Clause 62
Energy Bill
6:30 pm
Steve Webb (Chair of the Election Manifesto Group, Cross-Portfolio and Non-Portfolio Responsibilities; Northavon, Liberal Democrat)
In his introductory remarks, the Minister addressed some of the concerns that I had on reading the clause. There was a worry about the potential for organising corporate structures to avoid the knock-on liabilities. He seems to be saying that there is a trade-off in such matters. A 20 per cent. threshold implies that if six parents share the ownership of a business, they can avoid the knock-on liabilities. If I understand him correctly, he seems to be saying that six companies would have so little control or power that they would not want to do that. However, perhaps they would if they knew that they could avoid their exposure to liability. I am not quite clear about his reasoning. I understand the point that the lower the threshold is set, the less control the parents or owners have, but I do not understand why there is not still an incentive to structure the ownership in that way. Will the Minister clarify that point?
The hon. Member for Wealden made an important point about the inconsistency with clause 77 on oil and gas, for which the threshold is 50 per cent. There is clearly a different figure in this clause, and it would be interesting to know why it should be different for nuclear compared with oil and gas.
I apologise for what is probably a lack of understanding on my part, but will the Minister explain in lay terms how in this clause the 20 per cent. and 50 per cent. numbers relate to one another? One appears to relate to direct ownership and the other to indirect ownership, but indirect through what mechanism? Is it a holding company, a parent company or something else? Will the Minister clarify what the two different numbers are exactly? More to the point, why is 20 per cent. right for one and 50 per cent. right for the other? He explained what they were, but not necessarily why 50 per cent. was right for the other.