bill and the way in which it will apply in England and Scotland. There has been talk about away-days to Finland. My next confession is that I am half-Danish and that on my annual holiday visits to Copenhagen, which was the family home in latter years, it has come as some surprise to see that the Swedes have positioned their primary nuclear plant

opposite the main centre of population and the capital of Denmark—bang opposite Copenhagen. I hope that the Committee will take note of that.

I hope that the Under-Secretary might have time to consider my remarks a little more fully than in the replies that he gave in other clause stand part debates. Subsection (2) draws a distinction, apparently not made elsewhere in the Bill, between licensable sites and other principal nuclear sites. It would be helpful for the Committee to know why that distinction has been made known just for the purpose of this clause.

I understand that directions for sites that are not licensable will be given jointly by the Secretary of State and Scottish Ministers. The Under-Secretary will have had time to reflect on the matter. I think that he has had a lapse of memory, which I am sure he will not readily be accused of, and has failed to respond to the point in earlier debates this afternoon. In the event of a joint decision when such sites are not licensable, who will have the last word? Is the Under-Secretary concerned that there may be discrepancies in the application of the Bill between Scotland and England?

This morning, the Minister for Energy, E-Commerce and Postal Services told us that one of the reasons that the Bill was to be welcomed was that it would introduce an element of competition between sites. Clearly, the clause has unique application in that regard. I am sure that the Committee will find it extremely helpful if the Under-Secretary could elaborate on why the Government appear to have moved away from the reserved matters. The little book tells us about all matters relating to regulation under the Scotland Act 1998—the Under-Secretary was not here for much of this morning, so I draw his attention to the little book ''Regulating Public Utilities: A Constitutional Approach'', written by Cosmo Graham, professor of law at the university of Leicester. It is available—or would be had I not borrowed it—in the House of Commons Library. However, I am sure that the Under-Secretary has the whole Department and its literature at his disposal. The little book says that all matters of regulation are clearly set out in the Scotland Act 1998, except waste, as reserved matters and are therefore

''outside the competence of the Scottish Parliament''.

I recall that I made my maiden speech on the Committee stage of the Scotland Bill, as it was then, and this is a matter in which I have had considerable interest. I think that there might be some confusion among members of the Committee—I could certainly be confused if the Under-Secretary does not satisfy me—and the wider public because the electricity provisions of section 3 of the Electricity Act 1989, as they have been applied, are clearly devolved. It is incumbent on the Under-Secretary to set out clearly before the Committee why these are no longer reserved matters but are to enjoy joint decision making.

Will such joint decisions be debatable, and if so in which forum? If an appeal were made against one of the decisions, under which authority or jurisdiction would the appeal take place? Presumably, the appeal

would take place before the Scottish courts, but my reading of the Bill does not elucidate that. Why does subsection (2) draw the distinction, which is not made elsewhere in the Bill, between licensable sites and other principal sites? In subsection 3(c), the Secretary of State, or the Scottish Minister is empowered to give the NDA

''responsibilities for the operation in or on a licensable site in Scotland of a facility for the storage of hazardous material''.

What specifically is meant by hazardous?

Nigel Griffiths (Labour, Edinburgh South)

My hon. Friend the Minister for Energy, E-Commerce and Postal Services dealt extensively and clearly with section 63 of the Scotland Act this morning and spelled out the division in responsibilities. I am grateful to the hon. Member for Vale of York for giving me the opportunity to answer her questions.

The distinction between licensable sites and other principal nuclear sites is to reflect the extent of the devolution settlement, which reserved matters relating to licensed nuclear sites. The Bill uses the concept of a principal nuclear site to ensure that sites requiring substantive decommissioning and clean-up work, but for which a nuclear site licence was not required—the fusion reactor at Culham in England is the only present example—are covered by the full range of duties and powers of the operator and the NDA. Only the operation of licensed sites is a reserved matter.

Our colleagues in the Scottish Executive find the arrangements acceptable. Clause 9 has been the subject of extensive discussion with the Executive to ensure that it properly reflects the devolved responsibilities of Scottish Ministers and the Scottish Parliament. Scottish Ministers are consulted, but that does not amount to a right to veto, although the process allows for the concerns of Scottish Ministers to be taken into account.

Scottish Ministers will have powers of joint decision and approval when the activities of the NDA relate to a devolved matter. If the activity relates to a devolved but also reserved matter, such as the non-processing, treatment and storage of radioactive waste on licensed or Crown sites, Scottish Ministers will have a right to be consulted. They will also be consulted on appointments by the Secretary of State to the NDA under clause 5.

The Bill reflects discussions between the UK Government and the Scottish Executive on the appropriate level of involvement of Scottish Ministers. The complicated nature of the provisions results from the way in which the various responsibilities of the NDA will be handled under the devolved settlement. In principle, sites that are licensable under the Nuclear Installations Act 1965 and Crown sites are reserved. Environmental protection and the regulation of the disposal of radioactive waste are, in principle, devolved.

Anne McIntosh (Conservative, Vale of York)

I am listening to the Under-Secretary extremely carefully, but I am becoming more confused. I fear that an action will be brought against one of the decisions taken under the clause. Have the Department or the Under-Secretary thought about

which jurisdiction would hear the case? He talks of not wanting regulation and scrutiny of directions to hold up matters in the House, but a court case would take substantially longer than getting it right in Committee.

Nigel Griffiths (Labour, Edinburgh South)

I am advised that if the hypothetical became reality and there were to be such a court case, the dialogue between the Scottish and English courts would ensure that the authority with jurisdiction over the matter would respond robustly. There is a good dialogue between the legal authorities of the Scottish Executive and those in Whitehall. I am advised that this issue, which hon. Members have rightly highlighted, is not the problem they believe it to be.

Question put and agreed to.

Clause 9 ordered to stand part of the Bill.

Clause 10 - Supplemental functions

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 88, in

clause 10, page 8, line 4, at end insert

'except that no monies shall be passed to those responsible for generating radioactive material'.

I am happy to say that this is another probing amendment, which should gladden the heart of the hon. Member for South-West Hertfordshire. I seek to unravel the financial relationship between the NDA and the private sector of the nuclear industry. I hope to get a fuller answer from the Under-Secretary than with my previous probing amendment. I must say that having one's probing amendments responded to in that way does not encourage one to table any more.

The amendment would amend the provision giving the NDA the function, so far as it thinks it appropriate, to promote

''the carrying out of research by others into those matters''—

those matters being the ''decommissioning of nuclear installations'', the ''cleaning-up of nuclear sites'' and so on. I seek to clarify whether the Government envisage a situation in which the NDA would pass money to British Energy or another private sector operator pursuant to that function.

If, as the Under-Secretary has stated, British Energy is responsible for its own clean-up operations, it ought to be dealing with such matters itself rather than relying on the NDA to fund its research. Will private sector operators fund their own responsibilities, or will that be another subsidy from the taxpayer to the private sector in the nuclear industry? If so, what are the constraints and rules? Is it simply a matter for the NDA's discretion?

Will the Under-Secretary admit that there is a need to clarify financial propriety between the NDA and the private sector? How does he intend to deal with that? What method will be deployed to ensure that public money is not spent improperly, that there is proper accountability for that money, and that we have the opportunity to follow such matters in the House of Commons and to raise matters of concern?

Any arrangement whereby billions of pounds of taxpayers' money is out of our jurisdiction due to commercial confidentiality because contracts have been signed would be intolerable.The hon. Member for Tewkesbury raised a similar issue earlier about billions of pounds that he wanted to be subject to scrutiny, which he rightly put to a vote.

This is another example of a situation in which taxpayers' moneys may be handed over to the private sector through the NDA, but in which we may have no way of following what the NDA is doing, or its reason for doing so.

Will the Under-Secretary clarify the relationship between the NDA and the private sector in terms of financial propriety, and tell us whether he envisages that the NDA will be empowered to subsidise British Energy for what is its responsibility—the carrying out of research for its own sites for which it has financial responsibility? If he does not clarify this point, I will raise it again in debate on a later clause.

Nigel Griffiths (Labour, Edinburgh South)

This is not a probing amendment. It is a wrecking amendment that would severely restrict the NDA's ability to spend money on promoting research carried out by others that is related to its functions.

I am interested in the hon. Gentleman's view of the world. On the one hand, he picks on an evil group of people who are running every nuclear facility and believes that they should not receive a penny for that, despite the fact that we have to ensure that the products of the nuclear industry are clean and made safe. On the other, he sees a group of academics or researchers—perhaps again found at the jobcentre—who would help to carry out the research that the NDA requires. It is simply not like that, and the amendment reflects that caricature fairly accurately.

Richard Page (Conservative, South West Hertfordshire)

I hesitate to intervene on the Minister. Now that I am on his Christmas card list I do not want to be deleted. The hon. Member for Lewes says that this is a probing amendment, from which one gathers that he will not press it to a vote. He would love to know what relationship the NDA is expected to adopt with the other private companies. To what extent will they be commissioned to do various works and how will money pass from one side to the other? Everyone agrees that they have to do this task and that work has to be undertaken and payment made. No one is against that. That gives the Minister a golden opportunity to explain how he sees this operating in practice.

Nigel Griffiths (Labour, Edinburgh South)

I welcome that intervention. The hon. Gentleman has clarified a good point that was put by the hon. Member for Lewes, which I will come to shortly.

The amendment would make it hard for the NDA to promote any research that could help it to do its job more effectively. It would rule out the possibility of the NDA funding research by most current operators and those involved in the nuclear industry, such as BNFL, British Energy and others. That is one of the reasons why we cannot accept the amendment.

The Committee is entitled to know how much information would be made public and how that would be done. The Bill already commits the NDA to a published strategy, an annual plan and an annual report. They will all involve extensive consultation, ministerial approval and publication. The budget will be disclosed to Parliament and be available for scrutiny there. No hon. Member or interested party outside will be hampered in scrutinising what is happening.

That openness will leave us open to the press releases from the Liberal Democrats and others saying, ''Shock, horror—the NDA has gone to some expert in the industry to help to promote research.'' Well, we heard it here first. I hope that will not come as a shock and nor should it when we are simply ensuring, by resisting amendment No. 88, that the NDA is not hamstrung in its function of promoting research. Nor should Parliament be denied the opportunity, through the annual report and other mechanisms, to see what research is being funded. All that is in the public interest. I hope, with that assurance, that the hon. Gentleman will withdraw the amendment.

Norman Baker (Liberal Democrat, Lewes)

As I said, this is a probing amendment. There is no such thing as a wrecking amendment from the Opposition because in this Parliament one would never get through. Such amendments could not possibly wreck anything, even if that was what they were designed to do. Amendments are either probing or making a point that, were the proposal agreed to, would achieve a beneficial effect.

The Minister is also wrong to represent me as characterising the nuclear industry as a collection of Dr. Nos—he does himself no service there. However, there is a need, to which I shall return, for financial clarity, particularly in this odd arrangement. In many respects, the nuclear industry is like no other. Inevitably, there is a close relationship between the NDA and the nuclear generators, whether they are in the private or the public sector. However, because of that relationship, and because of how the industry is constructed as well as its historical path to the point where it is now, it is particularly important that there should be financial probity, financial clarity and transparency. The Minister was good enough to agree with that point.

Earlier amendments that would have created some distance in terms of appointments to the NDA were rejected. It is possible that the NDA will pick up functions from the private sector and that it will hand over money for research to BNFL or British Energy. Such things might be justified individually, and the expertise in the industry should not be neglected—it might be useful in the decommissioning process. Nobody would argue with that. However, we should add those factors together and look at the overall picture in the context of an industry that is peculiar in that there is nothing in this country with which it can be compared. Also, it has an incestuous relationship

with the putative NDA and the generators. We should then check what measures are in place to ensure that public money is not improperly committed.

The NDA cannot be kept distant from the nuclear generators in the way that, say, the banking ombudsman can from the banking sector. I accept that such relationships are not possible in this case. Given those circumstances, what safeguards are in place? The Minister has spoken of an annual report and other such matters. Those are worth while and unexceptionable, but they do not meet the need. I have drawn attention to the points that I want to make, but the Committee should return to the matter of financial transparency and how it can best be achieved, and to the point about ensuring that moneys allocated for nuclear decommissioning are not spent on propping up the nuclear industry and further generation. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Michael Weir (Scottish National Party, Angus)

I beg to move amendment No. 24, in

clause 10, page 8, line 11, leave out subsection (2).

The amendment stands with some that we discussed in relation to clauses 6 and 8, and it relates to further clauses, particularly clause 82.

One of the difficulties that I have found with the Bill is that various clauses, although they are not strictly interrelated, point to the fact that we might have new nuclear build and new nuclear generators as a result of the Bill. I mention clause 82 because it gives the NDA powers in relation to generators that have previously been the property of British Energy but have been sold on to a third party. When I raised the matter on Second Reading, the Minister said to me:

''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.''—[Official Report, 10 May 2004; Vol. 421, c. 49.]

I waited with bated breath all through the wind-ups. Unfortunately, enlightenment came there none; it was not mentioned at all. That leaves us to question where we are in relation to the liabilities of both British Energy and any new nuclear generator.

I refer hon. Members to paragraph 80 of the explanatory notes on clause 10, which says:

''The function in subsection (2) is required as a consequence of the restructuring plan for British Energy (BE) under which the Government has given certain undertakings underwriting the cost of decommissioning and clean up of BE sites (subject to approval of the agreement by the European Commission). The intention is that, in order to safeguard the interests of the taxpayer, the NDA should have the capacity to act as the nominee of the Secretary of State under the terms of the agreements with BE and generally to ensure that BE's decommissioning plans and the basis on which it operates its stations and subsequently carries out decommissioning and clean up of its sites are such as to minimise any call on public funds. Subsection (3) enables the Secretary of State to require NDA to meet the costs of such an agreement so that all Government's responsibilities in respect of nuclear clean up can be managed within the same framework.''

That raises some interesting questions. It is somewhat hollow to say that the Bill will minimise any call on public funds, as it is clear from earlier debates that the Government are in effect giving a blank cheque for future nuclear decommissioning.

The Minister was pressed earlier by the hon. Member for Tewkesbury on the position with the European Commission. Press reports suggest that the Commission will approve the plans, but there is still the question of what happens with any future plans. If I heard correctly, the Minister said that the Government would have to go back to the Commission for further permission under the state aid rules. Will he clarify our exact position with the European Commission and whether there are plans to return to it?

The notes refer to ''all Government's responsibilities'', the clear implication being that the Government would take responsibility in any future nuclear build. We heard from the Government about the question of future nuclear build in debates on clauses 6 and 8. The Minister made a good defence of the need for the Government to be an ultimate authority, and I accept that. We cannot allow a nuclear generator to go bust and then walk away from it—that would be untenable.

We all accept that there must be a method of dealing with the clean-up of historic and any future nuclear waste. That is why every Committee member has welcomed the NDA—we recognise it is necessary. However, we do not agree on the question of new nuclear build and how it will be dealt with. I put it to the Minister that we should be dealing with historic waste and be sure about how we can move forward before we even consider any new nuclear build.

The Minister has told us that the Government must be the clean-up authority of last resort. That is fine, and previous clauses provide that they may require the person with control to pay towards the clean-up costs. However, there seems to have been no indication of a Government attempt to ensure that any new entrant to the nuclear market makes provision so that the clean-up costs can be met.

I refer the Under-Secretary to what the Trade and Industry Committee said in its 17th report:

''The White Paper gave an assurance that there would be no direct link between the NDA and new nuclear build. This assurance should be given force through a statement of policy by the DTI that approval of any proposal from the private sector for new nuclear plant would be conditional, amongst other factors, upon the establishment and maintenance of a segregated fund to meet the costs of clean-up at the end of its useful operational life.''

Nothing in the Bill enshrines that principle in law. I understand that the DTI has not issued such a statement, although, to be fair, a draft policy statement in the public consultation document on modernising the decommissioning policy states:

''The Government expects''—

we should note the word ''expects''—

''that all operators will take the steps necessary to ensure that their decommissioning work is adequately funded. No nuclear projects should be started unless it is clear that sufficient funds will be available to complete decommissioning in a safe and secure way, which represents Best Practicable Environmental Option for the site''.

I believe that we would all agree with that.

The Government say that they expect new entrants into the nuclear market to take the necessary steps to ensure safe decommissioning, but there is no requirement in the Bill to ensure that those steps are taken. That may be because the Bill does not say that there will be new nuclear build. I would oppose any such build, but the clauses that we have discussed in this and other sittings make it clear that such a build is possible.

When we discuss spending such vast sums of public money on dealing with British Energy and the clean-up of past nuclear generation, we should make it clear that no new nuclear build should be allowed unless there are segregated funds from the outset to ensure that money is available to clean up the site if anything happens to the new generators, and that it will not fall to the taxpayer to pay for such a clean-up.

A new nuclear station may start up; it is unlikely in the current financial circumstances, but things change. At first, all may look rosy, but if we do not ensure that funds are available, there is a risk that a new nuclear generator will believe that the Government will ultimately pick up the tab for a clean-up, because it knows that there is nothing in the Bill to force it to make provision to pay. The Under-Secretary may well say that there is a requirement in the Bill for the generator to pay these costs, but one cannot get blood out of a stone.

By its nature, a bankrupt company is a company that has failed. It is unlikely to have any assets other than the station itself. I wonder if that is not part of the reason why the NDA is given the option in other clauses to run such stations, because both Ministers have said that they could earn funds in that way. Ultimately, there is a blank cheque. At the end of the day, these people can walk away if their stations fail and there is no money. A limited company has nothing to go back to. I presume that there are no assets in those stations bar the stations themselves, so the Government, and ultimately the taxpayer, will fund all this.

I urge the Under-Secretary to consider this issue. The Government have pledged to bail out British Energy but if we are to make progress, these companies must be required to make due provision, and we must ensure that we do not run into another British Energy-type situation somewhere down the line.

Richard Page (Conservative, South West Hertfordshire)

I was not going to intervene on the hon. Gentleman, as he appeared to be reaching the end of his contribution, and it is not my job to sell the Government's position, but I put it to him delicately that he makes it sound as if a nuclear company can start up like some cowboy builder and say, ''We will knock up a nuclear power station down the road, and if it all goes bang, someone else can pick up the tab.'' If a nuclear power station of whatever description is to be built, it must undergo planning and detailed safety checks, and everything that is done must be given Government approval, otherwise the Government will pull the plug on it. As the Government would have

approved it all the way down the line, surely the situation that the hon. Gentleman describes is a little fanciful?

Bill O'Brien (Labour, Normanton)

Order. Before the hon. Gentleman responds, I have been listening carefully to his contribution and it contains a lot of repetition. I therefore ask him to introduce some new material, or to wind up his speech.

Michael Weir (Scottish National Party, Angus)

I take that stricture on board, Mr. O'Brien.

To answer the point from the hon. Member for South-West Hertfordshire, existing nuclear power stations went through a process of approval, but that did not stop British Energy going bust at the end of the day. He may say that it is unlikely, but it could happen; it could be avoided by amending the Bill.

Nigel Griffiths (Labour, Edinburgh South)

Who says that being a member of a Standing Committee is not an intellectual treat?

The Bill is not about new nuclear build. The NDA is concerned with clean-up arrangements. The Government have made it clear that it is for the market to take decisions on the economic viability of new nuclear build, including clean-up costs. Amendment No. 24 would remove the option to give the NDA the responsibility of acting on the Secretary of State's behalf in respect of agreements with third parties for decommissioning and clean-up activities. If the amendment were to be accepted, the NDA would not be able to act as a potential nominee on the Government's behalf in arrangements with those third parties. It would not change the Government's obligations, as the NDA would still have responsibility for securing the clean-up of public-sector nuclear sites. It will be the most appropriate body to take on the discharge of such Government obligations.

Much mention has been made of handouts and bail-outs. I shall share a secret with the Committee. The Chancellor privately may be a most generous man, but he does not like handing out public money to bail out anyone or any organisation. No blank cheques will be coming out of No. 11 at the eleventh hour under the present Chancellor. The notion that the NDA is a conduit of limitless public funds to the nuclear industry, with the Chancellor taking no interest in it, is ludicrous. Together with the safeguards that I have already outlined—the strategy, the annual plan and the annual report—that arrangement will serve us best. What more does the hon. Gentleman want?

Norman Baker (Liberal Democrat, Lewes)

This may be a rhetorical question. I am sure that the Chancellor is a canny man, which is why he wants the money being frittered away on the nuclear industry to be recouped if possible. He wants reprocessing as it gives an income stream.

The Under-Secretary says that the NDA is predominantly about decommissioning. That is its function, but at some point—this is allowing for Greenpeace—it might want the option to build and operate a certain type of nuclear power station, perhaps a plutonium-burning station, to dispose of part of the UK's plutonium stock pile. That would deal with the waste. Is not that a possible outcome for the NDA, and does it not have the power to do that if it wishes?

Nigel Griffiths (Labour, Edinburgh South)

The hon. Gentleman sets up so many Aunt Sallies that it is difficult to know where to start. I believe that the pro-nuclear and the anti-nuclear lobbies agree that the disposal of nuclear waste is a priority, and that we need a 21st century agency to handle that, and to do so with the confidence of Parliament and the public. The NDA is the agency to do that. Removing the option to give the NDA the responsibility to act on behalf of the Secretary of State, as amendment No. 24 would do, is not what people on either side of the nuclear divide want to promote; except, perhaps, the hon. Gentleman. I have already emphasised that the NDA cannot construct and operate a new nuclear generating station. I hope that that answers the hon. Gentleman's question.

I hope also that I have persuaded the hon. Member for Angus to withdraw the amendment.

The rest of the debate is in Hansard.