Wales Bill - Report (1st Day)

Part of the debate – in the House of Lords at 7:00 pm on 14th December 2016.

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Photo of Lord Wigley Lord Wigley Plaid Cymru 7:00 pm, 14th December 2016

My Lords, here we go again. I rise to move Amendment 36 and to speak to Amendment 37, which is coupled with it. I shall speak to Amendment 60 a little later.

I welcome the Minister’s acknowledgement in the previous stage of the Bill that the limit placed on energy projects is in fact arbitrary. However, he failed to outline in any way why such a low arbitrary limit is necessary. I am sure that I will catch his eye, or his ear, in a moment so that he will be able to respond to that point in due course. The Minister rightly made the point that if you have to put a limit somewhere it will always, in some respects, be arbitrary. An obvious solution is to remove the limit altogether, as is the case in Scotland. Does he not think it bizarre that the Government are happy to use words such as “arbitrary” to justify their imposition of a regime which means that Welsh people will not decide how and when Welsh resources are developed? I do not want to replay the battles already fought. However, I am keen to respond to some points that he made during our last discussion on this matter.

First, as he knows well, and as I have already made clear, the Silk commission serves as no cover to justify the failure to enhance the Bill, since the Government have blatantly ignored unanimous Silk recommendations on other matters. The Minister cannot have it both ways. Although I accept that the 350 megawatt limit was agreed in the cross-party commission, that was in the context of an understanding that other parties would support the devolution of a range of policies in other areas and part of a carefully constructed compromise, as he will well recall, several aspects of which are now being sidelined. The Government have ignored the recommendations of the commission on policing, youth justice and rail infrastructure, among other areas. Just to cherry pick from the commission’s recommendations makes a mockery of the process.

Secondly, I am pleased that the Minister has agreed that I was right to highlight the absurd situation of the tidal lagoons, which means that the already approved 320 megawatt Swansea Bay lagoon would be within the threshold, while almost all the other proposed lagoons would not be within the competence of the Assembly. That makes it impossible for the Assembly to develop a coherent expertise, recognised by all people in such matters. Since we already have projects on the stocks in this area and close to each other in size, it really begs the question: seeing that it is arbitrary, why should it not be so at a slightly higher level?

I do not agree with the Minister that the 350 megawatt limit is the only way to do things, as he said, even when it comes to tidal lagoons. He justified the arbitrary 350 megawatt limit by intimating that some strategically important energy projects were not safe in the hands of Wales—at least, that was the implication. Of course, it is the policy of my party that the people of Wales should decide on how all its resources are utilised, regardless of technology or size. However, I emphasise that the Minister need not be concerned about strategically important energy projects being scuppered by Wales. Nuclear energy is already listed in the reservations. A limit well in excess of 2,000 megawatts would still fail to capture much of what is considered as strategically significant by way of energy generation. Fundamentally, a more sensible and pragmatic approach to these energy limits would create a clear, lasting devolution settlement. Even more importantly, in practical and pragmatic terms it would be easier for the developers and for the expertise within the Assembly.

The amendments in my name, unlike the previous ones tabled by Plaid Cymru MPs, recommend a 2,000 megawatt cut-off offer. This would still not encapsulate many of the projects which I had hoped the Government would recognise should be decided on by the Welsh people. But I hope that it offers a more amenable arbitrary limit—yes, arbitrary, as the Minister put it—which would increase Welsh people’s ability to decide how Welsh resources are utilised and give the Assembly a coherent role. The 2,000 megawatt figure, although undoubtedly arbitrary, has been inspired by the Labour amendment in Committee; I readily acknowledge that it proposed the same figure. I therefore hope that I can count on their support for this amendment. Can the Minister outline how any arbitrary limit, be it 350 megawatts or 2,000, can be increased without the need for primary legislation in a pragmatic and sensible fashion, or adjusted in any way that circumstances require, to ensure that we get to a point where Wales’s natural resources are decided on by Welsh people to the maximum possible extent?

Amendment 60, which stands in this group, is on a totally different matter but that is how the group has been put together so I will speak to it now. It deals with the devolution of the Crown Estate to Wales, as is the case in the Scotland Act 2016. The Crown Estate is not currently accountable to the people of Wales. All profits from its holdings are passed to the UK Government. These profits are likely to grow substantially, mainly on account of the demand for renewable energy, and Plaid Cymru firmly believes that the ownership of and control over the Crown Estate in Wales should be transferred to the Welsh Government, as indeed is the case with those in Scotland and the Scottish Government.

I have tabled this amendment in the wake of the recent announcement about spending £369 million on refurbishing Buckingham Palace, funded by an increase in the sovereign grant. Profits from the independent property business of the Crown Estate go to the Treasury, which in turn gives 15% of the sum to the monarch in the form of a sovereign grant for official duties, which this year will total £43 million. The trustees say that the grant should be raised to 25% of these profits to pay for the repairs. I cannot see on what basis of logic or equity we in Wales should forgo the energy revenue potential to pay for such expensive projects, but be that as it may. At present, the Crown Estate receives the financial rights of the Crown in Wales from fishing, mining, oil and gas exploration, tidal and wave power, wind farms and gold and silver, as well as all energy and resources within the territorial waters and borders designated to Wales. It is as if we still live in an imperial time, with an imposition on our natural resources to subsidise in some way the monarchy.

It is true that the devolution of the Crown Estate to Scotland was recommended by cross-party consensus in the Smith agreement, whereas the St David’s Day process found no similar consensus in respect of Wales. I question the Government’s logic, however, when they use omissions in the Silk commission to justify not devolving a policy area and then ignore recommendations to devolve policy areas at their own discretion.

During the year ended March 2016, the Crown Estate in Wales generated £10.5 million in revenue and its capital value is almost £100 million. In Wales, this includes: the Gwynt y Môr offshore wind farm; the marina in Deganwy and Conwy; the Morfa developments in Swansea; 3,238 acres of farmland; 66,470 acres of common land; and 245,000 acres with amenity rights, and much more. It is high time that the power over Welsh land and coast rested in Welsh hands in our National Assembly, with the income used for the benefit of the people of Wales.

Wales was once the leader in carbon-based energy and it is clear that we have the potential to be world leaders again in renewables. Wales is well placed to thrive from the increasing global demand for renewable energy. A recent report by RenewableUK Cymru estimates that the current pipeline of onshore wind projects will generate £2.3 billion of GVA and more than 2,000 full- time equivalent jobs per year. Our 1,200 kilometres of coastline, our deep sea ports and our university expertise in both north and south make Welsh waters particularly valuable to the marine energy industry, which is estimated to be worth up to £3.7 billion to the UK economy by 2020. At the moment, Wales is unable to profit from this huge potential. The country’s ability to do so is constrained by the rules set here at Westminster. Increasing the arbitrary limit on the Welsh Government’s energy competence, which I discussed in my earlier amendment, is one key to the people of Wales seeing greater benefit from this potential. Devolving the Crown Estate is another way of freeing some of those constraints.

In his evidence to the Silk commission, Dr Richard Cowell of Cardiff University suggested that,

“bringing ownership of the Crown Estate in Wales to the Welsh Government might enable a better quality of debate about the kind of off-shore renewable energy development pathway that is appropriate for Wales, and open up discussion on how the royalties from resource exploitation should be best invested”.

I hope the House will agree that devolving the Crown Estate would be a step towards fully harnessing the potential offered by Wales’s natural resources, and will offer a gateway to a prosperous renewables-focused future, encouraging us to do more to help ourselves by utilising our own resources for the benefit of our people. I beg to move.